Showing posts with label Finance. Show all posts
Showing posts with label Finance. Show all posts

Friday, June 14, 2013

OpEd | National | High Speed Rail: How Much More Convincing Do We Need?

Many of my classmates have already talked about the need for investment in a national High Speed Rail (HSR) system. It is a much-discussed topic in urban planning and transportation classrooms. HSR even has a cheerleader at the very top level, in US Department of Transportation Secretary, Ray LaHood. "This is what the American people want. If you build it, they will come," LaHood declared (Chapman, 2011)." So what will it take to convince our legislators that the time to invest in HSR projects is long overdue?   

Opponents say that no amount of ridership will cover the initial cost of creating the infrastructure, nor the continued cost of operations and maintenance. “No mass transit system in the country charges riders enough to offset the expenses of running trains—much less the cost of capital. Amtrak loses hundreds of millions a year,” says author Steve Chapman (Chapman, 2011). It’s true, trains are expensive business. They fail to acknowledge, however, the fact that every other mode of transportation in this country enjoys subsidies of one kind or another. Though President Obama did pledge to spend $13 billion in federal stimulus funds over five years to seed America’s first HSR projects, the federal government hasn’t spent that little on highways in one year since 1958 (Selcraig, 2010). Auto subsidies are simply a prevailing fact of our culture, with federally-funded road maintenance as well as mandated parking spaces taking up precious urban real estate. And we all remember when the entire national auto industry had to be bailed out on the public’s dime. Locally, much-need improvements in bike infrastructure was able to be funded by pairing the work with storm water management projects. Meanwhile, the government has provided $4.64 billion in taxpayer funds to the airline industry for cash grants and $1.65 billion in loan guarantees (Surjaputra, 2008). Yet none of these modes of transport can equal the benefits that HSR can bring.

Monday, June 10, 2013

OpEd | State | TriMet angers many, requires oversight

Photo credit: KGW.com

Did you know that TriMet fares are now among the highest in the nation (Gianola, 2013)? That’s right, a monthly adult TriMet pass is $100, while in Philadelphia, its $83, $72 in Los Angeles and just $70 in Boston (Gianola, 2013). Yet all three cities have operation far more extensive than Portland’s. So why does public transit cost so much in Portland? TriMet General Manager Neil McFarlane wants you to blame the recession and the high cost of TriMet’s union health benefits (Gianola, 2013). He hoped you wouldn’t find out about the $910,000 in pay raises he approved for the highest echelon of TriMet management in 2012, even as he publicly stated that he had frozen their pay (Rose, 2013). “How could this happen right under our noses?” you may ask. This was able to happen because no one was watching. While TriMet management increased fairs, cut service, and gave themselves raises, no one was paying attention. To ensure this can’t happen again, Oregon lawmakers have called on Secretary of State Kate Brown to conduct an unprecedented audit of operations and finances at the state's largest public transit agency (Rose J. , 2013).

Vice-chair of the House Committee on Transportation and Economic Development, Rep. Chris Gorsek (D-Troutdale) is the chief sponsor of the proposal, an amendment to his House Bill 3316. HB3316 was intended to regulate TriMet’s governance, transferring operational and finical oversight from TriMet’s board of directors to Metro (Staff, 2013). However, Gorsek simultaneously realized he didn’t have wide support for restructuring and became aware of major management issues at TriMet. He took the opportunity to push for a large scale audit instead (Rose J. , 2013). While the audit will possibly take longer than the original plan - Brown's office plans to have the audit finished before the 2014 legislative session (Thompson, 2013) – it ensures a much more thorough understanding  of exactly what is going on inside the transit agency and why. This is an extremely prudent step, prior to taking any major action which could have unforeseen repercussions. While it’s obvious that things need to change inside TriMet, I believe it’s worth taking the time to do it right.


Obama’s down with PPP… and so are we?

