Remarks by Gregory G. Nadeau, FHWA Deputy Administrator

Freight in the Southeast Conference

Tampa, Florida

Wednesday, March 5, 2014 at 8 AM

I bring greetings from an old friend of many of yours, Victor Mendez.

As you probably know, Victor is serving as the Department’s new Acting Deputy Secretary.

I’m fulfilling Victor’s duties at FHWA, including having the privilege of representing him here today.

We’re in the middle of an incredibly important week for our transportation system.

During the course of this important week, President Obama and Secretary Foxx have shared their plan for addressing two of the nation’s most important priorities: the need to rebuild our transportation infrastructure so it continues to support economic growth and job creation, and the need to pay for it.

Last week, the President laid out his vision for a four-year, $302 billion transportation bill to help close what the Secretary has started calling an “infrastructure deficit” in this country – too many miles of road in need of repair, too many bridges old enough for Medicare.

Yesterday, the President released the details behind that proposal when he sent his FY 2015 budget to Congress.

Of the $302 billion requested by the President, $150 billion would come from savings generated from business tax reform.

The proposal would ensure the solvency of the Highway Trust Fund – something that would be in danger by the end of this summer without action by Congress.

By the way, the Department has started posting the Trust Fund balance on our website. We’re going to update it every month until the fund runs out of money or is able to sustain itself.

The American people, who drive on our roads and ship their goods on our system, deserve to see where things stand.

In terms of the highway program, the President proposes to increase funding by 22 percent per year, for a total of about $199 billion over four years.

It’s the type of bold investment we need to make if we’re going to meet the transportation challenges of the future, as our parents, grandparents and earlier generations did in building the Transcontinental Railroad, the Interstate Highway System and the Hoover Dam.

Unless we take action – and do it soon – we run the risk of squandering that inheritance.

Consider this: Since the early 1990s, the United States has consistently invested just six-tenths of one percent of our GDP in highway infrastructure – one quarter the amount invested by China.

Even countries with fairly “mature” infrastructures – like Canada, France and Russia – invest relatively more than we do.

The President’s vision puts us on a path toward solving that problem.

The proposal laid out by the President also recognizes the importance of freight movement to supporting job creation, trade and economic growth.

Even a workforce as talented and productive as America’s can’t succeed without an inter-connected system of highways, railroads, waterways and airways linking their products to markets around the corner and around the world.

In 2011, our transportation system carried 17.6 billion tons of goods valued at just less than 17 trillion dollars.

By 2040, we estimate the system will have to haul more than 28 billion tons – a 60 percent increase – valued at almost 40 trillion dollars.

To help meet that growing demand, the President proposes spending $10 billion over four years to improve our freight network through a multi-modal freight grant program in partnership with state and local governments, the private sector and labor representatives.

So here’s the bottom line. The President has offered a plan that will:

• Modernize our infrastructure;
• Ensure the health of our critical transportation programs;
• Support millions of good paying jobs;
• Give states and local governments certainty to plan and invest;
• Improve our global competitiveness.

And while the President has started the conversation, we welcome all good ideas that would help us reach those goals.

Secretary Foxx has committed the Department to working with members of Congress from both parties on a sustainable funding solution.

Chairman Boxer in the Senate and Chairman Shuster in the House are fully engaged in the debate and know as well as anyone that every day we fail to act, the cost of closing the infrastructure deficit goes up.

Because what’s true in business is true for infrastructure: Time is money!

We look forward to working with Congress to find a bipartisan solution to our transportation funding challenges.

FREIGHT PROVISIONS OF MAP-21

While Congress and the Administration debate the post-MAP-21 future, we’re busy implementing the provisions of the current transportation law.

Beyond the pressing need to invest in our infrastructure, there’s an equally strong need to invest with a sense of design and purpose.

MAP-21 made significant strides in that direction, especially in the area of freight, with its focus on strategic and performance-based investments in our freight system.

And so I want to take a few minutes to update you on the law’s most important freight provisions.

I believe the requirement to develop a National Freight Strategic Plan may be the most important one.

In a manner of speaking, it’s like Congress handed us a golden opportunity.

Our nation has never had a comprehensive freight plan to drive economic development.

We’ve never had a plan that takes into account how our roads and railways and ports and airports work as a system to move goods from factories to markets.

