In this issue:

• Experts spar over induced demand and freeway expansion
• Analysis, not knee-jerk reactions for Ohio train derailment
• Which state DOTs plan to fix major truck bottlenecks?
• TRB report on Black Americans and transportation
• Hyperloop startups losing ground
• How is Denver doing on Vision Zero?
• News Notes
• Quotable Quotes

Experts Spar Over Induced Demand and Urban Freeway Expansion  

I-35 through downtown Austin is massively congested much of the day. That’s hardly surprising since both Austin and Texas have been growing by leaps and bounds for several decades (with no end in sight), while I-35 through central Austin still has not had a significant expansion since 1974. Trying to accommodate today’s traffic flow with the capacity of 50 years ago is like trying to put 10 pounds of potatoes into a 5-pound sack.

Yet opponents of expanding I-35 in Austin raise the concept of “induced demand,” which some refer to as the “iron law of freeway congestion.” The idea is that it’s pointless to add capacity because the improved traffic flow will (only) lead to more vehicles choosing to use the freeway, yielding renewed congestion.

One of those who raised this argument is professor and engineer Kara Kockelman, who teaches transportation engineering at the University of Texas at Austin. In a recent piece by Kelsey Thompson of KXAN, Kockelman said that roadway improvements can lead to people changing their behavior, such as living further out in the suburbs or making trips during peak periods that they used to make at off-peak times. “By opening up I-35,” she told KXAN, “what we do is increase the attractiveness of that corridor for longer distance travel.” Also, after a long construction period, “There’ll be a lot of pent-up demand just waiting to get onto that road when it fully opens,” Kockelman added. That’s all true, but it’s not the end of the story.

At about the same time, another transportation expert, Steven Polzin of Arizona State University, published an article on Planetizen, “Induced Travel Demand Induces Media Attention.” He points out that in fast-growing states, most new highway demand comes from population growth and new jobs, not from “induced” travel. Second, he notes that vehicle miles traveled (VMT) per capita have leveled off in the past decade, so traffic congestion will likely not grow as fast in coming decades, other things equal. Third, Polzin points out that trips accommodated by an expanded highway can provide a number of benefits, such as:

• Residents getting access to better jobs and businesses with better selections and lower prices;
• Businesses having access to a larger labor pool, and larger customer and supplier bases;
• Enabling emergency vehicles getting where they are needed faster;
• Pulling cut-through traffic out of neighborhoods; and,
• Enabling parents to get home in time for family meals and activities.

Some of those benefits might not be long-lasting, especially as places like Austin continue to grow. But neither expert mentioned a way to make the expansion benefits last longer: add market-priced lanes instead of free lanes, so the pricing will enable high-value trips to take place even during peaks when the free lanes are getting jammed. Those can be personal trips (to the airport to catch a plane, getting to day-care in time to avoid late fees), enabling express buses to run consistently faster and more reliably, and letting emergency vehicles get where they’re needed quickly, for example. Kockelman mentions toll roads but not express toll lanes. In Houston and especially Dallas/Ft. Worth, the express toll lanes are popular and much-used. But even there, where they have proven their usefulness and popularity, regional plans for a whole network of express toll lanes have been thwarted by the Texas state legislature, which has banned any new Texas Department of Transportation (TxDOT) support for tolled projects, and any new long-term public-private partnerships (P3s) financed by toll revenues.

TxDOT’s earlier concepts for I-35 in Austin called for adding express toll lanes (also known as priced managed lanes). But as I noted in the August 2022 issue of this newsletter, due to the legislative ban, TxDOT’s current plan is to spend $4.9 billion of taxpayers money to add “non-priced managed lanes” to I-35 in Austin. In plain language, that means old-fashioned, ineffective high-occupancy vehicle (HOV) lanes. Based on past history, if built, those lanes will likely be either too empty (wasting costly pavement) or too full (fam-pools, cheaters). Without pricing, there is no “management” of HOV lanes.

In a recent presentation in Ft. Worth, I pointed out that TxDOT’s current plans to add HOV lanes to I-35 in Austin, I-35 in San Antonio, and I-635E in Dallas total $8.1 billion. On average, revenue-financed highway projects like express toll lanes need only 20% from the state DOT with all the rest financed based on toll revenues. Were those three projects carried out via revenue-financed P3s, TxDOT would save 80% of that $8.1 billion to spend on other projects statewide. That ought to appeal to legislators from smaller cities and rural areas. And it would produce a much more effective and long-term solution for the antiquated I-35 through Austin.

» return to top

Analysis, Not Knee-Jerk Regulation, for the Ohio Train Derailment
By Marc Scribner

On Feb. 3, a 149-car freight train operated by Norfolk Southern derailed in East Palestine, Ohio. Legitimate concerns regarding its hazardous material cargo and the potential impact on the local community soon morphed into a highly politicized and incoherent public debate on rail safety. Without knowing the causes of the derailment, it is premature to suggest any policies to prevent similar accidents from taking place in the future.

Of the 38 cars that left the track in East Palestine, 11 were tank cars carrying hazardous materials. These cars then caught fire and ignited an additional 12 cars that had not derailed. The train crew was able to decouple the lead locomotives from the train and flee a mile east while emergency responders began fighting the fires and instituted a one-mile radius evacuation zone surrounding the site.

By Feb. 5, emergency response personnel had extinguished the fires but noticed the temperature was still rising in a tank car carrying more than 115,000 gallons of toxic vinyl chloride, indicating a chemical reaction was taking place that could cause an explosion. This led to an expansion of the evacuation zone to a two-mile radius, after which emergency responders manually emptied five tank cars carrying vinyl chloride into containment ditches, where it was then burned. There have been no reported injuries or fatalities, although regulators are still investigating environmental and health hazards that may be present.

In the weeks following the accident, mainstream media outlets took an unusually heightened interest. This was accompanied by an outpouring of demagoguery and conspiracy theories from numerous politicians, pundits, and activists. The National Transportation Safety Board (NTSB) is still investigating the causes of this accident, but its preliminary report published on Feb. 23 suggests an overheated wheel bearing failed immediately prior to the derailment.

The NTSB’s clear early reporting on the known facts has helped quell some of the misinformation firestorm, but false and misleading claims about the accident are still being circulated and continue to drive the debate on potential policy responses. Policymakers should proceed with caution and develop an understanding of the particular facts of this accident and the relevance of various regulatory proposals before acting.

The suggestion that the Trump administration’s rescission of Obama-era requirements on electronically controlled pneumatic (ECP) brakes is a potential cause of the derailment is false on its face. That 2015 rule was criticized by rail carriers for having costs that exceeded the benefits. In the FAST Act, the 2015 multiyear surface transportation reauthorization, Congress included provisions at Section 7311 that ordered studies on ECP brakes from the Government Accountability Office and the National Academy of Sciences. Congress also required the secretary of transportation to reanalyze the benefits and costs of the rule based on this revised expert input and to repeal the ECP brake requirements if it was determined that the costs exceeded the benefits. Consistent with the law, the Department of Transportation (DOT) rescinded the ECP brake requirements in 2018 following the updated benefit-cost analysis.

But most important to the East Palestine derailment is that even if the ECP brake rule had withstood congressionally ordered scrutiny, it would not have applied to this train. That is because the Norfolk Southern train did not consist of enough hazardous materials railcars to trigger those repealed requirements. The false claims about the ECP brake rule led NTSB Chair Jennifer Homendy to take to social media to correct the record a week before the release of NTSB’s preliminary report.

In another social media spectacle, Transportation Secretary Pete Buttigieg and Sen. Marco Rubio (R-FL) got into a heated argument about automated track inspection (ATI) technologies that also are irrelevant to the East Palestine accident. Sec. Buttigieg implied that Sen. Rubio’s past support for ATI ran counter to rail safety. This is untrue. As I’ve written at length, regulators themselves have found that ATI provides safety benefits over traditional human visual inspections. The issue is that the Federal Railroad Administration during the Biden administration has been shutting down successful ATI pilot programs and denying waivers requested to expand the use of ATI, apparently at the request of unions representing track inspectors. In this case, Sen. Rubio was right to criticize the Biden Department of Transportation for adopting less-safe rail policy.

But Sen. Rubio has also offered up red herrings following this accident. He most recently joined a bipartisan group of populist senators to introduce the Railway Safety Act of 2023, which closely mirrors the regulatory demands made by Sec. Buttigieg prior to the release of the NTSB’s preliminary report. President Biden quickly endorsed the bill. Among the bill’s provisions is a requirement that trains have at least two crewmembers on board, a longstanding priority of organized labor that fears emerging automation technologies. The Department of Transportation is currently pursuing this rule on its own and has admitted that it does not possess “any meaningful data” to support the conclusion that two-person train crews are safer or that one-person crews are less safe (see Reason Foundation’s response to this proposed rule). What’s more, the Norfolk Southern train had three crewmembers in the locomotive cab at the time of derailment and there is no indication that the crew played any part in the accident.

There may be an appropriate role for policymakers once the causes of the East Palestine accident are determined. However, it is important to recognize that rail accident rates are at or near historic lows across all incident types, according to Federal Railroad Administration data. Further, statistics from the Pipeline and Hazardous Materials Safety Administration show that rail is far safer than trucks in transporting hazardous materials, meaning that rail-specific hazardous materials regulations should be balanced against the safety implications of a potential modal shift to trucks likely to occur if rail transportation costs rise. While especially challenging in a polarized and hot-tempered political environment, responsible policymaking will require careful analysis, not reflexive regulation.

» return to top

Which State DOTs Plan to Fix Major Truck Bottlenecks?

Ever since 2002, trucking research organization the American Transportation Research Institute (ATRI) has been using truck GPS data to identify the top hundred truck bottlenecks across the 48 contiguous states. Its latest annual report was released last month and is available here.

In most prior years, when I have written about this annual survey, I’ve reported little change from year to year: the same bottlenecks keep appearing, in pretty much the same order of awfulness (e.g., Fort Lee, NJ, where I-95 intersects with SR 4 is nearly always #1). But this year, there is actually some good news. Transportation departments in several states have included fixing a number of these chronic bottlenecks in their current plans.

I had time to review only the top 20 bottlenecks, those with the worst chronic traffic congestion. And the winning DOT is Georgia’s. Its current plans are to reconstruct and modernize all of nine of its ATRI  bottlenecks, all in the Atlanta metro area and most of them involving I-285, the Atlanta ring road known locally as “the Perimeter.”  Georgia’s six major bottlenecks in the top 20 to be rebuilt are as follows:

Texas has four bottlenecks in the top 20:

TxDOT tells me that all four are in its 10-year Unified Transportation Program.

Fast-growing Nashville has one of the top 10 bottlenecks: I-24/I-40 at I-440 East. It will likely be addressed in the state’s forthcoming public-private partnership and choice-lanes legislation, but that legislation has not yet cleared the Tennessee legislature.

Cincinnati has the #15 bottleneck, where I-71 and I-75 come together to cross the Ohio River. That bottleneck will be addressed by the $3.2 billion Brent Spence Bridge project, which will improve the existing bridge and reserve it for local travel and build a new double-deck bridge parallel to the existing one to accommodate both I-71 and I-75. That project has won $1.6 billion in federal grants, to be supplemented by Ohio and Kentucky state transportation funding.

Louisiana made #20 on the list, with the notorious bottleneck where I-10 and I-110 intersect in Baton Rouge, near the I-10 bridge across the Mississippi River. Louisiana Department of Transportation and Development (DOTD) has an ongoing contract for the reconstruction and widening of this segment of I-10. In addition, DOTD is in the planning stage for an additional bridge across the Mississippi, which should also improve traffic flow in the Baton Rouge area. Last fall, a planning study narrowed the locations for the Mississippi River Bridge South project to just three.

California has three of the top 20 bottlenecks, all in the greater Los Angeles area. My three Caltrans contacts confirmed that one of the three—SR 60 at SR 57—will begin reconstruction this spring. But there are no plans within the next 10 years to deal with the other two.

The Chicago area has three bottleneck interchanges in the top 20, but thus far, I have not identified any projects that would directly address any of them.

This is the most positive assessment I’ve made of the annual ATRI report, with serious plans to address more than half of the top 20 bottlenecks. Kudos to the DOTs of Georgia, Louisiana, Ohio, Tennessee, and Texas for taking these bottlenecks seriously.

» return to top

TRB Report on Black Americans and Transportation
By Baruch Feigenbaum

In order to better understand transportation’s effects on black Americans, the Transportation Research Board (TRB) Transit Cooperative Research Program (TCRP) is in the process of producing a five-volume study on racial equity. The full title is Racial Equity, Black America, and Public Transportation. The first volume was released in early January.

What is TCRP, and how does the process work? TRB committee members write problem statements for further research and submit them to TCRP staff. The staff meets to select which problem statements should get funded for research, with a focus on statements that are timely and innovative. Once a statement is selected, TRB staff forms an oversight committee of TRB committee members. The oversight committee fine-tunes the topic parameters, issues a request for proposals from contractors, and then selects the winning contractor team based on qualifications.

The first chapter of volume one explains the report’s purpose of understanding how transportation impacts affect black people by linking transportation and the civil rights movement. The second chapter describes the research approach, which sorts government policies into different categories, such as land use. The third chapter discusses economic policies, including housing and transportation, white flight, and spatial mismatch. The fourth chapter discusses health impacts, including air pollution impacts and pandemic policies. The fifth chapter examines social causes, including gentrification and policing. And the sixth chapter includes potential solutions, including changing metropolitan planning organizations’ (MPO) policies.

The report details some clearly racist policies. In chapter 3, section 3, the authors note that often urban Interstates were routed through black communities even when it was not the shortest route. These routings were designed to place a barrier between the central business district and the community. For example, in Atlanta, I-75/I-85 was built in a semi-circle instead of a straight line to separate downtown from the Old Fourth Ward. This occurred even though a straight line would have been cheaper and safer.

In chapter 3, section 4, the authors note how cities such as Denver have prioritized rail construction for a limited number of white constituents while providing insufficient bus service to a larger number of bus riders. The authors also note how most post-World War II heavy rail systems served to move upper-middle-class white residents from the suburbs to downtown, demolishing parts of places like West Oakland, CA, in the process. The authors also note the role of the Bus Riders Union, which successfully sued the Los Angeles County transit provider to force the agency to increase bus service instead of building rail lines. (Unfortunately, once the court-ordered consent decree expired, the transit provider returned to its past ways). In chapter 5, the authors note how bike lanes and light rail can raise property values, forcing out black residents. This occurred in Seattle due to new light rail stations and in Fresno due to a new mixed-use infrastructure project.

But sometimes the report strays from transportation. While some of this research is useful, I question what it is doing in a transportation publication. For example, the report has an entire section on housing discrimination. It details how both the former Home Owners Loan Corporation and the Federal Housing Administration had loan programs that discriminated against black homeowners. Only $120 billion, or two percent of program funds, were disbursed to African Americans. The report also includes an entire chapter on health. The report details the siting of hazardous landfills in North Carolina and Texas, neither of which are related to transportation.

In its conclusions, the report highlights how MPOs need to do a better job of representing all interest groups, not just white business interests, as well as how some transportation ballot measures which did not include projects important to black residents failed. But it does not offer a solution for either. Some of the report’s implied solutions could make the outcomes worse. For example, demolishing Interstate highway segments would likely lead to gentrification displacing black residents. It is far from ideal to live adjacent to a highway and have to deal with increased noise and tailpipe emissions. But it is better than losing your house because you cannot afford to pay the property taxes.

There are also some statements that seem to counter the report’s goals. In one section, the authors note that whites have much shorter travel times to work despite commuting longer distances. The study asserts that the reason is automobile ownership, and if blacks had owned automobiles at higher rates, then travel times would have been the same. If that’s true, maybe the policy should be to subsidize vehicle purchases instead of transit systems, as some transportation economists have recommended.

Finally, I’ll be curious to see the full policy recommendations in volume 3. The report details a 500-year-plus history of racist policies and suggests that government actors are still racist. If the government is so bad, why not look to the private sector or non-profit actors to solve the problem?

Comedian Dave Barry told a joke about how driver #1 got a flat tire because driver #2 intentionally threw a bunch of nails on the road in front of driver #1’s vehicle. Yet driver #1 went to driver #2 to repair his tires. If the government caused these problems, the authors need to make sure their recommendations don’t rely on the people who created the problems to solve them.

» return to top

Hyperloop Startups Losing Ground

Ten years ago, Elon Musk introduced a ‘new’ concept that I’d studied in a mechanical engineering course at Massachusetts Institute of Technology in the 1960s: Build evacuated tubes with capsules powered by linear induction motors for truly high-speed surface transportation. We fledgling engineers were excited by the concept, but we had no real idea of how to estimate its cost or solve a number of technical problems. Musk ‘gave away’ the idea, rather than committing to develop it, but that did not dismay half a dozen start-up companies. A recent Bloomberg article recounts that “Hyperloop Dreams Endangered After SPAC Deal Fails” tells part of the story.

Reporter Sarah McBride recounts the 2022 decision by Richard Branson’s Hyperloop One to slash its staff and shift its focus to freight rather than passengers. Not much has been heard from it since then. Her main focus is on Hyperloop Transportation Technologies (known as Hyperloop TT). It had planned to go public on the New York Stock Exchange this month, via a special purpose acquisition company (SPAC), but the SPAC recently backed out, and the offering was scrapped. Recent startup failures include Swissmetro SA (liquidated in 2009) and Arrivo (shut down in 2018).

Hyperloop TT claims to be the leader in this field, touting its full-scale test track in Toulouse, France, pictured in the Bloomberg article. Actually, it’s only 1,000 feet long, far too short to demonstrate accelerating a capsule to 600 miles per hour and then decelerating to a safe stop—which nobody has ever accomplished. In my most recent newsletter article on hyperloop (May 2022), I cited a number of problems about which no solutions have been put forth by advocates or any of the startup companies:

• Maintaining a vacuum in tubes of a thousand miles or more;
• The energy cost of both propulsion and vacuum maintenance;
• Airlocks in stations, to permit the transition from vacuum in the tubes to passenger ingress and egress in normal air pressure;
• Turnouts (switches) in the tubes and how they would work; and,
• Emergency evacuation of passengers.

In a previous article (July 2020), I wrote about two hyperloop studies, one by Lux Research on technical barriers and the other on Hyperloop TT’s proposed Chicago to Pittsburgh route, whose economics are highly questionable. Several years ago, I attended a session on that project at the Transportation Research Board’s annual meeting, which was mostly analysis-free hype that was so egregious that I sent a protest to the TRB’s executive director. That project is still being touted by various public agencies in Ohio and elsewhere in the Midwest. As of now, that appears to be the company’s only live prospect. Bloomberg’s McBride recounts previous company efforts in South Korea (2017), China (2018), and Abu Dhabi (2018), all now defunct.

My skepticism remains, since no solutions have been offered for hyperloop’s technical questions, nor have there been objective benefit/cost analyses following normal best practices. It appears that potential investors are taking note of these shortcomings.

» return to top

How is Vision Zero Doing in Denver?
By Baruch Feigenbaum

As cities across the United States grapple with traffic fatalities, many have adopted the Vision Zero concept. Vision Zero was started in Sweden more than 25 years ago. It is an effort to reduce traffic fatalities to zero by some future date. Unfortunately, most of the U.S. cities that adopted the policy don’t have good before-and-after data, so it is difficult to determine whether Vision Zero works.

Denver, in contrast, has robust data. The city adopted Vision Zero in 2017 and set a goal of zero traffic fatalities by the year 2030. Yet a new report by Randal O’Toole for the Thoreau Institute examining the impacts of Vision Zero policies on traffic fatalities in Denver found that the city’s plan has so far failed to meet most of its goals.

The report begins with an analysis of Denver’s 48-page Vision Zero Action Plan. The plan seems to be full of platitudes instead of policy solutions. In the third section, titled, “What We’re Doing,” two of the three pages discuss what steps the city is taking, such as:

• Adding flashing lights to alert motorists of a pedestrian crossing;
• Reducing speed limits on a street that had seen several accidents; and
• Changing a traffic signal to include a protected left turn to minimize conflict between pedestrians and automobiles.

The report’s biggest criticism of the action plan is that while it does list the changes the city is pursuing, the plan does very little to show that these changes will reduce traffic fatalities, especially by enough for the city to meet its 2030 target of zero fatalities. In addition, the vision does little to address motorcyclist safety, despite motorcyclists being the most at-risk group on Denver streets.

The report delves into traffic fatality trends in Denver. While there were zero bicycle fatalities in 2020, the report stresses that that’s not necessarily thanks to Vision Zero changes. Denver also had zero bicycle fatalities in 2006, 2009, and 2013. O’Toole found that a five-year average is a far better indicator of actual trends. Likewise, the report notes that the 33% increase in fatalities during the five years ending in 2020, has not been caused by Vision Zero. The real problem is that Vision Zero is not addressing the factors that lead to fatalities.

Next, O’Toole breaks down fatalities by mode of transportation. The report found that pedestrian fatality rates were 50 per billion pedestrian-miles, bicycle fatality rates were 25 per billion bicycle-miles, motorcycle fatality rates were 130 per billion passenger-miles, and automobile fatality rates were 1.3 per billion passenger-miles. Motorcyclists are 100 times more likely to die in traffic accidents than auto users, pedestrians are 40 times more likely, and bicycle riders are 20 times more likely. O’Toole stresses that these are “rough approximations.”

To provide a fuller picture, the report reminds readers of the benefits of the automobile. From the automobile “democratizing mobility” thanks to the affordability of Henry Ford’s Model T, to the increased number of jobs accessible to workers, automobiles brought a host of benefits to the country and the world. The development of highways and streets also has benefits that aren’t just for automobile users. Roads are essential for emergency services and freight, but the former is most relevant to Vision Zero’s goal of saving lives. O’Toole cites a University of Colorado-Boulder study, which found that “for every pedestrian whose life is saved by slowing of auto traffic, 85 people would die due to delays in emergency services.”

In order to reduce pedestrian fatalities, we need to understand that most such fatalities happen at night because pedestrians are intoxicated, cross away from crosswalks, or are among the homeless suffering from mental illness.

O’Toole offers specific suggestions for policies that Denver’s Vision Zero Action Plan fails to include. Each of the suggestions is based on Denver data, and most rely on separating different modes from one another, via methods such as pedestrian barriers to discourage crossing away from crosswalks, separate bicycle boulevards, and a law mandating that motorcyclists wear helmets.

Most critically, the city should start to use a data-driven approach based on the National Highway Traffic Safety Administration’s Fatality and Injury Reporting System Tool, which would prove invaluable as a means of finding where Denver’s problems lie.

Automobile users have become something of a scapegoat for traffic fatalities. Both the report and Vision Zero advocates are right that roadway design is an important aspect of any move to protect non-automobile users; but O’Toole is also right when he says that Denver’s attempt at Vision Zero seems like little more than an attempt to get fewer people driving. Cities that try to encourage a modal shift for citizens often accomplish little more than creating an automobile-hostile environment.

The city of Denver has a lot of work to do to come anywhere near its goal by 2030 since its current Vision Zero approach is not going to reduce traffic fatalities to anywhere near zero.

» return to top

News Notes

Charlotte Express Toll Lanes Green-lighted
On Feb. 15, the Charlotte, North Carolina, Regional Transportation Planning Organization gave the North Carolina Department of Transportation the green light to proceed with plans to procure a project to add two express toll lanes each way to I-77 between the city and the South Carolina border, less than 10 miles away. NCDOT is expected to request proposals for a revenue-financed long-term public-private partnership (P3), similar to the procurement of the express lanes on I-77 north of the city. NCDOT last year received an unsolicited proposal from Cintra, the developer/operator of the existing express lanes, proposing an express toll lane project on the southern corridor. The project is expected to cost in the vicinity of $2 billion.

Toyota Opts for Electric Vehicle Future
The last hold-out among major auto producers last month announced a change of direction. Toyota will now increase its focus on electric vehicles (EVs), following the shift to new CEO Koji Sato, who will take office in April. Sato has called for an “EV-first mindset” that will include a new EV-specialized manufacturing platform. The first of the new EVs will be introduced as Lexus models, while production will continue on its current hybrids and EVs on conventional assembly lines.

Congressman Calls for State Tolling Flexibility
Politico (March 2) reports House Highways and Transit Subcommittee Chairman Rep. Rick Crawford (R-AR) told attendees at the AASHTO legislative conference that he would like Congress to give states the flexibility to toll their own roads. “It’s an important revenue stream, potentially, for states that currently don’t have it… It sounds like I’m cheerleading for tolling — I’m not. I’m cheerleading for giving the states the flexibility to be creative.” And on the same day, Wisconsin House Speaker Robin Voss announced he will try again to get tolling legislation enacted in that state.

Park Over Pittsburgh Interstate Wins Awards
A 2022 project built a park over below-grade I-579 in Pittsburgh’s historic Hill District. The park includes green space, story walls, outdoor classroom space, an amphitheater, and bike and pedestrian paths. The park helps re-unite a community that was divided by the Interstate more than 60 years ago. The project won an Outstanding Civil Engineering Award from ASCE and also a 2023 PCI Design Award from the Precast/Prestressed Concrete Institute.

New Express Toll Lanes Coming to Ft. Worth Area
Under a pre-existing long-term DBFOM P3 concession, Cintra will add one general purpose lane and one express toll lane each way to the congested Loop 820/SH-121/183 Airport Freeway corridor in northeastern Tarrant County. The project is estimated at $300-350 million. Cintra expects the financing, based on projected toll revenue, to be finalized by the end of the year. This expansion is part of the company’s 2009 long-term concession for the North Tarrant Express project, which required the lane additions to be added by 2030. This project appears to be the only express toll lane addition in Texas, due to the legislature’s decade-old moratorium on approving new P3 projects.

Top U.S. City Offices Only Half Full
National data on office occupancy tracked by Kastle Systems shows that as of January 2023, the average office occupancy was only 50.4% of pre-pandemic levels. Stanford University economist Nicholas Bloom told the Washington Post that “Office numbers have flatlined,” due to the increase of flexible work practices between office and home. “Longer run, work from home will clearly rise, as the technology supporting this is improving rapidly.” Also shaping the future of cities is out-migration and in-migration. Data on home searchers from Redfin.com finds 20-30% of local house-hunters in 10 major metro areas are searching elsewhere. For example, the top destination New Yorkers are researching is Miami, and the top destination for Seattle searchers is Phoenix.

First Express Toll Lanes Project in Kansas Breaks Ground
US 69, reportedly the busiest highway in Kansas, will have the state’s first express toll lanes in operation within two years from last month’s ground-breaking, according to the Kansas DOT. The project will add one express toll lane each way in the median of US 69, from 103rd St. to 151st St., the most congested segment. Variable tolls will be used to keep the new lanes from getting overcrowded (and hence, congested). Kansas Gov. Laura Kelly reminded reporters that the new lanes are a choice, available for those with time-sensitive trips and willing to pay for faster and more reliable travel. “This highway is a huge innovation for the state of Kansas,” Kelly added.

Rhode Island DOT Appeals Bridge Toll Decision
Last year a federal court ruled that Rhode Island’s program to charge tolls only to heavy trucks was discriminatory and violated the Commerce Clause of the Constitution. Last month, the Rhode Island DOT asked the U.S. Court of Appeals to review the lower court’s decision, saying that the case raises “important questions related to federalism.” As I wrote at the time, I agree, and I hope the Court of Appeals sustains the lower court’s ruling. The Commerce Clause was included in the Constitution in part to prohibit states from charging tariffs on movements across state borders, which the discriminatory Rhode Island truck tolls were shown to be.

FHWA Replaces “Fix It First” Guidance Memo
Under new Administrator Shailen Bhatt, the Federal Highway Administration (FHWA) has replaced the controversial “guidance” memo issued in Dec. 2021, which implied that state DOTs should prefer projects to fix deferred maintenance to those that expand capacity. After protests from state DOTs in fast-growing states, Republican members of Congress, and a number of business groups, the new policy memo defers to state decision-makers on how to prioritize highway spending and also clarifies that the document “does not have the force of law.”

Three More States Taking Action on Mileage-Based User Fees
In December, the Washington State Transportation Commission voted in favor of replacing per-gallon fuel taxes with per-mile charges. It urged legislators to replace state fuel taxes with per-mile road user charges beginning in 2027. Louisiana’s Department of Transportation & Development announced in February that it plans a state-funded mileage-based user fees pilot project covering up to 4,000 vehicles. Also in February, Oklahoma DOT briefed the state’s transportation commission on its road user charge pilot project, called Fair Miles Oklahoma, to begin in July. Oklahoma’s legislature in 2021 authorized ODOT to create and manage such a pilot project.

Xoox Autonomous Vehicles Operating on Public Road
Xoox, Inc., a self-driving startup owned by Amazon, has developed a passenger shuttle without a steering wheel or other driver controls. Last month it began shuttling employees between its two main buildings in Foster City, CA, on a mile-long stretch of public roadway, at a top speed of 35 miles per hour. Xoox has a state permit to operate driverless on this roadway. Bloomberg reported that Xoox believes this is the first time a vehicle with no onboard controls has operated on a public road.

BP Acquires Major Truck Stop Company
Last month, oil company BP announced the $1.3 billion acquisition of Travel Centers of America, the operator of 281 truck stops near major highways. In a presentation on the deal, BP illustrated a potential future travel center offering EV charging for trucks, a convenience store, biofuels, and eventually hydrogen refueling. Given the national shortage of safe overnight truck parking spaces, and also of EV charging, perhaps BP has the clout to get Congress to repeal the 1960 federal ban on commercial services at Interstate highway rest areas. Even the American Trucking Association’s research arm acknowledges that the ban is an impediment to expanded truck parking and electric vehicle charging.

FDOT Planning to Extend I-4 Express Toll Lanes
One year after their opening on 20 miles of I-4 in Orlando, the express lanes’ success is leading Florida DOT to start researching extensions. Over 10 million trips were taken in the lanes’ first year, with an average of 28,000 drivers per day using them. Studies are under way on extensions of the lanes both north and southwest of Orlando, since major congestion occurs on both of those I-4 segments.

“Modal Shift to Cleaner Transport Fails to Materialize”
That is the headline on a release from OECD’s International Transport Forum in Dec. 2022. The study collected transportation data from the years 2010 through early 2020 from OECD member countries. Some of the findings were that “the share of passenger transport by car increased for all reporting countries between 2010 and 2021,” that “inland freight transport does not show a shift to more-sustainable modes,” and that “rail passenger transport in Europe . . . dropped 51% between 2019 and 2021.”

Ford Dumps EV Startup Rivian
Electric vehicle maker Rivian, which is producing and selling its EV SUVs and pickup trucks, had a terrible 2022. Its share price dropped 82%, wiping out over $75 billion in value. That was bad news for early investors Amazon and Ford Motor Co. Luc Olinga of The Street reported last month that Ford, which had invested $1.2 billion in Rivian, sold 91 million shares early last year before the price plunged, making a gain of $1.8 billion. It sold another 25.2 million shares in May for $700 million, and another 51.9 million shares in the third quarter for $1.8 billion. Overall, at year-end, Ford reported a net loss of $7.4 billion on Rivian and another $2.7 billion loss on Argo. Amazon has not sold its Rivian shares.

Some Good Reading

“Driverless Work Vehicles: On This Side of the Horizon” is a well-researched global overview of commercial applications of autonomous vehicles.

“Off the Rails: Minnesota Transportation After COVID-19” is Randal O’Toole’s across-the-board assessment of what Minnesota transportation planners might do to adjust to our post-COVID world, published by the Center of the American Experiment.

» return to top

Quotable Quotes

“The relationship between land use and traffic generation has been known for many decades. There’s nothing particularly new here, although I’m sure the [Baltimore] article will be circulated by the ‘highways are evil’ crowd. The supposed solution in this article is that Americans should live like Europeans, that is, densely packed 900 square-foot apartments in metropolitan areas. My common answer to persons telling me how we should have public transportation like Paris (or fill in the blank) when they return from their vacation is, ‘We can have a European transportation system if we want to live like Europeans.’ Americans have chosen the quality of life they want to enjoy for their families, and it is not the one envisioned in this article.”
—Pete Rahn, private online commentary, Feb.5, 2023 (used with permission)

“The notion of access vs. mobility is a common thread in all our work. Just about everything in America focuses toward mobility for multiple sound reasons. If you want standard store white bread, the nearest 7-11 will do. But if you want really great Russian black bread with raisins, I know this really great baker in Baltimore! . . .  Favorite restaurants, family, and friends all live at distances. They don’t optimize access to you, mostly. . . . If I work at 7-11, I can likely walk to work. If I teach in a university, and shift to another, it is likely 10-15 miles away. Do I move every time I change jobs? The decline of the “center” for shopping, for entertainment, for jobs is a major factor. Small metros are the last bastion of a heavy focus on the center; as that metro grows, satellite centers become alternatives.”
—Alan Pisarski, private online commentary, Feb. 6, 2023 (used with permission)

“Across the rich world, the commercial property industry is in a grim state. Tenants have come to terms with the fact that working from home is here to stay, and are downsizing appropriately. In cities such as Hong Kong, London, and Paris, vacancy rates have hit record highs. Another indicator of the darkening mood is that global investment in offices last year fell by 42%, compared with a 28% drop for property as a whole. A recent paper by Arpit Gupta of New York University and Vrinda Mittal and Stijn Van Nieuwerburgh of Columbia University forecasts that offices in New York could lose almost 40% of their value between 2019 and 2029, equivalent to $453 billion.”
—”Property: The View from the Top,” The Economist, Jan. 21, 2023

“Automated container handling is essential to quicken the pace of cargo movement through port facilities. The technology is costly, and longshore labor unions are fiercely opposed. The International Longshore and Warehouse Union has held up contract negotiations for months over the issue. Lack of automation is one reason U.S. ports rank low in global productivity relative to ports in China and the Middle East. Ensuring quick container flow through ports must be an economic priority, regardless of union concerns.”
—Peter Tirschwell, “How to Prevent the Next Supply Chain Crisis,” The Wall Street Journal, Feb. 6, 2023

» return to top

The post Surface Transportation News: Ohio train derailment, induced demand and urban freeway expansion, and more appeared first on Reason Foundation.

Since the 1990s, there have been several attempts to build a publicly funded or financed high-speed rail line linking Dallas and Houston. Ultimately, none of these efforts succeeded. Most recently, in 2013, Texas Central Partners proposed building a privately financed high-speed rail line between the two largest metro areas in Texas. When the project was announced, many passenger rail researchers thought it was an intriguing concept. Privately funded or financed infrastructure could be 20% cheaper than publicly funded infrastructure. In addition, Texas Central’s point-to-point system presented an alternative to California’s three-sides-of-a-square line linking Los Angeles with San Francisco via many much smaller cities.

However, Texas Central’s vision for its project did not match the realities on the ground. Cost estimates quickly swelled from $10 billion to more than $30 billion by April 2020. This author’s quantitative analysis of potential ridership projected 1.4 million passengers per year, a far cry from the 5.9 million passengers per year Texas Central claimed.

A train with such a low ridership could not come close to generating the revenue or profits that Texas Central promised. Given the hundreds of millions of dollars in annual subsidies that would be required to operate Texas Central’s project, private investors showed little to no interest.

Texas Central’s proposal also faced significant opposition. Farmers, ranchers, and other landowners objected to having their land bisected by a train traveling at 200 miles per hour over 30 times each day. Elected officials between Dallas and Houston mobilized to voice their constituents’ opposition to the project. The Texas Legislature passed a law prohibiting the state from spending any funds on the project.

The Environmental Protection Agency refused to sign off on Texas Central’s preferred station in downtown Houston, forcing the company to move its southern terminus to the western suburbs. Finally, freight rail lines objected to Texas Central’s proposed signaling system because it would interfere with existing communications technology.

Facing delay after delay and setback after setback, Texas Central appears to have finally accepted reality. By late June 2022, Texas Central’s chief executive officer and all of its board members had resigned.

Texas Central still faces legal challenges that must be addressed. Due to the company’s ongoing financial difficulties, it remained delinquent on its 2021 property taxes into 2022 and has yet to pay its homeowner association dues in several impacted counties. Despite these facts, it remains unclear whether Texas Central has abandoned the project permanently or merely placed it in hibernation.

Assuming Texas Central attempts to resuscitate the project, this brief examines four barriers to doing so: (1) the continually escalating costs of building and operating high-speed rail, (2) the limited and declining pool of potential ridership, (3) Texas Central’s status as a zombie company, and (4) the lack of federal or state support for Texas Central’s project.

Texas Central High-Speed Rail: A 2023 Update

The post The current status of Texas Central’s proposed high-speed rail line linking Dallas and Houston appeared first on Reason Foundation.

• Michigan Interstate tolling study released
• Traffic congestion roars back, despite work from home
• Tennessee moving forward on P3s, express toll lanes, and MBUFs
• Unions oppose automated trucking legislation in California
• Seven new MBUF pilot projects announced
• Time to change the basis of truck user fees?
• News Notes
• Quotable Quotes

Michigan Interstate Tolling Study Released  

Last month the Michigan Department of Transportation (MDOT) released the results of its two-year study on the potential of using toll finance to upgrade and modernize the state’s aging Interstate highways and other limited-access highways. After several rounds of screening, its strategic implementation plan focuses on eight initial corridors (called Tier 1) totaling 545 route miles, all but one of them Interstates. This is the fourth such statewide study, following earlier ones in Connecticut, Indiana, and Wisconsin. It was carried out by respected firms HNTB and CDM Smith. Having read the previous ones, I think this study is the best one to date. Some previous studies have focused mostly on the potential revenue that could be generated, rather than on the benefits of toll-financed modernization. The Strategic Implementation Plan, which is one of several outputs of the Michigan study, documents the investments needed for the eight Tier 1 corridors: $18.5 billion in road and bridge improvements. Moreover, contrary to fears of the trucking industry that states would start tolling immediately without guarantees of using the new revenue for modernizing their highways, the plan shows tolls being phased in as various Tier 1 segments are modernized (which I have referred to as value-added tolling).

I was surprised at first that investments for Tier 1’s 545 route miles included only 164 lane miles of new capacity. But Michigan is a low-growth state. A table of estimated state vehicles miles travelled growth rates that I obtained several years ago from an FHWA analyst showed Michigan’s light-vehicle growth rate at just 0.4% per year (though the heavy-vehicle growth rate was three times that at 1.2% per year). So the $18.5 billion capital spending for Tier 1 makes sense as being mostly for replacing or upgrading existing lanes and bridges.

The implementation plan estimates the costs of electronic tolling infrastructure and recommends going with the 6C protocol, which seems to be the emerging electronic tolling consensus. It presents a pro-forma financing plan, based on projected gross and net toll revenue, which the plan estimates would lead to the toll revenue bonds achieving a BBB (investment-grade) rating. The plan concludes that the modernized Tier 1 corridors would be fully self-supporting (capital and operating/maintenance costs) via the toll financing.

The study also reviews the available federal programs under which toll-financed Interstate modernization can take place. It rejects the never-used Interstate System Reconstruction and Rehabilitation Pilot Program since that allows a participating state to toll-finance only a single Interstate corridor. For most of the Tier 1 corridors, it recommends using the Section 129 Bridge & Tunnel program, with the Value Pricing Program recommended for two urban corridors where variable pricing would be used to reduce congestion.

Of course, this is only a study. Michigan DOT, I hope, will want to pursue implementation of it, but that will be up to elected officials—the governor and the legislature. If they decide to implement something along the lines of what these reports have identified as feasible, I can suggest several possible revisions.

While the plan to implement tolling as corridors are modernized addresses one of the highway user community’s concerns about tolling, the study ignores legitimate concerns about “double taxation”—paying both tolls and fuel taxes for the same corridor. The study acknowledges the coming need to replace fuel taxes with mileage-based user fees (MBUFs), but it ignores a key tenet of the ongoing state pilot programs: that the mileage-based user fee is intended to replace the fuel tax, not be charged in addition to it. What would fix this problem is to make the new Interstate tolls Michigan’s first MBUFs. That would mean providing refunds/rebates for fuel taxes incurred for miles driven on the newly tolled Interstates, demonstrating that MBUFs really will be replacing fuel taxes when implemented.

Michigan DOT and legislators might be concerned about the cost of providing fuel-tax rebates, but the study itself recommends devoting 5% of gross toll revenue to various kinds of toll discounts and rebates, some of them highly questionable. In a peer-reviewed study just published in Transportation Research Record (the journal of the Transportation Research Board), I used a detailed spreadsheet model to estimate the net present value (NPV) of fuel tax rebates to motorists and truckers driving on rebuilt, tolled Interstate corridors. The NPV of state fuel tax rebates over 30 years was less than 7% of the gross toll revenue.

And there would be another benefit of making the tolled lanes Michigan’s first large-scale conversion from per-gallon taxes to per-mile charges: less traffic diversion. The strategic plan estimates, by corridor, that diversion rates would range from 6% to 18%, based on light vehicle tolls of six cents per mile and heavy truck tolls of 24 cents per mile. For light vehicles, the state gas tax works out to 1 cent per mile. Since diversion rates are proportional to the amount charged, with fuel tax rebates, the “net” toll rate for cars would be five cents a mile, not six cents. Thus, diversion rates should be about 17% less than estimated on page 57 of the strategic plan, so they would range from 5% to 15% of the traffic. That would lead to increased gross revenue, as well as less diversion.

Another concern of mine is the projected cost of toll collection, at 13% of gross revenue, which strikes me as very high for a system designed from scratch to be all-electronic. The killer is the assumption that license-plate billing will be needed for about 20% of all transactions. That, in turn, requires a traditional back office to analyze video images, generate and send bills, and accept losses due to bills that end up being uncollectible. If the model for toll-financed Interstate modernization included making it Michigan’s first large-scale MBUF conversion, it would be worth considering designing it for 100% use of transponders with pre-paid accounts—or at least including video-tolling surcharges high enough to fully cover the costs of billing and collection. I note in passing that many express toll lanes do not offer video tolling, and, thereby, have much lower costs of collection, as low as 3.9% of toll revenue.

