American Road and Transportation Builders Association (ARTBA) President & CEO Pete Ruane Nov. 1 told nearly 300 industry and government officials that the “nation’s status quo highway program is no longer acceptable, and needs to be reformed, refocused, restructured and refinanced.” He made the comments at ARTBA’s 19th Annual Conference on Public-Private Ventures in Transportation.

In his presentation, Ruane outlined the association’s vision for the future federal highway program. It includes greater investment to repair and upgrade the current highway/transit network, and creation of a new federally led program, “Critical Commerce Corridors” (3C), to provide the capacity and intermodal connections necessary to facilitate the safe and efficient movement of freight. He stressed that all funding options must be on the table, including private investment, expanded user fee mechanisms and leveraged funds.

Ruane’s prepared remarks follow:

Ladies and gentlemen, the status quo highway program is no longer acceptable. It needs to be reformed, refocused, restructured and refinanced.

We need a program that meets the needs of Americans in this century.

In the 1950s, the federal government embarked on a major initiative in partnership with the states to build the Interstate Highway System. This objective transcended parochial concerns of individual states and provided a clear sense to the public about the value of their financial contributions to a national transportation system.

The similar national challenges facing the U.S. transportation network today are twofold: upgrading the existing system to meet the demands currently being placed on it; and preparing for the future growth that will, among other things, significantly impact the ability of the U.S. economy to remain competitive in the global marketplace.

As you saw in the video, ARTBA’s vision for the federal surface transportation programs would reform, refocus and restructure them to address two separate, yet equally important, objectives:

First, the program should focus attention and substantially greater financials resources on upgrading and protecting the nation’s enormous past investments in surface transportation infrastructure. The proper mechanism for that is the federal highway user fee, or gas tax.

Second, the federal government should play the lead role in initiating a program focused on providing the substantial new capacity necessary to meet U.S. freight movement and emergency response needs in this century. We call it the “Critical Commerce Corridors” or “3C” program. We would fund it with new, “fire-walled” freight-related user fees, private investments and leveraged funds.

ARTBA leaders have presented these ideas to the National Surface Transportation Policy and Revenue Study Commission that is chaired by U.S. Transportation Secretary Mary Peters, and congressional committees.

In recent months, the National Asphalt Pavement Association, the National Stone, Sand and Gravel Association, the Portland Cement Association, and the American Concrete Pavement Association have endorsed our 3C proposal. AASHTO, the state transportation officials’ group, included the 3C proposal in a set of recommendations it sent to the federal commission in July. Leaders of the American Trucking Associations have also spoken favorably of our approach.

It should also be noted that top leaders of national business groups like the U.S. Chamber of Commerce and the National Association of Manufacturers are now publicly expressing a willingness to look at all revenue options because of the dire state of our transportation network.

I would hope that everyone in this room can visualize the absolutely enormous market potential the “Critical Commerce Corridors” program would have for your companies… or, if you are public officials, the economic benefits that would accrue to the citizens you serve.

The demand for investment in high-cost new capacity projects can be found across the country. And we don’t need decades to study what we need to do! What we need is a strategic national business plan that prioritizes projects regionally, identifies and puts to work all available finance mechanisms and goes to work.

We can start with high-cost, yet high pay-off improvements to the Interstate Highway System. For example, Federal Highway Administration has already identified almost 200 highway interchange bottlenecks that each cause more than 250,000 hours of truck delay annually! Existing right-of-way can, and should be used to address these.

The states themselves have already identified many multi-state regional projects—like the “Great Plains International Trade Corridor” which run through seven states from Texas to North Dakota, providing access from Mexican gateway cities and ports in Texas to population and distribution points to the Canadian gateways.

Or the “Ben Franklin Corridor,” designed to link the strategic port of Philadelphia with significant commercial and military hubs in Pennsylvania, Ohio, New Jersey and New York.

The “Ben Franklin” is envisioned as part of a larger “American Marine Highway Corridor” that would link the East Coast ports in Philadelphia, Charleston, South Carolina, and Savannah, Georgia, with the Gulf Ports of Beaumont and Corpus Christi, Texas.

The state’s themselves have identified high-cost priority projects within their borders that would have huge economic pay-offs regionally and nationally—like the addition of “truck only lanes” or “truck-rail” lanes along the heavily congested I-81 in Virginia.

And everyone in this room is familiar with the pioneering work being done on the Trans-Texas Corridor projects.

Or the Alameda Corridor East Project that would link the ports of Los Angeles and Long Beach with the San Gabriel Valley “Inland Empire.” Or the “CREATE” project in Chicago.

All that is lacking to get these projects really rolling is federal leadership that pushes a coordinated national plan and makes available, or possible, the financing mechanisms necessary to move out!

We can’t say we have a “National Corridor Infrastructure Program” and only provide $400 million per year spread across three-dozen projects. That’s what SAFETEA-LU gave us.

Business as usual won’t cut it!

We have been holding this conference for 19 years and I can think of no time when the role of public-private partnerships in transportation has been more high profile or, for that matter, controversial.

One of the major themes that will dominate the 2009 SAFETEA-LU reauthorization debate, which is already playing out, is the role of the federal government in addressing the nation’s transportation needs. This is a worthwhile discussion that has brought forward two contrasting, but firmly held beliefs.

On one side are those who believe the federal government should not be involved in transportation or should have a greatly reduced role.

On the other, is the perspective that the Constitution and past accomplishments like the Interstate Highway System clearly justify and demonstrate the need for strong federal leadership in this area.

Whether you like it or not, public-private partnerships are squarely in the middle of what is really an ideological debate. Because devolutionists need to offer an alternative to the federal role, some are suggesting private sector capital and mechanisms like congestion pricing and other direct taxes, I mean user fees, can and should supplant traditional federal investment mechanisms — specifically the gas tax.

Unfortunately, this has led some defenders of the traditional programs and financing mechanisms to question private investment approaches… not because they believe they are inherently wrong, or not part of the solution, but simply because they believe a strong federal role is needed now more than ever and they are not willing to cede the political playing field.

Our challenge, as transportation infrastructure advocates, is to navigate this political minefield.

And the best tool we have in our arsenal is the truth. Remember, there is a big difference between facts and ideology. 

The fact is the nation’s transportation needs are so great and without proactive steps we are rapidly approaching crisis stages. The only way to realistically address this situation is to utilize both traditional and non-traditional methods. To suggest that in less than two years some new form of financing is available to be implemented nationwide to close the $19 billion annual gap between documented highway and bridge needs and available revenues is bunk.

It is equally unrealistic to suggest the gas tax alone can solve all the nation’s surface transportation needs.

That is why ARTBA is strong proponent of increasing federal Highway Trust Fund revenues AND expanding the use of public private partnerships. Only through a combination of these approaches can meaningful progress be achieved.

Are P3s the panacea? No. But, they are vital keys to solving our nation’s transportation capacity and operational problems.