ODOT’s “Fix-it first” fraud

ODOT claims that its policy is “fix-it first” maintaining the highway system.

But it is spending vastly less on maintenance and restoration than is needed to keep roads and bridges from deteriorating

It blames the Legislature for not prioritizing repair over new construction

But it chooses to advance policies that prioritize spending money on new construction ahead of maintenance

It diverts funds that could be used for maintenance to pay for cost overruns on capital construction projects.

ODOT pleads its maintenance backlog as a “bait and switch” to get more revenue that it then spends on capital construction rather than fixing roads

A proclaimed “Fix-It First” policy.

The Oregon Transportation Commission (OTC) which directs the activities of the Oregon Department of Transportation, has clearly claimed to prioritize maintenance.  In its 2020 Investment Strategy, OTC proclaims it prioritizes maintenance of existing roads:

Oregon is a fix-it first state. The Oregon Transportation Plan and Oregon Highway Plan focus on preserving the system; highway improvements are focused on enhancing efficiency and the capacity of existing facilities rather than building new ones. . . . Funding to preserve state highway assets is not adequate, resulting in a triage approach to preservation, rehabilitation, and repair, and maintaining status quo conditions requires more than doubling current funding.

The Oregon Transportation Commission has adopted the Oregon Highway Plan’s policy 1G for Major Improvements which says it will prioritize maintaining the highway system over expanding capacity.

Since road construction is very expensive and funding is very limited, it is unlikely that many new highways will be built in the future. Instead, the emphasis will be on maintaining the current system and improving the efficiency of the highways the State already has. The Major Improvements Policy reflects this reality by directing ODOT and local jurisdictions to do everything possible to protect and improve the efficiency of the highway system before adding new highway facilities.

Policy 1G: Major Improvements

It is the policy of the State of Oregon to maintain highway performance and improve safety by improving system efficiency and management before adding capacity.

A huge and growing maintenance backlog

So how is Oregon doing in implementing this policy:  Every report and inventory from ODOT shows that we have a major maintenance gap, and it’s getting worse.

ODOT’s June 2022 federally required Transportation Asset Management Plan (TAMP) reports that Oregon is spending $329 million annually less than is needed to keep roads and bridge at their current state of repair>  The state is spending less than half of what it would need to ($156 million of an estimated $320 million) just to “maintain current conditions” of Oregon bridges.  It is also spending only about 40 percent of what it needs to retain existing conditions on Oregon roads ($112 million of an estimated annual need of $273 million).  Bridges would require an additional 164 million and roads an additional $165 million, each year, in order to simply maintain current conditions.

ODOT’s Investment Strategy, adopted in 2020 admits it is dramatically underspending on maintenance, and that Oregon roads and bridges will deteriorate.  The state has other manifold needs that aren’t funded.

  • ODOT’s plans say we need to spend $5.1 billion seismically retrofitting hundreds of Oregon Bridges:  It currently has funding for just 30 of 183 high priority “Phase I” bridges–the balance are unfunded.
  • ODOT says we need to be spending $50 million per year to achieve compliance with the Americans with Disabilities Act on Oregon highways
  • ODOT says we need to be spending $53 million per year to provide or repair walking and biking facilities along state highways.

In the face of a tight budget, ODOT has chosen to cut its operations and maintenance, but still expects an even larger shortfall.  In the years ahead.  ODOT’s January 2022 Budget Outlook predicted a widening budget shortfall:

ODOT now projects that the funding gap has shrunk to $144 million in 2027,   due to stronger revenue growth and larger fiscal year 2021 ending balances through budget discipline. However, revenues and expenditures remain out of alignment, and without additional revenue or expenditure reductions the gap will grow quickly. By 2029 the gap is projected to grow to $515 million.

In short, we’re not spending enough to maintain the current system, we’re cutting operation and maintenance budgets and are facing an even larger shortfall in maintenance funding in the years ahead.  And in the face of this, ODOT is marching forward with unfunded plans for huge construction projects that will plunge the state into debt for decades.

Blaming the Legislature

ODOT blames the Legislature for this policy choice.  In a 2020 memo to employees, published by the Oregonian, ODOT Director Kris Strickler says the reason the agency has to slash operating costs and maintenance is because the Legislature short-changed the agency.  Here’s the Oregonian’s coverage:

“Many will wonder how ODOT can face a shortfall of operating funding after the recent passage of the largest transportation investment package in the state’s history,” Kris Strickler, the agency’s director, said in a Wednesday email to employees, stakeholders and other groups, citing the 2017 Legislature’s historic $5.3 billion transportation bill. “The reality is that virtually all of the funding from HB 2017 and other recent transportation investment packages was directed by law to the transportation system rather than to cover the agency’s operating costs and maintenance.”

The public and likely the Legislature will be surprised to know that “directing money by law to the transportation system” somehow precludes ODOT from spending money to maintain those roads.  The truth is that ODOT’s deceptive cost estimates and discretionary reallocation of funds are really what’s short-changing operations and maintenance.

Constantly proposing new construction and under-estimating its cost

While ODOT blames the Legislature, it is the agency advancing hugely expensive new capacity projects, including the I-5 Rose Quarter (1.45 billion), I-5 Bridge Replacement/freeway widening ($5 billion+), I-205 Abernethy Bridge ($700 million) and Boone Bridge (not revealed).

The Legislature approves these projects based on cost estimates provided by ODOT and then ODOT treats this as a mandate to pay whatever cost-overruns the project incurs.  In the case of the I-5 Rose Quarter project, the Legislature was told it would cost $450 million in 2017; the current price tag is now estimated at as much as $1.45 billion.  ODOT told the Legislature the I-205 Abernethy Bridge would cost $250 million; its price tag has doubled to nearly $500 million.  These cost overruns directly reduce funding available for maintenance.  By failing to correctly estimate costs, and by always paying for cost-overruns, ODOT’s actual policy prioritizes new capacity construction over maintenance.

Diverting maintenance funds to new construction

ODOT routinely diverts funds allocated to and available for maintenance to fund capital construction projects.

It used interstate maintenance discretionary funds to pay for the planning of the failed Columbia River Crossing project.  It diverted funds that could otherwise be used for maintenance to pay for the Interstate Bridge Replacement project.  It routinely prioritizes capital construction in the use of “unanticipated federal funds” and “project savings.”  It cobbled together just these funding sources to pay for the initial work on the I-205 Abernethy Bridge before the Legislature authorized any funding for the project.  Each year it gets a tranche of what it calls “unexpected” federal funds (federal money that is unspent from nationally competitive programs that is allocated to the states).  At its July, 2022 meeting ODOT recommended (and the OTC approved) using this money, which could be applied to the maintenance backlog, to fund $10 million towards the Interstate Bridge Replacement project.

This bias toward highway expansion at the expense of maintenance will be amplified by ODOT plans to issue massive amounts of debt for new highway construction. ODOT is pursuing a risky bonding strategy for billions of dollars of Portland-area freeway expansion projects, that effectively pledges to use maintenance monies to repay bond-holders.  HB 3055 allows ODOT to pledge all of its state and federal funds to the repayment of toll-backed bonds.  If toll revenues are less than projected–which happens frequently–ODOT would be legally obligated to cut funding for maintenance statewide to pay back bond holders.

Bait and switch

For years, ODOT has come to the Legislature, pleading poverty:  It doesn’t have enough money to maintain our roads, therefore, we need to increase gas taxes, weight-mile taxes and registration fees.  Then, when the Legislature authorizes higher taxes, ODOT uses this money not to reduce the maintenance backlog, but instead to fund giant new construction projects.  When these projects go over budget, it cannibalizes funds that could be used for maintenance, and comes back to the Legislature, again pointing to its self-created backlog of funding needs to fix potholes and preserve bridges.  In reality, Oregon is a “fix it last” or “fix it never” state:  the maintenance spending backlog is just a perpetual excuse to force the Legisalture and taxpayers to give the agency more money, which it will then plow into expanding roadways.

 

 

A bridge too low . . . again

Ignoring the Coast Guard dooms the I-5 Bridge Project to yet another failure

The Oregon and Washington DOTs have again designed a I-5 bridge that’s too low for navigation

In their rush to recycle the failed plans for the Columbia River Crossing, the two state transportation departments have failed to address Coast Guard navigation concerns

State DOT PR efforts are mis-representing the approval process:  The Coast Guard alone, decides on the allowable height for bridges, and only considers the needs of navigation.  

Make no mistake, the Coast Guard officially drew a line in the sand–actually, 178 feet in the air above the Columbia River–and has essentially said that the two state DOTs “shall not pass” with a river crossing that doesn’t provide that level of navigation clearance.

What the preliminary determination is intended to do is signal to the DOTs the kind of structure that the Coast Guard will likely approve.  But the Oregon and Washington DOTs aren’t taking the hint.  Instead, they’re pretending that this “determination” is really meaningless, and that if they just show that the height restriction would be inconvenient or expensive for them to comply with, that they can somehow force the Coast Guard to let them build a bridge with a lower navigation clearance.  That’s a clearly wrong reading of the law, and more importantly it means the two State DOTs are embarking on a risky strategy that’s likely to doom the current effort to build a new Columbia River Bridge.

Prolog:  The failure of the CRC

As we’ve pointed out, this is deja vu all over again.  The Columbia River Crossing project similarly ignored Coast Guard signals that a low bridge would be unacceptable.

More than a decade ago, the Oregon and Washington DOTs advanced a plan for a new fixed-span I-5 bridge with a navigation clearance of 95 feet.  The DOTs did their own analysis of shipping needs, and claimed that, in their opinion, 95 feet would meet the reasonable needs of river users.  The trouble is, that determination isn’t up to state DOTs:  it’s the exclusive legal province of the US Coast Guard, which is charged by Congress with protecting the nation’s navigable waterways.  (Despite the moniker “Department of Transportation” state DOTs have essentially no legal or policy responsibility for commercial water traffic.

Early on in the bridge design process–in 2005–the Coast Guard signalled its likely objections to a mere 95-foot river clearance.  But state DOT officials blundered ahead, insisting that their own analysis was sufficient to justify the low design.  At the time it issued its record of decision in December 2011, the Coast Guard filed a formal objection, noting that the two state DOTs had not provided sufficient information for the Coast Guard to make the determination as to the needed clearance.  The Coast Guard wrote:

. . . the Coast Guard’s concerns with the adequacy of the Final Environmental Impact Statement (FEIS) have not been resolved . . . As previously stated, the Coast Guard cannot determine if the preferred 95-foot bridge clearance will meet reasonable navigation requirements based on the information provided for review.

In addition, the Coast Guard noted that the FEIS failed to consider the environmental effects of different bridge heights:

The FEIS does not address current and future impacts to navigation/waterway users as a result of proposed decreased vertical clearance, nor does it study alternatives to a vertical clearance other than 95 feet.

As the bridge permitting agency, the Coast Guard determines the reasonable needs of navigation when acting upon a permit application.

Only after completing the FEIS and getting a ROD did the two state transportation departments start applying for the needed Coast Guard bridge permit.  In December 2012, the Coast Guard made it clear that the proposed 95-foot clearance would not be sufficient.  Ultimately, the Coast Guard insisted on at least a 116-foot river clearance.

Here we go again

Even though they’ve been working on reviving the Columbia River Crossing since 2018, the two state DOTs only submitted a new navigation report to the Coast Guard in November 2021.  For more than three years they’ve been operating under the assumption that the Coast Guard will go along with a 116-foot navigation clearance.  But in its “Preliminary Navigation Clearance Determination” the Coast Guard has said that won’t be nearly enough.

The Coast Guard is crystal clear about its approval standard:

“Generally the Coast Guard does not approve bridge proposal with vertical navigation clearances below the ‘present governing structure’ when the existing VNC has been and is currently needed unless there is a compelling navigational reason to do so.” (Harris to Goldstein, June 17, 2022, p. 2)

The real takeaway from the Coast Guard letter is that the I-5 bridge needs to provide 178 feet (or more) of vertical navigation clearance.

. . .  the Columbia River (specifically the section of the Columbia River immediately east of the existing I-5 twin bridges) has and needs to continue to provide VNC equal or greater than the existing I-5 twin bridges of 178 feet. Our PNCD concluded that the current proposed bridge with 116 feet VNC, as depicted in the NOPN, would create an unreasonable obstruction to navigation for vessels with a VNC greater than 116 feet and in fact would completely obstruct navigation for such vessels for the service life of the bridge which is approximately 100 years or longer. (Emphasis added)

The implication is that if the two DOTs can work out a financial deal with existing river users it can get Coast Guard to approval a lower bridge clearance.  But Coast Guard’s past comments and current review indicate that it is not merely looking out for the interests of current river traffic and industry, but is intent on protecting the current navigational channel for future industry and activities.

The reasons for the Coast Guard’s decision are clearly laid out in its June 17, 2022 letter:

  • Current users need to move structures and vessels with a clearance of between 130 and 178 feet.
  • Vessels and their cargos are growing larger over time.  Marine industries need the flexibility to accommodate larger structures in the future.
  • There are no alternative routes for waterborne traffic to reach areas East of the I-5 bridges; in contrast their are many alternate routes for terrestrial traffic (cars, trucks and trains).
  • Water access to the area East of the I-5 bridges, including PDX airport and the Columbia Business Center marine industrial area in Vancouver may be needed in the event of a natural or national emergency
  • Historically, the Columbia Business Center has been a preferred site for shipyard activity (it housed the Kaiser Shipyard in World War II) and may be needed again for this purpose in the future

The Coast Guard’s conclusion makes it clear that it is strongly committed to maintaining the existing river clearance, that it won’t approve a 116 foot bridge, and that the economic effects of this would be unacceptable.  It also pointedly directs the two state DOTs to evaluate either a tunnel or a moveable span to meet its 178-foot requirement:

The Columbia River System is an extremely important interdependent-multimodal supporting national and international commerce critical to local, national and global economies. Reducing the capability and capacity of the Columbia River System would severely restrict navigation. IBR’s proposed bridge as depicted in Public Notice 02-22 with its 35% reduction of VNC from 178 feet to 116 feet is contradictory to the U.S. Coast Guard’s mandate from Congress to maintain freedom of navigation on the navigable waters of the U.S. and to prevent impairment to U.S. navigable waterways. As new structures are built, navigation clearances should be improved or at a minimum maintained. Any proposed new bridge should have a VNC of greater than or equal to that of the existing I-5 twin bridges of 178 feet or preferable, unlimited VNC, as well as a HNC as permitted during the final USACE 408 permit. There are alternative options to accomplish this VNC to include a tunnel or a high-level lift bridge or bascule bridge, which would provide an unlimited vertical clearance. A modern similar successful project is the Woodrow Wilson Bridge over the Potomac River in Washington, DC that was completed in 2009. It is a higher-level double bascule lift bridge on an interstate (I-95) with transit. The added height of the new bridge reduced the number of bascule bridge openings for vessel passage by 76%. (Emphasis added)

The DOT Strategy:  Maximum Risk

Once again, the state DOTs have delayed as long as possible confronting the issue of the navigation clearance.  This time, having learned from its prior experience, the Coast Guard has insisted that the navigation issue be addressed prior to the environmental impact statement.

Still, the DOTs are equivocating, implying that the Coast Guard decision has no weight, and arguing that the legal standard for review involves some kind of balancing of DOT interests in a convenient and cheaper low clearance bridge and implying that the DOTs and not the Coast Guard are the ones who determine the minimum navigation clearance.

The best way to minimize risk is to advance a series of possible alternative solutions through the SEIS process.  At a minimum, these should include a lower level bridge with a lift span, and some kind of tunnel.  In the event that the Coast Guard sticks to its preliminary determination, which is a strong possibility, if not a very high probability, this will mean that the project will be able to move forward.  The DOTs solution, to move forward with only a fixed span, runs the risk that the Coast Guard will hold firm to its announced intention to require a minimum 178 feet of clearance, meaning that two or three years from now the project will be back to square one with no legally buildable, environmentally reviewed project.  All of the project sponsor’s supposed concern with being able to compete for funding will be jeopardized by this reckless decision to look only a fixed span.

USCG PNCD IBR 17June2022

Oregon and Washington DOTs plan too low a bridge–again.

The Coast Guard has told Oregon and Washington that a new I-5 bridge must have a 178-foot vertical clearance for river navigation–vastly higher than the 116-foot clearance the state’s have proposed

A fixed span with that clearance would be prohibitively expensive and would have to be huge–nearly 2 miles long, and would have steep grades. 

An easier solution would be a new bridge with a moveable span, such as that built for I-95 in Washington DC, yet IBR officials tell falsely claim an I-5 liftwapan would have to be “the world’s largest”

Three Portland area bridges have bascule spans of comparable size to that needed for the I-5 bridge, and much larger bascule and vertical lift bridges have been built elsewhere.

Our story so far:  For the past three years the Oregon and Washington Departments of Transportation have been trying to revive their plans for the failed Columbia River Crossing, a massive freeway expansion project between Portland and Vancouver.  The project would require replacing the existing I-5 bridges over the Columbia River, and the height of these bridges will be determined by the US Coast Guard.  In June, the Coast Guard issued its “Preliminary Navigation Clearance Determination” (PNCD) saying that the bridges would have to at least preserve the current navigational clearances (178 of vertical space.  That immediately threw a wrench into the DOT plans to build a fixed span with just 116 feet of clearance.  The Coast Guard declared unequivocally:

Our PNCD concluded that the current proposed bridge with 116 feet VNC [vertical navigation clearance], as depicted in the NOPN [Navigation Only Public Notice], would create an unreasonable obstruction to navigation for vessels with a VNC greater than 116 feet and in fact would completely obstruct navigation for such vessels for the service life of the bridge which is approximately 100 years or longer.

B.J. Harris, US Coast Guard, to FHWA, June 17, 2022, emphasis added.

The Interstate Bridge Replacement Project is hoping to get the Coast Guard to back down, in part by asserting that it would be impossible to build a lift span to provide the Coast Guard’s requirements.

IBR Administrator Greg Johnson testified to the Joint Oregon-Washington I-5 Bridge Committee, that if the Coast Guard required the I-5 bridge to be built with a lift span, it would be the largest such structure in the world.

Here’s a transcript of that meeting, from approximately minute 18 of the audio-video recording created by the Oregon Legislature.  IBR Administrator Greg Johnson describes the impact on the project of going to a lift span:
.  . .  a cost of putting what would in essence be the largest lift span in the world. We’re talking about an additional $400 million in that way. So, these are the trade offs that we have to look at the viability of a lift span that large which has never been operated at that size before . .  .
(emphasis added)

That’s simply not true.  In fact, there are other lift spans in the Portland area that are as large, or larger, than would be needed to include a lift span on the I-5 bridges, as we document below.

But Administrator Johnson’s claim is both ominous and vague.  How large would the navigation opening in a lift span need to be?   That determination will be made by the US Coast Guard.  The current bridge has a vertical navigation clearance of 178 feet. The 2012 Navigation Impact Report prepared for the Columbia River Crossing documented the existing navigation clearances of the I-5 bridges, which are 178 feet vertically and 263 feet horizontally.  The bridge also has a barge navigation channel with a maximum horizontal clearance of 511 feet, but this barge channel has a vertical clearance of from 46-70 feet.  The Coast Guard’s preliminary navigation report said that a new bridge should at least preserve both of the current horizontal and vertical clearances.

Needed Navigation Clearances:  178 feet high, 263 feet wide

Here’s the text of the Columbia River Crossing’s navigation report, showing existing bridge clearances.  Keeping the existing main shipping channel, shown on the left, would require a vertical clearance of 178 feet and a horizontal clearance of 263 feet.  The Army Corps of Engineers authorized navigation channel under the I-5 bridge is 300 feet wide, but the actual horizontal clearance under the bridge is 263 feet.  .

In addition, maximum river channel on this stretch of the Columbia River is already constrained by the next downstream bridge, which is the Burlington Northern “9.6” bridge (less than a mile West of the I-5 bridges).  This railroad bridge has a swing span with an opening width of about 230 feet. In order to provide a 263 foot wide channel, the I-5 bridge would need two bascule leaves with a length of 135 feet each.

One does not have to look far in the Portland Metro area to find such bridges.  There are three in the center of downtown Portland, the Morrison Bridge and the Burnside Bridge.  The Morrison Bridge (1958) has two bascule lift sections, with an opening of 284 feet.  The Burnside Bridge (1926) also has  two bascule lift sections, with an opening of 252 feet.  The Broadway Bridge (1911-12)–a slightly different kind of bascule–has an opening of 278 feet.

The Burnside Bridge, 1926:  252 foot wide opening.

The Morrison Bridge (1958):  284 foot wide opening

The Broadway Bridge (1911-12):  278 foot wide opening

Nor is the width of the needed roadway an obstacle.  The Morrison Bridge has a roadway width of 90 feet—exactly the same as the width proposed for each of the two aborted Columbia River Crossing bridges.

Woodrow Wilson Bridge:  A modern busy Interstate with a lift-span

But can we have lift spans on Interstate highways?  Actually, the answer is yes.  I-95, the one of the nation’s busiest freeways connecting the major metro areas on the East Coast has a lift span in Washington DC.  The Woodrow Wilson Bridge, opened in 2009, has a modern double leaf bascule bridge that carries 12 travel lanes and 250,000 vehicles per day across the Potomac River.  Also, there’s some question about the width of the roadway on the bascule bridge.  For the record, the Woodrow Wilson Bridge has two separate sets of “leaves” for the north and south bound sections of I-5 (i.e. it’s like two bascule bridges side by side).

Woodrow Wilson Bridge

The Woodrow Wilson Bridge allows for a relatively low level crossing of the Potomac River, minimizing the height and footprint of interchanges on either side of the river (shown above)

Rather than towering over the Vancouver waterfront, and requiring lengthy elevated roadway sections across downtown Vancouver and over Hayden Island, a bascule lift-span bridge could be built at a much lower level, eliminating the need to rebuild intersections high into the air to meet a fixed span high enough to clear 178 feet.

In contrast, a fixed-span high-level bridge violates both the pledges to respect the environment and promote equity.  It hurts the environment, because the high bridge requires vehicles to climb over a much higher elevation, leading them to consume more fuel and emit more pollutants than would be the case with a lower elevation lift-span crossing.  This is especially true for heavy trucks that will struggle to climb the high bridge’s steep grades, and which will create a safety hazard for faster moving cars.  The high bridge is also inequitable for those who are not traveling by car:  those who walk on bike or on foot will find the steep grades associated with the high bridge much more taxing the motorists, who will simply have to press harder on the accelerator pedal.

Not the world’s largest lift bridge

Contrary to what IBR staff imply, there’s nothing unusual about the size of the possible lift-span for the I-5 bridge.  Large bascule bridges are not uncommon.  The Rethe bridge in Hamburg Germany, built in in 2016, has an opening of about 308 feet.  The Erie Avenue Bridge in Lorain, Ohio, built in 1940, has an opening width of 330 feet. The Market Street Bridge in Chattanooga, has an opening that is 358 feet wide.

Rethe Bridge, Hamburg:  308 foot opening

An I-5 lift span meeting the Coast Guard’s requirements would not only not be the largest lift-span in the world; it wouldn’t be even the largest lift span in the neighborhood  That particular honor belongs to the Burlington Northern Willamette River Bridge 5.9, which has a vertical clearance of over 200 feet, and a moveable span that is more than 500 feet long–higher, and almost twice as wide as the needed opening for a new I-5 moveable span meeting Coast Guard requirements.

The Burlington Northern Willamette River Bridge: 200 feet high, 500 foot opening.

The Sauvie Island Bridge arch is barged under the BN Willamette River railroad bridge
This lift span was paid for by the federal government in 1989 and has a lift span that is 516 feet long and it provides a vertical clearance of 200 feet.  The lift span was added to the existing bridge in place of a swing span  for a cost of less than $40 million (about $125 million in today’s construction expense).

Repeating Past Mistakes:  Planning a Bridge Too Low

A decade ago, the Oregon and Washington Transportation Departments tried to force the Coast Guard to agree to a fixed Columbia River Crossing I-5 bridge with a height of just 95 feet over the river, arguing (exactly as they are now) that this lower level best balances the needs of different forms of transportation.  Balancing needs of road users, though, is not the legal standard applied by the Coast Guard, which following federal law, prioritizes the needs of river navigation.  As the Coast Guard said in its review, road users have many alternate routes for crossing the Columbia River; waterborne commerce has none.

 

The two DOTs attempt to force the Coast Guard to agree to a lower bridge height added more than a year of delays to the CRC process (which ultimately failed) as well as millions of dollars in added planning costs.  The IBR team has no plans to seek a bridge permit before 2025, and thereby seems intent on repeating this mistake–moving forward with attempts to convince the Coast Guard to approve a lower navigation clearance, while spending tens of millions of dollars planning a bridge that may not meet the Coast Guard’s legal requirements.

References:

Price Indexes for highway construction.
  • Federal Highway Administration (1989-2003).  https://www.fhwa.dot.gov/programadmin/pt2006q1.cfm
  • FHWA, Highway Construction Cost index (2003=1)  2021Q4=2.19
    https://explore.dot.gov/views/NHIInflationDashboard/
Coast Guard Preliminary Navigation Clearance Determination
https://www.interstatebridge.org/media/fi2b3xei/ibr_next_steps_bridge_permitting_june2022_remediated.pdf

ODOT’s Reign of Error: Chronic highway cost overruns

Nearly every major project undertaken by the Oregon Department of Transportation has ended up costing at least double its initial estimate

As ODOT proposes a multi-billion dollar series of highway expansions, its estimates pose huge financial risks for the state

ODOT refuses to acknowledge its long record of cost-overruns, and has no management strategy to address this chronic problem

Costs are escalating rapidly for more recent and larger projects, indicating this problem is getting worse

The Oregon Department of Transportation is proposing to move forward with a multi-billion dollar series of highway expansion projects in the Portland metropolitan area, including the $5 billion Interstate Bridge Replacement project, the $1.45 billion Rose Quarter freeway widening project, the likely $1 billion I-205/Abernethy Bridge/I-205 widening project and an as yet un-priced Boone Bridge project.  Collectively, these projects would be by far the most expensive infrastructure investment in department’s history.  But the quoted prices for each project are just the tip of a looming financial iceberg.

A quick look at the agency’s history shows that it has invariably grossly underestimated the actual cost of the major projects it has undertaken in the past two decades.  Using data from ODOT’s own records and other public reports, we’ve compiled data on the initial project costs estimates (those quoted before construction commenced) and compared them with the latest estimates (either the actual final amount of spending in the case of completed projects, or the latest cost estimates for projects that have not yet been finished).  In every case, the ultimate price of a project was more than double the initial cost estimate.

This is important because ODOT is asking for permission to undertake a series of highway expansion projects, which, once started, will create a huge financial liability for the state of Oregon.  For three projects (the I-5 Bridge Replacement, the Rose Quarter and the Abernethy Bridge I-205 widening), ODOT is planning to sell toll-backed bonds to pay for part of project costs.  But if toll revenues are insufficient to pay bonds, or if costs escalate beyond current estimates, the state is fully liable to repay all these costs, and debt service on bonds, and these payments will take precedence over all other expenditures from state and federal transportation funds.  The failure to accurately forecast project costs for Portland freeway expansions, coupled with an unavoidable obligation to repay bondholders means that all other state transportation priorities, including even routine maintenance, would be in jeopardy.

Here is a closer look at seven major ODOT construction projects undertaken in the past twenty years.  Every one has experienced enormous cost overruns.

The Interstate 5 Rose Quarter Freeway project would widen a 1.5 mile stretch of freeway in Portland and was originally represented to the 2017 Oregon Legislature as costing $450 million. The latest estimates from the Oregon Department of Transportation are that the project could cost as much as $1.45 billion.   

The Legislature directed ODOT to prepare a “cost to complete” report for the I-205 Abernethy Bridge project.  The bridge connects Oregon City and West Linn, and would be widened and seismically strengthened.  ODOT’s 2018 report said the bridge would cost $248 million.  When the agency put the project out to bid in 2022, the actual cost came in at $495 million–essentially double ODOT’s estimate.

ODOT estimated the 5 mile long Highway 20 Pioneer Mountain-Eddyville project would cost $110 million when the project completed its environmental reviews in 2003 (Federal Highway Administration and Oregon Department of Transportation. (2003). Pioneer Mountain to Eddyville US 20, Lincoln County, Oregon, Draft Environmental Impact Statement, Executive Summary).  After years of delay, and including a design-build contractor withdrawing from the project, and ODOT having to demolish bridge structures and redesign significant parts of the project, its total cost was $360 million.

 

The Newberg-Dundee Bypass has been under consideration for almost two decades; a portion of the project was completed five years ago.  The initial estimate of the project’s total cost was $222 million (Oregon Department of Transportation. (2005). Newberg-Dundee Transportation Improvement Project Location (Tier 1) Final Environmental Impact Statement (News Release 06-132-R2).  The latest estimate of the cost of completing that full bypass project is now $752 million (Federal Highway Administration and Oregon Department of Transportation. (2010). Newberg Dundee Bypass, Tier 2 Draft Environmental Impact Statement (FHWA-OR-EIS-10-0-1D). Salem: Oregon Department of Transportation.

In 2002, the Oregon Department of Transportation told the City of Portland that rebuilding the Grand Avenue Viaduct (Highway 99E) in Southeast Portland would cost about $31.2 million (Leeson, Fred, “Council Backs Long Bridge in Viaduct’s Spot”  Portland Oregonian, July 19, 2002) .  The project was completed seven years at a total cost almost three times higher:  $91.8 million (ODOT, ARRA Project Data for ODOTas of 8/31/2010) .

When proposed in 1999, it was estimated that the I-5 South Medford Interchange would cost about $30 million  (Rogue Valley Area Commision on Transportation meeting notes, September 13, 2005).   In 2013, after the project was completed the agency said the cost was $96 million.

 

The original cost estimate for the I-5 Woodburn interchange project was $25 million in 2006 (FHWA & ODOT, Woodburn Interchange Project, Revised Environmental Assessment, November 2006).  The completed price was $68 million.

It’s always possible to make excuses for cost-overruns on any single project.  And if cost-overruns had happened only once, or maybe twice, it might make sense to dismiss them as aberrations.  But as the record of these seven projects makes abundantly clear, major ODOT highway projects almost invariably ending up costing twice as much as the original price quoted at the time the project is approved.  Cost overruns are a systematic and predictable feature of ODOT’s approach to highway building, not an aberrant bug.

No Accountability for Cost Overruns

In an attempt to quell concerns about the ODOT’s managerial competence, in 2015, Governor Kate Brown directed that the agency hire an outside auditor to examine its performance.  ODOT did nothing for the first five months of 2016, and said the project would cost as much as half a million dollars. Initially, ODOT awarded a $350,000 oversight contract to an insider, who as it turns out, was angling for then-ODOT director Matt Garrett’s job.  After this conflict-of-interest was exposed, the department rescinded the contract in instead gave a million dollar contract to McKinsey & Co, (so without irony, ODOT had at least a 100 percent cost overrun on the contract to perform their audit.)

McKinsey’s work consisted mostly of interviews with agency-identified “stakeholders” and a superficial analysis of ODOT date.  Its report focused on largely meaningless or trivial indicators such as “average time needed to process purchase orders.”  One part of the report purportedly addressed the agency’s ability to bring projects on time and under budget.  McKinsey presented this graphic, showing the variation between initial and finished costs for a series of mostly small projects.

There’s a striking omission, as revealed in the fine-print footnote:  McKinsey excluded data for the Highway 20 Pioneer Mountain Eddyville project.  This project, the single most expensive project that ODOT had undertaken, had a 300 percent cost-overrun, which the McKinsey report both failed to report correctly and which it described  as “performed 27 percent higher.”

The Oregon Department of Transportation doesn’t accurately forecast the cost of its projects, and refuses to be held accountable for a consistent pattern of errors.  Relying on ODOT’s cost estimates exposes the state to enormous financial risk, something that is likely to be magnified as the department moves ahead relentlessly with plans for billions of dollars of freeway expansion projects in the Portland area.

 

 

How ODOT & WSDOT are hiding real plans for a 10- or 12-lane I-5 Bridge Project

Ignore the false claims that the Oregon and Washington highway departments are making about the number of lanes on their proposed I-5 project:  its footprint will be 164 feet—easily enough for a 10- or 12-lane roadway.

This commentary was originally published at Bike Portland, and is re-published here with permission.

If you followed Tuesday’s Portland City Council work session or have been reading press reports about the Interstate Bridge Replacement project, you’ve probably noticed claims that the size of the project has somehow been reduced to adding “just one auxiliary lane” in each direction to I-5. The implication is that they’re only building enough capacity to expand the existing I-5 bridge from its current six lanes (three in each direction) to eight lanes (three plus a so-called “auxiliary” lane in each direction).

This claim is false.

A close look at the materials prepared by the Oregon and Washington departments of transportation shows they plan
to build a new I-5 bridge at least 164 feet wide — easily enough for ten or even twelve traffic lanes.

A close look at the materials prepared by the Oregon and Washington departments of transportation shows they plan to build a new I-5 bridge at least 164 feet wide — easily enough for ten or even twelve traffic lanes. While the glossy materials describing the project prominently talk about “one auxiliary lane” (in each direction), they almost completely omit a description of the actual width of the bridge. The IBR documents show only crude and misleading cartoon-like drawings of the bridge, without any actual measurements. That’s intentional: because they don’t really want you to know how wide a structure they’re planning.

But in a cryptic note in their presentation, they do refer to the width: The so-called ten lane bridge (two auxiliary lanes each direction) is said to have the same “footprint” as the 2013 Locally Preferred Alternative (LPA, a step in the federal NEPA review process). For the record, that footprint is 180 feet. For the so-called eight lane bridge (one auxiliary lane in each direction), the footprint is described as “2013 LPA Minus 16 Feet” which works out to 164 feet wide.

The broader context is this: the so-called “bridge replacement” is really a five-mile long, ten or twelve lane wide highway widening project that will cost $5 billion, and potentially a lot more.

ODOT’s actual plans for a 180′ wide CRC obtained by public records request.

This is a repetition of the false claim made for the preceding project — the failed Columbia River Crossing (CRC). In 2010, in response to objections from the City of Portland and Metro, ODOT and WSDOT announced they were reducing the size of the CRC bridge from 12 lanes to 10 lanes. But in reality, all they did was change the references in the project documents to that number of lanes, while literally erasing from the Final Environmental Impact Statement every single reference to the actual widths of the bridges and other structures they intended to build. A public records request showed the actual plans for the bridges — which were not published — were exactly the same size (180 feet in width) as they were for the 12-lane version of the bridge.

 

The limited materials released by the IBR project to date make it clear that they are engaged in exactly the same deception.

With standard-width 12 foot wide freeway lanes, this 164 foot wide bridge would accommodate ten traffic lanes (120 feet), with 11 foot shoulders on either side of the travel lanes, or as many as twelve travel lanes (144 feet) with five foot shoulders on either side of the twelve travel lanes). (Alternatively, the 164 foot width would allow construction of 12 travel lanes with 2 foot wide left shoulders and 8 foot wide right shoulders, which would be common, if not generous for an urban bridge.)

While they’re calling it an eight-lane bridge, it’s really a 10 or 12 lane bridge.

ODOT and WSDOT will no doubt say they’re “only” adding two lanes, and point to the supposed safety benefits of wider shoulders; but nothing prevents them, after building a 164-foot wide bridge, from coming back with a paint truck and re-striping it for ten or twelve lanes. In fact, they’ll claim that they can do that without any further environmental analysis under a “categorical exclusion” to the US DOT claims to the National Environmental Policy Act.

This isn’t an aberration or an accident, it’s an intentional strategy to evade environmental review: ODOT and WSDOT did this a decade ago on the failed Columbia River Crossing. It did the same thing with the I-5 Rose Quarter project, again claiming it was merely adding one auxiliary lane in each direction. Meanwhile its actual plans (which it kept secret and didn’t include in the Environmental Assessment) showed it planned to build the I-5 Rose Quarter project to be 160 feet wide, easily enough to accomodate 10 lanes of traffic.

The highway builders know — though they refuse to admit — that more lanes induce more traffic and more pollution. That’s why they’re engaging in this highly deceptive process of claiming they’re just adding a single “auxiliary” lane, when in fact, they’re engineering structures that can be repainted in a day to be vastly wider. This subterfuge enables them to claim minimal environmental impacts now, and then with no further review, create exactly the wider roadway they wanted all along.

Ten unanswered questions about the IBR Boondoggle

In the next month or two, regional leaders in Portland are going to be asked to approve the “modified locally preferred alternative” for the I-5 Bridge Replacement (IBR) Project, an intentionally misnamed, $5 billion, 5 mile long, 12-lane wide freeway widening project between Portland and Vancouver, Washington.

There’s a decided rush to judgment, with almost many of the most basic facts about the project being obscured, concealed, or ignored by the Oregon and Washington Departments of Transportation.  As with the failed Columbia River Crossing, they’re trying to pressure leaders into making a decision with incomplete information.  Here are ten questions that the IBR project has simply failed to answer.  We’ve offered our own insights on the real answers, but before the region’s leaders take another step, they should satisfy themselves that they know the real answers to each of these questions.

1. How much will it cost?

Conspicuously absent from IBR presentations is any clear statement of what the project is likely to cost.  Almost two years ago, the project released a warmed over version of the cost estimates from the Columbia River Crossing indicating the project could cost $4.8 billion.  But this estimate is based on an update of old CRC estimates, rather than a new, bottom-up cost estimate of the current project.  Already, the IBR team has decided to rebuild the North Portland Harbor bridge which will add an estimated $200 million to the project.  Moreover construction inflation has accelerated in recent months; bids for the Abernethy Bridge project in Portland came in almost 40 percent higher than forecast.  Similar cost overruns on the IBR would add more than $2 billion to the price tag.

Real Answer:  The IBR is likely to be a $5-7 billion project

2. Who will pay for it?

Also missing from the IBR presentation is a definitive statement of the sources of funds to pay for the project.  For starters–and just for starters–the project says Oregon and Washington will each be expected to contribute $1 billion.  There’s a considerable amount of vague hand-waving about federal support, but most federal money in the Infrastructure bill is allocated by formula, and comes to the two states whether they build this project or not; and so spending this money on the IBR, rather than fixing the multi-billion dollar backlog of other bridge repairs, comes at a real cost to the states.  What is clear is that a third or more of the IBR’s costs will have to be recouped by charging tolls to bridge users, and that the two states, and no one else, will be on the hook for any cost overruns and any revenue shortfalls.  And cost overruns are hardly conjecture:  The I-5 Rose Quarter Freeway widening project, estimated to cost $450 million five years ago, is now likely to cost as much as $1.45 billion according to ODOT.

Real answer:  Oregon and Washington have unlimited liability for project costs including cost overruns and toll revenue shortfalls.

3.  How high will tolls be?

IBR staff have said next to nothing about what level of tolls will be charged for bridge users.  Studies prepared for the Columbia River Crossing showed that tolls would have to be a minimum of $2.60 for off peak users and $3.25 for peak travel, plus surcharges for those who don’t buy transponders, which would push peak period car tolls over $5.00 each way.  Trucks would pay 5 times as much as cars, with peak period tolls topping $18.  Knowing what the toll levels will be is essential to understanding the economic impacts of the bridge, as well as accurately forecasting future traffic levels.  Experience in other states has shown that even an $1 or $2 toll could permanently reduce traffic to half of its current levels, eliminating the need to add any capacity to the I-5 crossing.  Before they move ahead with the project, shouldn’t the public and its leaders know how much will be charged in tolls?

Real answer:  Tolls will be $2-3 each way, and highest at peak hours, costing regular commuters more than $1,000 per year.

4  Will other bridges and highways be tolled to avoid gridlock?

If just the I-5 bridges are tolled, ODOT and WSDOTs own consultants predict that this will produce gridlock on I-205.  IBR staff have made vague statements claiming to have looked at tolling other roadways at the same time.  But unless parallel routes like the I-205 are also tolled, the traffic claims made for the IBR are simply invalid.  If the region is serious about tolling and avoiding gridlock, it needs to adopt a comprehensive tolling strategy before it commits to a multi-billion dollar freeway widening project.

Technical work done for the CRC project, reported on page one of the Oregonian in 2014, indicated that tolling I-5 would produce gridlock on I-5.  

Tolling will dramatically affect the traffic levels on I-5 and I-205.  The best evidence is that tolling the region’s freeways would virtually eliminate the need for additional capacity expansion.  ODOT’s own congestion pricing consultants showed that a comprehensive system of road pricing would eliminate most metro area traffic congestion, without the need to spend billions on added capacity.  We know from experience in other cities that tolling after adding capacity simply leads to wasting billions of dollars on roadways that aren’t used because travelers don’t value them.

Real Answer:  Unless we toll the I-205 bridge as well, the I-5 bridge will be under-utilized, and I-205 will have gridlock. The region needs to decide on a toll system before its squanders billions on un-need highway capacity, and goes deeply into debt to repay bonds for capacity that isn’t used.

5. What will it look like?

Despite spending more than two and a half years and tens of millions of dollars on designing the project, the IBR has yet to produce any renderings showing what the project would look like to human beings standing on the ground in Vancouver or on Hayden Island.  The bridge will be 150 feet tall as it crosses the Columbia River and will have lengthy approach ramps, and extensive elevated freeway sections over Vancouver and Hayden Island, with substantial visual and noise impacts.  But you would never know it from the project’s presentations, which if they show the bridge and freeway expansion at all, show it from an aerial view that could be seen only from flights over Portland International Airport.  The project’s presentation to a joint legislative committee in April contains no illustrations of what is to be built at all.

City Observatory has obtained, via public records request, the 3D models created by IBR to show the size and location of the proposed I-5 Bridge.  The following image shows what the proposed I-5 bridge would look like, compared to the existing bridge.  It would be dramatically taller and wider, and would loom over downtown Vancouver.  It’s relatively easy to produce images showing how the replacement bridge would affect Vancouver.  Why hasn’t the IBR with its extensive budget produced any such images?

Real Answer:  The I-5 replacement bridge and approaches will tower over downtown Vancouver and Hayden Island.

6. How long will the trains take?

A key part of the project is a plan to add light rail service between Portland’s Expo Center and downtown Vancouver.  The IBR project asserts that there will be huge demand for travel on light rail.  But light rail is relatively slow.  Unless light rail is faster than car travel or express buses, it’s unlikely to attract many riders.  Currently, Tri-Met’s Yellow line takes 29 minutes to get from the Expo Center to downtown Portland.  The CRC FEIS projected that it would take light rail trains about 6 minutes to get from Mill Plain Boulevard across a new I-5 bridge to the Expo Center; together this means it will take at least 35 minutes via light rail to reach downtown Portland from Vancouver.  That’s more than 10 minutes longer than it takes current C-Tran express buses, traveling in morning, peak hour traffic, to travel between 15th and Broadway in Vancouver to SW 5th and Alder in Portland—a 7:56 AM bus leaving Vancouver reaches downtown Portland at 8:20.  Also:  with added capacity on I-5 and tolling of I-5, future express buses would travel even faster than they do today, so light rail would likely be at an even greater time disadvantage than it is now.  The information provided by the IBR contains no explanation of how a slower train is going to attract more riders than a faster bus or why BRT would perform worse than LRT in this corridor.

Real Answer:  The LRT extension to Vancouver will be considerably slower than today’s buses.

7. How can traffic models predict more no-build traffic on a bridge that is already at capacity?

The I-5 bridges reached capacity almost two decades ago, and can’t handle additional traffic, but ODOT’s model apparently predicts that traffic will continue to grow across the bride even though there’s no capacity.  This is a classic example of a broken model that in the words of national modeling expert Norm Marshall “forecasts the impossible.”  ODOT’s own consultants, CDM Smith, said in 2013 that the I-5 bridge could handle no more peak traffic due to capacity constraints:

Traffic under the existing toll-free operating condition on the I-5 bridge reached nominal capacity several years ago, especially considering the substandard widths of lanes and shoulders on the facility. The I-5 bridge has little or no room for additional growth in most peak periods, and capacity constraints have limited growth over the last decade.

The IBR’s own modelers admitted that traffic growth on I-5 has been limited due to the bridge being at capacity and congested.  Yet they’ve created a fictitious “no build” scenario in which traffic continues to increase, essentially because it has no meaningful feedback loops to adjust travel demand to reflect how humans actually respond in the face of congestion.

Real Answer:  ODOT is using flawed models that overstate no-build traffic and pollution, and conceal the true environmental impact of freeway expansion

8. How wide will the bridges be?

The IBR team describes the I-5 Bridges adding either two or four so-called “auxiliary lanes” to the existing six freeway lanes on I-5 through the project area.  But the project hasn’t revealed how wide the structures are that its actually building.  In the project’s last iteration, the “Columbia River Crossing”, the project said they reduced the size of the bridge from twelve lanes to ten in response to objections to its width from local leaders, but in fact, public records requests showed that they didn’t reduce the physical size of the bridges (or other structures) at all.  The supposed “ten lane” bridge was 180 feet wide, just as was the proposed “twelve lane” bridge.

The cryptic information provided by the IBR says that its so-called 10-lane bridge would be just as wide as the CRC (180 feet), and the so-called 8 lane bridge (“one auxiliary lane”) would be just 16 feet narrower (“2013 LPA Minus 16 Feet”), which works out to 164 feet wide.  With standard-width 12 foot wide freeway lanes, this 164 foot wide bridge would accommodate ten traffic lanes (120 feet), with 11 foot shoulders on either side of the travel lanes, or as many as twelve travel lanes (144 feet) with five foot shoulders on either side of the twelve travel lanes).  (Alternatively, the 164 foot width would allow construction of 12 travel lanes with 2 foot wide left shoulders and 8 foot wide right shoulders, which would be common, if not generous for an urban bridge).

When it comes to bridges or freeway capacity, ignore how many “lanes” ODOT and WSDOT claim they’re building, and look at how wide the structures are.  They’ve repeatedly used this deceptive tactic to intentionally conceal the true width and environmental impact of their projects.

Real Answer:  Regardless of how many lanes IBR claims its building, its actual plans provide capacity for more, in this case a 10 or 12 lane bridge.

9. How many cars will use the bridge?

The primary argument for the IBR is that it is needed to carry a growing number of vehicles crossing the Columbia River.  But completely absent from any of the project’s materials is any specification the volume of traffic the bridge will carry.  The project makes claims about travel times and traffic delay, but can’t possibly have come up with those estimates without coming up with estimates of the number of cars that will use the bridge.  It specifically suppressed this information to undercut the public’s ability to understand–and ask questions about and criticize the modeling.  And we know that the project’s earlier modeling done for the Columbia River Crossing was simply wrong.  It predicted that traffic would grow by 1.7 percent per year on I-5 between 2005 and 2030; in fact, through 2019, traffic grew by only 0.3 percent per year.   This chart shows the average daily traffic on I-5 as predicted by the CRC (blue: no-build, red build) and actual, from ODOT’s own traffic records (black).  We can’t see how IBR’s new modeling compares to these figures, because they’ve simply refused to publish any average daily traffic totals.

The models used by IBR systematically over-estimate travel in the No-build scenario and underestimate, if not completely ignore, the additional traffic induced by adding more lanes.  It’s impossible to assess the project’s claims about traffic performance, environmental impacts, or financial viability with out transparent and accurate estimates of the number of vehicles that will use the bridge.

Real Answer:  IBR uses flawed models which overstate the need for freeway capacity to justify un-needed and expensive freeway widening.

10. How will a wider freeway reduce carbon emissions?

The IBR material makes the specious claim that it will result in lower emissions, based on the false claim that decreasing traffic congestion will reduce vehicle idling in traffic, and that the bridge will have a higher share of transit passengers (something which it cannot explain–see #6 above).  The RMI Shift induced travel calculator estimates that adding lanes to the I-5 bridge could increase greenhouse gas emissions hundreds of thousands of tons per year.

Real Answer:  Expanded freeway capacity leads to more driving and more greenhouse gas emissions.

Sprawl and Tax Evasion: Driving forces behind freeway widening

Sprawl and tax evasion are the real forces fueling the demand for wider freeways

Highway widening advocates offer up a  a kind of manifest destiny storyline: population and traffic are ever-increasing, and unless we accommodate them we’ll be awash in cars, traffic and gridlock.  The rising tide of cars is treated as a irresistible force of nature.  But is it?  Look more closely and its apparent that rising traffic levels aren’t inevitable, they’re the product of other forces.  And far from solving traffic problems, widening roads makes these problems worse.

In the case of Portland’s proposed $5 billion 5-mile long freeway widening project—the mis-named Interstate Bridge Replacement project—the real forces behind the project aren’t pre-destined levels of car traffic, but instead, are much more prosaic, and questionable:  sprawl and tax evasion.

Sprawl:  Cause and consequence of wider roads

While Oregon has some of the tightest land use controls in the nation, Washington State is still far more accommodating to rural and exurban residential development.  As many critics of the I-5 bridge project have noted, precious few commuters from Washington State to jobs in Oregon use transit, despite the fact that their are good express bus services from Vancouver to Oregon job centers.  (Prior to the pandemic, express buses carried only about 3,000 people per weekday between Oregon and Washington, compared to more than 250,000 vehicles per day crossing the river). A key reason for this auto-dominated travel pattern is that housing growth in Clark County has been driven by exurban sprawl, and workers commuting from these locations travel overwhelmingly by car.  Here’s a map prepared by Seattle’s Sightline Institute showing the comparative patterns of population growth in the Oregon and Washington portions of the metropolitan area between 1990 and 2000.  While Oregon has had little population growth outside its urban growth boundary–a testament to the policies effectiveness–Washington has experienced a rash of exurban development.

Sightline Institute

This exurban sprawl is both the source of demands for expanded highway capacity on I-5 and elsewhere, and in turn, widening roads simply encourage more such sprawl—a pattern that is repeated in metropolitan areas across the country.  The technical analysis done for the proposed Columbia River Crossing (predecessor of the IBR) estimated that 93 percent of the growth in peak hour trips on I-5 between 2005 and 2030 would result from additional population growth in the suburban fringe of Clark County (i.e. even more purple dots).

Tax evasion fuels traffic growth

While sprawl is one contributor to traffic growth, a second is tax evasion.  Here’s the short story:  Oregon has no retail sales tax; Washington charges its residents one of the nation’s highest rates (over 8 percent).  As a result, Washington residents regularly drive across the Columbia River on one of two Interstate Bridges to shop tax-free in Oregon.  They spend over $1.5 billion per year in Oregon, and effectively evade more than $120 million in sales taxes by doing so.  The average Clark County family of four evades about $1,000 of sales tax each year.

But all these sales tax evasion produces a lot of traffic on the two bridges that cross state lines:  We estimate that between 10 and 20 percent of all the trips crossing the I-5 and I-205 Columbia River bridges are Southwest Washington households driving to shopping centers in Oregon to evade Washington sales tax.  Conveniently, there are major shopping centers at Jantzen Beach and Hayden Meadows (on I-5) and on Airport Way (I-205), both just across the Columbia River into Oregon.   The parking lots of these retail centers are chock-a-block with Washington vehicles.

Jantzen Beach Home Depot parking lot (City Observatory)

Far from being inexorable and inevitable forces of nature, the factors driving the growth of traffic between Portland and Vancouver are actually symbolic of dysfunctional and environmentally destructive trends.  Rather than accommodating them, and encouraging more sprawl and tax evasion, we should be making choices that are consistent with our stated values.

A Universal Basic income . . . for Cars

California is the first in the nation to establish a Universal Basic Income . . . for cars

One of the most widely discussed alternatives for tackling poverty and inequality head-on is the idea of a “Universal Basic Income”—a payment made to every household to assure it has enough for basic living expenses.  While there have been a few experiments and a lot of political hyperbole, it hasn’t really been tried at scale.  But now, California is on the verge of enacting a Universal Basic Income, but instead of being for people, it’s for cars.

It’s a symptom of our deep car dependence thant faced with somewhat higher gas prices (still lower, in inflation-adjusted terms than a decade ago), politicians are falling all over themselves to insulate cars and driving from their real costs.  It speaks volumes that we’re so quick to allocate resources to cars and so reticent to have similar energy when it comes to tackling poverty.

High gas prices are a potent political issue for car-dependent Americans, and that’s prompted elected officials to scramble to come up with ways to ease the pain.  California Governor Gavin Newsom has proposed giving California car-owners a $400 debit card for each car they own, at a total cost of an estimated $9 billion.  It’s effectively a universal basic income (UBI), but for cars.

In an ironic parallel, the City of Oakland is reporting the results of its own recent experiment with a kind of UBI for transportation.  Oakland gave $500 households $300 debit cards that they could spend on a range of transportation services, like bus travel, bikes, scooters and ride-hailed trips.  They then surveyed participants to see how their travel patterns changed.  Overall, about 40 percent of participating households reported reducing their single occupancy car trips.  The idea of a flexible transportation allowance is great way to directly address the equity concerns of our transportation system, especially as we begin using road pricing as a way to make the transportation system function more efficiently.  But it’s striking that while a universal basic mobility allowance merits only a tiny and tentative $150,000 experiment, a universal car allowance worth nearly $10 billion is likely to move forward with little, if any consideration of its social and environmental effects.

Other states have taken a different approach to reducing transport costs, with a similar car bias.  New York Governor Kathy Hochul is proposing a gas tax holiday (which may or may not save motorists money, depending on whether oil companies pass along the savings to customers).  Of course, the cost of paying for maintaining the state’s roads will just be shifted to others, so the savings mostly an illusion.

There’s a good argument that Newsom’s debit cards directly undermine the state’s climate goals, especially by handing out money based on the number of cars a household owns. Both the California and New York plans give fiscal relief to car owners.   You have to own a car to get a California debit cards, and somewhat perversely, households with two cars (who tend to have higher incomes) get twice as much relief as families with a single car.   But the incentive effects of the tax cut are even worse than California’s debit card approach:  people will save in proportion to how much gas they buy.  Those who don’t drive much, drive fuel efficient vehicles, or who don’t own or drive cars at all, will get no relief.  The big winners will be those who own fuel inefficient vehicles and drive a lot.  At least with the California debit card approach, families don’t have to buy more gasoline to get more relief.  They can spend the $400 on anything else they like, including for example, a bus pass or part of the purchase price of a new bike.

Gas tax holidays and California’s universal basic income policy for cars are emblematic of the fundamental inequity of our current transportation policy.  Measures, like a universal basic mobility allowance, which would help those most in need and incentivize more sustainable transportation are subject to protracted experimentation at trivial scale.  Meanwhile, rising gas prices prompt sweeping and ill-considered policies that will send most benefits to those who drive the most, and which will further incentivize more driving and environmental destruction.

Flying blind: Why public leaders need an investment grade analysis

Portland and Oregon leaders shouldn’t commit to a $5 billion project without an investment grade analysis (IGA) of toll revenues

Not preparing an IGA exposes the state to huge financial risk: It will have to make up toll revenue shortfalls, 

The difference between an IGA and ODOT forecasts is huge:  half the traffic, double the toll rate.

There’s no reason to delay preparing the investment grade analysis:  The federal government and financial markets require it, and all of the needed information is available

If you don’t prepare an IGA before making a commitment to this project, you are flying blind

 

Portland are a leaders are being asked to greenlight the so-called Interstate Bridge Replacement Project, which is projected by its proponents to cost as much as $5 billion.  But they’re being asked to give a project a go-ahead with only the sketchiest financial information.  The project’s cost estimates are slightly warmed over versions of decade old estimates prepared for the failed Columbia River Crossing.  Ominously, the details of where the money will come from—who will pay and how much—are superficial and vague.

One thing project advocates grudgingly admit is that the I-5 bridge replacement can’t be financed without tolls.  Program administrator Greg Johnson and Oregon Transportation Commission Chair Bob Van Brocklin have repeatedly said as much.  But how much money tolls will produce and how high tolls will be are never clearly mentioned.  Johnson has said tolls will provide “about a third of project costs.”

Knowing how much money tolls will produce, and how high tolls will have to be to produce that revenue is the central financial question.

Currently the I-5 bridge carries about 130,000 vehicles per day.  But that volume is predicated on the bridge being free.  Charging people to use the bridge would dramatically reduce the number of crossings.  As we’ve documented at City Observatory, when tolls were added to a similar crossing, the I-65 bridges across the Ohio River in Louisville, traffic levels fell by half.

Because tolling depresses traffic, you can’t accurately estimate how much toll revenue a bridge will produce without a detailed model that accounts for this traffic depressing effect.

The models routinely used by state highway departments don’t accurately account for the effect of tolling on traffic volumes.  They tend to dramatically over-predict the amount of traffic on tolled roadways, which has led to over-built facilities that don’t generate enough toll-paying traffic to cover their costs.

Financial markets and the federal government, who are asked to loan money up-front (with a promise to be repaid by future tolls) simply refuse to believe state highway department traffic forecasts.  Instead, they insist that states pay for an “investment grade” traffic and revenue forecast.  You can’t sell toll-backed bonds on private financial markets, and you can’t even apply for federal TIFIA loans, without first getting an investment grade forecast.  In January, Portland’s Metro Council adopted a statement of Values, Outcomes and Actions governing the I-5 project, directing the Oregon Department of Transportation to prepare an Investment Grade Analysis of the project:

As the part of the finance plan, engage professionals with expertise in financing massive complex transportation infrastructure construction projects to conduct and deliver the results of an investment-grade traffic and revenue study of the design options.

That’s a critical step to making and informed decision.

What is an investment grade analysis?

Investment grade forecasts are generally prepared by one of a handful of financial consulting firms.  These studies start with the traffic models used by state highway departments, but make much more realistic assumptions about future population and employment growth, the likelihood of economic cycles, and critically, the effect of tolling on levels of traffic.  As a result, investment grade analyses invariably predict lower levels of traffic that the models used by state highway departments.  Because traffic levels are lower, tolls have to be higher to produce any given amount of revenue.

And the differences between investment grade analysis and highway department forecasts are not trivial:  they are huge.  The Oregon and Washington highway departments prepared traffic and toll estimates for the Columbia River Crossing’s Final Environmental Impact Statement published in 2011.  Those estimates were that the I-5 bridges would carry 178,000 vehicles per day in 2030, and that minimum tolls would be $1.34 to pay for about one-third of the cost of the project.  The Investment Grade Analysis for this project, prepared by CDM Smith on behalf of the two agencies in 2013 estimated that in 2030, the I-5 bridges would carry just 95,000 vehicles per day in 2030, and that tolls would be a minimum of $2.60 each way in order to cover a third of project costs.  In short, the initial highway department estimates overstated future traffic levels by double, and understated needed tolls by half.

The starkly different figures in the investment grade analysis called into question the size of the project, which was predicated on the exaggerated highway department forecasts.  If a tolled bridge would carry dramatically fewer vehicles than the existing bridge, there was no justification for building an expensive wider structure and approaches.  The money spent expanding capacity on the bridge would be wasted because fewer vehicles would use it.  Also, the dramatically different traffic figures also meant that the environmental analysis contained in the FEIS was simply wrong.

Investment Grade Analyses are required for financial prudence

The reason that the federal government and financial markets insist on the preparation of an investment grade analysis is so that they don’t get stuck holding the bag when traffic levels, and toll revenues fall short of the excessively optimistic expectations of state highway departments.  Around the county dozens of toll roads and bridges have failed to produce expected revenues, leading to delinquencies, defaults, and bankruptcies.

If anything, state lawmakers have an even larger financial stake in the IBR project than do financial markets or the federal government.  Financial markets, for example, will insist on additional state guarantees, besides repayment just from the stream of toll revenues.  They’ll require states to pledge other revenues to repay bonds, in addition to insisting on the investment grade analysis.  The 2021 Oregon Legislature passed HB 3055, which authorizes ODOT to pledge state gas tax revenues and future federal grant monies to repay holders of state-issued toll bonds.

Because the state is ultimately liable for any toll-revenue shortfalls, it has an even higher stake than private lenders or the federal government  in knowing the true level of future toll revenues as would be disclosed in an investment grade analysis.

Why ODOT doesn’t want the public to see the IGA first

ODOT and WSDOT are greatly resisting calls to prepare an investment grade analysis.  Their current project schedule doesn’t call for conducting the analysis until 2024 or 2025–well after the design of the bridge is settled and too late to consider a smaller or cheaper alternative.  The highway departments variously claim that its “too expensive” or “premature” to carry out the IGA.

There’s no technical reason it can’t be prepared now.  The base transportation data have been gathered, and the regional model exists.  The agencies say the IGA is expensive, but it’s far less costly than what the agency has spent already on public relations, and the money has to be spent anyhow.  And the IGA will continue to be valid for several years—and can easily be updated once it is complete, if that becomes necessary.  You can’t save any money by delaying.  The only real reason to put off preparing an IGA is because it will show that the IBR will carry vastly less traffic than the DOTs predict, and that tolls will have to be much higher than they’re implying.  In short, the DOTs don’t want the IGA because it will present a definitive case against the over-sized project that they’re building.  Financial markets and the Federal government will insist on the IGA before they make their decision:  the only ones being denied access to this vital financial information are local leaders and state lawmakers who will have to pay for the project.  According to DOT plans, they’ll find out the results of the IGA only after it’s too late to do any good.

Their plan is clearly to convince local and state leaders  irrevocably commit to the construction of a much larger project than could possibly be  justified it anyone saw the results of the investment grade analysis.  It’s obvious from the project’s unwillingness to do anything other than advance a single alternative (a 164-foot wide bridge, enough for ten or twelve lanes of traffic) into the next environmental analysis, that they don’t want the results of an investment grade analysis to undercut their contrived case for a massive structure.

State Highway Department Forecasts are Flawed

As we’ve written before, the IBR project is a scene-for-scene remake of the Columbia River Crossing debacle. Just as they are doing now, the state highway departments published grossly inflated traffic forecasts.  In 2010, the Oregon State Treasurer hired Rob Bain, an internationally recognized expert on toll revenue financing, and author of “Toll Road Traffic and Revenue Forecasts: An Interpreters Guide” to assist in the financial analysis of the CRC.   He found numerous flaws and biases–which prompted calls for the investment grade analysis that produced dramatically different results than the highway department projects.  Specifically, Bain reviewed the CRC traffic and revenue forecasts prepared for the project’s environmental impact statement on behalf of the Oregon State Treasurer.  He stated:

  • The traffic and revenue (T&R) reports fall short when compared with typical ‘investment grade’ traffic studies. As they stand they are not suitable for an audience focussed on detailed financial or credit analysis.
  • The traffic modelling activities described in the reports are confusing and much of the work now appears to be dated. Although a number of the technical approaches described appear to be reasonable, many of the modelling-related activities seem to ‘look backwards’; justifying model inputs and outputs produced some years ago. There is a clear need for a new, updated, forward-looking, comprehensive, ‘investment grade’ traffic and revenue study.
  • No mention is made in the reports of historical traffic patterns in the area or volumes using the bridges. This is a strange omission. Traffic forecasts need to be placed in the context of what has happened in the past. If there is a disconnect (between the past and the future) – as appears to be the case here – a commentary should be provided which takes the reader from the past, through any transition period, to the future. No such commentary is provided in the material reviewed to date.
  • Traffic volumes using the I-5 Bridge have flattened-off over the last 15-20 years; well before the current recessionary period. . . . the flattening-off is a long-term traffic trend; not simply a manifestation of recent circumstances. The CAGR for the period 1999 – 2006 reduces to 0.6%

An investment grade analysis is the bare minimum that’s needed to make a responsible and informed decision about a multi-billion dollar project.  The only reason not to ask these questions now, and to get clear answers, is because the two state DOTs know that the financial risks will prompt legislators and the public to seriously question this massive boondoggle.

A note on nomenclature:  Level I, Level 2, Level 3

Highway departments frequently label traffic forecasts as being one of three levels, ranging from a rough sketch level (Level 1), to a somewhat more detailed Level 2, and up to the financial gold standard, Level 3, an investment grade analysis.  As noted, neither the federal government nor private bond markets will make loans based on Level 1 or Level 2 studies:  they are inadequate to accurately forecast traffic for making financial decisions.  This chart from Penn State University describes the general differences between these three levels of analysis:

Editor’s Note:  Nomenclature section added August 4, 2022

Which metros are vulnerable to gas price hikes?

Green cities will be less hurt by higher gas prices; Sprawling cities are much more vulnerable to gas price hikes.

In sprawling metros like Atlanta, Dallas, Orlando, Nashville and Oklahoma City, higher gas prices will cost the average household twice as much as households living in compact metros like San Francisco, Boston, Portland and Seattle.

Rising gas prices are a pain, but they hurt most if you live in a sprawling metro where you have to drive long distances to work, shopping, schools and social activities.  Some US metros are far less vulnerable to the negative effects of rising gas prices because they have dense neighborhoods, compact urban development, good transit, and bikeable, walkable streets.  Among the 50 largest metro areas, the best performers enable their residents to drive less than half as much as the most car-dependent metros.  Those who live in metro areas where you have to drive, on average, 50 miles or more per day (places like Oklahoma City, Nashville and Jacksonville) will be hit twice as hard by higher fuel prices than the typical household living in a place like San Francisco, Boston or Portland, where people drive, on average, fewer than 25 miles per day.  When gas prices go up, it’s easy being green:  These compact, less car-dependent metros and their residents, will experience far less economic dislocation than metros where long daily car trips are built-in to urban form.

Gasoline prices have shot up in recent days, thanks to the Russian invasion of Ukraine.   A year ago, average gas prices nationally were under $3 gallon.  In February, they averaged around $3.30 per gallon.  After the Russian invasion began, oil prices and gas prices jumped.  On March 14, the national average was $4.30, and rising rapidly, with much higher prices in some markets.

There’s the usual barrage of media hand-wringing about the impact of high gas prices, notwithstanding the widespread support for backing Ukraine, even if it means higher oil prices.  Some 71 percent of Americans favored banning Russian oil imports even at the cost of higher gas prices.  As high as they seem, gas prices today are just now approaching the levels recorded in 2008, when gas prices peaked at $5.09 per gallon (in 2022 dollars).

In our largely car-dependent nation, higher gas prices feel painful, but some Americans feel the pain far more deeply than others, and some feel it not at all.  There’s been more than a little bike advocate schadenfreude on Twitter, pointing out that those who travel by bike or on foot aren’t feeling the pain of higher gas prices.

But this isn’t just about individual choices and behavior:  whole communities can be more or less vulnerable to gas price shocks, depending on how much land use patterns effectively necessitate driving.

Some metro areas are vastly more car-dependent than others, and as a result, are more vulnerable to gas price hikes.  We can get a good idea of which metros will be most affected by price hikes by looking at data on average travel distances in different cities.  The big data firm Streetlight Data published its estimates of the amount of daily driving per person for large US metros.  We’ve tabulated their publicly released data for the period just before the advent of the Coronavirus pandemic, to get a reasonable baseline for comparing travel patterns.

On average, the residents of the typical large metro area in the US drive about 30 miles per person per day (that’s a bit higher estimate than the one provided by the US Department of Transportation).  But there are extremely wide variations in average driving among metro areas.  In general, older, denser metros with more extensive transit systems seem to have dramatically less driving per person than newer, sprawling Sunbelt metros with weak transit.

The metros least likely to feel the pain of higher gas prices include Buffalo, San Francisco, Boston, New York, Portland and Seattle, where metro residents drive about 25 percent less than average.

On the other hand, the metros most vulnerable to higher gas prices are those where, due to job and population sprawl, people tend to drive much further.  These highly vulnerable metros include Oklahoma City, Orlando, Nashville, Dallas, Charlotte and Atlanta, where the typical resident drives 50 or more miles per day, according to the Streetlight estimates, nearly double the typical metro area.

Average Miles Driven Per Person Per Day Prior to Covid-21 Pandemic (Streetlight Data)

 

As we’ve pointed out before, residents of more compact metro areas, with better transit and closer destinations earn the equivalent of a huge green dividend, even when gas is cheap, because they spend far less on cars and gasoline.  Meanwhile, their counterparts in decentralized metros pay a “sprawl tax.”  When oil prices rise, the pain falls disproportionately on those who live in metros where they have to drive a lot.

The differences are significant.  The households living in metros where people drive 50 miles per person per day are conservatively buying twice as much fuel as those living in metros where people drive only 25 miles per day.  So while a family in a compact metro area would be buying say 100 gallons or so of fuel a month, its counterpart in a sprawling metro would be buying 200 gallons.  So a $1 increase in the price of gas would hit about $1,200 harder over the course of a year in a sprawling metro than in a compact one.

In the face of rising fuel prices—whether from a war, or from the the long overdue need to reflect the true social and environmental costs associated with fossil fuels—communities where people don’t have to drive as much, or drive as far, have a real economic advantage over more car-dependent places.  That’s a consideration that ought to play a larger role in local, state and national policies going forward.

 

 

 

Oregon crosses the road-pricing Rubicon

Starting this spring, motorists will pay a $2 toll to drive Oregon’s historical Columbia River Gorge Highway.

Instead of widening the road, ODOT will use pricing to limit demand

This shows Oregon can quickly implement road pricing on existing roads under current law:  No EIS, No equity analysis

If you can do it there, why not anywhere?  It’s up to you ODOT.

The Columbia River Gorge, just east of Portland, is one of the nation’s scenic wonders. It was formed where the Columbia River cut a path through the volcanic Cascade Mountain Range, and consists of 50 miles of spectacular river views framed by soaring bluffs, green forests and snow-capped peaks. It’s also home to one of the nation’s oldest and most scenic highways, the Columbia Gorge Highway, built in between 1913 and 1922. It was a kind of engineering marvel of its time, crafting and sometimes carving a winding two-lane roadway along the river and into the cliffs of the Gorge.

In the 1960s the old highway was fully replaced by the construction of Interstate 84, but the old road has been maintained and in places restored because of its scenic beauty, and direct access to waterfalls and hiking trails. Less than an hour from Portland, it’s a major tourist and recreational site; Multnomah Falls is the state’s most-visited tourist destination.  And that’s become a problem.

On any summer day, or any (somewhat dry) weekend, you’ll find visitors flocking by the thousands to drive the old scenic highway, particularly the stretch between Vista House and Multnomah Falls, which offers a series of postcard views. (This stretch of roadway is also routinely used for filming car commercials).

In recent years, however, traffic has overwhelmed the old highway. The road itself is narrow and winding, and there’s little parking at the parks, waterfalls and trailheads. With great regularity, the highway itself has been jammed, and cars are stopped and idling in front of Multnomah Falls. The traffic is both unsafe and also mars the natural beauty of the location.

KATU

Into this fray has stepped the Oregon Department of Transportation. Thankfully, they’re not doing what they usually do, which is proposing to widen the roadway to accommodate even more traffic. Instead, for the first time, they’re implementing a permit system to ration the flow of cars on the old highway to levels that it can accomodate without destroying the experience for those seeking to see one of Oregon’s most beautiful spots.

Starting the week before Memorial Day, and until Labor Day, you’ll need to buy a permit in order to travel on the waterfall-dotted portion of the Columbia River Highway.  As Oregon Public Broadcasting reports, this will be a “peak hour” pricing program:

The permit will be required for the approximately 14-mile stretch between Vista House and Ainsworth State Park from 9 a.m. to 6 p.m. ODOT is still deciding how many permits to allow per day, as the permits do not guarantee parking.

Let’s be clear: What they’re doing is taking an existing road, and they’re tolling it: imposing limits on how many vehicles can use it so that it works better. This is a huge policy breakthrough for a department that has never seriously done anything to moderate traffic demand. (It’s strongest effort to date has been funding for half-hearted public relations campaigns that gently imply that people might want to drive less).

ODOT is planning to charge $2.00 for these permits.  This will mostly just recoup their direct administrative costs. But if they do it right, it won’t take much of a fee to bring traffic levels down. Just requiring a permit will force people to plan ahead, and will keep people from overwhelming the Gorge on a sunny early spring weekend day. And the fees levied for these permits could be used to expand ODOT’s existing bus service “Columbia Gorge Express” which provides rides to key Gorge destinations. Getting more visitors on buses will reduce traffic and pollution in the Gorge.

Crossing the Rubicon:  The Gorge Highway toll shows ODOT can implement road pricing quickly if it wants to.

For more than a decade, ODOT has been dragging its bureaucratic feet in implementing road pricing.  The 2009 Legislature instructed the agency to run a test of pricing in the Portland area; instead the agency counted a special game-day street parking surcharge near the Timber’s soccer stadium as its “pricing” plan.  The 2017 Legislature directed ODOT to implement pricing on Portland’s two major freeways (I-5 and I-205); so far, they’re still just working on the planning.

The agency has argued that it has to undertake extensive environmental reviews, that it must consult widely about the potential equity implications of pricing, and that it would be unprecedented (and somehow unfair) to extend pricing to an existing roadway.  All those concerns have gone out the window in its announced plans for the Columbia River Gorge.

In ancient Rome, the Rubicon was the boundary which the Roman legions (and their ambitious commanders) were forbidden to cross. When Julius Caesar crossed the Rubicon River it led to the political upheaval that replaced the Republic with his empire. When it comes to road pricing, The Columbia River Gorge could serve as Oregon’s road pricing Rubicon. We could harness the power of pricing to tailor demand for the transportation system to the levels that are compatible with our livability and environmental objectives.  Notice how Oregon DOT spokesman Don Hamilton explains the rationale for the Gorge highway tolling project:

“The Gorge is really Oregon’s crown jewel. Everybody in Oregon and in the region is very proud of the Columbia River Gorge,” Hamilton said. “We’re trying to continue to make this accessible and trying to ease the crowds a little bit to make sure that we can still have access to the Gorge and make sure it doesn’t get overrun.”

What ODOT needs to do next is apply this same reasoning to the rest of the overcrowded bits of its transportation system: i.e. urban freeways in Portland. Hamilton’s reasoning applies with even greater force to congested freeways. To paraphrase:

“We’re trying to make this accessible and ease the crowds a little bit so we can still have access to the city and make sure it doesn’t get overrun.”

If roads are jammed to capacity, the solution is not an expensive, disruptive and environmentally damaging expansion, it’s putting in place some kind of pricing or permitting system that limits the volume of cars and trucks on the roadway to levels it can handle without becoming jammed and making the roadway worse for everyone.

There’s an important historical parallel. The construction of the Columbia Gorge Highway a century ago showed the limits of the old horse-and-buggy system of road finance in Oregon, and directly led to Oregon’s first-in-the-nation adoption of a gasoline tax in 1919 to finance a statewide system of roadways.  At the time, the gas tax was a huge innovation in public finance. In the 21st Century, it’s time to implement a new way of paying for roads that works better, is fairer, and minimizes congestion and environmental harm.  Extending ODOT’s Gorge highway pricing system to the rest of the states roads should be next.

 

More Congestion Pseudo Science

A new study calculates that twenty percent of all time “lost” in travel is due to traffic lights

Finally, proof for the Lachner Theorem:  Traffic signals are a major cause of traffic delay

Another classic example of pseudo-science:  Big data and bad assumptions produce meaningless results

When I was in graduate school, I shared a house in Berkeley with five roommates.  Once a week we’d pool our food dollars, and pile into Archie Lachner’s ’67 Falcon and drive across town to Lucky, Safeway or the Co-Op, and mount a group shopping expedition for the week.  This was in the late 70s, just after Berkeley had installed a series of traffic diverters to stop cut-through driving in residential neighborhoods.  Our driver, Archie, repeatedly chose routes that were blocked by one diverter and then another.  He cursed at the inconvenience:  “These traffic diverters, they get in your way, they slow you down.”  That prompted a heated debate about the merits of diverters.  Archie defended the inherent right of drivers to go wherever they wanted.  Others in the car said they could see how people who lived on these streets might appreciate the diverters cutting down on or at least slowing traffic. Archie had to turn around at least twice to avoid diverters, and as we finally got near the grocery store, we came to to a stop at a red traffic signal.  From the back seat, someone said:  “These traffic lights, they get in your way, they slow you down.”    Offended, Archie, spun the wheel and drove home–“if you can’t respect the driver, you won’t get a ride.”  Despite the protests, Archie drove a couple of miles back home, and the five other roommates had to repeat the trip in another car.

 

Traffic signals cause 20 percent of all time lost to congestion!

Thus was born the Lachner theory of traffic congestion:  Traffic lights get in your way and slow you down.  For decades the theory has been wanting for actual quantification, but at last, we have it.  Crack statisticians at the University of Maryland have sifted through reams, nay gigabytes, of big data, and have produced a comprehensive, nationwide estimate of the amount of time lost when we sit, waiting for red lights to turn green.

According to these University of Maryland estimates, time lost sitting at traffic signals amounts to 329 million vehicle hours of delay, and costs us $8.6 billion dollars per year.  Time spent waiting at traffic signals is roughly three-fifths as great as the 561 million vehicle hours of delay associated with routine “recurring” traffic congestion.

This new study from the University of Maryland finally vindicates the Lachner theorem.  By their reckoning, roughly 19 percent of all traffic congestion is due to waiting at traffic signals.  Those traffic lights do get in your way and slow you down.

Traffic signals cause delays as vehicles queue at intersections. In 10 states, traffic signals are the top cause of traffic congestion, though congestion levels overall remain relatively low in those states. For example, even though Alaska ranked highest in the country in percentage of delay caused by Signals at 53%, it ranked 42nd in terms of total hours of delay caused by signals.

As an accounting exercise, there’s little reason to doubt these calculations. But whether they constitute a “loss” is highly doubtful, because there’s no question that we’d all collectively lose more time in travel if there were no traffic lights.  The policy implication of this finding is not that we should be tearing out or turning off traffic signals.  That would be absurd, of course.  And what the claims of time spent waiting at traffic lights constitute an actual “loss” rests on the assumption that there’s some other traffic-light free way of managing the flow of traffic at intersections that would involve less total travel time for those now waiting.  Simply getting rid of traffic lights—and say replacing them with stop signs—would likely decrease the throughput of many intersections and actually increase delays (though it might beneficially reduce traffic speeds and improve safety for vulnerable road users). Theoretically one might replace every single traffic light in the US with a fully grade separated interchange without stops.

Let’s suppose, for a moment, that you could instantly replace all of the 330,000 or so traffic signals in the US with grade-separated interchanges that eliminated traffic signals.  That might eliminate all the time “lost” by vehicles waiting at traffic lights, but it would come at a cost.  At say, $10 million per intersection (which is probably a conservative estimate) that would cost about $3.3 trillion, all that to save maybe $8.6 billion per year.  Time spent waiting at traffic lights is costly, only if you ignore the vastly greater cost of doing anything to try to reduce it.

It’s easy to point out that the Lachner Theorem about the “time loss” due to traffic lights is pretty silly.  But what’s true of the elaborate (but fundamentally wrong-headed) estimates of the time “lost” to traffic signals is that it also holds for all the other estimates of supposed congestion costs.  For years, a range of highly numerate charlatans have been purporting to compute the value of time lost to traffic congestion. The congestion cost studies generated by the Texas Transportation Institute, Inrix, Tom-Tom and others invariably conclude that traffic congestion costs us billions of dollars a year.  Their copious data creates the illusion of statistical precision without providing any actually useful knowledge.  They generate heat, but don’t shed any light: The congestion cost estimates are part of the propaganda effort of the road-builders, who assert we need to spend even more billions to widen roads to recoup these losses.

It’s an example of a measurement that’s literally true, but quite meaningless.  It’s true in the sense that people probably due spend millions of hours, collectively sitting at traffic lights or traveling more slowly because of congestion.  It’s meaningless, because there’s not some real world alternative where you could build enough road capacity to eliminate these delays.  So, as an elaborate accounting exercise, you can use big data and computing power to produce this estimate, but the result is a factoid that conveys no useful, actionable information—just as we’ve shown with our Cappuccino Congestion Index, which totes up the billions of dollars American’s “lose” waiting in line at coffee shops.

The sky’s the limit if you want to generate large estimates of the supposed time “lost” to slower than imaginable travel.  Consider for example flying cars or helicopters.  If you could travel by helicopter to all your destinations, it would shave hours a day off your total travel time.  With a spreadsheet and some travel data, you could work out an estimate of how many million hours might be saved and how many billions of dollars that saved travel time would be worth.  You could produce a report arguing that the personal helicopter shortage costs us in lost time and money.  It would be a large but meaningless number, because there’s no world where its financially feasible, much less physically possible, for everyone to take every trip by helicopter.

The only way to make meaning of such numbers is in the context of plausible, real-world alternatives.  And that’s exactly what these cost of congestion studies almost invariably fail to consider.  Something is only a “cost” if there’s an actual practical alternative that would save the lost time without incurring even greater monetary costs in doing so.  Imaginary savings from an impossible, or impossibly expensive alternative aren’t savings at all.  All of the evidence about induced travel shows that expanding capacity to try and reduce time “lost” to congestion is ultimately futile:  more capacity encourages more travel, induces more sprawl, and does nothing to reduce congestion and delay.

It’s a welcome sign that one recent report acknowledged this fundamental fact.  To their credit, at least Tom-Tom acknowledges that adding capacity is futile, or even-counterproductive:

Developing road infrastructures and increasing the capacity isn’t the solution. “When a new road is built, it is only a matter of time before more vehicles are added to the road, offsetting this initial easing: it’s called the traffic demand dilemma”, Ralf-Peter Schäfer said. Change behaviours and traffic patterns can make a significant difference. Congestion is non-linear: once traffic goes beyond a certain threshold, congestion increases exponentially. Discouraging drivers to drive during peak rush hour can lead to big improvements, as proven during the pandemic.

And the purveyors of congestion cost estimates almost never point to the only solution that’s been proven to reduce congestion:  road pricing.  Even a modest system of time-based user fees could dramatically reduce congestion.

It’s tempting to believe that more data will make the answers to our vexing problems, like traffic congestion clearer.  But the reverse is often true:  an avalanche of big data obscure a fundamental truth.  That’s what’s going on here.

 

Freeway widening for whomst?

Widening freeways is no way to promote equity.  The proposed $5 billion widening of I-5 between Portland and Vancouver is purportedly being undertaken with “an equity lens,” but widening Portland’s I-5 freeway serves higher income, predominantly white workers commuting from Washington suburbs to jobs in Oregon.

The median income of peak hour, drive alone commuters to Oregon from Clark County is $106,000; significantly higher than for the region as a whole (about $78,000).  

More than 53 percent of peak hour drive alone commuters are from households with incomes over $100,000; fewer than 15 percent of these peak hour car commuters have incomes under $50,000 annually.

Some 86 percent of peak hour, drive-alone commuters are non-HIspanic whites, according to the 2019 American Community Survey; only 14 percent of these peak hour car commuters are persons of color.  Peak hour drivers are half as likely to be people of color (14 percent) as are residents of the region (28 percent).

Clark County is less diverse than the rest of the Portland metro area; its residents of color are vastly more likely to work at jobs in Clark County than to commute to jobs in Oregon.

The proposal to spend $5 billion to widen a 5-mile stretch of I-5 between Portland and Vancouver is being marketed with a generous dose of equity washing.  While it is branded the “Interstate Bridge Replacement” or IBR,  replacing the bridge is less than a quarter of the total cost; most of the expense  involves plans to double the width of the freeway to handle more peak hour traffic. The project has gone to some lengths to characterize suburban Clark County as an increasingly diverse population to create the illusion that the freeway widening project is primarily about helping low and moderate income households and people of color travel through the region.  A quick look at Census data shows these equity claims are simply false.  Peak hour freeway travelers commuting from homes in Washington to jobs in Oregon are overwhelmingly wealthy and white compared to the region’s average resident.

 

Equity? A proposed super-sized $5 billion freeway would mostly serve peak hour commuters with incomes over $100,000, 86 percent of whom are non-HIspanic whites.

What this project would do is widen from 6 lanes, to as many as 14 lanes, five miles of Interstate 5 between Portland and Vancouver.  The principal reason for the project is a claim that traffic volumes on I-5 cause the road to be congested.  But congestion is primarily a peak hour problem, and is caused by a large and largely uni-directional flow of daily commuter traffic.  About 60,000 Clark County residents work at jobs in Oregon, and they commute across either the I-5 or I-205 bridges.  Fewer than a third that many Oregonians work in Clark County, with the result being that the principal traffic tie-ups coincide with workers driving from Clark County in the morning, and back to Clark County in the evening.  Plainly, this is a project that is justified largely on trying to provide additional capacity for these commuters.  That being the case, who are they?

Census data show that the beneficiaries of the IBR project would overwhelmingly be whiter and higher income than the residents of the Portland metro area.  As with most suburbs in the United States, Clark County’s residents, who are those most likely to use the IBR project, are statistically whiter and wealthier than the residents of the rest of the metropolitan area.  In addition, the most regular users of the I-5 and I-205 bridges are much more likely to be white and higher income than the average Clark County resident.  This is especially true of peak hour work commuting from Clark County Washington to jobs in Oregon, which is disproportionately composed of higher income, non-Hispanic white residents.

Peak hour, drive-alone commuters are overwhelmingly white and wealthy

Data from the American Community Survey enable us to identify the demographic characteristics of peak hour, drive-alone commuters going from Clark County Washington to jobs in Oregon on a daily basis. Here are the demographics of the nearly 20,000 workers who drive themselves from Clark County to jobs in Oregon, and who leave their homes between 6:30 AM and 8:30 AM daily.  Some 53 percent of peak hour, drive-alone commuters from Clark County to Oregon jobs lived in households with annual incomes of more than $100,000.  The median income of these peak hour drivers was $106,000 in 2019, well above the averages for Clark County and the region.

Fully 86 percent of the peak hour, drive-along commuters from Clark County to Oregon jobs were non-Hispanic whites.  Only about 14 percent of these peak hour drivers were persons of color.  The racial/ethnic composition of these peak hour car commuters is far less diverse than that of Clark County, or the region.  Clark County workers who work in Clark County are about 50 percent more likely to be people of color than those who commute to jobs in Oregon.

Clark County is whiter and wealthier than the region and Portland

Suburban Clark County, Washington is whiter and wealthier than the rest of the Portland metropolitan area, and the City of Portland. Clark County may be more racially and ethnically diverse than it once was, but so is the entire nation.  And it’s still disproportionately whiter and wealthier than the rest of the region.  Only about 23 percent of its residents are people of color, compared to about 38 percent for the region as a whole, and about 30 percent for Portland, according to the 2019 American Community Survey. Clark County’s median household income of $80,500 is higher than for the region ($78,400) and for the City of Portland ($76,200).

Few low income and workers of color commute to Oregon from Clark County

Not only is Clark County less diverse than the rest of the Portland region, only a small fraction of its low income workers and workers of color commute to jobs in Oregon at the peak hour.  More than ten times as many low income workers and workers of color who live in Clark County work at jobs in Clark County than commute to jobs in Oregon.  About 38,000 Clark County workers in households with incomes of $50,000 or less work at jobs in Clark County; only about 2,800 are peak hour, drive-alone commuters to jobs in Oregon.  About 31,000 Clark County workers of color work at jobs in Clark County.  If we’re concerned about addressing the transportation needs of low income workers and workers of color in Clark County, we should probably focus our attention on the vast majority of them who are working at jobs in the county, not the comparatively small number commuting to Oregon.

Middle and upper income households are far more likely to commute to jobs in Oregon

In general, for Clark County residents, the higher your income, the more likely you are to commute to a job in Oregon.  Only about 1 in 5 workers in households with incomes less than $40,000 in Clark County commute to jobs in Oregon.  About 30 percent of workers in middle and upper income families in Clark County commute to Oregon jobs, meaning that these higher income households are about 50 percent more likely to commute to jobs in Oregon than lower income households.

 

Data notes

Data for this post is from 2019 American Community Survey, via the indispensabile  University of Minnesota IPUMS project:

Steven Ruggles, Sarah Flood, Ronald Goeken, Josiah Grover, Erin Meyer, Jose Pacas and Matthew Sobek. IPUMS USA: Version 10.0 [dataset]. Minneapolis, MN: IPUMS, 2021. https://doi.org/10.18128/D010.V10.0.

Biased statistics: Woke-washing the I-5 Boondoggle

The Oregon and Washington transportation departments are using a biased, unscientific survey to market their $5 billion I-5 freeway widening project.

The survey over-represents daily bridge users by a factor of 10 compared to the general population.

The IBR survey undercounts lower and middle income households and people of color and overstates the opinions of White non-hispanics, higher income households, and Clark County residents

As we’ve noted, highway builders are increasingly engaging in woke-washing, claiming—after decades of experience in which freeway projects have devastated communities of color and destroyed city neighborhoods across the country—that wider freeways will somehow be a good thing for low income people and people of color.

The latest example of this comes from the sales campaign to promote the $5 billion I-5 freeway widening between Portland and Vancouver Washington, misleadingly branded as the “Interstate Bridge Replacement” (IBR) project.  The reality is pretty simple:  the primary beneficiaries of a wider roadway would be higher income, overwhelmingly white commuters who drive daily from suburbs in Washington State to jobs in Oregon.  As we documented last month, the peak hour drive-alone car commuters who cross the I-5 and I-205 bridges from Washington State to jobs in Oregon are whiter and wealthier than the region’s population, with median incomes of $106,000, and 86 percent non-Hispanic whites.

But the IBR project has carefully constructed an alternate reality in which this car-centric freeway widening project is really something that benefits low income people and people of color.  The project’s promotional materials—which actually don’t show the project, or acknowledge its price tag, or the fact that it will charge tolls to bridge users—prominently features stock images of people of color.

Here’s what we mean by “woke-washing.”  The project’s home page featured this image . . .

See our commitment to equity: We bought this stock photo! (Source: Interstate Bridge Replacement Project, March 7, 2022).

. . . which is a stock photograph used by hundreds of websites, mostly those focusing on women’s health.  (Just an aside: A true health-oriented and equity focused project wouldn’t build a 12-lane wide, 5 mile long freeway guaranteed to increase air pollution and with a long history of destroying neighborhoods.)

In addition to its woke imagery, the IBR project supplements this messaging with a pseudo-scientific web-based survey which purports to show that the project is really for lower income people of color.

Selling a $5 billion freeway widening with a woke-washed fable

The IBR staff have developed a fictional “just so” story of how the freeway widening project is needed to help low income households and people of color, who’ve moved to Clark County for cheaper housing, but have to travel to jobs and other opportunities in Oregon.  The survey is grounded, not in actual scientific data, but the project’s own unscientific and biased web-based survey.

Here is IBR staff person Jake Warr, making this false claim to the January 20, 2022 Executive Steering Committee meeting:

One thing that really came out through this survey that I want to highlight is when we . . . asked how often people drive across the bridge, we found a higher percentage of folks who identified with a race or ethnicity besides white or or in addition to white/Caucasian, the non-white respondents really reported more frequently traveling across the bridge.

So that 53 percent‑that’s listed there, 53 percent‑of our of our BIPOC survey respondents reported traveling across the bridge either daily or a few times a week. That’s compared to closer to 40 percent for the white respondents.

IBR’s unscientific and biased web-based survey.

So just something that that really kind of drives home a point that we’ve suspected. It provides further data that you, we’ve seen a trend in our region of folks of color being pushed to further areas of the region, being pushed north of the river, or seeking out more affordable housing north of the Columbia River, but still relying on services jobs etc, in Multnomah County.

And so, there’s that piece that I think this speaks to. We also suspect that related to Covid, as people were answering this question in the context this pandemic, there might be some explanation there, as we know that BIPOC individuals tend to be, disproportionately rely needing to work still in a location and not be able to work from home.

That might have contributed to this but just something that we really found was was a poignant data piece to point out.

The trouble is, this claim is easily disproved by referring to valid survey data from the Census Bureau which shows that commuters across the I-5 and I-205 bridges are actually disproportionately white, and higher income.  Low income workers, and those of color, are dramatically under-represented among bridge commuters.

A biased, unscientific survey from the IBR

The trouble with web-based surveys is they suffer from self-selection bias.  Only highly motivated people take such surveys, and the opinions, experience and demographics of these people differ substantially, and systematically, from the general population.  As a result, it’s simply invalid to make statistical claims (such as people of color are more likely to use the bridge frequently).  That’s especially true when there’s valid scientific data from the American Community Survey, which shows exactly the opposite: peak hour users (for whom the bridge is being expanded) are 86 percent non-Hispanic white and have average incomes of $106,000).

To see just how biased the unscientific IBR web-survey is, we can compare it to other surveys conducted with more valid methodologies.  The correct way to do surveys is with an random selection methodology; the IBR actually commissioned such a survey in 2020.  In its random survey of more than 900 Portland area voters, 13 percent of respondents reported never crossing the I-5 bridge over the Columbia, compared to just 1 percent in the unscientific online survey.  The random survey of voters showed only 5 percent of respondents crossed the I-5 bridge every day, compared to 19 percent in the unscientific online survey.  As a result, the unscientific online survey implies the ratio of daily users to non users is 19 to 1 (there are 19 times as many daily users as never users), while the random survey shows that there are two and a half times as many non-users as daily users of the I-5 bridge.  That means that the unscientific survey overweights the role—and opinions—of daily users relative to non users by more than an order of magnitude relative their share of the overall population of the Portland metropolitan area.

Source: IBR Community Opinion Survey, 2020

Demographic bias in the IBR unscientific web survey

A quick look at the American Community Survey, which is conducted annually by the Census Bureau, shows that the demographics of the IBR’s unscientific web-based survey are dramatically different from the metro area.

One essential for surveys is that participants should be randomly selected.  If they’re not randomly selected, there’s little guarantee that the results will be representative of the larger population. One of the sure tells of a non-random survey is that the characteristics of survey participants don’t match up well with the characteristics of the overall population of the area being surveyed.  That’s the case here.  The IBR survey systematically over-represents some groups, and systematically underrepresents others, which should cast doubt on the validity of its results.  The survey systematically over-represents white, non-Hispanic people, higher income households, and residents of Washington State, and systematically under-represents people of color, low and moderate income households, and Oregon residents.  Here are the details.

Income:  Higher incomes over-represented.  The respondents to the unscientific web-survey are much higher income than the overall population.  Some 44 percent of survey respondents had household incomes over $100,000; only 38 percent of the region’s households had incomes that high.

Race and Ethnicity:  People of color under-represented.   The respondents to the unscientific web-based survey are much more likely to be non-Hispanic white than the overall population; some 85 percent of survey respondents were non-Hispanic white compared to 72 percent of the region’s population.  People of color were 28 percent of the region’s population, but only 15 percent of survey respondents.  People of color were undercounted by almost half in this unscientific survey.

Residence:  Clark County over-represented.  The respondents to the unscientific web-based survey are disproportionately residents of Clark County.  Clark County accounts for less than 20 percent (488,000 of the region’s 2.5 million residents) but accounts for 43 percent of those taking the survey.  Clark County resident views are given more than double the weight of view of other of the region’s residents in this unscientific survey.

Age:  Young people significantly under-represented. There’s also a strong generational bias:  only 5 percent of survey respondents are under 25, compared to nearly 30 percent of the population.  And these people will be the ones who have to live with the environmental consequences of the project.

No doubt the highway agencies will point with pride to the large number of completed surveys–more than 9,000 to date.  But large numbers are irrelevant if you don’t have a random sample.  For a metropolitan area the size of Portland, you need only about 400 to 800 survey participants to come up with statistically valid results,  if you have a random sample.  If you don’t have a random sample, then even very large numbers (and IBR surveyed only about one-third of one percent of the region’s residents) just aren’t meaningful.  The underlying problem that invalidates the survey is called “Self-Selection Bias.” Because this isn’t a true random survey, and because respondents choose whether to participate, there’s no guarantee that the survey data reflect the views (and experiences) of the larger population.  Because those who are predisposed to care about this issue are likely to differ systematically from the rest of the population, the survey produces results that are biased.

Not asking the most important question:  Who wants to pay a toll?

There’s a lot more to dislike about the survey beyond its poor quality sampling strategy and biased sample.  The questions posed in the survey don’t get at the real issues raised by the freeway widening project.  The project’s financial plan shows that it won’t be built without tolls—something you’d be hard-pressed to learn from any of the “public information” work.  The last estimates prepared for the Columbia River Crossing showed I-5 tolls would be a minimum of $2.30 during off peak hours, rising to $3.25 during rush hour, with additional surcharges for those who didn’t buy transponders for their cars in advance.  The survey didn’t reveal these toll rates, or ask people whether they might prefer a smaller, less expensive bridge with lower tolls, to a larger one with these high tolls, or whether they’d really rather keep the existing bridge if it meant they could avoid tolling altogether.  Despite the fact that the survey avoided talking about tolls, many survey respondents raised the question in answering open-ended questions.

It’s rather like a taste test survey that asks people whether they’d prefer filet mignon to a hot dog, without revealing the price tag of either alternative.  For a project that claims so prominently to care about “centering equity,” failing to reveal that people might have to pay on the order of $1,600 per month to commute daily across this bridge is a monumental omission.  But it’s no accident:  the project’s “public information” campaign is designed is an intentionally misleading way to manufacture consent, not to accurately measure public attitudes.

Surveys can be a useful way to gauge public opinion, if they’re undertaken in a scientifically valid fashion.  But if you aren’t careful, you end up with a classic, garbage-in, garbage-out exercise.  That appears to be the case with survey work commissioned by the “Interstate Bridge Replacement” project, a thinly veiled marketing campaign for freeway widening funded by the Oregon and Washington transportation departments—with “communications” consultants reaping more more than $4 million for their services in the past few years.

 

 

 

The I-5 bridge “replacement” con

Oregon and Washington highway builders have re-branded the failed Columbia River Crossing as a “bridge replacement” project:  It’s not.

Less than 30 percent of the cost of the nearly $5 billion project is actually for replacing the existing highway bridge, according to independent accountants.

Most of the cost is for widening the freeway and rebuilding interchanges for miles north and south of the bridge crossing, replacing the current bridge is somewhere between $500 million and one billion.

Calling $5 billion, 5-mile long freeway a “replacement bridge” is like saying if you buy a new $55,000 truck it’s a “tire replacement.” 

Nearly a decade ago, the “Columbia River Crossing—the multi-billion dollar plan to build a wider I-5 freeway between Portland and Vancouver—collapsed of its own fiscal weight, after both the Oregon and Washington Legislatures refused to pony up an estimated $450 million each (as well as signing a blank check to cover future cost overruns and revenue shortfalls). Project advocates delayed for as long as they could revealing the project’s true price tag and actually asking for the money, and when they finally did, legislators balked.

Promoters of the newly re-chrisented “Interstate Bridge Replacement (IBR) Program” have been assiduous in their efforts not to talk about the scale or cost of the project. In two years, they’ve yet to produce a single, new comprehensive illustration of the project—something that’s a standard fare in megaprojects.

That new name is part of the sale pitch.  Ever since attempting to breathe life back into the failed Columbia River Crossing project, the Oregon and Washington Departments of Transportation and their coterie of consultants have been engaged in an extensive effort to rebrand the project to make it more salable. (According to Clark County Today, over the past two years, $5.3 million—more than a quarter of the project’s $21 million spending—has been for “communications.”)

It’s no longer ever referred to as  the “Columbia River Crossing”—although the project’s expensive PR consultants failed to get that talking point to the White House, as President Biden recently referred to it by it’s obsolete moniker.  instead, it’s the far more modest “I-5 bridge replacement program”.  The project’s public materials talk mostly about the existing bridge, and as we’ve noted, almost never reveal that the total project is 5 miles long, that it contemplates widening this stretch of freeway to 12 (or more lanes), will cost upwards of $5 billion, and require minimum tolls of $5 for every round trip across the river.  Project staff are even leery of letting anyone look at computer renderings of the project.

The drawings of the Columbia River Crossing hint at just how massive this project would be.  The following animated GIF shows the design for the CRC as it crosses Hayden Island, superimposed on an aerial view of the existing freeway.  And none of what’s shown in this particular illustration includes the actual bridge structure crossing the Columbia River (which would be out of frame to the left).

The plans for Hayden Island show that much of the area would be paved over in a complex web of on- and off-ramps, flyovers, and multi-lane arterials.  Little wonder the residents of the island are strongly opposed to the project, saying:  “the massive footprint over Hayden Island .  .  . will destroy our community.”  (Hi-Noon Newsletter, January 26, 2022).

On and off ramps for the Columbia River Crossing on Hayden Island, south of the Columbia River.

Calling it just a “replacement” is PR gimmick to conceal all these elements of the project.  But it also conceals where the real money is going:  the reality is that the “replacement” of the two existing I-5 bridges, is just a small part of the project’s total costs—less than 30 percent according to independent estimates.

The “bridge” part of the IBR is less than 30 percent of total costs

In 2012, forensic accountant Tiffany Couch undertook a detailed audit of the CRC cost estimates.  Her analysis showed that the portion of project costs attributable to the bridge structure was $796.5 million—just a shade under $800 million.  Her analysis showed these costs represented just 23 percent of the total $3.49 billion price tag for the entire project..

Acuity Group, Inc., Report #6 Columbia River Crossing – Cost Allocation Discrepancies, April 8, 2013

The estimates by Acuity Group differ from the summary level budget breakdowns publicly distributed at the time by the CRC project staff.   According to Acuity, CRC transferred a portion of the costs associated with interchange overpass construction to the “bridge” portion of the project, effectively understating the cost of the freeway widening on either side of the river, and overstating the cost of the river crossing itself:

According to the CRC’s own detailed budgets, the costs to build the interchanges in Oregon and Washington are expected to cost hundreds of millions more than what is being reported to legislators, public officials, and the citizens of Oregon and Washington. Conversely, the CRC’s own detailed budget shows that the cost to tear down and rebuild the interstate bridge is hundreds of millions less than what is being reported.

According to the forensic accountants, ODOT and WSDOT shifted a portion of the cost of reconstructing interchanges north and south of the bridge by allocating all of the costs associated with overpass structures for these interchanges to the category “interstate bridge”:

. . . we found that when we allocated the cost of the overpasses associated with each interchange to the cost of the interstate bridge, we were able to reconcile to the CRC’s public communications and maps.

Replacing the existing bridge capacity might be only $500 million

Even at $800 million, this price estimate is too high to count as a “replacement” cost, because  much of the cost is associated with increasing the bridge’s capacity to 12 lanes, rather than simply replacing the existing 6 traffic lanes.  Inasmuch as the CRC plan calls for building two side-by-side bridges (each about 90 feet wide), the cost of “replacing” the existing structure with a new one is just the cost of one of these two bridges.  That means the cost of a like-for-like bridge replacement would be less than $500 million.

The CRC and IBR projects are proposing two new bridges: only one is a “replacement;” the other is an expansion.

It also now appears that the revived IBR project will be even larger and more expensive than the CRC.  For example, it has at a minimum added in some expenses that were cut out of the final CRC design, such as the North Portland Harbor Bridge, spanning the a slough south of the Columbia River (which would add about $200 million to the project’s cost).

What this means is that, if the “IBR’ were just about replacing the I-5 Columbia River bridges, its cost would be far smaller—in all likelihood less than $1 billion.  A right-sized bridge would be much more affordable, and wouldn’t raise the strong environmental objections that are associated with the DOTs freeway widening plans.

The IBR Project is still hiding the cost

The epic failure of the Columbia River Crossing had everything to do with the project’s unwillingness to talk frankly about finances, and the same mistake is being repeated this time as well.  It’s fair to ask, why should we rely on ten-year old cost estimates in sussing out the actual cost of “replacing” the current bridges?

The reason is that, so far, after more than two years of work to revive the project, ODOT and WSDOT have yet to produce any new cost estimates.  Their “draft” financial plan, released in November 2020, is based on the old CRC budget, with some adjustments for inflation.  In the past year, none of the meetings of the “Executive Steering Group” supposedly charged overseeing the project has discussed project costs or financing.

The fact that the project hasn’t done new, ground-up cost estimates isn’t an oversight—it’s a conscious strategy, to avoid revealing the true cost and scale of the project—and subjecting themselves to the kind of scrutiny offered in the Acuity forensic analysis of the CRC budget.

It’s a bit like going to the car dealership to get a new set of radials for your fifteen-year old F150, and coming back home in a  new $50,000 pickup truck, and telling your spouse that it’s a “tire replacement” program.

It’s always been a bloated boondoggle

In less guarded moments, influential local politicians have been outspoken about the excessive costs generated by ODOT and WSDOT.   Congressman Peter DeFazio famously declared the Columbia River Crossing project to be a gold-plated monstrosity.  In the Oregonian on August 14, 2011, Representative DeFazio said:

“I kept on telling the project to keep the costs down, don’t build a gold-plated project,” a clearly frustrated DeFazio said. “How can you have a $4 billion project? They let the engineers loose, told them to solve all the region’s infrastructure problems in one fell swoop… They need to get it all straight and come up with a viable project, a viable financing plan that can withstand a vigorous review.”
(Manning, Jeff. “Columbia River Crossing could be a casualty of the federal budget crunch”, The Oregonian, August 14, 2011).
Later, Representative DeFazio told Oregon Public Broadcasting:
“I said, how can it cost three or four billion bucks to go across the Columbia River?  . . . The Columbia River Crossing problem was thrown out to engineers, it wasn’t overseen: they said solve all the problems in this twelve-mile corridor and they did it in a big engineering way, and not in an appropriate way.”
“Think Out Loud,” Oregon Public Broadcasting, August 18, 2011.

The irony is that if this project were just about replacing the bridge, rather than building a massive freeway, not only would the project be vastly cheaper, there’d almost surely be less public opposition to the project.  The objection isn’t to having a safe, functional bridge, its to building a giant highway that will worsen pollution and bankrupt taxpayers and commuters.

Transportation trends and disparities

If you aren’t talking about our two-caste transportation system, you’re not really addressing equity.

Portland’s regional government is looking forward at trends in the transportation system and their implications for equity.  In December, City Observatory submitted its analysis of these trends for Metro’s consideration.

Local and regional leaders are increasingly promoting concerns of equity in transportation, as well they should.  But many analyses of equity leave out the most fundamental inequity in the structure of transportation:  our explicit two-caste system that privileges those who can afford and can operate cars, and systematically disadvantages everyone else:  those too young, too old, too infirm or too poor to own and operate a motor vehicle.  Those in the lower caste are condemned to lives of impaired access to the economy and society, and greater risk of death and injury when they do travel. Many of the other observed inequities in transportation flow directly from this two caste system.

If governments are serious about rectifying inequities in transportation they have to look past symptoms and superficial manifestations to underlying causes.  A careful consideration of these trends will take them in this direction.

 

Trend Disparities
Portland will continue to have a two-caste transportation system, with priority for those who can afford to, and are legally and physically able to operate a car (the upper caste), and lower priority for those too poor, too young, too old, to operate a car (the lower caste). Most of the other inequities (safety, pollution, lack of access and discrimination) flow from this two-caste system. Low income people, people of color, and the old and the young are disproportionately consigned to being in the lower caste by our car-dependent transportation system.

 

 

 

 

 

Portland area transportation greenhouse gas emissions have increased by 1,000 pounds per person annually (14 percent) over the past few years, and show no signs of declining, despite state, regional and local plans calling for a reduction in GHGs. The region will have to take much bolder action than any laid out in the RTP to comply with adoption laws. Climate change caused by GHG emissions disproportionately come from higher income households and lower density sprawling neighborhoods, and disproportionately affects low income neighborhoods.

 

 

ODOT plans to spend billions of dollars widening area freeways, which will induce additional travel; Gas taxes from road use don’t cover anything approaching the cost of building and maintaining freeways, meaning that their costs are subsidized by non-users. Freeways are only usable to people who can afford the roughly $5,000 annual cost of owning and operating a car. Car ownership is much lower among low income populations and people of color.   A car dependent transportation system doesn’t work for those who can afford to own a car and those who can’t or shouldn’t drive.
The number of persons killed on Portland area streets and roads has increased steadily. Pedestrians and other vulnerable road users account for half of deaths. Most transportation spending is devoted to enabling vehicles to move faster making roads more dangerous for non-car travelers People of color, low income people, and the young and old are disproportionately likely to be pedestrians, cyclists and vulnerable road users. Spending most transportation dollars on freeways, which are the least deadly roadways is inequitable.
Gasoline prices and gas taxes don’t cover the fiscal, social or environmental costs caused by driving. These costs, which range into the billions of dollars annually, are shifted to non-users.

 

Under-charging users for the costs of driving results in more driving, and more social costs that would otherwise occur, and unfairly imposes these damages and costs on non-users, who tend to be disproportionately low income and people of color.
Public policies will continue to allow unpriced use of public roads by cars while charging prices for use of transit. Congestion on public streets by unpriced private automobiles diminishes the speed and efficiency of public transit, which lowers its productivity, decreases its services levels and competitiveness, which lowers ridership and increases costs. Low income people and people of color, as well as the very young and very old are more likely to be transit-dependent than the overall population. They disproportionately bear the costs of worse bus service caused by the unpriced use of public streets by private cars.

 

Public policies will continue to subsidize free on street parking for most car owners at a cost of tens or hundreds of millions of dollars a year. Free and subsidized parking only benefits those who own cars, and disproportionately benefits higher income and whiter populations.
Roads and streets continue to contribute 50 percent or more to stormwater runoff, which causes pollution, and is expensive to fix.   Yet streets and roads, and their users pay nothing toward costs of stormwater collection and treatment. These costs are largely shifted to water users, especially households, many of whom don’t own or drive cars. Low income populations and people of color are disproportionately likely to be responsible for paying costs of stormwater due to costs shifted on to residences.

 

 

 

 

Adjacency is not a good measure of equity

 

 

 

 

 

 

Currently Metro relies on measures of adjacency (i.e. the demographic composition of census tracts adjacent to transportation infrastructure) to determine whether projects are equitable; This approach ignores the negative effects of proximity to many types of infrastructure, particularly highways)..
Accessibility Measures should be used, rather than mobility.

 

 

 

 

 

 

 

 

The performance of the transportation system should be judged by accessibility (the number of destinations one can easily reach), rather than by mobility (distance and speed traveled).   Maximizing accessibility is consistent with the region’s environmental, social and land use objectives; maximizing mobility undercuts key objectives and is more expensive.
Equity is best served by direct payments rather that more spending to increase supply.

 

 

Measures such as Portland’s transportation wallet can promote equity by giving more purchasing power and a wider array of options to low income households and targeted populations.
Target VMT reductions. Reduced VMT is needed to achieve the state and region’s legislatively mandated GHG reduction goals. Portland decreased VMT 1.5 percent per year between 2005 and 2013. VMT reduction saves money and stimulates the local economy, which benefits disadvantaged populations. The 1.5 mile per day decrease in average trips between 2005 and 2013 saved the region $600 million per year on transportation expense, which benefited the local economy.
Transportation spending targets peak hour car trips.

 

Peak hour car commuters have vastly higher incomes than the general population, and those who commute by transit, bike or walking
Green Dividend: Measures that reduce transportation costs have, in the past, created a “green dividend” for local households. Failure to continue to decrease VMT and transportation expense would be a missed opportunity to improve the region’s economy.

 

 

Transportation is costly: the average household spends 15 percent of its income on transportation.   Policies that reduce the amount of travel that households need to make, as measured by average VMT, reduce household expenses and increase household disposable income. Transportation expenditures are particularly burdensome for lower income households.
Demand for Walkability. Walkable neighborhoods are in high demand and short supply. More housing in dense, high demand locations results in fewer VMT, lower GHG emissions, and higher use of transit, biking and walking.

 

 

More and more people are interested in living in walkable urban neighborhoods, which are in short supply.   The failure to build enough housing in walkable neighborhoods drives up housing prices, and makes it more difficult for low income households to be able to live in walkable neighborhoods, where transportation costs are lower.

Metro’s “Don’t Look Up” Climate Policy

Metro, Portland’s regional government, says it has a plan to reduce transportation greenhouse gases

But in the 8 years since adopting the plan, the agency hasn’t bothered to look at data on GHGs—which have increased 22 percent, or more than one million tons annually.

Metro’s Climate Plan is “Don’t Look Up” 

In the new movie “Don’t Look Up,” Jennifer Lawrence and Leonardo DiCaprio play two scientists who identify a planet-killing comet headed for earth.  Their warnings go largely ignored, and by the end of the movie, there’s an active anti-scientific movement, which as the comet becomes visible in the sky, tells its adherents to simply “Don’t look up.”

The movie is an allegory for our climate peril:  faced with mounting scientific evidence about the trajectory of climate change, and the increasingly evident manifestation of heat waves, storms, flooding and fires, too many of our leaders are simply looking away.

And in Portland, which prides itself as being a green leader, the regional government has, effectively been pursuing a “Don’t Look Up” climate policy.

Noble intentions, soaring rhetoric

Here’s the background.  In 2007, the State Legislature set a goal of reducing Oregon greenhouse gas emissions by 75 percent by 2050.  And in 2014, Metro, Portland’s regional government adopted what it called a “Climate Smart Strategy” to reduce greenhouse gasses.

On paper, seems good.

The Metro plan had a few policy ideas for reducing greenhouse gas emissions, for example by expanding transit and promoting more compact land uses, which would enable more cycling and walking.  But for the most part, it relied on expectations that federal and state regulations and car makers would figure out a way to quickly make cars non-polluting.  Recognizing—at the time, at least—that there was a lot of uncertainty in the efficacy of these policies and the evolution of technology, Metro promised that if its efforts weren’t reducing greenhouse gasses, it would revisit the plan and take even tougher measures.

Here it is, eight years later.  How is that “Climate Smart Strategy” working out?

Well, you might read through Metro planning documents, but nowhere in them will you find any data on the change in transportation-related greenhouse gases in Metro’s planning area in the years since 2014.  In essence, after adopting its plan, Metro hasn’t looked up.

But just like in the movie, scientists are looking up.  And what they see, specifically in Portland, is that the Metro strategy is failing—greenhouse gas emissions are increasing, not decreasing, as called for in Metro’s plan.

Here, the parts of Leonardo DiCaprio and Jennifer Lawrence are played by real-life Boston University physicists Conor Gately, Lucy Hutyra and Ian Sue Wing.  Their research was sponsored by NASA, published by the National Academy of Science, and their database is maintained by the Oak Ridge National Laboratory.  What they’ve done is to create a nearly four-decade long, very high resolution map of greenhouse gas emissions from on-road transportation in the US.  They’ve mapped emissions down to a 1 kilometer (0.6 Mile) square grid for the entire nation, for each year from 1980 through 2017.  (There are more details about the project below). Their data is the best evidence we have on the trajectory of this comet.  And for Portland, the news is not good.

Here’s what their data show for the tri-county Portland metro area:

The green line on the chart is the actual amount of greenhouse gas emissions from transportation in Clackamas, Multnomah and Washington Counties from 1990 through 2017.  The blue line shows the trajectory of emissions needed to achieve the greenhouse gas reduction goals spelled out in Metro’s 2014 climate action plan.  In 2013, the year before Metro adopted its plan, emissions were about 6 million tons.  The plan envisioned the emissions levels going down by roughly a million tons by 2017.  But instead, as the green line shows, transportation greenhouse gas emissions in the Portland area increased by nearly 1 million tons a year after 2013, to 7 million tons.

Metro’s “Climate Smart Strategy” isn’t just somehow behind schedule.  It is failing.  Emissions are increasing, not decreasing.  The comet is accelerating towards earth. So what are the leaders doing?

Not looking up

Metro’s climate plan promised to track emissions.  To be sure, Metro has published annual sustainability reports since 2014.  And they proudly mention the adoption of the Climate Smart Strategy.  But the only thing Metro tracks in these reports is greenhouse gas emissions (and other environmental effects) of its own internal business operations.  There’s absolutely no mention of overall regional trends from the transportation system Metro is charged with planning.  Neither does the 2018 Regional Transportation Plan provide a time series of data showing the trend in regional transportation greenhouse gas emissions.

Metro’s plan also promised to take additional and tougher measures if those in the Climate Smart Strategy weren’t working fast enough.  On page 1 of the 2014 strategy document, Metro committed to periodically assessing its progress and said:

If the assessment finds the region is deviating significantly from the Climate Smart Strategy performance monitoring target, then Metro will work with local, regional and state partners to consider the revision or replacement of policies, strategies and actions to ensure the region remains on track with meeting adopted targets for reducing greenhouse gas emissions.

But if you don’t track your progress, you don’t have to admit you’re failing and you don’t have to  bother with considering more serious steps to reduce greenhouse gases.  Don’t. Look. Up.  It’s a recipe for disaster, and it’s the approach Metro is taking.

The science behind the DARTE database.

The tragedy here is that we have sound scientific data that tell us what is happening.  The research, undertaken over a period of years, sponsored by NASA, gives us a very granular, long-term picture of how our climate efforts are fairing.  You can’t claim to be taking climate change seriously if you aren’t paying attention to this kind of data.

Gately, C., L.R. Hutyra, and I.S. Wing. 2019. DARTE Annual On-road CO2 Emissions on a 1-km Grid, Conterminous USA, V2, 1980-2017. ORNL DAAC, Oak Ridge, Tennessee, USA. https://doi.org/10.3334/ORNLDAAC/1735

Their results were featured in the New York Times in October 2019.  We alerted Metro staff to the availability and importance of this data in October 2019 (Cortright to Kloster, October 16, 2019).

ODOT’s forecasting double standard

Oregon’s highway agency rigs its projections to maximize revenue and downplay its culpability for climate challenge

ODOT has two different standards for forecasting:  When it forecasts revenue, it says it will ignore adopted policies–especially ones that will reduce its revenue.  When it forecasts greenhouse gas emissions, assumes policies that don’t exist–especially ones that will magically make greenhouse gas emissions decline.

Revenue forecasts are “purely based on historical data” and don’t include adopted policies.  Greenhouse gas emission forecasts are based on “goals” and “wishes” and are explicitly not an extrapolation of past trends.

The inflated revenue forecasts are used to justify (and help fund) highway widening; the greenhouse gas emission forecasts are used to absolve the agency from any responsibility to reduce driving related greenhouse gas emissions.

As we’ve pointed out, the Oregon Department of Transportation keeps two sets of books when it comes to climate emissions.  It tells the public that it cares about climate and greenhouse gas emissions in its largely performative “Climate Action Plan,” but when it comes to the agency’s budget, it tells financial markets it’s counting on Oregonians burning just as much gas—and creating just as much carbon pollution—a decade from now as they do today.

ODOT’s officials have defended their revenue forecasts as being merely passive representations of current trends, unaffected and unfiltered by state policy objectives.  Somehow these actions that produce revenue are beyond either their control or responsibility.

But when it comes to the agency’s climate plan, they’ve gone out of their way to make highly speculative assumptions that all kinds of other actors—consumers, automobile manufacturers, the federal government and other state agencies—will make radically different decisions or implement entirely new policies that lead to reductions in greenhouse gases.

ODOT has a double-standard for forecasting—when it comes to forecasting climate, and especially establishing its responsibility for greenhouse gas emissions—it will make elaborate and speculative assumptions about other people doing things that will make the problem go away.  When it comes to estimating its own revenue (which it then uses to justify building new roadways and borrowing for more), it assumes that nothing will change and that it can safely ignore already adopted legal requirements to implement congestion pricing and limit greenhouse gases—both of which will reduce gas tax revenue.  It’s a deceitful, inconsistent and self-serving approach to forecasting.

ODOT Revenue Forecasts:  We assume nothing will change and ignore our own adopted laws.

Earlier, we pointed out that ODOT’s revenue forecasts are utterly at odds with claims it will reduce transportation greenhouse gas emissions, as mandated by state law, and directed by Governor’s executive order.  ODOT representatives defended their forecasts in the media by saying that the agency’s forecasting approach was merely to extrapolate existing trends, and that its forecasts were in no way a reflection of its policy objectives.

Here’s ODOT spokesman Don Hamilton responding to Willamette Week.

“ODOT revenue forecasts are based purely on consumer patterns and historical data,” says ODOT spokesman Don Hamilton. “They are not based on what we want to see.”

The forecasts also don’t take into account the reductions in driving that may come with “congestion pricing” or other ODOT initiatives, Hamilton says.

“As Oregon executes many of its climate-focused programs, we expect gas sales to decline, and we will revise our gas sales forecasts to reflect those changes as they occur.”

Oregon Public Broadcasting’s Dave Miller pushed the agency’s top planner, Amanda Pietz to explain the discrepancy:

Dave Miller: . . .  I want to focus on a new critique that I’m sure you’re aware of. It came about a week and a half ago from the frequent ODOT critic Joe Cortright, the economist. He put out a report digging into the agency’s estimates given to financial markets about expected gasoline tax revenues through the end of this decade. This was his summary: “What ODOT official revenue forecasts are telling us is that the agency fully expects us to be generating just as much greenhouse gasses from driving in 2030 as we are today. Indeed,” he wrote, “the agency is counting on it to pay its bills.” Amanda Pietz, how do you explain this?

Amanda Pietz: I think it goes back to the earlier statement I was making. When we do our revenue forecasts it’s often looking back at the trends then and projecting those forward without necessarily seeing some of the interventions take hold and create those changes.[Emphasis added].

Dave Miller: I’m slightly confused by that, and that jibes with what an ODOT spokesman said when there was an article about it this week in Willamette Week. But aren’t you supposed to give bond markets a projection that is as accurate as possible? If the whole point is [to say] “trust us, we’ve got revenue coming in, we can back these bonds and here’s our estimate for how the money is going to be coming in,” why don’t you factor in all the things you say you’re going to be doing so economic markets can know to trust you?

Amanda Pietz: Part of what is done when we look at things is [that] we have to rely on something very solid – a clear policy change, a solidified investment that’s been amended into our investment strategy in a way that’s very clear, it’s solid. I think what you’re seeing is an agency that’s recognized that we’re a contributor to the problem in the last year and [is] starting to make some changes and modifications. Now when those take hold and the degree to which they’re solidified [so] that we can roll them into our financial assumptions, my guess is another six months to a year before you start to see some of those. Another key example of that is DEQ has its Climate Protection program which will set limits on fuel sales that will have a big impact on that revenue forecast. That’s in draft form, not finalized. When that’s finalized, becomes implemented, and there’s clarity around what that looks like, that’s when it gets rolled into the financial assumptions. Similar things for us, too. I mentioned we’re investing over $50 million dollars in transportation electrification. We should see fuel sales drop as a result of that. Until we figure out exactly where we’re placing that, how we’re going to leverage with our private partners to put those in the right locations, [that’s when] we can factor that into our revenue forecast.[Emphasis added].

ODOT Climate Forecasts:  Wishes and speculation, including magical policies that don’t exist

When it comes to making forecasts about future automobile emissions, and whether the agency will need to do anything to curtail the growth of driving in order to achieve the state’s statutory greenhouse gas reduction goals ODOT has an entirely different approach to forecasting.  It makes heroic assumptions about things that might happen, if somebody else does them.  It pretends that policies that don’t exist will be adopted and aggressively implemented. And all of these assumptions are skewed in a very particular way, i.e. to reduce or eliminate any need for ODOT to take responsibility for cutting greenhouse gases from cars and driving in Oregon.

These assumptions are built into the State Transportation Strategy (STS), developed by ODOT to sketch out how Oregon might reduce transportation greenhouse gases in the decades ahead.  In a memo prepared for the Land Conservation and Development Commission, explaining the STS modeling, Brian Gregor, who was ODOT’s modeler, explained ODOT’s approach to estimating future greenhouse gas emissions from cars.

The members on the Core Tech Team from the Departments of Environmental Quality and Energy agreed that the STS “trend line” is a reasonable reflection of goals that California, Oregon, and other states participating in the multi-state ZEV standards wish to achieve. They caution, however, that this planning trend does not reflect recent trends in vehicle fuel economy. Substantial efforts on the part of states and the federal government will be necessary to make this planning trend a reality. [Emphasis added].

A footnote on page 30 of the LCDC report makes this point even more clearly:

It is important to note that these ‘trend lines’ represent the trend in the model results given the vehicle assumptions in the STS recommended scenario. They do not represent an extrapolation of past trend. [Emphasis added].

The contrast couldn’t be sharper:  when it comes to estimating an elevated level of future revenue, ODOT discounts anything that will reduce driving or pollution, and won’t even consider the impact of policies, like congestion pricing, which were approved by the Legislature in 2017.  But when it comes to optimistic speculation about technologies or policies that might lower future vehicle emissions—absolving ODOT of the need to act—the agency will definitely count on policies that haven’t been adopted by anyone.  It’s a clear and calculated strategy to avoid responsibility for doing anything to address climate change.

Clearly, ODOT’s current revenue forecasts are counting on the failure of the state’s climate efforts.  They’re assuring financial markets that Oregon will collection hundreds of millions of dollars in motor fuel tax revenues with which to repay bonds it will use to expand the state’s highways, encouraging and subsidizing more driving and greenhouse gas emissions.  It may seem like an arcane detail, but it’s the kind of technocratic climate arson that’s routinely practiced by state highway departments.

 

Metro’s failing climate strategy

Metro’s Climate Smart Strategy, adopted in 2014, has been an abject failure

Portland area transportation greenhouse gasses are up 22 percent since the plan was adopted: instead of falling by 1 million tons per year, emissions have increased by 1 million tons annually, to more than 7 million tons, putting us even further from our climate goals.

Metro’s subsequent 2018 RTP has watered down the region’s climate effort far below what is needed to comply with Oregon’s statutory greenhouse gas reduction goal, based on the assumption that 90 percent of emission reductions would be accomplished with cleaner vehicles.

All of Metro’s key assumptions about transit, vehicle turnover, technology adoption, and driving, have been proven wrong.

The plan has set a goal for reducing vehicle miles traveled that is actually weaker than the reductions the region achieved in the decade prior to the adoption of the “Climate Smart Strategy.”

The agency has not acknowledged the failure of its climate efforts, and is at the same time moving forward to allow the Oregon Department of Transportation to build a series of freeway widening projects that will add more than 140,000 tons of greenhouse gasses per year.

Metro, Portland’s regional government, talks a good game when it comes to climate. It has adopted a so-called “Climate Smart” strategy, and a regional transportation plan that it claims will lead to a reduction in greenhouse gasses. But a close analysis of the Metro’s planning documents and other independent information shows the plan is failing, and is far too feeble to come anywhere close to achieving the state’s adopted legal goal of reducing greenhouse gasses by 75 percent by 2050.

1. We’re going in the wrong direction:  Portland transportation GHG up 22 percent

The clearest measure of failure is the one million ton increase in annual greenhouse gas emissions in Portland over the past few years. Carbon emissions accounting is technical and complex, but for Portland, for the past five years, when it comes to transportation greenhouse gas emissions, and whether we’re making progress, there are just three numbers you need to know:  6, 5, and 7.  In 2010, (the base year for Metro’s Climate Smart Plan), the tri-county area produced about 6 million tons of greenhouse gasses from transportation.  The plan set a goal of reducing transportation greenhouse gasses by about 63 percent by 2035 (the plan’s terminal year), which means that to be on track, the region would need to lower its emissions to about 5 million tons of transportation GHGs by 2017.  But the data from the DARTE national transportation greenhouse gas inventory shows that the region’s emissions increased to more than 7 million tons.  So instead of reducing greenhouse gasses by at least a million tons, we’ve actually increased greenhouse gasses by more than a million tons.  We’re not just “not making progress,” we’re going rapidly in the wrong direction.  Since 2010, we’ve fallen about 2.5 million tons behind the path we need to be on in order to meet the goal laid out in Metro’s Climate Smart Strategy.  

 

 

Metro’s monitoring report, prepared as part of the 2018 Regional Transportation Plan, fails to acknowledge that the region is manifestly failing to reduce GHGs.

2. Metro’s 2018 Regional Transportation Plan doesn’t even propose to get us to the adopted state GHG Goal

Metro’s climate plans are spelled out in two documents, a “Climate Smart Strategy” (CSS) adopted in 2014, which proposed a 20 percent reduction in vehicle miles traveled, and a subsequent 2018 Regional Transportation Plan (RTP).  The adopted 2018 Regional Transportation Plan borrowed much of the rhetoric from the 2014 Climate Smart Strategy, but without any announcement or fanfare, radically watered down the region’s greenhouse gas reduction objective.  The CSS set a goal of reducing GHG’s by 63 percent by 2035; the 2018 RTP modified this to a GHG reduction of only 19 percent by 2040 (RTP Table 7.31 “Projected Mobile Source Greenhouse Gas Emissions by Investment Strategy.).

The following chart shows the difference in the two plans. The starting dates for the two plans are set to the base years for their climate calculations (2010 for the CSS, 2015 for the RTP).  The glide slope lines are computed as the average annual percentage reduction in greenhouse gases needed to reach the end year target.

Metro’s Climate Smart goal falls far short of what’s needed to meet Oregon’s statutory greenhouse gas emissions reduction, and even further short of meeting Governor Brown’s Climate Emergency Executive Order—which calls for an 80 percent reduction in greenhouse gas emissions by 2050.  Metro is relying as its justification for these goals a claim that is following guidance from LCDC.  But in fact, Metro is planning for a reduction in vehicle miles traveled than is only one-fifth as much as called for in state regulations (see #4 below), and our analysis shows that overly optimistic assumptions used by LCDC mean that VMT reductions actually need to be much larger than specified in the LCDC targets (Appendix B).  Not only is it failing to comply with the LCDC regulations (as explained here), those regulations have set planning goals that are now inadequate.  Also:  LCDC’s regulations don’t supersede or repeal the state statutory mandate to reach a 75 percent reduction in GHG by 2050, and Metro’s Climate Smart Strategy and 2018 Regional Transportation Plan are inadequate to put the region on track to do its share to achieve the 2050 goal of a 75 percent reduction in transport greenhouse gas emissions.

3. Metro’s plans assumes other people will reduce transport GHGs, not Metro, and its assumptions have been proven wrong

Both the Regional Transportation Plan and the earlier Climate Smart Strategy rely almost entirely on optimistic assumptions about vehicle fuel economy, electrification, fewer trucks and SUVs, and cleaner fossil fuels. Roughly 90 percent of the reduction in per capita greenhouse gasses claimed by Metro come from actions over which it has no control. Its strategy is far less about what it will do to address climate change, and almost entirely wishful thinking about what others will do.

Metro’s 2014 Climate Smart Strategy was based on assumptions that other entities (some unspecified combination of the federal government, state government, auto makers, car buyers) would take actions that reduce greenhouse gas emissions per vehicle mile traveled by 38 percent between 2010 and 2035.  Metro’s plan actually contains no actions that influence per vehicle mile vehicle emissions.

(Source: Metro Climate Smart Strategy (2014).  Right hand column data supplied by City Observatory; sources noted in Appendix B).  

Similarly the 2018 RTP is based on even more aggressive assumptions about cleaner vehicles, drawn from the Oregon Department of Transportation’s Statewide Transportation Strategy.

None of the key assumptions in Metro’s climate plans are being realized. Federal fuel economy standards are being watered down, SUV and light truck sales are more than double market share assumed in Metro’s modeling, older, dirtier vehicles are lasting longer and being driven further, and vehicle electrification is proceeding too slowly to achieve adopted goals.  Further data for each of these points is provided in Appendix B.

  • Metro assumed that average vehicle fuel economy would more than double. Actual fuel economy has barely moved in the past decade.
  • Metro assumed that people would buy new cars more often, and scrap old cars more quickly causing average vehicle age to decline (get newer) by 25 percent, with average age declining from 10 years to 8 years.  Instead, average vehicle life has increased to almost 12 years.
  • Metro assumed most people would buy more small and efficient passenger cars, and fewer trucks and SUVs.  Metro assumed that lighter more efficient passenger cars would make up 70 percent of the market, outselling trucks and SUVs more than 2-to-1.  The opposite has happened:  the market for passenger cars has collapsed to less than 30 percent market share.
  • Metro didn’t make explicit predictions about vehicle electrification, but data from ODOT show that by 2029, no more than 3 percent of the state’s light duty vehicle fleet is expected to be electric.

4. Metro has a feeble and ever-shrinking goal for reducing vehicle miles traveled.

There are basically two ways to reduce greenhouse gas emissions:  Cleaner cars or less driving.  Metro policies have almost no influence on cleaner cars; in contrast, Metro’s policies, including land use planning, permitting more road capacity, and assuring alternatives, like biking, walking and transit, can all influence the amount of driving.

It’s a bit of a simplification, but these two concepts can be reduced to two measures:  Grams of carbon per vehicle mile (cleaner cars), and vehicle miles traveled (less driving).  As discussed above, Metro’s RTP is overwhelmingly counting on “cleaner cars” as providing roughly 90 percent of the reduction in transportation GHGs through 2040, and counting on less driving to provide only about 10 percent of greenhouse gas reductions.

For any given level of pollution per mile, increases in vehicle miles traveled result in increases in greenhouse gas emissions.  Transportation planners focus on “vehicle miles traveled per capita” to measure the level of driving in a metropolitan area.

Metro’s initial plan, the 2014 Climate Smart Strategy, set a goal of reducing per capita VMT by 20 percent by 2035.   As presented in the original Climate Smart Strategy, Metro identified a goal of reducing VMT per capita by 20 percent from 2010 levels, from 20 miles per person per day to 16 miles per person per day. (This is from page 65 of Metro’s 2014 Climate Smart Strategy).

In the 2018 RTP, Metro changed the yardstick and twice moved the goalposts on VMT reductions.  First, it changed the yardstick, measuring  VMT per capita in a much narrower way (looking only at miles traveled by regional residents inside the metropolitan planning area).  The new yardstick looked at a base of 13 miles per person per day, compared to 20 miles per person per day.  This new system of measurement excludes looking at about one-third of all vehicle travel in the Portland region.

Second, it retroactively changed the reported goals for the Climate Smart Strategy, lowering the baseline level of travel to 19 miles per person per day, and raising the 2035 “monitoring target” to 17 miles per day.  So while the as published 2014 Climate Smart Strategy visualized a 20 percent reduction in VMT from 20 to 16 miles per day; the 2018 RTP reported that the Climate Smart Strategy envisioned only about a 10 percent reduction in VMT, by two miles per person per day, from 19 to 17 miles.

Third, the 2018 RTP presented the 10 percent reduction as a goal, but then substituted the new yardstick (i.e. 13 miles per person per day in the base year, now 2015, and pushed out the terminal year for reaching the new goal of 12.4 miles per person per day to 2020.  2018 RTP (Chapter 7 “Outcome Measures”) and Appendix J “Climate performance monitor”).

 

But while Metro proclaimed as its goal reducing vehicle miles traveled by 10 percent, the plan’s analysis concluded that the measures included in the RTP would only reduce driving by a fraction of that amount by 2040.  The climate analysis contained in the 2018 RTP called for reducing VMT by 10 percent per capita, but the performance monitoring report in Appendix J of the 2018 RTP concludes that full implementation of the RTP would result in a decrease of more than 5 percent, “not reaching the target.”  The actual figures shown in the report (a decline from 13 miles per person per day to 12.4 miles per person per day) amounts to a 4.6 percent decline in VMT per capita.

Elsewhere, the RTP concedes that the plan will reduce per capita VMT by about 4 percent.

The reductions in vehicle miles traveled anticipated in the 2018 RTP are far smaller than needed to comply with LCDC regulations guiding climate planning.  Metro would need to achieve VMT reductions of about 20 percent per capita to comply with these guidelines.  The projected 4 percent decline in VMT/capita envisioned in the 2018 RTP is less than one-fourth the progress needed to meet the state guideline.  In addition, as explained in Appendix B, the state target  for VMT reduction is far too low to achieve the state’s greenhouse gas emission reduction requirements because state and local agencies have dramatically over-estimated likely progress in reducing vehicle emissions.

Actual Performance Compared to Metro Goals

To evaluate the VMT goal, it is necessary to put the vehicle miles traveled per person per day statistic in context.  Metro, using data from the Federal Highway Administration has produced a data series showing historical VMT per capita for the Portland area going back to 1990.

Vehicle Miles Traveled, a core measure of transportation activity, which has been trending down since the late 1990s, has essentially stopped declining. In the decade before the Climate Smart Strategy was adopted, Portland area VMT per capita was declining at a rate of about 1.2 percent per year. The Climate Smart Strategy failed to even plan for continuing that trend; according to Metro’s own estimates, since 2014, VMT per capita has almost flat-lined, declining just 0.15 percent per year.  The 2018 RTP has even lower expectations, lowering VMT by just 4.6 percent over the 25-year period from 2015 to 2040, which works out to an annual decline of  0.2 percent per year.  


Metro’s 2018 RTP predicts that the agency’s policies will produce a far slower rate of VMT reduction that the region accomplished over the period 2004-2013 (prior to the adoption of the first Climate Smart Strategy).  The 2018 RTP lowers the VMT reduction goal set in the 2014 CSS by more than 75 percent, from a 20 percent reduction over 25 years to a 4.6 percent reduction.  That’s not enough of a reduction in driving to meet the targets called for in LCDC regulations, nor is it enough to achieve the state’s goal of reducing greenhouse gas emissions to 25 percent of their 1990 levels by 2050.

Summary of Metro Area VMT Reduction Performance and Goals

5. Transit Ridership, a key factor in reducing GHG, is failing to meet projections.

One key strategy to reduce greenhouse gas emissions is to shift trips from private automobiles to mass transit.  Metro’s regional transportation plan calls for reducing vehicle miles traveled and decreasing greenhouse gas emissions by increasing the share of the region’s trips taken by bus and light rail.  Each successive regional transportation plan since 2004 has projected that transit ridership levels under the plan will double in the next ten to twenty years.  

Metro’s transit ridership projections have been grossly overstated in every Regional Transportation Plan, and TriMet’s operating plans show it has no intention (or ability) to carry as many passengers as the RTP assumes in order to make progress.  The RTP assumes transit ridership will more than double between 2015 and 2040, from 250,000 originating riders to more than 600,000 originating riders, which shows no signs of happening.  Even prior to the Covid pandemic, transit ridership was falling, down 7 percent from its peak in 2012.  Rather than growing at more than three and a half percent per year—pre-pandemic—ridership has been declining at about one percent per year.

 

Every RTP has consistently predicted high levels of transit growth that have not materialized.  The 2004 RTP predicted 2020 ridership would be 383,000, the 2010 RTP predicted 2020 ridership would be 349,000, the 2014 RTP predicted ridership in 2020 would be 326,000; actual ridership (as noted) is about 250,000 (pre-Covid).

The consistent failure of the region to realize the gains in transit ridership called for in the last four RTPs suggests that we will need to do much more to reduce VMT and greenhouse gasses.  It also suggests that Metro’s transit ridership model is biased and inaccurate.

6. Approving more highway capacity would increase greenhouse gas emissions

Even though its climate plan is failing, Metro is giving the Oregon Department of Transportation the greenlight to spend billions of dollars expanding area freeways that are likely to lead to huge increases in greenhouse gas emissions. The RMI induced travel calculator, calibrated based on award-winning, peer-reviewed research from the University of California, Davis, estimates that the Rose Quarter Freeway widening project will produce an addition 40,000 tons of greenhouse gasses per year and the revived Columbia River Crossing will likely produce a further 100,000 tons of greenhouse gasses per year.

The Induced Travel Calculator shows that revived Columbia River Crossing project (now rebranded as “I5 Bridge Replacement Program“) would produce an additional 155 to 233 million miles of travel annually, leading to burning an additional 11 million gallons of gas.  That in turn  would translate into additional annual greenhouse gasses of about 100,000 tons (at roughly 20 pounds of CO2e per gallon of gas).

 

The same calculator shows that the proposed widening of I-5 at the Rose Quarter will likely produce 60 to 90 million additional vehicle miles of travel per year, lead to burning about 4 million additional gallons of gas per year, and generate about 40,000 tons of additional greenhouse gases.

7. Metro isn’t pursuing pricing, which has been proven to be effective

Metro has taken no action to implement any of the pricing options that its own research rates as “highly effective” in reducing greenhouse gas emissions, including road pricing, gas taxes, vehicle miles traveled fees, parking charges and pay as you drive insurance. It’s gone out of its way to gainsay effective pricing measures, and used its public relations budget to promote false claims about vehicle idling.

One key reason for the increase in driving since 2014 has been the significant decline in oil and gasoline prices.  Metro’s model, calibrated based on behavioral responses to the earlier higher prices, and the assumption that declining prices wouldn’t affect demand for travel, have failed to predict the increase in driving.

8.  Metro has done nothing to fix its failing climate strategy

In spite of the failure to advance its goals, Metro has proposed no new or stronger measures to reduce GHGs, even though its climate smart initiative says it will do so.  Metro’s 2014 Climate Smart Strategy (on page 1) promised to periodically check to see whether progress was being made toward the goals it laid out.  If further promised:

If the assessment finds the region is deviating significantly from the Climate Smart Strategy performance monitoring target, then Metro will work with local, regional and state partners to consider the revision or replacement of policies, strategies and actions to ensure the region remains on track with meeting adopted targets for reducing greenhouse gas emissions.

Similarly, the 2018 RTP (Appendix J) makes the same commitment on page 10.

The data from DARTE show that Metro is plainly not meeting the initial greenhouse gas reduction goals set in the initial Climate Smart Strategy, nor is it on track to meet the much watered-down goal laid out in the 2018 RTP.  Similarly the “fleet and technology assumptions” built into both the CSS and the RTP have been proven wrong.  Yet the Metro has not acknowledged either of these basic facts, nor has it proposed any additional steps to reduce current high levels of greenhouse gasses to get them back on track.  Instead, it is going along with proposals from the Oregon Department of Transportation to spend billions widening area highways—which will add to Metro area greenhouse gasses.  (As explained in Appendix B, both the Land Conservation and Development Commission and the Oregon Department of Transportation have likewise failed to acknowledge increasing transportation greenhouse gas emissions, and have failed to update their incorrect modeling assumptions, and to revise policy targets, as both have committed to in their plans and regulations).

Appendix A.  Sources, Data and Methodology

Metro’s description of its climate strategy is taken from the 2014 Climate Smart Strategy and the 2018 Regional Transportation Plan.

Data on Portland area transportation greenhouse gasses are from the DARTE national transportation greenhouse gas emissions inventory, which contains estimates covering the years 1990 through 2017 at a very fine geographic scale.  DARTE is the most comprehensive and uniform national estimate of local transportation greenhouse gas emissions. We report DARTE data for Clackamas, Multnomah and Washington counties, the geography most closely corresponding to the Portland “metropolitan planning area” used in Metro’s 2018 RTP.  For purposes of comparison, we factor up Metro’s figures by 18-20% (depending on year) to be directly comparable to the larger geography of the DARTE database.

We compute emission reduction trajectories needed to meet state greenhouse gas requirements, and trajectories implied by Metro’s plans by computing a constant annual (negative) growth rate—or “glide slope”—needed to move from base year to final year emissions levels.  For example, in 1990, Portland area transportation GHGs were 5.7 million tons; a 75 percent reduction from that level (to meet the state goal) implies a 2050 level of emissions of 1.4 million tons.  To reach that level from 2013 actual emissions of 6.0 million tons requires a reduction of 3.8 percent per year for each year from 2013 through 2050.  We compute glide slopes for other plans (ODOT’s STS; Metro’s RTP) in the same fashion.

The 2018 RTP contains two conflicting estimates of how much reduction the plan will actually provide.  Chapter 7 of the RTP says that the 2015 level was 13 VMT per capita per day, and that the plan would reduce this to 12.3 VMT per capita per day by 2040.  The Climate Smart Appendix to the report, Appendix J, says that the 2015 baseline level was 12.7 VMT per capita per day, and would be reduced to 12.3 VMT per capita per day by 2040.  Chapter 7 figures imply a 4.6 decline in VMT by 2040; Appendix J implies the decline will be only 2.3 percent.  We assume that the correct level of VMT in the base years is 13 VMT per person per day, corresponding to a 4.6 percent decline in VMT by 2040.

Appendix B:  Metro and State incorrect assumptions about cleaner vehicles

Guided by state rules, Metro’s emissions modeling assumes “cleaner cars” through a combination of improved fuel economy (higher MPG standards), faster vehicle turnover (replacing dirty old cars with cleaner new ones), and smaller, more efficient vehicles (more cars, fewer trucks and SUVs).  None of these assumptions have been realized in the time since Metro and state climate plans were published.

1. Fleet fuel economy has not measurably improved.  Modeling for the climate smart initiative assumed rapid and prolonged improvements in vehicle fuel economy, due to rising federal fuel economy standards.  But the impact of increased new car standards on actual levels of real-world fuel efficiency have been modest.  Here is the data on actual average fuel economy through 2019. Average fleet economy was about 22.2 miles per gallon in 2019, far short of the targets set in the Metro modeling.

2. Average vehicle age is 50 percent older than assumed modeling.  According to the Bureau of Transportation Statistics, the average age of an automobile in the United States is now 11.9 years, up from 10 years in 2004.  The Metro Climate Smart Plan assumed that the average age of a vehicle would decline by about 25 percent, from 10 years to 8 years; instead, the average age of a vehicle has increased by almost 20 percent, from 10 years to almost 12.  The average vehicle today is now 50 percent older than assumed in the Metro climate plan.

3. Trucks and SUVs are displacing passenger cars, not the other way around.  A critical assumption in the Climate Smart Plan and the RTP is that consumers would buy more and more passenger cars, and fewer trucks and sport utility vehicles.  In fact, the opposite has happened:  since 2015—when sales of cars and SUVs/Trucks were roughly equal—it’s now the case that truck/SUV sales account for roughly 75 percent of all new vehicle sales.


4. Vehicle electrification is occurring very slowly
.  Many like to assume that electric vehicles will quickly and easily reduce carbon emissions.  Yet electrification is happening too slowly and on far too small a scale to materially affect transportation greenhouse gas emissions. ODOT’s October 2019 revenue forecast predicts the size and composition of Oregon’s light duty vehicle fleet through 2029.  They forecast that in 2029 Oregon will have about 3.9 million light duty vehicles, but only about 120,000 of them (total) will be electric vehicles.  That’s just 3 percent of the fleet; 97 percent will still be internal combustion engines.  The slow adoption of electric vehicles, as depicted in ODOT’s official revenue forecasts, means the agency believes that its efforts to promote EVs won’t have a significant effect on the state’s greenhouse gas emissions any time in the next decade, at least.

5. State forecasts of future vehicle emissions have been proven wrong.  A critical part of any transportation greenhouse gas emission strategy is assumptions about the improvements in the cleanliness of future vehicles.

Metro’s climate planning is based, in part, on rules adopted by the State Land Conservation and Development Commission (LCDC) directing metropolitan planning organizations around the state to work toward complying with the state’s adopted greenhouse gas emission goals.

In 2017, LCDC produced a report detailing its analysis of how these planning organizations were to plan for reducing transportation-related greenhouse gas emissions.  As directed by the Legislature, the planning process was to give local planners guidelines on the proportion of reduction in greenhouse gasses that could be expected from changes in vehicle efficiency and electrification.

LCDC based its rules on emission reduction assumptions taken from the Oregon Department of Transportation’s 2012 State Transportation Strategy (STS).  LCDC constituted a technical committee and retained Brian Gregor (formerly of ODOT) to prepare a technical analysis, drawing on the STS to estimate how much reduction in greenhouse gasses could be expected from improving technology and changing vehicle mix.  Gregor’s analysis predicted that vehicles would become dramatically cleaner over the next several decades, with a reduction in greenhouse gasses per mile traveled of more than 80 percent by 2050.  Gregor’s analysis concluded that LCDC should assume that emissions per vehicle mile would decline by 67 percent by 2035, the terminal year for local land use plans.  Importantly, LCDC wrote Gregor’s assumptions about future vehicle emissions into its administrative rules (OAR 660-044-0020).

Gregor’s analysis assumed that average vehicle emissions would decline to about 90 grams per mile by 2050.  Gregor reached these conclusions by assuming that fuel efficiency and zero emission vehicle regulations would steadily improve new vehicle emissions, and that over time, these would change overall fleet emissions. The report assumed that average vehicle age would be 11 years, and that  average fleet vehicle economy in any year would be equal to the average new car fuel economy for vehicles sold 11 years earlier.  Gregor’s calculations imply a base level of emissions of about 520 grams per mile in 2005.  New cars would be assumed to achieve 100 grams per mile in 2035, and the fleet as a whole would achieve 100 grams per mile in 2046, and about 90 grams per mile by 2050. Gregor summarized his assumptions in this chart:

As Gregor writes:

Average vehicle emissions rates would need to decline by a little over 4% per year from the 2010 estimated average in order to achieve the recommended level in 2050.

It is now 2021, and we have roughly a decade of data on the actual rate of improvement in new vehicle emission rates.  According to the Environmental Protection Agency, average emissions for new light vehicles have fallen from about 450 grams per mile in 2005 to about 348 grams per mile in 2021.  By Gregor’s approach, at that rate of improvement, average fleet efficiency in 2032 (eleven years from now) will be about 348 grams per mile.  In the past decade (2010 through 2021), the number of grams per mile has declined at about a 1.1 percent annual rate.  This is roughly only one-fourth the rate of improvement assumed in Gregor’s calculation and LCDCs target rules.

The following chart shows the difference between Gregor’s estimate of the path of vehicle emissions (blue), and the actual improvement in emissions between 2010 and 2021 (green).  The red dashed line shows the trend in vehicle emissions based on the 2010 to 2021 growth rate of -1.1 percent per year extended through 2050.

At current rates of improvement, per mile emissions are likely to be almost three times higher in 2050 than forecast in Gregor’s model, i.e. almost 300 grams per mile, rather than less than 100 grams per mile.

Achieving a reduction in greenhouse gas emissions is driven by the combination of cleaner vehicles and less driving.  If vehicles become cleaner at a slower rate, then bigger decreases in driving (VMT/capita) are needed to achieve state goals. Gregor creates an equation showing how these factors determine the expected reduction in emissions.

Gregor estimates that we need to reduce per capita emissions to 28 percent of base levels (i.e a 72 percent reduction).  He assumes that cleaner vehicles will do the lion’s share of this work.  His assumed 66 percent reduction in the rate of emissions per mile, means miles per capita need to be reduced about 20 percent.

The much lower rate of improvement in cleaning up vehicle emissions that we’ve actually experienced means that proportionately more of the task of reducing greenhouse gasses will need to be met, per Gregor’s own methodology, by reducing vehicle miles of travel. At the current rate of improvement of vehicle emission reduction, in 2035, the average vehicle will still emit about 336 grams per mile, just a 25 percent reduction from base levels.  In order to meet the state’s target of reducing per capita emissions to 28 percent of base levels by 2035, that means per capita vehicle miles of travel need to fall by 66 percent.  (The following table uses Gregor’s Equation 2 to compute the needed “target” level of VMT reductions consistent with various rates of improvement in vehicle emissions).

As show in the final line of the table, even if the annual rate of improvement doubles from its current rate to 2 percent per year from now through 2035, we would have to reduce vehicle miles traveled per capita by more than 50 percent.

In effect, the dramatic shortfall between Gregor’s 2016 report, and the actual 1.1 percent improvement in GHG/mile is the combined effect of the factors described in this section (a heavier, truck and SUV oriented fleet, slow improvements in fuel efficiency, slower vehicle turnover and slow electric vehicle adoption.

LCDC and ODOT have failed to re-examine their policies in light of forecast errors

It is difficult and uncertain to make reliable and accurate projections about the future.  That is why analysts typically couch their predictions in terms of the assumptions made to produce them, and why policies and reports relying on such forecasts frequently promise to revise their estimates as more and better information becomes available.

It’s important to note that Gregor’s predictions are based only partially on current law or policy, and rely heavily on assumptions that federal and state governments will devise, adopt, implement and enforce a whole series of new and more stringent policies to reduce vehicle emissions.  Gregor’s report made it clear that assumptions about improving vehicle economy were based on optimistic speculation about future federal and state policy.

The members on the Core Tech Team from the Departments of Environmental Quality and Energy agreed that the STS “trend line” is a reasonable reflection of goals that California, Oregon, and other states participating in the multi-state ZEV standards wish to achieve. They caution, however, that this planning trend does not reflect recent trends in vehicle fuel economy. Substantial efforts on the part of states and the federal government will be necessary to make this planning trend a reality. [Emphasis added].

A footnote on page 30 of the report makes this point even more clearly:

It is important to note that these ‘trend lines’ represent the trend in the model results given the vehicle assumptions in the STS recommended scenario. They do not represent an extrapolation of past trend. [Emphasis added].

The LCDC report relying on Gregor’s estimates implicitly acknowledges the need to update these forecasts as better information becomes available.  The LCDC goals were developed over several years from 2011 through 2016; The final rules were revised from earlier drafts explicitly because of the availability of additional information on vehicles and vehicle emission rates.  LCDC elected to tie its estimates of vehicle emission rates to those in ODOT’s STS for consistency with state efforts, and so that as the STS was updated, so too would be expectations about local targets.

If the STS is adjusted to account for changing assumptions to vehicles, fuels, and technology, the targets can be similarly adjusted to compensate for the updated assumptions.  (page 9).  [Emphasis added].

However, while the responsible state agencies (ODOT and LCDC) acknowledged the need to change targets as new information became available when targets and the STS were first prepared a decade ago (in 2011 and 2012), they’ve done little since to respond to new information.  ODOT prepared its first STS Monitoring Report in 2018 and found that progress on fleet, fuels and vehicle technology was much less than what it had forecast in the STS in 2012, and as a result that the state was way behind in meeting emissions goals.  Since that finding ODOT has done nothing to either revise its estimates of future vehicle emissions rates to reflect this new information or, more importantly, identify actions needed to get the state back on track.  Instead, ODOTs Monitoring Report obliquely concludes that unspecified state policy-makers will need to decide what to do next.     

LCDC’s decision to tie its targets to the STS—a decision which at least promotes consistency—means that ODOT’s failure to update the STS means LCDC policy remains based on outdated, inaccurate estimates until ODOT chooses to update the forecasts in the STS—something not on ODOTs schedule, despite Governor Brown’s Executive Order which directs the agency to do everything in its power to implement the STS.  LCDC has also failed to follow its own administrative rules which require it to re-appraise the validity of the emissions assumptions on which the rules were predicated:

660-044-0035

Review and Evaluation of Greenhouse Gas Reduction Targets

(1) The commission shall by June 1, 2021, and at four year intervals thereafter, conduct a review of the greenhouse gas emissions reduction targets in OAR 660-044-0020 and 660-044-0025.

(2) The review by the commission shall evaluate whether revisions to the targets established in this division are warranted considering the following factors: . . . 

(e) Additional studies or analysis conducted by the Oregon Department of Transportation, the Department of Environmental Quality, the Oregon Department of Energy or other agencies regarding greenhouse gas emissions from light vehicle travel, including but not limited to changes to vehicle technologies, fuels and the vehicle fleet; [Emphasis added].

ODOT’s own STS monitoring report concedes that vehicle technologies, fuels and the composition of the vehicle fleet are not changing as anticipated in the STS, making the assumptions underlying LCDC’s rules invalid.  LCDC (and ODOT) have both ignored data from “other agencies”—in this case, the US Department of Energy, sponsor and publisher of the DARTE transportation greenhouse gas database—showing that Oregon greenhouse gas emissions have increased, rather than decreasing, as called for in both agency’s plans, and state statute.

 

Why the proposed $5 billion I-5 bridge is a climate disaster

The plan to spend $5 billion widening the I-5 Bridge Over the Columbia River would produce 100,000 additional metric tons of greenhouse gases per year, according to the induced travel calculator

Metro’s 2020 transportation package would have cut greenhouse gases by 5,200 tons per year– 20 times less than the additional greenhouse gases created by freeway widening.

Widening freeways induces additional travel. It’s an established scientific fact:  widening urban freeways prompts more miles of travel and consequently, more greenhouse gas emissions.  The effect is so well-documented that its referred to as the “fundamental law of road congestion.”

Based on a synthesis of the latest award-winning peer-reviewed scientific research and work by scholars at the University of California, Davis‘s National Transportation Center, the Natural Resources Defense Council developed the induced travel calculator that computes the additional amount of greenhouse gases produced by an additional lane-mile of freeway capacity in each of the nation’s metro areas.

The proposed Columbia River Crossing, now re-branded as the “I-5 bridge replacement project”, contemplates a 12-lane wide, 5 mile long freeway between Portland and Vancouver, effectively doubling the size of the existing I-5 freeway and adding 30 lane miles of freeway (3 lanes in each of 2 directions for 5 miles).  Freeway advocates have claimed that the bridge might only be 10 lanes, but as public records requests revealed, the bridge structure is designed to carry twelve lanes, and in many places the proposed roadway is 14 lanes wide.

The Induced Travel Calculator shows that this increase in roadway capacity in Portland would produce an addition 155 to 233 million miles of travel annually, leading to burning an additional 11 million gallons of gas.  That in turn would translate into additional annual greenhouse gases of about 100,000 tons (at roughly 20 pounds of CO2e per gallon of gas).

How big is that amount?  Well, to put in perspective, let’s compare it to the expected greenhouse gas reductions from other possible transportation investments.  In 2020, Metro advances a multi-billion dollar transportation spending project including light rail, bus lanes, pedestrian and safety improvements and other projects.  Metro estimated that this package of investments would reduce greenhouse gases by about 5,200 metric tons per year.

State, regional and local government officials all recognize that we’re in the midst of a climate crisis.  It should be apparent to any casual observer that widening freeways takes us in the opposite direction of our stated commitments to reduce greenhouse gases.  In fact, the best scientific estimates of the emissions from added freeway capacity suggests that widening I-5 would generate 20 times more greenhouse gas emissions than would have been saved by the multi-billion dollar package of projects proposed by Metro last year.  Given the cost and difficulty of reducing greenhouse gas emissions, the last thing we should be doing is making the problem worse.

Drive-thrus are ruining cities and helping kill the planet

Your 12 ounce latte comes with a pound of carbon emissions, just from the drive-thru.

How convenience for cars makes cities less livable for everyone, and contributes to climate change.

Last week, twitter user Maris Zivarts posted this telling image of 20 car queue wrapping around the block of a Starbucks, all lined up to go through the store’s drive-thru.  It shows how the store’s driveway and parking lot taking up vastly more space than the store itself, and how the backup from the drive-thru window spills out onto adjacent streets, creating congestion and a safety hazard for others.

As Zivarts observes, 20 people showing up at a coffee shop on foot, by bike or transit is no problem.  The same 20 headed for the drive-thru window is a disaster.  It’s clearly a blight on the neighborhood as well.

And more than that, it’s bad for the environment.  Those cars idling while they wait in line are burning gasoline and creating pollution, including greenhouse gases.  How much, you might ask?  Well, we’ve studied queueing and service at coffee shops before (to create our Cappuccino Congestion Index), so we have a pretty good handle on this.  We would estimate that the average wait would an average of and ten minutes to handle all the cars in a queue like this.  (This assumes that the store can produce an order about every 30 seconds).

The US Department of Energy tells us that a typical large US car burns about a third of a gallon per hour at idle.  A gallon of gas produces about 20 pounds of carbon when burned.  So that means that in ten minutes of idling would produce about a pound of carbon (10/60 * 20 * .33 = 1.1).  So, in addition to their twelve-ounce latte, each customer is producing another 16 ounces or so of carbon to be added to the global total, just from the time spent idling in their car, waiting to be served their coffee.   And, of course, this doesn’t count any of the emissions from driving to and from the coffee shop to get served, which by the same math works out to about another pound per mile.

Oregon’s economic success: The triumph of the city

After decades of lagging the nation, Oregon’s income now exceeds the national average.

While some seem to think its a mystery:  It’s not.  It all about a flourishing Portland economy, especially in the central city of the region

This success has been powered by an influx of talent, especially well-educated young adults drawn to close-in urban neighborhoods

Income growth in Multnomah County accounts for essentially all of the net improvement in Oregon incomes relative to the nation over the past decade or more

Rising incomes, especially in the city, have markedly reduced racial and ethnic income gaps

The secrets of economic success:  talent, quality of life, urban amenities, and knowledge industry clusters.  This urban-powered success should bury old-school myths about business climate.

A new story in the Oregonian notes that the state’s median household income has surpassed the national average, something it treats as a kind of esoteric statistical mystery, one that has economists, in its words, “flummoxed.”  As someone who’s followed this metric for decades, and analyzed Oregon’s economic growth, it’s really no mystery at all.  Oregon’s recent surge in median income is the product of a strong Portland economy, one that’s been transformed and powered by its ability to attract talent.  It’s been a long time in the making.

Median household income is a key indicator of economic progress.  Here’s a half century long picture of how Oregon’s income has tracked relative to the nation.  Nearly all that time, Oregon has lagged.  During the 1980s, Oregon was particularly hard hit.  Since then, Oregon’s changes have tracked national trends, but through about 2012, income was always somewhat below the national median.  But in the last couple of years, Oregon’s income growth has surged and now surpassed the national median.  (The following chart, courtesy of Oregon economist Josh Lehner,  is in inflation-adjusted dollars).

Oregon’s strong trend is borne out by other indicators. Another data series, the Current Population Survey (CPS), which has a much smaller sample and somewhat different approach than the ACS suggests that Oregon’s median income is outpacing the national average by an even larger margin.  State labor economist Will Burchard wrote that the latest figures show that Oregon’s median household income reached $76,554 in 2019, which is higher than the U.S. median household income of $67,521.

Portland powered the state’s economic gain

The Oregonian article makes it sound like the state’s improving incomes are a kind of mystery. But there’s no mystery here.  The first bit of evidence comes from looking at where Oregon incomes surged over the past couple of decades.  Oregon’s economy is big and diverse, and different parts of the state have fared differently.  When we look closely at the county-level data it’s apparent that the income surge is centered in Portland, not just in the Portland area, but in the City of Portland (which is largely coterminous with Multnomah County).  Between 2010 and 2019 median household income (in current dollars) rose 39 percent in Multnomah County, compared to 29 percent in the remainder of the metropolitan area (the suburban counties of Clackamas, Columbia, Washington and Yamhill), and just 23 percent in the remainder of the state.

This is an urban success story.  In a statistical sense, Multnomah County’s income growth explains nearly all of the degree to which Oregon incomes now outpace the nation.  Excluding the effect of increasing median incomes in Multnomah County, statewide incomes median incomes would have risen about 3 percentage points less—enough to keep statewide median income growth from exceeding the national average.

In a way, this isn’t new news at all, even for the Oregonian.  State labor economist Christian Kaylor highlighted Portland’s exceptional growth a couple of years ago, as reported in . . . The Oregonian.

Talent drove Portland’s growth:  The Young and Restless

It’s become increasingly clear in the past two decades that a well-educated population, what economists call “human capital,” is a decisive factor in economic development. It’s no secret that cities that do a great job of educating their populations, and which attract well-educated people from elsewhere do better economically.  That’s more the case with each passing year.

As we’ve documented at City Observatory for years, smart young people have been moving to cities, and Portland has been one of the leading destinations for well-educated 25- to 34-year-olds.  Since the 1990s, Portland has outpaced the nation in attracting these young adults, and their arrival numbers have continued to grow. As we documented in our 2004 report, and in subsequent follow up reports on the Young and Restless, Portland has been a national leader in attracting well-educated young adults and they’ve settled disproportionately in the city’s close-in neighborhoods.  And after two or three decades of steady influx of young talent, this group, as it has matured into its prime working age years, has transformed the economic performance of the city.  Again, Portland’s key role in powering the state strong economic performance puts the lie to the old Portlandia joke that Portland was a place that young people went to retire (we debunked that at the time:  Portland has above average rates of employment and entrepreneurship among young adults). This steady influx of well-educated workers measurably increased the city’s educational attainment, making it one of the best educated large cities in the country.  A better educated population fueled income growth, something that is now clearly bearing fruit in the economic statistics.

When we look across Oregon, there’s more evidence for this talent/income nexus in the county level income statistics.  The Oregon counties that chalked up the big gains in median household income were the counties with the highest levels of educational attainment.  The following chart shows the fraction of the adult population with a four-year degree in each county and the percentage increase in median household income in that county over the past decade.  There’s a strong positive relationship between education and income growth.

On this chart, each dot represents an Oregon county.  As the regression line shows, counties with higher levels of educational attainment had faster rates of median income growth over the last decade than counties with relatively low levels of education.  Keep in mind, there’s always been a strong relationship between education and income; better educated counties have always had higher incomes.  What this data shows is that those better educated counties are increasing income even faster:  they’re pulling away.  It’s a core fact of a knowledge-driven global economy.

Oregon’s economic growth has promoted equity as well.

Any time we take rising incomes as a measure of economic success, it’s worth asking whether prosperity is widely shared.  The Oregon numbers show a further remarkable success story.  During the past several years, there’s been a dramatic reduction in the economic gap between White residents and people of color in Oregon.  Economist Josh Lehner used data from the American Community Survey to show the trend in poverty rates for persons of color compared to white Oregonians.

Despite the modest claim in the chart’s title “poverty gap remains large, but is narrowing,” this represents prodigious progress in just a few years.  In 2009, poverty rates for persons of color in Oregon were effectively double those for non-Hispanic white Oregonians.  After several years of sharp and steady declines, BIPOC poverty rates fell by ten percentage points, from over 25 percent to 15 percent, and so were now only about four or five percentage points higher than for whites.  And this is after four-decades win which there was no perceptible narrowing of these racial-ethnic differences.  It’s an indication of how tighter labor markets can play a key role in providing more opportunities for those who’ve long been marginalized.  These gains for people of color also strongly correlate with the robust growth of the Portland/Multnomah County economy.  Portland and Multnomah County are much more racially and ethnically diverse than the rest of the state, so a strong city economy translates into more local opportunity for people of color.

What this tells us about how to succeed at economic development

For someone who’s labored for decades in the vineyard of economic development, there’s one key indicator we pay attention to when summarizing a state or region’s economic success:  its level of income relative to the national average.  One of the best metrics is median family income, which effectively reveals how a typical household in the middle of the income distribution is faring relative to the nation.

For most of the past six decades, by this measure, Oregon’s economic performance has lagged that of the nation.  Our friend and mentor, the late Ed Whitelaw trenchantly pointed out that just looking at money income ignored the substantial “second paycheck” Oregonians earned from the state’s abundant and increasingly valuable natural amenities.  To that second paycheck, Oregonians can add another factor ignored in most conventional statistical comparisons:  the very sizable green dividend that Oregonians earn, largely because the state’s more compact development patterns (thanks to land use planning) mean that residents drive fewer miles than people in other more sprawling states, saving them a bundle on the cost of cars and gasoline.  Portland’s income is about $1 billion per year higher because of these savings.

Back in the 1980s, as the chief economic analyst for the Oregon Legislature, I documented the state’s lagging income levels in a series of detailed statistical reports: Losing Ground: The Growing Gap Between Oregon and National Income.   These reports showed that for a variety of reasons (the structural decline of the timber industry, the state’s disconnect from the Reagan era defense build-up, and other factors), that Oregon’s economy lagged the nation, and showed up in most prominently in a big decline in average incomes relative to the rest of the nation.  It was clear then that raising the state’s educational attainment, promoting innovation and building world-class knowledge industry clusters was the key to raising our income.  And over the past twenty years, led by the Portland economy, Oregon has transformed into a better educated, more innovative and more productive state, something that has been largely propelled and supported by investments in quality of life that have attracted and retained talent.

That success flies in the face of old school myths about the importance of business climate to economic success.  Portland’s strong showing, in particular, belies the bad-mouthing the city got during the last recession and disproves some outdated economic development nostrums.  Take, for example, the cynical doom-saying by the Portland Business Alliance, the city’s chamber of commerce, which in 2010 grimly intoned that Multnomah County ranked 198th of 199  Western counties and metro areas in job growth, attributing the problem to a bad business climate and a failure to attract large corporations.  It fretted that a continuing long-term decline in Multnomah County’s economic health would drag down the region and the state:

The Portland-metro region faces a crisis. If unstopped, the loss of jobs in Multnomah County and the stagnant-to-declining wages and incomes across the region will erode our quality of life, not just in Portland-metro, but across Oregon because of the region’s key role in the overall state economy.

These worries were echoed by pundits claiming that Oregon  somehow had an anti-business attitude, was over-taxed and over-regulated, or somehow lacked enough roads or industrial sites to accommodate growth. Far from dragging the region or the state down, Multnomah County’s ability to attract talent propelled the state’s economic success. The region’s strong performance also over the past decade also debunks other myths, like the notion that ours is a freight-dependent economy.  Portland flourished as never before even though ocean container service disappeared and port activity withered in the middle of the decade.  As the record of the past decade shows, these myths and self-serving claims were exactly backwards.  Far from being dragged down by a stagnant economy in the region’s center, the metro area and the state were propelled by income growth in Portland and Multnomah County.  Without the center’s strong showing, statewide growth would have been no better than the national average.

In the end, economic success in the 21st century is no mystery, nor is Portland’s recent surge.  Economic development is a long term proposition, not amenable to quick and easy fixes.  It’s fundamentally about having a well-educated populace and and environment conducive to innovation.  It’s about having the amenities (urban and natural) that knowledge workers find attractive.  It’s about building clusters of dynamic, innovative industries that draw on these resources, and enhance them further. That’s what Portland has done, and its success is powering the state’s impressive income gains.

Technical notes

The key metric we’re tracking here is median household income, the income of the household in the middle of the income distribution for a county, state or the nation.  Half of all households have income above the median, half have incomes below.  The median is a useful statistic for very simply describing the distribution of income.  But using it to compare different geographies (counties and states) over time is challenging.  Medians are influenced by composition effects.  In our case, because some higher income counties are adding households faster than lower income households over the past decade, the growth of the statewide median is greater than the average of the county medians.

For simple comparative purposes, we’ve computed the household-weighted statewide median income (weighting each counties median income by the number of households in that county).  Because we use weights that are based on the number of households in the 2019 ACS, this metric ignores the shifting composition of the state’s population and focuses on the changes in incomes across counties.  We compute that the household-weighted median income for Oregon counties in 2010 and 2019 including and (counterfactually) excluding, Multnomah County. Without the growth in incomes recorded in Multnomah County, statewide median income growth would have been about 3 percentage points less than it actually was over the decade, which would have been enough to erase the gains that enabled statewide income to exceed the national average for the first time.

 

 

 

Let’s stop whining about gas prices: Gasoline is cheap, too cheap.

Gas prices are going up, and it’s annoying to have to pay more, but let’s take a closer look at how much we’re paying for gas.

Even with a recent uptick, gas prices are still lower than they were a decade ago.

Cheap gas is burning the planet, and undercuts all of our efforts to lower greenhouse gas emissions.

After decades of disinflation or deflation, the US economy, in the wake of an dramatic effort to bounce back from the pandemic, is experiencing a surge of inflation.  The media love to point at rising prices at the pump.  Gas was going for around two bucks a gallon in the early days of the pandemic, and nationally has just broken through $3/gallon.

Everyone likes to complain about gas prices, but gasoline in the US is cheap. It’s cheap in historical terms, as the chart below shows: In inflation-adjusted terms, gasoline is cheaper now than it was a decade ago, and is well below its historic peak of more than $5 per gallon (in 2021 dollars).  From 2011 through 2014, the price of gallon of gas (in today’s money) was regularly north of $4.

The price of gasoline fell precipitously after 2014, leading to a dramatic reversal in all of the trends that were helping ameliorate the climate crisis.  Public transit ridership, which had been rising, fell.  The average American, who had been driving less each year after 2004, suddenly started driving more.  The share of new vehicles that were heavier, less fuel efficient light trucks went from less than half to almost 75 percent.  The big increase in driving after gas prices fell in 2014 is directly connected to a surge in transportation-related greenhouse gas emissions.  In Portland, for example, greenhouse gases per person increased by 1,000 pounds per year over the past few years.  Propelled by cheap gas, and combined with larger vehicles, there was a huge increase in crash fatalities and injuries.

Gasoline is cheap in the US compared to other countries.  In Italy, France, Germany, Denmark, the Netherlands and the UK, gas prices are roughly $2 per liter, compared to less than $1 per liter in the US.  These higher fuel prices prompt people and businesses to make different decisions: people drive more efficient vehicles, drive fewer miles, and kill and maim fewer of their brothers and sisters in crashes.  Cheap gas is a principal reason for America’s excessive greenhouse gas emissions and epidemic of traffic violence.

Higher priced gasoline prompts businesses and consumers to make choices and investment decisions that lower our fossil fuel emissions.  Higher gas prices make electric vehicles more competitive, and prompt people to buy more fuel-efficient vehicles.  Higher gas prices also discourage long commutes and make transit more attractive.  The evidence from places like Amsterdam and Copenhagen, where cycling works well for a large fraction of the population is that it isn’t just about bike lanes; high prices for gasoline and high taxes on fossil fuel vehicles provide strong incentives for more efficient travel.  It’s perfectly possible to have a prosperous productive economy and a high standard of living with gas prices that actually come close to asking users to pay something approaching the cost of their decisions.

The Bipartisan Infrastructure Bill just doubles down on continuing subsidies to driving.  It’s got a huge bailout of the Highway Trust Fund (which has roughly $100 billion in general funds since 2000), and these a $118 billion general fund bailout as part of the bill, plus a huge tranche of new money that will keep drivers from facing the true cost of building and maintaining roads and bridges, not to mention paying for environmental and health damage.

Not surprisingly, once conditioned to depend on cheap gasoline, people express dismay at the higher prices.  But getting gasoline prices to more accurately reflect the social, environmental and personal health damage associated with automobiles is essential.

The real macroeconomic concern about inflation is that somehow we end up in an accelerating spiral. Insulating Americans from the true cost that their gasoline purchases impose on other Americans, the rest of the world and the environment isn’t saving anyone in the long run.  We’ll end up paying for cheap gasoline in higher costs of figuring out how to reduce greenhouse gases in even more expensive, less efficient ways, and in paying more to deal with the damage caused by climate change.

How to solve traffic congestion: A miracle in Louisville?

Louisville charges a cheap $1 to $2 toll for people driving across the Ohio River on I-65.  

After doubling the size of the I-65 bridges from six lanes to 12, tolls slashed traffic by half, from about 130,000 cars per day to fewer than 65,000.

Kentucky and Indiana wasted a billion dollars on highway capacity that people don’t use or value.

If asked to pay for even a fraction of the cost of providing a road, half of all road users say, “No thanks, I’ll go somewhere else” or not take the trip at all.

The fact that highway engineers aren’t celebrating and copying tolling as a proven means to reduce congestion shows they actually don’t give a damn about congestion, but simply want more money to build things.

Picture this.  A major interstate freeway that connects the downtown of one of the nation’s 50 largest metro areas to its largest suburbs.  It’s a little after 5 pm on a typical weekday.  And on this 12-lane freeway there are roughly two dozen cars sprinkled across acres of concrete.

I-65 in Southern Indiana (Trimarc)

 

I-65 crossing the Ohio River at Louisville (Trimarc)

These pictures were taken by traffic cameras pointed in opposite directions on the I-65 bridges across the Ohio River at Louisville Kentucky on Wednesday, November 3 at about 5:30 pm.  Traffic engineers have a term for this amount of traffic:  They call it “Level of Service A”—meaning that there’s so little traffic on a roadway that drivers can go pretty much as fast as they want.  Highway engineers grade traffic on a scale from LOS A (free flowing almost empty) to LOS F (bumper to bumper stop and go).  Most of the time, they’re happy to have roads manage LOS “D”.

Somebody finally figured out how to reduce traffic congestion!  Usually, as we know, simply widening highways, to as many as 23 lanes as is the case with Houston’s Katy Freeway, simply generates more traffic and even longer delays and travel times.  And, with no sense of irony, highway boosters even tout the Katy Freeway as a “success story,”  despite the fact it made traffic congestion worse. In contrast, Louisville’s I-65  is an extraordinarily rare case where traffic congestion went away after a state highway department did something.

You’d think that the Kentucky Transportation Cabinet and the Indiana Department of Transportation would be getting a special award, and holding seminars at AASHTO to explain how to eliminate traffic congestion.  The fact that they aren’t tells you all you need to know about the real priorities of state highway departments–they really only care about building things, not about whether congestion goes away or not.

So how did they do it?  Let’s go back a few years.  In 2010, I-65 consisted of a single six-lane bridge over the Ohio River, which carried about 120,000 vehicles per day.  The two states decided this was getting too crowded (and predicted worsening delay due to ever expanding traffic volumes) and so spent about $1 billion building a second six lane bridge (the Lincoln) next to the existing Kennedy bridge.  After in opened in 2017, the two states implemented a toll to pay part of the cost of construction.  Tolls started at $2 for single crossings (if you had a transponder), but regular commuters were given a discounted toll: regular commuters pay just a bit over $1 for each crossing.  Today the toll for one-way crossings if you have a transponder (and 450,000 area vehicles do), is $2.21.  But if you cross the bridge 40 times a month (back and forth daily for 20 work days), your toll for each trip is reduced by half to $1.10.

And after the tolls went into effect, traffic on I-65 fell by half.  Here’s the average daily traffic count on I-65, according to data tabulated by the Indiana Department of Transportation.  In the years just prior to the tolling, traffic was in the 135,000 to 140,000 vehicles per day level.  But as soon as tolling went into effect, traffic dropped to barely 60,000 vehicles per day (with a very slight further decline due to Covid-19 in 2020).

 

The two states spent a billion dollars doubling the size of I-65, only to have half as many people use the bridge.  That money was wasted.  Nothing more clearly illustrates the utter folly of highway expansions.  As we’ve pointed out, highway engineers size roadways based on the assumption that the users will pay nothing for each trip.  Just as with Ben and Jerry’s “Free Ice Cream Day,” when you charge a zero price for your product, people will line up around the block.  But ask people to pay, and you’ll get fewer takers.

The fact that Louisville residents would rather drive miles out of their way or sit in traffic for an extra 10 or 15 minutes to travel on a “free” road, rather than spend a dollar or two for a faster, more direct trip tells you the very low value that highway users attach to these extremely expensive roadways.  In fact, they’ll only drive on them if somebody else pays for the cost the roadway.   This is also powerful evidence of what economists call induced demand:  people only taking trips because the roadway exists and someone else is paying for it.

The Louisville traffic experiment shows us that there’s one surefire fix for traffic congestion:  road pricing.  Even a very modest toll (one that asks road users to pay only a third or so, at most of the costs of the roads they’re using) will cause traffic congestion to disappear.  This traffic experiment shows the folly and waste of building additional capacity.  Kentucky and Indiana spent over $1 billion for a bridge to carry as many as 250,000 vehicles per day, and today barely a quarter of that number are using it.

If state DOTs really cared about congestion, they’d be implementing congestion pricing.  A small toll, probably less than a dollar per crossing, would be sufficient to get regular free-flow conditions on the I-65 bridge—without having to spend a billion dollars.  But the truth is, state DOTs don’t care about congestion, except as a talking point to get money to build giant projects. The next time you hear someone lamenting traffic congestion, ask them why they aren’t trying the one method that’s been shown to work.

 

 

 

Louisville’s financial disaster: Deep in debt for road capacity that will never be used

Louisville’s I-65 bridges:  A huge under-used roadway and hundreds of millions in debt for their kids—who will also have to cope with a climate crisis.

Their financial plan kicked the can down the road, saddling future generations with the cost of paying for unneeded roads.

The two states mortgaged future federal grant money and borrowed against toll revenues, which are falling dramatically short of projections.

Louisville’s Ohio River Bridges are a monument to the epic policy, financial and generational failure that is the US highway system.  Ohio and Indiana spent more than a billion dollars on doubling an interstate highway bridge, that thanks to very modest tolls, is utilized at less one-fourth of its capacity.  Meanwhile, through a series of “creative” financial maneuvers, it passed the bill for the highway onto future generations, who, as it turns out will have to actually pay for the bridge at the same time the climate crisis hits in full force.  The almost empty freeway bridges show the folly of “asphalt socialism”—wasting vast amount of public resources on roads that their users don’t value enough to pay even a fraction of their cost.

Earlier, we wrote about one aspect of the I-65 bridge project in Louisville.  It turns out that just by charging a $1 to $2 toll, Kentucky and Indiana were able to entirely eliminate traffic congestion on I-65.  Traffic plummeted from around 130,000 vehicles per day to about 60,000.  Now, even at the rush hour, I-65 is almost empty.

 

I-65 crossing the Ohio River at Louisville

 

And after the tolls went into effect, traffic on I-65 fell by half.  Here’s the average daily traffic count on I-65, according to data tabulated by the Indiana Department of Transportation.  In the years just prior to the tolling, traffic was in the 135,000 to 140,000 vehicles per day level.  But as soon as tolling went into effect, traffic dropped to barely 60,000 vehicles per day (with a very slight further decline due to Covid-19 in 2020).

 

While there’s a hopeful lesson here—one that highway engineers are studiously avoiding—that road pricing can eliminate congestion, there’s a financial horror story that should be a warning to everyone thinking about highway expansion projects.  The two states spent over a billion dollars on doubling bridge capacity in downtown Louisville, and their financial plans show how through combination of cynicism, incompetence or saddled future generations with the cost of this boondoggle.

Ostensibly, the justification for widening the bridges was the notion that traffic was already too congested and was growing rapidly.  The project’s environmental impact statement claimed that the I-65 bridges were “over capacity” in 2012, and predicted that traffic would grow from 120,000 vehicles per day to more than 180,000 by 2025, leading to hours and hours of traffic delay.

The trouble with these forecasts is that they were both simple-minded and wrong, especially given the need to pay for this project—in part—by actually charging the users for a portion of its construction cost.  Like so many state highway department predictions, this one was flat out wrong—traffic was nearly flat-lining on I-65 before the project was built.

State DOT traffic forecasts were wrong

Surely, you must be thinking, the state DOTs knew that charging a toll would reduce traffic.  Before the project was completed, Kentucky and Indiana hired consultants—CDM Smith and Steer, Gleaves, Davie—to estimate future toll revenues from the project.  CDM Smith predicted that future traffic levels on newly expanded and tolled I-65 bridges would be 92,000 vehicles per day in 2020, growing to 102,600 in 2030..  That was a dramatic over-estimate.  Actual traffic levels in 2019 (i.e. the year prior to the pandemic) were just 62,000 vehicles per day.  Whereas CDM Smith predicted that tolling would produce about a 27 percent decline in traffic from pre-tolling levels, the imposition of tolls actually led to a 50 percent decline in traffic.  CDM Smith overestimated the amount of toll-paying traffic that would cross the I-65 bridge by 50 percent.  The direction and magnitude of that error is all too common in toll traffic forecasts, and has led to defaults and bankruptcies for other tolled projects.

Creative Finance:  Sending the bills to future generations.

Tolls are only paying for a small fraction of the costs of the project.  Both states borrowed substantial sums. Kentucky borrowed deeply to pay for its share of the project, using “Garvee” bonds—essentially mortgaging future federal grant money—to the tune of $300 million in principal repayment and $138 million in interest payments.  In addition, Kentucky’s tolls are pledged to pay of both Kentucky revenue bonds of $272 million and a Federal TIFIA loan of $452 million.  The debt service for these two borrowings is back-loaded, i.e. is very low in the first few years of the project, but then steadily escalates.

This back-loading means the financial plan for the I-65 bridges project essentially sends the bill to the region’s future residents.  Essentially, Kentucky has borrowed most of the money to construction the project and arranged for a loan with a series of “balloon payments,” in later years.  Kentucky “back-loaded” the repayment of principal on both its own revenue bonds and its borrowings from the federal government’s TIFIA program.  It pays interest-only or just a token amount of the principal for these loans in the first few years, and then required payments steadily escalate in later years.  Debt-service obligations start at less than $10 million per year, and then balloon to more than $80 million annually in the early 2020s.

In theory, the escalating repayment can be met by growing toll revenues, from some combination of toll rate increases and growing traffic.  Toll rates have increased steadily at 2.5 percent per year, but as the traffic counts show, volume has flat-lined.  The artificially low repayments in the first few years of the project create the illusion that toll revenues are sufficient to cover debt service payments, but as required payments steadily escalate over the next few years, the Kentucky will find it increasingly difficult to meet its repayment obligations.

This looming mountain of debt service obligations has already prompted Kentucky to refinance part of its debt, essentially kicking the can further down the road for repayment of the cost of the I-65 bridges.  The refinancing plan essentially doubles down on earlier back-loading strategy, borrowing more money now to make these payments, and extending the period for repayment further.  Instead of paying off its “first tier revenue bonds” in 2045, they’re extending the term of the repayment by 8 years, to 2053.  And like the initial borrowing, these refunding bonds are mostly “interest-only” for the next 25 years, with nearly all of the principal being repaid after 2045.  As a result, the borrowers will pay almost as much in interest charges ($182 million over the life of the loan) as they pay in principal ($192 million).

Traffic on I-65 will never get back to pre-tolling levels

Whether toll revenues will be sufficient to repay these bonds hinges on whether you believe the latest forecast from Kentucky’s consultant, Steer & Company, prepared as part of the latest re-financing plan.  This new forecast now predicts  that total annual transactions (the number of vehicles using the project) will increase from about 30 million today to about 48 million by 2053.  What this means is that the I-65 bridges will effectively never recover to the level of traffic they had before the crossing was widened.  Currently, as noted above, the bridges are carrying about 60,000 vehicles per day.  The latest Steer forecast is that traffic will increase from that level by about 60 percent over the next three decades (48 million = 1.6 x 30 million).  This means that in 2053, the bridges will be carrying about 96,000 vehicles (which, ironically, is about the same level that the other toll consultants, CDM Smith predicted for 2020 in the projections that were originally used to justify project financing).  On the following chart, the red line is the FEIS traffic forecast for I-65, the black line is the actual level of traffic according to INDOT, and the blue line is the growth in traffic forecast by Steer & Company for the refinancing plan).

 

Comparing these new refinancing estimates with the rosy projections used to justify the project in the first place show the profound gap between highway boosters and reality.  The project was sold based on an environmental impact statement forecast that in the “no action” scenario (with just the single six-lane Kennedy Bridge), traffic on I-65 across the Ohio River would grow to 178,600 vehicles per day, exceeding its “capacity” by 142 percent.  This estimate implies that the capacity of the 6 lane Kennedy Bridge was 125,000 vehicles per day.  (As traffic expert Norm Marshall has shown these “over-capacity” estimates amount to forecasting the impossible, but neatly serve the interests of highway advocates).

Doubling the size of the I-65 crossing was needed, according to the project’s supplemental EIS in order to assure that the project could carry about 185,000 vehicles per day when completed:

Specifically, the combination of new bridges in the Downtown and Far East corridors would result in the Kennedy Bridge operating at 74 percent of capacity in 2025.

With a capacity of 250,000 vehicles per day (double the 6-lane Kennedy Bridge), the 74 percent of capacity implies a forecast level of travel of 185,000 vehicles per day in 2025.  Now, based on the impact of tolling, it’s doubtful that the bridges will ever carry more than a third of their designed capacity, and the much lower level of traffic on I-65 predicted for the 2050s shows that the project was a colossal blunder, wasting a billion dollars.  It’s a blunder that future Louisville area residents will be paying for—for decades to come.

 

 

 

The opposite of planning: Why Metro should stop I-5 Bridge con

Portland’s Metro regional government would be committing planning malpractice and enabling lasting fiscal and environmental damage if it goes along with state highway department freeway widening plans

  • The proposed $5 billion, 5-mile long, 12-lane freeway I-5 bridge project is being advanced based on outdated traffic projections using 2005 data.
  • ODOT is pushing freeway plans piecemeal, with no acknowledgement that they are creating new bottlenecks.
  • Freeway plans fail to address climate change and don’t acknowledge that new capacity will produce additional travel and increased greenhouse gases
  • I-5 bridge plans are inconsistent with adopted state, regional and city commitments to use road pricing to manage demand, which would obviate the need for expensive capacity
  • ODOT and WSDOT have not produced a viable financing plan for the project, which would be the region’s most expensive, and which has a $3.4 billion financial hole.

In theory, Portland has a smart approach to regional planning.  It has a directly elected regional government, with strong planning authority over transportation and land use.  That government claims to care deeply about the climate crisis, and regularly touts the sophistication of its transportation modeling team.  And it says it’s looking at how the whole system works to make Portland a greener more just place.

But when it comes to the single largest transportation investment in the region, a proposed $5 billion 5-mile long, 12-lane wide freeway project across the Columbia River, it’s simply abdicating its responsibility and betraying its stated principles.

Next month, the Metro government is being asked to approve $36 million in additional funds for further planning of this massive freeway project.  It should say no.

Supersize Me: The planned $5 billion widening of I-5 (Courtesy:  Bike Portland)

 

This approval is one more brick in the wall of an even larger freeway building plan.  The Oregon Department of Transportation is pushing an entire series of freeway widening efforts, including the $1.2 billion Rose Quarter project, $5 billion for the mis-named “I5 Bridge Program” and billions more for widening I-205 and I-5 at the Boone Bridge in Wilsonville.

In theory, a regional planning agency would be guided by current, accurate data and scientifically based models.  It would insist on knowing how each project fitted into a larger, long-term vision of how roads and transportation system would work.  It would insist on knowing what a project will cost, how it will be paid for, and who will pay for it.  And if it has committed itself to pricing roadways, it should know how pricing will affect demand before it commits billions on capacity that may not be needed or valued.  And if it is serious about its oft-repeated commitments to tackling climate change, it should insist that its investments actually result in fewer vehicle miles traveled, and less greenhouse gases.

In practice, Portland Metro has done none of these essential things as it has considered the I-5 Bridge.

No forecasts. Most fundamentally and technocratically, ODOT has not prepared, and Metro has not reviewed or analyzed current traffic forecasts that show the actual and projected demand for the I-5 bridge. The foundation of any road project is estimates of the future level of traffic the roadway is expected to carry.  Just last week, the staff working on the bridge project admitted that after more than two years of work to revive the failed CRC, they have no new traffic forecasts, and won’t have any for at least another year.  That hasn’t stopped them from claiming that they know just how big the project should be (they say “ten lanes”) and from claiming that other alternatives won’t meet the project’s purpose and need.  (As we’ve noted before, the two DOTs may claim it’s a “ten lane” project, but they’re planning on building a structure that would easily accomodate a dozen freeway lanes).

The last traffic projections prepared for the I-5 bridge as part of the project’s environmental impact statement date back more than a decade, and are based on data from 2005.

Ruling out alternatives and deciding on the size and design of a highway project before preparing and carefully vetting traffic forecasts is the opposite of planning.

No comprehensive look:  building a badder bottleneck for billions.  As noted earlier, the I-5 bridge project is just one of a series of Portland-area freeway widenings.  Metro should be asking what the region, its environment, and its transportation system would look like with and without all these projects.  Instead, it is considering them only piecemeal.

In effect, this approach amounts to approving the creation of new bottlenecks on the freeway system that will undoubtedly trigger efforts to widen freeways yet again in the future.  The I-5 bridge project would widen I-5 from six to as many as twelve lanes from Vancouver to Victory Boulevard (the project claims its just ten lanes, but in the past it has lied about the actual physical width of the project it plans to build). ODOT is also planning to widen I-5 at the Rose Quarter to as many as ten lanes.  Once these two I-5 projects are complete, a new bottleneck will be formed between them in the three-mile long six-lane wide section of I-5 between the Fremont Bridge and Victory Boulevard, with 12 lanes feeding into six at the north, and 14 lanes (I-5 plus I-405) feeding into this stretch of freeway from the south.  ODOT will then no doubt call for the construction of further “auxiliary” lanes) to carry traffic between exits on this newly bottlenecked segment of I-5.  In essence ODOT is building very large funnels at either end of this six-lane stretch of I-5 North, which will predictably lead to further traffic congestion, more pollution, and additional demands to waste billions of dollars widening roads to accommodate this traffic.

As Metro staff noted in their comments on the I-5 Rose Quarter project, the Oregon Department of Transportation routinely lies about the fact that it is expanding freeway capacity.  It wrote of ODOT’s claim that it was not expanding I-5:

This statement is not objectively true and is potentially misleading; auxiliary lanes clearly add capacity.

Piecemeal reviews that approve segments on an ad hoc basis, and don’t consider the long-term effects of encouraging even more car traffic are the opposite of planning.

Not following through on fighting climate change.  The original CRC was conceived with no notion of the seriousness of the climate challenge.  The proponents of the new I5 bridge have steadfastly opposed incorporating climate considerations in the project’s purpose and need statement.  It’s clear from their choice of alternatives (every one includes at least ten lanes of freeway), and claims that the inclusion of sidewalks, bike paths and transit as somehow make the project “climate friendly,” that nothing has changed with this new iterations of the project.  Never mind that the authoritative Induced Travel calculator based on research from the University of California Davis, shows that expanding I-5 to 10  or 12 lanes for five miles would add 155 to 233 million miles of driving and 800,000 to 2.5 million tons of greenhouse gases.  Freeway widening would worsen the climate crisis.

Of course, these calculations don’t include the effects of congestion pricing.  Tolling I-5, which will be needed to pay for this project, would likely reduce and divert traffic (as we explain below), and ODOT’s own consultants show that tolling would reduce I-5 traffic by enough to entirely eliminate the need for widening I-5 at all.  If the project manages somehow not to be tolled (as many in Clark County want) it would tend to produce vastly more traffic and pollution, as estimated by this calculator.

At $5 billion, the proposed I-5 bridge project is the largest single spending item in the Regional Transportation Plan.  If Metro isn’t going to undertake a serious appraisal of the greenhouse gas impacts of building or not building this freeway then it doesn’t really have a climate strategy.

Metro is officially on record as supporting efforts to address climate change.  Metro has said it wants to reduce greenhouse gases by 20 percent by 2035.  But so far, its efforts have yielded no decline in emissions.  And greenhouse gas emissions from transportation  in metro Portland have actually increased by 1,000 pounds per person in the past five years.  Metro has so far done nothing, and this and other freeway widening projects will make pollution worse.

At best, the I-5 bridge advocates pay lip service to climate issues, completely ignoring the effects of added road capacity on likely travel volumes and greenhouse gases, and instead making vague and unquantified claims that pedestrian and bike facilities on the bridge, plus transit improvements will somehow ameliorate the climate damage done by doubling freeway capacity.

Approving funding for a climate polluting freeway widening project, and failing to insist on developing a more climate friendly alternative way of spending $5 billion is the opposite of planning, and a betrayal of Metro’s stated climate commitments.

A failure to plan for road-pricing.  The State Legislature, ODOT, the City of Portland and Metro have all said that road pricing will be a key component of the region’s future transportation system.  Pricing can help better manage roadways, reduce peak hour traffic, lower the need for additional capacity, and provide funding for maintenance and equitable alternatives.  Metro should not approve a $5 billion freeway project without a clear idea of how the project integrates with a system of road pricing—and yet ODOT and WSDOT have done essentially nothing to integrate these two concepts.

ODOT faces a profound dilemma with regard to road pricing.  Its financial analysis counts on at least $1.4 billion in revenue from tolling the I-5 bridge.  But the project is being sized and designed as if it needs to handle 180,000 vehicles per day, based on traffic projections—outdated, using 2005 data, and built using a model that ODOT concedes can’t address the effect of tolling.

But imposing tolls will profoundly reduce traffic growth.  ODOT’s own consultants, in work completed after the CRC FEIS, have said that the proposed tolls on the I-5 bridges would reduce traffic levels on the bridge from their current level of approximately 130,000 trips per day to only 85,000.  (And this is a firm that routinely over-estimates traffic on toll roads).  Road pricing could dramatically reduce the need for expensive infrastructure.  Yet ODOT has not incorporated the traffic-reducing effects of tolling into its design or alternatives analysis.  They are treating it purely as a financial afterthought:  a way to pay for a over-sized roadway after they’ve borrowed billions of dollars to build it.  That’s exactly what Louisville did with a remarkably similar project (widening I-65 from 6 to 12 lanes across the Ohio River); there $1 tolls caused traffic to fall by almost half.

Louisville’s I-65 bridges at rush hour: $1 tolls eliminated tens of thousands of daily trips

If Metro were to demand that road pricing be implemented before squandering billions on this project, it would likely find that the region had more than adequate transportation capacity across the Columbia River. A region that says it is going to implement road pricing doesn’t commit to a multi-billion dollar freeway project based on outdated projections, and subsidize expensive freeway capacity that won’t be needed in a world with pricing. Going deeply into debt for a megaproject and failing to consider how paying for it will reduce traffic is the opposite of planning.

No financial viability.  At $5 billion or more, this will be the most expensive transportation project in this region for the next couple of decades.In theory, the project should be part of the region’s “financially constrained” regional transportation plan, but the budget documents prepared by the state DOT staffs show that they don’t know the actual cost of the project, and that there is a massive, $3.4 billion hole in the project’s budget.  Moving ahead with no clear idea how the project would be paid for is opposite of planning.

The original CRC effort foundered a decade ago because there was no stomach for its excessive costs in either Oregon or Washington.  Congressman Peter DeFazio famously declared the project to be a gold-plated monstrosity.   In the Oregonian on August 14, 2011, Representative DeFazio said:

“I kept on telling the project to keep the costs down, don’t build a gold-plated project,” a clearly frustrated DeFazio said. “How can you have a $4 billion project? They let the engineers loose, told them to solve all the region’s infrastructure problems in one fell swoop… They need to get it all straight and come up with a viable project, a viable financing plan that can withstand a vigorous review.”
(Manning, Jeff. “Columbia River Crossing could be a casualty of the federal budget crunch”, The Oregonian, August 14, 2011).
Later, Representative DeFazio told Oregon Public Broadcasting:
“I said, how can it cost three or four billion bucks to go across the Columbia River?  . . . The Columbia River Crossing problem was thrown out to engineers, it wasn’t overseen: they said solve all the problems in this twelve-mile corridor and they did it in a big engineering way, and not in an appropriate way.”
“Think Out Loud,” Oregon Public Broadcasting, August 18, 2011.

Ten years ago, the two state DOT’s squandered nearly $200 million on planning without first securing the needed funds for the project, and they are repeating this exact failed strategy today.  Now, in their efforts to revive the project, after two years of work, the project has not developed a definitive financial plan, and its estimates of Oregon’s needed contribution have inexplicably jumped by more than $150 million in a month.  ODOT and WSDOT are spending millions—$200 million is planned for staff and consultants before this project breaks ground—with no clear idea of how this will be paid for.

This amendment adds $71 million to the preliminary engineering (PE) phase of the IBR Program. With this change, the total available budget will change to $80 million ($45M from Oregon and $35M from Washington). The estimated PE cost to complete NEPA for the IBR program is approximately $135 million based on a completion of a supplemental environmental impact statement (SEIS) in mid-2024. Following NEPA completion, the IBR program will develop a program delivery plan and progress with right-of-way acquisitions and final design to prepare for the start construction in late 2025. The estimated PE cost for progressing final design to start the first phase of construction is estimated at approximately $70 million. In summary, the total estimate of PE to begin the first phase of construction is estimated to be approximately $205 million. This estimate is contingent on the scope of the IBR solution, as agreed to by program partners, that will be evaluated through the SEIS along with the scope of the program’s first construction phase. Right-of-way costs and construction costs are not included in this budget estimate.

[Chris Ford, Memo to Metro TPAC, “I-5:Columbia River (Interstate) Bridge: Requested Amendment to the 2021-24 Metropolitan Transportation Improvement Program.” Oregon Department of Transportation. September 24, 2021, aka ODOT/Ford Memo. Page 6. Emphasis added.)

The prospect for Build Back Better and a national infrastructure funding package is no reason to move ahead with a misguided, environmentally destructive bridge project.  Oregon and Washington will get their share of these monies whether they build this project, or whether they choose to use these funds more wisely.  A regional government that cared about the future would ask “what is the smartest possible use of $5 billion” rather than approving this project.

Cannibalizing maintenance to pay for megaprojects.  This particular project is a particularly egregious example of how state DOT’s beg for money by complaining that they don’t have enough money to fix potholes, but then use any additional revenue they can find to build massive new projects that simply increase the maintenance burden.  This project is no exception, ODOT is literally asking Metro to approve the reallocation of funds that would otherwise be used for maintenance to pay for planning the megaproject.

ODOT is reducing money for road maintenance and repair to hire consultants for this megaproject.  ODOT’s own memo makes this clear.

This project change requires adjustment to the fiscally constrained RTP. Funds from the fiscally constrained Fix-It buckets in the RTP will be reduced to allow for the $36M ODOT funds to be advanced on this project. Memo with details was sent to Metro 9/17/21 by Chris Ford. We find the analysis is still applicable with the addition of WDOT funds since RTP focuses on Oregon revenue only.

[ODOT/Ford Memo. page 12, Emphasis added.]

Diverting money from maintenance funds to pay for a megaproject is the opposite of planning.

This is a pivotal moment for Metro.  As former Metro President David Bragdon (who guided the agency through the original Columbia River Crossing) wrote in retrospect:

Leadership at ODOT frequently told me things that were not true, bluffed about things they did not know, made all sorts of misleading claims, and routinely broke promises. They continually substituted PR and lobbying gambits in place of sound engineering, planning and financial acumen, treating absolutely everything as merely a challenge of spin rather than matters of dollars or physical reality.

That history is important, because if you’re not honest about the patterns of the past, you are doomed to repeat them. Unfortunately, I understand that’s exactly what’s going on with the rebranded CRC: the same agencies, and even some of the same personalities who failed so spectacularly less than a decade ago – wasting nearly $200 million and building absolutely nothing – have inexplicably been rewarded for their failure by being given license to try the very same task, using the very same techniques of bamboozlement.

Metro has a choice: It can repeat the mistakes of the past and bow to the wishes of an entrenched highway building bureaucracy, or it can do its job, and live up to its professed values.  It can plan.  It can insist on accurate travel projections, it can demand a definitive finance plan, it can require that freeway construction be addressed comprehensively, rather than piecemeal, it can require that the vision for capacity be integrated with congestion pricing, and it can require a full financial plan before squandering more on planning this speculative project.  And above all, it can insist that the region’s next multi-billion dollar transportation project reduce greenhouse gases, rather than increase them.  Anything less would be the opposite of planning.

Oregon, Washington advance I-5 bridge based on outdated traffic projections

The Oregon and Washington Departments of Transportation are advancing their $5 billion freeway widening plan based on outdated 15-year-old traffic projections. No new projections have been prepared since the 2007 estimates used in the project’s Draft Environmental Impact Statement,

The two state DOTs are essentially “flying blind” assuming that out-dated traffic projections provide a reasonable basis for sizing and designing and new bridge, and rejecting other alternatives.

The two agencies have spent two years and tens of millions of dollars but not done the most basic preliminary work to accurately predict future traffic levels.

The Oregon DOT has specifically violated Governor Kate Brown’s pledge that new traffic analyses would be done prior to determining the “best solution” for the I-5 bridge project.

The two agencies have no plans to publish new traffic studies until mid-to-late 2022—months after determining a final design and asking for other local sponsors to approve.

The justification for spending upwards of $5 billion on a massive expansion of the I-5 freeway between Vancouver and Portland—a project misleadingly branded as a mere “bridge replacement”—is the notion that there will be a huge increase in traffic between the two cities.  That notion is based on traffic forecasts prepared by the Oregon and Washington Departments of Transportation.  As with all transportation projects, estimates of how much demand there will be are key to deciding whether projects are needed and justified, for determining how they’ll be designed and what their worth, and critically, assessing their environmental impacts.

Traffic Projections for the I-5 Bridge are based on 15 year old data

When it comes to the “I-5 Bridge Replacement Project,” which has been proceeding for more than two years, there are no new traffic projections.  The latest traffic numbers the Oregon and Washington Departments of Transportation are from the project’s Final Environmental Impact Statement, published in 2011.  They predict that without the project, traffic on the I-5 bridge will increase to 184,000 vehicles per day, and produce high levels of congestion.

Columbia River Crossing Final Environmental Impact Statement , 2011, Chapter 3, page 3-30.

 

These numbers are the same as were presented in the project’s Draft Environmental Impact Statement, published in 2008.  In fact, the traffic analysis for the project was completed in 2007, and is based on traffic data gathered in 2005.

.

Columbia River Crossing Draft Environmental Impact Statement , 2008, Traffic Technical Report, page 47

How, it is reasonable to ask, is it possible to plan for a $5 billion project without bothering to update the most fundamental data used to design, justify, and evaluate the environmental impacts of the project?

Traffic Projections are Central to Project Design and Environmental Impact

The basis for any major transportation investment is some sort of careful statistical analysis to project future travel volumes.  How many people might travel in a region or a corridor, and what are the various options for accommodating their travel?  The statistical models used to generate these data, should, in theory, inform the design of particular alternatives and shape the choices.  In particular, traffic forecasts are essential to evaluating the environmental effects of alternatives:  which alternative will have lower levels of pollution?

We have many concerns about the quality and biases built into the models used by state Departments of Transportation, but without a doubt, these statistical estimates are in theory, the intellectual foundation for any claims about the need for a project.  Without traffic estimates, highway engineers are simply predicating key project decisions on their personal opinions rather than demonstrated facts.  In this case, the engineers guiding the I-5 bridge project are engaged in nothing more than faith-based project planning.

For the past two years, the Oregon and Washington Departments of Transportation have been trying to revive the corpse of the Columbia River Crossing, a multi-billion dollar boondoggle that died in 2014.  In the process, they’ve told a series of lies, beginning with the false claim that unless they move forward with the moribund project, that they’d have to repay $140 million in federal money spent on planning the original project.  (That’s not true!).

In September, the staff of the misnamed “Interstate Bridge Replacement Program” debuted their final and definitive list of project alternatives.  Every one of them is centered on a something labeled as a ten lane bridge, with typical illustrations like this:

If the past is any guide, the agency will draw pictures of a ten-lane bridge, but then size it to accomodate 12 or 14 lanes of traffic—exactly what they did with the failed Columbia River Crossing.  In reality the project is likely to look like these renderings of the Columbia River Crossing—12- or 14- lane, five-mile long freeway.

In the process, the staff has ruled out a range of other alternatives, like improving transit, instituting pricing, improving local connections, and constructing a supplemental bridge, rather than a replacement.  The staff published a series of memos in August, 2021, claiming, based on technical work done by the original CRC process more than a decade ago,  that these alternatives “failed to meet the project’s purpose and need,” the first item of which is “growing travel demand and congestion.” Whether any of these alternatives can meet “growing travel demand” and result in lower congestion depends critically on the assumptions one makes about future levels of traffic.  Similarly, the as yet un-resolved question of how wide the bridge needs to be also hinges on these same traffic forecasts.

For two years, ODOT has disobeyed Governor Brown’s order to prepare new forecasts first

The need for updated forecasts was recognized when the project was revived in 2019.  At the time, Governor Kate Brown promised that a first order of business would be revised forecasts to shape the project.  On November 18, 2019, Brown said:

“I think what else is key is that we’re going to be doing a traffic analysis ahead of time to help us determine what’s the best solution for the I-5 Bridge Replacement Project.”

Clearly, Governor Brown envisioned that we would do a traffic study first—”ahead of time”—and allow the data to shape decision.  But that’s not what has happened.  Let’s turn the microphone over to Clark County Today, which specifically asked the managers of the bridge project the status of their traffic projections, which were originally promised  in 2019.

It is now almost two years later. Has the IBRP team conducted a new traffic analysis to determine what’s the best solution for the I-5 Bridge replacement project? Clark County Today asked for the details of any traffic analysis.

“The Interstate Bridge Replacement (IBR) program is currently collecting new traffic data and conducting preliminary traffic modeling that will be used to inform the evaluation of preliminary design options that will be considered to identify the IBR solution early next year,” said Frank Green, IBR assistant program administrator. “More in-depth traffic modeling is expected to be completed in mid to late 2022 as a critical component of the federal environmental review process.”

The IBRP team has no plans to release forecasts until after making design decisions

That timetable was confirmed at the December meeting of the project’s Executive Steering Committee.  The project’s schedule calls for developing a resolution defining a “locally preferred alternative” by April 2022, and securing endorsements of that solution by June 2022.

 

Meanwhile, ODOT and WSDOT have no plans to complete serious traffic modeling—which would address the impact of tolling on traffic levels—for two or three more years.  In its November presentation on its tolling plans, the agencies made it clear that they are putting off serious “investment grade” forecasts—like the ones made for the CRC, which showed traffic on I-5 would never recover to pre-construction levels, until 2025.

What this means in practice, is that the only traffic projections that the project has were the ones prepared for its original environmental analysis.  These were published originally in 2008, and based on 2005 base year data.  As a practical matter, ODOT and WSDOT are planning this bridge based on data that is now more than 15 years out of date.

Pushing for a decision before updating traffic forecasts is engineering malpractice, and violated NEPA

When the project managers say that they need to build a bridge that is at least 10 lanes wide, it’s based on these outdated projections, rather than current, accurate information.  This isn’t so much fact-based engineering as it is faith-based speculation.  They’ve decided the bridge needs a minimum of ten travel lanes, without first doing a traffic forecast. The I-5 Bridge Project’s Manager has made it clear for nearly a year—well in advance of any technical analyses or any new traffic information—that they’ve already decided what they’re going to do.  Clark County Today summarized a January, 2021 presentation by Greg Johnson:

During discussions at Monday’s EAG meeting, Administrator Johnson made the following statement.
“One of the things that I also tell folks, if you’re here and you think we’re going to talk about a third bridge, or we’re going to talk about not doing the Interstate Bridge, you’re in the wrong meeting.  The whether we’re gonna do this has been decided. “

John Ley, “Revelations surface from the two ‘advisory’ group meetings on the Interstate Bridge,” Clark County Today, January 28, 2021.

Saying that the project must be ten lanes wide, or claiming that other alternatives don’t adequately meet the project’s stated purpose and need are, in the absence of traffic forecasts, simply arbitrary and capricious.  The fact that project managers have repeatedly made definitive statements that no other options will be considered, and that the bridge will be ten lanes wide before even undertaking traffic analysis, shows that they have no intention of allowing the data to drive their decisions, and are signalling that they will cook the modeling to justify this pre-made decision about the project’s size and scope.

Concealing or lying about traffic models is nothing new for ODOT. When it released its environmental assessment for the I-5 Rose Quarter freeway widening project, it entirely omitted any data on “average daily traffic”—the most basic yardstick of travel volumes, and also purposely concealed its modeling assumption that its base year, 2015 traffic volumes were based on the entirely fictional assumption that the I-5 Columbia River Crossing had already been built. As we’ve said, this is the opposite of planning.

 

 

Here’s what’s wrong with Oregon DOT’s Rose Quarter pollution claims

10 reasons not to believe phony DOT claims that widening highways reduces pollution

We know that transportation is the largest source of greenhouse gas emissions in the US, and that our car dependent transportation system is the reason Americans drive so much more and consequently produce far more greenhouse gases per capita than residents of other wealthy countries.  Scientists have shown that building more and wider roads stimulates more driving, longer trips, and more decentralized land use patterns, reinforcing car dependence.

With this entire vicious cycle well-documented, it’s hard to imagine anyone arguing that a widened urban freeway would  be good for the environment, but for state DOTs and their paid apologists, it’s a frequent claim.  They’ve created trumped up projections that claim traffic and pollution will be greater if we don’t build freeways.  These are false claims, and today we take a close look at how this plays out in one egregious, if typical, project.

For years, we’ve been following the Oregon Department of Transportation’s proposed I-5 Rose Quarter freeway widening project.  The project would widen a mile-and-half long stretch of Interstate 5 in downtown Portland at that has recently ballooned to $1.2 billion.

A key part of the agency’s argument is that this freeway widening project—exactly unlike every other one that has ever been undertaken—will have essentially no impact on air pollution or greenhouse gases.  They make the fanciful claim in their Environmental Assessment that the not widening the freeway (the “no-build” option) will somehow produce more pollution than the eight- or ten-lane freeway their plans shown they’re really intending to build.  In this commentary we sketch ODOT’s claims, and present a 10-point rebuttal.

A long list of false environmental claims from Oregon DOT

Recently, a Portlander interested in the project contacted us, asking us to comment on ODOT’s Environmental Assessment, which makes these claims:

  • Traffic operations would improve on I-5 in both the AM and PM time periods, . . .
  •  Conditions for pedestrians and bicyclists would improve from increased travel route options, improved ramp terminal intersections, physical separation from motorized users, and reduced complexity of intersections.
  • Overall, the Regional Travel Demand Model results did not indicate trip increases on I-5 much beyond the Project limits (i.e., no induced demand). The 5 to 14 percent trip increase on I-5 within the Project Area is expected for an auxiliary lane project intended to improve flow between entrance ramps and exit ramps and is indicative of primarily local through-traffic.
  • While consideration of greenhouse gas emissions and the effects of climate change has not been a NEPA requirement for EAs and EISs since the Council on Environmental Quality (CEQ) withdrew its previous guidance on April 5, 2017, ODOT included an analysis of climate change in the Project EA due to the high level of agency and stakeholder interest in these issues. As reported in Section 3.5 of the EA, the 2045 operational greenhouse gas emission total for the Build Alternative is projected to decrease by approximately 22 percent compared to the 2017 emission total due to federal, state, and local efforts to develop more stringent fuel economy standards and vehicle inspection and maintenance programs and the transition to cleaner low carbon fuels for motor vehicles. These trends are expected to continue over the life of the Build Alternative. The Build Alternative would contribute to this reduction due to higher speeds, less stop-and-go traffic, and less idling on I-5. Therefore, no mitigation is proposed.

Ten reasons not to believe Oregon DOT’s false claims

There is so much that is false and misleading about these claims about traffic, air pollution and greenhouse gases that it’s difficult to know where to begin.  We’ve written about all these phony claims at City Observatory.  Here are ten reasons why everyone should ignore ODOT’s environmental analysis of this project.

1. Traffic projections assume that a five-mile long, 12-lane wide freeway was built just north of this project in 2015.  Hidden in the Rose Quarter’s traffic forecasting is an assumption that a massive, multi-billion dollar Columbia River Crossing was built as part of the “no-build”–and finished five years ago. The project is still in limbo in 2021.  This inflates traffic and increases congestion in the Rose Quarter in the “no-build,” and makes the “build” look better than it is.

2. ODOT concealed plans that show it is widening the I-5 roadway enough to accomodate 8 or 10 lanes of traffic.  Two years after ODOT published the environmental assessment we uncovered true plans for a 160-foot roadway. But its traffic modeling assumes that the freeway is expanded only from four to six lanes.   Modeling an 8-  or 10-lane road would show much more traffic and pollution.

Secret ODOT documents showed plans for 160 foot roadway, enough for a 10-lane freeway.

3. ODOT’s Rose Quarter Forecasts forecasts are completely inconsistent with the forecasts they prepared for the CRC and as part of ODOT’s own road pricing work.  Those forecasts show much lower traffic on I-5 in the RQ in the “no build” scenario.  By inflating the base case, and ignoring induced demand, the Rose Quarter forecasts cook the GHG and pollution estimates and hide the negative impacts of the project.  (For details, see the section labeled “Two sets of books”, at the end of this commentary).

4. ODOT frequently claims that “pollution will be lower in the future”—but this is entirely due to assumptions about a cleaner vehicle fleet (more electric vehicles, tougher mileage standards for remaining internal combustion cars).

“. . . operational greenhouse gas emission total for the Build Alternative is projected to decrease by approximately 22 percent compared to the 2017 emission total .  . .”

This is a classic red herring:  You get these emission reductions whether you build this project or not. It’s simply irrelevant to deciding which options to choose. And, for what it’s worth, neither electric vehicle adoption or higher fuel economy standards accomplishing as much as ODOT hoped; in fact greenhouse gas emissions from driving are up in Portland by 1,000 pounds per person

5. In response to these criticisms, ODOT routinely claims that its air quality analysis was validated by a  “peer review panel”.  The panel was a whitewash:  it wasn’t provided with any of the critiques of traffic models and air quality analysis, held no public meetings, and explicitly chose to ignore road pricing, which they admitted could greatly affect project outcomes.  Former ODOT Director Grace Crunican, who ran the review, testified that the group didn’t look at the traffic projections to see if they were reasonable or accurate, they just took them at face value. The phony traffic numbers generate phony air quality estimates.

6. There is a strong scientific consensus on induced demand, with multiple studies in the US, Europe and Japan.  Wider roads means more travel.  ODOT and other highway agencies simply ignore the science.

When pressed, professional staff ODOT and PBOT admitthis project will do nothing to reduce daily “recurring” congestion at the Rose Quarter—invalidating claims that it will produce less idling.

7. At City Observatory, we’ve developed a version of the induced travel calculator created by the University of California Davis to estimate greenhouse gas emissions from the Rose Quarter project.  Its verdict:  Widening the roadway will increase emissions by adding 17.4 to 34.8 million miles of vehicle travel and 7.8 to 15.5 thousand tons of greenhouse gases per year.

8. Highway engineers love to pretend that greenhouse gases are caused primarily by cars having to idle in traffic, and they we can fight global warming by getting cars moving faster. That’s a myth:  Improving traffic flow generates more total miles of travel which overwhelms any savings from less idling.  Also:  Cars generate more GHG per mile at speeds over 50 MPH than below (something ODOT never mentions).  Wider, faster freeways mean both more vehicle miles traveled and more greenhouse gases generated per mile traveled.  This is validated scientifically by a paper published by two scholars at Portland State University.

9. Like most state DOT’s Oregon DOT uses an outdated and flawed traffic modeling approach that fails to accurately incorporate the effects of induced demand.  These static, four-step models consistently over-estimate traffic levels and congestion for no-build scenarios, and under-estimate or completely ignored the added travel induced by creating more capacity.

10. Globally, the only strategy that’s convincingly been shown to lower congestion is road pricing, which the Oregon Legislature approved for this stretch of I-5 in 2017.  Oregon DOT failed to examine road pricing as an alternative in its 2019 Environmental Assessment.  ODOT’s own consultants say pricing I-5 would obviate any need to add lanes at the Rose Quarter.

Governor Brown ordered ODOT to look at road pricing as part of its environmental review of the project in late 2019; but the agency has simply ignored her instruction.

ODOT is keeping two separate sets of books for its I-5 traffic estimates.

There’s no question that the traffic estimates created to sell the Rose Quarter project were rigged to make the “No Build” look worse.  At the same time it generated the Rose Quarter forecasts, ODOT hired another firm to estimate future traffic on this same stretch of roadway in 2027.  It came up with dramatically lower levels of I-5 traffic in the “no-build” world.

In May 2018, at the same time it was preparing I-5 forecasts for the Rose Quarter project, ODOT also contracted for modeling of I-5 traffic for the legislatively adopted congestion pricing plan. These are contained in a report from ODOT: https://www.oregon.gov/ODOT/Value%20Pricing%20PAC/VP_TM3-Final-InitialConceptEvaluatio n.pdf

These data include baseline estimates of traffic on Interstate 5 in the Portland metropolitan area for the year 2027. The study has baseline estimates, that project future traffic conditions in the absence of congestion pricing. This study uses an I-5 cordon line North of the project area corresponds to N. Skidmore Street, which is just two blocks from the I-5 cordon line used for the Rose Quarter projections. The following table compares the projected 2027 volumes in the congestion pricing study at this cordon line with the VISUM Rose Quarter 2015 volumes. This shows that the volumes used in the VISUM model for 2015 are 21 to 37 percent higher than the expected volumes in 2027, according to the congestion pricing baseline model.

I-5 North Volumes from two ODOT models
Northbound Southbound Total Difference
Time Period RQ VISUM Model (2015)
AM Peak 8AM-9AM 4,370 4,631 9,001 37%
PM Peak 5PM-6PM 4,424 4,855 9,279 21%
Conges on Pricing Study (2027)
AM Peak 8AM-9AM 3,255 3,337 6,592
PM Peak 5PM-6PM 3,803 3,860 7,663
RQ VISUM Model, “Mainline North of Going, 2015 No Build”
Conges on Pricing Study, “Interstate Br.-Skidmore” Baseline Traffic Performance

This analysis suggests that the traffic numbers, particularly north of the Rose Quarter project area are much higher than would be expected in another arguably reasonable forecast of traffic conditions. Given the expectation of growing traffic levels in the ODOT Rose Quarter modelling, one would expect that 2027 I-5 traffic levels would be considerably higher, not lower than 2015 levels. The fact that two models, prepared for the same agency, in the same month, produce two such different pictures of traffic levels suggests that the model results are highly sensitive to the assumptions and input values used by the modelers. These key values and assumptions have generally not been provided to the public for review, making it impossible for independent, third parties to understand, replicate, and analyze the summary results presented in the Environmental Assessment.

Freeway-widening grifters: Woke-washing, fraud and incompetence

The Oregon Department of Transportation’s glossy mailer to sell its $1.25 billion I-5 Rose Quarter Freeway widening project is a cynical, error-ridden marketing ploy.

ODOT doesn’t show or tell about its wider freeway and more traffic, but instead tries to sell the project based on buildings it won’t contribute any money for building.

ODOT sent an expensive mailer to thousands of Portland households studded with nearly two-dozen typographical errors.

The key part of salesmanship, whether you’re selling condominium time-shares or breakfast cereal, is to emphasize the really attractive things that aren’t part of what the customer is paying for, whether it’s models cavorting on a glistening white-sand beach or the fresh bananas and blueberries atop a pile of bland corn-flakes.  The grifters at the Oregon Department of Transportation have settled on just this strategy for peddling their now $1.25 billion Rose Quarter freeway widening project.  In their latest marketing material:  It’s not about cars or lanes at all, it’s about covers and community centers and housing built by Black artisans.  Never mind that these “features”—like the models and the blueberries—aren’t actually part of the ODOT project at all.

Woke-washing:  Fictional buildings

As we’ve documented at City Observatory, the Oregon Department of Transportation is implicated in the destruction of Portland’s historically Black Albina neighborhood.  It slashed through the area with three major highway projects in the 1950s, 1960s and 1970s, leading to a two-thirds decline in neighborhood population.  Today, its trying to sell its massive 10-lane wide freeway widening project—which would increase traffic and pollution—as a way to remediate the damage to the neighborhood.

Earlier this month, ODOT sent a glossy 4-page newsletter to thousands of Portland households.  Its key feature is illustrations portraying new, but entirely fictitious, buildings lining the streets of Albina.  Previously, they’ve shown proposed buildings to be constructed on or adjacent to the freeway as part of the project’s environmental assessment.  Earlier this year, they paid consultants to illustrate hundreds of entirely conjectural apartments on or next to the widened freeway.  Now their new brochure sets a new bar for illusion, showing a fictitious streetscape of N. Vancouver Avenue, with three imaginary buildings.  In the lower right hand side of the frame, a young Black man stands in front of a building labeled a “Career Development Center,” carrying a plaque stating:  “This building constructed by Black artisans in 2022.”  It’s a nice thought, but such a building is not part of what ODOT will build or pay for.  Nor, in fact, are any of these buildings.

This freeway widening project is part of a complete breakfast (some features sold separately).

If this were a commercial publication, it would have to include some kind of disclaimer.  ODOT went out of its way to emphasize the “highway cover” aspects of the project, without mentioning that the project’s real purpose is to widen the freeway. The brochure is doesn’t show a single car, nor does it reveal that the project is designed to expand the freeway to as much as ten lanes wide.

Fraud:  There’s no money to build these buildings

It would, of course, be nice to have more housing in Albina, and to have a career development center, and to advance the redevelopment plans of the Albina Vision Trust.  But in reality, none of these features is actually part of ODOT’s I-5 Rose Quarter Freeway widening project.

The fundamental problem with all these imaginary buildings, including new housing, and the career development center:  There’s no funding for any of them as part of the Rose Quarter freeway widening project.  And, as we’ve shown at City Observatory, the cost of new buildings shown would run to hundreds of millions of dollars.  Despite the fact that it demolished hundreds of homes to build its highways through Albina, ODOT has never provided a dime to rebuild any of them, and is saying it won’t as part of this project either.

At best, the project claims that it might provide the sites on which these mythical structures could be built, but even that claim is misleading.  The Oregon Transportation Commission is now seeking to stick city and county governments with the added costs of freeway covers wide and strong enough to support this development.  So while apartments and a career development center are being prominently displayed as the centerpiece of this project, ODOT isn’t paying for any of them, or even the sites on which they’ll be built.  They expect others to do so.  The fact that the agency pretends to care about social justice, but won’t contribute to repairing the damage its three highways caused Albina, including replacing the housing it destroyed, shows its commitment is a sham.

Incompetence:  A document shot-through with typographical errors

The full-color glossy four-page brochure, titled “Newsletter: I-5 Rose Quarter Improvement Project, Volume 1, Issue 2, September 2021” was delivered via bulk mail to thousands of households in North and Northeast Portland.  But while ODOT took great pains to downplay the actual nature of the project (a ten-lane freeway), and to incorporate images of African-Americans and fictitious buildings, they apparently didn’t have a budget for proof-reading or care enough to do a press check of their elaborate newsletter.

As publishers ourselves, we know that the occasional typo is the bane of one’s existence, and that a few always seem to sneak through.  No one is perfect.  But in this ODOT newsletter we counted 23 typographical errors. Here we’ve circled in red errors on pages 2-3 of the brochure.

There were errors on every page of the brochure.  One page of the report is titled:  “Our Values in Action.”  Apparently neither accuracy nor attention to detail are among the project’s values.  For years, the agency has been misleading the public about the project, concealing basic facts like the width of the freeway it is planning to build and repeatedly including illustrations of fictional buildings that aren’t part of the project (see below).

There’s a lot of missing substance in this ODOT newsletter.  It reveals nothing about the cost of the project, which has ballooned to $1.25 billion.  It conceals the fact that the real purpose of the project is to widen the I-5 freeway to 10 lanes, which will result in more traffic and pollution. It ignores news reports that have utterly disproven its false safety claims about the project.  It says nothing about the active community opposition to the project, which has produced thousands of citizen objections.  It doesn’t reveal that the project is being challenged in court for violating federal environmental laws and state planning requirements.  It fails to acknowledge that the project will increase greenhouse gases–a fact that has produced regular bi-weekly protests at ODOT’s Portland headquarters.

What this document really shows is that ODOT has no intention of telling the truth about the Rose Quarter freeway widening project.  This brochure, like the ODOT effort that produced it, is cynical, misleading and incompetent.  This is hardly an effort that should be rewarded with $1.25 billion in public funds.

ODOT’s deceptive history

Here are illustrations from the project’s 2019 Environmental Assessment showing wireframe buildings as part of the freeway-widening concept.  (Again:  There’s no funding for such buildings as part of the project).

Likewise, ODOT’s highway cover consultants created the illusion that apartment buildings (the yellow legos on this diagram) might be part of the project’s covers.  Building such apartments would cost between $160 million and $250 million, and ODOT is providing no funding for any such construction.

 

 

Talkin’ ’bout my gentrification

Jerusalem Demsas of Vox has a thoughtful synthesis of what we know about gentrification.  

If we’re concerned about poverty and inequality, gentrification is far from the biggest problem we face.

Gentrification is surprisingly rare, and while it brings inequality into sharp focus, there’s precious little evidence of widespread harms.  The bright spotlight shining on a relative handful of gentrified neighborhoods hides in the shadows the real and far more pervasive problem of concentrated poverty.

And, as we’ve written at City Observatory, the myopia of gentrification scholarship means that few studies every consider the counterfactual case of asking what happens to people who live in poor neighborhoods that don’t rebound.  

The most common anti-gentrification tactics—blocking new market rate housing—actually make housing affordability and displacement worse.

Writing at Vox, Jerusalem Demsas has become quickly established as a keen observer of urban issues.  This past week, Demsas waded into the gnarliest and most contentious urban debate, gentrification.  This balanced essay is worth a read.  Here’s our take.

Gentrification doesn’t create inequality:  It just makes it more visible.

America’s cities are segregated by race and class and essence of segregation is keeping these worlds separate and apart from one another, and by doing so, make inequality less visible.  What gentrification does, in effect, as Demsas convincingly argues, is to force us to see inequality:

Segregating neighborhoods does not get rid of these sentiments or the harms they cause: it simply hides them. In a wealthy, white enclave like the Upper East Side, there aren’t somehow fewer people who assume any Black person on their street is begging for money than there are in gentrifying neighborhoods. In fact, there are likely more. Gentrifying neighborhoods pull back the veil and allow for these worlds to collide, displaying the vast differences in income, access to education, and government protection and investment.  . . . Taken all together, it becomes clear why we focus on gentrification while the unseen culprits (segregated enclaves) are able to avoid controversy: Gentrification is the most visual manifestation of inequality in urban life.

Concentrated poverty, not gentrification is the big urban challenge

Much of the gentrification literature is fueled by anecdotes and narrowly drawn case studies that relate the dissatisfaction that long-time residents of gentrifying neighborhoods feel as a result of neighborhood change.  And there’s little question that change imposes social and psychic costs for long-time residents.  This kind of ethnographic research isn’t so much wrong as it is incomplete.  As we’ve pointed out at City Observatory, this kind of research is biased because is is missing the counterfactuals:  What do long-time residents of non-gentrifying poor neighborhood say about how their neighborhoods have changed?  And what would a neighborhood look like if it didn’t attract new residents.

We and others have assembled comprehensive data on neighborhood change in US cities.  It shows that gentrification is extraordinarily rare (over 4 decades, perhaps 10 percent of poor neighborhoods experienced gentrification, defined as having a poverty rate fall from twice the US average to anything less than the national average).  Statistically, the far more striking fact is the persistence and growth of concentrated poverty.  Poor neighborhoods that don’t gentrify steadily lose population (down an average of 40 percent over 40 years), and the number of high poverty neighborhoods in major US metro’s has tripled.  Americans in poverty today are more likely to live in neighborhoods of concentrated poverty.  Research shows that all of the negative effects of poverty are amplified by having lots of poor neighbors.  As Demsas concludes:

City by city, the message is clear: Segregation and concentrated poverty are the true blights of urban life, despite our fascination with gentrification.

There’s precious little evidence of the supposed harms of gentrification even in those relatively few neighborhoods that are changing. Careful economic studies show that gentrification generally benefits long-time residents.

Supposed cures for gentrification often make the problems worse

Demsas concludes by musing about the “ethical” ways we might use to promote greater integration, and ends up suggesting more housing, greater tenant protections, and less restrictive zoning in predominantly white and middle income neighborhoods.  Making it easier to build more housing in high demand locations makes a lot of sense, but that advice runs distinctly counter to most anti-gentrification efforts, which are squarely focused on blocking new market rate housing.

The painful irony of many anti-gentrification tactics is they simply serve to make housing affordability and displacement worse. Advocates regularly oppose up-zoning and new developments, or as in Atlanta, impose development moratoria to “save” the neighborhood.  Attempting to slow or stop  neighborhood change by blocking the construction of new market-rate housing—which many associate with gentrification—only makes housing supplies tighter, and drives up rents.  As Demsas notes, this flies in the face of a spate of recent studies that show that construction of new market rate housing actually helps hold down rents, and by setting off a chain of household moves, opens up more housing opportunities for lower and moderate income households.

Two of the big persistent problems in the American metropolis are segregation and racial wealth disparities.  And despite the pain of change, gentrifying neighborhoods are the places where these two interrelated problems are being ameliorated.  Our 2018 study America’s Most Diverse, Mixed Income Neighborhoods, showed that many places identified as “gentrifying” are the most racially and economically mixed places in the nation.  And contrary to common assumption, once neighborhoods become more racially and ethnically diverse, they tend to stay that way.

As Andre Perry and his colleagues at Brookings Institution have documented, there are persistent disparities in the value of homes in predominantly Black and predominantly white neighborhoods.  These disparities are a major contributor to the racial wealth gap. And these disparities are largest in metro areas with high levels of racial segregation.  It’s a seeming paradox, but rising home prices in gentrifying neighborhoods are actually diminishing this underlying home value disparity.  As bad as a it may be to have to pay higher property taxes because your home has appreciated (and your wealth has increased) it’s far worse to see your wealth stagnate or decline because slumping home values in a segregated neighborhood.

Climate efforts must be cost effective

Portland’s $60 million a year clean energy fund needs climate accountability

Any grant writer can spin a yarn that creates the illusion that a given project will have some sort of climate benefits, but if you’re actually investing real money, you should insist on a payback in the coin of the climate realm:  a measurable and significant reduction in greenhouse gas emissions.  That standard isn’t being met, mostly because even the most basic questions aren’t being asked of projects submitted for funding by Portland’s Clean Energy Fund.

Former Portland City Commissioner Steve Novick, and long-time Chair of the Oregon Global Warming Council, Angus Duncan are demanding that Portland’s $60 million per year clean energy fund have at least minimal performance standards when it comes to reducing greenhouse gases.  A bit of background:  using the city’s initiative process, activists forwarded a ballot measure to create a gross receipts tax on larger businesses, with the proceeds dedicated to clean energy investments.  The voters approved the measure by a wide margin, and the Portland Clean Energy Fund (PCEF) now is making grants to community groups for projects to promote greater energy efficiency, and, at least in theory, reduce greenhouse gases.  But in practice there are real concerns that the dispensation of grants is advancing either climate or equity considerations. As Novick and Duncan wrote in their Op-Ed:

Already, the fund has issued grants for projects that have nothing to do with climate or equity, including $100,000 for a rooftop garden on a yoga studio. For the program’s long-term success, we should ensure that the fund supports proposals tied to specific outcomes and cost-effectiveness goals. Unfortunately, the fund’s proposed scoring criteria do not provide any such benchmarks. Indeed, they are not really focused on outcomes at all.

The underlying problem is that PCEF doesn’t have clear standards for defining what constitutes either equity, or cost-effective greenhouse gas reductions.  According to Novick and Duncan, the application process is a kind of affinity-demonstrating beauty contest, with applicants chosen chiefly for the meritorious origins of the sponsoring organization rather than the characteristics of the project.

For example, applicants for large-scale grants of up to $10 million can earn no more than 8 points out of 100 for reducing greenhouse gas emissions. Think about that: “Clean Energy Fund” applicants could, apparently, get 92 points out of 100 without reducing greenhouse gas emissions at all. Meanwhile, applicants can only lose 5 points if their proposal will not “realistically result in intended outcomes.” So, you could get 95 out of 100 points even if your project has no realistic chance of succeeding. Applicants get a large number of points for “characteristics of the organization” categories, which may be important, but not more than actual results. The selection committee could simply require that organizational applicants meet certain criteria for diversity, etc., rather than allowing applicants to make up for a lack of substance by accumulating “organizational” points.

The idea of setting up a public sector fund to advance the twin goals of promoting equity and reducing greenhouse gases has considerable merit, but if it’s going to make any difference in either area, it needs to insist on measurable results and clear accountability.  The current PCEF regulations do very little to achieve this fundamental need.  Portland’s voters, historically disadvantaged communities, and the environment all deserve better.

A net zero blind spot

Stanford claims its campus will be 100 percent solar powered . . . provided you ignore cars.

A flashy news release caught our eye this week.  Stanford University is reporting that its campus will be 100 percent powered by solar energy very soon.

In the echo chamber that is social media, that claim got a lot of attention and repetition, and predictably morphed into an even more sweeping accomplishment.  Climate Solutions tweeted that Stanford would be the first major university to achieve 100 percent clean energy.

To be clear, Stanford’s press release didn’t make that claim, but any time you tout “hashtag 100 percent” anything, people tend to focus on the “100” and not on the universe to which that is applied.  When you read the fine print, it’s clear that the “100 percent” claim applies only the the campus buildings, not to how students, faculty, staff and visitor actually get to and from the campus to for education, research and entertainment.

Buildings get a lot of attention; you have to use energy to heat, light, and cool them, and run computers and other equipment, but as with the rest of America, the far bigger source of energy use and carbon emissions is not the buildings themselves, but the energy and pollution generated by traveling to and from them.  In California, cars account for 5 times as much greenhouse gas production (28 percent) as all commercial buildings (5.5 percent).

In the case of Stanford University, The “100 percent  solar” claims definitely doesn’t include the campus’s nearly 20,000 parking spaces, most of which are used by internal combustion fueled cars.   About 58 percent of those working on campus arrive by private car. And that produces vastly more carbon emissions that just building operations.

To its credit, in recent years, the university has been taking steps to build more on-campus housing, and to meet the travel demand from expansion without increasing the total number of car trips, but it’s still the case that cars and travel are the university’s leading source of greenhouse gas emissions.  So far the university’s own sustainability plan has counted mostly building-related emissions, and avoided counting what it classifies as “Scope 3” emissions associated with university travel.  They’re planning to address those emissions in the future.

While it’s technically true that the building energy may come from solar, it’s important to recognize that the buildings have no utility unless people travel to and from them on a regular basis.  The parking lots, and the cars they service are an integral–and in fact dominant–part of the university’s carbon footprint.  It’s all well and good to celebrate greater use of solar power, but before anyone makes “100 percent” or zero net carbon about any particular institution, they would do well to consider all their emissions, not just one component.

 

BIB: The bad infrastructure bill

Four lamentations about a bad infrastructure bill

From the standpoint of the climate crisis, the infrastructure bill that passed the Senate is, at a minimum, a tremendous blown opportunity.  Transportation, especially private cars, are the leading source of greenhouse gas emissions in the US.  We have an auto-dependent, climate-destroying transportation system because we’ve massively subsidized driving and sprawl, and penalized or prohibited dense walkable urban development.  The Senate bill just repeats the epic blunder of throwing more money at road building, and even worse this time, drivers are excused from paying the costs of the bill—a triumph for asphalt socialism.

You’ve probably seen “BIB,” Michelin’s famous cartoon mascot for its tires (and tourist guides).  Coincidentally—and perhaps appropriately—BIB is the nickname of the Senate-passed bi-partisan infrastructure bill. and the animated stack of tires is an fitting mascot for the legislation.  It’s all about driving and jovially oblivious to the deep systemic problems in our approach to transportation finance.

Michelin’s BIB is the true mascot of the Bi-Partisan Infrastructure Bill; Two thumbs up for more subsidies to auto dependence, climate destruction and asphalt socialism.

Others, including Transportation for America, NACTO, Streetsblog, the Eno Foundation and Politico have written about the details behind the bill.  You should definitely read their analyses.  But allow us to pull out just four themes—lamentations, if you will—that explain why this triumph of bipartisanship is a disaster for safety, climate, and fiscal responsibility.

1. $200 billion for more deadly, climate killing highways.  The centerpiece of the bill is more money for roads and bridges, which in practice means wider roadways and more capacity.  The Senate Bill writes a $200 billion check for state highway builders, which is likely to fund wider roads and bridges that will generate more traffic, more pollution, more climate-destroying greenhouse gases, and more sprawl.  The National Association of City Transportation officials observes:

. . . the infrastructure bill passed today by the Senate keeps our nation on an unsafe and unsustainable path. It continues to prioritize building the infrastructure that most contributes to the U.S.’s worst-in-class safety record and extraordinarily high climate emissions: new highways. With transportation as the largest source of U.S. climate emissions, and 80% of those coming from driving, the Senate’s bill goes in the wrong direction, giving a whopping $200 billion in virtually unrestricted funding to this unsustainable mode.

Ironically the Senate passed the bill the same week the International Panel on Climate Change released its latest and most dire warning about the damage done by these greenhouse gas emissions.  The Senate Bill not only does nothing, but promises to squander vastly more resources to make the problem worse.

2. No accountability for climate, safety or good repair.  It’s a considerable exaggeration to say we have a federal “transportation policy.”  In effect, while it mouths a national interest in a safe, well-maintained and sustainable transportation system, the Senate bill just continues a system in which the federal government writes huge checks to state highway builders and . . . looks the other way.  There are no requirements with any teeth that hold states accountable for the most basic of outcomes, and the Senate bill continues this system, as Beth Osborne of Transportation for America explains.

. . . the Senate also supercharged the highway program with a historic amount while failing to provide any new accountability for making progress on repair, safety, equity, climate, or jobs access outcomes.

3. Inequitable asphalt socialism, and the cynical joke of “user pays”.  The great myth of road finance in the US is that we have a “user pays” system.  Truth is that’s never been the case, as road users have forever been subsidized, and shifted the social, environmental and health costs of the road system off onto others.  The Senate had no stomach for asking road users to pay a higher gas tax to support roads, so instead, they’ve turned the  highway “trust fund” into the trust-fund baby of the BIB, getting a huge infusion of general fund money, which will simply be added onto the national debt, with the costs ultimately being repaid, with interest, from income taxes.

An analysis by the ENO Foundation shows that the Senate bill transfers $118 billion to the highway trust fund from the general fund, bringing the total amount of the bailout of highway funds to more than $272 billion since 2008.

We know that despite Congress dumping more than $200 billion of general fund revenue into the highway portion of the fund, that car apologists will continue to make the false argument that we have a “user pays” system, and that spending money on any non-auto form of transportation is somehow stealing from drivers.  This bill completely disconnects use of the transportation system from the obligation to pay for its costs:  what we call asphalt socialism.

4. We could have done better.  House Transportation and Infrastructure Chair Peter DeFazio managed to engineer passage of a decent stab at transportation reform in the House, only to see it “gutted and stuffed” by the Senate.

The bill that passed the House earlier this year contained provisions that at least gently nudged expenditure priorities in favor of “fix-it first” policies that would put repairs ahead of expansion, would require at least an effort to consider how highway construction leads to greenhouse gas emissions, and would have held states accountable for actually improving safety (rather than just talking about it).  All that language was purged from the Senate BIB.

Politico‘s Tanya Snyder offers a succinct insider explanation of the politics of the bill from an anonymous former congressional staffer:

“It’s not that it was bipartisan; it was a least common denominator approach,” said the former aide, who worked on the transportation bills that Congress enacted in 2012 and 2015, both of which were hailed as triumphs of bipartisanship. Larger ambitions, he said, “fail to get addressed because of the insistence on staying in the very, very narrow area of bipartisan agreement and we recreate the status quo.”

So what the BIB really does is recycle and perpetuate a badly broken transportation finance system that promises to make our climate, community, health and transportation problems worse, not better.

 

America’s berry best cities

Why Boston and Portland are the berry-best metros, and why it matters

Summer is the height of berry season in most of the US, and nothing beats a fresh, locally grown blackberry, blueberry or raspberry.  Today we’re ranking large metro areas in the US based on how many berries they grow (which we’re proxying using USDA data for farm acreage devoted to commercially raising berries of one sort or another).  While you can find at least some local berries almost everywhere, a few places really have an abundance of summer fruit.

The overall leader is the Boston metro area, which is located at the Southern end of the nation’s cranberry-bog belt, and which has more than 12,000 acres devoted to raising berries in the counties that make up the metro area.  Second is Portland, at the head of the Willamette Valley, with 11,500 acres of berry farms, which produces a wide array of berries.  Other top metros include Tampa (a big producer of early season fruit) and Grand Rapids (a big blueberry producer).  Almost every metro area has at least a few commercial farms, but they’re rare in many dry places, like Austin, Denver, Las Vegas and Phoenix.  Of the 53 US metro areas with more than a million population, here are the top 25 metro areas, ranked by acres of berries grown:

Berry acreage by metro area (USDA Food Atlas)

Also near the top of the list, Philadelphia has a wealth of local berry farms.  In the west, they call it “U-pick”; in Philly it’s called “PYO–pick your own” and the Inquirer has lists of farms within thirty miles of center city where you can harvest your own blueberries or strawberries.

The economic importance of local, perishable things

While it might seem like ranking cities based on the presence of summer fruit is a bit esoteric, bear with us.  There’s a really good reason for thinking this is important.  A while back, for example, Paul Krugman waxed poetic about fruit and economic theory.  Krugman was just back from Europe, and thirsting for summer fruits coming into season. That led him to reflect on a fundamental flaw in economic logic, the notion that more choice is always better. The short, uncertain season for his mangoes and figs, makes them all the more valuable, not less so. He observes:

 . . . seasonal fruits — things that aren’t available all year round, at least in version you’d want to eat – have arrived. Mangoes! Fresh figs!  What makes them so great now is precisely the fact that you can’t get them most of the year. . . .The textbooks (mine included) tell you that more choice is always better. But a lot of things gain value precisely because they aren’t an option most of the time. I’d probably get tired of fresh figs and mangoes if I could get them all year round. But still, if you imagine that being rich enough to have anything you want, any time you want it, would make you happy, you’re almost surely wrong.

We’ve written about other things—ranking cities by the numbers of locally owned restaurants, for example.  As the urbanist Jane Jacobs observed its these distinctive local experiences that make places special.  Every city has its own unique strengths—the big challenge is to understand, appreciate and build on them.  That’s what makes a great city.

Selling Oregon into highway bondage

Borrowing billions to widen roads endangers the climate and finances

It’s doubly wrong to burden future generations with the environmental costs of wider roads, and then also send them the bill

Bond financing of new capacity puts expansion ahead of repair and endangers the financial soundness of the transportation system

Oregon Governor Kate Brown has just signed legislation that passed the Oregon Legislature,  HB 3055, which authorizes the Oregon Department of Transportation to issue revenue bonds to finance potentially billions of dollars of highway widening projects in the Portland metropolitan area.

The Oregon DOT plan: Borrow billions to build more roads to make environmental catastrophe even worse.

Oregon DOT is planning to widen freeways in Portland, including the Rose Quarter I-5 project, which we’ve now proven is designed to be wide enough to accomodate ten lanes.  It’s excessive width is the reason this project costs $800 million, and will cost even more if promised covers are constructed.  The department is working on a multi-billion dollar list of other freeway expansion projections, including a revived Columbia River Crossing, a widening I-205, a new Boone Bridge and widening Highway 217.  As we know from the fundamental law of road congestion, each additional lane mile of urban highways has the effect of generating more travel, more traffic and more pollution; these projects will certainly and measurably increase greenhouse gas emissions.

HB 3055 allows ODOT to adopt a “borrow, spend and build, then only later toll” approach to construction which is guaranteed to produce oversized facilities, that require increased traffic to avoid being a financial burden.  ODOT’s own consultants on tolling have said that modest tolls could avoid the need to build any additional capacity on key Portland freeways, including the Rose Quarter.

ODOT  is planning to embark upon a speculative financing scheme authorized by HB 3055 to issue potentially billions of dollars of bonds to widen highways throughout the Portland area.  In theory, the bonds would be repaid by tolls, but ODOT has exactly zero experience in forecasting toll revenues. Forecasting toll revenue is a notoriously difficult business, and many toll roads and bridges have been forced into bankruptcy or bailouts because toll revenues didn’t match over-optimistic projections.

That’s a problem, because HB 3055 allows ODOT to pledge, without limitation, all of its future revenues from state taxes and federal grants, to the repayment of bonds issued to pay the cost of toll funded highway expansion projects. If toll revenues are insufficient, ODOT would be required to take money from every other available source, including state and federal funds for road maintenance around the state, and use it to satisfy bond obligations.

Coupled with the fact that its major projects of the past two decades have all ended up costing double or more what they were projected, bond financing freeway widening exposes the state to financial risk.  And when toll revenues aren’t enough to cover construction costs, ODOT is pledging every dollar available to it to bondholders, putting them in line ahead of every other project in the state, including maintaining our existing roads.

What’s worse:  this Faustian bond bargain commits Oregon to filling newly widened roads with traffic in order to generate the money to pay bond holders.  Borrowing creates the perverse financial incentive to maintain and increase traffic (and attendant climate pollution) in order to be able to pay off bonds and is directly contrary to the state’s adopted legal goal of reducing greenhouse gas emissions. This approach is doubly evil:  it widens roads and generates traffic that will make climate change worse, and sticks future generations with the bill for paying for these roads, whether they’re used or not.

This plan to bond for huge highway expansions in the Portland area takes the state in exactly the wrong direction, in contradiction to our stated values:   it would worsen our state’s carbon footprint, make us financially beholden to financial markets to generate traffic to repay bonds, and send the bill for this destructive and unneeded capacity to future generations of Oregonians, while undercutting the financial stability of the state transportation system.

Oregon DOT’s Real Climate Plan: Keep on polluting

The Oregon DOT’s “Climate Action Plan” claims that the agency wants to decrease greenhouse gases, but its financial plans show otherwise

The agency’s revenue projections show it is planning for gasoline consumption not to decline at all, meaning that carbon emissions don’t decline

ODOT’s fuel tax projections imply that cars and trucks will continue to produce about 19 million tons of greenhouse gases through then end of this decade, an amount 60 percent larger than consistent with achieving the Governor’s greenhouse gas reduction goals.

ODOT has used these fuel consumption projections to convince private investors to buy bonds to be repaid from future gas tax revenues; the financial projections, not the climate PR, represents the agency’s real position.

 

The Oregon Department of Transportation is telling anyone who’ll listen about their supposed deep concern about climate change, and all the actions they’re taking to reduce greenhouse gas emissions.  It’s a splashy PR campaign, with a newly minted “climate office” and a “fig leaf” logo.

But that’s not the real story.  The real story is told, not in the agency’s PR documents, but in its financial plans and projections.  It’s told in the byzantine “official statement” it provides to bond markets.  That real story is that the agency is planning on Oregon’s transportation system continuing to emit just as much greenhouse gases for the next decade as it does today.  Its financial plans hinge on Oregonians buying, and burning enough gasoline and diesel into the 2030s to produce nearly 20 million tons of CO2 a year—roughly 20 percent more than was emitted in 1990, and nowhere near the state’s official target of cutting greenhouse gas emissions by 80 percent by 2050 (and far below interim targets established by Governor Brown).

Oregon Governor Kate Brown’s  climate emergency order calls for reducing greenhouse gas emissions by 45 percent from 1990 levels by 2035; ODOT is counting on fuel consumption that will produce greenhouse gas levels of 19.4 million tons in 2030; nearly 20 percent higher than in 1990, and 70 percent higher than the amount needed to be on track to meet the Governor’s stated goal.

This department’s revenue forecast belies claims that any of the actions it’s hoping for, including electric vehicle adoption or more efficient internal combustion vehicles will do anything in the next decade to reduce Oregon’s transportation greenhouse gas emissions.

ODOT predicts we’ll continue buying and burning 1.7 billion gallons of taxable motor fuel every year, through 2030.  This coupled with other transportation fuels, in turn, will produce 19.4 million tons of greenhouse gases annually through 2029.

Here’s ODOT’s latest (April, 2021) forecast of quarterly taxable motor vehicle fuel sales.  (This doesn’t include sales of diesel fuel for large, over the road trucks which pay the state’s weight-mile tax).  As you can see, these quarterly figures show long term consumption of motor fuels stabilizing at a bit more than 440 million gallons per quarter (about 1,760 million gallons annually) through the remainder of the decade.

Source:  Oregon Department of Transportation Revenue Forecast, April, 2021.

Burning gasoline and diesel fuel translates directly into more greenhouse gas emissions. It’s very straightforward to estimate the greenhouse gas emissions that result from burning a gallon of gasoline.  Each gallon of gas, when burnt, produces 8.87 kilograms (almost 20 pounds) of CO2.  That means burning 1.75 billion gallons of gasoline will result in about 15.6 million metric tons of carbon dioxide (1,750,000,000 * 8.87).  Burning diesel fuels accounts for most of the rest of the 19.3 million in emissions (see further discussion of diesel fuel consumption, below).

The continued burning of all this fossil fuel is completely inconsistent with Oregon’s stated climate goals. As illustrated by the green line in our first chart, Governor Brown’s Executive Order 20-04 implies a much more rapid and dramatic decline in greenhouse gases, and therefore, fossil fuel consumption. This same point has been made by the Oregon Global Warming Commission, which has sketched out the path to meeting the state’s 2050 goal of reducing greenhouse gases to no more than 20 percent of 1990 levels.  (See the yellow dashed lines).

It’s worth noting, as we’ve pointed out before at City Observatory, that the most effective means of reducing gasoline consumption (and greenhouse gases) was higher fuel prices.  Fuel prices which rose steadily from 2004 through 2008, and which remained high until 2014, had the effect of reducing Oregon’s total gas consumption by almost 10 percent.  When gasoline prices plunged by almost 40 percent in 2014, following the collapse of global oil prices, Oregon’s gasoline consumption surged from about 400 million to about 470 million gallons per quarter (seasonally adjusted).  This was the principal reason that the state saw big increases in greenhouse gas emissions from transportation over this time period.

Although it doesn’t explicitly say so, presumably these official ODOT forecast reflect the net effects of improving vehicle efficiency, increasing numbers of electric vehicles, and ODOT’s much vaunted “operational improvements” (i.e. electronic sign boards along highways).    What ODOT’s official revenue forecasts are telling us is that the agency fully expects us to be generating just as much greenhouse gases from driving in 2030 as we are today; indeed, the agency is counting on it, to pay its bills.

If the agency seriously believed in its climate strategy, then it would be planning for and predicting a steady decline in gasoline consumption, as we adopted more efficient vehicles, electrified and “made every mile count.”  But as its financial projections make clear, the agency has no faith that any of these measures will make any substantive difference to gasoline consumption (and therefore, greenhouse gas emissions).

Diesel Emissions

And gasoline-based CO2 emissions are just part of the puzzle.  The ODOT taxable motor fuels forecast exclude diesel fuel burned by vehicle subject to Oregon’s weight-mile tax, which is applied to heavy over-the-road trucks. The Oregon Department of Environmental Quality reports that these sources represent about 23 percent of transportation greenhouse gas emissions:

In addition to the health effects, combustion of diesel fuel is a significant source of greenhouse gas emissions. Transportation accounts for approximately 40 percent of all statewide greenhouse gas emissions in Oregon. This represents the largest source of emissions and a source that has seen increased emissions in recent years. While heavy-duty trucks and buses, which typically are fueled by diesel, only account for four percent of vehicles on the road nationally, they are responsible for nearly 25 percent of total transportation sector greenhouse gas emissions nationally, and 23 percent in Oregon. Emissions from trucks are one of the fastest growing sources of greenhouse gas emissions, and the number of truck miles traveled on the nation’s roads is projected to continue to grow significantly in the coming decades.

In its 2018 inventory, DEQ estimates that burning distillate fuels (of which diesel is the bulk), account for about 7 million tons of greenhouse gases per year; equal to about 50 percent of the amount generated by burning gasoline in cars.

ODOT also has a prediction for these weight-mile taxes, which suggests that they, too will not decrease materially between now and 2030.  That means that greenhouse gas emissions from diesel trucks will also not materially decline.  ODOT predicts that weight-mile transactions will stabilize at 2019 levels through 2025 and then increase thereafter (Figure 18).  In short, ODOT is saying that diesel truck emissions will likely remain at or above their current levels indefinitely.

And, no EVs will not save the day; By 2030, only 3 percent of Oregon vehicles will be electric, according to ODOT

The favorite dodge of highway apologists is to argue that electric vehicles will obviate the need to reduce driving at all.  Never mind that the production and operation of electric vehicles isn’t zero carbon, best estimates are that life-cycle emissions from building EVs and their batteries and charging them will produce about 30 to 50 percent of the emissions of greenhouse gases as cars.

But ODOT doesn’t expect electric vehicles to be more than a token part of the fleet in the next decade. The agency’s October 2019 revenue forecast predicts the size and composition of Oregon’s light duty vehicle fleet through 2029.  They forecast that in 2029 Oregon will have about 3.9 million light duty vehicles, but only about 120,000 of them (total) will be electric vehicles.  That’s just 3 percent of the fleet; 97 percent will still be internal combustion engines.  The slow adoption of electric vehicles, as depicted in ODOT’s official revenue forecasts, means the agency believes that its efforts to promote EVs won’t have a significant effect on the state’s greenhouse gas emissions any time in the next decade, at least.

There’s a naive and wrong-headed argument going around among highway apologists, arguing that they don’t need to worry about climate change because vehicle electrification will somehow solve the problem.  These data show that won’t happen fast enough, and in all likelihood won’t happen at all, as we continue to burn 1.7 billion gallons of taxable motor fuel a year in Oregon.

Financial projections show ODOT’s real priorities:  More greenhouse gas pollution

As Upton Sinclair observed, “It is difficult to get a man to understand something, when his salary depends on his not understanding it.”  What ODOT is saying, implicitly, is that their salaries depend on continued massive production of greenhouse gases.

In simple financial terms, ODOT is counting on—is planning on—Oregonians not doing anything to significantly reduce their consumption of fossil fuels between now and 2030.  Its plans to pay for building new highways are based on the assumption that we reduce total fuel consumption by no more than a few percent in the next decade–at exactly the time when scientists (and our adopted climate plans) tell us we need to be making the most progress toward preventing climate catastrophe.

There’s a striking contrast between the precise and hard-nosed projections of ODOT’s revenue forecast (they’re counting on us buying and burning 1.7 million gallons of taxable motor fuel every year through 2030), and the vague, PR-infused, fuzziness of Oregon DOT’s Climate Action Plan.  Part of this plan is an “Every Mile Counts” initiative, which, despite its name, doesn’t actually include any counts of vehicle miles traveled, any hard plans for reducing VMT, or any specific goals for 2030.  Instead, it’s just a vague exhortation to maybe, if you’d like, drive a bit less.  But there’s no serious plan to make that happen.

If you read the fine print of the agency’s climate plan, it’s also clear that their real priority is getting more money and building more roads.  The climate plan contains no stated goal for reducing greenhouse gas emissions from transportation (or VMT), but does specify as goals, assuring the agency has plenty of revenue and can keep building roads.

The agency’s real plan is reflected in its revenue forecast.  ODOT is planning to spend billions widening highways, and is counting on us to buy just as much fossil fuel through the next decade as we’re buying now.

If you want to know what ODOT really cares about, and the future it’s really planning for, don’t be taken in by the gauzy and performative claims to care about climate, look at the agency’s financial plans.  Money talks, and at ODOT it’s effectively saying, “we’re going to do nothing to significantly reduce greenhouse gases in Oregon, and we’re going to keep spending money to widen roads and encourage people drive more.”

Disobeying the Governor’s climate order

Oregon DOT’s financial plans show that the agency has no intention of even trying to comply with Governor Kate Brown’s Climate Emergency Order.

In 2020, the Governor ordered state agencies, including ODOT, to develop plans to reduce emissions to 45 percent below 1990 levels by 2035.  According to DEQ, Oregon’s 1990  greenhouse gas emissions from transportation fuel consumption were 16.1 million tons.  That implies that by 2035, the state’s total emissions from transportation fuels should be no higher than roughly (.55 * 16.1) 8.9 million tons.  The pathway or glide slope required to reach that level of emissions requires roughly a 4.9 percent annual decrease in from 2018 through 2029.  This glide slope implies that in 2029, emissions would need to be just under 12 million tons to be on track to meet the 2035 goal.

ODOT’s forecast makes it clear that through 2029, emissions from light duty cars and trucks (not to mention all other sources of transportation emissions, such as railroads, ships and aircraft) will be 60 percent greater than that amount—19.3 million tons.

Section 4(c)(2) of the executive order makes it clear that the 45 percent reduction applies separately to transportation fuels (e.g. gasoline and diesel fuel); the Department of Environmental Quality is directed to come up with rules that will achieve these reductions separately for transportation fuels.  Agencies like ODOT can’t claim that they’ll be able to pollute more because other sectors of the economy will somehow make even larger reductions in greenhouse gas emissions.

In effect, ODOT is keeping two sets of books:  Except that one set of books, doesn’t actually have any hard information, just vague and unverifiable claims about values and a lot of noble intent.  The real books—the ones with dollars and cents—and millions and millions of tons of greenhouse gases locked-in—are hidden in plain sight.  And the agency’s climate plans make no mention of how inconsistent the agency’s real financial plan is with its purported climate goals.  It’s a fraud and deception, pure and simple.

Appendix:  Transportation Fuels and Greenhouse Gases in Oregon

As noted, Oregon DOT forecasts taxable motor fuels sold and weight-mile transactions (a proxy for total weight mile truck volume) through 2029.  Motor fuels, when burned, produce greenhouse gases.

We’ve estimated average transportation emissions from gasoline and diesel in Oregon based on the historic relationship between the ODOT taxable motor fuels volume estimate and the DEQ annual transportation sector greenhouse gas estimate for on road gasoline and diesel fuel consumption.  On average,between 2004 and 2019, the consumption of 1,000 gallons of taxable motor fuel (as estimated by ODOT) was associated with an estimated 11.07 metric tons of transportation fuel carbon dioxide (as estimated by DEQ).  We apply this relationship to ODOT’s 2021-2029 projections to estimate greenhouse gases associated with transportation fuel consumption.

These figures likely underestimate CO2 emissions, inasmuch as ODOT projects weight-mile activity and associated diesel heavy truck emissions to increase faster than taxable motor fuels activity through 2029.  In addition, it’s worth noting that the DEQ sector estimates are considerably lower than those used in the evaluation of Oregon’s Clean Fuels Program (CFP).  The CFP requires that gasoline and diesel fuel in Oregon be blended with ethanol and biodiesel to reduce the total carbon content of fuels burnt.  The methodology used to calculate emissions under the CFP is a “well-to-wheels” metric, that counts all of the carbon emissions associated with production, refining and transport, as well as combustion, as opposed to the EPA factor which is a “tank to wheels” metric, counting just the carbon from combustion.  The CFP well-to-wheels emission factor is about 12.3 kilos of carbon per gallon of conventional gasoline, compared to the EPA “tank-to-wheels” emission factor of 8.78 kilos of carbon per gallon of conventional gasoline.  If the “well-to-wheels” approach is actually correct, this may mean that current estimates used by DEQ in its sector inventory substantially understate the relative contribution of transportation fuels to Oregon’s greenhouse gas emissions.

ODOT’s forecast only explicitly included taxable motor fuel sales, i.e. gasoline and diesel fuel used to power cars and light and medium sized trucks.  Sales of diesel fuel to larger over the road trucks is exempt from this tax, as these trucks pay the weight-mile tax instead.

The Oregon Office of Economic Analysis computes the carbon intensity of gasoline and diesel sold in Oregon under the Clean Fuels program.  It estimates that the total net effect of the program has been (which blends 10 percent ethanol with conventional gasoline, and a similar amount of biodiesel with conventional diesel), is to reduce greenhouse gas emissions from fuel consumption by an aggregate of about 5 percent, based on a “well-to-wheels” analysis.  The potential for increasing biofuels is limited; nearly 90 percent of gas-powered vehicles on the road today can only burn a maximum of ten percent ethanol.  Increasing ethanol production would have serious negative environmental impacts.

ODOT forecasts that taxable motor fuel sales in 2029 will be 1,751 million gallons.  That’s slightly more than the average fuel consumption for the years 2004 through 2019 (about 1,723 million gallons per year).  DEQ estimates that total transportation emissions from motor gasoline and distillate fuel (chiefly diesel) were about 19.6 million tons in 2019, about 22 percent above their 1990 level of 16.1 million tons.  The following chart shows estimated carbon emissions from motor gasoline and diesel fuel in Oregon, grown at the rate of increase of taxable motor fuel sales, for the period 2021 through 2029, per the ODOT Forecast.

Editor’s Note:  Thanks to Daniel Porter of ODOT and Michael Kennedy of OEA for sharing in spreadsheet form the data contained in their estimates.  This commentary revised on December 13 to correct a the percentage by which estimated 2029 emissions will exceed the amount needed to achieve the reductions called for in Governor Brown’s Executive Order.

Welcome to Portland Secretary Pete! Now about the Rose Quarter Freeway

Transportation Secretary Pete Buttigieg is visiting Oregon to learn more about local transportation issues. The local advocacy group No More Freeways has sent him an open letter to provide some background for his visit.

Here’s what Transportation Secretary Pete Buttigieg needs to know about Oregon DOT’s proposed $800 million neighborhood-wrecking, climate-destroying I-5 Rose Quarter Freeway widening project.

Under Buttigieg’s leadership, USDOT has set a new direction for US transportation policy.  He’s explicitly acknowledged the role that federally directed and supported freeway building played in destroying urban neighborhoods, especially neighborhoods of color.  And he’s called for measures to explicitly offset the damage done and restore those places.  The new administration is taking a decidedly different direction, telling TXDOT to call a timeout on its plans to widen I-45 through Houston, over concerns about civil rights.

This letter from No More Freeways tells how Portland’s freeway fight intersects with the key agenda items of the Biden Administration:  promoting equity and taking climate change seriously.

NMF_to_Secretary_Pete_July13

Burn, baby, burn: ODOT’s climate strategy

The Oregon Department of Transportation is in complete denial about climate change

Oregon DOT has drafted a so-called “Climate Action Plan” that is merely perfunctory and performative busywork.

The devastation of climate change is now blindingly manifest.  Last month, temperatures in Oregon’s capital Salem, hit 117 degrees.  The state is locked in drought, and already facing more wildfires, on top of last year’s devastating fire season.  Cities across the nation are swathed in the smoke from Western wildfires—largest among them Oregon’s Bootleg fire—and are daily witnessing orange-tinged sunsets.

Earth Observatory, July 2021.

All this is plainly due to climate change, and in Oregon, transportation is the leading source of greenhouse gases.

If there were every a time to change direction on climate, this would be it.  But plainly, the Oregon Department of Transportation is locked on cruise control, moving ahead with plans inspired by the dreams of the 1950s rather than the increasingly grim reality of the the 2050s.

ODOT’s climate denialism

While the Oregon Department of Transportation mouths the words of climate awareness, the substance of its plans make it clear that it is engaged in cynical climate denialism.  Its State Transportation Strategy (STS)—which claims to address state greenhouse gas reduction goals, never acknowledges that Oregon is failing to reduce greenhouse gases as mandated by law because of increased driving.

In Oregon, transportation, and specifically driving, is the largest single source of greenhouse gas emissions, contributing 40 percent of statewide greenhouse gases.  And while we’ve made some progress cleaning electricity generation and reducing industrial emissions, transportation greenhouse gases are increasing, up 1,000 pounds per person annually in the Portland metropolitan area over just the last five years

To date, Oregon’s and ODOT’s plans to reduce transportation greenhouse gases have amounted to less than nothing.  According to DEQ statistics, driving related greenhouse gases are were 25 percent above 1990 levels in 2018.  Given the state’s objective of reducing greenhouse gas emissions 10 percent below 1990 levels by 2020 (and 80 percent below 1990 levels by 2050), we’re headed in exactly the wrong direction.

In the face of this epic failure to make progress, and in the wake of the most extreme weather ever recorded, ODOT is proposing to actually make the problem worse by spending billions widened Portland area freeways, and going deeply into debt to do so, as we discussed earlier.

As the Oregon Environmental Council and 20 other local environmental organizations wrote to the Oregon Transportation Commission:

Transportation-related emissions make up nearly 40% of Oregon’s total greenhouse gas emissions and continue to steadily increase. The investments that ODOT has made to address climate, while valuable, are profoundly insufficient given the scale and urgency with which we must reduce emissions to avert the worst of the grim and chaotic future we are already experiencing.

ODOT’s “climate action plan”:  Cynical, meaningless and wrong

In theory, the Oregon Department of Transportation is going to combat climate change through  is a five-year climate action plan, which is supposed to represent the agency’s response to a call from Governor Brown to take climate more seriously.  It’s a sketchy and vague grab-bag of piecemeal and largely performative actions, packaged along with some deceptive claims about transportation’s contribution to climate change.  And its policies make it clear that the agency is principally concerned with continuing to build more roads, and get ever larger budgets.

A fig leaf for business as usual

Appropriately, the plan’s signature  graphic element is a single leaf—a fig-leaf as it were— superimposed over an outline of the map of Oregon. Never has an info-graphic been more appropriate:  this document is fig-leaf covering what would be, upon any closer inspection, an obscene document.

 

ODOT’s climate plan has no measurable goals and no accountability

ODOT is a staffed by engineers, so you might think they’d have some actual quantitative measures of the problem they face, and the impact of the steps they’re proposing.  his a remarkable plan which contains no statement of the problem in terms of quantities of greenhouse gases emitted, no goal for their reduction (to 25 percent of 1990 levels by 2050, as mandated by law), and no evidence that individually or collectively the measures described in the plan will have any quantitative effect on greenhouse gas emissions whatsoever.  It’s merely a perfunctory checklist of actions, which once taken, will absolve ODOT of any further responsibility to worry about climate issues.  There’s simply no accountability for any reduction in greenhouse gases.

The lack of accountability is apparent in the framing of the document; there’s no acknowledgement that transportation greenhouse gas emissions have gotten worse since the development of ODOT’s first climate fig-leaf, it’s “Sustainable  Transportation Strategy” eight years ago.

Reducing GHG’s isn’t a priority:  Getting more money for ODOT is

Climate may be in the title, but the substance of the plan is really about ODOT’s 1950s era highway-building values.  It’s clear from the get-go that this strategy actually isn’t interested in reducing greenhouse gases.  The document states clearly it has three main priorities (pages 7-8):  promoting equity, building the transportation system, and assuring ODOT has enough money.  Reducing greenhouse gases didn’t even make the list.

It’s worth noting that with equity, as with climate, there are no measurable objectives.  It’s just lip service from an agency that has repeatedly pushed city destroying highways through minority neighborhoods, and which plans to atone for this damage by making the highways even wider.

Pricing is a source of revenue, not a means to manage demand or reduce climate pollution

Potentially, pricing could have a major impact on greenhouse gas emissions.  Fuel consumption and greenhouse gas emissions actually did decrease through 2014 when gas prices were high. But ODOT has no plans to using pricing to achieve climate objectives. The plan mentions pricing, but only to pay for more roads; there’s no commitment to use pricing to reduce greenhouse gases, vehicle miles of travel or traffic congestion.  The only stated policy concern is generating enough revenue to fund ODOT construction projects,

“Pricing:  Price the transportation system appropriately to recover the full costs to maintain and operate the system.”

The plan contains no provisions to reflect price of environmental damage back to system users—ODOT wants to get paid to build more roads, but resists having it or highway users pay for the damage their emissions cause.  As we’ve noted, ODOT backed off from pricing based in part on its consultations with avowed climate change deniers it appointed to its “stakeholder” group.

Falsely claims making traffic move faster will reduce emissions

The strategy repeats a false claim that Oregon DOT can reduce emissions by making traffic move faster.  One of the plan’s action items is “System efficiency” which it defines as

“. . . improve the efficiency of the existing system to reduce congestion and vehicle emissions.”

What this really means, in practice, is that ODOT spends more money on elaborate computers, variable advisory speed signs and signboards that show estimated travel times on some highways.  None of these so called “intelligent transportation systems” have been demonstrated to measurably reduce either congestion or greenhouse gases.  Moreover, to the extent they do lower congestion, they induce additional travel demand, and the scientific literature has shown that increased travel more than wipes out any emission reductions from improved traffic flow.  This is precisely the false set of claims that ODOT conceded it made to the Legislature in 2015 when it lied about estimates of emission reductions from these “system efficiency projects.”

It’s “climate lens” is really an eye-patch, turning a blind eye to induced demand

The climate plan says a “climate lens” will be applied to the State Transportation Improvement Program (TIP) projects, but is silent on the application of any such standard to megaprojects like  the I-5 Rose Quarter project, the revived Columbia River Crossing or any of the billions in other proposed Portland area freeway widening projects.  The induced demand calculator developed by the University of California Davis from the best available science shows these kinds of freeway widening projects will produce hundreds of thousands of tons of additional greenhouse gas emissions.

The so-called “climate lens” is simply a glib PR talking point that has no impact or meaning. If you were at all serious about climate, a real climate test would have the agency put on hold all additions to state highway capacity.

The climate plan reiterates a discredited claim that greenhouse gases can be reduced by widening roads and making traffic move faster, something that’s been shown scientifically to induce more driving and pollution.

Technocratic climate denialism

Future generations, enduring the brunt of increasingly intolerable summers and extreme weather, seeing Oregon’s forests and natural beauty decimated by climate change will look back to the decisions ODOT is making now and ask how it could simply ignore this problem, ignore the demonstrated science about its causes, and then commit literally billions of dollars to make it worse, dollars that future generations will be forced to repay.

This may seem like a simple, routine technical matter.  It’s not.  Its an irrevocable commitment to burn our state, to cower in ignorance in the face of an existential challenge, and an effort to cling to an outdated ideology that created this problem.

 

It’s back, and it’s even dumber than ever: The Urban Mobility Report

There was an unprecedented decline in traffic congestion in the US last year.  According to the Urban Mobility Report, there’s essentially nothing we can learn from this experience

The Texas Transportation Institute has always been apologists and propagandists for the highway lobby

TTI reports fail the basic scientific test of responding to repeated detailed critiques of methodology, measures and findings

Every year (or so), the Texas Transportation Institute generates something called the “Urban Mobility Report,” which is a dire lamentation on the supposed costs that urban traffic congestion imposes on Americans.

This past week, they’ve issued their latest report, covering 2020.  As everyone knows, the Covid-19 pandemic produced an instant and abrupt change in US travel patterns.  And that’s noted in the latest UMR.  Their measure of congestion—which, as we’ll explain in a minute, is deeply flawed and biased—actually showed a epic decline in congestion costs in 2020.  So far, so good. But wait.

Now, for scientists and the intellectually curious, you would think that actually experiencing a dramatic decline in traffic congestion would be, if not a cause for celebration, at least an opportunity to better understand the dynamics of the problem they’re purportedly concerned with solving.

Here’s the big, salient fact about traffic in 2020:  Travel declined by about 15-20 percent, but congestion—as measured by TTI—fell by about half. Here’s the data on quarterly travel volumes in 2020 compared to the previous year.  In the second half of the year, travel was down about 15-20 percent.

While travel went down a bit, traffic congestion went down a lot.  Even in the second half of the year, as travel had rebounded, traffic congestion, measured here by TTI’s own estimate of hours of delay, was down 40 to 50 percent from 2019 levels.

As we’ve stressed at City Observatory, this non-linearity (a small decline in travel produces a big decline in congestion) is the most important insight we can have about how to deal with traffic.  In Portland, during the height of the pandemic-fueled travel reductions, the city’s major freeways carried more cars at the rush hour, at higher speeds, because traffic levels were kept below the tipping point that causes cascading delays.

Traffic congestion is a demand problem:  too much demand at certain times, specifically peak hours.  If we can reduce demand, or shift travel to off-peak times, we can dramatically reduce congestion.  We have traffic congestion because we don’t price roads; we don’t systematically reflect back to users the costs their travel decisions impose on others.

The only effective solutions to traffic congestion involve congestion pricing, but “pricing” is one word you won’t find anywhere in the 2021 Urban Mobility Report.  The word “toll” appears exactly once.

TTI has never grasped the fundamental economics of traffic congestion.  They’ve always pretended that the transportation system can be run as if every day was free ice cream day at Ben and Jerry’s.  If you don’t charge users for your product, you get lines around the block and you’re always running short of money.

The real lesson of the pandemic, if we recognize it, is that measures to alter travel demand, especially ones that incorporate real time pricing, can re-shape demand in ways that reduce congestion.  In fact, evidence from the pandemic shows that avoiding over-loading roads at peak hours can maintain consistent high travel speeds and higher levels of vehicle throughout.

However, if you read the TTI report, you’ll never learn any of that. Instead, what you’ll hear is that when the pandemic abates, the world of transportation will trend back toward increased traffic and congestion, and well, we’ll just have to build more capacity to accommodate it.

Add capacity in critical corridors — We just need “more” in some places. Increases in freight and person movement often require new or expanded facilities. Important corridors or growing regions can benefit from more street and highway lanes, new or expanded public transportation facilities, and larger bus and rail fleets.

That’s TTI doing what it has always done:  providing a rationalization for ever more highways in the name of trying—counterproductively, as it turns out—to reduce congestion.

Flawed, biased and unscientific

Though it has been produced for decades, the Texas Transportation Institute’s Urban Mobility Report is essentially propaganda for road-building, not a critical analysis of transportation policy.  It is designed to generate heat, not shed light.  We and others have repeatedly refuted and debunked the methodology, metrics, and findings in this and prior TTI reports.  Some of the highlights:

  • Its core measure of delay, the “travel time index” ignores the distance of trips across metro areas, and incorrectly penalizes cities with compact development and shorter trips, while rewarding sprawling metros with very long commutes.
  • Claims that congestion imposes net costs on travelers is based on the false assumption that enough highway capacity could be constructed so that peak hour travel was never slower than off-peak hour travel.
  • The first three decades of the report’s congestion estimates are based on a flawed and unscientific extrapolation of speed-volume tables, and are inconsistent with other measures of actual travel time.  The report presents as a single time series estimates made using wildly varying methodologies.
  • As Victoria Transportation Policy Institute’s Todd Litman has shown, the report’s authors have repeatedly failed to respond to thorough and well-researched critiques of their methodology.

Our experiences with a very changed transportation system during the Covid-19 pandemic could have been (and could still be) a powerful learning moment as to how to build more just, sustainable and efficient cities.  We observed that reducing transportation demand can greatly improve the function of the transportation system, reducing congestion and travel times, and improving air quality.  Greater emphasis on walking, biking, and repurposing public space for people instead of car movement and car storage can make our cities better places to live, rather than merely easier to drive through.  Alas, these are lessons that will never be learned by anyone who places any credence in the Urban Mobility Report.

Lower interest rates = More expensive homes

The decline in interest rates in 2020 is a huge factor in explaining the recent surge in home prices.

Population growth, a key driver of housing demand, actually slowed dramatically in the past year.

The current surge in home prices may be a short-term phenomenon.

We’re constantly being told that the housing market is hot, and that the US is facing a housing shortage. There’s no denying that home prices have risen sharply in the past year.  The broad-based S&P Core-Logic Case-Shiller index records that the average home price has jumped 14.6 percent in the past year, the fastest increase in three decades (a period that includes the housing bubble of the mid-aughts.

Case Shiller Home Price Index (via Calculated Risk)

 

Since most buyers finance their homes with long-term mortgages (plus equity from a current home, if they own one), mortgage interest rates have a profound effect on how much people can afford to pay for housing.  When mortgage rates go down, a family can afford to borrow a larger amount of money for any given level of monthly payments they can afford.  Since the Covid-19 recession, interest rates, including mortgage interest rates have fallen sharply.

Here’s the typical rate on a 30-year fixed residential mortgage.  For the past two years, mortgage rates have been declining, and since the start of the Covid-19 recession, have plummeted to the lowest levels seen in decades.

On January 2, 2020, the average mortgage rate was about 3.7 percent.  Just a year later, on January 7 of 2021, the interest rate stood a full percentage point (100 basis points in financial speak) lower, at just about 2.7 percent.  That change makes a big difference to how much homes people can afford based on their income.

For example, if you were financing a $300,000 mortgage in 2020 at 3.7 percent, your monthly payments would be about 1,380.  Here’s a mortgage calculator.

But a year later, in 2021, if you could still afford a $1,380 monthly payment, at the new lower 2.7 percent interest rate, you would now be able to swing a $340,000 mortgage.

That $40,000 increase works out to a 13.3 percent increase in the amount you could borrow, roughly in the same ballpark as the increase in home prices over the past year.  (Our simple calculation here overlooks some important details, such as needing a larger down payment for a bigger mortgage, but between government stimulus payments and big reductions in household outlays for travel, entertainment, services caused by Covid restrictions, many households saw big gains in savings during the pandemic).

It’s not population growth

Historically, one of the biggest and most easily predictable drivers of housing markets is population growth.  But thanks to direct and indirect effects of the pandemic, national population growth has fallen dramatically.  Economist Tom Lawler estimates 2020 population growth fell to 0.22 percent from a 21st Century average of about 0.72 percent.  That decline is due both to an increased death rate and subdued international in-migration.

Housing markets are big and complex, and there are many reasons why prices have risen so sharply in the past year.  But clearly one of the big factors has been the declining cost of borrowing.  Going forward the impetus to home price inflation from the recent decline in interest rates should wane (assuming mortgage interest rates don’t continue to decline at the same pace in the next year or so).  If the decline in mortgage rates is largely over, stable or increasing mortgage interest rates should actually help dampen future home price increases.

But as we all learned in the housing bubble, home price movements can become disconnected from fundamentals, and be driven by expectations of future increases.  One of the troubles with housing is that homeowners are in many respects speculators, and most buyers are purchasing a new home based in part on the growth in value of a previous home.  The current dramatic spike in home prices seems to be propelled by some short term factors, most notably the decline in interest rates.  We’ll all want to watch closely to see what happens in the months ahead.

 

The Bum’s Rush

The $800 million project transitions from “nothing has been decided” to “nothing can be changed”

There’s a kind of calculated phase-shift in the way transportation department’s talk about major projects.  For a long, long time, they’ll respond to any challenges or questions by claiming that “nothing has been decided” or that a project is still being designed, that its in its infancy, and that objections will be dealt with . . . at some point in the indefinite future.

But then, a magic moment occurs, with no notice or observable event, and they’ll suddenly proclaim that it’s too late to raise and questions or consider any changes.

That’s exactly what’s happened with the Oregon Department of Transportation’s $800 million I-5 Rose Quarter project in the past few weeks.

You’ve got concerns?  Not to worry, nothing’s been decided

As recently as last fall, ODOT’s Director of Urban Mobility, Brendan Finn was telling OPB’s Think Out Loud host Dave Miller, the project is only 15 percent designed, and that there was lots of opportunity for the community to shape the project:

Well, the project is still pretty much in its infancy, it’s only being at 15 percent design.  I don’t clearly remember the exact verbiage as far as that.  The House Bill that was passed that created the Rose Quarter project, HB 2017, did have certain parameters in it that were expected from the Legislature, and that was one of them.  That said, there is almost an amazing opportunity here to connect neighborhoods and to provide not only multi-modal options, but  community connections.  And for us, making this move right now is signaling to the community . . . especially . . . those who have left the process, that we are willing to do things differently, we are ready to change, we are ready to be deliberative about our commitment to our shared values around restorative justice.

And very publicly at that time, ODOT convened an “Historic Albina Advisory Board “(after blowing up two other efforts at community engagement) and spent several million dollars hiring a team of consultants to conduct an independent highway cover assessment.  ODOT hired a multi-million dollar team of consultants to undertake an independent analysis of the freeway covers, undertaking both a technical analysis, and seeking public opinion.  This work developed a series of alternatives that vary considerably from the proposal being designed by ODOT—devoting more space to housing  and better reconnecting the urban street grid, and moving freeway on and off ramps away from the center of project.

According to ZGF: Oregon DOT’s plan for the Rose Quarter produced irregular parcels that would be “challenging to develop” and create a complex, unintuitive street system.

This process is proceeding according to the timeline ODOT announced when it appointed this new board last year.  In May, consultants presented their analysis and recommendations to the Historic Albina Advisory Board and the project’s steering committee.  Their alternatives, included two that rate much higher technically, and in community support, and which would significantly re-design the project.

Sorry, time’s up: Too late to make any changes

Now, ODOT says, it’s simply too late to think about doing anything different than what the agency first planned.

The community has been pushing for buildable covers for years, and now ODOT says, that any consideration of covers will create unacceptable further delays.  Last week, in response to support by Oregon’s two Senators and local Congressman for buildable covers, ODOT said it was basically too late to think about doing that, according to the Portland Mercury:

A spokesperson for ODOT told the Mercury that while getting the cost of the caps fully funded by federal dollars would be “a dream,” there are still other obstacles to consider when building more substantial freeway caps. In order to build caps capable of supporting five-story buildings, the caps would need larger support pillars on either side of the freeway to ensure that there is enough structural strength to support the buildings.

“That could mean further acquisitions of land in the area, potentially displacing businesses,” said April deLeon, an ODOT spokesperson.

According to deLeon, changing the design of the caps now could also add time delays. The Federal Highway Administration would need to approve the new cap design, but would be under no timeline to do so. That time delay could make the project more expensive due to the cost of inflation.

It’s also worth noting that ODOT’s own consultants have said that buildable covers would be much more economical, if only ODOT would narrow the overly wide project to just the two additional lanes it says it needs, and built shoulders comparable to other urban freeway projects.  According to ODOT, it will build stronger covers only if it gets to condemn other people’s land, not if it has to give up any of the monstrously oversized roadway it intends to built (and then to re-stripe into a ten-lane freeway).

ODOT’s reflexive claim that its too late, and too costly to even consider buildable caps shows that their claims of interest in “restorative justice” are just a sham.  What the really want to do is build a wider freeway, and they’ll engage in whatever performative theatre they think is needed to convince people they care

Kudos to OPB’s Dave Miller for asking hard questions last fall:  But what the media generally fails to do is follow the thread and insist on accountability.  At what point did the project go from “infancy” to unchangeable?  Who made that decision?  Deus ex machina is a great literary device, but it’s no way to run a government.

More proof of ODOT’s Rose Quarter Freeway coverup

Newly revealed documents show its roadway is vastly wider than needed for traffic, and also makes “buildable” freeway covers prohibitively expensive

If you really want just two additional lanes, you can do so much more cheaply and with less environmental destruction

The reality is ODOT is planning a 10 lane freeway at the Rose Quarter, and is lying about the covers and the project’s real cost and environmental impact

For years, the Oregon Department of Transportation has been lying about the freeway widening project it plans for a mile long stretch of I-5 at Portland’s Rose Quarter.  While it’s advertised as just adding a couple of so-called “auxiliary” lanes, we and others have uncovered multiple documents showing that they’re actually planning a 150-foot to 160-foot roadway, wide enough for a ten lane freeway.

The latest confirmation of ODOT’s big lie comes from a report prepared by one of the agency’s own consultants, ARUP Associates  ARUP pointed out the obvious:  If you really want to just add two lanes to the existing 82 foot wide pavement, you certainly don’t need two double the size of the roadway.  In an article published by Willamette Week, ARUP says:

“The most significant driver of project cost (initial construction cost as well as ongoing maintenance and life-cycle costs), right-of-way impacts, and development potential on and adjacent to the covers is the cross-section width,” the draft report states, laying out various technical approaches used in other states.”We believe these options can be considered to reduce the tunnel width so as to minimize construction cost and impact to the adjacent properties.”

The ARUP report shows the Rose Quarter project could be much smaller, cheaper, and less environmentally destructive.  ARUP recommends interior shoulders of 3 to 8 feet (instead of 12); exterior shoulders of 10 feet (instead of 12), and lanes of 11 or 12 feet (instead of only 12).

ODOT claims that part of the reason for such a wide right of way is to accommodate “full” shoulders.  But ARUP’s report puts the lie to that claim.  It notes that nowhere in expensive urban freeway rebuilding projects does anyone build 12-foot inside shoulders.  Willamette Week reports:

. . . no comparable highway project in any other city includes the 12-foot inner shoulder lanes that ODOT has included in this project. (According the report, Presidio Parkway in San Francisco has 4 feet, the I-93 Central Artery in Boston has zero feet, and the Alaskan Way tunnel in Seattle has 2 feet.)

Not only that, even for this project, ODOT doesn’t think 12-foot shoulders are necessary.  On the project’s viaduct section, at the Southern end of the project, ODOT is proposing to add a freeway lane (including re-striping freeway lanes to 11 feet in width), and shoulders of 3 to 9 feet.  ODOT’s own analysis shows these narrower shoulders and lanes have a trivial impact on safety compared to a wider and more expensive project.

As we’ve maintained for several years, the real reason ODOT is planning a massive roadway with oversized shoulders is because it plans to simply re-stripe the road for additional lanes as soon as the project is built, something that could be accomplished in an afternoon with a few gallons of highway paint.  It’s a blatant attempt to evade any environmental analysis of the traffic, noise, air pollution, and greenhouse gas emissions that would be associated with building a 10 lane freeway, and is violation of the National Environmental Policy Act.

Blowing up the covers

ODOT has attempted to woke-wash this project by claiming that the construction of a highway cover (really slightly enlarged overpasses) will help repair the damage the original construction of Interstate 5 did to the Albina neighborhood in the 1960s and 1970s.  While they’ve claimed that the covers might be used for a variety of purposes, their own consultants have concluded that the current project design creates a human- and pedestrian hostile environment that’s inimical to neighborhood restoration.

The new ARUP documents make it clear that the vastly oversized roadway also makes covers much more expensive, and and in particular, makes constructing covers that could support multi-story buildings prohibitively expensive.  According to Willamette Week, project documents now show the covers construction could cost $500 million, and would cost an additional $200 million if build strong enough to support an 5-story building.

The draft Constructability and Cost Analysis Report for the Rose Quarter Independent Cover Assessment, dated June 2, estimates covering the highway would cost more than $500 million. Covers that could support five-story buildings would cost roughly $200 million more, depending on which design ODOT proceeds with.

The freeway covers have always been a transparent and disingenuous ploy to cloak this project as a vehicle of neighborhood restoration.  ODOT has not committed any funds to real reparations, in particular rebuilding any of the hundreds of houses iti demolished for highway construction in the 1950s, 1960s and 1970s  Other state highway departments have used highway funds to build housing to undo the damage of past freeway building projects, but not Oregon DOT.  If it actually cared about restoring the neighborhood, ODOT would be talking about the narrowest possible freeway, and providing more money for housing and restoring the neighborhood.  Or it could study removing the freeway entirely.  All of the glib talk about covering a vastly wider freeway, is really just a fig leaf for a deeply flawed project.

How highways finally crushed Black Tulsa

Tulsa’s Greenwood neighborhood survived the 1921 race massacre, only to be ultimately destroyed by a more unrelenting foe: Interstate highways

Black Tulsans quickly rebuilt Greenwood in the 1920s, and it flourished for decades, but was ultimately done in by freeway construction and urban renewal

Even now, Tulsa has money for more road widening, but apparently nothing for reparations.

The past week has marked the Centennial of the Tulsa Race Massacre, when hundreds of Black residents of Tulsa’s Greenwood neighborhood were brutally killed and the neighborhood, Greenwood, was leveled.  Recent news stories have made more Americans aware of this tragic chapter of our history than unfolded in May 1921:  Greenwood’s residents were shot and beaten, their homes and businesses burned and their neighborhood bombed.

What’s less known is that despite the best efforts of the violent racists, they didn’t kill Greenwood.  In fact, the neighborhood’s Black residents returned and rebuilt, in less than five years.  The rapid rebuilding, in spite of the obstacles put in its place by the City of Tulsa, and continued racial discrimination grew praise for the neighborhood’s  resilience.  In 1926, W.E.B. Dubois wrote “Black Tulsa is a happy city,“ saying:

Five little years ago, fire and blood and robbery leveled it to the ground. Scars are there, but the city is impudent and noisy. It believes in itself. Thank God for the grit of Black Tulsa.”

Rebuilt and thriving Greenwood in North Tulsa, 1930s.

Greenwood’s heyday stretched into the 1950s, and even its moniker–The Black Wall Street–dates from this period, and not before the massacre.

What finally killed Greenwood wasn’t an angry racist mob:  it was the federally funded Interstate highway system.  Coupled with urban renewal, highways built through North Tulsa’s Greenwood neighborhood in the late 1960’s did what the Klan and white racists couldn’t do:  demolish the and depopulate the place.  That’s the key conclusion of a newly published book by Carlos Moreno, which chronicles the neighborhood’s destruction, re-birth and ultimate demise at the hands of the highway builders.  NBC News interviewed Moreno, and reported:

In his new book set to be released next week, “The Victory of Greenwood,” Moreno explores how the neighborhood had a second renaissance led by Black Tulsans after the massacre, rebuilding even bigger than before. It was not the bloodshed that eventually destroyed most of Greenwood, however; rather, it was this, he said, pointing to the spaghetti of interchanges to the south and the expressway that stretches north.

Carlos Moreno & the freeway that finally crushed Greenwood (NBC News)

In an essay at Next City, Moreno explains:

What often gets erased from Greenwood’s history is its 45 years of prosperity after the massacre and the events that led to Greenwood’s second destruction: The Federal-Aid Highway Acts of 1965 and 1968. As early as 1957, Tulsa’s Comprehensive Plan included creating a ring road (locally dubbed the Inner-Dispersal Loop, or IDL); a tangle of four highways encircling the downtown area. The north (I-244) and east (U.S. 75) sections of the IDL were designed to replace the dense, diverse, mixed-use, mixed-income, pedestrian, and transit-oriented Greenwood and Kendall-Whittier neighborhoods.

As in so many other US cities, the construction of freeways was used to demolish, divide and isolate communities of color.  President Biden acknowledged the federal government’s role in Greenwood’s decline in his proclamation of a Day of Remembrance:

And in later decades, Federal investment, including Federal highway construction, tore down and cut off parts of the community. The attack on Black families and Black wealth in Greenwood persisted across generations.

At a community conversation sponsored by Tulsa Urbanists, Moreno summarized his research on the role of the 1921 race massacre and later highway building and urban renewal efforts in destroying Greenwood:

Greenwood looks the way it does today, not because of the massacre.  It came back. And there’s a video footage of that. But North Tulsa/Greenwood look the way it does today because of the federal highway project, and because of urban renewal . . .

And Tulsa continues to widen highways even as it refuses to discuss reparations for the destruction of Greenwood.  Again, Moreno:

Somehow it’s okay for Tulsa to pay $36 million to repair one mile of road between 81st and 91st on Yale in South Tulsa, like that’s okay. We have no problems doing that. We just passed a road widening bill and every single citizen of Tulsa is paying a part of that $36 million. But somehow reparations for Greenwood is a non starter . . .

A hat tip to Next City for publishing Carlos Moreno’s synopsis of his book and Graham Lee Brewer of NBC News his reporting of how the highway’s wounds still trouble Greenwood to this day.

It’s hard to imagine anything more hateful and horrific than the bloody attack on Greenwood in May, 1921.  In the past century, that kind of violent overt racism has given way to a more subtle, more pernicious and more devastating  kind of systemic or institutional racism, in the form of highway construction.

State DOTs can and should build housing to mitigate highway impacts

If OregonDOT is serious about “restorative justice” it should mitigate  highway damage by building housing

Around the country, states are subsidizing affordable housing to mitigate the damage done by highway projects

Mitigation is part of NEPA requirements and complying with federal Environmental Justice policy

The construction of urban highways has devastating effects on nearby neighborhoods.  Not only has building highways directly led to housing demolitions to provide space for roadways, the surge of traffic typically undermines the desirability of nearby homes and neighborhoods, leading to the depreciation of home values, the decline of neighborhood economic health, and population out-migration.  That story has been told numerous times across the US; we’ve detailed how the Oregon Department of Transportation’s decisions to build three huge highway projects in the 1950s, 1960s and 1970s decimated Portland’s Albina neighborhood.  This predominantly Black neighborhood lost two-thirds of its population over the course of a little more than two decades. At the time, no one gave much thought to the loss of hundreds or thousands of housing units, or the effect on these neighborhoods.  But increasingly, state highway agencies are looking to mitigate the negative effect of current and past highway construction by subsidizing housing in affected neighborhoods.  Here are three examples from around the country.

The Oregon Department of Transportation claims that it is interested in “restorative justice” for the Albina community, which has identified housing as one of the keys to building wealth and restoring the neighborhood.  And ODOT’s project illustrations show how hundreds of housing units might be built near the project–but these are just vaporaware, as ODOT hasn’t committed to spending a dime of its money to making that happen, to replacing the homes it demolished over the decades.  Based on the past and current experience of other states, there’s no reason that they can’t treat investments in housing as mitigation, just as ODOT routinely spends a portion of its highway budget on restoring wildlife habitat, creating new wetlands, or even replacing jail cells.  A real restorative justice commitment would make up for the damage done, as these examples show.

Lexington Kentucky:  A community land trust funded from highway funds

For decades, Kentucky’s highway department had been planning a freeway expansion through Davis Bottom, an historically African-American neighborhood.  The threat of freeway construction helped trigger the decline of the neighborhood.  When the road was finally built a little more than a decade ago, the state highway agency committed to restoring the damage done to the area by investing in housing.  As part of the Newtown Pike Extension project, the Kentucky Transportation Cabinet acquired 25 acres of land and provided funding to establish a community land trust for the construction of up to 100 homes.

In 2008, the Federal Highway Administration gave the project an award for this project, saying:

The Davistown project is the first CLT ever created with FHWA Highway Trust Funds. Eighty percent of the project, including the acquisition of CLT land and the redevelopment of the neighborhood, will be funded with these FHWA funds.

The FHWA Environmental Justice guide highlights the Lexington CLT as as a “best practice.”

Houston, Texas:  $27 million to build affordable housing to mitigate interstate freeway widening

Houston’s I-45 “North Houston Highway Improvement Project” would, like the I-5 Rose Quarter project, widen a freeway through an urban neighborhood.  The Texas Department of Transportation, as part of the project’s environmental impact review process has dedicated $27 million to build or improve affordable housing in neighborhoods affected by the freeway.

 

Reno Nevada, State DOT providing land and money to cities and counties for affordable housing

Nevada DOT committed to using highway funds to pay for housing to mitigate effects of freeway expansion in Reno at the junction of I-80 and US 395.

NDOT will provide funds or land already owned by NDOT to others (Cities of Reno or Sparks, Washoe County) to build affordable replacement housing for non-Reno Housing Authority displacements. Those displaced by this project who wish to remain in the area will be given priority access to the replacement housing. After those needs have been addressed, the affordable housing will then be made available to those who qualify for affordable housing but were not displaced by the project. Residents will be considered eligible for this replacement affordable housing if they meet Section 8 eligibility requirements or Reno Housing Authority’s Admission and Continued Occupancy Policy (Reno Housing Authority 2018).

Federal Regulations encourage or require mitigating impacts.

The key environmental law governing federal highway projects is the National Environmental Policy Act.  It requires that agencies identify the adverse environmental impacts of their decision, and then avoid, minimize or mitigate those impacts.  In particular, NEPA mitigation includes “restoring the affected environment” and “compensating for the impact by . . . providing substitute resources or environments.”  Using highway funds to replace housing demolished by a freeway is one key way in which the negative effects of a highway project on an urban community can be mitigated.

CFR § 1508.20 Mitigation.

Mitigation includes:

(a) Avoiding the impact altogether by not taking a certain action or parts of an action.

(b) Minimizing impacts by limiting the degree or magnitude of the action and its implementation.

(c) Rectifying the impact by repairing, rehabilitating, or restoring the affected environment.

(d) Reducing or eliminating the impact over time by preservation and maintenance operations during the life of the action.

(e) Compensating for the impact by replacing or providing substitute resources or environments.

A federal executive order on Environmental Justice directs agencies to pay particular attention to the impacts, including the cumulative impacts of agency decisions on low and moderate income people and people of color.  THe Federal Highway Administration’s Environmental Justice Policy specifically identifies impacts on neighborhoods as “adverse effects” of federal highway projects, and calls for both mitigating these impacts, and considering alternatives that minimize adverse impacts on communities.

  1. Adverse Effects. The totality of significant individual or cumulative human health or environmental effects, including interrelated social and economic effects, which may include, but are not limited to: bodily impairment, infirmity, illness or death; air, noise, and water pollution and soil contamination; destruction or disruption of human-made or natural resources; destruction or diminution of aesthetic values; destruction or disruption of community cohesion or a community’s economic vitality; destruction or disruption of the availability of public and private facilities and services; vibration; adverse employment effects; displacement of persons, businesses, farms, or nonprofit organizations; increased traffic congestion, isolation, exclusion or separation of minority or low-income individuals within a given community or from the broader community; and the denial of, reduction in, or significant delay in the receipt of, benefits of FHWA programs, policies, or activities.

FHWA Policy:  It is FHWA’s stated policy to mitigate these disproportionate effects by providing “offsetting benefits” to communities and neighborhoods, and also to consider alternatives that avoid or mitigate adverse impacts.

What is FHWA’s policy concerning Environmental Justice?  The FHWA will administer its governing statutes so as to identify and avoid discrimination and disproportionately high and adverse effects on minority populations and low-income populations by:

(2) proposing measures to avoid, minimize, and/or mitigate disproportionately high and adverse environmental or public health effects and interrelated social and economic effects, and providing offsetting benefits and opportunities to enhance communities, neighborhoods, and individuals affected by FHWA programs, policies, and activities, where permitted by law and consistent with EO 12898;

(3) considering alternatives to proposed programs, policies, and activities where such alternatives would result in avoiding and/or minimizing disproportionately high and adverse human health or environmental impacts, where permitted by law and consistent with EO 12898

Taken together, the NEPA requirements for mitigation, and the FHWA’s policy on environmental justice require FHWA projects—like the I-5 Rose Quarter Freeway Widening—to address the cumulative totality of the project’s effects on the neighborhood, including the disruption of community cohesion, the displacement of people and businesses and increased traffic congestion.  The current project adds, as we have shown, to a long history of federally supported highway projects in the Albina neighborhood that have had devastating cumulative effects, including particularly, the destruction of hundreds of housing units, which are essential to the economic well being of the neighborhood and its residents, who, historically have been lower income and people of color.  It is fully consistent with federal environmental policy and environmental justice requirements for ODOT to devote funds to rebuilding housing as a way to mitigate the damage it has done to the Albina neighborhood.

 

 

 

For a grand bargain, think bigger and bolder

Right diagnosis, weak medicine, wrong metaphor

In a far ranging thought piece for James Fallows’ Our Towns Civic Foundation—”Learning from Eisenhower and Lincoln:  A Grand Bargain for Transportation,” Patrick Doherty and  Chris Leinberger invoke Abe Lincoln and Dwight Eisenhower as role models for a Biden Administration infrastructure policy.

There’s a lot to like in this analysis, and its recommendations touch on many of the topics that are essential to crafting a solution to the problems we face.  That said, we’d offer a couple of contrasting views, and hopefully friendly amendments to the policy prescriptions, and different metaphor than the authors invoke.  This is a worthwhile conversation to have, and we’re grateful to the authors for inviting us to join.

Their essay is founded on a trenchant and accurate diagnosis of the roots of America’s social, economic and environmental crises:  public policies that have fostered excessive reliance on private automobiles.  Our obsession with cars has caused us to remake our landscape in a way that has made us all more car dependent.

Today, dense, walkable neighborhoods are in short supply and therefore command premium prices.  And they are either uneconomical or actually illegal because of our obsession with catering to cars.

Doherty and Leinberger are spot on when they diagnose this problem:  Clearly, we need to build more walkable places; the challenge is figuring out how to reduce decades of auto-centric policies, and undo the damage they’ve inflicted on the landscape.  This essay goes in the right direction, but we would urge them to go considerably further.  To paraphrase the President, we need to build back bolder, and differently.

The big challenge is equating “infrastructure” and “transportation.”   It’s unfortunate to conceptualize our core urban problems as a lack of transportation. As a metaphor, they’ve chosen Lincoln’s subsidies for transcontinental railroad construction and Eisenhower’s defense and interstate highways.  While these initiatives are suggestive of the scale of the change that’s needed, there’s a “hair of the dog” quality to this prescription.  Particularly in the case of the interstate highways, the fixation with transportation generally and cars specifically have led to massive subsidies to sprawl and dispersion.  America’s problem is not that we have too little transportation infrastructure, but that we have too much (particularly of the wrong kinds), and it has led to vast decentralization.  And in a world built for cars, it’s simply impossible to walk, and uneconomical to provide transit service.

That’s why one core feature of the Doherty and Leinberger prescription—rejiggering the formula for the the distribution of federal transportation funds to favor transit—while very much a step in the right direction is simply too weak a prescription given the scale of the problem.  Better transit would be a palliative to some of the worst effects of this car dependent system, but given the enormity of the challenge simply isn’t enough.

Let’s be clear about the magnitudes here:  The Biden American Jobs Plan (AJP) proposes $85 billion over eight years for public transit, about $10 billion per year.  (A further $80 billion would go to high speed rail; which is meritorious in its own right, but doesn’t make the bus come sooner).  In addition, except for recent pandemic aid, almost all federal transit funding goes to capital construction, and between fares and local taxes, cities are hard pressed to support the existing level of transit service, much less expand it.  Increasing transit mode share would also require a large and permanent increase in federal operating subsidies.

A key problem with transportation is that we haven’t asked cars to pay their way:  We subsidize driving in many ways, and some features of the AJP continue this.  Instead of raising the gas tax, the AJP would use higher corporate taxes.  The bill also calls for a $174 billion  subsidy for vehicle electrification.  The US has a gas tax that is a fifth of the of other industrialized nations.  Enlarging the deep subsidies to car transportation undercuts all of the efforts to invest in transit and promote dense walkable places.  A more direct and radical solution to the problem of too much driving would be a healthy increase in the gas tax, or a national carbon tax, with the proceeds dedicated to building housing and communities (as well as subsidizing transit).  Higher gas prices that fully reflected the social and environmental cost of driving fossil fueled vehicles will also help propel the electrification of the vehicle fleet.

It’s also worth noting that investments in transportation are no panacea for the problems of rural development.  The late University of Oregon economist Ed Whitelaw observed of the investments in schools and highways in Appalachia, that better schools gave kids the education and better highways enabled them to leave.  Even the legacy of the transcontinental railroads was the devastation of small scale farming in New England, which couldn’t compete against California.

Beyond investing in transportation, we’ve got to invest in place, in the civic realm that brings us together, and in building more housing in those high demand places that already have walkable amenities (and which by and large have the best transit access).  In a sense, the better Lincoln analogy would have been to the Homestead Act, rather than to transcontinental railroads.

As our friends Joe Kane, Adie Tomer and Jenny Schuetz at the Brookings Institution have written, this will require a very different approach to land use.

That leaves the country with no choice: We must prioritize development in the kinds of neighborhoods that permanently reduce total driving and consume less energy. Such human-centered neighborhoods have the added benefit of helping us adapt to climate impacts, improve public health, and promote access to activities. Encouraging their development should be a central part of any national climate resilience strategy.

We probably need to be even more blunt about the nature of our problem (Doherty and Leinberger never use the word “sprawl”) and much more explicit about our transportation goals (as Brookings suggests, we need to reduce VMT (vehicle miles traveled), which is an indicator Doherty and Leinberger don’t mention).

Doherty and Leinberger acknowledge that land use needs to change, but the threat of losing federal infrastructure funding is unlikely to change the willingness of high income neighborhoods and suburbs to exclude higher density housing.   (Many of these are ones that already have the amenities and walkablity which are in short supply). Ironically, the federal government wields much more authority to ban local practices that affect access to television a and the Internet, than they do local practices that restrict housing affordability.   They also call for “prioritizing” affordable housing near transit, but absent a monumental increase in the paltry federal funding for affordable housing, this is not going to perceptibly change community form.

All this suggests that Franklin Roosevelt is a better role model than Dwight Eisenhower.  Early on, Roosevelt focused on fixing the housing market, inventing federal mortgage insurance.  Equally important, Roosevelt’s Works Progress Administration and Civilian Conservation Corps made wide ranging investments in civic infrastructure–parks, public buildings, trails, and other assets for the public commons–that still provide value today.  In addition, throughout his administration, during the recovery from the Great Depression, and during the mobilization for World War II, the federal government poured massive resources into building public housing.

As John Kenneth Galbraith observed, the US has long been a nation of private prosperity and public poverty.  Investing in a public realm and shared civic assets, especially those that anchor and enrich walkable community spaces, strengthens our communities.

It may seem politically astute to invoke a pair of Republican presidents as role models, but given the depth and acrimony of the partisan divide, that’s likely to be fruitless in generating a bipartisan support for this measure.  Better to get the metaphor and the details right, than to implicitly reinforce the idea that more or different transportation spending will solve the problems that too much transportation spending created.

If there is something to be gleaned from Eisenhower and Lincoln (in addition to FDR), it was that each of them proclaimed and implemented an entirely new and much larger federal responsibility for a key aspect of the nation’s development.  Arguably transportation was timely in 1860 and 1956, but the nation’s needs today are different.  Viewing our problems through the lens of transportation, and constructing a grand bargain that provides more (or somewhat re-jiggered) subsidies for transportation misses the opportunity to make the principal focus placemaking and fixing the shortage and high cost of housing in walkable locations.

The real “I-5” project: $5 billion, 5 miles, $5 tolls

The intentionally misleading re-brand of the failed Columbia River Crossing conceals the key fact that it is a 12-lane wide, 5 mile long freeway that just happens to cross a river, not a “bridge replacement.”

It’s vastly oversized and over-priced, with current cost estimate ranging as high as nearly $5 billion (before cost-overruns), which will necessitate round trip tolls of at least $5 for everyone using the bridge.

This part of the “I-5 bridge replacement” isn’t even the bridge, it’s the widened approach on Hayden Island. (Bike Portland)

Almost a decade ago, plans for a gigantic freeway-widening between Portland and Vancouver collapsed in the face of budget concerns and deep community disagreements about the project.  For the past year, the Oregon and Washington transportation departments have been trying to breath life into the zombie project—with the help of $40 million in consultants. The project’s-PR led marketing effort has systematically concealed the fundamental facts of the project, while promoting meaningless, unquantified and unenforceable platitudes about promoting equity and responding to climate change.

Like the original Columbia River Crossing (CRC) project, its an intellectually bankrupt sales pitch, not an honest conversation about alternatives.

It’s been apparent for months now that ODOT and WSDOT are trying to pressure the two states into recycling the project’s current record of decision–now more than a decade old.  That “ROD” as it’s called, specifies a massive freeway expansion illustrated above.  While the agency is hinting at the possibility of “design” tweaks—it’s apparent that their plan is to simply recycle the failed CRC proposal.

They’ve rebranded  it the “I-5 Bridge Replacement” but that’s an intentionally misleading title.  Sounds innocuous, right?  Who can be against merely “replacing” a bridge?

The only part of that branding that’s right is the number 5.

But they’ve left out the real meaning of the “5” in the title.  There are really three “5’s” that really define this project.  According to the project’s own documents: It’s five miles long, it’’ll cost $5 billion, and they’ll charge you $5 for a round trip.

It’s not a bridge “replacement” — It’s a five-mile long, 12-lane wide freeway that just happens to cross a river.  It stretches five miles from Lombard to Mill Plain Boulevard.

It’s 12 lanes over the Columbia River, and even wider on Hayden Island, as the above illustration shows.  Congressman Peter DeFazio has called the plan “gold-plated.” (Manning, Jeff. “Columbia River Crossing could be a casualty of the federal budget crunch”, The Oregonian, August 14, 2011).

It’s going to cost upwards of $5 billion, a—and likely more because they routinely have massive cost overruns.

According to their tolling financial estimates, which are part of the current finance plan, they’ll charge a minimum toll of $2.60 each way to cross the bridge, which works out to more than $5 per round trip. Peak tolls would be higher, and heavy trucks would pay four times as much as cars ($20 per round trip, minimum).

It’s time for ODOT and WSDOT to be honest about what they’re really proposing, the 5-5-5 project: 5 miles of freeway, $5 billion, $5 tolls per round trip.

Getting real about restorative justice in Albina

Drawings don’t constitute restorative justice

ODOT shows fancy drawings about what might be built, but isn’t talking about actually paying to build anything

Just building the housing shown in its diagrams would require $160 million to $260 million

Even that would replace only a fraction of the housing destroyed by ODOT highway building in Albina

The Oregon Department of Transportation is going to great lengths to cloak its $800 million I-5 Rose Quarter Freeway widening project in the language of restorative justice.  Starting in the 1950s, ODOT built not just one or two, but three different highways through the historically Black Albina neighborhood, and is now back with plans to widen the largest of these, but is now pretending to care about restoring the neighborhood.  To that end, its appointed an “Historic Albina Advisory Board”—after disbanding another community advisory group which had asked too many uncomfortable questions.

Housing is essential to restorative justice in Albina

The real challenge to restorative justice in Albina is more housing.  The aerial photo here shows the Albina neighborhood as it existed in 1948; the red-lined areas are properties takes or demolished for the construction of Interstate Avenue in 1951, the I-5 Freeway in 1961 and the Fremont Bridge and aborted Prescott Freeway in the early 1970s.  Albina was torn apart by these ODOT highway projects and its housing stock decimated. Given that ODOT’s highway building triggered the destruction of thousands of homes in Albina (the neighborhood’s population declined by more than 60 percent, from 14,000 to less than 4,000, it’s hardly surprising that getting more housing built is a key priority.

 

The ODOT consultants report that that one of the key strategies for building community wealth is to create affordable housing.

ODOT’s making it look like there will be housing as part of its plans

ODOT staff and consultants have presented the HAAB with surveys and focus group information on what restorative justice might look like.  An “Independent Cover Assessment” consulting group has even prepared drawings showing alternative development plans for the area near I-5.  The drawings feature examples from other cities of Black cultural and community facilities, and prominently include diagrams showing large new multifamily housing to be built on top of or near the freeway.  Here are two such diagrams, (the yellow colored buildings are residential apartments).  Concept 1 has four large residential buildings, Concept 5 has 5 large residential buildings.

 

But who’s going to pay for that housing?  It’s going to cost $160-260 million and ODOT is offering . . nothing.

It’s all well and good to talk about housing, but how, exactly, would it get built?  These colorful illustrations are really just misleading puffery and magical thinking unless there’s a realistic plan for paying for the project.  The availability of the land is the easy part.  The hard part is getting money for construction.  To get an idea of how much it would cost, we can look just a few blocks away to the newly completed Louisa Flowers Building.  It was just finished and has 204 studio, one bedroom and two bedroom apartments.  Its development and construction cost about $71 million, and Home Forward, the city of Portland’s housing agency paid $3 million for the site.  The project cost about $380 per square foot, with the overall cost per housing unit working out to about $350,000.

The Louisa Flowers affordable housing building in Portland (Portland Tribune)

The Independent Cover Assessment shows that the residential buildings (shown in yellow) in its two concepts would make up about half to 60 percent of the 900,000 to 1.1 million square feet of buildings to be build atop or adjacent to the freeway.  Those figures imply about 430,000 square feet or about 470 apartments in Scenario 1, to 680,000 square feet or roughly 740 apartments in Scenario 5.

If you could build those apartments for the same cost as Louisa Flowers (you couldn’t, of course; costs have gone up), that means the yellow colored buildings shown in these renderings would cost between $160 million and $260 million to develop and construct.

In short, unless you’ve got between $160 and $260 million (just for the housing part, mind you), those pictures are just a fantasy.

If ODOT actually had a budget for the construction of that housing, in order to, you know, promote restorative justice, then it would be perfectly valid to include this as part of the project discussion.  But ODOT hasn’t committed a dime to actually paying to build this housing.

And you could say, in theory, (and it would have to be theoretical, because ODOT has made no such commitment), that ODOT would be contributing the land for these buildings.  But as noted in the case of Louisa Flowers, the cost of the land is less than 5 percent of the cost of constructing the project.  If housing is key to restorative justice in Albina, and if ODOT is committed to restorative justice, it seems like it ought to come up with the other 95 percent as well, rather than expecting unnamed others to do the heavy lifting for it.

Housing is essential to restorative justice in Albina.  Simply drawing pictures of housing isn’t justice, it’s cynical vaporware, an attempt to create the illusion that ODOT cares, when its only real interest is in building a vastly wider freeway.  The state highway department readily spent money to demolish housing in the 1950s, 1960s and 1970s, but apparently isn’t willing to spend any of its money to replace that housing today. And the irony is, if you really want to have restorative justice and more housing, you don’t need to build a wider freeway.  In fact, a wider road would make the area less desirable for housing. ODOT’s plan to widen the freeway—and further inundate this neighborhood with more car traffic—doesn’t so much heal the repeated wounds it has inflicted on Albina, as it does to make them even worse.

 

The NIMBYs made $6 trillion last year

In 2021, US residential values increased by $6.9 trillion, almost entirely due to price appreciation

Those gains went disproportionately to older, white, higher income households

Capital gains on housing in 2021 were ten times larger than the total income of the bottom 20 percent of the population.

Little of this income will be taxed due to the exemption on capital gains for owner-occupied homes

Gains to homeowners dwarf the profits made by developers, foreign investors, or Wall Street home buyers.

Rising home prices are a transfer of wealth to older generations from younger ones.

So much of our housing debate is a search for suitable villains on which to blame a lack of affordability.  Our problems must be due to rapacious developers, greedy landlords, absentee speculator owners, buying new housing and holding of the market, and private companies buying up and renting out single family homes.  These are the cartoon characters who get blamed for driving up prices.  But they aren’t the ones to blame, and they’re not the ones who are making a killing in the housing market.

Housing affordability melodrama: Where’s Snidely? Sirsalem1, CC BY-SA 4.0 via Wikimedia Commons

The real estate speculators reaping literally trillions of dollars of gains from our capitalist housing system are millions of homeowners, who, whether they acknowledge it or not, are the beneficiaries of “Not in my back yard” policies that have driven up the price of housing.  And this surge of homeowner wealth is a rotten development from the standpoint of addressing yawning disparities by race, income and generation, as the beneficiares of these gains are statistically higher income, whiter and older than the overall US population.

Last year, according to calculations from Zillow, the value of existing residential real estate in the US grew by $6.9 trillion.  (New residential buildings—the construction and upgrading of homes and apartments—contributed about $800 billion).  The gain home values in 2021 was nearly triple the $2 trillion or or so increase in residential values Zillow reported in 2022.  In the post-pandemic era, we’re getting a bit inured to counting  “trillions.”  To put the amount of housing capital gains in perspective, the $6.9 trillion dollar one-year increase in home values is more than ten times the total pre-tax income of the bottom twenty percent of US households (about $600 billion in 2018, according to the Congressional Budget Office).

Here’s another picture of how much housing wealth has been created.  The Federal Reserve tracks “homeowner’s equity”—the net amount of wealth that homeowners have after subtracting outstanding mortgage debt from home values.  After the collapse of the housing bubble, owner’s equity stood at about $10 trillion, and since then has ballooned to $26 trillion.

 

To get an idea of exactly who reaped those gains, we took a look at data compiled by the Federal Reserve Board on the demographics of homeownership. The Fed’s triennial Survey of Consumer Finance provides estimates by age, race and income of homeownership rates and the average value of housing for the nation’s households.  Using these data, we computed the number of households by race and age of the household head (which the Fed Survey tactfully calls “the reference person”) and by the income of the household.  We’ve combined the value of owner-occupied residential property with other residential property owned by households (i.e. second homes, investment houses or apartments).  The Fed’s estimates (based on its household survey) are somewhat different from Zillow’s (derived from its database of homes), but both put total value of US residential real estate in the $30-$40 trillion range.  To a first approximation, these data on the age, race and income of homeowners are our best guide to who reaped the $6 trillion in residential capital gains this year.  That assumption masks some variability in housing price appreciation across markets and classes of homes, but this should be a good rough indicator of the demographics of the nation’s housing wealth winners.

The gerontopoly of housing wealth

As we’ve noted before at City Observatory, older Americans hold most US housing wealth, and have been chalking up a disproportionate share of gains as housing has appreciated.  The latest data from the Federal Reserve show that households headed by a person aged 55 and older own 56 percent of all residential housing wealth in the US. It’s a fair guess that these older homeowners reaped most of the gain in home values in the past year.

As Ed Glaeser has pointed out, rising real housing costs are a straightforward transfer of wealth from younger generations (who must buy the now more expensive homes) to older generations (who own the housing, and will reap gains when it is sold).

The long shadow of race

For a long list of reasons—including discrimination in housing and labor markets, redlining, and segregation—households of color have been systematically denied the opportunities to accumulate housing wealth.  That pattern is still very much in evidence in the latest Fed data:  Non-Hispanic white households own almost 80 percent of all the housing wealth in the US, implying they also reaped 80 percent of the residential capital gains, or about $1.6 billion.

Rising home prices effectively increase the wealth of white households relative to households of color.

High income households own most housing 

While homeownership is touted as a means of wealth accumulation, it has mostly worked out for high income households. While the ownership of real estate is not as skewed to high income households as is the ownership of financial assets like stocks or bonds, it is still the case that the highest income 20 percent of the population owns 59 percent of all the residential housing value in the US.

These data suggest that about $1.2 trillion of the gain in home values went to the top 20 percent of the population, meaning that their residential capital gains exceeded by a factor of about two the total pre-tax income of the bottom 20 percent of the population.

Housing appreciation is untaxed, which benefits older, white and wealthier households

The skewed ownership of housing wealth means that the gains in wealth are highly concentrated in households that are older, whiter, and higher income than other Americans.  But unlike wage income, income from housing appreciation is mostly un-taxed. As a result, the capital gains exclusion for housing is regressive and inequitable.  The capital gains exclusion for owner-occupied real estate,is much more valuable to high income households because they are more likely to own homes, own more expensive homes, and generally face higher tax rates that low income households.

In reality, the $2.2 trillion in capital gains that US residential property owners reaped in 2020 will be lightly taxed, to the extent they are taxed at all.  Federal law exempts from capital gains the first $500,000 in gains on the sale of owner occupied property (for married couples filing jointly).  That is to say that you would need $500,000 of appreciation to have any capital gains liability.  As a practical matter, few households pay capital gains taxes on residential real estate appreciation.  The tax-favored status of income from residential real-estate speculation is a quintessential feature of our system that attempts to promote wealth-building through home ownership.  While well intended, it systematically rewards older, whiter and wealthier households, and effectively denies opportunities to build wealth to the third of the population that is renters.  In many ways, it is the worst of all worlds, making housing more expensive for those least able to afford it, and providing most of the gains to those who are already most advantaged.

There’s one final irony here:  policies to broaden access to homeownership now, by providing subsidies or other support for lower income, younger, and minority homebuyers don’t rectify these gaps, they likely make them worse.  Steps to amplify demand in a surging market tend to drive prices up further, which further enriches incumbent homeowners at the expense of first-time buyers.  If you could enable people to somehow buy houses at 1990 or 2010 prices, they could be assured of wealth gains, but the risk is that buying now offers no such expectation of long term gains. Promoting homeownership primarily helps those who are selling homes, not those who are buying them.

The search for villains

Rather than talk about the capital gains that flow to older, wealthier, whiter households, much of the housing debate is a melodrama, looking to cast suitably evil villains on which to blame the crisis.  It’s fashionable to finger Wall Street investors (who for the past decade or so have been buying up single family homes and renting them in many US markets), foreign buyers of luxury condominiums in New York, Miami, Seattle and other hot cities (who let the units sit vacant while speculating on higher values), and greedy developers, who make excessive profits by building new homes.  None of these supposed villains accounts for more than a trivial part of the problem; at most, they’re picking up crumbs, compared to the the trillion dollar gains logged by incumbent homeowners.

A recent article in the New York Times suggests Wall Street backed investors now own as much as $60 billion in single family real estate.  That’s sounds ominous, but it’s less than 1 percent of the $35 trillion or so of residential investment in the US.  If all these investors earned a 10 percent capital gain in 2020, they would have collectively gotten about $6 billion or a couple of tenths of one percent of the $2.2 trillion in home values. It’s also fashionable to blame the construction of luxury condos in a few superstar cities—held vacant by rich, often foreign speculators.  The trouble is that such units are a tiny slice of the housing market, and there’s no evidence they affect overall housing costs.

And then there are the developers.  Supposedly they make a killing from building new housing. When housing price are appreciating, especially as fast as they have in the past year, the profits that developers earn from building new housing are dwarfed by the capital gains reaped by existing homeowners.  Our friend Josh Lehner, an economist with the Oregon Office of Economic Analysis, has an insightful study estimating the profits earned by homeowners and developers in Oregon over the past decade.  Lehner estimates, that on average, developers reap a margin of about 14 percent on new housing construction.  By comparing that total (14 percent of the value of new housing built in any year), with the appreciation of the existing housing stock in that same year, Lehner is able to show how developers profits stack up against the capital gains enjoyed by incumbent homeowners.  It isn’t even close:

Applied to Zillow’s estimates of national level new construction, Lehner’s 14 percent of building value estimate suggests that developers netted less than $40 billion nationally, an amount equal to about 2 percent of the gains that accrued to owners of existing homes.  It’s not the greedy developer that’s benefiting from rising home prices, it’s the NIMBYs next door who reap the gains.  As our colleague Daniel Kay Hertz has pointed out, we tend to conveniently forget that essentially all of the existing housing stock came into being, not by immaculate conception, but by the profit-motivated efforts of earlier generations of developers. If anything, because new development increases housing supply, it blunts housing price appreciation, so more development tends to increase affordability.

Wall Street investors, speculating oligarchs, and greedy developers all make signature villains in the housing affordability melodrama, but they really conceal the identity of those who are actually reaping the gains of rising housing prices.  It also hides the principal policy that’s driven the appreciation of residential real estate:  the dominance of a range of “Not in my back yard” policies, including excessive single family zoning, apartment bans, high development fees, parking requirements and a host of other policies that have made it harder to build housing, especially in the places people most want to live.

The experience of the past year illustrates the profoundly broken nature our current strategy of “wealth building through home ownership.”  The benefits of home price appreciation accrue disproportionately to those who already have wealth, and if anything, they tend to worsen the existing disparities of wealth among households.  As existing housing appreciates, it increases the wealth of the incumbent homeowners, who are disproportionately white, older and wealthier, and drives up housing costs for those who don’t now own homes.  And our tax system amplifies these inequities by allowing nearly all of this income to go untaxed.  The myth of homeownership as a universal wealth building strategy is the real villain here.

A version of this commentary was originally published in 2021, and has been updated to reflect the latest data on home price appreciate estimated by Zillow.

 

 

Who got trillions? We found the real speculators profiting from higher housing costs

In 2020, US residential values increased by $2.2 trillion

Those gains went disproportionately to older, white, higher income households

Capital gains on housing in 2020 were more than three times larger than the total income of the bottom 20 percent of the population.

Little of this income will be taxed due to the exemption on capital gains for owner-occupied homes

Gains to homeowners dwarf the profits made by developers, foreign investors, or Wall Street home buyers.

Rising home prices are a transfer of wealth to older generations from younger ones.

So much of our housing debate is a search for suitable villains on which to blame a lack of affordability.  Our problems must be due to rapacious developers, greedy landlords, absentee speculator owners, buying new housing and holding of the market, and private companies buying up and renting out single family homes.  These are the cartoon characters who get blamed for driving up prices.  But they aren’t the ones to blame, and they’re not the ones who are making a killing in the housing market.

Housing affordability melodrama: Where’s Snidely? Sirsalem1, CC BY-SA 4.0 via Wikimedia Commons

At City Observatory, we’re proud to announce we’ve found the real estate speculators reaping the literally trillions of dollars of gains from our capitalist housing system:  millions of homeowners, who are statistically higher income, whiter and older than the overall US population.

Last year, according to calculations from Zillow, the value of existing residential real estate in the US grew by $2.2 trillion.  (New construction added a paltry $275 billion in new homes and apartments to that total).  Given current price trends, Zillow expects another $2 trillion or so increase in residential values in 2021.

In the post-pandemic era, we’re getting a bit inured to counting  “trillions.”  To put the amount of housing capital gains in perspective, the $2.2 trillion dollar one-year increase in home values is more than three times the total pre-tax income of the bottom twenty percent of US households (less than $600 billion in 2017, according to the Congressional Budget Office).

To get an idea of exactly who reaped those gains, we took a look at data compiled by the Federal Reserve Board on the demographics of homeownership. The Fed’s triennial Survey of Consumer Finance provides estimates by age, race and income of homeownership rates and the average value of housing for the nation’s households.  Using these data, we computed the number of households by race and age of the household head (which the Fed Survey tactfully calls “the reference person”) and by the income of the household.  We’ve combined the value of owner-occupied residential property with other residential property owned by households (i.e. second homes, investment houses or apartments).  The Fed’s estimates (based on its household survey) are somewhat different from Zillow’s (derived from its database of homes), but both put total value of US residential real estate in the $30-$40 trillion range.  To a first approximation, these data on the age, race and income of homeowners are our best guide to who reaped the $2 trillion in residential capital gains this year.  That assumption masks some variability in housing price appreciation across markets and classes of homes, but this should be a good rough indicator of the demographics of the nation’s housing wealth winners.

The gerontopoly of housing wealth

As we’ve noted before at City Observatory, older Americans hold most US housing wealth, and have been chalking up a disproportionate share of gains as housing has appreciated.  The latest data from the Federal Reserve show that households headed by a person aged 55 and older own 56 percent of all residential housing wealth in the US. It’s a fair guess that these older homeowners reaped most of the gain in home values in the past year.

As Ed Glaeser has pointed out, rising real housing costs are a straightforward transfer of wealth from younger generations (who must buy the now more expensive homes) to older generations (who own the housing, and will reap gains when it is sold).

The long shadow of race

For a long list of reasons—including discrimination in housing and labor markets, redlining, and segregation—households of color have been systematically denied the opportunities to accumulate housing wealth.  That pattern is still very much in evidence in the latest Fed data:  Non-Hispanic white households own almost 80 percent of all the housing wealth in the US, implying they also reaped 80 percent of the residential capital gains, or about $1.6 billion.

Rising home prices effectively increase the wealth of white households relative to households of color.

High income households own most housing 

While homeownership is touted as a means of wealth accumulation, it has mostly worked out for high income households. While the ownership of real estate is not as skewed to high income households as is the ownership of financial assets like stocks or bonds, it is still the case that the highest income 20 percent of the population owns 59 percent of all the residential housing value in the US.

These data suggest that about $1.2 trillion of the gain in home values went to the top 20 percent of the population, meaning that their residential capital gains exceeded by a factor of about two the total pre-tax income of the bottom 20 percent of the population.

Housing appreciation is untaxed, which benefits older, white and wealthier households

The skewed ownership of housing wealth means that the gains in wealth are highly concentrated in households that are older, whiter, and higher income than other Americans.  But unlike wage income, income from housing appreciation is mostly un-taxed. As a result, the capital gains exclusion for housing is regressive and inequitable.  The capital gains exclusion for owner-occupied real estate,is much more valuable to high income households because they are more likely to own homes, own more expensive homes, and generally face higher tax rates that low income households.

In reality, the $2.2 trillion in capital gains that US residential property owners reaped in 2020 will be lightly taxed, to the extent they are taxed at all.  Federal law exempts from capital gains the first $500,000 in gains on the sale of owner occupied property (for married couples filing jointly).  That is to say that you would need $500,000 of appreciation to have any capital gains liability.  As a practical matter, few households pay capital gains taxes on residential real estate appreciation.  The tax-favored status of income from residential real-estate speculation is a quintessential feature of our system that attempts to promote wealth-building through home ownership.  While well intended, it systematically rewards older, whiter and wealthier households, and effectively denies opportunities to build wealth to the third of the population that is renters.  In many ways, it is the worst of all worlds, making housing more expensive for those least able to afford it, and providing most of the gains to those who are already most advantaged.

There’s one final irony here:  policies to broaden access to homeownership now, by providing subsidies or other support for lower income, younger, and minority homebuyers don’t rectify these gaps, they likely make them worse.  Steps to amplify demand in a surging market tend to drive prices up further, which further enriches incumbent homeowners at the expense of first-time buyers.  If you could enable people to somehow buy houses at 1990 or 2010 prices, they could be assured of wealth gains, but the risk is that buying now offers no such expectation of long term gains. Promoting homeownership primarily helps those who are selling homes, not those who are buying them.

The search for villains

Rather than talk about the capital gains that flow to older, wealthier, whiter households, much of the housing debate is a melodrama, looking to cast suitably evil villains on which to blame the crisis.  It’s fashionable to finger Wall Street investors (who for the past decade or so have been buying up single family homes and renting them in many US markets), foreign buyers of luxury condominiums in New York, Miami, Seattle and other hot cities (who let the units sit vacant while speculating on higher values), and greedy developers, who make excessive profits by building new homes.  None of these supposed villains accounts for more than a trivial part of the problem; at most, they’re picking up crumbs, compared to the the trillion dollar gains logged by incumbent homeowners.

A recent article in the New York Times suggests Wall Street backed investors now own as much as $60 billion in single family real estate.  That’s sounds ominous, but it’s less than 1 percent of the $35 trillion or so of residential investment in the US.  If all these investors earned a 10 percent capital gain in 2020, they would have collectively gotten about $6 billion or a couple of tenths of one percent of the $2.2 trillion in home values. It’s also fashionable to blame the construction of luxury condos in a few superstar cities—held vacant by rich, often foreign speculators.  The trouble is that such units are a tiny slice of the housing market, and there’s no evidence they affect overall housing costs.

And then there are the developers.  Supposedly they make a killing from building new housing. When housing price are appreciating, especially as fast as they have in the past year, the profits that developers earn from building new housing are dwarfed by the capital gains reaped by existing homeowners.  Our friend Josh Lehner, an economist with the Oregon Office of Economic Analysis, has an insightful study estimating the profits earned by homeowners and developers in Oregon over the past decade.  Lehner estimates, that on average, developers reap a margin of about 14 percent on new housing construction.  By comparing that total (14 percent of the value of new housing built in any year), with the appreciation of the existing housing stock in that same year, Lehner is able to show how developers profits stack up against the capital gains enjoyed by incumbent homeowners.  It isn’t even close:

Applied to Zillow’s estimates of national level new construction, Lehner’s 14 percent of building value estimate suggests that developers netted less than $40 billion nationally, an amount equal to about 2 percent of the gains that accrued to owners of existing homes.  It’s not the greedy developer that’s benefiting from rising home prices, it’s the NIMBYs next door who reap the gains.  As our colleague Daniel Kay Hertz has pointed out, we tend to conveniently forget that essentially all of the existing housing stock came into being, not by immaculate conception, but by the profit-motivated efforts of earlier generations of developers. If anything, because new development increases housing supply, it blunts housing price appreciation, so more development tends to increase affordability.

Wall Street investors, speculating oligarchs, and greedy developers all make signature villains in the housing affordability melodrama, but they really conceal the identity of those who are actually reaping the gains of rising housing prices.

The experience of the past year illustrates the profoundly broken nature our current strategy of “wealth building through home ownership.”  The benefits of home price appreciation accrue disproportionately to those who already have wealth, and if anything, they tend to worsen the existing disparities of wealth among households.  As existing housing appreciates, it increases the wealth of the incumbent homeowners, who are disproportionately white, older and wealthier, and drives up housing costs for those who don’t now own homes.  And our tax system amplifies these inequities by allowing nearly all of this income to go untaxed.  The myth of homeownership as a universal wealth building strategy is the real villain here.

 

ODOT’s peer review panel admits it didn’t validate Rose Quarter travel forecasts

ODOT has claimed a “peer review panel” vindicated its air pollution analysis

Now the panel says they didn’t look into the accuracy of ODOT’s travel forecast

Travel forecasts are critical, because they determine air and noise pollution impacts

In short:  the peers have done nothing to disprove the critiques of ODOT’s flawed traffic modeling

A key claim opponents made about the I-5 Rose Quarter freeway-widening project is that the traffic projections are wrong, over-stating baseline traffic by pretending the CRC was built in 2015, exaggerating “no-build” traffic levels by allowing link volumes to exceed capacity, and under-estimating “build” volumes by failing to account for induced demand and also modeling a 6-lane roadway rather than the 8- or 10-lane roadway they’re actually constructing.

ODOT’s defense is that their environmental modeling was endorsed by a so-called independent peer review panel.  As we pointed out when panel’s report was released, this was largely a whitewash.  As we wrote at City Observatory last June, when the Panel’s report was released, the critical problem was that the panel failed to look at the flawed traffic projections on which the air and noise estimates are based.  We wrote:

In theory, the PRP undertook an environmental review, looking at air pollution, greenhouse gases and noise pollution. But because all these impacts depend on the volume of traffic and whether the project increases or decreases traffic, they are all subsidiary to the accuracy of the traffic modeling. And the panel apparently did absolutely nothing to validate the accuracy of these traffic projections.

The air and noise impacts of the project come from vehicles using the freeway; both air pollution and noise pollution increase with the increasing number of cars and trucks on the roadway.  If ODOT got the traffic numbers wrong, then the pollution estimates are wrong as well.

The Peer Review Panel admits it didn’t evaluate the validity of traffic forecasts

Earlier this month, the leader of the peer review panel publicly acknowledged that the group she led did not take any critical look at the travel forecasts.  On April 5, ODOT consultant and panel facilitator Grace Crunican presented the so-called “peer review” panel results to the Historic Albina Advisory Board.   Board member John Washington asked about the traffic projections. Crunican  said that the peer review committee didn’t judge whether their were accurate or appropriate and only looked at whether the model’s outputs were correctly used to compute air/noise impacts.
Here’s the transcript:

John Washington  (Historic Albina Advisory Board)
We had a public announcement about some people suing us or something, right. And how closely related is what they’re talking about to what you’re talking about?

Grace Crunican  (ODOT Peer Review Consultant)
It is related. What they [No More Freeways] are saying is that the traffic data that was provided, that ODOT provided as a basis of the analysis that they did, is not accurate. We were not charged with looking at that traffic analysis original data.  We were looking at the implications of the traffic data that was there. We did ask some questions about it and we got mostly the information, some of the information, Megan gave us today.  She can say it again, but in my lay terms, she used the models from the metro area, she used Metro’s models and she used City of Portland’s model. And they did their analysis and then what we looked at is, given how much traffic was going through, and we look at the air quality analysis that was done. And that’s where our work was, and so the underlying data is what somebody is trying to challenge, the No [More] freeway people, I think are trying to challenge, and we looked at how that data was applied, and found that it was applied appropriately.

Historic Albina Advisory Board, April 5, 2021,  Meeting Video at 1:03:45.  (Emphasis added)

Crunican: “we were not charged with looking at that traffic analysis.” (Youtube)

In effect, the peer review panel simply assumed that ODOT’s traffic projections were right.  It took no independent effort to examine those projections, nor did it consider any of the technical objections that No More Freeways and other commenters offered to the model.  For reference, City Observatory has documented the critique extensively:  It includes inflated baseline traffic due the counterfactual assumption that the Columbia River Crossing was built in 2015; the over-assignment of traffic to congested road links in the No-Build scenario, and the failure to model the effects of induced demand in the build scenario, as well as the fact that ODOT modeled a six-lane freeway, rather than the 10-lane roadway that the project actually proposes to construct.
This is important because ODOT relied on the peer review panel to discredit the critique of its flawed traffic modeling. When it released the report, in June 2020, it claimed that the peer review  “supported ODOT’s findings for air, greenhouse gas and noise impacts” for the freeway widening.

 In January 2020, the Oregon Transportation Commission directed ODOT to conduct an environmental peer review associated with the project’s Environmental Assessment after hearing stakeholder concern over the potential impacts from the project related to air quality, noise and greenhouse gas emissions.  The Peer Review Report supported ODOT’s findings for air, greenhouse gas, and noise impacts for the project.

Most recently, ODOT used the peer review panel as a kind of talisman to ward off criticism after No More Freeways filed suit against the Federal Highway Administration challenging the project.  Here is ODOT spokesperson Tia Williams in Willamette Week:

“This project underwent a robust environmental assessment that showed future air quality would improve in part due to the congestion relief provided by this project. Those findings were reviewed and confirmed by a panel of national air quality and transportation experts. We are confident in the findings,” a statement from ODOT provided by spokesperson Tia Williams said.

At long last, the peer review panel has shown a modicum of independence:  It has made it clear that claims that its review “supports” ODOT’s work and “confirms” its findings are simply false.  The panel members were instructed to look only at a small, and as it turns out, derivative question, and simply ignored whether the freeway widening increases traffic.  This is hardly a reasonable basis for a claim that this project has “no significant environmental impact.”

The freight fable: Moving trucks is not longer the key to economic prosperity

It is difficult to get a man to understand something when his salary depends upon his not understanding it.  Upton Sinclair

It’s even harder to get a trucking industry lobbyist or a highway department booster to understand something when their salaries depend on not understanding it.

Oregon’s economy has de-coupled from freight movement; our economic success stems from doing things other that simply moving more and more freight.

State officials and the trucking lobbyists they’ve hand-picked as “public” representatives are selling myths in an effort to justify wasting billions to expand highways.

Here’s a simple fact:  Truck movements across the Columbia River in Portland are down 19 percent in the past fifteen years.  This fact comes from data tabulated by the Oregon Department of Transportation, which has automatic vehicle counters on the roadways leading up to the I-5 and I-205 bridges that connect Oregon and Washington.  Here’s the data, which is taken directly from the traffic counting website operated by ODOT.  It shows heavy freight truck movements.

For highway boosters, this simple fact is an inconvenient truth.  Here’s why:  they’re trying to justify a nearly $5 billion freeway widening project on Interstate 5 as somehow essential to accomodating a flood of trucks, which if they’re delayed even slightly, will somehow mean the demise of one of the nation’s most robust metropolitan economies.  Don’t get us wrong, traffic congestion is a routine feature of successful metropolitan economies, but there’s actually no evidence that adding a freeway lane (or three) has any measurable effect on a metro area’s economic prosperity.  But ODOT and freight industry boosters are keen to argue that freight volumes are increasing in lock step with the economy, and if they’re hindered in any way, our economic ruin awaits us.

The trouble is, as this simple chart shows, that’s not true.   Despite declining freight movement, the Oregon economy has boomed.

The Portland and Oregon economies rebounded sharply after the 2007-2009 recession, and they did so without increasing the number of heavy trucks moving across the Columbia River on the I-5 and I-205 bridges. The truckers and highway types are likely to want to blame the recession, but what’s really striking is that through 2019, I-5 and I-205 truck traffic never recovered to pre-recession levels after a decade of robust economic growth.  Not only that, but truck volumes actually declined from 2013 through 2016, as the economy was growing rapidly.  The key takeaway here is that Oregon’s economy grows just fine, thank you, even with no more trucks crossing the Columbia River.

But this inconvenient truth was treated with dismay and denial, by the Washington Trucking Association’s lobbyist, Sherri Call, nominally a “public representative” on the Community Advisory Group for what the Oregon and Washington Transportation Department’s call the “I-5 Bridge Replacement Project” but which is really meant to be a rubber stamp for a five-mile long, 12-lane wide freeway that just happens to cross a river.  We submitted the ODOT data shown in the chart above for the record at the Community Advisory Group’s March, 24, 2021 meeting.  Call was apoplectic at the idea that anyone could suggest that freight volumes were going down.  Describing a discussion in one of the meeting’s breakout groups she said:

We talked a little bit about the public comment process and I was glad to hear [Project Manager] Greg [Johnson]’s commentary on that, you know, if I share that it kind of got under my skin a little bit, a caller that called in and mentioned the reduction in freight volumes over the years and caused me to go on and do some offline research and that’s actually not the case that has increased and not only that the general traffic has increased as well. And, you know, Greg [Johnson], very eloquently I think put it there basically the people that are calling in are not held to the same standard as, as you folks in the bridge office who are accountable not just to the public but to people internally and people on both sides of the state so that, that is, you know, good for us to be mindful of.

Notably, Call didn’t cite any actual data to prove her point.  But she did confide that she shared her concerns with the project’s manager Greg Johnson, who claimed, according to Call, that “people calling in aren’t held to the same standard” as the project’s promoters in the transportation department.

For the record, it’s important to note that like Call, Johnson didn’t offer any data showing an increase in freight volumes on I-5 across the Columbia River.  Simple asserting an article of faith—and wrapping it in a little sidelong character assassination— was apparently sufficient.  As Upton Sinclair said, it’s difficult to get a person to understand a fact when their salary depends on them not understanding it.

But again, here’s the simple truth:  the volume of freight trucks moving on I-5 and I-205 across the Columbia River is, and remains, lower today than 13 years ago.  And not by a little, by a lot—almost a fifth.  The ODOT data show that there are half a million fewer trucks using the two bridges today than in 2006.

And miraculously, the Oregon economy has not collapsed.  In fact, since 2006, both the Oregon and Portland metro economies have outperformed the US economy, whether measured by employment or gross domestic product.  We’ve managed to grow our economy with less truck movement than we had more than a decade ago.  What that signals is that economic success isn’t simply a product of moving more stuff.  In fact, the most successful economies are the ones which generate new ideas and new services, not simply move more stuff. In the 21st century, success is about doing more with what we have, or even less, and that’s where Oregon has excelled. Our old, resource-based economy could grow only by cutting and shipping more trees or grain; but today, Oregon’s economic growth is driven by a range of knowledge-based industries that expand their output, income, and jobs, without moving ever more trucks.

In the end, though, this argument boils down to simple facts.  If Sheri Call and Gregg Johnson are right, that more and more trucks are needing to move across the Columbia for our economy to succeed, and that widening I-5 at a cost of billions will somehow stimulate more industrial activity, let them present the data, any data, to prove that.  So far they haven’t.  All we have so far is snide claims that they’re somehow held to a higher standard of proof, something they’ve manifestly failed to demonstrate.

 

 

 

Wholly Moses: Pave now, pay later

Oregon legislation goes whole hog on highways

HB 3065 would launch a whole new round of freeway boondoggles, and plunge the state into debt to pay for them

The classic Robert Moses scam:  Drive stakes, sell bonds

The Oregon Legislature is considering a bill, HB 3065, which while it sounds technical and innocuous, is really designed to launch a whole series of new freeway expansion mega-projects in the Portland area.  By authorizing the Oregon Department of Transportation to get started on several of these projects, and to finance them by short-term borrowing and bonds, backed with a legal pledge of both future toll revenues and other state and federal transportation funds, the bill mimics a classic scam developed by America’s original highway builder/power broker, Robert Moses, in the 1930s.

If there is a villain in American urbanism, it is Robert Moses, who for decades, guided public investment in New York, a city and state that to today, still bears the deep imprint of his choices, chief among them, the decision to remake much of the region to facilitate the movement of automobiles. Part of his legacy is the toll bridges and a network of highways that slashed through urban neighborhoods—in his words—like a meat-ax.  But there’s another more subtle, but equally enduring element of the Moses legacy:  a pattern of practice followed to this day, in one form or another, by highway departments around the country.

The latest manifestation of Moses’ malignant legacy is in the form of a bill in the Oregon Legislature.  House Bill 3065 proposes to give the Oregon Department of Transportation power start a series of expensive Portland area highway projects, and issue debt to pay for their (unspecified and unlimited costs), and in the process pledge much of the state’s future transportation revenue, including any monies raised from tolls to pay for these projects.  Along the way, the bill undoes most of the positive attributes of road-pricing authorized by the 2017 Oregon Legislature, which specifically mandated value pricing (aka “congestion pricing’ on Portland area freeways.  As we’ve frequently pointed out at City Observatory, and as born out by the experience of cities around the world and in the US, even a modest price charged for peak hour freeway use would likely resolve the region’s congestion problems.  (That conclusion was also echoed by ODOT’s own consultants three years ago).

What we have in HB 3065, however, is something that is a kind of perpetual motion road-building machine. It authorizes ODOT to issue bonds for a series of megaprojects, and to obligate current and future state revenue, including future toll revenues to pay back those bonds.  It’s a kind of “pave now, pay later” strategy that Moses would embrace, and bears two key hallmarks of Moses’ own work:  driving stakes to force funding commitments to ill-defined, open-ended projects, and using bond covenants to block any legislative oversight or repudiation of his future actions.

Moses locked up all the revenue from publicly financed bridges and tunnels, and at a time when public transit was starved for investment, plowed it all back into a steady stream of new road capacity that demolished neighborhoods, furthered sprawl and increased car dependence.  The Oregon Department of Transportation seems determined to take a page out of the Moses playbook with new amendments.

To see how these two patented Moses gimmicks work, we turn the microphone over to his biographer, Robert Caro.

The Power Broker | Robert Caro

Driving Stakes

The key techniques are two-fold:  First, just getting projects started.  Several of these projects (the I-5 Bridge replacement, and the I-5 Boone Bridge), haven’t even completed their planning, so their full costs are unknown.  The second technique is to issue bonds to pay for the project, secured by toll revenues.

Early on, Moses learned the value of starting construction of a highway—driving stakes in the ground—even if he didn’t have all the financing in place, and regardless of whether he knew (or honestly revealed) the actual total cost of the project.  Just getting something started made it almost impossible for legislators or other officials to deny him whatever resources he needed to finish the project.  Caro writes:

Once you did something physically, it was very hard for even a judge to undo it.  If judges, who had to submit themselves to the decision of the electorate only infrequently, were thus hogtied by the physical beginning of a project, how much more so would be public officials who had to stand for re-election year by year? . . . once you physically began a project, there would always be some way found of obtaining the money to complete it. “Once you sink that first stake,” he would often say, “they’ll never make you pull it up.”

And this tactic turned minimizing or hiding the true cost of a project into an indispensable means of getting things moving:

Misleading and underestimating, in fact, might be the only way to get a project started.  . . . Once they had authorized that small initial expenditure and you had spent it, they would not be able to avoid giving you the rest when you asked for it. . . . Once a Legislature gave you money to start  a project, it would be virtually forced to give you the money to finish it.  The stakes you drove should be thin-pointed—wedge-shaped, in fact on the end.  Once you got the end of the wedge for a project into the public treasury, it would be easy to hammer in the rest.  (Caro at 218-219)

Selling Bonds

One of Moses’ key insights was that municipal revenue bonds worked like an alternative, overriding form of government authority, in his case, overriding future legislative control or second thoughts. The contract between bond issuers (like a state agency) and bond buyers can’t be impaired by future legislative changes. A promise to dedicate certain revenues to an agency in a bond indenture can tie them up for years or decades, or as Moses showed, forever.  Bonds, once issued, become a virtually unbreakable contract.  Once ODOT sells bonds backed by the pledges of toll revenue (and other federal and state transportation revenues) the state is permanently, and preemptively committed to giving it all the toll revenue (and in the case of HB 3065, forfeiting other revenue to make up any shortfall).

Caro explains the original structure Moses crafted when he drafted amendments to New York statutes governing bonds issued by his Triborough Bridge Authority.

Legislation can be amended or repealed.  If legislators were in some future year to come to feel that they had been deceived into granting Robert Moses wider powers than they hand intended—the right to keep tolls on a bridge even after the bridge was paid for, for example—they would simply revoke those powers. But a contract cannot be amended or repealed by anyone except the parties to it.  Its obligations could not be impaired by anyone—not even the governing legislature of a sovereign state.  Section Nine, Paragraphs 2 and 4, Clauses a through i, gave Robert Moses the right to embody in Triborough’s bonds all the powers he had been given in the legislation creating Triborough. Therefore, from the moment the bonds were sold (thereby putting into effect the contract they represented) , the powers he had been given in the legislation could be revoked only by the mutual consent of both Moses and the bondholders.  They could not be revoked by the Authority or by the City whose mere instrumentality he was supposed to be.
(Caro, at 629-630)

The combination of these two strategies—driving stakes and selling bonds—is enough to lock the state into an expensive and environmentally destructive freeway building spree.  And once the bill passes, and the bonds are sold, future legislatures will find themselves as powerless to rein in ODOT as New York was to stop the Moses meat ax from hacking through New York City.

 

How ODOT destroyed Albina, part 3: The Fremont Bridge ramps

ODOT’s Fremont Bridge wiped out multiple blocks of the Albina neighborhood

A freeway you’ve never heard of leveled dozens of blocks in North and Northeast Portland

The stub of a proposed “Prescott Freeway” still scars the neighborhood

This is the third of a three-part series looking at how ODOT freeways wiped out much of the Albina neighborhood in a little over two decades.  Part I showed how the Oregon State Highway Department cut the neighborhood off from the Willamette River in 1951 by the construction of Highway 99W (Interstate Avenue).  Part 2 looked at the construction of Interstate 5 in the early 1960s, which slashed through the middle of Albina.  Today, in Part 3, we show how an unfinished freeway dealt a third major blow to the neighborhood in the early 1970s.

Portland’s unfinished Prescott Freeway

Back in the 1960s, Portland, like many cities had grandiose plans for freeways everywhere.  Portland’s plan, called PVMTS (the Portland Vancouver Metropolitan Transportation Study) called for the city to be carved up by a grid of freeways every few miles.  One of those freeways was the so-called Prescott or Rose City Freeway, running from Swan Island to 82nd Avenue.  Even though it was never completed, this ODOT roadway had (and continues to have) a devastating effect on the Albina neighborhood.

Portland’s planned 1960s freeway grid: The green highways were fortunately never built.

The Prescott Freeway (shown top center in the map above) was designed to connect I-5 and I-205.  the freeway would have cut diagonally from the Fremont Bridge, across North  Portland, and East to (an unbuilt) 52nd Avenue Freeway and then to I-205 near Portland Airport.  As the plan below shows, the segment in North Portland’s Albina neighborhood would have connected to Interstate 5 at a massive cloverleaf intersection at the East end of the Fremont Bridge.

Plans for the Prescott Freeway weren’t abandoned until work on the Fremont Bridge and its approaches were well underway.  The Oregon Department of Transportation built about a third of a mile of expressway at the East end of the bridge, but with no freeway to connect to, the expressway was simply truncated to connect to NE Kerby Street.

 

Because the Prescott Freeway angled diagonally across the neighborhood, it tore apart the pre-existing street grid.  These two overlaid photographs show the neighborhood as it appeared in 1948 (a nearly continuous street grid, filled with homes and businesses) replaced by a newly constructed freeway in 1975 (with much of the housing demolished and the street grid broken).  You can move the slider left and right across the photo to see how the neighborhood looked before and after freeway construction.

The effect of freeway construction wasn’t confined just to the area paved for traffic.  Because the intersection was designed for a full set of ramps connecting all the freeways (I-5, I-405 and Prescott), several blocks on either side of the roadway were acquired or demolished.  Local streets were truncated and North Kerby Avenue was re-routed into a wide new boulevard, ultimately forming the border for the Emanuel Hospital campus, which expanded onto blocks leveled near the freeway.

The following map shows the area altered in the wake of freeway construction around what is now the Kerby Avenue off ramp from the Fremont Bridge.  This 1962 image shows the ongoing construction of I-5 at the left hand side of the photo.  The area taken or demolished at the time of the Fremont bridge ramp construction in the early 1970s is bounded in red.

 

As the photographic evidence makes clear, this part of the Albina neighborhood had a well-connected street grid, and hundreds of intact houses, at least until ODOT’s freeway construction efforts played out.

A Tragedy in 3 Acts:  ODOT highways decimated Albina

Over the course of a little more than two decades, the Oregon Department of Transportation’s highway building wiped out much of Albina. Adding together the land taken by the Highway 99W construction in 1951, the building of I-5 in the early 1960s, and finally the Fremont Bridge and stillborn Prescott Freeway in the 1970s, ODOT’s road-building left a huge scar on the Albina neighborhood.  The following aerial photo shows the neighborhood in as it existing in 1948; the areas bordered in red show blocks where housing and businesses were demolished when each of these three highways were built.

 

The effects weren’t confined to just the buildings knocked down for the roadway itself.  Construction efforts directly acquired and demolished a considerable amount of adjacent property (some of which was never used as freeway plans were abandoned). The wholesale demolition of housing deprived the neighborhood of critical mass to support local businesses and schools, population declined by two-thirds in Albina, and property values plunged.  Much of the neighborhood’s former housing was given over to surface parking lots.  The freeways eviscerated the local street grid, dividing the neighborhood into isolated pockets of remaining housing, in an area increasingly given over to a handful of large institutional uses (an arena, a hospital, a school headquarters), and dominated by large flows of car traffic, mostly from outside the neighborhood.  ODOT’s highways were pivotal in the devastation of Albina neighborhood.

 

Greenwashing auto infrastructure: Natick’s diverging diamond

A proposed interchange in Natick, Mass. is a classic example of greenwashing

The diverging diamond is an idea entirely given over to making things better for cars, and creates a disorienting, circuitous and dangerous world for pedestrians and cyclists.

The intersection of highways 9 and 27 in Natick Massachusetts, just east of Boston, is no urban wonderland.  It’s a classic American highway strip, with a line of car dealers (Dodge, Jeep, Volvo, and others),  the 9/27 mall has a “Stop and Shop” grocery store, but predictably turns its back on the intersection, and the roadways are ringed with acres of surface parking lots.

MassDOT, the state transportation agency is proposing the revamp the intersection, and one of their proposed designs is a “diverging diamond” interchange, that flips traffic to run on the left-hand side of two-way roadways, and creates an intricate weave of ramps that enables most vehicles to proceed through the intersection in almost any direction without stopping. A description of the project presented to the region’s metropolitan planning organization described the project in glowing “multimodal terms”

The modified interchange will include dedicated off-street facilities for pedestrians and cyclists, including a separate bike-ped bridge over Route 9 in between two spans that will support vehicular traffic. The enhanced shared-use facilities will improve connections to Natick Center and the nearby Cochituate Rail Trail.

Here’s the illustration of the diverging diamond proposed by MassDOT.  As you can see, its an intricate basket-weave of ramps, roadways and intersections.

To look at the illustration, you might get the impression that this is a kind of bucolic rural park, riven with pleasant walkways and filled with ambling pedestrians. There’s even a proposed separate pedestrian bridge running East-West across  Route 27.  Indeed, if you look closely at the rendering, it shows dozens and dozens of dots (presumably people walking) on pedestrian paths, sidewalks and crosswalks in and adjacent to the intersection.  If you count all the dots—and we did—the artist is conveying the impression that at any one time there are more than 110 people walking around or through this intersection.

Not only is that an absurdly large number—a quick perusal of Google streetview images shows no pedestrians on the current sidewalks and crosswalks in the area, and there’s precious little reason to believe that many people are walking from the U-haul or the Midas Muffler shop in the Southeast corner of the intersection to the Valvoline Oil Change shop or the Austin Liquor store in the Northeast Corner.

Current conditions at the intersection of Routes 9 & 27 in Natick (Google Streetview)

In truth, this is a profoundly pedestrian hostile design. The diverging diamond interchange flips the direction of traffic, so that cars are running on the left hand side of the roadway, creating deadly confusion for pedestrians used to seeing traffic on the right.  The basket-weave of ramps creates more conflicts for pedestrians, to cross from one side of route 27 to the other (even with the separate pedestrian overpass) requires people walking to negotiate at least six cross walks.  Between a lack of destinations, an environment swarming with cars going in every direction, and a lack of amenities, its hard to imagine anyone walking here.

While the project rendering creates the impression that the area will be chock-a-block with pedestrians, the rendering makes cars virtually disappear.  The illustration shows that once the project is built, routes 9 and 27 will be only lightly trafficked (one wonders why MassDOT is planning to spend anything on an intersection that’s so under-used).  We counted the number of cars, too–each red dot represents a vehicle. The illustration shows just 70 vehicles on routes 9 and 27, and on the myriad weaving ramps and connectors.

Red dots are vehicles, numerals are numbers of “pedestrian” dots in each block

If it’s really the case that about 50 percent more people are walking through this area at any given time than are driving, then maybe MassDOT should consider an entirely different design, one that prioritizes pedestrians.

But we know that all of the fictitious dot-people are just there to green-wash—or perhaps pedestrian-wash—what is in reality an entirely automobile-oriented project.  The illustration is a classic example of the kind of deception practiced by highway departments around the country, generating distorted and misleading renderings to create the illusion that they’re designing “pedestrian friendly infrastructure.

As we’ve discussed before, many of these projects are performative, or are simply automobile infrastructure masquerading as pedestrian infrastructure. Building remedial protections for pedestrians in hostile, vehicle dominated environments, with few or no walkable destinations doesn’t create walkable communities.

And diverging diamond intersections like this one are among the most inimical to pedestrians.  They’re designed with the purpose of speeding traffic and reducing or eliminating the number of times a driver must stop or yield at an intersection.  By creating the expectation that one can go faster, and stop or yield less, the intersections inherently make things more dangerous for pedestrians and for cyclists.

Our colleague Chuck Marohn at Strong Towns took a close look at arguments that the diverging diamond creates a pedestrian friendly setting. In his view, that’s a claim that would only fool a highway engineer. He’s got a video walk-through of a diverging diamond in Missouri that shows how hostile these intersections are to foot-traffic. His conclusion:  the diverging diamond is an “apostasy when it comes to pedestrians and pedestrian traffic.” His judgment is echoed by Schroeder’s study of diverging diamonds reports that vehicles accelerating to freeway speeds are unlikely to yield:

 

Reference:

Bastian Schroeder, Ph.D., P.E. Director of Highway Systems, NC State University, Institute for Transportation Research and Education, Observations of Pedestrian Behavior and Facilities at Diverging Diamond Interchanges. (2015)

Editor’s Note:  A hat tip to Charles Denison IV, @cden4, for tweeting this gem.

An open letter to the Oregon Transportation Commission

For years, the Oregon Department of Transportation has concealed its plans to build a ten lane freeway through Portland’s Rose Quarter

We’re calling on the state to do a full environmental impact statement that assesses the impact of the project they actually intend to build.

An open letter to the Oregon Transportation Commission.

Regular readers of City Observatory will know that we’ve long been casting a close and critical eye on plans to spend $800 million to widen a mile and a half long stretch of interstate freeway in Portland, Oregon.  As we’ve explained, we think this particular freeway fight encapsulates many of the fundamental urban issues of our time:  How we grapple with climate change, re-imagine our cities as more just, inclusive and accessible communities, and how we right the damage done by the urban freeway building of the past.

In its advocacy for this project, the Oregon Department of Transportation has sought to convey the idea that it isn’t really widening the freeway at all.  At worst, its PR campaign claims, they’re adding two “auxiliary” lanes.

But for years, the agency has carefully hidden the true scale of the project.  It’s never publicly released detailed plans showing the roadway’s actual width, despite repeated challenges and questions from the public.

Now new documents show the agency has long been planning a 160-foot wide roadway, more than enough for an eight or ten-lane freeway with full urban shoulders.  It’s apparent now, in retrospect, that agency staff have long known this to be the case, and have willfully concealed this information from the public through a combination of misleading illustrations and outright lies in response to direct questions about the size of the proposed freeway.

This matters because portraying this project as the addition of just two lanes dramatically understates its impact in adding traffic, increasing noise, air pollution and greenhouse gases, and impairing the health and livability of nearby neighborhoods. These are exactly the kinds of impacts that the National Environmental Policy Act (NEPA) requires be revealed before undertaking a major federal project, and rather than honestly disclosing them, this agency has intentionally and aggressively hidden them.

In an open letter to the Oregon Transportation Commission, City Observatory’s Joe Cortright calls for the agency to honestly disclose its plans, and to undertake a full and fair environmental impact statement that shows the traffic, environmental and social effects of the actual 10-lane freeway it is proposing to build.

Cortright_to_OTC_RoseQuarterWidth_17March

Progress Zero: Lofty vision but increasing deaths and injuries

Vision Zero is a popular and widely embraced safety campaign, but the latest data shows Portland is not only not on track, it’s going in the wrong direction when it comes to road safety

Multi-lane, car-dominated urban arterials are the big killers, and instead of fixing them, the Oregon DOT is wasting billions on widening extremely safe freeways

Cheaper gas since 2014 has fueled more driving, more crashes and more deaths.  Vision Zero isn’t working.

Portland’s regional government, Metro, does a thorough job of tracking and compiling road safety measures. Its latest report, including data through the end of calendar years 2019 tracks progress against the region’s adopted “vision zero” goals.

Portland area road deaths:  Rising when they’re supposed to be falling. 

Source: Metro.

Metro calculates progress using the five-year moving average of the number of roadway fatalities in the Metro planning area.  The vision zero plan, incorporated in the 2018 Regional Transportation Plan, calls for that to trend down to zero by 2035, and the dashed red line shows the progress that would be needed to achieve that objective.  But as the 2015-2019 trend (solid black line) shows, the region is moving in the wrong direction at an accelerating pace.  The blue rectangles show the five year moving average (e.g. 2019 is the average of the deaths for 2015 through 2019).  The small blue triangles corresponding to the actual number of road deaths in each year.  In 2019, the five year moving average was 83 deaths, the actual number of deaths was 95, and the Vision Zero plan called for a reduction to 55 deaths.

The tragic topline numbers of fatalities, if anything understate the region’s comprehensive failure to make progress on Vision Zero.  Metro tracks 25 separate measures of system safety, such as fatalities and injuries for different road users in the aggregate, and per capita or per million miles traveled.  Metro’s annual report shows that the region is on-track to make exactly none of these 25 objectives, and has made improvements from 2015 levels on just two (both related to bike safety).

Deadly arterials are the big problem

Periodically, Metro undertakes a “State of Safety” Report that looks at these data in greater detail through the lenses of different geographies and road types.  Their latest report confirmed earlier findings.  Multi-lane arterials are far and away the largest sources of deadly and injurious crashes.  These roadways create inherent conflicts between vehicles, bikes and pedestrians; high speeds and multiple lanes result in more crashes, injuries and deaths. On average, the region’s arterials have five times as many serious crashes per mile traveled as freeways, according to the Metro study, a finding they called “one of the most conclusive relationships in this study.”

This same pattern holds nationally.  A recent national study looked at every major road segment in the nation and identified the 65 of the worst pedestrian crash hot-spots, places that had eight or more pedestrian fatalities in a 1,000 meter road section in an eight year period.  These hot spots, really killing zones,  shared a series of common characteristics:

Nearly all (97%) were multilane roadways, with 70% requiring pedestrians to cross five or more lanes. More than three-quarters had speed limits of 30 mph or higher, and 62% had traffic volumes exceeding 25,000 vehicles per day.

Schneider, R. J., Sanders, R., Proulx, F., & Moayyed, H. (2021). United States fatal pedestrian crash hot spot locations and characteristics. Journal of Transport and Land Use14(1), 1-23. https://doi.org/10.5198/jtlu.2021.1825

Cheap gas = More roadway deaths

Importantly, as we’ve pointed out at City Observatory, the surge in traffic deaths has a lot to do with the big decrease in gas prices in 2014.  Up until 2014, Portland area traffic deaths averaged (over five years) was less than 60 per year.  Since 2015, the five year average has exceeded 60 deaths per year every year, and is increasingly rapidly.

ODOT is squandering billions on freeway widenings that are unrelated to the rising death toll

While the region continues to fail to make progress on reducing crashes and associated deaths and injuries, the Oregon Department of Transportation continues to move ahead with plans to plow billions of dollars into widening area freeways, which are far and away safer than these deadly arterial streets.  ODOT operates many of the region’s most deadly arterial roadways, including Powell Boulevard, Barbur Boulevard, 82nd Avenue, the Tualatin Valley Highway and McLoughlin Boulevard.  ODOT has falsely claimed that the Rose Quarter I-5 freeway which it is widening at a cost of nearly $800 million, has the “highest crash rate in Oregon”.  This stretch of freeway chiefly has minor “fender bender” crashes, and is classified by Metro as a “minor safety project.”

Vision Zero is threatening to become yet another empty marketing campaign; a slogan that simulates concern while allowing business-as-usual—meaning increasing carnage—while providing cover for the highway lobby to squander additional billions of dollars on so-called improvement projects that do little or nothing to reduce growing toll of deaths and injuries on our roads. Metro’s check-in on safety metrics shows our current efforts are failing.  What will the region do to show that its serious about improving safety?

Taking Tubman: ODOT’s plan to build a freeway on school grounds

ODOT’s proposed I-5 Rose Quarter project would turn a school yard into a freeway

The widened I-5 freeway will make already unhealthy air even worse

Pollution from high volume roads has been shown to lower student achievement

ODOT also proposes to build sound walls in Tubman’s school yard

Portland’s Harriet Tubman Middle School is one of the city’s most diverse.  Located in the heart of what historically was the center of the state’s African-American population, more than 60 percent of those enrolled are students of color. The Harriet Tubman School has long been the focal point in the struggle against racist policies.  Community activism helped save the school in the 1980s. There’s another historical legacy nearby as well:  the Interstate 5 Freeway, which, as we’ve chronicled was rammed through the neighborhood in the early 1960s, and which triggered a two-thirds decline in Albina’s population in just two decades.

We’re looking at Tubman Middle School today because the Oregon Department of Transportation is proposing to double-down on the environmental insult done to the area by widening the I-5 freeway, moving it even closer to the school.  As Oregon Public Broadcasting has reported, ODOT wants to move the freeway onto school property, and also build two 1,000-foot long, 22-foot tall noise walls between the school and the expanded freeway.   On Friday April 9, 150 community members rallied at the school to oppose the freeway widening project.  Two of the speakers were 9th grade students Adah Crandall and Malina Yuen, who had attended Tubman.

Harriet Tubman Middle School rally against the Rose Quarter freeway widening project, April 9, 2021.

Moving the freeway closer to the school

When it was built in the early 1960s, the freeway sliced through a portion of the then Eliot School’s grounds, removing a portion of both the school yard and the adjacent Lillis-Albina Park.  Plans for a wider I-5 Rose Quarter Freeway showed it would move the roadway closer to the school.  The group No More Freeways commissioned the following video showing how the freeway would cut away the hillside between the current roadway and the school.  No More Freeways filed suit in federal court to challenge the project’s environmental impact statement on April 2.

ODOT’s $800 million plan to cut away the hillside and move the I-5 freeway closer to Tubman Middle School. (Click for video).

Taking School Property

It hasn’t always been clear that the new freeway would intrude onto school property.  Newly obtained documents, released as part of a public records request, show that ODOT intends to take property now owned by the school district for its expanded freeway.  The following diagram shows the ODOT plans overlaid on a City of Portland map of property lines.  The turquoise lines on the chart correspond to property lines. The red cross-hatched area on the diagram is school property that would be taken for the freeway.

It’s a bit difficult to visualize the proposed taking of school property, so we’ve created a separate map which shows the take as a solid red area.  It’s clear that the new, wider freeway will be built by expanding on Tubman School property.  In a very real sense, we’re taking this land away from neighborhood school kids, and turning its use over to people driving through the area on the Interstate highway.

Estimated area of Portland Public School Property to be taken for freeway expansion (red).

A wider freeway will worsen already unhealthy air at Tubman Middle School

The major environmental issue posed by the proximity of the I-5 freeway to Harriet Tubman Middle School is the air pollution from automobile traffic on the roadway.  In its discussion of the issue, ODOT has been deceptive and inaccurate, both in estimating levels of pollution, and describing the standards of review required by the National Environmental Policy Act (NEPA).

ODOT has dramatically understated the air pollution associated with the freeway widening for several reasons.  First, as we’ve pointed out, it has modeled traffic only for a six-lane freeway, when in fact the 160 foot roadway it is building could accomodate 10 lanes, and vastly more traffic.  Second, its traffic modeling made factually false assumptions about both baseline and no-build levels of traffic on I-5 (inflating them by assuming that the Columbia River Crossing had been built in 2015 and allowing the model to have volumes in excess of capacity in the no-build scenario).  Third, it understated the amount of traffic growth (and pollution) in the build scenario, because its modeling made no allowance for induced demand from added capacity.

In addition, ODOT (and its peer review panel) engaged in a bit of regulatory sleight-of-hand in characterizing the project’s air quality impacts.  First, ODOT has repeatedly claimed that air quality in the area will be better in the future under the build scenario than it is today.  That may be true, but if it is, it is only because of factors entirely external to the project, specifically a changing vehicle mix (i.e. assumptions that fossil fueled vehicles become cleaner due to fuel efficiency requirements, and that a larger fraction of the fleet is electrified).  Whether this is true or not, it is actually irrelevant for purposes of the analysis required under NEPA.  NEPA requires a comparison of environmental effects with and without the project (i.e. “build” vs. “no-build”).  Since we will get vehicle efficiency and electrification regardless of whether this project is built or not, the fact that pollution levels are less than today (or not) are irrelevant.  The real, and unanswered (or incorrectly answered) question is whether air pollution will be higher under the “build” scenario, rather than the “no-build” scenario.  As we enumerated above, because ODOT systematically over-estimated “no-build” traffic, and systematically under-estimated “build” traffic, it got that analysis wrong.  Application of a scientifically calibrated induced travel calculator to the project shows that widening I-5 will generate millions more miles of car travel and thousands of tons more greenhouse gases and pollution each year.

The second bit of sleight of hand is claims by ODOT and its peer review panel that the project is either in compliance with the Clean Air Act or that no analysis of this project is required by the Clean Air Act (CAA).  That’s interesting information, but for the purposes of complying with NEPA, is irrelevant.  NEPA requires a disclosure of a project’s environmental impact, not simply an assurance that the project hasn’t violated some other federal law.  The peer review panel maintains that because Portland is not a “non-attainment” area under CAA, that ODOT is not required to do a “hot spot” analysis of the project.  The panel and ODOT also maintain that because no regulatory standards exist for greenhouse gas emissions, the project need not consider them.  Again, this may be true under the Clean Air Act, but by omitting this information, ODOT is failing to meet its obligations under NEPA to reveal the environmental effects of the measure.  In addition, NEPA requires that a project demonstrate conformity with applicable state and local laws; Oregon statutes call for an 80 percent reduction in greenhouse gas emissions statewide by 2050, and nothing in the project’s environmental assessment indicates how this project would comply; again, estimates using the induced travel calculator indicate the project will generate 8-15,000 additional tons of greenhouse gases annually.

Third, and perhaps most important, none of this analysis indicates whether either current or future levels of air pollution at Tubman School will be healthy or tolerable for Tubman students, staff and the public.  Even at current traffic levels, Tubman School’s air quality is problematic.  An independent assessment advised the school district to restrict outdoor activities by students.  The district spent more than $12 million of its own funds to add air filtration to make air inside the building safe for students to breathe.  Portland School Board member Julia Brim-Edwards raised exactly this issue at the March 22, 2021 meeting of the Executive Steering Committee.  In reply, she was told by members of the peer review panel that they didn’t look at that issue and that they were only tasked with judging compliance.

It is entirely possible for a freeway-widening project not to violate the Clean Air Act but also to worsen air pollution in a way that is deleterious to the health and well-being of people near the freeway.  We have a growing body of scientific evidence that higher levels of traffic near schools tend to impair student performance.  A recent study published by the National Bureau of Economic Research found that after controlling for a variety of other factors, proximity to high volume roadways (like I-5) had a statistically significant negative effect on student performance on standardized assessment tests.  According to ODOT, this stretch of road carries about 120,000 vehicles per day, putting in the highest category on this chart, and the expansion project would allow even more cars in this area.

Jennifer Heissel, Claudia Persico, David Simon,
Does pollution drive achievement? The effect of traffic pollution on academic performance.
NBER Working Paper No. 25489.

A closer freeway means more noise pollution and towering sound walls

But ODOT isn’t just going to take school property for the freeway.  It is also proposing to build two 1,000-foot long, 22-foot tall noise walls between the newly widened roadway and the school.   In the following ODOT diagram—taken from the project’s 2019 environmental assessment—the two walls are shown as “2a” and “2b” and are shaded purple.

 

The exact location of these noise walls doesn’t appear to be final.  The plans are a bit vague as to whether they’ll be built on ODOT property or on the school grounds. In theory, the walls are supposed to attenuate the noise from the closer, wider freeway at the school. In fact, ODOT’s own peer review panel raised concerns about whether the walls would be effective, and recommended that the walls be moved closer to Tubman School.  This would almost certainly mean that the walls would be built on school property—so in addition to having some of its land taken for the roadway, the panel’s recommendation is that a further portion of school property be taken for the noise wall.

From the March 22, 2021, ESC meeting, slide summarizing the Peer Review:

The two twenty foot walls will be roughly as tall as the Tubman building itself (and are nearly twice as tall as the Berlin Wall), while they might reduce sound somewhat, they’ll also turn the school’s grounds into a cramped area dominated by a 1,000 foot long concrete wall, arguably more like a prison yard than a school yard.

Making a mockery of equity and restorative justice

As we’ve made clear at City Observatory, decades of highway building by the Oregon Department of Transportation decimated the Albina neighborhood, leading directly to a decline of two-thirds in the neighborhood’s population (the leading to the Eliot School—original occupant of today’s Tubman building—being merged with the nearby Boise School, because of falling enrollment.  The Oregon Department of Transportation’s I-5 Rose Quarter Freeway widening project benefits car travelers, particularly suburban commuters, while imposing significant financial, health and learning costs on Tubman students.  While the average peak hour single occupancy car commuter from Clark County Washington has a median household income of $82,000; half of Tubman students are on free and reduced price lunches.  In addition, three quarters of those commuters a non-Hispanic whites, while two thirds of the Tubman student body is children of color.  The $800 million project will subsidize these car commuters, and meanwhile Portland Public Schools has had to spend $12 million (that could otherwise be spent improving education) on making the air in the school building fit to breathe.  These stark disparities in who bears the costs and who gets the benefits of this freeway widening make a mockery of its claim to be promoting “restorative justice.”

 

 

Revealed: ODOT’s Secret Plans for a 10-Lane Rose Quarter Freeway

For years, ODOT has been planning to build a 10 lane freeway at the Rose Quarter, not the 6 lanes it has advertised.

Three previously undisclosed files show ODOT is planning for a 160 foot wide roadway at Broadway-Weidler, more than enough for a 10 lane freeway with full urban shoulders.

ODOT has failed to analyze the traffic, environmental and health impacts from an expansion to ten lanes; not disclosing these reasonably foreseeable impacts is a violation of the National Environmental Policy Act (NEPA).

For years, the Oregon Department of Transportation has represented its plans to widen I-5 through the Rose Quarter in Portland as a minor addition of a pair of “auxiliary” lanes to the existing four lanes than carry I-5 through this area.  The agency has repeatedly declined to answer direct questions about the actual physical width of the roadway it is engineering, instead it relies on an incomplete and misleading illustration published in its Environmental Assessment.

Now, No More Freeways, a Portland citizen advocacy group has obtained documents showing that ODOT is actually planning a 160 foot roadway, one more than adequate to accommodate a full ten lane freeway. A story from Willamette Week, “Questions about the footprint of the I-5 Rose Quarter project intensify“, reveals that the Oregon Department of Transportation has long concealed data on the actual width of the freeway it is planning to build through Portland’s Rose Quarter.

ODOT has previously and repeatedly refused to answer basic questions about the width of the freeway.  These documents, which include detailed plans developed by ODOT and its contractors, shows the agency has long known exactly how wide a freeway it is planning, and has designed overpass structures to provide a full 160 feet of buildable space for Interstate 5 roadway at Broadway and Weidler. There’s no doubt, however, that the agency will continue to claim that it’s building a six lane freeway, but no one should believe them: there’s no reason to engineer a massive 160 foot wide roadway for only six lanes, as their own engineering documents, disclosed below show.  Moreover, this kind of deception is an established pattern for ODOT; in 2010 they assured Portland Mayor Sam Adams that they were shrinking the proposed Columbia River Crossing from 12-lanes to 10; instead, they kept the proposed bridge as wide as before and simply deleted all the references to its actual physical width from final environmental documents

Misleading and incomplete information in the Environmental Assessment

The only information provided about the width of the Rose Quarter Freeway was included in a single illustration contained in the project’s 2019 Environmental Assessment.  This illustration, which omits the overall width of the project shows only the dimensions of travel lanes and shoulders.  Together these add up to 126 feet.  That width, as we’ve pointed out at City Observatory, would easily hold an eight-lane freeway.

ODOT’s Misleading EA Illustration:  Six lanes in 126 feet

The following illustrations are taken from the Rose Quarter Environmental Assessment’s Right of Way Report.  We have added the black annotation with arrows indicating the width of the roadway; ODOT’s original illustrations do not provide this information, but we have calculated it from aerial imagery (existing) and by summing the lane and shoulder widths indicated on ODOT illustration (proposed).

What really fits in ODOT’s 160 foot roadway: 10 lanes of freeway 

We’ve drawn a new version of ODOT’s illustration that shows the actual size of the roadway they are proposing to build (on approximately the same scale as ODOT’s illustrations -above).  We’ve also shown how many lanes of traffic this roadway will accommodate.  Our diagram also shows the dimensions of travel lanes, and inside and outside shoulders an allowance for the freeway median and its structures.  This illustration makes it clear that ODOT is building a roadway that will easily accommodate a full ten-lane freeway.

ODOT’s actual freeway cross section at Broadway-Weidler

The undisclosed evidence of the 160 foot roadway.

Throughout the environmental review process and afterwards, the Oregon Department of Transportation has repeatedly declined to disclose the actual width, in feet, of the roadway it is planning to build through the Rose Quarter.

We’ve independently verified ODOT’s decision to engineer a 160-wide roadway based on three different documents.

File 1:  HDR Cover Analysis Memorandum, 2016

In April 2016,  ODOT consultants HDR prepared this memorandum to provide design parameters for the development of a proposal to construct covers over the freeway.  Figure two of this diagram shows the cross section of the freeway as proposed to be built under Broadway and Weidler overpasses.  The measurements on the diagram show two 80 foot spans on either side of a median support structure for a total width of 160 feet.  The detailed roadway section shows six 12 foot travel lanes, four 12 foot shoulders, and two unlabeled, vacant 17′ sections on either side of the outside shoulders.  The measurements on this diagram help explain the 126 foot section shown in ODOT’s illustrations above:  The illustration excludes the two 17 foot sections; adding back these sections brings the right of way to its full 160 foot width (126+34=160).  This detailed plan shows that actual travel lanes (36 feet; three 12 foot lanes on each side of the freeway) utilize less than half of the 80 feet of roadway under the overpass, with more space devoted to shoulders (24 feet in two shoulders) and an unlabeled 17 foot section (41 feet total).

Memo, April 7, 2016. From Andy Johnson (HDR) and Ron Hughes (AECOM), to Mike Mason and John Makler (ODOT), Subject:  Broadway/Weidler Lid Structure Design Concept Feasibility Analysis.

File 2:  CAD-Design Files

No More Freeways obtained a set of ODOT Computer Aided Design (CAD) files showing the plan for the proposed freeway.  We opened this file in a CAD program and used the file’s internal scale tool to measure the total distance of the roadway section as it crossed under the Broadway and Weidler overpasses.  The roadway section is shown in green; the total width of the roadway is 160 feet.

File 3:  Landscape Plans

ODOT hired landscape architect Marianne Zarkin (as a subcontractor to Nelson Nygaard and HDR) to develop a landscape plan for a proposed freeway cover.  Her firm’s website contains a plan of the proposed hardscape and landscaping for the freeway cover, and an included cross-section diagram illustrates the width of the freeway.  The files are un-dated.  While the diagram itself lacks a scale, it does show the size and location of freeway lanes.  Based on the nominal 12′ width of these lanes, the plan shows that the Broadway-Weidler overpass would span a distance of more than 150 feet.

Editor’s Note (February 25, 2021):  After this commentary was originally published, these images were removed from the publicly accessible location on Zarkin’s website. The link that directed to the image shown above now shows as “not found,” as shown below:

City Observatory retains copies downloaded from the website on 24 February 2021.

Why this matters:  More traffic, more pollution, an invalid environmental assessment

ODOT has attempted to minimize the traffic, environmental, health and noise effects of its freeway widening project by representing it as the addition of only two “auxiliary” lanes to the existing four-lane freeway.  These newly revealed plans show that ODOT is actually planning a ten-lane freeway, which would accommodate vastly more traffic, and as a result would have far different and much greater impacts on the area’s livability, safety, and environment.

Constructing additional lanes will induce additional traffic demand, leading to large increases in vehicle miles traveled, air pollution emissions and greenhouse gases.  A ten-lane freeway will, for example, increase the air pollution exposure of students at Harriet Tubman Middle School, which abuts the widened freeway.  The traffic from the ten lane freeway will flood adjacent city streets, making them more hazardous for cyclists and pedestrians.  A higher level of traffic through the Rose Quarter will also make sites on or near the freeway (like the proposed caps) noisier and more polluted than revealed in the Environmental Assessment.

 

Inclusionary Zoning: Portland’s Wile E. Coyote moment has arrived

Portland’s inclusionary zoning requirement is a slow-motion train-wreck; apartment completions are down by two-thirds, and the development pipeline is drying up

This will lead to slower housing supply growth and increasing rents for everyone over the next two to three years

Inclusionary Zoning (IZ) creates perverse incentives to under-utilize available land

In December 2016, Portland’s City Council enacted a strong inclusionary housing requirement.  Henceforth, all new apartment buildings in Portland would have to set-aside a portion of their units for low- and moderate income housing. Unlike other cities that either made compliance voluntary, or largely (or entirely) offset the cost of the added units with density bonuses or subsidies (or other quid pro quo), the Portland ordinance applied to nearly all apartment buildings larger than 20 units. The new requirement didn’t kick in until February 2017, and there was a land rush of developers who filed under the old rules.  That produced a temporary flood of new apartment buildings, that have, over the past four years, mostly been built.

Investment markets work with lags for a variety of reasons.  It takes time to plan, obtain permission for, and actually build new housing, and multi-family housing takes longer than single family housing.  As a result, there’s a multi-year pipeline.  When there are housing shortages, as there were in the early days of the recovery from the Great Recession, supply can’t expand as rapidly as demand, and rents get bid up.  The reverse is also true; a glut of building in good times produces new apartment supply that holds down rents, at least for a while.  That effect has concealed the negative consequences of Portland’s inclusionary zoning policy.

As we observed in May of 2019, the initial implementation of inclusionary zoning resulted in a kind of counter-intuitive acceleration of apartment construction.

. . .  the first two years of inclusionary zoning in Portland have been a game-theory win-win for housing affordability. The threat of tougher future requirements prompted a whole lot of investment to happen much earlier than it otherwise would have, and new developments, added to those already under construction, have helped deliver a lot more new apartments in Portland.

Portland reaches its Wile E. Coyote moment

Back in 2019, we said that Portland’s apartment market was in the midst of the “don’t look down” portion of its Wile E. Coyote experience. The momentum from pre-IZ housing applications filled the construction pipeline, and led to a steady increase in the number of new apartment completions.  And, as we’ve noted, the increase in supply pushed up vacancy rates, and rent increases, which had been in the double digit range in 2015, fell to just 1-2 percent per year, according to Apartment LIst data.

But now, Wile E. Coyote has looked down, and seen nothing holding him up. Data compiled by local economic consulting firm ECONorthwest tracks the number of apartment permits issued in Portland over the past 15 years.  It shows the surge in new apartments in 2017 largely holding up in 2018 and 2019, but then plummeting by roughly two-thirds in 2020, from an average of 4,500 new apartments per year to fewer than 1,500.

The ECONW analysis of the building permit data is echoed by other market analysts.  Noel Johnson’s website, EnvisionPDXtrends also has data on Portland’s development pipeline showing a diminished volume of new apartment construction activity since the inception of the city’s inclusionary housing requirements.

Portland apartment completions (EnvisionPDXtrends)

Similarly Patrick Barry, of the Barry Apartment Report, says that there’s been a sharp fall off in the number of new multi-family building permits applied for in Multnomah County (which contains the City of Portland).  New apartment permits in the county have fallen more than 60 percent in the past year, from  5,165 units in 2019 to 2,043 in 2020.

By all measures, Wile E. Coyote is plummeting to the desert floor.

Lean years ahead for apartment deliveries

What’s even more ominous, though, is a parallel decline in new projects in the application process.  It takes time (two or even three years) for a project to go from permit application to “for lease,” so much of Portland’s apartment supply for 2022 and 2023 (when, by all accounts the economy is expected to be booming again), is essentially already baked into the cake of filed permit applications.  Again, ECONW tracks these new permit applications using city data.  Entry into the pipeline is defined as “set up” activity, when an applicant pre-files or files for a new building permit.  The number of set ups for apartment units peaked in 2016 and 2017 at slightly more than 6,000 new units per year.  Since then, new setups have declined by a third in 2018 and 2019 to about 4,000 per year.  In 2020, new setups were about 2,600, less than half their 2017 level.

Just as the past two to three years have produced a kind of temporary win-win of greater apartment deliveries and slowing rent inflation, the next couple of years seem almost certain to have exactly the opposite:  declining numbers of new apartments, and rising rents.  Already, national forecasters like Zillow are predicting a rapid rebound in demand for urban markets in the post-pandemic period.

Developers will likely wait for the City of Portland to realize the devastating effects of these burdensome IZ requirements and to relax them, or wait for rents to rise enough to support the costs of building new apartments and covering the cost of subsidized units, or simply resign themselves to building smaller, 20-unit buildings, that do much less to expand housing supply and may mean permanently under-utilizing sites that are well-situated to accommodate even greater density.

The Mansard effect

Some of the effects of Portland’s IZ requirements will be quirky and permanent changes to the building stock  For example, one key feature of Portland’s inclusionary zoning rule is that it exempts buildings with 20 or fewer apartments from the inclusionary housing requirement, apparently based on the assumption that such a requirement would make these smaller projects uneconomical.  But what that exemption has done is to prompt many developers to shift to these smaller buildings.  Over the past couple of years, data from the city show that the number of 16-20 unit apartments has (red line) while the number of 21-25 unit buildings (green line) has disappeared.  The number of 16-20 unit buildings in 2020 was 143 percent higher than the 2014-2016 average; the number of 21-25 unit buildings was 100 percent lower (zero) than its 2014-16 average.

For reference, as noted above, total apartment completions declined about 67 percent over this time. The 20-unit and under exemption essentially incentivizes developers to build fewer apartments, and because residential structures tend to be long-lived, once a site is built out at 20 units when it could have been 25 or 30 units, that additional housing will be foreclosed for 50 or 100 years.

Also, developers have noted that the inclusionary provision applies on a building-by-building basis, so by dividing a development project up into a series of 20-unit or smaller buildings, a developer can build many apartments without having to comply with the inclusionary requirement.  That shows up, for example in a recent development in Northwest Portland, where developer Noel Johnson is building eight five-story residential buildings, with a total of 145 units on a small urban infill site.  Again, because each building is 20 or fewer units, the inclusionary requirements don’t apply.

Northbound 30 (Jones Architecture and Waechter Architecture, via Next Portland).

Doing this development as eight different buildings may not the most efficient arrangement, but (to this economist’s eye) the result isn’t unaesthetic.  Johnson points out that dividing the project into multiple buildings assures that each apartment is a corner unit (dual-aspect to you English housey types), which make them more desirable.  It’s an example of how regulation can prompt innovation.

The effect of restrictive land use regulations on urban architectural form has a long history. Mansard windows, now a cherished hallmark of Parisian architecture, soared to popularity as a dodge on city building restrictions.  Buildings in Paris were limited to just 20 meters (about 65 feet), but the rules provided the height would be measured at the building’s cornice.  As a result, a floor or two stepped back behind a steeply angled gambrel roof didn’t count against the height limit.  (Fun fact: back in the days before elevators, apartments on the top floors of buildings commanded rents because tenants had to walk up every flight of stairs; the mansard-enabled apartments essentially functioned as a kind of affordable housing bonus).

Paris builders used Mansard roofs to evade the city’s 20 meter height limit

While the Mansard roofs are endearing, they’re a visible and enduring symbol of the power of regulation to alter the housing market.  And more significant than the changes to the housing that gets built, are the ways that regulations cause new housing not to be built at all can have even greater, but unfortunately largely unseen impacts.  The new apartments that aren’t being built now in Portland will almost certainly lead to higher rents and less affordability in the years ahead—exactly the opposite of the expressed intentions of those who enacted this policy.  It’s the apartments that aren’t being built that are the real legacy of inclusionary zoning.

Editor’s Note:  Thanks to Mike Wilkerson of ECONorthwest and Noel Johnson of EnvisionPDXtrends.com for sharing their tabulations of Portland apartment permit data.  Opinions and analysis presented here solely reflect the views of City Observatory.

The Fundamental, Global Law of Road Congestion

Studies from around the world have validated the existence of induced demand:  each improvement to freeway capacity in urban areas generates more traffic.

The best available science worldwide—in Europe, Japan and North America—shows a “unit-elasticity” of travel with respect to capacity:  A 1 percent expansion of capacity tends to generate 1 percent more vehicle miles traveled.

The fundamental law of road congestion requires us to fix broken traffic models and stop widening highways in a futile effort to reduce congestion.

Call it what you will:  Jevons Paradox, Braess Paradox, Marchetti’s Constant or Downs’ Triple Convergence, the science confirms them all.

Induced demand:  More road capacity produces more traffic

At City Observatory, we’ve related the classic example of North America’s widest freeway, the 23-lane Katy Freeway in Houston.  It’s been successively widened many times, most recently at a cost of $3 billion, and within three years of its expansion, commute times were even longer than before.

But there’s much more than anecdotes like the Katy Freeway to buttress the observation of induced demand.  Sophisticated, in-depth studies of transportation infrastructure and traffic levels, that look at entire nations and measure traffic changes over decades find what is now being called “the fundamental law of road congestion.”  An increase in road capacity directly generates a proportional increase in traffic, with the effect that congestion and travel times quickly return to (or worsen from) pre-expansion levels.  Simply put, expanding road capacity is a futile, and self-defeating effort.  Urban highway expansion is the labor of Sisyphus.

Two recent and definitive studies are Duranton and Turner’s “Fundamental Law of Road Congestion,” and more recently Kent Hymel’s “If you build it they will drive” both of these studies use data for the US and find a unit elasticity of traffic with respect to roadway expansion. Hsu and Zhang found a nearly identical result for roadway expansion projects in Japan.

Europe:  Still more evidence Induced Demand and the fundamental law of road congestion

The latest evidence of the universality of the fundamental law comes from Europe.  Three researchers from the University of Barcelona use two decades of data for hundreds of European cities to replicate the methodology used by Duranton and Turner and Hymel in the U.S.  They find very similar results, confirming the fundamental law of road congestion.  The best estimate is that the elasticity of travel with respect to capacity is essentially unitary:  a one percent increase in highway capacity generates a one percent increase in vehicle travel.

We use data for the 545 largest European cities to estimate the elasticity of a measure of congestion with respect to highway expansion. The results indicate that this elasticity is in the range close to 1. This suggests that expansion of the highway network induced the demand for car travel, and so, on average, the level of congestion remained roughly unchanged in the period 1985–2005. In other words, we show that investments in highways did not effectively relieve traffic congestion.

Congestion in Edinburgh (The Herald)

Tolling is the only way to avoid the induced demand trap

Garcia-Lopez, Pasidis and Viladecans-Marsal examine how the prevalence of tolled roadways affects the induced demand effect.  Cities that toll a higher proportion of their highway system have a much smaller induced demand effect.  Their analysis concludes that traffic is highly elastic in response to capacity expansions in cities with no tolls (each 1 percent in capacity results in a nearly 2 percent incrase in travel; which traffic is highly inelastic in cities with 100 percent tolled highways (a 1 percent increase in capacity results in a 0.3 percent increase int raffic:

(1) highway improvements increase congestion, (2) the effect is smaller in cities with tolls, and (3) the fundamental law is mainly related to cities without tolls or with a low percentage of tolled highways. In particular, and focusing on our preferred specification in column 3 (using a continuous interaction), a 1% increase in lane kilometers increases congestion by 1.9% in cities without tolls and by only 0.3% (=1.9-1.6) in cities with tolls in all their highways (100% share of tolled highways). Some simple computations show that the fundamental law applies to cities with a share of tolled highways below 56%. These results can be regarded as novel evidence in line with recent literature suggesting that the solution to traffic congestion is the adoption of ’congestion’ pricing policies.

Policy implications:  Fix broken traffic models; Stop widening highways

The fundamental law of road congestion is a demonstrated scientific fact, with unambiguous implications for public policy.  First and foremost, the fundamental law signals that the folk wisdom (repeated by highway boosters) that we can somehow “build our way out” of traffic congestion is utterly false.  More roads simply generate more traffic and more sprawl.  Cities and states should stop spending money on road widening projects to reduce congestion.  There’s a second, more subtle and technocratic point as well.  The fiction that more capacity will somehow reduce congestion is actually hard-wired into many of the “four-step” traffic models highway departments use to plan (and justify) highway widening.  The models are calibrated in a way that either ignores or denies the existence of induced demand, usually by simply assuming that the level of traffic demand is fixed, and unaffected by either journey times, delays or congestion.  At best models may crudely re-route traffic in response to congestion, but they fail to alter aggregate trip demand, especially in the long run.  As a result, as Jamey Volker, Susan Handy and Amy Lee show, most existing travel models create the false illusion that a wider road will lead to faster traffic.  Transportation planners–and funding entities, like the Federal Highway Administration—should insist that transportation models be updated to reflect scientific reality. The induced travel calculator shows how this can be done, now.

A truth with many names and discoverers

While this new study from Barcelona, and the similar papers by Duranton & Turner, Hymel, and Hu and Zhang all elaborate in great statistical detail on this finding, the basic concept is well understood, and has been for decades (or longer).  The scientific validation of the phenomenon of induced demand buttresses a series of related explanations:  the Jevons Paradox, the Braess Paradox, and Marchetti’s constant and the Triple Convergence.

Jevons Paradox holds that an increase in efficiency in resource use will generate an increase in resource consumption rather than a decrease.  English economist William Stanley Jevons predicted greater efficiency in using coal would increase its use in 1863.  The efficiency gain seems paradoxical, if one assumes that demand is unaffected by the lower price of a more efficient process, but by making something more efficient, we generate additional demand.

Braess’s Paradox is the application of this general idea specifically to traffic.  German engineer Dietrich Braess postulated exactly this in 1968.

Marchetti’s constant is a corollary to these paradoxes:  It observes that the amount of time human’s devote to daily travel remains constant regardless of improvements in transportation technology. Whether walking, riding horses or streetcars, or driving cars, we devote about an average of an hour a day to travel.  Marchetti’s constant means that we use improvements in transportation to travel further, rather than saving time, a result fully consistent with the fundamental law of road congestion. (The observation has been made independently by many observers including Bertrand Russell as early as 1934.

Down’s Triple Convergence, in his 1992 book Stuck in Traffic, economist Anthony Downs described the existence of a “triple convergence” in which changes in road infrastructure prompted changes in the mode (i.e. transit to car), time, or destination of trips in ways that would lead to congestion reappearing even after an expansion of road capacity.

Miquel-Àngel Garcia-López & Ilias Pasidis & Elisabet Viladecans-Marsal, 2020. “Congestion in highways when tolls and railroads matter: Evidence from European cities,” Working Papers wpdea2011, Department of Applied Economics at Universitat Autonoma of Barcelona.

 

 

Oregon’s I-5 bridge costs just went up $150 million

Buried in an Oregon Department of Transportation presentation earlier this month is an acknowledgement that the I-5 bridge replacement “contribution” from Oregon will be as much as $1 billion—up from a maximum of $850 million just two months earlier.

The I-5 bridge replacement project (formerly known as the Columbia River Crossing) is a proposal for a multi-billion dollar freeway widening and bridge-expansion program between Portland and Vancouver.  The original CRC project died after costing nearly $200 million for staff and consultants in 2014, but has been revived in the past year.

The cost to Oregon of reviving this boondoggle just jumped to $1 billion.

Late last year, we took a close look at the project’s initial financial plans, which show the project could cost as much as $4.8 billion (and considerably more if more realistic inflation estimates are used). We also identified a fundamental math error in the estimation of the project’s financial gap, i.e. the difference between expected costs and potential revenues.  The Oregon and Washington transportation departments—ODOT and WSDOT—understated the maximum size of the funding gap (i.e. what happens in the two state’s realize the low end of expected revenues and incur the high end of expected costs), by more than $1 billion; the total gap the two state’s face is $3.4 billion.  That hole will have to be filled for the project to move forward.  While both states have indicated an interest in reviving the project, neither has committed funds, so a big question now is, how much will they have to contribute.  The Oregon Department of Transportation was telling legislators one thing a couple of months ago, and something a good deal more expensive now.

December 2020:  Oregon contribution $650 to $850 million

ODOT has been including its estimates of Oregon’s share of these costs in its presentations to state legislators.  On December 10, 2021, ODOT testified to the Legislature that Oregon’s contribution to the I-5 bridge project would be $650 million to $850 million.  (The second colored bar on this chart is identified as “Interstate Bridge Replacement Contribution”

February 2021:  Oregon contribution $750 to $850 million
That estimate is no longer operative.  In a presentation to the Legislature on February 4, 2021, the Department included this diagram, showing the state’s contribution to the project was now $750 million to 1 billion.  The chart is almost identical to the chart presented in December, only the price tag of the I-5 bridge project has changed.
In presenting this chart to the Joint Transportation Committee, ODOT’s Brendan Finn made no mention of the increase in Oregon’s expected contribution.  Instead, he drew the committee’s attention to the timetable for implementation of tolling, and didn’t discuss any of the budgetary amounts listed on this chart.  No one on the committee commented on or questioned the budget amounts.
By comparison to financial plans for the original CRC, this represents essentially a doubling of the state contribution to project costs.  The adopted CRC finance plan called for Oregon and Washington to each chip in $450 million, with the balance of the project to be paid for by tolls, federal transportation funds, and hoped for earmarks.  This change in Oregon’s contribution also implies that the total cost of the project has likely increased by between $200 and $300 million since December, as project costs are divided evenly between the two states by agreement of their state transportation commissions.
Steadily escalating project costs, with under-estimates early on, and cost-overruns later are a routine feature of ODOT projects.  Just a year ago, after long telling the Oregon Legislature that the Rose Quarter freeway widening project would cost $450 million, ODOT raised the project’s price tag to as much as $795 million.  Cost-overruns of 200 percent or more have been common on large ODOT highway projects like the Highway 20 Pioneer Mountain-Eddyville segment, the Newberg-Dundee bypass and Portland’s Grand Avenue Viaduct.
While the allocation of much smaller amounts to bicycle, pedestrian and safety projects generates substantial debate and visible resistance from ODOT, the implied decision to increase the allocation for a major freeway-widening project doesn’t even merit a mention to the Legislature, and is accomplished, seemingly, with a deft change to a single powerpoint slide.  This is typical of ODOT budget practices which conveniently find “unanticipated” revenue whenever it’s time to fund a major highway project.
Even though Oregon and Washington have already spent nearly $200 million on the CRC, and committed another $50 million to the planning effort to revive the project, there’s still considerable uncertainty about the project’s actual dimensions, costs, and revenues.  All one can say with any confidence, based on long experience, is that the project’s total price tag is likely to go even higher.

How ODOT destroyed Albina: The I-5 Meat Axe

Interstate 5 “Meat Axe” slashed through the Albina Neighborhood in 1962

This was the second of three acts by ODOT that destroyed housing and isolated Albina

Building the I-5 freeway led to the demolition of housing well-outside the freeway right of way, and flooded the neighborhood with car traffic, ending its residential character and turning into an auto-oriented landscape of parking lots, gas stations and car dealerships.

New York City’s Robert Moses is cast—accurately—as the villain who routinely rammed freeways through city neighborhoods.  Freeways, Moses said “. . . must go right through cities, and not around them, . . . When you’re operating in an overbuilt metropolis you have to hack your way with a meat axe.” (Moses, 1954, quoted in Mohl, 2002).

And Moses, the subject of Robert Caro’s epic biography The Power Broker, actually wielded his meat axe in Portland. The original route of the Interstate 5, which at the time was called the “Eastbank Freeway” was recommended by none other than Moses, who came to the city in 1943 with a group of his “Moses Men,” to recommend a public works program for the region, which recommended the city be carved up by a series of freeways.

As part of its efforts to sell a $800 million I-5 freeway widening project in Portland, ODOT, the Oregon Department of Transportation, has made quite a show of acknowledging its complicity in destroying the Albina neighborhood, which six decades ago, was the segregated home of a plurality of the city’s Black residents.  But its role didn’t start with the construction of I-5 in the early sixties, nor did it end then.  ODOT has made repeatedly hemmed in and destroyed Albina, starting more than seventy years ago.

In part I of this series, we unearthed the largely forgotten—and entirely unacknowledged—role the Oregon Department of Transportation played in triggering the downfall of Portland’s Albina neighborhood in 1951, with its decision to build a mile-long extension of Highway 99W (Interstate Avenue) along the Willamette River. Of all the public “investments” that dismantled Albina, this was the first, but not the last.

1962:  ODOT’s I-5 cuts through Albina

Less than a decade later, the Oregon State Highway Department was back, with another apply another  meat axe to the Albina neighborhood, in the form of the construction of Interstate 5.  It chose a route for the new Interstate 5, largely parallel to and less than a mile east, cutting through the heart of the Albina neighborhood.  And in true 1960’s freeway fashion, the right of way wasn’t just a narrow slice of land, the highway department condemned and demolished businesses and housing for several blocks on either side of the land eventually used for the roadway.

That’s apparent in this 1962 photo showing the project’s construction:

 

In its effort to sell a new $800 million widening of the I-5 freeway through what’s now called the Rose Quarter (to build, as we’ve shown a ten lane freeway), ODOT has made a conspicuous show of apologizing for the original construction of the freeway.  But in our view, the apology has been glossed over ODOT’s role.  Their public relations materials have dramatically understated damage done to the neighborhood.

Here’s a diagram prepared by ODOT consultants, to show how the freeway affected the Albina neighborhoods as it appeared in 1954 (i.e. after ODOT had already built Highway 99W).  ODOT’s historical map shows the homes and businesses as they existed in 1954, and then overlays the I-5 freeway itself as a pair of slender pink lines.  But this significantly understates the scale of the demolition in Albina.  The freeway’s true footprint involved acquiring and demolishing property on both sides of the roadway, as shown in the solid red lines on the right.  Critically, I-5 disconnected much of the Albina street grid.

The area outlined in red on the right hand side of this diagram shows blocks where multiple structures that existed in 1948 had been demolished by 1962, as shown in aerial photographs (see below). This includes both the land occupied by the freeway itself, as well as land cleared as part of the construction process.

The I-5 Freeway Construction Footprint

To get a closer look at this reality, compare these pairs of aerial photographs taken before and after I-5 construction.  The reality is the I-5 freeway leveled whole city blocks on either side of the right of way.  This pair of images allows you to see a “before” and “after” view of the neighborhood.  The before image from 1948 shows the housing and businesses that existed prior to freeway construction; the after shows what was demolished by 1962.  We haven’t been able to obtain data showing a complete list of the properties ODOT acquired and demolished, so we’ve relied on photo interpretation to identify blocks where housing or buildings that existed in 1948 had been demolished in 1962. It may be that some privately owned homes adjacent to the freeway were abandoned by their owners and demolished.

Albina:  From the Steel Bridge to N. Cook Street

Our first pair of aerial photographs shows the entirety of Albina from the Steel Bridge on the South to N. Cook Street (just near the Boise-Eliot School) on the North.  (The original 1948 photograph is truncated on the East)

1948                         ↔                          1962

 

Close Up:  The southern part of Albina

The damage done by the construction of the I-5 freeway is even more apparent when we zoom in to the southern portion of the neighborhood, the area between the Broadway and Steel bridges, and between the Willamette River and Martin Luther King Boulevard (called Union Avenue in 1962).


1948                           ↔                       1962

 

Freeway traffic, not just the roadway, is what doomed Albina

The result of ODOT’s highway construction was to obliterate much of Albina, and to isolate the remaining parts of the neighborhood. Predictably, the neighborhood’s population collapsed between 1950 and 1970, as the area was given over to the automobile. Much of the decline in population in Albina happened years after the freeway was built. The flood of cars undercut neighborhood livability, and population steadily declined in the 60s, 70s and 80s. As people moved away, neighborhood businesses that served local residents, many owned by African-Americans, died. More cars, fewer people, fewer businesses, and a shrunken impoverished neighborhood Building the freeway clearly privileged the interests of those driving through the area, especially suburban commuters, over the people who actually lived here.

 

The construction of I-5 was the second act in a three-part tragedy that doomed the Albina neighborhood.  The first was the construction of Highway 99W in 1951, cutting the neighborhood off from the River.  The I-5 freeway construction in 1962 demolished a huge share of the neighborhoods housing, and irrevocably turned this residential area into an auto-dominated sea of parking lots, roadways, gas stations and car dealerships.  But as we’ll see, there was a third act in the early 1970s that largely completed the encirclement and destruction of the neighborhood by ODOT highways.

It’s sometimes said that what’s past is prologue.  The ODOT public relations campaign for the $800 million Rose Quarter I-5 freeway widening project aims to portray it as a mere minor tweak to the existing roadway, the addition of a couple of inconsequential “auxiliary lanes.” They’re implying that if the footprint of the freeway isn’t expanded much there are no impacts.  Not only is that not true—the hidden plan is to build a 10-lane freeway through—the Rose Quarter, but the real impacts are driven by the flood of cars this would enable.  The real problem with the Rose Quarter freeway is not so much that the project increases the freeway’s footprint—which it does, in ways that ODOT has actively concealed—but rather that by adding additional road capacity, the I-5 Rose Quarter freeway widening project repeats the damage to the neighborhood by injecting even more vehicles into this car-dominated environment.  If we learn anything from history, this is not an error that we should allow to be repeated.

 

How ODOT destroyed Albina: The untold story

I-5 wasn’t the first highway that carved up Portland’s historically black Albina Neighborhood.

Seventy years ago, ODOT spent the equivalent of more than $80 million in today’s dollars to cut the Albina neighborhood off from the Willamette River.

ODOT’s highways destroyed housing and isolated Albina, lead to a two-thirds reduction in population between 1950 and 1970.

Demolishing neighborhoods for state highways is ODOT’s raison d’etre.

As part of its efforts to sell a $800 million I-5 freeway widening project in Portland, ODOT, the Oregon Department of Transportation, has made quite a show of acknowledging its complicity in destroying the Albina neighborhood, which six decades ago, was the segregated home of a plurality of the city’s Black residents.  But its role didn’t start with the construction of I-5 in the early sixties, nor did it end then.  ODOT has made repeatedly hemmed in and destroyed Albina, starting more than seventy years ago.

In 1950, the Oregon State Highway Department built a mile-long extension of Highway 99W that cut Albina off from the Willamette River, and began the process of destroying the housing and businesses that made up the neighborhood.

It’s lost to the living memory of all but a handful of Oregonians, but before 1950, there was no “North Interstate Avenue” between the Steel Bridge and North Tillamook Street (several blocks North of the Broadway Bridge.  In 1950, the Oregon State Highway Department leveled dozens of houses, and removed city streets.  Here’s a grainy contemporaneous news photo from the Oregonian showing the nearly completed Interstate Avenue highway.

(1951, December 23). Oregonian, p. 8

Before the highway was built, this whole area was mostly housing.  In 1950, the Oregon State Highway Department spent the equivalent of $80 million in today’s money to demolish the portion of the Albina neighborhood along the Willamette River to construct a new limited access highway.  The following map shows, bordered in red, the housing that ODOT demolished for Interstate Avenue.  This destruction has been acknowledged only in passing by ODOT in its Rose Quarter freeway widening work.*

 

Albina in 1948 and 1962

To get a sense of how the neighborhood changed, we’ve overlaid the 1948 image of the neighborhood with its 1962 appearance.  The entire area between the Memorial Coliseum and the River was cleared by ODOT for Interstate Avenue.  Albina was now cut off from the river by a state highway.

What ODOT hasn’t acknowledged as part of the Rose Quarter discussion is how its demolition of the neighborhood actually began even earlier, in 1950, when the department  built a highway extension from the Steel Bridge to Interstate Avenue.  Ironically, this highway (US 99W), was an extension of the westside Harbor Drive, which opened in 1943 and famously removed in 1974, and transformed into Portland’s Tom McCall Waterfront Park, replete with verdant lawns and cherry trees. The city’s tonier west-side had its riverbank 99W highway turned into a park; the predominantly Black Albina neighborhood’s segment of the 99W highway remains an auto-dominated arterial to this day.

Conspicuously, the ODOT narratives about its culpability for the destruction of Albina are generally confined to looking just at current right of way of the I-5 freeway.  But in fact, its role in demolishing the Albina neighborhood began more than a decade earlier, with the construction of the Highway 99W/Interstate Avenue extension, and continued for more than a decade later—with the construction of the Fremont Bridge and ramps, which further devastated the Albina community (and which is conveniently left out of ODOT project maps—more about that in an upcoming City Observatory commentary).

But in 1950, to speed the flow of traffic in and through Portland, the State Highway Department (the more accurately named predecessor of today’s ODOT), condemned and demolished a strip of houses along the Willamette River for an  mile-long highway project.

(1951, October 25). Oregonian, p. 40

In 1950, the project cost $3,500,000.  Inflated by the Engineering News Record’s Construction Cost Index, that’s a project that would cost over $80 million today.

Prior to 1950, the dense neighborhood of Albina ran downhill from NE Grand and Union Avenues all the way to the Willamette River.  The neighborhood was a dense network of gridded residential streets, and its two Census Tracts (22 & 23) had more than 14,000 residents. By the time of the 1960 Census, the neighborhood’s population had declined by more than a third, to a little over 9,000.  The construction of Interstate Avenue (Highway 99W), an extension of Harbor Drive was just the first of a series of project that systematically demolished most of the housing in the Albina neighborhood.  In 1960, the city cleared away housing next to Interstate Avenue in part for the new Memorial Coliseum, but mostly to provide for a swath of surface parking lots around the new arena.

 

The result of ODOT’s highway construction was to obliterate much of Albina, and to isolate the remaining parts of the neighborhood. Predictably, the neighborhood’s population collapsed between 1950 and 1970, as the area was given over to the automobile.

 

The real problem with the Rose Quarter freeway is not so much that the project increases the freeway’s footprint—which it does, in ways that ODOT has actively concealed—but rather that by adding additional road capacity, the I-5 Rose Quarter freeway widening project injects even more vehicles into this car-dominated environment.  The local neighborhood association, has come to exactly that conclusion, and they’re correct: The Eliot Neighborhood Association’s land use chair has written:

The only real change the project would make to the surrounding area would be widening the highway, a car-capacity increase that will barely change travel times through the area. It would also serve to put more cars into our local street network, which has led to renderings showing even wider streets through the area than we have now. This would increase road noise and reduce the value of land around the project area.

 

* Editor’s Note:  The originally published version of this story incorrectly claimed that ODOT’s Rose Quarter analysis had not acknowledged the destruction of housing by the construction of Interstate Avenue in the early 1950s.  In fact, one table contained in the project’s environmental justice section concedes that this project demolished at least 80 homes.  Thanks to a regular reader who pointed this out.  City Observatory regrets this error.

 

How freeways kill cities

Freeways slash population in cities, and prompt growth in suburbs

Within city centers, the closer your neighborhood was to the freeway, the more its population declined.

In suburbs, the closer your neighborhood was to the freeway, the more it tended to grow.

It’s been obvious for a long, long time that the automobile is fundamentally corrosive to urban form.  Not only do roads, highways and parking lots devour urban space, they also cause the dispersion of people and activity in ways that make it impossible in many places to live without a car.  Cars, abetted by public policy, have remade cities in their image, and fostered car dependency, effectively acting as a paralytic toxin to urban living.

Even before we had good data, this was manifest to thoughtful observers, such as James Marston Fitch who wrote in The New York Times in 1960:

The automobile has not merely taken over the street, it has dissolved the living tissue of the city.  Its appetite for space is absolutely insatiable; moving and parked, it devours urban land, leaving buildings as mere islands of habitable space in a sea of dangerous and ugly traffic.

Now, six decades later, we can look at the historic record to measure just how true this observation was. Federal Reserve economists Jeffrey Brinkman and Jeffrey Lin have looked at the historical relationship between neighborhood growth and proximity to freeways.  Their data shows freeways have decimated city neighborhoods and propelled suburban population growth.

In the center of the region, more freeways are associated with population decline, and the closer you are to the freeway, the more population tends to decline.

Freeways are toxic to urban neighborhoods and a tonic to suburban sprawl

On the suburban fringe, freeways both tend to stimulate more population growth, and the most positive effect on growth tends to be quite close to the freeway, and the growth inducing effect attenuates the further one gets from the freeway.  The devastation wrought by urban freeways isn’t limited just to knocking down houses, but extends to undermining the vitality of the surviving portion of a neighborhood.  With fewer people and more traffic, a neighborhood loses its critical mass needed to support businesses and civic institutions, triggering a downward spiral.  As images like these, from Portland’s Albina neighborhood make clear, freeways have devastating effects.

The Moses meat-ax slices hacks through North Portland (1962).

The authors’ key findings which aggregate data from 64 metropolitan areas for the period from 1950 to 2010 show the typical effects.

The authors have summarized their findings in one particularly dense graphic, which we present below.  It deserves a bit of explanation.  (For clarity, we’ve annotated it slightly with lines and shading to highlight key issues.)

First, the chart breaks all the neighborhoods (census tracts) in a metropolitan area into four columns, arrayed left to right, based on how close they are to the city center.  The closest-in urban tracts are shown on the left (above the legend “city center”) and in increasing order of distance from the city center are three other groups, 2.5 to 5 miles away, 5 to 10 miles away, and 10 to 50 miles away.  The vertical axis on this chart corresponds to the (log) growth rate of the population of neighborhoods between 1950 and 2010.  We’ve drawn a line at zero (no growth), and shaded negative values (population decline) as yellow.

Finally, each column is subdivided based on the distance from a tract to the nearest local freeway.  So, for example, the leftmost column shows neighborhoods within 2.5 miles of the city center, and the line within the column illustrates the change in population in those neighborhoods based on their distance to the nearest freeway.

Looking at that left-most column, we see that there’s nearly 100 percent decline in population in close-in neighborhoods a mile or less from the nearest freeway.  In an urban setting freeways largely wipe out population.  Population declines are less severe, but still substantial 2 and 3 miles away.  The period 1950 to 2010 was one of urban decline, but as this chart shows, the urban neighborhoods that fared the best were the ones that were furthest from freeways.

Overall, the further you move from the center of the region, the more the effect of freeway proximity becomes positive for population growth.  Population growth is negative close to city centers, split between declining and increasing 2.5 to five miles away, and increasing fastest in tracts 5-10 and 10 or more miles from the city center.

The inflection point where freeways go from being a detriment to a stimulus to population growth seems to be about five miles from the city center.  Beyond 5 miles from the city center, the localized effect of freeways shifts from highly negative, to positive.  From 5-10 miles, the highest levels of growth are neighborhoods closest to freeways.  For those areas beyond ten miles, growth peaks about 2-3 miles from the nearest freeway, but declines sharply thereafter.  Freeway access is a tonic to growth in suburbs and the metro periphery.

Brinkman and Lin’s work adds additional depth to research done on this subject by other economists. Professor Nathan Baum-Snow found that each additional radial freeway constructed through a city reduced the city’s population by 18 percent.  In urban settings, freeways are toxic to population growth.  Neighborhoods close to freeways in and near city centers suffer the most severe population decline.

Jeffrey Brinkman and Jeffrey Lin, “Freeway Revolts!,” Federal Reserve Bank of Philadelphia Research Department Working Paper 19-29, July 2019, https://doi.org/10.21799/frbp.wp.2019.29

 

 

Covid Migration: Temporary, young, economically insecure

There’s relatively little migration in the wake of Covid-19

Most Covid-related migration is temporary, involves moving in with friends or relatives, and not leaving a metro area

It’s not professionals fleeing cities:  Covid-related movers tend to be young (many are students), and are prompted by economic distress

From the earliest days of the pandemic, pundits predicted that the Covid-19 virus would prompt rapid and permanent migration away from cities.  First, it was the concern that city residents were somehow more susceptible to the Coronavirus—prompted by a weak correlation driven mainly by high infection rates in New York in the early days of the pandemic, but which completely reversed as rural areas now have higher rates of cases and deaths.  Then the argument morphed:  Now, thanks to Zoom and other web-technology, we can all work at home, so there’s no reason for companies to pay for expensive offices (or for workers to live in expensive cities).  We think the pessimism about cities is massively overstated for at least seven reasons.   In both cases, this theory has been fueled by anecdotes of highly paid professional workers de-camping from big cities to smaller cities, or rural ones.

But these anecdotes seriously mis-represent the nature and scale of migration.  First, as we’ve noted earlier, migrants in these anecdotes don’t usually leave metro areas at all (many examples are people who were already considering a move to nearby suburbs), but even when they do leave a New York or a San Francisco, its for another, albeit smaller, tech center, like Seattle.

Many of these journalistic anecdotes suffer from what our friend Jarrett Walker calls “elite projection“:  a tendency to view things from the perspective of the richest and most advantaged, rather from the average person. Early stories profiled Upper Eastside neighborhoods deserted by their residents harboring in the Hamptons or Adirondacks.  That genre continues in the vaccine era, as well.  Consider this gem from Bloomberg:

A new study sheds some light on who’s actually moving in the post-Covid world and why.  It’s not so much mid-career professionals moving permanently; it’s really much more economically distressed younger adults, moving in (or back in) with family and friends; movers also disproportionately people of color.

Pew Research, which bills its work as that of a “fact tank” provides some insights into the actual extent, character and motivations of the Covid-induced movement.  Their recent survey of 15,000 adults nationally included a battery of migration-related questions.  They’ve shared some of the top-line results from the survey.  Here are the highlights:

Not many people moved due to Covid. All in all about five percent of all Americans report having moved due to the Covid-19 pandemic and its related fallout. (Even that number is smaller than it seems, because it includes temporary moves.  Of the 5 percent who reported moving due to concerns about Covid (or related economic problems), about one in six said their move was so permanent that they “bought or rented a new home on a long-term basis.”  (Unhelpfully, the Pew migration question asks whether people moved either temporarily or permanently, but fails to define either of these terms. If a family spent a week or a weekend away from New York at the height of the pandemic outbreak in March, would the answer be yes?)

Economic reasons seem to dominate moves. Particularly in the past few months, it has been the economic hardship, rather than concern about the Covid-19 virus itself that seems to be prompting moves.  Financial reasons, including job loss account for a third of all moves.  The more common story is not moving to work remotely, but moving because one has no work.

The demographics: Young, Hispanic, and lower income. Overall, about 5 percent of Americans report either a temporary or permanent move, but 18-29 year olds are twice as likely as other Americans to report a move, Hispanics are nearly twice as likely.  How many of the press accounts of Covid migration speak to twenty-something people of color moving back in with their family, because they’ve lost their job?  That’s a far more representative migrant than the older, wealthier, mid-career professional who can afford to buy a new home and who’s so secure in their work that they can work at a distance.

 

Students and School Figure prominently.  A significant amount of recorded moves seem to be students unable to attend school. That’s implied by the demographic data (those 18-29 are twice as likely to move), by the places they move to (a plurality of movers go to live with Mom, Dad or another relative), and by the direct answer to the question about why people move: About one in seven who reported moving due to Covid through November said it was because their college campus or school had closed.

Few people cite more space or remote work as a motivation.  While the narrative about taking advantage of remote work to get a bigger home, and “zoom it in” figures prominently in journalistic accounts, it’s rare according to the survey.  Pew reports:

. . . people who moved due to the virus said the main reason was that they needed more space (2%) or were able to work remotely (1%).

None of these survey results seem to provide strong evidence for a re-ordering of America’s locational preferences in the wake of Covid. The fact that most moves are among young adults with lower incomes, suggests it’s not the higher income, mid- to late-career professionals abandoning cities for suburbs or rural areas that accounts for much of the reported migration.  Whether in the midst of the pandemic’s rising caseload, or waiting impatiently for the vaccine roll-out, it’s easy to make overblown predictions about urban flight.  Cities have long weathered such crises, and rebounded in their wake.  They will again.

Albina Then and Now

Albina then and now

Basically, Albina was wiped out by
Interstate Ave 99E (ODOT)   1951
Memorial Coliseum (City) 1958
I-5 1962
Emmanuel Hospital (PDC)  1970s
Blanchard Center (PPS)  1980
Convention Center 1990 (expanded 2003)
Moda Center/Rose Garden 1995
But ODOT’s two highways cut all this off from the rest of the city.  99E/Interstate cut the
neighborhood off from the River; I-5 cut if off from the rest of N/NE Portland.

Overview of Albina, 1948 versus Today

 

Memorial Coliseum 1975

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I-5


 

The I-5 Freeway’s Construction Footprint

 

Fremont Bridge Ramps

 

How housing segregation reduces Black wealth

Black-owned homes are valued at a discount to all housing, but the disparity is worst in highly segregated metro areas

There’s a strong correlation between metropolitan segregation and black-white housing wealth disparities

More progress in racial integration is likely a key to reducing Black-white wealth disparities

It’s long been known that US housing markets and policy have combined to produce a huge disparity in housing wealth between Black and white families in the US.  Andre Perry and his colleagues at the Brookings Institution, for example, have estimated that owner-occupied homes in Black neighborhoods are undervalued by $48,000 per home on average.

