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Vol. 15, No. 8; Nov/Dec 2004 - Vol. 16, No. 1; Jan/Feb 2005

The Federal Surface Transportation Program: The Next Four Years

Transportation policy often passes under the radar of political analysts and media commentators, overshadowed as it is by such major concerns as the fight against terrorism, the economy, the future of social security, and health care. This posture of benign neglect should not continue. Mobility is too important to the economic vitality of the nation to remain invisible in the policy dialogue. Raising the profile of transportation is especially timely at this juncture, as the President prepares to shape the policy agenda for his next administration and Congress returns to the unfinished task of reauthorizing the federal surface transportation program.

We, at Innovation Briefs, intend in our small way to contribute to this dialogue. To this end, we have invited three colleagues—Stephen Lockwood, Alan Pisarski and Robert Poole— to join your editor in taking a forward look at the federal surface transportation program and weigh the transportation choices facing the Administration and the Congress over the next four years.

All four of us were members of President Bush’s Transportation Policy Team and helped to frame the issues and develop policy positions that guided the first presidential campaign. Later, all of us went on to serve as members of the Bush-Cheney transportation transition team. Eighteen months ago, we revisited the Policy Team’s work and assessed in these pages the status of the federal surface transportation program at the mid-point in the Administration’s term of office. We were pleased to conclude at that time that the U.S. Department of Transportation had closely embraced the vision expressed in the Team’s September 1999 recommendations (see, “The First Five Hundred Days: A Mid-Point Assessment,” Innovation Briefs, Vol. 14, No. 4, July/August 2003).

Our purpose this time around is twofold. First, we wish to extend a “well done” to the policy team at the U.S. Department of Transportation. The Department’s policy development process over the past four years has been marked by creativity and imagination and its senior team is to be congratulated for bringing fresh insights and innovative thinking to the management of the federal surface transportation program. Secondly, we wish to offer a few thoughts concerning the stewardship of the federal transportation program during the next four years. We believe creative ideas are needed to effectively address the Nation’s transportation challenges as the Bush Administration embarks on its second term of office and the 109 th Congress resumes work on the surface transportation reauthorization.


Transportation Referenda

Faced with rising transportation needs and uncertain prospects for more help from Washington, voters in numerous communities across the country turned to ballot initiatives to support transportation. A total of 55 transportation-related initiatives were on the November ballot. Of those, 42 totaling some $30 billion were approved. The returns prove that voters are willing to tax themselves for transportation improvements when they are convinced that the funds will be spent wisely on investments that truly contribute to mobility.

Transit advocates have been particularly pleased by the approval of some 80 percent of all the public transit initiatives, including a $4.7 billion measure to add 119 miles to Denver’s existing regional light rail system. But the Denver “FasTracks” proposal has met with criticism from unexpected quarters. Smart growth proponents allege that the rail extensions, with their 57 suburban stations, will exacerbate sprawl in the metropolitan area. Far from concentrating population in the city, as transit is supposed to do, they claim FasTracks will disperse population over a vast region along the Front Range, leading to more exurban sprawl and increased auto use.


The Politics of Exurbia

Can the results of the November elections be explained by demographic trends? Specifically, what influence did urban decentralization and exurban growth play in the Republican victories? Some of the answers are contained in a post-election voting analysis carried out by the Los Angeles Times. The analysis shows that President Bush carried 97 of the nation’s 100 fastest-growing counties, most of them exurban communities that have sprung up on the periphery of major metropolitan areas. Bush won 63 percent of the votes cast in these counties, carrying 40 of them by more than 70 percent. Stretched across 30 states, exurban counties grew cumulatively by more than 16 percent in the period between the presidential elections of 2000 and 2004, more than offsetting Democratic gains in the cities and inner-tier suburbs (“GOP Plants Flag on New Voting Frontier,” Los Angeles Times, November 22, 2004).

New York Times columnist David Brooks, an astute observer of demographic trends, thinks these sprawling exurbs have become the conservatives’ new bastion. Filled largely with younger families fleeing urban centers in search of affordable homes, better schools and a more livable environment, they are solidifying GOP control in red states and making inroads in blue Democratic-leaning states such as Minnesota and Wisconsin. “The Republicans won in part because Bush and Rove understand this [exurban] culture,” Brooks notes. His perceptive analysis is reprinted below.


