- Expanded TIFIA pros and cons
- Milking cash-cow toll roads
- Oregon’s new approach to mileage charging
- Trucks and alternative fuels
- MAP-21’s dubious “pay-fors”
- From suburbs to downtowns?
- California HSR funding fantasies
- Upcoming Conferences
- News Notes
- Quotable Quotes
Expanded TIFIA Draws Praise and Concerns
With great fanfare, DOT Secretary Ray LaHood on July 27th released the agency’s Notice of Funding Availability (NOFA) for the TIFIA program, as greatly expanded by the MAP-21 reauthorization bill. Comparing the new TIFIA to the original Interstate highway system, he praised it as “the largest infrastructure loan program in the nation’s history,” and encouraged states and metro areas nationwide to submit letters of interest.
MAP-21 expands TIFIA’s funding from $122 million per year to $750 million per year in FY 2013 and $1 billion in FY 2014. It also eliminates most of the discretionary selection criteria DOT had been using, and permits applicants to apply at any time throughout the year. Projects must still receive investment-grade ratings from two rating agencies, to weed out poorly justified projects. Since OMB scores a TIFIA loan at about 10% of its face value, and TIFIA loans cover only a portion of a project’s cost, the leverage is very significant. If the average TIFIA loan covers 33% of a project’s budget, the expanded TIFIA can now support $50 billion worth of projects over the next two years.
The July-August issue of Public Works Financing lists 12 major projects already in TIFIA’s backlog, with loan requests totaling $2.32 billion for highway and bridge projects (mostly managed lanes) and $1.39 billion for rail and other projects. In addition, the newsletter’s Major Projects Database includes “at least $17 billion worth of mature projects that will be submitted soon,” and another $35 billion worth of projects that state DOTs plan to procure as PPPs by 2014. Most of these will likely apply for TIFIA loans, so there’s a decent likelihood that a full $50 billion worth of projects could be financed.
However, concerns are being voiced by some of those who worked hard in support of expanding TIFIA. The general thrust of these concerns is that DOT’s NOFA is, in some respects, not consistent with the legislative intent of changing the selection process from one that is highly discretionary to one that basically provides a series of boxes to check off, so that if a project meets all the statutory criteria, it “shall receive credit assistance,” provided that funds are available. The lack of transparency in TIFIA’s previous selection process was highlighted in a recent GAO report on the program (GAO-12-641).
The NOFA expresses DOT’s intent to judge whether a project has sufficient “public benefits” to find that it is “in the public interest to provide credit assistance.” Additional factors being cited as suggesting DOT’s attempt to go beyond congressional intent include the following:
- A requirement to provide an indicative credit rating before submitting an application, despite no such statutory requirement;
- A requirement for legal and financial due diligence by the applicant and a $100,000 non-refundable fee, prior to submitting a formal application;
- A presumption that nobody can submit an application unless DOT “invites” one;
- DOT’s intent to limit credit assistance to 33% in the absence of the applicant providing a strong rationale for going as high as the maximum 49%.
One legal expert who was heavily involved in proposing legislative language for the expanded TIFIA writes that “This is exactly the type of opaque, policy-driven discretionary role of the Administration that Congress intended to eliminate from the program.”
I am sympathetic to the thrust of these concerns that DOT is imposing its preferences instead of implementing the law as written. But on the last bullet point above, I disagree. All the way through the reauthorization debates I argued for retaining the 33% maximum, for three reasons. First, it preserves the original intent of TIFIA as providing gap financing rather than becoming potentially the largest single source of a project’s budget. Second, the lower amount will serve to weed out weaker projects in favor of more-robust ones, thereby reducing the risk of default to taxpayers. And third, in this era of very limited federal resources, the available TIFIA funding will go a lot farther with the 33% limit; as noted above, it can support up to $50 billion worth of projects at 33% compared with only $34 billion at 49%.
