Out of Control

Reason Foundation’s Shirley Ybarra, Virginia’s former secretary of transportation, looks at how Virginia and Florida are saving millions with fixed-price maintenance contracts.

Reason’s Transportation Research

This week, the Florida DOT issued an RFQ for a potential 50-75 year concession of Alligator Alley, the 78-mile, tolled stretch of I-75 connecting the Fort Lauderdale/Miami area with Naples/Fort Myers. According to The News-Press:

FDOT is requesting sealed Statements of Qualification from proposers desiring to receive the right to lease, maintain, operate and receive toll revenues from the project known as Alligator Alley through a public-private partnership concession agreement.

The primary objective of this concession is to maximize the value of Alligator Alley to Florida for reinvestment in transportation while maintaining the project’s high safety standards, service levels and overall quality.

. . . .

FDOT is seeking a private partner that is experienced in operating and maintaining large toll roads under a concession approach and that is willing to share risks.

The successful proposer must have proven ability to arrange and close financing on favorable terms as well as demonstrated skill in managing and operating toll roads on behalf of public sector owners.

The concessionaire will be required to fund an upfront payment of rent and periodically share toll revenues with FDOT in accordance with the requirements of the public-private partnership statute, and be obligated to operate and maintain the project during the concession period.

More details are available at the project's website, www.alligator-alley.com/.

Good news from San Diego. Only a half a year after opening, the privately-financed South Bay Expressway is meeting its traffic projections and delivering measurable congestion relief. According to the San Diego Union-Tribune:

Nearly six months after its debut, San Diego County's first tollway is living up to its promise of giving harried commuters badly needed breathing room.

The privately run South Bay Expressway draws an average of 30,000 drivers each weekday, about what state transportation officials expected.

Ben Monzon of Chula Vista said the road has cut about 20 minutes off his morning drive to his Rancho Bernardo office. “And to me, time is everything,” he said.

. . . .

According to the Macquarie Infrastructure Group, the parent company of South Bay Expressway, the tollway generated an average of $54,600 in daily revenue from mid-January through March, or about $2 per vehicle. The road attracts an average of 26,500 vehicles daily, including weekends. Nearly four out of five motorists pay through FasTrak.

Greg Hulsizer, chief executive officer of South Bay Expressway, said most of the revenue goes back into tollway operations, including covering CHP patrol costs. “It's been a very good start-up,” Hulsizer said. “It's performing pretty much like we thought it would.”

What's particularly striking in the article are the early results on the congestion front:

Transportation experts say the tollway is having a noticeable ripple effect on other major roads.

According to Caltrans, the volume of morning traffic on northbound Interstate 805 in Chula Vista has dropped 11 percent in the past six months. Driving speeds average 65 mph, up from 45 mph.

“Obviously the effect on I-805 through the Chula Vista area has been very good, and that's where we expected the major benefit to be,” said Joe Hull, a Caltrans deputy district director.

He said congestion has increased, however, at two interchanges north of the tollway: at state Route 125 and state Route 94, and at Route 125 and Interstate 8 in La Mesa.

Hull said the agency may adjust the timing of the ramp meters at both interchanges to improve the flow of cars.

Frank Rivera, a civil engineer with the city of Chula Vista, said he has noticed a decline in crosstown commuter traffic since the opening of the tollway.

“The traffic doesn't back up as much as it used to,” Rivera said.

The city is conducting a detailed traffic study to assess the tollway's impact on East H Street and other major roads. The results are due in a few weeks.

I look forward to seeing the results of that study. The South Bay Expressway is one of those premier projects that demonstrates so many important things in one package: (1) you can indeed build new capacity and reduce congestion; (2) you can accellerate road development and stretch limited tax dollars through private financing and public-private partnerships (PPPs); (3) you can successfully build environmental protection and mitigation into PPP projects; and (4) highways run like businesses will focus on delivering value to customers--in this case, time savings and a state-of-the-art road. And even in an economic downturn with high gas prices, the success of the South Bay Expressway demonstrates that there's still a significant percentage of people out there willing to pay a premium for improved mobility.

For more on the South Bay Expressway, see Reason's recent interview with Greg Hulsizer, the Expressway's CEO, here. We also discuss ithe project in the recent Reason/Show-Me Institute transportation paper here (page 26).

Arizona transportation researcher John Semmons has an excellent oped on the inefficiency of light rail transit worth reading. The oped was published in the Oregon Statesman Journal and distributed by the Independent Institute in Oakland.

Critics of LRT point out that it is not theoretical capacity that is crucial, but actual ridership and the cost incurred to garner this ridership. National figures indicate that on average, LRT carries about 5,000 people per track-mile per day, while urban freeways carry over 20,000 per lane-mile per day. So, in actual numbers of people served, freeways seem to handle over four times as much traffic as LRT does.

Also, Semmens points to an excellent 2006 study by the Arizona Transportation Research Center that analyzed freeway, light rail and alternative transportation projects based on cost effectiveness: Multimodal Optimizaiton of Freeway Corridors.

Wanted to alert readers to my latest Bacon's Rebellion column on the new sales tax proposals rumored to be floating about in Richmond these days as "solutions" to closing the transportation budget gap:

"Virginians, hold on to your wallets. Gov. Timothy M. Kaine and the General Assembly are looking for ways to close the large and growing transportation funding gap, and the only ideas we’re hearing in Richmond these days involve variations on the tax-hike theme. Before considering a variety of sales tax increases of 20 percent and higher, there should be a fundamental rethink of current transportation policy and planning to ensure that we’re taking advantage of every opportunity for more efficient infrastructure delivery.

Where do we start?"

You'll have to read the whole thing for the long answer, but the short answer is performance-based planning to prioritize congestion relief, more contracting for highway and bridge maintenance, and a far more aggressive pursuit of PPPs for new capacity.

See Reason's other transportation work here.

A study performed last fall by the Central Texas Regional Mobility Authority found that the new tollroad 183A has cut trip times down from 36 minutes to 19 minutes and reduced traffic on the parallel US 183 by 27-29%. Eighty five percent of tolls are collected electronically by tag, and some zip codes have 90+% market penetration. The press release can by found here.

LA and the federal government have signed an agreement for LA to get $213.6 million in federal funds to convert some HOV lanes around the metro area to toll express lanes. It is a big and very exciting project to convert HOV lanes that do little good into a set of lanes that could really give people and option to the stop and go congested trip when they need it.

These lanes could be the foundation for conversions throughout the network. A region wide network of such toll lanes could a) allow transit buses to get out of congestion and provide better service, b) allow people to go around congestion when they need to and are willing to pay a toll. The experience with the Riverside to Orange County 91 Express toll lanes shows that people from all income levels are sometimes willing to pay the toll to avoid congestion. Public support for those lanes is very high.

Peter Samuel dissects all the details of LA's plan here.

Check out my recent interview with Commissioner Matthew Rose of BNSF Railroads at www.reason.org. Rose is a Commissioner for the National Surface Transportation Policy and Revenue Commission that is "working to examine not only the condition and future needs of the nation's surface transportation system, but also short and long-term alternatives to replace or supplement the fuel tax as the principal revenue source to support the Highway Trust Fund over the next 30 years." Mr. Rose chats with me about his aspirations for transportation public policy here.

Governor Rendell's office released the terms of a Pennsylvania Turnpike concession yesterday. Highlights include:

• a 75-year concession term;
• a single upfront payment from the winning bidder;
• no non-compete clause, nor any provision for the concessionaire to seek compensation for reduced toll revenues resulting from the currently-unplanned construction or upgrade of nearby competing transportation facilities;
• concessionaire would be allowed to increase toll rates by 25% initially and thereafter by an annual inflation adjustment (either 2.5% or the rise in Consumer Price Index, whichever is greater);
• concessionaire will be held to some 500 pages of operating and safety specifications; and
• no restrictions on foreign bidders.

For more details, see Peter Samuel's excellent overview at TollRoadsNews.com, as well as the Philadelphia Inquirer's article yesterday.