Finally, one other point. Although the study mentions long-term public-private partnerships (P3s), it does not recommend this approach for financing, developing, operating, and maintaining tolled Interstates. Instead, it calls for creating a traditional toll agency, something the state of Michigan has no experience with. While this could provide an opportunity to draw on newer toll agency models such as Florida’s Turnpike Enterprise, it would be worth considering the experience of a growing number of state transportation departments with long-term design-build-finance-operate-maintain P3s, which have an excellent track record with revenue-financed express toll lane facilities across the country, nearly all of which have investment-grade ratings.

» return to top

Traffic Congestion Roars Back, Despite Work from Home

The 2022 INRIX Global Traffic Scorecard was released last month, and it shows a strong resumption of metro area traffic congestion, despite the continued high level of telecommuting. The same pattern appears in major metro areas in Europe, Latin America, and South Africa.

The INRIX global top 25 most-congested metro areas table resembles the 2021 ranking, with London still in first place, Paris in third place, and Toronto moving up from 22^nd to 7^th place. The 10 most-congested metro areas worldwide had delays ranging from 121 hours per driver to 156 hours per driver in 2022.

For U.S. cities, Chicago moved up to 2^nd  from 6^th place, Boston zoomed from 18th to 4th, and Miami rose to 9^th from the previous year’s 32^nd place. Other areas rising a lot included Los Angeles, up to 14^th from 33^rd, San Francisco, from 15^th from 34^th, and Washington, D.C., which went from 99th to now 20^th.

The changes in congestion rank for U.S. metro areas were nowhere near as dramatic as the worldwide changes. Here are the key 2022 INRIX figures for the top 10 metros.

Many factors are responsible for these traffic congestion results, but let me suggest a few that might be relevant. First, despite much rhetoric arguing that traffic congestion is a byproduct of low-density sprawl land-use patterns and that higher density and mass transit are the answer, the top four U.S. metro areas are all characterized by high-density and high-transit mode-share, in comparison with lower-density, low-transit Miami, Los Angeles, San Francisco, and Atlanta.

Second, which of these areas have added express toll lanes to portions of their freeway systems? Miami, Los Angeles, San Francisco, the Virginia suburbs of Washington, DC, Houston, and Atlanta.

One other point about density and transit as the long-term solution: urban agglomeration benefits. Extensive research shows that large metro areas are generally more economically productive than smaller ones because a lot more positive-sum transactions can take place in the former—assuming there is fast and reliable transportation from any origin to any destination (since both residences and jobs are spread out all over the landscape). (See Alain Bartaud’s excellent book, Order Without Design, MIT Press, 2018)

Less-congested freeways, due to variably-priced express lanes, contribute to employers having a wider choice of qualified prospective hires and workers having many more good employment options. The same is true, in theory, of a large transit network. Yet, a series of “access to destinations” studies by University of Minnesota researchers have shown that in most large metro areas one can get to nearly all the potential jobs in 30-45 minutes by car, but to very few via transit.

» return to top

Tennessee Moving Forward on P3s, Express Toll Lanes, and MBUFs
By Baruch Feigenbaum

Some of the early pioneering states that used managed lanes and public-private partnerships (P3s), including Florida and Texas, have quit building projects in recent years due to political pushback. Politicians in these states have also pushed back on mileage-based user fee pilot programs due to concerns about how the technology would be implemented. At this time, only two states—Georgia and Virginia—are using public-private partnerships to build multiple express toll lanes and implementing an MBUF pilot and/or permanent program.

Fortunately, a new state, Tennessee, looks poised to join Georgia and Virginia in making major improvements to its highway system and funding stream. In his Feb. 6 State of the State address, Tennessee Gov. Bill Lee highlighted an aggressive plan to build a network of choice lanes (managed toll lanes with better branding) in five of the state’s metro areas. All of the lanes would be built using toll concession P3s. And in a Feb. 1 hearing, Senate Transportation Committee Chair Becky Massey explored how an MBUF program would work in Tennessee. 

This new attention to funding and financing highways is badly needed. Despite having one of the nation’s highest growth rates, Tennessee ranks last in the country in per capita transportation investment. Few of its rural Interstates have been widened to more than two lanes in each direction. And despite reaching the end of their 50-year lifecycles, almost none of the Interstates in Tennessee have been reconstructed. 

The current plan is to add choice lanes to urban Interstates in Nashville, Memphis, Knoxville, and Chattanooga, as well as the Tri-Cities of Bristol, Johnson City, and Kingsport. Memphis and Nashville have poorly performing high-occupancy vehicle lanes that can be converted to choice lanes. For example, almost 80% of the vehicles in the Nashville I-24 high-occupancy vehicle lanes are cheaters; they don’t have the required two people. Finding a carpool companion in low-density metro areas built after World War II, in which people are traveling from many origins to many destinations, can be very challenging. Some of these drivers would gladly pay a small per-mile toll to have a more reliable commute. But today, they don’t have that option. 

Many of the corridors in Memphis and Nashville are good candidates for new express toll lanes, but the most intriguing options may be in Chattanooga and Knoxville. I-24 in Chattanooga, between I-59 and I-75, is a critical bottleneck between Nashville and Atlanta. Bounded by the Tennessee River and mountains, I-24 could benefit from the innovative approach a P3 concessionaire brings to the table. The section of I-40 and I-75 that runs concurrently near Knoxville has the highest traffic volumes, and truck volumes in the state. Already with eight lanes, it is congested much of the day, seven days a week, with traffic volumes growing each year.

Tennessee is planning to build the lanes as toll concession P3s. Toll concession P3s have several advantages. The first is that the tolls provide a new revenue source. Tennessee has about $500 million annually for new capacity for the entire state. Clearly, that is not enough for a growing state of seven million people. Importantly, a toll concession model, in which the private sector takes the revenue risk, has a big advantage over a hybrid model, in which the state takes the revenue risk. Nobody could have predicted the COVID-19 pandemic, and hopefully, we won’t see another pandemic in the near future. However, states that used toll concession P3s that transferred the revenue risk to the private partner were in much better financial shape than states that kept the risk. States in the latter category had to delay or cancel other projects. In speaking with Tennessee officials, I learned that risk transfer was a big factor in choosing toll concessions.

Tennessee Department of Transportation leaders plan to make some other innovative delivery changes. Currently, Tennessee has a cap on the number of projects for which design-build can be used. The cap is in place because small construction companies were worried that they could not compete for DBs, and thus preferred traditional design-bid-build (DBBs). But transportation leaders spoke with these stakeholders and explained how in both P3s and DBs they could be subcontractors on large, previously unaffordable projects. This helped broaden support for both reforms.

Meanwhile, in the Tennessee General Assembly, Transportation Chair Becky Massey led a hearing on MBUFs. Trish Hendren of the Eastern Transportation Coalition and I testified on the advantages of MBUFs and conducting an MBUF pilot. I focused on the problems with the fuel tax, the advantages of MBUFs, potential pilot ideas, and funding sources for the pilot. I also detailed existing MBUF programs and pilots in the bordering states of Georgia, North Carolina, and Virginia. Trish touched on the importance of communicating the transportation funding problem, how MBUFs can benefit rural residents, and that the public does not understand how transportation funding works.

Senators asked questions and received answers about environmental challenges (there are not any more than with the gasoline tax), double taxation (MBUFs would replace fuel taxes), rural residents (rural residents would pay less in an MBUF than with a fuel tax), payment options (there are multiple types including GPS-based transponder, odometer reading, etc.), and payment timeframes (once per month, once per quarter, etc.). I’ve never seen a committee as legitimately engaged at a hearing. House Transportation Chair Dan Howell was also at the hearing and was very intrigued by the MBUF option.

The next step for the choice lanes and innovative delivery is for a bill to be introduced in the Senate. Analysts expect it to pass the Senate and House transportation committees and, given it is one of the top priorities of the year, pass the full bodies and be signed into law this year. While MBUFs are another key priority, there is more education needed before a bill for a pilot can pass the General Assembly. MBUF action is more likely in early 2024.

» return to top

Unions Oppose Automated Trucking Legalization in California
By Marc Scribner

California was once at the forefront of automated vehicle (AV) policy. Driven by Silicon Valley developers outside the traditional automotive industry, the AV industry in the U.S. remains concentrated in the Golden State. California has authorized AV testing and limited deployments on public roads, but these have excluded heavy-duty vehicles. Regulators recently began considering authorizing heavy-duty AVs in the state, but union-allied politicians quickly introduced legislation that would ban the testing and deployment of heavy-duty AVs without human drivers present in the vehicle. This would effectively kill the business case for AV trucking, as well as the safety and consumer benefits that AV trucks could offer.

Despite California’s ever-tightening regulatory environment, automated vehicle developers in the early days were optimistic about making progress in the state. California’s first AV law, Senate Bill 1298, was even signed into law by then-Gov. Jerry Brown at Google’s Mountain View headquarters in 2012. Fast forward a decade, and California’s AV policy has fallen behind states such as Arizona, Arkansas, Florida, and Texas, which lack California’s intensive permitting approach to AV testing and deployment.

While the California Department of Motor Vehicles (DMV) has allowed AV testing and deployments to take place on public roads, these operations have been strictly limited by DMV regulations to vehicles weighing less than 10,001 pounds. In January, the California DMV began considering updates to its AV testing and deployment rules that would end this arbitrary prohibition. It held a public workshop on Jan. 27 (video).

The International Brotherhood of Teamsters, which represents a small fraction of California truck drivers, had already begun whipping up opposition before the public workshop. On Jan. 26, California Assemblymember Cecilia Aguiar-Curry, with principal coauthors, assemblymembers Ash Kalra and Tom Lackey, introduced Assembly Bill 316, which would prohibit AVs weighing 10,000 pounds or more from being “operated on public roads for testing purposes, transporting goods, or transporting passengers without a human safety operator physically present in the autonomous vehicle at the time of operation.”

On Jan. 31, the Teamsters and California Labor Federation held a rally outside the state capitol in Sacramento with Aguiar-Curry, Kalra, and Lackey in support of their bill. While framed as supporting safety, despite poor human decision-making being a factor in nearly all vehicle crashes, attendees made clear they were really concerned about the potential for reductions in driver jobs—and dues-paying union drivers—that would arise from safer AVs. “Tech companies don’t talk about people. They don’t talk about families that depend on the jobs that you all rely on,” said Assemblymember Kalra.

AV opposition organizers also made clear that they believed that if California, under single-party control, couldn’t stop AV trucking, there would be no way to withstand the tide of transportation technology progress in the rest of the U.S. “So goes California, so goes the rest of the nation. If we lose this, we’re never getting them back,” Teamsters Vice President Lindsay Dougherty told the crowd, according to a Los Angeles Times report on the rally.

California does have an outsized influence on the national AV policy stage. Not only is it the largest state by population, but California is also home to the ports of Los Angeles and Long Beach, two of the largest container ports in the U.S. This makes Southern California an ideal near-term deployment candidate for short-haul automated drayage operations as well as a hub for long-haul operations into the wider Sun Belt. A recent study from Carnegie Mellon University engineers that was highlighted in the April 2022 issue of this newsletter found that AV trucking in the Sun Belt could impact 10% of nationwide truck operator hours.

But a lack of driver labor is a constant complaint from the trucking industry, with the American Trucking Association claiming that the U.S. was short nearly 78,000 drivers in 2022. A shallow pool of drivers exacerbated problems in supply chains that had already been strained by economic shocks caused by the COVID-19 pandemic, leading to unprecedented congestion at the ports of Los Angeles and Long Beach. President Joe Biden launched a Supply Chain Disruptions Task Force in June 2021 in response to this international logistics crisis. Importantly, the increased efficiency and flexibility made possible by automation could help prevent similar supply chain chaos in the future.

A.B. 316 already has the support of some in California State Assembly leadership, with Speaker pro Tempore Christopher M. Ward and Assistant Majority Whip Pilar Schiavo signing on as co-authors. A State Senate companion bill likely isn’t far behind. So far, Gov. Gavin Newsom hasn’t weighed in publicly, but he may soon face a difficult choice between doing the right thing for his state and doing the wrong thing demanded by a small but powerful political constituency.

» return to top

Seven New MBUF Pilot Projects Announced

In the bipartisan infrastructure law, the Infrastructure Investment and Jobs Act (IIJA), Congress continued a modest federal program that offers states or groups of states the opportunity to get partial federal funding support to carry out pilot projects on how to implement a transition from per-gallon fuel taxes to per-mile user fees (MBUFs, referred to as road user charges—RUCs—in western states). Last month, the Federal Highway Administration (FHWA) announced the seven 2023 winners in the Surface Transportation System Funding Alternatives Program (STSFA).

Some of the projects are first-time statewide projects (Michigan and Oklahoma), while others are continuations of prior statewide projects (California, Hawaii, Minnesota, and Virginia). And one project is a continuation of multi-state efforts coordinated by The Eastern Transportation Coalition (TETCo). Both Michigan and Oklahoma will be designing and carrying out their first pilot project, recruiting volunteers to try out simulated per-mile charges as an alternative to the state fuel tax. Michigan will begin with a statewide survey of citizen perceptions of MBUF/RUC, which will help to inform the design and operation of the pilot test. Oklahoma’s voluntary pilot program will consider working with the state’s turnpike authority (due to its revenue-collecting expertise) and will partner with tribal nations (which may be a first for a state MBUF pilot).

The California Department of Transportation continues to build on what it has learned from previous pilot projects, with the new pilot focusing on methods of revenue collection and the behavioral changes that might result from two different rate structures. Hawaii DOT will build on its initial pilot that linked an annual RUC to annual vehicle inspections and vehicle registration renewal. The focus of Minnesota DOT will be on the potential of using built-in vehicle telematics as a way to collect mileage-fee revenue. And Virginia DOT will transition its initial voluntary MBUF program from a fixed fee to a per-mile charge.

In the largest of the seven projects, the TET Coalition will work with seven of its 17 member states (Delaware, Georgia, Maine, Maryland, North Carolina, New Jersey, and Pennsylvania) to build on its several previous pilots involving both passenger vehicles and trucks, in a multi-state environment. This organization has worked extensively with trucking companies and organizations, for which inter-state travel is critically important. Among other things, the new pilot will work on equity concerns, compliance and enforcement questions, privacy issues, and harmonization among states.

Multi-state efforts such as those of the TET Coalition have brought in quite a few states that have not done their own state-specific MBUF/RUC pilots, thereby raising awareness of this subject in a growing fraction of all states.

» return to top

Time to Change the Basis of Truck User Fees?
By Aarne Frobom

“The Turner Proposal” sounds like a second-rate spy novel, but it’s the name of an alternative approach to the design of heavy trucks, and it could guide the design of future truck user fees.

Heavy trucks impose costs on the road system in three ways: in pavement wear due to weight; in capital cost for lane width, bridge and pavement strength, and intersection geometrics; and in congestion by using up capacity. States charge for these costs in fuel taxes and registration fees.  The fuel tax is a proxy for a toll for capacity used. Registration fees based on gross vehicle weight (GVW) are a way of charging for roads strong enough to carry trucks.

But is gross weight the best measure? 

The federal government long ago settled on the 80,000-lb. five-axle semitrailer as its principal unit of freight transport. Following the elaborate AASHO Ottawa Road Test of 1956‑60, the Bureau of Public Roads (predecessor of FHWA) adopted pavement designs anticipating an 80,000‑lb. truck. But truck traffic on the Interstates grew faster than anyone imagined. By the time the first Interstate pavements reached their 20-year design lifespans, pavement wear was becoming evident. One of the architects of the Interstates, Frank Turner, asked, Did we get it wrong? Are single-axle loads of 16,000 to 18,000 lbs. too heavy?

In 1984, Turner proposed a class of trucks with significantly reduced axle loadings, to reduce some classes of pavement wear and preserve the investment in the Interstates. Such trucks would be closer to Canadian and European designs, where 3-axle trailers are standard.

Since then, U.S. trailers have gotten longer, but there has been no movement toward alternative axle loadings. But the trends of worsening pavement condition, declining purchasing power, increasing truck volume, and replacement of diesel power with electric trucks mean it’s time to re-think truck user fees and truck design from the axles up.

More trailer axles could be mandated, but truck operators should share in the savings from pavement-friendly designs. States could keep their elected-GVW-based registration fee for standard trucks, but a fairer approach would be to reduce the usual fee if a truck operator uses a multi-axle trailer with less than the standard 16,000-lb. axle loadings—say, 13,000 lbs. or thereabouts. The reduced fee might be adopted simultaneously with an increase in other fees generally, as a means of mitigating the impact on highway revenues.

The new axle-weight registration fee could be administered under the existing International Registration Plan (IRP) with minor changes.  (Under IRP, trucks in interstate commerce elect a maximum gross combination weight for every state and province they operate in, and pay each state’s weight-based registration fee, apportioned by miles traveled in each state, on a single tax return.)  Jurisdictions would keep their schedules of weight-based fees, but trucks electing lower axle loadings would pay a reduced or “commuted” fee as if they were operating at a lower GVW. An 80,000-lb. combination with a multi-axle trailer might pay as if it weighed 54,000 lbs., or some other number. A color-coded plate and cab card would tell weight enforcers that the truck must be held to maximum axle loadings, in jurisdictions adopting this idea. 

If a jurisdiction’s bridge designs allow it, legal gross weight might be increased while axle loadings fall, for greater productivity. A few states allow trucks over the 80,000-lb. standard.  One state, Michigan, allows 11-axle combinations, often carrying 154,000 lbs. on eight 13,000-lb. trailer axles.

A shift to axle-weight-based fees could be part of changes to road-user charges generally. A growing number of officials expect the fuel tax to be replaced by a mileage-based user fee (MBUF) impelled by a shift to electric vehicles. If we change from charging by gallons to charging by miles, we could combine it with the registration fee, and eliminate one whole tax structure. For trucks, a single fee could be based on elected axle loading in each jurisdiction.  Combining mileage and weight charges into a single fee would allow more headroom for a discount incentivizing light axle loadings. Current unique single-state taxes (in Oregon, Kentucky, and New York) are inefficient and objectionable to truckers, and could be rolled into the fee as well.

Work is needed to quantify the savings in pavement wear and determine appropriate fees. Truck cost allocation is a tricky problem that will not be made simpler by a range of axle loadings. It’s unclear how big a fee reduction would be needed to incentivize purchase of multi-axle trailers. But the exponential increase in some kinds of pavement wear with axle loadings is real, and it should be reflected in road charges.

Aarne Frobom is a policy analyst for the Michigan Department of Transportation.  This article reflects his personal views and is not a statement by the department.

» return to top

News Notes

Colorado Rejects I-25 North Express Lanes Project
In November, the Colorado Transportation Investment Office rejected an unsolicited proposal from Roadis USA to finance, build, and operate long-planned express toll lanes on 21 miles of I-25 north of Denver. While few details were released, CTIO said that the proposal failed to be approved by the CDOT review panel. Public Works Financing (Nov. 2022) noted that the Colorado Transportation Commission in Dec. 2021 issued a rule capping GHG emissions in metro area long-range transportation plans, which has led to a number of highway projects being rejected. The rule also allows the state to reallocate federal IIJA highway funding to transit, bike, and walk infrastructure.

Charlotte Moving Toward I-77 P3 Decision
The Charlotte (NC) Regional Transportation Planning Organization (CRTPO), after having been briefed on the unsolicited proposal from Cintra to add express toll lanes to I-77 between the city and the South Carolina border, will vote on Feb. 15 on whether to ask NCDOT to proceed with a competitive procurement for the project. If it is approved, the project would add two express toll lanes each way on the 9.4-mile stretch of I-77, under a proposed 50-year P3 concession. Going forward with a P3 would lead to the ETLs being developed years sooner than if the state built them conventionally.

Louisiana P3 Toll Bridge May Break Ground Next Year
With the award of a $150 million Mega Grant announced in late December, Louisiana’s $1.5 billion I-10 Calcasieu River Bridge replacement is now expected to have its ground-breaking early next year. The state’s DOT shortlisted four P3 teams in mid-2021, but funding uncertainties have led to delays. The project is planned as a revenue-risk design-build-finance-operate-maintain (DBFOM), but toll revenues are unlikely to fully support the $1.5 billion cost. The $150 million federal grant plus $100 million in state money have put the project back on track toward issuing an request for proposals this spring and negotiating a long-term concession agreement with the winner.

Kansas Turnpike Rejecting Federal Funds
After considering federal infrastructure funds for two planned interchanges near Topeka, the board of the Kansas Turnpike Authority (KTA) has rejected federal funds. FHWA told the agency that accepting federal funds would likely “federalize” the Turnpike, requiring KTA to adhere to various federal regulations and guidelines, might force the closure of its service plazas, and would impact Kansas DOT’s toll credits. KDOT and KTA are now working on plans to pay for the new interchanges.

Georgia Legislators Endorse MBUF Pilot Project
The legislature’s Joint Study Committee on Electrification of Transportation has endorsed Georgia DOT’s plan to conduct a pilot project to test mileage-based user fees in the Peach State. The report urged that the per-mile charge should produce revenue comparable to that of fuel taxes, were fuel tax revenue remaining at levels prior to the advent of electric and hybrid vehicles.

Washington Transportation Commission Endorses RUC Transition
The Washington Transportation Commission submitted a report to Gov. Jay Inslee and the legislature last month proposing a road user charge (RUC) to replace declining fuel tax revenue in coming years. The report recommended that WSDOT continue its current pilot-project efforts, providing information for many decisions that will have to be made, including how to measure and report miles in a manner that both protects privacy and is reasonably cost-effective to collect.

Kansas to Begin Construction of Its First Express Toll Lanes
U.S. 69 near Overland Park will be the first Kansas highway to be equipped with express toll lanes. The $572 million project will add two express lanes to the median of this congested suburban highway. The project, called 69Express, will begin construction this spring. Customers will be asked to use the KTAG electronic toll system already widely in use on the Kansas Turnpike, but the project will also allow license-plate tolling & billing, at a significantly higher cost.

Wyoming I-80 Toll Bill On Legislature’s Agenda
Wyoming State Sen. Cale Case introduced a bill to implement tolling on I-80, with the revenues used for needed improvements. SF 160 would create a state tolling program and a tolling commission. Cole introduced a similar bill in 2021, which passed the Senate but died in the lower house.

Nikola Announces Hydrogen Progress
Although also offering battery-electric versions of its trucks, Nikola is adding infrastructure and services to support its Tre hydrogen fuel cell trucks. Last month it unveiled its first 10,000 psi mobile fueler that will bring compressed hydrogen to locations where truckers can refill their trucks’ fuel cells. The mobile refuelers will supplement Nikola’s permanent hydrogen fueling stations, currently under development. On Jan. 31, Nikola announced its new brand, Hyla, encompassing all elements of its hydrogen fueling system. The company aims to have 60 hydrogen stations in operation by 2026, with  some of the earliest ones planned for Colton, Long Beach, and Ontario, CA.

Fitch Reports Toll Road Traffic Fully Recovered
In a new report released in mid-January, Fitch Ratings found that average toll road traffic for third-quarter 2022 had reached 99% of third-quarter 2019 levels. The data are available from the company’s Traffic Monitor.

Syracuse I-81 Removal Still in Litigation
Although New York state awarded a $296 million construction contract related to the planned removal of elevated I-81 from Syracuse, NY, no work can be done because of an injunction imposed in December due to one of two lawsuits filed against the project. The other suit was filed in federal court, which is also likely to prevent deconstruction as long as it is being litigated. The state court suit argues that the environmental study ignored adverse traffic impacts on neighborhoods from current I-81 traffic that could not be handled by the replacement boulevard.

Four-Acre Park Opens Above Rebuilt I-70 in Denver
The $1.2 billion project that removed an aging elevated section of I-70 east of downtown Denver came with a bonus for the lower-income community that had been cut in two by the construction of the elevated eyesore 57 years ago. Thanks to the P3 project, the viaduct is gone, and that portion of I-70 has been rebuilt below grade. Above the new I-70, at ground level, is a four-acre park. In mid-December, Gov. Jared Polis and Colorado DOT celebrated the new park’s grand opening. Since I-70 is a major auto and truck route, there was no question of “replacing the viaduct with a boulevard.” Instead, traffic throughput has been improved, in part by the addition of an express toll lane each way, and the communities have been reunited.

Travel Centers Adding EV Chargers, Emulating Turnpikes
Travel Centers of America, which announced 30 new truck stop franchises last month, has also announced a joint venture with Electrify America to add 1,000 electric vehicle fast chargers to selected truck stop locations. Meanwhile, the Ohio Turnpike announced plans to add to its existing EV chargers at its service plazas, as other toll roads have also been doing. Toll roads that are also Interstate highways are exempt from the 1960 federal ban on commercial services at “rest areas,” so they can provide easier access to EV chargers, gas stations, and numerous food and other retail operations.

Recommended Reading on the “15-Minute City” Idea
Reason journalist Christian Britschgi does an excellent job of reviewing an idea beloved by some urban planners, the “15-Minute City.” Britschgi’s critique draws on an analysis of the concept by urban transportation expert Alain Bertaud of New York University’s Marron Institute of Urban Management.

» return to top

Quotable Quotes

People travel to improve their place-time personal utility (i.e., their quality of life). Unfortunately, conventional transit hasn’t found a way to provide a low-enough cost of service to substantially induce much demand for its services, whereas widening roads seems to be very effective at delivering additional improved quality of life since, as we are told, they fill up as soon as they are built.”
—Alain Kornhauser, Princeton University,  email to transportation colleagues, Jan. 22, 2023 (used by permission)

“[Street] grids also allow for what Laurence Aurbach, a historian of urban planning, says is the most consistent rule of city design throughout history: functional traffic separation. That is, separation of pedestrians from vehicles; fast vehicles from slow ones; and through traffic from local traffic. Grids have networks of wide main roads and narrow side streets, with pavements and crossings for pedestrians. Faster traffic can be constrained to wider through-streets, where it has to stop less often, leaving narrower residential streets quieter and less polluted.”
—“Going Off Grid: The Sad Decline of the Oldest Form of City Planning,” The Economist, Dec. 24, 2022

“Apple has scaled back ambitious self-driving plans for its future electric vehicle and postponed the car’s target launch date by about a year to 2026, according to people with knowledge of the matter. The car project, called Titan inside the company, has been in limbo for the past several months as Apple executives grappled with the reality that its vision for a fully autonomous vehicle—without a steering wheel or pedals—isn’t feasible with current technology. In a significant shift for the project, the company is now planning a less-ambitious design that will include a steering wheel and pedals and only support full autonomous capabilities on highways, said the people, who asked not to be identified because the information is private.”
—Automotive News Daily Europe, Dec. 7, 2022 (thanks to Michael L. Sena of The Dispatcher)

» return to top

The post Surface Transportation News: Michigan tolling study, traffic congestion returns, and more appeared first on Reason Foundation.

• Should priced managed lanes maximize revenue or throughput?
• This is one way to ruin a railroad
• More evidence of electric grid inadequacy for EVs
• Louisiana gas tax needs replacing, says think tank
• Questions about Tesla Semi’s 500-mile trip
• News Notes
• Quotable Quotes

Should Priced Managed Lanes Maximize Revenue or Throughput?  

Several years ago, I read a critique of priced managed lanes, also known as express toll lanes, developed and operated under long-term public-private partnership (P3) agreements. The commentary accused the P3 companies of using a technique to maximize revenue it called “jam-and-harvest.” This refers to an alleged policy of deliberately increasing the variable toll rate above the amount needed to ensure free flow in the express toll lanes (ETLs) prior to the peak, so as to deter marginal customers from entering the express toll lanes and thereby increasing congestion in the non-tolled lanes. That’s the “jam” part. The “harvest” part is to then continue these higher tolls for those willing to pay them to avoid the super-congested regular lanes.

Just a week ago, a transportation friend sent me the paper that may have originated this concept. It’s a 2015 working paper from the Columbia University Center for Pricing and Revenue Management titled “Revenue Maximizing Dynamic Tolls for Managed Lanes” by Caner Gocmen, Robert Phillips, and Garrett van Ryan. The authors built a simulation model to study various approaches to tolling, using data from the first such express toll lane on State Route 91 in Orange County, California. While some useful early data are available for this facility, as the authors note, it uses a pre-set toll schedule (different toll rates for different times of day) but not actual dynamic tolls, which are adjusted in real-time every few minutes based on actual traffic flow. The report refers to “jam and harvest” but did not identify or obtain data from any operational ETL that actually uses dynamic tolling to see if it adjusts its rates to do something like “jam and harvest” to maximize toll revenue.

As a matter of fact, the report from Fitch Ratings that I wrote about in this newsletter’s Oct. 2022 issue, includes a table (Appendix D) listing specifics for all 14 ETLs that it currently rates. All nine of those that were developed and operated as revenue-financed P3s set toll rates based on revenue maximization. Of the five managed by state agencies, one uses revenue maximization, one uses throughput maximization, and the other three use a blend of revenue maximization and throughput maximization. But we have no idea if any of the revenue maximizers employ something like “jam and harvest.”

So I was disturbed to read a Sept. 2022 report from the Center for Advanced Transportation Mobility of North Carolina State Agricultural & Technical University titled “Equitable Dynamic Pricing of Express Lanes.” This paper cites a 2018 paper and simply asserts that it has been shown that “policies that optimize for revenue create more jam on the regular lanes in earlier time periods to harvest more revenue for the latter part, a phenomenon termed jam-and-harvest.” This still appears to be an assertion, rather than a statement based on empirical data.

A 2019 paper offers another perspective on the ongoing trade-off between throughput maximization and revenue maximization in dynamically tolled lanes: “Tolling Roads to Improve Reliability,” by Jonathan D. Hall and Ian Savage, was published in the Journal of Urban Economics. Unlike many managed lanes researchers, Hall and Savage take into account not only time savings but the reliability of trip times, which were first studied in detail by Kenneth Small and several colleagues, using data from the original SR 91 express lanes. In those studies, trip-time reliability was equally important as actual time savings. Hall and Savage focus attention on traffic volumes that make flow breakdowns likely on limited-access highways, leading to large decreases in throughput. They also build and exercise models, aiming to find a variable tolling policy that takes into account both time savings and the reliability of trip times. Their overall conclusion is that tolls should be high enough to restrict flow into the priced lanes below flow rates that would maximize throughput. In other words, revenue maximization is better for express lanes customers than throughput maximization.

Whether this paper legitimizes what is being called “jam and harvest,” I’m unable to say. Being educated as an engineer, rather than an economist, I cannot advise you on the caliber of the modeling in any of these three papers. But at least state transportation departments that are overseeing revenue maximization policies on P3 managed lanes may not feel they have to apologize for them, if Hall and Savage are correct. Besides revenue maximizing being good for bondholders and ratings, it also appears to be better for managed lane customers.

» return to top

This Is One Way to Ruin a Railroad
By Marc Scribner

The supply and demand shocks that resulted from the COVID-19 pandemic continue to be felt nearly three years after much of the world abruptly shut down. Freight railroads, like most of the businesses that make up supply chains, continue to struggle with workforce challenges, equipment shortages, and shifting customer expectations. While the situation has improved, the pandemic’s fallout is likely to linger through at least this year. This environment has spurred market innovation and this sometimes-painful evolution requires patience from policymakers. Unfortunately, it has also generated misguided and counterproductive proposals from unusual sources.

One example of this latter trend is Bobby Miller writing last month in conservative magazine National Review in favor of nationalizing the infrastructure of America’s private freight railroads (“This Is No Way to Run a Railroad,” Dec. 20). The article gets much wrong about the history, economics, and regulation of railroading while charting a future for America’s railroads that is neither realistic nor desirable. To be sure, the U.S. freight rail industry must adapt to new market conditions emerging in the 21st century, as I detail in a December report published by Reason Foundation (“Freight Rail Deregulation: Past Experience and Future Reforms,” Dec. 13, 2022). But this requires careful consideration of the economic and policy facts of American rail and freight transportation.

Miller’s central argument is that the U.S. rail network would be improved if the government “adopt[ed] a franchise model for freight and passenger rail.” This is a type of vertical separation, whereby rail infrastructure would be held by a government monopolist and train-operating companies would bid to access the government monopolist’s common network. Vertical separation was explicitly encouraged in 1991 by the European Union’s Directive 1991/440.

In the Americas, railroads have generally remained vertically integrated and horizontally separated, with product and geographic competition occurring between vertically integrated railroads rather than exclusively “above the rail” between train-operating companies over a single infrastructure monopoly. The Achilles’ heel of European-style vertically separated railroads has proven to be unreliable funding and mismanagement of the government infrastructure monopolies, which has resulted in bottlenecks and poor service, particularly in freight, where Europe lags far behind North America. In contrast, horizontally separated railroads generally have no difficulty in attracting private investment because network performance incentives are clearly aligned within vertically integrated railroads.

More recent theoretical work has challenged the assumptions underlying the European Union’s longstanding vertical separation favoritism, with economists David Besanko and Shana Cui demonstrating in a 2016 paper published in the Journal of Regulatory Economics that horizontally separated railroads will tend to outperform vertically separated railroads on network quality, consumer welfare, and social welfare metrics. As an aside, during a session at the 2022 Transportation Research Board Annual Meeting, a European rail official said that he believed that the European Union’s past support for vertical separation had less to do with economics and more to do with the political difficulties of constructing a viable multinational, vertically integrated rail network model from European Union member states’ legacy of balkanized, state-owned rail monopolies.

To his credit, Miller does appear to recognize the potential problems with vertical separation by cautioning against the model adopted by the United Kingdom’s privatization of British Rail in 1994, where the U.K. spun off franchised train-operating companies and pooled infrastructure assets into a nominally private monopoly called Railtrack, which was re-nationalized eight years later after serious shortcomings became evident. The pandemic’s fallout more recently led to the collapse of Britain’s train-operating companies, with the rail franchising model anticipated to be replaced in 2024 by a nationalized monopoly called Great British Railways that would set prices and schedules and then contract out operations to private firms. However, Miller then cites Japan’s privatization of Japanese National Railways (JNR) in 1987 as something closer to his ideal.

Unlike western Europe, Japan did not adopt the vertical separation model. Instead, it broke up divisions of the JNR government monopoly into six independent, vertically integrated companies that now make up the Japan Railways (JR) Group. JR Group passenger railroads own the infrastructure in their respective geographic service regions. JR Freight operates nationally over the JR network, securing what are known in the U.S. as trackage rights to operate over the infrastructure owned by JR Group’s passenger railroads. Rather than rail franchising (i.e., vertical separation), JR Group is essentially the inversion of the U.S. system, in which government-owned passenger carrier Amtrak secures trackage rights to operate intercity service on lines owned by vertically integrated private freight railroads.

The network designs of Japanese and U.S. rail systems also serve fundamentally different purposes. The distinct operating characteristics of freight and passenger trains (e.g., speed, length) generally call for prioritizing one type of rail service at the expense of the other. Japan, like Western Europe, has chosen to optimize its railroads to serve passengers over freight. Being a small island country also means Japan can move much more domestic freight efficiently along its coasts by ship (more than 40%), although Japan also moves a greater share of freight by truck than the U.S. does.

In 2018, the last year wholly unaffected by the COVID-19 pandemic, just 8.4% of inland freight ton-miles were moved by rail in Japan, similar to a number of Western European countries. In contrast, rail’s 2018 freight modal share in the U.S. stood at 31.4%—nearly four times Japan’s rail freight mode share. While Japan enjoys a 32.6% rail mode share of combined rail and road passenger miles of travel, rail’s passenger mode share in the U.S. is just 0.5% of surface transportation passenger miles—less than 1/60th of Japan’s.

As with his international rail misunderstandings, Miller gets basic facts wrong about the U.S. rail network. He accuses U.S. freight railroads of “charg[ing] prices well above the rate of inflation” even though inflation-adjusted freight rates are down by more than 40% since the partial deregulation of the industry in 1980. He claims “[t]he one Amtrak route that the government makes a profit on” is with its Northeast Corridor operations between Boston and Washington, the only territory where Amtrak operates as a vertically integrated carrier, even though Amtrak has never turned a profit on any corridor when depreciation is properly accounted for. Amtrak’s failure to adopt generally accepted accounting principles not only tricks people like Miller into accepting Amtrak’s “operating profits” without proper context, but it also diverts attention from the state of good repair backlog in the Northeast Corridor that Amtrak currently estimates to be $43.7 billion and growing.

The inconvenient truth facing passenger rail aficionados like Miller is that passenger rail is usually an unprofitable endeavor. Before Amtrak relieved U.S. private railroads of their passenger service mandates enforced by the Interstate Commerce Commission, railroads had been cross-subsidizing passenger service with freight revenue for generations. Amtrak was only created because freight revenue had evaporated by 1970 under heavy regulation and new trucking competition following World War II. Regulators had refused to grant requested “train off” passenger service discontinuances even after those railroads had gone bankrupt.

While passenger rail hobbyists were enthusiastic about the prospect of Amtrak, the rail industry was simply happy to be free of costly passenger service obligations it could no longer afford. Summarizing the railroads’ perception of Amtrak, one railroad executive remarked at the time that Amtrak primarily served as “a sentimental excursion into the past for legislators over 50.”

Adopting vertical separation in the U.S. would almost certainly cause rail infrastructure investment to crater and networks to deteriorate, with the only beneficiaries being rail’s truck competitors who could capture some of the highest-value traffic from shippers fleeing foundering rail carriers just like they did in the 1960s and ‘70s. History might not exactly repeat itself under Miller’s misguided agenda, but it would likely rhyme, and no one in the U.S. rail industry wants to relive the era of standing derailments with a slightly different soundtrack.

Rather than Miller’s confused rail-franchising proposal, policymakers should instead recognize that the future of rail in America is in freight and look to build on the unambiguous success of partial deregulation carried out under the Staggers Rail Act of 1980. Since then, inflation-adjusted average rail freight rates have declined by 44% while freight volume grew by 57%. Even though the law only concerned economic deregulation, the Staggers Act enabled large safety gains, with a 76% decline in train accident rates and an 85% decline in employee injuries and occupational illnesses.

Despite the clear success of partial rail deregulation, some politicians and special interests seek to reverse these reforms and prevent freight railroads from adapting to new competitive market pressures. A coalition of large industrial shippers is seeking new regulations that would limit railroads’ return on investment and, thus, capacity to invest in system improvements. Tellingly, these shippers have opposed the Interstate Commerce Commission’s successor agency, the Surface Transportation Board, adopting robust benefit/cost analysis for major new regulations similar to what has been required of all federal departmental agencies since the Clinton administration.

With rail’s truck competition anticipated to increasingly automate in the coming decades and with labor accounting for nearly half of truck operating costs, rail must also adopt new productivity-enhancing automation technologies to remain viable through the 21st century. Unfortunately, even small movements in this direction—such as by harnessing existing mandated automation and communications technologies to enable single-person crews on some trains, long the default in Western Europe—have been strongly resisted by rail unions. The unions currently have the support of the Federal Railroad Administration (FRA), the rail industry’s safety regulator, which has proposed a rigid crew-size regulation despite conceding it does not possess “any meaningful data” to support the conclusion that two-person train crews are safer than one-person crews.

Organized labor has also opposed automated track inspection that FRA’s own data finds is more accurate than traditional visual inspections. Automated track inspection would not only improve safety for the trains operating over the rails, it would also keep track inspectors out of harm’s way and reduce rail equipment accidents in the field. While FRA was an early supporter of these improved track inspection technologies, it has recently reversed course at the request of rail unions.

The good news is Congress can protect the gains realized from the Staggers Act and help usher in 21st-century freight rail. It should require that new major rules from the Surface Transportation Board be supported by robust benefit/cost analysis and limit the agency’s discretionary powers. Congress should also explicitly prohibit FRA from regulating train crew size and establish a permanent automated track inspection program not subject to the whims of political appointees.

» return to top

More Evidence of Electric Grid Inadequacy for EVs

The Dec. 2022 issue of this newsletter included an article on the much-cited National Grid study that highlighted major challenges involved in building enough charging stations for a complete transition to electric propulsion, for both personal and commercial vehicles. In December, the trucking industry think tank American Transportation Research Institute (ATRI) addressed this issue, with a focus, of course, on how this would affect the trucking industry. The study’s three main findings are:

1. An all-electric vehicle fleet would require more than 40% of all electricity currently generated in this country, with an especially large fraction of that being needed for heavy long-distance combination trucks.
2. There would be major problems obtaining enough rare earth materials for the amount of battery capacity needed for an all-electric vehicle fleet.
3. For long-haul trucking, a major challenge will be finding enough locations for heavy-truck chargers since there are so few existing places where those trucks can park.

Those are all valid points, but some are more problematic than others. The study estimates that personal vehicles would require 1,040 billion kilowatt-hours (kWh) per year, while trucks of all sizes would require 553.5 billion kWh per year. But that’s a bit misleading because the lion’s share, 75%, of truck electricity demand is from long-distance heavy-duty combination trucks (Classes 7 and 8). If those trucks were excluded, the electric vehicle (EV) demand would be 1,176 kWh/year—35% less. I mention this because a May 2022 ATRI study, “Understanding the CO2 Emissions of Zero-Emission Trucks” did a detailed comparison of the carbon footprint and other aspects of Class 8 diesel, battery-electric, and hydrogen fuel cell trucks. It found that fuel-cell electric was far superior to battery-electric for this category of truck—lower lifetime CO2 emissions and significantly higher payload capacity by avoiding the very heavy battery pack needed for battery electric vehicles, or BEVs.

