Surface Transportation News #158
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Surface Transportation Innovations Newsletter

Surface Transportation News #158

A careful look at Trump's infrastructure proposal

In this issue:

A Careful Look at the Trump Infrastructure Proposal

Since the November 8th election, a flurry of media attention has been devoted to the “Trump infrastructure plan.” As I pointed out in my column in the November Public Works Financing, three separate proposals have been made by people involved with the campaign or the transition: a $550 billion number with no details on how it would be paid for, a suggestion of an infrastructure bank, and a $1 trillion proposal for P3 infrastructure, developed by investment banker Wilbur Ross and economist Peter Navarro. The latter is the only proposal with details, so it has become the focus of most of the attention in recent weeks. (http://reason.org/news/show/trump-era-bring-new-infrastructure)

Amazingly, many people seem to have interpreted the $1 trillion number as implying new federal spending of that volume. But the only federal money in the Ross/Navarro proposal is up to $137 billion in tax credits for P3 projects—assuming that a total of $1 trillion worth were ultimately financed and built. But the mistaken idea of a trillion-dollar flood of federal dollars sent the stock prices of engineering and construction firms soaring 10-50% in the three weeks following election day. The flip side of this misunderstanding is that a number of fiscal conservatives in Congress have denounced the proposal as if it actually were a trillion-dollar call on the federal budget.

But as the true P3 nature of the proposal sinks in, an array of commentary has emerged from diverse sources. Wall Street Journal financial writer Spencer Jakob pooh-poohed P3 toll roads, citing a Congressional Budget Office report that found that four out of 14 such projects either filed for bankruptcy or were bought out by the public sector. As privatization expert Steve Savas noted in a letter to the editor, the Orange County project (the 91 Express Lanes) has been highly successful and was bought by the county transportation authority only so it could do away with an overly stringent non-compete provision. And the formerly troubled Chicago Skyway and Indiana Toll Road (ITR) were both purchased last year by pension funds at a large premium to their last-decade asset value.

More predictable have been attacks from the political left. Streetsblog‘s Angie Schmitt claimed that P3 concessions rely mostly on “other people’s money,” which implies taxpayers’ money—which is false. According to a recent tally in Public Works Financing, the average U.S. revenue-risk P3 highway project was financed with 25% equity, and most of the rest by debt that is to be serviced by toll revenues. The just-financed I-66 express toll lanes project in Virginia involves 40% equity, and last year’s pension-fund acquisitions of the Skyway and ITR both involved more than 50% equity.

One of the longest critiques of the Ross/Navarro P3 proposal is from Kevin DeGood of the Center for American Progress. I don’t have space here for a detailed rebuttal; my Reason colleague Baruch Feigenbaum posted one last week, “Center for American Progress Critique of Trump’s Infrastructure Plan Is Misleading” (http://reason.org/news/show/center-for-american-progress-critic).

One of DeGood’s main complaints is about the proposed tax credits for the equity investors, about which he writes, “Aside from enriching Wall Street, what does this federal subsidy buy? The answer is effectively nothing.” Which would be nonsense if the tax credit actually generated nearly $900 billion in sound projects to repair and replace aging and inadequate infrastructure. Yet, as I wrote in my PWF column, the tax credit is unlikely to be needed. P3 infrastructure investors have plenty of incentive to invest in sound U.S. projects; their problem is that only a handful of projects are on offer. And that contrasts sharply with countries like Australia, Canada, Chile, Colombia, France, and many others where P3 infrastructure is national policy.

In addition to DeGood, a number of reporters have put forth the idea that projects with bondable user-fee revenue streams are few and far between. But that is mostly false and generally misleading. To be sure, most states do not yet have workable P3 enabling legislation. But there are thousands of candidate projects out there. In the highway sector, the potential for toll-financed replacement of worn-out Interstate highways and bridges is a $1 trillion unfunded need all by itself. America also has a very large unfunded need to replace aging municipal water systems. The good news for that sector is that user fees (water bills) are a long-established reality. Airports and seaports also have long-established user-fee revenue streams. About the only public infrastructure sector that doesn’t is the inland waterway system (see article below).

