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MOBILIZING INVESTMENT IN AMERICAâ€™S TRANSPORTATION INFRASTRUCTURE

UNIVERSITY OF PENNSYLVANIA SCHOOL OF DESIGN - 2018

MOBILIZING INVESTMENT IN AMERICAâ€™S TRANSPORTATION INFRASTRUCTURE

STUDIO Faculty Marilyn Jordan Taylor

Professor of Architecture and Urban Design, University of Pennsylvania School of Design

Robert D. Yaro

Professor of Practice, University of Pennsylvania School of Design

Student Xinyue Cao

Master of Science in Design Candidate, Advanced Architectural Design

Shuangdi Dou

Master of City Planning Candidate, Urban Design

Eleanor Fisher

Master of City Planning Candidate, Public Private Development

Ruochang Huang

Master of City Planning Candidate, Sustainable Transportation and Infrastructure Planning

Douglas Smith Land

Master of City Planning Candidate, Public Private Development

Michael Kevin Larson

Master of City Planning Candidate, Public Private Development

Angus Page

Master of City Planning Candidate, Public Private Development

Yipeng Peng

Master of City Planning Candidate, Public Private Development

Carrie Sauer

Master of City Planning Candidate, Sustainable Transportation and Infrastructure Planning

Yuting Sun

Master of City Planning Candidate, Sustainable Transportation and Infrastructure Planning

Yingke Sun

Master of Science in Design Candidate, Advanced Architectural Design

Chengyao Zong

Master of Science in Design Candidate, Advanced Architectural Design

MOBILIZING INVESTMENT IN AMERICAâ€™S TRANSPORTATION INFRASTRUCTURE

ADVISORS

Rich Barone

Vice President for Transportation, Regional Plan Association

Kip Bergstrom

Economic Strategy Consultant and Former Deputy Commissioner, CT Department of Economic & Community Development

Emil H. Frankel

Senior Fellow, Eno Center for Transportation

Foster Nichols

Principal Professional Associate and Manager of Transit and Rail Operations Planning, WSP

Mark Pisano

Professor of the Practice of Public Administration, USC Sol Price School of Public Policy

Peter A. Peyser

Principal, Peyser Associates LLC

Karen Rae

Senior Advisor for Innovative Project Delivery, Empire State Development

David Seltzer

Principal and Co-founder, Mercator Advisors

Dr. Lyle Wray

Executive Director, Capitol Region Council of Governments

MOBILIZING INVESTMENT IN AMERICAâ€™S TRANSPORTATION INFRASTRUCTURE

Table of Contents Item

Page

Project Overview and Executive Summary

Goals

Strategy Overview

Where Are We Now?

How Did We Get Here?

Ten Strategies

Mobilizing Transportation Investment in Los Angeles: Project Profiles

Approach

Bibliography

101

MOBILIZING INVESTMENT IN AMERICAâ€™S TRANSPORTATION INFRASTRUCTURE

Project Overview This report outlines the elements of a national transportation investment strategy for the United States. It was prepared by twelve graduate students in planning, architecture, and urban design programs at the University of Pennsylvania School of Design under the direction of Professor of Practice in Planning Bob Yaro and Professor of Architecture and Urban Design Marilyn Taylor. It builds upon research findings and recommendations published in Mobilizing Infrastructure Investment, a report developed by a transportation research seminar at PennDesign in fall 2017. Key objectives driving the studio included achieving a state of good repair on existing transportation systems, adding new and innovative transportation capacity to the United States, anticipating the impact of emerging technologies and re-thinking government financing strategies and roles. Environmental impact and equity considerations were also at the forefront of the studio. The work of this studio was informed by site visits to two US metro regions Denver and Los Angeles, each of which has created new urban and regional rail networks over the past two decades. The report describes how successive mayors each advanced the vision while creating new funding streams to support transportation infrastructure investment. It also explores how these generation investments have shaped those cities and their metropolitan regions. And while the studio focused on transportation and related urban development concerns, this was not just about moving people and goods â€”but rather about how successful infrastructure development strategies can address the broader range of urgent issues facing the country, including climate resilience, growing social, racial and spatial divisions and global competitiveness. Executive Summary

Figure 1 Members of the Studio at Denver Union Station

MOBILIZING INVESTMENT IN AMERICAâ€™S TRANSPORTATION INFRASTRUCTURE

America urgently needs to invest in its infrastructure to fix the calamitous state of its rails, roads, bridges, highways, streets, airports, and ports. Decades of disinvestment and increases in population and economic activity have resulted in a system that is congealed and rapidly deteriorating further, creating unsafe conditions for Americans and limiting capacity for future economic growth. Existing systems exacerbate income inequality and extend already long journeys to work into even longer durations, yet there has been no progress in Washington to marshal new and increasingly essential investments. Mobilizing to design and implement solutions targeting our aging transportation is urgently needed to ensure that America can compete globally and sustain economic opportunity and quality of life for current and future generations. It’s been more than six decades since the United States adopted a long-range, nationwide infrastructure strategy. Since then, federal funding, both in absolute terms and as a share of GDP, has fallen to levels not seen since the 1920s. Americans everywhere are suffering from the effects of inaction, and there is no indication that conditions will improve anytime soon. Our goal is to outline a “game plan” that can break this political gridlock.

Figure 2 Traffic in Los Angeles

Today’s infrastructure quagmire is the result of a broad range of funding, regulatory, risk management, and governmental challenges. The three greatest failures are • • •

Shortfalls in funding at all levels Outsized project delivery costs Weak decision making

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

Specifically, ● ● ● ● ●

Failure to fund or finance capital assets at the federal level defers benefits; Poorly-conceived and managed permitting processes waste money and degrade the environment; Conventional forms of project delivery extend construction times for years and add considerably to already high costs; Inadequate risk management also contributes to higher costs and schedule slippages; and In the absence of federal leadership, governments at all levels continue to postpone and defer vital infrastructure investments

The American Society of Civil Engineers (ASCE) estimates that each household’s disposable income falls by $3,400 each year due to infrastructure deficiencies. On average, congestion alone costs each driver in the United States $1,400 yearly, bringing national losses to $300 billion. In car-dependent cities like Los Angeles, drivers annually spend 104 hours in rush-hour traffic jams and are forced to sit in congestion for twice as long as they did just a decade ago. In New York City, which benefits from the nation’s greatest urban transit system, ride-hailing vehicles now outnumber yellow cabs by a factor of five and trips via ride-hailing giant Uber surpass those of taxis. Together with more jobs, reduced bus ridership, and improvements for pedestrians, car sharing services are contributing to the fact that Manhattan traffic moves at half the speed than it did a decade ago. But congestion isn’t just resulting in productivity losses; automobile crashes killed 40,000 Americans in 2016, a 14% increase since 2014, and each tank of gasoline is estimated to cause $18.42 in health and climate costs. The United States needs new, bold thinking about the future of America’s mobility system. Not since the passage of the National Defense Interstate Highway Act in 1956 has there been a long-range vision for the nation’s mobility system. Since then, the nation’s population and the number of automobiles on the roads have more than doubled, while the economy has increased more than five-fold. In the absence of a vision for the future of the nation’s roads, rails, airports and other systems, we have endured decades of disinvestment in existing infrastructure systems and under-investment in new capacity, which is desperately needed to accommodate the nation’s projected population and economic growth while also increasing equity in access to transit To generate support for greater investment in transportation, Americans need to recognize that the per person cost of building and maintaining infrastructure far exceeds the charges users incur. Looking forward, Americans will need to reach into their pockets to pay for the investments from which they directly benefit. They will also need to invest in essential transportation systems that can rebuild the economy of bypassed cities, regions and rural areas across the country. Other cross-subsidies will be required to achieve equity and inclusion as well as improved economic and environmental outcomes. Greater mobility for all Americans will result in improved access to jobs and affordable housing, benefitting the nation as a whole. In order to achieve these ambitious goals, leaders across the United States will need to advance new strategies to guide the design and implementation of infrastructure initiatives. These strategies will need to facilitate intergovernmental actions by stimulating the creation of new financing and delivery agencies. And they will need to recognize that benefits will not be fully realized without an intertwining of transportation funds and land use policies and a focus on achieving greater transit equality and environmental justice.

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

These strategies must consider the following questions: ● How should the federal role be redefined? How can it best complement local, regional and state initiatives? ● Through what policies and tools will can the federal government provide essential leadership in a system in which most infrastructure investments will continue to be defined, delivered and managed by governments at the local, regional, and megaregional levels? ● What are the incentives, grants, loans, guarantees, credit enhancement that only the federal government can provide? ● What are the tasks that only the federal government can do? We are long overdue for bold thinking about the future of America’s mobility system, and it’s time to get back on track. We propose 10 strategies to mobilize investment in transportation infrastructure The first four strategies address Funding: o

Getting Federal Funding Right: The Federal Government must take bold action to invest in infrastructure and provide powerful policies and incentives to encourage states and local governments. Private capital can be useful, but only under specific conditions; it is not a panacea. Making congressionally designated spending for infrastructure predevelopment and planning could be used as a planning tool to secure long-term funding from multiple sources. Pay the Actual Cost of Congestion: Drivers must pay the actual cost of traffic. This strategy calls for creation of congestion management systems to address ever-worsening traffic jams. Its success lies in its capacity to use taxes, fees, and tolling to reduce extreme highway congestion and to use the funds generated in capital and operating subsidies for transit alternatives, setting in motion a virtuous cycle of transportation efficiency. Create and Capture Value: After decades of disinvestment in most American cities, a renewed interest in urban centers highlights the economic potential of American cities. By focusing on train stations as a focal point for value creation, cities can propose new transit systems and public realm improvements to be financed through capturing a portion of the value created. Institutionalize Public Finance Authorities: Communities across the United States should institutionalize public finance authorities that can finance and deliver infrastructure investments. This will provide a path for the creation of a market with sustained “deal flow” for large-scale private sector funding and direct public funding of infrastructure and economic development

The next three address Efficiency: o

Streamline Project Delivery: Governments must combine multiple project delivery methods to expedite project implementation, streamline costs, and improve outcomes. The use of special purpose project delivery authorities is a proven method for implementing projects on time and on budget. Develop Dynamic Open Data and Traffic Management Platforms: Real-time transportation data platforms will enable Americans, as individuals, communities, businesses, and enterprises to make empirical decisions and empower transit riders while informing dynamic traffic management. Harness New Technology: We must integrate Transportation Network Companies into public transit, incentivize supporting infrastructure for AVs & EVs, and charge TNCs, AVs, and EVs to use public roads. The Federal government should be responsible to develop system guidelines and recommendations. Optimize the System: Our studio proposes merging modal silos in transportation agencies at the federal, state and local level into a single entity through which transportation funding,

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

decisions, and management operate. A one-stop-shop for all transportation business optimizes the public benefits of transportation investment. The last two express the need for Vision: o o

Redesign Goods Movement System: A robust and reliable freight transport network is critical for the nation’s economy. Different freight transportation modes include freight rails, inland waterways, trucking and freight airlines. Plan Ahead for High-speed and Intercity Rail: America must develop a long-term framework for high speed rail in the United States, funded predominantly by the federal government. High speed rail can connect regions, promote megaregional economies and labor markets, bolster underperforming regions, and provide talent with greater access to jobs and housing. High performance rail networks can link cities with HSR lines and to each other, rebuilding economic potential in bypassed places across the country.

Transforming Mobility in Los Angeles The Los Angeles region provides a corollary for the transportation issues and opportunities facing regions across the country. With 18.7 million residents as of 2015, LA is America’s second largest metropolitan region and is projected to add 3.4 million residents by 2040 in a region that already has the world’s most highly congested roadway network. In response to these challenges, LA has advanced an ambitious program to build an urban and regional rail network virtually from scratch over the past quarter-century, financed mostly by taxes authorized through voter initiatives. It has also created a new national model for infrastructure finance: Enhanced Infrastructure Finance Districts (EIFD) provide creative and flexible financing for these investments. Despite adopting a $100 billion transportation investment plan, however, LA still cannot afford to modernize and expand this system sufficiently to meet current and projected transportation demand and reduce highway congestion, underscoring the need for significant new federal matching funds for these investments and a creative new approach to find regional funding, generate ridership, and reduce costs. New federal funds and a new approach to transit stations can resolve LA’s transportation issues and, more generally, those of America’s transportation system. Specifically, investments in LA Union Station the Metrolink Regional Rail system, with focus on the I-5 corridor, have the potential to leverage the 10 strategies described herein to transform Los Angeles. Though each component - high-quality design and high-quality transportation service - stands on its own merits, we believe their interaction of a new Station and an enhanced Metrolink network will produce the greatest possible impact. The realization of these projects will set a standard of focusing on well-designed infrastructure investment to inspire similar projects across America. Other U.S. regions are already facing, or will soon face, similar challenges and can learn from the proposed innovations and achievements in the process of investing in America’s infrastructure. Approach These two specific examples from Los Angeles illustrate how these strategies will work in practice, but on a national scale and across the many geographies where we are proposing interventions, there are many other types of considerations to be made.

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

We propose project frameworks at different geopolitical scales to align decision-making, funding/financing, and governance with the geographies where problems occur and benefits accrue. We define project scale categories as: • • • • • • • •

National projects, defined as federal systems spanning multiple states; Projects of National Significance, including specific projects that have significate GDP impact and benefit 25% or more of the national population; Megaregional projects, consisting of infrastructure connecting large networks of metropolitan regions that share environmental, infrastructure, and economic systems within an identified megaregion State projects, including transportation under the jurisdiction of a single state; Multi-state projects, or those requiring the cooperation of multiple states; Regional projects, connecting larger metropolitan areas to smaller cities, surrounding suburbs, and exurbs; Local projects, including transportation infrastructure aimed at site-specific; neighborhood, or district geographies; and Projects in rural and bypassed areas, including projects serving economic development goals in underperforming areas.

America’s infrastructure urgently needs new strategies targeting funding, efficiency, and vision for the next generation. A complete overhaul of the infrastructure planning and procurement process is required to lower costs and speed delivery of needed projects. The time for investment is now.

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

Goals America needs a 21st century transportation network that will decongest the nation’s cities and metropolitan regions, increasing capacity across systems and getting people from point a to point b in less time. Transportation infrastructure should provide ennobling and exhilarating experiences, inspiring a sense of pride and ownership in the spaces where we travel. Transportation infrastructure should be equitable and accessible, connecting Americans to good jobs regardless of where they live. Transportation infrastructure should be safe; traveling throughout your community should not put you at risk. Transportation infrastructure should provide carbon neutral solutions that ensure a healthy future for our environment. Transportation infrastructure should promote smart growth, delivering new systems that maximize land use without creating urban sprawl. Friction-Free movement means de-congesting all modes, eliminating the “first and last leg” challenge for transit passengers, and upgrading systems so that they are less prone to failures. It will require greater investment to achieve a state of good repair, additional capital to increase efficiency, the use of new technologies to quicken the speed of travel, and reformed institutions to manage and finance these systems Ennobling and exhilarating experiences are shaped by design that inspires a sense of pride. Citizens must adopt a sense of ownership around transportation and appreciate the benefits of good design. New York’s Grand Central Terminal, London’s Saint Pancras International, and Denver Union Station show how transit stations can contribute to placemaking and enhance the identity of a particular place while generating value for investors. Equitable and accessible transportation provides convenient travel options for all. In many places, low-income populations and communities of color possess fewer and more dangerous transportation choices. Strategic investments in bypassed cities and rural areas can also reduce their economic and social isolation. Improving access to quality transportation is an essential step towards greater economic prosperity for all these communities Safe transportation should remain a top priority for all governments and the number of deaths related to automobiles should fall to zero. Americans must feel comfortable commuting to work – on foot, in a vehicle, or on transit – and state-of-the-art systems need to be engineered with the security of their users in mind.

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

Carbon neutral transportation means achieving net zero carbon emissions. Transportation is a massive source of carbon dioxide emissions in the US and around the globe, so it is imperative that communities tackle this pollution by limiting energy usage and using renewable energy sources when possible. The air we breathe and the water we drink depend on it.

Promoting walkable, transit-friendly development can increase transit ridership, reduce highway congestion, improve public health, reduce carbon production and expand affordable housing opportunities.

MOBILIZING INVESTMENT IN AMERICAâ€™S TRANSPORTATION INFRASTRUCTURE

Strategy Overview Not since 1956, when President Eisenhower advanced passage of the National Interstate and Defense Highways Act, has America had a forward looking national transportation investment strategy. Since then the nation’s population and number of vehicles on its roads have doubled and the economy has grown five-fold. But after decades of disinvestment in its roads, rails, airports and urban transit networks, all of these systems are highly congested and deteriorating. Every aspect of our transportation system, moving people or moving goods, is outdated and congealed. Whether you are driving, riding transit, or moving goods across the country, our mobility system is increasingly unreliable. It is time for Americans to rethink and invest in the future of our transportation infrastructure. Lack of investment in these systems is limiting productivity growth and global competitiveness. For most of the 20th century, America’s roads, rails and other transport systems made this the most efficient place in the world to move people and goods. But in recent decades, growing congestion and bottlenecks in all of these systems —while other developed and developing countries have made massive investments in their own infrastructures— is now undercutting the ability of American companies and workers to compete globally. And by limiting productivity growth, continued disinvestment will undercut future tax revenues needed to support federal investments in national security and defense. This will only get worse unless bold steps are taken to ramp up these investments and reform the way we manage and deliver major projects. In this sense, making major new investments in America’s transportation systems is now every bit as much a national defense issue as it was when President Eisenhower pushed for adoption of the National Defense Interstate Highway system six decades ago. Americans are suffering from the effects of inaction and lack of investment. The American Society of Civil Engineers (ASCE) estimates that each household’s disposable income falls by $3,400 each year due to infrastructure deficiencies. On average, congestion alone costs drivers in the United States $1,400 yearly, bringing national losses to $300 billion. In car-dependent cities like Los Angeles, drivers now annually spend 104 hours in rush-hour traffic jams. In New York City, which benefits from the nation’s top urban transit system, ride-hailing vehicles now outnumber yellow cabs by a factor of five and trips via ride-hailing giant Uber surpass those of taxis. But cars aren’t just resulting in productivity losses; automobile crashes killed 40,000 Americans in 2016, a 14% increase since 2014, and each tank of gasoline is estimated to cause $18.42 in health and climate costs. The United States needs new, bold thinking about the future of America’s mobility system. In the absence of a vision for the future of the nation’s roads, rails, airports and other systems, we have endured decades of disinvestment in existing infrastructure systems and under-investment in new capacity which is desperately needed to accommodate the nation’s projected population and economic growth. To achieve the ambitious goals outlined in this report, guidance will be required for the design and implementation of infrastructure initiatives and to define the role of the federal government. Over the

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

semester, our studio has developed ten strategies to provide this guidance. These strategies follow, ordered roughly by their intended timeframe and grouped by their primary objective. Funding 1. Get Federal Funding Right: Implement small reforms at the Federal level to remove gridlock and give Congress the tools it needs to pass long-term infrastructure bills and direct funding to projects of national significance. 2. Pay the Actual Cost of Congestion: Increase taxes, tolls, fares, and fees to make drivers pay the actual cost of the traffic they create. 3. Create and Capture Value: Incentivize private investment in areas surrounding transportation hubs by improving their design, public realm, and function, and finance these infrastructure improvements by capturing the future incremental increase in property value created by private development. 4. Provide Public Benefits Using Public Finance Authorities (PFAs): Establish PFAs that can match the geography of the problem with the authority delivering the solution. They will gather and align funding from all geographies and parties benefited by projects and will be responsible for arranging project financing based on these unified funding streams. Efficiency 5. Streamlining Project Delivery: Minimize current regulatory barriers to efficient project procurement while still limiting the negative externalities of transportation infrastructure projects. 6. Open Data Platforms and Dynamic Traffic Management: Develop real-time transportation data platforms to enable empirical decision making, empower transit riders, and inform dynamic traffic management. 7. Get Ahead of New Technology: Provide a dedicated funding stream for the continued development and management of new technologies like AVs and TNCs that have the potential to revolutionize American transportation. 8. Optimize the System: Establish a new, outcome-focused approach to infrastructure spending. By enabling cross-subsidization and breaking down the funding silos between modes and regions, transportation investments will maximize public benefit, supporting friction-free movement across geographies and communities. Vision 9. Invest in Logistics: Develop comprehensive long-range plans that leverage public-private partnerships and new technologies to make smart, targeted upgrades in freight bottlenecks, ensuring robust economic growth in the future. 10. Plan Ahead for High-Speed and Intercity Rail: Begin development and planning for a series of highspeed rail systems that will better connect metropolitan areas, expand housing markets, and drive economic growth across megaregions.

MOBILIZING INVESTMENT IN AMERICAâ€™S TRANSPORTATION INFRASTRUCTURE

Where Are We Now? Our Failing Infrastructure The decline of infrastructure in America has been well publicized in recent years - the United States received a D+ on the American Infrastructure Report Card from the American Society of Civil Engineers (ASCE) in 2017 and Fortune Magazine named 2016 “the deadliest year on American roads in nearly a decade” - and yet, little action has been taken to improve our transportation systems to even a state of good repair, let alone increase our capacity for moving people and goods.

