Freight Transportation
National Policy and Strategies Can Help Improve Freight Mobility Gao ID: GAO-08-287 January 7, 2008Continued development and efficient performance of the nation's freight transportation system is vital to maintaining a strong U.S. economy and sustaining our nation's competitive position in the global economy. Yet, increasing congestion on our nation's roads and rail lines threatens to undermine the efficiency of our freight transportation system. Although the Department of Transportation (DOT) has taken some steps to enhance freight mobility, there is growing concern that additional action is needed. To assist the Congress in enhancing national freight mobility, GAO reviewed (1) factors that contribute to constrained freight mobility and their effects in areas with nationally significant freight flows, and (2) approaches to address freight mobility in those areas and the challenges decision makers face in implementing those approaches. GAO analyzed freight transportation data and interviewed stakeholders in four areas with large freight flows.
A number of factors contribute to constrained freight mobility and, together, these factors have significant adverse impacts. First, growing freight transportation demand decreases freight mobility. Volumes of goods shipped by trucks and railroads, for example, are projected to increase by 98 percent and 88 percent, respectively, by 2035. Second, the capacity of our transportation system is constrained by other factors, including the cost of surmounting geographic barriers, such as mountain ranges and waterways, population density, and urban land-use development patterns. Third, freight mobility is limited by inefficiencies in how infrastructure is used, such as poor road signal timing and prices paid by users that do not align with infrastructure costs, resulting in congestion. The widening gap between the volumes of goods and available system capacity is increasing transportation congestion. Constrained freight mobility has adverse economic costs for consumers, shippers, and carriers, as well as in urban centers where congestion exacerbates environmental pollution and increases health risks, such as respiratory illnesses. Although freight transportation stakeholders have advanced projects and proposals to enhance freight mobility by building new infrastructure and increasing system efficiency, public planners face several challenges when advancing freight improvement projects. These challenges include competition from nonfreight projects for public funds and community support in the planning process, lack of coordination among various government entities and private sector stakeholders, and limited or restricted availability of public funds available for freight transportation. Compounding these challenges facing state and local transportation planners is that the federal government is not well positioned to enhance freight mobility due to the absence of a clear federal strategy and role for freight transportation, an outmoded federal approach to transportation planning and funding, and the unsustainability of planned federal transportation funding. When combined, these challenges and factors hinder the ability of public sector agencies to effectively address freight mobility and highlight the need to reassess the appropriate federal role and strategy in developing, selecting, and funding transportation investments, including those for freight transportation.
RecommendationsOur recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
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United States Government Accountability Office:
GAO:
Report to the Ranking Member, Committee on Environment and Public
Works, U.S. Senate:
January 2008:
Freight Transportation:
National Policy and Strategies Can Help Improve Freight Mobility:
GAO-08-287:
GAO Highlights:
Highlights of GAO-08-287, a report to the Ranking Member, Committee on
Environment and Public Works, U.S. Senate.
Why GAO Did This Study:
Continued development and efficient performance of the nation‘s freight
transportation system is vital to maintaining a strong U.S. economy and
sustaining our nation‘s competitive position in the global economy.
Yet, increasing congestion on our nation‘s roads and rail lines
threatens to undermine the efficiency of our freight transportation
system. Although the Department of Transportation (DOT) has taken some
steps to enhance freight mobility, there is growing concern that
additional action is needed. To assist the Congress in enhancing
national freight mobility, GAO reviewed (1) factors that contribute to
constrained freight mobility and their effects in areas with nationally
significant freight flows, and (2) approaches to address freight
mobility in those areas and the challenges decision makers face in
implementing those approaches. GAO analyzed freight transportation data
and interviewed stakeholders in four areas with large freight flows.
What GAO Found:
A number of factors contribute to constrained freight mobility and,
together, these factors have significant adverse impacts. First,
growing freight transportation demand decreases freight mobility.
Volumes of goods shipped by trucks and railroads, for example, are
projected to increase by 98 percent and 88 percent, respectively, by
2035. Second, the capacity of our transportation system is constrained
by other factors, including the cost of surmounting geographic
barriers, such as mountain ranges and waterways, population density,
and urban land-use development patterns. Third, freight mobility is
limited by inefficiencies in how infrastructure is used, such as poor
road signal timing and prices paid by users that do not align with
infrastructure costs, resulting in congestion. The widening gap
between the volumes of goods and available system capacity is
increasing transportation congestion. Constrained freight mobility has
adverse economic costs for consumers, shippers, and carriers, as well
as in urban centers where congestion exacerbates environmental
pollution and increases health risks, such as respiratory illnesses.
Although freight transportation stakeholders have advanced projects and
proposals to enhance freight mobility by building new infrastructure
and increasing system efficiency, public planners face several
challenges when advancing freight improvement projects. These
challenges include competition from nonfreight projects for public
funds and community support in the planning process, lack of
coordination among various government entities and private sector
stakeholders, and limited or restricted availability of public funds
available for freight transportation. Compounding these challenges
facing state and local transportation planners is that the federal
government is not well positioned to enhance freight mobility due to
the absence of a clear federal strategy and role for freight
transportation, an outmoded federal approach to transportation planning
and funding, and the unsustainability of planned federal transportation
funding. When combined, these challenges and factors hinder the ability
of public sector agencies to effectively address freight mobility and
highlight the need to reassess the appropriate federal role and
strategy in developing, selecting, and funding transportation
investments, including those for freight transportation.
Examples of Railroad and Highway Freight Movements:
[See PDF for image]
This figure contains two photographs depicting railroad and highway
freight movements.
Sources: Digital Vision and Port of Long Beach.
[End of figure]
What GAO Recommends:
GAO recommends that DOT work with the Congress and freight stakeholders
to develop a national strategy to transform the federal government‘s
involvement in freight transportation projects. This strategy should
include defining federal and nonfederal stakeholder roles and using new
and existing federal funding sources and mechanisms to support a
targeted, efficient, and sustainable federal role. DOT did not comment
on the recommendation.
To view the full product, including the scope and methodology, click on
[hyperlink, http://www.GAO-08-287]. For more information, contact
JayEtta Z. Hecker, (202) 512-2834 or heckerj@gao.gov.
[End of section]
Contents:
Letter:
Results in Brief:
Background:
Constrained Freight Mobility Could Have Negative Economic,
Environmental, and Health Implications:
Although Freight Transportation Stakeholders Have Advanced Various
Approaches to Improve Freight Mobility, Planning, Coordination, and
Funding Challenges Impede Progress:
Conclusions:
Recommendation for Executive Action:
Agency Comments:
Appendix I: Objectives, Scope, and Methodology:
Appendix II: Critical Factors and Questions and Components of a Federal
Role in Freight-Related Transportation and Infrastructure Investments:
Appendix III: GAO Contact and Staff Acknowledgments:
Tables:
Table 1: DOT Actions Taken to Improve Freight Mobility:
Table 2: Shipment Volumes by Mode in 2002 and 2035 Projections:
Table 3: Examples of Capital Projects to Enhance Freight Mobility:
Table 4: Examples of Proposals to Maximize the Use of Existing
Capacity:
Table 5: Examples of Projects and Proposals to Influence User Behavior
and Manage Demand:
Table 6: Key Transportation Challenges and Considerations Facing
Federal Decision Makers:
Table 7: Names and Locations of Organizations Contacted:
Table 8: GAO's Critical Factors and Questions for Determining an
Appropriate Federal Role in Freight-Related Transportation:
Table 9: Three Components of GAO's Framework to Guide Federal
Involvement in Freight-Related Infrastructure Investments:
Figures:
Figure 1: Inland Movement of Maritime Cargo from Port of Los Angeles by
Truck in 1998:
Figure 2: Example of Goods Movement from Port of Entry to Consumer:
Figure 3: High Volume of Trucks Servicing the Port of Long Beach Are
Routinely Delayed by Congestion on I-710:
Figure 4: Example of How Constrained Freight Mobility Increases the
Cost of Transportation and Consumer Goods:
Abbreviations:
AAR: Association of American Railroads:
ACTA: Alameda Corridor Transportation Authority:
BTS: Bureau of Transportation Statistics:
CARB: California Air Resources Board:
CMAQ: Congestion Mitigation and Air Quality:
CREATE: Chicago Region Environmental and Transportation Efficiency:
DOT: Department of Transportation:
EPA: Environmental Protection Agency:
FHWA: Federal Highway Administration:
HOT: high-occupancy toll:
ISTEA: Intermodal Surface Transportation Equity Act:
MPO: metropolitan planning organization:
RRIF: Railroad Rehabilitation and Improvement Financing:
TIFIA: Transportation Infrastructure Finance and Innovation Act:
TRB: Transportation Research Board:
TTI: Texas Transportation Institute:
[End of section]
United States Government Accountability Office:
Washington, DC 20548:
January 7, 2008:
The Honorable James M. Inhofe:
Ranking Member:
Committee on Environment and Public Works:
United States Senate:
Dear Mr. Inhofe:
Strong productivity gains in the U.S. economy hinge, in part, on
transportation networks working efficiently. Continued development and
efficient management of the nation's freight transportation system--
especially highways and rail lines that connect international gateways
and intermodal facilities to retailers, producers, and consumers--are
important to sustaining the nation's competitive position in the global
economy. However, the increasing congestion within the freight
transportation system poses a threat to the efficient flow of the
nation's goods and has strained the system in some locations. Moreover,
recent growth in international trade has placed even greater pressures
on ports, border crossings, and distribution hubs--key links in the
freight transportation system. Congestion delays that significantly
constrain freight mobility in these areas could result in serious
economic implications for the nation.
Public sector transportation agencies at the federal, state, and local
levels have a significant role in developing and efficiently managing
the freight transportation system; however, private sector entities,
such as railroads and trucking firms, also play a significant role in
enhancing freight mobility. Federal law establishes federal funding and
financing programs for surface transportation projects. Federal support
for freight transportation infrastructure projects mainly occurs
through these programs and is allocated to surface transportation modes
and purposes. Highway trust fund dollars are apportioned to states
according to statutory formulas, and states, in turn, make investment
decisions. In past work, we have observed that this framework can lead
to a bias for passenger-oriented projects and differential mode
treatment, both of which can put freight at a disadvantage.[Footnote 1]
State and local planners are more likely to fund projects that directly
benefit passengers in their localities rather than freight traffic that
moves through the region. Further, though federal law has established
intermodal goals and encouraged states to engage in intermodal
planning, funding sources have remained largely tied to individual
modes. Current federal transportation programs continue this modal
treatment. We have previously reported that these factors pose
significant challenges to transportation planners in advancing freight
projects.[Footnote 2] Although steps have been taken at the federal
level to address these challenges, there is a growing concern that the
current funding structure is not well suited to advancing freight
improvements and that additional action might be needed to better
allocate federal funds in order to address impediments to freight
mobility.
As requested, this report provides information on and analyses of
issues related to constrained freight mobility in areas with nationally
significant freight flows. For this report, we considered areas with
nationally significant freight flows to be those that are either a
major seaport, international border, or freight distribution hub and
areas that combine some or all of these characteristics. Specifically,
this report examines (1) factors that contribute to constrained freight
mobility in areas with nationally significant freight flows and their
effects and (2) approaches that are being used to address impediments
to freight mobility in selected regions with nationally significant
freight flows and the challenges that freight transportation decision
makers face in implementing solutions.
To fulfill our objectives, we reviewed and analyzed industry, academic,
and government research reports and analytical studies; interviewed a
wide range of stakeholders, including federal, state, and local
transportation officials and private industry representatives; and
conducted four case studies in regions that represented either
international gateways or major distribution hubs.[Footnote 3] In
selecting regions for our case study analyses, we used information
available from the Federal Highway Administration's (FHWA) Freight
Analytic Framework database regarding freight volumes and values to
judgmentally select at least one seaport, inland waterway port, land
border, and major distribution center. In addition, we focused mainly
on overland surface transportation from ports to markets and on
intermodal freight, as these demonstrate freight movement between modes
and across multiple jurisdictional lines. The results of our case study
analyses are not generalizable because the locations selected are not
necessarily representative of other types of international gateways and
distribution hubs. See appendix I for more details about our scope and
methodology. We conducted this performance audit from July 2006 through
January 2008 in accordance with generally accepted government auditing
standards. Those standards require that we plan and perform the audit
to obtain sufficient, appropriate evidence to provide a reasonable
basis for our findings and conclusions based on our audit objectives.
We believe that the evidence obtained provides a reasonable basis for
our findings and conclusions based on our audit objectives.
Results in Brief:
A number of factors contribute to constrained freight mobility, which
when combined, have significant adverse economic, environmental, and
health impacts. One factor is the growing demand for freight
transportation, as reflected by the increasing volume of domestic and
international freight that is moved on the nation's transportation
system. According to Department of Transportation (DOT) estimates, the
volume of goods moved by truck and rail is projected to increase 98
percent and 88 percent, respectively, by 2035 from 2002 levels. Another
factor is that adding capacity to accommodate this projected increased
demand for freight transportation will be constrained by limitations on
the nation's transportation infrastructure, including geographic
barriers, such as mountain ranges and waterways, population density,
and urban land-use development patterns. A third factor is how freight
mobility is limited by inefficiencies in how infrastructure is used.
For example, the extent to which carriers bear the full cost of their
infrastructure use varies across modes and can contribute to overuse
and congestion on some modes. As a result of these factors, freight
congestion is rising and is expected to increase in the future. This
congestion will have a number of negative impacts. For example,
producers, shippers, and consumers will suffer the higher economic
costs of freight transportation. One study estimates that highway
congestion alone costs shippers $10 billion annually.[Footnote 4] Also,
constraints on freight mobility result in undesirable environmental
impacts, such as air pollution, and contribute to increased risks for
illnesses, such as respiratory disease.
