Reason Foundation

New at Reason: Looking Back at the Last Year in Toll Roads, HOT Lanes, Infrastructure Finance

Posted on April 8, 2013, 9:00am | Leonard Gilroy

The rollout of Reason Foundation's Annual Privatization Report 2013 continues today with the release of the Surface Transportation section—authored by Reason's Robert Poole—which provides a comprehensive overview of the latest on toll roads, HOT lanes, infrastructure finance and other news on privatization and public-private partnerships in surface transportation. Topics include:

• Federal Reauthorization—MAP-21
• State Public-Private Partnership Enabling Legislation
• Transportation Infrastructure Finance 2012
• Private Activity Bonds
• Major Public-Private Partnership Highway Projects
• Leasing Existing Toll Roads
• Managed Lanes and Networks

And in case you missed it, Reason Foundation released the Air Transportation section of the Annual Privatization Report 2013 last week, also authored by Poole. It offers an overview of the latest on privatization and public-private partnerships in air transportation, with topics including airport privatization, U.S. airport security, and air traffic control.

» Annual Privatization Report 2013: Surface Transportation
» Complete Annual Privatization Report 2013

How to Reform and Get More Value From Federal Transportation Programs

Posted on January 9, 2013, 1:00pm | Robert Poole

As Congress grapples with impending budget cuts, we need to do a fundamental rethink of how the federal government assists with much-needed transportation infrastructure. The reality going forward is that there will be no such thing as “general revenue” funding for much of anything beyond entitlements, defense, and interest on the national debt. As long as the federal budget remains grossly unbalanced, general-fund investments in infrastructure are essentially borrowed from China—an unsustainable situation.

Three key principles are necessary for a sustainable federal role in infrastructure:

1. Users should pay for the infrastructure they use;
2. Large capital projects should be financed, via revenue bonds and other mechanisms; and,
3. The federal role should be narrowed to do only things that are truly interstate in nature, which means shifting more responsibility to the states, metro areas, and the private sector.

Reason Foundation’s new policy brief, “Funding Transportation Infrastructure in a Fiscally Constrained Environment,” explains why the model used for federal transportation programs—user taxes feeding centralized trust funds that make annual grants for cash-based investments, increasingly subsidized by general-fund money—needs replacing:

• Because these user taxes are seen as taxes, Congress seldom increases them, even when their real value declines due to inflation and other factors.
• Each transportation program involves large cross-subsidies, in which some users pay for other users’ projects, often for projects of low real value.
• Federal money comes with costly strings attached, such as Davis-Bacon and Buy America requirements, needlessly raising the cost of federally aided projects.
• Federal programs over-emphasize new capacity, leading to large amounts of deferred maintenance on existing infrastructure.
• Most federal programs encourage state and local governments to fund large capital projects out of annual cash flow, rather than financing them over time, as businesses (and home-buyers) do.

The report sets out a comprehensive set of organizational, tax policy, and regulatory changes that would implement the above principles, thereby ensuring needed, cost-effective investment in airports, air traffic control, highways and bridges, ports and waterways, transit, and passenger rail.

Airports already make use of much of the proposed approach, and the report recommends that airports be liberated from federal grant funding by being allowed to self-fund their runway and terminal expansion projects. The only thing Congress would have to do is to remove the federal cap on individual airports’ passenger facility charges, which would enable airports to expand their revenue bonding abilities for such projects. Eliminating airport grants for passenger airports would save $2 billion a year.

The air traffic control system could easily be self-supporting from fees and charges, as are the air traffic control systems in Western Europe, Australia, Canada, and even South Africa. A decade ago Congress reorganized the Federal Aviation Administration, creating the Air Traffic Organization (ATO) within it. The ATO should be separated from FAA as a government or nonprofit corporation, funded and governed by its users and regulated for safety by the FAA.

The Highway Trust Fund (HTF) should be refocused on interstate commerce, rather than trying to do surface transportation at all levels of government, from sidewalks and bike paths to urban transit to recreational trails. Its revised focus should be the Interstates and others that make up just the National Highway System. Thus refocused, the HTF would no longer need the large general fund subsidies provided since 2007. To help states accommodate their enlarged responsibilities, the remaining federal barriers to states use of tolling should be abolished, and a larger share of federal aid should be in the form of loans via the TIFIA program, rather than grants.

The Harbor Maintenance Trust Fund is broken, but not only because Congress spends only half the money generated by the Harbor Maintenance Tax each year. It is also broken because it takes money from ports that don’t need significant dredging and spends it on ports that do. But since all ports are in competition with one another, that policy makes no sense. Each port should self-fund whatever dredging it needs, with the cost being borne by that port’s users.

Federal waterways policy is even less sustainable, since the diesel tax paid by commercial carriers covers only eight percent of federal spending on channel dredging and lock-and-dam capital and operating costs. Waterways interests are calling for large increases in federal general fund support, but even the research arm of the Army Corps of Engineers has suggested the alternative of self-funded waterways, with larger user fees making possible revenue bond financing of needed improvements.

Passenger rail is problematic, because airlines and bus lines provide basically unsubsidized service to the vast majority of inter-city passengers. Where niche markets for passenger rail exist (e.g., the Northeast corridor), passenger fares and related real-estate value-added should become the means of support. The private sector may have a role to play in such service, especially if Congress deregulates post-Amtrak rail labor.

Urban transit, while playing an important role, is quintessentially the responsibility of specific urban regions, which derive all the benefits from such service. Federal funding has biased many transit investment decisions away from cost-effective bus and bus rapid transit projects to very costly and not very effective rail projects. Subways and commuter rail have a key role to play in very dense urban areas with large traditional central business districts, but that description applies to only a handful of America’s largest urban areas.

In short, federal transportation infrastructure programs are in dire need of major reform. This is not simply because the federal government is running out of discretionary funding. It is also because all of these programs misallocate resources. What this country cannot afford is to continue putting tens of billions of dollars into programs that waste resources by favoring low-value projects over high-value projects. A large-scale shift to users-pay/users-benefit, revenue bond financing, and devolving some federal responsibilities to state, metro-area, and private-sector parties will revitalize U.S. transportation infrastructure, allocating investment dollars where they will be most productive.

$52 Billion Plan to Reduce Traffic Congestion In Chicago

Posted on July 19, 2012, 10:00am

A new study finds Chicago has severely underinvested in expressways and urges the region to embark on an ambitious long-term road-building plan. The Reason Foundation's Galvin Mobility Project plan proposes 11 major transportation projects that would add 2,401 new lane miles of expressways in the region, reduce the time that Chicagoans spend stuck in traffic by 90 million hours a year and add $2 billion a year to the regional economy by 2040.   