ROADS & TRANSIT $1,101B

RAIL $29B

AVIATION $42B

PORTS $15B

= $1.2 Trillion needed to achieve a state of good repair

As a result, Americans are suffering from the effects of an aged transportation network that can no longer meet modern demands. The ASCE estimates that United States’ households lose $3,400 in disposable income each year due to infrastructure deficiencies. On average, congestion alone costs drivers in the United States $1,400 yearly, $300 billion loss in productivity. In car-dependent cities like Los Angeles, drivers now annually spend 104 hours in rush-hour traffic jams. But cars are not just resulting in productivity losses; automobile crashes killed 40,000 Americans in 2016, a 14% increase since 2014, and each tank of gasoline burned has been estimated to create $18.42 in health and climate costs. Every aspect of our transportation system, moving people or moving goods, is outdated and congealed. By 2020, poor infrastructure across the nation will result in $897 Billion in U.S. GDP losses. For the average American family, this means losses of $1,060 per year or $3 a day, and 877,000 fewer American jobs. For businesses, an additional $430 Billion in transportation costs can be expected. Figure 3 Changes in U.S jobs Attributable to Transportation Infrastructure Deficiencies

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

Roads and Bridges Roads are the most ubiquitous form of transportation infrastructure in the United States. Today, there are over 4.1 million miles of blacktop on which US drivers clock over 3.2 trillion miles yearly. Since President Eisenhower led the authorization for the national Interstate highway system in 1956 this limited access highway system has grown to 47,575 miles, however, this represents only about 1% of America’s overall road infrastructure. Most roads are owned and operated at the local level, with local governments responsible for maintaining around 77% of the total road infrastructure. Most American roads, representing about 71% of the total mileage, are also found in rural areas. Funding for road repairs primarily comes from taxes on gas and tolls from limited-access highways. At the Federal level, The Highway Trust Fund helps support road upkeep and is funded by an 18.4 cent per gallon tax on gasoline and a 24.4 cent per gallon tax on diesel. However, the federal gas tax has not been raised since 1993 and in 2015 Congress had to pass the Fixing America’s Surface Transportation Act (FAST Act) to shore up the Trust Fund. Since 1993 39 states have raised gas taxes —5 of them in 2017 alone to cover the rising cost of maintaining highways.1 With limited road funding, congestion is increasing and today the average American spends 42 hours in traffic every year. Poor road top conditions cost the average motorist over $533 in repairs per year. An important part of America’s road infrastructure is the bridges that allow for the crossing of difficult terrain. As of 2016, there were 614,387 bridges in the United States. Almost 246,000 of which are older than 50-years, the typical lifecycle for this type of infrastructure, and the average age is 43 years. Today 9.1% of bridges are structurally deficient, meaning that they are only able to carry a limited capacity or have the potential to be closed in the future, greatly affecting travel times for both logistics and Figure 4 Surface Transportation Inventory personal vehicles. The American Society of Civil Engineers estimates that there is an $836 billion backlog in capital needs to support roads and bridges in the country.2

"States Raising Gas Taxes to Fund Transportation Improvements." Fox News. Accessed June 05, 2018. http://www.foxnews.com/politics/2017/06/20/states-raising-gas-taxes-to-fund-transportation-improvements.html. 2 ASCE, “Roads”, Infrastructure Report Card, 2017.; American Trucking Associations, Reports, Trends & Statistics, 2017. 1

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

Mass Transit American cities have seen huge increases in the usage of their transit systems over the past 20 years. Nationally, buses are the most common type of public transit and account for roughly half of the 10.5 billion passenger trips in 2015. There are only 12 rapid transit metro systems in the United States, including the Tren Urbano in Puerto Rico, but many more cities are building light and regional rail to accommodate growing populations. Figure 5 Mass Transit Inventory Because of this, linear distance of public transit routes has increased by over 26% over the last decade. This is primarily due to large increases in light and regional rail systems. It is also not just urban areas that have seen growth in public transit, rural areas are also increasingly served by commuter buses and paratransit shuttles. However, over 51% of Americans cannot currently get to a grocery store using public transit despite nation-wide urbanization trends. Many urban infrastructure systems are experiencing demand above and beyond what they were designed for. Typically, transportation agencies rely on local, state, or federal funds to supplement fairbox revenue which usually only accounts for 45% of needed operating expenses. However, many transit agencies are chronically underfunded and that has led to over 30% of the nation’s mass transit tracks and stations not being in a “state of good repair”. The American Society of Civil Engineers estimates that mass transit will need over $122 billion in investment by 2032.3 Inter-City Rail The United States is virtually alone among developed countries in that it does not have a high-speed rail system. It also lags many other developed countries in terms of passenger rail ridership, but the number of users is quickly growing in certain corridors. Currently, there are two inter-city rail companies in the United States, Amtrak and the Alaska Railroad, both of which are government-owned. The vast majority of Amtrak’s passengers travel within the Northeast and the nation’s 10 other megaregions and on state funded rail corridors in New England, the mid-Atlantic states, the Midwest, Northwest and California. Despite the size of the freight rail system, Amtrak only owns 623 miles of track, mostly in the North East Corridor, and the Alaska Railroad only owns 470 miles, all in Alaska. While the Alaska Railroad only operates on its own tracks, to provide national service Amtrak relies on over 20,000 miles of freight rail right of ways to reach over 500 communities and 46 out of the 48 contiguous states. Because of this, Amtrak is dependent on freight rail maintenance and scheduling to provide 3

ASCE, “Transit”, Infrastructure Report Card, 2017.

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

useful service to consumers, and many of the national routes face significant delays due to freight rail prioritization. While the current passenger rail system in the United States is government-owned, there are a number of private high-speed rail (HSR) companies looking to start service in some key corridors that could bring outside capital to the system. And the State of California is proceeding with construction of a statewide HSR system. However, Amtrak will still need to deal with a backlog of upgrades, some over Figure 6 High-speed Rail 100-years old. Recently, Amtrak has covered over 94% of its operating costs from revenue and state subsidies alone. Federal funding only accounts for 6% of Amtrak’s yearly budget; but this number is increasingly shrinking despite the need for capital investments to cover growing ridership. In 2017, Amtrak ridership increased by 1.5% to includes over 31.2 million passengers. Even though rail accidents have decreased in number and severity in the last decade, recent accidents have also shown the need to speed up the adoption of positive train control, another capital cost that Amtrak must contend with. Experts estimate that Amtrak will need to spend over $28 billion to get to a state of good repair without expanding capacity.456 Freight Rail America has some of the best freight rail infrastructure of any country. In terms of size, there are more than 140,000 miles of track and 538 railroad companies operating in the country. There are three classifications of freight rail, Class I (revenues of more than $433.2 million), Class II (regionally sized), and Class III (local). Class I rails account for the majority of rail traffic in the United States, making up almost 70% of total freight rail mileage. The size of the current rail system is adequate for meeting current demand, and Class I rail can increase capacity on current routes by using double stack containers. However, there are a number of bottlenecks in the existing freight rail network, many of them in large cities such as Chicago. Further, as traffic has increased, rail companies have and need to, invest in intermodal facilities. These include connections to trucks, ships, and dry ports where freight containers can be exchanged and stored. The Federal Railroad Administration expects freight rail traffic to increase by 40% through 2040 and the Class I railroads will need to invest a significant amount of capital to upgrade systems to meet federal positive train control requirements.

ASCE, “Rail”, Infrastructure Report Card, 2017. Amtrak National Facts, Amtrak, 2018. 6 Railroad At a Glance, Alaska Railroad, 2017. 4 5

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

Funding for Class I freight rail systems in the United States comes from mostly private investment and cash flow from the rail companies. However, Class II and Class III railroads often require state and local funding to support upgrades to tracks and bridges. These railroads often serve more rural and remote communities and provide a vital link for farmers and local manufacturers seeking to enter national and global markets. It is estimated that regional and local railroads will need an additional $5.3 billion to support Figure 7 Freight Rail Inventory their upgrade efforts.7 Inland Waterways The United States’ inland waterway system includes over 25,000 miles of navigable waterways and connects 38 states to global markets. Yearly, over $229 billion of goods and 14% of America’s domestic freight are transported across America’s heartland to ports near and far. Almost half of these navigable waterways are directly controlled by the Army Corp of Engineers. Funded by a $0.29/gallon tax on barge fuel, the US Army Corp of Engineers is responsible for dredging channels and maintaining 237 lock chambers across 191 lock sites. Notable channels include the Great Lakes, the Hudson River, and the Mississippi River, as well as dredged shipping routes to coastal ports like Savannah and Philadelphia. Significant inland ports include Memphis, St. Louis, and Chicago, among others. Due to natural geology and landscape, most of the nation’s inland waterways are in the eastern half of the country. However, many of the channels need to be dredged and most locks are beyond their anticipated 50year lifecycle. This means that vessels are often delayed, and the 2017 Making the Grade report by the ASCE estimates that the average delay per lock was 121 minutes in 2014. Over 49% of vessels experience delays while navigating the inland waterway. As of 2017, the system is estimated to require $4.9 billion in investment coming almost entirely from the Federal government, as the primary operator.8

Association of American Railroads, Overview of America’s Freight Railroads, 2017.; ASCE, “Railroads”, Infrastructure Report Card, 2017. FRA, Freight Rail Overview. 8 ASCE, “Inland Waterways”, Infrastructure Report Card, 2017. 7

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

Ports The United States’ has over 900 commercial ports currently in operation, spread across both the mainland and island territories. These ports are the country’s main logistical connection to the world and over 99% of the country’s global trade passes through them. Yearly, ports contribute $4.6 trillion in economic activity. However, increases in demand for global trade have forced ports to rapidly expand in recent years. The American Association of Port Authorities estimates that most major cargo ports in the United States will see double the traffic that they were designed to handle. At the same time, cargo ships are only getting larger, forcing many ports to take up expensive dredging operations to accommodate the drafts of the post-PANAMAX ships. Typically, this Figure 8 Ports and Inland Waterways Inventory work is supported by the Army Corps of Engineers and paid for from the Harbor Maintenance Trust Fund, which is funded by a 0.125% fee on the value of each imported shipping container. To remain economically viable in an increasingly competitive global environment, American ports need to invest more than ever in both land and water connections. Congestion at land-side intermodal connections has decreased port productivity by over 25% in recent years and it is estimated that mitigating this congestion would require almost $30 billion in investment across the country. Similarly, it is estimated that at a national scale, ports will need to invest over $150 billion in modernization and repairs on existing infrastructure. Notably, this number does not account for the costs of mitigating rising sea levels, which could cost an additional $1.2 billion per port.9 Aviation Airports provide a valuable link for residents in the United States who want to reach foreign countries or even travel across America. Civil aviation has been one of the strongest drivers of national GDP and has accounted for over 5.4% of GDP growth in the past. In the United States, there are over 3,345 airports, but only 514 have true commercial service. While over 2 million passengers fly every day in the United States, cargo is also an increasing operation that airports need to contend with. Cargo aviation accounts for 27% of the country’s exports by value. Increases in passenger and freight have led to delays at many US airports and the majority of future airport spending needs to be directed to

ASCE, “Ports”, Infrastructure Report Card, 2017.; Austin Becker, David Newell, Martin Fischer, and Ben Schwegler, “Will Ports Become Forts?”, Terra et Aqua, 2011. 9

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terminal and cargo facilities rather than to runways. Funding for airports typically comes at the local level from general airport revenue, as well as general obligation bonds and grants. Airports can also collect a Passenger Facility Charge for every passenger, but this has been capped at a maximum of $4.50/passenger since 2000. Additionally, congested airports may charge landing and/or gate fees on landing aircraft. As air travel in the United States continues to increase, there is also a need to invest in NextGen air traffic control. Numerous proposals have been put forth for how this can be done safely and in a cost-effective manner, including incorporating the country’s air traffic control as a non-profit. Yearly, the Federal Aviation Administration spends $7 billion on air traffic control and over $1 billion on safety standards. NextGen would rely on GPS satellite technology, instead of Figure 9 Aviation Inventory today’s radar, easing airspace congestion and increasing safety. Implementing NextGen is expected to cost the public $13.6 billion and airlines $15 billion in updates to new cockpit technology, all to be completed by 2025.10 Conclusion America has one of the most diverse and expansive transportation networks in the world. It is a product of boundless American enthusiasm and the belief in ever expanding opportunity. However, much of what we see today is legacy infrastructure—built years ago and neglected ever since. It struggles under increased capacity and is structurally deficient in key bottlenecks that have aged beyond their engineered lifespans. It was not always like that. Infrastructure built the United States, with projects like the Transcontinental Railroad and the Interstate Highway System driving double digit GDP growth and bringing prosperity to millions of Americans. How did we let something so good get so bad? At a surface level we took it for granted, but the story of our country’s infrastructure decline goes much deeper.

ASCE, “Aviation”, Infrastructure Report Card, 2017.; FAA, The Economic Impact of Civil Aviation on the U.S. Economy, 2016.; FAA, Passenger Facility Charge Program, 2017. 10

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How Did We Get Here? / Our Greatest Failure Underinvestment in America’s infrastructure over several decades has led to the steady decline of our transportation systems. The share of United States GDP spent on infrastructure has fallen 50% since the 1980s; the aging of core transportation networks like the Interstate Highway System and lack of support for maintenance and new investments has already started to threaten American productivity. American infrastructure systems built in the mid-20th century have started to deteriorate, and more investment is needed to upgrade these networks to meet the 21st century needs of our economy. At the same time, outsized project delivery costs mean that even projects with support often have trouble getting completed. Failure to Fund The United States infrastructure investments pale in comparison to those made by its counterparts in the Organization for Economic Co-operation and Development (OECD). In 2015, the United States spent 0.6% of its GDP on gross capital investment in inland road, rail, and waterway transportation infrastructure. As indicated in Figure 10, this paltry share of GDP represents approximately half of the OECD average, 1%, and one tenth of China’s commitment, 5.3%11. This underinvestment jeopardizes both the United States’ economic growth potential and America’s position in the global economy, as our outdated networks make our systems less efficient and hamper output.

Infrastructure Spending as a % of GDP: OECD Countries 2.00% 1.50% 1.00%

1.00% 0.62%

0.50% 0.00%

Figure 10 Infrastructure Spending as a % of GDP According to the American Society of Civil Engineers (ASCE), the United States needs to commit an additional $2 trillion to achieve a state of good repair throughout its transportation infrastructure and earn a grade of B by 2025.12 Even though Congress and some states have recently made efforts to increase spending, a funding gap of $1.2 trillion remains. To minimize further economic consequences AOECD (2018), Infrastructure investment (indicator). doi: 10.1787/b06ce3ad-en (Accessed on 12 April 208) ASCE. “2017 Infrastructure Report Card: Economic Impact.” https://www.infrastructurereportcard.org/theimpact/economic-impact/ 11 12

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facing individuals, families, businesses, and the national economy, Congress must invest an additional $206 billion each year. This is far in excess of the $20 billion per year, 10-year investment proposed by the White House in its 2018 infrastructure proposal.

Surface Transportation

Airports $42B

$1101B

$941B $115B

Rail (Amtrak & Freight)

Inland Waterway & Ports

$29.4B $15B $22B $124.7B

Figure 11 Funding Gap Outsize Project Delivery Costs Delivery of major infrastructure projects in the US is costlier than any other major country in the world. For example, the recently delivered Second Avenue Subway in New York carried a $2.5 billion price tag per mile, nearly four times as Figure 12 2nd Avenue Subway in New York City much as Amsterdamâ€™s Noord-Zuid Subway, which totaled $615 million per mile. While the Second Avenue Subway is unusual in its complexity, running through the heart of Manhattan, the Noord-Zuid Subway also required sophisticated engineering and incurred unexpected cost overruns, delays, and damage to nearby buildings. Although large scale projects like these can be difficult to compare, it is clear that the cost of infrastructure is unusually high. Figure 13 Noord-Zuid Subway in Amsterdam

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The cost of project delivery is tied to multiple factors, including a “start-and-stop” funding process and inefficient permitting and procurement procedures and archaic labor practices and union work rules. Well into the process of building a new station for the Long Island Rail Road’s East Side Access terminal under Grand Central Terminal in Manhattan, for example, an accountant realized that there were only 700 jobs but 900 hundred employees onsite; there were 200 contractors on site who were being paid $1,000 a day without any clear roles or responsibilities. Secondly, the National Environmental Protection Act (NEPA), results in a process with an average cost of $1.4 million and processing time of 4.6 years. Also, American delivery models are overly restrictive. Relatively few states have enabling legislation or provide support for innovative delivery models like DB, DBOM, or P3s (Design-Build, Design-Build-OperateMaintain, and Public-Private Partnerships, respectively), which have Figure 14 Typical Range of been demonstrated as efficient models when used effectively. And Subway Construction Costs finally, excessive red tape for projects accepting federal or state dollars can create projects where the additional federal funds are accompanied by arduous auditing, labor and other requirements that add considerably to the time and cost required to deliver projects. Poor Decision-Making Two decision-making problems also compromise today’s infrastructure: first, the tendency for government to prioritize projects over programs; and second, the reluctance to adopt innovative engineering, procurement, and project delivery procedures. These challenges hinder our ability to make these investments in a timely and cost-effective manner. For example, to manage congestion, adding road capacity through building lanes is a common solution. A report stated that from 2009 to 2011, states spent 55% of their road budgets ($20.4 billion) on road expansion. However, it is now well understood that new highway capacity tends to generate additional traffic. On America’s second most congested road, Houston’s Katy Figure 15 Traffic on the IH-10 Katy Freeway Freeway, for example, additional travel lanes have been added in Huston. (Smiley N. Pool / Houston to reduce congestion. In 2009, it reached 26 lanes. Travel time Chronicle) decreased right after each additional lane was added. However, because of induced demand, travel using the Katy Freeway now takes even longer than it did before widening projects were completed.

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Today’s reactive approach to infrastructure investment in the United States is also illustrated by the failure of the I-35W bridge in Minneapolis, a heavily utilized connector known to be structurally deficient since the 1990s. Fifteen people died and 145 were injured when the bridge collapsed in 2007, and many local businesses saw a 40-50% decline in profits in the months following the collapse.13 The total economic loss to Minnesota’s economy was estimated at $60 million from 2007-200814 on Figure 16 I-35W bridge collapse in top of the replacement cost of $400 million.15 Ultimately, in their Minneapolis rush to reopen the highway following this disaster, policymakers leading the reconstruction ignored the need to expand the bridge’s capacity and the possibility of integrating light rail, two desires voiced by local officials and the public, just to ensure the project arrived on time and on budget.16 This reactive approach to infrastructure investment is costly, ineffective, and results in poorlyconceived projects. Doing nothing or postponing action results in greater spending over the long term and foregoes many social and economic benefits. Our Greatest Opportunities In the face of today’s financial and leadership challenges affecting transportation infrastructure, we have identified four overarching areas in need of change. These broader issues are hindering both current transportation operations, and future developments and innovations. They include: the need to increase funding, to create long-range plans, to re-evaluate our approach to costs and benefits, and to embrace new technology. New Funding After decades of inadequate investment in transportation, America’s transportation infrastructure has noticeably declined, and projected funding allocations dedicated to transportation over the next ten years are insufficient to reach a state of good repair. Moving forward, America must increase funding for transportation. First, the federal government must step up and contribute more money to transportation. The federal government has long relied on the $0.184 cents per gallon fuel tax, set in 1993, to fund transportation. In addition to the $0.35 tax levied by state and local governments. As fuel tax revenue has decreased to only 60% of the 2002 revenue, the federal government spending on transportation has fallen to

Anderson Jr., G.R., “Economy in Freefall: Businesses around the 35W bridge site may not survive to see a new span”, CityPages, 2007 14 Minnesota Department of Employment and Economic Development, Economic Impacts of the I-35W Bridge Collapse, 2011 15 Tom Scheck, “Cost of bridge collapse could reach $400 million”, MPR News, 2007 16 Tom Scheck, “I-35W bridge reconstruction could delay other projects”, MPR News, 2007 13

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2.2% of federal total spending in 2017 fiscal year17. These funds are spent mainly on highway projects (81%), as 79% of the funds comes from fuel and vehicle taxes. We need to increase the gas tax to regain the purchasing power it has lost since it was last increased in 1993. Currently the U.S. combined gas tax is significantly lower than other industrialized countries, which average $2.62 per gallon, according to the OECD.18 The US Chamber of Commerce has proposed that the federal gas tax be increased by $0.25 per gallon, with five cents increase per year up to $0.43, and the $0.24 per gallon diesel tax five cents per year up to $0.49. In the 25 years since the gas tax was last increased, it has lost about 40% of its value due to inflation. While policy makers are divided over a tax increase, estimates show that it would generate about $840 billion in revenue by 2050,19 providing much needed funding to transportation projects. Fares, fees, tolls and taxes can also be used for “pay as you go” and to pay the debt service on project financing. For example, Canada, China, Australia, and France rely on private roads, concessions, or private-public partnerships to fund some of their road infrastructures. Countries like Japan, France, and Netherlands, rely on tolling systems to obtain part of their revenue for financing roads. Also, England and Sweden began discussions on road pricing in 2012. Transitioning to a user-charge system and providing dedicated funding for projects is a viable solution. Although the current $1.2 trillion transportation investment gap is an astounding number, it becomes more palatable when divided into the number of daily users who rely on the system; calling for only one dollar a day per person, this is less than the induced cost of travel and car maintenance resulting from inaction.

Dedicated Project Delivery Entities Once new funds are raised, we need dedicated project delivery entities that can drive down the cost of delivery by managing efficient delivery methods (DB, DBOM, P3), attract private investment through new financing entities such as PFAs and infrastructure banks, and manage regulatory processes. Both

“USAspending.gov.” 2018. USAspending.gov. Accessed May 17. https://www.usaspending.gov/#/explorer/budget_function. 18 Pomerleau, Kyle. 2017. “How High Are Other Nations' Gas Taxes?” Tax Foundation. Tax Foundation. January 16. https://taxfoundation.org/how-high-are-other-nations-gas-taxes/. 19 Orvis, Robbie, “Effect of A $0.25 Federal Gas Tax Increase on U.S. Economy, Fuel Use, Fleet Composition,” Energy Innovation, 2018. Accessed May 17, 2018. http://energyinnovation.org/wp-content/uploads/2018/02/US-Gas-TaxResearch-Note_FINAL.pdf. 17

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Crossrail, UK and Denver Union station had benefited from dedicated project delivery entities and delivered project on time and on budget. New Technology Lastly, the United States is entering a period of rapid innovation in transportation introducing new fuels and propulsion systems, ride-sharing, connected vehicles, automated vehicles and other technologies. These innovations will in the near horizon have the potential to shift people and goods movement drastically, achieving superior results in support of efficiency and social goals, or alternately, if not properly managed, could cause unanticipated or damaging outcomes. In preparation for the future, transportation strategies need to actively engage with these new technologies to produce positive outcomes and unlock long-standing transportation dilemmas and transform land use, development patterns and the public realm in urban and suburban centers and around major transportation hubs. These strategies and techniques will include: • Pricing for roads and transit based on dynamic data-system that relieve congestion on roads and increase transit ridership; •

Incorporating mode choices and realtime travel information in-app or online that help consumers to make better travel decisions;

Integrate and regulate transportation network companies

Incorporate modes choices and real-time travel information in app or online

Employ dynamic intermodal pricing for roads and transit

Incentivize and regulate AVs & EVs for passenger travel and goods movement

•

Integrating ride-sharing and transit services that solve the first and last leg problem, overcome the detours of drivers and facilitate matching process;

•

Incentivizing AVs and EVs for on-demand transportation, and

•

Improving access for disadvantaged groups, and

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•

Transforming land currently devoted to travel lanes and on- and off-street parking into improved public spaces and other uses.