What DeGood and other P3 opponents want is an expansion of traditional design-bid-build infrastructure funding, with its built-in potential for cost over-runs, schedule delays, and low construction costs at the expense of high maintenance costs, resulting in wastefully high life-cycle costs. And of course, “highways to nowhere” that would never pass a benefit/cost requirement, let alone a realistic return on investment hurdle. Long-term P3 concessions address all those shortcomings of the status quo. That’s why I see the Trump proposal, via Ross and Navarro, as a breath of fresh air, despite its largely irrelevant call for federal tax credits.

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Questioning the Rush to Connected Vehicles

Few Americans are aware that the U.S. Department of Transportation is about to release a Vehicle-to-Infrastructure “guidance document” around the end of this year. It’s part of an ongoing effort in which the National Highway Traffic Safety Administration plans, soon, to issue a regulation requiring Vehicle-to-Vehicle communication capability in all new cars. V2V and V2I are part of the vision of Connected Vehicles and Smart Cities that we’ve all started hearing about in recent years. But discussion and concern about these ideas has started to migrate from transportation and urban planning wonks to the broader community, and I think we are in for some serious second thoughts.

There is a great deal of confusion in the popular media about “Connected and Autonomous Vehicles” (C/AV as I increasingly see in transportation media). Yet there is no necessary relation between the two. Most of the actual vehicle automation systems being developed do not depend on the vehicle being in communication either with other vehicles or with infrastructure such as traffic signals. There are potential safety benefits from such communications, but the claimed huge numbers of accidents avoided and lives saved are based on an eventual end state where the entire fleet (presumably including motorcycles, bikes, and possibly pedestrians) and nearly all traffic signals and other portions of roadway infrastructure are in communication. I’m still waiting for a serious benefit/cost analysis of all this (especially for the V2I part).

But the misconception that AVs must be connected has led to recent articles that portray AVs, per se, as likely threats to privacy or even security. San Francisco Chronicle business writer David Baker’s October 10th article, “How Self-Driving Cars Could Become Weapons of Terror” is a case in point. He assumes the C/AV model and then assumes that these vehicles would be “plugged into some kind of centralized traffic management system.” To illustrate the danger, he then quotes Mary Cummings of the Humans and Autonomy Lab at Duke University as pointing out that “the worst possible strategy would be to have a single, centralized control that would represent a single point of failure.” She tells Baker that we must “make sure that cars make their own decisions” about where to go, “like human drivers do.” I agree, and that’s what most AV developers appear to be doing.

More recently Aaron Renn at Urbanophile (November 21st) wrote a piece called “Will History Repeat Itself with Driverless Cars?” As a result of attending two recent conferences where AVs were a main topic of discussion, he came away convinced that “advocates of driverless cars explicitly see them as a distributed surveillance system. They envision real-time telemetry from the car being uploaded into the cloud, where it will be utilized by AI type algorithms. This is an extremely dangerous vision of the future, as the nefarious uses of this are obvious.” This strikes me as a bit over-the-top, but it’s easy to see how some of the Connected Vehicle and Smart City visions could be interpreted that way—or may even be intended that way by some.

I suggest caution on NHTSA proceeding with its V2V mandate, without serious discussion of its benefits and costs. If V2V is not essential to autonomous vehicles (except truck platooning, a near-term use that has industry support), then mandating it in all new cars—especially by mandating the potentially obsolete DSRC technology—could be costly and unwise. And on V2I, let’s see a serious benefit/cost analysis that is subjected to rigorous peer review, before we even think about any kind of mandate for that. At a time when a very large fraction of urban traffic signals do not even feature state-of-the-art timing systems, it’s a bit utopian to think that thousands of cash-strapped local governments are going to upgrade all kinds of roadside infrastructure to communicate with vehicles. How much would that cost, and over how many decades would it be implemented? Decades-off benefits need to be discounted to present value, not assumed to be real benefits soon after a V2I mandate appears.

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Mileage-Based User Fees and Rural America

Public opinion surveys continue to show that most Americans don’t see the need to switch from per-gallon fuel taxes to per-mile road-use charges. But even when they are given more specifics, one of their major concerns is equity—not so much rich/poor equity but urban/rural equity. The common belief is that rural residents have to drive longer distances than urban residents, and hence that shifting to per-mile charges would make them worse off.