“Expressways make up just 18 percent of the Chicago region’s road network and yet they handle over 53 percent of the vehicle miles traveled,” said Reason Foundation Vice President Adrian Moore, the study’s project director who served on Congress’ National Surface Transportation Infrastructure Financing Commission. “Between 1982 and 2010 travel demand increased 126 percent on expressways but the number of lane miles increased by just 57 percent.”

The plan’s 11 projects, which would cost $52 billion to build, could be financed entirely by toll revenues from the new lanes and roads, meaning drivers and businesses would get major infrastructure upgrades and new transportation choices without tax increases.  

“The people who use these roads and tunnels will pay the costs to build and maintain them – as it should be,” stated Reason Foundation Senior Fellow Samuel Staley, author of the report and managing director or the DeVoe L. Moore Center at Florida State University. “By using variably-priced tolls, Chicago can guarantee both free-flowing traffic conditions and a sustainable revenue stream that ensures the long-term health of the road network.  And many of these projects would be ideal candidates to be part of Mayor Rahm Emanuel’s Chicago Infrastructure Trust.”

The Reason Foundation transportation plan for Chicago includes: 

• Regional High-Occupancy Toll Lanes Network: A 275-mile (1,100 lane miles), $12.0 billion network of high-occupancy toll (HOT) lanes that would add two priced lanes in each direction on I-294 (Tri-State Tollway), I-90 (Northwest Tollway), I-88 (East-West Tollway), and I-355 South of I-88. The toll rates in these lanes would vary, based on traffic conditions, to ensure they remain free flowing at all times.
• Cross Town Tunnel: An 11-mile, $7.1 billion north-south tunnel in the alignment of Cicero Avenue and a nine-mile, $5.8 billion elevated Midway Extension running east along 63rd Street, connecting to the north endpoint of the Chicago Skyway (I-90). This project would allow through-traffic to bypass the downtown area and provide a connection between I-90/I-94, I-290 and I-55, alleviating problems around some of the most debilitating bottlenecks (the Circle and the I-90 Skyway Split). 
• Outer Beltway: A 76.3-mile, $5.0 billion new outer expressway through Cook, DuPage and Will Counties with three toll lanes in each direction. 
• Lake County Corridor: A 32.3-mile, $2.1 billion expressway extension connecting the proposed Outer Beltway with I-94.
• Northbrook-Palatine Connector: A new 25.3-mile, $1.6 billion freeway running between the I-94/I-294 interchange in Northbrook and the new Outer Beltway in Barrington.
• Elgin-O’Hare Extension: A 17.3-mile, $1.1 billion extension of the Elgin O’Hare Expressway east to O’Hare International Airport and west to the new Outer Beltway that is similar to a project in the Chicago Metropolitan Agency for Planning’s Regional Transportation Plan.
• Illiana Corridor: A 40.5-mile, $2.6 billion extension of the southern end of I-355, connecting Chicago with the state of Indiana.
• Arterial Queue Jumpers: A $3.5 billion initiative to build more than 50 queue jumpers, special overpasses and tunnels that allow cars and buses to bypass traffic signals at major arterial intersections.
• Bus Rapid Transit Network: A system of bus routes that would utilize the new toll lanes network to provide express bus service to key locations.
• Kennedy Tunnel: A 9.8-mile, $6.4 billion tunnel paralleling the Kennedy Expressway that would provide a fast alternative to I-90/I-94. 
• Eisenhower Tunnel: A 7.3-mile, $4.8 billion tunnel paralleling the Eisenhower Expressway (I-290) to alleviate one of the nation’s biggest bottlenecks on the Eisenhower between exits 13 and 17.

“Chicago’s population is going to continue to grow. And the current long-range plans acknowledge that traffic congestion will continue to worsen and take billions more out of the region’s economy,” Staley said. “The Reason Foundation plan will reduce congestion, shorten travel times and provide workers and businesses with options and flexibility that save time and money.”

Full Report Online

The full study is online here (.pdf). 

Reason Foundation’s transportation research is here. 

Washington's Road to Economic Decline

Posted on April 12, 2012, 4:55pm | Adrian Moore

I have a column up at Real Clear Markets today about the "long history of bi-partisan bonehead thinking on Capitol Hill about transportation, jobs and the economy."

It is no surprise that in an economic slump, or any other time really, politicians would focus on the jobs "created" by transportation spending. Leaving aside the flawed logic that taking money from one group of people to fund work by others in any real way "creates" jobs. The stopgap transportation bill is a poster child for how Washington has long been thinking about transportation, which explains the decisions it has made that have undermined economic growth in the United States.

I go on to explain how transportation infrastructure really effects the economy, with some emphasis on how disastrous is our federal, state and local government's decisions to allow congestion to continue growing. I conclude:

Our economy needs an oil change in the form of revamping transportation policy to focus on providing an effective transportation system that fuels economic growth rather than political ambitions and the creation of jobs "immediately," as Rep. Pelosi put it. Two years ago, a colleague and I sketched out in some detail what a more effective highway trust fund reform would look like. The most important things we focused on were transportation investments that maximize transportation benefits and mobility, and funding transportation with user fees, not taxes. Our economy depends too much on effective transportation for it to be a political pony to ride.

Read the whole thing here.

Yes, Traffic Congestion Does Hurt Cities

Posted on January 8, 2012, 8:00am | Samuel Staley

Once again, a chorus is coalescing around a small group of planners and so-called urbanists who are arguing that traffic congestion is good for cities (see prime examples here and here). So, in this month's commentary for Reason Foundation (Jan 5, 2012), I address this issue straight on. The slow cities advocates are

"missing a critical element -- the economic repercussions of slowing people down. The time spent stuck in traffic or on a slower commute or journey is time not spent shopping, eating at home with family, playing or working.

"Longer commutes limit the size, scope and depth of labor markets. Firms have less access to workers because workers generally don't look for jobs far from where they live. And it's well established among urban economists that workers will accept lower paying jobs in order to avoid too long of a commute.

"This isn't just theory. Real-world data supports the negative economic impacts of rising traffic congestion. A study by economist Kent Hymel appeared in the Journal of Urban Economics which linked traffic congestion to slower employment growth. Hymel examined traffic congestion and employment growth in 85 metropolitan areas between 1990 and 2003 and found evidence of rising regional traffic congestion choking employment growth. For example, a 50 percent reduction in congestion could boost employment by 10 to 30 percent in America's top 10 most congested cities. For Los Angeles, the most congested city in the U.S. in several measures according to the Texas Transportation Institute, a 10 percent increase in regional congestion reduced employment growth by 4 percent, according to Hymel's estimates. In short, Hymel writes, "congestion has a broad negative impact on economic growth."

