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Poor Infrastructure States Have Other Problems, Too

By April 13, 2017No Comments

How does the quality of infrastructure affect a state economy? How might the condition of roads, bridges, airports, ports, railways, and utilities affect quality of life? Do potholes on our daily commute affect us in other ways?

The CNBC cable news channel went about considering these and other factors in 2016, breaking down each condition by state. They considered such things as the percent of deficient bridges, the average commuting time to work, and what maintenance of water systems in each state would cost over the next 20 years. By their methodology, the following rankings resulted:

Worst infrastructure ratings

  1. Vermont (50th out of 50)
  2. Massachusetts
  3. New York
  4. Hawaii
  5. New Jersey tied with Maryland
  6. Connecticut
  7. Maine
  8. New Hampshire
  9. Rhode Island

Best infrastructure ratings

  1. Indiana (1st out of 50)
  2. Tennessee
  3. Texas
  4. Georgia
  5. Minnesota
  6. North Dakota
  7. Ohio
  8. Kansas
  9. Missouri
  10. Florida

By separate criteria, all states were then ranked on a number of other factors, including data sets to define “cost of doing business,” “economy,” “business friendliness,” and “quality of life.” What is notable within these assessments is that a poor infrastructure often (but not always) correlates with other negative factors as well. We share those correlations here:

Cost of living

This factors for housing, food, and energy relative to wages. By these sets of data, poor infrastructure also correlates with an unfavorable cost of living in seven states: Hawaii, New York, Connecticut, Massachusetts, Rhode Island, New Hampshire, New Jersey, and Vermont. None of the states that rank in the top ten for quality infrastructure fell into the bottom cost-of-living list.

The correlation raises a few chicken-or-egg questions: does poor infrastructure result from overall tight budgets, personal and public, because they cannot afford to pay for maintenance? Or do the costs of maintaining crumbling roads and bridges add to the tax burden as well as costs of transportation (vehicle repairs, longer trips, etc.). The relationship may not be quite so direct, but with such a strong overlap it suggests further investigation be made.

Cost of doing business

This assessment encompasses the relative competitiveness of each state’s tax climate, state-sponsored incentives other than taxation that are intended to lower business costs, utility costs (which often vary by state because utilities are state-regulated), average state wage costs, and rental rates for office and industrial space.

The correlation between high business costs and poor infrastructure was very strong; eight states with poorest infrastructure almost entirely also have the highest costs of doing business. Only New Hampshire and Maine didn’t make the bottom ten (California and Alaska did). If a state has roads pitted with potholes, bridges that have been neglected along with water, sewage, and other utility system maintenance, the burden on the public for those repairs likely translates into higher tax rates.

Note: Failure to fix smaller potholes today will result in much larger road repair and replacement costs just a few years from now. State, county, and city leaders often cut maintenance budgets in a misguided attempt to save money. The cost of deferred pavement repairs, for example, can increase by a factor of seven over just five years.

At the other end of the spectrum, Indiana (#1 in infrastructure) and Tennessee (#10) ranked among the best states for low costs of doing business.

Quality of life

It stands to reason that the quality – or lack thereof – of transport and utilities would also have an effect on quality of life. If your ride to work involves a pothole battlefield the daily imposition of such tensions wouldn’t be very pleasant.

But there is a mixed story here: Four “worst infrastructure” states (Vermont, New Hampshire, Hawaii, and Maine) rank high in quality of life, as do two “best infrastructure” states (Minnesota and North Dakota). The CNBC research based this on crime rates, anti-discrimination protections, quality of health care, level of health insurance coverage, overall population health statistics, local attractions, parks and recreation, and environmental quality.

Perhaps good health care to address headaches and the occasional chipped tooth would mitigate the jarring effects of bad pavement. But some of the aforementioned quality of life factors exist outside the sphere of road quality. People who work on the road for a living, however – truck drivers, taxi drivers, other delivery drivers, bus drivers, outside sales personnel, plus “soccer moms,” for example – arguably experience road quality to a much greater extent than do others.

So while correlation does not equal causation, the overlap of potholed roads and unfavorable costs to consumers and businesses bears notice. Two other factors that might be just as important, not included in this assessment, are simply the weather and time (i.e., the age of cities). The states with the worst infrastructure are largely clustered in the Northeast, the oldest states in the union where urban populations have existed for a few hundred years and where the worst of winter weather – snow, freezing rain, and frequent freeze-thaw cycles – lead to deteriorated pavement, stressed bridge trusses, and the like. But Hawaii’s inclusion in the list suggests something else. The CNBC report says deficient bridges and long commute times on narrow roads, as well as a stressed water system, make the Aloha State a bit less welcoming.


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