Transportation Solutions

By Jay Balasbas, Deputy Communications Director

Transportation Solutions
How government can save taxpayer dollars while reducing traffic congestion

Years of neglect in building infrastructure to keep up with Washington state's population growth has produced the second worst traffic congestion in the country. For the last ten years, we have spent over $12.7 billion on transportation. Unfortunately, this has translated into only 70 new lane miles on our state highways. It has also paid for a bloated bureaucracy that syphons money away from meaningful congestion relief projects. We have a clear choice: do nothing and see traffic get worse or find the methods and money to improve our transportation infrastructure and relieve congestion.

Governor Gary Locke promised in his 2001 State-of-the-State address to "make our Department of Transportation as lean and as efficient as it can possibly be." But none of his promised reforms have materialized. Doug Beighle, chair of the Blue Ribbon Commission on Transportation, stated when they first began their work: "the commission's first task is to explore ideas for increasing efficiency and stretching dollars as far as possible. We're looking at ways for government to streamline permitting processes, make smarter decisions, reduce maintenance costs, broaden contracting choices, and create an all-around simpler system." Somehow, many of those recommendations never made it into the commission's final report.

Many of our elected leaders see only the trees and not the forest. Their solution to fix our transportation mess is to raise taxes. But simply throwing more money at the problem without ensuring every tax dollar is spent in the most efficient way possible will not work. Streamlining the bureaucracy alone will not completely solve our problem. But it will go a long way toward saving and redirecting money to the field so the infrastructure we need can be built.

Skip Rowley, member of the Blue Ribbon Commission on Transportation said, "Before I become the most hated person in Washington and Tim Eyman's poster child, let me say that we can't do any of these [tax increases] until we do things in a more efficient way." Agreed. Our elected leaders need to take a hard look at how current revenues are being spent. The following cost-saving measures will ensure that money is being spent where it is needed most - on road construction.

Economizing the transportation bureaucracy

In this state, 468 entities have their fingers in transportation decision-making and funding. Most people understand that this can't be efficient.

Sometimes a new transportation agency is created for a purpose which is already being performed (or should be performed) by an existing agency. Other times, transportation agencies perform a function because it sounds good, but closer review shows the function falls outside the reason for which the agency was created.

Lawmakers and agency officials should analyze every function performed by each transportation agency to see whether it is essential to the agency's mission. If the service falls outside the mission and function the agency was created to perform, it is best left entirely to the private sector. If lawmakers find that the service is legitimately within the scope of the agency's mission, they should analyze whether the service is already being provided or could be better provided by another existing agency.

Reviewing agency functions will also permit a critical examination of the size of the transportation workforce. In 1996, Michigan reported a 21% reduction (4,206 down to 3,300) in Full-Time Equivalent (FTE) employees after a thorough departmental review. A similar review of the Washington Department of Transportation (WSDOT) could yield a decrease of 1,657 FTEs (7,706 down to 6,049). There is no reason Washington, with a population of 5.8 million people, should have twice as many FTEs in its transportation department as Michigan with a population of 9.9 million people. (Note: Michigan also operates a ferry system.)

Improving project efficiency

Streamline Permitting

Any transportation project must jump through a number of environmental and regulatory hoops before receiving a permit to begin construction. The permit process results in wasted time and as the old maxim goes "time is money."

The Blue Ribbon Commission on Transportation recommended the establishment of a "one-stop" permitting process to streamline the system and minimize project delays. This is a great recommendation on the surface, but it does not address one of the major culprits of permitting delays: the federal government. The federal government requires a "Section 404" permit when projects will be constructed over wetlands or other sensitive environmental areas. These special permits can take years to acquire, thus delaying project construction and increasing costs.

Besides streamlining the state permitting process, WSDOT should petition the federal government for a waiver to allow the state to issue Section 404 permits. The review time would be significantly reduced because permit applications would not have to be sent to the federal government, thereby eliminating another layer of government. The faster a permit is issued or rejected for a transportation project, the sooner the state can focus its resources.

Design-Build

Another way to save money and build projects faster is by using the "design-build" process. WSDOT currently uses the traditional model of "design-bid-build" when constructing highway projects: a project is designed, contractors bid on it, then it is built. It seems like a simple process, but can often take years before a highway project is built and available for use. Different contractors are involved in different phases of the process, which can create administrative overlap, change orders and new specifications, etc. These changes increase the cost and amount of time needed to complete the project.

The "design-build" process (DB) is a new approach to building projects. It seeks to streamline the process of construction by having the same contractor design and build the project. A competitive bidding process is still required, but the winning contractor is responsible for both phases of the project. A study by WSDOT identifies that in a DB project "innovation, time savings, and sometimes lower costs can result from effectively blending the talents of the designer with the capabilities of the builder."