I cite other studies in the commentary, including the policy report by David Hartgen that estimated the economic cost of congestion in several major cities. I've also summarized the research and the policy implications in my books, The Road More Traveled: Why the Congestion Crisis Matters More Than You Think, and What We Can Do About it and Mobility First: A New Vision for Transportation in a Globally Competitive 21st Century, both published by Rowman & Littlefield.

Congestion Coalition Regains Strength Despite Research

Posted on December 18, 2011, 6:08pm | Samuel Staley

A couple of recent news items have raised the profile of the congestion coalition-a subgroup of planners and Smart Growth advocates that believe slowing cities and the economy down would be beneficial. Will Doig, writing over at Salon.com (17 December 2011), notes for example, :

"But look around (if you have a second) and you might notice that a lot of the new ideas seeping into cities are aimed not at making them faster, but slowing them down. The buzziest mode of transport now is a bicycle. Streetcars, a pokey throwback, are returning. Walkable neighborhoods, traffic-calming measures and “slow zones” are catching on, and freeways are being torn down and replaced with lower-speed boulevards. Even things like sit-down pedestrian plazas and pop-up cafes seem to indicate a desire to slacken the pace.

"Slower cities have a lot to recommend them. “It’s not just a road safety issue,” says Rod King, the creator of “20′s Plenty for Us,” a movement to reduce London’s speed limit to 20 miles per hour. “There are a lot of peripheral advantages to slowing down traffic.” The advantages include increased biking because roads aren’t so scary, the need for less infrastructure like speed bumps, and better air quality (racing from one traffic light to the next burns more fuel). Add in the public-safety benefits of slower cars (which are hard to overstate — a few extra miles per hour can literally kill) and putting on the brakes starts to look like a no-brainer."

Noticebly absent from this article and the discussion more generally is the economic effects of slowing down. Economic theary suggests that "slowing the pace" will increase travel times. Higher travel times will increase travel costs. Increased travel costs will lower productivity (not to mention reduce the amount of time we spend with family, friends, and other recreational activities) and, ultimately, our standard of living. (Another effect is encouraging economic sprawl, but that's another discussion.)

And, these effects aren't just theoretical. There is an important academic literature that has linked higher travel costs and slower speeds to lower economic growth and productivity. Adrian Moore and I summarized this research and discussed its implications for transportation planning in Mobility First: A New Vision for Transportation in a Globally Competitive 21st Century. Ted Balaker and I summarized much of this literature and examined the national policy implications in our book The Road More Traveled: Why the Congestion Crisis Matters More Than You Think, and What We Can Do About It.

The classic modern empirical analysis was done by French economist Remy Prud'homme and Chang-Woon Lee (published in the journal Urban Studies in 1999). Kent Hymel has made an important recent contribution in the Journal of Urban Economics (vol. 65, no. 2, 2009) on congestion and employment growth. Reason Foundation has also published an extensive policy study, Gridlock and Growth (2009) by David Hartgen, on the practical effects of travel times and speed on metrpolitan productivity and income growth in several U.S. cities.

Slowing down cities may be good for some largely self-contained neighborhoods, but it's bad for cities generally, their urbanized regions and the national economy.

Traffic Congestion: Bigger and Badder Than Ever

Posted on September 27, 2011, 1:42pm | Samuel Staley

The Texas Transportation Institute at Texas A&M University released it's most recent annual report on the state of urban traffic congestion in the U.S., and the results are pretty clear: Congestion is coming back with a vengeance. The 2011 Urban Mobility Report notes that traffic congestion experienced a lull during the recession. But, as the economy begins to rejuvenate, congestion will come back and be worse than ever:

"The economic recession has only provided a temporary respite from the growing congestion problem. When the economic growth returns, the average commuter is estimated to see an additional 3 hours of delay by 2015 and 7 hours by 2020. By 2015, the cost of gridlock will rise from $101 billion to $133 billion – more than $900 for every commuter, and the amount of wasted fuel will jump from 1.9 billion gallons to 2.5 billion gallons – enough to fill more than 275,000 gasoline tanker trucks."

The reason is quite simple, even if missed by the mainstream media: The general public hasn't lost its appetite for mobility. The recession only curbed our ability to obtain mobility in the short term. In economic jargon, lower incomes may have reduced our willingness to consume mobility (drive more), but our utility curve (fundamental preferences) haven't changed at all. Once our income rebounds, we will once again take advantage of mobility afforded by the automobile.

Notably, the Texas Transportation Institute emphasizes again that the solutions include building roads on pace with rising demand, providing public transit, demand management (not demand reduction), and road network optimization are the keys to success.

Of course, Reason Foundation has been in the forefront of these discussions. For an analysis of the broader problem and issues, including how mobility is essential to contemporary economies, see David Hartgen's policy study Gridlock and Growth: the Impact of Traffic Congstion on Regional Economic Performance and our book Mobiltiy First: A New Vision for Transportation in a Globally Competitive 21st Century. Also, our more nuts & bolts book The Road More Traveled: Why the Congestion Crisis Matters More Than You Think, and What We Can Do About It is highly relevant (and includes a solutions check list).

Carmageddon and the Future of Cars

Posted on July 15, 2011, 11:23am | Samuel Staley

Beginning this weekend, I-405 over the Sepulveda Pass in Los Angeles will be closed for the weekend. Many of labeled this event "Carmaggedon" because the expectation is that LA will come to a standstill. Of course, we won't know until Monday whether this in fact happens, but the event has generated a lot of press, including a discussion at the New York Time's on-line forum Room for Debate (including a comment by me).

Today, KCRW radio will host a discussion on "To the Point" hosted by Warren Olney on the broader question of cars, transit and mobility. I will be a guest. The show starts, or at least my part in it, at 11 am PT/2 pm ET. I will be making the case for mobility and the inherent benefits of automobile travel.

Prioritizing Transportation Investments: A Note from Chongqing

Posted on June 2, 2011, 10:12am | Samuel Staley

I recently was listening to a report on transportation policy and implementation at Southwest University in Chongqing, China. Chongqing is a place many Americans haven't heard of (yet), but it's likely to become a principal growth driver for China, similar to the role Chicago played in propelling economic growth in the U.S. Not surprisingly, this city faces big transportation challenges.