Sustained, Reliable and Multi-Year Investments We need to proactively think and plan for what’s happening in the next 20-30 years. Major transportation projects often take as long as 10 years to begin construction, requiring a long-term outlook. Now, every metropolitan region in the U.S is required to adopt a 5-year long-range transportation investment plan and virtually every OECD country has a national long-range plan. In 1991 the US Congress adopted the Transportation Equity Act (ISTEA), which outlined broad goals and categories of investments, and since then the Congress has adopted several other five-year funding authorizations. Investing in Canada: However, not since 1956 has the United States had anything $180 + billion over 12 years approaching the kind of long-range investment strategy found in virtually every other developed country. Examples of long-range plans from our OECD counterparts include Invest in Canada, the European Union’s TEN-T continental plan for major road and rail links, and the UK’s National Infrastructure Delivery Plan. The Canadian Invest in Canada plan proposes that more than $180 billion be invested in the nation’s infrastructure over 12 years and authorizes a new delivery entity responsible for the overall coordination between federal and provincial governments. The Canada Infrastructure Bank also uses federal support to attract private sector and institutional investment for new revenue-generating infrastructure projects in the public interest. The plan creates bilateral agreements with provinces and territories and streamlines the delivery of funding, indicating that the national government will dedicate funding on different geographic scales. Under the integrated bilateral agreements, national government will invest up to 40% of municipal and not-forprofit projects in the provinces; 50% of provincial projects; 75% of projects in the territories and for projects with Indigenous partners; 25% of for-profit private sector projects. Meanwhile, provinces will have to cost-share on municipal projects at a minimum of 33.33% of eligible costs.

TEN-T – Connecting Europe $615 billion from 2014 to 2020

UK National Infrastructure Delivery Plan $680 billion from 2016 to 2021

The European Union’s TEN-T Connecting Europe Plan has facilitated the coordinated development of the TEN-T Core Network of nine core road and rail corridors connecting the EU’s 28-member states (27 following Brexit). The Plan highlights the importance of nodes as an integral part of the network: railroad terminals as key infrastructure for MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

intermodal transport chains as well as urban nodes as the origin and destination of the majority of journeys on the trans-European transport network. The plan utilizes innovative financial instruments, such as European Investment Bank, loans, guarantees and other risk-bearing mechanisms. These instruments are specifically designed to draw private investment into commercially viable TEN-T projects by lowering project risk profiles and engendering confidence among private investors. The UK National Infrastructure Delivery Plan serves a similar role in Britain, identifying networks and projects of national significance. These investments are now seen as being of even greater importance in the post-Brexit era. The NIDP outlines ÂŁ483 billions of investment in over 600 infrastructure projects across the UK, to 2020-21 and beyond. Half of this amount is expected to be provided by the private sector. The Plan also establishes two new public bodies to coordinate delivery of these investments.

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Ten Strategies As America advances into the 21st century, we must revive the dynamism that propelled our growth and investment in transportation infrastructure over the previous one hundred years. Our congealed road networks, inadequate transit options, and clogged logistics hubs are unacceptable barriers to economic prosperity for millions of Americans. We must combat the morass that is our current transportation system by redoubling our commitment to infrastructure and to renewing and improving upon our existing legacy networks. In the following section, we profile ten discrete strategies to help us achieve our goals. Each of these strategies supports one of three objectives that must be achieved to resolve the issues with our aging system and expand it to support the future growth of our nation. Although some strategies are crosscutting, contributing to the achievement of multiple objectives, they are organized by the objective most closely aligned with their outcome. Our objectives are as follows: • • •

Funding – Additional funding and new sources of investment capital will be the essential fuel for the renewal and modernization of our transportation systems. Efficiency – Spending funds responsibly to attain the most utility and best outcomes given all possible constraints. Vision – Promoting the consideration of long-range transportation goals, investments must build upon each other to form a cohesive, equitable, efficient, and comprehensive network.

Funding Increased funding for transportation infrastructure investments must form the basis for our system’s overhaul. Accounting for just 0.62% of GDP, America’s 2016 investment of $115 billion was completely inadequate. Although gauging how much more is required is difficult, there are several important benchmarks that should inform our funding goals. At the very least, America must increase spending to match the funding that other countries in the Organization for Economic Cooperation and Development (OECD) contribute to their transportation infrastructure: 1% of annual GDP is the current average. But even matching the OECD average will not provide the additional funding that the American Society of Civil Engineers (ASCE) estimates is necessary to return America’s transportation systems to a “state-of-good-repair.” Although ambitious, perhaps we should aim even higher. China currently spends 5% of their annual GDP on transportation infrastructure which has supported its growth as an economic superpower with global influence. To remain relevant, the United States needs to push beyond a state of good repair to world class.

There is no definite investment America needs to make but based on these comparisons its seems clear that we should aim to commit significantly more than the OECD Average if we intend to truly transform out system, stimulate the economy, and make America the leader of the world again. The following strategies provide blueprints for how we can gather America’s new transportation funds.

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Efficiency The high cost of American infrastructure procurement and inefficient use of existing systems is unacceptable. While additional funding will be necessary to transform our transportation networks, we must ensure that we use those funds as efficiently as possible by paying construction prices on par to global averages for infrastructure procurement. By maximizing the utility of our funds, the following strategies aim to increase the efficiency of American infrastructure throughout project life-cycles, from project procurement through operations and maintenance, by streamlining delivery processes, creating an outcome-focused investment framework, and leveraging new and emerging technologies. Vision Following on funding and efficiency, our final strategies aim at providing visions for comprehensive and cohesive networks that support individual opportunity and economic growth for every American region and citizen. These strategies will provide the long-term framework for our future transportation networks so that investments made in the short-term converge toward a single unified structure in the long-term.

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STRATEGY 1: UNLOCK GOVERNMENT ACTION All levels of government must take bold actions to invest in infrastructure. To do this, revenues must increase and project-delivery regulations should be streamlined to increase procurement efficiency. Overview All levels of government must make a renewed commitment to returning existing transportation systems to a state of good repair and to investing in the next generation of modern roads, rails, airports, and other infrastructure systems. Realizing that federal funds only go so far, local governments – such as state, regional, or municipalities – must also seek creative means to deliver needed infrastructure on their own. In particular: • The Federal Government must work with states, regions, and the private sector to adopt a widely supported vision for the future of America’s transportation systems. • The Federal Gas Tax must be increased by at least $0.25 in the short term, then transitioned to a vehicle-miles-traveled tax to fully account for the cost of maintaining a national road system. • The Federal Government must provide direct funding or grants for projects that are of national significance or located in underperforming regions.

Indicators + Targets • Friction free • Ennobling and exhilarating • Equitable and accessible • Safe • Carbon Neutral • Smart Growth Stakeholders • House Rules Committee • The Federal Government • Taxpayers Timeline • This rule change can be implemented within a year Scope • National • National Significance • Megaregional • Regional • State • Local • Underserved Community

• Local governments must adopt tolls, taxes, fares, and fees and seek creative financing or credit enhancement if necessary. • All levels of government must streamline permitting, procurement, and accounting procedures to remove the current administrative and financial burden that these impose on infrastructure projects. The Federal Government Fixing the United States’ transportation infrastructure will require a widely circulated and agreed upon vision for what the future of American transportation must look like. While this is a Federal responsibility, the visioning process must include input from states and regional governments, as well

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as the private sectors. A diverse set of viewpoints will help to create a vision that builds consensus and lays the groundwork for a future transportation network that will meet the needs of all Americans. Achieving a transformation transportation vision will require commitment from all levels of government, At the Federal level, it will require that Congress refinance the national Highway Trust Fund to support new and innovative national projects. The Trust Fund has been largely level-funded for the last quarter century by a $0.183/gallon tax on gasoline and $0.243/gallon diesel tax. When this tax was increased to pay for the construction of the Interstate highway system in the 1950s, these federal fuel taxes represented 20% of the cost of a gallon of gasoline. Today’s $0.183/gallon federal tax represents only 6% of the cost of a gallon of gasoline. It has been a long time since this tax was increased and today the United States Chamber of Commerce, which is generally opposed to any federal tax increases, has proposed that the federal gas tax be increased by $0.25/gallon. This additional revenue would generate $394 billion in additional transportation funds over the next decade. In the long term, as vehicles become more fuel efficient and as electric vehicles are more widely adopted, Federal and state governments should move to a VMT (vehicle miles traveled). The goal should be to bring federal funding for infrastructure to a level comparable to other OECD nations while incentivizing compact living and the use of public transit (Bradley 2018).20 However, there is no avoiding the fact that the availability of recent funding for transportation investments has been hampered by the larger political gridlock around taxes and discretionary spending in Washington. When the United States’ last made a major commitment to transforming its national infrastructure with the construction of the Interstate Highways, discretionary spending (the portion of the budget Congress can freely allocate) accounted for half of the federal budget. Today, non-defense discretionary spending as a percentage of GDP is set to fall to its lowest level ever, limiting investments at home (Greenstein, Friedman and Shapiro 2017).21 This problem is solvable, but it will take bipartisan action by Congress. One reason that Congress was able to act so definitively in previous years was due to the ability to use earmark funding as a negotiating tool. The passage of early Intermodal Surface Transportation Efficiency Acts (ISTEA) was often eased by including designated spending for congressional districts to secure support. However, since the early 2010s earmarks have not been allowed and bipartisan interest in transportation infrastructure has waned (Walsh, et al. 2018).22 We recognize that reversing four decades of disinvestment in American transportation infrastructure systems will be difficult to achieve and will require a return to bipartisan agreement in Congress for these investments. The funding and financing measures proposed in this report call for much of these Bradley, N., Here’s What You Need to Know about the Gas Tax, Above the Fold, The U.S. Chamber of Bradley, Neil. 2018. "Here’s What You Need to Know about the Gas Tax." U.S. Chamber of Commerce. April 17. https://www.uschamber.com/series/above-the-fold/here-s-what-you-need-know-about-the-gas-tax. 21 Greenstein, Robert, Joel Friedman, and Isaac Shapiro. 2017. "Program Spending as a Percent of GDP Historically Low Outside Social Security and Medicare, and Projected to Fall Further." Center on Budget and Policy Priorities. February 21. https://www.cbpp.org/research/federal-budget/program-spending-as-a-percent-of-gdp-historically-low-outside-social. 22 Walsh, James T., Melanie Sloan, Rich Gold, and Craig Holman. 2018. "The case for restoring earmarks." The Washington Post, January 23. https://www.washingtonpost.com/opinions/the-case-for-restoring-earmarks/2018/01/23/6840063cffc7-11e78acfad2991367d9d_story.html?noredirect=on&utm_term=.ebf6ba6f2768. 20

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resources to be generated through user fees, whereby drivers, transit riders, and businesses will pay for the improved transportation services from which they directly benefit. This approach should be palatable to both political parties and if done right, the responsibility should not rest entirely on the Federal government. Nonetheless, smart investments and strong leadership on this issue at the Federal level will incentivize and encourage local governments to share the burden. To do this we propose that the House Rules Committee allow members of Congress be able to lobby for congressionally dedicated pre-development and planning funding for projects by targeted by Metropolitan Planning Organizations (MPO) in their home districts. At the same time, USDOT must relax or eliminate regulations requiring that MPOs’ long-range transportation plans be fiscally constrained. Planning is a time for creative problem solving and should not be limited from the beginning. Designated Federal pre-development and planning funding would be used for feasibility studies, stakeholder and community mobilization, financial engineering, business plans, technical specifications and procurement procedures (The Executive Agency for Small and Medium-Sized Enterprises n.d.).23 As a more fiduciarily-responsible version of the historic earmark, it would still allow Congress to negotiate over funding for their home districts and to speed up the delivery of projects that have already been identified as high priorities. The creation of a feasible business plan for an infrastructure project is often the riskiest for a local government to take on. At that point in the infrastructure development process, there is no firm idea as to if the project can be built, what its economic impact might be, or even what the project should look like. For the local government, there is no guaranteed return, and they may spend millions of dollars only to discover that a project is not currently feasible. For small localities, the cost of studying a large economy-changing infrastructure project or bringing in the experts necessary to create a P3 project can be a barrier to entry. Of course, using these congressionally designated planning funds is only part of the equation to unlocking the needed federal infrastructure funding. Congress must still be expected to specifically fund projects of national significance or scope and projects in bypassed regions where local governments do not have the funds to do so themselves. These projects should be funded with specific earmarks and must be identified as priorities by the Administration to be allowed under the current Congressional ban on earmarks (Davis 2017).24 Projects like Gateway in New York City, Nextgen Air Traffic Control, or the Inland

Figure 17. The tunnels connecting New York to New Jersey help support over 20% of the United States' GDP. The Gateway Project, to replace and update these tunnels should be seen as a national priority and receive substantial federal funding. Image Source: Amtrak

The Executive Agency for Small and Medium-Sized Enterprises. n.d. "Project Development Assistance (PDA)." European Commission. https://ec.europa.eu/easme/en/project-development-assistance-pda. 24 Davis, Jeff. 2017. "Is the Mass Transit “New Starts” Program Fundamentally Flawed – and Can Congress Fix It Without Earmarks?" Eno Center for Transportation. August 9. https://www.enotrans.org/article/mass-transit-new-starts-programfundamentally-flawed-can-congress-fix-without-earmarks/. 23

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Waterwayâ€™s lock systems represent solutions for bottlenecks that currently limit national productivity. These projects need to be prioritized by the President because they are limiting national productivity and need immediate solutions. Local Governments Increasingly funding for infrastructure must be provided at the local level, whether that be by state, regional, or municipal governments. Many creative financing and project development strategies will be discussed further in this report, but many if not all must start with strong leadership at the local level. Whether it be Union Station in Denver, or the new Tappan Zee Bridge in New York state, strong political and technical leadership is what made this value-creating projects possible. However, funding remains an issue that must be solved to give local governments the needed freedom and autonomy to develop their own assets. In many cases, residents have been willing to step up and fund infrastructure improvements. In Los Angeles County, residents recently voted for Measure M, creating a permanent sales tax to pay for upgrades to their public transportation infrastructure. Governments must be willing to go to their people for support, and citizens must be made aware that quality service has a cost. Creating additional revenue streams also allows cities to seek out public or private financing. Whether it be a bond issuance or bringing in a partner from the private sector, when a revenue stream is created, opportunity is unlocked. However, sometimes just having a revenue stream is not enough. In a competitive market, many cities, regions, or even states may find it difficult to attract the amount of capital that they need due to elevated risks and high-interest rates. In these cases, it falls to the nexthigher level of government to help with credit enhancement to ensure access to low-interest financing. For a local municipality, credit enhancement may come from state backing, but for some states like Illinois, the Federal Government will almost certainly have to provide some sort of guarantee to make financing feasible. Finally, local governments must take control of their own infrastructure. They can not expect completeFederal funding and still expect to retain complete control over the project. This means that the states specifically need to pass enabling legislation for the use of creative procurement strategies and to relax the regulatory requirements that slow projects down where possible. Streamlining project delivery and permitting a variety of procurement methods allows projects to be delivered more efficiently and at a lower cost. For its own part, the Federal Government needs to revisit its regulatory requirements for its funding. While NEPA serves a valuable role in protecting natural assets, in practice it is often used by opposition groups to delay needed projects and to add costs. Any political changes that streamline the approvals process make local participation in infrastructure development that much more feasible. Benefits and Outcomes This strategy acknowledges the long-standing problem of excessive federal deficits and limits on discretionary federal spending. For this reason, we propose that the dedicated Highway Trust Fund be expanded through increased fuel excise taxes, and in the longer term through a national VMT fee and/or a carbon tax. Furthermore, the goal should be to have every federal dollar be leveraged several

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times over with state, local and private commitments, financed through increased taxes, fares, fees, and tolls. We also seek to incentivize the adoption of major new infrastructure legislation through “new earmarks” for feasibility studies and financial plans and business case analyses for priority infrastructure projects in their districts. These studies can be used to build public and political support for these investments, further encouraging members of Congress to support including them in future federal funding legislation. Finally, to support the needed increase in local government funding for infrastructure, the Federal government (especially) must be willing to help with credit enhancement where needed. Example/Case Study A great example of how federal pre-development funding can expedite an MPO targeted project is the expansion of the BoulderDenver Turnpike (US 36). Originally built in the 1950s, the road had become increasingly congested as more interchanges were added over the years. The Colorado Department of Transportation developed a plan for the highway’s expansion in the 2000s but quickly ran into delivery Figure 18. The Flatiron Flyer provides Bus Rapid Transit (BRT) service along the Boulderissues as the state was only Denver Turnpike, a project made possible by federal funding for planning and business plan development. Image Source: Commuting Solutions able to allocate funding for the $550 million in the later years of the MPO’s fiscally-constrained 2035 long-range plan. However, a US DOT challenge grant was awarded in 2009, and this money was used to create a business plan and to develop further applications for federal money. As such, the project was able to acquire TIFIA loans, as well as additional funding from the Denver Regional Transit District, and the Denver Regional Council of Governments. The additional money allowed for them to further consider a P3 delivery model to expedite the project’s delivery date. The expanded highway, including Bus Rapid Transportation infrastructure, opened in 2014 (US Department of Housing and Urban Development 2015).25 Conclusion Increased federal funding for transportation infrastructure will be essential to sustaining America’s prosperity and security. A major increase of the federal fuels excise tax and other measures will be needed to achieve this goal. A new program of earmarks for feasibility studies of major investments in US Department of Housing and Urban Development. 2015. "Build America Investment Initiative: Federal Resource Guide for Infrastructure Planning and Design." https://www.hud.gov/sites/documents/BAINFRARESGUIDEMAY2015.PDF. 25

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Congressional districts can help build public and political support for these investments and the increased taxes needed to pay for them. Funding for infrastructure planning and pre-development represents an undercapitalized area of the overall infrastructure development process. A larger investment in this area can be used to expedite projects, seek creative financing, and deliver projects more efficiently. Most importantly, it gives federal lawmakers a direct hand in the delivery of infrastructure projects in their home districts and creates a valuable negotiating tool in the passage of large-scale funding measures. At the same time, the Federal Government must be willing to fund projects of national significance and projects of national scope, where there is a large GDP impact. However, the Federal government can not be expected to do all the work, and local governments must step up to fund their own share of the infrastructure through tolls, taxes, fares, and fees.

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STRATEGY 2: PAY THE ACTUAL COST OF CONGESTION Drivers must pay the true cost of traffic. Lanes on highways and streets should be reclaimed for more efficient travel and drivers will be charged based on the actual cost of congestion. Overview Automobiles dominate U.S. transportation infrastructure - the vast majority of Americans drive to work and other destinations, and nine out of ten drive alone.26 This reliance on personal vehicles must be addressed, as the roadway system is now seven decades old and lacks the capacity to handle current traffic volumes. America’s roads are congealed and hindering our national competitiveness. It is time for drivers to pay the actual cost of congestion. This strategy calls for creation of congestion management systems to address everworsening traffic jams, by reclaiming lanes for more efficient use, and deploying user-pays fees and charging roadways as a utility. The revenue generated will funnel to capital and operating subsidies for transit alternatives, setting in motion a virtuous cycle of transportation efficiency. The Solution Charging the true cost of congestion will be achieved through a variety of strategies: increased gas taxes, create a new VMT fee system, and expanded tolling. The federal government should raise the gas tax, which has stagnated at the same rate (18.3 cents per gallon) since 1993.27 The disbursement of funds allows highways to receive approximately 84 percent of revenue; the remaining funds are allocated for transit or surface transportation uses. A component of charging the actual cost of congestion should be redistributing the gas tax revenues towards providing

Indicators + Targets • Reclaims existing lanes towards more efficient travel • Secures additional funding toward transit and other infrastructure • Reduces roadway congestion • Promotes positive, denser land use by incentivizing automobile alternatives Goals • Friction free • Equitable and accessible • Carbon Neutral Stakeholders • Federal, regional, governments

and/or

local

Timeline • Within 5 years: expanded application of HOT lanes and variable pricing • Within 10 years: integrated pricing mechanisms with new technology more appropriately charge drivers for impacts; funding is used towards impactful multimodal transportation projects • 10+ years: Road pricing crosssubsidizes better, more competitive transit service; congestion and VMT are reduced

Scope • National • Megaregional • Regional • State • Local 26 U.S. Census Bureau, 2011-2015 American Community Survey 5-Year Estimates. https://factfinder.census.gov/ Kirk, Robert S., and William J. Mallett. Funding and financing highways and public transportation. Congressional Research Service, 2012. https://fas.org/sgp/crs/misc/R44674.pdf 27

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a greater share of transit funding, as transit ridership helps mitigate congestion and reflects more efficient surface transportation. The gas tax charges congestion based on car usage generally but, as vehicles become increasingly fuel efficient, the federal government should identify strategies to transition to vehicle miles traveled (VMT) fee system as an alternative to gasoline and diesel taxes and to better capture and charge proportionate to usage of infrastructure. A VMT fee system charges drivers the true cost of their use of the roads based on driving distance. Proposals to transition to VMT based programs are in development and under review at various levels of government, including national. A VMT pilot initiative has been implemented in Oregon and is in a research phase along the I-95 corridor in the Mid-Atlantic region. Implementing “pay to use” charges is a three-pronged approach that addresses congestion and disincentivizes driving at three levels. An increase to the gas tax charges drivers the true cost of driving, generally, and accounts for the 25 years of economic changes since the tax rate was last updated. A VMT fee system complements the gas tax by charging drivers the true cost of their driving, controlling for fuel-efficiency-related variables. The third component of this strategy is the implementation of congestion-related tolling, which charges drivers the true cost of traffic based on variables related to congestion levels, such as time of day or peak hours, high-demand corridors, and vehicle occupancy. Highways in the U.S. employ this type of tolling to reduce congestion during peak periods. These systems charge tolls at a level needed to prevent congestion based on factors such as time of day (peak versus off-peak), congestion, and vehicle occupancy. By charging for use of some or all lanes of highways, congestion pricing is able to shift some rush hour travelers to other transportation modes or to off-peak hours. By removing some portion of the vehicles from a congested roadway, pricing produces a much more efficient flow of traffic on the system, enabling a greater number of cars to travel through the same roadways. It is critical that these approaches are used through reclaiming existing lanes rather than adding built capacity to highways. Paying the Actual Cost of Congestion works in a variety of scales, ranging from local to national projects. A federal program for introducing a VMT fee system and expanding congestion tolling is a more appropriate and proportionate method to generate funding than the current gas tax as it charges users for their travel and relates to the streets and roadways they actually use. At the megaregional or regional scale, a congestion management system can target severe congestion and local issues with pricing schemes and use this revenue to cross-subsidize high-quality transportation service. This strategy aims to implement “pay to use” charges that are based on the true cost of driving and of traffic. Benefits and Outcomes A primary benefit of charging the true cost of driving is the ability to secure funding to allocate towards transit and other, more sustainable and equitable, modes. This cross-subsidization and greater flexibility between modes is discussed at length in Strategy 8: Optimize the System. The benefit of increased charges for roadways use is the reduction of an unsustainable subsidy for drivers and the production of revenue to fund important transportation improvements. In domestic

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and international cities, congestion pricing - through taxes, fees, and tolling - has consistently produced benefits for a host of concerned parties including drivers, businesses, transit riders, and governments, as well as many other parties. • • •

•

At a national level, the programs generate additional funding to be allocated for the most effective transportation infrastructure investments. On a local level, the schemes reduce congestion by disincentivizing automobile travel and thereby optimizing the entire system. A the individual level, drivers and business owners benefit from reduced delays and stress, producing more reliable travel times, and enabling businesses to send and receive more frequent and reliable deliveries. Mass transit also benefits from access to increased revenue, increased reliability and transit speeds, and higher ridership due to mode shift among drivers.

