In this issue:
- Congestion is back, at record levels
- More managed lanes, as projects proliferate
- When are exclusive bus lanes warranted?
- Would RIFIA seriously reform the RRIF program?
- Good prospects for greener heavy trucks
- Report on 2015 automated vehicles conference
- Upcoming Transportation Events
- News Notes
- Quotable Quotes
Last month saw the release of two important reports. First, the Federal Highway Administration released the June edition of its Traffic Volume Trends. This report found that the accelerating trend in vehicle miles of travel (VMT) from last year and this year continued in June, up 3.9% from June of last year, at 275.1 billion VMT. And overall VMT for the first six months of this year is up 3.5% over the comparable period in 2014. VMT growth is much stronger in the South (4.4%), South Gulf (4.6%) and West (5.7%) than in the Northeast (1.1%), which may explain why New York-based media were the last to notice what’s been going on. If you check out the graph on page 9 of the FHWA report, showing total VMT by year from 1991 through 2015, you can see that the upward slope of the last three years is about the same as the long-term historical trend from 1991 through 2006. In short, total VMT growth appears to be back to normal.
And that leads us to the 2015 Urban Mobility Scorecard, released as the joint product of the Texas A&M Transportation Institute (TTI) and INRIX. As their Aug. 26th news release states, “America’s traffic congestion recession is over.” Traffic congestion has not only returned to, but now exceeds, pre-recession levels. The total estimated cost in wasted time and fuel has reached a new high of $160 billion in 2014 dollars. (http://mobility.tamu.edu)
It’s important to note that thanks to much more detailed traffic data now being produced by INRIX, the methodology used to derive the numbers in this report has been significantly revised. Because of this, TTI’s project team had to go back and re-do all the numbers in their database back to 1982, in order to provide apples vs. apples comparisons. That process took so long that there were no mobility reports in 2013 or 2014, which has been a problem for transportation wonks like me, who have had to rely on increasingly out-of-date congestion numbers until now.
To illustrate that overall congestion has reached new highs, here are a few national-level summary numbers from the new report, comparing the base year of 1982 with the lowest recession-year numbers and the new figures for 2014.
|Travel time index
|Average delay/commuter (hours/year)
|Total delay (billions of hours)
|Wasted fuel (billions of gallons)
|Total cost of time and fuel wasted, $B
While the average delay per commuter is 42 hours/year, in metro areas of one million or more people it is 63 hours/year. And in the largest metro areas it is far higher: 82 hours in DC, 80 in Los Angeles, and 78 in San Francisco. And the cost per person (of wasted time and fuel) tops out at $1,834/year in DC, followed by $1,739 in New York and $1,711 in Los Angeles. Those are measures of the intensity of the congestion encountered by individual commuters.
What about the total magnitude of a metro area’s congestion? A separate set of tables provides those numbers, for metro areas grouped into Very Large, Large, Medium, and Small. In terms of total congestion, New York tops the list, with 628 million hours in 2014 and total congestion cost of $14.7 billion. Long-first-ranked Los Angeles now ranks second, at 622 million hours and $13.3 billion. Nobody else comes close, with third-ranked Chicago at 303 million hours and $7.2 billion, followed by DC at 204 million hours and $4.6 billion.
As expected, advocates of transit and “smart growth” are rolling out critiques of the TTI/INRIX report, as if breaking the thermometer would make the temperature go down. The report focuses only on drivers? Yes, because they are the vast majority of commuters nationwide. The measure is misleading, because it compares free-flow speeds to rush hours? Well duh, that’s what congestion is. That doesn’t mean that the optimum, cost-effective solution is zero peak-period congestion, but it is the most straightforward way to measure the magnitude of the problem.
Ominously, the critique from the T4America blog includes the following sentence: “The proposed rule for congestion being drafted right now by USDOT will lay out exactly how states and metro areas will have to begin measuring congestion-and measuring whether or not the projects they want to build will improve it.”[emphasis added] That kind of central planning will likely increase the credibility of those calling for devolving the whole program back to the states.