And be sure to check out this blog post on Reason's recent policy brief (finding that the Turnpike is one of the least cost-efficient toll roads in the country), as well as Bob Poole's astute response to criticism of the report by the PA Turnpike Commission.

Lastly, over the last few months, the Inquirer ran two op-eds co-authored by yours truly and Commonwealth Foundation President Matt Brouillette on the subject of a Turnpike concession--see here and here.

We're now living with higher (real) gasoline prices than at any time in living memory. The media love to provide anecdotes about how specific people are coping, with the implication that surely these sky-high prices will reduce Americans' "love affair with their cars." Don't be too sure. For one thing, Europeans have been living with much higher gas prices (due to much higher taxes) than ours for decades, yet as those countries have become more affluent, their use of automobiles has become more and more like ours.

But more seriously, what do we know about the relationship between higher gas prices and Americans' driving behavior? And also about their choice of vehicle? The Congressional Budget Office released a pretty good study (.pdf) on these questions in January. Their findings are worth pondering.

The study used data from 2003 to 2006, during which time real U.S. gasoline prices doubled. And because Caltrans has detailed data on trips and speeds on Southern California freeways, CBO used their data to measure changes in driving behavior. What they found was a surprisingly small impact on that behavior. Over the period in which gas prices doubled, motorists on some freeways made slightly fewer trips and drove slightly less fast (at times when the freeway was uncongested). Specifically, on those freeways where there was a parallel commuter rail line (as is the case with several in the database), for every 50-cent increase in the price of gas, the number of freeway trips decreased by 0.7%. No such decrease was seen on the rest of the freeways. And for every 50-cent increase, the median speed on uncongested freeways dropped by 0.75 mph. This latter result is pr edictably small, since there is little change in gallons used per mile within the speed range of 30 mph to 60 mph, and the value of fuel savings is very small compared with the value of most people's time.

How generalizable are these results? First, most freeways in most metro areas don't have parallel rail lines, so the likely trip-reduction effect (based on these findings) is zero. And the speed reduction of less than 1 mph applies only on uncongested freeways, a declining portion of the total freeway system most places. So it's pretty unlikely that gasoline price increases in the range we've seen recently will have much impact on driving behavior.

However, the second part of the CBO research looks at what is likely to be a longer-term impact: choice of vehicle. And even though we have only three years of data, there are signs that price changes of the magnitude we've seen are affecting what people buy. First, the market share of cars relative to light trucks (pickups, SUVs, and minivans)-which had been declining steadily since the early 1980s-turned upward in 2005 and has remained above its 2004 low-point since then. The biggest single change is from vans and minivans to large passenger cars. Second, overall new-vehicle fuel economy is finally starting to rise again, after having been in a shallow decline since 1987. Third, the prices of used cars reflect the increased importance of fuel economy, with large SUVs and luxury cars declining in price, while full-size and mid-size cars show slight increases - presumably reflecting changes in demand.

These results reinforce the idea that automobility is highly valued in America, and hence that people will adjust to higher fuel costs primarily by seeking out more fuel-efficient vehicles rather than curtailing their driving.

Reason's Transportation Research and Commentary

I was flabbergasted by John McCain’s proposal to suspend collection of the federal gas tax for this summer. Suspending this user tax would deprive the Highway Trust Fund of $8-10 billion in much-needed revenue to patch potholes, rebuild failing bridges, and keep the Interstates and other key arteries from further declines in their already pathetic levels of performance. And this comes at a time when the Trust Fund is already facing a 2009 shortfall of $2-3 billion (thanks to Congress legislating more highway spending than existing gas-tax revenues can support). Plus, since the gas tax is only about 5% of the cost of a gallon of gas, the savings to motorists would be trivial.

McCain’s advisors have rushed forward with damage control, promising a legislative proposal that would hold the Trust Fund harmless by replacing the lost gas-tax revenue with general fund money, thereby adding another $8-10 billion to this year’s ballooning deficit. That would at least make the proposal less irresponsible from a transportation policy standpoint.

If politicians want to offer goodies of this kind, they should make everybody pay for them, rather than short-changing highway users.

But this episode illustrates once again why motorists are losing trust in the Highway Trust Fund. Every time Congress acts on this subject, they further politicize transportation funding, turning what was once a nearly pure user fee (to build the Interstate system) into a New Deal-style public works boondoggle. The longer-term solution is to scrap the 20th-century tax-and-grant system in favor of universal tolling, managed by each state’s Department of Transportation and private toll companies.

Reason's Transportation Research and Commentary

The Pennsylvania Turnpike Commission tried to distract people from the findings our recent study that demonstrated that the Turnpike is one of the least efficient toll roads in the country by claiming the big credit rating agencies disagree with us. Whoops. As the Pittsburgh Post-Gazette reports, “ One of the nation's ‘big three’ credit rating agencies has raised a caution flag about the Pennsylvania Turnpike's financial future because of the transportation funding bill that the state Legislature passed last summer. New York-based Fitch Ratings Ltd. announced it has downgraded the turnpike's $2.1 billion in outstanding revenue bonds by one step, from AA- to A+, thereby crossing the line from ‘high grade, high quality’ to ‘upper median grade.’ The move means the turnpike will likely have to pay a higher interest rate on future borrowing for such capital improvements as the new bridge over the Allegheny River and widening the east-west mainline to six lanes between Irwin and New Stanton.”

The Fitch downgrade notes the “mission change of the PTC from a self-supporting entity into one subsidizing state-wide functions,” giving it less financial flexibility. It also notes “the potential that capital projects can be deferred to meet Act 44 obligations, resulting in delayed and more expensive capital projects.” It also says that “Fitch believes that there are reasonable scenarios under which planned toll increases may be insufficient to meet the annual obligations under Act 44,” reinforcing the Reason report’s suggestion that toll rate increases may actually be higher under the status quo (where toll rates are not capped) than under a lease of the Turnpike (where rate increases will be capped).

A recent poll commissioned by the Bay Area Council found that citizens are keenly aware of the critical infrastructure needs facing the Bay Area and that they're very open to the idea of private sector infrastructure financing to help solve the problem. According to the San Francisco Chronicle:

Potholes, traffic jams, eroding levees and overcrowded schools have apparently convinced Bay Area residents it's time for major infrastructure improvements, according to a regional poll released Thursday.

The poll, by the Bay Area Council, found that 87 percent of residents surveyed thought that Bay Area governments had a serious problem maintaining schools, bridges, roads, parks, levees and hospitals and building new infrastructure.

Perhaps even more striking is the finding that a strong majority support the increased use of public-private partnerships (PPPs) to improve infrastructure:

While the poll did not ask voters whether they would be willing to raise taxes to pay for infrastructure improvements, it did ask if they would support public-private partnerships to help pay for specific types of improvements.

The partnerships, used in other states and countries, would allow such things as a private developer building a school and leasing it back to the school district, or building and operating a toll road or bridge in exchange for a portion of the revenues.

A strong majority of those surveyed said they would favor such an arrangement to fund infrastructure projects in the Bay Area, and the support varied only slightly by type of project. Hospitals and recreational facilities won the strongest backing for use of private-public partnerships with 71 percent each, followed by public transit at 70 percent, schools at 68 percent, and roads and highways at 65 percent.

One take-away from this is that Bay Area residents clearly see a problem and are open to new and innovative approaches to addressing it. Another is that even in an area regarded as a bastion of progressive thought, citizens are quite open to proven private-sector infrastructure delivery solutions.

At the political level, we know that PPPs are not a partisan issue, as evidenced by the fact that officials of all stripes are embracing them (including prominent Democrats like Chicago Mayor Richard Daley, Pennsylvania Governor Ed Rendell, and Virginia Governor Tim Kaine). But it's great to see that the message is getting out to the electorate as well, with pragmatism and problem-solving clearly trumping ideology in the minds of Bay Area residents.

