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Vol. 15, No. 3; May 2004

The House Reauthorization Bill
The passage by the House of a $284 billion bill (H.R. 3550) to reauthorize surface transportation programs has not ended the uncertainty or speculation concerning the ultimate outcome of the authorization measure. To begin with, congressional negotiators have to resolve several major differences between the House bill and its Senate version (S. 1007), notably the funding level and the formula used to allocate highway funds to each state. Secondly, the White House objects to the bill because it is $28 billion above the President's request and because it contains a provision that would allow Congress to reopen the measure in September 2005 for additional funding and thus effectively transform the six-year authorization into a two-year bill. While both the Senate and the House appear to have enough votes to override a Presidential veto, neither Congressional Republicans nor the White House look forward to a potentially embarrassing election-year intra-party fight, and hope that a negotiated compromise is still possible.


Reinventing Highway Financing
Nearly one year ago we suggested that "the time has come to take a new look at tolls as a source of highway funding to supplement the dwindling revenues from the gasoline tax." (Innovation Briefs, May/June 2003). Over the past 12 months tolling has indeed emerged as a subject of intense interest, culminating in a major "Transportation Finance Summit" held on March 3-5 under the sponsorship of the International Bridge, Tunnel and Turnpike Association (IBTTA). Attended by some 300 toll road officials and transportation practitioners, the IBTTA Conference served to throw a spotlight on the widening gap between demand and supply of highway funds and on the need to explore additional revenue sources to support long-term highway financing requirements.


It's Time To Take a Fresh Look at the "New Starts" Program
What concerns thoughtful rail critics – and not all critics are anti-rail ideologues –is not so much the past as the future. In their view, the number of urban areas that can justify rail investment is shrinking with every passing year— or rather with every award of a federal full funding grant. Indeed, it can be argued that all the "low-hanging fruit" – i.e. cities whose corridor densities make rail service potentially cost effective – have by and large already been picked. What remains are projects with questionable qualifications. The evidence of this is already appearing in FTA's FY 2005 budget request. In it, the agency proposes to award full funding grants to two projects – Cleveland's Euclid Corridor and Pittsburgh's North Shore LRT Connector – that received a "Low" rating for cost-effectiveness (and thus would not have qualified for federal funding) only a year earlier. Three other projects recommended for funding – Phoenix, Charlotte and Raleigh/Durham– appear marginally qualified, based on their average population densities, expected traffic density and dubious cost-benefit ratio.

It has been said that the Federal Transit Administration "has never met a New Start project it didn't like." Or, as we remarked in an earlier Brief, in FTA's rating game there is no such thing as a failing grade: all projects, to paraphrase Garrison Keillor, eventually end up "above average." But Congress also is to blame. For as long as it keeps authorizing an unending stream of new rail projects and filling the pipeline with authorizations for fresh alternatives analysis/preliminary engineering studies (there are 143 such studies authorized in the House bill!), the Federal Transit Administration has no reason to turn down rail projects no matter how poorly justified and wasteful those investments might turn out to be.


The Age of the Great Dispersal:
Despite "Smart Growth" Entreaties, Outward Migration Continues
Attempts to artificially throttle suburban growth through "smart growth" policies have been unsuccessful, according to recently released Census data. "We are living in the age of the great dispersal" writes David Brooks, an astute observer of demographic trends, in a recent article ("Our Sprawling, Supersize Utopia," New York Times Sunday Magazine, April 4, 2004). "Americans continue to move from the Northeast and Midwest to the South and West, but the truly historic migration is from the inner suburbs to the outer suburbs, to the suburbs of suburbia. From New Hampshire down to Georgia, across Texas to Arizona and up through California, you now have the booming exurban sprawls that have broken free of the gravitational pull of the cities and now float in a new space far beyond them."

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