The Department and the industry are working together to take full advantage of that opportunity.

At DOT, we’ve created a Freight Policy Council made up of senior leadership from the Department and the modal administrations, including FHWA, FRA and MARAD. I’m the FHWA representative.

This council isn’t required under MAP-21, but the Secretary thought it was the best way to look at freight movement from a truly multi-modal perspective.

The Council has been working closely with the National Freight Advisory Committee on developing the all-important strategic plan. We call it NFAC for short.

NFAC is made up of 47 members who represent a range of viewpoints and interests affected by freight policy.

NFAC has met several times, including once by webinar, and has another meeting scheduled for later in March. And its subcommittees have been very active.

The collaboration between NFAC and our own Freight Policy Council is going to be very important as we continue to look at freight through the widest possible lens.

In terms of the highway part of the system, FHWA reached a milestone last November when we released a draft highway Primary Freight Network, an important tool for guiding future infrastructure investments.

We identified the roads that we think are critical to the efficient movement of goods. Both within the MAP-21 The comment period on the Network closed three weeks ago, and we’re in the process of reviewing those comments now.

We’ll publish our final designation, based on the comments we received.

Ultimately, this Network, and your feedback, will play an important role in the development of the Strategic Plan.

In the meantime, we’re also turning our attention to helping our Division Offices work with their state DOTs to designate the Critical Rural Freight Corridors.

Work in other areas continues to move forward.

• Performance measurement is probably the most challenging part of MAP-21, but the one that holds the greatest potential to help decision-makers invest our tax dollars most effectively.

  We’re publishing the proposed performance measurement rules in stages, with the freight rule scheduled to be issued later this summer.

  We did extensive public outreach to the freight community to help us develop this rule. Once it’s published there will be a public comment period of at least 90 days.

• The Truck Size and Weight Study continues to progress.

  We’ve completed plans and schedules for each of the five technical work areas. We’ve held two stakeholder input meetings and there’s a third planned for this spring.

  And we’ve started outlining the Study’s report to Congress.

• We’ve been working with stakeholders to refine the Jason’s Law truck parking survey, and we anticipate conducting the survey later this month.

  The results will be posted to a website.

Let me close by trying to put all of this in a bit of context.

We can do a lot to improve freight movement within the Federal-aid highway program alone.

The provision of MAP-21 that allows a higher federal match on eligible freight projects has attracted interest from a number of states. Two of the requests from Indiana have already been approved.

But our freight movement and our economy will benefit the most if we adopt a “systems approach” that looks at improving the connections among our land, air and water-based transportation systems.

We can no longer afford to have “tunnel vision” and think of freight investments in terms of our own modes.

Our very popular TIGER program has funded a large number of inter-modal freight projects.

Last week, President Obama and Secretary Foxx announced that $600 million would be available in a new round of TIGER grants.

And the President’s budget proposal would fund TIGER at $5 billion over four years, an increase of more than 100 percent.

But here’s the important point: Instead of looking at freight in terms of the federal-aid highway program, we need to consider where it fits into our larger economic and transportation policy.

We need to make sure all modes are working together to maintain a safe, efficient and reliable transportation system.

The new freight grant program would be an important step in that direction and make our approach to freight much less highway-centric.

A couple of weeks ago, I had the privilege of joining Secretary Foxx as he opened the new Stan Musial Veterans Memorial Bridge across the Mississippi River in St. Louis.

Marine highways like the Mississippi River play an important part in moving freight. And we encourage states to consider marine systems in their freight plans.

We also need to take into account how the pieces of our inter-connected system impact each other and what effect that might have on funding.

For example, if more freight moved by barge, how would it impact our roads? Would it reduce congestion? Would it help extend the life of our roads? Reduce maintenance costs? Make more money available for more projects?

We need to have those discussions as we address our transportation system as “one DOT,” not a collection of modes.

We look forward to engaging with you in that discussion.

CONCLUSION

Victor started a tradition at FHWA that I am very pleased to carry on.

He ended every speech – no matter the event or the group – with a reminder that of all the priorities we have in transportation, there is none more important than safety.

And so let me close by urging you to always buckle your seat belt, put away your cell phone when you’re driving, watch out for joggers, walkers and people riding bikes, and simply drive safely.

Thank you very much.

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