Last month I did a webinar for the P3 Division of the American Road & Transportation Builders Association (ARTBA). The theme of the webinar was to assess the suitability of P3 concessions as a way to procure priced managed lane projects. In preparing for the webinar, I collected recent data on traffic and revenue from five of what I termed Type 1 managed lanes (basically conversions of HOV lanes that sell excess capacity and continue to serve HOV-2s at no charge) and six Type 2 projects (which sell faster and more reliable trips to paying customers, and also provide either reduced-rate or free trips to HOV-3s). Type 1 projects typically use any surplus revenues (after operating & maintenance costs) to pay for transit service in the corridor, while Type 2 projects use their net revenues to pay debt service on bonds issued to produce the new lanes built for the project). Needless to say, it is Type 2 projects that are a good match for P3 procurement, since they are the ones that both need hefty toll revenues and can generate them, since they don’t give away most of their capacity to non-paying vehicles.
To illustrate my point, I included traffic and revenue slides, one for Type 1 projects and the other for Type 2, all showing 2014 traffic and revenue. For the five Type 1 managed lanes, all of which have been in operation for two or more years, average daily (tolled) traffic was 3,900, and average 2014 gross revenue was $2.86 million. By contrast, for the six Type 2 projects, average daily (tolled) traffic was 34,000 and 2014 gross revenue averaged $36 million. The Type 2 projects had nearly 10 times the ADT and more than 10 times the gross toll revenue.
A couple of qualifiers should be noted. Most of the Type 1 projects have one lane per direction, while most of the Type 2s have two lanes each way. In addition, the two relatively new Los Angeles projects-both of which are Type 1 conversions of HOV lanes-did far better than the average of their group, but their numbers arrived too late to be included in the tables. The I-110 express lanes averaged 29,000 ADT last year and generated $25 million, while the I-10 express lanes also averaged 29,000 and generated $16 million. Those facilities both have two lanes each way and are in highly congested corridors, which may be why their numbers are so much higher than the other Type 1 projects.
After my last update on managed lane projects around the country (July issue), I heard from a number of transportation colleagues asking why their projects had not been included. So with apologies to everyone, here are some additional projects now under way.
California: Riverside County has under construction a $1.4 billion extension of the original SR 91 express lanes (which currently exist only in Orange County), extending the lanes from the Orange County line eastward to a new interchange with I-15. Completion date will be sometime in 2017.
Colorado: Besides the recently opened managed lanes on U.S 36 between Denver and Boulder, CDOT has four other projects under way. A concession for rebuilding 12 miles of I-70 East with express toll lanes added is in the bidding process. Under construction are an extension of the existing managed lanes on I-25 north of downtown Denver and the addition of tolled peak-period shoulder lanes on I-70 in the mountains west of Denver. And procurement is under way for the C-470 tolled express lanes on the southwestern portion of the beltway around metro Denver.
Florida: The Turnpike has announced two more projects to add variably priced express lanes to existing toll roads: on the Sawgrass Expressway in the Fort Lauderdale area and on the Turnpike mainline between the Sawgrass and Boca Raton in Palm Beach County. Similar projects are already under construction on the Turnpike’s Homestead Extension in Miami-Dade County and on the Veterans Expressway north of Tampa.
Massachusetts: The Bay State’s first P3 concession is likely to be an express toll bridge. The new bridge would be an alternative to two aging, non-tolled bridges to and from Cape Cod, the Sagamore and Bourne Bridges.
North Carolina: Opponents of the already-financed P3 concession project to add managed lanes to congested I-77 in Charlotte continue to protest, but the Charlotte Regional Transportation Planning Board voted overwhelmingly (54-10) to keep the project in its Transportation Improvement Plan for 2015-2016.
Puerto Rico: Abertis, the concessionaire for the PR-22 toll road near San Juan, added what it calls Dynamic Toll Lanes to 6.4 miles of the toll road’s median. The two reversible express lanes operate inbound to San Juan in the morning and outbound in the afternoon, serving variable-toll-paying autos and express BRT buses.
Texas: The big news this month is the Sept. 10th grand opening of the LBJ Express, a $2.8 billion managed lanes toll concession on one of the state’s most congested freeways, I-635 in Dallas.