TIFIA marks a major turning point for federal infrastructure investment, away from nearly total reliance on grants and toward a much larger role for loans, based on a required investment-grade project rating. That should serve to increase the productivity of these federal investments, guarding against more bridges to nowhere.
That is the title of a disturbing report issued by Moody’s Investor Service in February 2012. Analysts Maria Matesanz and Jim Hempstead do some number-crunching on the implications of a trend for state or municipal governments to transfer toll revenues from toll agencies to use for other governmental purposes-i.e., to convert a portion of the toll their customer pays from a user fee into a tax. They find that toll roads subject to such “external transfers” have weaker financials than those not so burdened. And they correctly worry that the burdened toll facilities will have to “raise their rates more frequently, and at higher percentages, which likely will attract political scrutiny and resistance to toll increases.”
For their analysis, the authors selected four toll agencies subjected to mandatory transfers: Triborough Bridge & Tunnel Authority, New Jersey Turnpike Authority, Pennsylvania Turnpike, and Harris County [Houston] Toll Road Authority. Their comparison group consisted of the Florida Turnpike, Orlando Orange County Expressway Authority, Oklahoma Turnpike, Ohio Turnpike, and Kansas Turnpike.
The burdens imposed on the unlucky four are a lot higher than many people realize. TBTA in recent years has had to divert nearly one-third of toll revenues to its parent agency, the New York MTA, while the New Jersey Turnpike now diverts around 20% of its toll revenues. HCTRA is in the 23-28% range, but worst of all is the Pennsylvania Turnpike, which in 2009 and 2010 transferred 134% and 127% of its toll revenue to the state under Act 44. Because such transfers must continue, by law, through 2057, the Turnpike has imposed dramatic toll rate increases, under which it will transfer “only” about 50% of its revenue to the state in coming years.
Comparing the financial health of “milked” and non-milked toll agencies, the authors find much lower debt service coverage ratios for the burdened ones, dramatically higher debt per toll transaction, and a far smaller cash cushion. In 2010, for example, the average milked toll agency had 347 days worth of cash on hand, while the non-milked ones averaged 898 days. This difference in financial robustness will lead to lower bond ratings, which will mean higher interest rates, leading to more toll rate increases “and accelerating a negative credit spiral.”
This is bad news not only for the burdened toll agencies but for the future of tolling (and mileage-based user fees) in America. Already, the populist right is trying to popularize the term “toll tax,” deliberately trying to destroy the generally correct perception that a toll is a user fee (like a phone bill or electric bill), not a tax. Governments that seek to milk their toll agencies convert part of the toll into a tax, thereby undercutting one of the toll sector’s primary advantages in the court of public opinion. So this is a trend that should, at a minimum, be contained to the existing milked agencies.
The Moody’s report notes almost in passing that such external transfers of toll revenues can be done “only if the toll road bond indenture provisions allow for cash to flow out.” And that suggests a way of reversing the damage over time, even at the burdened toll agencies. For all new bond issues, bond buyers should insist that the toll revenues servicing those bonds be used solely to benefit the toll road’s customers.
Oregon Rethinks How to Do Mileage-Based User Fees
Mention to a journalist charges based on vehicle miles of travel (VMT) or the more recent term, mileage-based user fees (MBUFs), and the immediate assumption is “a government-mandated GPS box in every vehicle, tracking everywhere you go.” That unfortunate image comes from some early proponents of the idea of charging per mile driven rather than by gallons of fuel consumed. They grandiosely conceived of a VMT charge as a do-everything mechanism: not only to replace declining fuel taxes as the principal funding source for roads but also to charge for congestion and to tax emissions and other negative externalities of motor vehicles and highways. The one-size-fits-all answer was a GPS box in every vehicle.