Toll Financing Is Gaining In Popularity

Two early December events underscored the growing interest in tolling as a tool of highway financing. Toll projects–existing and proposed–were the focus of the 16 th Annual Conference on Public-Private Ventures in Transportation, sponsored by the American Road & Transportation Builders Association in Washington on December 8-9; and the future of tolling was the subject of a December 9 luncheon seminar hosted by the Heritage Foundation. The luncheon featured a preview by Robert Poole and your editor of a chapter on tolls they co-authored for an upcoming Heritage Foundation book on federal surface transportation policy. The 21 st century toll roads will bear little resemblance to the turnpikes built during the past half century, speculated Robert Poole. The priced roads of the future will take innovative new forms such as High Occupancy Toll (HOT) lanes, Express Toll Lane Networks with Bus Rapid Transit service, Toll Truckways and electronic toll roads. They will be built under novel financial and organizational arrangements such as public-private partnerships, long-term franchises modeled after private utility networks, and Texas-type Regional Mobility Authorities using a mix of public and private funding.

Interest in tolling is rising not only in state DOTs but, importantly, in Congress and among local elected officials, noted Ken Orski, also at the Heritage Foundation luncheon. The reasons are several. First and foremost, states and local governments have no other obvious source of additional highway revenue to fall back upon. Given the need for more highway funds and given the widespread opposition to raising the gas tax, tolls have come to be considered as a logical means of augmenting traditional highway funding. Second, variable tolls are seen as an effective tool of congestion management. This has made tolls popular with local elected officials who are under pressure from their constituents to “do something” about traffic congestion. Third, there is growing evidence that the public not only does not object to, but welcomes the option of priced lanes that offer premium service: the populist criticism, that priced lanes are “only for the rich,” is no longer taken seriously, when surveys show that motorists of even modest means choose to use priced lanes when they are pressed for time. Fourth, most transportation user groups have become vocal advocates of tolling. And last but not least, tolling has received strong support from the Bush Administration. Without the U.S. Department of Transportation’s advocacy, toll financing may never have reached its current prominence, political credibility and congressional support, said Orski.

The Department’s advocacy was on full display at the ARTBA Conference, with both Transportation Secretary Mineta and FHWA Administrator Mary Peters speaking in favor of giving States the option of charging road user fees. Ms. Peters’ remarks, in abbreviated form, are reprinted below.


The Emerging Influence of the “Micropolis”

Is population density an indicator of how people will vote? Yes, asserts Robert E. Lang, Director of the Metropolitan Institute at Virginia Tech, in a recently published analysis of 2004 voting patterns (Micro Politics: The 2004 Presidential Vote in Small-Town America, Metropolitan Institute Census Note 04:03, November 2004). President Bush was the overwhelming choice of residents of lower density “micropolitan” areas – a new census category that describes quasi-urbanized areas that lie beyond the exurbs but are not quite rural in character. John Kerry, on the other hand, won the popular vote in densely populated central cities and in older, inner ring suburbs. Bush carried low density micropolitan areas even in the Democratic “blue” states– areas such as upstate New York, downstate Illinois and inland California, while Kerry won urbanized areas even in the Republican “red” states.


Are Congressional Earmarks in Jeopardy?

Rep. Don Young (R-AK), Chairman of the House Transportation & Infrastructure Committee, does not give up easily. In a “Dear Colleague” letter to House members dated December 10, 2004, co-signed by Ranking Minority Member James L. Oberstar (MN-D), he is once again soliciting applications for projects “that are of significant importance to the improvement of our Nation’s surface transportation infrastructure.”...The invitation of the House T&I Committee leadership will undoubtedly reignite the debate about the wisdom of congressional earmarks. The so-called “high priority projects” were a subject of much criticism during the last session of Congress (see, “The Congressional Earmark Explosion,” Innovation Briefs, Sep/Oct 2004) and they are likely to be scrutinized even more closely during the coming congressional session because of fiscal constraints confronting the authorizers.


The Chicago Skyway Lease: A Harbinger of Future Revenue Deals?

In a potentially groundbreaking deal, the City of Chicago has entered into a 99-year $1.82 billion contract to lease the city-owned Chicago Skyway to a private consortium. ...What makes an existing publicly owned toll facility potentially attractive to private investors? According to financial experts we button-holed at the recent American Road and Transportation Builders (ARTBA) Conference, the deal must meet several basic conditions: Among them: (1) the facility must be situated in a congested travel corridor and have spare capacity to accommodate increased volumes of traffic; (2) the contract must permit a gradual increase in tolls to a level warranted by market demand; (3) the contract must permit the operator to manage traffic and optimize vehicle throughput on the facility, using variable tolls; (4) expansion of alternate routes is limited by physical or environmental constraints; or, alternatively, the contract provides for protection against the development or improvement of alternative parallel routes.


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