CSG Transportation Policy Academy Part 11: Portland Metro Councilman Bob Stacey

The final speaker at CSG’s Transportation Policy Academy in Portland, Oregon was someone who knows that city well. Bob Stacey is a member of the Portland Metro Council representing District 6. He previously served as Planning Director for the City of Portland, Senior Policy Advisor to Oregon Gov. Barbara Roberts, Executive Director for Policy and Planning at the Tri-County Metropolitan Transportation District of Oregon (TriMet), Chief of Staff to Congressman Earl Blumenauer (D-OR), and Executive Director of 1000 Friends of Oregon. Stacey spoke about the federal-state-local partnership on transportation, why the partnership isn’t working very well right now and how a metropolitan strategy might help redefine it.

“Back in the ‘90s when my career started focusing on federal transportation issues, the partnership seemed a lot more important,” he recalled. “There was proportionately more money coming from Washington, D.C. to the states—but not necessarily to Oregon. In fact, Oregon’s primary strategy for avoiding donor state status—a state that sends out more than it gets back—was our successful competition for light rail funding grants. Then, as now, transit advocates in Oregon and other parts of the country were deeply grateful for the federal partnership because Oregon’s highway trust fund applies to everything you can do to tax use or operation or ownership of an automobile and it puts all of that money—no exceptions—into a constitutionally dedicated highway trust fund that’s only for roads and bridges.”

Stacey said traditionally federal, state, local and regional governments have shared common interests and objectives.

“What we all want from that partnership has been to build and maintain a transportation system that delivers to our citizens and our communities prosperity, safety, and human and environmental health—sort of the core values of a livable community,” he said. “The core mission for the transportation partnership should be to maintain what we’ve got, improve the safety and efficiency of the existing system, and reverse its adverse health and environmental impacts. And then to carefully and prudently build the system increases, the capacity increases with cost effective investments that improve access and mobility. …"

"But come on, we’re in it for the money. The states want money from Washington. Locals want money from Washington and the states. And the federal government historically was happy to oblige as long as our delegations got their due credit for bringing home the bacon. But in recent years, as you know, the money transfer part of the partnership has gotten a lot harder. Congress is deadlocked between the advocates of public investment to rebuild our economy on one side and deficit and debt hawks on the other who are trying to protect the public purse. It has splintered the once bipartisan interest in sending money home for bridges, roads, and trains. And that split in Congress has been made more deep and difficult because of the decline of Highway Trust Fund revenues as Americans drive fewer miles (and) drive more fuel efficient vehicles. It’s hard to make people happy with less money to go around. And increasing the federal gas tax, as you know, has been a non-starter.”

“I think in many parts of the country you’re seeing a similar problem. Some are being successful (in raising revenues) but there’s a long list of states that are not being successful. State gas taxes are also buying less as driving at least stabilizes and in some places goes down. And some state legislatures are finding the politics of raising resources either politically poisonous or very expensive in terms of what has to be done to make everybody happy.”

For an illustration of how the fractured partnership operates these days, one need look no further than the recent controversy over the Columbia River Crossing bridge megaproject which helped derail a transportation package in Washington state (as described by Washington state Rep. Judy Clibborn at an earlier session of the academy), Stacey said

“I think there’s a lesson in here,” he told attendees. “A lot of us love to build big projects like Portland’s current light rail, which I believe you saw—the Orange Line out to Milwaukie—at $200 million a mile. … The Columbia River Crossing, which would have clocked in at $800 million a mile or thereabouts, or Seattle’s Alaskan Way Viaduct … $1.5 billion a mile. Even if all those megaprojects are good ideas, they can suck up all the political energy and thus all of the money out of addressing our funding needs for the transportation system as a whole instead of, as I think a lot of the allies in the transportation lobby have assumed, that you can build consensus with a wide range of projects. They seem to draw their own particular enemies into a coalition that opposes and so it’s making getting money for everything harder—everything from capital projects to patching potholes—and harder to raise in Salem, Olympia and Washington, D.C.”

As far as what to do in the face of this fractured partnership and how to seek more money for the upkeep and expansion of transportation systems that are needed to support economic development and population growth, Stacey believes the nation must turn to its cities.

“I think we should be looking at where the money that is being made and where it is most needed and that is the large, metro areas of the country. The real driver in the discussion about the future of the federal-state-local partnership should be about the ever growing role of metropolitan economies in the larger state and federal economies they’re nesting in. Bruce Katz of the Brookings Institution points out—every two weeks it seems—that America’s 100 largest metropolitan areas contain two-thirds of the population in 12 percent of the land area and they generate 75 percent of the U.S. gross domestic product. As Katz and others have pointed out, there’s not so much a national economy as there is a network or web of these regional economies and they’re all locked in fierce competition with each other and with their global rivals to draw talent and investment to them. Success or failure of these metropolitan economies are going to determine to a very large extent the fates of our state and national economies as well. To be successful in their global competition, our metropolitan areas will need efficient, highly effective transportation systems to move coal or oil or wheat, as is the case in Oregon, from … the place where resources are developed to the shore or to the centers of industry that need those resources.”

But Stacey believes that likely means the traditional funding roles in the federal-state-local partnership will need to change.

“Even if the political climate were more favorable for regular gas tax increases to raise enough state and federal dollars to fund transportation system improvements needed in our metropolitan areas, at the scale that we’ve been talking about this morning—billions of dollars—there comes a tipping point … where statewide uniform taxation no longer makes sense. You try to fold the cost of big urban projects and transit projects into a statewide gas tax and that raises the rate to where people in rural communities get uncomfortable.”

As an example, Stacey suggested the more sparsely populated Oregon coast.