The current ATRI study covers a lot of the same ground about the costly and scarce minerals needed for BEV combination trucks as the May 2022 study, so I won’t go through that again. Instead, let’s go to the third topic of the new report: the shortfall of truck parking spaces. It cites a 2019 FHWA inventory of such spaces, including 273,000 spaces at private truck stops and 40,000 at highway rest areas. As a barrier to expansion, let me quote a short paragraph on page 43 of the new report:

“At the nation’s approximately 40,000 public rest stop truck parking spaces, commercial charging is not allowable under federal law. This limitation stems from a 1956 regulation that restricts any commercial activity at public rest areas, including fueling or restaurants (though some grandfather clauses exist). This regulation presents myriad challenges to public rest area charging. The likely consequences and implications are that truck charging fees either could not be assessed at public rest areas, could not exceed direct electricity costs, and/or that private sector entities could not provide the charging services.”

The text goes on to cite 2021 lobbying by trucking ally National Association of Truck Stop Operators and others to maintain the ban. And it notes unresolved problems in getting electric vehicle charging installed at private truck stop parking spaces. And in the recap of findings at the end of the report, under the heading “Truck Charging Availability Will Be the Truck Parking Crisis 2.0,” the fourth of six bullet points is the following:

“Other barriers include laws preventing commercial charging at public rest areas and the remoteness of many truck parking locations.”

Kudos to ATRI for identifying this as a significant barrier to truck electrification. My only disappointment is that this report does not cite the Reason Foundation March 2021 study, “Rethinking Interstate Rest Areas,” which makes the same point, and discusses the successful use of private capital to develop/redevelop service plazas on tolled Interstates which are exempt from the federal commercial-services ban. These service plazas are adding EV charging.

» return to top

Louisiana Gas Tax Needs Replacing, Says Local Think Tank

Researchers and transportation analysts in Louisiana are increasingly aware that per-gallon fuel taxes are a problematic long-term revenue source for the state’s highway system. In a Dec. 28 commentary, Jamie Tairov of the free-market-oriented Pelican Institute reviews this problem and suggests possible solutions.

Historically, the state’s gas tax was a pure user tax, with the proceeds dedicated to building, maintaining, and modernizing the state highway and bridge system. Over the past 50 years, most states converted their highway departments to departments of transportation. Louisiana’s became the Department of Transportation & Development (DOTD), and the highway fund became the Transportation Trust Fund, which is responsible for highways, bridges, ports, flood control, etc. And funds going into the Trust Fund include not only state and federal fuel tax proceeds but also auto registration fees, airport fuel taxes, and, beginning this year, a $100 annual tax for electric vehicles (EVs). Needless to say, who pays for what has become somewhat blurred.

Louisiana’s fuel tax revenue is barely increasing and is likely to start declining as new cars must go farther and farther per gallon of gas (thanks to tougher federal fuel-economy mandates), more people replace conventional cars with hybrids that use less gas, and as electric vehicles become a larger and larger part of the vehicle population. Complicating the highway construction and maintenance problem is a huge recent increase in Louisiana construction costs, which Ms. Tairov’s piece puts at 88% over the past two years.

Her commentary also suggests that some of the roads and highways that are part of the state highway system could be devolved to local governments, which may well make sense but would likely not be easy, politically. She also suggests possibly deferring new construction projects for several years in case costs “come back down,” but that risks not paying for projects now only to face paying even higher costs three years from now. (Note, the long-term trend in highway construction costs as tracked by the Federal Highway Administration is annual increases averaging 5.72% per year from 2002 to 2019, with very few annual decreases.)

The most troubling suggestion in the piece is “un-dedicating the gas tax, placing those funds in the state’s general fund, and then funding DOTD like any other state priority.” In my 2018 book, Rethinking America’s Highways, I make the case for restoring the users-pay/users-benefit principle—i.e., strengthening the link between paying for and using roads and highways. The gas tax, of course, needs to be replaced with a user fee that applies to all vehicles regardless of how they are propelled. A congressionally-appointed national commission in 2009 studied an array of possible user fee mechanisms and concluded that by far the best way was to charge per mile driven.

When my Reason colleague Marc Scribner read the Pelican piece, he pointed out that, “Eliminating the users-pay principle and funding roads like any other general government obligation out of general appropriations has long been a goal of progressive smart-growth groups who believe they can more easily get their pet projects funded when road-user revenues aren’t dedicated to roads.”

I agree, and in my book I discussed a longer-term goal of making highways function more like other infrastructure such as water supply and electricity. Customers get a monthly bill showing how much they used, the rate per unit of use, and the amount due. The revenues go exclusively to the capital and operating costs of the utility in question.

A growing number of state DOTs have been carrying out pilot projects to simulate, with volunteer drivers and trucking companies, how a per-mile user fee system might work. There is no consensus yet on the best model, but Louisiana policymakers should be thinking about carrying out a similar pilot project.

» return to top

Questions About Tesla Semi’s 500-Mile Trip

The highly touted 500-mile run of a fully loaded Tesla Semi from Fremont to San Diego has raised a number of questions. As far as I can tell, only two minutes of a claimed eight-hour trip video have been posted on YouTube. The video shows only one pause for a bathroom break during that time period, which is suspicious, and not counting that break, if it really went 500 miles in eight hours, that’s an average speed of 62.5 miles per hour. Could there be zero congestion on I-5 (or any other freeways) for any eight-hour period in California?

Other questions include whether the Semi had a full load, weighed the claimed 81,000 pounds, and actually operated on a single battery charge for the whole trip. Autoevolution last month offered a critical assessment. There was no weighing of the truck, and the pallets carried in the trailer to simulate commercial freight loads were estimated at 34, each weighing 600 kilograms (or 1,323 pounds). Yet the video shows only a brief glimpse inside what appears to be a partially loaded trailer. Autoevolution’s estimate of the total gross weight is well below the claimed 81,000 pounds.

The May 2022 ATRI study “Understanding the CO2 Impacts of Zero-Emission Trucks” estimated that the total empty weight of a Class 8 Semi powered by batteries would be 32,016 lbs. Of that, the battery pack alone accounted for a bit over 17,000 pounds. The empty weight of a comparable diesel Class 8 was put at 18,216 pounds. Subtracting the empty weight from the targeted 81,000 gross weight yields a payload capacity of 62,784 pounds for the diesel but only 48,984 pounds for the battery-electric. Tesla has released no figures on either the Semi’s empty weight or the weight of its battery pack. Of course, it may be lighter than ATRI’s estimates, but it would be nice of Tesla to disclose such figures.

Further questions were raised in an article on Electrek on Dec. 16. Reporter Fred Lambert cited a Reuters interview with Pepsico VP Mike O’Connell about the company’s initial 36 Semis for its Frito-Lay division, 15 of them in Modesto and 21 in Sacramento. The Frito-Lay trips will average 425 miles, while trips hauling Pepsi soft drinks will average 100 miles. This suggests that potato chip loads will “cube out” (fill the cubic feet) long before they “gross out” (using all the available payload weight). So at best, it seems likely that the 500-mile run was simulating potato chip loads, not soft-drink loads.

Trucking companies will not make many serious fleet commitments without verifiable performance data. Flashy videos will not be enough.

» return to top

News Notes

PennDOT Finances Major Bridges P3 Project
Just before Christmas, the Pennsylvania Department of Transportation and a Macquarie-led consortium reached financial close on the $2.3 billion Major Bridges Program’s first phase. It will replace six major bridges: one on I-78, four on I-80, and one on I-81. Three other aging Interstate bridges will be addressed in a subsequent project. Because the state legislature last year changed the public-private partnership law to prohibit putting tolls on “existing” Interstate lanes (even though these projects will replace all those lanes), PennDOT is financing the project based on availability payments. The consortium put in $202 million in equity, and the financing includes $1.8 billion in tax-exempt private activity bonds (PABs), the demand for which was six times the amount sought.

Brent Spence Bridge Project Finally Moves Ahead
After more than a decade of local opposition to toll financing to replace the aging Brent Spence Bridge between Kentucky and Ohio, a plan to refurbish the existing bridge for local traffic and build a new (non-tolled) bridge for long-distance (through) traffic reached an agreement—thanks to in large part “free” money from taxpayers via Congress: $1.6 billion in grants from two new federal programs. The new 10-lane bridge will carry I-71 and I-75 across the Ohio River.

Louisiana Moving Forward on Major Bridge P3
After securing modest pledges of state and federal grant support, the Louisiana Department of Transportation & Development is expected to issue its long-awaited request for proposals for a long-term design/build/finance/operate/maintain P3 project this spring. The project will replace the aging I-10 bridge across the Calcasieu River. The estimated cost is $1.5 billion, with the feds committing $150 million and a state grant of $100 million. Tolls are expected to be a significant portion of the financing package, and the concession term is expected to be 40 to 50 years.

Gordie Howe Bridge Delayed Eight Months
The $5.7 billion Gordie Howe Bridge between Detroit and Windsor, Ontario, will not likely open to traffic until Aug. 2025, an eight-month delay. The main factor is delays on the Detroit side of the river, where a new interchange with I-75 is a significant part of the project, along with the bridge and ports of entry on both sides. The 1.5-mile, six-lane bridge will provide much-needed additional capacity for America’s single busiest commercial border crossing. The P3 consortium consists of ACS Infrastructure Canada, Fluor Canada, and Aecon Concessions. The public-sector partner is the Windsor-Detroit Bridge Authority.

Arizona Planning EV Charging “Along” Its Interstates
Arizona DOT plans to use $76.5 million in Infrastructure Investment and Jobs Act funding to add electric vehicle charging facilities along I-8, I-10, I-17, I-19, and I-40. The plan will upgrade eight existing charging stations and add 13 more, according to ADOT. They will be located at 50-mile intervals and no more than one mile from an Interstate offramp. It would have been more convenient for EV operators if the charging stations were located right on the Interstates, but federal law still prohibits any commercial services at Interstate highway rest areas.

Connecticut Truck Mileage Fee Began on Jan. 1
In addition to its diesel tax, commercial truckers using Connecticut’s highways as of Jan. 1 are being charged a per-mile fee, based on vehicle weight. The rates go from 2.5 cents/mile for trucks between 26,000 and 28,000 lbs. to 17.5 cents/mi. for trucks of 80,000 lbs. or more. While it is called a fee, because the proceeds are supposed to support the state’s Special Transportation Fund (to improve roads and bridges), it’s more accurately a user tax, analogous to the original state fuel taxes that were dedicated to highway purposes. And truck weight does correlate with the extent of pavement wear and tear.

Reports Question U.S. Electricity Net Zero by 2050
The Electric Power Research Institute released a report in September titled “Net-Zero 2050: U.S. Economy-Wide Decarbonization Scenario Analysis.” As summarized by Steve Milloy of the Energy & Environment Legal Institute, the report found that conversion to clean electricity plus direct electrification (of uses such as electric vehicles) is incapable of leading to U.S. net zero by 2050. Supporting this finding is a report from the North American Electric Reliability Corp. (NERC), “2022 Long-Term Reliability Assessment,” which found that fossil fuel plants are being removed from the grid too quickly to meet ongoing demand.

Jones Act Repeal Suggested by JEC’s GOP Members
In a 29-page report called “Policy Solutions to Reduce Inflation,” the nine Republican members of Congress’s Joint Economic Committee singled out both the Jones Act, which prohibits foreign-owned ships from transporting cargo between two U.S. ports, and the Foreign Dredge Act, which prohibits foreign dredge operators in U.S. harbors and waterways. Both serve to protect high-cost U.S. companies and prevent efficient delivery of shipping and dredging in this country. These were among a number of sensible suggestions for reducing inflation that should elicit bipartisan support.

Barone Spotlights State Population Winners and Losers
In a Dec. 28 column, the Washington Examiner’s Michael Barone drew on 2022 Census domestic migration data to identify the states gaining and losing the most population due to domestic migration. The three biggest population losers, according to Barone, were New York (3.3% out-migration), Illinois (2.2%), and California (2.2%) plus Washington, DC (down 3.8%). By contrast, the biggest population gainers were Florida (3.3%), South Carolina (3.2%), Texas (3.05%), and North Carolina (2.5%). Obviously, the pandemic and economy significantly impacted the trends, and it is too early to know if they are permanent, but policy analysis and media coverage of migration, housing, and infrastructure in these areas will be vital in the coming years.

EVs and Winter Weather
“Cold weather is zapping electric pickup truck range.” That headline appeared in Equipment World on Dec. 21. It added that range loss in cold weather is stirring up serious concerns among some electric vehicle users. Just sitting out in the cold overnight can deplete range by 20%. The North American Council for Freight Efficiency has found in cold-weather testing that “you lose 10% of range for every 10 degrees under 30 degrees Fahrenheit.” Even worse, the AAA Automotive Research Center in Southern California reports that electric vehicle range “dropped 57 percent…when the temperature was held steady at 20 degrees.” Both Ford and Rivian have advised users of their EVs to park them overnight in a garage, plugged in, out of freezing weather. I have seen no comparable data on hydrogen fuel cells in cold weather, probably because there are so few such vehicles in production or operation.

Miami-Dade County Scraps Monorail in Favor of People Mover
For a long-planned transit connection between Miami and Miami Beach, Miami-Dade County, which previously rejected the idea of extending its heavy-rail transit system across Biscayne Bay in November, also rejected the previously favored idea of a monorail to be developed under some kind of P3 agreement. Instead, the county is sticking with something they know: the slow-moving Metromover—a 1970s-era elevated people mover that circulates in downtown Miami. That will likely cost a lot less and will be compatible in operations and maintenance with the existing Metromover.

Hawaii DOT Favors Road Usage Charge for EVs
After having conducted a pilot project to test aspects of a per-mile charge for all vehicles, the Hawaii DOT now favors beginning the transition from per-gallon taxes to per-mile charges with a per-mile charge for electric vehicles (as is already the initial approach in Utah DOT’s ongoing program). Electric vehicles would pay 0.8 cents per mile initially, based on miles driven read from their odometers at annual vehicle inspections. The pilot project involved 2,000 volunteers, funded largely by a federal grant in 2018.

New Jersey Motorists Will Be Taxed for Amtrak’s Gateway Tunnel
Directors of the New Jersey Turnpike Authority approved the diversion of enough toll revenue to pay for the state’s 25% share of the cost of the $16 billion Gateway Tunnel project. New Jersey officials plan to apply for a federal railroad loan to cover the state’s cost, and diverted turnpike funds will be used to make monthly payments on the loan. This amounts to a $4 billion tax on Turnpike customers, not including interest costs. Where are the trucking associations and AAA on this?

Tesla Puts Video Game in Front of Drivers
Kelly Blue Book reported, without comment, the news that Steam Gaming will be added to Tesla’s Model S sedans and Model X SUVs from model years 2022 and 2023. The illustration shows “Cyberpunk 2077” on a huge Tesla screen, just to the right of the steering wheel. One hopes there is some kind of lockout to prevent a driver from playing such games while driving in “self-driving” modes that require hands on the wheel and eyes on the road. But even if there is, hackers will likely find ways to bypass the lockout.

Recommended Reading

• “By Abolishing Fares, Big Cities Embrace Transit’s Death Cycle,” Christian Britschgi
• “Automotive AI Is Making Both Cars and Drivers, Better,” Michael L. Sena

» return to top

Quotable Quotes

“Eliminating fares without otherwise improving service is unlikely to push very many drivers to take more trips via bus. Instead, evidence suggests that increased ridership will mostly come from people who already take the bus choosing to do so over biking or walking. That’s fine, but it doesn’t do anything to reduce congestion or emissions. In Talinn, the capital of Estonia, fare-free buses led to a 40 percent reduction in trips made on foot and reduced the number of car trips by just 5 percent. In Trenton, NJ and Denver, CO experiments with free fares likewise showed no change in car traffic, despite significant increases in ridership.”
—Jerusalem Demsas, “Buses Shouldn’t Be Free,” The Atlantic, Dec. 9, 2022
 
“The fact that Cruise’s test cars get stuck or Tesla cars crash when their Full Self-Driving systems are engaged indicates that we are still in the pre-commercial phase of automotive AI. But technical issues are only one, albeit important, part of the entire transformation of the automotive driving experience, especially when moving to automotive AI-based systems that have no interaction with humans for the driving task. Like a present which has many layers of wrapping, from the tissue paper around the present to the ribbon and bow on the box, automotive AI requires various layers to complete the basic technology.”
—Michael L. Sena, “Automotive AI Is Making Both Cars and Drivers Better,” The Dispatcher, Jan. 2023

“Do policymakers today have the stomach for the fight? Coming so soon after the fiscally austere 2010s, many are reluctant to tighten the tax-and-spending screws once again. Indeed, many politicians have gone the other way, and now seem uncomfortable with the notion that anyone should lose out from anything, ever. They are offering hundreds of billions’ dollars-worth of deficit-financed fiscal support that will fuel inflation, whether by subsidizing energy bills (in Europe), offering ‘cost-of-living payments’ (in Australia and New Zealand), or forgiving student debt (in America). Policymakers are thus ignoring the fundamental lesson of the 1980s. Fighting inflation is hard. It requires all hands on deck and immense courage over a long period of time. It is also, unfortunately, almost inevitable that some groups lose out, if only in the short term. As politicians run scared, the 2020s risk earning a special place in the history books, too—for failing to tame inflation.”
—Free Exchange columnist, “I’ll Do Things for You,” The Economist, Dec. 3, 2022

» return to top

The post Surface Transportation News: Priced managed lanes, a way to ruin a railroad, and more appeared first on Reason Foundation.

Docket No. FRA-2021-0032

87 Fed. Reg. 45,564

Due to the lack of evidence supporting a safety basis for this proposed train crew size rule and the likely environmental harms that would be generated if promulgated, the Federal Railroad Administration should withdraw the notice of proposed rulemaking.

The post No evidence to support train crew size regulation appeared first on Reason Foundation.

• Global study documents benefits of highway P3 concessions
• D.C. area express lanes network’s celebrations and concerns
• Transit’s post-pandemic ridership decline and fiscal cliff
• Electricity grid not prepared for electric big rigs
• Major benefits of advanced driver assistance systems
• The automated vehicle implosion
• Feedback on gas stations and EV charging stations
• News notes
• Quotable quotes

Global Study Documents Benefits of Highway P3 Concessions  

A global assessment of the benefits and costs of 21 toll-financed highway public-private partnership (P3) projects in nine developed countries finds benefits exceeding costs for the 16 projects that have been completed and are in operation. The benefits thus far total $29 billion, while the costs, including costs for projects still under construction, total $23.5 billion. This suggests that over the full life of these 21 concessions, benefits will likely far exceed costs.

The study was carried out by transportation economics firm Steer, based on project data provided by Cintra, the surface transportation arm of Spanish infrastructure company Ferrovial. The report, dated Oct. 2022, is “Economic Impact of Cintra Assets” and is available online.

This is the first global study I know of that uses a standard methodology to assess benefits so that it permits fair comparisons of projects in the nine countries. The benefits are assessed in the following categories:

• Expenditure impacts, assessed via standard input/output models;
• User benefits: travel time savings, reliability increase, reduced vehicle operating costs;
• External benefits: increased safety, reduced emissions; and,
• Wider economic benefits: urban agglomeration benefits (increased economic productivity).

I’m not a fan of input/output models in general because they often reflect local impacts from a project being done in one part of a country rather than in another. But since they are widely used, and the Steer study followed mainstream U.S. and Organisation for Economic Co-operation and Development (OECD) procedures, I report the results here for completeness. The economic impact from the $23.5 billion in project construction and operations to date totaled $60.8 billion and 334,500 full-time-equivalent job years.

Far more interesting to me are user benefits, external benefits, and agglomeration benefits. The projects analyzed include four managed lanes projects in the United States, three U.S. urban toll roads, three phases of a new Canadian urban toll road, eight new interurban toll roads in Europe and Australia, and one new toll network in the Azores. In each of these cases, user benefits were assessed by comparing travel time, reliability of travel time, and reduced vehicle operating cost for those using the new toll facilities compared with existing routes they would have used had the new capacity not been built. Induced demand was estimated and assessed separately. All assessments included both light and heavy vehicles.

External benefits were estimated for both road safety and emissions changes. For the safety calculations, project and no-project accident rates were estimated, reflecting that more of the trips in the no-project alternatives would have been undertaken in more-congested conditions and with a larger fraction on non-limited-access roadways. Emissions estimates followed the U.S. Department of Transportation (DOT) 2021 emissions benefit/cost guidance and assessed CO2, nitrogen oxides, and PM 2.5. Emission rates were based on Motor Vehicle Emission Simulator (MOVES) 3 model for the U.S. cases and comparable government models for Australia, Canada, and Europe.

Wider economic benefits reflect growing research by economists on urban agglomeration impacts. In brief, shorter travel times between homes and jobs enable more positive-sum transactions to take place between employers and prospective employees, and many urban economic studies have quantified the impact of this on the economic productivity of large urban areas. The United Kingdom’s Department for Transport routinely does this kind of analysis; alas, to the best of my knowledge U.S. DOT and state transportation departments do not.

Table 4.3 in the report summarizes the socioeconomic impacts of the 16 projects that had been in operation for at least a year by the end of 2021. The results were as follows:

Would all those benefits have occurred if these projects had been funded conventionally by state legislators and implemented via traditional design-bid-build or design-build contracts?

Perhaps, but let’s consider some key differences. These public-private partnership (P3) projects employed long-term financing via toll revenue bonds and investor equity. This means they had to meet a market test of generating enough traffic over the 35-to-99-year terms of the P3 agreements to pay off the bonds, provide a return to the equity investors, and cover operating and maintenance costs for the entire duration of the agreement. With conventional procurement, there would be no market test to guard against boondoggles and no guarantee against deferred maintenance, which is quite common across the United States.

Moreover, in today’s world, when federal and state fuel tax receipts don’t come close to covering the capital and operating costs of large-scale highway projects, an increasing share of the federal support is borrowed, adding trillions to the national debt (e.g., the entire cost of the Infrastructure Investment and Jobs Act legislation). That is not a sustainable way to fund highways.

I see the new Steer report as a strong validation of the toll-financed long-term P3 model. It is working well in Australia, Europe, and, thus far, to a limited extent in the United States. The long-term P3 could do far more in the U.S. if legislators and state transportation departments fully researched and utilized it.

» return to top

D.C. Area Express Lanes Network: Celebrations and Concern

The emerging network of priced managed lanes in the Washington, D.C., metro area celebrated two milestones last month. The first link in the network—the I-495 express lanes project financed in 2007—celebrated its 10th anniversary of operations. And the newest major link in the network—I-66 Outside the Beltway—had its official ribbon-cutting ceremony on Nov. 29. Altogether, this Virginia-based network now extends over 84 route miles.

All but one small piece of the network (I-66 inside the Beltway) has been financed, developed, and operated under long-term design-build-finance-operate-maintain (DBFOM) public-private partnership (P3) concessions. The original I-495, I-95, and I-395 projects were developed and continue to be operated and managed by Transurban. The new I-66 Outside the Beltway lanes are the latest U.S. express toll lanes from Cintra, teamed with Meridiam, who also worked together on major P3 managed lanes projects in operation in Dallas and Fort Worth.

The original I-495 project began as an unsolicited proposal to Virginia DOT (VDOT) from Fluor, under Virginia’s Public-Private Transportation Act. As I recounted in my book Rethinking America’s Highways, the company, later joined by Transurban, proposed a largely self-funded project to add two express toll lanes each way to the western half of the I-495 Beltway instead of the Virginia Department of Transportation’s long-unfunded plan to spend $3 billion to add high-occupancy vehicle (HOV) lanes to that portion of the Beltway. The project was financed at $2.3 billion, of which the state contributed only 21%. The new lanes opened 10 years ago. They enabled faster and more reliable trips for paying customers, enabled three-person carpools to use these faster lanes at no charge, and facilitated express bus service and new park-and-ride lots. The success of these initial projects cleared the way for subsequent managed lanes on I-95 and I-395, which Transurban also won. As of the tenth anniversary of the original project, 75% of greater Washington, D.C., area drivers have used the express lanes, up from 62% in 2021.

The $3.5 billion Cintra/Meridiam “Transform 66” project was the first Virginia express lanes project to be entirely privately funded, with zero state investment. It was financed in 2017 with a Transportation Infrastructure Finance and Innovation Act (TIFIA) loan, private activity bonds, and an unprecedented 44% equity investment. It has substantially rebuilt 22.5 miles of I-66, added three new park and ride lots, and includes new communications infrastructure to facilitate emerging connected-vehicle capabilities. As with the other links in the express lanes network, 3-person HOVs will use the new lanes at no charge, as will buses. To be consistent with the HOV-3 policy on the emerging network, on Dec. 5, the occupancy requirement on I-66 inside the Beltway (operated by VDOT) will change from HOV-2 to HOV-3.

There remains one missing link in VDOT’s D.C. metro area express lanes network: I-495 between I-95 and the Woodrow Wilson Bridge. VDOT hopes to add express lanes on that corridor, as well, potentially crossing the bridge and extending to the MD 210 interchange. Details about the ongoing I-495 Southside Express Lanes study are on the VDOT website.

The one discordant note amidst the Virginia celebrations is the possible cancellation of the first express toll lanes on the Maryland side of the Potomac—the Op Lanes Maryland project that would rebuild the American Legion Bridge, adding express lanes to the new bridge and to I-495 as far as I-270 and on I-270 as far north as I-370. The concession agreement with the Macquarie/Transurban team has not been finalized due to nearly a year-long delay in issuance of the federal record of decision (ROD) giving the project federal environmental clearance. The draft concession agreement must then survive a vote of the state’s Board of Public Works (BPW), which has new members thanks to the November election. Maryland Gov.-elect Wes Moore has expressed reservations about the project, as has the incoming controller. Moore and the controller are two of the BPW’s three members. It would be tragic if the Maryland half of the greater Washington, D.C., metro area turned its back on the demonstrated success of express lanes on the Virginia side of the Potomac.

» return to top

Facing Transit’s Fiscal Cliff
By Baruch Feigenbaum

The drop in transit ridership resulting from COVID-19 pandemic-induced commuting changes has decimated transit agencies’ financial situations. In late 2020, as many cities continued to ban or restrict various in-person activities, transit ridership was down to 5% of its pre-COVID total. While transit ridership has now recovered to 60% or more of pre-COVID levels, it is still causing financial problems for most transit agencies. Two recent articles sounded the alarm on concerts about the financial situations and long-term ridership hopes.

In a Center Square article by Elyse Apel, Tom Gantert, and Brett Rowland, whose title is the main thesis, “As Transit Fares Plummet, Federal Money Increases 95%,” the writers detail how transit’s farebox recovery rate has declined from a paltry 32.3% in 2019 (before the pandemic) to 18.4% in 2020 and 12.8% in 2021. The 2022 numbers are not yet available but are forecast to fall far short of 2019’s numbers. To offset transit’s ridership losses, the federal government has provided transit agencies with $72 billion in four separate bailouts. In 2021, for example, transit agencies used this spending for $13.1 billion on operational expenses. Yet, for a variety of reasons, this cash windfall has failed to restore transit ridership to pre-COVID levels.

The farebox recovery ratio for operational expenses, which excludes capital spending, is a big problem. In 2019, farebox revenue covered almost half of all transit operating expenses. In 2021, the number was only 19%.

With Democrats retaining the U.S. Senate but Republicans taking control of the House of Representatives in 2023, the transit bailouts will likely end. Yet most transit agencies do not seem to know what their ridership will be in the coming years or have plans to fully fund their systems.

In the second of a multi-part article titled “Looking to the Horizon: How Agencies are Anticipating the Mass Transit Fiscal Cliff,” Eno Center for Transportation’s Garett Shrode, a former Reason Foundation intern, found that transit agencies budgeting multiple years in the future are coming to widely different conclusions. For example, Bay Area Rapid Transit (BART) uses three ridership models: a base scenario that assumes 70% of pre-pandemic ridership, a downside scenario that assumes 60% of pre-pandemic ridership, and an upside scenario that assumes 80% of pre-pandemic ridership. For the 2026 fiscal year (FY), the upside scenario predicts no budget deficit, the middle scenario forecasts a $118 million deficit, and the downside predicts a $200 million deficit. And the deficits for the middle and downside scenarios grow by more than 50% between 2026 and 2032.

Other transit agencies provided just one forecast figure. And they were all negative. Southeastern Pennsylvania Transportation Authority (SEPTA) predicts a $63 million budget deficit in 2026, growing to $283 million for FY 2028. Washington Metropolitan Area Transit Authority (WMATA) predicts a $527 million deficit for 2025. New York’s Metropolitan Transit Authority (MTA) predicts a $2.26 billion deficit for 2025. MTA still has a massive deficit even with toll revenue (from MTA bridges and tunnels), and future fare increases included. 

For funding, many transit agencies’ strategies seem to rely on some combination of increasing fares, reducing service levels, increasing sales taxes and/or general fund revenue.

This lack of a comprehensive strategy makes agencies susceptible to plans that exacerbate budget challenges. For example, the Washington, D.C. City Council recently voted to make all bus transit free in the city, using general fund revenue to pay for this service for all D.C. residents regardless of their income levels. Free transit is a growing movement despite the fact that none of the dozens of reports on it has ever found free transit to be a good idea. Most importantly, when an economic recession occurs, tax revenues go down, budgets are hit and general fund revenue to WMATA gets cut, who is going to make up the revenue? What politician is then going to propose charging for something that has been free?

Given the information and data in the Center Square and Eno pieces, what do transit agencies need to do? First, they must take steps to reduce their need for subsidies. Even before the pandemic, farebox revenue made up less than one-third of transit agency operating and capital expenses. Most transit agencies need to charge more for rail service, which tends to be used more by affluent riders and provide vouchers to customers who cannot afford the higher fares. Agencies need to advertise more on transit vehicles, in stations, and in transit-oriented developments. 

Second, agencies should focus on the customers they have, not the customers they want. In the Washington, D.C., metro area, the decision to build the Silver Line and cut bus service was made in hopes of luring choice riders—those with access to an automobile—out of their cars. The decision has increased costs because the added expense of repaying the capital costs for the Silver Line will take decades. But it hasn’t significantly increased choice ridership since trains are slower than driving and have long headways, the intervals between trains. Further, it is typically more justifiable for transit agencies to subsidize transit rides for working-class commuters than for a rider who drives a BMW.

Finally, in the long term, the entire transit industry needs to be rethought. More transit services should be contracted to improve efficiency and reduce costs. Metro regions should have mobility management agencies. Transit agencies also need to conduct a rigorous evaluation of their service quality. Many transit agencies are failing their customers today, and they were failing them before the COVID-19 pandemic. If transit agencies don’t start making big changes to adapt to changing work-from-home and travel patterns by the year 2030, no level of subsidies will be enough for some of them. 

» return to top

Electricity Grid Not Prepared for Electric Big Rigs

Electric utility company National Grid released a study on requirements for electric vehicle (EV) charging stations along long-distance highways, with a focus on heavy trucks. The finding that got the most attention in trucking circles is: “The charging capacity required to supply a large passenger vehicle travel center/truck stop will be roughly equivalent to the electric load of a small town.” 

The Electric Highways Study was conducted by National Grid along with Calstart, Geotab, RMI, and Stable Auto. Its geographic focus was New York and Massachusetts, but the implications are national. The report reached six main conclusions:

1. A typical highway electric vehicles charging site will eventually need 20+ fast chargers.
2. While light-duty EVs (e.g., cars and SUVs) will drive electric load increases in the near term, medium/heavy electric vehicles will greatly increase charging needs in the medium/long term. By 2045, over 75% of average daily energy needs will likely come from medium/heavy vehicles.
3. The high levels of demand will require connections to the high-voltage transmission system at many highway fast-charging sites.
4. Hence, where possible, locate highway EV chargers near existing transmission lines.
5. Build the grid interconnection once, and build it right, rather than planning on a series of upgrades.
6. Due to long timelines for upgrading transmission lines, preparation for large sites should begin immediately.

Much of this strikes me as logical, given the underlying premises. But there are two implicit premises that the report fails to consider. First, is it conceivable that the United States will have enough electricity capacity to meet the projected need for an all-electric motor vehicle fleet by 2050 or 2060? Second, is battery electric the most cost-effective approach for heavy, long-distance trucks?

I’ve written about each of these questions in previous newsletters. In the Oct. 2022 issue, I cited an article in The Dispatcher drawing on calculations by energy analyst Roger Andrews. His analysis of the planned decarbonization energy transition in the United States finds that in addition to needing to replace the 61% of electricity generated by fossil fuels, this country would need an additional 49% of zero-carbon electricity to handle the conversion of all surface transportation to electricity. That means replacing 110% of our current electric generating capacity over something like four decades. It is fairly certain that this is not doable. The urgency the Electric Highway study calls for is not as urgent if the planned goal is impossible to accomplish.

In the June issue, I reviewed a detailed study on the electrification of the Class 8 heavy truck fleet carried out by the trucking industry research organization American Transportation Research Institute (ATRI). Its researchers built a model of the life-cycle CO2 emissions of a Class 8 sleeper cab truck with three alternative propulsion systems: internal combustion engine (ICE), battery electric (BEV), and hydrogen fuel cell (FCEV). The study included carbon footprint estimates of vehicle production, energy production and consumption by the truck, and vehicle disposal and recycling. The conclusion was that the ICE’s overall carbon footprint was 3.7 million pounds, the BEV’s was 2.6 million, and the FCEV’s was 2.0 million pounds. In addition, due to the enormous weight of the batteries in the Class 8 BEV, the payload capacity of that big rig was significantly less than that of the FCEV. So hydrogen fuel cells seem more likely to be the way to electrify big rigs.

To be sure, there is far less investment going into fuel-cell Class 8 trucks these days than into BEV Class 8’s. And there are all kinds of questions about the infrastructure needed to refuel FCEVs. But if the electricity needed for an all-BEV trucking future is unlikely to be available in the next 40 years, more research and development on both Class 8 FCEVs and the hydrogen infrastructure they will need would certainly be wise.

» return to top

Major Benefits of Advanced Driver Assistance Systems
By Marc Scribner

In recent years, much of the public conversation on vehicle automation has focused on highly automated self-driving capabilities. While these technologies offer great promise to enhance safety, productivity, and quality of life, the proliferation of lower-level automation technologies that assist rather than replace human drivers is already impacting the driving landscape. Last month, new research conducted by MITRE Corporation at the direction of the Partnership for Analytics Research in Traffic Safety (PARTS), a group made up of the National Highway Traffic Safety Administration and several automakers, was released and found sizeable safety benefits are already being realized from advanced driver assistance systems (ADAS) introduced in recent years.

The MITRE/PARTS study examined crash data on 93 vehicle models from model years 2015 to 2020 that were involved in police-reported crashes in 13 states from Jan. 2016 to Aug. 2021. It examined the following ADAS features already on the market: forward collision warning, automatic emergency braking, pedestrian automatic emergency braking, lane departure warning, lane keeping assistance, and lane centering assistance.

The study found sizable benefits of forward collision warning by itself, with a 16% reduction of front-to-rear crashes and a 19% reduction in front-to-rear crashes involving injuries for vehicles equipped with only forward collision warning. However, it did not find a statistically significant reduction of single-vehicle road-departure crashes for vehicles equipped with only lane departure warnings.

The safety benefits dramatically improved when ADAS warning features were combined with automated features. Front-to-rear crashes with vehicles equipped with both forward collision warning and automatic emergency braking were reduced by 49%, with a 53% reduction in crashes involving injuries. When lane departure warning was combined with lane keeping assistance, all single-vehicle road departure crashes and just those involving injuries were reduced by 8% and 7%, respectively.

The MITRE/PARTS study did not find statistically significant reductions in crashes or crash severity for pedestrian automatic emergency braking, but this may be due to the smaller number of incidents and lower market penetration compared to rear-end vehicle crashes and automatic emergency braking.

Research from the Insurance Institute for Highway Safety (IIHS) published earlier this year suggests pedestrian automatic emergency braking may not yet perform well in the types of conditions where it would do the most good—at night with poor roadway lighting. IIHS found that pedestrian automatic emergency braking reduced pedestrian crashes by 27% in all lighting conditions. However, when it examined only nighttime crashes on unlit streets, it found no difference between vehicles equipped with and without this feature.

The lack of nighttime safety benefits of pedestrian automatic emergency braking may have to do with the limitations of the sensors involved. Most of these systems involve cameras alone, with better performance coming from sensor stacks that contain both cameras and radar. However, IIHS cautions not to overweight their results because pedestrian automatic emergency braking was a new ADAS feature when they conducted their tests, and automakers’ latest iterations may have improved nighttime performance.

With respect to policymakers interpreting these promising early results on ADAS technology performance, I suggest there are three main takeaways. First, they should recognize the value of public-private partnerships such as PARTS in keeping industry and government on the same page. At the early stages of technical development, information sharing can help direct both future research projects and policymaker attention.

Second, policymakers should appreciate that various vehicle automation technology developed by the private sector is already producing safety benefits on the roads today. The standards and test procedures being developed for sensors and ADAS software may help inform future work on highly automated self-driving technologies.

Third, and most importantly, policymakers should avoid overly prescriptive regulatory interventions, such as mandating that current ADAS technologies be equipped on all new vehicles. As the pedestrian automatic emergency braking nighttime performance example makes clear, these new technologies are rapidly iterating and improving. Mandating yesterday’s technology in perpetuity would risk short-circuiting ADAS innovation and potentially delay better technologies from coming to market. Technology lock-in and path dependence at this early stage could mean more fatalities, injuries, and property damage that could otherwise have been prevented. If policymakers do move forward with mandates, they must take care that any minimum performance standards do not prevent better new technologies from replacing inferior old technologies.

ADAS and vehicle automation, in general, remain in the early stages of development. The performance results to date are very encouraging and are bright spots in otherwise gloomy news about recent road safety trends. But policymakers must avoid taking counterproductive actions that would limit innovation and the ensuing safety benefits.

» return to top

The Automated Vehicle Implosion

November was not a good month for autonomous vehicle (AV) startup companies. The biggest news was Ford and Volkswagen (VW) shutting down their joint venture AV company, ARGO AI, suffering a $2.7 billion write-off. Despite two previous Ford CEOs having promised self-driving cars would be on sale by 2021, ARGO was nowhere near that goal. Ford and VW each said they would take on some ARGO staff to work on things like Ford’s Level 3 Blue Cruise system.

General Motors’ Cruise venture is still going forward, with a small number of AVs operating at night in part of San Francisco, but Morgan Stanley’s Adam Jonas told The Wall Street Journal that “he was no longer assigning any value to GM’s Cruise driverless-car business in his valuation of the automaker’s enterprise value.” Honda announced on Dec. 1 that it will shift its focus to partially automated vehicles, noting that fully autonomous vehicles are not ready for prime time. Honda is an investor in GM’s Cruise, in addition to doing its own vehicle autonomy work.

Bloomberg published an article headlined “The Auto Industry’s $75 Billion Bet on Autonomy Is Not Paying Off.” Among the developments the article cited was the stock price of AV startup Aurora having dropped from $17.11 in Nov. 2021 to just $1.75 a year later. Several years ago, Intel purchased Israeli startup Mobileye for $15.3 billion but took it public this fall expecting a valuation of $50 billion; it ended up at $21 billion.

Even Waymo, with what has appeared to be unlimited backing from parent company Alphabet (formerly known as Google) and with robotaxis providing limited service in Phoenix, seems to be hitting the pause button. Its co-CEO, Tekedra Mawakana, told the Wall Street Journal’s Tech Live conference in October that vehicle automation “is really about being patient in the learning . . . This is a really long-term opportunity.” She went on to say that lower levels of automation could be achieved in coming years, but that Level 4 could still be years away. WSJ reporter Sebastian Herrera went on to say, “The technology has been beset by high costs, regulatory hurdles, and slower advancements than expected. Now, experts aren’t sure when people will be able to purchase autonomous vehicles.”

I think another factor was an avalanche of venture capital that has poured into startup AV companies during the years when interest rates were near zero. That made speculative ventures look more attractive than was ever likely to be the case. The same phenomenon has driven billions into highly speculative electric vertical take-off and landing (eVTOL) startup companies, hoping to provide affordable air-taxi service. A handful of those might emerge with viable aircraft and workable business models, but it’s still too early to tell.

» return to top

Feedback on Gas Stations and EV Charging Stations

Last month’s lead article on the future of gas stations as electric vehicles emerge generated more than usual feedback. Ethan Elkind of the University of California-Berkeley pointed out that with extensive research and development money going into improved batteries, the recharging times assumed in the article might come way down, a reasonable point. Were the average recharging time to match the average refueling time at a gas pump, the one-to-six ratio of acreage needed for EV charging stations would get closer to one-to-one. He added that a bigger hurdle for gas stations’ survival may be the availability of charging overnight at home, at least for those who have garages and shell out for their own charging equipment.

Transportation consultant Richard Mudge made a similar point about home-garage chargers handling some of the demand, unlike the case for conventional vehicles where home refueling isn’t an option. As a Tesla owner, he reported rarely needing to stop for more than 20 minutes at a Tesla Super Charger; he also reported that he pays about the same at a Tesla Super Charger as he would pay to refuel at a gas station.

Finally, several readers pointed out a math error in the calculations in the article. The one-to-six ratio remained the same, but the numbers served per day were incorrect. The corrected numbers are 2,016 cars per day for the gas station and 336 cars a day for an EV station occupying the same acreage. Those numbers have been corrected in the online edition.

» return to top

News Notes

New Study—Freight Rail Deregulation: Past Experience and Future Reforms
My colleague Marc Scribner’s new Reason Foundation policy brief published today examines “the history of economic regulation of the U.S. railroad industry, discusses emerging regulatory threats, and recommends reforms policymakers can enact to ensure freight rail remains on a strong competitive footing going forward.” You can find the full report here and a short overview here.

I-81 Viaduct Tear-Down Halted by Lawsuit
One of the first urban Interstate projects approved by the Federal Highway Administration to be torn down and replaced by a boulevard—I-81 through downtown Syracuse, NY—has been put on hold. A lawsuit filed by “Renew 81 for All” won an injunction halting initial demolition on Nov. 10. Oral arguments are set to begin in state court on Jan. 12. The plaintiffs object to the “community grid” planned to replace the Interstate and find fault with the environmental review which they say did not consider alternatives with fewer negative impacts on traffic, environment, and nearby communities.