That sounds plausible—until you look at the data, as two recent papers in Transportation Research Record No. 2597 do. (TRR is the peer-reviewed journal of the Transportation Research Board.) The first paper, by B. Starr McMullen, Yue Ke, and Haizhong Wang used statewide data from the Oregon Household Activity Survey to understand actual trip-making by urban and rural residents of that state. They then compared a hypothetical state mileage-based user fee of 1.5 cents/mile, equivalent in revenue generation to a 30 cents/gallon fuel tax. They found that under the proposed MBUF system, “households that lie within an MPO’s boundaries [i.e., urban] could expect to pay more on average than their non-MPO counterparts.”

The second paper used data from Washington State, analyzed by Mark Matteson, Noah Crocker, Lizbeth Martin-Mahar, and Carl See. They used data on that state’s vehicle fleet composition, annual VMT, vehicle fuel economy, and vehicle age to estimate the annual cost impact on various categories of driver if highway funding were changed from the current state fuel tax to a proposed revenue-neutral MBUF. Since the change was designed to be revenue-neutral, the overall difference was minimal. The distributional impact depended almost entirely on the fuel economy of the vehicles in question. Overall, on average rural drivers would save $4 per year and urban drivers would pay $2 per year more, because the latter on average drive more fuel-efficient vehicles. By vehicle type, drivers of passenger cars and station wagons would pay $27 more per year, while drivers of pickup trucks would pay $41 per year less. And since pickup trucks and older vehicles are more common in rural counties, that largely explains the overall results.

These results are consistent with several earlier studies on the urban/rural equity impacts of the proposed shift from per-gallon taxes to per-mile fees: rural residents would not pay more.

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Time for a New Paradigm for Crumbling Waterways

While much of the media and political rhetoric about America’s crumbling infrastructure is grossly exaggerated, the situation of the inland waterway system is genuinely dire. Tyler Kelley penned a long illustrative article in the New York Times November 23rd, “Choke Point of a Nation: the High Cost of an Aging River Lock.” It used the ancient and ailing Lock and Dam No. 52 on the Ohio River as a case in point. But Kelley’s detailed account does more than illustrate how bad the situation is. It also shows how a thoroughly politicized system—far worse than that of our highways, transit systems, or air traffic control—fails to deliver well-run, modern infrastructure that has an important role to play in goods movement.

Waterborne freight—primarily grain, coal, metals, and other bulk cargo—travels the inland waterway system in long barge tows. Because of changing elevation and seasonal changes in water flow, a system of dams (to keep channels deep enough) and locks (to lift boats and barge tows from one level to another) is required for there to be a waterway system. This is the infrastructure on which the barge industry operates, just as trains operate on tracks on rights-of-way and trucks operate on highways. By weight, per Kelley’s article, trucks move five times as much freight each year, and trains twice as much.

But there’s one crucial difference. Railroads pay 100% of the capital and operating costs of their infrastructure. Trucks pay a large share for the highway infrastructure they use (though highway cost allocation studies conclude that it’s not their full share). But barge operators, via a small fuel tax, end up paying about 8% of the capital and operating cost of the inland waterway system. You and I, as federal taxpayers, cover the rest. (Technically speaking, the Army Corps of Engineers, which runs the inland waterways, reportedly generates $2 billion in revenue from hydropower, navigation, and recreation at Corps public works projects, but that money disappears into the U.S. Treasury.)

Because there are always more claims on the federal budget than funds available, the waterways system is just one of thousands of straws in the giant margarita glass of the federal general fund. It always gets far less than it asks for when it comes time for Congress to actually appropriate funds. So we get massive problems like billions of dollars in deferred maintenance, an inability to issue revenue bonds (like airports, railroads, and electric utilities do) to finance major refurbishment and/or replacement of ancient locks, and a penny-wise/pound-foolish practice regarding barely functional locks of “fix as fails”—i.e., don’t spend money on preventive maintenance and timely repair and replacement; instead, wait for a major failure and then act.

Each year at the Transportation Research Board annual meeting, I try to make it to one or two sessions on better solutions for the inland waterway system. And each year, there is somewhat more talk of the need to try public-public-private partnership approaches. A growing number of stakeholders express interest, but the skunk at the party is generally the barge people. Why? Because you can’t do a real P3 project without a revenue stream, and the obvious revenue stream is tolls to use the locks. How radical are waterway tolls? Well, it’s what the Panama Canal and the Suez Canal use to finance their capital investments and operating & maintenance costs.

