Transportation Policy Academy Pt. 2: ASCE’s Brian Pallasch

In October 2011, CSG hosted an invitation-only Transportation Policy Academy in Washington, D.C. for a group of 11 state legislators from around the country, many of whom serve in leadership positions on transportation-focused committees in their states. In addition to providing an opportunity for these state leaders to meet with their members of Congress about the future of transportation policy, CSG also invited a group of policy experts, public officials, advocates and observers to speak to the group about the policy landscape, what may lie ahead for states in transportation and what some states are doing in the absence of federal action. In the interest of sharing their insights and expertise with a broader CSG audience, this series of blog posts will feature extended excerpts from their remarks on a wide variety of transportation policy issues. Brian Pallasch is the Managing Director for Government Relations and Infrastructure Initiatives at the American Society of Civil Engineers (ASCE), Washington, DC. In his remarks to policy academy participants, Pallasch spoke about the ASCE’s latest report card and a 2011 report on the cost of failing to do nothing to improve America’s infrastructure.

Since joining the ASCE staff in 1999, Pallasch has been responsible for managing the government relations department including federal and state legislative affairs, regulatory affairs, grassroots, and policy development.  Since 2008, Pallasch has been responsible for managing ASCE’s strategic initiatives regarding infrastructure including development of the Report Card for America’s Infrastructure.

Here are some excerpts from his remarks:

ASCE’s History of Assessing Infrastructure

Pallasch: “ASCE for a number of years has been devoting a good deal of time and effort and resources to trying to explain to people what the problems are with our nation’s infrastructure. We felt about 12-13 years ago that there wasn’t a good understanding that we have not been investing properly in our nation’s infrastructure…”

 “In 1998, ASCE took a look at the nation’s infrastructure at the 10 year mark after [a 1988 report issued by the Reagan-era National Council for Public Works Improvement] to find out had there really been any substantive changes in our nation’s infrastructure and we found that in fact, there really hadn’t been. And subsequently we’ve done reports about every four years since then. Our last report which we now call “The Report Card for America’s Infrastructure” was released in 2009.”

[Editor’s Note: The 1988 report, the ASCE’s latest report card and the previous ones can all be read here].

America’s Infrastructure Not Improving

Pallasch: “I’d like to say the news has gotten better or the information’s getting better and we’re doing a better job, but we’re not. Our infrastructure from a grading standpoint—and we use the simple grading system that is used in schools—(receives a grade) of D… That is not an improvement over the previous four years. From 2005 to 2009, we did not see any significant improvement. And what we did see is that the estimated investment needs have gone up significantly…”

The Cost to Improve

Pallasch: “The estimated investment need over five years is $2.2 trillion. That’s a big number, that’s a lot of money… A good chunk of that money is already being spent. So to say that we need to go find $2.2 trillion is not a fair and correct statement. But that’s the amount that we feel should be invested. That’s to get our nation’s infrastructure to a grade of about a B…”

“It was estimated that $1 trillion would be spent over the five year period from federal, state, local and private sources. So an additional $1 trillion was needed.”

Bridges Get a Grade of C

Pallasch: “Twenty-six percent of our bridges in the nation are structurally deficient or functionally obsolete. We have a little bit less concern about the functionally obsolete bridges. The best example I have of a functionally obsolete bridge that will always remain functionally obsolete is the Brooklyn Bridge. We’re not going to go back and change the lane widths on that or change the egress and access to that bridge. But structurally deficient bridges do cause us a great deal of concern and those are the types of things that need to be fixed. However, we’ve been doing a better than average job, believe it or not, on fixing the nation’s bridges. The federal government spends about $10.5 billion on the bridge program every year. We need to be spending more. Our estimate is that we should be spending about $17 billion at the federal level. But still… we’re taking bad bridges off the list, if you will. We’ll never get them all off the list because it’s impossible to make that work that way because there will always be bridges getting older. There is a higher percentage of these deficient bridges in urban areas, which is not a big shock, and it’s really for two reasons: number one, the urban areas are growing… and number two, they have the most vehicle traffic and as a result they’re going to age faster in some instances.”

[Editor’s note: A recent Transportation for America report ranks deficient bridges by metro area. It can be read here.]

Cost of Failing to Act

Pallasch: “We did an economic study—which is a new thing for ASCE—to look at what happens if we don’t invest any more money in our nation’s infrastructure. What will happen to our economy by the year 2020 or 2040?... Failing to invest in our roads and bridges will actually have a dramatic effect on the nation’s economy. There’s actually a strong link between the nation’s infrastructure and our economic competitiveness… What we were able to do… is figure out what the nexus is between those two and really what the cost is of not investing in our nation’s infrastructure.”

“Unless we start investing some more money, our nation is going to face some additional job losses as a result of not having a good transportation infrastructure. The citizens will have falling wages and there will actually be a drag on the nation’s businesses and… our economy will be stuck in the slow lane … Deficient infrastructure actually cost American households and businesses last year about $130 billion, which is more than we’re spending on the nation’s surface transportation infrastructure. By 2020, deficient infrastructure is going to cost an added $430 billion to the nation’s transportation costs. So the cost of moving goods around this country by truck, by rail is going to be $430 billion. We also found that by 2020 exports are going to be $28 billion lower. So our ability to get the goods that we’re manufacturing out of this country is going to go down or our trade deficit will grow or we’ll simply not be exporting as many goods. Over that time by 2020, 870,000 jobs will be lost … Those are high-skilled jobs …”

“Actually in a few areas there (would be) job growth. In some of the transportation services, there is job growth. What’s included in transportation services are people who fix your cars and so more potholes means more jobs for them. While those are good jobs, those are not high-skilled and high-paying jobs, per se. And in fact, we found that household income will fall about $7,000 by 2020. Our GDP will take a hit of almost $1 trillion.”

“We do think that with the proper level of investment and with some increased investment, what you end up getting is you protect jobs. We feel that by 2020, you’ll protect about 1.1 million jobs. We’ll actually save two billion hours of wasted travel time in this country. That’s not only for you and I who get stuck commuting to and from our jobs. In addition, you’ll save families about $1,060 dollars a year…”

[Editor’s note: The ASCE’s report on the cost of failing to invest in transportation can be read here].

Future of Transportation Funding

Pallasch: “We are struggling mightily not only at ASCE but also in the work that we’ve done with the (U.S. Chamber of Commerce) and (the American Association of State Highway and Transportation Officials) and other groups on the question of how do we overcome the public outcry over this concept of higher taxes and fees. There were a number of studies done this year. The Rockefeller Foundation did a very interesting poll after the President’s State of the Union Address where somewhere in the neighborhood of 70 to 75 percent of the people in this poll said “we need to fix our infrastructure…” They gave them a list of (questions) on how to pay for it and none of them were acceptable. You can’t toll, you can’t raise the gas tax. They like public-private partnerships although I think people don’t understand that somewhere at the end of the public-private partnership, which may be a great thing, there is a fee to somebody because the private entity does need to make money.”

“Financing … cannot replace actual funding for our infrastructure. Financing is great. There are lots of tools out there and we think all those tools should be used appropriately. But those financing tools do not replace actual funding.”

[Editor's Note: Pallasch also spoke at CSG's National Conference in Bellevue, Washington on October 22, 2011. You can find an outline of his remarks here.]