Although freight transportation stakeholders have advanced approaches
to improve freight mobility, public planners still face planning,
coordination, and funding challenges when attempting to advance freight
improvements. Freight transportation stakeholders have advanced
various approaches in order to improve freight mobility. Their
proposals involve adding physical capacity to the freight
transportation system by building new facilities and increasing the
efficiency of existing infrastructure through projects designed to
improve traffic flows or influence driver behavior. Although
stakeholders have taken steps to enhance freight mobility, public
planners in areas with nationally significant freight flows face
challenges when attempting to advance freight improvements. These
challenges include competition for public funds from nonfreight
projects, gaining community support in the planning process, lack of
coordination among various government entities and private sector
stakeholders, and limited or restricted availability of public funds
for freight transportation. These challenges are exacerbated by the
absence of a clear federal strategy for enhancing freight mobility; an
outmoded, modally-focused federal approach to transportation planning
and funding; and projected revenue shortfalls in the Highway Trust
Fund, which public sector agencies use to fund the bulk of their
transportation projects. When combined, these challenges and factors
hinder the ability of public sector agencies to effectively address
freight mobility and highlight the need to reassess the appropriate
federal role and strategy in developing, selecting, and funding
transportation investments, including those for freight
transportation.
We are making a recommendation to the Secretary of Transportation to
develop, in conjunction with Congress and public and private
stakeholders, a national strategy for freight transportation in order
to improve freight mobility by more clearly defining the federal role
in the freight transportation network and to begin to align federal
expenditures with economically significant national public benefits.
This strategy should clearly define the federal role using criteria to
identify areas of national significance and determine the use of
federal funds in those areas; establish the roles of nonfederal
stakeholders; and use new and existing federal funding sources and
mechanisms to support a targeted, cost-effective, and sustainable
federal role. DOT did not comment on the recommendation; however, DOT
officials did provide technical comments, which we have incorporated
into this report, as appropriate.
Background:
Freight movement is vital to the functioning of the national economy,
and increases in freight volumes have closely coincided with increases
in productivity and the gross domestic product. Domestic producers are
increasingly reliant on suppliers from around the world and are finding
global markets increasingly profitable for the sale of their products.
Additionally, to control costs, domestic production often relies on
prompt, timely shipments of materials in small batches. Domestic
retailers have implemented inventory management systems that lower
overall costs by relying on prompt shipping of needed goods, instead of
more costly warehousing. In 2003, the nation's top 14 freight gateways
handled more than 50 percent of total U.S. international merchandise
trade by value, but, despite this concentration, the reach of this
trade is nationwide. For example, the Port of Los Angeles handles cargo
destined for the entire continental United States, as shown in the
example in figure 1.
Figure 1: Inland Movement of Maritime Cargo from Port of Los Angeles by
Truck in 1998:
[See PDF for image]
This figure is an illustration of inland movement of maritime cargo
from Port of Los Angeles by truck in 1998 on a map of the continental
United States. Depicted are lines which represent the following
volumes:
0 - 250,000 tons;
250,000 - 500,000 tons;
500,000 - 1,000,000 tons;
More than 1,000,000 tons.
Source: Department of Transportation.
[End of figure]
The movement of goods involves a wide array of public and private
stakeholders, including all levels of government that plan and fund
transportation projects, as well as the firms that use and provide
freight transportation, such as railroads and trucking firms.
Frequently, freight transportation is intermodal and crosses multiple
jurisdictional boundaries within the United States. Figure 2 depicts an
example of the movement of goods from a port to a consumer.
Figure 2: Example of Goods Movement from Port of Entry to Consumer:
[See PDF for image]
This figure is series of illustrations depicting the movement of goods
from port of entry to consumer. The following data is depicted:
International container ship arrives at U.S. port;
Trucks transport containers out of port;
Containers are transferred to rail at an intermodal facility;
At a distant intermodal facility, containers are transferred back to
trucks;
Distribution center receives containers from intermodal facility and
unpacks goods;
Warehouse receives goods from distribution center and serves retailer;
Retailer receives delivery of goods from warehouse;
Consumer buys goods from retailer.
Source: GAO.
[End of figure]
The many freight transportation stakeholders involved in maintaining
and improving the freight transportation system have complex and varied
roles, but none are responsible for the entire system. Public planning
agencies, such as state departments of transportation and local
metropolitan planning organizations (MPO) have principal responsibility
for planning and funding new highway infrastructure and maintaining
existing highways. Public planning agencies may also work with ports,
shippers, and terminal operators to forecast freight volumes and plan
needed system improvements to port infrastructure. The Army Corps of
Engineers, too, provides technical information and harbor dredging.
Rail and trucking firms transport goods out of ports to warehouses and
distribution facilities, from which goods are routed to final
destinations. While public sector agencies fund transportation
improvements with proceeds from taxes, railroad companies, which are
largely private companies, make investments in their own networks to
improve operations and expand infrastructure capacity.
DOT has also taken several actions in the past 5 years to address key
impediments to freight mobility by developing programs and policies to
address congestion in the United States. Specifically, it has drafted a
framework for national freight policy, released a national strategy to
reduce congestion, and created a freight analysis framework to forecast
freight flows along national corridors and through gateways. In
addition, DOT has provided guidance to simplify access to existing
funding and recommended ideas for congressional consideration to make
more funding available, created working groups to increase
collaboration, and made data and analysis tools available.[Footnote 5]
(See table 1 for more detail regarding specific DOT actions to improve
freight mobility.)
Table 1: DOT Actions Taken to Improve Freight Mobility:
DOT action: Finance Guidebook for Freight;
Description: Summarizes the potential funding available for freight
projects.
DOT action: Freight Analysis Framework;
Description: Quantifies existing freight flows and forecasts future
freight flows along national corridors and through international
gateways.
DOT action: Intermodal Freight Technology Working Group;
Description: Cooperative effort of public and private stakeholders to
identify and operationally test technology solutions to freight
transportation issues.
DOT action: Transportation Planning Capacity Building Program;
Description: Provides a source of information to state departments of
transportation and MPOs. Through this program, information has been
posted on how to include freight interests in the planning process.
DOT action: Freight Professional Development Program;
Description: Offers training, education, technical assistance, and a
resource library to assist state and local officials, as well as,
private stakeholders in freight transportation planning and systems.
DOT action: Guide to Quantifying the Economic Impacts of Federal
Investments in Large-Scale Freight Transportation Projects;
Description: Helps to ensure that freight projects are appropriately
considered in national, regional, and state decisions about the future
of transportation system investments.
DOT action: Freight Industry Roundtable and Draft Framework for a
National Freight Policy;
Description: The Freight Industry Roundtable outreach effort led to the
creation of the Draft Framework for a National Freight Policy, which is
a new policy initiative to address freight transportation concerns.
Viewed as a living document, the Draft Framework is intended to
stimulate discussion and local responses.
DOT action: Corridors of the Future congestion program;
Description: Encourages states to think beyond their boundaries to
reduce congestion on some of the nation's most critical trade
corridors. DOT plans to facilitate the development of these corridors
by helping project sponsors reduce institutional and regulatory
obstacles associated with multistate and multimodal corridor
investments.
DOT action: Freight performance measures;
Description: Measures travel speeds and travel time reliability for
commercial vehicle traffic on 25 freight significant corridors, and
measures crossing times and crossing time reliability on five
U.S./Canadian border crossings.
DOT action: New offices established by the Maritime Administration;
Description: The Maritime Administration (MARAD) established 10 offices
in U.S. ports to help promote and coordinate solutions across
jurisdictional lines and provide local, state, and regional
stakeholders with a local link to MARAD. Additionally, MARAD
established the office of Marine Highways and Passenger Vessel Services
to focus efforts to relieve road and rail congestion by shifting some
cargoes to coastal and inland waterways.
Sources: GAO analysis of DOT data and GAO-07-718.
[End of table]
In 2006, DOT attempted to move beyond the traditional modal approach to
freight transportation by developing a Draft Framework for a National
Freight Policy. Due to the federal government's current limited role in
freight transportation, the Draft Framework focuses on facilitating
freight transportation through collaborative action between the public
and private sectors. The Draft Framework outlines a vision and
objectives, then details strategies and tactics that both public and
private sector transportation stakeholders can pursue to achieve those
objectives. DOT describes its Draft Framework as a living document and
emphasizes that the nation's freight transportation challenges are of
such a nature and magnitude that governments at all levels and the
private sector must work together to address them.
In May 2006, DOT also released the National Strategy to Reduce
Congestion on America's Transportation Network.[Footnote 6] The primary
goal of the plan is to encourage states to explore innovative financing
as a tool to reduce congestion on some of the nation's most critical
trade corridors, improve the flow of goods across our nation, and
enhance the quality of life for U.S. citizens. It outlines a six-point
plan to address both freight and passenger congestion, including (1)
creating Urban Partnership Agreements with "model cities" to implement
demonstration projects, such as congestion pricing, tolling, express
bus services, telecommuting, and flex-scheduling; (2) removing barriers
to private sector investment in the construction, ownership and
operation of transportation infrastructure; (3) working with state and
local stakeholders on reducing freight congestion in Southern
California, a major gateway for international freight coming into the
United States; and (4) establishing a Corridors of the Future program
to help identify and fund six major growth highway corridors in need of
long-term investment, among others.[Footnote 7]
Constrained Freight Mobility Could Have Negative Economic,
Environmental, and Health Implications:
The volume of domestic and international freight moving through the
country has increased dramatically, and continued growth is expected in
the future. Concurrently, the capacity of the nation's freight
transportation infrastructure has not increased at the same rate as
demand, and the infrastructure in many areas that handle nationally
significant freight flows is constrained by geographic and land-use
development patterns. Inefficiencies in the use of freight
infrastructure also limit the system's capacity. All of these factors
have contributed to increasing freight congestion, which, in turn, has
led to a number of adverse effects, including (1) higher direct
economic costs for producers and consumers; (2) higher indirect costs,
such as passenger traffic congestion costs that affect the quality of
life of all transportation users; and (3) aggravated environmental
impacts, such as air pollution, and associated health risks, such as
respiratory illness.
Increasing Demand for Freight Transportation Services Is Straining the
Nation's Supply of Transportation:
Increasing demand for freight transportation services to provide
efficient goods movement strains the nation's available capacity, or
supply, of infrastructure. This increased demand is reflected in the
growing volume of international and domestic freight moving across the
transportation system. On the supply side, the capacity of the nation's
transportation system has not increased with increased demand.
Exacerbating this problem, many freight corridors and major
destinations for freight are located in areas that are constrained due
to geographic barriers, such as waterways and mountains, and have
patterns of land-use development that do not easily accommodate growth
in freight transportation. Finally, some infrastructure is not used as
efficiently as possible because of operational inefficiencies and
pricing mechanisms that do not charge users the full cost of their
infrastructure use, among others.
Constrained Freight Mobility Linked to Increasing Volume of
International and Domestic Goods Movement:
The volume, by value and weight, of international and domestic goods
movement has increased significantly in recent years, and this increase
is a factor contributing to constrained freight mobility. According to
the Bureau of Transportation Statistics (BTS), the value of U.S.
international trade merchandise imported and exported through the
nation's ports and borders increased by approximately 6 percent per
year in dollar terms, on average, from $889 billion in 1990 to about $2
trillion in 2003.[Footnote 8] According to another BTS study, domestic
freight moved by rail and truck increased from 2.4 trillion ton-miles
to approximately 3 trillion ton-miles between 1996 and 2005.[Footnote
9] These increases are partly linked to changes in supply-chain
management as increasing volumes of goods are moved over the system in
smaller, more frequent shipments to more distant destinations.[Footnote
10]
The freight volume handled by ports, railways, and highways is expected
to continue to grow. While domestic and international freight are both
expected to increase in the future, international freight volumes are
expected to increase at a faster rate than domestic freight volumes.
According to a DOT study, freight moving through the nation's largest
international gateway ports may quadruple by 2025.[Footnote 11] Volume
growth is expected across all major modes of surface transportation--
truck, rail, and water--and intermodal shipments are expected to be a
larger proportion of the value of total shipments than today. (See
table 2.) This trend was also evident at the sites we visited. For
example, according to the Houston-Galveston Area Council, the regional
planning organization, freight tonnage hauled on the area's railways is
projected to increase from 124 million tons in 2004 to over 200 million
tons in 2035. In addition to this growth, freight traffic patterns may
also shift between ports. For example, according to the Maritime
Administration, the expansion of the Panama Canal and the increased use
of the Suez Canal could shift some container traffic from ports on the
west coast to new and existing east coast ports.
Table 2: Shipment Volumes by Mode in 2002 and 2035 Projections
(Millions of tons):
Truck:
2002: 11,539;
2035: 22,814;
Percent increase: 98.
Rail:
2002: 1,879;
2035: 3,525;
Percent increase: 88.
Water:
2002: 701;
2035: 1,041;
Percent increase: 49.
Intermodal[A]:
2002: 1,292;
2035: 2,598;
Percent increase: 101.
Source: GAO analysis of FHWA's Freight Facts and Figures 2006 data.
[A] Intermodal includes U.S. Postal Service, courier shipments, and all
intermodal combinations except air and truck.
[End of table]
The Relative Shortfalls in New Transportation Infrastructure Capacity
Have Constrained Freight Mobility:
According to studies on transportation infrastructure
investments[Footnote 12] and several of the stakeholders with whom we
spoke in conducting this review, the capacity of the nation's freight
transportation infrastructure is not keeping pace with the increasing
volumes of freight moving on the system. This is particularly evident
with respect to rail and highway modes.
* Rail capacity has not kept pace with recent increases in demand.