Oregon DOT was one of the first agencies to test a GPS box approach, back in 2007. Several hundred volunteer drivers had their cars temporarily outfitted with such a device, which uploaded their mileage at specially equipped gas pumps. While the system worked for recording and charging for miles driven-and did not “track” exactly where and when people drove-the fact that GPS was part of it fanned the flames of Big Brother surveillance fears.
But Oregon DOT has learned its lesson. It is kicking off a new pilot test this fall, based on a new vision. First, the system needs to be simple and offer motorists a choice of methods. Second, the system must be cost-effective, auditable, and protective of personal information. Third, it should build on what already exists in the marketplace. And fourth, the state’s role should be limited to things like setting standards, certifying approved private-sector applications, and deciding the level and structure of charges.
A detailed look at what ODOT is doing now is the article “Miles Ahead” in the April/May 2012 issue of Traffic Technology International, in which editor Nick Bradley interviews Jim Whitty of ODOT. The agency received numerous responses to its request for ideas from the private sector, and will use a number of those ideas in its modest new pilot program this fall. Instead of recruiting citizen volunteers, Whitty has taken the bold step of inviting “VIPs”-Oregon transportation commissioners, legislators sitting on transportation committees, etc.–to get them familiar with the new approaches and get their honest feedback.
There will be four basic alternatives in the new pilot test. The basic onboard unit will be a “dongle” that plugs into the vehicle’s diagnostic port and records only total miles driven. A second alternative will make use of existing systems such as Onstar that owners already have in their vehicles, which can report locations as well as miles. A third alternative will couple the dongle with a Bluetooth connection to a smart phone or tablet; this will enable users to distinguish between miles driven in-state (which will be charged for) and those driven out-of-state. The fourth category is aftermarket devices such as navigation units that can also report miles by location, if people choose to use them for that purpose.
And for those not wanting any MBUF technology in their vehicle, ODOT is planning a system by which people can buy miles in, say, 5,000 or 10,000-mile increments. “Over time, people will gravitate toward the easiest method [for them],” Whitty told editor Bradley. “Those who might be anti-technology now may move later to technologies such as a dongle for PAYD [pay as you drive], a smartphone, or a satnav system. [Or] they may decide to opt for a payment solution that allows them to drive and forget about the whole process operating in the background. We have to let that evolution happen.”
Whitty and his ODOT colleagues hope the trials will lead to legislation to put in place an initial MBUF system for electric cars and hybrids, so that green vehicles can pay their fair share of highway costs. As federal fuel economy mandates and fleet turnover lead to a doubling of average MPG over the next two decades, the need to charge the rest of the vehicle fleet per mile rather than per gallon will become more acute, generating political support for much broader use of MBUFs and the probable phase-out of fuel taxes. I think Oregon DOT has some good ideas, and I’ll be following their new trial with great interest.
There are two problems with using natural gas or electricity to replace diesel power in trucks: cost and range. But niche markets are being established for certain kinds of trucks using both of those alternatives, with much larger prospects for natural gas than for electricity at this point.
One basic problem is energy density. There is far more energy, measured in BTUs per cubic foot, in petroleum fuels than in either liquefied (LNG) or compressed (CNG) natural gas, and especially what can be stored in state-of-the-art batteries. That means much larger fuel tanks for LNG or CNG than for diesel, but that problem is most acute for small vehicles such as pick-up trucks, less so for larger vehicles such as buses, package delivery trucks, drayage trucks, garbage trucks, etc. where space is not at such a premium. That’s why we are seeing some fleets of delivery trucks, buses, and other local-service vehicles starting to use LNG, CNG, or propane (a derivative of natural gas).
The lack of fueling infrastructure is a second constraint on range, and another reason why local-service fleets that can refuel at central depots are an obvious initial market. But that, too, is starting to change, in parallel with efforts by truck and engine manufacturers to develop natural gas trucks for long-haul transportation. California-based Clean Energy Fuels Corp. plans to build 70 LNG stations at Flying J and Pilot truck stops over the next year. Shell plans 100 such stations at TravelCenters of America truck stops, starting next year. And Chesapeake Energy is working with General Electric to install its CNG “Station in a Box” at retail service stations.
