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Transportation Policy

Rethinking investment policies and revenue sources

Photo by CTA

The issue: Uncoordinated spending, inadequate funding

The Highway Trust Fund has already required $50 billion in emergency infusions. Without another, it will be bankrupt this September.

Federal and state funding for transportation infrastructure is declining, but the demand for our region's transportation network has never been greater. As MPC explores new revenue options, we are simultaneously advocating for investment policies that prioritize projects that reduce hours spent in traffic, curb emissions, connect affordable homes and jobs, spur economic development and improve safety.

The state of transportation funding

The federal and Illinois motor fuel taxes that fund transportation have been fixed at 18.4 and 19 cents per gallon, respectively, since the early 1990s. With the effects of inflation and the increasing fuel efficiency of vehicles, gas taxes are no longer sufficient to maintain our current transportation assets, much less fund expansion. The federal Highway Trust Fund, which also funds mass transit, has required $50 billion in general fund bailouts over the past five years. Without another emergency infusion, it will be bankrupt in September 2014.

Highway Trust Fund headed for bankruptcy

Includes both highway and transit accounts. Numbers for 2014 assume a $12 billion transfer from the general fund; 2015 and beyond are projections. Sources: Federal Highway Administration, Congressional Budget Office

Funding from the Illinois fuel tax will fall by more than 36 percent through 2040. When combined with declining federal contributions, the Chicago region will be $5 billion short just to do the bare minimum and maintain our transportation network to a safe standard. To keep the system in a state of good repair and accomplish the modest enhancements identified in our regional GO TO 2040 plan, the shortfall reaches $43.5 billion.

The solution: Identify steady funding, prioritize investments on merit

We must stabilize transportation funding and prioritize investments based on performance.

Both the Illinois and federal governments need new, reliable revenue sources to fund the transportation improvements that commuters and employers desperately need. Any funding solution must be linked with clear selection criteria and performance measures that target investments to advance coordinated regional goals and a strong national vision. Whether it’s a new Bus Rapid Transit line, managed expressway lane or bike route, a transportation asset that performs well at multiple levels—reducing congestion, curbing air pollution, connecting people to vital destinations, sparking economic development—is the sort of responsible, performance-based investment that should be prioritized.

With both federal (MAP-21) and state (Illinois Jobs Now) transportation spending legislation expiring in 2014, MPC is advocating for a number of policy changes to reform the way we bring in and spend transportation dollars.

The benefits: Effective transportation investments that fuel the economy

Every dollar invested in public transit generates four dollars of economic returns.

An effective transportation asset does more than simply move people or goods: It accelerates economic growth. Research shows that every $1 invested in public transit generates about $4 of economic returns. Conversely, an underperforming transportation system hobbles the economy: Traffic congestion costs our region at least $7.3 billion dollars annually.

To ensure we receive the maximum return on investments, state and federal transportation funding should prioritize infrastructure that meets performance-based criteria. When decision makers are more accountable and the decision-making process is more transparent, taxpayers know where their dollars are being invested and are more likely to support new revenue sources. A performance-based approach also would give Illinois an advantage over other states in pursuing competitive federal funding.

For more information

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For more than 80 years, the Metropolitan Planning Council (MPC) has made the Chicago region a better place to live and work by partnering with businesses, communities and governments to address the area's toughest planning and development challenges. MPC works to solve today's urgent problems while consistently thinking ahead to prepare the region for the needs of tomorrow. Read more about our work »

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