According to the American Association of Railroads (AAR), since 1980,
total track miles have declined, but the number of tons moved per mile
has tripled. Though AAR estimates that overall capacity is currently
adequate on 88 percent of the nation's rail system, it notes that the
system is beginning to reach its capacity limits.[Footnote 13] Some
railroad corridors between major markets do not have double tracked
right-of-ways; adequate passing areas, intermodal yards, or switching
facilities; or bridges or tunnels that can simultaneously accommodate
multiple trains on different routes. For example, the 1.7-mile Howard
Street rail tunnel in Baltimore, which is on a major corridor linking
the mid-Atlantic with Chicago, has only one track, does not accommodate
double stack intermodal container trains, and the curves near the
tunnel limit speeds to only 25 miles per hour. As we and others have
found, it is uncertain whether private rail companies will be able and
willing to make the necessary infrastructure investments to keep pace
with projected demand for rail capacity.[Footnote 14]
* Highway capacity, too, has not increased as fast as demand. For
example, according to the Texas Transportation Institute (TTI), road
use increased 15 percent or faster than capacity between 1982 and 2005
in 80 out of the 85 urban areas that TTI studied. As a result, TTI
estimated that in 2005, one in three trips took place in congested
conditions, whereas only one in nine did in 1982.[Footnote 15] Funding
to expand the road system, at both the federal and state levels, is
also limited, and much of the current funding available goes toward
maintenance and repair instead of capacity expansion projects.[Footnote
16]
Intermodal connections have also failed to keep pace with demand. As we
have previously reported, the nation's transportation system lacks
adequate intermodal connections to efficiently move freight across
modes.[Footnote 17] Intermodal infrastructure improves the connections
between modes, which, in turn, can improve freight mobility. In some
cases, however, current intermodal infrastructure constrains freight
mobility. For example, the roads that connect ports to highways are
heavily used by trucks but are often in poor condition, creating
freight bottlenecks.
Geography and Urban Land-Use Development Patterns Constrain Freight
Mobility:
In some regions with nationally significant freight flows, geography
and patterns of land development constrain freight mobility, making it
difficult to cost-effectively increase infrastructure capacity.
Geographic constraints include water barriers and mountain ranges that
can be crossed only at a limited number of points. For example, the New
York City metropolitan region is divided by waterways that can only be
crossed at a limited number of bridges and tunnels, and building
additional bridges or tunnels can take billions of dollars and years to
complete.[Footnote 18] Because of the difficulty of adding highway
capacity in densely populated, developed urban areas, these bridges and
tunnels must handle increasing volumes of freight traffic, even though
they are not designed to handle current and projected volumes.
Additionally, some bridges can be used by trucks only under special
restrictions, and one--the Brooklyn Bridge--prohibits trucks entirely.
Once in Manhattan, trucks have a difficult time navigating narrow
roadways and finding adequate parking to make deliveries. Trucks also
compete with passenger vehicles on these routes, particularly during
peak travel periods, further decreasing freight mobility on roadways,
bridges, and tunnels. Though these problems are particularly dramatic
in lower Manhattan, other large, urban areas in the country also
experience similar problems.
Freight movement in population centers and along major corridors is
also constrained by the physical barriers created by urban land-use
development patterns and the built-up urban environment, such as
buildings and other facilities that are adjacent to ports, rail yards,
and highways. According to several shippers, the areas surrounding
critical freight infrastructure are increasingly dense with
development, making it more difficult and expensive to build or expand
centrally located freight facilities. For example, land near the Port
of New York that was previously vacant or used for freight warehouses
has recently been redeveloped into high-value commercial and
residential property. Consequently, freight distribution centers have
moved away from the urban core to the New Jersey suburbs and eastern
Pennsylvania where land values are comparatively lower, but where
access to ports is more difficult. Major transportation corridors are
also increasingly squeezed by development and population density, and
freight infrastructure expansion along these corridors is difficult to
implement or simply does not occur. For example, the Alameda Corridor-
-a rail project designed to help move freight from the Ports of Los
Angeles and Long Beach to the transcontinental rail facilities near
downtown Los Angeles--took 18 years to complete, in part, because the
project had to be built underground to bypass highly developed and
populated urban areas. In addition, the development patterns of cities
are increasingly dispersed across wide-geographic areas. The
Transportation Research Board (TRB) reports that this urban land-use
pattern disadvantages rail and favors trucking, which better
accommodates smaller, relatively short-distance shipments.[Footnote
19] However, as a result of this land-use pattern, trucks must travel
farther from ports to distribution centers and from distribution
centers to final destinations.
Inefficient Use of Existing Infrastructure Constrains Freight Mobility:
Freight mobility in areas with nationally significant freight flows is
further constrained because, in some instances, existing port, road,
and rail infrastructure is not used efficiently.[Footnote 20] A number
of factors can contribute to inefficiencies in freight movement,
including operational constraints and infrastructure pricing
mechanisms.[Footnote 21]
A variety of operational inefficiencies occur in the daily movement of
goods. For example, at ports, operational inefficiencies are caused
when port operators must adjust their work practices because empty
containers occupy valuable acreage. At the Port of Los Angeles, fewer
than 2 percent of the containers that arrive at the port are empty, but
approximately 60 percent are shipped out of the port empty because
there are not enough exported goods to fill all available
containers.[Footnote 22] Consequently, as port operations take place
amid stacks of empty containers, the time it takes to move freight
through the port increases, and the ability of the port to handle
increases in freight volumes declines. The rail network, too,
experiences some operational inefficiency that can constrain freight
mobility. As we have reported in the past, private rail companies might
be able to serve their customers more efficiently if they instituted
collaborative operational processes, such as sharing terminal
facilities for a fee, which could allow more rail companies access to
customers near specific terminals or reciprocal switching. For example,
one rail company could deliver, for a fee, railcars to another rail
company's customers.[Footnote 23] Inefficiencies in roadway use include
daily management and operations practices that do not maximize existing
roadway capacity, such as uncoordinated timing of traffic signals and
inefficient incident response capabilities.
In a number of ways, current pricing of freight transportation
infrastructure can result in inefficient use by failing to align the
capital and operational costs of infrastructure with the fees paid by
users. First, the financing mechanisms that collect fees from the
users--freight carriers--of freight transportation infrastructure do
not consistently collect revenues in direct relation to the full cost
of providing the infrastructure these carriers use. Consequently,
prices often do not provide the correct signals to carriers as they
make decisions about their use of transportation infrastructure and the
prices they charge their customers. Second, the extent to which
carriers bear the full cost of their infrastructure use varies across
modes, sometimes distorting the competitive position between them. As a
result, a mode that is more costly to society might be used for some
shipments if the fees charged to users only reflect a portion of the
full cost of the selected mode. For example, according to DOT's most
recent calculations, the revenues generated from federal fuel taxes
levied on smaller trucks that weigh less than 25,000 pounds cover 150
percent of their cost impact, but larger trucks weighing over 100,000
pounds pay only 40 percent of their costs.[Footnote 24] From an
economic standpoint, this relationship between revenue and cost
distorts the competitive environment by making it appear that heavier
trucks are a less expensive shipping method than they actually are and
puts other modes, such as rail and maritime, at a disadvantage.
[Footnote 25]
If Present Trends Continue, Freight Congestion Is Likely to Increase:
The combination of increasing demand for freight transportation
infrastructure and capacity limitations has contributed to increased
congestion and constrained freight mobility. Many of the highways used
heavily by trucks to move freight are already congested today. For
example, as shown in figure 3, Interstate 710, a principal route
leaving the Port of Long Beach, is routinely congested with port and
passenger traffic. Such congestion on many freight significant
corridors is expected to worsen in the future.[Footnote 26] Likewise,
congestion is expected to become a regular occurrence on many intercity
highways in addition to congestion on urban highways, where congestion
is already common. For example, according to FHWA projections, without
any additional capacity, congestion during peak periods occurring on
highways comprising the National Highway System will increase from
10,600 miles in 2002 to 20,000 miles in 2035.[Footnote 27] Similarly,
congestion could worsen on the nation's rail lines as freight volumes
continue to grow. For example, a recent AAR study predicts that,
without system improvements, the expected increases in rail volume by
2035 will cause 30 percent of primary rail corridors to operate above
capacity and another 15 percent at capacity. This congestion, the AAR
report states, might affect the entire country and could shut down the
national rail network.[Footnote 28] Ports are also likely to experience
greater congestion in the future as more and larger ships compete for
limited berths.
Figure 3: High Volume of Trucks Servicing the Port of Long Beach Are
Routinely Delayed by Congestion on I-710:
[See PDF for image]
This figure is a photograph of highway congestion on I-710 in Long
Beach.
Source: Port of Long Beach.
[End of figure]
Constrained Freight Mobility Results in Higher Economic Costs and
Environmental and Health Risks:
Congestion caused by constrained freight mobility has led to negative
effects that impact both the direct users of freight services--
producers, shippers, and receivers--as well as passenger traffic and
individuals living in congested areas. These impacts include higher
direct economic costs for freight services and indirect economic costs
borne by passenger traffic impacted by freight congestion. Furthermore,
constraints on freight mobility cause negative environmental impacts,
such as air pollution, and their associated health risks, particularly
to vulnerable populations living next to congested areas.
Constrained Freight Mobility Has Negative Direct Economic Effects:
Transportation costs impact the total cost of many goods and services
and affect all the stakeholders in the supply chain, as these costs are
factored into the prices they charge their customers. For example, one
shipper told us that deliveries to a congested urban area cost about
five times more than those to noncongested areas. One study estimates
that roadway congestion delays cost shippers approximately $10 billion
per year and notes that although the freight sector experiences about
27 percent of congestion costs, truck traffic represent only 5 percent
of total vehicle miles.[Footnote 29] According to a study conducted by
the Texas Department of Transportation, every hour of delay costs
private rail companies operating in the Houston area approximately
$300.[Footnote 30] As shown in figure 4, when freight costs increase
due to constraints on freight mobility, prices also are likely to
increase.
Figure 4: Example of How Constrained Freight Mobility Increases the
Cost of Transportation and Consumer Goods:
[See PDF for image]
This figure is a series of illustrations of how constrained freight
mobility increases the cost of transportation and consumer goods. The
following data is depicted:
International container ship arrives at U.S. port:
Cost increase: Empty containers crowd port.
Trucks transport containers out of port:
Cost increase: Traffic congestion slows key port access routes.
Containers are transferred to rail at an intermodal facility:
Cost increase: Inadequate capacity to handle container volumes
efficiently adds delay.
At a distant intermodal facility, containers are transferred back to
trucks:
Cost increase: Increased train traffic strains rail network and adds
delay.
Distribution center receives containers from intermodal facility and
unpacks goods:
Cost increase: Distribution center is located far away from port and
city adding time and cost to freight transportation.
Warehouse receives goods from distribution center and serves retailer:
Cost increase: Competing development causes urban freight facilities to
become more expensive.
Retailer receives delivery of goods from warehouse:
Cost increase: Limited parking for delivery to be received adds delay.
Consumer buys goods from retailer:
Goods cost more than they would have without delays.
Source: GAO.
[End of figure]
Transportation costs affect businesses' capital investments and
marketing strategies and, in turn, these decisions affect consumers. In
some industries, transportation costs largely define the markets served
and prices offered by individual companies. For example, one
stakeholder told us that rising transportation costs and decreasing
reliability in the Northeast could result in the company adding a new
production facility closer to a major northeastern market that is
currently served by a facility in Virginia. Transportation costs also
can limit the geographic size of the markets in which firms operate. As
the costs of transportation to a given area increase, fewer producers
will ship products to that market. Consequently, a narrower selection
of goods will be available in the market, and goods that are available
could be more expensive due to less competition in that market.
Constraints on freight mobility that reduce the reliability of the
transportation network can play an important role in many business
supply-chain management and production processes. Reduced freight
reliability can cause businesses to take extra steps to work around the
unpredictability of the transportation system. Adjustments could
include carrying higher inventories in warehouses to meet production
needs, planning for longer than normal transit time, and not serving
specific markets that cannot be reliably accessed.[Footnote 31] In
cases in which a solution cannot be found, customers may experience
unforeseen delays and complications in fulfilling their orders.
Industries that use "just-in-time" production processes--and,
therefore, rely on the timely and predictable arrival of goods--are
likely to be especially affected by reductions in the reliability of
the freight transportation system. While supply-chain processes such as
"just-in-time," developed in response to the reliability and low cost
of the transportation system, such supply-chain strategies may not be
economically beneficial in the future should freight mobility decline.
In all of these scenarios, users experience direct economic costs in
the form of higher transportation costs, higher warehousing and
operational costs, or missed opportunities for other investments or
production.
Constrained Freight Mobility Has Negative Indirect Social Costs:
Freight congestion also adds to the social costs of congestion
experienced by passenger traffic. In some cases, the strategies
implemented by freight movers in response to chronic congestion and
poor reliability of the roadways may make congestion worse. For
example, in one congested market, an official from a freight
transportation company explained that the company will sometimes send
multiple trucks for deliveries that it previously completed with only
one truck because it is more likely that at least one truck will
complete its delivery on time. In this instance, though the carrier
minimizes the risk of missed or delayed pick-ups, it incurs increased
operational costs and all users of the roadway experience increased
roadway congestion resulting from the extra truck traffic. The indirect
social costs of such congestion negatively affect the quality of life
of the nation's citizens. The hours already wasted inching along
clogged roads and highways will increase as congestion continues to
worsen. As the transportation system becomes less reliable, people will
have less access to recreation, shopping, and other activities that are
an important part of everyday life. While the cost of added congestion
is dispersed widely across individuals and businesses, the collective
magnitude is high and is likely to increase if freight mobility
decreases in the future.
Constrained Freight Mobility Results in Environmental Pollution and
Increased Health Risks:
While unconstrained freight movement also causes environmental
pollution, constrained freight movement significantly increases
pollution. According to FHWA data, freight transportation is a major
source of nitrous oxide pollution, accounting for 27 percent of all
U.S. nitrous oxide emissions and about one-third of particulate matter
emissions from mobile sources.[Footnote 32] In fact, all four regions
we visited in conducting this study have air quality below EPA
standards. [Footnote 33] Further, the California Air Resource's Board
(CARB) has identified freight movement as the dominant contributor to
transportation pollutants in the state. For example, according to CARB
estimates, freight movement causes approximately 75 percent of the
diesel particulate emissions in California. In some instances,
pollution can be most severe when congestion or another localized
bottleneck slows freight, as large volumes of slow moving truck traffic
cause more air pollution per mile traveled than freely moving trucks
would. These emissions, especially the particulate matter and the
constituent components that form smog, can remain highly concentrated
in a local area.
