Reason Foundation

September 4, 2016

Top Story

Expanding Toll Bridge Will Reduce Alabama Coastal Congestion

Widening toll bridge over Portage Creek ensures users pay cost

Baruch Feigenbaum

Alabama’s white-sand beaches at Gulf Shore and Orange Beach are becoming increasingly popular tourist destinations. As a result new bridge capacity is needed. Widening tolled Foley Beach Express bridge solves capacity issue without overburdening taxpayers.

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Surface Transportation News #154

Can P3 infrastructure help pension funds?

Robert Poole

In this issue:

• Can P3 infrastructure help pension funds?
• Will autonomous vehicles transform urban areas?
• Making sense of Tesla safety claims
• Disrupting urban transit
• Tolling interoperability being achieved 
• Upcoming Transportation Events  
• News Notes
• Quotable Quotes

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Pension Reform Newsletter - August 2016

Pension divestment, the "new normal," accounting rules and U.S. public pension risk-taking, pension investment in infrastructure and more

Leonard Gilroy, Anthony Randazzo

In This Issue:

• Pension Boards Should Focus on Returns, Not Divestment
• For Public Pensions, Past Performance No Guarantee of Future Results
• Accounting Rules Create Perverse Risk-Taking Incentives for U.S. Public Pension Funds
• Pension Fund Investment in P3 Infrastructure
• More Participant-Elected Pension Board Members Associated with Lower Bond Ratings
• Pension Underfunding in Alabama
• Sonoma County (CA) Pension Advisory Committee Update
• Glossary of Pension Terminology

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Pension Reform Case Study: Michigan

Reforms in Michigan have benefited both taxpayers and state employees

Anthony Randazzo

In 1996, the Michigan state legislature passed a first-of-its-kind bill that closed the state employees’ defined benefit pension fund to new members and created a defined contribution pension system for future hires. In retrospect, the decision seems highly prescient. Pension reform in Michigan has meant the State Employee Retirement system is more solvent today than if the legislature had not closed the defined benefit plan for new hires, with a full system funded ratio of 88% as of 2015, compared to an estimated 68% funded ratio without reform. However, while Michigan provides valuable insights for how to pursue adopting pension reform—such as taking sufficient time to fully analyze a pension plan’s problems, avoiding conflict by communicating with all parties, and having determined elected officials leading the effort—the state has also provided an example of how not to manage the implementation of pension reform.

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The Case for Stopping Honolulu Rail Dead in its Tracks

Rail line costs increase from $2.7 billion for 34-mile line to $7 billion for 15-mile line

Cliff Slater

Increasing costs and inflated ridership numbers make Hawaiian rail project a monumental waste of money. Yet politicians keep pressing ahead with the rail project. Spending the resources on highway projects that the Governor just cancelled would be a much better use of funding. 

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Pension Fund Investment in P3 Infrastructure

Investment in P3 infrastructure continues to be a major global trend, and public pension funds are emerging as key players.

Robert Poole

Pension fund investment will likely be the key that unlocks US asset recycling, greatly expanding the market for long-term revenue-risk concessions. 

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Testing a Better Way To Pay For Roads

California launches a new “Road Charge Pilot Program” to test replacing the gas tax that drivers pay at the pump with a fee based on the number of miles they drive.

Adrian Moore

A well-functioning road system is essential to our lives, job prospects, state economy and mobility, so developing and implementing a sustainable method of funding the transportation system would be a major boost to the state.

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New Jersey Senate Appropriations Committee Testimony

Testimony from hearing details New Jersey's exorbitant spending on roadways and provides suggestions on stretching resources further

Baruch Feigenbaum

Over the past few years leaders of the New Jersey Department of Transportation have argued that Reason's Annual highway report inaccurately portrays New Jersey's roadway costs. This testimony delivered to the Senate Appropriations Committee explains that while every state is different, by any measure New Jersey's roadway costs are among the highest in the country. Further, given New Jersey's high costs, a gas tax increase is not appropriate until the state makes substantial reform. Finally, the testimony suggests five ways New Jersey DOT can cut costs and become a 21st century DOT. 

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