Example / Case Study One example of this approach is seen in the use high-occupancy tolling or HOT lanes. These lanes are available to vehicles with multiple passengers at no cost and offered at-cost to singleoccupant vehicles. In this way, drivers can opt in to a higher-quality and more efficient service by paying a toll. HOT Lanes are deployed throughout the country, including on I-580 in California (pictured). The I-580 HOT lanes are active between peak hours of 5am and 8pm. Free access Figure 19 HOT lanes on I-580 in California. Gary Reyes, The Mercury News is granted to cars with a minimum of two passengers, and all other vehicles are welcome to use the lane provided drivers pay a fee to travel. In addition to charging based on occupancy, the toll price is calculated based on congestion levels and subject to change every three minutes. I-580 serves as a precedent for automated toll collection systems which make it easy to implement congestion management systems on virtually any street or highway. A plan for integrating real-time data into congestion tolling and pricing is more fully demonstrated in Strategy 6: Develop Dynamic Data and Traffic Management Platforms. Conclusion A comprehensive congestion management system requires new taxes, including an increase to the federal gas tax and the introduction of a VMT fee system, as well as new tolls, particularly dynamic tolling, to charge drivers the true cost of traffic. In the U.S., many major metropolitan areas are wellsituated for application of congestion toll pricing. The cities of New York, Seattle, and San Francisco have proposed congestion pricing as a method to reduce congestion, incentivize alternative

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transportation, and generate funding for infrastructure investment. Once derided as “Lexus Lanes” favoring well-to-do drivers, the reality is that drivers from every economic group benefit from the assured travel times produced by this system. Many of the drivers using priced lanes are parents getting to day care at the end of the day, shift workers who need to clock into work, or drivers from every economic group who need to get to a doctor or dentist appointment on time.

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STRATEGY 3: Create and Capture Value Maximize development potential around transit hubs and rail stations to increase property values and create development opportunity, thereby capturing value to finance projects and make them possible. Overview After decades of disinvestment in most American cities, a renewed interest in urban centers has created new focus on the economic potential of American cities. Cities like L.A. and Denver are creating transportation systems from scratch, with new and revitalized transportation networks appearing all over the country. By focusing on train stations as a focal point for value creation, cities can propose new transit systems and public realm improvements to be financed through capturing a portion of the value created.

Indicators + Targets • Capture Value to Finance Projects • Reinvigorate underutilized space Goals: • Ennobling and exhilarating • Equitable and accessible • Carbon Neutral • Smart Growth Stakeholders • Federal Government • Local Municipality • Private Developers and Investors Timeline • Within 5 years: new developments are constructed; value capture ramps up • Within 10 years: Value capture on full build-out of space • 10+: Bonds paid off, terminate or convert payments to separate use

The Solution Value capture is about connecting the benefit of the infrastructure investment with the cost to provide it. Public entities need to identify projects that will create value and determine the appropriate value capture mechanism to effectively capture this value Scope towards servicing debt. Some examples of methods • Local scope, largely affecting residents currently used include (but are not limited to) the and businesses of a specific creation of a TIF district, which can be seen in municipality Denver, a Special Assessment District, as used in San Francisco, or the Payment in lieu of Taxes (PILOT), system being used to finance infrastructure and public spaces at Manhattan’s Hudson Yards. What all of these mechanisms demonstrate, is the need to clearly define the area for which value capture is to occur. For cities like Denver and San Francisco, where there is an apparent “hole” in the city’s development, this can be straightforward. Alternatively, funding for London’s Crossrail, came in part from a citywide Business Rate Supplement, specifically levied on larger businesses, to fund the project, as a smaller, neighborhood scope was not appropriate. At the same time, we need to create a dedicated federal funding source to finance a portion of infrastructure projects up-front, based on the opportunity to capture future value. This will take some of the burden off local municipalities for initial costs.

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Typically, value capture studies are projected over a period of 30 to 45 years, depending on the terms of the bond issued. Since annual payments, fees, or tax increments go towards paying back the bond, value capture essentially funds the annual debt payments. Depending on the success of the project, the timeline can vary. In Denver, for example, actual revenues have far outpaced projections, allowing the city to refinance and pay back their debt service early.28 Hudson Yards, on the other hand, has had delays in construction due to the economic downturn, translating to an underperformance from PILOT fees. With additional time needed for a full build-out, Hudson Yards will require more time to generate the full scope of value to be captured.29 Benefits and Outcomes Value Capture creates an alternative funding source for infrastructure projects, while also improving transit and the public realm. Through improved spaces, neighborhoods are revitalized, and new housing markets are established. Lastly, it brings both public and private stakeholders into a project, increasing the likelihood of success. Precedents Project Examples

Project Description

Total Project Projected Cost Value Capture

Leverage Enabled by Value Capture

Denver Union Station Rail and Bus Transit $484 million (2014 Completion)30 Center; Parks; Public Space; Historic Building Renovation

Yearly $155 million RRIF Projection: Loan $3.9 million; Actual: $13 million (*2016)

New York Hudson Yards Extension of No. 7 $3.8 billion (2005 start, ongoing) Line; Public Space; Railyard Cap; Street Extension; Javits Center Renovation

Yearly $3 billion in bonds Projection: $98.6- $130 million Actual: $75.5 million (*annual average 20062016)

John Murray, “Denver plans to repay Union Station debt sooner, and RTD says it will save $134 million,” The Denver Post, February 9, 2017. 29Giovanella Quintanilla Re, “As Hudson Yards Refinances Old Debt,” New York City Independent Budget Office, June 2017. 30 John Murray, “Denver.” Chrissy Mancini Nichols. “Value Capture Case Studies: Denver’s Historic Union Station,” Metropolitan Planning Council, April 19, 2012. 28

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Conclusion The major challenges of value capture include having an active development community who is willing to work with the municipality, clearly defining the district affected by the new infrastructure, and the need to assess/re-assess land values in order to capture all added value. However, with the right framework and stakeholders involved, it can tap into private resources in ways that other financing strategies cannot.

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STRATEGY 4: Provide Public Benefits Using Public Finance Authorities (PFAs) Communities across the United States should establish new public finance authorities (PFAs) similar to California’s Enhanced Infrastructure Financing Districts (EIFDs), that can finance and deliver infrastructure investments. This will provide a path for the creation of a market with sustained “deal flow” for large-scale private sector funding and direct public funding of infrastructure and economic development. By gathering and aligning funding from all geographies and parties that benefit from a project, PFAs can work with infrastructure banks to attract better financing with a clear projection of cash flows. Public Finance Authorities have the potential to grow their impacts by raising money more effectively to achieve public policy goals and match Federal funds when appropriate. Overview Public finance authorities are tax-exempt bond issuing authorities established by municipal, county or regional governments that are uniquely qualified to streamline and deliver economic development projects. Today, in most of the country local and regional governments are unable to coordinate projects spanning multiple jurisdictions. PFAs help solve this problem by encouraging inter-jurisdictional collaboration.

Indicators + Targets • • •

Secures capital for projects Achieves policy objectives Streamlines interjurisdictional collaboration

Goals • •

Friction free Equitable and accessible

Stakeholders • • •

Local governing bodies States Banks and other funders and financiers

Timeline • •

Within 1-2 years, create legislative authorization in 50 states Within 3-5 years, deploy federal incentives for PFAs

Scope

PFAs can solve a number of problems now facing • National local and some regional governments. Among these • National Significance are the following: • Megaregional • Financing: Utilizing a range of taxes, tolls, fares • Regional and fees, including value capture techniques and • State user fees needed to finance projects; • Local • Working across political boundaries: Working at • Underserved Community the scale of regional transportation systems, which usually encompass a number of municipalities, and in some cases, multiple states; • Attracting necessary talent: Developing sufficient scale and expertise to attract and retain experts in financing, planning and project management and delivery. • Long-term outlook: Insulating projects from day-to-day politics during the multi-year period required to deliver major infrastructure projects. • Partnering with state and federal agencies: PFAs can generate the funds needed to attract matching state and federal grant and loan funding for major projects.

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Regional infrastructure banks, entities that arrange direct loans by offering below-market interest rates and credit enhancement for infrastructure development, are gaining popularity in an effort to establish revolving funds targeting infrastructure improvements. Infrastructure banks complement PFAs and help to gather matching funds from Federal and State entities to streamline the way that projects are capitalized. California has pioneered progress with PFAs in recent years with its Enhanced Infrastructure Financing Districts, authorized by Senate Bill No. 628 in 2013-2014. These Districts, designed to rehabilitate public infrastructure and private facilities, allow communities to fund improvements with tax increment financing (TIF) and from city, county, special district taxing agencies with their consent. The Solution PFAs already exist in a handful of places across the country, but they need to be universally available and incentivized across the United States. By establishing PFAs, state and/or local agencies will create a unified funding structure that will be able to attract new investment. PFAs unlock new funding sources for large-scale projects and increase wealth in communities. They also allow the participating jurisdictions to realize specific policy goals and create greater efficiencies in the streamlining of project funding. The Congress should also adopt legislation enabling creation of multi-state PFAs in regions that span two or more states, without the need for additional congressional authorization. PFAs can work at the neighborhood level or on a much larger regional scale and require the cooperation of relevant political bodies across this larger geography. PFAs can mobilize both public sector agencies and private sector lending institutions to raise capital for projects. Benefits and Outcomes PFAs will ensure a faster, more efficient delivery of infrastructure projects. Example / Case Study California has implemented enhanced infrastructure financing districts, a form of PFAs, to build infrastructure projects like the West Sacramento Bridge; here the PFA was established to build a new bridge connecting West Sacramento and Sacramento. West Sacramentoâ€™s Bridge District uses creative financing to plan and deliver infrastructure projects supporting Figure 20 West Sacramento Enhanced Infrastructure Finance District, a form of economic development. It will use PFA used to finance four new bridges spanning the Sacramento River. Planetizen. property tax revenues generated by 4,000 new housing units and 5 million square feet of commercial and retail space, to be completed by 2035, to finance infrastructure improvements and public realm improvements. There was

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widespread community support for the plan, demonstrating a strong partnership between the city and property owners. Conclusion PFAs can finance and build important infrastructure projects and have the potential to reduce project costs.

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STRATEGY 5: Streamline Project Delivery Combine multiple project delivery methods to expedite project implementation, streamline costs, and improve outcomes. Overview Over the last several decades, we have neglected upkeep and new investments, losing the capacity to deliver complex projects efficiently and effectively. Today’s most complex projects routinely miss deadlines and run over-budget as a result. We identified three major problems that hinder the efficiency and effectiveness of project delivery. Firstly, cumbersome permitting has increased project delivery length. Especially, the National Environmental Protection Act (NEPA) emerged as the predominant cause of excessive delays and costs related to regulation of project delivery. Besides, traditional design-bid-build strategies does not work well when projects increase in scale and complex, leading to ineffective project procurement. Meanwhile, regulatory barriers to alternative procurement strategies impede the widespread adoption of creative and effective models, such as design-build (DB) and design-build-operate-maintain (DBOM). Otherwise, outdated labor practice resulted in that project costs in the U.S. are the highest in the world. Mitigating these problems now, and preventing them from interfering in the future, is vitally important as there will be a time when the populous’ demand for new infrastructure will be too great to ignore and politicians will need the tools to swiftly implement a new national infrastructure program.

Indicators + Targets • Reduce costs and length of regulatory approvals • Deliver projects on time and on budget • Attract private capital • Share costs with private entities Goals • Friction free Stakeholders • Federal government • State government • Private investors Timeline • D-B, P3s are authorized in all the states within 5 years Scope It could be applied to projects at all level • National • National Significance • Megaregional • Regional • State • Local • Underserved Community

The Solution To minimize the regulatory barriers and prevent cumbersome permitting, federal government needs to streamline permitting and cut red tape, which requires agencies to establish review schedules that maximize simultaneous processes when appropriate.

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Although DB, DBOM and publicprivate partnership authorization is spreading, many states still prohibit or limit the use of these proven strategies for efficient infrastructure delivery. At the state level, there needs to be an expansion of design-build and public-private partnership enabling legislation generally. We should instead be enabling it with regulatory reform and possibly via even more proactive measures. There are a multitude of options for governments to consider when choosing procurement strategies. A design-build project Figure 21 2018 Design-Build State Authorization sources both design and construction to one firm, or consortium of firms working together. This makes value engineering easier and mitigates design and management risks that the government would have to carry when transitioning from designing to construction under standard procurement methods. Public-Private Partnerships are an increasingly used in infrastructure procurement in the United States. They should be considered for every project that entails extended management responsibility for a complex multi-phase delivery31. Separating issues like political partisanship and term limits from the delivery of needed infrastructure requires an extra buffer isolating in-progress projects from political interference. While all major infrastructure projects should be planned and authorized with government involvement, too many projects are delayed or aborted due to interference from elected officials or bureaucrats. To prevent this, special purpose delivery entities (often referred to as authorities, corporations, or companies) are established to deliver specific projects to match the scale of the problem with the scope of authority. Special purpose organizations, particularly those who will be contracting with private sector teams, can hire the expertise needed to negotiate contracts and deliver specific projects efficiently. Otherwise, to cut labor costs, project delivery entities should insist on Project Labor Agreements (PLA). PLAs can be used to restrict use of traditional labor practices and work rules that limit productivity and promote “featherbedding.” A Project Labor Agreement was instrumental to the cost saving of nearly $452 million of the replacement of New York State’s Tappan Zee Bridge. Especially, a higher ratio of apprentices to journeypersons than typically allowed in collective bargaining agreements, saving an estimated $59 million32. L.Y. Tang, Q. Shen & E. Cheng, A review of studies on Public-Private Partnership projects in the construction industry, International Journal of Project Management, 2010. 32 "Governor Cuomo Announces Labor Agreement That Will Save Hundreds of Millions of Dollars, Representing a Critical Step Forward in the Tappan Zee Bridge Project." Governor Andrew M. Cuomo. September 29, 2014. 31

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Benefits and Outcomes The primary benefit is reducing costs and length of regulatory approvals. Projects could be delivered on time and on budget. Additionally, innovative project delivery could attract private capital to invest in public infrastructure, which brings together multiple financing sources required for large-scale projects, and also generates risk-sharing benefits. Finally, reductions in the time required to deliver projects will encourage elected officials to support these investments, knowing that they will still be in office for groundbreakings and ribbon-cuttings. Examples /Case Studies The United Kingdom has been an early adopter of both infrastructure delivery entities and public-private partnerships. Infrastructure delivery entities have been utilized for a string of major projects, beginning with the HS1 High Speed Rail Link between the Channel Tunnel and London, followed by the massive redevelopment of Stratford, in East London for the 2012 Summer Olympics. Today the most notable projects utilizing this management format include London Crossrail. Central government and the London local government and transport authority are combined to assemble Figure 22 London Crossrail funding and co-sponsor through special purpose company Crossrail Limited. It developed a Delivery Strategy which defines how the project delivery entity is delivering Crossrail. Especially, because it was set up purely for the purpose of building the project overseen by its own management team, and an independent board of directors which leads the company on a day-to-day basis, it has a significant degree of autonomy33. Project managers and staff are hired, and consultants and construction companies are brought in as needed to deliver the projects. Upon project completion, the infrastructure is either bid out to a concessionaire for operation and/or turned over to the managing agency. The delivery corporation is then terminated, and project staff move on to other endeavors. In each of these cases, projects have been delivered on-time and on-budget. For economic hubs like London, completing projects on time is particularly important, as fixing infrastructure gaps quickly minimizes business disruption and allows for continued GDP growth.

https://www.governor.ny.gov/news/governor-cuomo-announces-labor-agreement-will-save-hundreds-millions-dollarsrepresenting. 33 Tucker, William. "Crossrail project: the execution strategy for delivering Londonâ€™s Elizabeth line." In Proceedings of the Institution of Civil Engineers-Civil Engineering, vol. 170, no. 5, pp. 3-14. Thomas Telford Ltd, 2017.

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Conclusion The benefits of innovative procurement processes like DB and DBOM have become increasingly apparent in recent years. But despite their success rate and popularity, tools to facilitate implementation have not been developed. More work must be done to support the use of these procurement strategies and to update regulations to enable them. As we move forward, we must develop reliable entities and strategies for delivering infrastructure effectively, despite political risks. Special purpose delivery entities are uniquely suited to manage infrastructure delivery in that they are separated from the political process and can call upon industry experts to help guide projects to completion. Delivery entities provide a host of benefits in terms of streamlining project financing and increasing coordination between stakeholders. Furthermore, because of their singular mission and expertise, they are the best-positioned entity to determine appropriate procurement strategies and enter into a Public-Private Partnership.

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STRATEGY 6: Open Data Platforms and Dynamic Traffic Management Develop real-time transportation data platforms to enable empirical decision making, empower transit riders, and inform dynamic traffic management. Overview As we move further into the 21st century, it is imperative that we capitalize on the tremendous wealth of data that new technologies like GPS and smartphones have created. This strategy proposes that US governments coordinate public and private sector data and centralize it into platforms that can be used to improve decision making, empower transit riders, and inform dynamic transportation management. This will require significant public investment for additional remote sensing apparatus to increase data collection, as well as large scale coordination with private sector partners like Google and Uber. But, as is affirmed by the valuation of data-rich tech firms, the investment will be well worth it. The Solution Centralized databases of real-time information will provide value to authorities, users, and the private sector alike: authorities will be able to better assess bottlenecks or the scope of system damage and make proportional investments; users will get better information about the fastest and cheapest routes for their journeys; and private companies like TNCs and freight carriers will have better information to inform their routes, enabling them to move more passengers and cargo faster.

Indicators + Targets • • • •

Improved basis for investment decisions Private partners Traffic Reduction New balance of mode share

Goals: • • • • •

Friction free Equitable and accessible Safe Carbon Neutral Smart Growth

Stakeholders • • •

Federal, State, Local Governments Private transportation providers App developers

Timeline • •

Initial platform within 2 years Significant private sector cooperation and dynamic pricing on highly congested corridors within 5 years

Scope • • • •

National Regional State Local

But once our capacity to collect data has advanced sufficiently, that is when we will really begin to realize the value of big data with the advent of comprehensive dynamic pricing and management systems that use data to manage congestion and promote coordination between modes. Dynamic pricing will play a large role in these new dynamic management systems, charging fees based on the level of traffic on roadways to disincentivize use of congested corridors and maintain free-flowing traffic, but they will also facilitate friction-free intermodal links. Applications drawing on live-data feeds will direct users throughout their journeys, ensuring smooth connections between trains, buses, and shared TNCs.

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

The system will also react dynamically to demand or even begin to anticipate capacity needs as data accretes. At its most basic, this will entail higher prices for low density modes like automobiles when a corridor becomes congested and the dispatch of additional trains or buses on those same corridors to provide additional capacity during peak use periods. As the system grows in sophistication, all sorts of inputs will be incorporated to inform the systemâ€™s dynamics. For example, even a trending hashtag on Twitter for a big event could eventually prompt transit agencies to alter service. Benefits and Outcomes American open data platforms will form the basis for a new era of empirical transportation investment decisions. With the wealth of real-time information these platforms provide, system damage or bottlenecks could be quickly identified and quantified so that investments can be made in proportion to the severity of negative impacts. This added efficiency alone will immediately improve the operation of our existing systems. Beyond these gains though, we will derive even more value as data accretes across years and geographies. Assessments of various investment outcomes will eventually create feedback loops wherein we can identify the most suitable and cost-effective solutions to transportation needs. Another profound impact of accessible real-time information will be its capacity to empower passengers. One of the barriers preventing most travelers from engaging in public transportation are opaque or unreliable transit routes, schedules, and connections. People are far less likely to wait for a bus if they are uncertain about when it will arrive or how long its route will take. Central databases will enable development of sophisticated wayfinding and routing applications that can produce clear directions and metrics for each transportation alternative. The platform will allow users to weigh options and make decisions based on empirical utility rather than incomplete facts. Finally, the benefits from a dynamic traffic management system will be profound. Using dynamic pricing and user interfaces to alter travel behavior, these systems will transfer trips from the most congested modes and corridors to alternatives that can provide a faster and cheaper ride. These systems will integrate all our different modes, linking private vehicles, transit, TNCs, planes, trucks, bicycles, and pedestrian access ways into a single unified network. They will assess all needs and constraints in real-time and spread use across the entire network to ensure that all Americans and the American economy gets the most value possible for every dollar invested in transportation infrastructure.

