The Road to Reform

This article first appeared in the Raleigh News & Observer.

South Carolina ranks second nationally in overall highway department performance, according to a study by UNC-Charlotte transportation expert David Hartgen. Although the comparison isn’t exactly apples-to-apples, North Carolina ranks 31st. Maybe that’s why Gov. Mike Easley’s 21st Century Transportation Committee has been mulling over ideas for road reform in North Carolina. In the interest of mulling, I’d like to add my 10 favorite ideas to the suggestion box:

10-SCRAP THE EQUITY DISTRIBUTION FORMULA. This formula allocates Department of Transportation funds statewide based on factors such as population, regional "equity" and miles-to-complete our statewide system. In practice it amounts to underfunding congested urban centers, excessive funding (and construction) for areas losing population and maintenance neglect statewide.

9-DISTRIBUTE FUNDS BASED ON PROJECTED VEHICLE-MILES. Instead of the Equity Formula, the DOT could use a plan that tracks where vehicles will likely travel. This way, people get more of what they pay for in roads, and funds actually meet our needs. The "build-it-and-they-will-come" approach — i.e., four-laning the flatlands to "spur economic development" — has had its chance. Now we have a lot of roads we can neither afford to maintain nor fill with commuters.

8-RAISE REVENUES CLOSER TO THE POINT-OF-NEED. The closer you can get to charging people for what they actually use, the less wasteful and costly your transportation system will be. Some have suggested we move to a model in which technology tracks a vehicle’s road usage. Notwithstanding Big Brother concerns, we would ultimately benefit from pay-per-use, since the current system builds in unfair subsidies that distort costs and generate waste.

7-REPLACE TAXES, BUT DON’T ADD THEM. With any new revenue system, we should make efforts to replace inefficient taxes and fees, not simply add to outdated collection schemes. We don’t need more taxes, we need more efficiency. And while you might want to replace the motor fuels tax last, remember we may not always be able to count on revenue siphoned off gasoline pumps. Cars may be powered by hydrogen in 15 years.

6-REINVEST NON-COST-EFFECTIVE PROJECTS INTO ROAD MAINTENANCE. Professor Hartgen found that eliminating the 50 least cost-effective transportation projects built between 1990 and 2003 would have saved about $2.5 billion. He also argues that proposed projects costing more than 5.3 cents-per-vehicle-mile traveled (twice the state average) should be abandoned by law. These funds could be diverted to, say, bridge and road maintenance.

5-SUSPEND WASTEFUL INVESTMENT IN LIGHT RAIL. Rail enthusiasts are fond of the refrain: "You can’t pave your way out of congestion." While such bromides may or may not be true, you certainly can’t lay tracks away from traffic. Consider this from economist Randall O’Toole: "The average urban freeway lane costs about $10 million per mile. The average light-rail line costs about $50 million per mile and carries only a fifth as many people." Ouch. No city in North Carolina qualifies for federal transit subsidy either, so all future projects will have to be funded by state and local governments alone.

4-CONVERT HOV LANES TO HIGH-OCCUPANCY TOLL LANES. Tired of sitting in traffic next to empty HOV lanes? Conversion to HOT lanes would allow you to pay to slide over. But if you didn’t, those traveling the HOT lane still lighten traffic for everyone in the "free" lanes. Since revenues are collected closer to the action, construction costs are partially offset by people willing to pay a premium for convenience.

3-EMBRACE PUBLIC-PRIVATE PARTNERSHIPS. If we decide HOT lanes and other tollways are the way forward, why not enjoy more savings by letting private concerns pay the capital costs? Of course they will profit in the long run, but we enjoy fairer, cheaper and more efficient roadways. PPPs are happening all over the U.S. One caveat: watch out for dodgy deals that benefit politicians over the public. Built-in corruption checks should accompany PPPs.

2-DEVOLVE PLANNING AND TAXING AUTHORITY TO COUNTIES. That is, end state maintenance of county roads, at the very least. Efficiency gains realized by management closer to home would benefit us in dollar terms and administrative efficiency. Our Soviet-style system is wasteful and makes life difficult for municipal planners with more intimate knowledge of local infrastructure needs than DOT central planners. Making counties responsible also makes them more accountable.

1-DISSOLVE THE STATE BOARD OF TRANSPORTATION. The board has a checkered past. It’s becoming clearer that we can no longer trust the better angels of board members’ natures when they control discretionary funds in the millions of dollars. Perhaps it’s time we had a single, accountable transportation czar.