Cost and Financing

With significant growth expected in freight transportation over the next several decades as a result of the expansion of the Panama Canal and other factors, a number of states have begun to adopt policies that seek to take trucks off the road and make the nation's supply chain more multi-modal. By improving infrastructure at seaports, incentivizing shippers, making greater use of inland waterways, creating partnerships to reduce freight rail bottlenecks and developing state and regional freight plans, these states stand to make significant improvements to freight efficiency and safety as well as to the environment. 

State transportation officials this week called on Congress to take action by September 30th to extend the 18.4 cents-per-gallon gas tax that funds federal highway and transit programs and to pass a long-term reauthorization of those programs. I also have items this week on the future of infrastructure finance, tolling, public transit, Smart Growth, a model for regional freight plans, Seattle’s new Big Dig and possible restructuring for the South Carolina Department of Transportation following a recent fiscal crisis.

With Washington still embroiled in the debt ceiling debate and no momentum for a new transportation reauthorization bill, we get a glimpse this week at the potential cost of doing nothing to improve America’s infrastructure. The American Society of Civil Engineers (ASCE) issues a new report today entitled “Failure to Act: The Economic Impact of Current Investment Trends in Surface Transportation Infrastructure.” The report indicates that not only are American households and businesses absorbing enormous costs today as a result of deteriorating infrastructure, over the next 30 years these costs could further reduce America’s productivity and competitiveness in the world, cause millions of Americans to forgo discretionary purchases in order to pay transportation costs that could have been avoided, cause the U.S. to lose out on creating jobs in high paying services and manufacturing industries, produce a significant drain on wages and productivity and result in the United States losing billions of dollars in foreign exports.

The American Recovery and Reinvestment Act of 2009 provided $48 billion to states for transportation infrastructure projects. States achieved significant successes in 2010 in  meeting deadlines associated with the legislation, starting and completing projects on time and under budget, creating jobs and doing it all with little fraud or waste. Still, some questions have been raised about whether the stimulus could have had a greater impact, which types of projects were funded and which states received the most funding. Despite its political unpopularity in 2010, the Recovery Act proved its worth to state transportation officials around the country.

With the holidays fast approaching, I thought it would be a good time to clear out the ol’ CSG Transportation inbox so that we can make a fresh start in the New Year. In doing so, I ran across a number of recent reports and news items that may be of interest and that may provide worthwhile reading should you have any downtime in between football bowl games in the weeks ahead. They address many of the themes we’ve examined here over the last year and look ahead to what might lay in store in 2011 on issues like federal transportation programs, the condition of America's infrastructure, gas taxes, highway finance alternatives, high-speed rail, freight transportation, transportation and the environment and intelligent transportation systems.

The future of transportation was very much on the minds of participants at the annual meeting of the Southern Legislative Conference held earlier this month in Charleston, South Carolina. The role of transportation in economic development, the status of a new federal highway bill, state funding of infrastructure improvements and efforts to prepare southern ports for the expansion of the Panama Canal all received attention from various speakers over the course of the five-day meeting. Here is just some of what I heard on those topics.

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