The Water Resources Reform & Development Act of 2014 (WRRDA) called for alternative approaches to funding and financing water resource public works, and discussions of possible waterway P3 pilot projects are continuing. In a September paper that is well worth reading, Patrick McGinnis of The Horinko Group suggests such a pilot project on the Illinois River. Taking a very modest approach to the funding structure, he suggests a $500 million project (over 10 years) for lock and dam upgrades in this corridor, with $110 million from the Inland Waterways Trust Fund (the recipient of the barge fuel taxes), $270 million in federal general funds, and the $120 million balance from some combination of user fees and cost savings.

I won’t hold my breath, but if Illinois River stakeholders could reach agreement on such a pilot project, it would be a worthwhile first step toward fixing a very dysfunctional status quo. McGinnis’s paper is at: http://www.thehorinkogroup.org/featured_column/2016/09/25/observations-on-us-waterways.

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Platooning and Dedicated Truck Lanes, by the Numbers

There is growing support for the idea that semi-automated and fully automated trucks are likely to require dedicated lanes on highways. This is partly because closely-spaced platoons of 18-wheelers could constitute a visual and physical barrier for cars getting on and off the Interstate. It’s also partly because Class 8 trucks, if anything, are likely to get bigger in future years, while cars are likely to get smaller, thanks to down-sizing to meet increasingly stringent fuel-economy requirements.

This got me to thinking about whether the advent of truck automation might change the economics of dedicated truck lanes (DTLs). Given projected growth in vehicle miles of travel (especially for trucks) as our population and economy continue growing over the next several decades, dedicated truck lanes will have to be additions to major highways, not conversions of existing lanes. And truck-only lanes can and should be built with more durable pavement to take the heavier loads. So that means they will cost a lot. The beneficiaries will be primarily the trucking companies that use them, though motorists will generally benefit as well if the big rigs are separated from them in barrier-separated dedicated lanes.

Part of the case for DTLs is that they would provide a safe corridor for longer combination vehicles—triple-trailer rigs and long doubles (twin 53 ft. trailers) that are currently legal only in some rural mountain states and on some eastern toll roads. There are significant productivity gains (ton-miles hauled per driver shift) and air-quality gains (ton-miles per pound of emissions) from LCVs, as the EPA has long recognized. But the advent of truck platooning adds new fuel-saving benefits to the case for DTLs.

Recent data from the Trucking Efficiency project (a joint effort of the North American Council for Freight Efficiency and Carbon War Room) found that a two-truck platoon with 40-50 ft. spacing yields 4% fuel savings for the lead truck and 10% for the following one, for a platoon average of 7%. A three-truck platoon should achieve 10% savings for both followers, averaging 8%. How much would that save the average truck in a platoon?

I used as an example a 200-mile rural Interstate corridor like that between Kansas City and St. Louis, where DTLs have been proposed for a reconstructed I-70. With Class 8 trucks averaging 6 mpg, a 200-mile trip today uses 33 gallons of diesel fuel. In a platoon getting 8% fuel savings, that would save 2.64 gallons. At the recent average price of diesel fuel, $2.48, the value of that fuel saving would be $6.55 for that one trip.

The four-state I-70 Corridors of the Future Study last decade concluded that the only conceivable way to pay for rebuilding I-70 with eight lanes (four of them DTLs) was to toll all lanes. In Reason Foundation’s Interstate 2.0 study from 2013, we estimated the truck toll for Missouri would be 8.3 cents/mi. For the 200-mile corridor, that would be a toll of $16.60, about 2.5 times the value of the fuel savings. So fuel savings alone are clearly not enough offset the cost of the toll.

But if DTLs already made good sense for an array of reasons, including benefits from the use of more-productive LCVs and significantly lower car-truck accidents and deaths, then adding fuel saving from platooning makes the case even stronger.

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Upcoming Transportation Conferences

Note: We don’t have the time or 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.

