USDOT Under Secretary Polly Trottenberg Visits the Rudin Center


by Nolan Levenson, photos by Marilyn Lopez

Polly Trottenberg, Under Secretary of the US Department of Transportation, visited with the NYU Rudin Center and Wagner students, faculty, transportation professionals, and representatives of the media last week to discuss timely issues in federal transportation policy. Her talk focused on financing transportation, the successes of the TIGER grant program, and the increasing role of technology and data in government.

She also addressed how the Sequester will impact USDOT. Since the Federal Aviation Administration (FAA) composes about 75% of the USDOT’s budget, they will bear the burden of the spending cuts. Airports with less traffic may lose their funding. There will also likely be impacts to the Federal Transit Administration’s (FTA) budget, but about half of USDOT will be unaffected.

Ms. Trottenberg also highlighted the increasing difficulty of financing transportation as the gas tax no longer covers the nation’s transportation infrastructure needs. She pointed to tools such as gas sales taxes and Vehicles Miles Traveled (VMT) taxes, and emphasized tolling of highways as a potential significant revenue source. She acknowledged that while federal transportation law prevents the tolling of existing road capacity, state law and legislators have also failed to initiate policies that would change this limitation, which creates a political block on a potential new revenue source for transportation. In general, she said, she believes that state transportation policy must be pushed in a more progressive direction.

Many in the room were happy to hear Ms. Trottenberg’s support for more open data and advanced technology use at the federal government. She said that USDOT should tap into the resources of the private sector to better understand and analyze transportation issues throughout the country. She pointed to a moment when her staff was on the phone with Google employees in Stuttgart, Germany, when the USDOT staff asked about the reliability of real-time traffic data. After a pause of a few seconds, the Google employees responded, “well it’s not like it’s more than 60 seconds off,” a response met with laughter by USDOT staff considering that to be, of course, extremely reliable. The story was also received with laughter during our discussion, and the audience appreciated the example for government’s need to tap into existing technological resources.

Toll Debate Heats Up in the West

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Each day, nearly 24,000 vehicles race through a 30 mile stretch of Interstate-15 that pierces the northwestern corner Arizona. This segment of the highway – known as the “Arizona Strip” – looks much like the rest of I-15 as it traverses through the Mojave Desert, serving as a vital freight link between Southern California and points West. Many drivers don’t even know they have entered Arizona.

One-fourth of traffic on the Arizona Strip is freight trucks. Photo courtesy of Gannett.

 

But the state ignited a firestorm of controversy when it submitted a proposal to the U.S. Department of Transportation last week to begin tolling that 30-mile segment for everyone but Arizona residents.

In documents submitted to the federal government’s tolling and pricing office, the Arizona Department of Transportation (ADOT) states that it is seeking to participate in the Interstate Reconstruction and Rehabilitation Pilot Program. That program, authorized in 1998, allows up to three segments of the Interstate Highway System to be tolled by states to finance roadway improvements or expansion. Two other states have been granted permission to toll Interstate highways: Interstate 70 in Missouri and Interstate 95 in Virginia.

Detail of Arizona's proposed project area. Courtesy of ADOT.

ADOT contends that a new toll would raise up to $393 million over a 30 year period to fund vital roadway improvements, including bridge superstructure improvement, pavement rehabilitation, and safety enhancements. In its application, ADOT admits that tolling existing interstate capacity is “not popular,” but that a new source of revenue is necessary to carry out necessary improvements and tolling is the “most equitable method of accomplishing it on this very unique and isolated section of roadway.”

The proposal was immediately criticized by officials in neighboring Utah and Nevada. “If Arizona has been negligent in its maintenance of I-15, it should not try and foist its responsibility onto highway users or neighboring states who already pay into the system with their own tax dollars” Utah Governor Gary R. Herbert said in a prepared statement. The Las Vegas Review-Journal called the plan a “money grab…built on the backs of Nevada and Utah residents and commercial haulers.”