The biggest issue facing Chongqing is the erosion of mobility. Higher travel costs (in time as well as money) reduce its competitive advantage as a low-cost provider of labor and other resources as well as its central location within this vast nation as a logistics center. The challenge of improving mobility is reaching critical points. With nearly 7 million people in the urbanized area (bigger than Houston, Texas), the city is expected to grow to 10 million people by 2020. And that estimate excludes the "floating" population--people without permanent residency status with the local government. The Yuzhong District, equivalent to the city's primary downtown, has over 700,000 permanent residents and a floating population of about 300,000. In population, that's bigger than Manhattan.

Anyway, back to the presentation at Southwest University. The researchers were summarizing the initiatives the Yuzhong District government has implemented to easing congestion and improving mobility. They're focused on all modes, particularly transit and rising automobile use. One of their biggest projects in a 3 km underground traffic circle that will link more than 6,000 parking spaces right under the Liberation Monument, an iconic tourist and high-end shopping location in the center of its CBD. They are also adding three bridges (two of which will connect to the traffic circle). In short, they are adding capacity at speeds that would bewilder most U.S. transportation planners and decisionmakers.

Chongqing is also heavily investing in rail transit, bus transit, pedestrian walkways and Intelligent Transportation Systems (ITS). ITS is a catch-all for all the technologies used to optimize the existing transportation network, and includes policies such as traffic signal synchronization, ramp metering, and electronic pricing of parking facilities and roads. In the West, we usually refer to ITS technologies as "demand management."

And there's the rub. ITS is being examined (and implemented) in Chongqing as a way to manage demand but not to the exclusion of increasing system capacity for all modes, particularly roads, to accomodate higher levels of travel demand and more efficient deployment of publc transit. In short, the Chinese are thinking of solving their transportation challenges by focusing on improving both supply and demand.

How is this different from the U.S. (and Europe for that matter)? Over here, ITS is a euphemism for automobile travel reduction. Managing demand is really about getting people out of their cars and into a usually less efficient and more time consuming mode of travel (often public transit). Because the Chinese have embraced improved mobility as a cornerstone of transportation policy, they are focused on optimizing their existing network while expanding the system to meet increased and changing demand at the same time.

This is a much healthier way to look at the problem and leaves Chongqing officials with a much broader array of tools for managing their growing traffic problem and making their public transit system more efficient.

For more on ITS, demand management, and capacity expansion, look at the book Adrian Moore and I wrote called Mobility First: A New Vision for Transportaton in a Globally Competitive 21st Century (Rowman & Littlefield).

New at Reason: The Year 2010 in Toll Roads, HOT Lanes, Infrastructure Finance

Posted on February 11, 2011, 7:51pm | Leonard Gilroy

The rollout of Reason Foundation's Annual Privatization Report 2010 continues today with the release of the Surface Transportation section—authored by Reason's Robert Poole—which provides a comprehensive overview of the latest on toll roads, HOT lanes and other news on privatization and public-private partnerships in surface transportation. Topics include:

• Transportation Infrastructure Finance 2010
• Long-Term Concessions, the Federal Perspective
• New PPP Toll Roads
• HOT/Managed Lanes and Networks
• Overseas Concession Highway Projects

» APR 2010: Surface Transportation [pdf, 1.1 MB]
» Complete Annual Privatization Report 2010

The Cost of Congestion: 130 Days of Flow Through Alaskan Pipeline

Posted on February 2, 2011, 8:45am | Samuel Staley

Last week, the Texas Transportation Institute released it's annual Urban Mobility Report. Its got lots of good information, and this one is more accurate and more sophisticated in its approach. In reading through the report thorougly, I thought these bullets (from page 5) helped put the congestion problem in context:

Congestion wastes a massive amount of time, fuel and money. In 2009:

·          3.9 billion gallons of wasted fuel (equivalent to 130 days of flow in the Alaska Pipeline).

·          4.8 billion hours of extra time (equivalent to the time Americans spend relaxing and thinking in 10 weeks).

·          $115 billion of delay and fuel cost (the negative effect of uncertain or longer delivery times, missed meetings, business relocations and other congestion-related effects are not included).

·          $33 billion of the delay cost was the effect of congestion on truck operations; this does not include any value for the goods being transported in the trucks.

·          The cost to the average commuter was $808 in 2009 compared to an inflation-adjusted $351 in 1982.

Is Compact Infrastructure Development Business Friendly?

Posted on August 16, 2010, 8:03am | Samuel Staley

One issue emerging in the debate over infrastructure investment is whether compact development--land development in higher density areas--will discourage business formation and job creation. The concern is that central cities are not business friendly and policies that restrict infrastructure development on the urban periphery will discourage business investment by forcing businesses to locate in less economically hospitable environments. The emphasis on directing infrastructure to existing areas and away from low-density suburban areas is a hallmark of climate change and Smart Growth legislation.

University of  California at Berkeley planners Karen Chapple and Carrie Makarewicz have examined this relationship using firm formation, expansion, and location data for California in the most recent (Spring 2010) issue of  Access magazine. Their conclusion is that most compact development does not discourage business formation or investment because most firms locate and expand in central cities anyway. They conclude:

There is little doubt that expanding firms prefer to be near transportation infrastructure, but the recent history of California shows that firms can expand and stay close to infrastructure without leaving dense, already-populated areas. The businesses that have contributed to the majority of growth within the last 15 years have not been expanding on the urban periphery in search of new, undeveloped sites with little infrastructure and no highway. Rather they seek sites with existing major infrastructure that has been in place long enough to attract other city amenities, an ample labor force, and appropriate housing for their workers. In short, businesses can’t expand without access to infrastructure, but businesses can get access to infrastructure without migrating to the periphery. Our analysis suggests that if anything, firms would like to see more (and more varied) housing options in areas that are already-developed. If this is the case, then by encouraging infill development SB 375 [California's climate change legislation] could very well help, not hinder, California’s economic growth.

The essence of Chapple and Makarewicz's argument is that while infrastructure investments, such as access to highways, are important to business location, other benefits to higher density locations such as housing stock and work force offset any negative effects. This makes sense as far as it goes, but it ignores how the performance of the transportation network effects business investment decisions, productivity, and job creation (something Adrian Moore and I discuss in chapters 2-3 of our book Mobility First.)

One of the benefits of expanding road networks, particularly through limited-access highways, in the latter half of the 20th century was the ability to improve the performance of the network, giving businesses greater access to locations and workers more access to employment. To the extent infrastructure investments are focused on the wrong projects, and reduce access through lower systemwide performance and greater travel times, policies that force transportation investments into higher higher cost and more difficult to serve areas could reduce economic competitiveness.