DB has already been employed in Washington state with the building of the Center Drive Interchange in Dupont (about 10 miles north of Olympia). In the summer of 1995, the Intel Corporation announced its decision to locate a new research, development, and manufacturing design facility in Northwest Landing (a large Weyerhauser-owned community near Dupont). Intel would locate there if WSDOT could build the Center Drive interchange in a short time frame. A typical WSDOT project is built in 50 months, but Intel wanted it done in 18 months. Efficient transportation was the deal maker and if WSDOT could not build the project in Intel's time frame, Northwest Landing would lose the new Intel facility. After negotiations, WSDOT promised to deliver and Intel accepted that the interchange would be completed in 28 months.

Ultimately, the interchange was finished in 26 months - two years faster than a typical WSDOT project - and cost $3 million less than anticipated. There were several favorable circumstances that helped speed the process:

• Weyerhauser had already agreed to fund up to $19.3 million for the construction of the new interchange.
• There was close cooperation between the public and private sector.
• Because the project was privately funded, WSDOT could take prudent risks.
• Environmental, bridge design, and geometric design processes were done simultaneously rather than sequentially.

Does the Dupont interchange project mean that all state transportation projects can be completed in half the time? Probably not, but some very important lessons should be learned from the Dupont experience.

According to WSDOT's final report on the Dupont interchange, the experiences from the project resulted in recommendations that WSDOT:

• Improve its environmental and right-of-way review process and eliminate excess number of reviews.
• Not assume that an Environmental Impact Statement (EIS) will be needed. Rather, determine the appropriate level of environmental documentation based on environmental impacts.
• Allow and review right-of-way appraisals before design and environmental approval.
• Reduce the amount of time required to mobilize consultants in specialty areas.

In addition to implementing those recommendations, WSDOT should involve the private sector more in construction and financing of highway projects. Private financing allows WSDOT to speed up the construction process.

The Dupont project reveals that given favorable circumstances and the ability to take measured risks, WSDOT can deliver a product far more efficiently than we are accustomed to seeing. EFF hopes that many lessons from the successful Dupont interchange will be identified and applied to future projects. One lesson is clear: private-sector funding provides opportunities for prudent risk-taking and as a result, products may be delivered more efficiently. Competitive Bidding

Contrary to assertions by public employee union bosses, competition does improve the efficiency and delivery of government services to the public.

Competitive bidding is a new tool increasingly used by state and local governments around the country. Many government services are contracted out to the private sector. However, when a government service is put out to bid, competitive bidding allows public employees to compete with the private sector for delivering the government service.

Using competitive bidding for more than 60 city services allowed former Indianapolis mayor Stephen Goldsmith to save $450 million for city residents. More private sector jobs were created as well.

Many current WSDOT services should be subject to competitive bidding. For instance, rest area operation and maintenance could be put out for bid. If a private company wins the contract, businesses will locate in the rest areas and, in exchange, they could maintain the entire rest area and pay a user fee to the state. Other areas where competitive bidding can be used include the development and upgrades of airports, public transit, motor vehicle registration, and fleet operations and maintenance.

Competitive bidding is a proactive change in the approach to buying government services. It is not a quick-fix, one-time money saver. Lawmakers should not expect millions of dollars in savings overnight, but continual and increasing savings over the long run. The Reason Foundation, a national policy research organization, estimates that governments can save taxpayers between 20 and 40 percent through competitive contracting.

Success through competitive bidding cannot be guaranteed unless there is strong support from elected leaders, explicit expectations and timelines, regular review, clear and cooperative lines of authority, and appropriate timing. Poorly planned, uncommitted, or manipulated efforts at competitive bidding are destined for failure.

Privatization/Abolishing Government Monopolies

Certain services performed by government are grossly inefficient and waste valuable taxpayer dollars. When no amount of reforms will make a government service more efficient and accountable, it should be provided by the private sector.

Airports

A number of transportation services provided by government could generate enormous amounts of money for needed transportation improvements if they were privatized. For instance, airports could be sold or leased to private operators. The airport privatization trend was started by Great Britain in 1987 when it sold seven airports. Since then, the private operator has invested over $5 billion in the airports and in 1998 paid $340 million in taxes to the British government.

A study by the Heritage Foundation, noted that Sea-Tac International Airport alone would generate nearly $2 billion if it was sold or leased to a private operator. Future revenues from the airport would be realized through property, sales, and business and occupation taxes paid by the private company. Airports are an untapped source of wealth for city and state governments. Why not try this before raising taxes?