The racial/ethnic home value gap

A new report from real estate analytics firm Zillow drills down on the racial/ethnic home value disparity.  Using a combination of home sales data and information from the American Community Survey, they estimate the average home value in different markets around the country for several racial/ethnic groups—Blacks, Latinx, Asian, non-Hispanic whites, indigenous people and Pacific Islanders.  Home values are systematically lower for most people of color, with Black households experiencing the biggest gap, with their homes being valued about 15 percent lower than all homes in the US.

The Zillow data also track the trends in the racial home value disparity over time.  The collapse of the housing bubble caused racial disparities to widen, but they’ve narrowed a bit in recent years.  Zillow explains:

Prior to the Great Recession, the gap between Black-owned home values and all home values was about 15% — if the typical U.S. home at the time was worth $1, the typical black-owned home was worth $0.85 — according to a Zillow analysis of home values in communities with different racial compositions. The gap grew to 20% by March 2014 after years of job losses and elevated foreclosures. Similarly, the ratio of Latinx home values to all home values hit bottom in May 2012 at 86% — down from 88% before the housing bubble. It has taken almost a decade for the typical home owned by a Black or Latinx homeowner to roughly get back to where it was relative to the standard U.S. home in 2007.

While the overall average is a 15 percent devaluation for Black-owned homes relative to all homes, there are wide variations among metropolitan areas.  As the Zillow report notes, the disparity is as little as 1 percent in some metropolitan areas (Riverside, CA) and more than 40 percent in others (Birmingham, Buffalo and Detroit).  It’s apparent that the pattern of variation across metro areas isn’t random.  Cities in the West, as a rule have lower disparities than cities in the Northeast and Midwest.

How segregation drives the housing value gap

One thing we know about race and US cities is that there is a wide variation in the level of housing segregation.  As we noted last year, some US cities have much lower levels of white/non-white segregation than others.  We investigate the relationship between segregation and racial home value disparities by looking at data for large US metro areas.  We draw on metropolitan level estimates of the black-white dissimilarity index computed by the Brookings Institution, and compare them to Zillow’s estimate of the gap between Black-owned home values and all home values for those same metro areas.

This chart shows the level of Black-white segregation on the horizontal axis (with higher levels of segregation corresponding to higher values on the index) and the relative value of Black-owned homes to all homes on the vertical axis (all the values are negative because in every market, Black-owned homes are valued at a discount to all homes.  These data show a clear negative relationship between segregation and the home value gap:  The more segregated a metro area, the greater the gap in housing values.  Black households who own homes in more segregated metro areas suffer a greater housing value gap that Black households who live in less segregated metro areas.

These data show that there are seven metro areas—Birmingham, Buffalo, Chicago, Cleveland, Detroit, Milwaukie and St. Louis— that have particularly high levels of segregation and a particularly wide racial housing value gap.  These metros are clustered in the lower right of our diagram; all have Black-white segregation index values of 70 or more, and in every metro, Black-owned housing is valued at at least an 37 percent discount to all housing.

At the other end of the spectrum, metro areas with low levels of segregation have very small racial housing value gaps.  San Antonio, Riverside, Portland, and Virginia Beach have Black/white segregation scores of less than 51 and have racial housing gaps that are less than 6 percent.

But even excluding these extreme cases, there’s still a noticeable relationship between the racial housing value gap and segregation in less segregated metro areas:  In general, the less segregated a metro area, the small the racial housing value gap.

We are rightly concerned about the wealth gap between people of color and the nation’s non-HIspanic white population.  We have a system where homeownership is a large fraction of wealth for most households, especially those who do not have high incomes.  These data suggest that making continuing progress in promoting neighborhood integration is key to ameliorating the housing value gaps that underlie the observed wealth gap.

America’s K-shaped housing market

Home prices are soaring, rents are falling

The disparate impact of the recession on high income and low income households in driving the housing market in two directions at once.

Job losses have been concentrated among the lowest earning workers, who are disproportionately renters. Meanwhile high earning workers have seen no net job losses, and they are disproportionately homeowners and home buyers.

The K-Shaped Recession

When the Covid-19 virus struck in early 2020, it abruptly plunged the nation into the sharpest economic downturn we’ve ever recorded.  But job losses weren’t even distributed across the economy.  Some workers, especially those in front-line service work, were much more likely to lose their jobs (and to be unable to work-at-home), while others have pretty much kept their jobs, despite disruptions to commuting and work routines.  What we’ve observed is what many are calling a “K-shaped recession” with devastating economic consequences for some, and no change in earnings for others.

Harvard economist Raj Chetty and his team at Opportunity Insights have assembled an impressive array of high-frequency big data from private sources to provide an unusually detailed look at the change in the economy in the wake of the Covid-19 outbreak.  Their website, Track the Recovery, has a compelling chart that shows the very different employment trajectories of highly paid and low paid workers.  They’ve broken up all US workers by earnings quartile; this chart shows the employment levels for those in the lowest quartile (annual earnings under $27,000 annually) and in the highest quartile (over $60,0000).  While employment for high wage workers is actually higher now than before the pandemic, employment for low wage workers has plummeted by 21 percent since January of 2020.  The recession is essentially over for high paid workers, but lingers on for those with the lowest earnings.

A principal reason for this divergence has to do with the differential effects of lockdowns and business closures on different occupations.  High paid professional workers have vastly more opportunities to continue their jobs by working at home.  Service and retail workers at essential businesses, meanwhile can’t “zoom it in” and have experienced much greater layoffs and reductions in hours of work.

The K-Shaped Housing Market

The K-shaped trajectory of the overall economy is mirrored in the housing market.  Home prices and rents have moved in opposite directions since the start of the pandemic.  Home price inflation (shown in blue), according to the Case-Shiller National Home price index had been in the 4-5 percent range prior to the pandemic, have essentially doubled to more than nine percent.  At the same time, the BLS estimates of rents (shown in red) paid by US city residents have fallen from a little under 4 percent year over year, to barely two percent.  (The yellow shaded area is the recession)

Other sources of housing market data confirm the K-shaped divergence in rents and housing prices since the advent of the Covid-19 pandemic and recession.  Here we’ve mapped monthly year-over-year changes in housing prices (from Zillow) and apartment rents (from Apartment List.com).  These data show that the rate of home price inflation, which had been ebbing for the previous two years, has essentially doubled from 4 percent annually to 8 percent annually since the onset of the pandemic.  Meanwhile rent inflation, which had been steady at about slightly over 2 percent per year has turned negative, and is declining at about a 1.5 percent annual rate.

Low wage workers are renters; high wage workers are homeowners (and home buyers).

There’s an obvious explanation for the different trajectories of house prices and rents:  Low income workers rent; high income workers own and buy homes. High income households have been barely grazed by the Covid-19 recession.  In fact, the combination of low interest rates and enforced savings (because many kinds of consumption spending, including dining, entertainment, travel and even much retail have been constrained by lockdowns), mean higher income households may find housing a much more attractive spending item.  If you can’t go out to dinner, or take a vacation, you have more money to spend on a new home.  Low wage workers are in the opposite situation.  Low wage workers have borne the brunt of the recession; they are also much more likely to be renters than higher income households.

According to data from the 2019 American Community Survey—via the indispensable IPUMS* website—among working age Americans, households with incomes of less than $40,000 a year (roughly the bottom quartile of households in this category), about 66 percent are renters.  In contrast, of households in the top quartile (with incomes of more than $100,000 per year), 78 percent are homeowners.  The decline in employment during this recession has been concentrated on those households most likely to rent.  Meanwhile, employment among those households most likely to be homeowners has actually increased.  This divergence clearly explains why rents are falling, while home prices are rising:  In the aggregate, renters are bearing the brunt of job losses while homeowners have largely avoided a decline in employment.

The distinctly K-shaped nature of the recession, and of the housing market, are closely related. This sharp and sudden divergence in the fates of high income and low income households, and rental and for-sale housing markets is clearly a product of the Covid-19 recession. Over the course of the coming year, as the Covid-19 vaccine rolls out, and the economy recovers, it seems likely that we’ll see employment gains among low income workers.  As their economic condition improves, that’s likely to diminish substantially the downward pressures we’ve seen on rents for the past year.

* – Steven Ruggles, Sarah Flood, Ronald Goeken, Josiah Grover, Erin Meyer, Jose Pacas and Matthew Sobek. IPUMS USA: Version 10.0 [dataset]. Minneapolis, MN: IPUMS, 2021. https://doi.org/10.18128/D010.V10.0.

Calculating induced demand at the Rose Quarter

Widening I-5 at the  Rose Quarter in Portland will produce an addition 17.4 to 34.8 million miles of vehicle travel and 7.8 to 15.5 thousand tons of greenhouse gases per year.

These estimates come from a customized calibration of the induced travel calculator to the Portland Metropolitan Area.

It’s scientifically proven that increasing freeway capacity in dense urban environments stimulates additional car travel.  The explanation is simple:

Attempts to address traffic congestion commonly rely on increasing roadway capacity, e.g. by building new roadways or adding lanes to existing facilities. But studies examining that approach indicate it is only a temporary fix. They consistently show that adding roadway capacity in congested areas actually increases network-wide vehicle miles traveled (VMT) by a nearly equivalent proportion within a few years, reducing or negating the initial congestion relief. That increase in VMT is called “induced travel.”

The phenomenon of induced demand is so well-demonstrated that its known as the “fundamental law” of road congestion.  As the experience with Houston’s 23-lane Katy Freeway shows, no matter how many lanes you add to a freeway in a dense urban setting, added capacity simply prompts more driving

Transportation experts at the University of California Davis National Center for Sustainable Transportation have developed an induced travel calculator, based on the best available scientific information on the effect of added freeway capacity on vehicle travel.  The developers of the calculator—Jamey Volker, Amy Lee and Susan Handy—have published a peer-reviewed article describing the empirical estimates in the literature showing the connection between capacity and VMT.  In their journal article, the authors find that highway departments usually only address induced demand in response to public comments, rarely apply state-of-the-art modeling to their analysis, and routinely underestimate the effects of induced demand, by as much as an order of magnitude.

The purpose of this model is to provide an independent, scientifically sound means of measuring the environmental effects of major transportation projects.

Induced Demand Calculator; Results shown for Sacramento-Davis metropolitan area.

In addition, because greenhouse gases are directly related to vehicle miles of travel—each thousand mile traveled by a typical automobile produces about .466 tons of greenhouse gases—the calculator also can be used to show the climate change impact of freeway expansion projects.

A Portland-calibrated version of the Induced Travel Calculator

After consulting with the authors of California calculator, we calibrated the calculator for use in the Portland metropolitan area.  The key variables in the calculator include the number of interstate freeway lane miles in the urbanized portion of the metropolitan area, and the number of vehicle miles of travel on those roadways.  The literature on induced demand shows that vehicle travel exhibits and unit elasticity with respect to roadway capacity:  a one percent increase in road capacity tends to result in a one percent increase in vehicle miles traveled.

Using data from the US Department of Transportation (vehicles miles traveled) and from the Oregon and Washington departments of transportation (interstate freeway lane miles) inside urbanized areas, we created a Portland-metro specific version of the California calculator.

We computed the induced travel impact of two possible scenarios for the proposed I-5 Rose Quarter Freeway widening project using Portland-calibrated version of the calculator.  Option one was expanding the current 1.5 mile stretch of freeway from 4 lanes to 6 (which is how the Oregon Department of Transportation describes the project, although they misleadingly call the added lanes “auxiliary” lanes.  Option two is expanding the same stretch of freeway to eight lanes, which is what would easily fit in the 126 foot wide right of way that Oregon DOT proposes to construct.

The calculator suggests that the expansion to six lanes would add about 17.4 million vehicle miles per year to travel in the Portland metropolitan area, and that the expansion to eight lanes would add 34.8 million vehicle miles of travel.

These additional vehicle miles of travel have many negative effects.  As “fundamental law” suggests, they’ll entirely offset congestion reduction benefits of freeway widening.  In addition, there will be an increase in air pollution proportionate to the increase in vehicle travel.  Additional VMT translates directly into increased greenhouse gas emissions, at nearly a half ton of greenhouse gases per thousand miles, this means that the widened freeway can be expected to increase greenhouse gas pollution in Portland by between 7.7 and 15.5 thousand tons per year.

The Volker/Lee/Handy model represents the latest, independent, state of the art method for estimating greenhouse gases associated with freeway expansion projects.  This, and not the self-serving and incorrect estimates generated by the Oregon Department of Transportation should be used to define the environmental impacts of this project.

References

Jamey M. B. Volker, Amy E. Lee, Susan Handy, “Induced Vehicle Travel in the Environmental Review Process,” Transportation Research Record, Volume: 2674 issue: 7, (July, 2020) pages 468-479

The author wants to thank  Doctor Volker for reviewing the methodology and data used in the Portland version of the calculator.  Any errors are solely the responsibility of City Observatory.

 

Congestion Pricing: ODOT is disobeying an order from Governor Brown

More than a year ago, Oregon Governor Kate Brown directed ODOT to “include a full review of  congestion pricing” before deciding whether or not to do a full environmental impact statement for the proposed I-5 Rose Quarter Freeway widening project.

ODOT simply ignored the Governor’s request, and instead is delaying its congestion pricing efforts, and proceeding full speed ahead with the Rose Quarter with no Environmental Impact Statement that would include pricing.

ODOT has produced no analysis of the effects of pricing as part of its Rose Quarter environmental review, and has said “congestion pricing was not considered” 

Congestion pricing could dramatically reduce congestion at the Rose Quarter according to ODOT’s own studies (which are not included in the project’s Environmental Assessment).  Pricing is exactly the kind of effective and also reasonably foreseeable alternative that the National Environmental Policy Act (NEPA) requires be considered.  ODOT has both disobeyed the Governor and violated NEPA.

A little background.  In 2017, the Oregon Legislature passed HB 2017, transportation finance legislation that raised the state gas tax and vehicle licensing fees, and which authorized several freeway widening projects, and also directed the Oregon Department of Transportation to implement congestion pricing on Portland area freeways. Pricing the I-5 freeway, rather than expanding it, could reduce or eliminate traffic congestion faster, and at far lower cost. According to the National Environmental Policy Act, that’s exactly the kind of alternative that ODOT and the Federal Highway Administration are required to evaluate and discuss in the environmental review of a project.  And ODOT’s own studies have shown that pricing the I-5 freeway would dramatically reduce traffic congestion.  But there’s simply no mention of congestion pricing in the Rose Quarter freeway widening Environmental Assessment.

Governor Brown:  “Include a full review of congestion pricing.”

In December, 2019, Oregon Governor Kate Brown instructed the Oregon Department of Transportation to include  review of congestion pricing, in its decision on how to proceed with an environmental review of the proposed $800 million I-5 Rose Quarter Freeway widening project. In her December 16, 2019 letter to the Oregon Transportation Commission, Governor Kate Brown asked for a “full review of congestion pricing, and how its implementation would impact the Rose Quarter,” before the OTC made a decision on the environmental review path.

The environmental review path, in this case, consisted of a decision as to whether to move forward with a full Environmental Impact Statement, one which included a full and complete assessment of the effects of road pricing.  Despite the Governor’s explicit instruction to undertake a “full review of congestion pricing”  ODOT simply ignored this instruction, and said it would not undertake an Environmental Impact Statement at all.

ODOT:  We’re not going to look at congestion pricing in the Rose Quarter environmental review

When ODOT and the Federal Highway Administration released their FONSI—Finding of No Significant Environmental Impact—they simply ignored the Governor’s instruction, and claimed that they weren’t required by federal law to consider tolling (untrue), and that they would look at the effects of tolling later—only after they move forward with the Rose Quarter project.

On October 30, 2020, ten months after the Governor’s letter, having neither published nor provided any additional information about the impacts of congestion pricing, ODOT and its federal Partners adopted a “Finding of No Significant Impact” (FONSI).  In the FONSI, ODOT made it clear that it would not look at the impacts of tolling on the Rose Quarter, saying that this congestion would be the subject of “further study” with analysis “expected by the end of 2022.”

Tolling: Tolling (also referred to as congestion pricing or value pricing) on I-5 was not considered to be reasonably foreseeable at the time the Environmental Assessment was being prepared because tolling on I-5 was not included in the financially constrained project list in the 2014 Regional Transportation Plan (RTP), nor is it currently included in the financially constrained project list in the 2018 RTP. Congestion pricing on I-5 is currently (as of October 2020) being studied by ODOT, consistent with Legislative direction to the OTC in House Bill 2017 “to pursue and implement tolling on I-5 and I-205 in the Portland metropolitan region to help manage traffic congestion.” During the 2018 ODOT Value Pricing Feasibility Analysis, the I-5 corridor segment between SW Multnomah and N Going was identified for further study. Managing traffic congestion and mobility through tolling on this I-5 segment could provide one of the largest benefits to the most regional travelers and the state-wide economy. Further, additional traffic and mobility analysis will be initiated that will help identify where tolling would begin and end on I-5 and the type of tolling to be utilized; this planning work and technical analysis is expected to be completed by the end of 2022. The results of this analysis will inform the starting timeframe and alternatives for a formal environmental review process.

[Emphasis added.]

In short, instead of including congestion pricing in the Rose Quarter environmental review, ODOT simply announced that it would proceed with the Rose Quarter as is, and address road pricing only after the Rose Quarter project moves forward.

ODOT is delaying action on congestion pricing until after Rose Quarter starts construction

ODOT is dragging its feet on a 2017 legislative mandate to implement congestion pricing. And contrary to the claims made in the FONSI, ODOT has no plans to even finish planning for congestion pricing before 2023.  Just weeks after issuing the FONSI, on December 10, 2020, ODOT Director Kris Strickler and ODOT Manger Brendan Finn presented a schedule to the Oregon Legislature showing that the congestion pricing planning phase would continue until the end of 2023.  The schedule also shows that the agency plans to commence construction on the I-5 Rose Quarter project a year before it even completes planning for congestion pricing in the Portland Area.

Under this schedule, Rose Quarter construction (the diagonally shaded section) would start as early as 2022, while the planning for congestion pricing would not be complete until 2024.  There’s also an ambiguous “design/build, test and implement” phase that lasts until 2027.

Congestion pricing is highly foreseeable:  It’s mandated by law

Notice that ODOT’s explanation simply ignored the Governor’s explicit instruction, and instead makes the assertion that due to federal regulations, ODOT need not address pricing, because somehow it was not “reasonably foreseeable.”  That of course, is nonsense:  congestion pricing has been mandated by state law since 2017, well before the completion of ODOT’s Environmental Assessment.  It’s simply false to claim that it isn’t foreseeable. Whether or not a project is listed in the Regional Transportation Plan or not does not determine whether it is “reasonably foreseeable.”  The legal standard under NEPA is much broader as the Environmental Protection Agency says:

The critical question is “What future actions are reasonably foreseeable?”. Court decisions on this topic have generally concluded that reasonably foreseeable future actions need to be considered even if they are not specific proposals. The criterion for excluding future actions is whether they are “speculative.” The NEPA document should include discussion of future actions to be taken by the action agency.

ODOT has been directed by law to adopted congestion pricing; it is not in any sense speculative, and it is plainly a “future action to be taken by the action agency” and needs to be addressed in the environmental review, whether or not its part of the Regional Transportation Plan.

ODOT’s other studies show pricing would reduce congestion at the Rose Quarter

The studies undertaken by the Oregon Department of Transportation conclude that congestion pricing could measurably reduce traffic congestion on I-5. The analysis concludes that the project would reduce congestion and improve travel time reliability on I-5.  It would save travel time for trucks and buses.  It enables higher speeds and greater throughput on the freeway–because it eliminates the hyper-congestion that occurs when roads are unpriced. Here’s an excerpt from page 17, of the report.  We highlighted in bold the most salient bits of the analysis:

Overall, Concept 2 – Priced Roadway, will reduce congestion for all travelers on the priced facility. This will produce overall improvement in travel time reliability and efficiency for all users of I-5 and I-205.  [Concept 2 is] Likely to provide the highest level of congestion relief of the initial pricing concepts examined. [It] Controls demand on all lanes and, therefore, allows the highest level of traffic management to maintain both relatively high speeds and relatively high throughput on both I-5 and I-205. Vehicles 10,000 pounds and more (such as many freight trucks and transit vehicles) would benefit from travel time improvements on the managed facilities.  Pricing recovers lost functional capacity due to hyper-congestion, providing greater carrying volume with pricing than without. This means that diversion impacts may be minimal, but still warrant consideration and study.

This concept is relatively inexpensive to implement, and significantly less expensive than concepts that include substantial physical improvements to the pavement and bridge infrastructure.

Oregon Department of Transportation,, (2018). Portland Metro Area Value Pricing Feasibility Analysis Final Round 1 Concept Evaluation and Recommendations Technical Memorandum #3, 2018. [Emphasis added].

Why parking should pay its way instead of getting a free ride

Hartford Connecticut considers a pioneering move to make parking pay its way

A higher parking tax works much like a “lite” version of land value taxation (LVT)

Surface parking lots are highly subsidized polluters

As Donald Shoup lays out in exhaustive detail in his 733-page masterpiece, The High Cost of Free Parking, the subsidies we provide for car storage have shredded the fabric of America’s urban areas.  By giving over so much land to cars, we weaken and undermine the things that make cities work well:  the opportunities for easy interaction. There’s  evidence that the effects of parking are causal:  from 1960 onward, an increase in parking provision from 0.1 to 0.5 parking space per person was associated with an increase in automobile mode share of roughly 30 percentage points according to a study of nine cities.  We have too much parking for many reasons:  we’ve subsidized highway construction and suburban homes, we’ve mandated parking for most new residential and commercial buildings, and we’ve decimated transit systems. But a key contributor to overparking is the strong financial incentives built into tax systems.

Parking is subsidized by our current tax system

In effect, our system of local property taxation plays a key role in subsidizing parking and car use.  In nearly all US cities, the property tax is assessed equally on the value of both land and improvements, so if one improves a piece of property (by constructing or enlarging a building), the owner’s property taxes go up.  The contrary is also true, if a property is unimproved, or just covered in gravel or asphalt, the owner typically pays lower taxes based only on the value of the bare land.  In cities with high vacancy rates, the property tax actually rewards landowners who demolish buildings. The perverse incentives created by raising taxes on those who improve their land with active uses like offices, stores and homes, led Henry George in the 19th Century to propose a “single” tax on land, what is now generally called the “land value tax” (LVT).

The Land Value Tax fixes the anti-development incentives built in to the property tax:  Constructing a new building doesn’t cause the owners taxes to rise.  And those who own valuable property can’t avoid or minimize taxes by leaving it fallow; if a downtown block is zoned for office use, for example, it pays high taxes even if it’s a vacant lot.  But despite its appeal, there’s been little enthusiasm for land value taxes in the US; only one large city, Pittsburgh has seriously flirted with the idea, for a time taxing property more heavily than improvements.  But, elsewhere, it’s been a non-starter.

Higher fees for parking as a “lite” land value tax

The City Council of Hartford Connecticut is considering an expanded fee on private commercial parking lots and structures that mimics some of the important features of a land value tax:  Call it LVT-lite.  In Hartford, as in many US cities, much of the downtown area is given over to car parking, and surface parking lots pay lower rates than those lots with improvements.  The low rate of taxation on parking lots lowers the holding costs for landowners, and makes parking a more profitable use than developing these lots for other more intensive uses. One way to change that dynamic is to raise taxes or fees on parking, which is exactly what the city’s proposed ordinance would do.

As University of Connecticut engineering professor Norman Garrick has shown, Hartford’s downtown has been hollowed out by the construction of parking.  As Garrick explains:

Since 1960, the number of parking spaces in downtown Hartford increased by more that 300 percent — from 15,000 to 46,000 spaces. This change has had a profound and devastating effect on the structure and function of the city (see accompanying maps) as one historic building after another was demolished.

Not surprisingly, the proliferation of freeways and surface parking lots (shown in red) has coincided with a dramatic decline in the city’s population.

The Hartford ordinance would establish a sliding scale of fees for parking lots and structures based on the number of parking spaces.  The fee would start in 2022, and be phased in over a period of years.  When fully implemented, for large parking lots, the incremental fee works out to $125 per parking space per year, which is about 25 cents per working day per parking space.  Hartford’s proposed policy would but in place incentives to better use urban space, and to discourage excessive car travel.  As the Parking Reform Network‘s Tony Jordan told us:

. . . parking stall fees are good policy because they would contribute simultaneously to several important policy objectives. Parking stall fees, particularly surface stalls, will encourage better uses of urban space, which I think is a big consideration in Hartford. Per stall fees internalize more of the costs of someone’s decision to drive and raise revenue that can and should be used to encourage and subsidize other modes. The environmental and traffic benefits from mode shift are obvious.

Is taxing parking fair?  A parable of parking subsidies:  Stormwater

We’ll bet you didn’t know that Hartford had a multi-billion dollar subway system.

Superficially, it might seem like raising fees on parking is somehow “picking on” cars and car ownership.  There should be a rational basis for any tax, and when it comes to parking there are very good reasons to raise fees and taxes to offset for the car subsidies built into our current systems of public finance.

It’s worth stepping back a bit and considering just how much subsidy is extended to parking, and to car travel in general.  Some of the biggest subsidies are not on anyone’s radar.  Take for example the cost of dealing with stormwater.  Hartford, like many US cities, has an antiquated system of combined storm and sanitary sewers; when there’s a heavy rainfall, water from streets, roofs and—wait for it—parking lots, flows into storm sewers, overwhelms the sanitary sewer system, and produces combined discharges of untreated sewage and stormwater into, in Hartford’s case, the Connecticut River.  The city is under a court order to fix the system, and is in the process of spending $2.5 billion to solve the problem.  The solution includes building a four-mile long 18-foot diameter tunnel—essentially a subway for stormwater.  (That’s not hyperbole; single-track subway tunnels, like San Francisco’s central subway are 20 feet in diameter).

Hartford’s 4-mile cross-town subway—for stormwater

To pay for the project, Hartford and surrounding cities are charging their residents a “Clean Water Project Charge” on their water bills.  Local residents actually pay more for the stormwater system, per gallon, than they pay for their domestic water ($4.05 per hundred cubic feet for domestic water consumed, and are charged $4.10 per hundred feet of water used to pay for stormwater).  But keep in mind that the stormwater doesn’t result from domestic water use—it results from runoff from roofs, roads and parking lots.

While some cities charge based on the amount of a user’s “impervious surfaces,” Hartford does not.  As a result, neither cars, nor parking lots pay anything toward the stormwater problems they cause.  And it is these impervious surfaces, like parking lots that contribute enormously to the quantity and (bad) quality of stormwater.  Since they are large and impervious, they create the huge peak flows that cause overflows. And it’s also the case that cars—via pollution from tires, leaking engine oil and gasoline, and brake linings—produce some of the most toxic elements in stormwater runoff.

Charging residential water users, but not car users and parking lots is, in turn, an equity issue:  a Hartford resident who may not even own a car (per the US Census, roughly 23 percent of Hartford residents live in households that don’t own a car) has to pay for this problem through their water bill.  Meanwhile, a suburban commuter from outside the water district area would pay nothing toward Hartford’s stormwater system.  In short, their are good reasons of efficiency and fairness for asking parking lot owners to pay more toward dealing with the costs they impose.

For cities, imposing fees on parking makes fiscal and land use sense.  For too long, we’ve subsidized the assault on urban living by cars, and nothing has been more detrimental to cities than dedicating scarce and valuable urban land to car storage. Many of these subsidies are buried—literally and figuratively—in the way we pay for urban infrastructure, like stormwater runoff.  In Hartford, and many other cities, we have the perverse situation where carless households are taxed to cleanup runoff from streets and parking lots, while road users pay nothing for the damages they cause. Ultimately, an full-fledged land value tax would help correct the perverse incentives in the current property tax, but until then, charging a higher fees for parking lots is more efficient and fairer.

Editor’s note:  This post has been revised to correct a math error in the originally published version.  We originally reported the fee worked out to approximately 50 cents per day when fully implemented, but failed to note that the fee is biennial, rather than annual. The fee at the margin, when fully implemented in several years, will be 25 cents per working day.  The fee is phased in over a period of years.

2021: Time to get serious about climate

Our new year’s resolution should be to take climate action seriously.

Time is running out to actually do something that will reduce the steady growth of carbon dioxide in our atmosphere, which is triggering irreversible damage to ecosystems around the planet.  There are four big takeaways you should know about climate:

1. We’re falling further and further behind our stated goals of reducing greenhouse gas emissions, principally because since 2014 we’re driving more.  That’s true in cities around the country, including our own home Portland.  Transportation agencies are particularly complicit in this failure, and are chiefly rationalizing “pollution as usual” in the guise of climate strategy.

2. Pledges alone won’t accomplish anything. Saying you support the Paris Accords and plan to emit much less greenhouse gas a two or three decades from now doesn’t count for anything without immediate actions now to lower emissions.

3. Cities are central to the climate solution: We need to build more great walkable city neighborhoods, and more housing in the great walkable neighborhoods we already have.

4. Pricing carbon (as well as pricing driving and parking) can go a long way to creating the incentives and leveraging the financial resources and human ingenuity needed to save the planet.

We’ve been making this case for some time now at City Observatory; today’s commentary pulls together all the various threads of our argument. Our focus is on our home, Portland and Oregon, which are self-styled climate leaders, but the lessons apply with equal or greater force to cities and states across the nation.

1.  We’re not making progress.

In Portland, per capita greenhouse gas emissions from transportation have increased more than 14 percent since 2013, by about 1,000 pounds per person. Total greenhouse gas emissions from transportation have increased by about 1.6 million tons per year over that time.

Portland had pledged to start a new climate conversation in the fall—there’s no information about it yet on the Bureau of Planning and Sustainability’s website, although Portland is advancing a proposal for a $25 per ton fee on greenhouse gas emissions for some polluters, a topic we’ll address in an upcoming commentary.

Highway builders rationalizing pollution as usual

Our institutions are still mired in the thinking of the 1950s, when they need to be helping using build the low-carbon world of 2050.  Major agencies, like state highway departments are engaged in systematic denial about their role in causing and helping to solve climate change.  For example, the Oregon Department of Transportation is proposing billions of dollars to widen freeways, which will inevitably lead to additional greenhouse gas emissions.  The Oregon Department of Transportation lied about the likely greenhouse gas emission reductions from so-called “operational treatments”—things like ramp-metering and variable speed signs, which led to the defeat of a 2015 highway spending bill. The Oregon Department of Transportation’s newly appointed director Kris Strickler, repeated the discredited myth that wider freeways could reduce greenhouse gases by lowering idling in traffic in his confirmation hearing.  The Oregon Transportation Commission has steadfastly refused to apply any kind of climate test to freeway widening projects, simply choosing to ignore the statutory state mandate to reduce greenhouse gases.

Regional planning organizations, which should have the cross-cutting perspective needed to think about climate, land use, housing and transportation, have been no better.  Metro, Portland’s regional government has adopted what amounts to a “Why Bother” climate strategy. Metro is nominally in favor of climate action, but has meekly rationalized business-as-usual/pollution-as-usual.  The technocratic details of its so-called “Climate Smart Strategy” call for only a trivial reduction in driving.

The regional government’s real priorities were apparent in its 2020 transportation bond measure  would have spent $5 billion mostly in highway corridors and reduced greenhouse gases by less than 0.5 percent.  Mercifully, voters overwhelmingly rejected the measure in the November 2020 ballot.  Along the way Metro even fielded propaganda-like surveys that intimated that building more roadway capacity to reduce congestion would lower greenhouse gas emissions.

2. Pledges won’t accomplish anything by themselves.

Groundhog’s Day:  In Oregon, every year, we observe Groundhog’s day, with a vengeance when it comes to climate.  As we’ve chronicled at City Observatory we’ve been stuck in the same tragic loop, in 2016, 2017, 2018, 2019, and 2020. We piously declare our fealty to the Paris climate accords and reaffirm our commitment to reduce greenhouse gases by 80 percent or more by some year ending in zero two or three decades hence, but when you look at the accounting our carbon emissions have actually increased.

We’ll always have Paris:  Mayors are always happy to make climate pledges, but then little comes of them. Up and down the West Coast, where climate awareness and activism are widespread, there’s widespread failure to make meaningful progress in reducing greenhouse gases.  In the four jurisdictions that make up “Ecotopia”—California, Oregon, Washington, and British Columbia—local inventories show carbon emissions increasing.

It’s clear that our previous efforts haven’t been enough.  The City of Portland wrote a “final report” on the implementation of its 2015 Climate Action Plan, patting itself on the back for ticking off items on a checklist, but papering over the inconvenient fact that greenhouse gas emissions have increased rather than decreasing as called for in the plan.  As we said last fall, the City awarded itself a “participation trophy” for climate action, that’s not acceptable if we’re serious about climate change.

What we observe locally in Portland with projects like the proposed $800 million I-5 Rose Quarter freeway widening project are symptomatic of a larger national campaign by the highway lobby to deny, ignore and aggravate climate change.  Most conspicuous of these efforts is a call from the Transportation Research Board—itself an arm of the National Academy of Sciences—to spend additional hundreds of billions of dollars subsidizing literally trillions of miles of additional driving. Even climate mayors are little better.  As Curbed’s Alissa Walker points out:

. . .  members of the Climate Mayors coalition — including many who sit on a new task force to “serve as critical voices within the network” — are actively widening highways, often right through the center of their cities, despite the fact that climate goals they set do not allow for any increases in driving.

For example, Phoenix has developed its own climate action plan, and has a goal of reducing carbon emissions, but will spend several hundred million dollars, chiefly from sales taxes, to widen local freeways and subsidize more driving and sprawl.

Highway builders cloak their environmental destruction with cute, greenwashed logos and slogans, and misleading renderings that make giant freeways look like pedestrian dominated parks.

“Planning and environmental linkages” — a cover for greenwashing more and wider roadways.

In place of tangible reductions in travel or greenhouse gases, we get self-awarded participation trophies for trivial or even counterproductive measures.  Washington, DC, proclaimed itself a “LEED Platinum City” but the practical details of what that means for greenhouse gas emissions is murky at best, and the region is embarked on a massive freeway expansion strategy. Instead of tangible efforts to reduce greenhouse gases by reducing vehicle miles of travel, we get token efforts to the paint fossil fuel infrastructure in a coat of greenwash.  A classic example is a LEED certified free parking structure at the national renewable energy lab in Golden Colorado subsidizes auto travel to its suburban campus.

3. Cities are the solution.

Ultimately, cities are the cornerstone of a livable, sustainable climate strategy.  As the Coalition for and Urban Transition has written, we should be striving to build places that are compact, clean and connected.

 

Our friend Ethan Seltzer wrote in 2019 that it was time to get real about climate change, and to focus on building our cities to reduce the need to travel so much:

. . . transportation emissions are going to frustrate the best of our climate goals unless we find ways to diminish our dependence on auto travel for every minute aspect of our modern lives.

Building more housing in dense, transit-served locations is an essential strategy for fighting climate change. Efforts like California State Senator Scott Weiner’s SB 827 (legalizing apartments near transit) and Oregon’s missing middle housing (legalizing four-plex buildings in single family zones) promote affordability, and lessen vehicle travel.  Paris Mayor Anne Hidalgo has popularized the idea of a 15-minute city, and building more neighborhoods where most or all of our daily needs can be met with a 15 minute trip on foot or by bike would dramatically reduce carbon emissions. Building more housing would also help lower rents and reduce displacement.

4.  Pricing Carbon

A carbon tax is needed, not as a panacea but to realign everyone’s information and incentives in ways that support greenhouse gas reduction. Including the price of carbon in every good and service sends powerful and universal signals to consumers and producers about which things are green and which aren’t. Economists and Scientists Agree:  To save the planet, we’ve got to price carbon. The convoluted and widely gamed claims of environmental responsibility from everything from “LEED” building standards to “food-miles,” impose an impossible cognitive burden on consumers.  We lack the technical knowledge and processing power and time to calculate the carbon footprint of every decision, but we can quickly and easily assimilate information from different prices.  Perhaps most importantly, carbon pricing sends critical signals to inventors and investors about where they ought to be spending their intellectual and financial capital.  A carbon tax makes every dirty project and technology less profitable, and every clean project and alternative more feasible, sooner.  We can and should engage in efforts to regulate the worst and most dispensable forms of greenhouse gases (like chlorofluorocarbons), and we should educate people as much as possible about how to live in harmony with the planet, but these efforts will work best in a world where the damage carbon does is reflected back to everyone in the prices and profits they see from their actions.

A two cent solution for climate change.  The cost of pricing carbon isn’t out of line with fees that we regularly and willingly pay to limit environmental damage. Portland charges nearly $100 a ton for bulk garbage disposal, but you can use the region’s airshed to dispose of as much carbon as you want for free.

Pricing roadways, as well as a carbon emissions, can reduce road congestion. The high price of cheap gasoline.  We know that incentives work, when the price of oil and gasoline fell in global markets in 2014, driving, which had been declining, suddenly shot up.

Pricing carbon and roads, with the proceeds either used to facilitate low-carbon living or rebated to lower income households can also make our cities and our transportation systems more just.  There’s nothing equitable about an automobile dependent transportation system:  it makes those without cars or who can’t (or shouldn’t) drive second class citizensRoad pricing is inherently fair, because it makes buses run faster.

We’ve dawdled and dissembled on climate for too long.  We need to acknowledge that our current efforts aren’t working, and focus on the growing greenhouse gases from automobile emissions.  Pledges, good intentions and greenwashing are diverting us from the need to change our cities to allow low carbon living. Building more places where common destinations are close at hand, and building more housing in the high demand locations that already have these amenities is good for the climate, housing affordability and equity. Putting a price on carbon assigns responsibility, aligns incentives and provides the resources to make steady progress to reducing greenhouse gases.

2020: The Year Observed

2020 was a trying, tumultuous and often tragic year.  Here are some of the top commentaries that marked the year.

Like so many, we were preoccupied with global crisis of the Covid-19 pandemic.  Early on there was a chorus of voices blaming cities and urban density for the rapid spread of the pandemic.  We pushed back with a string of analyses debunking the density theory. We also punctured a related series of anecdote driven claims of urban flight.  As it turns out some of the densest places in the country (and the world) weathered the pandemic well, while the worst outbreaks were in rural areas. Initially, poverty and housing overcrowding, not urban density were the strongest correlates of viral spread.

In the summer and fall, as the pandemic worsened dramatically in its second and third waves and was far worse in rural areas than in the nation’s large cities.  With the pandemic becoming universal, low density and sparse population were no protection from the virus.

In June, we released our latest CityReport:  Youth Movement, chronicling the latest data on the movement of well-educated young adults to the close-in urban neighborhoods of the nation’s largest cities.  We found that the number of 25- to 34-year-olds with a four-year or higher degree living within three miles of downtown increased in every one of the 52 largest metro areas, and moreover that the rate of increase accelerated in 80 percent of these large metro areas since 2010.

The death of George Floyd at the hands of Minneapolis police provoked a wave of national revulsion and a reawakening of the unfinished conversation about racial justice.  We refreshed our analysis of racial segregation in the nation’s large cities, ranking the most and least segregated cities. We’ve also explored the ways that our current transportation system discriminates against the poor and people of color.  There’s much work to be done to make our cities more just and inclusive.

Even though the pandemic and associated lockdowns and recession produced a decline in vehicle miles traveled (and even a reduction in greenhouse gas emissions), they didn’t make our roads safer, as speeding worsened, and traffic fatalities increased. We challenged the notion that spending money for elaborate and circuitous pedestrian overpasses actually promotes walkability, arguing that these structures are really to benefit cars, not people walking.

This “pedestrian” overpass is really car infrastructure.

In our home base, Portland, the proposed I-5 Rose Quarter Freeway widening project has ballooned in cost—as we predicted—to nearly $800 million.  We identified more than two dozen reasons, from safety, to climate, to racial justice, to bike and pedestrian access, to better air quality, as to why this expensive folly shouldn’t go forward. And 2020 marked a dramatic shift in the project’s political fortunes, as key community groups and city leaders came out in opposition.

Portland’s freeway battle is just a microcosm of an emerging national battle over whether we’ll continue the expansion of urban freeways, which will generate even more travel, sprawl, and greenhouse gas emissions. Tragically, groups like the Transportation Research Board are implicitly endorsing climate arson with reports that call for vastly expanded subsidies to road construction and driving, something we called out in our essay “highway to hell.”

Cities will have important decisions to make in the coming year about whether to continue down the path to a worsened climate crisis, or whether to begin reducing car dependence.  We and others are optimistic that building great urban spaces is a foundation of a sustainable and just solution to the climate crisis.

Housing affordability continues to be a widespread concern. Unlike previous recessions, the Covid recession has been marked by a robust housing market with rising home prices. Concerns about affordability in some city neighborhoods inevitably touch on gentrification.  Two of our most-read commentaries in 2020 summarized the latest research findings on neighborhood change (long time residents benefit from gentrification), and constructing more new housing tends to hold down rents. While gentrification generates popular press, its still the case that concentrated poverty and neighborhood decline are vastly more widespread and destructive.

Looking forward to 2021, many people are worrying about the fate of cities.  Despite the pandemic, we’re optimistic that the same powerful forces that have driven city dynamism and success will re-assert themselves.  In a long essay looking forward, we argued that seven “C’s” are likely to buttress urbanism in the years ahead.  We think people are too quick to assume that the work-around of work-at-home will displace the power of face-to-face interaction, which happens best and most in cities.  In particular, we argue that the competitive nature of the workplace and labor markets advantage those who are in the office, and disadvantage those who are at a distance, a fact that’s not apparent when everyone is forced to work from home, but which will change as people are able again to return to the office. And beyond that, going to work is far from the only (or even the most important) reason people choose to live in cities.  The personal, social, and consumption opportunities of cities continue to be a powerful draw, especially for well-educated young adults.  We suspect that as the pandemic fades a large, pent-up demand for close personal interaction will powerfully stimulate urban economies.  Once again, we’ll want to be in the “room where it happened” and won’t settle for being digital bystanders on Zoom.

As Covid-19 vaccines become more widely available in the new year, we’ll be looking for a resurgence of more normal activities, including city living. We’ll be watching in 2021.  Happy New Year!

 

 

Portland carbon tax should apply to all big polluters

By all means, Portland should adopt its proposed healthy climate fee, a $25 ton carbon tax

But make sure it applies to the biggest and fastest growing sources of greenhouse gases in the region

The healthy climate fee should apply to freeways and air travel, not just 30 firms who produce 5 percent of regional GHG emissions.

The City of Portland has proposed a new “healthy climate fee” on a range of businesses and organizations that it says discharge more than 150 tons of greenhouse gases in the city.  Like most economists, we’re all on board with the idea of pricing carbon.  The reason we have a climate crisis is we allow everyone to use the common atmosphere as a dump for carbon without compensating society for the damage done.  Economists are unanimous that pricing carbon is essential to avoiding climate catastrophe:  it simultaneously discourages bad behavior, rewards low polluting activities, creates incentives for cleaner investments and spurs the innovation needed to make all this happen.  And, as we’ve pointed out the price needed to trigger these changes is modest—less on a per pound basis than the fee we charge for grocery bags or the deposits charged on soda cans or indeed for disposing of solid waste.

The only objection we have to this proposed fee is that it doesn’t go nearly far enough.  It exempts more than 95 percent of all the region’s carbon pollution.  The proposed climate fee is targeted at those who own or operate facilities that generate 2,500 tons of carbon dioxide or more per year.

The city’s inventory lists 35 such facilities, including steel mills, bakeries, oil storage depots and other manufacturing facilities, but also universities, hospitals, and a wastewater treatment plant.  The city has used air pollution permit data to estimate the tax liability of the firms it thinks will be subject to the tax.  Collectively, it expects them to pay “healthy climate fees” of about $9.2 million annually on 370,000 tons of carbon emissions.

That seems like an impressive number, but in fact only amounts to about 5 percent of the city’s greenhouse gas emissions.  But by its own reckoning, the City of Portland (Multnomah County) produces more than 7.7 million  tons of greenhouse gases per year.  So this measure taxes small  but visible fraction the areas total emissions.  What it leaves out is revealing.

As we’ve pointed out repeatedly at City Observatory, Portland is failing in its effort to meet its climate goals because of the big increase in carbon emissions associated with transportation, particularly from increased driving.  Transportation accounts for 41 percent of county greenhouse gas emissions, and unlike emissions from residential, commercial and industrial uses, which are all significantly lower than in 1990, these emissions are increasing.  In essence, the key reason the city is failing achieve the goals laid out in its 2015 climate plan is due to more transportation emissions. The bulk of the increase is due to increased driving since 2014, when gas prices declined, so this is actually an area where some economic incentives might do some good.

If the region is going to take climate change seriously, it should be focused not just on a handful of institutions that account for less than a twentieth of greenhouse gases, and instead focus on the biggest and fastest growing part of the climate problem.  If we think about transportation as a system, it’s clear that the region’s transportation facilities, its freeways and airports are a major source of greenhouse gas emissions.  If we’re going to charge such a fee at all, we ought to  include in our list of large “facilities” that are even bigger sources of greenhouse gases: the city’s interstate freeways (owned and operated by the Oregon Department of Transportation) and Portland International Airport (operated by the Port of Portland),

Carbon emissions from ODOT Interstate freeways in Portland:  550,000 tons per year

So how much greenhouse gas pollution is produced by ODOT’s interstate freeways in the City of Portland?  We don’t have exact data, but we can triangulate a reasonably good estimate.  According to the Federal Highway Administration, on an annual (Pre-Covid) basis, there are about 2.9 billion vehicle miles of travel on Interstate freeways in the Oregon portion of the Portland metropolitan area.   We apportion this traffic proportional to lane miles of interstate freeway in each county; Multnomah County includes about 53 percent of the tri-county area’s inventory of interstate lane miles, according to ODOT.  We further assume that 80 percent of Multnomah County mileage is in Portland.  This means that driving on Portland’s interstate freeways amounts to about 1.2 billion miles per year, and at a very conservative passenger car average of .445 kilograms of carbon per mile, produces about 550,000 tons of carbon emissions per year.

Freeways are fossil fuel infrastructure. These ODOT facilities produce more carbon emissions than all the industries taxed under Portland’s proposed “Healthy Climate Fee.”

If ODOT’s interstate freeways were treated as a “facility” and paid the $25 per ton fee for the emissions from the operation of the facility, it would pay the City of Portland about $14 million per year.

Carbon emissions from Portland International Airport:  1.5 million tons per year

Air travel is a major contributor to global greenhouse gas emissions, and Portland International Airport (aka PDX), the region’s principal air terminal the facility in Portland most closely associated with those emissions. In 2019, according to Federal Aviation Administration data, nearly 20 million passengers flying out of Portland International Airport logged about 11 billion “revenue passenger miles” of travel.  Air travel produces about 88 grams of greenhouse gases per revenue passenger kilometer, which means that PDX air travel generated about 1.5 million tons of emissions  per year (88 * 11,000,000,000*1.6/1000000).  This calculation suggests that PDX is responsible for about three-fourths of one percent of all US aviation greenhouse gas emissions, which total about 200 million tons per year, a figure roughly consistent with the region’s share of US economic activity.

Air travel is a large source of global greenhouse gases.

If Portland International Airport  were treated as a “facility” and paid the $25 per ton fee for the emissions from the operation of the facility, it would pay the City of Portland about $38 million per year.

Parenthetically:  It has to be said that the Port of Portland has a profound blind-spot when it comes to its greenhouse gas footprint.  According to the Port’s environmental report, it only counts emissions from its own vehicles, utility plant and purchased electricity, and not from the travel to and from the airport.  The port owns up to just 50,000 tons per year in greenhouse gas emissions, just 3 percent of the amount attributable to air travel.  Neither does the port count the emissions from the cars that drive to park in its garages.  That’s rather like a gun manufacturer counting as “gun deaths” only those people who were pistol-whipped and excluding those killed by bullets.

Let’s have a fair and inclusive Healthy Climate Fee

Together, these two facilities (ODOT’s interstate freeways and PDX) account for more than five times as much carbon pollution than the 35 facilities inventoried by the City of Portland and included in its proposed ordinance.   (We believe the city’s own inventory of Portland greenhouse gas emissions significantly undercounts greenhouse gases associated with air travel in and out of PDX).

It’s clear that the city believes it has the authority to impose this fee on local, state and federal governments.  It’s proposing to charge the city-owned wastewater plant more than $1 million annually, and also charge state entities (Oregon Health & Science University, the Port of Portland and Portland State University), and even the federal government (the Veterans Administration, which operates a large hospital.  The Port of Portland and the Oregon Department of Transportation both own and operate facilities that emit more than 150 tons of greenhouse gases per year.  They ought to be subject to the healthy climate fee, too.

In our view, it makes perfect sense of the city to implement a carbon tax or “healthy climate fee.”  But if it does, it should do so in a way that applies it to most or all carbon pollution, not just a twentieth of all emissions.  The city’s approach to a carbon tax is indefensibly narrow.  It gives a pass to the biggest and fastest growing sources of carbon pollution in Portland:  transportation emissions.  It’s a kind of “carrotism” the notion that climate change can be dealt with without inconveniencing anyone, when in fact, it is all of our daily decisions, especially of how much to drive and fly, that is principally responsible for greenhouse gases.  It’s politically convenient to tag a few large, visible polluters, but collectively they’re absolutely smaller than just two entities we’ve identified here, and they’re not the areas where we’re failing to make progress.

A carbon tax makes a huge amount of sense, but exempting 95 percent of all the emissions in the region from the tax, and loading its cost on just a few entities is just arbitrary.  If we’re really in a climate emergency, we should apply the carbon fee broadly.

Notes:

  1.  An empty soda can weighs 17 grams; several states impose a 5 cent deposit per can; that works out to a deposit of about $2,900 per ton of can weight).  Metro will charge you about $100 ton for the non-recyclable garbage you dispose of, about 5 times what Portland would charge you if you put that same amount of carbon in the atmosphere.
  2. Carrotism is a term coined by Economist Guilio Matteoli, it is the idea is that “climate change policy should consist entirely of enticing incentives (carrots) avoiding any restriction, regulation or even monetary disincentives (sticks); I.e. we will just glide smoothly into zero-carbon without anyone being inconvenienced ever.”

City Observatory on housing supply and affordability

Here’s just some of what we’ve had to say about research on housing markets at City Observatory.

Building more housing lowers rents for everyone
December 14, 2020
A new study from Germany shows that added housing supply lowers rents across the board.  A 1 percent increase in housing is associated with a 0.4 to 0.7 percent decrease in rents

Want more housing? Build a landlord.
By Ethan Seltzer November  19, 2019
If we’re going to have a lot more missing middle housing; we’re also going to have a lot more landlords. Accessory dwellings, duplexes, triplexes and four-plexes are suited to “mom-and-pop” landlords, but tough tenants rights requirements may discourage many homeowners from creating more housing.

Triumph of the NIMBY’s: Less affordable, more displacement
June 25, 2020
When NIMBYs win, everybody loses.  Constricting housing supply drives up the price of housing further, and accelerates displacement, in rich neighborhoods and in poor ones.

Gentrification: the case of the missing counter-factual
February 24, 2020
The implicit assumption in most gentrification research is that if a neighborhood doesn’t change, that it stays the same, but almost no one looks at that question.  Displacement by decline is much more common, and more harmful than displacement due to gentrification.

How gentrification benefits long-time residents of low income neighborhoods
July 19, 2019
The new Philadelphia Fed study of gentrification is the best evidence yet that gentrification creates opportunity and promotes integration

Anatomy of a rental marketplace
April 3, 2020
A new report from the DC Policy Center shows the inner-workings of the shadow rental market that is a key to housing affordability

Why Atlanta’s anti-gentrification moratorium will backfire
February 24, 2020
Blocking new development will only accelerate demand for existing homes.  The moratorium makes flipping houses even more lucrative

Why TOPA isn’t the tops
January 9, 2020
Turning renters into owners is not a simple solution to housing affordability

A solution for displacement: TIF for affordable housing
June 11, 2019
The case for using tax increment financing for affordable housing in gentrifying neighborhoods

Another housing myth debunked: Neighborhood price effects of new apartments
June 4, 2019.
New research shows new apartments drive down rents in their immediate neighborhood, disproving the myth of “induced demand” for housing

Kevin Bacon & musical chairs: How market rate housing increases affordability
April 15, 2019
Building more market rate housing sets off a chain reaction supply increase that reaches low income neighborhoods.  Households moving into new market rate units move out of other, lower cost housing, making it available to other households; the propagation of this effect produces additional housing supply in lower income neighborhoods

The end of the housing supply debate (maybe)
November 8, 2017
Slowly, the rhetorical battle is being won, as affordable housing advocates acknowledge more supply matters

Will upzoning ease housing affordability problems?
May 15, 2019.
More housing supply denialism–debunked

You’re going to need a bigger boat
January 7, 2019
We’re going to need more apartments, too. Eliminating exclusively single-family zones won’t provide enough density: Recognizing the limits of “missing middle” as a solution to urban affordability

The long tail of the housing bust
November 19, 2018
Adjusted for inflation, US home prices are still lower than in 2006. 124 million people live in the 32 metropolitan areas where real housing prices are still below 2006 levels; just 50 million live in the 21 metropolitan areas where real housing prices are now higher than in 2006.

Homeownership: A failed wealth-creation strategy
July 18, 2016
Swings in credit availability work to systematically disadvantage lower income and lower wealth buyers, who tend disproportionately to be people of color.

If you want less displacement, build more housing
August 27, 2018
The more you limit housing, the more you increase displacement

We disagree with the Washington Post about housing economics
August 13, 2018
Contrary to what you think you may have read in last week’s Washington Post, rental housing markets at all levels still conform to the laws of supply and demand

No exit from housing hell
May 3,2018
Distrust and empowering everyone to equally be a NIMBY is a recipe for perpetual housing problems.Two market rate houses reduce displacement as much as one affordable house

Is Fruitvale gentrifying? Did it prevent displacement?
May 8, 2018
What does Fruitvale tell us about gentrification and displacement?  Gentrification solved, or at least prevented.

Signs of the times
October 26, 2017
“For Rent” signs are popping up all over Portland, signaling an easing of the housing crunch and foretelling falling rent

Caught in the prisoner’s dilemma of local-only planning
September 21, 2016
Fragmented local government and the devolution of land use controls creates perverse incentives that restrict housing supply, perpetuate segregation, make housing less affordable and lead to more sprawl and pollution

When supply catches up to demand, rents go down
March 21, 2016
A parable from the oil belt about housing markets.

Urban myth busting: New rental housing and median-income households
February 17, 2016
This myth is busted: building more high end housing doesn’t make housing less affordable.

What filtering can and can’t do,
By Daniel Hertz
November 10, 2015
How filtering works—and doesn’t work—in housing markets.

The immaculate conception theory of your neighborhood’s origins
September 24, 2015
Those affordable bungalows you prize today were once yesterday’s high end developer built housing.

Housing discrimination is baked into zoning

The real housing discrimination today is institutional, not personal

The unfinished business of dismantling the institutional racism built into zoning

Overt, personal discrimination in housing is just the tip of the iceberg, the great and devastating mass of discrimination is below the surface, in the form of apartment bans and minimum lot sizes.

Is there anything more ugly, hurtful and personal than saying to someone, I don’t want you to live here because of your race, ethnicity, religious beliefs, or gender identity?  Thanks to Federal and State fair housing laws, it’s now the case that this kind of overt discrimination is illegal.  And it is unquestionably right that proscribe and punish this kind of fundamentally anti-social behavior.

But the face of discrimination has changed in the five decades since the Fair Housing Act was adopted.  There continue to be, to be sure, horrendous and insulting instances of overt housing discrimination.  But today the real housing discrimination is far more subtle and pervasive than a “need not apply” sign, or even a disingenuous “the apartment’s already been rented” claim.

Rome, GA, 1943. (Esther Bubley, photographer. “A sign at the Greyhound bus station.” Collection of the Library of Congress)

The most pernicious forms of discrimination are those that are deeply embedded in our policies, and that are executed by impersonal laws and constrained markets, not sneering racists.

Patterns of overt housing discrimination.

One of the most reliable and widely practiced means of detecting discrimination and enforcing fair housing laws is “testing”–sending otherwise identical applications, with varying racial or ethnic backgrounds, to apply for the same home or apartment, and observing whether they are treated similarly, or not. Likewise, state and federal agencies also receive and tabulate complains of discrimination from those who feel they’ve been unfairly denied access to housing.

A recent study of the geographic pattern of housing discrimination in Detroit—Residential Racial and Socioeconomic Segregation as Predictors of Housing Discrimination in Detroit Metropolitan Area—looked at several decades of data on fair housing complaints, with the objective of observing  where discriminatory behavior seemed to be most prevalent.

As an aside, it’s rare in an academic paper that you find an author reporting data that clearly falsifies their priors.  Like clockwork, most published papers seem to confirm, or at worst refine, the author’s pre-existing theses about the subject at hand.  What makes this study from Detroit remarkable, in part, is that the authors find that their previous hypothesis was exactly wrong.

The authors started out with the idea that housing discrimination, particularly against black applicants, would be more common in predominantly white neighborhoods.  On its face, that makes sense:  racial tensions and discrimination ought to occur more often when prospective renters or buyers are from a different race or ethnicity than is predominant in a neighborhood.  The author’s of this study were surprising to find that in the Detroit area, reported instances of housing discrimination are lower in white communities, higher income neighborhoods, and in places with more expensive housing.

Detroit is a logical place to study discrimination; it is one of the two or three most segregated metro areas in the country. The city of Detroit and surrounding Wayne County are disproportionately Black, suburban Macomb and outlying cities are disproportionately white.

One of the historic reasons for segregation in the US is housing discrimination:  landlords, real estate agents, and sellers refused to sell or rent housing to Black families. (More than 90 percent of the complaints in the study involved discrimination on the basis of race).  The authors relate the long literature on housing discrimination, and advance a couple of theories, involving a distaste on the part of White families for having Black neighbors, and a desire of landlords and real estate agents to curry favor (and business) from these racist households, and notions that discrimination is somehow more profitable for sellers and landlords (something that economists tend to dispute).

The author’s hypothesize that because of the roots of discrimination are based on white racism, that the incidence of housing discrimination ought to be greater in Whiter, more expensive, and higher income communities.  Surprisingly, they find that just the opposite is true:  reported housing discrimination complaints are proportionately much more common in Detroit area neighborhoods that have a higher Black population, more affordable housing and more modest incomes.

Contrary to our hypotheses, findings reported here suggest that housing discrimination incidents in the DMA [Detroit Metropolitan Area] were lower in neighborhoods with greater proportions of NHW[non-Hispanic whites], homeowners, and higher median household incomes. We discuss the potential for housing discrimination to perpetuate segregation by maintaining racialized residents in certain neighborhoods. Our findings suggest that housing discrimination is more likely to occur in neighborhoods with higher percentage of NHB [non-Hispanic Black] residents, more renters, and lower median household incomes

The authors ruminate that perhaps their seemingly counter-intuitive finding is a product of under-reporting of discrimination in white neighborhoods, but as with assertions of widespread voter fraud in the last presidential election, there’s no evidence that’s the case.

The authors largely overlook a simpler and more obvious explanation:  Private discrimination is actually unnecessary in these wealthier, predominantly white neighborhoods because its built into the zoning codes.  A combination of large lot zoning and apartment bans in suburbs mean that most people of color don’t have the means to afford housing in white, higher income and higher valued neighborhoods.  Discrimination is effective achieved, to paraphrase Richard Rothstein, “by color of law”—freeing homeowners, landlords and sellers in these neighborhoods from the messy and distasteful business of having to personally engage in discrimination.  Prospective tenants and homebuyers are excluded by high home values and rents.

There’s a further point here, as well:  Housing discrimination as enforced through the zoning code is actually more about class than it is about race.  By themselves, high rents and high home values don’t exclude higher income Black households from these more affluent and predominantly white neighborhoods.  And the trend that we’ve seen in the past several decades is that higher income black households have become increasingly suburbanized and integrated.  Patrick Sharkey finds

. . . black middle and upper classes have transitioned out of central-city, primarily black neighborhoods into a more diverse group of racially mixed residential settings that are increasingly located in suburban areas.

The problems of segregation for low income people of color has actually been accentuated by this process of income po