MEMBERS of the truck and trailer industry are stake-holders who should play a role in the “serious reform” of the transportation system's funding mechanism, according to US Department of Transportation chief of staff John Flaherty.
Providing the “Government Update” at Heavy Duty Aftermarket Week January 23-26 in Las Vegas, Nevada, Flaherty said transportation fuels economic growth and vitality, and there is a connection between investing in transportation and investing in the nation's continued prosperity. But that connection is being compromised by the growing gap between the demands of transportation and the capacity of its infrastructure and the investments to meet that demand.
“Today's government at all levels is spending more than it's raising,” he said. “For us, it's in government taxes and other user fees. With highways, there's a negative gap between revenue and expenditure between 1985 and 2003. Financially, the picture is getting bleaker.
“It's time to revolutionize the way transportation does business in America. We've done it once before. We can do it again. This year, we saw the 50th anniversary of the Interstate highway system. The 20th century was an era of unparalleled economic growth, unprecedented freedom of movement, and unequaled connectivity. Twenty years ago, the traditional model shifted. Connectivity still is important, but congestion is a considerable challenge. In the late ‘80s, policymakers recognized the shift and revolutionized how transportation was funded.”
He said the Intermodal Surface Transportation Efficiency (ISTE) Act, passed by Congress in 1991, addressed the needs by acknowledging that the nation could no longer view highways in isolation. It required the nation to make funding decisions “with the view that highways were part of a larger network that moved people and products on a daily basis.” It also emphasized decentralized decision-making by extending state and local roles in transportation planning.
“With the help of ISTE and its successor, TEA-21, America moved forward for nearly a decade,” he said.
Capacity is critical
He said that with the rapidly developing global economy, America's leaders know that capacity — and in particular, a heavy system that has intermodal capacity to move freight — is critical to the nation's economic security.
He said we did not anticipate the rapidity of globalization and the demands and strains it would put on the nation's capacity.
“We know that capacity is closely linked to congestion in our urban centers,” he said. “The issue before us now is: ‘How can we help include that intermodal system of delivered goods and services to America's homeowners and businesses?’”
He said there are some “troubling aspects” to the $286 billion highway bill passed last July.
“The bill took 13 extensions to get done,” he said. “That usually means there's some conflict in terms of how it's worded. It wasn't just a case of money.
“Earmarks are designated projects. In 1982, in the Transportation Authorization Bill, there were 10 earmarks. In 1987, there were 157. In 1991, 538. In 1998, 2800. When the bill was signed last year, there were 6371 earmarks. It's difficult to do transportation planning when you're being told where to spend the money by members of Congress, whose top priority may be more where their district is than the overall nation's plan.
“Many highway experts have predicted that in 2009, our highway funding will run out unless we raise taxes — a gas tax. There has to be a way we can do this other than raising the number of earmarks and raising the gas tax. Congress put in a commission whose job is to look at how we'll do transportation planning in the next decade. As in '91, this may require a new way of thinking.”
He said when President Bush signed the highway bill passed last year, it authorized spending for programs and projects that improve safety and enhance efficiency.
“We hope it will be a catalyst for something more — something that begins to transition 21st -century transportation in America,” he said. “We want to do that by embracing an enhanced role for the private sector and expand our transportation network. We believe the private sector will play a principal role in these public projects. We're trying to advance public/private partnerships as a practical way to move America forward. Our global neighbors have done that.”
He said it could be structured to provide incentives for better budgeting, faster project delivery, and improved management of new and existing transportation facilities.
He cited two models:
The Dulles Greenway, a privately owned 14-mile toll road connecting the Dulles Toll Road with Leesburg, starting at Route 28 near Washington Dulles International Airport and ending at Route 15 in Leesburg. He said revenues have grown by 26% a year because “travelers have found it to be a more convenient way to get around the congested area.”
The Alameda Corridor, a 20-mile-long rail cargo expressway linking the ports of Long Beach and Los Angeles to the transcontinental rail network near downtown Los Angeles. It is a series of bridges, underpasses, overpasses, and street improvements that separate freight trains from street traffic and passenger trains, facilitating a more efficient transportation network. The project's centerpiece is the Mid-Corridor Trench, which carries freight trains in an open trench that is 10 miles long, 33 feet deep and 50 feet wide between State Route 91 in Carson and 25th Street in Los Angeles.
“The project was groundbreaking in vision,” Flaherty said. “It used federal money to leverage private-sector investment. It led to the creation of a federal credit assistance program, Transportation Infrastructure Finance and Innovation Act of 1998 (TIFIA), that is stimulating capital investment in transportation projects all across America.”
Flaherty said the federal government is trying to remove roadblocks for private-sector investment, but only 19 states have public-private partnership laws that allow for the creation of these types of entities.
“There's a need for the entire private sector to get in the game or risk being left behind,” he said. “The sector is not only one of transportation's longest customers, but also one of the largest. The trucking industry is a perfect example: more than nine million employees. The trucking industry has a vital say in transportation's future. We need your support and your participation as we move forward to revolutionize the way the transportation business is done in America.
“We need direct participation in Washington, DC; become involved with local members of Congress. And don't wait. Start this year. Authorization may be only three to four years away. Everything tells us that the debate on how the next re-authorization bill is going to be done is going to start this year. How transportation is designed will be as dramatically shifted as in '91.”