National Conference of State Legislators, San Antonio, TX (As prepared for delivery by Secretary Mary Peters)


12-05-06

James Simpson, Administrator
Federal Transit Administration
National Conference of State Legislators
San Antonio, Texas
December 5, 2006

INTRODUCTION
 Good afternoon! Thank you for that kind introduction, Senator (Bruce) Starr [Oregon, Chair of NCSL Transportation Committee]. It's a pleasure to be here today on behalf of the Bush Administration and Secretary of Transportation Mary Peters.
 On the podium:

 (Jack) Shenendorf [Vice-Chair of the National Surface Transportation Revenue and Policy Commission of Washington, DC]

(Robert) Darbelnet [President and CEO of AAA Foundation for Traffic Safety]

I would like to acknowledge all Chairs of the various States Transportation Committees here today…

THE HISTORY
This year, we celebrated the 50th Anniversary of the Interstate Highway System.  That system became much more than a network of roads—it connected us across State lines. Without the "dynamic element" of a unified transportation system, President Eisenhower envisioned in 1955, "we would be a mere alliance of many separate parts."
The Interstate was a magnificent feat, of both engineering and politics… President Eisenhower and the Clay Commission had such a bold vision--and the political wherewithal to persuade Congress to create a trust fund with a dedicated income source for highways.
 
THE PROBLEM TODAY
When we started building the Interstate system 50 years ago, the United States faced a major transportation challenge.  Then, we wanted to connect our nation and get goods to market.  And we succeeded.
But we are fooling ourselves if we think that we can continue to travel comfortably along the same well-worn path and achieve a similar level of progress in the next fifty years.  
 
In short: This is not the 1950s. The way we live, how we shop, and the very nature of our economy are all dramatically different today than they were half a century ago.  And all of these changes have profound impacts on our transportation network.

In 1956, when the Interstate was completed, Americans traveled 628 million vehicle miles a year; In 2002, they traveled almost three trillion.  Since 1956, the number of registered trucks has skyrocketed, from about 11 million to almost 95 million in 2003.
 
In the America of 1956, people usually lived either in cities or in the country.  Today, more than half of our population has moved to the suburbs.  And while the population of America in the 1950s was 200 million, today’s population just crossed the 300 million mark. This growth is a double-edged sword: 
It creates more demand for transportation and less space available to build and meet that demand. 

In 1956 America we traveled to stores to shop. Today, we are just as likely to go on the Internet. As a result, the "warehouse" of American business today is often an 80,000 pound 18-wheeler.
 
Companies have come to rely on "just in time" delivery from their suppliers. This can create enormous efficiency—except when congestion delays shut down a day's production. 

We experience these historical trends in our daily lives, and congestion is on everyone's mind today. San Antonio is a typical example:
• Polls put congestion first on a list of local issues.
•  Area commuters spend almost 24 million hours stuck in traffic each year;
• and they waste 15 million gallons of gas each year doing it.
• The total "congestion invoice" for San Antonio alone was $401 million in 2003.
Nationwide, the traffic toll is reaching a staggering 2.3 billion gallons of wasted gasoline, and 3.7 billion hours of wasted time each year, for a congestion bill of $200 billion annually.   

That is a tangible, measurable cost.  But there are intangible costs—in quality of life, frustration, and the dampening of our civic society. It is impossible to quantify the "cost" of parents who are impelled by congestion to leave home for work before dawn, and to return home just after their children have been put to bed.

THE PROBLEM TODAY: CONSEQUENCES
Congestion affects people’s lives in these very real ways, each day. 
Think, for example, of the stress on the mother who hits a traffic jam on the way to pick up her child from day care; who gets hit with a penalty charge for each minute she is late.  Does she start cutting short her workday based on the worst-case congestion scenario?
 
That is a case of what Secretary Peters calls the "buffer index." It refers to the unproductive, wasted time that we have to build into our schedules to accommodate the unpredictability of gridlock.   

Congestion hurts the family pocketbook; and it hurts the national economy. Businesses today are in competition not just with the shop on the next corner, or even the next town.  They are competing with retailers and e-retailers in the next county… the next state… the next country.
 
In this intensely competitive economy, transportation costs—freight chokepoints, and "buffer indexes" among them-- have become a make or break factor for business.    I experienced this firsthand as the owner of a moving company. We have all been living with congestion for so long that some of us are resigned to it, like death and taxes… But congestion is not a fact of life!  And it is not a mysterious force that we must endure…. Congestion is a symptom—a symptom of a transportation model and policies that are not working as well as they once did.  To solve gridlock we must be willing to separate good policy solutions from poor policy solutions.   
  
It is important for every one of us, as leaders, to understand that we cannot assume "business as usual" will work in the future. To succeed, we have to think, "business not as usual."  We are going to have to recognize that our transportation challenges have changed dramatically in the past 50 years – and so must our approaches to congestion.
 
SOLUTIONS:  THE NATIONAL CONGESTION INITIATIVE
 Secretary Peters has promised President Bush that the DOT will not shy away from tough issues like congestion. 
 In May of this year, the Bush Administration announced a National Strategy to Reduce Congestion on America’s Transportation Network – you might have heard of it just as the "Congestion Initiative." This plan provides a blueprint for Federal, State, and local officials to follow as we work together to tackle the growing gridlock problem.  
 
