Study of US 43 Corridor Between I-20/I-59 near Eutaw to I-65 at Mobile

December 2003 - produced by AECOM Consulting

Project Type: Connectivity between cities and a rural area

Project Objectives: Promote and accommodate commercial development within a rural area from improved accessibility

Outcomes Metric: Attraction of new industries, including development of tourism and retirement potential that will lead to increased population and jobs

Economic Environment: Rural

Economic History: Declining population (outward migration) and high unemployment

Distinguishing Features: This deeply impoverished, largely rural area is working to identify new types of industrial growth in order to transition away from its reliance on resource-related industry.

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I.       Existing Conditions

The US 43 corridor traverses the heart of the "Alabama Black Belt" passing through or near Greene, Sumter, Marengo, Hale, Choctaw, Wilcox, Clarke and Washington counties. ^[1] These seven counties comprise the study region from the perspective of connections with US 43 and/or dependency on forest products for major employment in the vicinity of the corridor. In conjunction with I-20/I-59 the corridor links two industrial centers, Tuscaloosa and Mobile. The 2000 Census populations of these cities were 78,265 and 198,887, respectively. In contrast the largest centers of population along the US 43 corridor between I-20/I-59 and I-65 are Demopolis (7,685 population), Thomasville (5,609 population) and Jackson (4,575 population).

This is a deeply impoverished rural area where the industrial base has not yet developed beyond that related to its traditional resource specialization. The region between I-20/I-59 and I-65 at Mobile is particularly known for its large forest reserves. The region's lack of success in developing or attracting industries beyond those related to its traditional resource base limits its potential for economic growth and the economic opportunities of its residents.

Reflecting the limited opportunity within the corridor economy, the region has had a relatively stagnant population for decades due to net out-migration. The region is now smaller than it was 30 years ago. The population of the seven counties was 131,320 in 1970, increasing to 134,870 in 1980 and then declining to 132,195 in 1990 and 128,607 in 2000.

Exhibit 1 contains the seven counties' 1990 to 2000 population changes in comparison with the U.S. and Alabama. U.S. population increased 13.1% between 1990 and 2000 while Alabama grew slightly less at 10%. For the U.S. 43 study region, only two of the seven counties had population growth, Clarke and Monroe. Losses among the other counties more than offset the gains in Clarke and Monroe. The region as a whole had a 2.7% decline in population, concentrated in Sumter County, Wilcox County, and Marengo County.

Exhibit 1: Population and Growth for the U.S., Alabama and Seven Counties

Location	1990 POP	2000 POP	Change	% Change	Rankings
U.S.	248,825,735	281,421,906	32,596,172	13.1	In Al [2]	In US [3]
AL	4,040,587	4,447,100	406,513	10.06		23 [4]
Sumter	16,174	14,798	-1,376	-8.51	57	2,103
Wilcox	13,568	13,183	-385	-2.84	63	2,213
Clarke	27,240	27,867	627	2.3	40	1,454
Monroe	23,968	24,324	356	1.49	43	1,582
Choctaw	16,018	15,922	-96	-0.6	55	2,025
Marengo	23,084	22,539	-545	-2.36	46	1,668
Greene	10,153	9,974	-179	-1.76	67	2,449

Source: Census Bureau, 2000

Employment trends in the corridor mirror the region's population growth. Total employment in the region was 51,120 in 1980 and was virtually the same in 1990, 51,356, but then declined to 49,096 by 2000. Only Clarke County had more jobs in 2000 than 1990, an increase of 189. The other six counties have fewer jobs in 2000 than 1990, led by Marengo, Sumter and Choctaw counties. Thus while the national economy was enjoying the longest and strongest economic expansion on record, the economy of the U.S. 43 corridor shrank.

Exhibit 2 contains 1990 to 2001 unemployment rates for the U.S., Alabama and the seven counties. The data show that from 1990 to 2001 the average unemployment rate in Alabama was generally higher than the national average unemployment rate. Furthermore, unemployment rates in the seven counties are considerably higher than both the U..S and Alabama statistics for the same period. Although unemployment rates in the U.S. reached a peak in 1992 and declined gradually afterwards, unemployment rates subsequently increased in the counties, except Wilcox over the same period. Towards the end of the period Marengo County's unemployment rate had converged with that of the U.S. and Alabama. However, the other six counties retained distinctively higher unemployment rates, nearly double those of the U.S. and Alabama between 1998 and 2001.

