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i>By Paul Dempsey and Theodore Prince

Today, the U.S. transportation network no longer enjoys the luxury of overcapacity that regulation afforded. It is plagued by congestion, which slows the delivery of goods. For passengers, the waste is just as extensive. Congestion costs Americans annually between $70 billion and $78 billion in wasted fuel and 3.5 billion hours in lost productivity.

If the United States is to continue to be a leader in the 21st-century global economy, it needs a robust, integrated transportation system to move passengers and freight throughout the nation quickly and efficiently. Such a system also needs to be resilient in the face of possible disruptions.

The policy objectives of the 1991 Intermodal Surface Transportation Efficiency Act (ISTEA) and its successor, the 1998 Transportation Equity Act of the 21st Century (TEA-21), were to replace the fragmented modal systems into a single, integrated, seamless, intermodal transportation system. There is extensive legislative intent emphasizing intermodalism as an important means of reducing congestion and pollution, of enhancing efficiency and productivity and of reducing waste in public transportation expenditures. Unfortunately, these policies have been largely ignored.

This failure is largely because of institutional inertia. Although most state highway departments have changed their names to state “transportation” departments, they are still dominated by bridge and asphalt engineers. The U.S. Department of Transportation itself is organized along modal lines — in administrations for highway, railroad, transit and aviation. So too are congressional committees. Although federal funds are theoretically “flexible,” most funding is both earmarked for modal spending and oversubscribed.

It is unlikely that we can continue to add infrastructure at an unfettered pace. Although congestion creates demands for investment, traditional ways of investing public dollars provide only marginal improvements in capacity.

Unlimited funds would not solve the problem. We are running out of suitable places to build. Many existing facilities are constrained from further expansion by adjacent development and land use. Environmental concerns and reviews are much more extensive, and the growth of “NIMBYism” — not in my back yard — has become a frequent obstacle to transportation construction.

What should be done to remedy these problems?

Intermodalism — starting with pending reauthorization — must be recognized as an essential solution to the nation’s transportation needs if we are to remedy congestion, pollution and security vulnerability problems. This requires going beyond the mere recitation of policies to mandate specific action:

• Examine spending priorities so federal funding encourages integration of modes into a single, seamless transportation system. Improve the robustness and reliability of the transportation network — adding redundancy if necessary. Recognize the role of international trade. Address the common issues of freight and passenger transportation.

• Establish new planning mandates so projects evaluate their effect on the network while supporting the need to facilitate modal connectivity and seamlessness in transfers between (and among) modes for both freight and passenger.

• Seek true network solutions, because transportation is an asset-based, network operating industry, and proposed projects must be evaluated in this context. For example, does it eliminate a constraint — or just relocate it? Although projects have been assessed on physical life, the risk of economic obsolescence cannot be ignored. Requirements change rapidly, and past success may not be a guarantee of future benefits.

• Understand what works best by identifying and applying best practices to reduce business expenses and improve organizational efficiency.

Reform the federal role because a new perspective is needed — that of the actual users. The DOT needs to think of transportation from the perspective of passengers and freight — rather than from the perspective of the airport, the highway or even the common carrier. Only then will priorities be established (and funds allocated) to ensure the efficient movement of passengers and freight.

• Restructure the DOT in recognition of transportation’s pervasive nature and the need to interact with numerous other cabinet departments and executive agencies. This complexity extends into the organization of congressional committee oversight, jurisdiction, and funding.

• Invest in an intermodal transportation system for the 21st century by moving beyond the status quo and seeking financial innovation. A federally chartered transportation finance corporation could issue tax credit bonds; state infrastructure banks could be expanded; private activity issues could be provided greater flexibility for tax-exempt debt; tax advantages could induce more private-sector investment; and the use of passenger facility charges could be expanded to airport access and serve as a model for funding U.S. seaports.

Opinion was excerpted from Investing in America’s Future: The Need for an Enlightened Transportation Policy, published by the Intermodal Transportation Institute of the University of Denver. Paul Dempsey is director of the Institute of Air & Space Law, McGill University and ITI faculty team member. Theodore Prince is senior vice president of marketing and sales for Optimization Alternatives Limited and a member of the ITI board of directors.

This article appeared in the May 30 print edition of Transport Topics. Subscribe today.