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REMARKS FOR
THE HONORABLE MARY PETERS
SECRETARY OF TRANSPORTATION
INTERNATIONAL
BRIDGE, TUNNEL AND TURNPIKE ASSOCIATION TRANSPORTATION FINANCE SUMMIT
“NEW PARADIGMS IN SURFACE TRANPSORTATION FUNDING”
WASHINGTON, DC
DECEMBER 8, 2008
8:30 AM
Good morning. Thank you, Pat (Jones), for that kind introduction. I am very honored to receive the IBTTA’s Challenge award. I consider it a reflection of the work we have done together to increase safety, relieve congestion, and modernize America’s transportation system.
This Transportation Finance Summit – which features some great speakers – is a good example of the IBTTA’s leadership during what I believe is a pivotal time for our transportation system.
Whether it is congestion in our growing cities or the dwindling Highway Trust Fund, our transportation network faces challenges that require us to re-think the way we fund, build, and manage our infrastructure.
You are all familiar with the challenges. And many of you have been part of the paradigm shift in transportation that has been taking hold across the United States over the last eight years.
I think back to 2001, when I arrived in Washington to head the Federal Highway Administration. Back then, you didn’t hear much about new toll roads or Public Private Partnerships and congestion pricing. Today, with the active encouragement of the Bush Administration, that has changed.
At the Department of Transportation, we have developed model Public Private Partnership legislation and encouraged states to modernize their laws. A total of 25 states now have P3 authority, with eight states adopting P3 legislation in the last three years alone.
We have reached out to innovative municipal leaders with Urban Partnerships and congestion reduction grants, and they have responded with potent combinations of technology, pricing, and transit to fight congestion.
We have made aggressive use of private activity bonds and TIFIA loans and programs like Interstate Tolling, Corridors of the Future, and the Federal Transit Administration’s Penta-P Pilot Program to encourage states to engage the private sector in creative ways.
The results are telling. States like Indiana, Florida, and Texas are funding ambitious infrastructure programs today – without raising gas taxes or grabbing new federal earmarks. Instead, they are reaching out to the private sector, where they are finding eager partners.
Governor Mitch Daniels’ bold move to lease the Indiana Toll Road brought in $3.85 billion to fund the capital projects in the state’s Major Moves program – the largest roads program in the state’s history. Moreover, the private concern, Cintra, now has responsibility for upkeep of the 157-mile road, which was in need of costly maintenance and repairs.
Another good example is Virginia’s agreement with Transurban and Flour Enterprises on a new, $1.8 billion project that will add dynamically priced HOT lanes to the Capital Beltway – providing drivers an alternative on one of the most congested highways in the nation.
In fact, we recently concluded a comprehensive review of innovative financing projects in the United States. What the study found was that more transportation Public Private Partnerships have been completed over the last three years than in any comparable period in U.S. history. Another 20 major highway and transit projects involving partnerships with the private sector are at various stages in Colorado, Florida, California, Virginia, Texas, Mississippi, and many other states.
To help provide national leadership to states pursuing innovative and non-traditional transportation projects, we recently opened a new Office of Innovative Program Delivery within the Federal Highway Administration. The office will work with state Departments of Transportation to help them explore opportunities with innovative financing and congestion pricing and tap into the private funds available worldwide for investment in transportation infrastructure.
Of course, I recognize that the financial market is in upheaval right now. There are implications, one being that infrastructure just went from a safe investment to a smart investment. A year ago, a 5-to-6 percent return on transportation might have seemed modest compared to the double- and triple-digit figures being touted on mortgage-back securities and hedge funds. But in today’s environment, transportation represents an attractive investment – one that is literally backed in concrete. And when capital begins to flow again, transportation is a natural first place for those investment dollars to go.
That is why it is so important that we be ready with policies in place to attract investment and translate these good examples into a national strategy that will deliver fewer traffic tie-ups in the air and on the ground, better transit services, a stronger economy, and a cleaner environment.
