The SourceCivil Engineering MagazineYearlong extension of surface transportation program prompts funding concerns
Policy Briefing

Yearlong extension of surface transportation program prompts funding concerns

By Jay Landers

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The recent decision by Congress and the White House to extend the federal surface transportation program for an entire year has helped reduce the uncertainty associated with many previous shorter-term extensions. However, infrastructure advocates remain concerned that federal funding for highways and mass transit could remain flat in fiscal year 2021 and potentially beyond. Highlighting such concerns, ASCE released in late September the preliminary results of an ongoing study analyzing the economic costs to the United States that are expected to result from inadequate funding of surface transportation in the future.

Faced with the looming end of the fiscal year and an unwillingness to shut down the federal government a month before the November elections, Congress hurriedly passed in late September a continuing resolution that funds federal agencies and programs through Dec. 11. Signed into law by President Donald Trump on Oct. 1, the Continuing Appropriations Act, 2021 and Other Extensions Act (H.R. 8337) also extended the federal surface transportation program through Sept. 30, 2021. Authorization for the program had been slated to expire at midnight on Sept. 30 of this year.

In July, the House passed the Moving Forward Act (H.R. 2), a broad-based infrastructure bill that included a five-year, $494 billion reauthorization of the surface transportation program. In the Senate, the Committee on Environment and Public Works approved the America’s Transportation Infrastructure Act (S. 2302) in July 2019. The bill, which would authorize $287 billion for highways and bridges for five years, has yet to be taken up by the full Senate.

The recent decision by Congress and the White House to extend the federal surface transportation program for an entire year has helped reduce the uncertainty associated with many previous shorter-term extensions.

Under the continuing resolution, federal highway and transit programs are authorized to receive respectively $47.1 billion and $12.3 billion in FY 2021, the same funding levels from FY 2020. The continuing resolution also included a transfer payment of $13.6 billion from the general fund to the Highway Trust Fund to ensure that the beleaguered trust fund remains solvent through the rest of the fiscal year. 

“While we had hoped to reach an agreement between the House and the Senate this year on a modern, multiyear surface transportation bill that moves our country forward, the single most important factor right now is providing certainty to states and local governments that are under the strain of both the pandemic and the resulting economic downturn,” said Rep. Peter DeFazio, D-Ore., the chair of the House Committee on Transportation and Infrastructure, in a news release issued on Sept. 21 following House passage of the continuing resolution. “With this one-year extension in place, we can continue work on a long-term, transformational bill that significantly boosts investment in our surface transportation network and moves our transportation systems into the 21st century.” 

The urgent need for long-term, robustly funded surface transportation legislation was underscored by Kancheepuram N. Gunalan, Ph.D., P.E., D.GE, F.ASCE, the outgoing president of ASCE, during a Sept. 23 conference call with the media, at which the Society released the preliminary findings from a pending report analyzing the deleterious effects of insufficient highway and transit funding. The full report, titled Failure to Act: Current Investment Trends in Our Surface Transportation Infrastructure, is scheduled to be released in December or January.

“While ASCE appreciates the one-year extension, the (continuing resolution) contains only the flat funding for our surface transportation systems,” Gunalan said. “As our new report shows, serious economic consequences will be inflicted without a combination of changes in our investments.”

Chronic underfunding of the nation’s mass transit systems, highways, and bridges has deteriorated their condition and capacity, said Steven Landau, during the Sept. 23 conference call. Landau is an executive vice pres­ident at the economic analysis and research firm EBP US and the lead author of the upcoming Failure to Act report. Absent major increases in funding, surface transportation infrastructure will continue to degrade, Landau maintained, exacerbating existing economic problems. “In short, we find that deficiencies in our transportation network act as a drag on the national economy and will depress incomes from American households,” he said.

Nationally, the backlog in transit investment amounts to an estimated $176 billion, Landau said. “This amount is expected to grow to nearly $500 billion through 2039 if transit capital investment is maintained at the current level of real funding and as existing assets age,” he noted. 

If such a funding scenario comes to pass, “the transit sector will face two major consequences,” Landau said. “The first is that growth in passenger delays will result from increasing service interruptions such as mechanical failures and fixed-guideway breakdowns,” he said. “The second is a significant increase in vehicle maintenance and procurement costs as service vehicles become more expensive to maintain and larger fleets are required to compensate for unreliable or faulty vehicles.”

As for roadways, “we estimate that the funding gap required to rehabilitate pavement or to make other operational improvements is about $12 billion annually, or nearly $238 billion over 20 years,” Landau said. “Put another way, spending on highways must increase 29 percent over current spending levels to address the current backlog and anticipated future needs.” However, this level of increased spending would do nothing to address the growing problem of highway congestion. 

Nationally, the backlog in transit investment amounts to an estimated $176 billion, Landau said.

“In total, about $4.1 trillion will be needed from 2020 through 2039 to sustain the multiple components of surface transportation across the U.S.,” according to the preliminary results that ASCE released in September from the report. “During this time frame, spending of slightly more than $2 trillion is projected,” leaving an overall investment gap of almost $2.1 trillion, the report concludes.

If left unchecked, the funding gap for transit and roads will have “serious economic consequences” that “will compound greatly over time,” Landau said. “Losses to households and industries will amount to $677 billion over the years 2020 to 2029.” From 2030 to 2039, such losses will total $1.3 trillion.

“Inefficiencies in the surface transportation network” will lead to job losses too, Landau said. “Collectively, the professional services, manufacturing, and health care sectors are expected to lose more than 540,000 jobs by the year 2039.” 

“The cost of continuing to inadequately support America’s surface transportation system will, at current levels, take the form of higher costs of doing business and provide less disposable income for households,” Landau said. “The burden also compromises America’s competitive position in the world economy and leads to lower overall profitability for most business sectors.”

Faced with aging infrastructure, a growing population, and increases in construction costs, vehicle fuel efficiency, and inflation, the Nevada Department of Transportation is “finding it challenging to meet the growing needs of our state and adequately maintain our roads and highways,” said Kristina Swallow, P.E., ENV SP, Pres.18.ASCE, the NDOT director, during the Sept. 23 conference call. “As a result, we are seeing more of our roads fall into worse condition.” 

Although NDOT recently boosted funding for roadway preservation efforts, the increased spending will do little to address demands associated with new construction, Swallow noted. “Even in a state with some of the best roads in the nation, our ability to  keep up with the demands of preservation and new construction will increasingly be a challenge unless action is taken now to increase revenue,” she said. In particular, Swallow called on Congress to raise the federal gas tax for the first time since 1993. 

Along with securing additional long-term funding for transit, Congress also needs to provide an immediate cash infusion for the sector, which has been battered by the COVID-19 pandemic, said Ward McCarragher, the vice president for government affairs at the American Public Transportation Association, as part of the conference call. “We urge Congress to provide $32 billion of emergency transit funding,” McCarragher said.

This article first appeared in the November 2020 issue of Civil Engineering.

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