The “Bottom Line” on Investment Needs For Our Transportation System

The Environmental and Energy Study Institute (EESI) and the American Public Transportation Association (APTA), in conjunction with the American Association of State Highway and Transportation Officials (AASHTO), held a briefing on the investment requirements for America's multi-modal transportation infrastructure.

The recent AASHTO-APTA Bottom Line report estimates that $163 billion is needed annually over six years to fix the nation’s aging surface transportation system ($120 billion for roads and bridges, and $43 billion for transit). At present, public investment in transportation infrastructure is only $100 billion a year ($83 billion for roads and bridges, and $17 billion for transit). With the looming May expiration of the transportation bill, Moving Ahead for Progress in the 21st Century (MAP-21), and with 70 million new U.S. citizens expected by 2050, now is the time to address these investment needs.

There is little disagreement over the importance of the nation's transportation infrastructure. And yet, the Bottom Line report highlights a massive gap between what investments are needed and what is actually being spent. According to the U.S. Department of Transportation, two-thirds of the nation's roads are not in good condition—and deficient roadways are a significant factor in one-third of all highway fatalities. One quarter of U.S. bridges need major repairs or upgrades.

Lack of capacity is also a big problem. Almost half of all Americans lack access to public transit services. Congested roads cause Americans to lose 5.5 billion hours in traffic every year, representing more than $120 billion in wasted fuel and lost time. Congestion, most severe in urban areas, also increases the cost of delivering goods by $27 billion year and causes shipping delays. As the nation's population grows, this cost will grow quickly if the country continues to underfund investment in transportation infrastructure.

Finding long-term, consistent revenue streams to invest in the country's transportation infrastructure is key to America's competitiveness, economic growth, and job creation.

The Bottom Line report is available at www.apta.com/mediacenter/pressreleases/2014/Pages/1412.aspx and bottomline.transportation.org.

 

Briefing Highlights

• Bud Wright, Executive Director, American Association of State Highway and Transportation Officials (AASHTO), outlined the main points of the Bottom Line report commissioned by AASHTO and the American Public Transportation Association (APTA).
• The Bottom Line report is based on the forecasting models, data systems, and analyses used by the Federal Highway Administration and the Federal Transit Administration (FTA) along with supplementary research.
• Current capital investments in highway and transit networks by all levels of government in the United States is $105 billion annually, but $59 billion more is required to improve the system and keep up with rising demand. Just for highways and bridges, $120 billion per year is required over the next 6 years, compared with current funding of just $88 billion per year. For transit, $43 billion per year is needed compared a current investment of $17 billion per year currently.
• Total operating and capital spending on highways is $156 billion per year. Only one fourth of that amount is covered by the federal government.
• States have stepped up to the plate and increased their infrastructure investments, but collaboration with the federal government is necessary to achieve infrastructure improvements with a clear, integrated national vision.
• Since the 1950s, the number of vehicles on the road has quadrupled, and our infrastructure has struggled to keep pace with such tremendous growth.
• Every dollar invested in highways or transit returns two to three times that amount back to the economy. Transportation system improvements would benefit the average American household by more than $5,000 every year in extra income, through access to more job opportunities, lower personal transportation costs and reduced goods costs due to lower freight transportation costs.
• The current federal surface transportation authorization legislation (MAP-21) expires May 31, yet there is currently no plan for addressing this transportation infrastructure crisis. Without this transportation investment we are making the country weaker.
• Mike Melaniphy, President and CEO, American Public Transportation Association (APTA), showcased the urgent need for transportation and infrastructure investment in order to reduce the large investment gap that has developed and to reestablish the United States as an efficient transportation nation.
• It is critical to look at transportation as a system with all modes working together as a network.
• An investment of $163 billion annually is necessary to fix our current infrastructure and transportation system over the next six years, but the current rates of investment are set to create a tremendous gap in what needs to be improved and what can be improved.
• The FTA determined recently that the “state of good repair” backlog alone is $88 billion.
• With MAP-21’s imminent expiration (May 31), not only is it critical to renew base funding, but a long term plan is also necessary to improve our transportation system.
• In 2013, the United States saw the highest ridership in public transportation since 1956, with upwards of 10.8 billion trips.
• Since 1995, there has been a 21 percent increase in the nation’s population, a 25 percent growth in vehicle miles traveled, and a 39 percent growth in public transit.
• Investments in infrastructure and transportation have a significant economic impact:
  • For every $1 billion spent, 21,000 construction jobs are directly created, but when the productivity effects of the investment are included, more than 50,000 jobs are created.
  • The $61 billion transit industry has 400,000 employees across the nation
  • 73 percent of federal spending on transit goes to the private sector to build vehicles and infrastructure.
  • From 2008-2013, residential housing prices were 42 percent more resilient along high frequency transit corridors. The value of property there is equivalent to the value of oceanfront property.
• The culture of transportation is changing as millennials enter the workforce. Seventy percent of millennials prefer to live in places that offer transportation choices, including public transit, walking, and biking.
• More certain long-term government investment and more uniform public/private partnership policy is needed to effectively compete with other nations for global investor funds
• It has been over 20 years since the last gas tax increase. The gas tax, which funds U.S. infrastructure and transportation systems, has not kept up with inflation. The health of America’s infrastructure and economy depends on Congressional action on the expiring transportation bill.