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Fix Existing Roads vs. Build New: All Positions Considered

By June 24, 2015June 25th, 2015No Comments

The question on how to fix America’s existing roadways creates strange political bedfellows. Fiscal conservatives are arguing the same thing as environmental conservationists – that fixing crumbling roads makes more sense than building new ones. Part of the reason why is that people simply are driving less than in the past.

Environmentalists in the Midwest are cheering the decision of newly elected Illinois Governor (R) Bruce Rauner for cancelling the Illiana Expressway, a proposed 47-mile link between two interstates (I-65 in Indiana and I-55 in Illinois). Costs for the project would exceed $1.1 billion and credible studies suggest the toll road would fail to generate sufficient revenues to cover building and maintenance costs. Environmentalists joined Rauner and other fiscal conservatives in opposing the new highway on the basis of lost native prairie and the tendency for new roads to encourage suburban and exurban sprawl.

This is not an isolated incident, where newly proposed expressways and highways are running up against strong and effective opposition. The U.S. House Ways and Means Committee hosted a hearing on June 17, 2015 to discuss long-term financing of the Highway Trust Fund, which ideally funds highway building and maintenance. The problems with the HTF, as previously reported on, is that it frequently needs an infusion of money from the general treasury because the long-term funding source – gas taxes – are declining even while costs are rising.


How are we going to fix the potholes?

Proposals to replenish HTF funding range from different (higher, usually) fuel tax structures, to a vehicle-miles-traveled mechanism, to a hybrid of means. The issue is wrestled with by federal as well as state and city officials, as road building and maintenance are significant budget items at all levels. The quality of roads can affect local, state and national commerce in different ways: national companies need a health interstate system for shipping goods, while cities must manage traffic gridlock that relates to a host of factors: inadequate or poorly placed roads, deteriorating pavement and reconstruction that closes lanes during the high-traffic summer period, and poor public transit systems that either don’t exist or that fail to connect workers with workplaces.

But now the question pits existing roads against those on the drawing boards: Should scarce dollars be spent to build new highways when the old ones are not being fixed properly and economically?

This discussion was evident at the Ways and Means Committee hearing, where several elected representatives and industry leaders weighed in with their thoughts:

Paul Ryan (R-Wisconsin), committee chair: “There’s not much happening in this economy to help it grow, but lower gas prices is one of them,” said Ryan. “Working families have been struggling for years to get by…it would be downright unfair to take that away from them. So we are not raising gas taxes – plain and simple.”

Bill Graves, CEO and President of the American Trucking Association: “An increase in the fuel tax, with indexing, can meet current and future highway investment needs,” he said. “While the trucking industry already makes a substantial contribution to the Highway Trust Fund, clearly federal investment is falling short, and we are therefore willing to support an even greater commitment. We know the fuel tax works…it would continue to be viable for years if the rate were raised. It’s hard – I still believe the fuel tax is the lesser of all funding evils.”

Robert Poole, transportation policy director at the Reason Foundation: While stating that transitioning from gas taxes to user fees would help, he said that removing regulatory barriers would also be beneficial.

Chad Shirley, assistant director for microeconomic studies at the Congressional Budget Office: “Since 2008…lawmakers have transferred $65 billion form the U.S. Treasury’s general fund to the Highway Trust Fund so that the trust fund’s obligations could be met in a timely manner,: he said. “Moreover, with its current revenue sources, the HTF cannot support spending at the current rate.”


Fix existing roads first

The hearing took place at a time when a noticeable drop off in driving is being observed nationwide. Millennials (people born since 1980) are showing a statistically significant move toward reduced car ownership, thought to be a reaction to their parents’ debts tied to big houses, gas guzzling cars and long commutes to jobs, all while they themselves are strapped by outsized college loan debt. Instead, they are moving to urban areas where public transport, bicycling and other alternatives enable them to live without cars (and to rent them through low-commitment car share services on occasions that call for it).

This represents a sea change in the rationale behind road expansion. The conventional wisdom for more than 100 years was that more people will drive more vehicles to more places in the future. But since 2005, according to U.S. Transportation Department data on vehicle-miles driven relative to population, vehicle miles driven has dropped 8.75 percent. People are still going places, as use of public transportation and bicycling are up.

This trending away from driving began as early as the mid-1990s. The U.S. Public Interest Research Group (PIRG) reported in late 2014 that the percentage of high school seniors with driver licenses declined from 85 to 73 percent between 1996 and 2010. They further note that working people under age 24 who travel by car dropped 1.5 percentage points between 2006 and 2013, while other surveys show a preference for living in walkable city centers.

So if fewer people are driving, why are we building new highways? Currently, about 55 percent of road funds go to new construction. PIRG, the U.S. Chamber of Commerce, the Brookings Institute and many other organizations argue that existing roads should be fixed before new ones are built.

With highway-related funding a perennial source of debate, perhaps sometime soon potholes will be seen as the priority over new ribbons of asphalt. Maintenance always costs more the longer it is deferred.

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