Chapple and Markarewicz's study focuses on the redistributive effects of business investment within an urban region (or metropolitan area). The effects of a poorly performing transportation network will be in a lack of regional competitiveness, not whether businesses locate from one city to another within a urbanized area. These regional competitive effects are explored in depth by David Hartgen and M. Gregory Fields in their study Gridlock and Growth a study for Reason Foundation in 2009. Given that the goals of most land use and transportation provisions of climate change legislation will have the effect of lengthening commutes and increasing traffic congestion, urban economic competitiveness is likely to suffer. The overall level of business activity will fall even if more businesses are located in the higher density regions.

So, when it comes to the analysis of infrastructure investment's impact on economic competitiveness, I think Chapple and Markarewicz are measuring the wrong thing. We need to focus on growing the overall economic pie at the urban level, not redistributing an increasingly shrinking pie. Thus, focusing investment in higher density areas without commensurate investments to maintain mobility and access will reduce economic competitiveness and the dynamism of the local economy.

HOT Lanes and Toll Tunnel Could Alleviate Congestion in Honolulu

Posted on May 21, 2010, 10:27am | Samuel Staley

Honolulu congestion ranks among the highest in the nation, with a travel time index higher than many metropolitan areas much larger. According to the Texas Transportation Institute, the Honolulu region's travel time index of 1.24 is the highest among medium-size cities it tracks from year to year and ranks 28th highest out of 90 overall.

Practical solutions exist to reducing congestion, however, and they are detailed in an excellent study by University of Hawai'i traffic engineer Panos Prevedouros. In a report titled "Transportation Alternatives Analysis for Mitigating Traffic Congestion" released in June 2008, Dr. Prevedouros provides a detailed analysis of core infrastructure projects that would dramatically improve travel times and create free-flow travel across the city, including:

• A 2-3 lane, reversible, High Occupancy Toll (HOT) lane that would reduce congestion (not slow the rate of increse) by 35 percent;
• A 2-lane reversible toll tunnel under Pearl Harbor that would cut travel time from Westeran Oahu (Ewa) to downtown from 65 minutes to 11 minutes;
• The toll tunnel would also reduce traffic on the main highway (H1), reducing commute times from 65 to 40 minutes;
• Four underpasses (queue jumpers) at critical intersections that would improve flow equivalent to a proposed 20 mile heavy rail system (at a small fraction of the cost).

Additional information on congestion mitigation can be found at Honolulutraffic.com.

Missouri's Road Director Wins Two Prestigious Awards

Posted on February 1, 2010, 11:44am | Shirley Ybarra

The Director of Transportation in Missouri  Pete Rahn has recently won two prestigious awards and rightly so. 

He won the Governing Magazine “public official of the year”and the Lester Lamm Award from the Road Gang at their annual lunch duting the Transportation Research Board meeting in Washington DC in January.  Pete deserves both awards for his forward thinking on how to do more with the money coming in to the highway department….in other words, how to get more bang for the bucks.

Pete has been changing the way Missouri does it roads business since the day he arrived from New Mexico Department of Transportation   (where he did the first road warranty project in US. I first met him then when I was Secretary in Virginia)

In his speech to the Road Gang (worth viewing see link below)  Pete"s focus is on thinking about the system rather than doing the “perfect project” which most highway departments find themselves doing….to great expense.   A good example he gives is replacing a bridge with a “project” that is over-designed and frankly a waste of money.   (Too wide, too many lanes, too long etc)   The  department re-thought the project and found a solution that delivered the same (or better) benefits without overbuilding the project and wasting money.

This forward thinking concept is called “practical design” and  he wants his folks to  think about the highway system performance   This concept does not always sit well with the designers and engineers since their inclination is to design and build the “perfect” project, which often is larger and often overdone.

This concept has not been to the detriment of the roads in Missouri.  Road conditions in the Show Me State have been steadily improving since 2004 when only 47 percent of highways were in good condition.  According to new figures released by the Missouri Department of Transportation (MoDOT) , 86 percent of the state's busiest roads are now in good condition.  Rahn admits that making such a transformative change can be "incredibly difficult" for a state DOT, but he said, "In today's tough economy, practical design is helping MoDOT to do more with less. We're building the right projects, on budget and on time, that are creating maximum benefits for the people of Missouri."

The video (with slides) of his speech to the Road Gang is here.  It is a thoughtful presentation that every state highway official should watch as well as those of us who  hold highway departments accountable.

We can get more "bang for the bucks" from both the the state transportation departments as well as the federal government if we all pay attention to innovative suggestions such as practical design

Accessibility Vs Mobility

Posted on January 24, 2010, 8:59am | Samuel Staley

My most recent post on Planetizen.com's blog Interchange takes up the question of whether mobilty and accessibiliy are the same thing. Planners have become enamoured with the idea that accessibility and mobility are independent of each other. Since mobility is usually considered auto-mobility, and therefore care dependent, they aren't so concerned about reducing mobility. The implication is that people are indifferent between living in places that are autodependent (low densities) versus transit-oriented (high density, mixed use) as long as services and other things are "accessible" via other modes.

I challenge this idea and make the case that mobility is a key to accessibility, and this is one reason why the popularity of the automobile persists. I point out:

"Unfortunately, by conflating mobility, accessibility and transportation modes, we leave out the crucial discussion of the trade offs implied by consciously shifting from one transportation mode to another. Simply adding transportation modes to an existing built environment will not necessarily increase mobility or accessibility. If the buses run empty, and bicycle paths go unused, the provision of these alternative modes provides neither greater mobility nor greater access. Indeed, by shifting resources from more productive public investments, including greater capacity for the modes that make sense, overall accessibility may decline."

The discussion threat, as always, is as informative and entertaining as the post itself!

The Neglected Importance of Arterials

Posted on January 20, 2010, 7:52am | Samuel Staley

Wendell Cox has a nice short piece on newgeography.com on the importance of a well functioning arterial network to keep traffic moving efficiently in cities. The specific focus of the article is Atlanta, but the principle is generally true. Notes Cox:

"In metropolitan areas with effective arterial street systems (such as Los Angeles), there is usually a surface alternative to a grid-locked freeway. A skilled driver can use these alternate routes and avoid much of the frustration of congestion. This may or may not improve travel times, but it is certainly better for the psyche. In Atlanta, there are few alternatives to the freeways and even the freeway system itself is very sparse."