Exhibit 2: U.S., Alabama and the Seven Counties Unemployment Rates

Source: Alabama's Comprehensive Labor Market Information System. www2.dir.state.al.us/aclmis/

Stagnant or declining populations, employment and substantially higher unemployment compared to Alabama and the U.S. suggest a region with very low income and high poverty rates. The 2000 median household income for the U.S., Alabama and the seven counties indicates that Alabama median household income was 81.29% of the U.S. value. However, the median household money income was distinctively less than the U.S. for the seven counties, ranging from 69.28% forMonroe County to 39.64% for Wilcox County. The region had distinctively lower median household money incomecompared to Alabama, ranging from 85.23% of Alabama for Monroe County to 48.77% of Alabama for Wilcox County.

Generally the seven counties have percentages of population below poverty as much as double the U.S. and/or Alabama. The population poverty percentages range from 21.30% for Monroe County to 39.90% for Wilcox County. The percentages of population below the poverty line in the U.S., Alabama and seven counties in 2000 indicates that for the U.S. 12.40% of the population was below the poverty line, compared to 16.10% for Alabama.

The major employment sector in the corridor is manufacturing and this core part of the economy is in decline. U.S. manufacturing employment declined at an average annual rate of 0.30% between 1990 and 2000 while Alabama manufacturing employment declined at more than double the US pace (0.67%). Aside from Marengo County, which had growth in manufacturing employment (1.12%) and Clarke County, which had a small decrease (-0.13%) between 1990 and 2000, the other counties had substantially greater percentage reductions in manufacturing employment compared to the U.S. and Alabama. Manufacturing employment declined at average annual rates substantially greater than the US and Alabama in Sumter (-4.67%), Wilcox (-3.88%) and Choctaw (-3.81%) counties. Manufacturing employment declined in Greene (-1.46%) and Monroe (-1.02%) counties nearly double that of Alabama.

II. Highway Project

The proposed improvements to U.S. 43 would replace and/or upgrade the existing right of way to Interstate highway standards between I-20/I-59 near Eutaw and connecting to I-65 at Mobile. The project is similar to the proposed West Alabama Freeway concept that would traverse Mobile, Washington, Clarke, Choctaw, Marengo, Sumter, Hale, Greene and Tuscaloosa counties to link I-59 at Tuscaloosa with Mobile, a distance of approximately 175 miles. The corridor is shown in Exhibit 3.

Exhibit 3: U.S. 43 Corridor and Major Highways and Interstates in Alabama

III. Objectives of the Project

The primary objective of the corridor project would be to open the region up to four-lane accessibility so that it would spur interest in developable sites that have access to the rest of the Interstate highway system that currently lies well beyond reasonable reach of much of the region. Specifically, the U.S. 43 corridor project and the parallel West Alabama Freeway concept have the objective of providing modern north-south highway access to a region that is largely removed from the prevailing pattern of east-west Interstates that border the region, I-10 at Mobile and I-20 at Tuscaloosa, and the north south Interstates that are more distant from the region, I-65 in Alabama and I-59 in Mississippi. The large void between the I-20, I-10, I-65 and I-59 routes is served primarily by two-lane north-south roads that do not connect the region efficiently or effectively to the existing Interstate system. The absence of four-lane and or Interstate highway accessibility is viewed as the primary cause of the region's isolation and lack of development.

IV. Coordination of Project with other Economic Development Strategies, Plans and Opportunities

In Alabama, outside of the Metropolitan Statistical Areas, there is no recognized rural transportation planning expertise other than Alabama's Department of Transportation. Rural planning, including economic development, is normally done at the regional level by the planning commissions. For the seven-county study region there were two regional planning bodies with jurisdiction, the West Alabama Planning and Development Council (WAPDC) located at Tuscaloosa and the Alabama Tombigbee Regional Commission (ATRC) located in Wilcox County at Camden, Alabama. The WAPDC includes Greene County along with Hale and Tuscaloosa counties. The ATRC includes Choctaw, Clarke, Marengo, Monroe, Sumter, and Wilcox counties along with Conecuh, Dallas, Perry, and Washington counties.

