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February 2008

Rail News: Rail Industry Trends

The National Surface Transportation Policy and Revenue Study Commission's 'action' plan


How’s this for a daunting task? Examine the condition and operation of the U.S. surface transportation system and develop a plan — with specific recommendations — to ensure the system meets the nation’s future needs. It’s a challenge the 12-member National Surface Transportation Policy and Revenue Study Commission attempted to meet last month when it released its report, “Transportation for Tomorrow.”

Created under SAFETEA-LU to address the country’s deteriorating transportation infrastructure, the commission spent the past 22 months conducting field hearings, listening to briefings from transportation experts and developing recommendations.

Their conclusion? Increase investment in surface transportation to the tune of $225 billion to $340 billion annually during the next 50 years. Transition away from the current gas tax to a vehicle miles traveled tax by 2025 to spur investment funding. And in the interim, raise the motor fuel tax by five to eight cents annually for the next five years, implement a freight fee and ticket tax for transit users, and contribute a portion of the customs fee to the trust fund.

In addition, the report recommends replacing the more than 100 current transportation programs with 10 performance-oriented, modally neutral programs to focus on projects of national interest.

“The transportation systems are aging. We need a tremendous amount of investment to maintain them and they are bursting at the seams,” said Commission Vice Chairman Jack Schenendorf, of council for Covington & Burling, at a Jan. 15 press conference. “We are not going to be able to handle the additional 120 million people forecasted over the next 50 years, or the enormous increase in freight.”

The commission proposes implementing a congestion relief program in the country’s largest metropolitan areas by expanding transit services and adding highway capacity; an intercity passenger-rail program that calls for creating “world-class” corridors connecting cities 300 to 500 miles apart; and a freight transportation program to implement highway, rail and other improvements to eliminate chokepoints and increase throughput, and provide public investment for key high-cost transportation infrastructure.

“You can’t solve the problem without having intercity passenger rail, high-speed rail, first-rate mass transit systems and more highway capacity to go with it,” said Schenendorf. “They can’t be pitted against each other.”

For the most part, the transit and freight-rail communities laud the recommendations.

“In calling for an expanded role for public transportation, the majority report addresses the need to provide Americans with transportation choices,” said American Public Transportation Association President William Millar in a prepared statement.

The report also “very clearly sets out the need for a robust freight-rail industry, and recognizes the opportunity for freight railroads to play a major role in alleviating traffic congestion, increasing highway safety, reducing pollution and saving energy,” said Association of American Railroads President and Chief Executive Officer Edward Hamberger.

The opposing view
But some congressmen and even a few commissioners voiced opposition to some aspects of the report — in particular, to the recommended funding mechanisms. Commission Chairman and U.S. Department of Transportation Secretary Mary Peters, as well as commissioners Maria Cino, former deputy secretary of transportation, and Rick Geddes, director of Undergraduate Studies for Cornell University’s Department of Policy Analysis and Management, formed a separate minority report.

The minority commissioners don’t endorse the group’s call for “substantial gas tax hikes, a new federal bureaucracy to centralize transportation decision making, new limitations on states’ abilities to attract private sector investments and a federal tax on all public transportation and intercity passenger-rail tickets,” according to a Jan. 15 press release.
“A better way forward is to provide incentives to states willing to pursue more efficient approaches and to invest federal funds more effectively to give commuters real relief from gridlock,” Peters said.

Rep. John Mica (R-FL), Republican leader of the House Transportation and Infrastructure Committee, also opposed the gas tax increase.

“What’s needed is a means of reliably raising revenue as we transition from gasoline to other transportation fuels to power vehicles,” he said.


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