Adrian and I discuss the importance of arterials in our book Mobility First, including a full chapter on what we call the "missing link" of high-capacity boulevards, queue jumpers, and other arterials.

Arterials have become an increasingly important component of Reason Foundation's Galvin Project to End Congestin as well. Las year, for example, we published a pathbreaking study on this was Reason Foundation's congestion case study of Lee County, Florida where Bob Poole and Chris Swenson develop a long-range plan for reducing congestion through arterials and the creative application of queue jumpers (another solution featured in Mobility First).

Congestion Climbs in 2009 Despite Recession

Posted on January 5, 2010, 1:55pm | Samuel Staley

Some folks think the economic recession and reduction in automobile travel might provide a respite from the seemingly relentless increase in congestion. This was certainly implied in the most recent mobility report from the Texas Transportation Institute (although they warned that this would be temporary).

So, bullet No. 7 in a press release speculating on the top 10 transportation issues for 2010 by the American Association of State Highway and Transportation Officials (AASHTO) caught my eye:

Responding to Increased Congestion Due to Capacity Issues
In 2008, high gas prices drove thousands of commuters from their cars and onto buses, subways and other transit options. As gas prices moderated, however, many of these riders went back to their vehicles. In fact, despite the economic downturn, 64 of the 100 most populated cities saw increased congestion in the first six months of 2009. This congestion will only continue to worsen as more people move to metropolitan areas and little is done to increase the capacity of the overall transportation system. In early 2010, AASHTO will issue a new report that outlines a four-point plan to address the urban mobility challenge. Other reports on the transportation needs of rural and underserved areas as well as freight will follow.

The economic, social, and political implications of rising congestion are discussed more completely in our book Mobility First: A New Vision for Transportation in a Globally Competitive 21st Century and The Road More Traveled: Why the Congestion Crisis Matters More Than You Think, and What We Can Do About It.

World Car Free Day Tomorrow---Buy Your Bread and Milk Now

Posted on September 21, 2009, 10:54am | Shirley Ybarra

An article in the Washington Post on Sunday notified me that Tuesday, September 22, 2009 is World Car Free Day.

“World Car Free Day is the annual apex of a global movement that promotes alternatives to a car-dependent society, including improvement of mass transit, cycling and walking, and the development of communities where jobs are closer to home and where shopping is within walking distance.” The global movement is based in the Czech Republic and coordinates the European activities.  Projects in the USA are run through a variety of member organizations because there were technical issues regarding the tax free status   Details are here.

A charter for the organization is here and obviously their agenda does not include mobility. 

While the loss of life attributed to automobile crashes is tragic--3,000 per day world wide according to this group—there are many who would disagree with their premise that “automobiles shape and distort our urban environment. They replace lively, pleasant, walkable, human-scaled communities with low-density, sprawled-out environments designed for getting elsewhere as fast as possible.”

The charter goes on to say, “Our society's dependence on an expensive, inequitable technology - the most resource-intensive means of locomotion ever devised - has expanded to achieve a radical monopoly in much of the industrialised world. This automobile-motorway-petroleum system denies free mobility to children, the elderly, the poor and the physically handicapped. Public transport, bicycle and pedestrian infrastructure is tacked on as an afterthought, if at all.”

This all seems a bid much doesn’t it?

The Washington DC area ranks in the top five in every survey of urban congestion, commuter stress and time wasted going bumper to bumper in traffic, the notion of a day without cars sounds as delightful as it does preposterous.
Last year, the DC region had 5,445 people participate and this year the organizers are hoping for 10,000 participants.  However, the counter shows they are quite a ways from reaching their target tomorrow.

A 24-hour break from burning carbon fuel might mean a peaceful hiatus from noise and a reduction in air pollution, but there's no guarantee that it will be a better air-quality day.  When the Washington DC region has a bad-air day, it's caused by an atmospheric inversion that stalls soot blown our way from the Midwest. This is well known.

Lon Anderson of AAA MidAtlantic has stated “There is a major misconception about how much vehicles contribute to pollution." Anderson said about 25 percent of the DC region's pollution comes from cars.  He goes on to say, "What comes out of the tailpipe is about 95 percent cleaner than it was 25 years ago. A lawn mower that runs for a couple of hours puts more pollution in the air than a car driving from here to New York and back."

So as we do in “snow days” we in the DC area had best buy our bread and milk today before the Car Free Day starts tomorrow since the delivery systems for anything on the grocery shelves will be completely disrupted tomorrow.  Not likely this year anyway.

My colleagues at Reason have written extensively about mobility and its contribution to the economy.  See any of the writings of Adrian Moore, Bob Poole, Sam Staley and David Hartgen. 

Daniel Burnham: Congestion is a Menace

Posted on September 8, 2009, 11:50am | Samuel Staley

This year is the centennial of the publication of the Plan of Chicago, a watershed initiative that was instrumental to the creation of modern urban planning in the United States. Chicago has been immersed in a year-long celebration of its publication and the decades long effort to implement the recommendations of its principal author: Daniel Burnham.

I wonder how many contemporary planners have really read the Plan of Chicago. If they did, the probably would be surprised by the following quote from page 100: "Congestion is a menace to the commercial progress of the city." They would also be surprised that four of the six major recommendations involved building new transportation infrastructure and three of those points were focused on expanding road capacity.

The Plan called for:

• Major new regional roads in concentric rings around the center city, reaching as far as southern Wisconsin and northwestern Indiana;
• Improvement of the "lake front," including the construction of what is now Lakeshore Drive, a major high-volume arterial linking northern and southern reaches of the region to downtown;
• Major expansions of city streets and arterials, including multi-decking roads (e.g., Wacker Drive) and widening major avenues (e.g., Michigan Avenue).
• Building and improving railway terminals to more efficiently ship freight to bypass the center city and improve the convenience of passenger travel into the central city.

The other major recommendations were for a system of regional partks and the construction of major new civic buildings and "centers of intellectual life."

While the modern professional planning community tends to focus on the civic centers and parks outlined in the plan, one could argue the central question was how to improve mobility to foster the city's continued development into a global mega city.

Smart Growth, Traffic Congestion Reduce Growth

Posted on September 3, 2009, 2:25am | Samuel Staley

One of the more persistent myths in the urban planning profession is that traffic congestion is either economically benign or may be a symbol of urban vibrancy. Adrian Moore and I debunk much of this in our book Mobility First (see chapter 3), but it now looks like the news media is beginning to take note based on the results from Reason Foundation's new study Gridlock and Growth by transportation analysts David Hartgen and Gregg Fields.  