“For the last 77 years, U.S. Highway 101 has served that whole 360 mile coast as its primary arterial and in many parts of the coast, the only North-South road,” he said. “Since it was completed in 1936, it’s been a two-lane highway for the vast majority of its length. From time to time, (the Oregon Department of Transportation) adds a passing lane or straightens out a curve or maybe widens a shoulder but there’s no stretch of freeway on U.S. 101 in Oregon. There’s no big bypasses going around the towns there. And given the outlook for economic and population growth on the coast, it might be that way for the next 77 years."

"So you could probably persuade a legislator from the Oregon coast or a taxpayer that the highway user tax system needs to be high enough to raise money to maintain 101, to repair it after a landslide or a major winter storm or to fund safety improvements as the resources become available. But why should the cost of a gallon of gas—the tax on that gas or the charge per mile if we go to the (vehicle miles traveled) charge that Jim Whitty talked about—why should that charge in Port Orford on the south coast be high enough to cover the massive cost of freeway interchanges, light rail and other projects needed to accommodate another million people in the metropolitan area of Portland? I believe that dichotomy explains part of what we’re seeing in the failure of Washington’s transportation funding package this session just ended and the 2009 Oregon gas tax increase which succeeded but at the cost of $900 million in earmarks out of a package that wasn’t that big.”

Stacey said the money to meet the transportation needs of the nation’s metropolitan regions might be raised in a number of ways.

“In some parts of the country, depending on local and political taxation cultures, it may make sense to raise that money through whatever the flavor is. It’s not sales taxes here but property taxes or income taxes.”

But Stacey would rather see the user pays concept behind the gas tax maintained.

“Transportation is like a utility and those of us who use more of it probably should pay more and most passenger miles in fact occur in metropolitan areas,” he noted. “The problem with using the gas tax to capture all that use as you’ve heard from Jim Whitty and others is simply that people are buying less gas, therefore revenues are rising too slowly or actually falling. We can remedy that through the per mile charge that Jim Whitty of ODOT has described to you—and has repeatedly and tirelessly described to other Oregonians. It can be set at a rate to cover the cost of system maintenance and modernization based on the amount of use a vehicle makes of the system.”

“But in urban areas that’s probably not the most efficient way to also cover the cost of increased transportation capacity—big freeway interchanges, light rail, major new bus expansion. During peak periods far more cars are trying to use the urban network that can fit in the network that any metropolitan area has yet to be able to devise. A lot of us have come to accept the premise that you can’t build your way out of congestion, that the consequence of widening a road in a major urban area is that more people will be attracted to the marginally higher speeds and convenience that are now available on that roadway until it’s once again congested. So the economists and transportation theorists have long told us that congestion pricing or tolling is an effective market tool to nudge urban transportation users into making cost effective decisions. Carpooling for example would allow the driver and passengers to reduce the impact of the toll on that trip by a half or more. Shifting the time a trip is taken can avoid a peak hour congestion price. Shifting to another mode can also avoid the toll. And experience in places that have used peak congestion pricing on facilities or urban cores shows that enough people change their behavior in order to maintain a relatively free-flowing, relatively speedy traffic throughout. Which means freight can get through from the hinterlands to the docks. Which means that people are timing their trips for when they need them and they’re reducing the cost effectively. And it takes 20 or 25 percent reduction in trips at peak to make those kinds of changes effective. A congestion pricing strategy however makes no sense as part of a statewide highway funding program. The residents of Port Orford are going to gain nothing from having a toll placed on 101 through their small town. But in a place like Seattle or Portland it can both raise urgently needed revenue and avoid the need to waste money by building facilities larger if that really won’t solve the problem.”

Stacey sees new opportunities and new roles under a revised federal-state-local partnership that emphasizes a metropolitan strategy.

“States can authorize urban cities and counties or regional transportation authorities such as transit districts to enact transportation taxes or charges,” he said. “States can remove barriers and impediments to adopting those taxes such as the requirements prevalent in Oregon that you have a vote of the (people) before you can levy such a tax. Now that’ll be controversial and it should be and we ought to have an argument about it. But the economic case for making it easier to raise resources to make these metropolitan systems work, should be clear as well. If our states’ metropolitan economies don’t prosper, our state economies are toast. Efficient urban transportation systems are critical to economic success. We may need to give some of the job of taxing metropolitan areas for transportation to the legislators of the entire state, many of whom will not have to answer directly to the voters who will pay those taxes. … The federal government can play a role in this metropolitan strategy as well. Both state and federal laws that direct or limit how transportation funding is spent … I think are based on old political paradigms and they’re specific to particular parts of the country. Federal and state legislators should start reducing legal barriers to making the most effective and efficient use of the transportation dollars that are raised around the metropolitan areas. … I think each metropolitan area should be allowed a great deal of flexibility—more than federal and state laws do today—to design their own transportation path to livability and prosperity. Transportation systems can be a major part of a region’s comparative advantage in the global competition designing regional transportation networks to enhance the business and economic climate as well as the quality of life that’s so important to attracting talented workers will be critical to economic competitiveness. Portland or Phoenix or Atlanta are probably not going to have the same mix of transportation investments in their portfolios as they try to hone their relative competitive edge in the world marketplace. That should be okay. After all, this is America. We believe in competition. Urban regions will live from or suffer from the consequences of their choices and to the swift will go the race. Fundamentally the states and the federal government should enable and facilitate the generation of transportation revenues in metropolitan areas, require the metropolitan areas and local governments to agree on a strategy for economic success with those transportation investments and then—as some of the others have said this morning—get out of the way and let metro areas compete.”                     

Additional Resources

Metro Council District 6 News   

Bruce Katz, The Brookings Institution

Further Reading

"The Limits of Metropolitan Planning Organizations," The Atlantic Cities, April 30, 2012