Vol. 18, No. 3; May/June 2007
In recent months, the Congressionally-chartered National Surface Transportation Policy and Revenue Commission and the House Transportation and Infrastructure Committee have called for "a new vision" for the federal surface transportation program. This has been echoed by many other voices in the transportation community. Behind these calls lies a belief that in the absence of a more clearly defined mission the federal program will lose its sense of purpose and become simply a vehicle for revenue sharing. Absent a compelling new mission, disputes between donor and donee states over funding allocation will become ever more intense, and the temptation to earmark a high proportion of the Trust Fund for projects of purely local interest will become ever harder to resist. Moreover, lacking a program that is national in scope and challenging in its objectives, it may not be possible to galvanize public support for substantially increased funding that is needed to renew and expand the nations aging highway and transit infrastructure. A parallel often is drawn between the challenge facing the nation today and the situation fifty years ago, when a bold vision of interconnecting the nation with a network of limited access highways captured the public imagination and generated sustained congressional support and funding for over half a century.
In the months ahead, we can expect attempts to develop a similarly challenging vision for the surface transportation program of the 21st century. The American Road and Transportation Builders Association (ARTBA) has led the way with its proposal for "Critical Commerce Corridors." The American Association of State Highway and Transportation Officials (AASHTO) will attempt to develop an industry-wide consensus vision at a "Transportation Vision Summit" on May 21-23. Lastly, the National Transportation Policy and Revenue Commission itself is engaged in future scenario development. Taking our cue from these three initiatives, and responding to the Transportation Policy Commission's open invitation for "Big Ideas," we have put forward some thoughts of our own in the form of a scenario of a future highway and transit program.
The long-delayed National Surface Transportation Infrastructure Financing Commission held its first meeting on April 25. Based on what we heard and observed at the meeting, we believe that the Financing Commission will turn out to be a valuable source of expert analysis and counsel on the complex issues surrounding the future of transportation financing... What struck us, was the impressive level of knowledge, expertise and sophistication displayed by the Commissioners. Given their personal involvement in a variety of transportation financing transactions, we think the Commission members can add a valuable perspective to the debate on the future of the federal surface transportation program .The House proposal to repeal the Commission (see News From the Transportation Front No. 13) seems increasingly incomprehensible and foolish. In doing away with the Commission, Congress would be depriving itself of a unique source of expertise. Fortunately, the prospect of such a repeal appears increasingly remote.
In an announcement greeted with applause by some and deep skepticism by others, Mayor Bloomberg ended a year-long speculation by announcing that he is proposing a three-year pilot experiment to introduce congestion pricing in Manhattan. The proposal must be approved by the New York State legislature before it becomes law. US DOT Secretary Mary Peters praised the plan as "the kind of bold thinking leaders across the country need to embrace if we hope to win the battle against traffic congestion."
The role of private equity markets in financing public infrastructure has become a subject of increasing speculation in the transportation community. Of the four principal sources of equity capital-insurance companies, university endowments, wealthy investors and pension funds- public pension funds are the focus of special attention because of the vast sums of money they need to invest. How these funds view investments in transportation infrastructure was the subject of an investigation by Christina Currier, a senior researcher in the Government and Business Enterprises Division of the Texas Department of Transportation. Her report, which focuses on pension funds in California, Texas and Canada, is presented in abbreviated form below. The full version can be found at http://www.dot.state.tx.us/ publications/ government.htm.
Late last year we announced our intention to open up the pages of this publication to our readers who wished to make their voice heard in the emerging debate about the future of surface transportation. While organized interests have ample opportunities to make their views known through press announcements, sponsored reports and conferences, individual members of the transportation community have no forum for expressing their ideas. By launching this new series of commentaries we intend to offer our readers an opportunity to take part in the dialogue. We hope that by making the process more inclusive, and opening up the discussion to a more diverse range of ideas, we will enrich the thinking of the two congressionally-chartered commissions as they proceed with developing recommendations to Congress for the future surface transportation program. We are inaugurating this series with a commentary by Emil Frankel, former Assistant Secretary for Policy at the U.S. Department of Transportation and former Transportation Commissioner of the Connecticut Department of Transportation. Mr. Frankel currently serves in a senior executive position with Parsons Brinckerhoff.
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