The Role of Transportation Agencies in Reducing Oil Dependence and Greenhouse Gases

Draft energy and climate legislation released in May by Senators John Kerry (D-MA) and Joe Lieberman (I-CT) contains policy and funding provisions directed toward state and metropolitan transportation agencies to help them reduce oil use and the greenhouse gas (GHG) emissions which cause climate change . These transportation provisions differ significantly from previous versions of energy legislation—most notably, by allocating more than $6 billion in revenue toward transportation infrastructure.

The most important provision, however, would establish GHG reduction targets for state transportation agencies and would require the development of plans to meet those targets. If enacted, transportation agencies would have, for the first time, a clear signal to incorporate oil and GHG reduction goals into their regular transportation planning and funding decisions.

These sections of the draft bill (sections 1711, 1712, 1721) are appropriately labeled as "transportation efficiency" measures. Transportation agencies would pursue their core mission of moving people and goods in a safe and cost-effective manner, but impacts on oil use and GHGs would be an additional decision-making factor.

Relatively few transportation agencies have seriously attempted this level of planning, but early experiences in metro areas, such as Sacramento and Portland, suggest that oil and GHG efficiency also translates into cost and functional efficiency. Scenario analyses show large potential savings in fuel costs and infrastructure construction and maintenance.

An important question that many transportation stakeholders have is how such provisions and requirements will affect the economy. The intent is to provide incentives and resources for transportation agencies to develop innovative and integrated ways to meet multiple objectives — economic, environmental, safety etc.

Transportation officials have generally not had the tools with which to measure performance of transportation investments, nor have they been rewarded for achieving desired outcomes. Federal transportation funding has most typically been allocated by formula to the states—meaning they get the same amount of money each year whether results are achieved or not. The transportation planning provisions in the Kerry-Lieberman bill would begin a shift toward new funding mechanisms that direct dollars toward projects that will have the greatest "return" on investment.

And when Congress finally addresses the overdue transportation authorization bill (the previous bill expired last year), these performance-based concepts can be extended to all areas of transportation policy. There is limited experience in more rigorous, performance-based funding and planning tools for safety, congestion reduction, freight, and other areas. However, with the current revenue shortfall in the Highway Trust Fund and a very uncertain future for federal funding in general, transportation agencies may have no choice but to innovate and experiment with strategies to get more results from each transportation investment dollar.