Tag Archives: transit funding

Why Are There No Shovel-Ready Projects?

A recent Bloomberg article raises questions about the ability of the Trump Administration to execute a big infrastructure plan due to a lack of shovel-ready projects. Personally, my doubts are at a higher level: Republicans are riven by division on whether they should back an infrastructure plan at all, and Trump is destroying any chance he had to win Democratic votes by spending all his political capital on racist immigration policies that are hugely unpopular with the Democratic base.

However, perhaps it’s an interesting question why there are few shovel-ready projects. While conventional wisdom holds that environmental review prevents the US from doing big infrastructure projects, other developed nations in Europe and Asia seem to get things done, and one presumes they have established environmental laws as well. Projects can get held up for years by lawsuits on the adequacy of environmental studies, but the federal and state governments can always exempt projects from environmental review if they want to anyway.

Some more realistic causes are as follows:

  • Design takes time. A large project will be in design for over a year before construction can start. I recently worked on a moderately complex project where we were in design for 18 months before construction started, and that was rushed. You can throw more resources at design, but at some point this is to little avail, since the constraints become things like allowing the owner time to review submittals and providing adequate time for coordination between design disciplines. If you add in 6-12 months for the government to pass a funding bill, and 12 months or so for environmental review, it is pretty easy to see how you could not make it to construction before the sun sets on the political administration that came up with the infrastructure plan.
  • An obvious follow-up question is why it should matter if the political administration changes. I’m not sure how this compares with other countries, but different administrations in the US often have very different priorities. A Republican administration may cancel plans for transit projects that have not yet made it very far into construction, such as ARC in New Jersey. A Democratic administration may not be interested in continuing plans to build rural freeways that generate little economic activity. In some cases, such as some FTA funding, you’re not allowed to finish the design until you have funding identified for construction and operations, which means the design won’t be done when the infrastructure funding plan comes along.
  • It’s hard to just complete a design, put it on the shelf, and dust it off when the funding shows up. Depending on how long it’s been, the design may be out of date and no longer comply with current design standards and codes. The existing conditions in the field may have changed, necessitating new survey and redesign. The environmental permitting may expire and require a new analysis.

In other words, the political time frame is often too short to accomplish a large project. The long delay in completing the Bay Bridge East Span replacement, the example cited in the Bloomberg article, was almost entirely due to the political machinations of two mayors (Willie Brown and Jerry Brown) and two governors (Pete Wilson and Arnold Schwarzenegger). Caltrans’ original proposal, derided as a freeway on stilts, could have been completed decades sooner and at lower cost, had anyone cared to build it.

This is actually a strength of the self-help measures passed by voters in California counties, such as LA’s Measure R or Orange County’s Measure M2. These measures frequently set the agenda of projects or types of projects to be delivered, and provide a rough timeline for implementation, on a long enough horizon that there is continuity through election cycles.

All of that said, the United States has fairly well-developed existing infrastructure that needs a lot of upkeep. Routine maintenance work, such as resurfacing roads, rebuilding sidewalks, and replacing water lines, is usually exempt from environmental review and requires minimal design work. I think a lot of people in LA would appreciate a program that focused on resurfacing streets in poor condition and repairing broken sidewalks.

At a national level, it is going to continue to be a struggle to deliver large projects if the planning horizon never extends beyond the next election. But there’s a lot of basic maintenance we could be doing as well – things that are plenty shovel-ready, if you want to build them.

What Kind of Transportation Will LA Need in 2066?

(Note: as a civil engineer, I obviously have a self-interest in infrastructure financing.)

An opinion piece in today’s LA Times wonders if LA Metro’s proposed ballot initiative to fund mass transit, road, bike, and pedestrian improvements will soon be obsolete due to changes like driverless cars, hyperloop, and self-contained communities.

With the usual caveat that anything is possible and predicting the future is hard, I think this is pretty unlikely. Assuming the projects are well-executed, LA Metro’s plan will prove to be a beneficial investment in the region’s infrastructure.

As far as innovation in transportation goes, remember that transportation is a well-established industry. The major modes of transportation we use were developed decades ago: railroads in the mid 1800s, bicycles in the late 1800s, cars in the early 1900s, and airplanes in the mid 1900s. The last truly revolutionary changes in transportation were what – the jet engine for commercial air travel and containerization for freight? It’s possible a new technology like hyperloop will be developed and come to market; however, as currently conceived, hyperloop is a low-capacity luxury intercity service, not a solution for local mobility in cities.

Autonomous vehicles (AVs) should probably be analyzed in the same way. They are an incremental improvement on long-standing technology, not a new type of transportation. At this point, the theorized increases in highway capacity and reductions in car ownership are just that: theoretical. Trains and airplanes, which operate in much more controlled environments, don’t follow each other so closely that crashes are inevitable if something goes wrong, which is an underlying assumption of achieving major capacity increases with AVs. They will be great for safety, but the number of fatalities per billion miles traveled has fallen from over 200 in the 1920s to less than 20 today, thanks to things like better mechanical engineering for cars and better civil engineering for roads. AVs aren’t a revolution in safety; they’re just finishing a job that’s over 90% done. And if AVs do reduce the cost of driving, they may increase car ownership rather than decrease it.

Self-contained communities are also unlikely, because they buck the pattern of how people use cities. As cities grow, they can serve an increasing diversity and specialization of interests, and accessing them requires good transportation across the region. For example, let’s say you work in finance, which concentrates in downtown LA. You’re going to want to live somewhere convenient to downtown, as will most of your coworkers. However, you might really like Chinese food, and want to live in the San Gabriel Valley, while one of your coworkers might really like the beach and want to live in Santa Monica. Your partner might work in a logistics park in Ontario, and might really like the food in Little Saigon in Orange County. People and businesses distribute themselves around the region on different patterns. You can only take advantage of everything the city offers if you can easily travel around it. Logistics improvements like same-day delivery just invert the trip; instead of you traveling to the amenity, the amenity travels to you. Telecommuting will work well for a small set of people, poorly for a larger set of people, and not at all for an even larger group.

The transportation we need in 2016 is not very different from what we needed in 1966; in fact, the transportation we need in 2016 is not even all that different from what we needed in 1916, when rapid transit lines and electric railways were proliferating, and the first controlled access roadways were less than a decade away. SoCal is going to keep growing, and we’re going to need to fix our roads, expand transit, and improve bike and ped facilities. The LA Metro ballot initiative is something we can do today to help meet these needs for decades to come, and anyone who cares about the future of LA should strongly consider supporting it, rather than hoping for technological silver bullets to solve our transportation problems.