MOBILIZING INVESTMENT IN AMERICAâ€™S TRANSPORTATION INFRASTRUCTURE

Example / Case Study No transportation open data platforms yet exist on the scale proposed, but this idea is not without precedent. Both the World Bank’s Open Data Partnership and the National Association of City Transportation Officials’ (NACTO) Open Figure 23 Taxi pick-up and drop-off volume. Data from DC FHV. Image via nacto.org. Transport Partnership have advocated for increased sharing of transportation data across sectors and geographies. NACTO’s recently launched SharedStreets platform specifically aims at resolving incompatibility issues between data standards used by private companies and public agencies. The platform acts as a “connector”, standardizing data structures using key data points instead of the complex, often proprietary methods used to obtain them.34 Conclusion Effective and innovative solutions to nearly all needs or problems stem from a repository of relevant information and experience. That is why people attend schools - to store experience problem solving in the field they intend to pursue and to absorb all relevant information that already exists about that field. This collection of information allows them to draw on historic successes or failures and their own experience to develop effective solutions. Now that technology can provide the same capacity on a national scale, our nation would be irresponsible to neglect developing a system to collect, store, and employ transportation data for the maximum benefit. Open data platforms and dynamic traffic management will give America the ability to make the best and most informed decisions about transportation investments and will enable the most efficient and productive use of our existing networks. Beyond these foreseeable outcomes, open data platforms will create a host of benefits that we have yet to conceive. Still in its nascent stages, big data is already creating tremendous value even though its potential has only been marginally tapped by data scientists and private industries. By creating this unified resource, United States governments will supply our industries with the infrastructure they need to innovate and thrive. Like the transcontinental railroad in the 19th century, open data platforms have the potential to unify our business communities and support their production of our next economic revolution.

National Association of City Transportation Officials. 2018. nacto.org. February 22. Accessed April 10, 2018. https://nacto.org/2018/02/22/nacto-and-otp-launch-sharedstreets/.

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MOBILIZING INVESTMENT IN AMERICAâ€™S TRANSPORTATION INFRASTRUCTURE

STRATEGY 7: Get Ahead of New Technology Create dedicated federal funding to incentivize and manage new technologies at all states and localities. Overview In this period of rapid innovation, emerging new technologies offer great opportunities to manage traffic intelligently, operate with reduced environmental impact, serve the first and last leg of travel through on-demand mobility service, and price infrastructure in new ways. However, in doing so, technology also has potential to disrupt the current system. TNCs (transportation network companies like Uber and Lyft), Autonomous Vehicles (AVs), and Electric Vehicles (EVs), while developing at a fast speed, have created congestion and safety issues due to lack of regulation. AVs and EVs are not operating under consistent ownership and operating structures, and variation in how they are taxed from place to place casts doubt on their environmental and equality benefits. As rideshare companies are actively developing and deploying AVs, the full range of impacts must be considered. Moreover, these new technology companies lack universal standards, adding to the challenge of comprehensive sector management. Growing penetration of EVs, AVs, and other new technologies across American markets requires immediate action from Federal actors to institutionalize the adoption and regulation of innovative new systems. While Uber has received $21 Billion in funds from a private investors for its own expansion, no federal, states or local governments are investing noticeably in the rideshare industry. In fact, federal speeding in carpool projects in 2017 was less than 0.01% of its total spending.

Indicators + Targets • • • • • •

Reduced travel time Increased transit ridership Reduced carbon emission Reduced space devoted to parking Increased open space Better priced and financed infrastructure

Goals • • • • •

Friction-free Equitable and accessible Safe Carbon Neutral Smart Growth

Stakeholders • • •

Federal government State and Local government New Technology Companies

Timeline •

•

Within 5 years: Implement dynamic pricing in megaregions, charge TNCs and explore TNCs integration best practice in PFAs Within 10 years: implement TNC integration in states and localities and explore AVs supporting infrastructure in PFAs 10+ implement AVs supporting infrastructure in states and localities and charge AVs and EVs

Scope •

Megaregional, State, Local

In January 2017, the U.S Department of Transportation announced Federal Highway Administration Vehicle to Infrastructure guidance, a support system for AVs and EVs aimed at helping state and local

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governments prepare to accommodate vehicle to infrastructure initiatives and data management. There are wider concerns around he these systems are funded.35 While many of the challenges resulting from rideshare should be addressed at the local level, they represent an issue of national importance. Therefore, it is very important for the federal government to develop policy guiding local and state governments are they navigate the emergence of these new technologies. The Solution In the face of opportunities and challenges brought about by new technologies, we propose to create dedicated federal funding that incentivizes new technologies to be deployed and managed by states and localities. Specifically, these funds will enable small and bypassed regions to adopt new technologies as well. The Federal government should establish steering committees to interface with industry while setting standards and the Secretary of Transportation should oversee development and regulation standards of new technology and create a framework for new technology. The use of these standards at the PFA and local level should be incentivized through funding frameworks outlined at the Federal level. Furthermore, there should be additional incentives for the deployment of interventions that improve social equity. This strategy requires, at a minimum, a 5% federal commitment, with a maximum of 50% of its total cost. We propose three major new technology applications, including: •

Integrating transportation network companies into public transit,

•

Incentivizing supporting infrastructure for AVs & EVs, and

•

Charging TNCs, AVs, and EVs to use public roads.

The integration of TNCs takes advantage of shared rides and the ability to fill first and last legs of travel, as well as an improvement of service quality. AVs and EVs supporting infrastructure includes Vehicle-to-Infrastructure (V2I), a communication model that allows data from infrastructure components to be delivered to the vehicle over an ad hoc network. In an intelligent transportation system, V2I sensors can capture infrastructure data and provide travelers with real-time advisories, ensuring the operation of driverless cars. The availability of data and deployment of new vehicles also make it possible to better price the infrastructure system through user fee per vehicle mile traveled. Many of these new technologies are still in development—and the deployment and management of systems will vary from place to place, meaning impacts will vary. By providing incentives and guidelines for these initiatives, states and localities will develop best practices for new technologies.

“What Is Vehicle to Infrastructure (V2I or v2i)? - Definition from WhatIs.com.” 2018. WhatIs.com. Accessed May 17. https://whatis.techtarget.com/definition/vehicle-to-infrastructure-V2I-or-V2X. 35

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Benefits and Outcomes This strategy will achieve a better quality of life for U.S citizens by reducing traffic congestion, carbon emissions, and required parking capacity. It will also improve transit service quality, air quality, and development patterns. Example / Case Study Although there are no national funds dedicated to new technology deployment, many cities have already started to incorporate them into their transportation system. A good example of this is rideshare integration. In 2015, Atlanta’s transit agency, MARTA, started to cooperate with Uber by integrating its transit App ‘MARTA on the go’ to Uber’s app and providing coupons for MARTA users taking Uber.36 By way of app integration, Uber reported growing the number of dual service travelers in 201537. Similarly, Dallas, TX also cooperates with Lyft.38 Summit, NJ has taken transit-rideshare integration a step further by undertaking a six-month, 100person pilot program in which the city is subsidizing Uber rides to and from its transit station in order to reduce parking demand.39 According to the Wall Street Journal,40 constructing a multi-story garage to accommodate Summit’s current parking deficit would cost approximately $10 million, while Uber subsidies are projected by the city to cost only $167,000 a year for the 100 commuters in the pilot program. In Florida, Altamonte Springs has adopted a broader approach to subsidy by starting with a $500,000 pilot program that subsidizes 20% of costs of riding with Uber and 25% off for those trips to and from SunRail Station.41 This program aims to assess how ridesharing can impact the city’s overall mobility needs. LA Metro and Washington DC & Via42 are also exploring on-demand paratransit that fills the first and last leg.

“7 Ways to Use Uber with MARTA.” 2016. MARTA Guide. July 19. https://martaguide.com/ways-to-use-uber-with-marta/.

“Uber & MARTA: Connecting The Last Mile | Uber Blog Atlanta.” 2018. Uber.com. May 17. https://www.uber.com/blog/atlanta/uber-marta-connecting-the-last-mile/?state=X8_v0Qtv351RVysFX1lSDBMQ09XvA4oZ6VHezB-GS0=&_csid=45XKzTdUnsxkGdnJtQtObQ#_. 37

38“DART,

Lyft Collaborate to Give North Texans More Transit Options.” 2015. DART Daily. October 26. https://dartdallas.dart.org/2015/10/26/dart-lyft-collaborate-to-give-north-texans-more-transit-options/. “How Cities Are Integrating Rideshare and Public Transportation.” 2018. Data-Smart City Solutions. Accessed May 17. https://datasmart.ash.harvard.edu/news/article/how-cities-are-integrating-rideshare-and-public-transportation-978. 40 Fung, Esther. 2017. “New Jersey Town Calls on Uber to Solve Commuter Parking Dilemma.” The Wall Street Journal. Dow Jones & Company. January 1. https://www.wsj.com/articles/new-jersey-town-calls-on-uber-to-solve-commuter-parkingdilemma-1483128663. 41 “Uber and Altamonte Springs Launch Pilot Program to Improve Transportation Access.” 2016. Pennsylvania. March 21. https://newsroom.uber.com/us-florida/altamonte-springs/. 42 Marshall, Aarian. 2017. “LA Metro Looks to Rideshare Companies Like Uber, Lyft, and Chariot to Build the Future of Public Transit.” Wired. Conde Nast. October 24. https://www.wired.com/story/la-rideshare-public-transit/amp. 39

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Pittsburgh and Phoenix are among the cities to make bets on driverless cars. At Florida Polytechnic University, outside Orlando, a $100 million construction on a 400-acre site which includes a test track and simulated urban and rural roadways is underway. Another testing complex in Florida is slated for the Kennedy Space Center, where companies can subject vehicles to hazardous environmental conditions such as flooding, smoke and fog to test performance.43 New York is another city in the process of imposing regulations on new technology. Figure 24 New Mobility Rendering Daimler AG In New York, the City has proposed to impose a surcharge on for-hire vehicles entering a congestion zone (from 60th street south to the Battery) during particularly busy times. 44 New York’s charging on TNCs is not unique; in Chicago, Uber, Lyft, and other ride-hailing services incur of a 15-cent fee to help pay for track, signal and electrical upgrades, thus making the city’s trains run faster and smoother. In Philadelphia, a 1.4 percent tax is imposed on ride-hailing trips which is expected to generate $2.6 million revenue for public schools and more than a million dollars for ride-hailing industry enforcement and regulation this year. The revenue from 20-cent fee per ride-hailing trip in Massachusetts is earmarked to improve roads and bridges and fill a state transportation fund. South Carolina yields more than one million dollars from their one-percent ride-hailing fee for municipalities and counties to spend.45 Conclusion Funding states and localities to support, regulate, and integrate new technologies will help the U.S unlock the transportation dilemma and achieve superior social and environmental outcomes.

Campo-Flores, Arian. 2017. “Cities Rush to Build Infrastructure-for Self-Driving Cars.” The Wall Street Journal. Dow Jones & Company. November 9. https://www.wsj.com/articles/cities-rush-to-build-infrastructurefor-self-driving-cars1510236002. 43

Feinbaum, Bob. 2018. “Adopt Congestion Pricing to Tame SF Traffic.” San Francisco Chronicle. San Francisco Chronicle. February 26. https://www.sfchronicle.com/opinion/openforum/article/Adopt-congestion-pricing-to-tame-SF-traffic12706691.php. 45 Hu, Winnie. 2018. “When Calling an Uber Can Pay Off for Cities and States.” The New York Times. The New York Times. February 18. https://www.nytimes.com/2018/02/18/nyregion/uber-lyft-public-transit-congestion-tax.html. 44

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

STRATEGY 8: OPTIMIZE THE SYSTEM Merge existing transportation silos into single, multimodal entity that pools all revenue and funding and reallocate it towards optimizing the transit system. Overview Our travel patterns involve a mix of modes yet the U.S. funds and manages each independently. Transportation is siloed by mode, and congress decides how and where to spend federal dollars through the use of outdated formulas that fail to account for local conditions, priorities, and goals. We propose merging these silos into a single entity through which transportation funding, decisions, and management operate across modes.

Indicators + Targets

• •

•

Maximizes system efficiency Funding decisions match the scale of the project and account for local context, needs, and goals Prioritizes equitable and sustainable transportation by reallocating revenue from high-demand areas to support less competitive areas/modes

Goals

• • • • •

Friction free Ennobling and exhilarating Equitable and accessible Carbon Neutral Smart Growth

The Solution This strategy proposes the elimination of silos and the creation of a single, multimodal entity that pools transportation-related funding and reallocates it toward optimizing the transportation Stakeholders system. Transportation optimization is founded on • Major stakeholderrs a simple principle: the most efficient mode is that which carries the most riders. To become more Timeline efficient, a network needs to (1) disincentivize • Within 5 years: driving alone and to (2) incentivize transit by • Within 10 years improving transit quality and connectivity, making • 10+ it a more attractive and more efficient option. This entity will be megaregional or regional in scope, Scope with the primary focus of congestion management • Megaregional through improving the quality and connectivity of • Regional its transit infrastructure. By enabling funding • Local decisions to be made at a more localized level, the • Underserved Community funding can be dedicated based on the immediate needs and priorities of the region, rather than prioritizing less efficient modes such as single-occupancy vehicles. Paired with a congestion pricing strategy (Strategies 2 and 6), this entity will have the authority to use revenue generated by tolls, fees, taxes, and fares to cross-subsidize strategic investments aimed at modernizing and optimizing transit systems. In addition to improving efficiency of transportation networks, this entity promotes greater equity by using the profits from high-demand, high-value services (such as congested urban highways or high-speed rail) to support service in less competitive markets (rural or otherwise marginalized areas). Cross-subsidies could also be used to cut fares for

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

bus and rapid transit riders who typically have lower incomes than automobile drivers. For example, in Los Angeles the median income of individuals who drive to work more than double the income of those who commute via transit (median incomes of $36,033 and $17,334 respectively). 46 In addition to facilitating cross-subsidization, housing all transportation management and funding in one entity also allows for better cross-promotion or utilization. The integration of open data policies (strategy nine) can provide the information toward rethinking the network and improving intermodal connections. With real-time information, traditional transit becomes more a more reliable option for commuters. Streamlined logistics through initiatives such as Los Angeles METRO’s microtransit program allow for short-haul trips to be consolidated and planned in the most efficient route. For example, at LAX, when arriving visitors request a Lyft or other ride-sharing service, they are directed to a predetermined meeting point.47 The app then coordinates trips and arranges passenger pick-up based on proximity of destinations. A second example program pool,transit and allocated illustrating the cross-promotion of shared trips and is toward optimizing the entire transportation network. PennDesign by integrating ride-sharing as a free service for first and lastleg trips. This type of program is already in place in the states of California, Colorado, Massachusetts, Washington, and Pennsylvania.48 Benefits and Outcomes Eliminating modal silos to establish a single transportation Figure 25 Source: LA Time entity is beneficial by making optimal use of the entire system and maximizes efficiency. It streamlines the funding and management process by coordinating strategic investments and comprehensive projects across all modes. Funding secured from dynamic pricing not only discourages drivers from single-occupant trips, but is used to fund better, more efficient transit and encourage ridership on more sustainable modes. This strategy is most valuable in combination with three other key strategies: Pay the Actual Cost of Congestion, Develop Dynamic Data and Tolling Management Platforms, and Harness New Technology. The funding pool benefits through the revenue

U.S. Census Bureau, 2011-2015 American Community Survey 5-Year Estimates. https://factfinder.census.gov/ Erskine, Chris, “LAX now allowing Uber and Lyft drivers to drop off, then pick up, on same trip,”The Los Angeles Times, August 30, 2017, http://www.latimes.com/travel/deals/la-tr-uber-lyft-20170829-story.html 48 Lyft, “Friends with transit.” https://take.lyft.com/friendswithtransit/ 46 47

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generated by paying the price of traffic, and shared decision making facilitated by a single entity allows the entire network to benefit from advances in new technology and dynamic data. Example / Case Study Bus Toll Lanes in Florida In Florida, the Tampa Hillsborough Expressway Authority and Hillsborough Area Regional Transit collaborated on concept development for “bus toll lanes” or BTL. These lanes reclaim existing lanes and are situated as an expressway that prioritizes transit but allows personal vehicles to access the BLT through dynamic pricing - “the remaining road space is sold to drivers at toll fees designed to eliminate congestion and maintain high speeds and steady flow.”49 This sharing of space and of revenue toward a more efficient roadway reflects outcomes and goals of cross-subsidizing transportation Figure 26 Source: City Lab services and optimizing the system.

Jaffe, Eric, “Finally, a Plan to Pay for Public Transit With Highway Tolls,” CityLab, July 23, 2013, https://www.citylab.com/transportation/2013/07/finally-plan-pay-public-transit-highway-tolls/6287/ 49

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MOBILIZING INVESTMENT IN AMERICAâ€™S TRANSPORTATION INFRASTRUCTURE

STRATEGY 9: Invest in Logistics Invest in logistics and supply chain using PFAs

Overview Logistics and supply chains play an increasingly large role in the America’s economy. From an economic standpoint, approximately one-quarter of the jobs in the country are associated with freight and goods movement.50 Hence, a robust and reliable freight transport network, including freight rail, inland waterways, and trucking, is critical for the nation’s economy. Problems crippling the logistics and supply chain systems include severe congestion and bottlenecks, lack of capacity at intermodal facilities, and outdated legacy systems. In addition, there is environmental and NIMBY (not in my backyard) opposition to highway and rail expansion projects. Many of the freight transport infrastructure systems operate across multiple political jurisdictions and are in need of major investment, requiring crossjurisdictional collaboration.

Indicators + Targets • Fewer chokepoints and bottlenecks • Sufficient capacity in the current transportation system to meet growing freight demand • Reduction of environmental impact and increased road safety • Increased supply chain efficiency and strengthened national competitiveness

Goals • • • • • •

Ennobling and exhilarating Equitable and accessible Safe Carbon Neutral Smart Growth Energy Efficiency

Stakeholders • Different levels of government • Shippers and logistics operators

Southern California’s Alameda Corridor is an excellent prototype for greater investment. The Scope Alameda Corridor Development Authority, a special • National purpose delivery entity, was established to plan, • National Significance finance, build, and operate elements of this • Megaregional intermodal goods movement corridor. It connects • Regional the Ports of Los Angeles and Long Beach to the • State national rail system northeast of downtown Los • Local Angeles, running parallel to Alameda Street. With • Underserved Community this corridor, goods shipped from Asia, which arrive at the Ports, can be transported to the national rail system quickly. The Corridor has helped develop Los Angeles’ already fast-growing logistics sector, spurring the creation of a large share of the region’s low- and medium-skilled jobs in recent decades.

Chicago Region Environmental and Transportation Efficiency Program (CREAT), 2014, http://www.createprogram.org/

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

The Solution Strategic investment in freight transportation infrastructure is crucial to support a robust logistics and supply chain network for the new digitized economy and just-in-time delivery over the next 50 years. Categories of freight investment include short-range, mid-range and long-range freight transport; intermodal facilities; distribution, fulfillment center and warehousing planning; across all of these systems, the scope and scale of investment need to be defined and priorities across different modes need to be clearly articulated. Furthermore, emerging technologies in the freight movement market should be incorporated into strategic investment plans immediately. Scope and Scale of Investment Different types of investment should be considered depending on the scale of the intervention. •

•

Freight: Short-range freight transport refers to local delivery, including the last leg and the 50-to-100-mile trips from distribution centers to end customers. This usually happens within single state in urban or rural areas, requiring local and state funding. By investing in Class II and Class III railroad tracks and bridges, local farmers and manufacturers can gain access to national and even global markets. Mid-range freight transport refers to the shipments between two large distribution hubs, or shipments from distribution centers to major transportation hubs like airport and ports. Usually these routes operate within a single state, stretching around 100-500 miles, and don't cross jurisdictional boundaries. State authorities can construct new or manage and upgrade old infrastructure systems with flexibility by capitalizing projects with local tax revenue. Long-range shipment, however, should be considered on a national or semi-national scale because its systems often pass through multiple states with a range of 500-1000 miles or more. A domestic example of this is an automobile product, manufactured in Detroit, that travels to Philadelphia’s port where it is shipped abroad, requiring the support of the interstate highway and freight rail systems in Michigan, Ohio and Pennsylvania. Federal involvement can streamline these systems. Intermodal facilities and distribution centers: Improvements to intermodal connections will require collaboration between Class 1 and short-line railroads, truckers, and state and local transportation authorities. In addition, direct federal grants and loan guarantees or enhancements may be needed to incentivize these investments.

Due to the growth of e-commerce, the traditional distribution paradigm has switched to omnichannel. “Manufacturing-Distribution Center-Retail-Home” has shifted to “Home-Home/Store-Store.” The number of fulfillment centers has grown while fewer, larger distribution hubs connect the system to households. There is a need for increased local investment to fund improvements in this network of centers and hubs: • Highways: we need to increase the number of truck-only toll lanes and congestion managedtoll lane to reduce delays and ensure road safety. • Freight railroads: the nation’s Class 1 railroads are all profitable and capable of making most of these investments. Improving bottlenecks and strengthening intermodal links may require federal RRIF (Railroad Rehabilitation Improvement and Financing) loans. More than $30

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•

billion in subsidized loans are available from the Federal Railroad Administration for this purpose. Inland waterways: this system controls 2/3 of the whole economy. As analyzed in the previous Inland Waterways Section, insufficient operation causes severe delays and deserves federal attention.

Emerging Technologies Adoption New technologies have the potential to transform the freight industry and improve the supply chain productivity while reducing the environmental impact of transportation. In the trucking industry, new technologies include platooning, self-driving vehicles, and electric power systems. Platooning allows truck fleets to travel at 65mph with spacing of 30-50 feet51, with trucks at the front absorbing most of the wind resistance, reducing the fleets’ total fuel consumptions by more than 7%,52 largely improving the fuel economy. Electric trucks help the industry change the fuel source by using batteries, fuel cells, and overhead catenary systems instead of gasoline or diesel engines. Selfdriving trucks eliminate the driver-supply shortfall and reduce goods’ travel time by operating 24/7 without stopping. A national vehicle for investment Goods movement investments must be planned on a national scale. Mega-regions of urban corridors with the potential to be redesigned with greater efficiency, including the Pacific Coast, Inland West, The Great Lakes, The Great Northeast, The Southeast Manufacturing Belt, Gulf Coast, and The Great Plains, should be the foundation for this national system. Federal investments should include: • Multi-state investments to increase socioeconomic cohesion of the country; • Operation of the inland waterway system and the reconfiguration of under-utilized freeways, rails and ports; • The elimination of bottlenecks and chokepoints; • Improvement of existing rail yards and the creation of a direct connection between major distribution hubs supporting the just-in-time economy. Benefits and Outcomes The benefits of logistics and supply chain investment include a reduction in the number of chokepoints and bottlenecks causing severe economic losses, increased capacity in the current transportation system to meet growing freight demand, a decrease in environmental impact, and greater supply chain efficiency, strengthening the nation’s competitiveness in the global markets. “When truck drivers tailgating is actually a good thing”, CNN, February 16, 2017. http://money.cnn.com/2017/02/16/technology/truck-platoons-peloton-omnitracs/index.html 51

“Robot Truck Convoy Tested in Nevada”, Popular Science, June 2, 2014. https://www.popsci.com/article/cars/robottruckconvoy-tested-nevada 52

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Example / Case Study Chicago is a national railroad hub. Every day, 500 freight trains come the city, bringing 37,000 individual rail cars through its railways. CREATE, the Chicago Region Environmental and Transportation Efficiency program, is one of America’s most successful public-private partnership projects, reducing freight rail congestion, moving freight more efficiently, and strengthening the region’s economic competitiveness. The 70-project plan improves efficiency and effectiveness of the region’s rails, reducing delays across highways in Chicagoland. The Federal government has played an important role in this project, identifying the investment as a project of national significance, illustrating the role Washington can play in guiding transportation infrastructure investments that are the cornerstone of our economy. Conclusion Investing and improving freight transport can create substantial values to the logistics and supply chain, thus contributing to the nation’s GDP growth and strengthening its competitiveness in the world trade market.