The environmental pollution that results from constrained freight
mobility, particularly when it occurs in areas proximate to residential
neighborhoods, can cause people to suffer acute negative health issues,
such as respiratory illness. According to public health research,
children and the elderly can be most acutely affected by these
emissions. For example, CARB attributes 2,400 premature deaths
statewide to freight emissions and estimates that health costs of
freight pollution could be $200 billion by 2020. Further, CARB
estimates that, each year, freight emissions result in almost 3,000
hospital admissions due to respiratory or cardiovascular causes and
that 1.1 million days of school are missed.[Footnote 34] While it is
difficult to estimate the extent to which these impacts are
attributable to freight movement generally versus specific freight
bottlenecks, in some cases, it is clear that freight delays exacerbate
the problem.
Although Freight Transportation Stakeholders Have Advanced Various
Approaches to Improve Freight Mobility, Planning, Coordination, and
Funding Challenges Impede Progress:
Freight transportation stakeholders have advanced varied approaches to
improve freight mobility. These have included projects and proposals
both to build new physical capacity within the system and to increase
the efficiency of existing infrastructure. However, state and local
transportation planners still face challenges when attempting to
advance freight improvements. Challenges typically involve three
central issues: (1) securing support for freight improvements within a
public transportation planning process that puts emphasis on modally-
oriented projects that produce more obvious public benefits, such as
highway projects that enhance passenger mobility; (2) reaching
agreement on specific freight improvements among multiple freight
stakeholders, each with their own perspectives and agendas; and (3)
accessing funding sources that are generally modally focused for
freight projects that are often intermodal in nature.
Freight Transportation Stakeholders Have Implemented or Proposed
Capacity-Enhancing Approaches to Improve Freight Mobility:
Through our review of studies on transportation issues and our
discussions with freight transportation stakeholders in the four
regions we visited, we identified two broad approaches that are
currently being implemented or considered by state and local freight
transportation stakeholders to improve freight mobility. The first
approach entails adding new physical capacity to the transportation
network, and the second approach aims to increase the efficiency of
existing infrastructure.
Adding New Physical Capacity in the Freight Transportation System to
Enhance Freight Mobility:
One approach that freight stakeholders are using to improve freight
mobility involves projects and proposals designed to create new
physical capacity. This approach includes building new facilities, such
as intermodal yards, roads, and bridges, and adding more capacity to
existing transportation networks, such as dedicating roads for trucks
or adding new railroad tracks.
In areas that are not as constrained by space or geography to build new
capacity, such as some areas of southern California and Texas, various
projects and proposals are being advanced to build new facilities.
These types of projects and proposals include building new rail
infrastructure, such as tracks and intermodal rail yards; building new
roadways; and replacing bridges with inadequate capacity. (See table 3
for some examples of capacity-adding capital projects.)
Table 3: Examples of Capital Projects to Enhance Freight Mobility:
California: (1) Alameda Corridor. Completed in 2002, the Alameda
Corridor is a 20-mile freight rail line linking the Ports of Los
Angeles and Long Beach to the transcontinental rail yards and railroad
mainlines near downtown Los Angeles. The corridor consists of a below-
ground-level rail corridor that eliminated 200 at-grade crossings,
thereby doubling rail speeds.
California: (2) State Route (SR) 47 Expressway. The primary goals of
this project are to replace an aging bridge, which is too small to
accommodate high truck volumes, and to build an expressway that
bypasses a maze of local, extremely congested roads, which would allow
trucks to quickly haul their loads from the port of Los Angeles and
Long Beach to the Intermodal Container Transfer Facility located three
miles away.
California: (3) Freight railroad improvements. Railroad improvements
include building new intermodal facilities and adding tracks to the
rail network to relieve capacity constraints and enhance freight
mobility. For example, the railroads serving southern California have
added or are beginning to build new double track lines into and out of
Los Angeles to accommodate the growing freight traffic.
California: (4) Gerald Desmond Bridge replacement. This project
involves rebuilding this bridge at the Port of Long Beach, making it
wider to accommodate growing traffic and higher to allow larger ships
to pass underneath.
Texas: (1) Proposed freight rail improvements. In Houston,
transportation planners have proposed several projects to relieve
congestion along busy freight rail corridors, including construction of
new mainline track and a new bridge to relieve congestion in
bottlenecked sections, construction of grade separations to allow for
trains to stop without causing delays or safety hazards to the public,
and construction of new rail corridors that bypass populated
areas.These transportation planners must coordinate with the railroads
to implement these projects because rail infrastructure is owned by the
railroads.
Texas: (2) Trans Texas Corridor. This is a large-scale, multimodal,
tolled transportation project that will span the state from Mexico to
Oklahoma and will be financed, constructed, operated, and maintained by
a combination of public and private sector investors. As envisioned,
each route's road section will include separate freeway lanes for
passenger vehicles and large trucks. The rail section will include
freight and passenger lines. In addition to addressing current trade
flow needs, this project would create some of the future roadway
capacity needed to accommodate increased port-related freight traffic,
especially container traffic. Funding for this project will comprise a
combination of Texas Department of Transportation funds and tolls.
Illinois; Chicago Region Environmental and Transportation Efficiency
(CREATE) project is an example of a project advanced by public agencies
and private investors to ease freight and passenger rail traffic
through the largest rail hub in North America.[A] When completed, the
CREATE Program is expected to reduce congestion on area roadways,
improve air quality, and improve freight and passenger mobility in part
by creating 25 new roadway overpasses or underpasses to eliminate many
grade crossings, creating 6 new rail overpasses to separate passenger
and freight tracks, and upgrading tracks, switches and signal
systems.[B]
Source: GAO and interviews with various transportation stakeholders.
[A] CREATE project partners include the AAR, the Chicago Department of
Transportation, the Illinois Department of Transportation, Metra, and
six Class I freight railroads--Burlington Northern Santa Fe (BNSF),
Canadian National, Canadian Pacific, CSX, Norfolk Southern, and Union
Pacific.
[B] GAO-07-718.
[End of table]
Two areas that we visited--Atlanta and New York City--have less space
to build new infrastructure and are investing in other improvement
projects that are intended to add more physical capacity to the
existing roadway and rail networks. For example, the Georgia Department
of Transportation is proposing to dedicate a number of existing highway
lanes to truck-only lanes to separate truck traffic from commuter
traffic. If combined with a tolling scheme, this approach would also
provide a revenue source to pay for additional infrastructure
improvements. Furthermore, the New York State Department of
Transportation is considering a project that would entail a series of
road ramp reconfigurations along the Van Wyck corridor, near John F.
Kennedy International Airport, that would ease the flow of operations
in moving air cargo out of the airport.
Increasing Efficiency of Existing Infrastructure to Improve Freight
Mobility:
A second approach that freight stakeholders use to improve freight
mobility involves advancing projects and proposals designed to increase
the efficiency of existing infrastructure. Although the projects and
proposals are varied, stakeholders are using two broad strategies. The
first strategy is to improve traffic flows or accommodate increased
freight volumes on existing transportation networks. The second
strategy involves influencing driver behavior and demand.
The first strategy--improving traffic flows within the transportation
system or making maximum use of transportation system capacity--
involves a variety of activities focused on existing roadway and rail
networks. These activities include implementing incident management
programs, deploying transportation technology, and improving truck
routes. The state of New York serves as an example of how public sector
stakeholders have employed this strategy. Incident management programs
are designed to rapidly deploy vehicles that remove accident vehicles
and debris to quickly restore traffic flow after accidents. The New
York State Department of Transportation has implemented this strategy
by dispatching better towing equipment to an accident scene to provide
a faster response to traffic incidents. Transportation technologies are
also used to improve the flow of traffic and better manage the highway
system. The New York State Department of Transportation has invested
hundreds of millions of dollars in equipment that will give motorists
advance information about traffic delays and incidents to better inform
their travel decisions. While incident management programs and
transportation technologies are intended to improve freight and
passenger traffic alike, other initiatives focus specifically on
enhancing freight mobility. Recognizing that New York City is heavily
dependent on trucks for goods movement, the New York City Department of
Transportation initiated the Truck Route Management and Community
Impact Reduction Study. This study revealed several negative effects of
truck traffic on local communities, including traffic congestion,
damage to residences and roads, and safety concerns for pedestrians and
passenger traffic. In response to these findings, the New York City
Department of Transportation has started to implement a number of
solutions to mitigate these negative effects. For example, in some
areas of the city, routing changes were implemented that improved
access into the area by taking truck traffic off of some residential
streets and putting it onto wider streets.[Footnote 35]
As we have reported previously, railroads typically try to improve
their processes before enhancing infrastructure to mitigate
congestion.[Footnote 36] Process improvements and other strategies
generally cost less and are more cost effective than infrastructure
enhancements. Process improvements such as double stacking intermodal
containers on rail cars, where the rail infrastructure allows, or
increasing the number of cars per train enable more freight to move on
rail lines without increasing rail congestion. Other railroad process
improvements have included updating operating plans to reflect changes
in business volume and traffic mix, increasing the number of fully
loaded cars per train, decreasing car cycle times, increasing service,
and hiring more train crews.
Other proposals aimed at increasing overall freight transportation
capacity involve diverting freight traffic from one mode to another,
less congested mode or using technology to improve efficiency. A 1996
DOT study evaluating the status of intermodal freight in the United
States reported that diverting freight traffic away from highways
reduces congestion. The study found that for every ten containers
carried by rail, a minimum of seven trucks are taken off
highways.[Footnote 37] Regions serving as international gateways are
investing in alternative modes for transporting goods short distances,
including short sea shipping and short haul rail, and creating virtual
container yards through the internet that better match empty containers
with freight transportation companies to reduce the number of truck
trips to and from the port area. (See table 4 for examples of proposals
to maximize the use of existing capacity.)
Table 4: Examples of Proposals to Maximize the Use of Existing
Capacity:
Short sea shipping: Short sea shipping encompasses waterborne
transportation of commercial freight between domestic ports through the
use of inland and coastal waterways. Moving freight in this manner
could potentially relieve some highway and rail congestion while
increasing freight mobility.[A] For example, the Port Authority of New
York and New Jersey has proposed to expand the Port Inland Distribution
Network (PIDN) system to include service to water-accessible ports
further north, such as Bridgeport, Conn.; Providence, R.I.; and Boston,
Mass. PIDN is a planned system for distributing containers moving
through the Port of New York and New Jersey by barge and rail.
Short haul rail: Proposals have been advanced by transportation
stakeholders in the New York and New Jersey region to divert truck
traffic to rail for short hauls. Transportation decision makers in New
York suggest that if rail capacity could be expanded to allow for short
hauls from the port to 15-30 miles out, then trucks would not have to
go into the congested urban areas.[B].
Virtual container yards: In 2006, the ports and the Alameda Corridor
Transportation Authority in southern California implemented a virtual
container yard--an internet-based matching service for empty
containers--which reduces the number of empty containers being
transported back to the port after goods have been delivered to a
destination. Instead, containers are delivered to an exporter who needs
empty containers for goods going to the port for shipment overseas.
This reduces truck trips to and from the port area. It has been
estimated that approximately 2 percent of the import containers are
currently taken directly to exporters. The goal of the virtual
container yard is to increase that percentage to at least 10
percent.[C].
Source: GAO.
[A] GAO, Freight Transportation: Short Sea Shipping Option Shows
Importance of Systematic Approach to Public Investment Decisions, GAO-
05-768 (Washington, D.C.: July 29, 2005).
[B] The Port Authority of New York and New Jersey, The Port Authority
Strategic Plan: Transportation for Regional Prosperity (New York, N.Y.,
August 2006).
[C] Southern California Association of Governments, Southern California
Regional Strategy for Goods Movement: A Plan for Action (February 2005,
amended March 2005).
[End of table]
The second strategy--influencing user behavior and managing demand--
typically involves charging fees during peak hours to encourage users
to shift to off-peak periods, use less congested routes, or use
alternative modes, thereby spreading out demand for available
transportation infrastructure. Even though some of these approaches
have been applied only to passenger traffic, the congestion reduction
could benefit freight transportation through those areas. Congestion
pricing strategies include incorporating the use of high-occupancy toll
(HOT) lanes and implementing a cordon pricing scheme in crowded urban
areas. HOT lanes are priced lanes that offer drivers of lower occupancy
vehicles, often people driving alone, the option of paying a toll to
use lanes that are otherwise restricted to vehicles with a greater
number of passengers. HOT lanes are beneficial in that they offer
drivers a choice of paying a charge to reduce their travel time or
continuing to take longer to make their trips on uncharged roadways. In
addition, they can channel traffic into underused lanes and decrease
congestion in non-HOT lanes, thereby increasing the overall throughput
of a corridor. HOT lanes can also shift traffic to less congested times
by charging a lower toll just before and after peak period.[Footnote
38] Cordon pricing is a form of congestion pricing whereby drivers are
charged a fee to enter a certain area during peak hours. Congestion
pricing can be applied to various modes and has the potential to create
other benefits, such as generating revenue to help fund additional
transportation investments. Another approach that has been used to
influence user behavior and manage demand involves working with
businesses to extend their hours to accept deliveries during non-peak
hours. This approach has the potential to reduce peak hour congestion
by giving delivery drivers a wider delivery window and avoiding traffic
delays. In some cases, congestion pricing is also applied in setting
fees that are charged for peak hour transportation and deliveries,
providing an incentive for users to shift deliveries to off-peak
periods. (See table 5 for examples of projects and proposals to
influence user behavior and manage demand.)