Many questions remain about the full cost of LNG or CNG trucking, once the infrastructure costs are included in fuel prices, and the increased cost of a truck capable of operating on such fuel is factored in. Companies will only shift from diesel to natural gas if they get a reasonable return on the investment required. And I think the jury is still out on that question. Alas, some transportation operators in the public sector don’t seem constrained by such matters. A recent article in the Wall Street Journal (June 25th) discussed various ferry systems that are considering retrofitting from diesel to natural gas. The British Columbia system, according to the article, estimates it could save $28 million per year on fuel costs by switching, at a cost of between $10 million and $30 million for each of its 38 vessels. Using the midpoint of that range, $20 million apiece, the conversion cost would be $760 million. Using a modest 5% discount rate, the 50-year fuel savings would not pay for the conversion costs. You have to go all the way down to a 2% discount rate to get a break-even period of less than 40 years, and at 1% it would still take more than 30 years to break even. Yet the article reports that BC Ferries plans to convert “some boats” starting in 2014 or 2015. I’m sure it will be taxpayers, not ferry riders, who get stuck with the bill for this.
Congress’s Way of “Paying for” MAP-21
As I noted last month, there was a large gap between projected federal highway user tax revenues and desired highway and transit spending levels as Congress finalized the MAP-21 reauthorization bill in June. Having rejected House Transportation & Infrastructure Committee Chair John Mica’s honest proposal last fall to constrain the program size to the projected revenue level, Congress concocted a 10-year “pay-for” (for a two-year spending bill, mind you) as follows.
Press reports that summarized what they did as “tweaking” corporate pension rules disguise the enormity of the problem thereby created. First, they reduced the amount that companies with pension plans must contribute during the next 10 years. Since pension contributions are deductible from corporate income, that means those companies will have smaller deductions for 10 years and will therefore pay an estimated $9.4 billion more in federal taxes during that period. The “tweak” that accomplishes this is to let companies use an average interest rate (for calculating their pension liability) based on the past 25 years, rather than the previous rule of the past two years. The latter was part of a much-needed reform in 2006, enacted because companies were putting aside far too little, increasing the likelihood that more pension plans would have to be bailed out by the Pension Benefit Guarantee Corporation. So Congress tacked on an increase in the premiums companies must pay to support PBGC (which is chronically under-funded). Amazingly, the revenue from that premium increase is scored by the Congressional Budget Office as general revenue for budgeting purposes, so the projected $9.5 billion from that source could also be used to offset the Highway Trust Fund shortfall.
Actuaries have been outraged by these irresponsible actions. Donald Fuerst of the American Academy of Actuaries sent a letter to Congress in May, as members were debating these measures, explaining their likely devastating effects on the soundness of pension funds and urging Congress not to enact them. But to no avail.
I realize that this article is not, per se, about transportation. But I hope this episode illustrates to you the bankruptcy of the current federal transportation funding system. Unless Congress figures out a way to make the program self-supporting next time around (just two years hence), we can look forward to even more shenanigans of this sort. That is no way to create a long-term, sustainable source of highway funding.
More Games with Population Numbers
Math illiteracy (also known as innumeracy) was evident once again in media coverage of Census Bureau data released late in June about urban area population changes. The headline news was that historic urban core areas grew at a faster rate than their suburbs between July 2010 and July 2011. Just to pick a few examples at random, Atlanta’s urban core grew by 2.4%, while its suburbs grew by only 1.3%; Denver’s core up 2.7%, suburbs up 1.5%; Seattle’s core up 1.7% versus its suburbs up 1.5%. So most media portrayed this as yet another story about people deserting the suburbs for a return to urban living.