Specifically, the Examiner newspapers are running a nationwide editorial discussing the link between traffic congestion and economic growth. They are also pointing out the negative economic implications of so-called Smart Growth policies that either ignore these effects or dismiss their importance.

Their [Hartgen and Fields] results point to the significant economic upsurge that would result from eliminating traffic congestion. In San Francisco, for example, the study found that eliminating congestion around five key areas would generate $10 billion in new economic activity and add $750 million in tax revenue to local coffers. The figures for Denver are even more impressive, with $38 billion in economic growth and more than $2 billion in new revenue for local authorities. The average boost in economic growth for all eight cities studied was nearly $16 billion by 2030. The average tax-revenue increase was $900 million.

Hartgen and Fields’ bottom line is that reducing congestion and increasing travel speeds enough to improve access by 10 percent to key employment, retail, education and population centers increases regional production of goods and services by 1 percent. If that seems like too little return for the effort, the figures for increased economic growth and tax revenue would be quite tangible to those filling the new jobs, along with to the beneficiaries of enhanced government services made possible by added tax revenue. The alternative is to continue the losing “smart growth” regulatory game of increasing traffic congestion that suffocates economic expansion in the name of mass transit systems that the vast majority of people can’t or won’t use.

The full study and a more accessible policy summary can be found on Reason Foundation's web site.

Mobility Goes to the Back of the Bus

Posted on July 29, 2009, 11:41am | Samuel Staley

On Tuesday, the Urban Land Institute (ULI) released a major report on transportation policy and ways to reduce carbon dioxide emissions titled "Moving Cooler: An Analysis of Transportation Strategies for Reducing Greenhouse Gas Emissions." Given that most current transportation technologies rely on burning oil, a fossil fuel, to move people, goods and services from Point A to Point B, the most effective formulaic way to reduce carbon emissions is simply to stop moving. Not surprisingly, that's a big part of the ULI report.

The "strategies" that do the most to reduce green house gas emissions are those that dramatically increase the cost of driving a personal vehicle (car) and get us out of our cars and onto transit. In short, reduce vehicle miles traveled (VMT) and get people onto buses and trains, even if they still have to travel further and see vast more amounts of time consumed in everyday travel.

The report is not without its critics. Alan Pisarksi writes today at New Geography, this reports leaves out a lot.

"Maybe the saddest part of it all, the authors appear not to take global warming or energy security very seriously at all. Rather these public concerns are just a convenient hook, the cause du jour, on which to hang their favorite solutions. If global warming matters – and it does; if energy security matters – and it does; then early action is clearly called for, particularly given the cumulative nature of GHG gases. But somehow the things easily done and carrying with them little in the way of disruption or public costs – carpooling, telecommuting, dispersed work – are largely written off. Such immediate, low-cost actions as highway operations strategies including better traffic signalization, improved traveler information and accident response systems receive little emphasis.

"Overall, the treatment of costs and benefits will leave readers gasping:

"At the same time the benefits and the costs involved are so corrupted to be meaningless. It will take weeks for analysts to tease out what really was done in the way of assumptions to create winners and losers. And there is no effort to tally all the costs exacted on the average household, or the typical business or even governments for that matter. The costs would add up to a permanent recession."

Unfortunately, this report will likely be widely embraced in the current Administration, which has decided that mobility is a social cost, not a social benefit. The Administration has made a big deal of subverting transportation policy to environmental policy (and increasingly) housing policy objectives.

While reducing greenhouse gas emissions should be considered a legitimate policy goal, these goals need to be balanced with the tremendous social costs and upheavel that would result from the aggressive implementation of the transit, land use, and car reduction strategies outlines in this report.

Mobility First Called "Compelling" in New Review

Posted on July 27, 2009, 10:34am | Samuel Staley

We were pleased to see this review of our book Mobilty First: A New Vision for Transportation in a Globally Competitive 21st Century on The Forgotten Man blog. The review says Mobility First is "an important book" that "should be read by everyone." More specifically,

"Sam Staley and Adrian Moore in their important new book Mobility First show how congestion is only getting worse and threatens our economic vitality.  The research is detailed and their analysis is compelling.  They recommend some basic economic approaches such as matching supply with demand and engineering solutions such as improving ‘the flow in the pipe, not the size of the pipe’  They point out examples of technological improvements that are already in use in various parts of the world."

The Forgotten Man blog is focused on issues centered on the "forgotten man" memorialized in an essay by William Graham Sumner in 1883. Perhaps the most famous passage from the essay is the following (emphasis added by me):

"There is an almost invincible prejudice that a man who gives a dollar to a beggar is generous and kind-hearted, but that a man who refuses the beggar and puts the dollar in a savings bank is stingy and mean. The former is putting capital where it is very sure to be wasted, and where it will be a kind of seed for a long succession of future dollars, which must be wasted to ward off a greater strain on the sympathies than would have been occasioned by a refusal in the first place. Inasmuch as the dollar might have been turned into capital and given to a laborer who, while earning it, would have reproduced it, it must be regarded as taken from the latter. When a millionaire gives a dollar to a beggar the gain of utility to the beggar is enormous, and the loss of utility to the millionaire is insignificant. Generally the discussion is allowed to rest there. But if the millionaire makes capital of the dollar, it must go upon the labor market, as a demand for productive services. Hence there is another party in interest - the person who supplies productive services. There always are two parties. The second one is always the Forgotten Man, and any one who wants to truly understand the matter in question must go and search for the Forgotten Man. He will be found to be worthy, industrious, independent, and self-supporting. He is not, technically, "poor" or "weak"; he minds his own business, and makes no complaint. Consequently the philanthropists never think of him, and trample on him."

The idea behind the Forgotten Man was recently revitalized through a excellent popular book on the Great Depression of the same name by Amity Shlaes.

Is the Goal to Reduce Emissions, Fuel Use or Mobility?

Posted on June 15, 2009, 5:05pm | Robert Poole

One of the most troubling ideas gaining a head of steam as we approach reauthorization is that a key transportation performance measure should be reducing vehicle miles traveled —either in total or per capita. The logic behind this idea is that using petroleum fuel is bad, and emitting CO2 is bad, so transportation funding and programs should deliberately aim to reduce vehicle miles traveled (VMT), in order to advance those other goals.