Colorado DOT Rejects I-25 Express Lanes P3 Proposal
CDOT’s Colorado Transportation Investment Office (CTIO) has rejected a $1 billion proposal from global toll road company Roadis to add two express toll lanes each way to a 21-mile stretch of I-25 between Denver and Fort Collins. The only reason given by CTIO was that the proposal failed to pass its CDOT review panel. But Public Works Financing reports that the proposal likely failed due to a new policy from the Colorado Transportation Commission that calls for shifting significant funding from highways to transit projects in the name of reducing greenhouse gas emissions. In September, the Denver metropolitan planning organization (MPO) cut two planned highway expansion projects from its long-range plan.

Pennsylvania Major Bridges P3 Project Back on Track
PennDOT was forbidden by legislation passed earlier this year from using new toll revenues to pay for the replacement or rebuilding of nine major Interstate highway bridges. Inframation News (Nov. 30) reported that the agency has shifted from a revenue-risk to an availability-payment P3 model, enabling the project to proceed. Last month, the state issued $1.9 billion in bonds to substitute for the unavailable toll revenue. The selected P3 consortium, led by Macquarie, is continuing with pre-development work. As of now, the project includes six of the original nine bridges, all on Interstate highways.

Miami Expressways Get a Rating Agency Vote of Confidence
Moody’s Investors Service affirmed its A3 rating on the toll revenue bonds of the Miami-Dade Expressway Authority (MDX) last month and revised the outlook from negative to stable. This good news reflects MDX’s success thus far in litigating against a 2019 state law that sought to abolish MDX and replace it with a state-run toll agency. MDX’s litigation success is based on Miami-Dade County’s home rule authority. Voters there last month approved a ballot measure that would require a popular vote to permit a state take-over of its expressways, airports, or seaport.

$2.7 Billion Harbor Tunnel Going Forward in Sydney
The second stage of developing the new Western Harbor Tunnel in Sydney moved forward with the award of a $2.72 billion contract to Spanish developer Acciona. The 6.5 km tunnel will be excavated beneath the seabed of Sydney’s harbor via a tunnel boring machine (comparable to the Port of Miami tunnel project, but much longer). The project is being developed by the New South Wales government, but as with several other such projects, it is considered a candidate for privatization after it is completed, according to Inframation News.

West Virginia Turnpike Travel Plazas Makeover
Following the lead of other major turnpikes (in Florida, Indiana, New York, etc.), the West Virginia Turnpike last month announced a $152 million program to upgrade its three service plazas. They will have multiple food outlets, expanded truck parking, a convenience store, and EV charging stations. The Parkways Authority has studied the successful (typically 30-year) public-private partnerships used for upgrades by other toll roads. It has held discussions with provider Areas USA and plans to release an RFP for reconstruction of the first plazas by early next year,

Musk Tunnels Going Forward—or Not?
The Wall Street Journal recently ran a lengthy front-page article reporting that a growing number of municipalities that have had discussions about new tunnels with Elon Musk’s Boring Company are dismayed by the company’s lack of follow-through. Two days later Inframation News reported that Boring Company and the Alamo Regional Mobility Authority in San Antonio are in active discussions about their plans for a tunnel linking downtown with the airport. However, the RMA now wants the project to be done in two steps: an initial one-mile tunnel linking downtown to its Pearl District, to be followed (if successful) by extending the tunnel to the airport. The plan continues to rely on Boring Company paying all construction costs, which it hopes to recover from customer fares.
 
EVs Are More Damaged in Crashes
Insurance company AXA Switzerland conducted crash tests and data analysis this year and concluded that EVs yield more expensive damage claims from collisions than regular cars, for two reasons. First, because they can accelerate faster than conventional cars, drivers may drive them more recklessly. Second, due to their increased weight—typically about one-third more than a comparable non-EV—their damage from a crash is greater. AXA also reported statistics which “show that drivers of electric cars cause 50 percent more collisions with damage to their own vehicles than drivers of [cars with] conventional combustion engines.”

Tesla Announces First Class 8 Truck Deliveries
On Dec. 1, Tesla delivered to Pepsico an undisclosed number of its Semi, a Class 8 tractor-trailer with a reported range of up to 500-miles at gross weight of 82,000 pounds. Pepsico said they would have 15 Semis in place at their Frito-Lay facility in Modesto, CA, by year-end. Tesla has said it will produce 50,000 Semi trucks in North America by 2024. Tesla lists the vehicle’s energy consumption at 2 kWh/mile and its drag coefficient at 0.36, about half that of a conventional diesel Class 8 rig.

Four Teams Lining Up for Puerto Rico Toll Road P3 Leases
Inframation News reported last month that “at least four” teams have submitted their qualifications for long-term P3 concessions of a bundle of four state-run toll roads. The three the newsletter identified are Abertis, Plenary Group, and Sacyr. The state P3 Authority has estimated the value of the long-term lease at as much as $2.5 billion. The toll roads total 622 lane-miles, with PR-52 generating the majority of the annual toll revenue.

North Carolina Express Toll Lanes Attract Interest
While the Charlotte-area MPO has not yet decided to recommend a near-term P3 procurement rather than a farther-off NCDOT procurement of new express toll lanes on I-77 between the city and the South Carolina border, the possibility of a competitive P3 procurement has led to expressions of interest from other potential developers (though no names have yet surfaced). NCDOT studies of express lanes for that corridor date back as far as 2010.

GM Seeks to Operate New Driverless Vehicle in San Francisco
GM’s Cruise division has developed a driverless shuttle without any onboard driver controls. Named “Origin,” the vehicle seats four. Cruise has asked the state motor vehicles department for a permit to carry out test runs of Origins at night in a limited area of San Francisco. The company’s existing robotaxi service in the city operates only at night, and those vehicles have ordinary on-board controls, though they now operate without a safety driver on board. The Origin is Cruise’s first vehicle designed from scratch to be operated without a driver on board.

Cincinnati Selling Its Freight Railroad
In an example of asset recycling, Cincinnati is selling its Cincinnati Southern Railway (CSR) to Norfolk Southern, one of the major Class 1 railroads. CSR extends 337 miles connecting Cincinnati to Chattanooga, TN. CSR is operated by a subsidiary of Norfolk Southern under a lease that expires in 2026. The sale of the city-owned railroad is expected to yield the city $1.62 billion.

Home Buyers Moving Farther from Jobs
Data from the National Association of Realtors released last month show that the medium distance people moved from their previous residence was 50 miles in the year ended June 30, 2022. That’s a huge increase from the previous median of 15 miles (over the previous five years). This change reflects the trend to home-based work and the large consequent decline in mass transit usage.

To Hyperloop or Not?
Politico reported (Oct. 23) that Transportation Secretary Pete Buttigieg thinks hyperloop is “super interesting” but he doesn’t think the federal government should subsidize it. The same article noted Elon Musk’s April comment that his Boring Company will “attempt to build a working hyperloop,” though no one else has succeeded—and that Musk several years ago disavowed any interest in developing the idea.

Correction to Last Month’s Issue
Reader Sam Schwartz spotted an error in last month’s News Note about record sales of gasoline in fiscal year 2022. Drawing on a report from Eno’s Jeff Davis, the note said that a record 6.8 billion gallons were sold in FY 2022. What it should have said was that the 2022 total was 6.8 billion gallons more than were sold in 2021. We apologize for the error, which was ours, not Jeff’s.

» return to top

Quotable Quotes

“The delay of the [Maryland] OP Lanes concession into a new administration is especially striking because the project had such a strong democratic mandate. Governor Hogan actually proposed the initiative before his second term as governor, then campaigned on the initiative when he was up for re-election. Hogan then won re-election by a 12-point margin in a historically blue state. Even more striking is that Hogan made infrastructure investment, and the OP Lanes initiative in particular, the centerpiece of his administration. Can a project with that much democratic support really be delayed by a small, vocal, well-resourced opposition for the entirety of a governor’s term?”
—Michael Bennon, “Maryland OP Lanes Commercial Close Delayed,” Public Works Financing, Nov. 2022

“I was at a conference recently where a representative of a major Commonwealth government unit tasked with assessing the validity of benefit/cost assessments for projects said they green-lit a major road project in Australia’s second-largest city, though it had a benefit/cost ratio of 0.7, because . . . honestly, I am not sure why, something maybe about benefits that weren’t included in the benefit/cost analysis? So one must call BS on this. If there are other benefits, monetize them. Implicitly, the other benefits were worth more than 30% of the cost of the project overall if full benefits exceeded full costs. But if they are so squirrelly that one cannot monetize them, why? If practice does not incorporate full benefits (and full costs), again, why? I am as skeptical of benefit and cost practice as anyone, but I still think we should do things (and only do things) where the benefits are greater than the costs. We should, of course, debate what are the benefits, the categories of benefits, their value if realized, and the likelihood of them being realized. Similarly with costs. But if you insist something is a benefit, or a cost, demonstrate it. Otherwise, we can just follow politicians’ whims—and that is what B/C analysis often devolves into, contorting ‘facts’ into a nice rhetorical package to satisfy a politician looking for votes or dollars which has been green-eyeshade-washed.”
—David Levinson, “Benefits Should Outweigh Costs,” Transportist, Dec. 2022

“What happened to the goal of ‘walkable cities”? Back in 1972, when I finished my graduate studies in architecture and urban planning, the accepted view on city mobility was that the sidewalks were for pedestrians, and the streets were for cars, taxis, trucks, buses, motorcycles, and bicycles. Sidewalks were not extensions of streets or the adjoining buildings. They were meant to be walked on, not to be cycled on or for parking bicycles, or to be used as additional seating for restaurants or additional display space for shops. It was not accepted practice to place signs in the path of pedestrians. . . . In the U.S. and continental Europe, pedestrians could not expect cars to stop automatically at crosswalks unless there were red lights, but if you did have a walk signal, you didn’t have to worry about cyclists and e-scooterists ignoring the red lights in both directions and sending you to the hospital—or worse.”
—Michael Sena, “Sidewalks: Refuge, Promenade, Chaos Strip,” The Dispatcher, Dec. 2022

» return to top

The post Surface Transportation News: Benefits of highway P3 concessions, transit ridership, and more appeared first on Reason Foundation.

Railroads were the first industry to face national industrial regulation, beginning with the Interstate Commerce Act of 1887. In the early 20th century, the common carrier rules imposed on railroads were applied in a similar fashion to motor carriers, pipelines, and telecommunications. The stringency of these rules on freight rail gradually increased for two generations despite vast changes to the economic landscape that resulted in growing competition from less-regulated modes of transportation.

By the middle of the 20th century, economic regulation began to take its toll on the railroad industry, favoring its fast-growing competitors in highway trucking and passenger aviation. Facing the imminent collapse of rail as a viable mode of freight transportation in the U.S., Congress began reducing harmful economic regulation of the industry in the 1970s, culminating in the Staggers Rail Act of 1980.

Four decades after partial deregulation, U.S. freight railroads are now the most extensive and productive in the world, but new competitive and policy threats have appeared on the horizon. Part 2 of this report surveys the history of economic regulation of the U.S. railroad industry. Part 3 examines the results of partial freight rail deregulation. Part 4 details emerging threats and recommends reforms to ensure the long-run productivity and viability of transporting freight by rail.

The U.S. railroad industry’s regulatory experience offers an important cautionary tale for proponents of additional regulation of the economy. History and practice show that even the best-intentioned regulations—those carefully seeking to balance the interests of the parties involved—can lead to distorted markets, reduced prosperity, and a variety of other unintended consequences.

This is not to say that regulatory balance, which was explicitly addressed in the Staggers Act, is not something to be considered. But the public interest is not served when regulators acquiesce to the demands of self-interested parties overly focused on the short-run impacts on a narrow slice of economic activity. Rather, advancing the public interest demands that regulators consider the unique characteristics of the industry in question and its role in the broader economy over the long run.

Shippers and unions, as well as the U.S. as a whole, have greatly benefited from the partial deregulation that followed the enactment of the Staggers Act. Even with the COVID-19-era supply chain chaos currently plaguing carriers and shippers alike, inflation-adjusted rail freight rates remain far below the heavily regulated rates of the 1970s.

While righting market wrongs is a powerful impulse for many, the error costs of government action frequently exceed the costs of market failures. As shown by the history of railroad regulation, the costs of government failure can not only be enormous, but can persist over many decades—and difficult to undo once in place. When it comes to railroad regulation, Congress and regulators should tread lightly to avoid repeating the mistakes of the past.

Freight rail deregulation: Past experience and future reforms

The post Freight rail deregulation: Past experience and future reforms appeared first on Reason Foundation.

Unions are likely to resist labor-saving technologies out of perceived self-interest, but the 20th-century experience with over-regulation in the railroad industry suggests Congress and the Biden administration should be wary of calls to impose regulatory impediments to industry evolution in the 21st century.

My new Reason Foundation policy brief examines the history of economic regulation of the U.S. railroad industry, discusses emerging regulatory threats, and recommends reforms policymakers can enact to ensure freight rail remains on a strong competitive footing going forward.

Railroads were first subjected to national economic regulation under the Interstate Commerce Act of 1887, which created the Interstate Commerce Commission (ICC) to oversee the industry. In the decades that followed, Congress and the ICC produced a growing list of mandates and proscriptions into virtually every rail business decision. Customers and rail carriers could not negotiate customized service contracts under rigid common carrier rules, entry and exit were heavily restricted, and prices were divorced from economic reality, frequently being kept artificially high by regulators to protect weaker competitors (of which there were a great many).

By the middle of the 20th century, new developments such as ubiquitous auto ownership, the Interstate Highway System, rapidly growing trucking companies, and the introduction of jet airliners undercut demand for passenger and freight rail services. Between 1945 and 1955, passenger and freight revenue fell by 71.1% and 12.5%, respectively, while rail’s market share of intercity freight traffic declined from 68.7% to 49.4%.  

With fewer financial resources available to support their networks, the railroads began struggling to maintain their existing infrastructure. Congress and the White House grew increasingly concerned that rigid regulation was stifling the industry and preventing it from adapting to new economic conditions but did little beyond issuing official reports that merely acknowledged the worsening problem.

This finally changed in the 1970s when the situation became so dire that inaction was no longer an option. Penn Central, the major rail carrier in the Northeast U.S., filed for bankruptcy in June 1970. This would remain the largest corporate bankruptcy in U.S. history until it was eclipsed by the 2001 Enron collapse. With the Northeast on the verge of losing all meaningful rail service, Congress passed legislation establishing Amtrak in October 1970 to provide passenger rail service too unprofitable for private carriers to continue subsidizing with dwindling freight revenue. This was followed by legislation in 1974 and 1976 that created Conrail, which took over freight rail operations previously undertaken by Penn Central and six other bankrupt railroads in the 17-state Northeast/Midwest service region.

The prospect of perpetual government ownership and management of decrepit rail assets—so dilapidated that regulators began tracking “standing derailments,” incidents where the track bed crumbled away and caused stationary railcars to tip over—proved to be politically unappealing. In this environment, substantive regulatory reform began to be discussed in the halls of power.

Freight rail deregulation began with the 4R Act of 1976. Most significantly, the law legalized contract rates, allowing customers and railroads to negotiate tailored service agreements for the first time since 1903. The ICC even created an advisory office to encourage railroads to take advantage of this new regulatory freedom. In 1979, President Jimmy Carter appointed economist Darius Gaskins to chair the ICC. Gaskins quickly went to work identifying and eliminating the ICC’s bureaucratic inefficiencies, which included demoting career agency employees opposed to reform.

While this was taking place internally at the Interstate Commerce Commission, an emerging consensus among Congress, the Carter administration, industry, consumer advocates, and academia that spanned the ideological spectrum was developing a plan to replace command-and-control rail regulations with market processes. This culminated with the Staggers Rail Act of 1980, which eliminated most economic regulation of the railroads.

The results of the Staggers Act have proved that supporters of economic deregulation were right. The gains enjoyed by carriers and their customers in the decades that followed are large and unambiguous. Inflation-adjusted average freight rates have declined by 44% while freight volume grew by 57%. Even though the law only concerned economic deregulation, the Staggers Act enabled large safety gains, with a 76% decline in train accident rates and an 85% decline in employee injuries and occupational illnesses.

Despite the clear success of partial rail deregulation, some politicians and special interests seek to reverse these reforms and prevent freight railroads from adapting to new competitive market pressures. A coalition of large industrial shippers led by the chemical industry is seeking new regulations that would limit railroads’ return on investment and, thus, capacity to invest in system improvements. Tellingly, these shippers have strongly opposed the ICC’s successor agency, the Surface Transportation Board, adopting robust benefit/cost analysis for major new regulations similar to what has been required of all federal departmental agencies since the Clinton administration.

With rail’s truck competition anticipated to increasingly automate in the coming decades and with labor accounting for nearly half of truck operating costs, rail must also adopt new productivity-enhancing automation technologies to remain viable through the 21st century. Unfortunately, even small movements in this direction—such as by harnessing existing mandated automation and communications technologies to enable single-person crews on some trains, long the default in Western Europe—have been strongly resisted by rail unions. The unions currently have the support of the Federal Railroad Administration (FRA), the rail industry’s safety regulator, which has proposed a rigid crew-size regulation despite conceding it does not possess “any meaningful data” to support the conclusion that two-person train crews are safer than one-person crews.

Organized labor has also opposed automated track inspection that FRA’s own data finds is more accurate than traditional visual inspections. Adopting automated inspection technologies would not only improve safety for the trains operating over the rails, but it would also keep track inspectors out of harm’s way and reduce rail equipment accidents in the field. While FRA was an early supporter of these improved track inspection technologies, it has recently and inexplicably reversed course at the request of rail unions.

Between its recent proposal on crew-size mandates and its reversal on automated track inspection, there is growing evidence that the Federal Railroad Administration has been captured by and subordinated its statutory safety mission to rail labor unions. The good news is Congress can protect the gains realized from the Staggers Act and help usher in 21st-century freight rail.

Congress should mandate that new major rules promulgated by the Surface Transportation Board be supported by robust benefit/cost analysis and limit the agency’s discretionary powers. Congress should also explicitly prohibit the Federal Railroad Administration from regulating train crew size and establish a permanent automated track inspection program not subject to the whims of political appointees.

For more on this topic, see my full Reason Foundation policy brief, “Freight Rail Deregulation: Past Experience and Future Reforms.”

The post How to build on the success of past railroad deregulation appeared first on Reason Foundation.

• Gas stations in an electric vehicle world
• Why California high-speed rail failed
• Treating induced demand as a religion?
• Smart roads’ disappointing performance
• Opposition to FHWA’s proposed GHG regulation
• The private sector’s historic role in British toll roads
• News Notes
• Quotable Quotes

Gas Stations in an Electric Vehicle World  

Shell, the world’s largest gasoline retailer with 46,000 stations in 80 countries, is showing off its gas station of the future in southwest London. Instead of gas pumps, the station has 10 fast chargers under artistic wood coverings. To keep customers occupied during charging periods of 20 to 40 minutes, it sells sodas, snacks, and basic groceries. Although it has only a few prototypes like the one in London, Shell already has 9,000 branded charging points in operation.

But as a lengthy article by Politico pointed out recently, it’s doubtful that many conventional urban gas stations with six or eight pumps can survive by converting to electric vehicle (EV) charging. The article explains the ongoing war between electric utilities and elective vehicle charging providers like EVgo and ChargePoint, along with truck stops and traditional gas stations. Until recently, most states had laws that prevented anyone but regulated electric utilities from selling electricity. Although that has been changing, the way electricity is provided to EV charge companies is economically untenable, at least in these early days of the transition from petroleum-fueled vehicles to electric vehicles.

But before going further, let’s do a little math.** With today’s electric vehicle batteries and DC fast chargers, average EV charging takes 20 to 40 minutes—say 30 minutes on average. A typical gasoline fill-up takes about five minutes. Hence, the dwell time of the EV is six times as long as the gas-fueled car. A gas station with 14 pumps can refuel 14 cars in five minutes. During a 12-hour day, it can refuel 2,016 cars. But in that same 12 hours, the station can handle one-sixth as many electric vehicles—just 336. If the average price to provide an EV charge were the same as the average gasoline bill, the station owner would see a drastic reduction in revenue.

One alternative would be a much larger footprint for the electric vehicle (EV) station—up to six times larger to generate the same revenue. That will not be feasible in most urban areas, where affordable land adjacent to gas stations is mostly not available. But it’s a different story in some low-density suburban areas, exurbs, and on long-distance highways in rural areas. That is why convenience store chains and truck stop chains are better positioned than gas stations to be the providers of EV charging.

One early mover is North America’s largest truck stop operator, Pilot Company. As Utility Dive pointed out last month, Pilot has formed a joint venture with General Motors and EVgo to add 2,000 fast chargers to 500 of its U.S. “travel centers” (aka truck stops). It turns out that EVgo had already been working with gas station/convenience store chain Wawa and several others. As you may have noticed in recent years, non-urban gas stations increasingly include “convenience stores,” whose operating margins are higher than what they make from selling gasoline. One consultant told Utility Dive that convenience stores now sell 80% of America’s gasoline. So it should not be surprising that the National Association of Convenience Stores joined with the National Association of Truck Stop Operators in trying to influence what became the Infrastructure Investment and Jobs Act (IIJA) legislation to address gas-station/convenience store problems with electric utilities. That lobbying produced only lip service in the final legislation, but most states have already exempted gas stations and convenience stores from their bans on those businesses selling electricity to EV operators.

Gas stations have a long history, starting out as mere “filling stations” (a gas pump outside a general store), becoming full “service stations” offering an array of auto maintenance services, and more recently becoming self-service operations selling fuel in most urban locations but paired with a convenience store in suburbs, exurbs, and the countryside.  My bet is on the truck-stop/convenience store EV charging model as the next step in their evolution.

» return to top

Why California’s High-Speed Rail Failed

Back in 2007, I read a number of reports suggesting that spending $33 billion of taxpayers’ money on a high-speed rail (HSR) system between Los Angeles and San Francisco would have costs exceeding benefits. The idea that a new rail corridor would cost less and be more beneficial than (a) adding priced express lanes to Interstate 5 between the two metro areas, or (b) getting more use out of the multiple airports in both metro areas that would offer travelers departure and arrival locations closer than downtown Los Angeles and San Francisco to their actual origins and destinations, struck me as ludicrous.

My concerns led to a highly detailed 2008 Reason Foundation study on the proposed system, released several months before voters statewide had to vote yes or no on a $10 billion general obligation bond issue to launch the project’s development. The 196-page “due diligence report” raised concerns about where the rest of the funding would come from, whether the travel time between Los Angles and San Francisco could actually be achieved, and the likelihood that if built, the rail system would require operating subsidies, like almost all overseas HSR systems. In Oct. 2008 testimony before the California Senate Transportation and Housing Committee, study co-author Joseph Vranich said, “The current proposal is untenable. The train will go slower than they say it will, will carry fewer people than they claim it will, and will cost much more than they say it will.” That all turned out to be correct.

It’s taken many years for the project’s failure to become widely recognized, but one dogged reporter has been on the California high-speed rail beat for more than a decade: Ralph Vartabedian, then at the Los Angeles Times and more recently writing major pieces for The New York Times. In his latest NYT article, “How California’s Bullet Train Went Off the Rails,” he reveals many new findings that explain mostly political decisions that led to the cost ballooning to $113 billion, with only a small segment under construction (from “nowhere to nowhere” in the middle of the state) and funding for the rest far from assured.

A key factor in the enormous cost escalation was the political decision early on to avoid the direct route between Los Angeles and San Francisco—paralleling I-5. That route would have relied in part on the existing state-owned right of way and avoided huge, costly battles with agricultural interests in the Central Valley who didn’t want their farms, groves, and ranches cut in half. It would also have avoided the much greater need for costly tunnels to cross the mountains between the two metro areas and the Central Valley. Vartabedian details the politicking that took place to put the route instead through Palmdale, Bakersfield, Fresno, Madera, and other areas. That route was longer, encouraged low-traffic station stops, and ended up requiring slower speeds on shared trackage in both the San Fernando Valley and Silicon Valley. Vartabedian, for the first time, reveals who was responsible for that foolish route decision.

In the early years, the California High-Speed Rail Authority assured the state legislature and the media that the system would not require operating subsidies, so they were confident that private investors would cover part of the construction costs in exchange for some of the resulting fare revenue. In those years, European and Japanese high-speed rail companies spent time in California checking into the viability of the project, likely hoping to become part of it. As Vartabedian had previously reported (and notes again in the current article), French railroad company SNCF recommended the I-5 route as far wiser, facilitating the promised two-hour and 40-minute nonstop travel time. But the company lost interest when the longer and more-costly route was chosen. And no private investment in the system ever materialized.

Many people suspected politics was behind the foolish decisions, but for this detailed article, Vartabedian got many early supporters and decision-makers to acknowledge what actually happened and how those decisions made the project unlikely to ever be completed (and incapable of meeting the nonstop trip time promised to voters who approved the 2008 bond issue). Vartabedian and the New York Times have done this country a great service by unveiling how politics contributed significantly to making an already questionable project unviable.

» return to top

Treating Induced Demand as a Religion?
By Baruch Feigenbaum

A recent article in Transfers Magazine published by the Pacific Southwest Region University Transportation Center argues for “spreading the gospel of induced demand.” Unfortunately, the article simplifies induced demand into a series of yes or no questions and then recommends that people, whom the article showed do not understand the concept, “become evangelical about it.”

The authors start by giving a brief introduction to induced demand. In the next section, the authors present the findings from a series of questions they asked 597 non-students and 520 university students throughout the U.S. about induced demand. I have some methodological concerns with the survey. The sample size is very small, so the margin of error could be very large. The survey used stated preference when revealed preference would have been a better process. The survey questions were binary, requiring yes or no answers. Yet induced demand falls within a range. The first question asked whether adding lanes to a roadway is “likely” or “unlikely” to reduce congestion in the long term. But the accurate grad school answer is “it depends.” If it is a low-density slow-growing area, then induced demand is unlikely. If it is a fast-growing area or one with a high population density and the new capacity is priced, induced demand is unlikely or at least smaller in magnitude. If the capacity is not priced, induced demand is likely.

The second question asked if transportation policy should make it easier for most people to drive for most trips or try to shift most trips toward public transit, walking, and bicycling. Again, why can’t the answer be both? Certainly, in rural areas, it makes sense to make it easier for people to drive, since other options might not be available. If you live in West Virginia and you live 20 miles from your job, walking does not seem like a viable alternative. And as the article does throughout, the paragraph includes a normative statement about “respondents who understood that road expansion will not alleviate traffic congestion.”

In a follow-up question, the authors asked what should be done about traffic congestion. They found that even those who agreed that induced demand is a problem supported road widening. The authors speculated that some respondents might support road widening to encourage economic development. Further, the article noted that 89% of respondents who agreed with induced demand thought building more transit would address the problem. Seventy-three percent thought transit was the best option. Yet the authors note that transit can also create induced demand since if more people use transit, more road space will become available for discretionary trips.

Finally, the survey examined whether people’s opinions on induced demand can be changed. It added “refutation text” claiming that adding lanes only reduces congestion over the short term. After reading the refutation text, support for expanding highways declined from 76% to 50%. But six months later, the researchers asked the same question and found support for road widening rebounded to 79%. The authors suggest the change in opinion was due to “acquiescence bias,” but it’s just as likely that, after experiencing congestion in their daily commutes, some people changed their minds.

After the research section, the authors switch to advocacy mode and recommend three calls to action. The first is that proponents should stop justifying roadway and transit projects with the promise of congestion relief. I agree with this recommendation. Highway projects can enable more economic activity, increase safety, improve freight delivery, and allow more people to use roadways. Congestion relief may not be a long-term benefit. Transit projects can help working-class residents reach their jobs, but they don’t reduce traffic congestion either.

The authors’ second recommendation is to spread the word about induced demand. But one of the main findings of the study is that almost nobody understands induced demand. If people don’t understand what it is, why are we asking them to teach it?

The third recommendation is to “update” our teaching on the subject. As somebody who completed a master’s degree project (mini-thesis) on induced demand, I’m dismayed that so few students understand it. But what individual will provide a balanced approach to induced demand? Perhaps retired University of California-Berkeley professor Robert Cervero would be willing to come out of retirement to teach the class. Cervero studied the phenomena of induced demand in California and then spent years pushing back about bogus claims about induced demand across the country.

More troubling is the authors’ recommendation of the “induced demand calculator,” which is used as a sort of propaganda tool and was created by several 501(c)4 advocacy groups. As I wrote in the January Surface Transportation Newsletter, the calculator does not provide an accurate measure of induced demand:

The calculator treats all new travel as bad. Yet increasing roadway capacity in urban areas has at least three benefits. First, new road capacity creates economic benefits. It allows employees to reach a larger number of employers in a given time, creating a better match between employees and employers. It promotes economic activity by increasing the number of consumers that can reach businesses in 15 minutes.

But the calculator’s biggest problem is that it is technically inaccurate. Instead of separating existing trips made at a different time or on a different roadway from new trips, the calculator assumes all new travel that happens at a given time on an expanded roadway at any given point is induced demand.

Most troubling is the report’s blurring of lines between research and advocacy. The authors advocate treating induced demand as a “religion.” Yet transportation research should be based on science. And religion and science are opposites. One requires creating a hypothesis and testing it using the scientific method. The other requires believing something as a fact without testing or questioning it. Neither this article nor the concept of induced demand should be treated as any type of gospel.

» return to top

Smart Roads’ Disappointing Performance

Engineering News-Record (ENR) published a major article on various kinds of “smart-road” technology in its Sept.5 issue, headlined “Laying Tech Test Tracks.” The subheadline gave away the findings: “Domestically and abroad, agencies are testing smart roads with mixed results.” The findings reinforced the skepticism I’ve expressed in previous newsletter articles about both on-road electric vehicle charging, now dubbed dynamic charging, and “solar roads.”

The idea of charging electric vehicles (EVs) while they drive on highways sounds appealing, as opposed to having to get off the road and sit waiting at a charging station for 45 to 60 minutes while the vehicle gets charged. The problems that are emerging in test projects reflect the practicality of actually doing this on a large scale, as well as the lack of a viable business model under which vehicle operators actually pay for the electricity they pick up while driving.

The ENR article profiles several test projects under way in both Europe and the United States. One startup is WiTricity Corp., in which Siemens recently acquired a minority stake. So far, all it has demonstrated is static charging, in which a bus or other vehicle is charged while sitting in one place. The big action is in dynamic charging, with several firms testing their approaches. One is Electreon, an Israeli startup. Early this year, it demonstrated dynamic charging on a 1km closed track near Milan, Italy. Electromagnetic coils were embedded in the roadway, in varying kinds of asphalt pavement, at a cost of $1 million per lane-km. The coils have an estimated life of 10 years. Trials of Electreon’s system are under way in Sweden on a 1.65 km highway section on Gotland Island. Electreon says that trial showed the vehicles could charge while driving at 80 km/hr (about 50 mph). More recently, Michigan DOT is gearing up for a trial of Electreon’s system on a 1-mile road segment.

To be able to pick up electric energy on the fly, an EV must be equipped with an Electreon receiver. For widespread use, in addition to many thousands of highway miles being equipped with in-pavement coils, all EVs would need to be outfitted with compatible receivers. And there must be a way to itemize the amount of electricity picked up by each vehicle so that the owner/operator can be charged for that amount. A contractor working with Electreon in Sweden noted to an ENR reporter that “There is still some work to do concerning standardization, industrialization, and the business model.” No doubt.

Let’s also do a bit of number-crunching about dynamic on-road charging. In the Italian trial, Electreon told ENR that a small Italian Fiat 500 drove for four hours on the closed track, and its small battery only went from 22% charged to 48% charged. On a highway trip, to get that modest increase in stored electricity, an EV going at 50 mph would have to be charging while driving 200 miles. A larger EV, like a Tesla, would have to drive a lot further than that, charging all the way, to get such a modest improvement in its stored electricity. That would require a huge amount of in-road coils, at $1.6 million per lane-mile.

Florida is also getting into dynamic charging tests. The Central Florida Expressway Authority is planning a $10 million dynamic charging pilot project on one mile of its upcoming Lake/Orange expressway. The roadway equipment, in this case, will be provided by Evolgy, a European company. The project is being coordinated by ASPIRE, an engineering research center at Utah State University, with support from the National Science Foundation. ASPIRE is also working with transportation agencies in Michigan, Indiana, and Utah on other dynamic charging pilot projects.

As of now, my assessment is that this is a cool-sounding idea that very likely will not make sense as an alternative to EV charging stations and has yet to set forth any kind of plausible business model.

» return to top

Opposition Builds to FHWA GHG Mandate

The Federal Highway Administration (FHWA) has received more than 39,000 comments regarding its proposed regulation that would require state departments of transportation (DOTs) to track on-road greenhouse gas (GHG) emissions with the goal of achieving net-zero highway emissions by 2050. More than half of Senate Republicans (27) sent a letter to the FHWA deputy administrator arguing that there is no legislative basis for such a regulation. The American Road & Transportation Builders Association also objected to the regulation. But 28 Senate Democrats sent a letter to Transportation Secretary Pete Buttigieg supporting the proposed regulation.

The American Association of State Highway and Transportation Officials (AASHTO), representing all 50 state transportation departments, sent a letter to FHWA pointing out that “consensus support” for the regulation is lacking among its members. AASHTO’s letter pointed out that “we do not see a provision in federal law that requires FHWA to establish a GHG emissions performance measure,” and that “FHWA’s [justification] of its legal authority for establishment of this new rule can lead to consequences beyond the intent of Congress.” 

Critics have pointed out that a provision similar to the proposed FHWA regulation had been included in the House transportation reauthorization bill, but that bill was scrapped when Congress adopted the bipartisan infrastructure law approved by the Senate, which became the IIJA law signed by President Joe Biden. Hence, Congress had considered such a requirement but ended up rejecting it.

This matters because of a recent Supreme Court decision: West Virginia v. Environmental Protection Agency. The majority opinion by Supreme Court Chief Justice John Roberts found that the EPA had put forth a mandate for states to adopt a cap-and-trade scheme for carbon emissions, after a bill to require that had recently been rejected by Congress. In rejecting EPA’s assertion of legislative powers, the court expanded on previous vague provisions in its “major questions” doctrine. Under the clarification, a regulation may be challenged if it is economically significant and is based on a broad interpretation of a very vague statutory provision or no authorization from Congress. (For more details, see “A Major Win for Limited Government,” Cato Policy Report.)

I am not an attorney, but I think it’s highly likely that if FHWA proceeds to enact this proposed regulation, there will be immediate litigation based on the West Virginia decision, and that litigation is likely to lead to the regulation being thrown out. That will hand the matter back to Congress, where it belongs.

» return to top

The Private Sector’s Historic Role in British Toll Roads
By Alan Rosevear, Dan Bogart, and Leigh Shaw-Taylor

Robert Poole’s Editor’s Note: I met co-author Dan Bogart when he hosted me for my 2018 book tour appearance at the University of California-Irvine, where I learned of his already extensive research on United Kingdom turnpike trusts. This article is the concluding section of the authors’ new working paper on the subject, which I highly recommend.

We have shown that before the expansion of railways, a network of good-quality main roads across England and Wales provided a transport infrastructure that was fit for purpose. This contrasted with the generally expressed view that main roads had been in a poor state at the turn of the [19th] century. Government had intervened during this period, but the extent to which it was responsible for infrastructure improvement has been unclear. Our analysis demonstrates that turnpike trusts were responsible for building 4,000 miles of new, good-quality road in England and Wales, much of it between 1810 and 1838. On a directly comparable basis, the not-for-profit trusts built 30 times the mileage than had been built with direct government funding during the early 1800s. Nevertheless, government intervened successfully in less-direct, subtle ways across the wider road network.

Firstly, it provided a framework in which interest groups and government actors could explore both the problems and solutions to meeting demand. Member of Parliament Henry Parnell described their input as “working with the trusts,” though in practice, there was intervention for a short period in some trusts and increased regulation and greater public reporting for all.

Secondly, although the government-funded works of Telford created an iconic road to Holyhead, the exposure and approval given to McAdam and his methods in government enquiries persuaded many more trusts to employ him. This ultimately led to the age of standardization which was an indirect triumph for government intervention. We believe that this voluntary adoption of the expert-led approach resulted from the partnership of government with the not-for-profit turnpike trusts. It left some localism and conveniently kept the costs of road infrastructure on the road user, not direct taxation.

Finally, our analysis illustrates how the growing state capacity in England and Wales did not directly lead to a large increase in public goods and road infrastructure. In the main, it led to better regulation and support of not-for-profit trusts which could hold and efficiently manage nationally important infrastructure assets. The framework of support, targeted management intervention, and regulation established by government made the independent turnpike trusts of the early 19th century more capable than those which had begun to fail in the late 18th century. As such, our work points to a synthesis between the traditional view that turnpike trusts were the principal actors in creating the good road network of England and Wales and the revisionist view, which sees government as playing a large and leading role.

» return to top

News Notes

Two Possible Start Dates for New Charlotte Express Toll Lanes
The Charlotte Regional Transportation Planning Organization (CRTPO) board is interested in the proposed addition of express toll lanes on I-77 between Charlotte and the South Carolina border, but the question it must decide is how to finance and procure them. The North Carolina Department of Transportation explained to CRTPO board members last month that if the state develops the project, the earliest it could begin to receive funding is 2029. But if a long-term toll-financed public-private partnership like that used to develop the toll lanes now operational on I-77 north of Charlotte is used, the $2.1 billion project could begin several years sooner. NCDOT will pursue the option CRTPO recommends.

Electric Truck Charging Network Planned for I-10
Startup company TeraWatt Infrastructure has announced that it will develop and install charging stations sized for electric trucks along I-10 from California to Texas. Freightwaves quotes CEO Neha Palmer saying that “We have brought in the large amount of power that you need for large-scale EV charging, especially for those [heavy truck] large-battery formats.” Unfortunately, the charging stations cannot be located at existing rest areas on I-10, due to a federal law dating to 1960 that forbids offering any commercial services at Interstate rest areas. Hence, electric big rigs will have to leave I-10 and go to an offline location to get charged.

Modernized Service Plazas Are Opening on New York Thruway
Under a 33-year public-private partnership (P3), 23 of the 27 service plazas on the Thruway are being rebuilt and modernized. Last month saw the reopening of the third plaza, Junius Ponds in Seneca County, with new retailers Shake Shack, Starbucks, and an Applegreen Market Store. The revamped plaza includes outdoor picnic space, room for food trucks, a dog walking area, and (soon) two EV charging stations. The $450 million cost of the program is being met by Empire State Thruway Partners, which will pay the Thruway Authority 0.84% of each facility’s gross revenue for 33 years. Although most of the Thruway is an Interstate (I-90), because it is a toll road that predates the 1960 ban on commercial services, it and other tolled Interstates were exempted from the commercial services ban.

Express Toll Lanes Opening in California and Utah
New express toll lanes (ETLs) opened at the beginning of November on US 101 in the Bay Areaa and on I-15 in Utah. Both projects are extensions of existing express lanes added in recent years.  In Utah, the I-15 ETLs now extend 82 miles from south of Salt Lake City to Ogden to its north. Utah DOT says this is the country’s longest continuous ETL corridor; it has one lane in each direction. The new California ETLs are in San Mateo County, from Redwood City to I-380 in South San Francisco. These 22 miles of new ETLs connect to recently completed ETLs on US 101 in Santa Clara County. The latter offer one express lane in each direction, rather than two in San Mateo County. The 101 express lanes are part of the growing network of such lanes in the San Francisco Bay Area.

Melbourne Airport Rail Line Found Not Cost-Effective
A benefit/cost analysis of the proposed $8.3 billion rail line between downtown Melbourne and the Melbourne Airport has been found by Infrastructure Australia to be not worth building at this point. The net present value of the project was found to be -$2.4 billion, with a benefit/cost ratio of 0.5. Infrastructure Australia used the same 7% discount rate as America’s Office of Management & Budget (OMB). A business case assessment by the Victoria government used only 4%, with a benefit/cost ratio of 1.0. Infrastructure Australia noted that the rail line may be justified in the future, but the Tullamarine Freeway between the airport and downtown will not reach capacity until 2036.

Toll Traffic Volume at Pre-COVID Levels
Fitch Ratings on Oct. 17 reported that traffic volume on U.S. toll roads returned to 99% of its 2019 level during the first six months of 2022. Toll traffic lagged this average in the San Francisco Bay Area while exceeding 99% on most tolled facilities in Florida, Oklahoma, and Texas. The data were published in Fitch’s U.S. Airports and Toll Roads Traffic Monitor.

Gasoline Use Reached New High in 2022
Jeff Davis reported in the Oct. 20 issue of Eno Transportation Weekly that a record 6.8 billion gallons of gasoline were sold in the United States in the 2022 fiscal year (FY); the previous peak was in 2018. The data come from the year-end report from the Treasury Department on the receipts from the federal gasoline tax—$27.5 billion compared with $26.25 billion in FY 2018. Federal diesel tax receipts also reached an all-time high of $12.2 billion. Motorists and truckers evidently drove more than expected in FY 2022, and larger, heavier gas-guzzling SUVs and pickup trucks are a larger component of the personal vehicle fleet. Legislated increases in federal Corporate Average Fuel Economy (CAFE) requirements and increasing electric vehicle penetration will reduce fuel consumption in future years.

Audi Developing Anti-Pollution Devices for Electric and Conventional Vehicles
Rubber-tire vehicles operating on pavement generate particulate matter, 85% of which is caused by abrasion of tires and roadways. German auto company Audi, along with supplier Mann+Hummel is developing a filter in line with the radiator (on internal combustion vehicles) to trap these fine dust particles. On EVs, the filter can also be operated while the vehicle is stationary, and being charged. The filter system has been tested on Audi vehicles, including the electric e-tron.