Figured out the mistake yet? It’s numbers versus rates. The suburbs began with a much larger population base than the urban cores, so they would have to grow by huge numbers to have a rate of growth equal to or better than their much smaller urban cores. Let’s go back to the three examples in the previous paragraph. The number of people added to Atlanta’s urban core was 10,040, but the number added to its suburbs was 62,869-six times higher. Denver added 16,528 to its historic core but 28,407 to its suburbs. And Seattle grew by 10,298 in its core but by 41,842 in its suburbs. Overall, among all 51 metro areas, urban cores added 462,579 people while their suburbs added 1,150,368.
We need to base transportation policies, and all other policies, on what is actually going on, not what some people wish were going on. It’s nice to see that most urban cores did not lose population during the past year, but the reality is that the suburbs kept growing, too. (For more details see: www.newgeography.com/content/002935-core-cities-growing-available-data-indicates-domestic-migration-losses.)
California High-Speed Rail Funding Fantasy Continues
I can’t resist sharing with you the results of an analysis in the July 25th issue of Transportation Weekly, a newsletter I highly recommend. After reporting on Gov. Jerry Brown’s signing of a bill to issue the initial $4.7 billion in high-speed rail bonds, to match $3.3 billion in already-awarded federal funding for the initial Central Valley section of the state’s HSR project, editor Jeff Davis goes on to consider the HSR Authority’s funding plan for the rest of the $68 billion project.
The latest business plan assumes, realistically, that Congress will provide no federal money in either FY 2013 or 2014, since none is provided for in the MAP-21 legislation that is now law. But between FY 2015 and FY 2025 it assumes an average of $3.1 billion in federal money in each and every one of those years. How realistic is that?
Davis first looks at the federal New Starts transit capital funding record over the past 17 years. Each year, one state ended up with the largest share (mostly New York, but sometimes California). That high share was as much as 34% (NY in FY96) and as low as 14% (CA in FY02). Congress would not consistently, year after year, award the lion’s share of any future HSR grant program to a single state such as California; even with a heavily Democratic House delegation, those members constitute only 8% of all House members. So how large would a hypothetical future HSR grant program have to be to ensure that California got an average of $3 billion a year for 11 years in a row?
Davis runs the numbers, with a table presenting the results. If California consistently got one-third of the money, the program would cost $103 billion over that period, averaging $9.4 billion per year. At a more realistic 20% share, the program would have to be $172 billion over 11 years, averaging $15.6 billion per year. And at a pessimistic (for California) one-sixth of the total, the program would have to be $206.6 billion over 11 years, averaging $18.8 billion per year.
Because the Budget Control Act of 2011 established annual caps on discretionary spending through 2021, a new discretionary program for HSR would have to be paid for by corresponding cuts in other discretionary programs. Hence, Davis’s conclusion: “There is no way on earth that Congress will provide $3 billion per year for a California-only high-speed rail program.” (italics in original) And I see no way on earth that it will create a new HSR grant program of a size large enough to give California anything like that sum, either. Which suggests that the new Central Valley line may actually end up being, if you’ll pardon the expression, a train from nowhere to nowhere.
Note: I don’t have space to list all the transportation conferences going on; below are those that I am (or a Reason colleague is) participating in.
IBTTA 80th Annual Meeting, Sept. 9-12, Hilton Orlando Bonnet Creek, Orlando, FL (Bob Poole speaking) Details at: www.ibtta.org/Orlando
2012 GPPF Georgia Legislative Policy Conference, Sept. 21, W Atlanta Midtown, Atlanta, GA (Baruch Feigenbaum speaking). Details at: www.gppf.org/default.asp?pt=eventdescr&EI=96
2012 ARTBA P3 Conference, Oct. 10-12, Renaissance Downtown DC Hotel, Washington, DC (Bob Poole speaking). Details at: www.artbap3.org
Keystone to Pennsylvania’s Transportation Future, Oct. 16, Hilton Harrisburg, Harrisburg, PA (Shirley Ybarra speaking) Details at: www.ncppp.org/calendars/Harrisburg_1210/HarrisburgPAflyer.pdf
Transpo2012, Oct. 28-31, Hyatt Regency Coconut Point, Bonita Springs, FL (Bob Poole speaking). Details at: www.itstranspo.org.