The local rural communities frequently do not have any economic development funding, staff or plans. The same situation often exists at the county level as well. The general pattern is to look to the regional development commissions to have expertise in economic development for planning purposes. At the local level the primary points of contact for economic development are the elected officials, particularly mayors. They are normally augmented by chamber of commerce resources that serve as support functions. Professional economic development resources are scarce.

The general absence of economic development resources is reflected by the lack of any current economic development plans, targets, or programs. Only recently have the five communities in Clarke County (Thomasville, Coffeeville, Grove Hill, Jackson and Fulton) begun to work cooperatively at the county level. This has been followed by the beginning of a regional approach across county lines to address economic development.

The region has not done any economic development plans or strategies particular to U.S. 43 or other highways. At this stage, the economic development focus is preliminary, conceptual and yet to be implemented with funding and further development of a regional consensus across political lines. The region has taken first steps down a long path toward developing consensus and resources to promote the region of which highway access is one major element.

V. Methodology

Industry surveys confirmed a general sense of optimism that U.S. 43 improvements would increase accessibility sufficiently to enable the region to be considered by industrial developers. However, no particular target industries were identified based on the region's resources, other than warehousing and distribution along existing I-20/I-59 corridor tangential to the region. There is a well-developed inland waterway contiguous to the region at the western edge of Alabama. Improvement of U.S. 43 is regarded as important to provide accessibility to existing ports and potential industrial sites. The major existing industry base, forest products, is viewed as very slow growing and generally not susceptible to expansion on account of improved highway access. The auto sector was championed as the most fashionable of the latest wave of industrial development in Alabama. Unfortunately, lacking the prospects of four-lane access within the time frame of Hyundai development puts the region on the fringes of being able to attract its share of the auto suppliers that will reside with existing Alabama counties that have four lane access to Hyundai.

Absent consensus within the region about what industries would be most desirable to attract and most likely to succeed, a series of industry studies were undertaken to articulate the development potential of the region and how highway improvements might support that effort. The major themes of the industry studies with regard to highway improvements and increased use of U.S. 43 are as follows: (1) existing users who are not principally affected by U.S. 43 improvements; (2) prospective users who may be influenced by U.S. 43 improvements on their market that is external to the corridor and is not defined and developed at this time; and (3) prospective users who may be influenced by U.S. 43 improvements on their market that is internal to the corridor and is not defined and developed at this time. Brief summaries of the findings follow.

Existing Users Largely Unaffected by US 43 in Terms of Development

This category includes use of U.S. 43 as an alternative regional truck route, development of forest products manufacturing and agriculture other than forestry or pasture. Commercial vehicle traffic patterns along major Interstates in the region compared with driving times and distances suggest that an improved U.S. 43 corridor would not provide appreciable time savings for interregional truck traffic. However, improvements to U.S. 43 would make the region more accessible as part of a through routing that would have similar driving times and distances compared to other Interstate routes such as I-65. Improvements to U.S. 43 would also open up the region to changes in intra-regional traffic such as between Birmingham and Mobile.

Existing forest products industries located in the region are drawn by timber supply. Highway access is not the primary driver of industrial location or expansion of these firms. In addition, the majority of the industry's output is domestic and does not require port connections that would involve U.S. 43. Very little expansion of the existing forest products firms is anticipated for the near term (three to five years) because of depressed demand and overcapacity. It is possible that one or more large engineered forest products mills will locate in the region providing a substantial increase in manufacturing employment. However, the timing of such an investment is driven by market conditions and timber resources and largely unrelated to improvements to U.S. 43.

Agriculture other than forestry and pasture remains an untapped resource for the region. It is possible that potential growth at the Port of Mobile through a recently announced freezer facility, as well as the possibility of additional cold storage capability, could induce poultry shipments to shift from South Atlantic ports such as Savannah. This could make the U.S. 43 corridor region more attractive to local poultry production. This would be contingent on expanding the export market and Port of Mobile's participation in this trade.

