Unreconstructed, the Tappan Zee goes down.
That grim, disturbing vision of this region”™s future if the status quo holds appeared on a film screen that was a backdrop to a milling crowd of transportation and construction industry players gathered recently at Iona College in New Rochelle. In a simulation created for a TV program last year, the Tappan Zee Bridge, riddled with rust and its wooden pilings rotted, collapsed like a slow-falling chain of dominoes into the Hudson River.
That scenario of disaster ”“ already made fatally real with the collapse in 2007 of an interstate highway bridge in Minneapolis, Minn., and on the state Thruway with the collapse of the Schoharie Creek bridge in 1987 ”“ could unfold across the nation as state and federal transportation systems deteriorate from years of financial and physical neglect and overuse in a nation whose population is projected to increase by 120 million persons over 50 years. How to avert that crisis and find financial solutions in a stricken economy and prevailing climate of political inertia and tax protest brought industry experts to the annual infrastructure conference at Iona, sponsored by Terex Corp., the construction equipment manufacturer based in Westport, Conn.
National strategy needed
In Connecticut and New York, “We have some of the biggest challenges in the U.S.” for infrastructure improvements, Connecticut Transportation Commissioner Joseph F. Marie said.
“We do have a very acute challenge in the Northeast to pay for this.”
In Connecticut, 30 percent of bridges are structurally deficient and 30 percent are structurally obsolete, Marie said. In New York, more than half of all local bridges will need repair during the next decade. Repairing or replacing state and local highway bridges in New York will require a 20-year capital investment of $30.6 billion, according to the state Department of Transportation. The deficit-burdened state”™s total capital needs for transportation infrastructure over two decades amount to $175.2 billion.
Stanley Gee, New York”™s acting commissioner of transportation, said transportation funding from all levels of government must be doubled.
Marie and other conference panelists said the U.S. has fallen behind countries in Europe and Asia in maintaining and expanding highway, rail and water transportation systems. The European Union has created an infrastructure investment bank for its 27 nations, Marie said. Thomas Murphy, former Pittsburgh mayor and senior resident fellow at the Urban Land Institute, said federal officials have discussed creating that European investment model here. “If that happens, I think there”™s reason to hope,” he said.
Though two national commissions released recommendations on transportation policy and finance in 2008 and 2009, the U.S. still has not adopted a national strategy for investing in infrastructure, the experts said. Instead, the government continues to rely almost entirely on the 89-year-old federal gasoline tax as its revenue source, they said.
The federal gas tax has remained at 18.3 cents per gallon since 1993, said Ronald Marino, managing director in the municipal securities division of Citigroup Inc. If it is not raised to the rate of inflation or slightly above, infrastructure will continue to deteriorate, he said. Marino said raising the New York gas tax by 1 cent would generate $61 million to $63 million.
Peter Ruane, president and CEO of the American Road and Transportation Builders Association, said the federal gas tax and other transportation user fees must be raised at least 10 percent “just to tread water.”
Marino, citing a Federal Highway Administration study, said a $1 billion investment in transportation infrastructure produces 31,000 to 40,000 construction jobs and 5,000 to 6,000 permanent jobs.
Seeking alternative funding sources
“There”™s no secret that infrastructure is the key to economic growth and recovery,” said Congressman Jerrold Nadler, who serves on the House Transportation and Infrastructure Committee. He said the American Society of Civil Engineers has calculated that $2.2 trillion is needed over the next five years to restore all infrastructure in the nation to good condition.
Nadler said the two-year federal stimulus program, which allocated $25 billion to $27 billion for highway, bridge and road construction, “was simply too small to do what it had to do for the economy.”
The stimulus package was “a shot in the arm at the right time,” Ruane said, but “it has not solved the problem.” More than 30 states cut their transportation spending when the stimulus program began and the federal funds “became a substitute, so there was no net effect,” Ruane said. He said the construction industry has lost about 50,000 jobs on highway projects this spring compared with a year ago.
Nadler, a proponent of less costly and more energy-efficient rail freight transport in the metropolitan area, supports a $500 billion, six-year surface transportation authorization bill introduced in the House, which he said will create or sustain approximately 6 million jobs. But federal officials still must find revenue sources to support that infrastructure spending. “A straight increase in the gasoline tax should be part of what we do, but it will be hard” to pass through Congress, he said.
Nadler said the government”™s overreliance on the gas tax is “at war” with the national effort to reduce gas consumption and dependence on foreign oil.
The congressman and other experts said private-public partnerships could be a means of infrastructure financing. The Connecticut transportation chief, Marie, pointed to a private Australian investment firm”™s ownership of the Chicago Skyway, a deal that brings that city $2 million in annual revenue. Another Australian company owns the Indiana Toll Road and pays that state $4 billion a year, he said.
“I think that the idea of monetizing tolls to facilitate private ownership is going to come back with a huge flourish once the economy comes back,” said Marie. Government will become “very entrepreneurial” to finance its infrastructure needs “and public-private partnership is going to be a big part of that.”
No pain, no gain
The nation, said Patrick Quinn, president of U.S. Xpress Enterprises Inc., needs “to find the will to invest in a major reconstructive surgery” on its infrastructure. “Mostly that is political will,” he said. Without that costly surgery, the current $87 billion annual bill for congestion-related transport costs nationwide could rise to $1 trillion annually, he said.
“It”™s a tough issue because it involves raising money and it probably involves raising taxes and people don”™t like to talk about that,” Quinn said. “We have to get some political will, some political capital being spent on this issue. I”™m not sure how we get there.”
In New York, the consequences of leaving the Tappan Zee and other infrastructure unfixed “would be inevitable and catastrophic,” said Assemblyman Richard Brodsky. To fix the problem, the state can raise revenue through user fees or general taxes. “There is no political appetite in the state to do either one,” Brodsky said, resulting in “paralysis.”
Brodsky said the crisis is prolonged by the public”™s contempt of Albany lawmakers and opposition to higher taxes and fees, such as the business sector”™s continuing effort to overturn the year-old Metropolitan Transportation Authority payroll tax. “The conflation of, ”˜You”™re all incompetent”™ with ”˜I can”™t afford it”™ is what”™s at the heart of the crisis we face,” he said.
“I”™m willing to vote for taxes and toll increases to fund infrastructure,” the Westchester assemblyman said. “If that is what you want, then don”™t hit me over the head with a stick when we do it.”
The construction industry”™s Ruane said political leadership that starts with President Obama is needed to move the country into infrastructure planning and spending. “We gotta take on some pain or we will not solve this problem,” he said.
