U.S. Secretary of Transportation Elaine Chao is leading the fight to make public-private partnerships for infrastructure projects a reality at a time when they are sorely needed. Cash-strapped cities and states just don’t have the money to keep up with the demands of an increasingly mobile society.
With the president’s full backing, Chao and others administration insiders are looking for ways to streamline the modernization of the nation’s aging infrastructure. The longer America waits, the harder it will be to remain competitive in the global market.
Chao is moving quickly. Recently she told the Association of State Highway and Transportation Officials she was personally committed “to identifying ways to eliminate unnecessary paperwork and bureaucracy that will save states time, money and reduce burdensome compliance costs.”
Progress has already been made. Regulatory and policy changes will allow major projects to start faster, finish quicker, and likely come in under budget. The states should undertake similar reforms so the public and private sector function harmoniously for the betterment of the American taxpayer. Unfortunately, not every state is moving in that direction.
In Alabama, where lawmakers borrowed $437 million to cover a recurring budget shortfall, things are still headed over the financial cliff. They cannot resist the urge to spend on pet projects rather than focus on reforms that would drive real economic growth in all corners of the state, not just the ones with the most political clout. Recent tax hikes and spending cuts have hit the state’s poorest residents the hardest. Medicaid and education funding have been gutted. Taxes on medical services and consumers goods disproportionately used by the poor continue to rise.
It’s a hard place to plan for infrastructure projects, needed though they may be. Some lawmakers continue to push, at a cost of $30 million, construction of a new road and bridge to service what is largely a vacation home community. Rather than spend scarce tax dollars this way they should follow their successful existing model of partnering with a private sector company to construct a new bridge to relieve traffic congestion.
The Alabama Beach Express, one of the two bridges that already cross the Intracoastal Waterway, has been such a success the owners have been able to lower the toll, voluntarily, and are committed to investing the funds necessary to widen the span to ease congestion. It’s a successful public-private partnership and, having done it once, with a willing partner in Secretary Chao in Washington, they should do it again. Instead they want to revert to the old way of doing business using tax dollars alone. It just doesn’t make sense.
Poor states like Alabama can no longer afford to indulge in lavish infrastructure spending. Funding options like public-private partnerships are a viable alternative. Alabama is the nation’s seventh-poorest state with over one-third of residents living in poverty in a number of counties. Government spending should be focused on essential services. If the legislature and the Department of Transportation use tax dollars to fund a new bridge then entire state pays for a project only few will use – regardless of ability or willingness to pay.
Since not building it at all really isn’t practical, there are really just two options for moving forward. The state can borrow and spend taxpayer dollars for the construction and ongoing maintenance of a “free” bridge or it can allow a private sector partner to invest in the state and take the taxpayers off the hook. Both options will likely alleviate congestion, but only one will solve the problem while saving.
Alabama’s leaders already have examples of both. The public I-59 bridge is there for folks who don’t want to pay a toll. It’s badly overcrowded. The Beach Express is there for those who are willing to pay to avoid the traffic. The people have a choice, a development we should all applaud, rather than trying to follow the old model just because that’s the way things have always been done.
The state has a great story to tell, one that should draw the attention of the president and Secretary Chao. It’s unfortunate some elected officials, rather than sing the praises of the public-private approach to major construction projects seem intent on ruining the model. Why they would want to raise taxes, borrow more money and spend tens of millions on a project the private sector would undertake with them is simply a mystery.
President Donald Trump and the U.S. Department of Transportation have started to bring the road and bridge building process, particularly where the issues of red tape and financing are concerned, into the 21st century. The environment is ripe for change. Rather than remain tied to the old order states like Alabama that needs new roads and bridges but can ill-afford them should likewise seek to be pioneers in the kind of innovative thinking that will put people back to work rebuilding America.