If the political leaders in Sacramento would hurry to catch up, then we'd really have something, as my colleague Adam Summers wrote earlier this year in the Orange County Register. And to be fair, the Legislature has started to take some steps in that direction and has a number of different PPP bills in the pipeline this session. And Governor Schwarzenegger has been quite active, criss-crossing the state touting the virtues of PPPs as part of his Performance-Based Infrastructure initiative.

Let's hope that leaders are able to come together and get something done this session, because clearly the electorate is looking for solutions.

For some recent studies exploring the potential for transportation PPPs in California, see here, here, and here. And see Bob Poole's August 2007 OC Register op-ed here. For a more comprehensive overview of the role for tolling and PPPs in transportation, see here. Lastly, Lisa Snell examines the potential for innovative school facility PPPs here.

The Pennsylvania Turnpike is one of the country's least cost-efficient toll roads, spending a whopping 62.4 percent of its toll revenues on operating and maintenance costs. Of 35 toll roads studied, only the Massachusetts and West Virginia turnpikes spend a higher percentage of their toll revenues on operating costs, according to a new Reason Foundation policy brief by Robert Poole and Peter Samuel.

By comparison, the New York State Thruway has 51 percent more lane miles and handles 83 percent more vehicle miles traveled than the Pennsylvania Turnpike, but its annual costs are $39 million lower.

Over the last seven years the Pennsylvania Turnpike's operating costs have more than doubled from $181 million in fiscal 2000 to $370 million in fiscal 2007. During that same time, the U.S. inflation rate was 23.4 percent, so the Turnpike's costs grew at 4.5 times the rate of inflation.

Press Release
Full Policy Brief: Pennsylvania Turnpike Alternatives: A Review and Critique of the Democratic Caucus Study (.pdf)
Reason's Transportation Research

