Thursday, September 1, 2011

The Washington Funding Mess and High-Speed Rail

Here's a follow-on article and some comments after the last blog entry about federal funding for HSR.  We know that there are hard conflicts between the two Parties over the Transportation Budget and its upcoming umpteenth extension.  

As we said in the prior blog entry, the President wants a "clean extension" of the Surface Transportation Bill that expires end of this fiscal year. (Sept. 30)  This extension is also critical for the FAA budget since it involves all our commerical aviation and its management and regulation.  Pretty important.

The surface transportation budget, to put it as simply as possible, has relied on gasoline taxes and the Highway trust fund which is "fed" by those gas taxes.  We drive more, we pay more, and there's more money to fix the highways and upgrade the trains.  As you can see immediately, that's a problem.  The fact is, we've been driving less, and using more fuel efficient cars. So, fewer highway trust fund revenues.  Furthermore we have been spending more than the gas taxes have provided. And that's another problem.

The Republicans want a six year Transportation Budget based entirely on those gas taxes, with no additional funding based on un-identified sources.  However a much richer transportation budget, well beyond the gas tax revenues is what President Obama and Senator Boxer want.  And futhermore, they want only a two year re-authorization, not a six year one like the Republicans.  

And finally, to complete this jig-saw puzzle, the Republicans don't want a high-speed rail program that's totally government paid for; they want private investors to take over the NorthEast Corridor Amtrak/Acela and operate it.  And, they don't want further HSR funding anywhere else in the US.

What we're talking about here with HSR is President Obama's vision of the future and his "legacy" or "vanity" program.  So, the lines are clearly drawn.

To answer the question in the headline of the article below, yes, it does.  And that's because of the greatest Party polarity we've seen in a generation or more. All decisions are replete with strings attached.  Pre-election jockeying is just starting.  It will get much worse before the 2012 elections are over.

So, here's the kicker in all this. Here's what Obama said in his transportation speech today: “We need to stop funding projects based on whose districts they’re in, and start funding them based on how much good they’re going to be doing for the American people. No more bridges to nowhere, no more projects that are simply funded because of somebody pulling strings.

Excuse me, Mr. President, but isn't that exactly what the California High-Speed Rail project is, a train to nowhere being built because you and Secretary Ray LaHood are pulling political strings?  Isn't that why you awarded Jim Costa's District (Fresno) over $700 million for HSR just prior to his re-election, since Democrat Costa has been such an aggressive HSR supporter? 

The fact is, Mr. President, that the California HSR project will not be doing any "good" for the American people.  To the contrary, it will be enormously harmful, and, we cannot afford it.

We agree that funding decisions ought to be rational, based on solid engineering and social needs legitimately analyzed, not politics.  When are we going to start doing that?

Posted at 02:45 PM ET, 08/31/2011

Transportation spending is a mess. Does it have to be?
By Brad Plumer

The big takeaway from President Obama’s speech on transportation this morning is that he’s urging Congress to pass a “clean extension” of the surface transportation bill that’s set to expire Sept. 30. If Congress dithers for even 10 days — and, to be fair, both parties have said they’d consider a short-term extension while haggling over a longer reauthorization bill — then the country would lose $1 billion in spending on highways, bridges and transit. Tick, tick, tick.

What got less attention, though, was Obama’s call to revamp how highway spending actually gets doled out. “We need to stop funding projects based on whose districts they’re in,” Obama said, “and start funding them based on how much good they’re going to be doing for the American people. No more bridges to nowhere, no more projects that are simply funded because of somebody pulling strings.” Seems reasonable. But how might this actually work in practice?

Back in 2009, when Congress was cramming all sorts of highway infrastructure projects into the stimulus bill, transportation expert Robert Puentes wrote a piece for The New Republic on the need to overhaul highway funding formulas. The natural first step, of course, would be to phase out earmarks, which keep bogging down highway bills. The 1981 transportation bill contained just 10 earmarks; the 2005 version contained a proud 6,371 projects directed by individual members of Congress. The earmark parade can make it hard to set national priorities. (One reason Amtrak loses so much money is that Congress keeps forcing it to do things like haul fruits and vegetables over long distances. Well, that and run a variety of geographically dispersed, low-speed intercity routes thatdon’t always make economic sense.)

But earmarks are an easy scapegoat. More important is how money gets distributed among the states. Right now, each state receives federal funds roughly equal to the amount of money it collects from the gas tax. A lot of this is done through the Equity Bonus program, which ensures that states get back at least 92 percent of what they pay — but which also, as transportation advocates argue, creates incentives for states to encourage fuel consumption. After all, more fuel guzzling equals more taxes equals more federal money. A better strategy, Puentes suggests, would be to tie spending allocations to factors like economic benefits or energy use.

Another point that the folks at Brookings have long pointed out is that it’s odd that transportation money gets lavished as widely as possible across the country. Right now, the 100 largest U.S. metropolitan areas contain about 65 percent of the population, produce 75 percent of the nation’s GDP, and account for 78 percent of interstate miles traveled, 93 percent of rail passengers and 92 percent of air and transit miles. If, as Obama said this morning, we want “to make sure that we’re getting better results for the money that we spend,” it might make more sense to focus more closely on these metro areas.

Other ideas for improving spending include coordinating highway, transit and railroad administrations so that they actually link up in a rational fashion — right now, the United States is the only industrialized country that doesn’t do this. A 2005 GAO report, for instance, found that paying closer attention to linking up airports to other forms of transportation could go a long ways in reducing congestion. And, of course, the government could pay much, much closer attention to cost-benefit analyses, especially since states rarely conduct regular evaluations of their projects. Note that the federal information system only tracks costs, not performance.

Fortunately, there’s no shortage of think tanks dreaming up ways to improve the way funding gets doled out. In June, the Bipartisan Policy Center released a proposal to consolidate the 108 federal transportation programs into 10 and to focus more clearly on five goals: economic growth, connectivity, metro access, energy security and safety. The logic here is fairly straightforward: If Congress is going to have fewer transportation dollars to play with in the years ahead — and unless politicians want to hike the gas tax,that looks inevitable — then it’s a good idea to make sure those dollars aren’t wasted. And there’s a lot of room for improvement there.

No comments: