Transcript The Transportation Funding Gap This is what you have heard. Twenty Year Funding Needs to Achieve Desired Outcomes ($ billions) Scenario 1 Scenario 2 Scenario.

The Transportation Funding Gap
This is what you have heard.
Twenty Year Funding Needs to Achieve Desired Outcomes
($ billions)
Scenario 1
Scenario 2
Scenario 3
Anticipated Transportation
Revenue Expected Over the Next
20 Years
Maintain Current Performance
Economically Competitive/
World Class System
State Highway System
(State Roads and Bridges)
$18.0
$5.0
$10.0 - 12.0
County State Aid System
$5.0
$1.9
$0.2
$0.9
$8.5
$1.6
$3.2 - $4.8
Passenger Rail
$0.1
─
$5.0 - 7.0
Freight - Rail and Ports
$0.3
$0.3
$0.6
Airports
(Not MAC System)
$1.4
$0.6
$0.8
$36.8
$7.7
$20.5 - $26.1
─
$0.4
$1.0 - $1.3
System/Mode
Municipal State Aid System
Greater Minnesota Transit
Metropolitan Area Transit
$1.6
(thru 2030)
Totals
Annual Funding Gap
Twenty Year Funding Needs to Achieve Desired Outcomes
(20 Year Needs in $ billions) AFG = Annual Funding Gap
System/Mode
Scenario 1
Scenario 2
Scenario 3
Anticipated Transportation
Revenue Expected Over the Next
20 Years (Status Quo)
Maintain Current Performance
For the Next 20 Years
Economically Competitive/
World Class System
For the Next 20 Years
$5.0
$10.0 - 12.0
($250 mil AFG)
($500 mil.- $600 mil AFG)
($2.3)
Initial est.
($0.8)
Initial est.
$0.2
($5.6)
Initial est.
($1.7)
Initial est.
$0.9
($10 mil AFG)
($45 mil AFG)
$1.6
$3.2 - $4.8
($107 mil AFG)
($213 mil- $320 mil AFG)
$5.0 - 7.0
State Highway System
(State Roads and Bridges)
$18.0
County State Aid System
$5.0
Municipal State Aid System
$1.6
Greater Minnesota Transit
$1.9
Metropolitan Area Transit
$8.5
(thru 2030)
Passenger Rail
$0.1
─
Freight - Rail and Ports
$0.3
$0.3
$0.6
($15 mil AFG)
($30 mil AFG)
Airports
$1.4
$0.6
$0.8
($30 mil AFG)
($40 mil AFG)
(Not MAC System)
($250 mil -$350 mil AFG)
An Illustration of Various
Transportation Funding Mechanisms
and Projected Revenue
Generating Capacity
Motor Fuels Tax
Funding Mechanism
Motor Fuels
Taxes
• Gas tax
• Diesel tax
Current Rate
$0.285 per gal.
Incremental Yield
$0.01 yields $32.0
million annually to
HUTDF
Annual Yield
FY 2012
Illustrative Rate and
Annual Yield
$912 million x 95%
= $866.4 million
$0.25 per gal.
increase = $800
million to HUTDF x
95% = $760 million
($40.0 million is
allocated under
statute to counties
and townships)



62% TH =

$537.2 million
29% Counties 
= $251.3
million
9% Municipal 
State Aid =
$78.0 million
20 year Yield
($0.8 billion to
Counties and
Townships)
62% TH =

$471.2 million
29% Counties 
= $220.4
million
9% Municipal
State Aid =

$68.4 million
$9.42 billion
to TH Fund
$4.41 billion
to Counties
State Aid
Fund
$1.37 billion
to Municipal
State Aid
Fund
Motor Vehicle Registration Fees
Funding Mechanism
Registration
Fees
Current Rate
$35 base rate +
1.25% of value
+$10
(Depreciates by
10%/year)
Incremental Yield
0.10% = $46.2
million to Highways
Users Tax
Distribution Fund
(HUTDF)
Annual Yield
FY 2012
Illustrative Rate and
Annual Yield
20 year Yield
0.25% increase =
$115.45 to HUTDF
x 95 % = $109.67
($28.9 million is
62% to TH
allocated under
Fund = $340.0 statute to counties
million
and townships)
29% to CSAH
= $159.0

62% TH =
million
$67.9 million
9% to MSA =

29% Counties
$49.4 million
= $31.8
million
($0.58 billion to
Counties and
Townships)
$577.24 million to
HUTDF x 95% =
$548.38




9% Municipal
State Aid =
$9.9 million



$1.36 billion
to TH Fund
$0.63 billion
to Counties
$0.20 billion
to Municipal
State Aid
Fund
Motor Vehicle Sales Tax
Funding Mechanism
Motor
Vehicle Sales
Tax
Current Rate
6.5% of vehicle
costs
60% HUTD
40% Transit
Assistance Fund
Incremental Yield
1% yields $30
million to TH fund
1% yields $22
million to County
and Municipal
1% yield 35 million
to Transit
Assistance Fund
Annual Yield
FY 2012
Illustrative Rate and
Annual Yield
20 year Yield
$336 million to
HUTDF x 95% =
$319.2 million
($225 million to
Transit Assistance
Fund)



0.50% increase =
$43.15 million x
60% = $25.89
HUTDF (40% to
Transit Assistance
Fund = $17.26
million)
($16.8 million is

62% to TH
allocated under
Fund = $197.9 statute to counties
million
and townships)

29% to CSAH
= $92.6

62% TH
million
=$16.1 million 
9% to MSA =

29% Counties
$28.7 million
= $7.1 million

9% Municipal
State Aid =
$2.6 million

$17.26 to
Transit
Assistance
Fund

($336
million to
Counties
and
Townships)
$321 million
to TH Fund
$141.6 million
to Counties
$52.0 million
to Municipal
State Aid
Fund
$345.2 million
to Transit
Assistance
Fund
Sales Tax
Funding Mechanism
Statewide
Sales Tax
Current Rate
6.875% of
select
purchases
Incremental Yield
1 .0 percent
generates
$670 million
Metropolitan .25% of
.25%
Area Sales
purchases in generates
Tax (5 counties) five counties $100 million
(Anoka, Dakota,
Hennepin, Ramsey,
Washington)
Annual Yield
FY 2012
Illustrative Rate and
Annual Yield
20 year Yield
Annual yield 0.50%
to the state increase =
is $4.6 billion $335 million
$6.7
billion
Annual yield
to County
Transit
Investment
Board (CTIB)
is $100
million
$3.6
billion
.50%
increase =
$200 million
(thru 2030)
Alternative Transportation Financing
Application
Existing State Hwys
New Capacity on State
Highways
New Capacity on State
Bridges
Local Roads and
Bridges
Metropolitan Transit
Transit (Greater MN)
Passenger Rail
Ports and Waterways
Airports (state)
Public-Private Tolling/Direct
Partnerships
User Fees
Value
Capture
Sponsorships
Transportation Improvement Districts
Application
Examples
Area 1:
New
Capacity on
State
Highways
Area 2:
New
Capacity on
Local Roads
Area 3:
Street
Improvement
Districts
Local
Option
Sales Tax
Wheelage
Tax
PublicPrivate
Partnerships
Tolling
Value
Capture
Sponsor- Assessment
ships
Anticipated Outcomes for
Status Quo Scenario: State Highways








Interstates maintained at MAP-21 target
Principal arterials become 16% poor (1,300 miles)
Minor arterials become 42% poor (2,800 miles) by 2032
Bridge condition is well under performance targets with 76%
of bridges in good or satisfactory condition and 20% of bridges
(647 bridges) in poor condition
Safety investments remain at current levels, traffic fatalities
continue to decline
Metro congestion increases and reliability decreases
systemwide, reliability and throughput increase at spot
locations
Inter-regional corridors have limited delays, performance on a
handful of major corridors continues to decline
Little money available for expansion, regional and local
priorities, economic development, etc
Anticipated Outcomes for Maintaining Current
Performance Scenario: State Highways






Interstates maintained at MAP-21 target
Principal arterials become 6% poor by 2032 (454 miles)
Minor arterials become 11% poor by 2032 (741 miles)
Bridges at or near current performance targets
Traffic fatalities continue to decrease
Metro congestion increases slightly systemwide, reliability
improves on future MnPASS corridors and at congestion
management and safety HROI project locations
 IRCs continue to meet performance target
 Modest amount available for expansion, regional and local
priorities, economic development, etc
World Class/Economically Competitive System
Scenario: State Highways
 Interstates maintained at MAP-21 target
 Principal arterials improve to less than 2% poor by 2032
(151 miles in poor condition)
 Minor arterials improve to less than 3% poor by 2032 (202
miles in poor condition)
 Bridge conditions meet targets of less than 2% poor and
greater than 84% good and satisfactory
 Safety investments remain at current levels, MnDOT meets
Toward Zero Deaths fatality targets in future years
 With capacity investments, metro congestion remains
stable, reliability improves on MnPASS corridors and at
HROI locations
 Modest amount available for expansion, regional and local
priorities, economic development, etc
Greater Minnesota Transit
Anticipated Outcomes
 Maintaining current performance
 Annual hours of service remain at projected 2013 level
of 1.23 million hours
 Some revenue is reserved from 2013 to 2022, then
spent to maintain service as inflationary costs exceed
revenue
 Economically competitive/World class
 Minnesota Statutes §174.24
 Meet 80% of transit needs by July 1, 2015
 Meet 90% of transit needs by July 1, 2025
Freight Rail
Anticipated Outcomes
• Rail Grade Crossing Improvement
– Public cost share is 25%
– Performance goal of 50% crossings with gates & signals = 2250
of 4500 crossings vs. 1500 (33%) currently
– Assumes $250K per crossing for gates & signals
– Assumes useful life of signal system is 25 years
• Selected needs as identified in 2010 MN Statewide Rail
Plan.
– Statewide short line railroad track and structure upgrades to
handle Class 1 286,000 lb. rail cars
– Economic development projects include rail-served business
parks, intermodal container, transload, etc
Ports and Waterways
Anticipated Outcomes
• Port upgrades include reconstructing dock walls,
warehouse rehabilitation, improving road and rail
access, limited dredging, loading equipment, etc.
• Appropriations over past five years have totaled
$7.5 million = $1.5 million/year
• Assumes twenty year needs of $90 million based
on average annual needs as identified by the
state’s port authorities
Statewide Airport
Anticipated Outcomes
•
•
•
•
Current System Maintained
Eliminates runway and taxiway extensions
No new airports
Funding priorities: safety, mobility, financial,
operations, preservation
• No new navigation (NextGEN) deployment
• Economically Competitive/World Class
Passenger Rail
Anticipated Outcomes
•
Full build out of Phase 1 projects as a statewide system over twenty-year timeframe:
–
–
–
–
–
–
•
•
Twin Cities to Chicago -110 mph service
Twin Cities to Duluth -110 mph service
Twin Cities to Rochester -150 plus mph service
Twin Cities to St. Cloud, Moorhead -up to 90mph service
Twin Cities to Mankato -up to 90mph service
Twin Cities to Eau Claire -up to 90 mph service
20-year capital cost estimate $4B - $5.1B for priority passenger and share freight rail
improvements if built as a system, built as a series of individual unrelated projects the
20-yr. estimate is $4.5B - $5.7B.
Outcomes:
–
–
–
–
–
–
–
Between 4.1 to 6 million annual riders.
Annual operating subsidies of $41m - $95m are based on a farebox recovery of approximately 71% -49%.
Shared freight and passenger rail improvements
Best case scenario in terms of operations cost
Interstate/intrastate Pass. rail connection to economic centers
2009 $26m in State G.O. Bonds
Phase 1 State Rail Plan projects implemented
Metropolitan Area Transit
Scenario 1 – Status Quo
• Continue to operate the transit system that
exists today and finish Central LRT and Cedar
Stage 1
• System includes:
–
–
–
–
–
–
