System Failure
By Timothy Psomas
Our nation’s leaders must address the deteriorating state of the U.S. transportation system. The serious backlog of transportation improvement projects is undermining our ability to stimulate economic recovery and remain globally competitive.
The current surface transportation-funding bill expired on September 30, 2009. This bill allocated $280 billion spread over six years, and it’s out of money. The authorization by Congress of a new transportation bill, now in the House Transportation Committee, would establish a funding level of $450 billion for the next six years. The Obama administration, however, is pushing for an 18-month delay. That gets us into the pre-election season, where there will be too much competition on the political agenda from issues like healthcare, global warming and reducing the national debt. Realistically speaking, we are facing a 24 to 36-month delay in getting a new transportation-funding bill through Congress.
There is no incentive for transit agencies or departments of transportation to initiate long-term projects without a reliable funding source on the horizon. As a consequence, we will end up with minor projects as opposed to adding capacity.
This is a delay we as a nation can’t afford. Transportation funding will create jobs and stimulate the economy. A high-functioning transportation network is critical for the efficient movement of goods throughout the country and to increase worker productivity by reducing time spent stuck in traffic.
Of the $788 billion Stimulus Plan, only $37.4 billion was appropriated for highways and transit. Much more needs to be done to address the serious backlog of transportation improvement projects. Current budget forecasts project a 50 percent cut in the highway program in FY 2010 without new revenues into the Highway Trust Fund. This funding shortfall will only exacerbate persistent problems of overburdened transit systems, congested roads and deficient bridges. Implementing a stable and growing financing mechanism for transportation projects must be a key priority.
It’s time that the public sector took a fresh look at alternative means of financing transportation projects. And one highly viable financing option is public-private partnerships. Given the serious financial constraints affecting state and local agency budgets, the idea of leveraging public money with private financing is finally taking off. Public officials now realize there is room for the public and private sector to join together to get projects off the ground.
In other parts of the world public-private partnerships are commonplace: Spain, France and Australia for instance. In the U.S., public-private partnerships have taken a foothold in Texas, Virginia, Florida, Illinois, and Nevada. For the first time in California, public agencies are taking public-private partnerships seriously. New state laws in California finally have opened the door to the financing that these partnerships would provide.
For example, one very promising opportunity for a public-private partnership is the planned 800-mile high-speed train system from Southern California to the Bay Area, which is currently in preliminary design. California voters passed a $10 billion bond measure to finance the project, with another portion of the estimated $40 billion cost to come from federal sources. Some $4.5 to $7 billion is anticipated to come from public-private partnerships. Private sector involvement would not only contribute a portion of the financing, but also would bring the hard business expertise to ensure a workable business plan.
Unfortunately a new bill now before the Senate Committees on Environment and Public Works and Finance, S. 884, will penalize states that turn to public-private partnerships to fund transportation projects. If adopted, the bill would reduce the funding these states receive through the Highway Trust Fund by changing the grant allocation formulas for several programs to exclude privately operated facilities.
As the S.884 illustrates, there are still obstacles in the face of widespread support for public-private partnerships. Gaining such support will require a major education campaign. There is a great deal of misinformation spread by the major opposition, the public employee unions. The unions are concerned about loss of control—fearing that once the private sector gets its foot in the door, the public sector loses control over design, construction and operation. It will take a concerted effort by a coalition of engineers, transit agencies, departments of transportation and financial interests to the provide education and lobbying needed to demonstrate that these kind of partnerships can and will work.
The current dismal state of public agency coffers is giving us the opportunity to develop the track record and mutual trust that public-private partnerships are a viable means of addressing our nation’s transportation needs.
Timothy Psomas is the chairman of the board of Psomas, a consulting engineering firm headquartered in Los Angeles with offices across the Western United States. He is also the current Chairman of the American Council of Engineering Companies, which represents more than 5,000 firms throughout the county.
October 16th, 2009 at 3:03 pm
It’s time to put your money where your mouth is; Operation Lifesaver and a few TV ads are not going to fix the public perception of the railroads. In days of old, passenger trains allowed the public to safely see how the goods of our economy moved. Today’s Amtrak trains are few and far between, beleagured and disrespected by the big business of moving freight. We discourage the public from going anywhere near the rails, and then we wonder why the public doesn’t think of railroads as a public service. We claim that railroading benefits everyone, and we say the USA needs better railroads, but you can’t photograph them, you can’t even stand on the platform without a ticket. We must stop asking people to leave the railroads alone, or that’s exactly what will happen.
December 29th, 2009 at 5:51 pm
I wish I could show my proposal for the new PATH rail system that I had created in an Urban Planning class at Rutgers. (to link Middlesex County to Staten Island New York)
You’re absolutely right, NJ Transit and MTA are going broke and cutting service because their funding from the states is practically nil, unlike in Connecticut.
Too many people are complaining about their taxes going up to fund mass transit projects. They don’t ride the transit because (1) they’re too lazy to walk a few hundred feet (2) there’s not enough frequency in service to satisfy their schedule and (3) they often have to make multiple transfers, some of which take them entirely out of their way.
We need to get more trains running in these urban areas, starting with the thickest and most transit lacking areas.
People think there’s really no call for a rail line between any two cities. “You’re gonna build mass transit where nobody is gonna ride it”
News flash: You don’t wait until there is a call for it, because by then it’s too late, and you need to either knock down houses and buildings, or build the tracks underground. When there is adequate service, the developers will see dollar signs and ridership will go up.
I know what is feels like to have no car and to rely on public transit where service is highly inadequate.
Not only that, but some people were just not meant to drive (according to insurance companies), but that doesn’t mean that they shouldn’t be able to get around from place to place.
Putting more buses on the road is not the answer, they burn oil just like cars, can get stuck in traffic making them unreliable during rush hours, and are not easily handicap accessible.
One of the dumbest things I once heard someone say was that by building rail transit, we’re using a 19th century solution for a 21st century problem. Come on, I think construction workers are just too lazy to build train tracks, bridges and tunnels, and that people don’t wanna spend the money to build the tracks because of the recession. Another News flash: the construction of the subways in New York and other cities actually helped us get out of the great depression because it created jobs for people
December 25th, 2010 at 7:49 am
you really pin point the real things.i agree with your views.