Virginia: Despite earlier suggestions that it might procure the project conventionally, Virginia DOT has issued a draft RFQ for P3 procurement of its $2.1 billion project to add express toll lanes to 25 miles of congested I-66 outside the Beltway. This will be the third link in the region’s evolving network of managed lanes. Five consortia held meetings with VDOT to discuss the project prior to the RFQ’s release on Aug. 31st.
Washington State: The I-405 Express Toll Lanes, along 27 miles of I-405 east of Seattle, are scheduled to open to traffic on Sept. 27th.
My apologies to any agency whose project was not included in either this update or the previous one in July. Please keep me posted.
A small but growing number of transportation researchers (including me) have argued for years that bus rapid transit (BRT) is generally far more cost-effective than light rail, as well as being a lot more flexible due to not being confined to a single guideway. But now that the BRT idea is gaining more adherents, ill-considered projects threaten to make arterial traffic congestion far worse. The culprit is conversion of existing general-purpose lanes to bus-only lanes.
Examples are proliferating. The draft 2040 Regional Transportation Plan for the Austin metro area calls for converting a number of major downtown streets to bus-only-including Riverside Drive, South Congress, North Lamar, Guadalupe, and several others. A major study recently completed in Boston proposed “gold standard” BRT service on exclusive lanes on five major corridors where bus ridership is already high and travel times are slow. The Los Angeles City Council last month approved a 20-year transportation plan that would convert hundreds of miles of traffic lanes to bike lanes and bus-only lanes. And the Metropolitan Planning Organization for Miami-Dade County in February approved a project development study of converting one lane each way to bus-only use on three major arterial corridors: NW 27th Avenue, Flagler Street, and Kendall Drive. Pretty renderings show articulated buses operating in 11 ft. curbside lanes, alongside widened 15 ft. sidewalks, with only two 11 ft. general purpose lanes each way.
What is not being discussed very much (or at all) in these cases is the impact on traffic congestion of converting general-purpose lanes to bus-only use-especially during peak periods when most major arterials are already seriously congested in these metro areas, operating at Levels of Service E or F. Reports that assess such impacts do exist, including a 1975 report from the National Cooperative Highway Research Program, “Bus Use of Highways: Planning and Design Guidelines” (NCHRP 155). That report recommends that the minimum one-way peak hour bus volume needed to justify a curb bus lane is 50 to 80 buses/hour, carrying 2,000 to 3,200 passengers.
A recent report by smart growth advocate Todd Litman cites that report, along with several others proposing significantly lower thresholds. Litman argues for using a whole array of factors, not just traffic/congestion impacts-including social equity objectives and ensuring that “bus passengers receive their fair share of public road space.” (“When Are Bus Lanes Warranted?” Victoria Transport Policy Institute, August 2015)
Several years ago my traffic engineer friend and colleague Chris Swenson worked with me on a major study on improving mobility in Southeast Florida. Our report recommended a large-scale expansion of both “BRT Lite” service in mixed traffic on arterials and longer-distance region-wide express bus service operating on major arterials and on the envisioned network of freeway managed lanes (which is now being developed). We looked at how to handle the express buses on major arterials, and found that bus-only lanes would have serious negative effects on congestion. On a typical six-lane major arterial in Southeast Florida, with traffic signals at about one-mile intervals, our quantitative analysis found that converting one lane each way to bus-only would increase congestion from LOS E to LOS F unless bus ridership increased to 34% of all people using the corridor during peak periods. That high a transit mode share was so far beyond anything contemplated in long-range transportation plans that we rejected it as fantasy.
Instead of bus-only lanes, we modeled the addition of electronically tolled underpasses at key signalized intersections, in which motorists would have the option of paying a modest toll of 15 to 35 cents (depending on time of day) to bypass what is often a 3-minute traffic signal cycle time. Our modeling showed that an arterial reconfigured in this manner would have greater person throughput than the six-lane arterial with two bus-only lanes at all conceivable percentages of transit mode share. We dubbed the concept “managed arterials,” and described it in TRB paper 12-1248, which was later published in Transportation Research Record 2297. Revamping major arterials as managed arterials would be far wiser than converting some of their lanes to bus-only use.