Mini-Case Study on Mega-Project Management

When people think about mega-projects in Boston, the Big Dig, along with its enormous cost overruns and construction quality issues, is what comes to mind. But there’s another Boston mega-project that started at about the same time, and didn’t become an archetype for infrastructure incompetence: the Boston Harbor clean up.

In the 1980s, due to decades of pollution from poorly-treated sewage and combined sewer overflows, Boston Harbor was a stinking embarrassment. A lawsuit under the Clean Water Act resulted in the state being forced to improve stormwater and sewage treatment systems so that water quality in the harbor would recover. It’s a little surprising that there doesn’t seem to be a detailed study comparing the two projects; because both projects were constructed at about the same time in the same city, there should be less issue correcting for exogenous factors like legal precedents, quality of local contractors and engineering consultants, and political institutions.

However, a trio of articles from the fall of 2006 offers some insight. A short article in Governing cites three major factors: continuity of oversight leadership, local funding, and in-house talent at the Massachusetts Water Resources Authority (MWRA), the agency created in 1985 to oversee construction and operations of the sewer treatment system. Continuity of leadership came in the form of oversight from the same federal judge and several long-serving MWRA board members, while the use of local funds for construction created an external incentive to control costs. Inside the MWRA, a small team of talented engineers oversaw the contractors and consultants, providing strong owner representation.

In a Commonwealth Magazine expert panel on the Big Dig, Douglas McDonald, who served as Executive Director of the MWRA for nine years, cites the MWRA board of directors as the critical difference between the two projects. According to McDonald, the Executive Director had to report to the board of directors and a community advisory board every month, answering questions in real time. In contrast, leadership at the Massachusetts Turnpike Authority, which managed the Big Dig, saw more frequent turnover and political interference. McDonald says that “it’s not totally clear to whom the Bechtel corporation [which oversaw the Big Dig] ever reported.”

Lastly, in a long-form article looking at the mismanagement of the Big Dig, Boston Magazine cites the high level of in-house talent at the MWRA as the critical factor. The article quotes David Luberoff of Harvard’s JFK School of Government saying “it’s clear the state needed to have someone with Bechtel’s expertise, but the state could have done a better job of managing the managers. You have to have a small, highly skilled, highly respected group of people who could look over Bechtel’s shoulders.” In other words, a project as unique as the Big Dig is always going to be beyond the capabilities of the managing public agency, and there’s nothing inherently wrong about using outside consultants. However, strong advocacy on the owner’s part is still required.

The article goes on to quote Paul Levy, another former MWRA director, saying that “we had a 50-person project management team within the MWRA of highly paid, very experienced people… right after I hired Dick Fox, I remember [Big Dig architect and former Secretary of Transportation] Fred Salvucci calling to congratulate me, saying he wished he could do that but it was not possible under the state personnel system.” Thus, it appears that a political decision – subjecting the DOT to the state’s personnel system but exempting the MWRA – made it more difficult for the Big Dig to hire people with the skills required to oversee the project. The inability to pay wages that are competitive with the private sector is a pervasive problem for public agencies.

Readers with experience in private land development will not be surprised by any of this. As a land developer, you need to hire a team of consultants to successfully complete a large project, including legal professionals, civil engineers, architects, mechanical-electrical-plumbing consultants, structural engineers, construction contractors, and construction managers. While they are all on your payroll, they all have other interests as well, which may conflict with your priorities. Architects will select more elaborate designs and finishes, both out of professional pride and the desire to have future clients see a portfolio of high-quality work. Civil engineers don’t want to aggravate the public agencies they interact with for other projects. Construction managers don’t want the contractor community to see them as too adversarial. Contractors might be losing money on another project and looking to make up that loss on other jobs. As an owner, you must strongly advocate for your interests and priorities. If you’re asleep at the switch, you’ll end up paying too much for the job, even if the entire project team is working ethically and there are no serious issues.

The harbor cleanup project was not without issue. For example, in 1999, two workers died near the end of the project’s nine-mile long tunnel due to a failure of the improvised breathing systems that they were using. However, the project was successful in its water quality goals; today you can swim at Spectacle Island, something that would have been unthinkable in the 1980s. The MWRA seems to be one of the more respected state agencies.

Meanwhile, the problems with the Big Dig have poisoned the public debate on transportation mega-projects. People now expect that the projects will be poorly built and have massive cost overruns, which makes it much more difficult to build political support. Progressives that think cost effectiveness and public trust don’t matter, take note.

Should Streetcar Skeptics Stick a Sock In It?

Ok, to be fair, that’s not what Dave Alpert said in his Citylab piece today, but once I thought of that title, I couldn’t resist.

The article says that mixed-traffic streetcar skeptics shouldn’t be so quick to denounce the projects – “don’t let the perfect be the enemy of the good” – for five reasons: imperfect transit can still be good, limited funding makes the perfect unachievable, funding won’t get redirected towards better projects, streetcars have higher capacity than buses, and improvements can always be made in the future.

There are some larger things in play here, but first, let’s take a look at the idea of imperfect projects in general, and the five reasons offered.

An Imperfect Project Isn’t Necessarily Good

No transit project is perfect. For example, consider LA’s Expo Line. In my humble opinion, some of the stops weren’t needed – Farmdale and perhaps Expo Park/USC. All riders would agree that the Flower Street Crawl, as we call the unacceptably slow portion of the line from Jefferson/USC to the Blue Line Junction, needs improvements to make it run faster. And penny-pinching value engineers can find plenty to gripe about, like the use of low-profile catenary, the unnecessary lights mounted on OCS poles, or four-quadrant highway crossing gates with four independent pedestrian gates.

Yet on the balance, the Expo Line is still a really good project. It provides a transit service that is competitive with the freeway and arterial road alternatives, and connects several existing dense nodes of development. The Expo Line and Blue Line have some of the best new LRT ridership in the country, despite an appalling lack of upzoning.

The proposed downtown LA streetcar, on the other hand, is a very weak project, regardless of mode. It’s a one-way loop that partly duplicates existing services that are far superior. Even if it were completely grade separated, it wouldn’t be any better than underutilized downtown people movers in places like Detroit and Miami. Opposition to the streetcar isn’t just based on it being mixed-traffic, it’s that even a technically perfect project on that corridor would not be a good project from a transit planning perspective.

In general, streetcar proponents seem to discount the idea that streetcars could be bad for transit, but that possibility must be considered. A project that requires heavy operating subsidies can drain service away from other transit, like buses. Many transit advocates in Austin point to the heavily subsidized Red Line rail for causing cuts to bus service, and fear that a poorly planned Project Connect will make things worse. Even LA’s rail transit projects, which perform very well on ridership, come under fire from bus advocates like the Bus Riders’ Union, which alleges that transit dependent populations have lost bus service in order to fund rail. If you’ve ever ridden a full 204 bus down Vermont in the evening, when it’s running 20 minute headways, and transferred to a relatively uncrowded Expo Line running 10 minute headways, you can see where that perception comes from.