Parkersburg Bridge Privatization Ahead of Schedule
The aging Memorial Bridge in Parkersburg, West Virginia, is being rehabilitated by United Bridge Partners, which is buying the bridge from the city. The $50 million renovation cost is being paid by UBP, whose contract with the city transfers ownership and operations to the company. UBP is also continuing to pay part-time toll collectors during reconstruction, despite the bridge being closed to traffic, and it is working on a severance package for them, since tolling will go all-electronic when the bridge re-opens in Aug. 2023, three months earlier than the original schedule called for. The toll when the refurbished bridge reopens is expected to be $1 compared with the prior 50 cents.

$1.5 Billion Rail Complex to Relieve Los Angeles Ports Congestion
BNSF Railway last month announced plans to develop a $1.5 billion rail facility in Barstow, 130 miles from the ports of Long Beach and Los Angeles. The purpose of the 4,500-acre facility is to allow containers offloaded from incoming ships to be sent by rail directly to the Barstow International Gateway, where the cargo can be transloaded from 40-foot international containers to 53-foot domestic containers for onward shipment by rail or truck. BNSF already has a rail yard on the property, which is linked to the railroad’s main lines heading east.

Hurricane Leads to EV Battery Fires in Florida
Among the impacts of Hurricane Ian on the southwest coast of Florida have been many vehicles damaged by flooding. State Fire Marshal Jimmy Patronis sent an alert on Oct. 6 to first responders, noting that corrosion from having been underwater has led to EV batteries catching fire. The next day the Fire Marshal’s Office sent out a detailed warning outlining recommended procedures from the National Fire Protection Association (NFPA). It outlined what EV owners should do (and not do) if their vehicles experienced flooding and procedures for firefighters to deal with battery fires.

General Motors Thinks You Will Drain Your EV During Power Outages
The giant auto company last month announced the launch of a new division, GM Energy, that will sell electricity storage units to EV owners. The equipment will enable the EV owner to use electricity from the EV’s battery and/or the storage unit to supply electricity to their home during power outages. This might be fine for a half-hour outage, but as someone who lives in hurricane country, I’m very familiar with power outages lasting three to five days. One thing I don’t want during such a period is to be stranded, immobile, and unable to get to grocery stores or Home Depot to deal with other impacts of the hurricane.

Infrastructure Asset Recycling Proposed in Ecuador
Ecuador’s Minister of Transport and Public Works plans to lease existing airports and toll roads to investors, aiming to raise large enough up-front payments to reduce the government’s $64 billion debt. Inframation News reported (Oct. 21) that if Ecuador’s Congress approves a new investment law that would permit asset recycling, it will engage in feasibility studies of long-term P3 leases of two airports, a seaport, and several highways.

Will Construction Cost Inflation Consume New Federal Spending?
The July-August issue of ARTBA’s Transportation Builder magazine contains a graph of the sharply increasing costs of the inputs to highway and street projects. The producer price index for these inputs (excluding labor costs) has increased from 100 in 2014 to 150.1 as of June 2022, with most of that increase taking place since 2020. American Road & Transportation Builders Association (ARTBA) chief economist Alison Premo Black noted, “The average cost of materials used in highway and street construction was up 15% in July [2022] compared to July 2021.” With skilled construction labor also in short supply, a significant fraction of increased federal IIJA funding will be absorbed by the increased cost of already planned projects.

I-81 Syracuse Viaduct Removal Moving Forward
Engineering News-Record (Oct. 3) reports that the project to tear down the elevated I-81 route through Syracuse, NY, passed a milestone in September with the shortlisting of firms for the first phase of deconstruction. The total expected cost of removing the 1.4-mile viaduct and replacing it with a boulevard is $2.3 billion. Deconstruction is expected to begin by year-end and continue through 2025.

» return to top

Quotable Quotes

“Not looking good in hindsight are two former California governors, Arnold Schwarzenegger (R) and Jerry Brown (D), who backed the [high-speed rail] plan as a way to reduce carbon emissions from cars and planes. Don’t feel too sorry for California voters, though, who brought this mess on themselves—first by approving the 2008 referendum, then by re-electing Brown in 2014 over moderate Republican Neel Kashkari, who campaigned against what he called the “crazy train.” . . . Full operation of a San Francisco-to-Los Angeles bullet train would cut carbon emissions by the equivalent of 213 million gallons of gasoline per year, according to the high-speed rail authority’s 2022 annual report. That’s about a week’s worth of California’s fuel consumption in 2021. Surely there is a cheaper, less-grandiose way to achieve the same savings.”
—Charles Lane, “California ‘Crazy Train’ Is Still Going Nowhere Fast,” The Washington Post, Oct. 12, 2022

“Cal HSR is just the most dramatic example of the cultural framework that has overtaken public policy/projects in the last 20 years, where there is a general tacit agreement (diffused among several authorities, consultants, and elected decision-makers) that outcomes don’t have to be taken seriously—and that special interest orientation (ideology, mode, geography) is given the same weight as engineering economics—especially if the project is supported by ‘someone else’s money.’”
—Stephen Lockwood, “Just Another Piece of Mega-Pork,” posted on a private transportation blog, Oct. 14, 2022 (used by permission)

“The administrative state’s corrupting, fundamental forces are on full display in our MARAD/FOIA case [regarding the Jones Act], which is indeed right out of the textbooks. A federal agency tasked with supporting the U.S. transportation system and Merchant Marine has evolved over decades to become little more than a lobbying firm for a law (and industry) that actually undermines the agency’s statutory purpose. Its ‘advisory committee’ is stacked with industry insiders dedicated to preserving that harmful status quo, and its employees routinely strategize with lobbyists and other industry players—‘elites’ by anyone’s definition—to deliver [economic] rents, not to effectuate great policy, regardless of the harms that such actions cause.”
—Scott Lincicome, “My ‘Treason’ Charge and the New Right’s Governance Fantasy,” TheDispatch.com, Oct. 26, 2022

» return to top

**Editor’s note Nov. 8, 2022: The original figures in this paragraph were incorrect and have been updated.

The post Surface Transportation News: Gas stations and electric vehicle charging, high-speed rail failure, and more appeared first on Reason Foundation.

The Denver Regional Council of Governments recently approved a long-range transportation plan that unwisely calls for eliminating the planned express lane extensions on C-470 and I-25. Rather than wrongly stigmatizing the toll lanes as part of a car-centric vision of the past that they’re trying to get away from, Colorado’s regional planners should view express lanes as part of the future’s greener, more efficient transportation network that serves electric cars and buses.

The idea that highways are inherently bad due to the emissions from today’s gas-powered vehicles will be less and less accurate in the coming decades as electric cars become widely adopted. A long-range transportation plan should look at all long-term trends and take a holistic approach. In the years to come, more Coloradans are likely to buy electric cars than to give up driving and their cars entirely. The region’s plans need to reflect that reality.

The Denver metro area was one of the country’s five fastest-growing large regions between 2010 and 2020. Only Dallas, Houston, and Seattle grew faster over the last decade. Denver’s population increase is spread across six counties, and work and commuting patterns vary widely.

With today’s large-scale decentralization of homes and jobs, it is increasingly difficult to serve large numbers of workers via mass transit. Over the past decade, the University of Minnesota has studied “access to destination” in America’s largest 50 metro areas. The university’s researchers analyzed the percentage of all available jobs that workers could reach using various modes of transportation.

The latest results, using 2019 data, show that metro Denver residents could reach 55% of the area’s jobs within 30 minutes if they traveled by car. But if they were using transit, Denver’s workers could only get to 1.39% of the area’s jobs within 30 minutes.

For those willing to commute for 50 minutes, car drivers could reach nearly every available job in Denver. In contrast, even with a 50-minute commute, mass transit users could only get 7% of the Denver region’s jobs, according to the University of Minnesota research.

Thus, even if doubling the transit system’s reach could double transit’s share by the year 2050, that would still make only 14% of jobs reachable after a 50-minute transit commute. The majority of workers will still be commuting by car in the coming decades — even if transit use doubles and working from home continues to grow.

And due to its high quality of life, metro Denver is likely to remain one of America’s fastest-growing large metro areas — bringing more cars and workers to the area.

Denver will stay a sprawling region, so its long-range transportation strategy should reflect the future that is likely to happen.

The express lanes being eliminated use variable pricing to keep traffic flowing smoothly at around 45 miles per hour, which minimizes emissions by reducing traffic congestion. The toll lanes also provide mass transit agencies with a way to offer faster express bus service—without the transit agency needing to find the money to build the lanes or to use them.

Buses using the express lanes — for free — can provide bus riders with faster trips between key destinations without the riders paying the tolls. When Miami converted its congested I-95 carpool lanes into express toll lanes, for example, ridership on express bus service in the corridor quadrupled because the buses became much faster and more reliable.

Express toll lanes provide a sustainable revenue source to fund the highway lanes that electric cars will need in the decades to come. They are also a perfect match for region-wide express bus service. Rather than eliminating express lanes, metro Denver should build a region-wide express toll lanes network that would better serve the future electric cars, buses, and emergency vehicles.

Reducing emissions is an admirable goal, but planners shouldn’t pretend that the workers and businesses across the Denver region will be giving up their cars for bikes and walking. The region’s economy depends on people and goods moving efficiently, and express lanes should be a key part of the long-term plan.

A version of this column first appeared in The Denver Gazette.

The post Express lanes for electric vehicles should be a bigger part of Denver’s long-range transportation plan appeared first on Reason Foundation.

• Priced managed lanes rebound from the pandemic
• Rhode Island heavy truck tolls are unconstitutional
• Growing concerns about vehicle electrification
• Consistent policies for managed lane networks
• New questions about urban automated vehicles
• Undercutting users-pay/users-benefit
• Clearing debris from highway lanes, safely
• News Notes
• Quotable Quotes

Priced Managed Lanes Rebound from Pandemic

When traffic flow collapsed nationwide in the first half of 2020 during the COVID-19 pandemic, many skeptics suggested that variably-priced express toll lanes risked going under. That is especially true of those that were financed based on projected traffic flows. How could these facilities survive when there was hardly any traffic congestion? Who would pay tolls to avoid non-existent congestion?

The good news is that these fears were greatly exaggerated. A Sept. 2022 report from Fitch Ratings, “Peer Review of U.S. Managed Lanes,” provides an update on the 14 revenue-bond-financed projects the company rates, ranging from the very first one (SR-91 in Orange County, CA) to yet-to-open ones (I-66 outside the Beltway and Hampton Roads in eastern Virginia). Five of these facilities were upgraded to BBB or BBB+. They are SH-288 in the Houston area, I-77 in Charlotte, NC, the LBJ (I-635) express lanes in Dallas, the North Tarrant Express lanes in Ft. Worth, and the TxDOT I-35 East project in Dallas. In addition, the recently opened C-470 in Denver had its outlook revised from negative to stable. Of the 14 projects rated by Fitch, one is rated A (SR-91), eight are rated BBB, three are at BBB- and two at BBB+.

The Fitch analysts, Anne Triceri and Scott Monroe, explain the key rating drivers of these projects, which have risk factors beyond those of standard toll roads. One success factor is their unique debt structure, such as large reserve accounts and the flexibility provided by TIFIA loans (which can operate as interest-only during downturns). In the Texas projects, because those express toll lanes allow trucks, that additional traffic provided large revenue boosts during months when commuters were few and far between.

Thinking back over the 26 years since the SR-91 express lanes opened to traffic, all the naysaying has been falsified—at least for express toll lanes that are financed based on their toll revenues and which therefore had to pass a market test in order to be financed and built. Among the concerns raised—and now answered—are these:

Claim: Hardly anyone would pay high toll rates to avoid congestion.
Fact: Millions of people welcome the chance to pay, whenever they deem the value of the time savings and reliable trip time is worth more to them than the cost of the toll. 

Claim: Too many people will crowd into the lanes, so they won’t reduce congestion.
Fact: Variable pricing works; nearly all these facilities meet federal performance standards of at least 45 miles per hour travel speeds during peak periods (except where bottlenecks exist, as on I-95 northbound in Miami and I-405 northbound in the Seattle metro area).

Claim: Who would be foolish enough to invest in such risky projects?
Fact: Global toll road companies, infrastructure investment funds and buyers of revenue bonds have readily invested in these projects and are doing well.

Claim: Long-term public-private partnership projects are a scam, intended to go bankrupt and leave taxpayers holding the bag. (I kid you not: this claim was made in a 2014 cover story in The Weekly Standard.)
Fact: Actually, it’s just the opposite. Transurban North America president Pierce Coffee told a recent conference that the company continued to make its bond payments throughout the pandemic traffic downturn. “We were bearing the revenue risk,” she explained. “We were protecting the taxpayers.”

Nonsense like the above claims should finally be put to rest. Revenue-financed express toll lanes have proved their value and viability. They have come through an unprecedented traffic collapse with the same or increased bond ratings. The market has spoken.

» return to top

Rhode Island Heavy-Truck Tolls Are Unconstitutional

In a decision with far-reaching implications, federal judge William E. Smith of the U.S. District Court for the District of Rhode Island ruled that the Class-8-trucks-only toll on Interstate highway bridges violates the Commerce Clause of the U.S. Constitution. The suit was filed four years ago by the American Trucking Associations and several others. I’m not an attorney, but from a highway policy standpoint, I think the ruling makes good sense, and I hope it will be upheld if Rhode Island decides to appeal.

The state took advantage of a provision in Section 129 of the highway code that allows toll financing to be used to replace non-tolled bridges on the Interstate system with toll bridges. The Federal Highway Administration (FHWA) granted approval for the state’s proposed Rhode Works program under this provision. ATA and its allies argued that the tolls discriminated against out-of-state trucks, which would clearly violate the Commerce Clause—that is, the so-called “dormant” Commerce Clause which says that states may not interfere with interstate commerce (as opposed to the “active” Commerce Clause under which Congress can regulate interstate commerce).

The best explanation of the ruling that I’ve seen is by Eno Center for Transportation’s Jeff Davis (see Quotable Quotes for the link). Here are a few key facts about Rhode Works. The tolls were charged only to heavy trucks (Class 8 and above). An individual Class 8 truck could be tolled only once per day per bridge, and a maximum of $40 per day. Tolls were collected at only 12 bridges, nine of them on I-95. The revenues were spent on an array of bridges statewide that are not tolled.

Judge Smith understood and cites previous Supreme Court decisions regarding state regulation of interstate commerce: that states must not discriminate against interstate (as opposed to in-state) commerce and that they must not impose undue burdens on interstate commerce. He ruled that the tolls were not really related to the costs of replacing the bridges being tolled because Rhode Works uses much of the revenue on other bridges. He also cited evidence that Class 8 trucks were only 3% of the traffic on the tolled bridges—which he ruled is “inherently unfair.”  He also cited data (presumably from ATA’s brief) that 80% of the tolled vehicles are from out of state. Also, the 20% of tolled trucks that operate only within the state disproportionately receive benefits from the $40 per day maximum. Hence, the tolling program discriminates against interstate commerce, as Davis put it, “in both intent and effect.”

Let me add my two cents worth to Jeff Davis’s excellent summary. First, I think what Rhode Island enacted was a disguised border toll, something like Virginia contemplated in a quickly-abandoned plan to toll I-81 in 2019, with a high toll once vehicles crossed the border into Virginia but a very generous frequent-user rate available to state residents. That was less disguised than Rhode Works, but with the same motivation of making non-Virginians pay the bulk of the tolls.

Second, I’m very disappointed that FHWA approved Rhode Works, as being allowable under 23 USC 129, which specifically permits tolling to pay for a new bridge that replaces an old non-tolled bridge on the Interstate. When RIDOT people ran this idea by me prior to enacting Rhode Works, I suggested this was contrary to the wording and intent of 23 USC 129 and would likely run afoul of the dormant commerce clause. So I was surprised and dismayed by FHWA’s expansive reading of that provision.

State departments of transportation (DOTs) should take notice. Trying to make non-residents pay the majority of the tolls on a replacement bridge is likely to violate the dormant commerce clause. And in any future liberalization of Interstate tolling, Congress should insist that toll rates be the same for in-state and out-of-state users.

» return to top

Growing Concerns About Vehicle Electrification

Late last month at an event in Denver, the chairman of the Mercedes-Benz Group announced that this high-end automaker would cease making internal combustion engine (ICE) vehicles by 2030 (a shift from its previous plan to do this by 2039). That means just about every large automaker except Toyota plans to go electric vehicle(EV)-only by around 2035. But a number of recent studies have raised serious questions about whether this timetable is actually doable.

One concern is the availability and cost of battery ingredients—especially minerals such as lithium and cobalt. There aren’t enough mines, and many are in developing countries where mining raises serious questions (regarding child labor, for instance). A good overview of this question is “The EV Revolution: Cell-Side Analysis,” in the Aug. 20 issue of The Economist. A much longer assessment is provided in Volt Rush, a recent book by British journalist Henry Sanderson. That book and other reports document the growing dominance of China in rare earths, battery production, and EV production. In his review of Volt Rush in The Wall Street Journal (Sept. 10, 2022), energy analyst Mark P. Mills notes questions that Sanderson leaves unanswered: “Whether the world can mine enough minerals for our current EV ambitions, and what the energy used in those massive mineral supply chains does to claims of carbon-free EVs.”

Besides reading these and a number of recent papers on the shortcomings of the U.S. electricity grid for the projected EV future, what motivated me to write this article was the long lead article in the October issue of The Dispatcher, written by Michael L. Sena, a very knowledgeable transportation consultant. “Batteries: Theme of the Next Mad Max Dystoposeries” is well-researched, with citations to many of Sena’s sources.

First, Sena provides details on the surprising extent to which the Chinese government has set out to become the world’s dominant player in battery electric vehicles (BEVs). He’s been following these efforts since a trip to China in 2007 and discussed it in his 2008 book, Beating Traffic: Time to Get Unstuck. I was surprised to learn (from his current article) how much of the battery minerals sector, battery production, and BEV production is Chinese. His second point is that “battery production numbers just don’t add up.” As EV production has ramped up, the cost of the needed materials has risen, and the long-term downward trend of EV batteries (as measured by the cost per kilowatt-hour) has leveled off and started to rise. Another point is the current difficulty in recycling EV batteries—which, if it can be done cost-effectively, might reduce the need for new battery production. So far, this is far-from-proven technology.

To me the most chilling point is about the electricity needed to power a complete replacement of ICE vehicles with BEVs. Sena cites calculations by energy analyst Roger Andrews. For a hypothetical one billion BEVs worldwide, at realistic annual driving (20,000 km/year), Andrews came up with 4,400 Terawatt-hours of electricity to power those vehicles. His paper has tables for several countries, the European Union, and the world. The table for the United States estimates a need for 49% increase in installed electricity generation capacity to handle a complete transition to BEVs. Since federal policy also calls for replacing all fossil fuel electricity generation (which accounts for 61% of current generation), the total need for new electricity generation would be 110%—a staggering number.

These are sobering points. One thing that will help is the billions of venture capital going into developing alternative EV battery concepts that do not rely to the same extent on rare-earth minerals. Nearly all projections involving responses to climate change assume current technologies and their costs, because you can’t do projections of things that don’t yet exist. But I think the concerns that many researchers have raised, and which Sena has nicely summarized, call for some hard thinking about 2030 or 2035 termination of ICE production. Toyota may be right that hybrids may be more feasible for the medium term than a complete transition to BEVs.

» return to top

Consistent Policies for Managed Lanes Networks
By Baruch Feigenbaum

After metro areas build out their networks of priced-managed lanes, the next step is to develop regionwide operating guidelines for those lanes. Having managed lanes on every limited-access highway helps form an interconnected network that motorists and buses use to reach their destinations in a consistent, reliable time. However, having different operating rules for different portions of the network makes travel more complicated for users and reduces the number who will use the lanes. This is a problem because the lanes are only effective at reducing congestion and increasing transit usage if drivers understand how to use them.

The Northern Virginia area of Washington, DC, provides a good case study. In Northern Virginia, every Interstate highway (I-66 outside the Beltway, I-95, I-395, and I-495) has (or for I-66 outside the Beltway will have by December) managed lanes. For this analysis, I have included Interstates with congestion pricing (I-66 inside the beltway) but not fixed-rate toll roads such as the Dulles Toll Road and the Dulles Greenway.

Some managed lane features, such as geometric design, cannot be changed. I-95 and I-395 are reversible; I-66 outside the Beltway and I-495 have lanes in both directions. Who operates various links (Cintra, Transurban, or the Virginia Department of Transportation) is part of long-term contracts and will not change for many years (unless the contract is violated).

Operating rules are policies that detail which vehicles can use the lanes when the lanes operate, and how drivers can pay for the lanes. Making some operating rules more uniform would help drivers. For example, trucks are allowed to use the I-66 outside the Beltway lanes but not the lanes on I-66 inside the Beltway, I-95/I-395, or I-495. It is not difficult to imagine a truck driver using the direct connector from the I-66 lanes to the I-495 lanes and then finding out he is not supposed to be in the lanes when he gets a visit from a friendly Virginia State Patrol officer.

The trucking community has generally opposed tolling, citing among other things bogus numbers on the cost of toll collection that assume tollbooths and human operators. All managed lanes use all-electronic tolling. However, the way to build support for managed lanes is not to exclude truckers but rather to offer them the option to use the lanes. The feasibility and costs of retrofitting other managed lanes in the region for trucks are unclear, but it seems worth studying from both a policy and political perspective. (Having trucks use I-66 inside the Beltway does not make sense from an operational perspective.)

In addition, the lanes have different operating hours. I-66 outside the Beltway and I-495 operate 24 hours a day, seven days a week (24/7). I-95/I-395 operates 24/7 except when the lanes are being reversed, generally late mornings on weekdays and Saturday afternoons on weekends. However, I-66 inside the Beltway operates peak period/peak direction only. As a congestion-priced highway I-66 inside the Beltway is different from the other managed lanes, but given that its traffic flows are largely bi-directional, the “non-peak” direction needs pricing as much as the peak direction. Ideally, the entire road would be priced 24/7 because traffic congestion can be a problem middays, evenings, and weekends. Originally, VDOT planned to price peak periods in both directions, but then-Gov. Terry McAuliffe prevented off-peak-direction pricing for political reasons.

There are some operating rules that are uniform to all lanes but this might not be the best long-term solution. For example, all of the lanes allow vehicles with three or more people to travel for free. All allow motorcycles to travel for free. Thankfully, none allow alternative fuel vehicles to travel for free as is common in California. But allowing carpools and motorcyclists into the lanes reduces the amount of capacity for toll-paying customers. These carpools and motorcyclists have no incentive to leave the lanes regardless of the price of the tolls. Therefore, the tolls need to be higher than they would be without carpools and motorcyclists to deter enough potential customers from the lanes to reduce congestion.

Many high occupancy vehicle (HOV) lanes began as busways. But because there were not enough buses to justify their own dedicated lane, busways were converted to four-person carpool lanes, and then three-person, and often down to two. But even three-person carpools include many fam-pools or school-pools, where a parent is transporting two children to school. These are not the envisioned carpools (the children cannot drive themselves) that would get a car off the road. Instead, managed lanes should provide free passage only to truly high-occupancy buses and registered vanpools. Both are legitimate transit options that help take vehicles off the road.

The easiest way to pay tolls for each highway is to use an EZPass transponder or via Payviam (if you drive a vehicle with a built-in transponder such as trucks or some Audi and Mercedes Benz vehicles). However, for those from outside of the region or others without an EZPass, all Virginia highways provide a pay-by-plate option. All allow drivers to pay a toll online within five days for a modest administration fee, generally $1.50. However, not all drivers are going to know which website to use or how to pay the toll. And if the lane operator needs to mail you a bill the administration fee increases to $12.50. A $12.50 administration fee seems excessive for a $5 toll. Certainly, toll-road operators want to encourage drivers to get an EZPass but other major entities including the Florida Turnpike Authority and other local entities such as the Dulles Toll Road and Dulles Greenway charge a smaller $2-$5 administration fee or no fee at all.

As other regions build out their managed lanes network, they will need to tackle the same operational questions as Northern Virginia. When the physical infrastructure is complete, policymakers, transportation agencies, and lane operators need to coordinate on regionwide operating rules.

» return to top

Some New Questions About Urban AVs
By Marc Scribner

On July 21, the National Highway Traffic Safety Administration (NHTSA) acknowledged receipt of and requested comments on two petitions for temporary exemption from Federal Motor Vehicle Safety Standards (FMVSS) submitted by General Motors and Ford for those automakers’ newly developed automated vehicles (AVs). These petitions generated numerous public responses, but the responses to GM’s petition are most interesting given the unconventional design of its Cruise Origin and indicate that cities are likely to approach AVs with varying levels of enthusiasm.

Cruise, GM’s AV subsidiary, has made recent headlines for operational challenges experienced in San Francisco. In early June, a Cruise ridehailing AV, a modified Chevrolet Bolt equipped with an automated driving system (ADS), was struck by another vehicle that resulted in minor passenger injuries after it attempted to make an unprotected left turn. A San Francisco police investigation found the vehicle that struck the Cruise AV to be the “party at most fault,” but this incident led Cruise to initiate a voluntary recall of all 80 of its ADS units to avoid similar events in the future. Later in June, Cruise experienced a network malfunction that caused several of its ridehailing AVs to cluster on a downtown San Francisco street late at night, impeding traffic on the block for two hours. These events were referenced by some commenters in response to GM’s FMVSS exemption petition to NHTSA.

The exemption petitions submitted by GM and Ford are similar in that they both propose to deploy purpose-built AVs. But they differ significantly in that the Ford vehicle would be equipped with conventional manual controls allowing it to be operated by human drivers. GM’s battery-electric Cruise Origin, in contrast, is a specially designed autonomous passenger shuttle that lacks a steering wheel and pedals for manual human operation.

Exemptions from FMVSS were first provided by Congress in 1968, two years after it had authorized federal auto safety regulation with the National Traffic and Motor Vehicle Safety Act of 1966. The current framework was largely established in subsequent 1972 amendments, which granted the Secretary of Transportation the authority to approve exemptions to “facilitate the development or field evaluation of new motor vehicle safety features,” “facilitate the development or field evaluation of a low-emission motor vehicle,” and to avoid “prevent[ing] a manufacturer from selling a motor vehicle whose overall level of safety is equivalent to or exceeds the overall level of safety of nonexempted motor vehicles,” in addition to the economic hardship exemption created by the 1968 law. This general exemption authority is currently codified at 49 U.S.C. § 30113.

In its petition for exemption, GM argued that its Cruise Origin vehicles should be exempt under two FMVSS exemption bases because the Origin provides an overall safety level at least equal to that of non-exempt vehicles and exempting the battery-electric Origin would make development of a low-emission vehicle easier.

In its response to the GM petition, the San Francisco Municipal Transportation Agency (SFMTA) urged NHTSA to condition approval of the Cruise Origin exemption on 12 requirements involving data sharing, vehicle design, and operations, repeatedly referencing the operational problems Cruise had experienced in San Francisco. While conceding that it “does not have the technical expertise to conclude that the absence of fatal crashes from the testing to date of the Cruise AV signals superior driving,” SFMTA urges NHTSA to “launch a rulemaking proceeding to prescribe minimum standards for performance of all automated driving systems operating on public roads.”

The operational mandates SFMTA suggests to NHTSA would have been better directed at California’s state and local regulators (including SFMTA itself), which have the clear authority to regulate the operations of any vehicles on their public roads—unlike NHTSA, which is authorized to regulate motor vehicle safety and performance and not the operation of those vehicles.

With respect to SFMTA’s request that NHTSA develop new regulations on automated driving system (ADS) performance, those rules will need to reference consensus technical standards that are still under development. Regulating ADS performance in the absence of consensus standards through the development of government-unique standards is both extremely challenging due to limited regulator technical expertise and explicitly discouraged by the National Technology Transfer and Advancement Act of 1995.

Like San Francisco, the National Association of City Transportation Officials (NACTO) requests that NHTSA put the regulatory cart before the technical standards horse with respect to ADS performance. But NACTO goes further, urging NHTSA to deny GM’s petition by alleging several socioeconomic and environmental problems well beyond the purview or expertise of safety vehicle regulators at NHTSA in addition to claiming GM has not proven the Cruise Origin’s safety equivalence to non-exempt vehicles.

On the safety equivalence claim, NACTO appears to misunderstand what NHTSA is supposed to evaluate. The main question NHTSA will be investigating is, does exempting the Origin from specific FMVSS preserve the safety equivalence with a compliant Origin? For example, would removing the Origin’s rearview mirrors degrade safety when compared to an Origin with rearview mirrors? Given the lack of historic crash data due to the novelty of the Cruise Origin and NHTSA’s limited tools to evaluate ADS performance, the extremely high standard of safety proof that NACTO demands is unlikely to exist in the near-term. Worse, adopting NACTO’s interpretation of NHTSA’s exemption authority would likely prevent any exemptions for ADS-equipped vehicles and deny NHTSA the data needed to develop eventual minimum performance requirements, effectively short-circuiting the process NACTO claims to support.

Not all big city transportation stakeholders have expressed skepticism toward NHTSA granting GM’s exemption petition. The San Francisco Chamber of Commerce urged NHTSA to approve GM’s petition. So too did the National Federation of the Blind. In contrast to San Francisco, Phoenix, Arizona, Mayor Kate Gallego personally wrote to NHTSA supporting GM’s petition, stating that Phoenix officials believe deployment of the Cruise Origin would help promote “a thriving environment, livable communities, enhanced productivity, and bustling commerce.”

Academic AV experts have also offered their support for GM’s exemption petition. Kara Kockelman, the Dewitt Greer Centennial Professor of Transportation Engineering at the University of Texas at Austin and one of the world’s most prominent AV scholars, wrote to NHTSA to express her “very strong support of GM and Cruise’s request for temporary exemptions,” citing the potential safety, congestion, environmental, and social equity benefits of the Cruise Origin.

To be sure, the benefits of AVs extend will extend well beyond dense urban cores. But the responses to GM’s Cruise Origin exemption petition suggest the benefits to urban cores may not be distributed evenly. This may have less to do with the performance of the AVs and the features of the built environment and more to do with the varying political enthusiasm for deploying AVs among officials in particular cities.

» return to top

Undercutting Users-Pay/Users-Benefit

A number of governors from both parties are touting their temporary suspension of state fuel taxes in the run-up to the November election. Most of them say this won’t harm highway finances because they are drawing on higher-than-expected federal money (from the Infrastructure Investment and Jobs Act or left over from various COVID-19 relief measures). That may fool some, but those federal dollars could have been used for net new investment, rather than paying for politicians’ gas-tax holidays.

When gas prices were nearly $4 per gallon, Florida’s populist Republican Gov. Ron DeSantis, got the legislature to approve a 25 cents per gallon gas tax holiday for the month of October, leading up to the November election, where he’s seeking a second term. In late August he upped the ante by also using federal dollars to compensate for temporary cuts in the toll rates on Florida’s Turnpike and other state-run toll roads. For six months beginning Sept. 1, 2022, customers on state-run toll roads are eligible for discounts of 22% to 25% (if they have SunPass transponder accounts). At least the three independent metro-area toll agencies (in Miami, Orlando, and Tampa) are exempt from this political grandstanding. And why isn’t the Florida Department of Transportation objecting? Its leadership is appointed by the governor, so they must remain silent.

Adding implicit support for these measures, Transportation Secretary Pete Buttigieg told a House Transportation & Infrastructure Committee hearing in July that general fund transfers are “a legitimate way to fund highways.” According to Politico’s account of the hearing, he left open the question of whether Congress should retain a users-pay approach in the future.

Several previous Democratic administrations have wanted to convert the federal Highway Trust Fund into an all-purpose transportation trust fund, but Congress has never signed on to that idea. The concept would be that while highway users would continue to pay, the revenues would be distributed to Amtrak, bicycle networks, and anything else that could conceivably be considered surface transportation. That is a recipe for poorly funded roads and highways.

It is critically important for those of us who want a robust, state-of-the-art highway system to retain and restore not just users-pay but its corollary, users-benefit. The eventual transition from per-gallon fuel taxes to per-mile charges provides a once-in-a-century opportunity to restore the users-pay/users-benefit paradigm, converting the highway system into a utility, analogous to water supply, telecoms, and electricity.

» return to top

Clearing Debris from Highway Lanes, Safely

Debris in active traffic lanes is a hazard to moving vehicles and to state DOTs whose crews must get out of their vehicles to remove it. All too often, these workers get injured or killed by moving vehicles. In a 2016 study, the AAA Foundation for Traffic Safety identified an average (over four years) of 50,000 annual crashes into roadway debris, leading to 10,000 injuries and 125 deaths.

At the annual meeting of the International Bridge, Tunnel, & Turnpike Association (IBTTA) in August, I was intrigued to see a video of a better way (than an on-foot worker) to quickly and safely get debris out of traffic lanes. A company called J-Tech is now offering a device called LaneBlade that can be attached to a utility truck to push debris over to the breakdown lane. LaneBlade consists of a large center surface with “wings” on each end that keeps the debris from sliding to the side while it is being pushed. The company’s Fred Bergstresser told me that (mounted on a large enough truck), LaneBlade can move a disabled car, a refrigerator, a mattress, or even a fully loaded truck.

Not wanting to be seen as promoting a particular product, I asked him who their competitors are. There appears to be no commercial competition. One state DOT built its own Gator Getter to move “road gators” (truck tire treads) from roadways. A device aimed at small debris is called Debris Clear. That’s about it. Consequently, LaneBlade has been purchased by a number of DOTs, including those of Florida, Illinois, Ohio, Pennsylvania, Tennessee, and Texas.

I get no commission for writing this. I’m doing so because I’m impressed by this clever, life-saving device.

» return to top

News Notes

Toll Road Company Buys Stake in the Chicago Skyway Concession
Two of the three Canadian public employee pension funds that jointly own the 99-year concession to operate and manage the Chicago Skyway, a 7.8-mile toll bridge linking downtown Chicago to the Indiana Toll Road, are selling their stakes. Canada Pension Plan Investment Board and OMERS Infrastructure last month agreed to sell their combined 67% of the concession to Atlas Arteria, an Australian toll road company. Atlas is paying $2 billion for the two-thirds interest. The original 99-year lease valued the concession at $1.8 billion; the Atlas bid implies a $3 billion valuation of the concession. Ontario Teachers’ Pension Plan is retaining its one-third stake.

Warren Buffet Buys Majority Stake in Pilot/Flying J
Buffett’s investment company Berkshire Hathaway has acquired 80% of Pilot/Flying J, the largest truck stop operator in North America. Some analysts think Buffett is eying the company’s land holdings, on the assumption that automation may reduce the need for truck stops. An alternative view is that Buffett understands the ongoing shift to truck electrification and the need to expand the number and location of truck stops. With 80% ownership, Buffet could buck trade association NATSO which has strongly opposed allowing truck stops directly alongside long-distance Interstates. Buffet shook up freight railroads by purchasing BNSF and taking it private. Might he now be planning to shake up trucking and truck stops?

Georgia DOT Gets Qualifications from Three Teams for SR 400 P3
In the first of three major revenue-risk DBFOM concessions for express toll lanes, GDOT has received qualifications from three teams for the first project: adding express toll lanes to 16 miles of SR 400. The three teams are led by ASTM/Shikun & Binui, Cintra/Macquarie, and Meridiam/Acciona. The estimated cost of the project is between $2 billion and $2.4 billion, according to Public Works Financing. The concession term will be 50 years. The express lanes will include state-funded Bus Rapid Transit service in addition to toll-paying motorists.

TxDOT 10-Year Plan Devotes $85 Billion to Improved Highways
As one of America’s largest and fastest-growing states, Texas needs an expanded-capacity highway system. And that is what the new 10-year plan calls for. The expansion plans include I-35 through Austin and San Antonio and further expansions in the Dallas/Ft. Worth and Houston metro areas. In addition, $14 billion of the total is devoted to roadways in rural areas.

A Toll Truckway for the Port of Tacoma?
Washington State DOT is building two miles of toll lanes alongside I-5 linking the Port of Tacoma with SR 167. The $376 million project began construction in July. It’s part of the state DOT’s Puget Sound Gateway Program. Since much of the traffic to and from the port consists of drayage trucks, and the new corridor will charge tolls, this may become, de facto, America’s first toll truckway.

Chile Unveils $13 Billion P3 Portfolio
The Ministry of Public Works last month unveiled its plans for large-scale public-private partnership (P3) projects for 2022-2026. About $4.6 billion of the total will be dedicated to unfinished portions of the Pan-American highway and its accesses to nearby cities, via 12 separate projects. The plan also includes long-term concessions to improve four regional airports.

Denver Tollway Unveils 3-Year Widening Project
The E-470 Public Highway Authority announced the beginning of a third-laning project (each way) along 11 miles of this ring road around the eastern half of the Denver metro area. The 47-mile toll road runs from I-25 South to I-25 North and passes near Denver International Airport in the metro area’s eastern suburbs. The $350 million project began its initial construction phase in late September.

Gateway Tunnel Will Cost $16 Billion, Be Completed in 2035
The new tunnel beneath the Hudson River, bringing Amtrak and commuter trains from New Jersey to Manhattan, is already over budget and very late, before it even begins construction to replace the aging tunnel that was damaged by Hurricane Sandy in 2012. The poor performance of U.S. transit rail tunnels and light rail projects is analyzed in a new report from the Eno Center for Transportation, “On the Right Track: Rail Transit Project Delivery Around the World.” It documents that the United States pays far more per mile for such projects than the average of 10 peer nations overseas. The report singles out Chile, Italy, and Norway for best practices and more bang for the buck.

Battery Swapping May Work for Commercial Vehicles
An article in The Economist (Aug. 27) explains the pros and cons of a system developed by Taiwanese firm Gogoro, which allows subscribers to exchange a depleted battery from a moped or scooter. A consortium of Japanese vehicle producers is considering a similar service for electric delivery vans and light trucks. This appears to be a good fit for local commercial electric trucks that are on the road all day and require frequent recharging but does not appear to be a good fit for personal EVs, which have many different sizes and makes of battery and need recharging much less often.

Israel Plans New Express Toll Lanes
An interagency request for qualifications (RFQ) was issued last month for three new express toll lane projects in Israel. The project is envisioned as a 29-year DBFOM concession for the express lanes and includes the development and implementation of a tolling system. Qualifications are due Dec. 15. Israel has one operational express toll lane project—the only one outside the United States. The express lanes will include express bus service and incentives for three-person carpools.
 
Werner Planning 24/7 Automated Long Haul Truck Service
Trucking company Werner Enterprises and technology company Kodiak Robotics announced a partnership on Sept. 29, aiming at autonomous long-haul truck operations with human drivers handling only the first-mile pickup and last-mile delivery portions of the trip. The agreement came after a week-long pilot project in which a Kodiak-automated truck (with a safety driver) operated four round trips between Dallas and Lake City, FL. The automation system is called Kodiak Driver. No specifics were announced about where and when the operations would begin without a human driver on the long-haul portion of such trips.

Setbacks for Electric Bikes and Scooters
Battery fires on e-bikes in New York City have led the city’s public housing authority to propose banning such bikes from their buildings. City firefighters have responded to 26 battery-based fires in public housing since 2021, Ars Technica reports. Elsewhere in the city, battery-based fires have resulted in 73 injuries and five deaths. Many e-bikes in New York are do-it-yourself conversions, which do not comply with UL battery safety standards. And in San Francisco, the city has proposed banning e-scooters from sidewalks, due to injuries to pedestrians. The only exception would be for scooter-share companies that use geofencing to disable scooters from operating on sidewalks.

Ground-Breaking for Toll Border Crossing Near San Diego
Last month saw the ground-breaking ceremony for a tolled border crossing at the Otay Mesa East port of entry from Mexico. The four-lane toll bridge is expected to decrease border wait times by 50%. Variable tolling will be used in order to reduce congestion. Toll rates for personal vehicles will range from $5 to $25 and for commercial vehicles from $15 to $45. Target date for completion of the project is Dec. 2024.

Correction to September Article
In September’s article “Canada Points the Way on P3s for Highway Rest Areas,” the number of years since the federal ban on commercial services at U.S. Interstate rest areas was mistakenly written as 72 years ago. Since the ban went into effect in 1960, the correct number is 62 years ago. This error has been corrected in the online edition of the September newsletter.

» return to top

Quotable Quotes

“This analysis is straightforward. Rhode Island has a legitimate—even compelling—interest in the maintenance of its ailing bridges. But there is no reason that interest cannot be served by a tolling system that does not offend the Commerce Clause. Indeed, many states have implemented tolling systems that fairly apportion their costs across various users and do not discriminate against interstate commerce. Applying strict scrutiny, Rhode Works’ tolling program fails the test.”
—Judge William E. Smith, in American Trucking Associations v. Alviti, in Jeff Davis, “Federal Judge Finds Rhode Island’s Truck Tolls on Interstate Bridges Unconstitutional,” Eno Transportation Weekly, Sept. 23, 2022

“Let us reset the clock and stop forcing battery electric cars into the market. Instead, we should focus on reducing emissions from the cars we can produce without creating a completely new business ecosystem and infrastructure that will be controlled by China. Hybrid vehicles that charge themselves looked like the perfect place to start 20 years ago, and, in my book, it is still the best option we have right now. We learned a hard lesson with ‘Dieselgate,’ which is that if you set unreachable goals, but at the same time make it economically impossible for companies to hit these goals, businesses will cheat. It’s either that or go out of business. Passing a law that makes it impossible to sell a car that does not have zero emissions at the tailpipe turns the car business over to those who will pollute the air from their countries, beyond the reach of US and EU courts and totally unresponsive to climate activists.”
—Michael L. Sena, “Batteries: Theme of the Next Mad Max Dystoposeries,” The Dispatcher, Oct. 2022

“Self-driving ‘all the time, everywhere’ hasn’t stalled. It’s always been and always will be a pipedream. (I’ve never been able to drive my own car ‘all the time, everywhere’ even though Madison Avenue has forever suggested that I can (or should be able to if I wasn’t such a …) Self-driving doesn’t need to be ‘all the time, everywhere’ because there is a driver in the car. Let them do the driving at times and places where the system doesn’t work very well. In fact, more should be done to not allow them to drive either in heavy snow, torrential downpours, dense fog, when they are tired, when they’ve had too much to drink, smoke, or snort. We need to get to a point at which Driverless (self-driving in an operational design domain—ODD) actually delivers safe origin to destination mobility in some ODD that delivers real value to society. Let’s define the ODDs where this technology does work. Put it to work there and begin recouping some value from all the sunk investment. Then focus on the most efficient and effective way to grow the ODDs such that they most expeditiously generate the most value to society,”
—Alain Kornhauser, “Why Self-Driving Cars Have Stalled” Smart Driving Car.com, Sept. 12, 2022

» return to top

The post Surface Transportation News: Priced managed lanes rebound from pandemic, vehicle electrification concerns, and more appeared first on Reason Foundation.