Transportation Research Board 2017 Annual Meeting. January 8-12, 2017, Walter Washington Convention Center, Washington, DC (Robert Poole and Baruch Feigenbaum speaking). Details at: www.trb.org/AnnualMeeting/AnnualMeeting.aspx

USC Real Estate Law & Business Forum, March 7, 2017, Jonathan Club, Los Angeles (Baruch Feigenbaum speaking). Details at: http://gould.usc.edu/why/academics/cle/realestate

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News Notes

VMT Still Increasing to Record Levels. The latest edition of FHWA’s monthly Traffic Volume Trends reported that Americans traveled 2.4 trillion vehicle miles in the first nine months of 2016, and 3.2 trillion VMT on a 12-month moving average basis. It looks as if 2016 will see an all-time high in VMT. Growth was highest in the west, increasing 5.5% in that 13-state region in September.

California Toll Lanes Project Breaks New Ground. A $1.2 billion project to provide two express toll lanes each way on a highly congested stretch of I-405 in Orange County, CA was approved last month by the board of the Orange County Transportation Authority, voting 14-0. The project is the first awarded under AB 401 which finally permits design-build contracts (fought for decades by the Caltrans engineers’ union) and also the first to make use of new tolling authority via AB 194, which ensures that any excess toll revenues will be used to fund transportation improvements in the same corridor. The Environmental Impact Report estimated that the no-build option would lead to peak-period travel time of 2 hours, 13 minutes in the GP lanes and 2 hours in the carpool lanes by 2040. With the project as approved, those times are now projected as 29 minutes in the GP lanes and 13 minutes in the express toll lanes.

Detroit-Windsor Toll Bridge RFP Finally Released. The Windsor-Detroit Bridge Authority last month released the long-awaited Request for Proposals for the $2.1 billion Gordie Howe Bridge across the Detroit River. The project includes constructing the 1.5-mile bridge, U.S. and Canadian ports of entry, customs plazas, and a connection to I-75 in Detroit.

NATSO Urges FHWA to Prevent Rest-Area Recharging Stations. The trade group representing truck stops and exit-ramp gas stations in late October met with FHWA officials in response to the agency’s Sept. 27th request for comments on whether it should allow new forms of rest area commercial sales—such as electric vehicle recharging and alternative fuel services. Their argument was purely a defense of the status quo, in which commercial services other than vending machines are banned at Interstate highway rest areas, requiring motorists and truckers to leave the Interstate to obtain any and all such service from NATSO member companies.

Louisiana Panel Supports Tolls and P3s for Transportation Investment. The Governor’s Task Force on Transportation Infrastructure Investment, appointed by Gov. John Bel Edwards, last month issued two recommendations to help the state make major transportation improvements, including a new $1 billion bridge across the Mississippi at Baton Rouge. The first was public-private partnerships, as a better way to procure and manage large-scale projects. The second was tolling, as a bondable revenue stream for such projects. The governor is expected to make transportation a key issue in the 2017 legislative session.

Arkansas and Illinois Considering Express Toll Lanes. Two more states are likely to join the ranks of those adding express toll lanes to their freeway systems in 2017. Illinois is already in procurement for a P3 project to add such lanes to the Stevenson Expressway (I-55) and is now considering a similar project for the Eisenhower Expressway (I-290), both in the Chicago metro area. And Arkansas DOT and MPO Metroplan are studying possible conversion of HOV lanes to express toll lanes in the Little Rock metro area. Meanwhile, in what would be a first for such projects, the toll lanes added to the Cesar Chavez Expressway in El Paso seem likely to be de-tolled, since the single lane each way is attracting fewer than 2,000 trips per day.

Online Shopping Boosts Truck Trips. Those who expect that truck VMT will stop growing seem to be ignoring the unprecedented growth in online shopping. It’s growing fast in most developed countries, especially Britain, the United States, and Germany. The Economist‘s detailed article on the trend (Nov. 19, 2016) noted that first-place Britain, where nearly 17% of retail trade took place online in 2016, experienced 4% growth in truck VMT this year, versus just 1% overall VMT growth—and there is now a shortage of 45,000 truck drivers. MPOs and state DOTs fail to factor in this phenomenon at their peril.

U.K. Government Won’t De-Toll M6. In a rebuff to populists, the U.K. Department for Transport announced that it has no intention of buying the M6 toll road, the concession for which is on the market. Some local politicos proposed the acquisition, hoping that under government ownership the tolls could be removed. It would cost DfT over $1 billion to acquire the 27-mile toll road, money that would be far more productive if spent on new highway capacity in under-served Britain.