Earlier this year, I posted a one-page policy brief calling for the addition of taxpayer safeguards to the open-ended Railroad Rehabilitation and Improvement Financing (RRIF) program. Under current law, the Federal Railroad Administration can use its $35 billion pot of money to loan railroad companies (including Amtrak and start-ups) 100% of the cost of a capital improvement project, without even a requirement for an investment-grade rating. I urged Congress to add taxpayer protections of the kind included in the successful TIFIA program. (https://reason.org/news/show/add-taxpayer-protections-to-fras-rr)
In June, Sen. Cory Booker (D, NJ) and Sen. Roger Wicker (R, MS) introduced, as part of a larger railroad reform bill, a proposed RIFIA measure-the Railroad Infrastructure Financing and Improvement Act-aimed at converting RRIF into something more like TIFIA. In particular, it is intended to encourage public-private partnerships (P3s) to improve railroad infrastructure.
Besides enabling RIFIA loans to be made to a P3 entity designated by the public sponsor of a railroad project, RIFIA would require loans larger than $75 million to receive at least two investment grade ratings. A RIFIA loan would also be elevated to senior debt status in the event of bankruptcy, similar to the “springing lien” provision of TIFIA. But as far as I can tell, there is no limitation on the fraction of a project’s cost that could be covered by a RIFIA loan, which is a key feature of TIFIA intended to emphasize the latter’s function as gap financing, to supplement what is available in commercial debt markets.
Also, I remain troubled by the desire of many legislators in the Northeast to have RRIF or RIFIA focus much of its lending on Amtrak. A major current focus is the aging Amtrak tunnels between New Jersey and New York. DOT Secretary Anthony Foxx has offered RRIF loans to help pay for the proposed $14 billion Gateway tunnels-a proposal vociferously rejected by New York Gov. Andrew Cuomo, in an Aug. 7th letter to Foxx. Cuomo wants federal grants, not loans. He had declined to take part in a meeting that Foxx held with New Jersey Gov. Chris Christie and New Jersey’s two Senators to discuss financing the tunnel project.
As I pointed out in the April issue of this newsletter, Amtrak has no way to repay RRIF (or RIFIA) loans. As a government corporation, it loses several billion dollars a year, a loss that is made up by annual federal tax money appropriated by Congress. A $14 billion tunnel project would not generate a revenue stream to repay even a $1 billion loan; it would not even erase Amtrak’s annual loss. So in a sense Cuomo is correct: federal loans cannot solve Amtrak’s funding problem. Pretending that RRIF or RIFIA (if it is enacted) could do so is a fool’s errand.
Trucks handle more than two-thirds of all freight in the United States. And “heavy” trucks-those designated as Class 8-consume 28 billion gallons of fuel per year. Trucks in Class 8A average about 6 miles/gallon, a number that has hardly changed in decades. The first-ever mpg standards for medium and heavy trucks were introduced in 2011, effective with the 2014 model year, requiring a 20% reduction in fuel consumption. Since fuel is the second-largest expense for trucking companies, the industry has supported the new standards-and truck sales surged last year to gain the savings from the new, more fuel-efficient vehicles.
In June 2015, the EPA and DOT announced Phase 2 truck fuel economy standards, which will apply to trucks built between 2021 and 2027. They will require another 24% reduction in fuel consumption compared to 2018 levels. You may be surprised to learn that the leading trucking organization-the American Trucking Associations-generally supports the phase 2 standards. ATA’s news release in response to the Phase 2 announcement noted that ATA has adopted 15 “guiding principles” for Phase 2, and that the new proposal “appears to meet 14 of those.” ATA also pointed out that the industry spent $150 billion on diesel fuel last year. EPA estimates that over the useful life of the trucks affected by the new rules, their total fuel savings will be $170 billion, accompanied by a reduction in greenhouse gases of one billion metric tons.
The big question is whether the technology will exist to achieve the Phase 2 goals at an affordable cost. And the good news is that many engineers and trucking experts think this will be do-able. The low-hanging fruit is further reductions in aerodynamic drag from additional streamlining-such as replacing huge side mirrors with rear-facing video cameras. Michelin and other tire companies argue that replacing narrow twin tires with single wide tires can reduce rolling resistance (and weight), gaining up to 10% fuel savings.