Manchin countered that, “for years, I’ve worked to fix our broken permitting system, and I know the (Biden) administration’s approach to permitting is dead wrong.″

Manchin called Thursday’s vote “a step in the right direction” but said the measure likely “is dead on arrival in the House. That’s why I fought so hard to secure a commitment (from Democratic leaders) on bipartisan permitting reform, which is the only way we’re going to actually fix this problem.″

Manchin thought he had bipartisan support for the permitting reform bill he refers to, but Senate Minority Leader Mitch McConnell (R-KY) whipped Republican votes against the bill, causing Manchin to pull it.  

While Manchin’s bill would’ve delivered some incremental progress on permitting, it was far from the thorough reforms needed. Over the past two years, we’ve seen a growing number of studies comparing the very high costs of major U.S. infrastructure projects with comparable projects in Europe and Japan. Like the United States, these countries also all have environmental laws that infrastructure projects must comply with, but studies show Italy and France can build new subways faster and for about half the costs per mile as U.S. subway projects. This suggests something is seriously wrong with America’s environmental review process.

A significant factor identified by researchers as driving the higher costs is the massive role of the “citizen voice” in the review process for U.S. projects. Frequently cited on this topic is a 2019 study by George Washington University’s Leah Brooks and Yale University’s Zachary Liscow, which sought to explain why the cost per mile of building U.S. Interstate highways tripled between the 1960s and 1980s. 

Citizen litigation to prevent or redesign highways came about not via the National Environmental Policy Act (NEPA) of 1970. The key factor was a 1971 Supreme Court ruling—Citizens to Protect Overland Park v. Volpe—that citizens could sue administrative agencies over environmental impacts. Brooks and Liscow estimate that citizen voice litigation is a significant factor in forcing expensive design and location changes that helped cause the tripling of per-mile costs in the United States.

A growing number of liberal and centrist critics have recently published articles lamenting the obstacles to needed infrastructure imposed by the “citizen voice” in this country. They include Ezra Klein in The New York Times, Jerusalem Demsas in The Atlantic, Matthew Yglesias in his Substack newsletter, and many others. 

Construction unions have also picked up on this problem, such as this comment by James T. Callahan, president of the International Union of Operating Engineers: 

“Since its modest beginnings, NEPA has evolved into a massive edifice, capable of destroying project after project, job after job, in virtually every sector of the economy. Dilatory strategies employed by project opponents frequently exploit provisions in NEPA, weighing down projects, frustrating communities, and raising costs to the point that many applicants, whether public or private, simply walk away.”

Sen. Manchin’s well-meaning bill pretty much ignored this major problem. It included a statute of limitations for court challenges, maximum timelines of two years for NEPA reviews, and an “improved process” for categorical exclusions under NEPA. But there was nothing that would overturn numerous court decisions that have empowered citizen litigation.

Another problem is that Manchin’s measure was limited to energy projects. Highway and mass transit projects are also generally subjected to endless citizen litigation. A more consequential bipartisan reform aimed at getting needed infrastructure projects approved more efficiently would have to include all infrastructure categories.

Another major problem was the bill’s reliance on “administrative earmarking.” Had the bill passed, it would have directed the president to “designate and periodically update a list of at least 25 high-priority energy infrastructure projects and prioritize permitting for these projects.” This would be a recipe for high-powered lobbying for projects that might fail a benefit/cost analysis but could offer lucrative contracts for companies and unions. Earmarking is earmarking, whether done by the legislative or executive branches of government, and it plays a harmful role in politicizing the infrastructure project selection process. 

The U.S. needs meaningful permitting reform. The country seems primed for a broad, centrist coalition that recognizes the need to build and modernize infrastructure and supports streamlining environmental reviews of energy and transportation projects. This potential coalition could include supporters of highway expansion in fast-growing states, mass transit projects in dense urban areas, wind and solar projects in blue states, and natural gas and nuclear projects in red states. 

Basic statutes such as the National Environmental Policy Act and the Clean Air Act would likely not be subject to change. Instead, the focus of the reform effort would be on curtailing the extent of citizen litigation, drawing on the lessons being learned by research done by entities like the New York University Marron Institute’s Transit Cost Project and similar work from the Eno Center for Transportation.

I am not aware of specific reform measures that would adequately address this problem, so considerable work must be done. Part of the answer might be challenging key court decisions that have empowered citizen litigation. An important element would be specific federal policy changes for Congress to enact.

A diverse group of research organizations, such as the American Enterprise Institute, Bipartisan Policy Center, Breakthrough Institute, Brookings Institution, Hoover Institution, and Reason Foundation, along with the above-noted Eno Center and Marron Institute, could play valuable roles in these types of issues. 

If reform proposals are developed, energy and transportation organizations should also mobilize to support legislation to implement the recommendations. In the transportation sector, I’m thinking of groups like the American Association of State Highway and Transportation Officials, the American Road and Transportation Builders Association, the Associated General Contractors, and others, along with construction trade organizations and other unions.

With infrastructure construction costs escalating at a much faster rate than the Consumer Price Index, there’s a real danger that the increased federal funding in the Infrastructure Investment and Jobs Act, also known as the bipartisan infrastructure bill of 2021, could fail to lead to much actual expansion of infrastructure—unless there is meaningful streamlining of the environmental, permitting and litigation process. 

While Sen. Manchin’s bill didn’t address many of the critical problems and ultimately failed, it is notable that there’s a growing coalition that recognizes that policy reforms are needed to address the excessive obstacles blocking key infrastructure projects. Centrists in both major political parties acknowledge that needless delays, bureaucracy, and litigation are increasing taxpayers’ costs and preventing the U.S. from modernizing and building 21^st-century energy projects, highways, mass transit, and more housing. Now, researchers and Congress need to develop substantive policy and legislative solutions to start removing obstacles and addressing them so the country can build the infrastructure it needs. 

A version of this column originally appeared in Public Works Financing.

The post Finding consensus on environmental and permitting reforms to build needed infrastructure appeared first on Reason Foundation.

RAISE grants follow in the footsteps of the Transportation Investment Generating Economic Recovery (TIGER) and the Better Utilizing Investments to Leverage Development (BUILD) grants. While some of the evaluation criteria changed, the name change is more of a branding exercise. This year, 936 project sponsors applied and 166 projects, or 18%, were provided funding. 

According to USDOT, RAISE grants “help urban and rural communities move forward on projects that modernize roads, bridges, transit, rail, ports, and intermodal transportation and make our transportation systems safer, more accessible, more affordable, and more sustainable.”

That goal seems reasonable. However, for the 50% of the program directed to urban areas, the criteria seem to boost non-highway projects in urban areas: 

Projects were evaluated on several criteria, including safety, environmental sustainability, quality of life, economic competitiveness and opportunity, partnership and collaboration, innovation, state of good repair, and mobility and community connectivity. Within these areas, the department considered how projects will improve accessibility for all travelers, bolster supply chain efficiency, and support racial equity and economic growth—especially in historically disadvantaged communities and areas of persistent poverty.

As I have outlined previously (here, here, and here, as well) any federally funded transportation grants should have several minimum requirements. First, the projects should be related to transportation. When the Department of Education awards grants, for example, it does not examine habitat preservation. The Department of Transportation should focus its review criteria on transportation goals and needs. Second, federal grants should support national infrastructure projects. Highways, airports, freight rail, and passenger rail are national in scope. Ideally, the grants should have clear policy goals. For example, the G.W. Bush Urban Partnership Agreements (UPA) and Congestion Reduction Demonstration Program (CRD) grants had a specific focus on reducing congestion. 

To determine whether the RAISE grants meet these minimum requirements (national, related to transportation, focused), we built a spreadsheet of all 936 project sponsors that applied for funding. Given that in past years, grants were overwhelmingly awarded to members of Congress on the transportation and funding committees, as well as members of the sitting president’s party in swing districts, we examined committee membership as well. Table 1 details these characteristics. 

Table 1: Fiscal Year 2022 RAISE Grant Awards 

Of the 166 projects awarded RAISE grants, just 90 projects, or 54%, were directly related to transportation. In terms of being in the national interest, only 17 (10%) of the federally-funded projects met that criterion. In fact, the projects that were not funded were more likely to be related to transportation or in the national interest than projects that were funded.

There was not a specific focus of the project. There were “conventional” projects such as bridges, airports, and freight rail projects. There were also “novel” projects, including those that connected communities, green infrastructure, electrification, and traffic calming. By awarding funding to so many different types of projects, the federal grants don’t prioritize any specific goal, such as reducing traffic congestion on Interstate highways. 

However, the 2022 RAISE grants did perform better than in past years in the politicization aspect. While 37% of funded projects were in districts of members who are on the House Transportation Committee and/or Appropriations Committee, 34% of projects overall were in those congressional districts. Projects located in a district of a member of Congress on a relevant committee were not more likely to receive funding, however—a change from earlier rounds of grants. And members of the Senate Transportation (including Banking, Commerce, and Environment and Public Works) and Appropriations committees were less likely to have funded projects, than members of the Senate overall. 

There may be a couple of reasons for the committee membership findings. This program is heavily backed by leadership, and leadership did receive a disproportionate share of projects, so it doesn’t matter whether rank-and-file members’ projects were funded. It’s also possible that the program has become so popular that the administration does not think Republicans will do much to change the program when they regain control of Congress. (It’s important to remember that former President Donald Trump made only minor changes to the TIGER Program when he assumed control.)

Finally, the Infrastructure Investment and Jobs Act, or the bipartisan infrastructure bill of 2021, was not written and passed through the normal committee process. As a result, congressional committee members likely had even less influence on the final bill’s language than they would’ve through the typical process. In fact, despite Democrats controlling Congress, only 47% of the RAISE grants approved in 2022 went to Democratic-held districts.

For comparison, our review of the 2021 fiscal year RAISE grants found:

Of the 90 projects funded with Rebuilding American Infrastructure with Sustainability and Equity grants in 2021, only nine projects (10%) were national in nature. Of the 90 projects funded by RAISE grants, 50 projects, 56%, were related to transportation. The other projects funded were primarily focused on environmental remediation, economic development, or other factors. Of the projects not selected, 496 (74%) were related to transportation. Of the 90 projects funded, 41% were located in congressional districts represented by members of a transportation or financing committee. Only 15 of the 90 projects funded by RAISE, or 17%, were projects submitted by a state government

Despite the many problems with the RAISE grants, there were some worthwhile transportation projects funded by them this year. Maine received funding for improving the I-95 at Hogan Road Improvement Project. Ohio received funds to improve U.S. 6 in the Sandusky area, a major arterial. The Port of Los Angeles received funding for a freight rail bridge to ease goods movements.

But for each of those projects, there are also projects getting grants that harder to explain to federal taxpayers, such as a shared-use path in the Hartford area, a complete streets project in rural Oklahoma, and the electrification of a transit garage in Wisconsin. 

Going back, at least the last three presidential administrations have failed to allocate discretionary federal grants to their best uses. The Biden administration continues to award funding to projects that are neither transportation-related nor in the national interest of federal taxpayers.

The current RAISE program lacks a clear objective. Until policymakers and political leadership at the U.S. Department of Transportation are serious about developing a grant program that uses quantitative metrics to prioritize projects that could help solve national transportation problems, Congress should consider stopping the program that has largely become an executive branch earmarking tool. 

The post Federal RAISE grants continue to fail to prioritize key transportation projects appeared first on Reason Foundation.

Richmond, California, has begun offering innovative, on-demand transit service to many of the city’s residents that could serve as a model for other areas. The Richmond Moves shuttle, provided in conjunction with transit-technology startup Via, is one type of solution that could help public transit meet the needs of 21st-century transit riders. 

Richmond is a city of 116,000 residents located on the Eastern shore of San Francisco Bay, north of the Bay Bridge. Per capita income in the city is below California’s statewide average, and the poverty rate is 13.9%, far higher than cities like San Francisco and San Jose, suggesting that many of Richmond’s residents could benefit from low-cost transportation alternatives. 

To use Richmond Moves, riders use a smartphone app to arrange a pickup from one of the service’s three Chrysler Pacifica plug-in hybrid minivans. The app tells the passenger where to go to meet the van, typically within a couple of blocks of his or her current location. Currently, the system’s service zone includes a 5.6 square mile area in which average household incomes are relatively low. Vans can also drop off and pick up at the city’s ferry terminal and at a Bay Area Rapid Transit (BART) station in the neighboring city of El Cerrito.  

The fare is a flat $2, with seniors and students riding for free. To attract riders, Richmond Moves is also offering 10 free rides to all passengers during its startup period. 

The app, developed and maintained by Via, provides a similar user experience to apps offered by ridesharing companies like Uber and Lyft. Users can enter their credit or debit card numbers as a source of payment or input a voucher code provided by the city. 

Initial funding for the service came from a $1 million grant from the California Air Resources Board funded by the state’s cap-and-trade program. The grant covers two years of Richmond Moves’ operating costs.

To extend the service to a larger geographical area or beyond two years, Richmond will have to find additional grant funding from public and private sources, rely on farebox revenues, or tap into city general revenues. Other cities in the vicinity, such as Emeryville and Walnut Creek, offer fixed-route, free shuttle services that are municipally funded, but Richmond has serious financial challenges that would likely restrict its ability to fund a project like this. 

Denée Evans, Richmond’s Transportation Services Project Manager who oversees Richmond Moves for the city, told me: 

The City of Richmond has a robust set of regional multimodal options running through it, including BART, Amtrak, AC Transit fixed route buses, and ferry service to San Francisco.  This microtransit service improves local first mile / last mile connections and fills in transit deserts which can greatly improve mobility for residents of Richmond. Through the Richmond MOVES program, the city transportation department can provide additional support to seniors, low-income and disadvantaged communities who need more affordable and accessible transportation options. 

As a “first mile/last mile” option, Richmond Moves enables passengers to begin or complete their transit trips on other transportation modes that do not stop close enough to their origins or destinations. Evans does not see the service as a competitor of fixed-route bus services and noted that local bus operators, AC Transit and WestCAT, had not expressed any concerns about Richmond Moves. 

Evans also sees opportunities to integrate Richmond Moves’ technology with the city’s paratransit services and to directly serve passengers who use wheelchairs. To that end, she plans to add a 12-seat wheelchair-accessible vehicle to the system’s fleet in the coming months. The new vehicle and additional services will be funded by a $250,000 grant from the Federal Transit Administration. 

Because Richmond Moves’ current service area already includes Kaiser Permanente Richmond Medical Center, it is also an option for area residents seeking to access medical care or visit friends or relatives at the hospital. 

Micro-mobility solutions, like the one being tested by Richmond Moves, are likely to offer a more cost-effective answer to contemporary transit needs and are the types of experiments that transit agencies should be trying more of. 

The post A flexible, on-demand transit option being tested in Richmond appeared first on Reason Foundation.

• How “citizen voice” helped triple the cost of Interstates
• Canada points the way on modernized highway rest areas
• Truck automation developers take on tough problems
• Bus yard P3 captures value for transit
• Metro Silver Line to Dulles Airport: the truth comes out
• Countering the “freeway fighters”
• News Notes
• Quotable Quotes

New Study Documents the Impact of “Citizen Voice” on Highway Construction

Economists have documented that the real cost per mile of constructing Interstate highways tripled between the 1960s and 1980s. A study by Leah Brooks of George Washington University and Yale University’s Zachary Liscow looks into what factors led to this increase—and suggests that the rise of “citizen voice” seems to have played a key role.

Their 2019 research digitized annual state-level construction spending per mile of Interstate from 1956 to the 2010s. The major cost increase was in place by the 1980s. The report finds that it was not due to increases in the costs of labor or materials during those years. What did increase dramatically was real per-capita income and housing prices, which suggests that more-affluent households demanded more expensive highways (e.g., noise walls) and/or were more effective at “voicing their interests in the political process” in the post-70s era. Among their findings on this is that land-use litigation explains about a quarter of the increase in costs.

A key factor in enabling “citizen voice” to affect the construction of Interstate highways was the 1970 National Environmental Policy Act (NEPA) which requires environmental reviews of projects with significant federal funding. But it was not just the statute itself. In 1971, the Supreme Court ruled (in Citizens to Protect Overland Park v. Volpe) that citizens could sue administrative agencies over environmental impacts. Brooks and Liscow don’t discuss the cost of lengthy delays imposed by ever-more-complex environmental reviews, but those delays (assuming the project eventually gets approval to be built) do add to its cost. Their focus is on the high cost of changes to highway design that result from such litigation, for which they find empirical evidence.

Besides presenting statistical data on the increased use of noise walls, circuitous routing, elevated and depressed sections, and more on- and off-ramps, they also illustrate with a case study. I-696 in Detroit was built in two sections, the first in the 1960s and the second in the 1980s, at three times the cost per mile. The latter faced “decades of opposition” from citizen groups, leading to a final design that depressed the entire leg and built three 700-foot-long plazas decking over the highway, plus noise walls along most of its length.

Brooks and Liscow do not argue that these kinds of changes were unwarranted. One can argue that the initial Interstates imposed negative externalities on adjacent areas that were not compensated for those bearing the burdens. The question many thoughtful commentators are now asking is whether the empowerment of endless litigation by opponents of projects has gone too far, sometimes killing beneficial infrastructure improvements in transportation and energy infrastructure.

Back in March, Ezra Klein had a lengthy opinion piece in the New York Times along these lines, as did Jerusalem Demsas in The Atlantic. Even legislators in deep blue California have begun questioning the state’s version of NEPA (CEQA) for preventing new housing and green infrastructure projects.

No one is arguing for the repeal of NEPA or CEQA. The question is whether citizen-voice litigation has gotten out of control. The noteworthy Transit Costs Project at New York University’s Marron Institute has found that those European countries with significantly less-costly transit megaprojects have little or no citizen litigation but have strong environmental review laws. If we ever get back to bipartisan federal policymaking, there might be a critical mass of support for reforming NEPA, as a compromise between advocates of needed energy infrastructure (high-voltage transmission lines, solar power fields, pipelines) and advocates of needed transportation infrastructure (highways, transit, and occasionally airport runways).

» return to top

Canada Points the Way on P3s for Modernized Highway Rest Areas

Inframation News (Aug. 10, 2022) reported that Alberta Transportation (the province’s transportation agency) has issued a Negotiated Request for Proposals (NRFP) for the development and operation of Commercial Safety Rest Areas along its major highways. Proposals are due Jan. 9, 2023, and a shortlist will be announced in March, with preferred proponent(s) selected in April.

Like the United States, Canada has minimally-equipped rest areas, and in Alberta the majority “have low utilization by the traveling public due to a lack of amenities and inadequate washroom facilities,” according to the NRFP. The agency envisions a long-term public-private partnership (P3) lease agreement with one or more proponents for the 18 rest areas to be redeveloped. Potential commercial services include car and truck fuel, electric vehicle (EV) charging, convenience store, and quick-service restaurant facilities.

This sounds a lot like what U.S. toll roads have been doing over the past decade or so. As I documented in a March 2021 Reason policy study, six major toll roads (including Florida’s Turnpike, the Indiana Toll Road, and the New York Thruway) have entered into 30-35-year P3 leases to redevelop their service plazas, contracting with commercial providers such as HMS Host and Areas USA. These are basically design-build-finance-operate-maintain revenue-risk (DBFOM) P3s in which the private partner finances and rebuilds the facilities based on the projected revenues over the term of the lease agreement (with some revenue shared with the toll road owner). Private investment in these projects ranges from double-digit millions for smaller toll roads to $450 million for the New York Thruway’s 27 service plazas.

This would be an appealing proposition to many state DOTs, which lack any dedicated revenue source to maintain or redevelop their minimal-service Interstate highway rest areas. That’s because providing commercial services at those rest areas is still illegal under a 62-year-old statute that bans commercial services at those rest areas (but exempts toll roads). That ban has only two supporters: the American Trucking Associations (ATA) and the National Association of Truck Stop Operators (NATSO). By contrast, the Owner-Operator Independent Driver Association (OOIDA) has long supported repealing this archaic ban.

There are two urgent reasons to repeal the ban (which is in Section 111 of Title 23 of the U.S. Code): the growing shortage of safe overnight parking for long-distance trucking and the need for electric vehicle charging on long-distance Interstates.

The ongoing growth of e-commerce means more trucks on the road than ever before. ATA and OOIDA note that for every 11 truck drivers nationwide there is only one truck parking space. Investors such as Timber Hill Group are gearing up to invest in truck parking, but they can’t do that at Interstate rest areas due to the federal ban. Truck parking is particularly tight along major freight corridors, David Heller of the Truckload Carriers Association told TransportDive back in May. State transportation departments cannot afford to expand their Interstate rest areas, but investors might well be willing to do so, if that became legal.

The other need is for electric vehicle charging facilities on long-distance Interstates. In public comments on the Federal Highway Administration’s (FHWA) new $5 billion program to help states pay for adding EV charging “along” (i.e., within one mile of) rural Interstates, a number of state DOTs have asked for waivers so they could install EV charging facilities as those rest areas, owned and operated by private companies, not the state. The trucking industry wants far more powerful EV chargers for its big rigs, ideally rated at over 1 MW vs. 350 KW suggested in the federal guidelines. That’s more than they are likely to get, unless it’s part of an investor-financed P3 that would make the most sense to be located at Interstate rest areas.

One of these days, ATA and NATSO are going to have to bite the bullet and concede that the 62-year-old ban on commercial services has outlived its usefulness. Meanwhile, it will be interesting to see what happens in Alberta. Will U.S.-based Flying J (a NATSO member in good standing) join a consortium to bid on Alberta commercial-service rest area modernization?

» return to top

Truck Automation Developers Take on Tough Problems
By Marc Scribner

Last month’s issue discussed the continued progress and challenges with heavy truck automation (“Autonomous Trucks Making Progress—But Aren’t There Yet”). While “we are not yet ready for fully autonomous commercial service,” developers appear to be increasingly focusing on the practical operational issues that must be addressed prior to commercial deployment, including emergency fallback, interactions with first responders, and adverse weather conditions.

For an automated driving system (ADS) to qualify as Level 4 as defined by SAE International’s consensus standard J3016—with Level 4 being the level of automation at which human operators can be eliminated (in certain operational design domains)—the ADS must be capable of automatically performing a fallback to a minimal risk condition (i.e., “a stable, stopped condition”) in the event of an ADS failure. In May, a leading developer of Class 8 Big rig automation, Kodiak Robotics, announced it was deploying such functionality in its test vehicles. “There’s over 1,000 metrics the truck is constantly monitoring many times per second,” Kodiak CEO Don Burnette told Forbes. “If anything becomes abnormal, if there’s any diagnostic that triggers, then the Fallback kicks in and is safely able to bring the truck to a safe stop on the side of the road; then that system can ask for help remotely from our remote operations.”

But once ADS-equipped vehicles are stopped, they may not be able to resume operation with the assistance of a remote operator, as Burnette says, such as after a collision or mechanical failure that renders the vehicle inoperable. In those cases, police and firefighters may be the first to respond to the scene. This raises numerous questions as to how these first responders should safely interact with a disabled ADS-equipped truck. ADS-equipped trucks will also need to be able to identify and pull over for emergency vehicles. The broader automated vehicle industry has been working on first responder interaction plans for several years and some jurisdictions now require that these plans be filed prior to on-road testing.

In late June, Embark, another developer of Class 8 truck automation, conducted a public demonstration with the Texas Department of Public Safety and Travis County Sheriff’s Office on a stretch of SH 130 outside of Austin where sheriff’s deputies successfully completed a traffic stop of an Embark truck. Emily Warren, Embark’s head of public policy, told FleetOwner that the company’s emergency vehicle interaction capability “was designed to work seamlessly within existing law enforcement workflows, without requiring new training or technology investment by first responders.”

Embark’s “Autonomous Truck Law Enforcement Interaction Procedure” provides more detail on the mechanics involved. When a law enforcement vehicle behind an Embark truck activates its lights, Embark’s ADS first alerts a remote technician to request confirmation that a traffic stop has been initiated. If the remote technician does not respond within a certain window, the ADS makes the default assumption that the truck is being pulled over and exits the roadway onto the shoulder. Decals on the outside of the truck provide an Embark support phone number, a digital display indicates whether the truck is safe to approach, and an exterior combination lockbox contains required documents such as registration, proof of insurance, and bill of lading. With the assistance of a remote technician, the law enforcement officer on the scene can be guided over the phone to complete the traffic stop. To see it in action, Embark has produced a narrated video of the SH 130 demonstration.

One of the most challenging operational hurdles facing commercial deployment of automated trucks is adverse weather. As was discussed in this newsletter in April (“Could Automation Replace Most Long-Haul Truck Drivers?”), a recent study found that restricting automated truck operations to the 11 Sun Belt states largely free of snow and ice would impact only 10% of human truck driver operator-hours in the U.S.

In May, Embark reported successful trials of its Vision Map Fusion technology conducted on snowy Montana roadways in winter 2022. On a 60-mile route between Clinton and Missoula, Embark found that its technology would allow for it to meet acceptable shipper delivery windows 90% of the time in conditions with up to one-sixth of an inch per hour snowfall and one inch of roadway snowfall accumulation. Its Vision Map Fusion technology relies heavily on cameras to account for degraded LIDAR performance during moderate snow events.

These advances show automated truck developers are serious in deploying nationwide in real-world conditions. However, much more work remains to be done for commercial deployments to be viable. One area to watch relates to emergency signals for stopped trucks. When drivers must pull their trucks over to the side of the road, federal regulations (49 C.F.R. § 392.22) require that they place warning triangles or flares 100 feet in front and behind of their trucks within 10 minutes of stopping. This poses obvious compliance problems for driverless trucks, and it is so far unclear how automated trucks will meet this requirement, among others that presume a human driver is present and capable of exiting the cab to perform necessary duties.

» return to top

Potrero Bus Yard P3 Would Capture Value for Transit
By Baruch Feigenbaum

When investors examine public-private partnership opportunities, they don’t typically consider California the land of opportunity. While the State Route 91 express toll lanes project in Orange County was the first transportation P3 in the country, the Golden State has been in a dry spell. Most P3 projects in California have several challenges to overcome. Complicated environmental rules make building any piece of infrastructure challenging. And the Professional Engineers in California Government (PECG), the union for Caltrans engineers, has fought most P3s like they’re an existential threat.

However, California’s self-help counties (with their own dedicated transportation sales taxes) have been more adept at navigating environmental rules. And PECG does not represent their employees. Los Angeles Metro converted the I-10 and I-110 high-occupancy vehicle lanes to high-occupancy toll lanes using a design-build-operate-maintain (DBOM) P3. And the San Francisco Municipal Transportation Agency (SFMTA, also known as MUNI) is in the process of procuring the Potrero Bus Yard project, one of the most innovative P3 transit projects to date.

Built in 1915, the Potrero Bus Yard is situated on 4.4 acres. SFMTA maintains six bus routes that served 100,000 MUNI customers (2019 pre-COVID number) from the yard. Originally operated as a streetcar facility, the yard can accommodate 138 40-foot and 60-foot buses. However, MUNI is transitioning to an electric vehicle fleet. And the building, which is more than 100 years old, has long been obsolete; it does not meet current seismic or safety standards. Given the city’s density, SFMTA cannot expand the size of the yard or find new land to build a new facility. Therefore, SFMTA needs to modernize the facility to accommodate electric vehicles.

In 2019, SFMTA announced the Potrero Yard Modernization Project P3 that will replace the two-story maintenance building and bus yard with a modern, three-story, efficient bus maintenance and storage garage. In addition to modernizing the bus yard, the project is designed to address another one of San Francisco’s major problems: housing. The project adds 575 residential units of housing to the bus yard making it a rare residential/industrial mixed-use project.

The project has made steady, albeit somewhat slow, progress. In Aug. 2020, SFMTA issued a request for qualifications. In December, SFMTA shortlisted Potrero Mission Community Partners led by John Laing and Edgemoor, Potrero Neighborhood Collective led by Plenary US, and Potrero Yard Community Partners led by Fengate. In April 2021, the agency issued a request for proposals. In Jan. 2022, teams responded to the RFP and in June SFMTA requested revised proposals from the teams led by John Laing and Edgemoor as well as the team led by Plenary.

Most importantly, the political establishment is behind the project. The San Francisco Board of Supervisors approved a special exemption from the city’s administrative codes and voted to advance the project.

In many ways, a bus yard is the ideal 2022 transit public-private partnership project. Compared to its pre-COVID-19 numbers, rail ridership has dropped by as much as 70% while bus ridership is only down 40%. And those buses need some place to be stored overnight and maintained. Even in the six legacy rail cities (Chicago, Boston, New York City, Philadelphia, San Francisco, Washington D.C.) a far higher percentage of commuters have returned to buses compared with rail. This trend is partly because transit-dependent riders, who are more likely to use buses, tend to have occupations, such as store clerk or machinist, that require a physical presence. Transit-choice riders, who are more likely to use trains, are more likely to have jobs that allow them to work from home at least part of the time. Given that federal funds incentivize construction rather than the maintenance of transit lines, local operators need to maximize the use of innovative financing for bus maintenance.

But there are two other non-transportation reasons why these projects are likely be attractive. The first is environmental. Many transit agencies are converting their buses from internal combustion engines run on diesel to battery-electric power. While buses powered by electricity are problematic in very hot climates, many cities including San Francisco don’t have to worry about these types of weather challenges. The federal government is also incentivizing the purchase of electric buses with the Infrastructure Investment and Jobs Act’s $10.25 billion Grants for Buses and Bus Facilities Formula Program. Many environmentalists who do not traditionally support transportation projects, see this P3 as an opportunity to increase the share of electric vehicles. Others are happy to support any program that does not expand roadway capacity.

The second group supporting the project is advocates for more housing. The median price of a house in San Francisco is around $1.5 million. The average rent for a one-bedroom apartment is about $3,600 per month. The P3 requires the winning bidder to build half of the 575 residential units being added to the yard as “affordable” to those with moderate income. And while the 575 overall units are a drop in the bucket of needed housing in the area, building more of these projects across the city and the whole Bay Area, in addition to some needed zoning reforms, could start to create enough new housing to make a difference. Often, advocates for low-income housing do not support P3s. But a P3 that builds affordable housing in the most expensive major city in the country is too good to ignore.

» return to top

Metro Silver Line to Dulles Airport—the Truth Comes Out

Many years ago the cost of extending the new Silver Line heavy rail project to Dulles International Airport and beyond appeared to be well beyond the funds available to the Washington Metropolitan Area Transit Authority, the regional transit agency that runs the Washington, D.C., metro system. The alternative analysis that WMATA prepared was criticized for stacking the deck in favor of heavy rail by only assessing bus rapid transit-lite and no-build as alternatives. An obviously more cost-effective alternative would have been adding express toll lanes to the Dulles Toll Road and offering express bus service on them. It was also believed by knowledgeable transportation observers that the Federal Transportation Administration scoring of WMATA’s request for grant funds was fudged so as to make a poor project eligible for funding.

But a complete funding package for the massive $4 billion heavy rail project was still unresolved in 2005. Under Virginia’s pioneering Public-Private Transportation Act of 1995, the Virginia Department of Transportation (VDOT) accepted unsolicited proposals from potential private partners (such as the 2002 proposal for what became the I-495 express toll lanes P3). As a means of covering Virginia’s likely share in the Silver Line project, VDOT was open to “asset recycling” P3 proposals for the Dulles Toll Road, in which private companies might make a large up-front payment to long-term lease the Toll Road (with promised improvements), and VDOT could use the up-front payment as part or all of its share of the Silver Line construction cost.

As Public Works Financing reported in its Nov. 2005 issue, five P3 teams made proposals. Four offered up-front payments to help pay for the Silver Line expansion: Autostrade, Haney Company, Transurban, and Cintra. A fifth proposal from developer Christopher Walker proposed adding express toll lanes to the Toll Road, I-66, and SR 28 as an alternative to extending the rail line to the airport. But the next month, aiming to pre-empt those private-finance proposals, the Metropolitan Washington Airports Authority (MWAA) proposed that it take over the Toll Road and use increased toll revenue to pay for the heavy rail project. Its aim was to be sure the Silver Line actually got built all the way to the airport. The proposal caught VDOT and the private bidders by surprise. MWAA sent its proposal not to VDOT but to the state Rail and Public Transportation Department, as well as then-Gov. Mark Warner and Gov.-elect Tim Kaine. Despite concerns over the legality of shifting the Toll Road to MWAA, Gov. Kaine in March 2006 signed an agreement that shifted the toll road and made MWAA responsible for completing the $4 billion project based on toll revenues.

The public rationale for making toll road customers pay for the rail line was that the Silver Line would get many people off the toll road because they would switch to the Silver Line to get to the airport. The deal put MWAA in charge of managing the huge construction project and the power to enact increase after increase in toll rates to pay for the escalating costs. MWAA had no experience building a rail line, and its shortcomings in project management led to construction flaws and change orders that increased the overall cost. The toll to travel the full length of the Dulles Toll Road was just $1.25 at the time the deal was signed. After many years of increases, the MWAA board in May discussed yet another increase, to $6.00.

But now, with the line close to opening at Dulles Airport, the truth about the rationale for the deal comes out. In a Washington Post interview (Aug. 27) with airport director Richard Golinowski, we find the following questions and answers:

Q: “How will the opening of the second phase of the Silver Line [to the airport] affect Dulles?”
A: “It’s going to be good for the airport. I think, ultimately, it will bring more employees to the airport than it will passengers. But that’s good. If we can get employees to the airport more easily—transporting them via public transportation rather than driving on the roads every day—I think it’s going to be good for the area.”

Q: “Why won’t more passengers use it? Is it because it’s such a long ride from downtown DC?”
A: “I don’t think it’s a time thing. I think it’s quite frankly, it’s a luggage thing. People don’t want to carry luggage on the Metro. They’d rather drive or take an Uber, take a taxi or have somebody drive them to the airport with their luggage.”

Thanks for coming clean on this, Richard. That was just as true in 2006 as it is now. A fine time to tell us.

» return to top

Countering the “Freeway Fighters”

An anti-highway group called StrongTowns.org last month released “10 Recommendations for Freeway Fighters,” described as answering the need for ammunition by those working on “the relocation or removal of highways in American cities.” Author Jay Arzu provides brief descriptions of the 10 points, which I summarize here so that state transportation departments and other members of the highway community can know what may be coming at them.

Rule #1: “Highway-to-boulevard projects should focus on neighborhood reconnection and reinvestment for current residents of the area,” Arzu writes. This seems to assume that the current residents are the same ones there when the freeway was built 40 years ago; it is mainly an argument against “gentrification”—i.e., keeping the residents in place rather than offering them buyouts so that economic development can occur (assuming the freeway is actually removed).

Rule #2: “Any plan to remove a highway must include the input of local residents, and must employ Diversity, Equity, and Inclusion in design, implementation, and construction,” StrongTowns says.
DEI is the current buzzword used by some for social planning, rather than letting residents make their own decisions on what is best for them. He also recommends letting a social-activist group speak for all the residents, rather than finding out what individuals, families, and business owners prefer.

Rule #3: “Traffic data will always be used as an excuse for why a highway shouldn’t be removed,” says Arzu. As if disrupting urban area travel patterns would have no impact on thousands or millions of other people? And commercial vehicles?

Rule 4: “Trust your city’s street grid.” Street grids can increase or restrict mobility depending on how they are configured and managed. There is nothing inherently better in whatever the current grid happens to be.

Rule 5: “Create visuals/renderings showcasing the opportunities for your city if the highway was [sic] removed.” Pretty pictures are designed to be persuasive, but they may not reflect what is actually doable or affordable.

Rule 6: “When you remove a highway, traffic will not come!” This is a mantra of the Congress for a New Urbanism, and the historic examples it cites are not removals of entire freeways but tear-downs of stubs of freeways that were never completed (e.g. the stub of Central Freeway in San Francisco and the stub of the Park Freeway in Milwaukee). Those making this argument—that if you remove capacity the traffic will disappear—also argue that the “iron law of freeway congestion” says that if you add lanes, they will quickly fill up and be congested. Neither is generally true, and one claim contradicts the other.

Rule 7: “Get the development community on your side.”
In this telling, developers are the friends of teardowns. Yet most developers want to build profitable projects (i.e., gentrify under-developed areas).

Rule 8. “Land trusts/banks are a huge asset.”
Land trusts and land banks require financial and development expertise that is unlikely to be present in “community-based organizations.” And what is left out of this recommendation is the owners of the properties in the relevant area, who probably don’t want their properties turned over to a land trust or land bank.

Rule 9: “In the long term, take control of MPOs and DOTs.”
Well, MPOs and DOTs, don’t say you weren’t warned!

Rule 10: “No highway is permanent!”
True, highways wear out and need to be rebuilt, the same as bridges, water and sewer systems, etc. His example of the removal of Harbor Drive in Portland is highly misleading since it was replaced by brand new I-5, which runs parallel to former Harbor Drive, which was turned into Waterfront Park.

» return to top

News Notes

Maryland Express Toll Lanes OK’d by FHWA
After some initial dithering that aroused fears of political stonewalling, FHWA on Aug. 26 issued its Record of Decision formally approving the final Environmental Impact Study. Sources told Reason that concerns raised by opponents about the MDOT’s traffic & revenue study were evaluated by DOT experts and found to be groundless. MDOT and the Accelerate Maryland Partners P3 coalition have been under way on preliminary work via a pre-development agreement (PDA). The consortium hopes to reach financial close on the long-term concession for the project by year-end. The $5 billion project will replace the aging American Legion Bridge on I-495, adding express toll lanes to it, which will continue northward to I-270 and extend along that Interstate to Frederick, M.D.

Puerto Rico Seeking P3 Lease of Four Toll Roads
In latest example of U.S. transportation asset recycling, the Puerto Rico Public-Private Partnerships Authority (P3A) has issued a Request for Qualifications for P3 consortia that would finance, upgrade, operate, and maintain PR-20, PR-52, PR-53, and PR-66. As with the P3 leases of the Chicago Skyway and Indiana Toll Road, the P3A seeks to maximize the upfront payment in order to reduce the outstanding debt of the state’s bankrupt Highways & Transportation Authority.

Cintra Proposes Express Toll Lanes on I-77 South of Charlotte, N.C.
North Carolina DOT has revealed the identity of the company that submitted an unsolicited proposal several months ago to add express toll lanes to I-77 from downtown Charlotte to the South Carolina border. The proposal is being reviewed by the Charlotte Regional Transportation Planning Organization (CRTPO) at NCDOT’s request. Cintra is the primary company in the consortium that financed, built, and operates express toll lanes on I-77 north of Charlotte. That project was controversial during the planning and construction phases but has delivered the traffic flow and congestion reduction that was promised. The new project will cost an estimated $2.3 billion, which Cintra has said it could finance based solely on projected toll revenues.

Macquarie Selling Its Stake in Goethals Bridge Concession
Inframation News reported last month that Macquarie Asset Management is seeking bids from potential investors in its 40-year P3 concession that replaced the aging Goethals Bridge between New Jersey and Staten Island. Macquarie is seeking to sell its 90% stake in the concession, and the likely buyers are infrastructure investment funds. Since construction was completed in 2018, there is no longer construction cost risk, and the value of the remaining years of the concession will be a function of operating and maintenance (O&M) risks. There is minimal revenue risk, since the project was financed based on availability payments from the Port Authority of New York & New Jersey, the bridge’s owner.

PennDOT Faces Bridge Replacement Funding Problem
Due to a new law that restricts new tolls on all lanes of a highway in Pennsylvania, PennDOT’s plan to use a toll-financed DBFOM P3 to replace nine major bridges on Interstate highways in the state now faces a financial problem: where to find $2.8 billion, the estimated cost of replacing the nine bridges. Thus far, the preliminary development agreement (with Bridging Pennsylvania Partners, led by Macquarie) is still in force, enabling preliminary work to continue. The P3 could still be used, financed by availability payments, but PennDOT would have to identify 40 or 50 years’ worth of funds it could dedicate to the P3—which would come from somewhere else in its budget.

New Jersey Launches MBUF Pilot Project
NJDOT is recruiting volunteers to take part in the state’s first pilot project to evaluate a mileage-based user fee replacement for its per-gallon gasoline and diesel taxes. As in other MBUF pilot projects in the eastern half of the United States, motorists will be given a device that plugs into the OBD port beneath the dashboard to record miles driven, with either a GPS or non-GPS option. That parallels the multi-state pilot project that I participated in several years ago, managed by The Eastern Transportation Coalition. In the New Jersey pilot, volunteers will receive up to $100 for completing the project.

San Francisco HOT Lanes Network Is Expanding
More high-occupancy/toll (HOT) lanes will open by the end of the year on 22 miles of US 101 between Redwood City and the San Francisco Airport (SFO). This is the second phase of a project that encompasses US 101 in both San Mateo and Santa Clara Counties. The system uses switchable transponders; with three or more people in the vehicle, there is no charge, but variable tolls are charged for two-person and one-person vehicles. Certain categories of “clean air vehicles” get discounted tolls.