If you build projects that make existing transit services worse, you run the risk of losing riders, and alienating part of the political base that supports transit.

Increasing Urban Development

The Citylab post suggests an imperfect streetcar might be acceptable as a way to increase the supply of walkable, urban places, but this is not a good reason to build a transit project. If there is desire for urban neighborhoods, they will be built if zoning allows for it. Upzoning along the Expo Line would likely lead to a boom in dense residential construction on LA’s Westside, but that development would happen with upzoning even if the train wasn’t there. Where development does follow streetcars, like Portland’s Pearl District, it has been awarded large tax subsidies.

Funding is Limited

Federal funding for transit is scarce. Metropolitan regions compete with each other, and within each region, there are competing projects. This results in reductions to project scope, to try to be able to build the project for less money, or in phasing projects, to spread out costs over time as funding becomes available. For example, the Purple Line to Westwood would be better off being built as one contract, in one phase, avoiding the need to issue multiple procurement packages and the cost of mobilizing and demobilizing several times. However, Measure R funds aren’t available fast enough, so the project is split into three phases.

On the other hand, the project needs to be big enough and useful enough to make sense as a standalone job. You couldn’t build a suspension bridge with only one tower, and you probably wouldn’t build a mile of Purple Line tunnel with no stations just because that’s all you had funding for. If you can’t meet a minimum threshold of utility, you’re better off not building the project.

Funding Won’t Get Redistributed to Better Projects

This is misdirection. It’s certainly true that, due to political constraints, money can’t be shifted easily to better projects. However, that doesn’t answer the question of the usefulness of the project at hand. As Alpert points out, it’s possible that the WMATA Silver Line money could have been spent on better projects, but the Silver Line is a good project on its own. Likewise, the Westside Subway is logically the highest priority subway in LA, but the Red Line to North Hollywood got built first because of political reasons. Fortunately, the Red Line is still an incredibly useful project on its own merits.

Streetcar Capacity

Streetcar proponents often point out that streetcars have higher capacity, and therefore theoretically lower operating costs, than buses. This is only true if you’re serving a high-demand corridor, where using streetcars would allow you to save a lot of money on driver labor. Streetcar routes that are running service every 15 minutes, or even less frequently, are clearly not at the point where bus capacity is saturated. This is a guess, but I think if you have hit the point where mixed-traffic buses are inadequate to serve the demand, or where rail would offer significant operations savings, you’re probably at the point where you need exclusive lanes as well.

Future Improvements

The prospect of future improvements is a legitimate reason for accepting an imperfect project, so long as the project is set up to enable those improvements. Alpert uses single-tracking a rail line and shorter platforms as examples, and they’re good ones. LA’s Blue Line was also built with two-car platforms, later extended to three cars to accommodate high ridership.

The challenge with mixed-traffic streetcars, especially if they’re curb-running, is that they don’t easily lend themselves to future improvements. Converting curb lanes to exclusive lanes is more difficult than converting center lanes because of drainage issues, parking, and driveways. The latter, in particular, can make it difficult to extend a sidewalk platform to accommodate longer vehicles in a dense urban environment. Short downtown lines are often pitched as “starter lines”, but long lines are not workable at the speeds achieved by curb-running mixed-traffic streetcars.


There are, of course, more than enough highway boondoggles to put things in context. You could also compare streetcars to, say, Essential Air Service subsidies, which blow millions of dollars subsidizing air travel to small cities across the country. Those are good points, but public opinion is remarkably adept at compartmentalizing government waste. Rob Ford can blast city councilors for getting free zoo passes, then turn around and propose wasting billions on converting Scarborough RT to a subway. Again, projects have to be worth it on their own merits, rather than being excused by something worse.

Note that none of this should be taken to mean that streetcars are always a bad idea. The Columbia Pike project is frequently cited by streetcar proponents, and it has the potential to be a good project. For starters, it’s a straight, logical route, and they’re proposing to run 6 minute headways, which suggests existing transit demand is high enough that rail might be cost effective for operations. If it were center-running, it would offer the potential for future improvements that might lead some technically inclined observers to support it.

The Big Picture

In the big picture, the streetcar debate is part of the ongoing rift between what Alon Levy called politicals and technicals. Progressive political activists are inclined to view any expansion of rail transit services as a positive, building towards a future where there is more political support for transit expansion. Technical commenters are inclined to believe that you can only build so many bad projects before the people realize their money is being wasted.

This blog is LA-centric and written from an engineering perspective, naturally tending toward the technical side. Simply put, if the Blue Line and Red Line were running empty trains all day long, I do not think we would be building the Expo Line and Purple Line. While I understand the need to build political constituencies to support policy changes, I also think nothing succeeds like success. LA voters are demanding an expansion of rail transit services, while residents of greater Portland are pushing back against further expansions of streetcar and LRT service, putting higher priority on more frequent bus service.

Alpert’s piece concludes with a warning that “writers who think more transit is good for cities should bear in mind that not all readers necessarily agree with that basic premise”, referring to opponents who don’t want to fund transit at all. This statement is similar to Robert Cruickshank arguing that because some ideological transit opponents use efficiency as a false flag attack, progressives should actively shun the idea that efficiency matters.

Well, guess what – I don’t think more transit is necessarily good for cities! Resources are limited. Transit that is grossly inefficient, or wastes capital dollars, is not good for cities. This is a fundamental failure of allies for good transit projects to understand where their fellow advocates are coming from. But as frustrating as it may be at times, we ultimately need each other’s support. Political advocates need to learn what projects will gain long-term support by providing useful services, and technical advocates need to figure out how to improve public understanding of what makes transit useful.

And if the project is just to support condo developers, well, let them build it.

Components of Highway Funding Shortfalls

I forget where, but I recently heard another story about highway funding that specifically mentioned declining vehicle miles traveled (VMT) and increasing fuel efficiency as causing reductions in gas tax revenues. The impact of inflation on the purchasing power of gas tax revenues was mentioned only in passing (to note that the federal gas tax has not been increased since 1993).

The VMT and fuel efficiency trends are real, but are they the main show? Well, we have data! So here’s a look at trying to tease out the impacts of decreasing VMT, increasing fuel efficiency, and inflation on transportation funding at the federal level.

Warning: all of the calculations here are very rough. There are many variables involved that are beyond the scope of this post. A detailed study would probably be a good project for a grad student somewhere. As it is, take the results here as indicative of the order of magnitude of impacts.