Existing bus and Metro Mobility service levels
Mandatory Metro Mobility (ADA) service increases
Hiawatha LRT
Northstar Commuter Rail
Central LRT starting in 2014
Cedar Ave BRT Stage 1 starting in 2013
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Metropolitan Area Transit
Anticipated Outcomes for
Status Quo Scenario
•
•
•
•
•
Increased fares
Reduced service
Reduced ridership
Does not address growing demand
Service quality and customer satisfaction
reduced
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Metropolitan Area Transit
Scenario 2 – Maintain Current Performance
• Regional growth requires more transit
investments to maintain current mobility
levels
• System includes:
–
–
–
–
–
–
Scenario 1 service levels
Bus service expansion (0.5% growth / year)
Southwest LRT (SWLRT)
I-35W South BRT
Cedar Ave BRT Stage 2
Three Arterial BRT corridors
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Metropolitan Area Transit
Anticipated Outcomes for
Maintaining Performance Scenario
Expected Outcomes:
+ Positive results for residents
+ Addresses growing transit demand and makes progress
toward doubling ridership by 2030
+ New connections between home, school, work and
entertainment
+ Positive results for businesses
+ Transit spurs economic development
+ Solid infrastructure attracts jobs & development
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Metropolitan Area Transit
Scenario 3 – Economic Competitiveness
• Improved mobility levels for residents and
businesses and enhanced regional economic
competitiveness
• System includes (conceptual example):
–
–
–
–
–
Scenario 1 and 2 service levels
Bus service expansion (1.0% total growth/year over status quo)
Two additional LRT (after SWLRT)
Six additional Arterial BRT corridors
Three additional Highway BRT/Managed Lane corridors
Scenario 3 based on the transit vision in the Council's 2030 Transportation Policy Plan and the
Program of Projects
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Metropolitan Area Transit
Anticipated Outcomes for
Economic Competitiveness Scenario
• Positive results for residents
–
–
–
Addresses more growth in demand and doubling of ridership by 2030
Significantly better connections between home, school, work and entertainment
Faster, cheaper transportation options that are safe and environmentally-friendly
• Positive results for business
–
–
–
Additional 500,000 employees will have access to jobs via transit
Freight and logistics savings
Investments compete well with similar investments in peer regions
• Positive result for all taxpayers: A return on
investment (ROI) between $6.6 and $10.1 billion to
2030
24
Metropolitan Area Transit
Scenario 4 – World Class
• Accelerated transit investment program, sustained beyond
2030
• A more robust, balanced and comprehensive regional
transit system
• System includes (conceptual example):
–
–
–
–
–
–
Scenario 1, 2, and 3 service levels
Bus service expansion (1.5% total growth/year over status quo)
Three additional Arterial BRT corridors
Two additional rail lines
Two additional Highway BRT/Managed Lane corridors
Six streetcar lines
25
Metropolitan Area Transit
Anticipated Outcomes for
World Class Scenario
• Positive results for residents
– Significantly address growth in demand and more than double ridership by 2030
– Extensive connections between home, school, work and entertainment
– Additional faster, cheaper transportation options that are safe and environmentallyfriendly
• Positive results for business
– Additional employees will have access to jobs via transit
– Additional freight and logistics savings
– Position the region to surpass investments in peer regions and further enhance regional
competitiveness
• Positive result for all taxpayers: an ROI between
$10.7 and $16.5 billion in 2030
26
Metropolitan Area Transit Summary
• Scenario 1: results in service cuts and less
mobility and leaves this region falling behind
peers and losing competitiveness
• Scenario 2: brings the region in line with existing
conditions of competing peer regions
• Scenarios 3 and 4: make the region competitive
with peers and provide opportunities to attract
additional investment
27