This idea has been percolating at the Brookings Institution and among any number of environmental groups, and it’s also being heavily promoted by the America 2050 project. But what really caused alarm among transportation people was the release last month by Sens. Jay Rockefeller (D-WV) and Frank Lautenberg (D-NJ) of their Federal Surface Transportation Policy and Planning Act of 2009 (S.1036). The first of its major goals for federal transportation policy is “Reduce national per capita vehicle miles traveled on an annual basis.” It also calls for government-set targets for shifting freight from road to rail.

Putting these idea into legislative language has started to arouse transportation interest groups, as well it should. First out of the box was the American Highway Users Alliance, which sent a strong letter of opposition to every member of the Commerce Committt, including Chairman Rockefeller. I’m expecting all sorts of transportation related groups - AAA, ATA, ARTBA, AASHTO, and others - to join in the opposition, once they realize the implications of this proposal.

I’ve written about VMT restrictions at greater length in my May column for Public Works Financing.

Suffice it to say that if the goal is to reduce CO2 or petroleum use, Congress should target those things directly. The idea that reducing Americans’ mobility is a sensible or cost-effective way to reduce greenhouse gases has no empirical support. Indeed, I challenge any proponent of the idea to come up with evidence that it would cost less than the $50/ton of CO2 removed ceiling as a benchmark for “affordable” greenhouse gas reduction measures. (My guess is that it would cost thousands of dollars per ton.)

Mobility is the purpose of transportation. Its benefits, both for individual well-being and the health of the economy, are enormous.

As we head into reauthorization, our watchword should be: “Reduce CO2, not mobility.”

Transit Funding Could Come from the General Fund, Not the Highway Trust Fund

Posted on June 12, 2009, 8:01am | Robert Poole

It’s been widely reported that, just like last year, the Federal Highway Trust Fund is going to run out of money before the end of the federal fiscal year. The fix being talked about, like last year, is an emergency infusion from the general fund, thereby adding another $5-7 billion to the federal budget deficit.

The cause of this shortfall is no great mystery. If you’ll recall the last reauthorization debate, the transportation committees in Congress (especially in the House) were determined to greatly increase the size of the program, but the White House had promised to veto any fuel tax increases. So Congress compromised, pushing the promised funding level as high as they possibly could, by making “rosy scenario” assumptions about fuel prices, driving, and the state of the economy. Whoops! Last year’s high oil prices caused people to cut back on driving, meaning fewer gallons were sold than had been projected, and the subsequent recession caused people to economize on driving for a different reason. Both factors translated into lower fuel tax receipts. Meanwhile, the backlog of highway maintenance and repair, let alone long-needed expansions, continues to increase. And the Obama administration has “taken a gas tax increase off the table.”

Meanwhile, transit systems nationwide are making a big push for increased funding, based partly on last year’s ridership increases (which the recession seems to be reversing) and decades of deferred maintenance. With no fuel tax increase in sight, and both highway and transit groups proposing increased funding, how can this circle be squared?

My friend and colleague Alan Pisarski last week proposed what I think is a very promising—if radical—idea. “If we are going to need an infusion from the general fund, and we also need more total funding, why not ‘resolve’ the question of share by avoiding the question? Transfer the transit program 100 percent to the general fund and use all the Highway Trust Fund for highways. It might be a win-win.”

A few years ago this idea might have been dismissed out of hand, primarily because it would have been considered too risky for the transit community. After all, it took until 1964 to get even general fund money for transit, and it was considered a great breakthrough for transit when a transit account was created as part of the Highway Trust Fund (HTF) in 1982. That permitted highway user-tax money, for the first time, to be spent on transit. Because funding highways was popular, any expansion of the HTF would mean an increase for transit, too. And back then, highways were considered far more popular than transit.

That was then, this is now. In the age of energy insecurity and fear of global warming, transit is the cause du jour for many elected officials. It’s quite possible that transit would fare better if it did not have to fight with highway interests for its portion of Highway Trust Fund funding. A Congress eager to showcase its green credentials might want to reposition transit as an energy/environment/housing program, funded (like those programs) out of general revenues. Currently transit gets about 20 percent of Highway Trust Fund dollars, or around $8 billion. Shifting that amount to highways would more than cover the current shortfall. Yet replacing that $8 billion for transit would be a rounding error in the federal general fund.

Making this change would restore the original user-pays/user-benefits principle to the Highway Trust Fund. And if highway users could be assured that all of their fuel-tax dollars would actually be spent to maintain and improve the highway system, they just might be more comfortable with increasing the fuel tax rate. And by restoring the integrity of the highway fund, this change could help pave the way for eventual transition to a highway vehicle mileage tax (VMT) fee as the gas tax’s replacement.

Learning From Abroad: Public-Private Partnerships Building Highways Overseas

Posted on June 12, 2009, 7:00am | Robert Poole

Some of the recent U.S. debates about public-private partnerships for highways sound as if the idea is brand new, untried, and hence inherently risky. Yet long-term concession agreements under which the private sector can design, finance, build, operate, and maintain major highways, bridges, and tunnels date back to the 1960s in Europe and the 1990s in Australia.

We can learn a tremendous amount from the experiences of our counterparts overseas. At the Transportation Research Board annual meeting in January, I attended a presentation on a study tour on the overseas public-private partnership (PPP) experience, organized by AASHTO and the FHWA as part of the National Cooperative Highway Research Program. The report on this study tour, “Public-Private Partnerships for Highway Infrastructure: Capitalizing on International Experience,” was published in March 2009 (FHWA-PL-09-010).

The group, representing FHWA and four state DOTs, visited Australia, Portugal, Spain, and the United Kingdom in the summer of 2008. These countries have been doing PPPs long enough that the team was able to learn about second-generation and even a few third-generation projects. Their general findings include the following:

• Highway PPPs are used not simply for financial reasons but are selected on a value-for-money feasibility analysis basis.
• PPPs are a critically important and growing percentage of national highway networks.
• Highway PPPs do not necessarily require tolls; some are based on shadow tolls and/or availability payments.
• The public sector mindset and skills for PPPs differ substantially from those needed for conventional project delivery.
• A successful long-term PPP agreement must balance technical, commercial, and legal considerations.
• Public agencies recognize that a PPP arrangement is, in fact, a long-term partnership with the private sector founded on a contract.

The descriptions alone of how these four countries have adapted general PPP principles to their circumstances are worth the price of admission. But the report goes on to report numerous useful findings about methodology in selecting, negotiating, and managing long-term PPP arrangements.

I should add, because this point is much-argued about in the United States, that the report’s statement that the longest concession term they observed was 50 years, with most running 30 to 40 years, is true of the countries they visited. France, which they did not visit, has a number of bridge and tunnel mega-projects with terms of 70 or more years.