But the bigger (and possibly more costly) gains could come from propulsion system changes. Thanks in part to the fracking boom, there is a small but rapid movement toward propane use for delivery trucks, such as those of UPS. Propane these days costs less than half as much as diesel and is cleaner-burning than gasoline or diesel. But like liquefied and condensed natural gas (LNG and CNG), propane lacks nationwide refueling infrastructure, so is limited to local fleets that can be refueled from a central depot.
For Class 8 big-rigs, an intriguing possibility is hybrid diesel-electric propulsion. A Kentucky-based start-up called ePower Engine Systems has developed a power train that can be retrofitted into existing Class 8 tractors. Basically, it adopts the model long used by diesel locomotives (which are actually diesel-electrics). The diesel engine drives a generator that powers electric motors, in what is called a “series hybrid” configuration. The company uses a much smaller diesel engine than a conventional Class 8-a 6.7 liter diesel mated to a 150 KW generator. That delivers normal performance on level terrain. For climbing grades-which requires hugely more power for a 55,000 lb. Class 8A rig-this is supplemented by a battery pack that adds another 120 KW, only when needed to accelerate or climb grades. The batteries recharge from surplus generator power, downhill grades, and braking. Testing done by ePower shows that its overall system is 40-60% more efficient than a conventional diesel that meets current Phase I standards. The company also claims that their drivetrain will repay its price premium in 30 months and return a $90K profit over five years. I am in no position to verify their figures, but am presenting this information as an illustration of what may well be possible via improved propulsion technology.
In short, very real progress may be in store for large trucks, reducing their fuel use and greenhouse gas emissions, at what is likely to be an affordable cost. This looks to me like a win-win situation in the making.
This was the largest TRB Automated Vehicle gathering yet with almost 1,000 attendees from all over the globe. About 70% were from the private sector, 15% from some level of government, and 15% academic and non-profit. Unlike past years’ events that focused primarily on technical sessions, this year included a number of non-technical and policy sessions.
There were a number of plenary sessions. One of the best presentations detailed why, despite recent technological improvements, we have quite a ways to go before we reach Level 5 (fully) automated vehicles (AVs). Chris Gerdes of Stanford discussed human decision-making that is difficult to replicate in AVs. For example, if there is a child and a ball in the path of the AV and the vehicle can only stop for one, which one does it stop for? If a vehicle is illegally parked blocking the travel lane on a two-lane road, does the AV break the law and cross the double-yellow line or does it wait behind the vehicle for 8 hours until the vehicle’s owner returns? These types of questions are easy for a human to answer but far more challenging for an artificial intelligence.
Another top plenary session focused on attracting venture capital for AV research and deployment. AV research has benefitted from direct government funding. But now that many small companies are developing projects, they lack investment capital. Crowdsourcing, selling stock and creating advisory committees are not new in the corporate world, but they are novel concepts for some AV makers.
A third top session focused on state and local AV issues. Texas Transportation Institute surveyed a number of policymakers to determine whether they think AV adoption will be evolutionary (slow regulatory change despite rapid technological advances) or revolutionary (manufacturers pushing and consumers buying). While some combination is likely (trucking could benefit the most in the early stages), respondents were split on which will be the more likely path. However, respondents preferred the revolutionary path by two to one. While incorporating AVs into planning efforts and improving road infrastructure (quality of painted lines, eliminating potholes) are important near-term goals, coping with uncertainty will be the biggest challenge for the public sector.
With the recent data breaches and vehicle hacking, several of the breakout sessions focused on security. Speakers detailed that security features in all-electronic tolling systems shield customer data, that 19 manufacturers agreed to automotive privacy principles such as requiring a warrant for geolocation information, and that seven statutes exist on privacy in various sectors (for example: HIPPA in health care)-but none that are directly applicable to AVs. There are also several unknowns such as how the Fourth Amendment (unreasonable searches and seizures) will apply to AVs.