Reason’s $52 Billion Chicago Plan. Carefully targeted investment to modernize the greater Chicago region’s highway system would reduce projected 2040 congestion by 10% overall and by 20% within Chicago itself, according to a major report from the Reason Foundation’s Galvin Mobility Project. The plan includes a 275-mile HOT lanes network, a new Outer Beltway, and several urban highway tunnels. All the new capacity would be variably priced, and projected revenues of $58 billion would exceed the $52 billion construction cost, according to detailed modeling carried out for the study. “Countdown to Gridlock? Practical Strategies for Reducing Congestion and Increasing Mobility for Chicago” was produced by a team headed by Samuel R. Staley. (https://reason.org/news/show/chicago-mobility-reduce-congestion).
Steps Toward DC-Region Express Toll Network. On August 1st, Virginia DOT and the Fluor/Transurban joint venture that is nearing completion of the Capital Beltway (I-495) Express Lanes, reached commercial and financial close on the $940 million I-95 project. It will convert the existing two reversible HOV lanes to three reversible Express Toll lanes along 28 miles of I-95, interfacing on the northern end with the Beltway lanes. Across the river in Maryland, Montgomery County officials are considering extending the Beltway lanes across the American Legion Bridge into Maryland and onto their portion of the Beltway. And the Maryland State Highway Administration is studying potential express toll lanes for the I-270 corridor, which heads northwest from the Beltway.
Orange County Toll Roads Going All-Electronic. Last month the board of the Transportation Corridor Agencies in Orange County, CA approved a plan to convert their three toll roads to all-electronic tolling (AET). The estimated cost of the conversion is $14 million, and the target date for completion of the conversion is Fall 2013. Besides increasing the level of service for toll road customers, the change to AET will reduce future capital and operating costs for the aging 20th-century tolling system currently in use. More details: www.tollroadsnews.com/node/6066.
Connecticut Enacts Design-Build for Transportation. Thanks to passage of SB 33 in May, Connecticut became the 47th state to allow the design-build procurement method to be used for transportation infrastructure projects. Passage of the bill was a top priority for Gov. Daniel Malloy and the Design-Build Institute of America. The only three states remaining without design-build for transportation are Iowa, Nebraska, and Oklahoma.
Tax-Exempt Bond Subsidy is $258 Billion Over Five Years. Congress’s Joint Committee on Taxation last January released a study estimating that the losses of revenue to the U.S. Treasury due to the tax exemption for interest on tax-exempt municipal bonds will be $177.6 billion from 2011 through 2015. In addition, the tax-expenditure for private activity bonds will be $54.5 billion, another $24.4 billion for direct-pay bonds (such as Build America Bonds), and $1.8 billion for tax-credit bonds. That adds up to $258.3 billion over five years, or nearly $52 billion per year. Since this is one of the largest tax breaks for individuals (mostly affluent ones), it is sure to be a target for future tax-simplification and base-broadening reforms.
Largest Infrastructure Fund Exceeds $7 Billion. Infrastructure Investor reported on July 31st that the world’s largest infrastructure investment fund, Global Infrastructure Partners II, has amassed $7.02 billion in capital, towards its target of $8 billion. Overall, such funds have raised an estimated $200 billion over the past decade.
Port of Miami Tunnel at Half-Way Mark. The massive tunnel boring machine that is creating the tunnel between the Miami area’s expressway system and the Port of Miami on Watson Island has completed the first of two 4,200-foot tunnels under Government Cut. The next step is for the TBM to be turned around to dig the parallel tube over a six-month period. The $607 million tunnel is being procured under a 30-year concession.