The Congestion Initiative is zeroing in on metropolitan area congestion… congestion along major corridors, and at our largest border crossings.  It is looking for solutions to congested airways and ports.
Let me share some of the highlights of the initiative, and get you thinking about where your State fits in, and what you can do as State leaders to reduce congestion…

1. Urban Partnership Agreements
First and foremost, the Congestion Initiative is tackling urban congestion through partnership agreements with metropolitan areas that are willing to apply a full toolbox of solutions to the congestion challenge.

Urban Partnership Agreements will embrace proven, effective strategies for congestion relief and reduction.  We call them the four Ts—tolling, telecommuting, technology, and transit. Working in concert, these "4 Ts" are even more powerful tools.
 
Tolling: Urban Partnership agreements call for new variable pricing programs designed to spread traffic flows throughout the day and to get more out of existing highways.  I know that tolling is a "hot button" issue in many States and communities. But cities that have adopted variable pricing have seen some impressive results. London, Stockholm, and Singapore have seen substantial decreases in traffic congestion, major increases in transit use, and tens of millions of dollars in new investments and revenues.     

Transit: Second, the Agreements will provide for more efficient and responsive public transit systems--- systems that tailor services for rush-hour commuters.  Bus Rapid Transit and Express Bus service are flexible and less costly modes of public transit.  And they take less time to establish than light-rail.  That means they can contribute some much needed, short-term congestion relief.
 
 Telecommuting: Third, reducing the number of motorists on the road during rush hour is another way to reduce gridlock.
 Telecommuters drive less than office workers. Flex-time policies can stagger schedules, which also can help decrease the number of   drivers during peak travel times. 
  
Our Urban Partners will be seeking commitments from major employers in their region to allow more of their employees to flex their schedules or telecommute.  
 
Technology: And last but not least, the final T-- technology. There are a great number of factors that cause traffic tie-ups, from poor signal timing, to traffic incidents, to weather.  Technology can help untangle congestion by providing timely information and alternate routes. 
 
Under Urban Partnership Agreements, both the Department and our Urban Partners will agree to adopt this four-point Plan, and then the Department will agree to assist them in implementing it.  We are prepared to offer technical support, provided by a world-class team of engineers and economists at DOT.  We can help to move good ideas and solid plans through the Federal pipeline faster; and, we can provide financial resources—grants, loans, and borrowing power.

3. Private-Public Financing and Partnership
And a very important final element of the Initiative:  [pause] We want to encourage States to look at opportunities for public and private partnerships to finance transit. As State leaders, you are in a position to move these partnerships forward.
 
With Trust Fund balances on a downward slope, and growth in state gas taxes lagging behind transportation needs, we must find new ways of doing business, and tap innovative funding methods.

The National Surface Transportation Policy and Revenue Study Commission, authorized by SAFETEA-LU, is leading what promises to be an historic transition in the way that highway and transit projects are funded and managed. 
 
The Commission is casting a wide net to find those answers.
STATE LEADERSHIP IN PPP…. WHAT YOU CAN DO….
 
But many forward-leaning States are not waiting for the Federal government or the Study Commission.  They are already taking advantage of the flexibilities provided in SAFETEA-LU to find fresh angles and creative ways to improve their transportation systems. 
 
Texas is one of them. This is a State that is willing to innovate.  We hold up your public-private partnership law as a model!  Last month, Texas became the first State to receive Federal approval to raise more than $1.8 billion in Private Activity Bonds for road work in the Dallas-Fort Worth area.

Indiana entered into one of the largest transportation infrastructure contracts in American history when it agreed to lease the Indiana Tollway to a private business for 75 years.  As soon as the papers were signed, $3.8 billion flowed into State bank accounts to complete the lease.

Oregon recently introduced on-board mileage counters that offer an alternative to the “pay at the pump” gas tax.  People in the test group are paying user fees based on actual mileage traveled, rather than fuel consumed.  And higher fees during peak travel times offer a real-life test of congestion pricing to ease rush-hour commutes.
 
Private companies and financiers have a growing interest in transportation investment.  But first, your States must adopt public-private partnership laws that allow you to tap into the billions of dollars that companies are anxious to invest in highway projects today. The Federal government can create flexibility… But ultimately you, as State leaders, create the momentum for change. 
 
ONGOING WORK….Questions for the Future
Parts of the Congestion Initiative that I've just outlined might be familiar to you. That's because States have often been on the leading edge of the issue, and know what we need to do. Other ideas of the Initiative are new… Some are controversial. That's as it should be. Every idea and solution is on the table right now. 
But the Congestion Initiative is not carved in stone.  It will continue to evolve as our work with you and other State leaders continues.
 
The input that we are looking for is not just “how much” but also “how to:”
• How do we design for flexibility, because our systems will need to adapt to a rapidly changing economy?
• How do we encourage and reward innovation, and take better advantage of technology?      
• And how do we give consumers a better voice in directing investments to the right place? 
 
CONCLUDING THOUGHTS
These are all challenging but not impossible questions. Congestion is not a scientific mystery. It is not an uncontrollable force. As I've talked to state and local leaders around the country, I've discovered intense interest in the congestion relief plan. I've sensed a new optimism that gridlock can be solved. 
I hope that everybody in this room will be equally enthusiastic, because the stakes are high:   We can continue to watch the performance of our transportation system deteriorate while we talk about the need for more funds, the way we always have.    
 
Or, we can take responsibility for developing a sane transportation policy that makes as much sense for the 21st century as Eisenhower’s Interstate plan did for the 1950s. 
The choice is that stark.
As State leaders, you have a vested interest in reducing congestion.  It is our task as leaders to answer the challenge.
On behalf of the Secretary and everyone at DOT, we look forward to working together with this Nation's great state leaders and legislators to do just that. Thank you.

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