Despite the common refrains about transportation spending creating jobs, most states don’t actually give serious thought to the economic impact of transportation projects. More often than not, they’re content to sink money into freeways despite a wealth of research that shows that transit, bikeways, and sidewalks deliver a much bigger economic bang for the taxpayer’s buck.
There is evidence, however, that this may be changing.
In a new paper, “Better Use of Public Dollars: Economic Impact Analysis in Transportation Decision Making,” [PDF] author Nicolas Norboge examined how economic analysis can help states make smarter transportation decisions. He describes the uninspiring status quo:
Applying economic impact analysis to transportation projects might seem an obvious part of the decision-making process, but today many transportation investments are made without considering these impacts. The Government Accountability Office (GAO) reported in 2010 that only 11 states cited economic analysis as being very important when deciding which projects to include in their statewide transportation plans.
Norboge, an assistant researcher at the Texas Transportation Institute and a fellow at the Eno Center for Transportation, developed a set of recommendations to guide transportation investment in today’s stringent fiscal atmosphere. An economic impact analysis is one of several emerging tools intended to supplement the traditional environmental impact statement (EIS) requirement, an engineering study mandated under the National Environmental Policy Act, in weighing the costs and benefits of a particular project.
The way things are now, states get piles of money from the federal government to spend on transportation, but with hardly anything in the way of an instruction manual. And, left to their own devices, states have a poor record of holding themselves to any standards regarding the economic impact of how they choose to spend that money.
Norboge’s research highlights how four states – Indiana, Kansas, North Carolina, and Michigan – used economic analysis to “improve their transportation investment decisions and increase public support for their transportation programs,” according to Eno Center President Joshua Schank.
While each state used at least some combination of jobs data and gross state product to measure economic impact over a span of 20 or 30 years, they used different computer models and were free to weight their factors differently based on public input.
Consider the case of Kansas DOT’s new Highway Selection Program. Following the results of a 900-stakeholder survey, KDOT determined that economic impacts should account for 25 percent of the rationale for building a given highway (often shorthand for transportation) project. This was intended to change the perception that road builders were more concerned with the physical characteristics of a project than with its impact to a community. And to make sure the new methodology was making a difference, KDOT kept in touch with its constituents, using the internet and public meetings to engage citizens in new ways.
The result has been a shift in the kinds of projects built by the Kansas DOT.
Full Story: Under economic impact analysis, highway expansion loses appeal
Source: DC.StreetsBlog, June 12, 2012