How the Stimulus Fund Has Affected Transportation
Posted on Thu, Sep 16, 2010 @ 01:09 PM
The stimulus money at work in the U.S. is pretty evident. Everywhere you go there seems to be road construction. This is due to the 48 billion dollars that went towards improving transportation all over the country. The money is intended to create jobs in the construction industry, which has an unemployment rate of 17.3%. Even though the stimulus package is slowing traffic to a grinding halt, the money that was put into improving the transportation system is improving the economy. On top of the 48 billion dollars that is already being spent, President Obama wants to spend 50 billion more on roads, runways, and railways. It is America’s most ambitious transportation act since the interstate highways project.
The Department of Transportation has committed 38.6 billion dollars to more than 14,600 projects, and the majority of them are ongoing. About 70% of the money is going to highways; the rest is mostly on improved subways, buses, light rail, and other mass transit projects. More than a billion dollars has been marked for Amtrak, and a similar amount has gone to airports. Despite the spending, the construction industry is still hurting, and unemployment has not dropped enough for Obama to claim success.
President Obama’s plan is to "rebuild 150,000 miles of road" and "restore 150 miles of runways". His system is “fix-it-first”, meaning that no new roads or runways are going to be made. This was made clear during the first stimulus package. The Highway Department has already spent all of the 26.6 billion dollars it was given and only 9% of it went toward new roads. This is because according to Smart Growth America, repair work generates 16% more jobs than new construction. Remember that the focus of the stimulus package is not just to improve and create new roads, but to create new jobs. The one clear exception to fix-it-first policy is high-speed rail. Obama said he wants to spend 8 billion to "lay and maintain 4,000 miles of track".
Most importantly, Obama plans to finance projects through an infrastructure bank that will create merit based funding for public works such as the TIGER Fund did. Established following the American Recoveries and Reinvestment Act of 2009, the TIGER Fund was a grant program for innovative projects that awards $1.5 billion to companies that come up with ideas that are both economically and environmentally friendly. Winners of the grant have included several freight-rail projects that will take thousands of trucks off the road, a green-themed revitalization of a Kansas City neighborhood, an intermodal transportation center at the intersection of three interstates, a major rail corridor and a popular 26-mile bicycle and pedestrian pathway.
The last transportation bill that was passed was supposed to expire last year but it has been extended through December. The bill has over 6,000 earmarks and no statement of purpose. Not the kind of bill that typically gets extended past its expiration date. "It's forcing us to think about transportation with a capital T, instead of just checking boxes," says John Porcari, DOT's Deputy Secretary.
The difficult part of any transportation act lies in how the government is going to pay for it. The funding is almost maxed out and there is hardly anything left to add to the stimulus. The problem is that people are driving less, which is great for the environment, but doesn’t do anything for transportation funding. Taxes from gas go towards the highway trust fund and with less money flowing, the fund is drying up. Obama’s new plan would be both revolutionary and good for the country, however without funding it’s not going to happen.