Because AV technology is developing so quickly, the hot AV policy issues change from year to year. One of this year’s hot issues was misinformation. Many imagined AV capabilities are not feasible, and policymakers need to separate the hype from the facts. There are huge differences between levels of autonomy. Today’s vehicles are SAE Level of automation 2 (partial automation) at best (adaptive cruise control, lane-keeping, automatic braking). Level 2 is profoundly different from Level 5 (full) automation. Further, once Level 5 vehicles are introduced, widespread fleet penetration will take another 20 years. While there is considerable hype, AVproducers are not considering some public safety and security challenges. For example, the automotive world is not the information technology world. Drivers will not accept beta testing, as Microsoft Windows users do. AV software needs to be right all of the time, not 99% of the time. Additionally, there are a number of issues people worry about that are so far over the horizon, they are not worth thinking about today, such as drastically reducing parking capacity and eliminating the need to build new roads.
This year’s conference illustrated the value of raising and debating various public policy issues. Let’s hope next year’s conference continues the trend of bigger and better AV policy discussion.
Note: I don’t have the time or the space to list all transportation events that might be of interest to readers of this newsletter. Listed here are events at which a Reason Foundation transportation researcher is speaking or moderating.
U.S. Chamber Western Regional Affairs Conference, Sept. 30-Oct. 2, 2015, Las Vegas, NV, The Mirage Hotel (Adrian Moore speaking). Details at: https://uschamber.com/members/chambers/2015-regional-government-affairs-conferences.
Highways as Network Utilities, Oct. 2, 2015, ASCE luncheon meeting, Orlando, FL (Robert Poole speaking). Details from: email@example.com.
Advanced Transportation Technologies Conference, Oct. 9, 2015, Mercer Island, WA, Community & Events Center (Baruch Feigenbaum speaking). Details at: www.aboutcates.org.
U.S. Chamber Eastern Regional Affairs Conference, Oct. 14-16, 2015, Nashville, TN, Loews Vanderbilt Hotel (Adrian Moore speaking). Details at: https://uschamber.com/members/chambers/2015-regional-government-affairs-conferences.
2015 American Metropolitan Planning Organization (AMPO) Conference, Oct. 20-23, 2015, Las Vegas, The Westin-Clark County (Baruch Feigenbaum speaking). Details at: www.ampo.org
Transportation Crossroads Conference, Nov. 6, 2015, Dallas, TX, Hilton Anatole (Baruch Feigenbaum speaking). Details at: http://ndcc.org/chamber-events/annual-events/transportation-crossroads-conference
Detroit-Windsor Toll Bridge P3 Under Way. The Windsor-Detroit Bridge Authority issued a request for qualifications (RFQ) on July 20th for teams interested in competing for a design-build-finance-operate-maintain concession for the $2.2 billion toll bridge over the Detroit River. The project includes a cable-stayed bridge and TSA and Customs facilities to handle cross-border trade and traffic between the two countries, at this very busy border crossing. The Canada-based bridge authority will take the toll revenue risk on the project, compensating the concession company via annual availability payments.
Reason TV Interview with Your Editor. Several weeks ago, Reason magazine’s Matt Welch interviewed me about the Highway Trust Fund and congressional action/inaction on the federal program. At nine minutes, it’s short and succinct, but you may enjoy my thoughts directed at a general audience. You can view it at: http://reason.com/archives/2015/08/24/highways-need-trillion-dollar-fix.
HOT Lanes Endorsed in Canada. An August 31 editorial in the Toronto Star endorsed the Ontario government’s plans to convert HOV lanes in Toronto into high-occupancy toll (HOT) lanes. After noting the success of such lanes in the United States, the editorial went on to note that a network of HOT lanes would offer even greater benefits than just individual facilities. (www.thestar.com/opinion/2015/08/31/welcome-hot-lanes-to-ontario-editorial.html)
Toll Road Cash Cow Lawsuits: One Up, One Down. Two current legal challenges to the diversion of toll revenues to other uses fared oppositely in courts last month. In New York State, the U.S. Court of Appeals for the 2nd Circuit ruled that a trucking industry suit against the New York Thruway Authority (whose diverted toll revenues fund the Erie Canal, among other things) may proceed, since the Authority does not have sovereign immunity. But in Ohio, a citizen lawsuit against the Ohio Turnpike for diverting toll revenue to other highways was dismissed by a federal judge, on the grounds that the toll payers still derive some benefits from the funded projects.
