Cascadia Prospectus

As we enter the new year--and celebrate the 21st year of publication of our newsletter--one thing is certain: the federal surface transportation program, as indeed the nation's transportation future, remains in a state of flux.

What follows is a brief analysis that has led us to this conclusion. Shortly before the scheduled December 18 expiration of the third temporary extension of the federal surface transportation program, the House and the Senate passed yet another short-term extension, this time through the end of February 2010. Their action underscored once again the continued inability of the Congress to address the long-term transportation needs of the nation. Before adjourning for the holidays, the House also passed by a vote of 217 to 212 a second job stimulus bill (H.R. 2847). The $154 billion measure, endorsed by Rep. James Oberstar (D-MN) chairman of the House Transportation and Infrastructure (T&I) Committee, allocates $36.7 billion in additional funds for highways, transit and Amtrak, extends the surface transportation authorization through Sept. 30, 2010, credits the Highway Trust Fund with $19.5 billion in foregone interest payments and allows the HTF to accrue interest in the future. But because the new stimulus program and its infrastructure component are to be funded with dollars from the Troubled Assets Relief Program (TARP), the bill will face an uncertain future when it reaches the Senate early this year. Opponents may be expected to argue that the law establishing TARP requires unspent and repaid funds to be used to pay down the soaring national debt. The prospect of an impending vote to raise the debt ceiling might further discourage the Senate from redirecting the TARP money. The measure also faces possible White House opposition, given President Obama's strong desire to limit further deficit spending and embark on a more sustainable fiscal policy.

Environmental advocacy groups, while supportive of the House measure, expressed disappointment that it failed to focus on long-term transportation reform or include a National Infrastructure Bank. Even Rep. John Mica (R-FL), ranking member of the House T&I Committee, who generally supports Chairman Oberstar, was moved to criticize the House bill. The "Son of Stimulus," Mica wrote in Roll Call, will be no more successful in creating permanent new jobs in the transportation sector than was the first stimulus bill, since the dollars are being spent on short-term transportation enhancement and road repaving projects that provide jobs only for a few weeks or months. Our own impression, based on local evidence, tends to confirm Rep. Mica's conclusions: the stimulus money has merely allowed local and state highway agencies and their contractors to avoid layoffs and enabled them to keep existing road crews working at full strength. This would be the likely effect of the second stimulus as well. Its effect on job creation (as opposed to job preservation) would be negligible according to many observers. In short, the latest House action is seen by the transportation community as another example of Congressional equivocation, extemporization and inability to come to grips with the nation's long-range transportation needs in a fundamental way.

Policy shifts are often so nuanced and subtle that they're almost not recognizable. Sometimes, however, as with U.S. Secretary of Transportation Ray LaHood's announcement about new funding guidelines for transit projects, they are stark enough to warrant the laudatory adjectives found in the press releases describing the policy change. The latter is true for the announcement that the U.S. transportation chief made at yesterday's Transportation Research Board's annual meeting.

"Our new policy for selecting major transit projects will work to promote livability rather than hinder it," said Secretary LaHood. "We want to base our decisions on how much transit helps the environment, how much it improves development opportunities and how it makes our communities better places to live."

The Obama administration is indeed proposing a "dramatic change" that adds two more criteria for major transit projects to receive funding: economic development and benefits to the environment. The current policy only focused, according to the U.S. Department of Transportation, "primarily on how much a project shortened commute times in comparison to its cost."

Among the type of projects that might benefit from the change in policy would be projects such as streetcars--ones that The New York Times reported Secretary LaHood as saying would make it possible to "...make the case for investing in popular streetcar projects and other transit systems that people want..."

The annual meetings of the Transportation Research Board (TRB) have always been a reliable barometer of the key transportation issues of the day as seen by the transportation community. This year's meeting--which attracted 10,100 participants and featured over 500 technical sessions and workshops--was no exception. What follows are some impressions from the conference, after listening to some 60 presentations and holding informal conversations with a number of conference speakers and other participants during the 4-day meeting, January 10-13.

The overall impression was one of a pervasive climate of uncertainty about the future. Conference sessions and informal conversations were full of speculations concerning the status of the surface transportation reauthorization, the potential solutions to the funding dilemma, the fate of the climate change legislation, the future direction of the federal high-speed rail program and the impact of the upcoming midterm elections on pending legislation, notably the surface transportation reauthorization and the climate change bill. The outcome of the second job stimulus bill was also a subject of much speculation. The bill, which already has been approved by the House and now awaits action in the Senate, would inject substantial interim funds into the surface transportation program and extend the surface transportation authorization through Sept. 30, 2010. The $154 billion measure would allocate $36.7 billion for highways, transit and Amtrak, credit the Highway Trust Fund (HTF) with $19.5 billion in foregone interest payments and allow the Trust Fund to accrue interest in the future. But, as one congressional source attending the TRB Conference told us, the Senate prospects for the deficit-funded jobs bill appear uncertain.

Senate opponents claim there is plenty of stimulus money still in the pipeline and the bill's requirement to spend the money within 90 days imposes an unrealistic deadline given the lengthy contracting process involved in infrastructure procurement. Additionally, Senate opponents may be expected to argue that the law establishing TARP requires unspent and repaid funds to be used to pay down the soaring national debt. The prospect of another vote to raise the debt ceiling might further discourage the Senate from redirecting the TARP money.

Secretary LaHood's address at the TRB Annual Luncheon, announcing revised criteria for New Starts funding, received a generally positive reception from the TRB audience. Under the new policy, proposals for new rail transit projects will be judged by a broader range of factors than in the past. In addition to cost-effectiveness, the criteria will include economic and environmental benefits, land use impact and "livability." One beneficial effect of the revamped policy should be a wider consideration of streetcars. This was first made possible several years ago when the Bush Administration made streetcars eligible for federal funding under its "Very Small Starts" category (Interim Guidance on Small Starts, July 26, 2006.) As many as 40 U.S. cities are in various stages of considering or planning streetcar projects according to a survey conducted by the Community Streetcar Coalition. As we observed in an earlier NewsBrief, "just as 30 years ago a less costly light rail transit LRT technology began to replace expensive heavy rail systems, so today, streetcars are offering to medium-size cities a more affordable fixed-guideway alternative to light rail systems." (The Streetcar Makes a Comeback, Innovation NewsBriefs, September 2006.)

The idea of better high-speed rail in the Northwest's Cascadia Corridor came out of the ether and into the realm of reality last night in the nation's capital and today in Florida with President Obama's announcement of $590 million for the region's high-speed rail development. Amidst the applause and subtle guffaws so typical at all State of the Union addresses, Washingtonians -- especially those who have so long worked on the issue in this part of the U.S. -- cheered.

As the Seattle Times' reported this morning, "The money represents the Northwest's piece of an $8 billion stimulus package for high-speed rail, to be announced Thursday in Florida by President Obama."

Washington's Governor Christine Gregoire, in a press release said:

"These funds will offer great returns: We will put people to work and improve a transit service on which more and more Washingtonians rely," Gregoire said. "Thanks to these investments, we will move more people, move them more efficiently and move them more reliably."

The funding will be used for everything from upgrading tracks to increasing the frequency and speed of service along the Cascadia Corridor.