Tunnel Boring Machine at PortMiami
As we all know, federal funding for transportation infrastructure projects is a thing of the past. The recession of 2008 still lingers in the federal budget cuts and the resistance to raise user-base fees. The primary funding source for transportation projects, the highway trust fund, has seen rapid decline in recent years due to lower vehicle miles traveled and stagnant gas tax rates. While there seems to be no money for transportation, there has never been a time when transportation is so in demand. State and local governments are struggling to keep their current systems in good condition, while also trying to fund new and innovative transit technologies. This disconnect is reason enough for the federal government to start taking action. This action has taken the form of public-private partnerships (PPPs).

Sunday, June 9, 2013

National Op Ed: Transportation Funding



Transportation funding is a nationwide mess; there is no getting around it.  Federal and state funding has been drying up across the country gradually for several decades as inflation has risen and the gas tax has remained stagnant since the 1990’s.  Fortunately, this is partially due to the nation’s fleet becoming more fuel efficient and partially to overall driving slowly declining.  Unfortunately, the gas tax is the primary source of revenue for transportation infrastructure maintenance, enhancement and expansion. 

Friday, June 7, 2013

National Op-Ed - Create a Solid Foundation for Infrastructure in the 21st Century

The “Partnership to Build America Act” introduced by Congressman John Delaney finances the creation of transportation, energy, communication, water, and education infrastructure through the “American Infrastructure Fund” (AIF). The fund is seeded with repatriated corporate earnings and has a focus on fostering public-private partnerships. The American Society of Civil Engineers (ASCE) supports the bill, cautioning that “the nation’s deteriorating infrastructure will cost American families $3,100 annually in lost income and suppress the growth of the country’s Gross Domestic Product (GDP) by $3.1 trillion by 2020.” This is why it is essential for congress to find new, innovative ways to pay for infrastructure in America.  The AIF is just such a policy tool.

Saturday, May 25, 2013

Crowdfunding Local Community Planning: If we fund it, will they come?


It is safe to say that social media has changed the world. Never before have we been in instant contact with people from every country and continent. We receive up-to-date check-ins from our friends and family and also complete and utter strangers. It is no surprise then, that this ability to communicate with just about anyone has lead to the revolutionary idea of fundraising. What might be more surprising is that social media has helped reinvigorate local communities by allowing them the power to create their ideal city.

Okay, sure, technically fundraising is not revolutionary. It has been around since the invention of financing, but the idea of raising capital from private investors you have never met is pretty far-fetched. Welcome to the world of crowdfunding. We’ve all heard of it. Crowdfunding is being used to invest in emerging entrepreneurs in developing countries and that videogame/movie/iphone app you read about on Kickstarter. There are a slew of websites out there that can help anyone raise money for anything. Even a skyscraper.

Botoga's crowdfunded skyscraper            source: Plantizen.com

Tuesday, April 23, 2013

CRC and Evolving Transportation Funding


Over the past week or so there have been a number of articles written about Portland's own CRC project from an outside perspective. DC Streetsblog in particular has taken an interest with the recent press the CRC has received. Secretary LaHood's final appearance before the House and President Obama listed the CRC as one of the potential projects for New Starts funding. Regardless of your stance on the CRC, this is a prime example of a conflict between more traditional transportation planning and the evolving realities of funding today.

Sunday, April 21, 2013

Considering the Gondola (not the Venetian boat)


In a time when every public entity is trying to spend less and still provide adequate transportation options to its constituents, I found myself looking to the sky.  Intra-urban planes would be a bit overkill, and mimicking Sao Paulo’s 420 helipads (in the city!) is just too inequitable.  What I’m looking at is the gondola or aerial tram or Cable Propelled Transit (CPT).  It is fast becoming one of the most popular, least-used forms of urban mass transit in the world. There are only four cities in the world, according to The Gondola Project (arguably the global leader in CPT proselytization), that have truly integrated their CPT into their whole transit system: Caracas, Venezuela; Constantine, Algeria; Rio de Janeiro, Brazil; and Medellin, Colombia.  Otherwise, most cities have short, single, experimental or tourist-based lines like Portland’s aerial tram or the Rostok/ Munich lift that was disassembled in Rostok to follow a garden exhibition traveling to Munich.  However, more and more of these experiments are planting themselves all over the map, like the London Thames Cable Car; the urban gondola in Ordu, Turkey; or the Teléferico de Gaia in Portugal.  Why is this form of transit becoming popular?

