Wasted: Before & After 125 Million Dollars

My very first post at Strong Towns was on July 13th of 2011. Time flies.

In this post, I dove into a project that was underway here in Minnesota. It's finished now, and the results shouldn't shock anyone reading Strong Towns. The question isn't whether the $125 million was wasted, but how wasted it was.

Highway 169 and Interstate 494 can be one of the more frustrating intersections to navigate in the Twin Cities. It was in 2011 and it is in 2015. During peak periods, it is either at a stand-still or creeping along slowly, and it went without saying that something needed to be done. That thing happened and it looks like what you see below.

wasRendering of 494/169 interchange. Completed in 2012.

Here's a summary of what I wrote in 2011 about the $125 million interchange project:

Proponents of the new intersection argue it will reduce congestion and be a beacon of much needed “economic development” while “saving lives, time and money while strengthening the economy of our state and region.” Although well-intentioned, the advocates couldn’t be more wrong as they have based their assumptions on what is essentially a set of faulty principles.

Over the past 60 years, the American road building status quo has operated under the assumption “if you build it, they will come.” And for the most part, this has happened. We built more roads and continued to see more congestion. Like a broken record, we fell victim to the fundamental law of road building that states more roads will beget more traffic. This theory has been particularly true for I-494 and H-169. At its present capacity, the interchange is overused and outdated. Yet the current interchange, which was built during the mid-1990s, is only outdated because of the development pattern we’ve chosen.

For starters, I can't believe I wrote that. I'm now more likely to write words like "dude" into my blog posts. Informal is the way to write.

So, this post goes on to say that most of the congestion on 494/169 exists for reasons other than engineering (by the way, the actual engineering is good). It exists because we’ve built lots and lots of single family houses outside of the metropolitan beltway where people are reliant on driving long distances. Take a look for yourself: Scott County in 1991 versus 2009. This is precisely the type of development we’re likely to get out if we continue to subsidize massive road projects like this one.

The structural problem in our road building system is that we’ve based these large financial decisions on faulty premises and inaccurate estimations. We’ve justified and enabled the subsidizing of less efficient forms of development through the aid of cost-benefit analysis. The 494 /169 interchange looks great on paper at first glance. It’s going to create jobs, handle more traffic, help the economy, and save time.

If only these things were true.

I went to the Minnesota Traffic Mapping Application and pulled the most recent (and accessible) data. Note: traffic data collection is not perfect, and these are estimates. It's especially difficult to accurately capture daily traffic on roads like these.

169 Northbound: 2008 = 80,000 / 2014 = 87,000 (increase 7,000 cars)
169 Southbound: 2008 = 54,000/ 2014 = 48,500 (decrease 5,500 cars)
494 Eastbound: 2010 = 104,000 / 2014 = 107,000 (increase 3,000 cars)
494 Westbound: 2008 = 134,000 / 2012 = 132,000 (decrease 2,000 cars)

We've spent $125 million and 2,500 more vehicles use the roadway than in 2008/2010. While over two thousand vehicles is a lot for a resident street, it represents approximately a .6% overall increase. By itself, these numbers don't really show us much beyond relatively flat vehicle miles travels. But, let's imagine it is growing. Where are these 2,500 cars coming from? I think we all know this answer.

The cost-benefit on projects like these look merely at numbers. In this case, the interchange project has a 1.19 b/c ratio; meaning that for every dollar spent, there will be a benefit of $1.19. This savings would be remarkable if only it were true. Of the $198 million in “benefits,” $181.6 million is in the form of incremental time savings.

Like so many things, Chuck summarized the situation best in a blog post about costs and benefits:

There is no direct or indirect financial return to the government for this savings. Sure, the application argues that the “delays have a direct impact on the productivity of our local businesses and schools”, but nobody is arguing that this increased productivity will result in … million[s] in increased sales, income and property tax receipts. Or any real increase. The time savings is a purely social benefit for the people … who will now enjoy reduced travel times from the construction of the overpass.

This $181.6 million benefit is a “social benefit” – no money is actually being exchanged nor is government revenue increasing. And these small, incremental pieces of time savings do little to improve overall economic vitality. Improving an individual’s commute from, say, 1 hour to 20 minutes might spur growth, but improving the average daily commute by an estimated 3 minutes and 15 seconds will not.

We are acting under the assumption that moving cars is of the utmost importance and that traffic must be moving at a consistently high speed at all times, no questions asked. MnDOT has identified H-169 has a “high priority interregional corridor,” meaning it must “function at a free-flow level of operation, with a minimum of 60 mph speeds and minimal conflicts and interruptions to traffic flow.” A considerable segment of Highway 169 cuts in relatively close proximity to many residential neighborhoods and commercial areas. Is it absolutely necessary for vehicles to be, at all times, traveling at 60 miles an hour minimum?

Not only do policymakers need to more accurately link traffic growth estimates with current economic realities, but they also need to ask the question of whether we even want to continue to subsidize more sprawl-inducing infrastructure?

Even if this intersection does make new suburban growth possible (which it won’t), it’ll be the type of development that is destructive to our current infrastructure and simply not needed. Minnesota doesn’t need another housing subdivision or big box store.

Here's my sales pitch: I started a brief weekly musing about local news, culture, urban development, and transportation. Each "newsletter" is only 2 paragraphs, plus 1 recommendation. You can sign up here.