Value: The New Watchword in Washington be reserved for only the largest and most complicated and benefits. Our first order of business, then, should projects (which will benefit, perhaps even more, from be a reform of the planning and capital programming private sector operational, budget, and technical skills) processes and institutions that make the decisions at the and where revenue streams (such as highway or bridge state and regional levels. It is rare that the existing tolls or dedicated sales taxes) can be identified to service agencies develop comprehensive strategic investment and repay private debt and to provide competitive programs or undertake benefit-cost analyses of returns to invested equity. Such projects are likely, at competing projects or prioritize investments based on best, to comprise 10 to 20 percent of the funding needed. hard financial and economic analyses. Moreover, it should be understood that in the case of It is not for the federal government to make decisions projects largely dependent on private investment and about which are the most important infrastructure financing, the public funding burden has merely been projects within states and regions. Priority setting shifted from federal taxpayers, not to the private sector, should be a state and local prerogative. However, if but to state and local taxpayers in the form of new user federal funds or tax credits are to be utilized in such fees and taxes. projects – as they almost In other words, in any certainly will have to be large transportation and if we are to carry out an infrastructure program infrastructure investment focused on bringing program of the size existing facilities to a and reach that has been state of good repair, the discussed – then there is heaviest burdens will a clear national interest have to be borne by in making sure that a public funds. And almost rational and analyticallycertainly, federal grants to driven investment states and local authorities decision-making process will have to bear a exists. significant portion of the As we enter a period funding requirements. of significant public Despite the spending on the nation’s We must accept that we will not widespread call for a infrastructure, our massive infrastructure guiding principle should be able to do everything, so we investment program, it be that our investments must be able to identify and seems unlikely that a must be “wise” – that target public investments on full $1 trillion federal is, directed to those program will be enacted, projects and programs those projects that will bring the because of disagreement that will bring not just greatest economic returns about the funding short-term construction sources and Congress’ and construction-related and benefits. determination that, if jobs, but long-term much of this investment is benefits in the form of going to come from new spending, sources and budget a more productive economy, greater access to jobs “pay-fors” must be identified. This will be a daunting and markets, and an improved quality of life for the challenge. American people. RF But America can, and should, make significant inroads in the huge infrastructure funding gap that Emil H. Frankel serves a senior fellow at the Eno ASCE has identified. However, we must accept that Center for Transportation. He previously served as we will not be able to do everything, so we must be Assistant Secretary for Transportation Policy at the U.S. able to identify and target public investments on those Department of Transportation, and as Commissioner of projects that will bring the greatest economic returns Transportation for the State of Connecticut.
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RIPON FORUM February 2017
“Ideas that matter, since 1965.“