Prospective Users Who May Be Influenced by U.S. 43 But Whose Market is External to the Corridor and is Not Defined and/or Developed at This Time

This category includes planned or prospective development at the Port of Mobile to accommodate new cargoes, container and cruise vessels. Both the container facility and the cruise facility are in the planning stages at this time with prospective development contingent on a number of factors, including some significant variables external to the Port of Mobile. The timing of development of these new business sectors is by no means certain. It is envisioned that a container port facility will be operational no later than 2005. Cruise vessels calls have been announced at Mobile beginning in the 2003 season.

The container markets envisioned by the Port would be largely served by rail intermodal connections. Trucks would handle only a small portion of the Port's forecasted capture of long-distance container traffic to and from major hinterland cities such as Chicago. The major domestic markets for containerized cargo for the Port, excluding Mobile, are outside of Alabama. Although U.S. 43 improvements would make the Port more accessible to Tuscaloosa and portions of Birmingham, these are comparatively small markets for containerized foreign trade. While it is entirely possible that new markets for containers in this region could arise, the volume of containers to be handled by an improved U.S. 43 corridor is likely to be very small for the foreseeable future.

The cruise passenger markets are more promising than the container sector based on individuals driving to Mobile for homeport cruise calls. This market is in its infancy at this time and would compete heavily with existing established cruise facilities at the New Orleans and Florida ports. To the extent that Mobile could attract a cruise vessel(s), U.S. 43 improvements would provide an alternative access for Mobile that would be generally competitive with I-65 for routes north of Birmingham. Therefore, it is likely that an improved U.S. 43 would be able to attract some passenger traffic related to the prospective development of a cruise port call at Mobile. The traffic would likely be seasonal for six months of the year and limited to one vessel at least in the early stages of development pending a dedicated cruise facility at the Port.

Prospective Users Who May Be Influenced by US 43 But Their Market is Internal to the Corridor and is Not Defined and/or Developed at This Time

This category includes potential retirement and tourism markets for the region. U.S. 43 improvements are regarded as essential to make the region accessible and promote its natural resources for retirement and tourism markets. At this time, both markets are prospective and contingent on a number of developments that must collectively materialize in the region to make it attractive to retirees and tourists. On its own, U.S. 43 improvements will not be sufficient to spark retirement or tourism market development. The leaders in the region are cognizant that a number of improvements are required related to quality of life such as medical care and public recreation. that would serve as threshold inducements to attract retirees and tourists in conjunction with improved highway access.

If U.S. 43 is not improved, it is doubtful that retirees and tourists can be attracted to the region. However, if US 43 is improved is it also doubtful that retirees and tourists can be attracted to the region without other basic infrastructure, which is currently lacking.

Lessons Learned from Other Corridors: US 45 in Mississippi and Automotive in Alabama

Acting on input from the Advisory Committee, the study team reviewed the status of the U.S. 45 corridor in Mississippi. Mississippi has pursued a state financed four-lane highway improvement program designed to promote economic growth using highways for accessibility. Over the course of the last fifteen years most of U.S. 45 in Mississippi near the Alabama border northwest of Mobile to the Tennessee border north of Tupelo has been widened to a four-lane highway, bypassing towns and allowing with some exceptions speed limits comparable to the Interstate system.

Efforts to determine a statistical relationship between increased population and employment in rural and urban sectors served by the US 45 corridor were not successful. However, it is clear that in most instances population and employment have grown-even setting aside the renowned example of Tupelo-in Mississippi at a much greater rate than the stagnation and/or declines observed in the US 43 Alabama study counties.

Interviews with Mississippi economic development officials confirm a consensus exists that little or no industrial development can be expected to occur without good four-lane highway access. Although Mississippi has had some difficulty selling the four-lane highway in deference to Interstate highways, proximity and routes can be deciding issues for firms that do not need Interstate exposure or immediate access.

Economic development officials in Mississippi maintained that four-lane highways were an essential first step to get communities and counties working cooperatively and for economic development for the region to occur. Without four-lane access they related that little economic development could be expected. [5] However, without community cooperation, including leadership and professional guidance, little can be done with only four-lane highway access. They view four-lane highways as the first of a series of economic and community development steps to advance the quality of life in the region and to promote and attract target industries and groups.