Table 5: Examples of Projects and Proposals to Influence User Behavior
and Manage Demand:
Congestion Pricing: HOT lanes. Drivers willing to pay to use the HOT
lanes in California and Texas saved an average of 12-20 minutes per
trip in the peak period.[A] A previous GAO evaluation of the State
Route 91 HOT lane project in Orange County, California, showed that,
although the HOT lanes represent only 33 percent of the capacity of
State Route 91, they carry about 40 percent of the traffic in peak
hours.[B]
Congestion Pricing: Cordon Pricing. New York City has been selected by
DOT as an urban partner to implement a cordon pricing pilot. Pending
state legislative approval, a congestion pricing scheme would be
implemented in Manhattan to encourage more efficient freight deliveries
to retailers. For example, truck drivers would have to pay a $21 fee to
enter the cordon during peak hours but, in turn, would have greater
access to curbside parking and thereby decrease overall trip time. The
pricing plan would also encourage off-hours deliveries.
Freight Transportation Demand Management: Extending business hours.
Some businesses in New York City have opted to extend hours of
operation to reduce peak daytime traffic congestion. As a result, these
businesses receive special incentives from the City to receive
deliveries late in the day. For instance, some retail stores have
arranged to have employees stay late to receive deliveries after 9:00
p.m. The City, in turn, has provided special approval of curbside
parking to these businesses and has agreed not to ticket delivery
vehicles during off-peak hours. In addition, City officials are
considering expanding the hours that curbside space is available to
delivery vehicles (typically 4-7 p.m.)
Freight Transportation Demand Management: PierPass. The PierPass
program in southern California was created to alleviate port congestion
at the ports of Los Angeles and Long Beach. In an effort to encourage
cargo owners to arrange transport during nights and weekends, the
program imposes a $50 per twenty-foot equivalent unit Traffic
Mitigation Fee on loaded containers that are moved during peak hours.
According to a PierPass official, the program has resulted in
approximately 36 percent of traffic moving at night, taking thousands
of truck trips out of daytime freeway traffic patterns, thus
alleviating daytime congestion.
Source: GAO.
[A] GAO, Reducing Congestion: Congestion Pricing Has Promise for
Improving Use of Transportation Infrastructure, GAO-03-735T
(Washington, D.C.: May 6, 2003).
[B] GAO-07-920.
[End of table]
The Current State and Local Transportation Decision-Making Structure
Impedes the Advancement of Freight Capacity-Enhancing Solutions:
Although stakeholders have advanced a variety of approaches to improve
freight mobility, state and local public planners face three broad
challenges when attempting to advance freight projects. First, public
planners face challenges in advancing freight projects within a public
transportation planning process that is not well suited to the
identification and advancement of freight projects. Second, public
planners face challenges reaching agreement among the various freight
stakeholders on freight needs and solutions. Finally, due to the modal
structure of transportation funding, public planners face challenges in
accessing funding, even when freight projects merit public sector
involvement.
Challenges Associated with Advancing Freight Projects within the
Planning Process:
Within the state and local transportation planning process, freight
projects often have difficulty competing with other transportation
projects, such as passenger related projects, for limited public funds
and community support. Although the public transportation planning
process includes freight transportation improvements, in practice,
freight projects have difficulty competing with other projects because
(1) public planners, as well as the communities they represent, tend to
favor projects that produce more apparent local public benefits, such
as passenger-oriented projects, rather than projects that are seen as
providing direct benefits to private companies or yield benefits to
other jurisdictions; (2) public planners often lack the tools and data
to evaluate freight projects, putting those projects at a disadvantage
when compared with other transportation projects; and (3) in the
absence of proper evaluation to quantify potential costs and benefits
of a project, public planners are not able to articulate the merits and
costs of freight improvements, which could hinder the advancement of
some freight projects where there are community-based concerns about
air pollution and public health effects, for example.
First, within the public transportation planning process, freight
projects have difficulty competing with nonfreight projects for limited
public funds because public planners are more likely to focus on
projects that clearly produce local public benefits, such as projects
that improve passenger mobility. Although freight improvements may also
produce public benefits, the benefits are not always immediately
obvious to the public. For example, a project that adds lanes to a
crowded freeway is likely to benefit both passengers and freight
haulers, while a road that enhances freight access to a port facility
would likely be perceived as having only limited public benefit, even
though it could improve freight mobility, and therefore, ease
congestion for passenger vehicles. Public planners are wary of spending
public funds on improvements to privately-owned freight infrastructure,
such as the freight rail network. These types of projects have
difficulty competing with other transportation projects in the public
planning process because of the direct benefits that such improvements
provide to private companies. Because the private railroad companies
lack incentives for investing in projects that yield primarily public
benefits and the public sector is wary of providing support when
private benefits are apparent, some freight rail projects that produce
public benefits may be disregarded. For example, some of the freight
stakeholders with whom we spoke said that freight rail improvements are
often overlooked when competing against commuter rail projects. One
stakeholder stated that many of the rail corridors in the New York City
area are owned by public agencies and are dominated by passenger
traffic, putting freight rail traffic at a disadvantage.
The public planning processes also focus on projects that produce local
public benefits, whereas freight improvements can produce benefits
beyond local jurisdictions. In general, many decisions in the
transportation planning process are left to state DOTs and regional
MPOs, which operate within defined jurisdictions. Although state DOTs
work to address freight mobility challenges on a statewide basis, many
freight transportation corridors cross state boundaries, and unless
states are part of a multistate coalition, they usually do not address
projects that involve these corridors. Rather, public planners tend to
focus on the transportation needs that will directly benefit their
constituencies, which can result in significant national freight needs
going unaddressed. Stakeholders we spoke with in the four areas we
visited confirmed that it is difficult to expend public funds on
projects that clearly benefit other jurisdictions. For example, in
Houston, public officials who oversee multiple jurisdictions said that
local governments tend to give higher priority to their own favored
projects and it can be difficult to get local governments to adopt a
system wide perspective.
A second challenge state and local planners face in securing public
support for freight improvements is that tools to evaluate freight
projects are often lacking. FHWA and TRB have noted that, in making
freight-related investment decisions, public planners are not applying
appropriate evaluation elements, such as criteria by which to choose
freight projects versus alternative projects, impeding the progress of
freight-related projects.[Footnote 39] In our past work, we noted that
state and local planners have not developed the tools to evaluate
freight projects with nonfreight projects.[Footnote 40] Without tools
to quantify the costs and benefits of various proposals, public
planners may find it difficult to determine the extent to which public
investment is required and to understand the trade-offs and
relationships between alternative solutions involving different
transportation modes. Moreover, in the absence of proper evaluation,
public planners are unable to adequately judge the relative merits of
freight improvement proposals, as opposed to passenger projects.
In addition to the lack of planning tools, the data necessary to
conduct proper evaluations and make sound decisions are often lacking.
TRB and FHWA studies have identified two possible explanations for the
difficulty in acquiring freight data.[Footnote 41] First, state and
local planners are unable to obtain the data needed to sufficiently
evaluate freight infrastructure proposals because public agencies may
not have the necessary staff or resources to collect the data. Second,
freight data on smaller geographical areas, which are necessary for
effective freight planning, are not available, and as a result, some
state and local agencies find it necessary to obtain data from costly
private sources. Moreover, some companies that have data on private
freight movement consider the information to be proprietary and are
unwilling to share these data with public agencies.[Footnote 42] For
example, in Houston, a consortium of four local transportation agencies
collects and provides information on the Houston area's major roadway
system, including interstates, toll roads, and some highways. While the
consortium has the capability to extend its tag-reading technology to
track overall freight rail traffic, the railroads do not allow this
practice because they consider that information proprietary. However,
such data can often be used to identify heavily traveled highways and
intersections and possible measures to mitigate intermodal freight
bottlenecks. The lack of complete freight data necessary for freight
improvement projects to compete with other transportation projects was
also apparent in Atlanta, where a public planner told us that there are
plenty of passenger data available to make sound investment decisions,
but this same kind of data are missing for freight traffic.
Third, public planners also face challenges in advancing freight
projects when affected communities oppose the advancement of certain
projects. The public planning process requires transportation agencies
to provide the public with meaningful opportunities to provide input on
transportation decisions, and planners are expected to consider the
full range of financial, social, economic, and environmental
consequences of all proposed transportation projects. However, without
the tools and data to adequately evaluate proposals, public planners
are not able to articulate the merits and costs of freight
improvements, which could hinder the advancement of some freight
projects. Community resistance to freight improvements was evident in
all of the locations that we visited, but was most apparent in
California where community-based concerns about air pollution and
public health effects were raised in opposition to projects for
expanding freight transportation capacity. Many local communities
directly affected by freight transportation have opposed new freight
projects citing environmental and health hazards that these projects
might produce. However, freight improvements may be able to address
some of these concerns by reducing congestion or unblocking a
bottleneck. In the absence of proper evaluation to quantify the
potential costs and benefits of a project, affected communities may
continue to oppose the advancement of freight improvements.
Coordinating Among Multiple Public and Private Stakeholders Presents
Challenges to Implementing Freight Proposals:
When freight proposals are advanced in the public planning process,
planners are faced with the challenge of coordinating among various
public and private stakeholders. To elevate freight improvements in the
public planning process, planners must take into consideration the
views of local elected officials, public agencies involved in
transportation planning, and the private sector, including rail and
trucking companies. Agreement among all parties is often desired before
a project can be advanced.
Obtaining cooperation among numerous public sector transportation
stakeholders on freight proposals that extend across multiple
jurisdictions is difficult and can deter advancing freight projects
that cross jurisdictional boundaries. The public planning process
involves public agencies that vary in terms of mandates from their
constituencies, geographical and jurisdictional responsibilities,
funding capacities, and staff resources. Given these factors, each
agency often develops its own mission, agenda, studies, and processes;
also, its decisions will often reflect political, as well as
transportation, concerns. Given the unique characteristics of each
agency, obtaining cooperation among these different officials can make
the planning and implementation of multistate and multiregion freight
projects difficult, as the following examples describe:
* In southern California, a number of public entities play a role in
setting freight transportation priorities--4 district offices of the
California DOT, 14 subregions, 6 county transportation commissions, and
184 city governments. Prior to the last California state transportation
bill, the Alameda Corridor Transportation Authority (ACTA) developed a
project list that they believed represented the projects that were in
the best interest of southern California as a whole.[Footnote 43] The
Los Angeles Metropolitan Transportation Authority disagreed with their
list and proposed a different set of projects and priorities, creating
competition--instead of cooperation--for the limited funds available.
* Public planners we spoke with in New York State explained that
planning freight projects in the New York and New Jersey region is
particularly challenging to manage because of multiple agencies in each
state, as well as each state's separate government. For example,
completion of the Staten Island lift bridge, a railroad project to
connect Staten Island with the national freight rail network, was
especially challenging because it required the approval of 26 federal,
state, and local planning bodies.
* Officials in Atlanta said that Georgia, along with four other states,
submitted an application for proposed improvements to Interstate 95
through DOT's Corridors of the Future program. A public planner that we
spoke with said coming to a consensus on the proposed improvements was
difficult because each state had competing demands. For example, one
state wanted truck-only lanes, while another state wanted to increase
the number of lanes for all vehicles.
While reaching agreement among public sector entities about freight
projects can be very challenging, securing the participation and
support of the private sector can also be difficult. Private entities-
-mainly manufacturers, railroads, trucking companies, marine terminal
operators, overseas shipping lines, logistics providers, wholesale
distribution centers, and retailers--can provide meaningful input in
freight transportation planning. According to FHWA, private sector
participation can help local planners identify and address needed
freight transportation improvements and provide expertise and data to
make informed decisions.[Footnote 44] However, obtaining private sector
participation in the public sector transportation planning process has
been difficult, due to the lengthy public planning process. Many
transportation planning agencies have planning horizons that extend
over long periods compared to the private sector and are required to
develop and update a long-range transportation plan covering a planning
horizon of at least twenty years. This long time period is necessary
for the public sector to complete impact studies and to obtain
necessary funding, but may result in the private sector losing interest
or becoming frustrated with the process. For example, the Atlanta
Regional Commission's Freight Advisory Task Force includes public and
private sector freight representatives who inform the regional planning
process on freight issues. However, some private sector freight
stakeholders with whom we spoke in the Atlanta area expressed
frustration that, while there has been much discussion of freight
issues affecting private companies, the public sector has yet to
implement any change.
Even if public planners are successful in securing private sector
participation in the planning process, getting them to support and help
fund freight projects may be hindered by the lack of sufficient
benefits for the private sector. In prior reports, we found that
limited participation by the private sector stems from the fact that
freight projects proposed through the transportation planning process
do not offer sufficient benefits to warrant their involvement.[Footnote
45] For example, the railroads that serve the west coast have been
reluctant to support the Alameda Corridor East project, which connects
the Alameda Corridor and the Ports of Los Angeles and Long Beach to the
transcontinental rail network. According to public planners, although
the project would yield substantial public benefits, such as safety and
reduced pollution, it would do little to help the railroads in terms of
increasing capacity.[Footnote 46] In another case, an official from a
Class I railroad operating in the southwest said that company officials
were wary of the Texas DOT's freight rail plan for Houston because the
agency had not met with railroad officials during the planning process
to discuss the private benefits that would accrue to the railroad from
projects that were in the plan. Railroad officials said that it seemed
as though Texas DOT attributed more private benefits to those projects
than would actually accrue and that Texas DOT would want higher
contributions from the railroad than the railroad would be willing to
pay toward those projects.
Funding for Freight-Specific Projects is Difficult to Secure:
When freight improvements have been identified within the public
planning process, public planners face a number of challenges in
securing funds to advance those improvements. The limited federal,
state, and local funding available for freight improvements and
restrictions built into existing programs; the modal stovepiping of
funding programs; and the complexity of funding multimodal,
multijurisdictional projects all contribute to the difficulty of
advancing freight improvements.
