Transportation spending surges to historic levels. Will US get historic results?

The United States has never spent so much money on transportation, dams, sewer and water systems, electric transmission lines, and other networks. As a share of gross domestic product, today’s effort is bigger than infrastructure spending under the New Deal and the most spent in the last half-century. Looking strictly at the surge in transportation funding, experts on both right and left are cheering what the Biden administration has billed as a once-in-a-generation effort to rebuild and improve.

Whether the nation will get once-in-a-generation results, however, remains unclear. Inflation has eroded some of the federal funding boost. There are concerns that state and local governments are spending on mundane fixes instead of innovative projects with more bang for the buck.

Why We Wrote This

The network of roads in the U.S. is expansive – but it was built decades ago. Same for other areas of America’s infrastructure that citizens rely on. The U.S. is making a huge investment in improvements. What can citizens expect?

The challenge is that while the U.S. roads network is vast, it is also old. The last big push in road-building happened more than 50 years ago. And while experts are optimistic, they caution that maintaining aging infrastructure involves innovation and an ongoing commitment. 

The new infrastructure law expands the use of private activity bonds, which allow states and localities to raise money at tax-advantaged rates and fund companies building infrastructure projects. The rebuilding of Baltimore’s Francis Scott Key Bridge, which collapsed after being hit by a container ship, offers another opportunity for innovation. A second area ripe for improvement is urban transit. Subway, bus, and commuter rail systems are struggling to regain ridership in a post-pandemic era in which fewer people commute to work. 

Even as officials move swiftly to clear away Baltimore’s Francis Scott Key Bridge, which collapsed after being hit by a container ship, the United States is in the midst of an unprecedented push to upgrade its transportation networks.

The nation has never spent so much money on transportation, dams, sewer and water systems, electric transmission lines, and other networks. As a share of gross domestic product, today’s effort is bigger than infrastructure spending under the New Deal and the most spent in the last half-century.

Looking strictly at the surge in transportation funding, experts on both right and left are cheering what the Biden administration has billed as a once-in-a-generation investment.

Why We Wrote This

The network of roads in the U.S. is expansive – but it was built decades ago. Same for other areas of America’s infrastructure that citizens rely on. The U.S. is making a huge investment in improvements. What can citizens expect?

Whether the nation will get once-in-a-generation results, however, remains unclear. Inflation has eroded some of the federal funding boost. There are concerns that state and local governments are spending on mundane fixes instead of innovative projects with more bang for the buck.

“How far do the [federal] checks go? It’s an open question,” says Adie Tomer, an infrastructure policy expert at the Brookings Institution. Voters won’t know until the spending bills run their course.

Still, the funding surge is so big that it will make its mark, infrastructure experts agree.

“By 2025, we’ll see some improvements,” says R. Richard Geddes, a professor and founding director of Cornell University’s infrastructure policy program. “There will have been an effect on the quality of U.S. infrastructure because of the IIJA,” the $1.2 trillion Infrastructure Investment and Jobs Act passed with a bipartisan majority in the early days of the Biden administration.

Making wise spending choices

But has the money been well spent so far? Experts question some choices that states and localities are making under the infrastructure act, especially when looking strictly at transportation improvements.

For example, when Hani Mahmassani, director of the Northwestern University Transportation Center, searched nearby IIJA projects, he found a $19 million grant to Chicago’s O’Hare airport to upgrade a terminal with, among other things, a family restroom accessible to people with disabilities.

“Is this what we do for a once-in-a-generation type of opportunity?” he asks. Such projects are important but should be funded out of routine maintenance budgets, he adds. “Fixing toilets should not require an act of Congress.”

Elsewhere, there are signs of innovation and opportunities for more transformative transportation projects.  

Car commuters line up to enter I-110 Harbor Freeway in the rain in downtown Los Angeles, March 6, 2024. The biggest piece of the U.S. infrastructure push supports state-funded improvements to streets and highways.

The biggest piece – and the fastest one out of the gate – is state-funded improvements to streets and highways. State departments of transportation regularly apply for federal highway funds, so when the new money was made available in 2021, they were best placed to move quickly.

How federal dollars support local budgets

The impact of the federal boost varies by geography. In large states, which fund a lot of their own road maintenance, the roughly 20% boost from Washington was nearly eaten away by high inflation in construction materials, says Jim Tymon, executive director of the American Association of State Highway and Transportation Officials. 

For smaller states, federal funding can amount to 80% of highway funding, making the recent surge far more important. Tiny Rhode Island, for example, boasts five notable road construction projects currently underway, paid for largely by the new infrastructure dollars.

Other projects have taken off much more slowly. Local governments, far less familiar with the demands of federal appropriations, have been slower than states to ask for money. And a $5 billion program to fund electric vehicle charging stations across the U.S. has so far only produced only seven of them, scattered across four states, according to The Washington Post.

The broader challenge is that while the U.S. roads network is vast, it is also old.

The last big push in road-building – the peak construction of the interstate highways – happened more than 50 years ago. Almost half of the nation’s roads are now in poor or mediocre condition, according to the American Society of Civil Engineers, in its latest assessment in 2021. Those deficiencies cost the average American motorist more than $1,000 per year in wasted time and fuel, the ASCE estimates. It gave the nation’s roads a grade of D.

Experts are optimistic the new spending push – which includes federal infrastructure spending beyond the law’s new funds – will improve that grade. But they caution that maintaining an aging infrastructure should be an ongoing commitment. “It’s like climbing up a hill of sand,” says Mr. Tymon. “We hope it’s not a once-in-a-generation improvement.” 

Some transportation networks are in better shape than roads. The nation’s ports earned a B-minus from the ASCE in 2021 and railroads got a B. In both cases, private companies often pitch in to pay for maintenance. Some experts are pushing for more private investment in other transportation networks. 

In search of investment and innovation

“We need to promote public-private cooperation,” says Mr. Geddes at Cornell. “There’s trillions of dollars of private capital on the sidelines waiting to invest.”

The new infrastructure law includes funding innovations, such as expanding the use of private activity bonds, which allow states and localities to raise money to fund private infrastructure projects. The law also requires local governments to look at all models of infrastructure projects, including public private partnerships. “You can’t just default to what you’ve always done,” says Joshua Schank, managing principal at InfraStrategies, a transportation consulting firm based in Southern California.

One area ripe for innovation is urban transit, he adds. Subway, bus, and commuter rail systems are struggling to regain ridership in a post-pandemic era in which fewer people commute to work. Instead of bunching train and bus schedules around rush hour, they’re providing more service during other parts of the day. Another experiment: microtransit (like an Uber but carries several passengers, making multiple stops and costing less).

The rebuilding of Baltimore’s Key Bridge offers another opportunity for innovation. Stricter rules will automatically require better designed and protected piers than the one that collapsed when the cargo ship rammed it on Tuesday. The rebuilding can take advantage of advanced concrete and design innovations to make it more resilient.

When New York state replaced the Tappan Zee Bridge with the Governor Mario M. Cuomo Bridge in 2020 over the Hudson River, it included dedicated bus lanes, a shared-use pedestrian/bike path, and more than 300 sensors measuring everything from temperature to fatigue on the cables and concrete corrosion. 

The Key Bridge could become even more cutting-edge.

“You can have lanes switch to ‘bus only’ or HOV [high-occupancy vehicles] very quickly,” says Mr. Schank. “You can have, eventually, better communication with cars themselves that can provide safety benefits. … Whenever you have the opportunity to rebuild infrastructure that’s been around for a while, there’s an opportunity to bring innovation.”

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