The home state of CSG’s National Headquarters has been in the national transportation policy spotlight a fair amount in recent weeks. First, President Obama chose to highlight the need to repair the Brent Spence Bridge, which carries Interstates 71 and 75 over the Ohio River between Covington, Kentucky and Cincinnati, Ohio, during his September 8 speech to Congress unveiling his jobs plan and its proposed infrastructure investments. Just a day later, Indiana officials ordered closed another Ohio River span, the Sherman Minton Bridge between Louisville and Southern Indiana, after cracks were discovered in its steel beams. It was a 2010 Kentucky truck crash that prompted the National Transportation Safety Board last week to recommend a ban on cell phone use by commercial drivers. And this week, the President used the Brent Spence Bridge as a backdrop to again tout his jobs plan in the backyards of both Senate Minority Leader Mitch McConnell (R-KY) and House Speaker John Boehner (R-OH). Kentucky is also the focus of an article I have out this week in the state business magazine The Lane Report. It examines why most highway projects take so long to complete.

Congress this week beat a couple of looming deadlines and voted to extend authority for the Federal Aviation Administration and the nation’s surface transportation programs. Meanwhile, some are resisting President Obama’s call for the creation of a National Infrastructure Bank as part of his American Jobs Act.

This week, President Obama banks again on infrastructure investment to stimulate the nation’s economy. Also, a key Senate committee approves a four-month extension of surface transportation programs as a House Appropriations subcommittee passes a 2012 transportation budget that cuts overall spending and Administration-favored programs. There are also items this week on congestion reduction, sprawl and smart growth.

The President fired a shot across the bow of Congress last night with his $450 billion proposal to address the jobs crisis.  In a reprise of the Recovery Act of 2009 (the “stimulus”), the majority of new spending in the proposal would flow through state and local government with over $110 billion devoted to infrastructure and education alone.  However, state budget planners need not revise their mid-year predictions just yet as the bill will face a hurricane-force headwind as soon as it hits the House of Representatives next week. 

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.

To improve state's infrastructure, Nebraska legislators decide to add new revenue source for roads.

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 U.S. Senate Environment and Public Works Committee released a three-page outline of a bipartisan bill to authorize federal transportation programs Tuesday and held the first hearing on the plan Thursday. There is also news this week about state efforts to find new sources of revenue to fund transportation, including public-private partnerships.

Although traditional revenue sources for transportation such as gas taxes are in decline, little was done to shore them up in 2011 legislative sessions. While a handful of states enacted major transportation finance legislation, budget cuts and bare-bones plans were more common. Some states are exploring public-private partnerships or alternative finance mechanisms to help meet their infrastructure needs. But a number of states this year created committees to study transportation finance needs and report back on potential solutions at a future date.

More than 30 states and Puerto Rico have created a state infrastructure bank, a type of revolving infrastructure investment fund that can offer loans and credit assistance to public and private sponsors of certain highway construction, transit or rail projects. Five states--Florida, Georgia, Kansas, Ohio and Virginia--have established banks or accounts within their banks that are capitalized solely with state funds. These banks were designed with the unique needs of each state in mind and their experiences have varied. The future of state infrastructure banks may depend on the next federal surface transportation authorization and what kinds of federal funding and financing resources may be available to states in the future.

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