Steps for Transportation Funding Reform

The federal interstate system; how quaint.

Over the weekend I saw more confirmation that the frenzied pursuit of additional funding to prop up our antiquated transportation funding system was running into intellectual obstacles. In an article that appeared in my local weekend paper, legislators didn't so much quibble over the amount of tax increases as much as how the money would be spent. From the article:

[Representative Ron] Kresha said he appreciates [Governor Mark] Dayton's aggressive proposal, but said it doesn't give the legislators time to come up with a more "thoughtful approach" to the problem. He said it will build up revenue, but he is concerned where the money would eventually go.

"I know we have issues in transportation," said Kresha. "Let's identify those. If we just throw it all in taxes we will fight over this big pot of money."

I suspect there are many legislators -- both here in Minnesota and nationally -- that know there is a deeper problem in transportation than simply a lack of funding. Many pundits wonder why there hasn't been a comprehensive deal thus far, but perhaps it reflects a growing awareness among decision-makers that our transportation funding system is the major problem in and of itself. Better to band aid things for another year than approve some long-term funding solution that locks our current destructive approach in place.

And destructive it is. The way we currently fund transportation is bankrupting our cities. It gives local governments every incentive to think short term, to take on the enormous liabilities that come with expanding horizontally while simultaneously allowing historic neighborhoods to decline. The more we fund this system the more we replace high returning investments with low returning ones and, perversely, the more we increase demand for even more transportation funding.

A throwaway building that costs taxpayers millions to serve with transportation improvements that still need to be maintained.

A throwaway building that costs taxpayers millions to serve with transportation improvements that still need to be maintained.

  • How many times are we going to spend millions building an interchange to accommodate a relocating Wal-Mart?
  • How many times do we watch school districts relocate facilities to the cheapest land they can find on the remote edge of town and then watch transportation officials be forced spend millions of dollars serving the site?
  • How many times are we going to delay critical maintenance in order to divert matching funds to some politically-driven earmark from Washington DC?
  • How many times are we going to watch neighborhood groups fight proposals that would improve affordable housing options and then try to address the problem with half-hearted transit investments?
  • How many times are we going to build major transit investments to park-and-ride lots while hundreds of thousands of existing transit users suffer with erratic and intermittent service?
  • How many times are we going to watch cities build recreational and scenic trails with state transportation funding when there isn't any money to paint a crosswalk or make it safe to cross a neighborhood street?
  • How many times are our transportation investments going to make a land speculator into a millionaire while the public does not recoup a dime of that windfall?
  • How many times are we going to spend hundreds of thousands on decorative brick and ADA crossings in a cornfield when people using wheelchairs in the city three miles away don't have a sidewalk?
  • How many times are we going to make a major transportation investment only to have the capacity mined by corporations in strip malls, drive throughs and big box stores?
  • How many perfectly good one-lane bridges on low-volume, country roads are we going to tear down and replace with two-lane because they don't meet a theoretical standard?

I could go on and on and on. At the heart of it, calls for more money are simply an attempt to solve a myriad of land use problems using transportation funding. This is understandable; land use problems are complex, painfully difficult to address and hyper-local while transportation funding has historically been the easiest of all cash streams to justify and exploit. Politically, it is just easier to call for more money. That way everyone gets a little bit of what they want -- at least that is the promise up front -- and nobody has to get their hands dirty actually dealing with difficult, sometimes unsolvable, problems.

So where do we go from here? I've written an e-book on transportation funding that outlines a Strong Towns approach. It contains the following core principles for funding a world class transportation system:

1.    A financial mechanism that balances supply and demand is an essential component of any transportation funding approach.

2.    Risk belongs primarily in the private sector. We should not gamble with communal resources.

3.    Where public investments are made, they must follow, and be proportionate to, productive private investments.

4.    Communal wealth must not be appropriated for individual gain.

5.    The more complex and nuanced the impact of a transportation project, the more localized the funding mechanisms and design decisions must be.

6.    Where communal funds are used to fund transportation investments, there must be intensive and ongoing accounting to monitor the financial return-on-investment.

7.    In the absence of sufficient communal revenue to meet all communal obligations, priority must be given to transportation projects that provide the greatest economic benefit.

If this is too much to bite off all at once, there are three interim steps to start on the path to real reform. First, focus auto-oriented spending on connecting places and not on paying for the first and last mile of each trip. The latter should be funded locally. Second, stop funding stroads. Just stop. If cities want stroads then that investment no longer serves any regional, state or national purpose and should be funded locally. And third, give cities more options and incentives to make high-returning investments (which today almost exclusively means pedestrian improvements, improvements for biking as transportation and transit improvements focused on ridership, not coverage area). This will also mean other reforms not generally considered transportation-related such as tax reform, changes in economic development practices and redirection of subsidies for underground utilities.

It is reckless to be pursuing more money for a transportation funding system that is so wasteful and destructive without first having a serious discussion on reform.