Kansas and Oklahoma Shifting to Cashless Tolling
Over the next two years, the Kansas Turnpike Authority intends to eliminate cash toll payments, removing 20th-century toll booths and collecting all tolls via either KTAG transponders or license-plate imaging and billing. The Oklahoma Turnpike Authority is doing likewise, and last month completed conversion to cashless on its Chickasaw Turnpike. Already converted are the Kilpatrick, Kickapoo, and Bailey Turnpikes. The OTA completion date is 2024, the same as in Kansas.

Toll Road Widening Under Way in New Jersey
Evidently, someone didn’t clue in the New Jersey Turnpike and Atlantic City Expressway that senior officials at FHWA prefer increased maintenance to capacity additions. Gov. Phil Murphy last month approved the NJ Turnpike’s $4.7 billion plan to widen the toll road’s extension to the Holland Tunnel, a notoriously congested segment. And the toll-funded Atlantic City Expressway is planning and designing a widening project in Camden and Gloucester County.

Dubai Toll Operator Initial Public Offering
Bloomberg News reports that Salik, the company that provides toll collection services for the Dubai expressway system, is planning an initial public offering of shares in September. The company has said it hopes to raise $1 billion via the IPO.

User Cost per Mile or User Cost per Time Saved?
In a thoughtful empirical study, Robert Bain and Sylvain Senechal question the widespread use of toll charge per mile as the best measure to use in a value for money (VfM) analysis of toll roads. They suggest that this metric is not very useful, compared with measuring the value of time saved. They present data comparing these two metrics for an array of U.S. toll roads, showing that some provide poor value for the money spent by their customers. The paper, which was published in the September issue of Infrastructure Investor, is online and can be downloaded at no charge.

Automated-Only Lanes Authorized in Michigan
Gov. Gretchen Whitmer in July signed a law that allows Michigan DOT to designate some roadway lanes for autonomous vehicles only. At best, this appears to be premature. Highway lanes are costly to build and maintain, and adding such lanes when there are basically no automated vehicles (AVs) in regular use would appear to be a poor use of limited highway dollars. The alternative of converting an existing lane to AV-only poses the practical problem of shifting all the cars, trucks, and buses that currently use that lane into other lanes, increasing their congestion levels. This is also the primary drawback of converting a GP lane to a bus-only lane. Unless there is very frequent bus service with high load factors on each, the result will be fewer passenger miles per hour in the converted lane.

Possible Extension of SH 288 Express Toll Lanes
The relatively new express lanes (called the Brazoria County Expressway) on SH 288 heading south from Houston may be extended further south, eventually to Houston’s outer ring road, the Grand Parkway. The Houston Chronicle reports that county officials are looking into the feasibility of an initial extension past Meridiana.

SANDAG Moving Forward with Added Road User Charge
The San Diego Association of Governments (SANDAG) has received approval from the California Air Resources Board (CARB) of its $172 billion Regional Transportation Plan. The plan includes a highly controversial county “road user charge,” which officials admit is an added tax that will be used largely for non-highway projects. While CARB said the plan complies with air quality regulations, it asked “how, if at all, the revenue estimates in the Plan are expected to change as a result of the [SANDAG] board’s direction to remove the road user charge.” The road user tax would be in addition to the state gasoline tax and a planned state road user charge, contrary to the growing number of state pilot projects that explicitly envision such charges as replacing, rather than adding to, existing fuel taxes.

Questions for Amtrak’s Board
In a Sept. 6 opinion piece, the Eno Center for Transportation’s Jeff Davis offers three questions the U.S. Senate should ask the Amtrak board nominees. The questions all relate to Amtrak’s bizarre not-private/not-government status that enables it to operate behind closed doors in ways that neither a publicly traded business nor a government agency can do. Needless to say, these are also subjects that Congress should be addressing.

» return to top

Quotable Quotes

“The community-input process is disastrous for two broad reasons. First, community input is not representative of the local population. Second, the perception of who counts as part of the affected community tends to include everyone who feels the negative costs of development but only a fragment of the beneficiaries. . . . Even a demographically representative community meeting would systematically err on the side of blocking vital infrastructure. The downsides of new development tend to be very localized: loud noises from construction, or an obscured view. As a result, opponents can easily find one another and form a political bloc. By contrast, the beneficiaries are either unknown at the inception of the project . . . or extremely diffuse . . . . The political coalition broadly in favor of new housing, transit, and renewable energy exists, but not at the project-by-project level. This asymmetry means that opponents of a new project will always have the upper hand.”
—Jerusalem Demsas, “Community Input Is Bad, Actually,” The Atlantic, April 22, 2022

“[Amtrak has] ridership issues on many existing routes while promoting unrealistic ideas for route expansion that are likely to deepen already-existing operating losses . . . . Amtrak executives receiving huge bonuses right now only furthers Committee Republicans’ ongoing concerns with the taxpayer-subsidized passenger railroad. Amtrak has time and again shown that it isn’t a good steward of taxpayer funds, and Congress needs to ensure that going forward it uses this funding more responsibly.”
—Rep. Rick Crawford (R-AR), “Bonus Bashing,” Politico, Aug. 10, 2022

“Today the DC circuit court released its decision, siding with the Federal Communications Commission, on its reallocation of part of the 5.9GHz band. It’s a big win for the FCC and a big loss for the auto industry, which has promised to use the airwaves to improve safety through a technology called ‘vehicle-to-vehicle’ (V2V) or ‘vehicle to everything’ (V2X) communication. The problem, as hilariously put by Judge Justin Walker in his opinion, is that this technology has never really existed. It was one of those ‘just around the corner’-type innovations that has always been promised but never actually delivered. It was a fantasy, and today the court’s basically said as much.”
—Andrew J. Hawkins, “The Auto Industry Lost Its Spectrum Fight with the FCC because V2V Was Always a Fantasy,” The Verge, Aug. 12, 2022

“Let’s be clear: the work of science has nothing whatever to do with consensus. Consensus is the business of politics. Science, on the contrary, requires only one investigator who happens to be right, which means that he or she has results that are verifiable by reference to the real world. In science, consensus is irrelevant. What is relevant is reproducible results. The greatest scientists in history are great precisely because they broke with the consensus. There is no such thing as consensus science. If it’s consensus, it isn’t science. If it’s science, it isn’t consensus. Period.”
—Michael Crichton

» return to top

Correction: This post has been updated to note the ban on commercial rest areas is 62 years old, not 72.

The post Surface Transportation News: Citizen voice raises costs of Interstate construction, modernized highway rest areas, and more appeared first on Reason Foundation.

To its credit, BART publishes hourly station entrances and exits by station pair on its website. For each hour, the data set shows how many individuals traveled between any two named stations throughout the system. By classifying stations by the side of San Francisco Bay in which they are located, it is possible to estimate the number of hourly trips passengers took beneath the bay. 

If cross-bay ridership in any given hour approaches the system’s capacity, there is a case for adding capacity by, for example, adding a second tunnel. But, if usage is well below capacity, large capital expenditures to increase capacity are not warranted. 

While ridership varies widely across days and times, it is best to focus on the busiest travel times, which have historically been the morning and evening rush hours. Suppose the existing tunnel is reaching maximum capacity. In that case, a new tunnel may be needed irrespective of usage during less busy periods (although authorities might also consider negotiating arrangements with large employers to stagger employee hours, implement variable fares to deter peak travel, or use other techniques to lower utilization during peak periods). 

Today, the theoretical capacity of the single BART San Francisco Bay tunnel is 48,000 passengers per direction per hour based on a maximum of 24 trains per hour, 10 cars per train, and 200 passengers per car (representing what BART officials call “crush capacity” with standees packed into each car like sardines). For various reasons, not the least of which is passenger comfort, planners should try to avoid approaching this theoretical maximum.  

BART is already investing in a capacity increase. By upgrading its train control system and purchasing more rolling stock, the system should be able to run 28 cars in each direction under the Bay by 2030, raising the theoretical maximum to 56,000. This upgrade project, known as the Transbay Corridor Core Capacity Program, has an estimated cost of $2.7 billion, including $1.2 billion in federal funding. 

I examined BART ridership data for the last eight years to determine whether a second tunnel is needed. For each month between January 2015 and July 2022, I found the highest single hour of cross-bay ridership, as shown in the accompanying chart. Between 2015 and the pandemic’s beginning, peak hour usage hovered around 30,000—comfortably below today’s theoretical maximum.

However, the data shows a slight upward trend, even though BART’s total ridership declined during this period. Further, the all-time peak of 33,794 was reached recently in May 2019. This evidence supports the need for the Core Capacity Program, and possibly, during the pre-pandemic period, may have made the case for the second tunnel.

However, as one would expect as the COVID-19 pandemic really hit the United States in March 2020, BART's peak hour ridership declined sharply in March and April 2020.

Over the past two years, ridership has been recovering slowly. There was a significant bump in June 2022, but that was the result of East Bay residents traveling to San Francisco to join in on the Golden State Warriors NBA championship parade and not indicative of any regional commuting trend. 

In July 2022, BART's peak hourly cross-bay ridership was just 27% of the level reached in July 2019. This percentage is considerably below the 34% to 35% levels BART reported for all-day ridership on most Tuesdays, Wednesdays, and Thursdays in July.

BART computes its ratios by comparing overall daily ridership in July 2022 to pre-pandemic levels. The difference between the ratio I calculated and those reported by BART is consistent with the intuition that, in the current pandemic era, work and travel patterns are more varied, with the share of riders using mass transit for their traditional morning and evening commutes falling as a percentage of total trips. 

To determine whether building a second transbay tunnel is a wise investment of public funds in the coming decade, one must answer two questions: Will overall system usage return to and then exceed BART's pre-pandemic levels? And will BART's ridership once again become more concentrated at rush hour peaks?

Mounting evidence suggests that the answer, at least to the first question, is no. 

In the early months of COVID-19, most urban planners worked on the assumption that there would be a discrete end to the pandemic, after which offices would reopen, workers would return, and BART would rapidly recapture most of its lost ridership.

That discrete ending may have appeared to be in sight during the COVID-19 vaccine rollout early in 2021. But, instead, the pandemic has been prolonged as new COVID-19 variants emerged, Bay Area case levels experienced multiple spikes, and many workers have resisted returning to offices.

Now, it looks like there will not be a clear or sudden end to the pandemic, but rather a gradual transition to endemicity, with COVID-19 remaining a background threat to many, including those with underlying health risks and conditions, for the foreseeable future. 

Given the combination of COVID and new technologies, remote work has become the norm rather than the exception for many types of employees, especially in the Bay Area. According to a survey of mid-size and large public firms conducted by the San Francisco Standard, "More than half of the 73 mid-size and large public firms with headquarters in San Francisco said their office workers can work remotely full-time for the foreseeable future, according to publicly available company information, employee interviews and job postings." Most other companies intend to use a hybrid model where employees work on-site fewer than five days per week. 

Another factor limiting commuting is the slowdown in technology industry employment growth. We may be reaching the end of the megatrend toward increased use of online technologies leading into the pandemic and then accelerated by it as people avoided in-person contact. Now that most people have become willing to return to physical stores and restaurants, technology utilization is flattening along with the demand for software engineers.

The Mercury News recently reported, "In an unsettling trend, some tech companies such as Apple, Google, Facebook app owner Meta Platforms and Tesla have revealed plans to pause or scale back hiring amid ongoing economic uncertainties."

"The rebound from the pandemic appears to be losing steam, and hiring is clearly slowing in the tech sector,” Mark Vitner, senior economist with Wells Fargo Bank, told the Mercury News.

It is possible that local technology hiring could rebound in the coming years, and it is also possible that San Francisco’s economy could experience a rotation in which another growing industry sparks a new round of employment growth. But current evidence suggests that the number of individuals commuting to work in downtown San Francisco may not return to 2019 levels for decades, if ever. 

As to the second factor that determines needed BART capacity under the Bay—whether commute times will once again become concentrated during the typical rush hours of 8-10 am and 4-6 pm— less evidence is available. However, we know from surveys conducted by Adobe Corporation and others that many employers have adopted flexible work schedules since the onset of the pandemic and that employees would like to see them go further in this direction.

So, the traditional 9-to-5 workday and its concentrated commuting pattern may become a thing of the past. Other research suggests that inbound commuting times are becoming more variable post-pandemic than outbound commutes, but, in the case of BART, inbound passenger volumes were more concentrated than outbound volumes, so this trend will most likely lead to the two commute peaks balancing out at much lower levels. 

While we should not completely rule out the need for a second Bay tunnel someday, the $29 billion required to build it could undoubtedly be reprogrammed to support other infrastructure projects that have a far greater chance of benefiting the Bay Area in the near-to-intermediate future.

The post Ridership data and work trends continue to undermine the case for a second BART tunnel  appeared first on Reason Foundation.

• New study quantifies value of Interstate highways
• Spurious objections to Maryland’s express toll lanes
• Texas returns to HOV lanes
• FRA re-proposes flawed crew-size mandate
• Autonomous trucks making progress—but aren’t quite there yet
• Are highway workers “pedestrians”?
• News Notes
• Quotable Quotes

New Study Quantifies Value of Interstate Highways

Economists over the years have used various methods to estimate the economic benefits of highways, especially the Interstate Highway System, which introduced a nationwide system of limited-access super-highways comparable to Germany’s autobahns and Italy’s autostrade. As econometric methods become increasingly sophisticated, it’s not surprising that recent years have brought forth new, improved studies of this sort.

The latest is a working paper from the National Bureau of Economic Research, with the rather bland title of “Highways and Globalization.” Working Paper 27938 was produced by economists Taylor Jaworski, Carl Kitchens, and Sergey Nigai. The study is a big enough deal that it was featured in a Washington Post column on July 18, “The Most Valuable Interstate Highways.”

That headline and story are a bit misleading, implying that the study’s biggest finding—of annual economic benefits of $742 billion—is the total economic value of those highways. Actually, the modeling in the paper is limited to only goods movement on the Interstate system, including trade among the 48 contiguous states and imports and exports via seaports and border crossings with Canada and Mexico.

The authors built a detailed econometric model of the flow of goods over the entire federal and state highway network, taking into account over 3,000 counties and the major seaports and international border crossings. They modeled trade flows on this network, taking into account known congestion levels and both first-best and second-best routes between origins and destinations. After calibrating the model using the entire U.S. highway system, they removed the entire Interstate highway system from the model and re-ran it. This enabled them to estimate the annual value added by the Interstate system—$602 billion in 2012 dollars, or $742 billion in 2021 dollars.

For a second counter-factual exercise, they re-ran the model 10 more times and in each run removed one of the 10 longest Interstates. Below I’ve included six of these, with the economic values updated to 2021 dollars.

Value of six major Interstates

From the table, we can see that the most productive Interstates for goods movement are I-80 and a near tie between I-70 and I-75. But in terms of trade value per mile, the productivity champs are I-75 and a near tie between I-5 and I-70.

Here are several points to keep in mind in assessing these results. First, I am not an economist, let alone an econometrician, so I cannot assess the validity of their detailed methodology. This is a working paper, so I’m sure other econometricians will be looking at the assumptions and equations and pointing out any shortcomings.

Second, these results apply only to the goods-movement function of the Interstates. Their value for personal travel—both urban and long-distance—is over and above what is estimated in this paper. And third, of course, there are one-time and ongoing externality costs of the Interstates, as highway critics keep reminding us. Comparing total annual benefits with total annual costs is not part of this paper, but my guess is that the total benefits far outweigh the total costs.

There is also the question of value for money. The cost of building the Interstates is reported as $114 billion, equivalent to $535 billion in 2020 dollars. For the system to yield economic benefits of over $700 billion per year just from better goods movement is astounding—it’s hard to find a larger return on investment in infrastructure. And with its reconstruction and modernization estimated at a one-time investment of $1 trillion by the Transportation Research Board’s special committee on the Interstate system’s future, that huge need is easier to justify as a means of preserving and increasing the Interstate system’s benefits going forward.

Spurious Objections to Maryland’s Express Toll Lanes
By Baruch Feigenbaum

Earlier this month, acting Federal Highway Administration (FHWA) Administrator Stephanie Pollack delayed issuing a record of decision on the final environmental impact statement (FEIS) for the Maryland Department of Transportation’s I-270/I-495 express toll lanes public-private partnership project. FHWA was expected to approve the FEIS on Aug. 5. In fact, as of this writing, the agency’s permitting dashboard still lists Aug. 5 as the target date. The project cannot move forward until this document is approved. The agency refuses to set a new date, announcing the review is “in progress.”

The Washington Post reported Maryland Gov. Larry Hogan “blasted federal transportation officials for delaying a decision that would have cleared the way for him to move forward with a plan to build toll lanes on Interstate 270 and part of the Capital Beltway, according to a letter he sent to the Biden administration.”

The Post added Hogan was “completely blindsided” and “chided the acting administrator of the Federal Highway Administration for failing to approve the state’s environmental plan.”

The project has been controversial from the start, especially amongst a large number of NIMBYs (not-in-my-backyard) who oppose most construction proposals in Montgomery County. For example, recently, neighbors in the Homewood neighborhood of Silver Spring were unable to build a sidewalk funded by the neighborhood association because a resident sued to stop its construction because it required tearing out a weed that the homeowner called his “emotional-support plant.” 

The current FHWA has seemed to be hostile toward highway projects that add lanes. It blocked the planned reconstruction of I-45 in Houston, for example. The I-45 project is also understandably controversial because TxDOT’s plan requires taking 1,000 homes. But, in contrast, Maryland’s I-270/I-495 managed lanes project does not condemn a single residential property. In another difference between the Texas and Maryland projects, while TxDOT is hamstrung by an inability to toll or use a P3, requiring its project to have a larger footprint and cost more, MDOT is not adding any general-purpose lanes and is proceeding in a staged approach to minimize the environmental footprint.

One of the groups leading calls for the delay is the Maryland Transit Opportunities Coalition, led by anti-highway, toll-lane critic Ben Ross, who claims to have uncovered fraud because the projected traffic volumes changed between the supplemental draft environmental impact statement (SDEIS) and the FEIS.

Ross’ criticisms center around four points. First, he is concerned that modeled traffic volumes on I-495 between I-270 and I-95 decreased since the SDEIS and argues that this is inconsistent with modeling. Yet the earlier model failed to take into account the number of vehicles that would use the new express toll lanes on I-270 taking that highway to the intercounty connector to reach I-95 north, foregoing the northern part of I-495 altogether. As a result, we would expect traffic volumes to decline somewhat on that portion of I-495. And that’s what the model shows.

Second, Ross questions why traffic on the eastern Beltway (I-95/I-495) between the Potomac River and I-95 would decrease if the managed lanes are built. Again, I believe the previous model did not consider that some traffic currently using the eastern Beltway will switch to the western Beltway (which is now congested at least six hours per day) when the managed lanes provide a congestion-free option between the Dulles Toll Road and the I-270 spur. If enough traffic shifts from the eastern Beltway, travel times would improve on that highway.

Third, Ross is convinced that hourly changes in traffic of 1% to 5% show some type of fraud. Yet, most of the traffic changes result from modeling improvements around the Greenbelt metro station, both in transit station access and local street construction. 

Finally, Ross raises concerns about traffic changes on several arterials. Let’s use MD 201—Kenilworth Ave.—as an example. He argues that if the model places fewer drivers on 201 north of the Beltway, other drivers will switch to 201. While that thinking makes sense from a regionwide perspective, it will not apply to every corridor. And Ross is cherry-picking the corridors to make his point. Perhaps 201 is only a better option for the current drivers. Maybe the long-term plan includes a road diet that will reduce the number of lanes on 201, making it less appealing for drivers. Maybe there are changes to the local street grid that Ross is not capturing.

One major factor that Ross never mentions regarding long-term traffic projections is post-COVID-19 commuting patterns. Workers have been slower to return to the office than some might have expected, reducing peak period car trips. The new modeling takes that into account.

During both EIS processes, MDOT had to use the Metropolitan Washington Council of Governments (MWCOG) traffic-demand model and have the results verified by staff as well as MDOT and FHWA career employees.

The project would help bring faster travel times for Maryland residents who are tired of sitting in traffic congestion on I-270 and I-495. Let’s hope FHWA won’t allow itself to be used as a political tool for NIMBYists.

As Gov. Hogan put it in a letter to President Joe Biden and Transportation Secretary Pete Buttigieg, “This has been called the most important and transformative transportation project for the National Capital Region in the last 50 years, and with so many Marylanders still stuck in soul-crushing traffic, we are not going to let politics delay it any further.”

» return to top

Texas Returns to HOV Lanes

In what seems like a return to the bad old days of unmanaged traffic, the Texas Department of Transportation (TxDOT) is planning to spend billions of scarce fuel-tax dollars adding carpool (HOV) lanes to congested freeways. And it’s disguising this effort by referring to them as (non-tolled) “managed lanes.”

I kid you not. For example, these non-managed HOV lanes are in TxDOT’s near-term plans for the eastern portion of the I-635 LBJ Freeway in Dallas (a $1.7 billion project), elevated HOV lanes on I-35 in San Antonio ($1.5 billion), and the I-35 Capital Express Central project in Austin ($4.9 billion). That means Texas is poised to spend over $8 billion on carpool lanes—a flawed and ineffective approach to traffic management.

I’m sure TxDOT fully appreciates the success of the existing express toll lanes in Dallas and Ft. Worth, which are serving numerous satisfied customers every day with faster and more reliable trips than they could get in general purpose lanes or HOV lanes. Alas, the powers that be in populist Texas these days have forbidden TxDOT to spend any money on new toll projects, which means priced managed lanes are forbidden for the foreseeable future.

Texas legislators should also know that HOV lanes have been a failure nationwide. My colleague Baruch Feigenbaum made this case in a new Reason policy brief released last month, “From Failure to Success: Converting High Occupancy Vehicle Lanes to High Occupancy Toll Lanes/Express Toll Lanes.”

HOV lanes were a 1970s idea aimed at saving fuel by reducing the number of people commuting alone. They began as bus-only lanes. That concept left the vast majority of an expensive new lane unused, so carpools were then allowed in—initially four or more people per car, which was soon reduced to three people per vehicle, and in most places down to two (many of which were actually fam-pools—which took no vehicles off the roads). As Baruch’s paper points out, empirical research found that most HOV lanes were either too full during peak periods (i.e., congested) or under-used (wasting expensive pavement). Not only that, during the 1980s and 1990s when most HOV lanes were built, carpooling shrank from 19.7% of commuters in 1980 to just 12.2% in 2000 and down to 9.7% in 2010.

As a result of this large-scale failure, building new HOV lanes pretty much ground to a halt after 2000. Increasing numbers of them have been and are being converted to high-occupancy toll (HOT) lanes—lanes with variable pricing to manage congestion but which let carpools of (usually) three or more people use them either at no charge or at a discounted toll. This has occurred with HOV lanes in Atlanta, Denver, Houston, Los Angeles, Miami, Minneapolis, North Carolina, San Francisco, Seattle, and the northern Virginia suburbs of Washington, D.C., among others. And some newly-built express toll lanes offer free passage only to super-HOVs (vanpools and buses). Such projects exist in Austin, Denver, Orlando, and on I-95 in Maryland.

These projects have been welcomed in blue states (California, Washington State), purple states (Minnesota, North Carolina, Virginia), and red states (Florida, Georgia—and 10 years ago, Texas). Variably-priced HOT/express lanes have a history of bipartisan support in Virginia, which is one of the pioneers of both HOT lanes and investor-financed HOT lanes, predating Texas’s former embrace of both.

With the levels of current and projected traffic congestion in Austin, Dallas/Ft. Worth and San Antonio, investor-financed HOT/express toll projects would likely be quite feasible, avoiding much of the $8 billion drain on TxDOT’s capital budget due to the ban on new tolls. When those new HOV lanes fail—either with too much or too little traffic—it will be too late to recoup their capital costs from new toll revenue, while $8 billion worth of other highway projects across Texas will have been postponed or cancelled due to the diversion of that $8 billion to build 1970s-style HOV lanes.

Note: In 2020 I presented a paper commissioned by the OECD’s International Transport Forum on the impact of HOV and HOT lanes on congestion in the United States. It is downloadable from the ITF website.

» return to top

FRA Re-Proposes Flawed Train Crew-Size Mandate
By Marc Scribner

On July 28, the Federal Railroad Administration (FRA) proposed a regulation that would require freight trains to have at least two crewmembers on board during operation, except for case-by-case approval of reduced-crew operations. If this sounds familiar, that’s because this requirement was proposed in 2016 and then withdrawn in 2019 due to a lack of evidence supporting the claim that multi-person freight train crews are safer than single-person crews. FRA has now revived the proposal while furnishing no new safety evidence.

It is, however, the fulfillment of President Joe Biden’s campaign promise to railway labor unions. Contrary to FRA’s statutory mandate, promulgating this crew-size rule will not meaningfully promote rail safety. It amounts to economic regulation masquerading as safety regulation. Worse yet, this rule would perversely harm the interests of railroad workers in the long run by making freight rail less competitive with increasingly automated trucks.

In 2016, when FRA first proposed such a minimum crew-size regulation, it conceded that “FRA cannot provide reliable or conclusive statistical data to suggest whether one-person crew operations are generally safer or less safe than multiple-person crew operations.”

This admission of FRA’s lack of data to support its proposed rule did not originate from FRA. Rather, it came from the White House Office of Management and Budget’s Office of Information and Regulatory Affairs (OIRA), which is the executive branch’s regulatory watchdog. The draft notice of proposed rulemaking that FRA originally sent to OIRA for review instead claimed, “Studies show that one-person train operations pose increased risks by potentially overloading the sole crew member with tasks.”

Despite the absence of evidence, FRA continued forward on the proposed crew-size rule until it was withdrawn in 2019. In its withdrawal notice, the agency concluded, “FRA’s statement in the [proposed rule] that it ‘cannot provide reliable or conclusive statistical data to suggest whether one-person crew operations are generally safer or less safe than multiple-person crew operations’ still holds true today.”

The 2019 withdrawal notice also contained a nationwide preemption order that was aimed at overriding several state crew-size laws, which had been enacted in recent years at the behest of railway labor unions. This was challenged in federal court by two railroad unions and three states. In Feb. 2021, the Ninth Circuit Court of Appeals ruled in favor of the challengers, finding that FRA failed to meet procedural requirements in issuing the preemption order. The court remanded the matter to FRA to reconsider the underlying issues. The timing of this decision was especially fortuitous for rail unions because FRA was now controlled by their political allies following President Biden’s inauguration a month earlier.

While on the campaign trail in June 2020, then-candidate Biden raised industry eyebrows when he explicitly promised in a special video for rail union executives that, if elected, he would be “requiring two-person crews on freight trains…to get [unions] the thanks, respect, and opportunities that [they] so richly deserve.”

FRA’s July 28 notice of proposed rulemaking (NPRM) makes good on that promise. Like the 2016 NPRM, FRA concedes that it does not possess “any meaningful data” to support the conclusion that two-person train crews are safer or that one-person crews are less safe. Its NPRM also appeals to the same two-decade-old anecdotes from Quebec and North Dakota that fail to provide a reasonable basis for the rule. Indeed, in the case of the 2013 Casselton, ND, accident, FRA’s own recounting of the incident in the new NPRM—”the conductor admitted that he had never been in a situation where a collision was imminent, did not know what to do, and therefore might not have gotten down on the floor and braced himself, as the locomotive engineer instructed”—works against the supposed safety basis of this proposed rule because one-person crew operations would have eliminated the on-board conductor who was put in harm’s way in Casselton due to his own inexperience with proper safety protocols.

While the process for obtaining permission to operate single-person freight train crews is designed to appear more flexible on paper than the 2016 proposal’s waiver process, approval is ultimately at the discretion of FRA political appointees. In an article for Railway Age (“Biden Promise Fueled FRA NPRM,” Aug. 2), longtime rail policy insider Frank N. Wilner explains why the proposed waiver process provides only the illusion of potential regulatory relief. “The FRA’s standards in the waiver process for Class I railroads are arguably designed to assure denial,” writes Wilner. “The FRA, already with its thumb on the scale, sets itself up as the judge over what are unspecified criteria for evaluation. An example is the definition of ‘catastrophic.’ It appears to encompass every event requiring an incident report, including derailments having nothing to do with crew activity.”

The re-proposed crew-size mandate cannot be justified on safety grounds, as required under the law. If finalized, rail carriers are sure to challenge this rule as arbitrary and capricious under the Administrative Procedure Act and exceeding FRA’s statutory authority from Congress. Rail unions undoubtedly view this as a major policy win for their narrow economic interests, but the rule is likely to be self-defeating for their members in the long run.

As discussed in a Sept. 2021 policy brief for Reason Foundation, the trucking industry is anticipated to automate in the coming years, which could reduce truck operating costs by roughly half. A two-person crew-size mandate would impose a perpetual rail labor cost floor, thereby disadvantaging freight rail to its increasingly automated trucking competitors. This would cause shippers to increasingly substitute trucks for rail, which would have economic, safety, and environmental consequences.

With respect to the environment, trucks emit far more pollutants. According to the Environmental Protection Agency (“2021 SmartWay Online Shipper Tool: Technical Documentation,” Table 12), when compared to freight rail, trucks produce approximately 10 times as much carbon dioxide, more than three times as much fine particulate matter, and two-and-a-half times as much nitrogen oxides per ton-mile. Despite its frequently professed commitments to reducing transportation’s environmental footprint, it appears the Department of Transportation under President Biden has made a choice to increase the emissions intensity of the transportation sector in order to reward a favored special interest.

As is always the case in politics, actions speak louder than words. Fortunately, Congress can rein in FRA’s abuse of power. Amending FRA’s statutory authority to prohibit crew-size regulation, defunding enforcement of this rule, and rigorous investigations and oversight should all be on the table.

» return to top

Autonomous Trucks Making Progress—But Aren’t There Yet

Last month, Kansas became the 38th state to enact a law that allows the deployment of fully autonomous vehicles on state highways (but it applies to vehicles up to 34,000 pounds, thereby excluding Class 8 big rigs that are the mainstay of long-distance trucking). The 38 state laws range from allowing full deployment and operation for all types of trucks to those that allow only testing with safety drivers.

While there are no Class 8s in regular operation on major highways with no one on board yet, regular operations of such rigs with safety drivers are taking place, with major carriers teaming with autonomy providers such as these:

• J.B. Hunt Trucking with Waymo automation
• U.S. Express with Embark automation
• DHL Supply Chain with Volvo Autonomy
• FedEx with Aurora automation
• UPS with TuSimple automation.

Hardly any truck automation developers plan to build autonomous trucks. Instead, they are partnering with the major original equipment makers (OEMs) such as Navistar (partnering with TuSimple automation), Daimler (with Torc automation), and both Paccar (maker of Kenworth and Peterbilt) and Volvo Trucks (with Aurora automation).

Also interesting is the emerging business model for long-haul automated trucking. FleetOwner reported in Jan. 2022 that both Aurora and Torc are moving toward a model in which a trucking company buys the Class 8 truck with automation as an option. If they buy it that way, the automation company will manage the autonomous portion of its operations, mostly on major highways such as Interstates. Aurora’s CFO Richard Tame explained their business model, which depends on avoiding the cost of a human driver in the truck. As he told FleetOwner, “We don’t have a commercial product with a driver because the sensors [lidar, radar, and camera] are so expensive. Having an expensive kitted-out truck with a safety driver is not a product.”

The trucking company would pay a per-mile fee for Aurora to operate the truck, which he estimated would be about half the cost of drivers. Hence, a win-win for both the trucking company and the automation company.

Yet despite the continued progress with on-road testing for commercial carriers, glitches still occur. The Wall Street Journal reported on Aug. 2 that a TuSimple big rig with a safety driver and engineer on board made a sudden left turn, cutting across I-10 and crashing into a concrete barrier. The article reported that TuSimple’s internal report blamed the accident on one of the onboard employees failing to reboot the automation system before turning the system on, leaving in place an outdated left-turn command. That this kind of error could occur in one of truck automation’s leading companies suggests that we are not yet ready for fully autonomous commercial service.

» return to top

Are Highway Workers “Pedestrians”?

Everyone is rightly concerned about recent increases in pedestrian deaths on and alongside roadways. But is that total being exaggerated by a data problem? The American Road & Transportation Builders Association (ARTBA) has been pointing this issue out for years, without the problem being addressed. (“Counting Vulnerable Road Users,” Brad Sant, Transportation Builder, May-June 2022)

The National Highway Transportation Safety Administration (NHTSA) is the source of data on pedestrian fatalities, and the data it reports include deaths of highway workers in work zones—but these deaths are not reported as a subtotal. The only other potential source is the Bureau of Labor Statistics (BLS), which seeks to report all on-the-job worker deaths. But according to ARTBA, isolating highway work zone deaths in BLS data is difficult since the BLS categories are by type of work performed, not by location.

The new IIJA legislation calls for state and federal agencies to deal with safety hazards for “vulnerable road users” (VRUs), whose definition in the law includes highway workers. The article reports that the VRU materials prepared for stakeholder meetings on VRUs earlier this year did not address the data problem noted above but noted that ARTBA participants reminded agency officials that highway worker deaths should not be hidden within the “pedestrian” category.

Effective measures to reduce fatalities of individuals on highways depend on accurate data on who, where, and why these fatalities occur. As Marc Scribner pointed out in the June issue of this newsletter, the new Safe Road and Streets for All grant program addresses fatalities that occur on only 47% of America’s roadway route miles—primarily county and municipal mileage. Despite being touted as the answer to rising “pedestrian” deaths, it is focused on less than half the problem. And since many highway work zones occur on state DOT miles, they are not even eligible for the one federal program aimed at reducing “pedestrian” fatalities.

In short, we have no idea what fraction of the record-high 2021 “pedestrian” fatalities were actually deaths of workers in highway work zones. Without that information, it is hard to figure out where it makes sense to allocate resources effectively to reduce that horrible toll.

» return to top

News Notes

Pennsylvania Legislature Bans Toll P3s
Following citizen lawsuits opposing PennDOT’s $2 billion plan to toll-finance the replacement of nine major Interstate highway bridges, the legislature enacted a sweeping revision of the state’s public-private partnership (P3) law for highways. It bans projects that would toll all lanes of a highway or bridge but allows tolls that are optional (as on newly built express toll lanes). Even that would require the permission of the legislature. While PennDOT hopes to proceed with replacing the nine aging bridges, it’s facing a major problem: where to find an additional $2 billion.

First Express Toll Lanes Project Proposed for New York State
On Aug. 4, Assemblywoman Michaelle Solages and the Long Island Contractors Association released a report proposing a P3 procurement of what would be the state’s first express toll lanes. The project would add an ETL each way along the 25.5-mile Southern State Parkway. The report refers to hazardous conditions on the parkway, including sharp curves, short on-ramps and off-ramps, too many small exits, and intersections with three major north-south highways. When it opened in 1927, the speed limit was 35 miles per hour and traffic volume was a small fraction of today’s level. New York state does not have a transportation P3 law, though the Port Authority of New York & New Jersey has done a number of large-scale P3 procurements.

San Diego Competition Has Three Finalists
SANDAG, the metropolitan planning organization for San Diego County, has selected three finalists in its competition for innovative public-private partnerships in transportation. One, from Beep and Balfour Beatty, would create mobility hubs served by autonomous electric shuttles. Cordoba Corporation (with a large team of others) proposed extending a current light rail line across the border into Tijuana. And Cavnue (also with a number of partners) proposed “a next-generation managed lanes network” aimed at express buses and autonomous vehicles. These finalists will each get a $50,000 stipend to flesh out what they have proposed.

Another Express Toll Lane Proposed for I-77 in Charlotte
The North Carolina DOT recently received an unsolicited proposal to finance, develop, and operate express toll lanes on I-77 South, between Charlotte and the South Carolina border. It did not release the identity of the company or team that submitted the proposal. Toll projects in the state must be requested and approved by the local transportation planning organization before NCDOT can ask for competitive proposals. Last month, the Charlotte Regional Transportation Planning Office voted to study the I-77 corridor and asked NCDOT to share whatever information it has about the proposal to assist CRTPO in its assessment.

Major Bottleneck Fix Under Way in Columbia, South Carolina
In a project estimated to take eight years and $2.08 billion, SCDOT is under way on redesigning and rebuilding “malfunction junction,” where I-26, I-126, and I-20 all come together in the Columbia metro area. It is SCDOT’s largest construction project ever. This overloaded interchange is the bane of daily commuters, vacationers, and long-distance truckers. It is ranked at #61 on the American Trucking Associations’ 2022 ranking of the country’s top 100 truck bottlenecks. Were this project to be financed up-front based on projected toll revenues (rather than being built out of annual SCDOT cash flow), it would likely be finished and in service several years sooner—and would come with guaranteed ongoing maintenance.

First Kansas Express Toll Lane Project Starts Construction This Fall
Kansas DOT and its contractors will break ground in mid-September on the state’s first express toll lanes project. It will add an ETL each way on U.S. 69 in the vicinity of Overland Park. The project is being pursued on a design-build basis. In addition to adding the express lanes, it will also add 11 noise walls along portions of the highway.

New Providers of EV Charging Emerge
Last month, General Motors and truck-stop company Pilot Co. announced plans to build a network of electric vehicle charging stations nationwide. The aim is to add 2,000 fast-charging stalls at 500 Pilot and Flying J locations, with most to be completed by 2025. They will be open to all electric vehicles, but drivers of GM vehicles will be able to make reservations and get discounts. Separately, Tesla announced that it plans to open “some” of its current Supercharger network to non-Tesla EVs.

Majority Stake in Canadian Parkway P3
A majority stake in the (non-tolled) Herb Gray Parkway in the Windsor, Canada area, is on the market. The developers/operators of this P3 expressway (ACS, Fluor, and Acciona) are selling the majority of their shares in the 30-year concession, which was financed based on availability payments from the Ontario government. The project began with a C$1.2 billion design/build/finance/maintain concession, and the Parkway opened to traffic in 2015. According to Inframation News, the buyer is Connor, Clark & Lunn Infrastructure (CCL).

NHTSA Approves Autonomous Electric Truck
Einride, a freight technology company, has received approval from the National Highway Traffic Safety Administration to operate its Autonomous Electric Transport vehicle on public roads. Einride plans to operate it for commercial customers, including GE Appliances. There will be no driver in the vehicle, but each will be monitored in real time by a remote pod operator. 

Transit Ridership Not Expected to Return to Pre-Pandemic Levels This Decade
That’s the title of a report by Phil Plotch of the Eno Center for Transportation, released on July 1. Plotch cites sobering statements from some of the country’s largest transportation agencies, including the Port Authority of New York & New Jersey, Chicago Metropolitan Agency for Planning, Los Angeles Metro, San Francisco BART, and the New York MTA. What appears to be a permanent change in working from home is a major factor in current ridership and in the restrained forecasts for the rest of this decade.

Oklahoma DOT OKs Three New Turnpike Routes
All three projects are aimed at improving connectivity with existing turnpikes. The Tri-City Connector will connect the Kilpatrick Turnpike near the airport with I-44. The planned East-West Connector will link I-44 through I-35 to connect with I-40. And the new South Extension Turnpike will link the East-West Connector to I-35.

U.K. Demonstration Project Claims Platooning Is Safe
The multi-year HelmUK trial of platooning on highways involved heavy trucks, electronically linked to take advantage of less air drag when driving closely behind one another. It was supported by the Transport Research Laboratory, National Highways, and the Department for Transport. The official finding is that platooning can be safely carried out on the U.K. road network but that improvements to fuel economy and air quality were “not as significant as predicted.”

Feds May Sell Their Share of SH 130 Concession
Back in 2016, U.S. DOT’s Build America Bureau converted its $430 TIFIA loan into an equity stake in the company (SVP) that acquired the toll highway out of bankruptcy. In late June, BAB announced that it is exploring the possible sale of its 34% equity stake. Neither the SH 130 Concession Company nor its majority owner, SVP Global, made any comments to the Inframation News reporters.

Correction re New York Ferry News Note
An alert reader spotted an error in last month’s News Note about the money-losing NYC Ferry system. The Independent Institute study noted that the per-ride subsidy on those ferries is over $9, compared with only $1 per rider subsidy for the subway. The news note garbled that, incorrectly stating that the ferry fare is only $1. Actually, the ferry fare is the same as the subway fare.

» return to top

Quotable Quotes

“It’s worth thinking a little about induced demand. Here’s what it gets right. Suppose that the Highway Fairy comes along and builds a second deck on top of I-95 from Richmond, Virginia all the way up to Portland, Maine. Traffic becomes a lot less congested, and because traffic is less congested, car trips around the Northeast go faster. Because driving is now faster, it poaches mode share away from Amtrak and airplanes on the Northeast Corridor. And ideas like ‘let’s drive from Fredericksburg up to Baltimore to see the Aquarium’ or ‘let’s drive from Providence to Portland for the long weekend,’ or ‘I can commute to Philadelphia from south of Wilmington’ start to seem more appealing. All that extra driving eventually soaks up the additional highway capacity, and the bigger I-95 ends up congested after all. I think that’s an accurate description of the situation, but it’s fundamentally odd to describe that as if the Highway Fairy didn’t accomplish anything useful here. People got to go more places and do more stuff. To the extent that there’s a genuine problem with overbuilding roads, it’s that sometimes they don’t induce much demand. That’s a ‘bridge to nowhere’ and a waste of resources.”
—Matthew Yglesias, “Answering Bill Maher’s Concerns on Traffic and One Billion Americans,” Slow Boring, Substack.com, Aug. 3, 2022

“The tragedy of transport planning in the U.S. is that there continues to be a belief that the reason there is low transit ridership is the car industry, which in a conspiracy with politicians and land speculators, has made mass transit unsuitable for moving people from where they are to where they want to go. With the exception of NYC and to a certain extent Boston and Washington, DC, American cities have been built when they were necessary, but with the objective of housing their residents in the type of dwelling they preferred, that is, a house on a piece of land that are both as large as the owner can afford. This has resulted in low densities and, therefore, lower than optimal numbers to support public transit.”
—Michael L. Sena, “Mobility Implications of America’s Anti-City Legacy,” The Dispatcher, Aug. 2022

“Buttigieg concluded that he believed tolling would be limited to specific locations and high-traffic highways and bridges, rather than an approach for how the road system at large would be funded. In response Rep. Daniel Webster (R, FL). who raised the tolling question, did not offer any evidence of the benefits from expanded toll roads in Florida’s Orlando metropolitan area in terms of delivering new infrastructure that enables economic growth and expanded access to economic opportunity. . . . There is no one silver bullet to address the systemic and structural shortfalls of federal transportation revenue. A variety of solutions is needed to contribute to a comprehensive and viable toolbox of solutions—including tolling, road-use charging, congestion pricing, and other mechanisms that allow users to pay for the facilities and services they consume. But continuing to avoid the tough decisions on how to pay for transportation infrastructure does a disservice to the American people.”
—Mark Muriello, “Missed Opportunity for Highway Revenues in House Committee Meeting,” IBTTA Tolling Points, July 21, 2022

“This [automation] doesn’t, especially in the short term, replace human drivers. It just kind of eats into the shortage. . . . So what might happen is that the very long routes—that force drivers to be away from home all the time—get taken over by something like this. Then those people can start going to more regional driving and can get home every night. So it’s not really a replacement story. It’s sort of an implementation story.”
—Richard Tame, quoted in “As Excitement of Self-Driving Trucks Grows, Fleets Will Soon Have Products to Choose From,” FleetOwner, Jan. 18, 2022

» return to top

The post Surface Transportation News: Quantifying the value of Interstates, Texas HOV lanes, and more appeared first on Reason Foundation.

