Top 5 Issues for 2013: Transportation
CSG's Senior Transportation Analyst Sean Slone outlines the top five issues for 2013, including implementation of the new transportation authorization bill, future transportation financing options, America's infrastructure needs, and preparing for an expanded Panama Canal.
Implementation of MAP-21
MAP-21, the two-year transportation bill approved by Congress in June 2012, included a number of substantial changes that are likely to impact state governments in 2013. States were called on to play a significant role in establishing performance measures to help make progress toward national performance goals. The bill dramatically expanded the Transportation Infrastructure Finance and Innovation Act program, which provides federal credit assistance for transportation projects of national and regional significance. Perhaps most importantly, by funding programs for two years at current levels, the legislation brought with it some degree of certainty for states after enduring multiple short-term extensions of the previous bill.
A Post-MAP-21 Game Plan for Financing Transportation
MAP-21 did not provide a long-term blueprint for the federal transportation program. Increased fuel efficiency, the impact of inflation and other factors have taken their toll on gas tax revenues. Since 2008, Congress has had to transfer $55 billion from the general fund to the Highway Trust Fund, including more than $12.5 billion in MAP-21. A lack of agreement in Washington over long-term financing of the federal program was one reason MAP-21 was so long in the works and relatively short in duration compared to previous authorization bills. State governments in 2013 will want to make sure Congress makes progress toward a successor to MAP-21 that arrives on time in 2014 and with a long-term plan. A perpetual cycle of short-term extensions and general fund transfers could mean long-term transportation planning and transformative projects get neglected in the years ahead.
New State Revenues for Transportation
A substantial number of states appear poised to seek new transportation revenues in 2013. Increasing state gas taxes, indexing them to inflation, increasing license and registration fees, and expanding tolling are all likely to get a look from state legislatures in 2013. While states like Maryland, Massachusetts, Pennsylvania and Virginia will take another whack at the piñata in 2013 after somewhat mixed results in years past, another round of states—including Minnesota, West Virginia and Wisconsin—will seek a way forward in the newly presented recommendations of transportation funding commissions. Oregon and other states continue to research what some believe could be an eventual replacement for the gas tax—mileage fees. Many states also continue to pursue public-private partnerships to finance transportation projects.
Preparedness for the Panama Canal Expansion
A newly widened Panama Canal, expected to open in 2014, will bring larger ships to Atlantic and Gulf coast ports and could dramatically reshape cargo and freight traffic patterns across the country. 2013 will be an important year for ensuring America’s infrastructure is prepared for the shift. The dredging of harbors to allow for the larger ships and the upgrading of coastal and even inland port facilities are just two items on the to-do list.
Convincing a Skeptical Public
The concept of crumbling infrastructure fails to register for many Americans. If their daily commute doesn’t include large potholes and frequent traffic tie-ups, they may fail to see the need for increased investment in infrastructure. It often takes something on the order of a bridge collapse or a Hurricane Sandy-like disaster for infrastructure to even get much attention as an issue. But 2013 will bring plenty of new data on what America’s infrastructure needs are. The American Society of Civil Engineers will issue its latest Report Card for America’s Infrastructure in March. The organization’s last report in 2009 graded America’s infrastructure a D and said the nation currently spends only about half of what is needed to maintain it.