Lessons in Local Transportation Finance




Last week I was fortunate enough to attend the American Planning Association Conference in Chicago. IL. I made it to nearly 10 sessions regarding transportation systems in our country and their future in American cities. Out of all the planners, engineers, think tanks and city workers that I saw present, no one was as real and poignant as Stephanie Pollack, Associate Director of the Dukakis Center of Urban and Regional Planning at Northeastern University. I heard Ms. Pollack speak at a session titled "The New Role of Local Transportation Funding," where I expected a few consultants and policy directors to tell us about the importance of sales taxes, property taxes, TIFs and special assessment fees. Out of the four presenters, three did exactly that. Ms. Pollack took a different approach. 

Monday, April 15, 2013

Federal Transportation Funding in Jeopardy?


The graph shared in class lecture illustrating VMT trends in the U.S. has many researchers wondering whether the dropping numbers will become a lasting trend or just a blip in a long term continual rise of miles driven. If this trend continues, many supporters of alternative transportation will be elated. However, it is important to realize that there also may be negative consequences and issues that arise if this trend were to continue.

Sunday, April 14, 2013

Review of Eric Jaffe's article

“The End of Federal Transportation Funding as we know it” provides historic information about the United States’ transportation systems. Many of today’s current challenges stem from the growing costs of transportation but it also covers the top down approach that has led to vague priorities and little direction for the future of transportation. The article addresses the debate over funding and whether or not the federal government should be a player.

The argument for decentralization states that road networks are very local and transportation needs are unique to every location. Engagement from state and local government allow for variation and effective modes of transit that meet the local needs. In addition, money generated within a state circulates more directly to its place of origin. Through referendums, state and local municipalities have found a way to generate the necessary funds to pay for projects.

Advocates for centralization focus on the importance of historical funding, and the necessary coordination for maintaining and creating infrastructure. In addition, there is a national interest in transportation, it is a basic service that some believe should be provided to everyone. A criticism about state and local funding is that it usually involves an increase in sales tax, which can be a backward approach. The backlash is that such projects have the potential to threaten transportation equity. These projects tend to maintain highways while leaving rail and public transportation with less funding and less importance. Federal involvement ensures that areas experiencing high rates of poverty will still receive the necessary money for its transportation needs.

Ideas of reform are addressed at the end of the article. Government funding is beneficial and much needed but a top down approach must change. The author uses Canada as an example where the state and local government take the lead on transportation projects with the help of federal money. Other ideas involve competitive funding and subsidies for successful projects. While the article tackles the issue of reducing central authority while increasing state engagement as well as maintaining roadways, it does not address social factors that contribute to current challenges.

There are many cultural beliefs that encourage Americans to drive cars instead of utilizing public transit; the conversation must incorporate an analysis of these attitudes in order to change to behaviors. Creating solutions involves acknowledging such behaviors that translate into costs and avoiding them. Instead of encouraging funding for freeways, both federal and local governments should provide competitive incentives for mass transit. Transportation equity needs to become a key player, a driving force that ensures the availability and stability of public mobility. The approach to transportation problems must include both social and political factors that shape the future of the United States’ mobility. 

Student reviewer for this post was Yunemi Jang.

Monday, April 8, 2013

Financing Denver RTD's FasTracks Plan

In the early 2000s, The Regional Transportation District (RTD) of the greater Denver area developed a very robust and ambitious plan to construct and operate more than 100 additional miles of commuter and light rail service throughout the region by 2017. Funding for what RTD calls FasTracks was supported by a 2004 voter-approved regional sales tax measure that dedicates 4 cents to every dollar spent to the project. This allowed the project to begin, however, due to an unexpected downturn in the economy and other unplanned financial constraints, RTD realized an additional sales tax increase was imperative.