Recently the editor of the useful magazine TrafficWorld wrote an unfortunately absurd opinion column damning the DOT for its "singular goal" of privatization of roads. I could say a lot about it, but my colleague Bob Poole beat me to it with this excellent letter to the editor.
~~~~~~~~~~~~~~~~~~~~~~~~~~
Dear Paul,

I am dismayed by your editorial, “Private Plan,” in the March 24th issue. I don’t have a problem with people having different views on what makes for sound transportation policy. That’s the normal give-and-take of testing new ideas. But I’m upset when people mis-represent what is actually going on.

First, you criticize the five Urban Partnership Agreement grants whose purpose is to implement some form of road pricing as part of an integrated set of measures to reduce congestion. You criticize this as part of DOT’s “privatization policies”—but none of these five projects involves any privatization whatever. I know, from first-hand involvement, partly as a consultant to Florida DOT helping them craft their winning proposal, and partly as a policy researcher keeping track of cutting-edge policy developments.

Second, you uncritically repeat an allegation in the Washington Post article that the $850 million used for these grants “would have gone to cities for plans including public transit.” This is wrong on two counts. First, the funds in question arose unexpectedly when Congress failed to do its normal extent of annual earmarking of transportation funds, leaving these funds available as discretionary funds for DOT to use as it judged productive. The Office of the Secretary decided to use these funds for Urban Partnerships as part of its Department-wide Congestion Initiative (launched by former Secretary Norm Mineta). These added funds supplemented the very modest amounts DOT had on hand for the ITS and Value Pricing pilot programs, to provide large enough sums to make it worth cities’ while to overcome the usual inertia about making significant change in transportation policy. (They succeeded, generating something like 19 proposals.) Second, to have a chance of winning, an Urban Partnership proposal needed to include all four of the following “T”s: tolling, transit, technology, and telecommuting. So as you can see, transit enhancement was a requirement.

Third, you make the astonishing statement that public transit “is the most cost-efficient way to move people around population centers.” If you have supporting documentation for that statement, I would certainly like to read it. I have been doing transportation policy research for nearly three decades, and apart from extremely high-density traditional central business districts (Manhattan, London, Paris, Tokyo, etc.), public transit is hardly ever a cost-effective choice. There are dozens of peer-reviewed policy papers on the Reason Foundation website (www.reason.org/transportation) dealing with these issues. Most of urban/suburban America – Atlanta, Dallas, Denver, St Louis, Phoenix, etc. – has nowhere near the density to make transit viable, especially rail transit.

Finally, I would be interested in your source for the statement that “this DOT has cut backing for bus and rail projects by more than two-thirds.” The last time I checked, it is the appropriations committees in Congress that decide how much federal support there will be for public transit, and that support has been going steadily upward during the Bush administration.

Sincerely,
Bob Poole
Director of Transportation Studies
Reason Foundation

San Francisco Chronicle transportation writer Michael Cabanatuan reports the Golden Gate Bridge is pursuing variable tolls. The hypocrisy of affluent Marin County commuters and their elected officials in the article is unfortunate. Many are opposing the eminently sensible idea of charging a higher toll at rush hour, which will encourage those who can shift trips to other hours to do so, encourage some commuters to carpool or take the bus, and reduce congestion for all vehicles on the bridge during rush hours. Even more remarkable is the strident opposition to using some or all of the increased toll revenue to replace the worn-out and dangerous approach to the bridge, Doyle Drive. Who do they think is going to finance that project, the tooth fairy? Commuters to and from the San Francisco business district are the primary users of Doyle Drive, and their gas taxes don’t produce anything like the half a billion dollars needed to construct the replacement in the next decade or two. I can’t think of a more urgent and appropriate use for Golden Gate toll revenues than fixing Doyle Drive.

A Joplin Globe editorial says "here is a toll plan that ought to be included in the discussion the next time legislators talk about long-term highway solutions: a public-private partnership to build toll roads for big trucks. Those four-lane routes would parallel interstates 44 and 70 and perhaps even U.S. 71, which one day will be folded into the interstate system."

The column cites Reason Foundation's recent toll roads study, a joint effort with the Show-Me Institute.

Back in 2004 USA Today noted, "Truck-only toll lanes are the brainchild of Robert Poole, an engineer who oversees transportation studies at the Reason Foundation, a libertarian think tank in Los Angeles."

Poole's Studies:
Corridors for Toll Truckways: Suggested Locations for Pilot Projects
Toll Truckways: A New Path Toward Safer and More Efficient Freight Transportation

Via the Indianapolis Star – "Indiana Treasurer Richard Mourdock announced Monday that in 2007 the state earned more than $287 million in interest from its investment of proceeds from the $3.8 billion lease of the Indiana Toll Road."

It’s important to revisit and highlight this massive toll road and financial success because the popular (and incorrect) take on Gov. Mitch Daniels’ lease of the Indiana Toll Road (ITR) for $3.8 billion early in 2006 went something like this: ‘Though it raised a lot of money, the deal was a political loser, costing the GOP control of one house of the legislature and making Daniels a likely one-term governor. Those perceptions weighed heavily in New Jersey Gov. Jon Corzine’s rejection of privatization, in favor of a state-agency 'monetization' of that state’s toll roads (which is also proving very unpopular).’

But the politics of the Indiana Toll Road privatization are not what they seem. To begin with, the initial 2006 election-day fallout was limited to three seats changing hands, which did lead to the Democrats gaining a slim 51-49 edge in the House. But that was then. Today, as the invested proceeds from the ITR lease have jump-started $6.5 billion of major new construction between 2005 and 2015, many labor unions seem to be having a love-fest with the Republican governor. Several union leaders are on Daniels’ re-election campaign steering committee, and last December a bevy of others formally endorsed him for re-election—including the Teamsters, the Operating Engineers, Carpenters, Sheet Metal Workers, etc. And pundits think the GOP has a decent shot at winning back the lost House seats this November.

Besides welcoming all the new highway construction, the labor movement also appreciates that no ITR employees were made worse off by the privatization. All 550 employees were offered jobs with no reduction in pay and benefits either with the toll road company or with the state. According to a recent GAO report, about 85% transitioned to the toll road company, and 115 were offered jobs with the state. All those that left state employment got paid for accrued vacation time, and their pension plan contributions and vested benefits were preserved.

Operationally, the concession company is well along on widening 10 miles of the ITR on the western end, where it is used heavily by commuters into the Chicago metro area, at a cost of $250 million—part of about $700 million in near-term improvements the company committed to as part of the deal. It is also equipping the entire ITR with electronic toll collection (which it never had before)—and has joined the interagency group for interoperable electronic tolling throughout the Northeast and Midwest: the E-ZPass system. The western portion is already in operation, and the eastern section’s electronic tolling will be completed by April.

All of this was enough to provoke Governing magazine into a long and mostly positive profile of Daniels and his first term. Obviously, leasing existing toll roads carries political risks. But when done carefully, the benefits can outweigh the costs.

A new poll shows New Jersey's taxpayers aren’t happy with Gov. Jon Corzine and his toll road plan is getting some of the blame. I've talked with quite a few reporters over the last several weeks, discussing Gov. Corzine's plan to "monetize" the state's toll roads, refinancing them based on huge increases in toll rates in order to bail the state out of its current fiscal hole. In order to get around existing bond covenants, under which all toll revenues must be used to operate, maintain, rebuild, and expand the toll roads, Corzine would create a new "public benefit corporation" which would take over the toll roads. By paying off their existing bonds, the new entity would be free to use toll revenues for whatever its charter called for. Under Corzine's proposal, that would include paying off $16 billion of general state debt.

My problem with this plan is twofold. First, it's grossly unfair to motorists and truckers who use the New Jersey toll roads, 51% of whom (on the NJ Turnpike) are from out of state. They are not responsible for decades of fiscal mismanagement. If anyone should be bailing out the state, it should be the voters and taxpayers of New Jersey, who were asleep at the switch while their public officials spent the state into ruination.

And this gets to my second, related, objection. The extremely high new toll rates—for a truck they would go from $5 in 2008 to $52 in 2033—combine a toll and a tax. The portion that ends up actually spent on maintaining, expanding, and modernizing the toll roads is a toll. But the portion that goes for general state purposes is a tax, plain and simple. Blurring that distinction could greatly harm America's highway system. Converting a toll (a pure user fee) into a tax at the same time as the rates are greatly increased is virtually guaranteed to stimulate opposition to tolls as a method of highway financing.

And that could not happen at a worse time. During the last few years, the global capital markets have discovered the U.S. highway sector as a new investment category. This has occurred just as we're starting to realize the enormity of the investment needs facing us in this sector—for urban congestion relief and for long-haul truck routes, in addition to reconstructing much of our 30- to 50-year-old freeway and Interstate system. The last thing we need is a large-scale backlash against tolling by the motorists and truckers who should be looking to toll finance as a key part of the answer to our highway capital shortfall.

Gov. Corzine decided on the public benefit corporation approach after getting negative feedback to a trial balloon proposal for leasing the toll roads, as Indiana did. Yet it may be that leasing the toll roads to a toll road company with a global track record could raise what the Governor claims to need—without such sky-high toll rates. A source at one such company shared with me some internal number-crunching they have done recently. Remember that the Governor says his plan is expected to generate $37 billion for the state, thanks to the aggressive schedule of toll increases. My source said that when they ran their valuation model using the Governor's toll increase schedule, the value totaled $50 billion. To get the same $37 billion value, their model showed tolls increasing only 3.3 times over the next 15 years, compared with 5 times under the Gov's plan. Alternatively, starting with an even more modest toll rate schedule (today's rates adjusted annually for CPI increases), the model yields a valuation of $18 billion.