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

STRATEGY 10: Plan Ahead Now for HSR and HPR Develop a long-term framework for high speed rail in the United States, funded predominantly by the federal government. Overview High speed rail has the potential to connect America’s eleven megaregions, which are too large for traditional automobiles and conventional intercity rail travel and too small for air travel. If designed and implemented across these sprawling areas, high speed rail could connect America’s regions, promote megaregional economies and labor markets, bolster underperforming regions, and connect talent with access to jobs and housing. Globally, 27 countries have already implemented high-speed rail networks, including Japan, France, and Germany. China has been in the high-speed rail (HSR) business for over 10 years, and in Europe, the nations of France and Spain have financed HSR systems to strengthen the connection between Paris and Madrid. The United States is laggin. The US is now behind Tajikistan, Vietnam, Morocco, India and other developing countries in building HSR systems. Without a competitive higher performance transportation system to carry people and goods, the US is becoming less competitive economically. The existing intercity rail system is outdated, subject to delays, and inefficient, while other transportation modes are congested and do little to promote regional and megaregional development.

Indicators + Targets • Connected regions • Expanded regional/megaregional labor market and increased wage rates in short term • Increased ridership on city transit • Agglomeration economies • Bolstered underperforming regions • Greater access to jobs and housing Goals • Ennobling and Exhilarating • Equitable and Accessible • Safe and Reliable • Smart Growth Stakeholders • Federal Government • State and Regional Government • Private Rail Companies Timeline • Phase 1: in 10 years • Phase 2: 10-20 years • Phase 3: 20-30 years Scope • National Significance • Megaregional • State and Regional • Underserved Community

The Solution The Federal government should provide the longterm vision and planning, and the bulk of the financial resources that are needed to build a HSR system. It should work in partnership with states and PFAs, and in some cases, the private sector, to finance, build, and operate a HSR system. Once these systems are built, the government can bring in the private sector to maintain and operate the right of way. The government can provide the

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concession agreements for these private operators and leverage the capacity and management skills of private partners to keep the rail network functional and reliable. Governments often participate in funding HSR because of the high capital cost. The unit cost for high-speed rail construction unit cost (cost per-mile) varies by geographic location, scale of the system, and design; the cost will largely increase in mountainous areas or areas requiring bridges. In California, where the cost of HSR reaches $82 million per mile (compared to only $2.4 million for moderate-speed rail), the cost is driven by the surrounding mountains.53 Understanding how other countries finance HSR systems provides a useful lens to consider how America can create a national system of its own. In China, the central government collects a very high percentage of total tax revenues, leaving only 25% to the provincial and local government. This ability to control the significant share of the nation’s economy contributes to the thriving of HSR business. In 2006, the country committed to plan and build a passenger-dedicated HSR network. Since then, it has spent more than $360 billion to build 22,000km (13,670 miles). And there are plans to add an additional 15,000km (9,941 miles) by 202554. This studio proposes a three-phase process for building HSR routes in the nation’s eleven megaregions: • Phase 1: years 1-20 • Phase 2: years 10-20 years; and • Phase 3: 20-30 years. We propose that a dedicated, long-term funding stream of $80 billion per year be established to pay for this program. Benefits and Outcomes A national high-speed rail network could transform the economy and mobility systems of America’s eleven megaregions, which are home to seven out of every ten Americans and an even larger share of the US economy. The principal advantage created by HSR would linking housing and labor markets across each megaregion. This will create enormous synergies between metro economies and open up major new employment and housing opportunities for Americans. Additionally, HSR will reduce congestion in already highly congested airports and interstate highway throughout these megaregions, unlocking capacity that can be better used for longer range air travel and goods movement within and between megaregions. HSR will reduce carbon production and promote more compact development in the center cities that it serves. Finally, HSR has the potential to revitalize

“The True Cost Of High Speed Rail For The U.S. Is More Than $500 Billion”, Business Insider, May 4, 2009. http://www.businessinsider.com/the-true-cost-of-a-high-speed-rail-for-the-us-is-more-than-500-billion-2009-5 54 “China’s High-Speed Train Map Puts U.S. Transportation to Shame”, Medium, Paris Marx, Jan 22, 2017. https://medium.com/@parismarx/chinas-high-speed-train-map-puts-u-s-transportation-to-shame-272e6694c04d 53

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the economy of bypassed small and mid-sized cities that would gain new access and better connections to larger, more vibrant cities. Example / Case Study In 2017, the California High-Speed Rail Authority began construction on the HSR connecting San Francisco and Los Angeles. The project is funded by $10 billion in voter-approved bonds, proceeds from the state’s climate cap and trade program, and $3.3 billion in federal funds. But a large share of the project’s $77 billion cost remains unfunded and the project has been slowed by political opposition in the Central Valley, where the first operating segment is located. Still, the state has continued to fund the project because the roadway and air alternatives for travel between San Francisco and Los Angeles are far more expensive and disruptive. Conclusion Creating a national high-speed rail system serving all eleven US megaregions should be a high priority for federal funding as part of a national transportation investment strategy. Federal leadership and financial incentives should also leverage investments from the states and possibly sovereign wealth funds to capitalize these projects. Once completed, these routes could be leased to pension funds or other big investors, with the goal of recovering up front capital investments over a period of several decades. Value capture systems could also be utilized to finance center city stations and other priority activities in major cities that gain HSR service.

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MOBILIZING INVESTMENT IN AMERICAâ€™S TRANSPORTATION INFRASTRUCTURE

Mobilizing Transportation Investment in Los Angeles: Project Profiles To resolve the issues impeding the free-flow of traffic on our major systems, we need a new, comprehensive approach to American transportation – one that increases funding for system improvements and that provides better solutions for transportation nodes. We developed our ten strategies as part of this comprehensive approach and, in the following section, we profile two project proposals that we conceived to illustrate how these strategies, as well as some key design principals, would combine to achieve our transportation goals. Both projects are in Los Angeles, a city whose transportation issues mirror those of the entire country. The first project profile at Los Angeles Union Station shows how this historic but underperforming transit center and its surrounding district can be transformed into a destination and a focal point for the region’s future economic development. As we conceive it, this project will promote transit use and enhance the economic vitality of its surrounding neighborhood by spurring new development and providing connections to nearby attractions. Our second profile at the I-5, Santa Ana Freeway Corridor demonstrates how our strategies could resolve regional congestion by redistributing drivers from roads to transit and by enabling sweeping improvements to Metrolink, the area’s regional rail network. This profile focuses on the highly congested I-5 corridor where it runs through LA and Orange counties, but is meant to provide an example for how our strategies could be used to reduce congestion across LA. Although these profiles vary in scope and depth of vision, we hope to convey how these two projects would build off and support each other. The redesigned Union Station would fundamentally change the experience of traveling by creating new density around the station, connecting high speed rail passengers from other regions, and elevating Angelenos perception of transit. This would support Metrolink and transit ridership generally and help pry people out of their cars. Meanwhile, a more connected Metrolink will help to fuel the centrality of Union Station as the network hub and propel the economic growth of the station district. Both these profiles are intended as models for how our strategies can be used to create similar improvements, not only across LA, but across the entire United States as well. Project Profile: Los Angeles Union Station The historic Los Angeles Union Station was built in 1939 during the boom of the railway age – an era in which travel by train was prestigious, exciting, and glorified through architectural significance. Following the post-war decline of rail, the station, in a narrative shared by many infrastructure assets, weathered decades of disinvestment. Today, with California’s high-speed rail and a wealth of new technology on the horizon, it is critical to reestablish Union Station as a gateway to the region. In our proposal for LA Union Station, we have aimed to accommodate expected ridership growth, provide an ennobling and exhilarating experience for visitors, craft a focal point for the region’s future economic development and urban identity, and support a less automobile-reliant Los Angeles

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lifestyle. Aiming to reestablish transit’s position in the popular imagination, our vision for Union Station prioritizes and celebrates travel by transit and by rail - both regional and intercity rail as well as America’s first High-speed Rail network. Background Transportation Union Station sits at the center of Southern California’s rail system, bringing together Amtrak and Metrolink Regional Rail; Metro’s Red, Purple, and Gold urban rail lines; and bus routes including connection to LAX. A brief overview of the services that passthrough Union Station is provided in the table below. Service

Overview

California High-speed Rail

The proposed California high-speed rail, the first in America, is anticipated to arrive at Union Station by 2029. This service will span the length of California, providing fast, comfortable connections to major metropolitan areas spanning from the Bay Area to San Diego.

Metrolink

Union Station is at the center of the Metrolink network, Los Angeles’s regional rail system. This network includes seven lines, six of which operate at Union Station, and extends throughout the greater Los Angeles region.

Amtrak

Amtrak operates short and long distance intercity train service, working in tandem with Metrolink to connect passengers to surrounding areas and regional destinations.

Red Line

Union Station is the southern terminus for the Red Line, which offers regular service to Hollywood via Downtown Los Angeles.

Purple Line

Union Station is southern terminus for the Purple Line, which connects Union Station and Downtown Los Angeles to Koreatown (at the Wilshire/Western station). Metro is in the process of extending the purple line an additional nine miles, serving seven new stations including a stop at UCLA before terminating by the VA Hospital in Westwood.

Gold Line

Metro’s Gold Line, a commuter light rail service, has grown dramatically in the last few years. In 2016, Metro opened an 11.5-mile extension; the service now curves around Union Station, connecting East Los Angeles with Azusa.

Bus

As an intermodal center, Union Station links many urban transit systems, including several local bus routes. Visitors can also access long-distance buses and an airport connector bus.

Today, many riders transfer between modes at Union Station and rely on connections between these services, yet the movement between modes is complicated by crowded and unorganized circulation patterns. Improving these connections with intuitive wayfinding and better accessibility will help craft an enjoyable and ennobling experience for the people who pass through this cultural landmark every day. Especially with California working to introduce the country’s first high-speed and highperformance rail service, it will be critical to improve these connections in the coming decade.

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Figure 27. Regional travel map In the future, traveling from Los Angeles to Las Vegas or San Francisco will not require hours spent in freeway traffic; high-speed rail connections will carry passengers to these destinations in just two and three hours, respectively. Additionally, the cityâ€™s transit provider, Metro already plans to implement 28 ambitious projects in advance of the 2028 Olympic Games that will overhaul the rail and transit lines, providing seamless and fast connections between destinations throughout the city. These changes are sure to attract new riders and interest in transit and rail. In fact, projections already anticipate that daily commuters passing through Union Station will nearly double by 2040.55 With so much change surrounding the station, there is tremendous opportunity to reposition Union Station by reinvesting in it and its surroundings to prepare for these new passengers, new services, and new transportation realities, such as AVs and enhanced TNCs.

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Figure 28. Anticipated passenger flows in 2040

Figure 29. Anticipated passengers by arrival mode and transfer mode in 2040 Location The station is adjacent to the Los Angeles River and the 101 Freeway and is situated at the convergence of many storied Los Angeles neighborhoods — the Historic Core, Civic Center, Chinatown, Little Tokyo, and an emerging Arts District to its south. Its significance as a regional landmark is also reflected by its proximity to institutions including City Hall, El Pueblo, and other landmarks and museums.

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Figure 2. Surrounding assets (Left) and nearby properties (Right) Today, the parcels within this one-mile radius are typically undervalued and underutilized, especially considering the history, significance, and importance of Union Station. Buildings immediately surrounding the station, including a prison and several warehouses, are low in value and density. Infrastructure and roadway design that makes the area unappealing and unsafe for pedestrians is another contributor to the area’s low value. Though Union Station is a five-minute walk from the Los Angeles Plaza Historic District, which contains the oldest section of the city including the famous Olvera Street, the current street design makes access difficult and uninviting. With so many excellent amenities and underutilized land surrounding the station, the area is well positioned for redevelopment and could easily be transformed into a cultural and economic hub with the right design interventions. For example, directly adjacent to Union Station sits the Arts District, a neighborhood with a post-industrial character already establishing renown as a hotbed for arts and culture. Ripe for development and investment, the area’s streets are lined by vacant warehouses with potential to become high-quality and high-value studio, gallery, retail space, or homes. Aiming to leverage Union Station as an anchor and catalyst, the Arts District is one of five focus areas we have identified for strategic redevelopment purposes. Design Principles Union Station should be an intuitive intermodal hub that coordinates light rail, regional and intercity rail, bus routes, and bicycle and pedestrian access. But, beyond serving as just a place to go through, our proposal makes Union Station a destination people will want to go to. To achieve this, our redesign extends beyond the station and into the surrounding area and is founded on four primary design principles. As we conceived it, the design for the future of Union Station:

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1. Rearranges land use and function to create an engaging sense of place that is attractive to both visitors and residents, as well as investors; 2. Considers the Relationship between Buildings and Open Space to ensure the neighborhood has access to well-designed, functional, and welcoming open space, including an activated LA River waterfront; 3. Builds a pedestrian and bike corridor that connects the LA River to the Civic Center area, providing comfortable and safe mobility options for all modes and all users; and, 4. Embraces new technology to accommodate dynamic features such as real-time updates and condition-responsive pricing; integrate new mobility options such as AVs, EVs, and TNCs; and allow the station and neighborhood to achieve the highest possible level of efficiency in movement and operations. Design Proposal

Figure 2. Proposed Union Station redesign Friction-Free and Ennobling Travel Experiences Traveling through the new Union Station will be an ennobling and exhilarating experience, inspiring visitors and fostering a sense of pride and ownership among locals. As the regionâ€™s premiere train station and transportation hub, the station will feature both local, intercity, and long-distance service on its bus, transit, train, and high-speed rail lines. Each day, thousands of pedestrians will pass through Union Station on their way to their preferred mode of transportation. About 40 percent of riders will transfer from one service to another, so it is critical that wayfinding and connections are MOBILIZING INVESTMENT IN AMERICAâ€™S TRANSPORTATION INFRASTRUCTURE

intuitive. The new organization and design of transit-related ingress and egress will accommodate the anticipated pedestrian flow patterns and provide friction-free intermodal transfers.

Figure 2. New station circulation Most travelers will walk along an attractive and engaging elevated connector, linking the East and West side of the station and providing traveler amenities and opportunities to shop, dine, and enjoy the space. The stationâ€™s track and platform area will also be redesigned to accommodate greater capacity for high-speed and high-performance intercity rail through the addition of a new platform. The new layout of tracks and platforms will be accessible by the elevated connector, which will double as a waiting area for passengers.

Figure 2. Station interiors

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Figure 2. Arrival concourse

Figure 2. Departure Concourse

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Embracing New Technology Union Station will provide an exemplary model by preparing for and capitalizing on new and emerging technologies. Our plan emphasizes services and technology like high-speed and high-performance rail and the station layout will also be one of the first examples of fully-integrated facilities for automated and shared automated vehicles and other forms of new mobility. TNC lots located on the east and west sides of the station will serve as designated drop-off and pick-up areas to streamline both passenger and vehicular flow. Bike share stations located on a multi-use corridor will also provide visitors with active transportation options. In addition to accommodating these emerging modes, Union Station will rely heavily on real-time, open, and comprehensive data to improve the traveler experience. Updates on train and transit arrival, departure, and capacity will be streamed to travelers and integrated into the operational side of the station. This data will equip Metro and other service providers with new information and new methodologies to address issues and improve service. A data-driven policy for the station will insure that Union Station is continuously innovating and advancing to meet passenger needs. It will also provide the Station with the ability to institute dynamic programs, such as TNC-based congestion pricing, dynamic parking fees, or real-time spatial changes (i.e. redirecting or diverting passengers to other hallways) to mitigate crowding issues.

Figure 2. Birdâ€™s eye view of the complete station redesign A Greener Corridor

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A priority of the redesign is to ensure that the station features alternative modes of transportation. We have accomplished this through the integration of designated green space on either end of the elevated concourse and a comprehensive site plan that features functional open space. The roof of the station and elevated concourse will be available for walking and bicycling, providing an opportunity to appreciate Los Angeles’ sunny and moderate climate.

Figure 2. Overall site plan featuring extensive green space and corridors The nearby LA River is a cultural and environmental asset of the region and, per the City and Metro’s revitalization plans, a key bicycle route connecting Downtown Los Angeles with Long Beach to the south and Griffith Park to the north. The bicycle network of Union Station will connect cyclists with this facility through the construction of green corridors. This network will also extend through the surrounding areas to provide safe mobility for vulnerable road users like cyclists and pedestrians. In addition to being safe, these green corridors will also serve as recreation space, designed to activate the area and provide opportunities to explore and enjoy the station area. Mobilizing Investment in Los Angeles Union Station will promote development in the area by emphasizing high-quality design and demonstrating the value its connection to the city and region. Leveraging public investment at Union Station and seizing the development potential around the transit hub, our aim is to catalyze privateMOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

sector activity and create a new neighborhood for Los Angeles. As the area becomes an increasingly desirable place to live and to work, the construction of new high-rise, mixed-use buildings will accommodate a growing demand for housing and office space. Within the larger area, we envision the Arts District as a destination for artists and art appreciators with numerous studio spaces, galleries, and high-end design and retail stores. Overall, the scope of our redesign aims to leverage over 15M square feet of development. The mix of uses we envision is outlined in the following figures.

Use

Total Sq. Ft.

% of Total

Residential

6,166,209 sqft.

40.3%

Office

3,438,829 sqft.

22.5%

Retail

2,986,142 sqft.

19.5%

Hotel

1,196,300 sqft.

7.8%

Culture

1,299,288 sqft.

8.5%

School

161,558 sqft.

1.1%

Other

52,743 sqft.

0.3%

TOTAL

15,301,069 sqft.

100%

Figure 2. Development sites (Left) & proposed breakdown of development programs (Right) To the north, Site 1 will accommodate mixed-use development, including the addition of a hotel and other amenities for travelers and visitors, while the site located on the adjacent side of the tracks (Site 2) will accommodate mixed-use development. The design and development within Union Stationâ€™s immediate surroundings will center on providing an exhilarating welcome to the station, including a lifted concourse above the platforms that connects several areas of the station and larger site on multiple levels. A main pedestrian and bike corridor will lead people from El Pueblo, through the station, and connect to the LA River. The adjacent river front site will be the most valuable land for mixed-use office, retail, and residential uses. Lower Civic Center, which is part of the Arts District, will transform into a new dynamic district with high-end retail shops and galleries.

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Figure 2. The design’s central axis is this pedestrian and bicycle corridor running from El Pueblo to the LA River

Figure 2. Potential massings and programmatic layouts for proposed development sites surrounding Union Station MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

The realization of this vision hinges on the establishment of a PFA and Union Station-specific project authority to assume the role of liaison between multiple stakeholders, and to advocate for development and investment in the surrounding area. The PFA district we propose must extend beyond the project’s immediate surroundings to include all areas that benefit from the redesigned. A full discussion of this PFA and several other of our strategies that will be critical to this project is included in the section that follows. Strategies in Action at Union Station Plan Ahead for High-speed Rail: California is pioneering construction of High-speed Rail (HSR) in the U.S. with a corridor connecting the Bay Area to Southern California. By 2029, Union Station will serve over 20,000 HSR passengers, daily, as a terminal and connecting station.56 Planning ahead for the influx of passengers and for a unique set of needs related to intercity travel is crucial for the redesign of Union Station; likewise, it is important that Union Station provides an atmosphere that celebrates the experience of riding the nation’s first high-speed rail network. Establish a Union Station Public Finance Authority (PFA): The creation of a Union Station PFA will equip stakeholders with a centralized entity to fund, finance, and deliver the project. Designed to match the scope of benefits realized through the Union Station redesign, the PFA will facilitate collaboration and communication across a complex network of governments, transportation agencies, project developers, private partners, and other stakeholders. This inter-jurisdictional and cross-sector arrangement will streamline financing and leverage development by providing a single entity that facilitates efficient “deal flow” and is able to capture the value spurred by the station’s redesign and consolidate it with other revenues.