The ferry system

The Washington State Ferry (WSF) system could also be privatized. Privatizing the ferry system is always a controversial topic. Prior to the 1950s, ferry service in Puget Sound was provided by a private operator. What happened? In the late 1940s, ferry workers' labor unions got higher wages from the private company. When the company asked the state to allow it to increase fares by 30% to make up the cost, the state refused and ferry service came to a grinding halt. The state then took over and has provided ferry service since 1951.

Opponents of ferry privatization argue that private companies do not find operating ferries a viable business venture. That is true in Washington state because three very restrictive state laws discourage private companies from operating the ferry system:

• Ten mile rule - No provider may operate a ferry service within a ten mile radius of a route currently offered by WSF unless the operator receives a franchise from WSDOT or a waiver from the Utilities and Transportation Commission.
• Assumption of labor agreement obligations - Any party renting, leasing, or chartering a ferry from WSF must operate under WSF labor agreements.
• Contracting out prohibition - The state cannot contract out for labor if the contract would have the effect of terminating classified employees.

These laws effectively prohibit private companies from operating an efficient ferry system because they may not offer service on popular ferry routes and they must abide by costly union agreements WSF has made with employees. Moreover, even if the state wanted to contract out ferry service to the private sector, they could not do it unless current WSF employees were hired by the private operator.

Before privatizing the ferry system, these three laws must be abolished. They serve no purpose other than to protect union bosses and the state monopoly on the system.

For the upcoming 2001-03 biennium, the state will spend more than $500 million on ferry operations, maintenance, and capital construction. Of this amount, some $300 million will be spent on ferry operations. Ferry fares make up the bulk of the funding for ferry operations, while gas taxes and registration fees cover the remaining costs.

The shortfall the state is experiencing in the ferry system lies primarily in the capital component of the system. The capital component deals with the purchase and construction of new ferries and terminals. Maintaining and operating vessel terminals and the Eagle Harbor maintenance facility are also part of the capital component. Much of the funding for ferry capital projects was eliminated with the passage of Initiative 695.

Instead of inefficiently spending a quarter billion dollars a year, the state should consider bringing back the "mosquito fleet." In the early 1900s, small packet ships run by private operators known as the "mosquito fleet" were the sole means of transportation for people and goods in Puget Sound. But the advent of the car and the freeway system rendered these boats obsolete. In 1990, the Washington Public Ports Association published a report showing that establishing a new mosquito fleet throughout Puget Sound is viable and could be started very quickly. Many of the current WSF routes would be served by the new mosquito fleet. And while one-way fares for riding the mosquito fleet would be higher than current WSF fares, this should come as no surprise to ferry riders. Ferries are a premium service and the cost should be borne by those who use it.

Establishing the mosquito fleet, thereby removing state control of the ferry system, will allow the more than $500 million per biennium spent on the ferry system to be used for highway congestion relief projects.

Privatization and competitive bidding in transportation represent opportunities to save the state millions of dollars and direct that savings into projects that actually help solve our traffic mess.

Eliminating the light-rail boondoggle

In 1996, voters in King, Pierce, and Snohomish counties approved the creation of Sound Transit - a new regional entity charged with building a light-rail line from Sea-Tac Airport to Northgate. New bus and other transit services would also be established to serve the rail line and other communities in the tri-county area. Voters in Regional Transit Authority Districts (RTA) would pay for the project with a 0.4% increase in their sales tax and a 0.3% increase in their motor vehicle excise tax. Most voters in King, Pierce, and Snohomish counties belong to an RTA district.

Five years later, Sound Transit is in trouble. The project is $1 billion over the original voter-approved budget, the federal government has decided to withhold federal dollars, and the number of critics continues to grow with each passing day. Still, Sound Transit board members are floating the idea of asking all voters in King, Pierce, and Snohomish county to finance the light-rail project even though a vast majority of those people would not benefit from it.

Instead of wasting precious resources on a project that doesn't seem to be working, EFF suggests that our elected leaders seriously consider an elevated light-rail system. A proposal for this type of system was made to the legislative transportation committees in the 1970s but never pursued because it was thought to be ahead of its time.

Two transportation concepts would be merged in an elevated light-rail system: (1) the overhead monorail passenger vehicle system linking downtown Seattle with the Seattle World Fair in 1962 and (2) the underground, electric powered rubber-tired automated "bus" system linking the main terminal of Sea-Tac with the north and south satellite passenger terminals, which was inaugurated in 1971.

The following is an excerpt from an outline of the elevated light-rail proposal:

"A merger of these two systems applied to current plans for mass transit in the Tacoma-Seattle-Everett corridor offers the prospect of building an elevated light rail system at a fraction of the cost and time currently projected for a conventional light rail system. Such a system would be quieter and inherently safer than rail. It eliminates surface rail crossings and can tolerate much steeper grades than conventional rail so it could be built above ground through the downtown Seattle corridor, eliminating the need for tunneling.

