Idaho Transportation Issues

David T. Hartgen, Ph.D., P.E.

Emeritus Professor of Transportation Studies

UNC CharlottePresident, The Hartgen Group

Remarks to the

Governor’s Task Force on Modernizing

Transportation FundingBoise, IdahoJuly 27, 2010

Topics

•Economic Impact of Highways•Funding Options Study•“Bending the Cost Curve” •Congestion and Air Quality

Economic Impacts of Highways: Two Views

“User Benefits” • Travel time

savings• Operating costs• Accidents• Reliability

“Jobs” • Direct (construction)• Indirect (const

support)• Induced (local

economy)

Findings from the Literature

User Benefits• Travel time 50-70%• Reliability 20-40%• Operating costs 5-10%• Accidents 5-10%• Largest for congestion

relief• Lowest for pavement and

bridge work

Jobs • High-level studies• Impact depends on local

economy and ‘leakage’.• Historical : 30-40

jobs/$ m, 2/3 direct• Recent: 5-20 jobs/$ m • Highest: Widenings in

mid-sized areas• Lowest: pavement

work in rural areas

Benefits from Projects (Continued) • ARRA (‘Stimulus’) reports (construction only) • T-PICS Tool for specific projects

• Be Cautious: – Resist tendency to over-state construction benefits– Many local unknowns– Focus on mobility improvements over time

Study of State Funding Options

• Reason Foundation• Focuses on STATES, not feds.• Near-term options, 1-5 years • Consider growth, revenues,

impacts • 1-page summaries of states/state

groups • Oct 2010 (for 2011 Legis. Sessions)

Idaho Highway Program Trends

Revenues Disbursements

Breakdown of Revenues, Idaho

0100

200300

400500

600700

2000 2004 2008

Year

Reven

ues ($

million

)

Funds from Local Governments

Other Federal Agency Funds

FHWA Funds

Bonds for Capital Outlay

Miscellaneous

Vehicle Taxes

Fuel taxes

Breakdown of Disbursements, Idaho

0

100

200

300

400

500

600

700

2000 2004 2008

Year

Disbu

rseme

nts ($

million

)

Bond Retirement

Highway Law Enforcement andSafety

Administration, Research, andPlanning

Maintenance and HighwayServices

Capital Outlay for Roads andBridges

National Ratings (Reason Foundation) •Funds

increased•Rural Int. % Poor worsened slightly.

•I-84 work will improve ratings

National Ranking Trends

8

17

159

1317212529333741

MT WY OR NV ID UT WA

Natio

nal R

ankin

g

2004

2008

Idaho Road Condition Trends

Interstate System Lower SystemsIdaho Interstate

-50

100150200250300350400450

International Roughness Index (IRI)

Mile

s

200020042008

GOOD FAIR POOR

Idaho Other Roads Condition*

-

200

400

600

800

1,000

1,200

1,400

1,600

1,800

International Roughness Index (IRI)

Mile

s

2000

2004

2008

* IRI- scored

GOOD FAIR POOR

Idaho Highway Program Trends

Highway Revenue and Disbursement Trends, Idaho

$91 M$178 M

$258 M

0.0

200.0

400.0

600.0

800.0

1000.0

1200.0

2000 2002 2004 2006 2008 2010 2012 2014 2016 2018

Year

Rev

enue

s and

Disb

urse

men

ts ($

m

illio

n)

Disbursements, 8%/yr

Revenues, 3%/yr80% Increase 00-08

What are States Considering??

State Legislative Actions 2008-10

263 Actions

94

86

83

Approved

Considered

Rejected

What ‘s Been Approved? States

Doing? TOP 6:

•Bonds

•Fuel Taxes

•PPPs

•Vehicle Reg. Fees

•Tolls

•Re-Direct Funds to/from Highways

No Approvals of

•VMT fees

•Congestion pricing

•Carbon taxes

State APPROVED Actions, 2008-10

0 5 10 15 20 25

Road Pricing Cong Tolls

Cordon Pricing

State Gen Sales Tx

TIF Bonds

FedTrust Fund Appt

Fed Earmarks

Stimulus

Fuel Sales Tax

Veh Sales Tax

License Fees

State Gen Fund

Tourism

Misc

Re-direct Funds to Hwys

Tolls

Veh Registr Fees

PPPs

Fuel Taxes

Bonds (Rev, Garvee, etc)

Count

Fuel Taxes and Registration Fees

Fuel Gallon-Sales Taxes

• Cents Per Gallon: ID: $ 8.7 M for 1 cent/gal

Easy to administer

19 states since 2008 (NV 2.05 c/g, OR 6 c/g contingent)

Politically challenging

Limited revenue at low rates

• Sales Percent ID: $ 6.2 M for 0.25 cent/$.