Figure 2. New, through-running tracks for high-speed rail (Left) & a potential jurisdiction area for the Union Station PFA California High Speed Rail Authority. (n.d.). Statewide Rail Modernization. Retrieved from http://www.hsr.ca.gov/Programs/Statewide_Rail_Modernization/index.html 56

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Create and Capture Value: The redesign of Union Station aims to use high-quality design to craft an ennobling and exhilarating experience for the millions of commuters, travelers, and neighbors that visit Union Station; the redesign will elevate the station’s role as a transportation hub and as a community, regional, and national, asset. Recognizing the benefits that will be created by designing a station that doubles as a destination, the PFA will establish a value capture mechanism toward servicing project-related debt. Union Station is well-suited for extensive development and creating new value, as the area, adjacent to Union Station currently includes acres of land that is undervalued and underutilized. The PFA may opt for the creation of a TIF district to borrow against future increases property tax revenue or agree to a Special Assessment District in which stakeholders implement a self-taxing measure based on the anticipated benefits. Get Government Funding Right: Union Station’s role as a transportation hub and community connector is regularly reported and featured in the long-range visions of METRO as well as SCAG and its municipalities. The ability to realize these visions will hinge upon the ability to procure financial and political support. Towards these ends, it will be important for Congress to unlock federal funding and allocate funds to the technical and design needs of the project, especially to assist with project ‘start-up’ costs. In addition to the fiscal benefit, this demonstration of national buy-in will be instrumental for securing additional investors and creating public-private partnerships. Streamline Project Delivery: As a special purpose authority with project-defined boundaries, our proposal for Union Station will streamline project delivery in two key ways: (1) the PFA, as a district and political body, will mitigate the typical challenges surrounding political boundaries and partisanship; and, (2) the PFA, as a financial entity, will provide access to capital resources necessary to manage, deliver, and maintain project. The PFA will also be responsible for awarding and overseeing a Design-Build (or DBOM) contract to a single firm (or consortium of firms) for design and construction of the new Union Station. DB or DBOM ensures delivery is consistent with design, and provides the selected firm(s) with greater flexibility to respond to challenges or opportunities as they arise. Develop Dynamic Data and Traffic Management Platforms: Union Station is an intermodal station that will serve a range of transportation needs, ranging from short-haul bus and subway commutes, to intercity Metrolink trips and high-speed rail journeys to the northern end of the state. This mix of needs and modes presents a prime opportunity for using data to coordinate services. For passengers, real-time schedule and location information will help to ease transfers and enhance the traveler experience. The movement between modes could be further advanced through shifting capacity based on real-time needs. Operationally, data sharing across transportation agencies will also mitigate many of the issues related to shared tracks by enabling identification congestion issues and appropriate responses such as rerouting or rescheduling of traffic.

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

Our Studio’s Vision for Union Station We envision Union Station not only as a hub for the Los Angeles transportation system, but also as a cultural hub for Downtown Los Angeles. The design of the station and the surrounding area serves to connect Union Station to nearby assets, such as the LA River, City Hall and other institutions, reknitting the surrounding areas into a unified community. Leveraging this holistic vision for the station and its surroundings, our scheme would generate most of the funds necessary to make it a reality and to further enhance the livability and the economic vitality of the Union Station district. We ultimately aim to establish Union Station not only as inspiring experience for those who pass through it, but as an inspiration and a model for mobilizing investment in infrastructure across America. Project Profile: Metrolink Regional Rail and the I5/Orange County Line Corridor Background LA Traffic Practically synonymous with heavy traffic and congealed roadways, in 2017, greater Los Angeles gained the dubious distinction of having been the most congested city in the world for the sixth straight year. As has already been discussed, a major contributor to LA’s congestion nightmare is the rapid pace of growth the region experienced over the last several decades. Since 1950, the population of greater LA has more than tripled, rising from 14.5 million in 1990 to 18.7 million as of 2015. With population growth to 22.1 million residents projected by 204057, congestion will continue to be a major issue and a measured approach must be taken to prevent the region’s strangulation by traffic. Adding lanes to increase road capacity is often the reaction LA and many American cities have to congestion, yet this approach has proven ineffective repeatedly, as is evinced by LA’s recent expansion of I-405. The $1.1 billion I-405 Sepulveda Pass Improvement Project, which resulted in new on- and off-ramps, bridges, and a northbound carpool lane between the 10 and 101 Freeways was supposed to relieve rush hour traffic along the corridor, but its promised benefits have not materialized. Not only did congestion increase during the five-year construction period from 2010 to 2015, but a traffic study by Seattle-based traffic analytics firm INRIX has concluded that, at 35 minutes during afternoon rush hour, the ten-mile journey now takes a minute longer than before construction.58 More roads are not the solution to LA’s congestion. Instead the region needs to invest in more buses and rail transit and in new technologies and innovative practices to reinvent their automobile centric transportation network.

SCAG. (2016). Demographics and Growth Forecast. Retrieved from http://scagrtpscs.net/Documents/2016/draft/d2016RTPSCS_DemographicsGrowthForecast.pdf 58 Los Angeles Times. (2017). L.A.'s traffic congestion is workd's worst for sixth straight year, study says. Retrieved from latimes.com: http://www.latimes.com/local/lanow/la-me-la-worst-traffic-20180206-story.html 57

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Figure 2. Los Angeles’ Metrolink regional rail map Metrolink In fact, transit is not a completely foreign concept to Angelenos. Despite its persistent congestion issues, the LA region has put forth heroic efforts over the last 29 years producing Metrolink, an extensive regional rail network with seven separate routes, 534 route miles,59 and nearly 12 million annual riders.60 Since its founding in 1991, Metrolink has steadily expanded its ridership and service by cobbling together existing rights of way and agreements with freight rail lines. Even with these efforts, however, the system’s ridership is still only about 5 percent61 of regional rail ridership in the area around New York City, a region with roughly the same population. Metrolink needs to continue expanding, but today it has effectively reached the limit of its capacity. Aging infrastructure, single track sections, limited station capacity, and onerous agreements with freight railroads all contribute to increasing delays and retard the continued growth of the system.

Metrolink. (2018). Facts & Numbers. Retrieved from metrolinktrains.com: https://www.metrolinktrains.com/about/agency/facts--numbers/ 60 Metrolink. (2018). Our Future is On Track, Metrolink 10-Year Strategic Plan, 2015 - 2025. 61 Ibid. 59

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Figure 2. Causes of increasing Metrolink delays62 Undeterred by these constraints, Metrolink has developed a 10-year strategic plan, which outlines the necessary steps to continue increasing service and ridership to 2025. They project that by making strategic investments in new rights-of-way, double tracks, modern signals, and improved stations (among many investments) they can not only get rid of the bottlenecks that hamper on-time performance and reliability today, but also expand and modernize the entire system. From carrying 42,577 daily riders in 2015, Metrolink anticipates that without any service growth ridership will grow organically to 46,812, but that with strategic investments ridership will rise to 53,893, more than 15% higher than the baseline.63 Yet, as things stand, Metrolink lacks a dedicated funding source for either operating or capital expenses and cannot gather adequate funding to support service expansion. They estimate that the plan’s baseline scenario, which consists of only enough improvements to comply with Federal Transit Administration (FTA) requirements imposed by MAP-21, will require $2 billion over the next ten years.64 This sum is presumably funded under current allocations, but it is estimated that at least twice that sum will be required to develop the service increases and connections to high speed rail outlined by the plan’s most ambitious scenario.65 However, even if the additional funding is found, Metrolink’s projections under its most ambitious expansion will not absorb enough commuters to resolve LA’s congestion nightmare. Especially considering population projections, the current plan for LA’s transportation system is inadequate and will ensure that roads and highways already jammed beyond capacity remain the primary of mode of transportation for Los Angeles residents. This outcome is unacceptable. Our Studio’s Solution We believe resolving the congestion issues in the LA region and American cities at large is imperative to the social and economic prosperity of the United States. Current financial shortfalls notwithstanding, we must find ways to continue investing in better and more efficient transportation

Ibid. Ibid. 64 Ibid. 65 Ibid. 62 63

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to ensure that all Americans remain free to choose where they work and live. In LA, this means finding funds for not only Metrolink’s most aggressive scenario, but going beyond that to electrify the entire system, purchase independent rights-of-way, improve connections, and disincentivize automobile travel on parallel systems. To this end, our studio developed the ten strategies previously outlined. Designed either to capitalize on an opportunity or address fiscal inefficiencies and shortfalls, each individual strategy can improve specific aspects of the transportation system, but it is in their combination that the strategies gain substantial power to transform the system. To illuminate how the strategies might work together, let’s consider LA’s I-5 corridor. For the second year in a row, the stretch of I-5 running through LA county topped Caltrans’ list of California’s ten most congested highways in 2017. In fact, six out of the top ten spots are held by highways in LA county, but the I-5 was still able to make the list again on its stretch running through Orange county. In 2012 alone, cars, trucks, and buses spent 6.6 million extra hours on the I-5 in LA County due to “heavy traffic,” which is defined as moving less than 35 mph.66 Yet I-5 is somewhat unique among LA roads because it is paralleled for its entire length through Orange and LA county by Metrolink’s Orange Line. This parallel presents tremendous opportunity for reducing congestion on I-5 and reinventing the character of the I-5 corridor. Using the strategies our studio has developed for creating and gathering funds and leveraging new technology in combination with the interventions outlined in Metrolink’s strategic plan, we believe this corridor can be transformed to accommodate LA’s future growth and the friction-free movement of all LA Figure 30. I-5/Orange County Line Corridor residents. Strategies in Action on the I-5 Corridor Pay the Actual Cost of Congestion: The first step in the process will be to price the I-5 at an appropriate rate using taxes, tolls, and fees. This will ensure that the road operates closer to its maximum rate of throughput, while also producing new funds, and disincentivizing automobile travel.

CBS News. (2014). What California freeway has the most gridlock? Retrieved from cbsnews.com: https://www.cbsnews.com/news/what-california-freeway-has-the-most-gridlock/

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

Optimize the System: Funds paid by users of I-5 will now go into a single multimodal and distributed where they will provide the greatest increases in system efficiency and capacity, such as on the Orange County Line. Doing away with current modal silos, funds from all sources would be dispersed across modes and to specific projects based on a holistic view toward creating friction freemovement of people and goods rather than being disproportionately spent on automobile travel or the mode from which they were gathered. Institutionalize Public Finance Authorities: A PFA set up to manage the funds for the corridor would assemble capital from several different sources, consolidating it before assessing needs on the corridor and distributing it based on individual project or initiative merits. The PFA would be responsible for gathering funds from governing bodies that receive benefits from the corridor (i.e. Federal, State, County, etc.) and combining them with funds from tolling, transit fares, and value capture district proceeds. Harness New Technology: New and better technology should be fundamental to all aspects of corridor improvements, but it will be especially important for improving connections to and from the Orange County Metrolink Line. Making transit easily accessible and convenient for all users is essential to the success of the corridor. The improved corridor would involve partnerships with or incentives for transportation network companies (TNCs) or automated vehicles (AVs) to provide affordable first and last leg connections to transit stations and a single, integrated, smartphonebased fare system for seamless transfers between all modes. Develop Dynamic Data and Traffic Management Platforms: One of the biggest drawbacks of public transit is the variability and sometimes infrequency of service. It makes users feel helpless. A simple solution to this issue is to provide users with accurate real-time data, keeping them informed and enabling them to tailor their schedule around any service changes or disruptions. An open data platform around the Orange County line would provide the real-time information for third-party app developers to transform into high quality, passenger facing products, which would keep them up-todate on all transit movements and advise them on their best possible transportation option. Eventually this data could also inform the routing of buses or schedule of trains as well as pricing of all modes to create a truly dynamic system for managing traffic on the corridor. Get Federal Funding Right: Although our strategies for raising funds will create significant new revenues independently, support from the federal government will be crucial for the earliest stages of project development. Federal funds would be used during predevelopment to assess project scope and create business plans to attract private partners among many other scoping initiatives. This would provide the foundational basis for continuing investment in essential projects on the corridor. Redesign Goods Movement System: Although we are not proposing any interventions aimed specifically at improving goods movement along the I-5 corridor, traffic reduction on the I-5 will vastly improve the efficiency of transporting goods through the LA region by increasing the speed of delivery and reducing the time trucks spend sitting idle in traffic.

MOBILIZING INVESTMENT IN AMERICAâ€™S TRANSPORTATION INFRASTRUCTURE

Our Studio’s Vision for the I5 Corridor and Greater LA In combination, these strategies would completely change the character of the I-5 Corridor. They would unlock I-5, maintaining a steady flow of traffic at 65mph, and create funding for Metrolink improvements, increasing the speed and frequency of service. They would also improve connections and create easy, dynamic trips via transit. In comparison to the alternative, where 18% more people will have to cram onto LA’s already log jammed freeways by 2040, our strategies working together would facilitate free-flowing transportation not only on the I-5 corridor, but also across Greater LA and America.

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

Approach We propose project frameworks at different geopolitical scales to align decision-making, funding/financing, and governance with the geographies where problems occur and where benefits accrue. We define project scale categories as: ● National ● Projects of National Significance ● Megaregional ● Multi-State ● State ● Regional ● Local, and ● Rural and Bypassed Areas A complete overhaul of the infrastructure planning and procurement process is required to lower costs and speed delivery of needed projects. At each scale, we recommend new parameters around scope, selection criteria, benefits, capital sources, and leadership structure. ●

Scope is used to define the size and character of a project: ○ National projects are defined as federal systems spanning multiple states; ○ Projects of National Significance include specific projects that have significate GDP impact and benefit 25% or more of the national population; ○ Megaregional projects consist of infrastructure connecting large networks of metropolitan regions that share environmental, infrastructure, and economic systems within an identified megaregion ○ State projects include transportation under the jurisdiction of a single state; ○ Multi-state projects require the cooperation of multiple states; ○ Regional projects connect larger metropolitan areas to smaller cities, surrounding suburbs, and exurbs; ○ Local projects include transportation infrastructure aimed at site-specific; neighborhood, or district geographies; and ○ Rural and bypassed areas, including projects serving economic development goals in underperforming areas.

●

Selection Criteria are used to prioritize certain projects over others based on social, environmental, and/or economic goals. For national projects, this might include the projected impact on GDP. For a project of national significance, this could be a measurement of the share of the national population within the watershed. Mega-regional projects should be prioritized if they expand labor markets or improve access to housing through the optimization of mobility. State projects will directly connect to policies outlined by state-level governments, sometimes requiring multi-state cooperation if the project spans multiple jurisdictions. Regional projects rise to the top if they integrate measures to decrease congestion. Because inequity is most visible at the community level, local projects should seek to expand

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

opportunity. Projects in rural and bypassed areas should directly benefit disenfranchised populations in areas where infrastructure receives failing grades and there are limited valuecapture opportunities. ●

Sources of capital will vary from project to project, but the Federal government must be prepared to provide funding and financing for transportation infrastructure to complement capital from local and regional governments. Projects will be paid for using: ○ Federal Commitments, which may come in the form of grants, loans, or credit enhancements ○ Regional or Local Commitments, which could include special assessment districts, tax increment financing, taxes, fare, tolls, and fees ○ Private Sector Involvement, or P3s, which may take the form of loans, private activity bonds, or value capture

The breakdown of these three sources within the capital stack will span the spectrum, yet the following guidelines should be used to determine who is responsible for sharing the infrastructure bill and to what extent: ○ ○

○

○ ○ ○

○

○ ●

National projects should have sizable Federal commitments close to 100%; Projects of National Significance will need 50-80% of funding to come from Federal sources, with the other 20-50% from regional or local sources. These projects are vital for the American economy to remain competitive and therefore should receive significant support from Washington. Mega-Regional projects require a balanced commitment of Federal and local capital. The Federal government needs to invest in the connections between jurisdictions that span across multiple regions. Local actors benefiting from these investments need to dedicate funds to remain connected. State projects will be led by the state governments. Multi-state projects may receive supplementary funding from the federal government but will primarily rely on state funding. Regional project funding should come from local and regional governing bodies, with a smaller share from Federal sources. In the absence of a regional body with taxable authority, states will allocate funding accordingly. Local projects will receive the least amount of funding from the Federal government and must provide up to 90% of the capital from their own budget, or through financing with a private partner. Rural and bypassed areas, will rely on a significant Federal contribution.

Leadership: Depending on the sources of capital and governance structure proposed for a project, leadership will differ. ○ The federal government must oversee national projects like interstate highways, air traffic control, and logistics.

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

○ ○

State and local governments must take the lead on projects that do not require Federal management. Special purpose vehicles should be deployed to avoid problems stemming from political partisanship and term limits. While major infrastructure projects should be planned and authorized with government involvement, special purpose vehicles should be created with the express purpose of delivering either a single infrastructure project or a series of associated projects.

MOBILIZING INVESTMENT IN AMERICA’S TRANSPORTATION INFRASTRUCTURE

PROJECT SCALE

NATIONAL

PROJECTS OF NATIONAL SIGNIFICANCE

MEGAREGIONAL

MULTI-STATE

STATE

REGIONAL

LOCAL

RURAL AND BYPASSED AREAS

More than one state required for project success

Link to statewide policy

Sustainability, mobility, resilience

Linkage with land use and expansion of equity

Disenfranchised populations within benefit area, failing infrastructure grades, limited value to capture

Scope Definition Criteria

Impact on GDP, national competitiveness,

Federal Share of Public Money (Examples include Grants, Loans)

Shared Funding

Regional or Local Share of Public Money (Examples include Special Assessment Districts, TIF, Taxes, Fares, Tolls, Fees)

Private Sector Involvement (Examples include Value Capture/Property Tax, capital, financing)

% of national population within watershed, Expansion of labor market, improved size of economic impact access to housing, optimization of mobility

90-100%

50-80%

45-55%

25-35%

20-30%

90-100%

0-10%

20-50%

45-55%

65-75%

70-80%

0-10%

Yes

Charge for use of streets Interstate charging stations Car, Truck & Bus

Essential links

Highways and bridges

High-performance Regional Rail

Policies for cross-subsidies (gas tax)

Gowanus/BQE must be citysponsored Congestion pricing

Safety and efficiency standards Mode

Rail

Dynamic congestion management High-speed Rail

Interconnectivity Bottlenecks

Freight

Program to increase capacity, safety & speed

Airports

Air traffic control Devolve capacity for fees

Federal Government Led

Federal Leadership

State Government Led

Rebuild and extend new systems

Greater access

Trans-Regional Rail Redesigning roads with embedded technology of some sort

Major ports and watereways

Airport operations and construction Federal government may play the role of credit enhancer even in projects where it is not lead

Governor Leadership

Governor Buy-in

Leadership

Metro/Local Government Led

Metro Leadership

Special Purpose Authority Led

Semi-Autonomous Entity

Metro Leadership Autonomous Entity

Autonomous Entity

MOBILIZING INVESTMENT IN AMERICAâ€™S TRANSPORTATION INFRASTRUCTURE

101

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MOBILIZING INVESTMENT in AMERICA’S TRANSPORTATION INFRASTRUCTURE

Interactive Polling This is an interactive presentation, and we appreciate your feedback!

PennDesign Studio Final Review May 7, 2018

There are two methods to enter the poll:

Text “PENNDESIGNST511” to 22333 or

Visit PollEv.com/penndesignst511 1

State of America’s Transportation Infrastructure Today 10%

DETERIORATING

14%

CONGEALED

38% Source: NBC

Source: NPR

24%

DANGEROUS Source: USAToday

TOXIC Source: Union of Concerned Scientists

14%

Transportation infrastructure must be… ennobling and exhilarating

Transportation infrastructure must be… free-flowing

High Speed Rail – Beijing, China

Transportation infrastructure must be… equitable and accessible

Temple University Station – Philadelphia, PA

Grand Central Terminal – New York, NY

Transportation infrastructure must be… safe and secure

Table Rock Lake – Branson, Missouri

Transportation infrastructure must be… carbon neutral

Electric Bus– London, UK

Transportation infrastructure must be… linked with sustainable land use policy

Ten Strategies

Cottle Transit Village, San Jose, CA

Our Greatest Failures FUNDING SHORTFALL

New funding and sources of investment capital will be the essential for the renewal and modernization of transportation systems.

OUTSIZED PROJECT DELIVERY COSTS

WEAK DECISION MAKING

Spending funds responsibly to attain the most utility and best outcomes given all constraints.

Promoting long-range goals, investments must build upon each other to form a cohesive, equitable, efficient, and comprehensive network. 11

Funding Shortfall

Funding Shortfall for Achieving State of Good Repair ASCE $1.2 Trillion 10-Year Investment Gap for State of Good Repair

Infrastructure Spending as a % of GDP: OECD Countries 2.00%

• U.S. Spending Half of OECD Average on Transportation

1.50%

1.00%

Surface Transportation

$29.4B

1.00%

• China Spends 5.3% of GDP in Infrastructure

0.62% 0.50%

Airports

Rail (Amtrak & Freight)

Inland Waterway & Ports

$42B $15B

$941B $1101B

$22B $115B

$124.7B

0.00%

Funded

$1,202.7 B

Unfunded

$1,187.4 B 14

Funding Shortfall for Achieving Infrastructure Needs

Outsized Project Delivery Costs NYC’s 2nd Avenue Subway

ASCE $2 Trillion 10-Year Investment Gap for Need (Beyond State of Good Repair)

Typical Range of Subway Construction Costs 1000

Causes of Excess Costs: •

Outdated labor practices

•

NEPA & other regulations

•

Restricted delivery models

•

Excessive red tape

900

$206 billion $2.5 Billion Per Mile

X 10 years

Amsterdam’s Noord-Zuid Subway

= $2.0 trillion

Cost/Mile $ (Millions)

800 700 600 500 400 300 200 100 0

$615 Million Per Mile Source: ASCE

European/ Japanese

Weak Decision Making

Our Greatest Opportunities

• Projects are prioritized over programs

New Funding

Dedicated Project Delivery Entities

New Technology

Long-Term Comprehensive Programs

• Most decisions are reactionary rather than strategic • Government is averse to risk, limiting innovation Funding

Efficiency

Vision

After widening Houston’s Katy Freeway to 26 lanes, travel time decreased by 36% immediately, then increased by another 42%

New Funding

New Funding Additional funding required for a state of good repair: $ 1.187 Trillion over the next 10 years Total = /10 years = /325,700,000 US Population = /12 months = /30 days =

How does this compare to other expenses?

$1,187,000,000,000 $118,700,000,000 per year $365 a year per person $30 a month per person $1 a day per person

$30 per month

Cell Phone Bill $71 per month

Car Ownership & Use $706 per month

Just $1 a day! 19

Café $92 per month

Car Maintenance $45 per month 20

Dedicated Project Delivery Entities

New Technologies Delivery Entities Can:

Crossrail, UK: Delivered on time and on budget by a dedicated project delivery entity

•

Drive down the cost of delivery by managing efficient delivery methods (DB, DBOM, P3)

•

Attract private investment through new financing entities (PFAs, infrastructure banks)

•

Effectively interface with private entities to align interests & share risks

•

Manage regulatory processes

Emphasize Sustained, Reliable, Multi-Year Investments

Integrate and regulate transportation network companies (TNCs)

Incorporate mode choices and real-time travel information in app or online

Employ dynamic intermodal pricing for roads and transit

Incentivize and charge AVs & EVs for passenger travel and goods movement

Ten Strategies

Investing in Canada

TEN-T – Connecting Europe

UK National Infrastructure Delivery Plan

$180 billion over 12 years

$615 billion from 2014 to 2020

$680 billion from 2016 to 2021

Unlock Government Action

Pay the Actual Cost of Congestion

Create and Capture Value

Institutionalize Public Finance Authorities

Plan Ahead for Highspeed and Intercity Rail • Authorized a new delivery entity • Established infrastructure bank • Enacted bilateral agreements with provinces and territories

• Created nine network corridors for continued regional transit growth with high speed rail and roads • Connected underprivileged populations • Utilized innovative financial instruments

• Established the framework through two newly-created bodies • Identified project priorities • Invested in nationally significant infrastructure

Streamline Project Delivery Redesign Goods Movement System

Harness New Technology

Optimize the System

Develop Dynamic Data and Traffic Management Platforms

Funding Strategies Unlock Government Action

Efficiency Strategies Pay the Actual Cost of Congestion

Create and Capture Value

Institutionalize Public Finance Authorities

Plan Ahead for Highspeed and Intercity Rail

Unlock Government Action

Harness New Technology

Optimize the System

Develop Dynamic Data and Traffic Management Platforms

Vision Strategies Unlock Government Action

Institutionalize Public Finance Authorities

Streamline Project Delivery Redesign Goods Movement System

Harness New Technology

Optimize the System

Develop Dynamic Data and Traffic Management Platforms

Funding Strategies Pay the Actual Cost of Congestion

Create and Capture Value

New funding and sources of investment capital will be essential for the renewal and growth of transportation systems.