Dutch Pension Fund Buys Stake in Texas Managed Lanes. Pension fund APG from the Netherlands has invested $300 million to acquire a 12.3% equity stake in the North Tarrant Express and a 13.3% stake in the LBJ managed lanes project. Both are being developed by a Cintra/Meridiam concession company. APG purchased its shares from Meridiam, which now holds 21% of NTE and 29.1% of LBJ. Both concessions are for 52 years.
Georgia High-Speed Rail Feasibility Questioned. A recent study by Georgia DOT declared as “feasible” passenger rail routes linking Atlanta to Jacksonville, Louisville, and Birmingham. A brief reality check by Kyle Wingfield on the Atlanta Journal-Constitution blog casts doubt on that conclusion. He created a table comparing the study’s estimated rail fare with current airline ticket prices for those city pairs, and also compared travel times, using three different assumptions on average rail speed. In nearly all cases, air travel is both cheaper and faster. (http://blogs.ajc.com/kyle-wingfield/2012/06/27/is-high-speed-rail-really-feasible-for-georgia)
Corrected URL for Parking Pricing Report. Last month’s issue included a link for the FHWA report on parking pricing that inoperative. The correct link is: http://ops.fhwa.dot.gov/publications/fhwahop12026/index.htm.
“The roadway statistics alone are staggering. China has built the largest single expressway system that now surpasses the U.S. Interstate system. Called the National Trunk Highway System (NTHS), its total length is currently 53,000 miles. The Chinese copied the U.S. Interstate system’s model in many ways: plans of connecting major population centers, design specifications, and signage. One major difference: the expressways are toll roads (over 75 percent) that are run by public-private partnerships.”
-Dan McNichol, “American Road Building in China,” Transportation Builder, March-April 2012.
“Transit-oriented developments (TODs) by themselves are not a major contributor to transit ridership. Income and auto access are much more related to whether someone uses transit. Car ownership is the number one variable in determining commute choice. Demographics are another important factor. Most TOD residents are more highly educated, with higher incomes. This demographic group tends to drive more. Unfortunately, these developments often tear down existing housing used by low-income individuals. While residents who move to TODs use transit more in these developments than in their previous homes, they use transit less than the displaced residents.”
-Prof. Brian Taylor, UCLA, interviewed by Baruch Feigenbaum, Jne 15, 2012 (https://reason.org/news/show/interview-with-university-of-califo)
“While the merits of various strategies needed to be weighed, there is one thing that CPPIB never had doubts about-and that was the desirability of investing in in infrastructure one way or another. We have long-term assets and liabilities, and infrastructure is very well tailored to that. Because of our long-term focus, we can invest beyond the limitations of fund cycles. We look to hold our investments for 20 or 30 years.”
-Alain Carrier, Canada Pension Plan Investment Board, interviewed by Andy Thomson, “The Road Not Taken,” Infrastructure Investor, June 2012
“There’s a race (to develop) all these alternative fuels, and the one that has advanced the furthest in this 100-yard dash is natural gas. We use biodiesel because it’s the law. We’re migrating toward natural gas because we want to.”
-Glen Kedzie, American Trucking Associations, quoted in “Natural Gas-Powered,” The Journal of Commerce, July 16, 2012, p. 14
“Amtrak’s proposal to bore a 10-mile rail tunnel underneath Philadelphia . . . would require the most expensive type of tunnel imaginable. At $10 billion, it would be about three times as expensive per mile as the Gotthard Base Tunnel under the Swiss Alps. And all this for marginal improvements in speed and access. The tracks around and through Philadelphia aren’t, generally, big obstacles to high-speed rail-the tunnels around Baltimore are. It would be much cheaper to replace Baltimore’s terrible tunnels than to build a fancy new one under Philadelphia.”
-Gulliver, “The Most Expensive Tunnel in the World,” www.economist.com/blogs/gulliver/2012/07/rail-renovations
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