Detailed methodology is explained at the bottom of the post.

The federal gas tax was last raised in 1993, to 18.4 cents per gallon. Since that time, inflation has eroded the purchasing power of the gas tax (i.e. the same amount of money now buys less roads). In addition, in recent years there has been a notable increase in fuel efficiency, and a stagnation of VMT. Because people are driving more fuel efficient vehicles, and driving them fewer miles, the amount of gas used is going down, and so are fuel revenues.

To figure out the impact of each factor, we need to look at data trends over the last 20 years and pose some reasonable counterfactuals. For data, I pulled VMT from the St Louis Fed’s FRED service, inflation from the BLS Inflation Calculator, and fuel efficiency from the EPA’s Fuel Economy Trends Report. For counterfactuals, I looked at the following scenarios:

  • VMT growing at a constant 2.33%/year, the approximate rate at which it grew from 1993 to 2005.
  • Gas tax being adjusted annually to account for inflation.
  • Vehicle fuel efficiency held constant at 1993 level.
  • Combination of all three factors.

Trends since 1993 are shown in the following graph:

yearly revenue loss

Logically, the loss of purchasing power due to inflation has an immediate and increasing effect, tempered by slower inflation in recent years. The emergence of VMT and fuel efficiency as significant factors in revenue losses is relatively recent, within the last 5 years.

The next graph shows cumulative losses to transportation funding since 1993:

cumulative revenue loss

The reason to look at cumulative losses is that transportation funding is usually authorized as multi-year bills, and surpluses (or deficits) to the highway trust fund roll over from year to year. The loss of purchasing power due to inflation dominates; change in VMT trends only recently emerges as a relatively minor factor. Changes in fuel efficiency have had basically zero effect on the long-term solvency of the fund, as recent gains in fuel efficiency have just barely offset losses in fuel efficiency in the late 1990s and early 2000s.

While these are only order of magnitude results, they show pretty clearly that inflation has been the most important factor. It is beyond the scope of this post to argue if additional federal transportation funding is needed, but if it is, raising the gas tax is the easiest and most effective way to do it. (Note that theoretically, declining revenues due to declining VMT isn’t even a problem in the first place, since less driving means less roads are needed. And due to climate change, trends that result in higher fuel efficiency and lower VMT are net positives for society.)

So why so much talk about declining VMT and fuel efficiency? Wild guesses: first, it’s a convenient narrative if you want to replace the gas tax with a VMT tax and/or tolls. Second, it makes the problem seem more complicated, which creates the opportunity for Serious People™ to opine. And lastly, it provides a scrap of cover to incompetent politicians who would look like dunces if everyone realized that the problem could be solved by a 25-word piece of legislation raising the tax and indexing it to inflation.


A detailed assessment of the impact of inflation, VMT, and fuel efficiency trends on gas tax revenues is beyond the scope of this post, which is intended to determine orders of magnitude. Data was processed as follows.

VMT data was pulled from the St Louis Federal Reserve Bank’s FRED service. I used the January data point for the moving 12-month average for each year from 1993 to 2014. VMT trends started changing in 2005, so I calculated the annual rate of change from 1993 to 2005 as about 2.33%, then projected a VMT trend from 1993 to 2014 at that rate. The impact of VMT trends was calculated as a function of the difference between actual VMT and “implied VMT” calculated at 2.33% growth per year.

Inflation data was pulled from the BLS’s CPI calculator. I calculated the tax rate for each year from 1994 to 2014 that would yield the same purchasing power as 18.4 cents in 1993. The impact of inflation was calculated as the difference between revenue that would have been collected if the tax had been adjusted for inflation every year and revenue that was collected at 18.4 cents per gallon. This methodology probably systematically underestimates the impact of inflation, since costs of construction materials increased more quickly than general CPI between 2000 and 2007.

Fuel efficiency data was pulled from the EPA’s Fuel Economy Trends Report. This data provides fuel efficiency for vehicles by model year, not for the actual composition of the US vehicle fleet. Therefore, it can’t be used directly because that would overestimate the impact – model year 2014 cars are more efficient, but most cars on the road are older. I generated a crude fleet MPG by summing the product of model year fuel efficiencies and an approximation of vehicle fleet composition by age.

I then calculated assumed revenue amounts for each year as follows (where T = tax rate):

  • Actual revenue for each year: R = T(VMT/MPG).
  • Implied revenue assuming VMT continued to grow at 2.33%, and the gas tax was adjusted yearly for inflation, and no gains in fuel efficiency: S =T’ (VMT’/MPG’).
  • Implied revenue assuming actual VMT trends, but gas tax adjusted yearly for inflation and no gains in fuel efficiency: W = T’(VMT/MPG’)
  • Implied revenue assuming the actual gas tax (i.e. unchanged), but VMT continued to grow at 2.33% and no gains in fuel efficiency: X = T(VMT’/MPG’)
  • Implied revenue assuming actual gains in fuel efficiency, but VMT continued to grow at 2.33% and gas tax adjusted yearly for inflation: Y = T’(VMT’/MPG)

As a point of reference, the world’s finest information source says that the federal gas tax raised $25b in 2006. The methodology here generates an estimate of $27.4b. Good enough.

The revenue losses due to each factor were then calculated as the difference between the theoretical revenue with all historic trends (S) and the theoretical revenue with actual trends for each factor (W, X, Y):

  • Total revenue loss = S – R
  • Revenue loss from VMT trends = S – W
  • Revenue loss from inflation = S – X
  • Revenue loss from fuel efficiency = S – Y

Note that the total revenue loss does not equal the sum of the components, i.e. (S-R) ≠(S-W) + (S-X) + (S-Y). This is because the factors are not independent. For example, if fuel efficiency goes up, the revenue lost from a decline in VMT will go down, because the missing VMT represents a smaller amount of gas. This is why the three factor lines on the graphs do not sum to the total.

Transit Costs: OCS Edition

Last weekend, I tweeted a few photos of Expo Line Phase 2 overhead contact system (OCS) construction. The OCS is part of the traction electrification system (TES) that provides electricity to trains, and includes the poles, cantilevers, wires, and associated hardware that you see along the track. The other part of the TES is the traction power system (TPS) which consists of electrical substations along the tracks, the cables that connect the substations to the OCS, and the rails, which serve as the negative return.