So what's with the Governor's numbers? My source could only speculate, citing their own assumptions about "substantial operational savings" and life-cycle cost savings in the modernization program. In other words, the proposition here is that the Gov's plan requires significantly higher tolls because it assumes business-as-usual in how the toll roads operate. It would be very interesting to see what kinds of bids the private sector might submit, if outrage over the Gov's proposed toll increases leads to a search for alternatives.

Reason Foundation's Toll Roads and Transportation Research and Commentary

The New York Times runs an editorial “Mass Transit Needs Congestion Pricing” that shows the problem with many U.S. transit systems – people who don’t use them are asked to massively subsidize them. Congestion pricing makes sense for Manhattan’s horribly congested streets. But I question the Times’ automatic assumption that the revenues from congestion pricing must be used for mass transit. In most toll road systems, the revenues from the prices charged are used to improve the road or bridge for which the motorist pays. Motorists entering Manhattan via the Triborough Bridge, the Midtown Tunnel, and the Battery Tunnel pay high tolls for the privilege, but the majority of those funds are used for the MTA’s transit program—as opposed to modernizing the bridges and tunnels. There are many ways in which congestion pricing fees paid by motorists could be used to improve the City’s inadequate roadway system. But if congestion pricing revenues are going to all be used to subsidize transit, Mayor Bloomberg should at least call the program by an honest name: a Congestion Tax.

Reason Foundation's Transportation and Congestion Pricing Research

In his latest column for Public Works Financing, Reason Foundation's Robert Poole writes,

"Twenty years ago, when some of us began seriously promoting long-term toll concessions as a better way to finance and manage limited-access U.S. highways, we had no idea how difficult the struggle would be. The early wave of enabling legislation-in Arizona, California, Minnesota, Virginia, and Washington State-led to only a handful of projects in what we can look back on as the false dawn of this new paradigm in the early 1990s.

But the second wave that began with the long-term lease of the Chicago Skyway and the 50-year concession deal for the first Trans-Texas Corridor is much larger and more promising. Despite a populist reaction in Texas last year, and some hostile rhetoric from House transportation committee members last spring, states like Florida, Texas, and Virginia have moved forward with billion-dollar-scale greenfield toll projects-and the capital markets are crying for more.

But as I wrote last month, the split on the National Surface Transportation Policy and Revenue Commission exposed the extent of the chasm that must be bridged if the toll concession paradigm is going to be accepted as more than a possibly helpful side-show in 21st-century highways."

Full Column

Reason Foundation’s Transportation Research and Commentary

Everyone will, if transit advocates would actually get their way. A recent study from the University of South Florida for the Florida DOT estimated what it would take to shift households from cars to public transit.

Households would save about $3,500 on average if they gave up their car and hoofed it on public transit. But, here's the kicker: to make transit competitive about half of that savings would go into expanding the transit system. Moreover, 88 percent of the increse in transit ridership comes from households moving from one car to zero.

So, the only way to boost transit ridership in a meaningful way is to eliminate automobiles, if not directly then indirectly. By making conditions so miserable for automobile use, people won't even buy a car, let alone use it

Where do these conditions exist? Try Manhattan. At more than 50,000 people per square mile, fewer than 5 percent of residents commute by car.

Oklahoma is yet another state joining the knee-jerk backlash against leasing public roads to private companies. Once again, Republicans are leading the charge.

Oklahoma City state rep. Sally Kern is complaining about private companies requiring roads to pay their way. Toll road leases allow tolls to go up, usually at a moderate and highly regulated rate, so that the road can be upgraded and well maintained. Yet. Rep. Kern thinks taxpayers are better off funding the road:

House Bill 3182 states that the Turnpike Authority “shall not enter into any contract with a private company to sell, lease, sublease, or operate any turnpike or portion of a turnpike in this state.”

“Foreign companies have been buying turnpikes ... and when they do tolls immediately go up,” Kern said.

Len Gilroy and Bob Poole have written extensively about these myths. Check out their Frequently Asked Questions and Bob Poole's working paper on public private partnerships in Texas.

Investor's Business Daily had a great editorial on the recent proposal to hike the gas tax. They point out that less than 60% of the gas tax revenue goes to "essential" roadwork. The rest goes to pork (10%) and transit (30%).

They write:

Worse, no longer are revenues from the federal gasoline tax dedicated solely to building and maintaining the interstate highway system. That changed in 1983, when a little more than a 10th of revenues were used for mass transit. That has now tripled to 30%.

But that doesn't mean that 70% of the gas tax is dedicated to paying for our highway infrastructure. One-tenth of federal transportation spending is pork. In the last transportation bill, more than 6,000 pet projects costing $24 billion drained money away from where it was needed.

....

At the end of the day, a mere 60% of the revenues are left for essential road work. If that's not enough, lawmakers could have an immediate 67% increase in funds if they would only devote all the revenues from the gasoline tax to valid road projects.

Thanks to NCPA's Policy Digest for making sure the editorial didn't slip through the cracks. You can subscribe to NCPA's pithy daily update on policy news here.

Upon hearing the news of the passing today of Ric Williamson, chairman of the Texas Transportation Commission, I am reminded of a quote attributed to Goethe: "Boldness has genius, and magic and power in it."

After serving seven terms in the Texas legislature from 1985 to 1998, Williamson was appointed to the Texas Transportation Commission by Governor Rick Perry in 2001 and became perhaps the key architect of the state's bold embrace of tolling and public-private partnerships as the primary means of addressing the state's massive urban congestion woes and staggering transportation infrastructure needs. While other states had taken tentative steps in this direction, Texas took the bull by the horns and ran with these ideas in a way that catapulted it to the front of the pack, placing it far ahead of other states in its willingness to not only facilitate, but also to institutionalize, the use of these cutting-edge concepts.

Charged by Gov. Perry with modernizing a transportation system that had not been managed to deal with the rapid population and economic growth that was occurring in Texas, Williamson undertook a methodical process of quantifying the extent and scope of the state's transportation needs and identifying a range of short-, mid-, and long-term strategies and solutions to address the needs. Then came the herculean task of implementation, and bolstered by Williamson's vision and leadership the Commission has presided over something unfortunately rare in government--a paradigm shift of massive proportions in a major state agency (the Texas Department of Transportation). So often in government, innovative ideas and bold visions are relegated to large reports that ultimately gather dust on dark bookshelves hidden from the light of day. But in this case, TxDOT jumped headfirst into a new way of doing business, a fact that owes much to Williamson. From these efforts came a powerful set of new tools--such as private-sector financing, pass through tolls, the Texas Mobility Fund, and the Trans-Texas Corridor--designed to allow the state to address its congestion, mobility, goods movement, and environmental challenges.

I've met numerous elected and appointed officials in recent years, many of them intelligent, passionate and accomplished, but I can honestly say that no one impressed me as much as Ric Williamson. I had the fortune of conducting a lengthy interview with him this past fall, during which he blew my mind with his ability to spontaneously articulate the different aspects of the "Texas model" with clarity, intelligence, depth, and purpose.

Beyond that, having previously read description after description of Williamson as a "bully," or as "arrogant"--the "most hated man in Texas," according to Texas Monthly writer Paul Burka--I was pleasantly surprised to find that, in person, Williamson's intelligence and purposefulness was only exceeded by his humanity. Instead of starting our interview immediately, he spent the first several minutes asking me about my life, my work at Reason, and my mother (who's from San Antonio), and I then spent the next 45 minutes or so glimpsing into the mind of an intelligent and shrewd, while simultaneously thoughtful and gentle, man. When I saw him at a conference again in November (figuring he wouldn't remember me), he greeted me like an old colleague and the same humanity shined through.

What I came to realize is that Ric Williamson exemplified that rare breed of public steward--a gentleman, leader, and innovator bolstered by his experience and the courage of his convictions. Individuals like Williamson that are willing to push the envelope and move in bold new directions are often misunderstood, misinterpreted, and shunned until the rest of society catches up to them. As Texas Senator John Carona stated today, "[Williamson's] ability to see far into the future, coupled with his command of process and the here-and-now, ensure his place in our history books when the story of 21st century Texas is told." Not only is Texas better off for his leadership, but given the degree to which other states are starting to emulate Texas on the transportation front, I'd bet that Williamson's impact will ultimately be felt far beyond the borders of Texas.

For more on Ric Williamson, these pieces are well worth a read:

• Fort Worth Star-Telegram on Williamson's passing


• Williamson remembered as committed visionary (Fort Worth Star-Telegram)


• Peter Samuel (TollRoadsNews.com) on Ric Williamson

UPDATE: My original post focused exclusively on transportation, but I failed to highlight Ric Williamson's leadership on tax and fiscal policy during his tenure as a legislator. As the Dallas Morning News notes this morning:

Mr. Williamson spent 13 years in the Texas Legislature, much of it fighting for sensible state spending, colleagues say. [...] He went to the Legislature in 1985 a Democrat and left in 1998 a Republican. Serving on the House Appropriations Committee, he was one of the "Pit Bulls," conservative lawmakers (including Mr. Williamson's Austin roommate, Mr. Perry) who questioned how the state spent its money. He believed that agencies should get money based on the goals they set and met – not just based on what they ask for. That concept, performance-based budgeting, is used today.