Huge Turkish Tunnel About to Open. The $1.25 billion Eurasia Tunnel beneath the Bosporus Strait in Istanbul is due to open to traffic by year-end, nearly a year ahead of the original schedule. The double-deck tunnel, sized for cars and mini-buses only, has been developed under a 29-year toll concession by an international team. The project won a 2016 Global Best Project Award in the category of bridges and tunnels from Engineering News-Record magazine.

Northwest Parkway Concession Sold. The troubled Northwest Parkway forms a portion of the beltway around metro Denver. Originally developed by a nonprofit local agency, it had trouble covering its debt service and was rescued by Portuguese toll road company Brisa under a 99-year concession agreement in 2007. Earlier this year, Brisa decided to move on and put the remainder of the concession up for sale. Eleven consortia bid, seeing long-term value in the project despite its early-years difficulties. The winner was announced early this month: a consortium of infrastructure investment funds, comprising HICL (U.K.), DIF (Netherlands), and Northleaf Capital Partners (Canada). They bid $500 million for the concession, somewhat less than what Brisa had paid originally ($603 million).

Transit Performance Comparison Online. Boston-based think tank Pioneer Institute has unveiled MBTAanalysis.com, an online data tool that enables policymakers to compare the performance of large transit agencies around the country. The data are obtained from the National Transit Database. Pioneer has an ongoing program aimed at major reforms in the Massachusetts Bay Transportation Authority (MBTA).

Australia MBUF Study Under Way. On November 24th the national government of Australia announced that as part of its 15-year infrastructure planning effort, it will conduct a study of the potential benefits and impacts of implementing a road user charge for light vehicles. The government has already committed to introducing such a charge for heavy vehicles. The proposed charges would replace current highway user taxes, primarily fuel taxes and vehicle registration fees, but is not intended to replace tolls on existing and future highways.

Decline in U.S. Car-Sharing? Economist David Levinson of the University of Minnesota has an interesting piece on his Transportist blog called “Car2Gone: On the Decline of Carsharing in the Late 2010s.” Though triggered by the closure of Car2Go in the Twin Cities, back in 2013 Levinson had predicted that “carsharing is the mode of the future and always will be.” His reasoning is that this is a network-effects business that depends on low access costs, which he thinks were not low enough to generate such effects in the Twin Cities or several others where Car2Go has ceased operating (including Miami and San Diego).

Another Caution on Near-Term Driverless Cars. In “Your Driverless Ride Is Arriving,” MIT Technology Review writer Will Knight provides a first-hand assessment of Uber’s recent demonstrations of prototype robo-taxis in Pittsburgh—and concludes that “[fully] autonomous vehicles aren’t anywhere near being ready for the roads.” The article appears in the magazine’s November/December issue.

Moody’s Is Bullish on Toll Roads. In a November 30th Outlook for 2017, Moody’s Investors Service says the outlook for the U.S. toll roads industry is positive. This year’s growth in traffic and revenue on the 48 toll roads that it rates exceeded analysts’ expectations and is likely to continue strong in 2017. Their report also notes that “We expect inflation-indexed toll increases to proliferate as electronic toll collection becomes the norm,” illustrating that keeping highway revenues in step with inflation is being addressed in the toll roads sector more successfully than in the gas-tax highway sector.

Electric Car Sales Still Miniscule. Data presented in a November 14th Wall Street Journal article show that for the first half of 2016 electric vehicles comprised only 0.7% of global vehicle sales, though their actual volume was significantly higher in 2016’s first half than in the comparable period of 2015. Most major auto companies have new EVs under development, and General Motors is hoping for large sales of its new all-electric Bolt vehicle, priced at $35,000.

AAA Loses Suit Over Port Authority Toll Increases. A federal judge on November 18th dismissed a long-running lawsuit brought by AAA Northeast against the Port Authority of New York & New Jersey. AAA argued that large recent toll increases provided no benefits to those who paid the tolls, since the agency’s bridges and tunnels were already generating surplus toll revenues, and that spending the surplus on rebuilding the World Trade Center and the non-PA Pulaski Skyway in New Jersey violated the interstate commerce clause of the Constitution. The judge ruled that AAA had not proved that the surplus revenue would be spent on the World Trade Center or that the toll increases were excessive relative to potential benefits such as safer roads or reduced congestion. So the PA’s use of its toll facilities as cash cows continues.