The limited availability of funding sources specifically targeted to
freight projects was cited as a challenge by freight stakeholders in
each of our four case study regions. Only one federal program--the
Freight Intermodal Distribution Pilot Grant Program--offers federal
funding specifically for intermodal freight projects. Congress has
authorized $30 million for projects in five states through this pilot
program. Other federal programs, such as Projects of National and
Regional Significance and National Corridor Infrastructure Improvement
Program, can also provide funding for intermodal freight projects.
However, some funding for all of these programs has been
congressionally directed to specific projects. According to a recent
DOT Inspector General report and a prior GAO report, the congressional
direction of funds for particular projects may not result in the
highest priority projects being funded.[Footnote 47] For example, a
public planner with whom we spoke in New York City said that, although
federal money in the form of congressional directives were given to New
York City, the funds were directed at projects that were not included
in any city plans. In addition, freight-specific funding sources are
also lacking at the state and local levels. For example, according to
local transportation officials with whom we spoke in southern
California, an estimated $26.2 billion will be needed for regional
infrastructure enhancements to promote efficient goods movement.
Although a $20 billion bond measure to fund transportation projects was
recently passed in the state, only $2 billion has been set aside for
freight-specific projects throughout the state. In Houston, a freight
stakeholder said that Houston area public planners cannot rely on Texas
DOT to provide a share of state funds needed for local interstate,
highway, and freight projects. Area governments have, therefore,
pursued several alternative means of funding projects, including toll
roads and a freight rail district.[Footnote 48]
Aside from the lack of freight-specific federal programs dedicated to
improvements, freight projects can be especially difficult to fund or
finance because of restrictions built into existing federal programs.
Rail projects, in particular, are difficult to fund even when
considered a priority in the public planning process because rail
infrastructure is privately owned. Although two federal credit
programs--the Transportation Infrastructure Finance and Innovation Act
of 1998 (TIFIA) and the Railroad Rehabilitation and Improvement
Financing (RRIF)--can be used to finance freight rail projects, these
programs have eligibility criteria that may limit some projects. For
example, to qualify for TIFIA assistance, the project must generate a
revenue stream from user charges or other nonfederal funding sources.
The RRIF program includes an up-front fee applicants must pay in order
to receive the loan, and applications must be approved by both the
Federal Railroad Administration and the Office of Management and
Budget.[Footnote 49] According to one short line railroad
representative with whom we met, the program only benefits those
companies that can generate enough money to pay back the loan principal
and interest. In other cases, freight projects can be difficult to fund
because only specific types of projects are eligible for program funds,
such as with the Congestion Mitigation and Air Quality (CMAQ) program.
In the case of CMAQ, unless a project has a positive effect on air
quality in certain nonattainment or maintenance areas, it would not be
eligible for CMAQ funds.
The modal structure of funding programs and of public transportation
bodies also affects the funding of intermodal freight improvement
projects. Reflecting the separate federal transportation funding
programs, many state and local DOTs are generally organized into
several operating administrations with responsibilities for particular
modes. According to our previous work and other published studies, this
modal focus can impede the funding of freight projects, which tend to
be intermodal in nature.[Footnote 50] Because different operating
administrations oversee and manage separate funding programs, these
programs often have differing timelines, criteria, and matching fund
requirements, which can make it difficult for public planners to plan
and implement these intermodal freight projects. Moreover, because
federal programs are often structured such that they dedicate funds on
a modal basis, state and local decision makers may choose projects
based on the mode eligible for federal funding, which puts freight
projects at a disadvantage.[Footnote 51] For example, a traditional
project, such as a project to widen a highway, typically involves only
one mode. The planning and development of this type of project involves
a single sponsor (such as a local transportation agency) and one
clearly defined funding source (such as the federal-aid highway
program). In contrast, freight improvement projects tend to be more
complicated because they are frequently intermodal (such as a rail-to-
truck transfer site), which means that a clear sponsor for the project
may not exist, discussions among multiple sponsors are usually
required, and consideration of multiple funding sources may be
necessary. A public planner in Atlanta said that modal stovepiping of
funds presents challenges for public transportation planners when
attempting to make improvements on nonhighway modes, as well as on
infrastructure that has a private component.
Finally, public planners are often faced with the challenge of funding
freight improvements that reap national benefits. As noted earlier, the
public transportation planning process leaves infrastructure
improvement decisions to state and local planning bodies without
considering the national or global nature of freight transportation.
Although freight transportation is international and national in
nature, state and local planners control the planning and project
identification process for improvements to enhance freight mobility.
Since these local communities have limited funds for transportation
projects and federal funding sources are limited, projects that provide
benefits that are more readily discernible to immediate localities--
such as highway projects that address passenger transportation--are
often given priority for funding. For example, a public planning
official in Atlanta noted that 36 percent of the freight tonnage and 46
percent of the value of freight traveling on Georgia's transportation
system has neither an origin nor a destination in the state. Public
officials in Atlanta told us that it is difficult for Atlanta and
Georgia to pay the high costs of improving the freight transportation
system when much of the freight is not benefiting Atlanta or the state
of Georgia. In addition, according to a paper released by the Southern
California Association of Governments, while the ports of Los Angeles
and Long Beach handle one-third of all waterborne freight container
traffic entering the United States, the region is not compensated for
the public or external costs associated with moving this freight, such
as traffic congestion, air pollution, noise, public health effects,
visual blight, and freight-related safety incidents.[Footnote 52] In
the absence of a national strategy and nationally established criteria
by which to choose critical freight projects, public officials at the
state and local levels will continue to invest federal funding on
projects that most benefit their constituencies.
Federal Government Faces Challenges in Resolving Freight Mobility
Issues:
The ability of the federal government to help address freight mobility
issues is constrained for several reasons. First, as we have previously
reported, there is no strategy or clearly defined federal role in
transportation generally and in freight transportation specifically,
despite a clear federal interest in freight transportation stemming
from Congress' constitutional role to regulate interstate commerce and
freight transportation's effect on the national economy. While DOT's
Draft Framework for a National Freight Policy takes a step forward in
developing a national freight transportation policy, we have found that
it does not comprehensively guide the implementation of a federal role
in freight transportation investments. It assumes a federal role
without indicating whether federal involvement is appropriate or, when
appropriate, what the goals of federal involvement should be, what
specific roles the federal government and other stakeholders should
play, and what federal revenue sources and funding mechanisms should be
used to support freight-related investments.[Footnote 53] Without a
clearly defined federal role in the planning and funding structure,
federal officials are limited in their ability to promote broad,
regional solutions to freight mobility that transcend state and local
jurisdictions to yield national benefits. Additionally, until the
federal role is more clearly defined, the current system, in which an
average of over $38 billion per year in federal gas tax
revenues[Footnote 54] are allocated to states by formula, will likely
continue. As we have found previously, most federal highway grant funds
are apportioned to state and local governments by formula, without
regard to the needs, performance, capacity, or level of effort of
recipients and with no assurance that they are dedicated to projects
that best meet mobility needs of either freight or passengers.[Footnote
55]
Another factor constraining the federal government from helping address
freight mobility issues is that the government is still trying to do
business in ways that are based on conditions, priorities, and
approaches that were established decades ago and are not well suited to
addressing 21st century challenges. For example, the current federal
transportation structure is stovepiped around individual modes with
their individual funding sources, leaving little room for flexibility
in a transportation network in which many modes work together to
provide for freight transportation.
Finally, federal action is constrained because the main transportation
funding mechanism--the Highway Trust Fund--is at risk at a time when
the federal government faces a long-term fiscal imbalance that
threatens the financial viability of the government. Although, as we
have previously reported, private entities, such as railroads, are
investing in their own transportation infrastructure,[Footnote 56] the
federal government faces serious challenges to its ability to invest in
transportation. In terms of the Highway Trust Fund, the Office of
Management and Budget has stated that absent any changes, the Highway
Trust Fund will reach an estimated $4 billion negative balance by
fiscal year 2009,[Footnote 57] seriously limiting the amount of federal
resources to invest in the nation's infrastructure. With regard to the
governmentwide fiscal imbalance, unless changes are made, balancing the
federal budget by 2040 could require actions as large as cutting all
federal expenditures by 6 percent or raising federal taxes to twice
today's level.[Footnote 58]
These challenges--the lack of a clearly defined strategy and role, an
outdated modal-focused structure, and the current transportation
funding shortfall combined with an unsustainable federal fiscal
situation--not only hinder the ability of the federal government to
help address freight mobility challenges, but also contribute to the
broader transportation challenges facing federal decision makers at all
levels. Any efforts to address these freight mobility challenges must
be done in the context of broader transportation challenges facing the
nation. Table 6 summarizes the key transportation challenges and
considerations that have been raised in our prior work.
Table 6: Key Transportation Challenges and Considerations Facing
Federal Decision Makers:
Key challenges: Focusing federal transportation policy;
Considerations: Define national transportation goals with targeted
areas or corridors of national interest and a clear federal role in
achieving those goals in those areas and corridors.
Key challenges: Creating performance criteria for federal
transportation investments;
Considerations: Establish criteria to ensure federal funds invested
achieve the highest national public benefits.
Key challenges: Aligning roles of state, local, and private
stakeholders;
Considerations: Create partnerships that maintain a level of effort by
other transportation stakeholders that aligns their costs and
contributions with their respective benefits.
Key challenges: Reestablishing user based financing for transportation
programs;
Considerations: Ensure revenue sources take into account all economic
and social costs of each mode.
Key challenges: Ensuring federal funding sources can meet future
national transportation demands;
Considerations: Reduce modal stovepipes for federal funding; allow for
more multimodal flexibility in federal investments; increase
sustainability by increasing capability to adjust to reductions in
demand or consumption.
Sources: GAO-05-325SP, GAO-07-310, GAO-07-770, GAO-07-1210SP.
[End of table]
We have previously reported that these challenges and considerations
highlight the need for the federal government to reassess the
appropriate federal role and strategy in funding, selecting, and
evaluating transportation investments, including those for freight
transportation.[Footnote 59] Conducting this type of reassessment could
better position the federal government to work with state and local
decision makers to address the challenges to freight mobility and lead
to a more efficient transportation system. We have also reported that
critical factors and questions can be used as criteria for determining
the appropriateness of a federal role and a framework with components
that we believe would be helpful in guiding future federal freight
transportation investments. Implementing this framework would include
setting national goals for federal investment in freight-related
infrastructure, clearly defining federal and other stakeholder roles,
and identifying sustainable revenue sources and cost-effective funding
mechanisms that can be applied in order to maximize the national public
benefits of federal investments. (See app. II for critical factors and
questions as well as components of GAO's framework.)
Conclusions:
The nation is at a crossroads regarding the future of the freight
transportation system. The current federal role in surface
transportation is unclear and unfocused, and the federal government
does not maximize opportunities to promote the efficient movement of
freight. Federal surface transportation programs also lack assurance
that the federal transportation funds granted annually to states are
being dedicated to projects that best meet the mobility needs of either
freight or passengers. This structure functions as an impediment to
meeting freight mobility challenges. Solutions to these challenges
require strategic, multimodal, and economically sound strategies that
local, state, and regional governments and planning organizations are
fundamentally limited in addressing. Moreover, finding solutions to
these challenges by reframing and focusing the federal role in freight
transportation is complicated by the increasingly unsustainable federal
fiscal condition that makes it imperative to maximize the national
public benefits of any federal investments.
DOT and Congress, which have important oversight roles in regulating
interstate commerce, should both play key roles in bringing about
needed changes to address the challenges we have identified in order to
increase the efficiency and capacity of the nation's freight
transportation system. Given the clear interstate and international
character of many freight challenges, the federal government has a
distinct and important role in bringing a national scope and vision to
the problems that now face localities, states, and regions that have
national freight flows. By promoting and coordinating solutions across
jurisdictional lines, the federal government could increase the
effectiveness of localities, states, and regional governments and
planning organizations in overcoming their freight-related challenges.
The federal government could also more effectively direct national
resources towards those freight investments and solutions that have
nationwide influence.
While DOT has made some progress in enhancing the nation's freight
transportation system through its Draft Framework and the Corridors of
the Future program, more fundamental changes will be required to
address challenges and meet anticipated freight flows. In developing
and implementing ways to address freight transportation needs, Congress
and DOT face a challenging and complex job. There is no quick and easy
solution for addressing the freight transportation challenges; rather,
a fundamental reassessment of the federal role in addressing the
nation's freight transportation challenges as part of a larger
reexamination of national transportation programs is needed. Essential
to this reexamination is developing a federal strategy to achieve
national freight policies that both embodies basic economic and
management principles; provides a base from which to determine an
appropriate federal role in funding, selecting, and evaluating freight
transportation investments; and seeking and allocating alternative
sources of revenues.
DOT must begin to work in earnest with the Congress in formulating
these fundamental changes because, ultimately, Congress will have to
make difficult choices--especially in finding funding solutions--that
may please some stakeholders, but will likely generate opposition by
sectors or regions who anticipate being disadvantaged. As the projected
revenue shortfall in the Highway Trust Fund rapidly approaches and as
freight congestion increases, time to forge a meaningful freight
strategy and policy is running out.
Recommendation for Executive Action:
In order to improve freight mobility by more clearly defining the
federal role in the freight transportation network and to begin to
align federal investments with economically significant national
benefits, we recommend that the Secretary of Transportation develop
with Congress and public and private sector stakeholders a
comprehensive national strategy for freight transportation. This
national strategy should include:
* defining the federal role and national interests in freight
transportation, including economically-based and objective criteria to
identify areas of national significance for freight transportation and
to determine whether federal funds are required in those areas;
* establishing the roles of regional, state, and local governments, as
well as the private sector; and:
* using new or existing federal funding sources and mechanisms to
support a targeted, cost-effective, and sustainable federal role in
freight transportation.
Agency Comments:
We provided a draft of this report to DOT for review and comment prior
to finalizing the report. DOT officials generally agreed with the
information in this report, and they provided technical clarifications,
which we have incorporated into this report, as appropriate. DOT did
not comment on the recommendation.