More from the FWST:

Williamson, who in the private sector operated a natural gas production company, was a conservative Democrat in 1984 when he first won a seat in the Texas House representing a largely rural district west of Fort Worth anchored by Weatherford. He came to the House at age 33 as Texas was reeling from a slump in the oil industry, which strained the state budget.

Along with a coalition of other conservative Democrats and many of the then-outnumbered Republicans in the Legislature, Williamson pushed for steep cuts in state spending in an effort to hold the line on new taxes.

It was during that period that he befriended Perry, another rookie lawmaker with similar West Texas roots and conservative Democratic leanings. Both would change their party affiliations to Republican as their careers advanced.

This excerpt from my recent interview with Williamson gives a glimpse into his thinking on tax policy:

"I determined from my years in politics—and just observing, just common sense, listening to people—that there was a reason why, all across our country, citizens less and less support general taxes into a common pool to be distributed by political decision makers. There’s a reason why people vote for Republicans and Democrats who claim that they won’t raise those common taxes, and the reason is, our citizens, whether we like it or not, have decided that it’s not in their best interest to permit themselves to be taxed in common and the money put into a common pool to be distributed based on political will. They have rightfully, I think, ascertained that when that occurs, the investment of the tax revenue is not made in the best interest of their welfare, but rather in the best interest of the welfare of the elected class."

Earlier this week, France's transit workers went on strike. Guess what? Not much happened in terms of traffic and congestion. The Washington Post speculates that it's because most people took the day off.

While the strike virtually immobilized public transportation -- only 10 percent of the Paris Metro system was running, and only 46 of France's 700 high-speed trains were in operation -- the country escaped the mass chaos that many had predicted. Some city residents speculated that Parisians, warned of the possibility of huge commuting delays and virtually no public transportation, simply decided to take the day off.

Perhaps another reason is that most Parisian's don't use transit! They drive.

Wendell Cox has put together a nice summary of the demographics, economics, and transport of the Paris region, and its available at http://www.demographia.com as part of his rental car tours.

Wendell points out that transit is crucial to transport in the city center, where population densities rival Manhattan's at 53,000 people per square mile. The Ville de Paris (our equivalent of a central city) houses about 20% of the region's population.

But, outside the Ville de Paris, development is lower density and suburban in character. Inner ring suburbs average about 17,500 people per sqare mile, enough to support good bus service by not high quality rail service. In the outer ring suburbs (the most recently developed), densities average 4,500 people were square mile. These densities are comparable to America's newer suburbs in the West and Southwest, and the automobile rules.

Indeed, Wendell notes, Parisians may have access to the most well developed system of roads and freeways in Europe. Overall, about three-quarters of travel in the Paris region is by car.

Last week, Reason's Sam Staley debated sustainable transportation policy with Todd Litman of the Victoria Transportation Institute at Colby College's Goldfarb Center for Public Affairs and Civic Engagement. Todd started out his presentation by asking the teenage and twenty-something audience to envision paradise, and whether they aspire to live in a suburb. Sam responded by saying he lives in the real world where trade offs have to be made, and a suburb is where he ended up. Transportation policy needs to apply to the real world, not abstract ideas that don't reflect the way people live.

The debate was podcast, and you can listen to it by clicking here.

In the first video of the Drew Carey Project at Reason.tv, Drew takes a look at the sorry state of congestion in America's urban areas. And at the ways to get rid of congestion if we just had the political will. It is serious and entertaining, as he gives the guy with the worst commute in Los Angeles a ride to work in a helicopter-----once.

Watch the video here.

. . . the John Birch society flames you for calling bullshit on some of their crazier ideas.

The op/ed that got them so excited here.

It's pretty tough to separate drivers from their cars, but China's going to try:

China will initiate its first-ever nationwide "no car day" this weekend in an effort to promote environmental health and alleviate increasingly gridlocked urban roads, state press said Monday.

Residents in 108 cities will be urged to take public transport, ride bikes or walk on the nation's first "no car day" on Saturday, the China Daily reported.

"The move is an attempt to raise residents' awareness on energy saving and environmental protection because the country's cities are plagued by traffic congestion and pollution," the paper said.

It did not say why the Ministry of Construction, the sponsor of the activity, chose a Saturday to hold the event.

Government officials and state-run enterprise employees in some cities would be encouraged not to drive, while other urban centres would ban government-owned cars from taking to the roads altogether, it added.

A week-long campaign to publicise the government's goal of getting 50 percent of the nation's urban residents to use public transport instead of private cars would also be initiated, it said.

Article here.

Mexico City has a long history of yanking keys from drivers. Officials figured that would have to cut pollution and boost transit ridership. They underestimated their constituents.

RELATED: Paris vs. SUV

In their book, The Road More Traveled, and in their Reason magazine article earlier this year, my colleagues Ted and Sam describe the transportation planning dysfunction that has taken hold in so many metro areas: automobility and congestion relief are not high on the priority list because planners are preoccupied with policies designed to get people out of their cars. Since people like to drive and have not proven amenable to playing along with the planners' charade, our public policies and spending priorities in many metro areas are just making traffic worse (i.e., "planned congestion" is the inevitable result). For a refresher, here's Ted and Sam on the Met Council, the transportation planning body for the Twin Cities:

During the next 10 years, the Met Council is planning to invest $4.2 billion in the highway system and $1.4 billion in transit facilities. In other words, the region's primary transportation planning agency has decided to spend 25 percent of its budget on mass transit. But transit accounts for just 2.5 percent of all trips in the region, whether they're for pleasure, taking kids to school, going to the supermarket, or commuting to the office. Less than 5 percent of the Minneapolis-St. Paul region's population uses public transit to get to work, and that share is declining: According to U.S. Census statistics, the number of passengers using mass transit increased slightly in absolute terms between 1990 and 2000, but its market share fell by 12 percent.

The Met Council hopes to double bus capacity by 2030 and greatly expand its light rail line and commuter train system. It also intends to boost transit use from 74.9 million passenger trips per year to 150 million by 2030, even though the current trend projects virtually no growth in use and even though transit lost market share from 1990 to 2000, according to the Census Bureau's decennial data. The Met Council expects 574,625 new jobs to be created in the area by 2030. But even though the vast majority of Minneapolis-St. Paul's population travels to work by car, the planners improbably expect per capita road use to decline. [...]

The net result? Without road improvements, highway congestion is expected to increase from 28 hours annually per traveler in 2001 to 40 hours in 2030. With the improvements, congestion should "moderate" to 37 hours in 2030. Congestion would be 32 percent higher than in 2001, rather than 42 percent higher without the improvements. "Just to keep pace with these [highway] needs," the council's 2030 Regional Development Framework says, "would add $4.7 billion to current plans for the next decade" above the currently planned spending. [...]

To make "more effective use" of the road system, the Met Council believes it has to get people out of their cars. That's unfortunate, especially since the agency admits congestion is many residents' "No. 1 livability issue." The council is spending 25 percent of its transportation funds on a solution that, at most, might improve the quality of life for 5 percent of the population, and it will do nothing for people like Sue. Even transit users might not be better off, since they will be spending more time commuting than if they used a car. Drivers will definitely be worse off. They will be spending much more time stuck in traffic in 2030 than they did in 2006.

If Minneapolis has one of the best planning agencies, what are the others like?

I guess that we'll know about Baltimore soon enough. A current stir over Baltimore's metropolitan transportation plan offers an insight into the politics at play behind these sorts of planning decisions. So let me get this straight--in a metro with a 2.1% transit market share, the planners are suggesting that 29% of spending be set aside for transit projects, and the transit advocates are up in arms because it's not at least 50%?? I was still choking on the 29% figure--eerily reminiscent of the Twin Cities example--when I read that transit advocates wanted even more. This is so pathetically dim-witted that it would almost be laughable--if these weren't real tax dollars, real lives, real mobility, and real prosperity at stake.

I had a piece in Sunday's LA Daily News:

"YOU'VE got to use public transit," Los Angeles Mayor Antonio Villaraigosa declared. "You can't keep on pointing to someone else and saying it's their responsibility."

Imagine the credibility and public-relations points Villaraigosa could have racked up uttering those words while commuting on a bus to City Hall. But instead of being the "eco-friendly transit-riding mayor," Villaraigosa rides an SUV to work.

Yet many Angelenos probably sympathize with the mayor. "Give me a first-rate transit system, and I'll use it," they might say. Until that system arrives, they support new transit proposals, like the $5 billion "subway to the sea," while continuing to drive everywhere.

But what would it say about the practicality of mass transit if the mayor of the city with the nation's best subway system also took an SUV to work?

More here.

Related: Do transit board members ride transit?

In a recent Arizona Republic article, Congressman Jeff Flake (R, Arizona) breaks down why more of the same old/same old is not going to help us solve our transportation infrastructure needs:

While the “Bridge to Nowhere” was certainly the most famous of these earmarks, it at least resembled a transportation project. The most recent transportation authorization was replete with earmarks for bike paths, hiking trails, visitor centers, museums, beautification work, and other suspect projects that seem even more suspect given the events of the past months.

For example, Minnesota received more than 140 earmarks in the highway bill worth nearly half a billion dollars. According to a recent review, these included nearly $1.6 million for bike trails, more than $1.5 million for streetscaping, and more than $1 million for new visitor centers. With the state’s priorities undoubtedly shifting in light of recent events, Minnesota should have the flexibility to use its transportation funds as it needs to rather than on projects such as these.

Obviously, this problem is not limited to Minnesota. Congressional Quarterly recently highlighted that nearly all of the fifty most heavily traveled and structurally deficient bridges are concentrated in Los Angeles and San Francisco. My guess is that California has better uses for transportation dollars than the $5 million dollar earmark for bikeways and trails in the Golden Gate National Recreation Area or the $2.3 million dollar earmark for landscaping enhancements for “aesthetic purposes” along the Ronald Reagan Freeway in Simi Valley. These earmarks are even more egregious when you realize that California, like Arizona, is a “donor state,” meaning it receives less than a dollar worth of federal transportation funding for every dollar it pays in federal gas tax.

We can all agree that the Minnesota bridge collapse should serve as a wake-up call. Congress cannot continue to turn a blind eye to pork barrel politics that all too often reward the districts of powerful Members of Congress and tie the hands of state transportation officials. With this in mind, I plan to introduce legislation that will allow states the flexibility to use their transportation dollars as they see fit.

Both President Bush and Secretary Peters have both wisely dismissed calls for raising the gas tax and have called Congress out for squandering much-needed transportation funding on earmarks. The last thing we need is to raise the gas tax, which will simply give Washington politicians even more money to spend on earmarked projects.

My colleague Bob Poole discussed more of the problems with the current highway funding system in his latest Surface Transportation Newsletter:

I fault the current federal highway funding system on two key points. The first is its long tradition of, and recent major uptrend in, allocating money to congress-members' pet projects--rather than to projects that yield the most bang for the buck in addressing real transportation needs. A system that spends lavishly to build bridges to nowhere, while over 75,000 bridges are in danger of collapse and another 79,000 can't handle today's demand, is a system that cries out for fundamental change.

The other basic problem is that the federal funding system, by design, shifts resources from populous, fast-growing states to low-population, low/no-growth states. You can understand why this was done originally: to make sure that Interstate links got built through rural states where there wasn't enough traffic to generate enough fuel-tax revenue to cover the cost. But that was then, and this is now. Today we have massive needs in specific locations: to expand urban expressways to alleviate congestion and to expand the capacity of key Interstate routes to keep commerce flowing. Yet the federal funding mechanism still takes funds from the states where these needs are greatest and sends them to places like Alaska and North Dakota. We couldn't have designed a more perverse approach to solving our highway investment problem if we tried.

Yet the simplistic answer of simply pumping more money into this flawed federal system is the best many pundits and analysts can do. That's pathetic.

Yes, we do need a major, sustained increase in capital investment in America's highway system. But those investments need to be targeted to critically important goods-movement and congestion-relief projects. The best way to do this is to turn to the capital markets, creating mechanisms to direct eager capital to projects that pencil out as viable investments. To their great credit, that's what DOT Secretary Mary Peters and her team have been trying to do, with their aggressive efforts to explain the merits of tolling, value pricing, and public-private partnerships. Before we rush into new federal crash programs and arbitrary fuel-tax increases, we should make a serious effort to figure out how much of the problem can be addressed with these critically important tools.

I think it's safe to assume that, given recent developments in tolling, we can address more of the problem than previously thought. See Bob's recent comments on this subject here.

I've suggested that one under appreciated reason Americans work so much is that lots of people like working. Unlike days gone by when so many were stuck in fields or factories, more of us have jobs that we find quite fulfilling.

But, come on, vacation is still great, and some American companies offer the unthinkable--unlimited vacation days:

It’s every worker’s dream: take as much vacation time as you want, on short notice, and don’t worry about your boss calling you on it. Cut out early, make it a long weekend, string two weeks together — as you like. No need to call in sick on a Friday so you can disappear for a fishing trip. Just go; nobody’s keeping track.

That is essentially what goes on at I.B.M., one of the cornerstones of corporate America, where each of the 355,000 workers is entitled to three or more weeks of vacation. The company does not keep track of who takes how much time or when, does not dole out choice vacation times by seniority and does not let people carry days off from year to year.

Instead, for the past few years, employees at all levels have made informal arrangements with their direct supervisors, guided mainly by their ability to get their work done on time. Many people post their vacation plans on electronic calendars that colleagues can view online, and they leave word about how they can be reached in a pinch.

“It’s like when you went to college and you didn’t have high school teachers nagging you anymore,” said Mark L. Hanny, I.B.M.’s vice president of independent software vendor alliances. “Employees like that we put more accountability on them.”

Sure there are plenty of trade-offs (do you really want to be on call during vacation?), but it works for plenty of workers. Two more examples of a kick-back view of vacation:

Motley Fool, the online investment adviser, has, since its founding 13 years ago, let employees take as many paid vacation or sick days as they need; the company’s director of human resources, Lee Burbage, said that most of its 180 workers take three to four weeks a year. Netflix, the online DVD distributor, no longer allots specific numbers of vacation days to its 400 salaried employees.

“When you have a work force of fully formed professionals who have been working for much of their life,” Patty McCord, the chief talent officer of Netflix, said, “you have a connection between the work you do and how long it takes to do it, so you don’t need to have the clock-in and clock-out mentality.”

Not surprising that a friendlier attitude toward telecommuting is also common among these companies:

The hands-off approach to vacation time, which gradually took hold over the past decade, has come amid I.B.M.’s shift from engineering and manufacturing into services like consulting and is part of a broader demise of old notions of eight hours’ pay for eight hours’ work at a fixed location.

Aided by broadband connections, cellphones and video conferencing software, 40 percent of I.B.M.’s employees have no dedicated offices, working instead at home, at a client’s site, or at one of the company’s hundreds of “e-mobility centers” around the world, where workers drop in to use phones, Internet connections and other resources.

...

“If you look at the organizations that have done more radical things, they tend to be technology companies with salaried people,” where flexibility in job performance “is embedded into the culture of the place,” noted Max Caldwell, a managing principal in the work force effectiveness area at Towers Perrin, a human resources consultant.

Indeed, I.B.M.’s Mr. Calo said that the flexibility has helped the company compete with the more freewheeling atmosphere at start-up rivals in the technology world that have lured away some of its talent over the years.

“We have a reputation of not being as hip as a Google or a Netflix,” he said. “You don’t have to be the coolest guy on the block, but you don’t have to be the Big Blue nerd, either.”

NYT article here.

My take on HP falling away from telecommuting here.

One of the more impressive transportation technologies we saw in Beijing was a consumer friendly approach to traffic routing. The Beijing municipal government had developed a GPS technology that would allow drivers to access the Internet from their PC or cell phone and identify the quickest way to their route using real time data from satellites. We wondered why no one was working on this in the U.S., where reading neon signs over the road telling you your already in congestion passes for state of the art.

Well, it turns out, someone was. But it wasn't the local transit authority, or the local transportation planning agency. They're too busy trying get people out of their cars, not making their trips easier. It was Google. Google has just launched a new technology with its on-line mapping technology that allows users to find the fastest route, add multiple stops, and avoid congestion. Users can "drag and click" new destinations and routes. It's part of google maps' "Draggable Driving Directions". A video demonstrating the technology can be found here.

As traffic congestion gets worse, and iPhone technology becomes more diffuse, the short-term prospects for this technology are pretty strong. Once again, Google shows why its ahead of everyone else in the U.S.

Earlier today I was on KCRW's "Which Way, LA?" (SoCal NPR) talking about what LA might do to pull itself out of gridlock.

The show should eventually be achieved here.

And here's to WWLA's ultra-classy host, Warren Olney.

From yesterday's LA Daily News:

WOODLAND HILLS - He can't stand spending one more minute in traffic.

And after commuting all week to work at Warner Center, Divine Hicklin usually stays home on weekends to take a break from battling the bulging bottlenecks on the roads.

"When the weekend comes, I want to stay home, in my pajamas, in front of my computer and away from traffic," said the downtown Los Angeles commuter. "I do it all the time."

Whether behind the wheel or sitting on a bus, Los Angeles commuters spend about 93 hours a year stuck in traffic. And those like Hicklin often end up feeling so wiped out by the gridlock, they're becoming increasingly inclined to stick - whenever they can - to their own little neighborhoods on weekends.

"I think a lot of us have gotten used to not doing things," said Ted Balaker, policy analyst for the Reason Foundation, a Los Angeles-based nonprofit. "It makes this city less of a grand metropolis and more into isolated hamlets."

As congestion makes it more trying to get around, Balaker said Angelenos are subconsciously paring back their lives in everything from where they choose jobs to visiting friends on another side of town or even eating out in a different area.