The study team investigated the location of automotive suppliers in Alabama and three other states: Georgia, Kentucky and Mississippi. The existing U.S. 43 corridor has a very remote likelihood to attract auto suppliers without continuous four-lane access to the auto assembly plants in Vance, Lincoln and Hope Hull, Alabama and Canton, Mississippi. Discussions with the auto industry, and analysis of an inventory of all suppliers located in Kentucky, Georgia, Alabama and Mississippi confirm that four-lane highway access is regarded as essential for most suppliers with an emphasis on Interstate highways for the largest suppliers.

A statistical analysis of auto supplier locations in Alabama counties and the miles of four lane highways yielded a very high positive statistical correlation. The correlation was used to allocate the 120 estimated new Hyundai suppliers that are projected to locate in Alabama. The U.S. 43 corridor counties are in the 150 mile suggested radius of supplier locations from the Hyundai plant location at Hope Hull south of Montgomery off I-65. In the status quo scenario, U.S. 43 has 65 route miles of four-lane in Washington and Clarke counties. A strict application of the regression coefficient would show these counties could attract up to 7 suppliers. However, the absence of any continuous direct four-lane access to Hyundai negates the prospects that auto suppliers would be attracted to the existing four-lane segments of the US 43 corridor. Unless the region has direct four-lane highway access to the Hyundai facility (or other auto assembly plants or suppliers) it cannot expect to attract this industry.

Improving U.S. 43 between I-65 and I-20/I-59 resulted in 170 miles of four-lane highway enabling a total to 17 suppliers to be potentially attracted based on the regression coefficient. However, the lack of any continuous four-lane access to the Hyundai plant again eliminates serious consideration of the corridor even when improved to four-lane access between I-65 and I-20/I-59.

Improvements to U.S. 80 east of Demopolis at Uniontown and near Selma would allow for a continuous four-lane corridor from an improved U.S. 43 to Hyundai. Under these conditions the regression projects that U.S. 43 could attract up to 17 Hyundai suppliers other things equal. The statistical analysis most likely represents an upper bound of the estimate of the number of Hyundai auto suppliers that could be attracted to the U.S. 43 corridor with highway improvements, other things equal. Based on an average of 50 employees per supplier the U.S. 43 corridor could attract up to 850 jobs based on the potential for 17 suppliers.

Discussions with the auto industry representatives in Alabama, as well as other states, indicated that four-lane highway access was in most cases a necessary condition to begin to attract auto suppliers. However, highway access cannot be used to compensate for lack of labor, quality of life and other considerations used by auto suppliers that seek rural areas and lower labor costs.

Development of U.S. 43 to Promote Employment in the Region

Absent specific market opportunities, a series of "job attraction" scenarios were postulated to scope the magnitude of the development issue at hand. The current employment base of the region is nearly 50,000, essentially stagnant or slightly declining over two decades. If the region grew similar to the U.S. 45 corridor counties in Mississippi, employment would increase at an average annual rate between nearly 0.5 to 1.0 percent. This would be tantamount to between 250 to 500 new direct jobs per year being brought to the region.

The cumulative number of jobs developed in the region over twenty years was estimated based on attracting 250 to 500 new jobs to the region per year as a response to improved assess from highway improvements. Total jobs attracted to the region over twenty years would be between 5,000 (250*20 = 5,000) to 10,000 (500*20 = 10,000).

Estimated Cost of US 43 Improvements

Exhibit 4 contains segment distances and estimated costs for replacing U.S. 43 with an expressway built to Interstate highway standards based on $10 million per mile or widening the existing two-lane sections between Thomasville and I-20/I-59 at an estimated cost of $3 million per mile. [6] The replacement cost for all of U.S. 43 between I-20/I-59 and I-65 would be nearly $1.6 billion. The existing two-lane section between I-20/I-59 and Thomasville could be replaced at an estimated cost of $740 million or alternatively widened to four lanes at an estimated cost of $220 million.

