Financing ITS and the Transport Infrastructure: Policy for Mobility

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Financing ITS and the Transport
InfrastructurePolicy for Mobility

• 15th World Congress on ITS
• November 2008, New York City

Steve Heminger Executive Director Metropolitan
Transportation Commission San Francisco Bay Area
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(No Transcript)
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Statutory Mandate

• Study current condition and future needs of
  surface transportation system
• Evaluate short-tem sources for Highway Trust Fund
  revenues and long-term alternatives to replace or
  supplement fuel tax
• Frame policy and funding recommendations for 15-,
  30-, and 50-year time horizons
• Report to Congress by January 1,2008

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Rebuilding America
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Minnesota I-35 W
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Texas 1-20 West of Pecos
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Louisiana Hurricane Katrina U.S. 90 Ocean Springs
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2005 Report Card for Americas Infrastructure
Sources American Society of Civil Engineers, 2005
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Freight
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China was 33 of US imports in 2000 and will be
50 by 2010
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Dramatic Increase in U.S. Maritime Trade
Volume of trade 2004 and 2020
Source U.S. DOT
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More trade means more domesticfreight movements
U.S. domestic freight tonnage growth forecast,
2000-2020
U.S. domestic freight tonnage forecasts by mode,
2000-2020
(tons in millions)
2020
2000
21,682
17,296
13,772
10,700
2,891
1,470
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2,009
1,054
9
62
44
39
181
57
change 2000-2020
Source U.S. DOT
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Freight Tons, Value, and Ton-Miles, 2002
Trucking dominates domestic freight movement
rail is critical to the movement of bulky,
lower-value commodities and for heavy shipments
moving long distances
80
Truck
74
Rail
67
70
Water
Air
60
Pipeline
Multiple Modes
Other/Unknown Modes
50
40
40
Percent
40
30
20
16
13
9
10
7
6
6
4
3
3
3
2
1
2
lt1
1
lt1
0
0
Tons
Value
Ton-Miles
Source Bureau of Transportation Statistics and
U.S. Census Bureau, 2002 Economic Census,
Transportation, 2002 Commodity Flow Survey,
Table 1b.
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Rail Network Today
Todays rail network has been rationalized and
downsized to a core network that is descended
directly from the 19th Century design
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Metro Mobility
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In Congestion for At Least 40 Hours Annually
Source Texas Transportation Institute
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Metro Areas Greater Than 1 Million
Source U.S. Census
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Metros Capture Huge Market Share
Sources U.S. Census, Texas Transportation
Institute, U.S. Conference of Mayors, EPA
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U.S. Population Change, 2000 2050
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Source U.S. Census
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Safety
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U.S. and G.B. Traffic Fatalities Per 100 Million
VMT
Source Leonard Evans, Traffic Safety, 2004
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U.S. Traffic Deaths Far Exceed Casualties of War
Source Leonard Evans, Traffic Safety, 2004
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Whats Broken?
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Environmental Impact Statement

• Processing Time (FY 19982006)

Source FHWA
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Length of Time to Complete the New Starts Process
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Source Holland Knight
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Street and Highway Construction Costs Have
Increased Dramatically Over the Past Few Years
Highway and street construction costs, 1997-2007
Source Bureau of Labor Statistics
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Finance
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Projected Highway and Transit Account Balances
Through 2012
Source U.S. Department of the Treasury
projections
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Annual National Funding Gap
Cost to Maintain(2055)
Cost to Improvewith Pricing(2055)
Cost to Improvewithout Pricing(2055)
Current Spending(2006)
Source Section 1909 Commission
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Cost to Improve by Category
Source Section 1909 Commission
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Major Finance Recommendations

• The federal surface transportation program should
  not be reauthorized in its current form.
• A new beginning
• performance-driven
• outcome-based
• generally mode-neutral
• refocused on genuine national interest

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Major Finance Recommendations

• The annual investment shortfall to improve the
  condition and performance of all modes of surface
  transportation highway, bridge, public transit,
  freight rail, and intercity passenger rail
  ranges between 140250 billion.

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Major Finance Recommendations

• To address this investment shortfall by providing
  the traditional federal share of 40 of total
  transportation capital funding, the federal fuel
  tax needs to be raised by 25-40 cents per gallon.
  
• This rate increase should be indexed to the
  construction cost index and phased in over a
  period of years.

Fuel Tax vs. Fuel Price
Source AAA
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Major Finance Recommendations

• Fuel tax remains viable revenue at least through
  2025. Thereafter, the most promising alternative
  revenue measure appears to be a vehicle miles
  traveled (VMT) fee, provided that substantial
  privacy and collection cost issues can be
  addressed.
• The deployment of peak-hour congestion pricing
  on Interstate highways in major metropolitan
  areas should be permitted, with revenues
  restricted to transportation purposes in the
  travel corridors where the fees are imposed.

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Major Finance Recommendations

• Public-Private Partnerships should be encouraged
  as a means of attracting additional private
  investment to the surface transportation system,
  provided that conditions are included to protect
  the public interest and the movement of
  interstate commerce.

States with PPP Authority
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Public-Private Partnerships

• Not simply about supplying revenues can also
• Prioritize projects that generate highest returns
• Improve life cycle investing
• Provide incentives for more efficient
  operations/maintenance
• Widely used in Europe, South America, Australia
• Increasing interest by some States
• Construction of new highways or additional
  capacity to existing highways
• Long term leasing of existing toll facilities
• Potential applications for goods movement

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Public-Private Partnerships under Certain
Conditions

• Transparency in negotiation, adequate public
  input, no conflicts of interest
• Meet all applicable planning and environmental
  requirements
• Agreement should require
• Maintenance of facility condition and performance
• Facility returned to the State in good condition
• No non-compete clauses affecting adjacent
  facilities
• Facility returned to the State if private partner
  enters bankruptcy
• Customers interests protected
• Revenue-sharing provisions
• Reasonable term
• Payments used to improve/expand toll facilities
  and capacity on transportation alternatives
  within the same corridor
• Private sector financing provides better value
  than public financing

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Our unity as a nation is sustained by free
communication of thought and by easy
transportation of people and goods... Together
the unifying forces of our communication and
transportation systems are dynamic elements in
the very name we bear United States. Without
them, we would be a mere alliance of many
separate parts.

• Dwight D. Eisenhower, 1955

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For More Informationwww.transportationfortomorr
ow.org
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