Sunday, November 29, 2009

Infrastructure Spending

There's an article in the New York Times that discusses the lack of major infrastructure projects around the country funded by the Federal Government. For the most part it seems as if major infrastructure projects are having to go at it alone locally.
Another approach is to finance new projects several notches smaller in cost and boldness — and in contribution to economic growth. Denver and Salt Lake City, for example, are extending light rail and bus lines into the outlying suburbs, at a cost of less than $5 billion apiece.
The Federal Government is a limited partner in these investments. For example while the Feds pay 90% of freeway expansion, more recent experience for these transit projects shows there is only a 50% match, and in more recent new starts reports that has been sliding down. Denver for example is asking for less than 40%.

With federal funds dwindling it also begs the question, if the Federal Government is not going to give regions funding for projects, why are regions sending the federal government any gas tax money? Sometimes it seems like a fairly inefficient funnel. Ultimately the MPO is the acting federal government at a regional level where there usually is no real governance. Since regions are the economic engines for the country, it makes a little sense but the federal government has too much power to tell regions what they can and can't spend money on.

But the benefits of having the federal funding mechanism dialed into the region is during a severe downturn. Ultimately that funnel can become a spigot pushing projects faster than they would normally go by providing jobs. In thinking about it this way, perhaps something they can do to help places like Denver or Salt Lake City is take over the capital funding for already under construction projects and allow those cities to use their existing capital money for operations or other projects. There are plenty of places that already have transit networks that could get pushed up if there were a guaranteed capital outlay.

I don't quite understand why the large goal oriented projects have stopped or are at least slowed. My only guess is that things have become so politicized and the no taxes groups have taken over the political landscape, making everyone else afraid to make a decision without getting hammered politically. Ultimately there needs to be a way to pay for needed infrastructure improvements, even outside of a crisis.

5 comments:

Kyle said...

This is definitely the case in Mass. All the big projects, no matter how poorly envisioned, have been pulled from the 30-year plans and politicians know we need new revenue for transpo., but won't adopt any. I'm waiting for a train to derail and people to die, then something might happen.

Anonymous said...

Roads can be used by anyone, whereas light rail is only useful to people travelling in selected corridors. It only makes sense for the government to fund modern infrastructure like freeways.

Anonymous said...

Mass transit can be used by anyone, whereas freeways are only useful to people travelling in selected corridors. It only makes sense for the government to fund modern infrastructure like light rail.

Kyle said...

"Mass transit can be used by anyone, whereas freeways are only useful to people travelling in selected corridors. It only makes sense for the government to fund modern infrastructure like light rail."

I love it. Perfect way to present how stupid some posts are.

arcady said...

Roads can NOT be used by anyone: you can't drive if you're under 16 (or 18 in some cases), if you're too old or blind or otherwise impaired, permanently or temporarily. You have to make a pretty significant investment in purchasing a car, and pay a pretty significant amount for insurance, maintenance, and of course fuel. So, many roads have fairly significant physical, mental, and fiscal barriers to entry. Whereas just about anyone can safely use a train.