The auto-manufacturing sector in Alabama was used as a benchmark for public incentives to achieve economic development. The estimated weighted average cost of public incentives to the three recent automotive assembly manufacturers locating in Alabama is calculated to be $117,745 per direct job. [7] Augmenting U.S. 43 with a parallel Interstate Expressway based on auto incentives per direct job would require between 6,000 to13,000 new jobs to be attracted to the region exclusive of multiplier effects for the I-20/I-59 to Thomasville and I-20/I-59 to I-65 segments, respectively. Over twenty years the average annual number of jobs attracted to the region would need to be between 300 to 650 jobs. This growth in employment is consistent with the application of the Mississippi U.S. 45 employment growth ranges (250 to 500 jobs per year attracted to the region) above. The public incentive equivalent for widening U.S. 43 from two to four lanes between Thomasville and I-20/I-59 (which would cost about 30% as much as the $10 million per mile estimated for an Interstate artery) would require nearly 1,900 new jobs to be attracted to the area (refer to Exhibit 4).

The estimated cost of new construction improvements to US 43 (I-20/I-59 to Thomasville or I-65) compare favorably with the cost of public incentives for the auto sector assuming that increased highway access would result in attracting between 300 to 650 new jobs to the region annually for twenty years. [8] This is a bold leap for a region that has not grown but has declined as basic industries such as textiles departed or stagnated such as forest products. Alternatively, widening the existing two-lane section would require attracting nearly 100 jobs to the region annually for twenty years.

Exhibit 4: U.S. 43 Estimated Costs for Expressway and Widening and Equivalent Auto Sector Direct Jobs from State Incentives

From	To	Distance (Miles)	AL = $10 M/mile	AL Equivalent	AL = $3 M/mile	AL Equivalent
			Cost ($000,000) (New construction)	Auto Jobs	Cost ($000,000) (Widening)	Auto Jobs
I-20/I-59	Demopolis	30	$300	2,548	$90	764
I-20/I-59	Thomasville	74	$740	6,285	$222	1,885
I-20/I-59	Grove Hill	91	$910	7,729	na	na
I-20/I-59	Jackson	106	$1,060	9,003	na	na
I-20/I-59	I-65	158	$1,580	13,419	na	na

Source: AECOM Consult

Notes: Expressway average total costs assumed to be $10 million per mile. Widening costs assumed to be $3 million per mile based on US 45 in Mississippi. Widening would affect existing two lane sections from Thomasville to I-20/I-59. AL Auto Equivalent Jobs based on $117,745 average total public incentives per direct job for Mercedes, Honda and Hyundai

VI.              Summary

The overall results suggest that the region cannot grow without highway improvements that address the lack of four-lane access, which thwarts development unrelated to the region's extensive forest reserves. However, highway improvements alone will not be a panacea for the region. Highway improvements are part of an initial step that would allow the region to seek development opportunities that are currently unattainable. These would include development of retirement communities, tourism and low-tech manufacturing. It is not likely that all of these developments if fully exploited would impact the region with an average of 300 to 600 new jobs per year for twenty years commensurate with creation of automotive assembly jobs with public assistance. Yet without highway improvements it is a virtual surety that none of these developments will occur.

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[1] Although there is no official designation the "Black Belt" region of Alabama is normally identified with the poorest counties in the south and western parts of the state typically consisting of: Bullock, Butler, Choctaw, Clarke, Dallas, Hale, Greene, Lowndes, Macon, Marengo, Perry, Pickens, Sumter, Washington and Wilcox counties.

[2] Alabama County Rankings are out of 67

[3] United States County Rankings are out of 3341

[4] United States State Rankings are out of 50

[5] Tupelo was candidly noted as an exception to the prevailing notion that rural areas not served by four-lane highways will lack the same opportunities for development as rural areas served by four-lane highways, other things equal.

[6] $10 million per mile for new Interstate freeway in rural areas reflects AL DOT estimates for all road development expenses, including right of way. $3 million per mile for widening from two to four lanes is derived from expenditures in Mississippi to widen and or bypass two lane sections of US 45 with four lanes (refer to "Mississippi Moving A.H.E.A.D.: 1987 Four-Lane Highway Program Annual Report June 2002".

[7] Alabama State University, US 80 Corridor Improvements for Local Industrial Development and Tourism, Task 5, page 30 (February 28, 2003).

[8] Alternatively based on Exhibit 3 the estimated cost of widening US 43 between Thomasville and I-20/I-59 would compare favorably with the cost of public incentives for the auto sector assuming that increased highway four lane access would result in attracting an average of nearly 100 new jobs to the region per year for twenty years.