We are sending copies of this report to congressional committees with
responsibilities for transportation issues and the Secretary of
Transportation. We will also make copies available to others upon
request. In addition, this report will be available at no charge on the
GAO Web site at [hyperlink, http://www.gao.gov].
If you or your staff have any questions about this report, please
contact me at (202) 512-2834 or heckerj@gao.gov. Contact points for our
Offices of Congressional Relations and Public Affairs may be found on
the last page of this report. GAO staff who made key contributions to
this report are listed in appendix III.
Sincerely yours,
Singed by:
JayEtta Z. Hecker:
Director, Physical Infrastructure Issues:
[End of section]
Appendix I: Objectives, Scope, and Methodology:
The objectives of this report were to examine (1) factors that
contribute to constrained freight mobility in areas with nationally
significant freight flows and the effects of this constrained mobility
and (2) approaches that are being used to address impediments to
freight mobility in selected regions with nationally significant
freight flows and the challenges that freight transportation
stakeholders face in implementing solutions. For this report, we
considered areas with nationally significant freight flows to be those
that are either a major seaport, international border, freight
distribution hub, or areas that combine some or all of these
characteristics.[Footnote 60] We also primarily focused on overland
surface transportation from ports to markets and on intermodal freight,
as these demonstrate freight movement between modes and across multiple
jurisdictional lines. To address these objectives, we conducted a
literature review and completed four case studies in regions with
nationally significant freight flows.
Our literature review included Transportation Research Board
publications, U.S. Department of Transportation (DOT) studies, academic
studies, and consulting firm reports. Using these sources, we analyzed
the content to categorize freight mobility issues related to our
objectives. Though we did not independently verify the accuracy of the
analyses and data presented in the literature, the result of this
limitation is minimal because we relied on a broad array of literature
to generally describe the key factors that cause impediments to freight
mobility and their associated effects, as well as the approaches that
are being used to enhance freight mobility and challenges associated
with advancing solutions.
We also completed four case studies to illustrate the range and
complexity of the factors that constrain freight mobility and their
effects, in addition to the approaches and associated challenges, used
by stakeholders to implement solutions to these challenges. To select
regions with nationally significant freight flows for our case study
analyses, we relied on information available from the Federal Highway
Administration's (FHWA) Freight Analytic Framework database regarding
freight volumes and values and used that information to judgmentally
select at least one seaport, land border, and major distribution
center. Finally, we chose sites that provided geographic diversity. At
each of these locations, we conducted multiple interviews with a wide
variety of public and private sector freight transportation
stakeholders. However, the results of our case study analyses are not
generalizable because the locations selected are not necessarily
representative of other types of international gateways and
distribution hubs.
The four case study regions were: New York and New Jersey, Atlanta,
Houston and Laredo, and Los Angeles and Long Beach. To understand the
dynamics of freight movement in case study regions, approaches used in
freight planning and operations, and what transportation stakeholders
are doing in response to challenges faced in implementing freight
projects, we conducted interviews with public and private freight
transportation stakeholders in these areas. In addition to our site
visits, we interviewed other stakeholders in the national freight
transportation network. We also analyzed documents provided to us by
the stakeholders pertaining to their transportation planning efforts.
For a complete list of all entities interviewed, see table 7.
Table 7: Names and Locations of Organizations Contacted:
Name: Class I freight railroads: Burlington Northern Santa Fe;
Location: Los Angeles, Calif.
Name: Class I freight railroads: CSX Transportation;
Location: Newark, N.J.
Name: Class I freight railroads: Kansas City Southern;
Location: Laredo, Tex.
Name: Class I freight railroads: Norfolk Southern;
Location: Atlanta, Ga.
Name: Class I freight railroads: Union Pacific Railroad Company;
Location: Houston, Texas, Washington, D.C.
Name: Class III freight railroads: New York & Atlantic;
Location: New York, N.Y.
Name: Federal agencies: U.S. Army Corps of Engineers;
Location: Houston, Texas, Washington, D.C.
Name: Federal agencies: U.S. DOT; Office of Intermodalism;
Location: Washington, D.C.;
Name: Federal agencies: U.S. DOT; Federal Railroad Administration;
Location: Washington, D.C.;
Name: Federal agencies: U.S. DOT; Offices of Freight Operations and
Policy;
Location: Washington, D.C.;
Name: Federal agencies: U.S. DOT; Maritime Administration;
Location: Los Angeles, Calif.
Name: Federal agencies: U.S. Department of Homeland Security;
Location: Laredo, Texas.
Name: Federal agencies: U.S. Department of Homeland Security; Customs
and Border Protection;
Location: San Diego, Calif.; Washington, D.C.
Name: State agencies: California DOT;
Location: Los Angeles, Calif.
Name: State agencies: Georgia DOT;
Location: Atlanta, Ga.
Name: State agencies: New Jersey DOT;
Location: Newark, N.J.
Name: State agencies: New York DOT;
Location: New York, N.Y.
Name: State agencies: Texas DOT;
Location: Houston, Texas, Laredo, Texas.
Name: Local organizations and authorities: Alameda Corridor East
Construction Authority;
Location: Irwindale, Calif.
Name: Local organizations and authorities: Alameda Corridor
Transportation Authority;
Location: Carson, Calif.
Name: Local organizations and authorities: Atlanta Chamber of Commerce;
Location: Atlanta, Ga.
Name: Local organizations and authorities: Atlanta Regional Commission;
Location: Atlanta, Ga.
Name: Local organizations and authorities: Bi-State Motor Carriers
Association;
Location: Newark, N.J.
Name: Local organizations and authorities: Georgia Motor Trucking
Association;
Location: Atlanta, Ga.
Name: Local organizations and authorities: Georgia State Road and
Tollway Authority;
Location: Atlanta, Ga.
Name: Local organizations and authorities: Greater Houston Partnership;
Location: Houston, Tex.
Name: Local organizations and authorities: Gulf Intracoastal Canal
Association;
Location: Houston, Tex.
Name: Local organizations and authorities: Houston-Galveston Area
Council;
Location: Houston, Tex.
Name: Local organizations and authorities: Houston TranStar;
Location: Houston, Tex.
Name: Local organizations and authorities: International Longshoremen's
Association;
Location: New York, N.Y.
Name: Local organizations and authorities: International Longshore and
Warehouse Union;
Location: Los Angeles, Calif.
Name: Local organizations and authorities: Laredo Metropolitan Planning
Organization;
Location: Laredo, Tex.
Name: Local organizations and authorities: Laredo Truckers Association;
Location:
Laredo, Tex.
Name: Local organizations and authorities: Los Angeles Chamber of
Commerce;
Location: Los Angeles, Calif.
Name: Local organizations and authorities: Los Angeles Economic
Development Corporation;
Location: Los Angeles, Calif.
Name: Local organizations and authorities: Nation's Port;
Location: Newark, N.J.
Name: Local organizations and authorities: Natural Resources Defense
Council; Location:
Los Angeles, Calif.
Name: Local organizations and authorities: New Jersey Shortline
Railroad Association;
Location: Newark, N.J.
Name: Local organizations and authorities: New York City DOT;
Location: New York, N.Y.
Name: Local organizations and authorities: New York City Economic
Development Corporation;
Location: New York, N.Y.
Name: Local organizations and authorities: New York Metropolitan
Transportation Council;
Location: New York, N.Y.
Name: Local organizations and authorities: New York/New Jersey Freight
Forwarders Association;
Location: Newark, N.J.
Name: Local organizations and authorities: North Jersey Transportation
Planning Authority;
Location: Newark, N.J.
Name: Local organizations and authorities: PierPass;
Location: Long Beach, Calif.
Name: Local organizations and authorities: Port Authority New York New
Jersey;
Location: New York, N.Y.
Name: Local organizations and authorities: Port of Houston Authority;
Location: Houston, Tex.
Name: Local organizations and authorities: Port of Los Angeles and Long
Beach;
Location: Los Angeles, Calif.
Name: Local organizations and authorities: Port Terminal Railroad
Association;
Location: Houston, Tex.
Name: Local organizations and authorities: San Diego Regional Planning
Agency; Location: San Diego, Calif.
Name: Local organizations and authorities: Southern California
Association of Governments;
Location: Los Angeles, Calif.
Name: Local organizations and authorities: Triangle Network Trucking
Association;
Location: Newark, N.J.
Name: Private transportation companies: ABF Freight Systems;
Location: Atlanta, Ga.
Name: Private transportation companies: APL Limited Eagle Marine
Services Ltd.;
Location: Terminal Island, Calif.
Name: Private transportation companies: APM Terminals/Maersk Shipping;
Location: Terminal Island, Calif.
Name: Private transportation companies: Cal Cartage (drayage services);
Location: Los Angeles, Calif.
Name: Private transportation companies: Cal State Xpress (drayage
services);
Location: South Gate, Calif.
Name: Private transportation companies: Coca-Cola Enterprises;
Location: Atlanta, Ga., Elmsford, N.Y.
Name: Private transportation companies: Exxon Mobil Chemical Company;
Location: Houston, Tex.
Name: Private transportation companies: Genesis Intermodal Delivery &
Nordic Logistics;
Location: Houston, Tex.
Name: Private transportation companies: Kinder Morgan Terminals;
Location: Houston, Tex.
Name: Private transportation companies: Lyondell Chemical Company;
Location: Houston, Tex.
Name: Private transportation companies: Maher Terminals;
Location: Newark, N.J.
Name: Private transportation companies: Marine Terminals Corporation;
Location: Los Angeles, Calif.
Name: Private transportation companies: Mattel;
Location: Los Angeles, Calif.
Name: Private transportation companies: Modalgistics;
Location: Atlanta, Ga.
Name: Private transportation companies: New York Container Terminal;
Location: New York, N.Y.
Name: Private transportation companies: Pacific Harbor Line;
Location: Wilmington, Calif.
Name: Private transportation companies: Pacific Maritime Association;
Location: Long Beach, Calif.
Name: Private transportation companies: Pacific Merchant Shipping
Association;
Location: San Diego, Calif.
Name: Private transportation companies: Seaside Transportation
Services;
Location: Terminal Island, Calif.
Name: Private transportation companies: Southern Counties Express;
Location: Rancho Dominguez, Calif.
Name: Private transportation companies: United Parcel Service;
Location: New York, NY, Washington, D.C.
Name: Private transportation companies: Werner Enterprises;
Location: Laredo, Tex.
Name: Academic institutions and consultants: American Transportation
Research Institute;
Location: Smyrna, Ga.
Name: Academic institutions and consultants: Mike Meyer, Professor
Civil and Environmental Engineering, Georgia Institute of Technology;
Location: Atlanta, Ga.
Name: Academic institutions and consultants: George R. Fetty,
Principal, George R. Fetty and Associates, Inc. (Rail Consultant);
Location: Los Angeles, Calif.
Name: Academic institutions and consultants: METRANS Transportation
Center/Center for International Trade and Transportation;
Location: Long Beach, Calif.
Name: Academic institutions and consultants: Leigh Boske, Associate
Dean and Professor of Economics, LBJ School of Public Affairs, The
University of Texas at Austin;
Location: Austin, Tex.
Name: Academic institutions and consultants: Texas Transportation
Institute;
Location: College Station, Tex.
Source: GAO.
[End of table]
To identify the factors that constrain freight mobility and the impacts
of this immobility, we reviewed and analyzed the content of relevant
literature. Our analysis categorized the factors and effects found in
the literature in order to identify the major areas of agreement among
experts regarding the factors that cause, and the effects of,
constraints on the mobility of nationally significant freight flows. We
supplemented our analysis of this literature by interviewing key
freight transportation stakeholders in four regions with nationally
significant freight flows.
To identify approaches that have been proposed or implemented by
transportation stakeholders and challenges associated with advancing
solutions, we interviewed officials in the four case study regions, as
well as DOT officials in Washington, D.C., and collected documents from
these officials about their efforts to implement freight mobility
solutions. This information covered topics such as the planning
process, both at the state and local levels; each organization's role,
including the extent to which each organization provides funding for
freight projects; private sector participation, including the extent to
which private sector stakeholders contribute to funding freight
projects; and perspectives regarding collaboration between public and
private sector stakeholders. In addition, we identified approaches that
can be used to enhance freight mobility and the challenges associated
with advancing freight improvements through the literature review; we
confirmed this information through our interviews with key freight
stakeholders in case study regions. We did not independently assess the
relative success of the various approaches identified. Given that each
approach was applied in areas with regional and geographic differences,
comparisons between approaches cannot be inferred. We also relied on
perspectives obtained from our past work in transportation and
infrastructure systems and federal investment strategies.
To identify challenges that decision makers face in implementing
solutions, we reviewed pertinent literature, including past GAO reports
on freight transportation, and confirmed this information through our
interviews with key freight stakeholders in case study regions. Through
our interviews with transportation stakeholders in local, regional, and
state governments, as well as private shippers and freight
transportation companies, we sought information on the transportation
planning process, the collaboration of various stakeholders during that
process, and various mechanisms used to fund and finance freight-
related transportation projects. These interviews focused on challenges
that are specific to freight transportation solutions. To identify
federal challenges to implementing freight transportation solutions, we
integrated perspectives gained from our prior reports on various
aspects of freight transportation and freight infrastructure. We also
relied extensively on our past work in transportation and federal
investment strategies to elaborate on the key components of a
comprehensive federal freight investment strategy.
We conducted this performance audit from July 2006 through January 2008
in accordance with generally accepted government auditing standards.
Those standards require that we plan and perform the audit to obtain
sufficient, appropriate evidence to provide a reasonable basis for our
findings and conclusions based on our audit objectives. We believe that
the evidence obtained provides a reasonable basis for our findings and
conclusions based on our audit objectives.
[End of section]
Appendix II: Critical Factors and Questions and Components of a Federal
Role in Freight-Related Transportation and Infrastructure Investments:
Table 8: GAO's Critical Factors and Questions for Determining an
Appropriate Federal Role in Freight-Related Transportation:
Factors: Relevance and purpose of the federal role;
Questions: Are some freight transportation issues of nationwide
interest? If so, is a federal role warranted based on the likely
failure of private markets or state and local governments to address
underlying freight problems or concerns? Does current federal
involvement in freight infrastructure encourage or discourage the
private and other public sectors from investing their own resources to
address the problem?