In this post, we’ll explore some OCS choices that can impact the cost of a light rail project. The OCS is something you have to build, and it’s not going to be the thing that breaks the bank. Nevertheless, a million here, a million there is still real money, right? In the same way that Jarrett Walker describes the choices between frequency and coverage, I’m going to take the soft approach and tell you that none of these options are really wrong, but you need to have an honest and open discussion about the cost implications. A good engineer should provide the owner with an understanding of the options available and the implications of each, and faithfully execute the design as efficiently as possible, but the ultimate design direction is made by the owner.

The discussion here is geared towards DC electrification, which is used for most light rail systems. Intercity rail is electrified with AC; the concepts are the same, but the greater working clearances required for higher voltages will result in some different decisions (e.g. side poles instead of center poles).

System Type and Height: Normal Profile Simple Catenary, Low Profile Simple Catenary, or Single Wire?

Simple catenary refers to the system you see on most of the Expo Line, Blue Line, Gold Line, and Green Lines. This system has two wires, called the messenger wire and contact wire. The messenger wire is the upper wire and is more visibly parabola-shaped than the contact wire, which, as the name suggests, is the wire the train’s pantograph touches. The system height refers to the vertical distance between the messenger wire and the contact wire at the poles.

A normal profile simple catenary system might have a system height of 4’. This lets you maximize the distance between poles (the span length) based on other factors like wind loading and track curvature, without worrying about maintaining separation between the messenger wire and the contact wire. So why aren’t all systems normal profile simple catenary? Because people have decided they’re visually unappealing.

A normal profile simple catenary system takes up a lot of your field of vision and has long hangers connecting the messenger wire to the contact wire. To reduce the visual impact, you can use low profile simple catenary. This has a lower system height – say 2’. This reduces the visual impact of the wires, but because the messenger wire and contact wire start out closer at the poles, they’ll get close to each other sooner, and you can’t space the poles as far apart.

Thank goodness the OCS doesn’t block too much of the view of the LADWP power lines on the other side of the tracks, right?

As an example of pole spacing, here’s a straightaway on normal profile OCS on the Blue Line with poles at 180’, and one on the Green Line with poles at 220’. Meanwhile, the straightaways on the Expo Line’s low profile OCS max out at about 140’.

The main impact here as far as cost goes is that you need more poles, and pole foundations. As you can see, the comparison between the Green Line and Expo Line suggests a low profile system will need three poles for every two poles on normal profile system. That’s too high, because curves will still need closer pole spacing, as will special track work like crossovers. Nevertheless, using a low profile system can result in a considerable increase in OCS costs. The engineer should be able to give a rough idea of the impact of changing the system height for the project. The owner must decide if it’s worth the cost.

Finally, there is the single wire system. This is often the most preferred system by politicians and city boosters because it results in the fewest wires in the sky.

Naturally, single wire is also often the most expensive. The pole spacing is reduced because without the messenger wire, you need more supports to keep the contact wire on an acceptable profile. However, the hidden costs of single wire systems are worse. With only one wire in the air carrying current, there is not enough ampacity (ability to carry electricity) in the system. To avoid the need for additional substations, power must be supplied to the contact wire at shorter intervals, and this is done with electrical feeders in underground duct banks. This can add significant costs.

Single wire systems are most suitable for low speed services in touristy areas, which is why you often see them for streetcars. They’re also suitable for tunnels and other places with constrained vertical clearances, where the cost of feeder cables and additional supports is less than the cost of increasing the vertical clearance to accommodate a simple catenary system.

Poles: Wide-Flange, Tubular, or Ornamental?

This is again strictly an aesthetic decision. Wide-flange poles are, as the name suggests, wide-flange steel beams, the kind you can practically order off the shelf. That makes them cheap, because you just say you need so many W this by that members of lengths X, Y, and Z. They’re also very utilitarian and you rarely see them in urban contexts. Here they are in action on the Northeast Corridor, where it would be hard for anything to outdo the New Haven’s old rusty trusses with outside utility overbuild.

Tubular poles (or tapered tubular poles) are a little bit more pleasing to the eye, probably because they tend to look like the poles used on old systems. They’re a little more expensive, but not terribly: this Central Corridor document suggests that the costs to go from wide-flange to tubular poles for 5 miles of ROW was just $1m. Of course, if you have chosen a low-profile simple catenary, you’ll have more poles, and the cost will be greater.

Ornamental poles will cost you quite a bit more, like any custom design. Here are a couple examples, one in Australia and one in St Petersburg (the Leningrad one, not the one that had a Madame Tussaud Wax Museum from 1963 to 1989).

A couple of final points: wood poles are always an option; I’m not aware of any modern system that’s using them but they are cheap. Of course, they’ll probably wear out faster than steel poles. The built-up truss style poles you see on older systems are labor-intensive to manufacture, and standard wide-flange steel beams are widely available. If material costs for steel go up, maybe pre-fabricated truss poles like these ones in Australia will be more cost-effective. (The source page for that photo has other good photos of wide-flange poles too.)

Mixed Metals

Another potential costs savings in OCS design is using aluminum for the messenger wire instead of copper. Aluminum has a lower ampacity, which means you have to use a slightly larger gauge wire, but this is more than offset by the cheaper cost of aluminum. Aluminum conductors are sometimes used in building construction to save money; for example, the Staples Center used aluminum feeder cables. On the other hand, this paper (registration required) recommends the use of copper to avoid the need to connect different metals electrically, which can create a galvanic couple. This page from the Indian Railways Fan Club says that Indian Rail tried aluminum contact wires but this was unsuccessful due to oxidation and mechanical failures. I’m not sure why they tried aluminum for the contact wire; copper is definitely the way to go there.

My knowledge here is very limited, but I’ve heard that there are places outside the US that use aluminum for the messenger wire and copper for the contact wire. Certainly, this is an option worth considering if the price of copper stays as high as it has since it surged before the 2008 financial crisis.


The OCS is just a cost of doing business, and it’s usually not a large portion of the total costs. The big overruns come from unnecessary project elements, labor inefficiencies, differing site conditions and associated delays, change orders, and so on. But, while the cost of a house is mostly determined by the size of the house, a lot of little extravagances with the finishes can noticeably drive up the costs too. Do you really need marble floors in the bathroom?

As an engineer, I usually come down on the side of cost efficiency. If it was up to me, you’d get nothing but standard wide-flange poles and normal profile simple catenary. No one’s life is going to be measurably worse from having to look at those poles with two wires, and no one’s life is going to be measurably better by getting to look at an ornamental pole with one wire – certainly not in comparison to having or lacking access to good transit. At least, that’s my opinion. If your city decides it’s better to have fancier looking things, that’s your collective choice. Just have an open and honest discussion about the costs.

Why Does US Transit Cost So Much?

