Today we're focusing on Minnesota transportation funding. Alex Cecchini is a founding member of Strong Towns and writer for streets.mn, a website dedicated to expanding the conversation about land use and transportation issues in the Twin Cities and Greater Minnesota. This piece was published on Alex's personal blog, Fremont Avenue Experience in March 2015 and explores some pressing issues with Minnesota transportation funding on both sides of the political spectrum.
I’ve spent a good chunk of time on streets.mn lambasting the GOP for their transportation rhetoric and policy proposals. We’re still in the thick of our 2015 legislative session, and transportation is obviously a huge part of the debate. So I want to spend just a little bit more time evaluating what both parties seem eager to propose with new spending (the DFL plan is, well, quite a bit more nuanced than the GOP one).
While the Dayton/DFL proposal (I’ll just lump them together since they’re nigh indistinguishable at this point) has a lot of maintenance built-in, there’s still a good amount of new lane miles to be had – roughly $2 billion of the $6 billion total increase over the next 10 years. I take issue with this, as even the fairly long decade planning horizon misses sure increases in liabilities beyond 2025 as roads built since 1980 come due for replacement (and, believe me, we built a LOT).
I wanted to get an anecdotal sense of how new roads perform. I figured the link of US-212 from Eden Prairie to Carver is as good as any, mostly because I’m familiar with its design since I worked right nearby for 7 years, starting right around the time the freeway opened.
This 12 mile section of new freeway replaced “old 212” (Flying Cloud Drive) at a cost of $238m, and opened in 2008. On the surface, it seems like a huge win. A Mills Fleet Farm, suburban peak-hour transit operations, a McDonald’s/Kwik-Trip-focused TOD, and some serious future-proofing of congestion.
Sarcasm aside, I’m sure all the typical reasons were there to grade-separate this and add tons of capacity: goods hauling efficiency, congestion, future demand, etc. The exact same poster-child reasons we’ll hear to justify system expansions with that $2 billion extra over the next decade, from both sides of the aisle (assuming the GOP figures out where to get the funds).
We’re almost 7 years into its operation, and we know how many cars travel on it every day (from definitely credible sources) by segment:
Pretty crazy that in Carver, MN about 12,600 folks are driving it and just 12 miles later it bumps up to 54,000 cars.
So let’s calculate revenues collected on that road from users. Knowing the distances of each segment, we can surmise that on an average weekday, about 397,000 miles are driven on this 12 mile stretch. Bear with me for some more assumptions:
- Average vehicle fuel efficiency: 20 mpg (ignoring diesel vehicles)
- People take 78% as many weekend trips as weekday
- MN gas tax is $0.287/gal and the Federal is $0.184/gal (ignoring diesel)
Annual gas tax receipts come to $3.2m. But car owners also pay license fees and the motor vehicle (purchase user fee) sales tax. Prorating those at the same ratio as the total MN collection rate for all 3 (basically, applying a fair share of MVST and license fees paid by 212 drivers to this road), we come to $5.9m in 2013.
How about US-212’s costs? Well, the construction costs were $238m. Again, some assumptions:
- 20 year bond rates (required by statute) in 2008 were 5% annually
- MN highway maintenance runs $10,557 per lane mile
- 212 has 4 lanes throughout but many entrance ramps and long merging sections. I assume 5 lanes as the average cross-section
That brings a total cost for years 0-20 to $19.5m in current dollars. For those keeping score at home, we’re talking transit-level subsidies for this stretch of new road – a 31% fare recovery. Almost identical to what Metro Transit buses recover. That doesn’t make it okay just because transit is there – I’m on record supporting the type of reforms to make transit more financially sustainable.
We haven’t even begun to talk the local share for all the bridges and roads that support 212, impacts to downstream roads and subsequent capacity expansion costs, or cost burden on the Met Council for low-return sewer investments serving the nearly 20,000 commuters using the stretch daily just from Carver to Eden Prairie. It doesn’t include the expensive park and rides exurban commuters use to avoid the congestion of their own making. Nor are we including externalities.
Of course, the road’s useful life is almost assuredly longer than 20 years, and the bond payments will drop off (assuming we’re not spending millions on capacity expansion in 2028). I drove it recently to a friend’s house and it’s clearly still in good condition 7 years on. I’m not sure how to appropriately extend those costs over a 40-50 year useful life timeframe. My guess is the cost recovery would still be bad, sub-50%.
Maybe this road really does help trucks get in to the cities for convenient connections to other states or our markets. Maybe exurban commuters really do value the travel time savings. If these things are true, they should be willing to pay for the time and cost savings. We had a prime opportunity to build MnPass readers above all lanes when the highway was constructed. Why didn’t we? Probably for the same reason people hate the idea of simply keeping the gas tax.
The GOP and DFL both need to be cognizant that this is what we’re going to get for our money if we keep expanding the system.
(Top photo by AlexiusHoratius. All other images courtesy of Alex Cecchini)
About the Author
Alex Cecchini is a mechanical engineer by background currently working with the State of Minnesota developing energy efficiency programs for public buildings. He lives with his wife, young son, and two poorly behaved dogs just south of the Uptown area of Minneapolis MN. Tweets found here: @alexcecchini and occasional personal blog posts at fremontavenueexperience.wordpress.com