Many don't even realize what they're giving up in life because they're trying to avoid traffic, said Balaker, author of a report released last month that assesses the impact of mobility on personal lives.

But as congestion grows, people ultimately are becoming less spontaneous and less adventurous.

Read Sue Doyle's interesting piece here; some interesting reader comments below the fold:

Each day this week The Antiplanner mulls a different aspect of this question.

Check it out; first day's post is here.

Light rail ground breaking ceremonies often have that pep rally vibe: they're filled with live music, bold proclamations, group hugs, fireworks, cheerleaders, and even free bbq sandwiches.

LA just broke ground on the Expo Line, but the reporters' tone is rather bittersweet:

Standing amid mounds of dirt at the edge of USC on Friday, political leaders celebrated a milestone for L.A.'s fledgling rail system: the start of major construction for a rail line from downtown to the Westside.

But like so many mass transit projects in Los Angeles County, the Expo Line was shaped by three decades of political squabbling and compromises that raise questions about whether it can achieve the goal of getting Westsiders out of their cars and onto mass transit.

The first 8.6-mile leg of the line will run from the 7th Street/Metro Center station in the heart of downtown to Culver City. But it will be nowhere near many of the Westside's most congested destinations, including the Miracle Mile, Grove-Beverly Center areas, Beverly Hills, West Hollywood, Century City and Westwood/UCLA.

Instead, it will move along an old Southern Pacific rail line through relatively quieter southwest L.A., roughly following Exposition Boulevard. The route avoided heavy opposition from community groups and reduced costs, which will be at least $640 million. The line is supposed to start operations in 2010.

As a result of that route, officials expect the Expo Line to Culver City to see 43,000 passenger boardings every weekday by 2025. (A boarding is a one-way trip.)

Kudos to the reporters for pointing that out. Might also be nice to mention that most rail riders aren't new transit riders, but merely folks who used to ride buses. One thing I almost never see reporters do is give some big-picture perspective--after all, LA County takes 40 million trips a day.

The MTA has already been struggling with rail lines that have not quite worked out.

The Green Line does not hit major destinations such as Los Angeles International Airport and the South Bay Galleria mall near its route, but instead goes from Norwalk to a miniature golf course in north Redondo Beach.

The Gold Line from downtown to Pasadena has also been a disappointment, largely because it runs close to residential neighborhoods and hits so many street crossings that taking the train is significantly slower than driving.

For safety reasons, the state Public Utilities Commission restricted the speed of Gold Line trains in parts of South Pasadena and Highland Park. Expo Line trains may suffer some of the same problems as they cross major north-south streets, such as Vermont, Normandie and Western avenues and Crenshaw Boulevard, and may have to slow as they approach intersections, experts said.

And how about that Red Line? It still has still not reached half its projected ridership. (Is that the kind of success that should be extended to the sea?)

Reason's transportation work is featured prominently in four different newspapers today. First up, our founder and director of transportation studies Bob Poole has an excellent piece in today's Orange County Register highlighting the role the private-sector can play in meeting our national transportation infrastructure needs. Here's an excerpt:

Unfortunately, the predictable, status quo responses to the Minneapolis tragedy have already begun: a new federal spending program to fix roads and much higher federal and state fuel taxes.

Both suggestions are off-target. The 2005 federal transportation bill doled out $286 billion, no small chunk of change. Before the feds hike the gas tax any further, government needs to prioritize spending, to focus on critical infrastructure projects instead of "bridges to nowhere" and thousands of other "earmarked" pet projects. If Congress fails to enact fundamental reforms, taxpayers will be justified in rejecting new gas-tax hikes.

For the major highway investments we need—such as rebuilding Interstates and adding capacity to congestion-choked expressways – there's a better way to pay. Texas, Virginia, and other fast-growing states have demonstrated the new model: highway public-private partnerships funded by direct user payments (tolls). In today's new toll-road model, private companies compete for long-term contracts to design, finance, build, operate, and maintain major highways and bridges. The companies recoup their investments by charging tolls.

. . . .

People are tired of sitting in traffic – and they are willing to buy their way out. Toll roads are more equitable than gasoline taxes because you only pay for the roads you use. And the private sector, unlike the government, builds roads based on where demand is highest – not where a politician or special interest group wants a pork project.

We can rehabilitate our aging infrastructure. We can relieve traffic congestion. And we can transform our roads and bridges into a 21st century network that offers increased mobility for individuals and businesses. But to do so, we are going to have to break free of the old model that relies only on government to pay for, build and maintain our highways.

Second, an LA Times editorial today--aptly titled "Kids aren't carpoolers"--makes the case that we've been making for some time (most recently here and here): HOV lanes don't work:

Research shows that most of the people who use carpool lanes, which typically require two occupants per vehicle, aren't teaming up to get to work. They're usually families going to school, the mall or somewhere else. A mom who is allowed to use the carpool lane because she's got an infant strapped in the back seat is not helping to get cars off the road; that kid wasn't going to be driving even if he weren't sharing a ride.

Meanwhile, many of the state's carpool lanes are at or near capacity; at rush hour they're often as slow as the other lanes. (The Legislature is partly to blame for this. In 2004, it passed a shortsighted law allowing solo drivers of hybrid cars to use carpool lanes. No such incentive was needed to boost the sales of hybrids.) This isn't to say that widening the 5 and 405, as Caltrans proposes, is a bad idea. But with the state investing billions of dollars in new carpool lanes, it makes sense to revisit the rules on their use to make them more efficient.

Some traffic experts, notably the libertarian scholars at the L.A.-based Reason Foundation, propose turning carpool lanes into toll lanes. Buses and registered vanpools could still use them for free, but everybody else would have to pay. It's a notion worthy of study, especially considering the success of the 91 Express toll lanes in the median of the Riverside Freeway.

[one caveat--the Times argues that a better solution than HOT lanes would be to require at least two occupants of vehicles using carpool lanes be licensed drivers, arguing that it would free up HOV lanes for actual carpoolers. In addition to the impracticality of enforcement, you would lose the invaluable benefit of pricing. Pricing is the only known way to maintain free-flowing lanes and ensure sustainable, long-term congestion relief.]

Lastly, Reason's 16th Annual Report on the Performance of State Highway Systems was cited in two editorials today-- one in the Philadelphia Daily News and another in the Providence Journal.

My pal Tory Gattis--purveyor of the excellent Houston Strategies blog--had an interesting post last week on long term toll road concessions. Tory has generally been fairly skeptical of concessions up to this point, but in his post he concedes that it might be a good thing if the private sector absorbs the risks of increased telecommuting, higher fuel prices, etc., which could result in future traffic and revenues far below what's projected in today's forecasts.

Though reasonable people may disagree on the likelihood of that actually happening, he certainly points out one of the key benefits of public private partnerships--transferring the risks of traffic and revenue shortfalls (as well as construction cost overruns) to the private sector partner.

Reading through his original post and reader comments, I noticed what seemed to be some misunderstandings regarding some of the details of PPPs that I felt compelled to respond to, and Tory generously offered me the opportunity to discuss them in a guest blog post. It's pretty long, so for brevity's sake, I won't repost it here.

For more details on concessions and transportation PPPs, check out these recent Reason publications:

• The Role of Tolls in Financing 21st Century Highways (May 2007)
• Annual Privatization Report 2007: Surface Transportation (July 2007)
• Tolling and Public-Private Partnerships in Texas: Separating Myth from Fact (May 2007)
• Building New Roads Through Public-Private Partnerships: Frequently Asked Questions (March 2007)

Imagine all the great pup public officials, especially adamant transit-backers, could enjoy if they took transit regularly.

And yet transit board members in DC, and Philly typically steer clear of transit. Other than photo ops, Mitt Romney has trouble recalling any time he's used transit. LA Mayor Antonio "Subway to the Sea" Villaraigosa wags his finger at motorists who eschew transit, but prefers traveling in a GMC Yukon.

But the MetroCard Mayor has access to our nation's most extensive transit system. Certainly, he has no use for SUVs:

He is public transportation’s loudest cheerleader, boasting that he takes the subway “virtually every day.” He has told residents who complain about overcrowded trains to “get real” and he constantly encourages New Yorkers to follow his environmentally friendly example.

But Mayor Michael R. Bloomberg’s commute is not your average straphanger’s ride.

On mornings that he takes the subway from home, Mr. Bloomberg is picked up at his Upper East Side town house by a pair of king-size Chevrolet Suburbans. The mayor is driven 22 blocks to the subway station at 59th Street and Lexington Avenue, where he can board an express train to City Hall. His drivers zip past his neighborhood station, a local subway stop a five-minute walk away.

That means Mr. Bloomberg — whose much-discussed subway rides have become an indelible component of his public image — spends a quarter of his ostensibly subterranean commute in an S.U.V.

...

Mr. Bloomberg, who entered politics as a self-made media mogul, struck a populist note early in his mayoral campaign by pledging to use mass transit. Since starting at City Hall he has invited reporters, photographers and television news anchors to ride along with him.

The image of the billionaire straphanger has paid enormous political dividends. One transit group designated him the “MetroCard mayor,” and Newsday lauded him as the city’s “regular Joe Commuter.” Shortly after he took office, The New York Times declared Mr. Bloomberg “the first subway-riding mayor.” And his tales from the underground — for example, getting stranded on a northbound No. 4 train for half an hour — have made for useful anecdotes at his news conferences.

Mr. Bloomberg’s use of the subway to get to work appears to have declined over time. In January 2002, he reported taking the train all but one day of his first three weeks. Nowadays, it app