Why is the cost of building transit projects in the US anomalously high? Alon Levy has been doing yeoman’s work at this for a while, and in the last year or so it’s received attention from more prominent writers, like Stephen Smith of Market Urbanism and Matt Yglesias.

Step 1 is admitting you have a problem. So it’s important for people with a national platform to keep hammering away at increasing recognition of the issue. For the more technically inclined folks (read: academia and the blogosphere), the logical next step is trying to figure out why we have a problem.

In that spirit, here’s a first shot at enumerating the reasons, along with a brief description of each. Getting to the bottom of this problem is not going to be easy – it’s going to involve investigating each of these factors in detail. That means talking with people all over the world about how they approach, design, and construct transit projects, and breaking down where costs come from. But it’s something that needs to be done. As the federal government cuts its involvement, cities are increasingly relying on self-financing. Building more transit for less money is critical to making the projects worthwhile and building public trust. It has to be done.

Some of these are probably non-factors. Others probably make in difference in some places but not others. This is just a first attempt at identifying things to look at. Without further delay. . .

Lawyer Up

We pretty much have to start here, don’t we? Others have suggested that high costs are a feature of common law systems. Any major transit project in America is at risk of getting sued. The ridiculous California v. All Persons Interested case where the CAHSRA preemptively filed suit against, theoretically, the entire world pretty much sums it up. In addition, threat of lawsuit is going to be a common contributing factor in many of these potential reasons.

Lack of Agency In-House Talent

Back in the 50s and 60s, state DOTs did a lot of their highway engineering in-house – the iconic LA interchanges, the most advanced of their time, were done by Caltrans. Same goes for the privately operated railroads; in their heyday, they had big in-house engineering departments. Today, virtually all project management, design, and construction oversight is done by outside consultants, and consultant advocacy groups lobby government officials to keep it that way.

The use of outside consultants is not necessarily a bad thing. You could argue that it just reflects increasing economic specialization, and spares the agencies the need to hire people for a specific project and lay them off when the project is done. That’s especially true for things that agencies don’t do a lot or do consistently, like building transit projects.

The problem is that most agencies now have little in-house talent, so they may not know if their consultants are doing a good job or not. This is true from the bottom, where agency engineering positions pay less than outside consulting and consequently make it difficult to retain talented people, to the middle, where agency PMs are likewise paid too little, to the top, where some agencies are run by political appointees who don’t know enough about transportation.

Depending on your political persuasion, you might blame this on (a) government work rules that make it impossible to get rid of incompetent employees or (b) consistent underfunding that prevents agencies from offering pay that could compete with the private sector. Both are probably factors in varying degrees. Either way, the result is that you end up with. . .

Consultants Checking Consultants Checking. . .

The organizational structure of a major transportation project today probably goes something like this: the agency hires a program manager consultant to study the project and take the design to a preliminary level. The agency then hires another consultant (or a design-builder) to complete the design. That consultant’s work is checked by the program manager consultant or a third-party consultant that the agency has contracted for design review. When the project goes to construction, yet another consultant is hired as the construction manager, to oversee the contractor’s work.

Combined with sparse in-house resources, this creates the potential for wasting public money. To understand why, you need to consider consultant motivation.

Consultant Conflicts of Interest

Many people seem to assume that consultants are interested in getting projects accomplished as efficiently and cost-effectively as possible.

But what is the consultant’s motivation? Really, like any private firm, the motivation is to get paid as much money as possible for as little work as possible. If agencies don’t have the in-house talent to know what their consultants are doing, they might end up paying more than they should. This motivation goes right down to low level employees in consulting firms. Businesses have profitability goals, and that means consulting firm staff have billability targets – that is, they must charge a certain amount of their time to particular projects. Staff know that if they don’t hit their billability target, they’ll eventually get laid off, so their personal incentive is to charge projects as much as they need to in order to hit that target. Better to have a job and go ask the agency for more money than be out on the street, right?

Consulting firms also set up different teaming arrangements with each other on different projects to take advantage of differing specialties among firms. This creates a natural conflict of interest where Consultant A is reviewing Consultant B’s work on one project, but hoping to get on a team with Consultant B on another project. Engineering consulting is a small world, and you can’t afford to be on bad terms with other firms if you hope to team with them for other work. Contrast that with agency in-house review, which has no such conflicting incentive.

Consultant Liability

As anyone in private business knows, one of the fastest ways to lose money is to get hit with lawsuits. For example, if someone gets hit by a train at a grade crossing, they might sue the railroad, the engineering firm that designed the grade crossing, the contractor that built it, the manufacturer that made the equipment, or any combination thereof.

Public agencies often enjoy liability limits set by the state, but consultants don’t. If you work for a consultant and you propose something that doesn’t meet standards (MUTCD, AASHTO, AREMA, NFPA, whatever they may be), your boss may ask you something like “and what’s your answer going to be when you’re on the witness stand and the plaintiff’s lawyer asks you why you didn’t meet the standard?”

Again, think of the consultant’s motivation. If they design everything to standard and it costs extra money, it’s not their money that gets spent. If they design something that doesn’t meet standards, they potentially expose themselves to significant liability. What would you do? There’s a reason some consultants think the best project is the project that never gets built.

Interagency Graft

One of the most frustrating things about transportation projects is that they require coordination between many different government agencies. A transit project probably involves, at minimum, the regional agency responsible for building transit, city DPWs or DOTs, water & sewer districts, utilities, and perhaps a state transportation agency. Theoretically, these agencies are all part of the same team. In practice, agencies often operate as fiefdoms, each defending its own turf and trying to extract concessions from others.

For example, let’s say I’m the head of a DPW, and you’re the transit agency who’s going to build a surface running LRT. I’m years behind on my pavement resurfacing schedule, and the sidewalks on the street you want to run on are a disaster. Half the loop detectors at my traffic signals are broken and the controllers are 40 years old anyway. By rational accounting, your project should only owe me for the present value of my decrepit infrastructure. But guess what? You need a permit from me to work in my ROW. So it looks like you just bought yourself full depth reconstruction of my road and all new traffic signals.

We caught a glimpse of this recently when the cost estimate for the LA Streetcar doubled due to utility relocation, which opponents pounced on to question the project and proponents protested as unnecessary. Regardless of what you think of the project, it’s likely that utilities, both public and private, will try to squeeze as much new infrastructure out of the streetcar project as possible. OPM, dude.

Intra-agency Graft

Different departments within an agency might try to do the same thing. In most agencies, capital projects are a separate department from operations and maintenance. This can impact projects in two ways. First, as with interagency demands, the costs of backlogged maintenance can foisted onto the capital project. For example, the MBTA Green Line Extension is probably going to have to do work on the century-old Lechmere Viaduct, despite the fact that repair work was done only 10 years ago and the work isn’t necessary for the extension (other than that if the viaduct falls down, the extension will be useless).