Amtrak takes in extensive federal subsidies, fails to make a profit, and has a notorious history of being anything but cost-efficient. Rather than pour billions more into Amtrak, taxpayers’ money could’ve been better spent on alternatives, such as more cost-efficient intercity bus service and further improvements to existing highway infrastructure. Private bus operators have demonstrated the ability to alter their routes and schedules make bus routes a more appealing alternative to frequently delayed Amtrak lines. 

Instead of identifying cost-effective transportation solutions, the unprecedented funding boost for Amtrak in the infrastructure bill was marketed as a means to “modernize” the aging rail system. Not even Amtrak’s most used and popular Northeast Corridor, which runs through eight states with fast Acela service between Washington, DC, and New York City, among others, is self-sustaining. The Northeast Corridor alone had a $38 billion maintenance backlog as of 2017.

Amtrak says it will spend a portion of the infrastructure bill’s funding on the Northeast Corridor. Amtrak hopes to spend a lot of the remaining money trying to emulate the Northeast Corridor in other parts of the country, which should be met with apprehension.

The most recent example of Amtrak’s efforts to expand rail service is its push to restart the Gulf Coast line, a twice-a-day route between New Orleans, Louisiana, and Mobile, Alabama. The route had the highest taxpayer subsidies of any Amtrak route before service was suspended due to Hurricane Katrina in 2005.

Amtrak’s Gulf Coast line proposal would make taxpayers prop up a financially unsustainable service. Amtrak’s fiscal year 2022-to-2027 forecast for this route found it would operate at a loss of $27 million each year, or $373.4 per passenger of the 72,200 projected to ride annually by 2027.

Typically, Amtrak participates in an impact study to see how a proposed rail service would affect an area, but they’ve abandoned the study for the Gulf Coast line and are trying to move ahead. Proponents of the line hope it will have a positive economic impact, but given the projected $30.5 million annual costs to keep it operating in 2027, that seems unlikely.

But two of the states on the route offered their own money to match the $33 million in federal cash: Louisiana pitched in about $10 million and Mississippi around $15 million. The states would have to pay the full bill in five years’ time, with the federal government providing 20% less funding each year. States would be picking up the tab for a twice-a-day passenger rail line with only about 197 passengers a day.

In judging Amtrak, it is important to note that the true cost of Amtrak is often hard to calculate, thanks to the accounting tricks used to cover Amtrak’s losses. Despite being run as a “for-profit” entity in a government-ensured monopoly, Amtrak has never actually made a profit and has two methods to mask its losses from the public eye, rail critic Randal O’Toole, a former senior fellow at the Cato Institute, noted in 2019.

The railroad inflates its revenues by considering subsidies from 17 states as passenger revenues. In 2020, Amtrak’s profited 50 cents per passenger-mile in revenue, according to the Bureau of Transportation Statistics, but that is based on Amtrak’s phony accounting, which also fails to include depreciation in its expenses, despite maintenance problems needing to be addressed. Amtrak also enjoys special treatment under federal law. Freight railroads must allow Amtrak to use their tracks and give Amtrak trains priority over freight trains on the tracks. Amtrak only owns about 3% of their track, nearly all of that in the Northeast Corridor.

With the importance of freight rail for supply chains across the U.S., we must also consider economic activity potentially lost due to freight trains being delayed. The Port of Mobile has generated around $26.8 billion in economic value for the region. Jim Lyons, chief executive officer of the Alabama Port Authority, said that freight company CSX makes up about 65% of the rail activity in the Port of Mobile, and the past passenger rail caused “big headaches for freight activity in Mobile.” Lyon’s opposes the Gulf Coast line.

In the Gulf Coast line’s case, if the goal is to expand passenger rail service in the region, it would be easier if Amtrak tried to foster a cooperative relationship with freight railroads. Yet Amtrak has had a strained relationship with Norfolk Southern and CSX, the two rail companies that own the rails between New Orleans and Mobile. When the rail companies asked Amtrak to better accommodate both passenger and freight rail without as many delays, Amtrak called it a “ransom,” and their approach has been far from collaborative.

More broadly, many proponents of passenger rail in the United States want to try to copy the European approach of large passenger rail subsidies but rail is far more critical for freight movement in the U.S. than it is in Europe. In 2020, freight rail carried 27.4% of all cargo weight in the U.S., whereas in the EU, it carried 16.8%.

By operating its rail lines primarily for passengers, Europe ended up having to rely more on trucks for cargo, and trains for people. The U.S. did the opposite and relies on freight to move goods. Thus, when freight railroad tracks are forced to prioritize passenger rail, everybody loses. Crowding freight rail could also lead to greater traffic congestion on highways if freight companies have to ship even more goods via truck.

Amidst numerous supply-chain issues leading directly to American consumers paying more for everyday items, weakening a critical link in our supply chain seems ill-advised.

Instead of asking taxpayers to prop up more money-losing routes across the nation, we should look to alternatives that require no (or smaller) per-passenger subsidies and less interference with freight rail.

Intercity bus carriers, for example, require almost no subsidy compared to Amtrak’s roughly $0.36 per passenger mile. Travel times are comparable in many regions. And, in some corridors, including along the Gulf Coast, intercity bus is faster than rail.

The Gulf Coast line is a poor use of taxpayers dollars, but it’s just one example of Amtrak’s wasteful ineffectiveness. The billions in additional Amtrak spending already approved could’ve been put to better use improving existing infrastructure that more people use. Now, other states should examine the Gulf Coast line before contributing their own funds to Amtrak expansion projects that they could find themselves subsidizing for years to come.

The post Amtrak’s Gulf Coast line proposal would make taxpayers prop up a financially unsustainable service appeared first on Reason Foundation.

Ways To Change Transit Service Design for the Better

• Adjust geographic coverage by redesigning existing bus routes to serve population centers, adding service on weekend days, and reducing it during off-peak periods.
• Improve bus-run times by consolidating stops and using technology to speed up trips, such as transit signal priority.
• Take a holistic approach that integrates fixed-route services, on-demand services, private services, bike-sharing, ridesharing, and (eventually) automated vehicles.

Improving Transit Governance

• Transition most transit agencies into mobility management agencies that coordinate services across public, private, non-profit, and contracted transit entities.
• Contract with quality private and non-profit operators wherever possible, as other developed countries do.
• Eliminate laws that prevent competition and protect transit monopolies.
• Improve accountability and transparency by setting performance goals to be met by all transit providers.

Changing Transit Funding

• Eliminate federal transit subsidies for capital projects and provide subsidies for operations and maintenance in ways that reward transit agencies that provide high-quality, low-cost services.
• Provide user-side subsidies to transit-dependent customers that allow them to use the vouchers or funds on whichever transit service is best for them.
• Charge transit-choice riders—those with access to another transport mode—the full price of providing the transit services to them.  

21st Century Transit: Free Market Transit Policy

The post How to improve transit service for today’s workers and commuters appeared first on Reason Foundation.

• Urban freeway teardowns begin
• State DOTs accelerate highway capacity expansion
• Equity concerns pose problem for express toll lanes
• A physicist’s warning about hyperloop
• Federal EV charging plans fall short
• Ocean shipping problems—and non-solutions
• News Notes
• Quotable Quotes

Urban Freeway Teardowns Begin

Two important developments regarding urban expressways took place within the past month or so.

First, on May 31, New York State’s Department of Transportation (NYSDOT) announced that its plan to demolish I-81 through downtown Syracuse and replace it with a boulevard had received approval from U.S. Department of Transportation (DOT). Second, on July 1, DOT’s Federal Highway Administration (FHWA) announced the notice of funding opportunity (NOFO) for its Reconnecting Communities program, which offers both planning grants and (de)construction funds to remove or deck-over urban expressways that divided communities when they were built in the 1960s.

Tearing out urban freeways has long been a goal of the Congress for a New Urbanism (CNU), whose latest list of “freeways without futures” totals 15, including I-81 through Syracuse, I-35 through Austin, and the Brooklyn-Queens Expressway in New York City (I-278).

In my book Rethinking America’s Highways (University of Chicago Press, 2018), I examined CNU’s claimed success stories, and found that their handful of cases were mostly stubs of planned but never-built freeways (Milwaukee and San Francisco), so their claim that after removal the former freeway traffic “just melted away” is hardly applicable to an Interstate that is a key link in a metro area’s overall mobility.

In researching this article, I talked with several transportation experts involved in debates over the Syracuse I-81 project. A former DOT Secretary pointed out that never before has a key link in a major (two-digit) Interstate been proposed for deconstruction—and questioned whether this is even legal. Attorneys working with opponents shared with me letters sent to FHWA and NYSDOT arguing that the Draft Environmental Impact Statement (EIS) failed to properly consider all the impacts and had not examined alternatives to the teardown, as opposed to single-mindedly pursuing the “long-standing predetermined option” of the boulevard (termed a “community grid”).

Also of interest was a submission to FHWA dated March 10, 2022, arguing that the Final EIS and Record of Decision would violate Title VI of the 1964 Civil Rights Act. The letter argued that the replacement of the freeway by the “community grid” would inflict serious harm, in the form of traffic congestion and vehicle emissions, on Syracuse’s South Side community, home to more than 61% of the African-Americans that live in Onondaga County. It also pointed out that the plan is inconsistent with the 1999 Southside Transportation Study, which argued that, “Limiting commuter traffic traveling through the study area would assist in the preservation and enhancement of the pedestrian nature of this area.”

Fortunately, contrary to some deconstruction dreams, there are alternative ways to reconnect communities that were bisected 50 years ago by freeways. Where these corridors are still key links in the overall metro area traffic flow, they can be replaced by tunnels (as in Seattle and Boston) or by depressing the freeway lanes below grade and decking over the surface, as long ago took place for portions of I-5 in Seattle, I-10 in Phoenix, I-35 in Duluth, MN, the Woodall Rogers Freeway in downtown Dallas, and I-70 in St. Louis—and recently completed on a formerly elevated section of I-70 in Denver. Projects now planning to deck over freeways (which would be eligible for grants under the new Reconnecting Communities program) include the Kensington Expressway in Buffalo and the Rose Quarter section of I-5 in Portland.

In the April 2022 issue of this newsletter, I summarized the results of a study assessing the costs and benefits of decking over, rather than demolishing an urban freeway. Analysts Jeffrey Brinkman and Jeffrey Lin of the Federal Reserve Bank of Philadelphia drew on data and economic models to evaluate a hypothetical project to deck over a 4.5-mile stretch of I-95 in Philadelphia (where other portions of I-95 and I-676 have already been decked over). Their estimate of the cost of their proposed I-95 project was $2.25 billion. That happens to be the official NYSDOT estimate for tearing down I-81 and replacing it with the “community grid” boulevard. Putting I-81 below grade and decking it over would be a far better solution for Syracuse.

» return to top

State DOTs Accelerate Highway Capacity Expansion

Politico recently reported, somewhat critically, on congressional support for projects that will add highway capacity. “Appropriators on Wednesday appeared to advocate for widening highways where bottlenecks are constraining freight movement—a recommendation that would contradict DOT’s policy of avoiding highway expansion,” opens the article. The nerve of those appropriators!

Despite last fall’s “guidance memo” from the Federal Highway Administration suggesting that in applying for the expanded federal discretionary grant programs in the Infrastructure Investment and Jobs Act (IIJA), state transportation departments would be wise to focus on projects that better maintain existing infrastructure rather than projects that add capacity to highways. Nevertheless, state DOTs and toll agencies are moving forward with major projects to expand capacity.

In fact, there is a good case for adding highway capacity in at least three kinds of situations: adding to capacity in states with fast-growing populations (hoping to at least stay even), replacing obsolete bridges (and adding new lanes to cope with future growth or to eliminate bottlenecks where a bridge has fewer lanes than the highways on either end), and adding lanes in highway corridors where truck traffic is expected to grow by 40% or more by 2040.

Much of the capacity expansion under way or planned falls into one or more of these categories. Here are some examples.

Adding More Capacity to Keep Pace with Fast Population Growth

Texas (#1, at 15.3% population growth 2019-2020) is:

• Extending the Grand Parkway around Houston by 53 miles;
• Widening 9.3 miles of the Dallas North Tollway from three to four lanes each way and adding managed lanes to several congested freeways in Dallas;
• Widening I-35 through congested San Antonio and Austin.

Colorado (#2, with 14.5% population growth)

• Widening 13 miles of I-70 west of Denver to eliminate the notorious bottleneck at Floyd Hill;
• Continuing to add express toll lanes to congested freeways in the Denver metro area.

Florida (#3 at 14.2% population growth)

• The Central Florida Expressway Authority will invest $4 billion over the next five years to add capacity to and improve its tollway network in the Orlando metro area.
• Florida’s Turnpike is widening its southern link in Miami-Dade County from four to eight lanes each way.
• The Turnpike mainline is being widened in Palm Beach County and west of the Orlando metro area.

Arizona (#6 at 13.9% population growth)

• The state DOT has approved $6.7 billion for roadways over the next five years.
• Projects include a $990 million widening of the remaining portion of I-10 in Phoenix with only two lanes each way (a major bottleneck);
• Another project will widen a stretch of I-17 north of Phoenix.

South Carolina (#8 at 11.3% growth)

SCDOT has embarked on a program to widen much of its Interstate system, including:

• I-85 in Greenville and Spartanburg Counties ($1.26 billion);
• I-26 between Columbia and Charleston ($1.7 billion);
• And, completing the I-526 loop ($2.3 billion).

Replacing Obsolete Bridges

• Alabama DOT is gearing up for its $2.7 billion plan to upgrade its Bayway and add a new, higher bridge across the Mobile River, partially financed by tolls.
• Kentucky and Ohio are nearing agreement on a plan to replace the obsolete Brent Spence Bridge across the Ohio River, at an estimated cost of $2.8 billion.
• Kentucky and Indiana have begun construction of the $1.2 billion I-69 bridge across the Ohio River.
• Louisiana DOT is moving forward with two major bridge replacements: the $850 million I-10 Calcasieu River Bridge and the $2.5 billion I-10 Baton Rouge Bridge.
• Oregon and Washington are nearing agreement on the replacement bridge on I-5 across the Columbia River, at a cost that may reach $5 billion.

These bridges will each add lanes compared with the existing crossings, to remove a current bottleneck and account for likely traffic growth over 50+ years.

Adding Truck Lanes to Key Truck Corridors

A 2013 Reason Foundation policy study analyzed FHWA Freight Analysis Framework projections of truck traffic on major Interstate routes. It identified 11 multi-state corridors that were forecast to reach or exceed 40% of all VMT as trucks by 2040. They include east-west routes:

• I-10 from California to Mississippi
• I-30 in Arkansas and Texas
• I-40 from California to Tennessee
• I-70 from Missouri to Pennsylvania
• I-76 in Colorado
• I-80 from Nebraska to Ohio
• I-84 in Idaho.

North-south corridors needing dedicated truck lanes are:

• I-65 in Tennessee, Kentucky, and Indiana
• I-69 in Indiana
• I-71 in Kentucky
• I-81 from Tennessee to Pennsylvania

Given the explosion in truck traffic due in part to the growth of online shopping, those projections of needed truck-only lanes are likely conservative at this juncture.

The bottom line is that there is an enormous, well-justified need to expand the capacity of selected highways and bridges—not everywhere, but in high-growth states, where obsolete bridges also fail to provide enough capacity, and where truck traffic is projected to grow to unprecedented levels. State DOTs and toll agencies that are pursuing such projects should be thanked, not criticized.

» return to top

Equity Concerns Present Challenges for Express Toll Lanes
By Baruch Feigenbaum

Equity is becoming a core concern for many state transportation departments. And express toll lanes, which are perceived by some politicians as being too expensive for users, are at the tip of the spear. Many DOTs have started workgroups or contracted with consulting companies to research ways to improve express toll lane equity.

Some of the studies are politically directed. For example, in 2019, the Washington state legislature ordered the Washington State Transportation Commission to examine how a low-income toll program could operate for the express toll lanes on SR 167 and I-405 in the Seattle metro area. Together with WSP, the commission conducted a study that looked at five types of discounts: percentage discount, fixed discount, fixed toll credit, fixed number of free toll trips, and/or a lower maximum toll. The study scored the programs based on user benefit, program cost, operational benefit, and feasibility. The two that scored best were a fixed number of free trips and a fixed amount of toll credits.

Some equity projects are more of a spur-of-the-moment reaction to public concerns. Elizabeth River Tunnels, which operates the downtown and midtown tunnels in the Hampton Roads, Virginia region, was under intense pressure from then-Gov. Terry McAuliffe to offer relief from high tolls and late fees. Today, the Abertis-operated tunnels allow drivers with an EZ-Pass who make eight or more trips per year and earn less than $30,000 per year to use the tunnel for $0.75 per trip, about 1/3 the price for other EZ-pass users.

Another option is for agencies to offer a discount for the first month of service for new customers. In Los Angeles, for example, the Los Angeles County Metropolitan Transportation Authority is offering a one-time toll credit of $25 to low-income households who set up their FasTrak account. In Southern California, vehicles with three or more people already travel toll-free on the I-10 and I-110 express toll lanes. Yet, the agency is offering a toll credit to residents who make up to $27,180 for a single person to $93,260 for a household with eight members.

Other regions are proposing different programs. In 2017, Minnesota approved a program providing annual toll credits for express toll lanes, which has yet to be implemented. Toll agencies in the San Francisco Bay Area have proposed a percentage discount on every toll that low-income drivers pay. And Colorado is examining how it might implement low-income discounts on express toll lanes (ETL) on I-25 and I-70.

Providing discounts for those paying for highways is a relatively new development. No government provides discounts for fuel taxes paid, and there are not typically discounts for tolls paid on traditional turnpikes.

There has not been a major outcry from current low-income ETL customers for discount programs. An earlier University of Washington study found that the lowest-income quintile using the I-405 ETLs benefitted the most from variably-priced toll lanes. That’s because lower-income motorists use these optional lanes when the time they save is deemed to be worth more than the cost of the toll, such as when they are running late for work or when they need to pick a child up from daycare before late fees kick in.

While recent attempts to address equity are sincere, they are also inherently problematic for the management and operation of express toll lanes. The most serious problem with discounts and free trips is that they undercut the ability of variable tolls to reduce traffic congestion. Drivers that receive discounts are not likely to be as sensitive to the price in the lane as other drivers. With fewer vehicles responsive to changes in toll rates, the lanes may lose their effectiveness in providing uncongested travel options for drivers—the entire purpose of express toll lanes. And that harms regular customers as well as express bus services that use the ETLs. Artificial toll caps have created similar problems on express toll lanes on I-95 in South Florida and I-405 in Seattle. Other express toll lanes are mandated to provide free or discounted passage to electric vehicles or motorcycles, which also reduces pricing’s power. Yet, the Washington report does not acknowledge or attempt to remedy how discounted tolls limit pricing’s effectiveness.

A second problem with offering toll discounts is that it reduces the toll revenue. For public agencies, this may make the difference between being able or unable to build, maintain, and operate the toll lanes. And when money gets tight, maintenance often gets cut. For private concessionaires, these programs can make a viable project not viable, resulting in delays or cancellation of the construction of new express toll lanes.

Third, discounts disincentivize commuters from using transit. With some ETL projects, toll rates help pay for express bus service. Reducing the toll rates makes driving cheaper and makes providing transit more challenging. It incentivizes single-occupant commuting and traffic congestion, exactly opposite of what most metro areas are trying to achieve.

Highway providers should operate like utilities but they seem to be under more pressure than other utilities to offer special discounts. A better solution is to provide transportation vouchers to low-income households. If those households want to use express toll lanes, then they could use the vouchers to help cover the costs. But they should also be able to use the vouchers on other transportation options, such as buses and express buses operating in the express toll lanes. In addition to reducing costs to low-income commuters, vouchers allow tolled roads to operate more like utilities, give the commuter power over his/her commute options, and better address the transportation equity challenges.

» return to top

A Physicist’s Warning About Hyperloop

On May 26, a website called Bigthink.com published an article called “Elon Musk’s Hyperloop Is Possible. How Badly Do We Want It?” The piece raised some concerns I’d written about and others that were new to me. The author, Tom Hartsfield, was also new to me. The Bigthink website identified him as a physicist living in Los Alamos, NM. His articles on the site cover a wide array of technology topics, and the two that I read (on subjects I’ve seriously researched) looked sound. So I’m summarizing the main concerns in his article.

He first explains that hyperloop is a proposed system that would propel passenger modules through long-distance tubes evacuated of nearly all air, to permit speeds potentially in excess of 700 miles per hour due to almost no air drag. Hartsfield then turns to the physics problems. His main concerns are with the near-vacuum tube. First, as I have written previously in this newsletter, he explains the need for airlocks at hyperloop stations, to separate the near-vacuum in the tube from the atmospheric pressure in the station and its boarding platform. That’s the easy problem to solve, but never seems to get mentioned (or costed-out) in the glossy studies urging near-term construction of passenger-carrying hyperloop systems.

Maintaining the near-vacuum in those very long tubes is a bigger challenge than most hyperloop boosters have acknowledged. To ensure there are no leaks, he recommends that the hundreds or thousands of miles of tubes be constructed of steel, which is much stronger than glass, plastic, or aluminum. (Note: the difference in air pressure between an airliner in flight and the atmosphere outside is small compared with the needed atmosphere inside the passenger pods versus the near-vacuum in the tube.) But if the tube segments are welded together, then the entire (thousand-mile?) tube would expand and contract with temperature changes, and its support must allow these expansions and contractions. Alternatively, if numerous tube sections are joined together by some means other than welding, then every one of these joints is a potential source of failure.

Potential disasters are Hartsfield’s main concern. If any of the hyperloop developers have carried out what we in aircraft engineering (my first job out of MIT) called a “failure modes and effects analysis,” they’ve kept the results to themselves. Hartsfield points out that if a joint fails, air would rush into the vacuum, creating a shock wave that would travel down the tube at the speed of sound. (I cannot verify that speed, but it is plausible.) If the breach occurs behind the train of pods, he claims the shock wave wouild destroy the train and kill its passengers. 

What if, for some reason, the pod-train stops moving, somewhere in vacuum tube? With the pods’ limited on-board air supply, how would passengers escape out of the hermetically sealed tube? This safety/evacuation concern may require that the whole thousand-mile tube be able to be shut down in sections in the event of such a failure, which would bring at least some of the other pod-trains to a halt and likely require their passengers also to evacuate once their tube section was filled with air at atmospheric pressure.

Finally, Hartsfield also points to external damage to the tube. Suppose some kind of vehicle crashes into the tube, or somebody takes a shot with a 50-caliber bullet? Would the tubes be tough enough to survive without a breach that would let in an uncontrollable continuous blast of air? And to protect against this, would there have to be extensive monitoring and security, far more than is required for railroad lines? Or would all the tubes have to be underground, at considerably greater construction cost?

Some of these concerns may be exaggerated, and perhaps some hyperloop developers have proposed solutions. But nothing about safety and security has appeared in any number of supposed hyperloop feasibility studies, which often appear to be written as promotional documents to attract taxpayer funding. Until independent engineering studies—especially concerning failure modes and effects analysis—are carried out and can be peer-reviewed, I will remain skeptical that hyperloop has any real likelihood of becoming a new mode of intercity passenger travel.

» return to top

Federal Electric Vehicle Charging Plans Fall Short in Many Cases

Last month, U.S. DOT released its proposed regulations for electric vehicle charging infrastructure, governing the $5 billion (over five years) allocated in formula funds by the 2021 Infrastructure Investment and Jobs Act (IIJA). Among the requirements in the proposed regulation are the following:

• Electric vehicle (EV) charging facilities must have at least four DC fast chargers, each of which must be capable of delivering 150 kilowatts per vehicle while all are in operation.
• Charging stations must provide secure payment methods that accept major credit and debit cards.
• All traffic control devices and highway signage must comply with existing federal regulations.
• Chargers must display the price in dollars per kilowatt-hour.
• Charging ports must have annual “uptime” ratios of 97% or greater.

Those are relatively innocuous regulations, but the concerns being raised by state DOTs deal with two matters that are part of federal law. The 2021 IIJA requires states to provide EV charging stations every 50 miles along major highways. And long-standing federal law prohibits commercial services at the rest areas on Interstate highways (other than the exempted service plazas on tolled Interstates). Both policies are raising concerns at state DOTs in rural and western states.

Jennifer Hiller’s June 14 front-page Wall Street Journal article, “Plan for EV Chargers Meets Skepticism in West,” addressed both concerns. In Montana and other western states, “there are plenty of places where it’s well more than 50 miles between gas stations,” Rob Stapley of the Montana Department of Transportation told Hiller. And even where there is a potential location (e.g., an exit) there might not be any nearby source of enough electricity to supply a charging station that meets federal standards. A Utah DOT official told Hiller that sites with lighting and amenities are often located five-to-10 miles further than the 50-mile requirement.

Hiller’s article also points out that rest areas on Interstate highways do have electricity service, but even if there is enough capacity to provide four DC fast chargers, the rest areas lack food and shopping services that EV customers could use while they wait for their EV to be charged. New Mexico DOT’s Joe De La Rosa argued that the ban on commercial services leaves states with unappealing choices for EV charging: “The reason [rest areas] exist is that there’s nowhere else to stop. This is the middle of nowhere.” This makes a nonsense out of claims from the ban’s supporters that any commercial services at rest areas will take business away from gas stations and convenience stores at Interstate off-ramps. Idaho Gov. Brad Little (Republican) and Colorado Gov. Jared Polis (Democrat) sent a letter to FHWA on behalf of western governors asking for flexibility in locating EV chargers.

The role of the truck-stop and convenience store industry in lobbying to keep the commercial services ban in place continues to attract criticism. Aaron Gordon of Motherboard, on June 13, published “Big Truck-Stop Lobby a Huge Roadblock for Rural Electric-Vehicle Charging.” Like Hiller’s Wall Street Journal story, Gordon focuses on western states. As an example, he cites a 70-mile stretch of I-90 in Wyoming between Gillette and Buffalo, with a rest stop halfway between them at Arvada (population 33). If sufficient electricity could be added to the rest area, it would be the only feasible location for a charging station.

Gordon quotes convenience-store lobbyist Doug Kantor saying, “You can’t really have businesses develop at exits if you have them at rest stops.”

Needless to say, there are few convenience stores in Arvada. Truck-stop lobby group NATSO, the National Association of Truck Stop Operators, argues that if rest areas are allowed to have EV chargers, this will “discourage existing refueling stations . . . from investing in charging infrastructure.”

That is also nonsense, since a typical gas station with six or eight pumps cannot afford to give those spaces to vehicles that would occupy them for 30-to-45 minutes rather than the five minutes it takes to fill up the gas tank and use the restroom.

The federal ban on commercial services at Interstate rest areas is a significant obstacle to electric vehicle charging on Interstate highways in the western states. There are no good reasons for keeping this anachronism in the federal code.

» return to top

Ocean Shipping Problems and Non-Solutions
By Marc Scribner

When President Joe Biden signed the Ocean Shipping Reform Act into law on June 16, he promised it would “lower shipping costs.” The law increases the regulatory power of the Federal Maritime Commission and mandates new disclosure requirements, but it will not address the root supply and demand imbalances responsible for snarled supply chains and logistics congestion. While there are no quick and easy solutions to these problems, certain policies could relieve some of the pressure. Unfortunately, politicians are continuing to look in all the wrong places for ideas and risk worsening the problems they claim they are trying to address.

The COVID-19 pandemic disrupted every link of our global supply chains in numerous ways, with labor and capital shortages and misallocations hitting producers, carriers, shippers, distributors, and retailers from the raw materials to finished consumer goods. Price and time uncertainty has grown and tempers have flared. The uncomfortable truth for politicians is there are no quick and painless solutions to these myriad problems. What is needed is patience and systematic thinking to identify and jettison policy impediments to inevitable market adjustments. Unfortunately, and perhaps unsurprisingly, many politicians in both major political parties have instead opted for panic and cheap demagoguery.

These noxious politics were on display in the bipartisan Ocean Shipping Reform Act that became law in June. The original House version of the bipartisan bill (H.R. 4996) was introduced by Reps. John Garamendi (D-CA) and Dusty Johnson (R-SD). Their bill would have worsened our supply chain choke points by limiting carriers’ options to clear bottlenecks. Most bizarrely, it would have authorized price controls on detention and demurrage fees charged to customers who are late to pick up or drop off shipping containers, one of the few pro-velocity tools carriers possess. It was the maritime equivalent of removing congestion pricing because gridlock got worse.

What ultimately was signed into law by President Biden was the Senate’s version (S. 3580), which omitted or watered down the most counterproductive elements of the Garamendi and Johnson bill. But Rep. Garamendi returned with new maritime legislation introduced in late June, the American Port Access Privileges Act (H.R. 8243).

Like Rep. Garamendi’s previous efforts, this bill was seemingly written in support of California’s agricultural exporters without a lot of concern for on-the-ground transportation realities. Among other provisions, it would give preference to carriers who book at least 51% American exports as determined by weight or container volume. A shipping industry source said if adopted in practice, a vessel loaded with 51% typical U.S. agricultural containers would literally capsize due to excess weight.

Rather than proposing legislation that would sink ships in America’s harbors, Rep. Garamendi and his colleagues ought to focus on real problems and work to identify real solutions. Low-hanging fruit would include repealing the Jones Act, which requires that only American-built and -flagged vessels can move domestic goods between two U.S. ports. Its total impact on the economy may be small, but the Jones Act fails to achieve each of its claimed objectives and disproportionately harms Americans living in Alaska, Hawaii, and Puerto Rico.

Another idea would be to focus on ensuring modern technologies and practices are adopted at U.S. ports. This is much more complex and politically difficult and would require relaxing the stranglehold that the longshoremen unions have on America’s ports. On the West Coast, a labor contract dispute threatens to exacerbate congestion at the ports of Los Angeles and Long Beach, which handle nearly half of the U.S.’s containerized imports from Asia. The primary source of friction between port operators and the International Longshore and Warehouse Union is the union’s absolutist opposition to any cargo handling automation at these two adjacent ports.

Peter Tirschwell, vice president of maritime, trade and supply chain at S&P Global Market Intelligence, wrote recently in The Wall Street Journal (“More Supply-Chain Disruptions Are Coming,” June 30) that, “the West Coast ports risk becoming uncompetitive if they don’t automate. Other ports have done so and it’s one of the reasons some of the notable West Coast facilities are at the bottom of global port-productivity rankings.”

In fact, only two U.S. ports—the ports of Virginia (#27) and Miami (#39)—appeared in the top 50 most-productive global ports on the Container Port Performance Index 2021’s statistical rankings, which is jointly produced by the World Bank and S&P Global Market Intelligence. It should not be surprising that the Port of Virginia is America’s most automated port and has avoided the severe congestion problems common at more labor-intensive U.S. ports.

In an ideal world, politicians would reject their worst impulses to “do something,” accept that there are no painless short-term solutions to pandemic-induced market turmoil and work to eliminate legacy barriers to free enterprise to set the stage for more dynamic and resilient global supply chains. But in the real world, it looks increasingly likely that a global recession that tamps down goods demand and tightens labor markets may be the solution. A recession would both ease logistics congestion and distract politicians from making their counterproductive policy responses to it. They probably won’t want to claim credit, though.

» return to top

News Notes

IBTTA Response to Tolling Interoperability Article
The International Bridge, Tunnel and Turnpike Association published a critical response to Baruch Feigenbaum’s June article in this newsletter, which discussed the industry’s slow progress in implementing nationwide interoperability of electronic tolling. The commentary by Mark Muriello defended the industry’s current approach of seeking multi-protocol solutions rather than a universal transponder. The piece is posted on the IBTTA website here .

Chicago Skyway Concession May Be Sold
Bloomberg News reported on June 8 that two of the three Canadian pension funds that own the 99-year concession for the Chicago Skyway “are exploring the sale of their lease.” Both OMERS Infrastructure and Canadian Pension Plan Investment Board (CPPIB) are working with advisor Evercore on the potential sales. Together with Ontario Teachers Pension Plan (OTTP), the pension funds acquired the Skyway Concession Company from the joint venture of Cintra and Macquarie in 2015, paying $2.84 billion. Each pension fund owns one-third of the concession. The Bloomberg report cites a consultant’s estimate that the Skyway is now worth more than $4 billion.
  
Texas High-Speed Rail Company Loses Management Team
Engineering News-Record reported in its June 27/July 4 issue that the chief executive officer of Texas Central Railroad had resigned, along with the entire board of directors. Chairman emeritus Richard Lawless said he remains involved as a shareholder representative, and the company is currently being run by a senior manager from FTI Consulting, which has advised firms on bankruptcy and reorganization. Texas Central has planned to build a 236-mile high-speed rail system between Houston and Dallas. Legal challenges to right-of-way acquisition were settled last month when the state’s Supreme Court ruled that Texas Central can use eminent domain to acquire right of way. Inframation News cited cost estimates for building the high-speed line at between $18 billion and $30 billion.

Boring Company Gets Approval for Expanded Las Vegas Tesla Tunnels
The city of Las Vegas approved a 50-year non-exclusive agreement with Elon Musk’s Boring Company to build five miles of its Vegas Loop serving the downtown area with five stations. The agreement is similar to the one the company signed with Clark County last October for the other 29 miles of the 34-mile system. The company will cover the cost of building the system, while hotels and other venues will pay for stations on their properties. The completed loop will include both Allegiant Stadium and the Harry Reid Airport.

India Planning $4.5 Billion Highway P3 Leases
The National Highways Authority of India (NHAI) plans to offer 14 highway assets totaling 1,750 km on long-term P3 leases between now and March 2023, reports Inframation News (June 2, 2022). This announcement marks the continuation of India’s highway asset monetization, otherwise known as infrastructure asset recycling. Since 2018, NHAI has raised $2.2 billion from leases in its Toll-Operate-Transfer (TOT) P3 model, under which the wining bidder pays an upfront fee and takes responsibility for operating and maintaining the highway for the duration of the lease.

Google Maps Now Includes Toll Road Cost
Until recently, Google Maps implicitly treated toll roads and toll lanes as something to avoid, simply by warning drivers the “this route includes tolls,” even though such routes are generally the fastest option. But a new policy will include the real-time toll amount, enabling motorists to make an informed choice about the value of taking the faster tolled route. The June 14 Mashable article explaining the new policy shows a “Route Options” screen that Google Maps users can preset, to include “avoid tolls” or “see toll pass prices.” As of the date of the article, the feature was live for “nearly 2,000 toll roads in the U.S., India, Japan, and Indonesia,” with “more countries coming soon.”

Pennsylvania Turnpike Offers New Off-Line Cash Option
Because a fraction of its customers lack credit/debit cards, the Pennsylvania Turnpike last month announced a new option under which those customers can pay their toll bills using cash. The Turnpike is partnering with KUBRA Cash Payment Network, which operates kiosks in retail outlets such as 7-Eleven, Dollar General, CVS, and elsewhere. The Turnpike has completed its conversion to all-electronic tolling, via either E-ZPass Toll-by-Plate. The latter requires sending bills, and the KUBRA deal enables them to be paid in cash. Puerto Rico’s toll roads implemented toll transponder accounts in 2000, under which customers can replenish their accounts using cash at retail kiosks. Florida’s Sunpass system subsequently implemented a similar system.

Macquarie Rebalancing Highway Assets
Australian infrastructure investor Macquarie has announced two asset divestitures, and there is active interest in both. On June 14 it announced the sale of its majority stake in the Goethals Bridge P3 (between New Jersey and New York). Macquarie Asset Manager holds 90% of the 40-year DBFM concession. Separately, Macquarie is selling its interest in a portfolio of toll roads in India, with interest already expressed by investors Adani Transport, AP Moller, Cube, and KKR.

California Appeals Court Decries CEQA Abuse
The First District of the California Court of Appeal upheld approval of a 43-unit residential property, following what law firm Holland & Knight characterized as “years of NIMBY obstruction, government resistance, and numerous court challenges.” The court expressed dismay at the misuse of the California Environmental Quality Act (CEQA), which it said has devolved into “a formidable tool of obstruction” of needed projects.

Build America Bureau May Sell Stake in SH 130 Toll Road
In the bankruptcy of the concession company that financed and built the tolled 41 miles of SH 130 between Austin and San Antonio, Texas, the federal Transportation Infrastructure Finance and Innovation Act (TIFIA) loan program converted its project loan into a 34% equity stake in the reorganized company. U.S. DOT’s Build America Bureau (which manages the TIFIA portfolio) is exploring the sale of its stake, according to several sources contacted by Inframation News (June 24, 2022). The majority equity holder, Strategic Value Partners, does not have plans to sell its stake, according to another source.

ASU Researching More-Durable Pavements
The Southwest Pavement Technology Initiative at Arizona State University is working with industry sources to develop recipes for stronger, more cost-efficient roadways. Another aspect of the project is pavement for autonomous vehicles—such as heavy trucks and their platoons. The results might inform future projects to add dedicated truck lanes to Interstate highways.

Privatize the York City Ferry?
A provocative commentary from the Independent Institute compares the performance of private ferry services in the New York City metro area with city-owned ferries, finding the latter as having high costs and low ridership. For example, in 2019 the cost per trip on the city’s ferries was $13.83, but the fare charged was only $1.00. Read the details here.

Correction to Last Month’s Article on Truck Electrification
Several readers pointed out an error in the article “Battery-Electric or Hydrogen Fuel Cell for Heavy Trucks?” in the June issue of this newsletter. In the paragraph comparing the weight of conventional, battery-electric, and hydrogen fuel cell tractors, the correct weight of the battery-electric tractor is 32,016 pounds, compared with 21,337 pounds for the fuel cell tractor and 18,216 pounds for the internal-combustion-engine tractor. The online version of the June issue has been corrected.

» return to top

Quotable Quotes

“Not only do community groups block explicitly green developments; they have weaponized environmental regulations in their quest to do so. . . . Although well-intentioned, these rules have provided a means for disgruntled locals to pile on delays to projects they don’t like, whether or not they have a legitimate environmental complaint. As the economist Eli Dourado has noted, environmental impact statements used to be pretty short—some just 10 pages. But after years of judicial decisions expanding what is expected from an EIS, the average length of these reports is now roughly 1,600 pages, and they can take 4.5 years to complete, all without actually requiring any environmental protection at all. The primary output of the regulation is delay.”
—Jerusalem Demsas, “Community Input is Bad, Actually,” The Atlantic, April 29, 2022

“Services designed to carry white-collar workers into city centers, such as the London Underground and commuter railway lines, are quiet because more of these people now toil in spare bedrooms and garden offices. Buses are busier because they are used by students, shoppers, and manual workers who cannot avoid traveling. . . .  Like Wile E.Coyote running off a cliff, politicians tend to talk as if nothing has changed. . . . But changes in working habits are likely to endure. A survey by the Office for National Statistics in early April found that 23% of all [UK] businesses and 43% of professional-services firms expect a permanent increase in home working.”
—“The Future of Transport: The Road Not Taken,” The Economist, May 21, 2022

“Location-based payment systems are as ubiquitous as a credit card. They are inexpensive to install in terms of physical infrastructure (GPS location based) and the back-office operations (text, email, and chat supported) are extraordinarily convenient. Immediate customer notification occurs automatically, identifying customer actions needed that can then be universally performed by the customers on their smart device. These payment systems offer the opportunity to easily and quickly subscribe to a payment service that can assist both frequent and infrequent users of transportation facilities. . . . These systems are being incorporated into onboard vehicle systems. While these systems are complementary to existing RFID operations, they also offer the opportunity to expand beyond toll roads to include parking, subways, buses, ferries, and other modes of transportation, as well as commercial transactions. This payment linkage will provide direct support for the ongoing maintenance and construction of transportation infrastructure.”
—Harold Worrall, “The Future of Toll Payment,” IBTTA Tolling Points, June 15, 2021

“The major question for pavements is whether or not our infrastructure is capable of sustaining the loads from those trucks traveling in platoons. In our research sponsored by the U.S. Department of Transportation’s University Transportation Center at the University of Michigan, we have been studying deformation resistance of different structures and mixes under different loading configurations associated with truck platoons.”
—Hasan Ozer, Arizona State University, in “Building Stronger, More Cost-Efficient Roads,” Arizona State University, June 10, 2022

» return to top

The post Surface Transportation News: Urban freeway teardowns, states accelerate highway expansion, and more appeared first on Reason Foundation.