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The future of highway funding

In the ‘good old days’, things were a lot simpler. When the government built a road or started a program such as a lottery, the money was allocated to the debt service, maintenance and improvement of that designated program. These days it is not that easy. Money for ‘government wants’ far exceeds the public’s ability or willingness to pay for them. Even the Highway Trust Fund has been raided.

Thousands of special interest groups have formed, protesting that they alone need attention and feel they should pay less or no money for cash-flush programs such as tolling. I am not saying that these are not legitimate groups and projects, but how is funding for these groups prioritized? And what is the impact of these decisions?

You can argue that we should pull more toll revenue out and fund mass transit. Studies show that our youth is moving back into the cities and not driving as much. How about trucking? We really need them to move the goods that we want delivered yesterday with free shipping. Or should the retailer cover that cost, reducing profits in exchange for volume?

We all know that rail infrastructure has deteriorated and needs major funding to continue to drive our economy. Can’t you say that about our highway system also? We are not alone in the funding wars. Look at the lotteries across the country. Most were started with the good intention of funding education, senior citizen programs and other worthwhile causes. Who could argue with that?

Now, in many states, lottery programs are fighting for money to maintain the ever-increasing pressure for more profit. But what happened to the intended use of that revenue? Are the lotteries headed for the same fate as tolling? Money is being bled off for other uses of traditional tax revenue and funding for those programs has been cut. Both of these industries are a victim of their success. Is the problem that we don’t want or like change? At one point, tolling was a market disrupter in surface transportation, providing superior service and building services that our customers wanted – and we needed to compete with ‘free’.

At a recent IBTTA conference in Austin, Texas, the keynote speaker was Doug Stephens, one of the world’s foremost retail and consumer futurists. Doug gave a great presentation on how the demographics have changed not only in what we buy, but in how we buy it. Regardless of industry, market disrupters are cropping up daily with bold business models that challenge traditional sales and service methods based on consumer wants and needs. Look at what Uber is doing to the taxi market. Why would anyone ever think that same-day package delivery was needed or even possible 10 years ago? Amazon did.

After Stephens’ presentation, someone asked, “What will we do with our existing infrastructure, as it will cost too much to change to fit the new customer base?” I turn this question to you: How do we persist and move forward as a disrupter in transportation? Have we as an industry been bled dry? How can we reclaim funding and financial prioritization so that we meet consumers’ wants and needs today, tomorrow, and well into the future? Transportation is key in any economic growth, and we need to find the courage and resources to be a disrupter.

james.eden@aecom.com

 

 

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