It was with this goal in mind that the Bush Administration developed our comprehensive plan to overhaul our very approach to the nation’s highways and transit systems.
It is a plan that reflects many of the ideas that Pat and the IBTTA are advocating. And I am hopeful that it will help frame the much needed rewrite of our surface transportation laws by the new Administration and Congress next year.
Our plan refocuses the federal role and concentrates resources toward key, well defined areas of national interest – maintaining and improving the condition and performance of our Interstates and other key highways; making sure our roads and bridges are safe; and getting stalled traffic moving in our nation’s largest cities.
We reform federal programs to put more decisions in the hands of state and local leaders, cut wasteful federal spending and eliminate earmarks, and send tax dollars to programs that will actually make a difference. Instead of the 100-plus transportation programs that have sprouted up over the past two decades, we propose eight core spending programs that are as targeted as they are flexible.
We also pilot changes to the federal review process so it will not take 13 years to design and build new highway and transit projects. Moving people and protecting the environment do not have to be mutually exclusive.
And yes, we pave the way for renewing our transportation system by beginning the long overdue process of weaning ourselves from fuel taxes and adopting a more sustainable approach to funding.
This past year has dramatically highlighted the contradictions inherent in relying on gas taxes to fund surface transportation. September marked the 11th straight month that Americans have put fewer miles on their cars and trucks than the month before. And consistent with our national objective to reduce fossil-based fuel consumption, our vehicles are becoming more fuel efficient than ever.
But with Americans filling up at the pump less often, federal fuel tax revenues — the primary source of the Highway Trust Fund — have plummeted. The Trust Fund took in $3 billion less in fiscal year 2008 than in the previous year.
We must give states more options to use federally backed transportation loans, to create state infrastructure banks, and to attract the billions of private-sector dollars available for transportation projects. And we must remove restrictions on tolling on our Interstates and provide states with greater flexibility to implement electronic road pricing.
We have come a long way from the days when toll collection was limited to expensive, unsightly toll booths, accompanied by long lines and backups and frustrated drivers fishing for change.
Technology has given us high-speed, open-road tolling.
Thanks to your efforts, some 24 million drivers nationwide already are using transponders today.
They are traveling on fully automated, cashless roads like the Westpark Tollway in Houston without ever having to slow down.
They are experiencing reliable commutes on roads like California’s Highway 91 in Orange County every day thanks to congestion pricing.
And in cities like Atlanta, Minneapolis, and Miami, they are seeing stubborn bottlenecks relieved almost overnight – without building a single mile of new roadway. Thanks to sensor technology on HOT lanes and even on parking meters and in lots, the power of pricing is delivering faster commutes, better transit, and cleaner air.
But we are only just beginning to tap the potential of this simple but powerful technology.
So I would like to issue a challenge to the toll road operators here today. You hold the key to speeding the transition to open-road tolling, the key to attracting more investment, and the key to unlocking gridlock through dynamic pricing.
Open-road tolling equipment can be installed quickly and easily, and I am asking you to commit to making tollbooths obsolete in the United States of America by the time the next surface transportation authorization expires. Let’s send these relics the way of the horse-and-buggy.
Technology is opening the door to easier, more sustainable ways to pay for and build roads and transit systems – ways that deliver fewer traffic tie ups, better transit services, a stronger economy and a cleaner environment.
In order to compete in the 21st century global economy, this nation will need world-class transportation infrastructure – something we can only achieve by abandoning the methods we know do not work, and pursuing new ones that do.
The need to revolutionize transportation policy in America becomes more pressing each day. As we move forward, your leadership will be pivotal.
So thank you so much for inviting me to speak with you this morning, for honoring me with this special award, and for your tremendous contributions to making sure that the United States completes the transition to a 21st Century transportation policy that can keep our country competitive, our people mobile, and our infrastructure in good working order.
Let’s keep the momentum going! Thank you.
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