Idaho Transportation Issues David T. Hartgen, Ph.D., P.E. Emeritus Professor of Transportation Studies UNC Charlotte President, The Hartgen Group Remarks to the Governor’s Task Force on Modernizing Transportation Funding Boise, Idaho July 27, 2010

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

Economic Impacts of Highways: Two Views “User Benefits” Travel time savings Operating costs Accidents Reliability “Jobs” Direct (construction) Indirect (const support) Induced (local economy)

Findings from the Literature User Benefits Travel time 50-70% Reliability 20-40% Operating costs 5-10% Accidents 5-10% Largest for congestion relief Lowest for pavement and bridge work Jobs High-level studies Impact depends on local economy and ‘leakage’. Historical : jobs/$ m, 2/3 direct Recent: 5-20 jobs/$ m Highest: Widenings in mid-sized areas Lowest: pavement work in rural areas

Benefits from Projects (Continued) ARRA (‘Stimulus’) reports (construction only) T-PICS Tool for specific projects Be Cautious: –Resist tendency to over-state construction benefits –Many local unknowns –Focus on mobility improvements over time

Study of State Funding Options Reason Foundation Focuses on STATES, not feds. Near-term options, 1-5 years Consider growth, revenues, impacts 1-page summaries of states/state groups Oct 2010 (for 2011 Legis. Sessions)

Idaho Highway Program Trends RevenuesDisbursements

National Ratings (Reason Foundation) Funds increased Rural Int. % Poor worsened slightly. I-84 work will improve ratings

Idaho Road Condition Trends Interstate SystemLower Systems

Idaho Highway Program Trends

What are States Considering??

What ‘s Been Approved? States Doing? TOP 6: Bonds Fuel Taxes PPPs Vehicle Reg. Fees Tolls Re-Direct Funds to/from Highways No Approvals of VMT fees Congestion pricing Carbon taxes

Fuel Taxes and Registration Fees Fuel Gallon-Sales Taxes Cents Per Gallon: ID: $ 8.7 M for 1 cent/gal Easy to administer 19 states since 2008 (NV 2.05 c/g, OR 6 c/g contingent) Politically challenging Limited revenue at low rates Sales Percent ID: $ 6.2 M for 0.25 cent/$. 2 states since 2008 (IN, NE) Limited revenue at low rates Vehicle Registration Fee ID : $ 10 m $ 5/10/25 add- on) (Trucks $0.4 m) Easy to administer BUT: –Limited revenue at low rates –Visibility

VMT (Mileage) Taxes and Tolls VMT Tax ID: $ 27 M annually (1/4 cent/mi, 70%) Grows with travel, ‘odometer ‘ feasible now BUT: Replace or add to fuel tax? Administration? Privacy issues? Interstate Tolling ID: $ 42 M annually at 1 c/m cars, 4 c/m trucks. Relatively easy to administer Significant recent interest by States BUT : Restrain trade? Local travel ? Fair?

Bonds and PPPs Bonds, etc Traditional –Revenue –General Garvee bonds –Revenue stream? –Federal fund backing –Effect on Future program? BABs, PABs TIFIA –Loan guarantees/credit –Primarily large projects Private-Public-Partnerships Nationwide –Design-Build (5 recent) –Design-Build-Finance(1) –Enabling Legis ation( 6) –Tolls-pricing (2) –Maintenance (1) BUT: –Revenue or ‘shadow toll’? –Mostly > $ 100 m –Limited applicability –Advisability?

Re-Direct Funds to/from Highways 5 Recent Actions 1.AL: $ 100 m from State Trust Fund to hys. 2.CA: $ 950 m bonding from State to local roads. 3.LA: Veh Sales tax $ from GF to transp. Fund. 4.MO : Reduces veh/lic. Fee by $ 28 m. 5.ID: $ 20 m from SP/P&R to Hy Fund (delayed to 2011)

Stimulus and Federal Actions Stimulus $ 26.7 B nationwide ID $ 179 m, 16 projects ID: 2838 ‘job-years’ impact, mostly construction. Repeat ??? Federal Actions 3 FTF infusions ~ $ 35B Reauthorization ‘on hold’ pending ‘vision’, Nov. election,??, Delay to post 2012 ??? ‘Earmarks’ declining Formula changes ?? Carbon tax ?? Tolling the Interstate ??

Summary for Revenue Actions Revenue Options Continue prudent stance Slow /reduce future bonding Review fuel and registr. tax structure Study Interstate tolls Delay VMT–Pricing Other Options Consider State infrastructure bank to help locals Explore PPPs (design- build, non-revenue, etc)

“Bending the Cost Curve” Project selection Long-term “vision’ and goals /track status Select major projects by ‘benefit ’ vs. ‘cost’ Focus on early maintenance, ‘fair’ cond. Allocate funds by need. Set District goals, select projects to meet goals (Montana) Bids-Contracts Consider bid-bundling (Missouri) Consider contracting some maintenance functions. (VA, ALB) Explore PPP options. –‘Design-build’ variants –Contractor participation

Congestion and Air Quality Congestion Boise region –Congestion ‘modest’ –Plan has a modest deficit in congestion relief. –Intersection-arterial focus –$ 350-$400 M over 20 yrs Other regions –Generally ‘mild’ congestion –Intersection focus –$ m over 20 years Air Quality VOC and NOx –Sharp improvement –vehicle efficiency PM10/2.5 worsening Transp. plans have minor impact CO 2 : Likely increase –Signal timing –Tele-commuting