2 states since 2008 (IN, NE)

Limited revenue at low rates

Vehicle Registration Fee

• ID : $ 10 m $ 5/10/25 add-on) (Trucks $0.4 m)

• Easy to administer• BUT:

– Limited revenue at low rates

– Visibility

VMT (Mileage) Taxes and Tolls

• VMT Tax • ID: $ 27 M annually (1/4 cent/mi, 70%)• Grows with travel, ‘odometer ‘ feasible

now• BUT: Replace or add to fuel tax?

• Administration? • Privacy issues?

• Interstate Tolling• ID: $ 42 M annually at 1 c/m cars, 4 c/m

trucks. • Relatively easy to administer• Significant recent interest by States • BUT : Restrain trade? Local travel ? Fair?

Bonds and PPPsBonds, etc • Traditional

– Revenue– General

• Garvee bonds– Revenue stream? – Federal fund backing– Effect on Future

program?

• BABs, PABs• TIFIA

– Loan guarantees/credit– Primarily large projects

Private-Public-Partnerships

• 40-50 Nationwide– Design-Build (5 recent) – Design-Build-Finance(1) – Enabling Legis ation( 6) – Tolls-pricing (2) – Maintenance (1)

• BUT: – Revenue or ‘shadow

toll’? – Mostly > $ 100 m– Limited applicability – Advisability?

Re-Direct Funds to/from Highways• 5 Recent Actions

1. AL: $ 100 m from State Trust Fund to hys.

2. CA: $ 950 m bonding from State to local roads.

3. LA: Veh Sales tax $ from GF to transp. Fund.

4. MO : Reduces veh/lic. Fee by $ 28 m. 5. ID: $ 20 m from SP/P&R to Hy

Fund (delayed to 2011)

Stimulus and Federal ActionsStimulus• $ 26.7 B nationwide• ID $ 179 m, 16 projects

• ID: 2838 ‘job-years’ impact, mostly construction.

• Repeat ???

Federal Actions • 3 FTF infusions ~ $

35B• Reauthorization ‘on

hold’ pending ‘vision’ , Nov. election,?? ,

• Delay to post 2012 ???• ‘Earmarks’ declining • Formula changes ?? • Carbon tax ??• Tolling the

Interstate ??

ID "Stimulus' Hy Funds vs. 2008 Disbursements

$ 635

$ 179 m

0

100

200

300

400

500

600

700

2009-2010 ARRA Highway 2008 Disbursements

$ m

illio

n

28 %

Summary for Revenue Actions

Revenue Options• Continue prudent

stance• Slow /reduce future

bonding• Review fuel and

registr. tax structure• Study Interstate tolls• Delay VMT–Pricing

Other Options • Consider State infrastructure bank to help locals

• Explore PPPs (design-build, non-revenue, etc)

“Bending the Cost Curve”

Project selection• Long-term “vision’ and

goals /track status • Select major projects by

‘benefit ’ vs. ‘cost’ • Focus on early

maintenance, ‘fair’ cond.

• Allocate funds by need. Set District goals, select projects to meet goals (Montana)

Bids-Contracts• Consider bid-bundling

(Missouri) • Consider contracting

some maintenance functions. (VA, ALB)

• Explore PPP options.– ‘Design-build’ variants– Contractor

participation

Congestion and Air Quality

Congestion • Boise region

– Congestion ‘modest’– Plan has a modest deficit in

congestion relief. – Intersection-arterial focus– $ 350-$400 M over 20 yrs

• Other regions– Generally ‘mild’ congestion– Intersection focus– $ 50-100 m over 20 years

Air Quality • VOC and NOx

– Sharp improvement– vehicle efficiency

• PM10/2.5 worsening• Transp. plans have

minor impact• CO2: Likely

increase– Signal timing– Tele-commuting