Institutionalize Public Finance Authorities

Plan Ahead for Highspeed and Intercity Rail

1. Unlock Government Action 2. Pay the Actual Cost of Congestion 3. Create and Capture Value 4. Institutionalize Public Finance Authorities (PFAs)

Streamline Project Delivery Redesign Goods Movement System

Create and Capture Value

Plan Ahead for Highspeed and Intercity Rail

Streamline Project Delivery Redesign Goods Movement System

Pay the Actual Cost of Congestion

Harness New Technology

Optimize the System

Develop Dynamic Data and Traffic Management Platforms

Unlock Government Action

Unlock Government Action Example: The Federal government can take bold action to invest in infrastructure and should incentivize states, regional, and local governments to do the same. The Federal government needs to:

• Transportation infrastructure needs sustained, reliable, multi-year funding. • Total government spending and investment should be at least 1% of GDP.

•

• Sources are fares, fees, taxes and tolls, as well as investment. The Gateway Project: New tunnels underneath the Hudson River, a $30B project of national significance supporting 20% of the United States’ GDP

• Governments should seek, but not rely on, private equity and capital.

•

Pay the Actual Cost of Congestion Example: High-Occupancy Tolls (I-680, CA)

• Implement “user-pays” programs and policies that charge the true cost of traffic to the US economy—$124B annually—through taxes, fees, and tolls.

• • • •

• By increasing the Federal gas tax, establishing a vehicle miles traveled (VMT) fee system, and right-pricing highway tolls, drivers are charged proportionate to their usage of infrastructure.

•

• Reclaim highway lanes and congested streets for more efficient travel and toll lanes based on factors like time-of-day and occupancy, shift drivers to other modes or off-peak hours.

Raise the Federal Gas Tax by $0.25/gallon and incentivize tolls, fares, and fees; Fund projects of national significance; Rework the earmark process to reward smart projects and provide funds for predevelopment; & Streamline permitting, procurement, and accounting requirements associated with federal funds.

Grand Central Terminal – New York, NY

Pay the Actual Cost of Congestion

• •

Offers free access to carpool vehicles (highoccupancy); solo drivers can pay to use the lane Reallocates existing lanes Pricing reflects time-of-day and congestion level HOT lane provided an average 7.5 minutes of travel time savings and decreased throughput Reduces travel by car

HOT Lanes on I-680: Charging drivers the true cost of congestion through high-occupancy toll lanes

Grand Central Terminal – New York, NY

Create and Capture Value

• Maximize development potential around transit hubs and rail stations to increase property values and create development opportunities, thereby capturing value to finance projects and make them possible.

Example: Hudson Yards (New York, NY)

• Finance infrastructure improvements by dedicated future value increases to pay off bonds. • By focusing on train stations a focal point for value creation, cities can propose new transit components, financed through capturing a portion of the value created.

Extension of No. 7 Line, Public Space, Railyard Cap, Javits Center Renovation

•

Projected value capture: $98.6 - $130 million yearly

•

Leverage enabled by value capture: $3 billion in public bonds

Hudson Yards Special District

•

Institutionalize Public Finance Authorities

Grand Central Terminal – New York, NY

Institutionalize Public Finance Authorities

• Institutionalize Public Finance Authorities that gather and align funding from all geographies and parties that benefit from a project.

Example: Bridge EIFD (West Sacramento, CA)

• PFAs can work with infrastructure banks to attract better financing with a clear projection of cash flows.

•

• •

Authorized by Senate Bill No. 628 in 2013 Allows community to rehabilitate public infrastructure and private facilities Bridge funded using tax revenues from 4,000 housing units and 5M SF of commercial and retail space

• PFAs can raise money effectively to achieve public policy goals and match Federal funds when appropriate. West Sacramento Bridge: Created using an EIFD connecting West Sacramento and Sacramento

Grand Central Terminal – New York, NY

Efficiency Strategies

Spending responsibly to attain the most utility and best outcomes given all possible constraints.

• Establish special purpose delivery entities dedicated to the delivery of specific projects.

5. Streamline Project Delivery 6. Develop Dynamic Data and Traffic Management Platforms 7. Harness New Technology 8. Optimize the System

Streamline Project Delivery

• Streamline permitting and cut red tape. • Incentivize enabling legislation and use of PPPs and innovative delivery models (DB, DBOM) for states and local governments. • Insist on Project Labor Agreements (PLAs) to cut labor costs. 37

Streamline Project Delivery Example: Crossrail (London, UK) • • • •

Creates express commuter rail complementing the Underground with shorter trip times to major hubs Established special purpose company Crossrail Ltd. to deliver project Set out Project Development Agreement (PDA) and delivery strategy to successfully carry out the project Structure provides a significant degree of autonomy

London Crossrail: the new high frequency, high capacity railway for London and the South East

Grand Central Terminal – New York, NY

Develop Dynamic Data and Traffic Management Platforms

• Develop real-time transportation data platforms to improve decision making, empower transit riders, and inform dynamic transportation management. • Transportation databases will provide the capacity for empirically-based decision making by providing reliable, real-time information to authorities, users, and businesses. • Once data collection has advanced sufficiently, comprehensive dynamic pricing and management systems should be integrated to promote coordination among modes, optimize the capacity of our networks, and reshape the way America moves.

Develop Dynamic Data and Traffic Management Platforms Example: The World Bank’s Open Data Partnership and National Association of City Transportation Officials’ (NACTO) Open Transportation Partnership •

Harness New Technology

• Integrate Transportation Network Companies into public transit, incentivize supporting infrastructure for AVs & EVs, and charge TNCs, AVs, and EVs to use public roads. • Achieve greater sustainability and on-demand transit using shared EVs.

NACTO’s SharedStreets Platform designed as a “connector”

• Charge the Federal government to establish steering committees to interface with industry while setting system standards. SharedStreets data on taxi pick-up and drop-off volume.

Harness New Technology Examples: Uber Commuting Together (Atlanta, GA) • • •

Optimize the System

• Make funding decisions at a megaregional or regional level, and better respond to local transportation needs and priorities.

Charge TNC fees (Chicago, IL)

Chicago charges TNCs

• Merge existing transportation silos into single, multimodal entity that pools all revenue and funding and reallocate it towards optimizing the transit system.

2X Growth in UberPOOL trips during commuter hours to and from MARTA stations 8,000 Riders took their first UberPOOL commuter trip to MARTA 10.2% Increase in weekly driver-partner payouts

Uber Commuting Together

• •

• Create dedicated federal funding to give small and bypass regions the ability to adopt the technology as well.

$0.67 per-ride fee in 2017, another 0.05 increase in 2019 Raise $16 million in 2018 and $30 million in 2019 to help pay for track, signal and power system upgrades

• Use revenue from high-demand, high-value service to cross-subsidize fares and service in marginalized areas, thus promoting greater equity.

Optimize the System

Vision Strategies Example: Bus Toll Lanes (Tampa, FL) •

• •

Promoting long-range goals, investments must build upon each other to form a cohesive, equitable, efficient, and comprehensive network.

Local Expressway and Regional Transit Authorities collaborate on “Bus Toll Lanes” within existing right-of-way Lanes prioritize transit and require cars to pay to use the lanes Revenue from the toll lanes is reallocated towards transit operations and maintenance

9. Redesign Goods Movement Systems 10. Plan Ahead for High-speed and Intercity Rail

A single entity: All transportation-related funding is pooled and reallocated to the most efficient modes.

Grand Central Terminal – New York, NY

Redesign Goods Movement Systems

• The Federal government should fix gaps and bottlenecks, strengthen intermodal connections and support private logistics companies.

Example: Alameda Corridor (Los Angeles, CA)

• Use emerging technologies to change the fuel source of freight transport and increase supply chain efficiency.

•

• •

•

20-mile freight rail expressway opened in 2002 Led by special purpose entity: The Alameda Corridor Development Authority Connects the Ports of Los Angeles and Long Beach to national rail system Relieved congestion along I-710

• Utilize water routes to increase system efficiencies.

A New Map for Logistics Investment Alameda Corridor

Grand Central Terminal – New York, NY

#10

Plan Ahead for High-speed and Intercity Rail

• Prioritize transportation guided by long-term vision and planning at the Federal level with support from state, regional, and local governments.

Example: China’s HSR Network

• Fund High-speed rail to remain competitive with the 47 countries that have successfully implemented systems of their own.

• •

Committed to build HSR in 2006 Has spent $360B to build 13K miles of HSR networks since then Designed speed is 350km/h (217mph) Plans to add an additional 15,000km (9,321 miles) by 2025

• Use the efficiency of high-speed rail to connect metros within megaregions, grow access to jobs and housing, and bolster underperforming regions. • Engage public finance authorities to pool capital funds and build high-speed rail networks and partner with the private sector to operate the system.

37%

High-speed Rail: Created to meet the mega-regional travel demand and promote economics and labor markets

Grand Central Terminal – New York, NY

Mobilizing Transportation in Los Angeles Transforming MobilityInvestment in Los Angeles

40%

3% 7%

3% 3% 7%

Union Station: Busiest passenger rail west of the Mississippi Los Angeles Union Station can be a gateway and destination serving the whole Los Angeles region

Los Angeles Union Station Aerial Photo

Surrounding Assets

Union Station: Surrounding AssetsUnderutilized Properties

Chinatown

El Pueblo

Objectives for Transportation Investment

• Create the station, track, and platform capacity to grow Metrolink service and add high-seed intercity and regional rail serving he region and the megaregion

Union Station

City Hall

• Improve connections among all services • Provide TNC and on-demand transit to address the “first and last leg” challenges • Use areas below the tracks for freight, services, and other logistics functions Little Tokyo

• Build a station that is a destination, not just a transfer point 55

Objectives for Neighborhood Transformation

Strategies in Action

• • • • • •

• Attract station-oriented development to take advantage of connectivity and increase ridership • Integrate station site and warehouse development site between Vignes Street and the tracks • Provide bridge connections to the LA River Park • Provide walkable, bikeable linkages to adjacent sites primed for change

• Re-enliven the historic station and create stronger ties to the El Pueblo historic area • Rebrand Alameda Street as a strolling boulevard with priority for pedestrians, bikes, and shared on-demand vehicles 57

Strategies in Action

•

• • • • •

Strategies in Action

Plan Ahead for High-speed Rail • Accommodate new ridership and invest in design that celebrates the experience of America’s first high-speed rail network Institutionalize Public Finance Authorities Create and Capture Value Get Federal Funding Right Streamline Project Delivery Develop Dynamic Data and Traffic Management Platforms

New platforms and tracks at Union Station

• •

• • • •

Plan Ahead for High-speed Rail Institutionalize Public Finance Authorities • Consolidates and aligns funding from multiple sources Create and Capture Value Get Federal Funding Right Streamline Project Delivery Develop Dynamic Data and Traffic Management Platforms

Potential PFA Jurisdiction Area 59

Union Station

Strategies in Action

• • •

Plan Ahead for High-speed Rail Institutionalize Public Finance Authorities Create and Capture Value • Unlock Federal funding for HSR and enhanced intermodal connections Get Federal Funding Right Streamline Project Delivery Develop Dynamic Data and Traffic Management Platforms

Site 1

Value Capture

Site2

Percentage of Total Sq. Ft. development Residential 40.3% 6,166,209 Use

Site3

Site5

Site4 Residential Office Hotel Retail & Restaurant High-end Retail Gallery

Office

22.5%

3,438,829

Retail

19.5%

2,986,142

Hotel

7.8%

1,196,300

Gallery

8.5%

1,299,288

School

1.1%

161,558

TOTAL

100%

15,301,069

Potential Redevelopment Areas 62

Strategies in Action

• • • •

• •

Strategies in Action

Plan Ahead for High-speed Rail Institutionalize Public Finance Authorities Create and Capture Value Get Federal Funding Right • Unlock funding to cover the cost of HSR and enhanced intermodal connections Streamline Project Delivery Develop Dynamic Data and Traffic Management Platforms

• • • • •

•

Plan Ahead for High-speed Rail Institutionalize Public Finance Authorities Create and Capture Value Get Federal Funding Right Streamline Project Delivery • Utilize a Design-Build or Design-BuildOperate-Maintain contract process Develop Dynamic Data and Traffic Management Platforms

Strategies in Action

• • • • • •

Union Station

Plan Ahead for High-speed Rail Institutionalize Public Finance Authorities Create and Capture Value Get Federal Funding Right Streamline Project Delivery Develop Dynamic Data and Traffic Management Platforms • Integrate technology to facilitate frictionfree accessibility, provide real-time updates, and allow the creation of pricing schemes to mitigate congestion

Existing Condition

The Waiting Room is spectacular, but no longer in use.

Access to the tracks is through a low-ceilinged concourse which connects the west side with the east side where multiple bus services are provided. There is little to help passengers who are trying to 67 transfer.

Los Angeles Union Station Aerial Photo

Existing Circulation Union Station: Existing Station Condition

Circulation 2040 Union Station: Existing Station Condition

Ridership 2040

The Future Los Angeles Station

Passenger Flow 2040

Master Plan

Union Station: Plan

Section

Union Station: Plan

Diagram

Union Station: Plan

Diagram & Plan

Union Station: Plan

The Station Bridge is filled with customer services, small shops, and food and beverage for passengers and for community members headed across the tracks

Diagram & Plan

The Station Bridge also includes locations for planned and spontaneous concerts, art works, craft fairs and live performances.

Commercial District Plan

Value Capture Schematic Design 81

Value Capture Schematic Design: Section

Development Area

Value Capture Schematic Design

Value Capture Schematic Design 83

Traffic Flow Diagram

Rendering 85

LA Congestion and the I-5 Corridor

86 86

LA Congestion For the 6th straight year, Greater LA named the most congested city in the world in 2017.

I -5 CorridorAerial Photo

Traffic as a forum for song and dance in La La Land

LA Congestion

LA Congestion For the 6th straight year, Greater LA named the most congested city in the world in 2017.

Drivers in the LA region each spent an average of 104 hours driving in congestion. Estimated annual cost of more than $1,400 per driver

Typical Los Angeles 6PM weekday traffic

Traffic as a forum for song and dance in La La Land

Rush hour traffic on Interstate 405

LA Congestion

LA Congestion Typical response is to increase highway capacity Example: Sepulveda Pass Improvements • •

$1.1 billion for additional lanes, new ramps, and 3 bridges Results: One minute longer travel time during peak hours – 35 minutes to go 10 miles

Sepulveda Pass, I-405 widening

MetroLink

MetroLink Expansion constrained, delays increasing, and insufficient funds

Extensive Metrolink regional rail service built entirely in the last 27 years • • • •

Steady growth since founding in 1991 7 service lines, 534 route miles, and 12 million annual riders Ridership is just 5% of NYC’s No plans for expansion

MetroLink service constraints

MetroLink Regional Rail Map

Increasing trains delays & causes

Resolving LA’s Transportation Issues

I-5 Corridor Investment Profile The I-5 corridor as an exemplar for the entire metro region

Our vision is to integrate LA’s road, rail, and other modal networks into a unified transportation system. • • • •

Issues: •

Charge appropriate costs Spend wisely and capitalize on opportunities Plan for efficient freight movement Integrate transportation investment with growth vision and land use policy

LA’s Major Roads and Highways

Portions of I-5 running through LA and Orange Counties both made CalTrans’s list of top ten most congested highways

I-5 focus corridor

I-5 Corridor Investment Profile

I-5 Corridor Investment Profile The I-5 corridor as an exemplar for the entire metro region

Strategies in action: • • • •

Issues: •

Portions of I-5 running through LA and Orange Counties both made CalTrans’s list of top ten most congested highways

• • •

Opportunity: •

MetroLink and the parallel Orange County Line

Get Federal Funding Right Pay the Actual Cost of Congestion Institutionalize Public Finance Authorities Develop Dynamic Data and Traffic Management Platforms Optimize the System Harness New Technology Redesign Goods Movement Systems

I-5 and Orange County Line Focus Areas

I-5 focus corridor

I-5 Corridor Investment Profile

I-5 Corridor Investment Profile Strategies in action: •

• • • • • •

Strategies in action:

Get Federal Funding Right • Provides additional funds for this nationally significant corridor Pay the Actual Cost of Congestion Institutionalize Public Finance Authorities Develop Dynamic Data and Traffic Management Platforms Optimize the System Harness New Technology Redesign Goods Movement Systems

I-5 and Orange County Line Focus Areas

• •

• • • • •

Get Federal Funding Right Pay the Actual Cost of Congestion • Generates additional revenue from I-5 congestion Institutionalize Public Finance Authorities Develop Dynamic Data and Traffic Management Platforms Optimize the System Harness New Technology Redesign Goods Movement Systems

I-5 and Orange County Line Focus Areas

10 0

I-5 Corridor Investment Profile

I-5 Corridor Investment Profile Strategies in action: • • •

• • • •

Strategies in action:

Get Federal Funding Right Pay the True Cost of Congestion Institutionalize Public Finance Authorities • Consolidates and aligns funding from multiple sources Develop Dynamic Data and Traffic Management Platforms Optimize the System Harness New Technology Redesign Goods Movement Systems

• • •

• • • •

Potential PFA Jurisdiction Area

10 1

I-5 Corridor Investment Profile

10 2

I-5 Corridor Investment Profile Strategies in action: • • • •

• • •

Strategies in action:

Get Federal Funding Right Pay the Actual Cost of Congestion Institutionalize Public Finance Authorities Develop Dynamic Data and Traffic Management Platforms • Improves transportation decision making and facilitates integrated transportation management Optimize the System Harness New Technology Redesign Goods Movement Systems

I-5 and Orange County Line Focus Areas

• • • • •

• •

Get Federal Funding Right Pay the Actual Cost of Congestion Institutionalize Public Finance Authorities Develop Dynamic Data and Traffic Management Platforms Optimize the System • Breaks down funding silos between road and rail, enabling cross subsidies Harness New Technology Redesign Goods Movement Systems

I-5 and Orange County Line Focus Areas

10 3

10 4

I-5 Corridor Investment Profile

I-5 Corridor Investment Profile Strategies in action: • • • • • •

•

Strategies in action:

I-5 and Orange County Line Focus Areas

• • • • • • •

I-5 and Orange County Line Focus Areas

10 5

I-5 Corridor Investment Profile

106

Approach Strategies in action: • • • • • • •

We propose project frameworks at different geopolitical scales to align decision-making, funding/financing, and governance with the geographies where problems occur and benefits accrue.

I-5 and Orange County Line Focus Areas

107

108

Approach

Transportation Infrastructure will beâ€¦

109

Strategies & Outcomes Unlock Government Action

Develop Dynamic Data and Traffic Management Platforms

Ennobling & Exhilarating

CARBON NEUTRAL

SUSTAINABLE LAND USE 110

Cottle Transit Village, San Jose, CA

Institutionalize Public Finance Authorities

Free-Flowing Ennobling & Exhilarating

Create and Capture Value

Equitable & Accessible

Streamline Project Delivery Develop Dynamic Data and Traffic Management Platforms

Carbon Neutral

Equitable & Accessible Carbon Neutral

Optimize Transit Systems

Safe & Secure

Harness New Technology

Redesign Goods Movement Systems Plan Ahead for High-speed and Intercity Rail

SAFE & SECURE

Pay the Actual Cost of Congestion

Optimize Transit Systems Harness New Technology

EQUITABLE & ACCESSIBLE

Unlock Government Action

Free-Flowing

Create and Capture Value Streamline Project Delivery

ENNOBLING & EXHILARATING

Strategies & Outcomes

Pay the Actual Cost of Congestion Institutionalize Public Finance Authorities

FREE-FLOWING

Safe & Secure

Redesign Goods Movement Systems

Sustainable Growth

111

Plan Ahead for High-speed and Intercity Rail

Sustainable Growth

112

Strategies & Outcomes Unlock Government Action

Free-Flowing

Pay the Actual Cost of Congestion Institutionalize Public Finance Authorities

Ennobling & Exhilarating

Institutionalize Public Finance Authorities

Create and Capture Value Streamline Project Delivery Develop Dynamic Data and Traffic Management Platforms

Equitable & Accessible

Streamline Project Delivery Develop Dynamic Data and Traffic Management Platforms

Carbon Neutral

Equitable & Accessible Carbon Neutral

Optimize Transit Systems

Safe & Secure

Harness New Technology

Redesign Goods Movement Systems Plan Ahead for High-speed and Intercity Rail

Ennobling & Exhilarating

Create and Capture Value

Optimize Transit Systems Harness New Technology

Free-Flowing

Pay the Actual Cost of Congestion

Safe & Secure

Redesign Goods Movement Systems

Sustainable Growth

113

Plan Ahead for High-speed and Intercity Rail

Sustainable Growth

114

Thank You! We are extremely appreciative of the time and energy provided by our talented advisory panelists! We would like to take this opportunity to thank: Rich Barone, RPA Kip Bergstrom, Rebooting New England Mortimer Downey, WSP Emil Frankel, Eno Center Foster Nichols, WSP Peter Peyser, Peyser Associates

Mark Pisano, USC Karen Rae, Empire State Development David Seltzer, Mercator Advisors Jim Simpson, China Construction Lyle Wray, CRCOG

And special thank you to our studio leaders, Professors Marilyn Taylor and Bob Yaro!