With shrinking revenues and constricted budgets, however, many states do not have other options to finance necessary highway improvements. Several states, most recently Virginia, have pursued public-private partnerships to begin tolling segments of existing state highways or newly constructed Interstate highways.

It’s a trend that shows no sign of slowing.  According to the Federal Highway Administration figures, 32 states have developed a total of 280 toll projects between 1991 and 2009, roughly divided between newly constructed toll highways and toll-backed improvements to existing facilities. Toll roads now account for nearly one-half of newly constructed access-controlled expressways.

As Virginia Governor Bob McDonnell explained after his state received approval to begin tolling a segment of Interstate-95, “limited funds and growing capital and maintenance needs have led to deficient pavement and structures, congestion, higher crash density, and safety concerns. This approval is a major step toward funding critical capacity and infrastructure investment needed in this corridor.”

Future Still Murky for Federal Transportation Bill


 

It’s been more than two years since the last federal transportation bill expired, and the debate in Washington about the size and scope of the next bill continues. Members of both parties have acknowledged the declining state of America’s highways and infrastructure, but appear to be no closer to an agreement about the federal government’s priorities for investing in the country’s crumbling bridges and roads. Last year, the American Society of Civil Engineers (ASCE) gave U.S. roads a dismal “D-” grade in a report that found nearly half of all vehicle miles traveled on urban expressways in 2009 were traveled on deficient pavement. In it’s final report to Congress, the National Surface Transportation Infrastructure Commission found that the U.S. would need to invest nearly $200 billion each year to maintain our road and highway network. Last year, public spending totaled $160 billion.

Various federal commissions have concluded that the U.S. is under-investing in its roads and highways.

 

While there appears to be agreement about the need for repairing roads, the heart of the debate is the amount of money to invest. President Obama has been calling for the greatest amount of funding through his American Jobs Act. The President calls for a $50 billion investment in transportation and infrastructure that includes a new $10 billion national infrastructure bank and about $27 billion for highways and road maintenance. With Congressional Republicans and even a few Democrats balking at the President’s plan, the chances of the American Jobs Act passing Congress in one piece are slim to none. In an effort to get some of the provisions passed into law, Senate Democrats are preparing to break up the bill into smaller parts and vote on them separately, with the first vote in the Senate scheduled for this evening.

President Obama has pushed Congress to pass a jobs bill.

House Transportation and Infrastructure Committee Chairman John Mica (R-FL) has been critical of Obama’s national infrastructure plan and opposes many of the President’s signature projects such as high speed rail. Mica released a broad six-year transportation proposal in July 2011 that cuts federal funding by nearly 20 percent. The House proposal would eliminate or consolidate 70 federal programs within the Department of Transportation and promotes the capitalization of state infrastructure banks instead of one national bank. House Republicans said recently that they are open to spending more on roads and infrastructure, provided that the additional funding is paid for by cuts from other programs.

Assuming that Senate Democrats and House Republicans can reach an agreement on funding levels, there remains a lot of disagreement on how to fund the bill. The fuel tax – which has not been raised since 1993 – is the largest revenue source for bridges and highways. However, Federal outlays have exceeded fuel tax receipts since 2000, creating a pressing need to find alternative revenue sources. The Highway Trust Fund has narrowly escaped insolvency three times since then, with Congress providing a bailout of $35.5 billion. Chairman Mica opposes any increase in the fuel tax, whereas Senator Barbara Boxer (D-CA), the Chairman of the Senate Environment and Public Works Committee, supports the idea of pegging the fuel tax to inflation.

With a fuel tax adjustment off the table, how to fully fund the next surface transportation authorization remains a $230 billion question.

The Benefits of Going Long


 

As the Port Authority of New York and New Jersey prepares to sell $1 billion in general obligation bonds today to finance the construction of the World Trade Center complex, NYU Urban planning professor and director of the Rudin Center for Transportation Policy and Management Mitchell Moss explains that there is no better time than now for public agencies to take out long-term, low-interest debt.

Read Mitchell Moss in today’s Bond Buyer.

Image: Silverstein Properties