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What We’re Reading in Infrastructure, June 19

Friday, June 19, 2015

The staff of the Bipartisan Policy Center’s (BPC) Executive Council on Infrastructure share some recent publications, speeches, and testimony relevant to infrastructure policy and finance. The views expressed in these pieces do not necessarily represent the views of the council, its co-chairs, members, advisors or BPC.

Compiled by Nikki Rudnick, Katie Golden and Jake Varn


Dead End, No Turn Around, Danger Ahead: Challenges to the Future of Highway Funding
Senate Finance Committee hearing

Member Statements:

Witness Testimony:

  • Dr. Joseph Kile, Assistant Director for Microeconomic Studies Division, Congressional Budget Office – Testimony
  • The Honorable Ray LaHood, Senior Policy Advisor, DLA Piper – Testimony
  • Mr. Stephen Moore, Distinguished Visiting Fellow, The Heritage Foundation – Testimony

Testimony from former Sec. Ray LaHood:

“It is time to get serious and increase the gas tax. Proposals to do so have been offered by Democrats and Republicans alike in Congress. In particular I want to commend Senators Corker and Murphy as well as Representatives Blumenauer and Renacci for their vision and courage in offering such proposals.

“We must also look at a variety of other options such as establishing a National Infrastructure Bank, raising the cap on Private Activity Bonds, creating a new kind of tax-exempt municipal bond called Qualified Public Infrastructure Bonds, consider other user based funding mechanisms such as road user charges, and lift federal restrictions on tolling so that states may take greater advantage of partnering with the private sector.” View the full hearing.


Metro Modes: Charting a Path for the U.S. Freight Transportation Network
By Joseph Kane and Adie Tomer, Brookings Institution and JPMorgan Chase

“Trucks, railroads, waterways, airports, and pipelines represent the foundation of the country’s freight infrastructure network. Yet mounting congestion costs and tight investment budgets require that we prioritize freight investments. Understanding the types of goods moved by each mode—and the major industries supported by these movements—is a crucial step for regions to take to address their freight challenges.

“This report illustrates how trucks frequently serve as a backbone for the nation’s entire freight network, but also reveals how several other modes are essential to support the exchange of specific goods between metropolitan markets.” Read the full report.


Strategic Infrastructure: Mitigation of Political & Regulatory Risk in Infrastructure Projects
By The World Economic Forum

“To encourage sustainable economic growth, the global infrastructure program depends on private investors and operators – but they worry about political & regulatory risks. There are many facets of those risks beyond outright expropriation, such as delayed permits and community protests, unfair tax law changes, and corruption. This new World Economic Forum report, developed in collaboration with BCG, provides a 20-point risk-mitigation framework, listing promising measures for public and private stakeholders alike. It shows how a predictable and transparent regulatory environment can spur urgently needed investments into infrastructure to benefit societies at large.” Read the full report.


The Great Port Mismatch: U.S. Goods Trade and International Transportation
By Adie Tomer and Joseph Kane, Brookings Institution and JPMorgan Chase

“America’s international ports—the water, air, and surface transportation facilities that handle global goods—are either the first or last place a good touches domestic soil, and therefore they are vital components in trade networks. With towers of containers sitting on docksides, flocks of cargo planes parked at airports, and lines of trucks on both sides of the borders, ports are often the clearest visual evidence of all the goods trade taking place across the country.

“While ports are a vital conduit between the international marketplace and domestic producers and consumers, there is an information gap when it comes to ports’ specific role in the country’s trade networks. As a consequence, public policy tends to treat ports as infrastructure facilities that serve only their surrounding place, rather than as shared assets upon which dozens of metro areas across the country rely. This approach fails to take a holistic view of trade infrastructure and limits the coordination of fixed investments and commercial trade policies.” Read the full report.


The United States: The World’s Largest Emerging P3 Market
By Dan McNichol, AIG

“The tectonic plates necessary to recreate a robust, sustainable, market for public-private partnerships (P3s) are beginning to shift into place. Dilapidated infrastructure, significant budgetary shortcomings and growing political will among elected officials have created an emerging P3 market inside the United States. As communities attempt to confront current economic challenges, P3s are steadily becoming a viable delivery mechanism in the financing of civic projects, especially large, complex undertakings in the transportation sector. But this brings new challenges along with new opportunities.” Read the full report.


Hearing on Long-Term Funding of Highway Trust Fund
House Ways and Means Committee hearing

Witnesses

  • Bill Graves, President and Chief Executive Officer, American Trucking Association – Testimony
  • Robert Poole, Director of Transportation Policy and Searle Freedom Trust Transportation Fellow, Reason Foundation – Testimony
  • Chad Shirley, Deputy Assistant Director, Microeconomic Studies Team, Congressional Budget Office – Testimony

Statement from Representative Earl Blumenauer (D-OR):

“We’re not keeping up our end of the bargain for the 50 percent of capital spending on big projects that comes from the federal government. We haven’t made any meaningful adjustment since 1993 to the gas tax, relying on short-term fixes, gimmicks – and no matter how you slice it, adding to the deficit.” Read the full statementView the full hearing.


A fix for New York’s infrastructure straitjacket
By Michael Likosky, Crain’s New York Business

“New York City faces a seemingly intractable infrastructure crisis. The Metropolitan Transportation Authority is $14 billion short on its capital plan. Our water system is 70 years old. Our power system fails. Our trains crash. We’re paralyzed by storms.

“A less-discussed crisis is our provincial thinking on infrastructure. New York is, without a doubt, the pre-eminent global city. However, its connection to the world beyond its borders remains constrained, its region poorly utilized. The city is straitjacketed by its inward-looking infrastructure.” Read the full op-ed.


A hidden roadblock in public-infrastructure projects
By Alastair Green, Tim Koller and Robert Palter, McKinsey & Company

“The world needs more infrastructure than governments can deliver. Long-term projections call for an estimated $57 trillion globally to build new and refurbish existing infrastructure between 2013 and 2030, an amount that governments at any level are unlikely to fund. Yet private investors and companies too frequently fail to fill the gap—even when their coffers are full. As a result, we’ve seen specific projects not getting done—including efforts to privatize an interstate highway in the United States, build an airport in Southern Europe, develop a hospital in Scandinavia, and fund airport services in South America.” Read the full article.


Achieving America’s Full Potential: More Work, Greater Investment, Unlimited Opportunity
By Business Roundtable

“America relies on a platform of digital and physical infrastructure that facilitates the movement of people, information, physical goods and financial assets that drives economic activity. Business Roundtable supports prudent investments in public infrastructure, policies that encourage increased private investment and a smarter, more agile approach to cybersecurity that protects the freedom to innovate and more effectively counters rapidly evolving threats.” Read the full report.


Port Surface Transportation Infrastructure Survey: The State of Freight
By the American Association of Port Authorities

“Seaports are the backbone of a thriving 21st century global economy. Yet, a nation’s freight transportation system is only as good as its underlying infrastructure. In the American Association of Port Authorities’ (AAPA) 2015 Surface Transportation Infrastructure Survey – The State of Freight, results indicate that the nation’s unsurpassed goods movement network needs immediate and significant investment in the arteries that carry freight to and from its seaports. Without that investment, the American economy, the jobs it produces and the international competitiveness it offers will erode and suffer, creating predictable and oftentimes severe hardships to the individuals who live and businesses that operate within its borders.” Read the full report.

KEYWORDS: INFRASTRUCTURE, ORRIN HATCH, RAY LAHOOD, RON WYDEN, WHAT WE'RE READING