Uber to Provide Elderly Rides in Gainesville, FL. In a first of its kind pilot project, the City of Gainesville and Uber have launched Freedom in Motion, under which senior citizens can obtain below-cost rides 24 hours a day, with a co-pay of up to $5. The city government is putting $15,000 into the project for its first six months, after which a decision will be made about expanding it.
National Truck Parking Group Formed. In light of U.S. DOT and trucking industry data indicating a serious lack of safe parking spaces for long-distance truck drivers, the industry and several DOT agencies have created the National Coalition on Truck Parking to seek solutions. AASHTO, representing the state DOTs, has pledged its support of the effort. Almost half of the state DOTs that were surveyed reported problems of truckers parking on freeway ramps and highway shoulders in order to rest, especially during night hours.
“Self-Driving Cars Cheaper and Better than Light Rail: Expert”. That was the headline of an article published in Australia’s Canberra Times on August 30th. Data consultant Kent Fitch developed a simulation model of a self-driving car fleet for Canberra, finding that a fleet of 23,000 cars could handle 750,000 daily trips at a cost of $3.80 for each 13 km peak-hour trip. That cost compares with $13.33 for a private car, $10.35 for a transit bus, and $22 for the planned light rail line. (www.canberratimes.com.au/act-news/selfdriving-cars-cheaper-and-better-than-light-rail-expert-20150828-gja3hr.html)
Major Source of Data on Highway Tunnels. Austroads has compiled and published an important new resource on highway tunnels (tolled and non-tolled) in Europe, Asia, North and Central America, Australia, and New Zealand. Its four chapters include information on how the data were gathered and an overview and comparison of tunnel practices in the different regions. A large Appendix A provides details on relatively new or recently refurbished highway tunnels in each of the regions studied. Two additional appendices summarize tunnel safety guidelines and minimum European tunnel design requirements. Review of Overseas Tunnels is available at: https://onlinepublications.austroads.com.au/Items/AP-T300-15.
Follow-up on Vehicle Hacking. An Aug. 5th Bloomberg News story by Jeff Plungis and Chris Strohm revealed that Fiat Chrysler knew of the hacking risk to their Jeep vehicles 18 months before the recall of over a million Jeeps this summer-but did not inform NHTSA about it. It was only after the company notified the agency that NHTSA (just eight days later) ordered the recall. And on Sept. 4th, David Shepardson of the Detroit News reported a second hacking-related recall by Fiat Chrysler, this one of just 7,810 SUVs equipped with a radio that could be an avenue for cyber-hacking. Meanwhile, after a presentation at the annual DEFCON conference on the hacking of a Tesla Model S, the company within days sent out a software fix via the cars’ existing wireless internet connection.
Jones Act Still Under Fire. With Congress on its August recess, no action has taken place on proposals to exempt nearly bankrupt Puerto Rico from the costly Jones Act, which requires all shipping between there and the mainland to be carried out on ships owned, operated, and crewed by Americans. A court case filed by shippers seeking to free Hawaii from the Jones Act was dismissed by the Ninth Circuit Court of Appeals, on grounds that the six shippers lacked standing to file such a suit. But in making its ruling, the Court also held that this protectionist law does not violate the Commerce Clause of the Constitution. Meanwhile, the Philippines has deregulated shipping among its numerous islands, opening this trade to overseas companies.
Private Commuter Rail Line Proposed in Northeast. Boston Surface Transportation Railroad Co. has announced plans for a privately funded commuter rail service between Providence, RI and Worcester, MA. The route is 45 miles long and there is a well-maintained freight railroad track connecting them, served by freight railroad Providence & Worcester Railroad Co. The commuter company’s CEO, Vincent Bono, says their capital costs will be just $3 to $5 million, since they need to build only a short passing track and a platform at the Worcester railroad station. It plans to buy three refurbished Amtrak locomotives and 12 former Amtrak passenger cars.
Christie Vetoes New Jersey P3 Law. Gov. Chris Christie has “conditionally vetoed” a bill that would expand the state’s public-private partnership law. He sent the bill back to state senate, objecting to the bill’s prevailing wage and project labor agreement provisions. According to an article in Infrastructure Investor, it was unclear whether the senate would consider amending the bill as proposed by Christie.