Second, maintenance and operations departments might ask for capital infrastructure on the new project to make their lives easier. For example, the Red Line, Blue Line, and Gold Line don’t have crossovers between every station. But the Expo Line does. That makes maintenance work easier and facilitates single-tracking for operations, but are all those crossovers really necessary?

Make Hay While the Sun Shines

The old saying goes that politicians see about as far as the next election. It follows that transit agencies, which are often political entities, might have about the same planning frame. Also, because US politicians seem to lurch from crisis to crisis, throwing money at problems only when they become severe, agencies may operate in a feast or famine mode.

That means that when they have money, they are often anxious to spend it. In the absence of reliable long-term funding and planning – like, say, Measure R – the incentive is to spend the money before someone like Chris Christie or John Kasich gets elected and pulls the plug on the whole thing.

Preemptive Mitigation

The potential for lawsuits can induce preemptive mitigation measures for two reasons: first, if you give opponents enough, they might not sue you. Second, if they sue, you can show that you’ve made a good faith effort to reduce the impact of your project. Maybe you don’t really need four-quadrant gates and quiet zones; maybe it’s really not worth it to build retaining walls to save a few square feet of wetland. But you do it anyway to try to avoid potentially larger costs of lawsuits and delays.

Legally Mandated Mitigation

If you get sued, there’s always the possibility that the court could impose costly mitigation measures. For example, Metro had success in defending the Expo Line against lawsuits demanding grade separations at Farmdale, Overland, and Westwood. As it is, Metro was forced to build another surface level station at Farmdale (not cheap, but low impact in terms of price per mile) and got stuck with a nuisance speed restriction. But if those cases had gone the other way, the costs would have been much higher.

Union Rules

I don’t know much about union rules, but it’s been suggested elsewhere that unique characteristics of US unions & work rules result in very inefficient use of labor. Certainly, on the operations side, unions consistently oppose labor-saving reforms. Unions have probably also been conditioned to try to get as much work for their members as possible while the political winds are favorable.

Crappy Transit Activism

I don’t know anything about transit activism in countries outside the US. But there are people in the US that will defend transit projects no matter how poorly they are planned and/or executed. Alon Levy already wrote about this issue so I won’t go into more detail.

Coattail Riding

Lastly, huge public works projects are convenient places to tack on other desired improvements that might seem expensive in their own right, but aren’t that much relative to the big project. For example, the MBTA Green Line Extension project might end up building part of the Somerville Community Path, and the Expo Line Authority is building some of the Expo Corridor bike paths.

That’s not to say those are bad projects; I’m all for the Expo bike paths. But as a matter of accounting, that adds unrelated costs to the transit project.

Next Steps?

That’s about all I can think of for now. Again, this is just an attempt to identify potential causes for high US transit costs. Some may not be factors, some might be inconsequential factors, and no doubt I’ve forgotten others. If any transpo grad students out there are looking for research topics, feel free to take up a couple of them 😉

Update 3/12/14:

On Twitter, The Tysons Corner suggested that public cost estimates early in the process (conceptual design, preliminary engineering) set a floor for contractor bids. IMHO, that is a valid point – after all, the motivation for contractors is not to submit the lowest possible bid, but a bid $1 less than the second lowest bidder. You often hear contractors talk about how winning bidders “left money on the table” when there was a big spread between the lowest and second lowest bids. On the other side, engineers hate getting burned by costs coming in too high, so they’re motivated to inflate their estimates early on in the process. However, as long as these projects are being built by public agencies, the documents are public records, so I don’t see any way out of publishing some sort of cost number at each stage of design, and cost is obviously an important factor for the public to decide if the project is worthwhile.

Can Public Services Be Profitable?

Via Dennis Griffith, we have this detailed write-up discussing what type of good transit is (in economic terms). To summarize, goods can be private, common, club, or public. The differences lie in if the good is excludable and rivalrous. A good is excludable if its consumption by those who haven’t paid for it can be prevented. For example, flying is excludable because it’s easy to prevent unauthorized use of an airplane. Air is non-excludable because you can’t stop people from breathing. A good is rivalrous if one person’s use prevents another person from using it. For example, if I catch a fish, you can’t catch the same fish. But if I ride an uncongested bus, you can ride too, and our consumption of transit is not mutually detrimental. Here’s a summary of the four types of goods and examples of each.


In this framework, transportation facilities like rail lines and freeways are properly a club good if the facility is below capacity, and a private good if at capacity. Indeed, airlines and airports are operated as private goods, and in many parts of the world, railroads and freeways are as well. So it’s clear transportation can be profitable.

However, if you choose to provide transit as a public good – that is, you make it a social good – it doesn’t make sense to ask if it’s profitable. You can measure system performance by things like boardings per mile, mode share, and reliability. You can measure financial performance by things like cost per vehicle revenue mile or cost per passenger mile. But profitability doesn’t make sense – in fact, in the context of a public good, it’s meaningless.

Consider a police department. It collects little in the way of user fees, and the user fees it does collect (seizure of assets of drug lords) have a terrible incentive structure. Is the police department unprofitable? Should its services that do not result in lucrative property seizure be cut back? On the other hand, consider the Franchise Tax Board. It collects more revenue that it takes to operate. Is it profitable in any meaningful sense?

In other words, anything below the total revenues and total expenditures of the government is just a matter of accounting. A transit agency is just a part of the government to which we’ve assigned provision of certain services and collection of certain revenues. You pay some taxes for the service to exist, then you pay additional taxes (fares) to use it – no different than, say, national parks, for which we pay taxes in general and then pay additional entrance fees when we visit.

The difference is that the other things I’ve mentioned – police, revenue collection, parks – are more naturally public services than transportation, so you don’t think about them the same way. It’s clear from past US experience and current international practices that some transportation can be operated as private goods. I don’t have a problem with that model, but if we want to pursue it, some transit agency functions that would not be profitable will have to be reassigned to other agencies. For example, society has decided that disabled people ought to be able to get around, and transit agencies have been assigned that task. But there’s no reason it couldn’t be assigned to other agencies that provide health services. Those are the types of questions that have to be answered if we want to move toward privatizing some services.

I’m off into the realm of speculation here, but I think that if you expect privatization to solve many of our transportation problems, you’re going to be disappointed. The places in the world that have high quality private transportation – Japan, Spain, France – are also pretty competent at building and operating public infrastructure. Meanwhile, other than the freight railroads, the limited data we have on private rail and highways in the US is mixed. Commuter rail services operated by concession, like Metrolink or the MBCR, are not appreciably better than directly-operated services like LIRR or Metro North. Privately operated toll roads are sometimes unable to meet revenue expectations (the 73, the 241, and the 125 in CA, and the SR-130 in Texas); when they are successful (the 91) political pressure results in public takeover.