Poole Interview on Trump Infrastructure. Reason.com Editor Nick Gillespie interviewed me last month on the probable Trump Administration infrastructure agenda. The relatively short interview is available on YouTube and also at http://reason.com/reasonTV/2016/11/22/donald-trump-transportation-plan.

Correction re Atlanta Toll Lanes. Elmer Stancil of Georgia’s State Road & Tollway Authority emailed after last month’s issue to note that while the extension of the I-85 express toll lanes is one lane each way, their other two ongoing projects are mostly two-lane reversible facilities, on I-75 South and the Northwest Corridor project on I-75 North. Details of all there projects are available on the Georgia DOT website.

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Quotable Quotes

“Funding infrastructure with general tax revenues removes the discipline that comes when projects need to pay for themselves. If every new road or rail project had to fund itself, the projects that deliver the greatest benefits would be the ones that move ahead. If people are willing to pay to use infrastructure, we can assume that the infrastructure provides social value. A user-fee approach is also fairer. With general tax financing, every American must pay for new highways in Montana, regardless of whether they drive or have ever been to Montana. It’s much fairer for the people who use roads to pay for roads.”
—Edward L. Glaeser, “If You Build It . . . Myths and Realities About America’s Infrastructure Spending,” City Journal, Summer 2016

“The ideal [AV] scenario that I talked about, saving the tens of thousands of lives a year, assumes complete automation with no human engagement whatsoever. I’m not confident that we will ever reach that point. I don’t see the ideal of complete automation coming any time soon. Some people just like to drive. [And] there’s no software designer in the world that’s ever going to be smart enough to anticipate all the potential circumstances this software is going to encounter. The challenge is that when you have not-so-complete automation, with still significant human engagement, complacency becomes an issue. That’s when lack of skills becomes the issue. So our challenge is: how do we handle what is probably going to be a long-term scenario of still some human engagement in this largely automated system?”
—Christopher Hart, National Transportation Safety Board, “Policing Driverless Cars,” MIT Technology Review, November-December 2016

“The mobility-as-a-service concept envisions a far more substantial role for either the private sector and/or a government agency to be the dominant provider of mobility vs. self-reliance on oneself or one’s household as the dominant supplier of mobility (vehicle ownership) in the current model. Some share of the public will be resistant to a greater dependency on either government or the private sector, perhaps a monopoly, as their source of mobility. This will create fear and distrust among some and raise questions such as how quickly service will be available in emergency conditions, who will get available vehicles when it is time to evacuate for an emergency, how can one be assured that there will not be abusive pricing when monopoly conditions exist, will someone be denied services if they are behind in payment, will the service provider reveal travel information to other parties, etc. The pace and magnitude of transition to a culture of shared mobility, or mobility as a service, will be influenced by how travelers perceive and respond to these conditions, as well as technology, economic, and policy considerations.”
—Steven E. Polzin, “Implications to Public Transportation of Emerging Technologies, National Center for Transit Research, November 2016 (www.nctr.usf.edu/2016/11/implications-to-public-transportation-of-emerging-technologies)

“As previously stated, 92% of the total cost of the inland waterway system is currently borne by U.S. taxpayers, while waterway users, via a fuel tax and trust fund, account for only 8%. This has left a resource gap in what’s needed and what’s practically available that P3s, cost containment, revenue capture, and better accounting and use of Treasury revenue need to close. A larger burden of risk and responsibility must also be transferred from taxpayer to user. Most of all, we need to find the will to test old assumptions regarding project delivery, and select for efficiency and economy of effort to better serve public interests and the serviceability of our nation’s inland waterways. We cannot simply throw money at the problem. The world has become more transparent, and a populist electorate simply won’t support it.”
—Patrick McGinnis, “Observations on U.S. Waterway Modernization: Making the Case and Demonstrating the Way Forward,” The Horinko Group, Sept. 25, 2016

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Robert Poole is director of transportation policy and Searle Freedom Trust Transportation Fellow at Reason Foundation.