Factors: Measuring success;
Questions: Do current federal funding mechanisms and programs for
freight-related infrastructure have outcome-based performance measures,
and are all applicable costs and benefits considered?
Factors: Targeting benefits;
Questions: Are current funding mechanisms for freight-related
infrastructure targeted to generate national benefits in areas with the
greatest needs and the least capacity to meet those needs?
Factors: Affordability and cost-effectiveness;
Questions: Do current revenue sources and funding mechanisms for
federal freight-related infrastructure encourage state and local
governments and the private sector to invest their own resources? Are
these revenue sources sustainable, and are the funding mechanisms
affordable in the long term? Do these funding mechanisms use the most
cost-effective or net beneficial approaches when compared to other
tools and program designs?
Sources: GAO-05-325SP and GAO-07-770.
[End of table]
Table 9: Three Components of GAO's Framework to Guide Federal
Involvement in Freight-Related Infrastructure Investments:
Component: Set national goals;
Description: These goals, which would establish what federal
participation in the freight transportation system is designed to
accomplish, should be specific, measurable, achievable, and outcome-
based.
Component: Establish and clearly define stakeholder roles, especially
the federal role relative to the roles of state and local governments
and private railroads;
Description: The federal government is one of many stakeholders
involved in freight-related investments. Others include state and local
governments, port authorities, shippers, and the railroads themselves.
Given the broad range of beneficiaries, it is important to gain
consensus on what the transportation system is to achieve and to help
ensure that the federal role does not negatively affect the
participation or role of other stakeholders.
Component: Determine which revenue sources and funding mechanisms will
maximize the impact of any federal expenditures and investment;
Description: This component can help expand the ability to provide
funding resources and to promote cost sharing responsibilities. Given
the current budgetary environment and the long-range fiscal challenges
confronting the nation, federal funding for future freight-related
transportation projects will require a high level of justification and
should be prioritized to maximize national public benefits.
Sources: GAO-02-1033, GAO-05-727, GAO-07-15, and GAO-07-770.
[End of table]
[End of section]
Appendix III: GAO Contact and Staff Acknowledgments:
GAO Contact:
JayEtta Z. Hecker, (202) 512-2834 or heckerj@gao.gov:
Staff Acknowledgments:
In addition to the contact named above, Elizabeth McNally (Assistant
Director), Jaime Allentuck, Carissa Bryant, Jay Cherlow, Colin Fallon,
Holly Gerhart, Mark Gribbin, Greg Hanna, Carol Henn, Bert Japikse, Paul
Kazemersky, Sara Ann Moessbauer, Josh Ormond, John W. Stambaugh, and
Randy Williamson made key contributions to this report.
[End of section]
Footnotes:
[1] GAO, Freight Transportation: Strategies Needed to Address Planning
and Financing Limitations, GAO-04-165 (Washington, D.C.: Dec. 19, 2003)
and GAO, Intermodal Transportation: DOT Could Take Further Actions to
Address Intermodal Barriers, GAO-07-718 (Washington, D.C.: June 20,
2007).
[2] GAO, 21st Century Challenges: Reexamining the Base of the Federal
Government, GAO-05-325SP (Washington, D.C.: February 2005) and GAO,
High-Risk Series: An Update, GAO-07-310 (Washington, D.C.: January
2007).
[3] The case studies include Los Angeles and Long Beach, Calif.;
Houston and Laredo, Tex.; Atlanta, Ga.; and the N.Y. and N.J. port
region.
[4] Cost calculation is in year 2000 dollars. Clifford Winston and
Ashley Langer, "The Effect of Government Highway Spending on Road
Users' Congestion Costs," Journal of Urban Economics, vol. 60 (May
2006).
[5] GAO-07-718.
[6] DOT, "Moving the Economy: National Strategy to Reduce Congestion,"
(Washington, D.C., Nov. 15, 2007). See [hyperlink,
http://www.fightgridlocknow.gov] (accessed on Oct. 25, 2007).
[7] These corridors are I-95 from Florida to the Canadian border; I-70
in Missouri, Illinois, Indiana, and Ohio; I-15 in Arizona, Utah,
Nevada, and California; I-5 in California, Oregon, and Washington; I-10
from California to Florida; and I-69 from Texas to Michigan.
[8] Dollars are in year 2000 inflation-adjusted terms as calculated by
BTS. DOT, BTS, America's Freight Transportation Gateways (Washington,
D.C., 2004).
[9] A ton-mile is defined as 1 ton of freight shipped 1 mile. As such,
changes in ton-miles reflect trends in both volume (tons) and distance
(miles). BTS, A Decade of Growth in Domestic Freight: Rail and Truck
Ton-Miles Continue to Rise (Washington, D.C., July 2007).
[10] Changes in supply chains have increased the volume and frequency
of freight moving across the transportation system and dramatically
increased the reliance of U.S. businesses on transportation. For
example, "just-in-time" production processes enable businesses to lower
inventory carrying costs and add flexibility and adaptability to their
decision-making timelines by closely controlling the quantities and
arrival of source materials.
[11] Cambridge Systematics, An Initial Assessment of Freight
Bottlenecks on Highways, prepared for the Department of Transportation,
October 2005.
[12] Cambridge Systematics, An Initial Assessment of Freight
Bottlenecks; DOT, Freight Performance Measurement: Travel Time in
Freight-Significant Corridors, December 2006; Armando Carbonell et al.,
Global Gateway Regions, September 2005; and David Schrank and Tim
Lomax, The 2007 Urban Mobility Report (College Station; Texas
Transportation Institute, Texas A&M University, September 2007).
[13] Cambridge Systematics, National Rail Freight Infrastructure
Capacity and Investment Study, prepared for the Association of American
Railroads (Cambridge, Mass., 2007).
[14] GAO, Freight Railroads: Industry Health Has Improved, but Concerns
about Competition and Capacity Should Be Addressed, GAO-07-94
(Washington, D.C.: Oct. 6, 2006) and Cambridge Systematics, National
Rail Freight Infrastructure Capacity and Investment Study (Cambridge,
Mass., 2007).
[15] Schrank and Lomax, The 2007 Urban Mobility Report, September 2007.
[16] GAO-05-325SP; GAO-07-310; and GAO, Highway Trust Fund: Overview of
Highway Trust Fund Estimates, GAO-06-572T (Washington, D.C.: Apr. 4,
2007).
[17] GAO-07-718.
[18] The proposed cross harbor tunnel project is one such example in
the New York/New Jersey region. The project study began in 1998, and
the project remains in a planning phase with the earliest estimate for
completion 7 years after approval and funding. The proposed freight
rail tunnel would link New Jersey with Brooklyn, New York, and the
current estimated project costs range from $4.8 to $7.4 billion.
[19] Joseph Bryan, et al., Assessing Rail Freight Solutions to Roadway
Congestion: Final Report, Transportation Research Board, National
Cooperative Highway Research Program Report 586 (Washington D.C.,
November 2007) and Transportation Research Board, Short Haul Rail
Intermodal: Can It Compete with Trucks? (Washington, D.C., 2004).
[20] GAO, Surface Transportation: Strategies Are Available for Making
Existing Road Infrastructure Perform Better, GAO-07-920 (Washington,
D.C.: July 26, 2007).
[21] Global supply chains and domestic freight are vulnerable to
terrorist attack, and heightened security measures could also constrain
freight mobility. Although a number of the stakeholders with whom we
spoke noted their concern that imposing new security requirements would
cause significant new delays, they generally agreed that security
measures are not currently a major factor contributing to freight
delays. In this report, we did not evaluate security measures and
programs.
[22] Containers are standardized shipping containers that can be loaded
directly from ships to trains or trucks.
[23] GAO-07-94.
[24] DOT, Addendum to the 1997 Federal Highway Cost Allocation Study
Final Report (2000), [hyperlink,
http://www.fhwa.dot.gov/policy/hcas/addendum.htm] (accessed on Oct. 25,
2007).
[25] GAO, Freight Transportation: Strategies Needed to Address Planning
and Financing Limitations, GAO-04-165 (Washington, D.C.: Dec. 19, 2003)
and GAO, Railroad Bridges and Tunnels: Federal Role in Providing Safety
Oversight and Freight Infrastructure Investment Could Be Better
Targeted, GAO-07-770 (Washington, D.C.: Aug. 6, 2007).
[26] DOT, Freight Performance Measurement: Travel Time in Freight-
Significant Corridors (December 2006).
[27] DOT, Freight Facts and Figures, 2007 (Washington, D.C., pending).
[28] Cambridge Systematics, National Rail Freight Infrastructure Study,
(Cambridge, Mass., September 2007).
[29] Cost calculation is in year 2000 dollars. Clifford Winston and
Ashley Langer, "The Effect of Government Highway Spending on Road
Users' Congestion Costs," Journal of Urban Economics, vol. 60 (May
2006).
[30] Texas Department of Transportation, Houston Region Freight Rail
Study (Houston, Tex., July 2007), [hyperlink,
http://www.houstonrailplan.com] (accessed Nov. 8, 2007).
[31] Glen Weisbrod et al., Economic Implications of Congestion,
Transportation Research Board, National Cooperative Highway Research
Program Report 463 (Washington, D.C., 2001).
[32] Particulate matter emissions refer to particulate matter 10
microns, or smaller, in diameter or PM-10 emissions. DOT, Freight Facts
and Figures, 2006 (Washington, D.C., 2006).
[33] The EPA designates nonattainment areas based on the regularity
with which the air in the area exceeds criteria pollutant standards.
Nonattainment areas are required to have plans to lower air pollution.
[34] California Environmental Protection Agency, Air Resources Board,
Emission Reduction Plan for Ports and Goods Movement in California
(Sacramento, Calif., March 2006).
[35] New York City Department of Transportation, New York City Truck
Route Management and Community Impact Reduction Study (New York, N.Y.,
March 2007).
[36] GAO-07-770.
[37] ICF Consulting, HLB Decision Economics, Louis Berger Group,
Freight Benefit/Cost Study: Compilation of the Literature, prepared for
the Federal Highway Administration, Office of Freight Management and
Operations, February 2001.
[38] GAO-07-920.
[39] Transportation Research Board, Special Report 252: Policy Options
for Intermodal Freight Transportation (Washington, D.C., 1998);
Transportation Research Board, Special Report 271: Freight Capacity for
the 21st Century (Washington, D.C., 2003); and Federal Highway
Administration, Addressing Freight in the Transportation Planning
Process (Washington, D.C., October 2001).
[40] GAO-04-165.
[41] Transportation Research Board, Special Report 276: A Concept for a
National Freight Data Program (Washington, D.C., 2003) and Federal
Highway Administration, Addressing Freight in the Transportation
Planning Process (Washington, D.C., October 2001).
[42] In an attempt to address this, FHWA has developed a Freight Cost
Benefit Analysis Additive Benefits tool that provides a calculation for
estimating a highway improvement project's benefits to the private
sector by calculating the savings to shippers and manufacturers.
[43] ACTA adopted an Expanded Mission in January 2004 to address cargo
growth at the ports and to optimize use of the existing rail and
highway network while larger scale projects are planned and funded. See
[hyperlink, http://www.acta.org] (accessed on Oct. 4, 2007).
[44] Federal Highway Administration, Addressing Freight in the
Transportation Planning Process (Washington, D.C., October 2001) and
Federal Highway Administration, Office of Freight Management and
Operations, Freight Financing Options for National Freight Productivity
(Washington, D.C., April 2001).
[45] GAO-04-165.
[46] The Alameda Corridor project involved significant collaboration
and investment from the private sector, namely railroads, and was
successfully completed in 2002. The Alameda Corridor East project is
located in a different geographic area but extends the partnership idea
from the first project.
[47] DOT, Office of the Inspector General, Review of Congressional
Earmarks Within Department of Transportation Programs (Washington,
D.C., September 2007) and GAO-07-718.
[48] The freight rail district is tasked with improving railroad
capacity and operation, filling a gap where there has been limited
expertise and focus outside of the rail industry. The district's
mission is to better incorporate rail lines, both freight and commuter,
into the region's transportation network.
[49] According to a DOT report, a typical time estimate for an RRIF
loan to be processed is 1.5 to 2 years.
[50] GAO-07-718; GAO-05-325SP; GAO-04-165; The Brookings Institute,
Principles for a U.S. Public Freight Agenda in a Global Economy,
(Washington, D.C., January 2006); Transport Canada, Literature Review
on Intermodal Freight Transportation, (Ottawa, Ontario, January 2004);
and Transportation Research Board, Global Intermodal Freight: State of
Readiness for the 21st Century, Report of a Conference (Washington,
D.C., 2001).
[51] When public planners make infrastructure decisions based on the
mode eligible for federal funding, this can potentially result in
funding a project for one mode, even when benefit-cost or cost-
effectiveness criteria may favor a project on another mode.
[52] Southern California Association of Governments, Southern
California Regional Strategy for Goods Movement: A Plan for Action
(February 2005, amended March 2005).
[53] GAO-07-770.
[54] This amount is the average authorization from the Highway Trust
Fund from fiscal year 2005 to fiscal year 2009. Most of these funds are
specifically for highway projects.
[55] GAO-07-545.
[56] GAO-07-770.
[57] Office of Management and Budget, Mid-Session Review, Budget of the
U.S. Government, Fiscal Year 2008 (Washington, D.C., July 11, 2007).
[58] GAO, Saving Our Future Requires Tough Choices Today, GAO-07-1164CG
(Washington, D.C.: July 26, 2007).
[59] GAO-05-325SP, GAO-07-1210SP, GAO-07-770, GAO-07-310.
[60] We also concentrated on surface transportation modes, such as,
highways, rail and marine freight modes, in this engagement.
[End of section]
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