In other words, as is often the case, for both public and private entities, there’s no solution quite so good as basic competence.

Should We Worry About Highway Subsidies?

I touched on this issue way back when I wrote about the gas tax, but I’d like to expand the thought.

One of the most common criticisms of auto infrastructure from transit and smart growth activists is that drivers don’t pay the full cost of roads – the gas tax and other associated fees have not been increased enough to keep pace with spending new construction and backlogged maintenance. Much of the money spent on highways comes from property taxes, which you pay regardless of if or how much you drive. Counter to this, you have folks like Randal O’Toole, who note that no transit agency in the country covers even its operating costs with fare revenues, let alone capital costs. Transit agencies don’t pay property taxes, but they run buses over roads paid for by those taxes. In addition, the federal government and many states have dedicated part of their gas tax revenues to transit, meaning that drivers subsidize transit.

Still Not User Fees

As I said in my post on the gas tax, I don’t see how transit activists can win under the “user fee” framework. Some, like Cap’n Transit, claim that transit would make money if drivers were forced to pay the full cost of driving. However, given typical farebox recovery ratios on US transit systems (about 25%-50%), I don’t see how that could happen. Assuming farebox recovery is currently 50%, an agency would have to either double the number of people on each vehicle, double the amount of money extracted from each rider, cut unit operating costs in half, or some combination of the three. (Note that just doubling ridership doesn’t cut it if you have to run additional vehicles, since that costs money.)

Realistically, it seems to me that a scenario in which a transit agency has 100% farebox recovery is a scenario in which low ridership routes are eliminated, low ridership stops are eliminated, off-peak service is reduced, and peak service fares are higher. Now, maybe you’re fine with that scenario, but you should back up, read your Jarrett Walker, and ask yourself what you’re actually trying to do with your transit service. Are you ok balancing the transit agency’s books by raising fares on people too poor to afford cars? Are you ok with stranding people who live on low volume routes? Are you ok telling your city’s late-night crowd to suck it up and pay for a cab?

Generally, though, the agency is being asked to provide some minimal level of service to all parts of the region, for some minimum span of service, regardless of profitability. In that context, it’s not consistent to expect the agency to be profitable. There are also many benefits that accrue to society as a whole that the agency can’t capture – for example, if someone chooses to ride transit instead of driving, there are benefits to air quality from less congestion. In that sense, we aren’t “subsidizing” transit, we’re making an investment in the public domain that ought to produce future public benefits exceeding the cost.

And here’s the thing: many of the same arguments apply to roads.

For example, implementing tolls or increasing the gas tax is only progressive at the crudest level of analysis. In general, transit riders are poorer than drivers, but there is huge variability within drivers. Within the driving population, these taxes might be regressive, since wealthier drivers can afford to live closer to work. Like low volume transit routes, it is expensive per capita to provide arterial roadways to rural areas, but we’ve decided that in our society everyone deserves some base services. We also expect roads to produce benefits to society that aren’t directly captured by the government agency in charge of roads – for example, when rubber-tire internal-combustion trucks became available, there was a large reduction in the amount of horse poop lying in city streets. (The memories have faded, so we don’t often think of the horse poop benefits of trucks nowadays.)

Public Services Framework

In fact, both roads and transit could be considered public services like police and public schools, and we certainly don’t expect the police department or elementary schools to fund themselves entirely from user fees.

In that case, why charge drivers anything for road use (or why charge patrons anything to ride transit)? There are two reasons to charge for public goods:

  • Negative externalities (in this case, mostly air pollution and GHG emissions)
  • Overuse (in this case, congestion)

With this framework, the gas tax serves both purposes: it imposes a base usage fee that discourages people from driving for no reason, and it taxes people in proportion to the amount of pollution they create. The gas tax should probably be increased nationally because of the high costs of air pollution and GHG emissions. Some states or metro areas might consider a further increase as a base congestion charge. Managed toll lanes, like exist on the 91 and the 110, should be implemented on a larger scale to help deal with congestion during peak periods.

Another nice feature of this framework is that it’s perfectly logical to charge drivers more than it costs to maintain the road if demand is very high. The surplus can be used to fund other parts of the transportation system. For example, New York charges very high tolls on the Hudson River bridges and dedicates the surplus to transit operations. It’s also reasonable under this system to charge wealthy Acela patrons more than it costs to run those trains, and subsidize other services.

It always seems like a pretty cynical argument to me when I hear transit activists argue that “drivers should pay the full cost of roads”. Under a counterfactual where highway user fees generated more than enough money to cover maintenance of existing roads, would they be arguing that the rest of the fees should be used on roadway expansion capital projects? Of course not. Taking roads and transit to be public services results in a more consistent argument.

What About Overbuilding?

Part of the argument is that if drivers had to pay the full cost of roads, we’d build less roads. True, and valid if your preexisting goal is building less roads. By the same token, if transit riders had to pay the full cost of transit, we’d be building fewer trophy streetcars and suburban LRT lines.

Overinvestment and misallocation of resources is a classic problem of public services. Cities with useless streetcars are no different than rural towns whose police equip themselves with tanks or cities that say they’re going to supply every student with an iPad. In other words, there is no substitute for good governance. While you certainly could curtail some of the abuses by going to a user-fee system, remember the compromises that go with that. Other countries have shown that competent public governance is possible.

However, the more I think about it, the more I’m in favor of getting the federal government out of the capital projects side of things. Our mainline freeway and rail networks are complete, and the federal government seems to make a lot of poor investment choices now that most of the good capital projects are complete. There’s definitely an equity case for some federal involvement in helping out poor states and cities with operating costs and vehicle procurement, and the federal government should help states and cities out by using its low interest rate to borrow, but should the feds be involving themselves in things like Portland’s streetcar extension or the 69 freeway? Probably not.

Are Roads a Public Good?

You could make an internally consistent argument that drivers should pay the full cost of roads if you think that roads are not public goods.

I’m not buying that argument for arterials and neighborhood streets, since having two competing road networks in a city would be a huge waste of land, like having competing gas or electric companies. If arterials and streets were privately owned, they’d have to be regulated like a utility, and you’re right back to the issue of competent governance.

The argument is believable in the case of limited access tollways, where it’s easy to control access at onramps and offramps, and easy to manage demand through variable tolls. If public arterials are available, no one needs to use the freeway. However, I think there are practical limits to that model as well, which I’ll address in a separate post.