Good Reading on Street Parking in DC. Ike Brannon and Dryan Weaver wrote a short article for City Journal on the problem of DC residents using free curbside parking to store vehicles for long periods of time, rather than renting space in a garage. They suggest periodic auctions of parking spots in each neighborhood, compared with the $25 annual residential parking permit. As they report, the going rate for a private parking spot in some neighborhoods is $250 per month. You can read “Parking for a Price” at www.city.journal.org/2015/eon0813ik.html.
Auto Insurance and Autonomous Vehicles. KPMG has carried out a survey of auto insurance executives on the implications for their industry of the evolving development of autonomous vehicles. While most of the respondents expected little market penetration of AVs for the next decade, once AVs start to become mainstream, there could be significant changes in auto insurance. With the expected reduction in accidents, claims will decrease and so will premiums paid by individuals. Depending on legal and regulatory factors, much of insurance could shift from vehicle owners to manufacturers. “Automobile Insurance in the Era of Autonomous Vehicles: Survey Results, June 2015,” is available at kpmg.com/insurance.
Assessment of Hamilton Project Report on Infrastructure Financing. When I testified before the House Ways & Means Committee in June on the future of the Highway Trust Fund, my fellow witnesses and I were asked to submit written comments on a report from the Brookings Institution’s Hamilton Project, “Financing U.S. Transportation Infrastructure in the 21st Century.” Among the policies proposed is to bring back the short-lived Build America Bonds. After reading and thinking about the report, I prepared a five-page commentary for the Committee, which as far as I know has not been published. I’d be happy to send a copy to any reader of this newsletter who is interested.
“[P]otentially monopolistic but capital-intensive energy, water, transportation and other companies . . . remain in the private sector if state or federal utility commissions regulate their rates and other activities. These private sector companies have been successful and they are not the ones getting failing grades from the American Society of Civil Engineers. They fund what they need as they go along. In 2014, these types of companies raised $750 billion in global capital markets. The ones with the failing grades are the government owned ‘public goods’ enterprises that operate highways, passenger rail airports, and other systems that are used by the public at large. . . . The system for funding public good infrastructure, however, has collapsed into a morass of politically overlapping jurisdictions . . . that politicians are reluctant to fund. . . . The simple truth is that public infrastructure is fully financeable as long as tolls are set high enough to generate revenues to cover capital and operating costs. If so, bonds issued by the entities can readily be sold to investors in global capital markets.”
-Roy C. Smith, NYU Stern School of Business, “U.S. Infrastructure Financing Needs to Change Track,” Financial News, Aug. 13, 2015 (www.efinancialnews.com/story/2015-08-10/us-infrastructure-financing-needs-to-change-track)
“The worst part is the capitulation [by Congress] to using non-transportation funds for the capital and operating costs of transportation. The virtue of gas taxes is user pays, user benefits. If the tax has become less of a proxy for transportation consumption due to more efficient cars and lower energy prices, then prioritize federal highway money for the most urgent national needs and devolve more power to the states and cities, which can use tolls and their own fuel levies to lay asphalt.”
-Editorial, “Mad Tax Fury Road,” The Wall Street Journal, July 28, 2015
“A lot of the [highway] money is misspent or badly spent. In addition to tapping off highway money for subways, bike paths, and the like, the ‘prevailing wage’ provisions of the Davis-Bacon Act generally require excessively high union wages and cumbersome work rules on federally assisted projects. . . . To fix the highway trust fund, Congress should stop tapping it for other purposes; tax mass transit rides to finance the federal contribution to new system construction and other improvements; impose an excise tax on bikes, tires, and repairs; and raise national park fees to finance scenic overlooks and outdoor recreational projects. Along with canceling Davis-Bacon so that we get our money’s worth from highway dollars spent, making up the difference by raising the gas tax and indexing it to inflation makes good environmental sense and is the fairest policy.”
-Peter Morici, University of Maryland Smith School of Business, “Raise Gas Tax; Reform Federal Highway Trust Fund,” syndicated column, Aug. 19, 2015