The key hurdles to this proposal are primarily political involving loss of face and turf and requiring very close cooperation between federal, state, and local governments.

What this proposal envisions is a "people mover" system elevated above existing freeways. Columns would be embedded in the inside edge of the right-of-way a safe distance from the curb lane and where necessary, on acquired property adjacent to the right-of-way. These would support concrete "bus-ways" similar to those at Sea-Tac built above the freeway traffic and overpasses. The "buses" running on these bus-ways would be electrically powered, electronically controlled vehicles and would be rail-guided, rubber-tired, and locked to the bus-way for safety and silent running. Loss of these vehicles to accidents would be nil.

They would travel between passenger stations located at appropriate intervals, many at existing or new park-and-ride areas and malls adjacent to the freeway. Neighborhoods and sites of heavy employment would be linked to these stations by conventional buses or mini-buses circulating throughout the adjacent neighborhoods and employment centers on frequent scheduling.

Eventually under this proposal, bus-ways and stations would be added to virtually all freeways as needed. Obviously, this is an overly simplified explanation of the system. For example, planning, engineering, and construction for an above ground route through the downtown Seattle area should be much less difficult than that for tunneling. Access to an above ground system would be greatly simplified. The use of the "new" technology has already been tested and would solve many of the problems posed by the construction of conventional light rail systems like those installed in Portland, Oregon and the San Francisco bay area.

The political problems that currently restrict the consideration of this kind of system include right-of-way ownership, operational authority, design and engineering oversight and limited direct community service.

The acquisition of right-of-way, which can be the major cost of a conventional light rail system, would be largely eliminated by this proposal. The catch is a small portion of existing freeway right-of-way now "owned" by WSDOT would have to be shared with Sound Transit.

Design, engineering, and construction oversight responsibility for elevated light rail should be negotiated and transferred to WSDOT (together with appropriate Sound Transit planners and engineers).

Conventional buses, mini-busses and the elevated light rail system should be owned and operated by the existing mass transit agencies following system construction. This would facilitate schedule coordination. Each train of vehicles should also have a driver and an assistant who would be responsible for passenger security and for handling emergencies even though the elevated light rail system should be fully automated using current and proven technology. Conventional busses, mini-busses, and express busses would continue current service except that as each segment of elevated light rail is completed, busses would be rerouted for rapid pick-up and transfer of passengers in communities adjacent to its elevated light rail passenger stations. The bus-way would decline to ground level at these stations.

Because projected construction costs and delays are escalating, serious consideration to this proposed system seems warranted. Also, conventional light rail is much too expensive to provide access to every community, as witnessed by a recent expensive compromise to extend light rail to a politically sensitive community in Seattle. It must be married to a rapid bus service system.

Existing freeways were routed so that the majority of residents would have convenient access to them. The reason that conventional light rail does not opt for freeway corridors is that surface light rail technology will not fit it. Elevated light rail will, if a sharing of freeway right-of-way is accomplished politically."

The above proposal truly represents thinking "outside the box." The elevated light rail plan should be considered by our elected leaders and Sound Transit as an alternative to the current plan.

In the meantime, voters should be given the opportunity to decide if the current Sound Transit plan should continue. If Sound Transit is dissolved, all tax money from the project should be directed into congestion relief projects in that area.

The Bottom Line

The proposals in this document are not an exhaustive list of how government can save money in transportation. Opportunities to get the most out of current transportation dollars are all around us. Our leaders must be willing to think outside the box they've been given.

The state must show that EVERY transportation dollar is being spent in the best way possible before asking us for more of our hard-earned money.

Endnotes

1. Design Build Process for Highway Projects. WSDOT: 1999. p 9
2. I-5 South Dupont Interchange Design Process Report. May 1997. pp 23-25
3. William D. Eggers and John O'Leary. Revolution at the Roots. New York: Free Press, 1995. p 99
4. Ronald D. Utt. FAA Reauthorization: Time to Chart A Course For Privatizing Airports. Heritage Foundation: 1999. p 10
5. Elevated light rail proposal by Robert L. Beardsley. Mr. Beardsley is a former Commissioner of Highways for the State of Alaska 1969-1971. He also was president of Reichhold Energy Corp., which made the initial discovery of natural gas in Oregon, near the small community of Mist. He is now retired and active with the Tacoma Area PC User Group.

Jay Balasbas, Deputy Communications Director, Evergreen Freedom Foundation

Evergreen Freedom Foundation P.O. Box 552, Olympia, WA 98507 Phone: (360) 956-3482, Fax: (360) 352-1874 Email: effwa@effwa.org