National Transportation Group Recommends Strategies for Retrofitting and Rebuilding Roads to Incorporate Green Infrastructure

July 21st, 2017

By Alex Highley, GOPC Project Coordinator

The National Association of City Transportation Officials (NACTO) has released an Urban Street Stormwater Guide, offering city officials recommendations for adopting “green,” as opposed to “grey,” infrastructure solutions to improve streets’ ability to handle rainwater runoff. The recommendations on stormwater infrastructure complement many of NACTO’s transportation priorities, such as investing in complete streets that are accessible to all users. NACTO notes the cost-effectiveness of green infrastructure, and explains the ecological, social, and regulatory benefits of its usage. In the guide, NACTO shares some of the best practices being used around the country, where engineers and public officials have taken steps to incorporate green infrastructure into systems that are already in place.  The memo shows how far green infrastructure has come in the last 20 years: from an afterthought, to mainstream best practice. 

According to NACTO, 60 percent of urban areas are made up of some kind of impervious surface, such as concrete, meaning that water and other liquids cannot seep into the surface. Green infrastructure offers an alternative, whereby there is more surface area for water to go in the event of a storm. Green infrastructure comes in many different forms, including structures such as rain gardens, bioswales, and green roofs, and is a rare asset to cities because unlike most resources, green infrastructure actually appreciates over time because as plants grow larger they become stronger and more effective.

IMG_0248

Green Infrastructure in Cleveland, Ohio

In alignment with NACTO, Greater Ohio Policy Center (GOPC) supports policies to modernize Ohio’s sewer and water infrastructure. In 2016, GOPC published a memo assessing the benefits that green infrastructure provides to communities in terms of cost and effectiveness, and analyzes some regional case studies. Many Ohio cities use green infrastructure to divert stormwater from antiquated combined sewer systems that overflow in large storms, dumping wastewater into rivers.  For example, it is far cheaper to create more parks and bioswales than it is to excavate a deep tunnel that can store millions of gallons of runoff.  Earlier in 2017, GOPC released Strengthening Ohio’s Water Infrastructure: Financing and Policy, which explores innovative strategies for modernizing the system in Ohio. Visit GOPC’s Sewer and Water Infrastructure page for all of the latest state and national news and resources on this critical policy area.

In the Urban Street Stormwater Guide, NACTO advocates for local governments to include green stormwater infrastructure into their formal policies and plans, which could include Green Streets Policies, specific stormwater codes and regulations, and developer incentives to expand green design practices. The guide also includes technical suggestions for retrofitting green infrastructure into streets, along with successful methods to execute comprehensive street reconstruction. Throughout the process of introducing a green infrastructure project, NACTO firmly recommends that city officials understand and evaluate variables such as the health of the watershed, existing infrastructure, flood zones, regulatory requirements, and current land use and zoning codes.

See NACTO’s report here and visit GOPC’s Sewer and Water Infrastructure page for all of the latest state and national news and resources on this critical policy area.

 

Connecting People to Jobs: The Economics of Job Hubs and Employment Access

July 19th, 2017

Glue Cleveland Tour 229

 By Jason Warner, GOPC Manager of Government Affairs

Recent studies have shown that over the past two decades or more, more land is being used today, expanding the places where jobs are located, but this is occurring without a net increase in population or jobs. This new type of urban sprawl, known as “no-growth sprawl,” has the effect of separating workers from the jobs they need to support themselves and their families. Cleveland is one of those cities where this has been an especially troubling trend. Now, a number of groups are working on solutions to the problem of erasing the disconnect between people and jobs. 

Fund for Our Economic Future (“The Fund”), working in partnership with the Northeast Ohio Areawide Coordinating Agency (NOACA) and Team NEO, has been examining the concentration of jobs hubs in Northeast Ohio and the benefits and challenges they present to the region. Job hubs are specific places of concentrated economic activity in a city or region, with specific focus on where “traded sector” companies are located in the region. Traded sector companies are organizations that can sell their goods and services outside of the local economy.  The Fund examined job concentration centers in the five counties that make up the NOACA area, Cuyahoga, Geauga, Lake, Lorain, and Medina Counties, and identified 23 job hubs. These include obvious locations such as Downtown Cleveland, but others as well, including places are far away from the city as Oberlin to the west and Middlefield to the east.

The disbursement of these jobs hubs is at the center of the research the Fund is currently reviewing. Half of the traded sector employment was found to be in a jobs hub in the region.  These jobs are very much in demand and are needed for the local, state and national economy. Additionally, these are jobs that traditionally provide higher income and greater career opportunity than typical service employment jobs. As these hubs move further and further from population centers, transporting people to the jobs is becoming an increasing problem. A survey conducted  by Team NEO found that, when asked to rate what was the biggest challenge to making new employees successful, the most popular answer among employers was employees showing up to work on time and being ready to work when they got there.

This is not to suggest that job hubs are bad things – as the Fund points out, when job hub are integrated into a regional growth strategy, they can improve economic competitiveness and increase opportunities for residents who are currently disconnected from jobs[i]. The biggest obstacle that job hubs present is ensuring that workers have access to these locations. The current pattern of growth that Northeast Ohio and other regions of the state have experienced is increased costs of both time and money for residents. Research by the Brookings Institute shows that the number of jobs within a typical commuting distance fell by 26 percent between 2000 and 2012, which is among the worse measurable rates in the nation[ii]. Furthermore, the research shows many Ohioans spend a disproportionate amount of their income on transportation as opposed to housing[iii].

Most concerning of all is that the Fund’s research shows that 25 percent of Cleveland residents do not have access either to a vehicle they own or, in increasing numbers, to public transportation[iv]. Hence, the challenge the Fund and others face is finding a solution to connect people who lack transportation to job locations, where employers find that their biggest struggle is finding workers who can get to work on time and be ready to work.

Transit agencies statewide are struggling to meet the ever-increasing demands for public transit. Greater Ohio Policy Center (GOPC) is working with groups like Fund for Our Economic Future to ensure that sufficient funding is available for public transportation and that service is designed to ensure that workers can be connected with jobs. For more resources on GOPC’s work in this area, please see our Transportation Modernization webpage.

 

[i]  Fund for Our Economic Future: Why Job Hubs are Important

[ii]Fund for Our Economic Future: Job Access

[iii] Ibid.

[iv]Governing Magazine: Car Ownership Numbers

 

Ohio’s FY2018-19 Main Operating Budget Moves to Next Stage; GOPC Offers Recommendations

May 18th, 2017

By Jason Warner, GOPC Manager of Government Affairs

Recently, the Ohio House of Representatives approved a drastically different two-year state budget from the one proposed by Governor John Kasich in January. The House budget included roughly $632 million in reductions due to decreased state revenue collections, and so far for the fiscal year FY2016-17, receipts are $773.7 million, or 4.2 percent, below projections. This followed an announcement in April by state leaders that the budget would need to be revised downward by roughly $800 million for the next biennium (FY2018-19).

With passage of the House version, the budget now moves to the Ohio Senate, where additional reductions will be needed to meet the $800 million in cuts. The deadline to approve the budget is June 30, when the current state fiscal year (FY2017) ends. Greater Ohio Policy Center (GOPC) continues to testify on several changes to be made in HB49, including the following provisions. 

GOPC-Supported Provisions:

- The budget bill provides $4.8 million in annual funding over the biennium for lead remediation and associated testing services for homes under lead hazard orders, ensuring that more properties are made safe for families. This will be done through the use of federal funding available to the state.  GOPC is pleased by the state’s commitment on this important issue and encourages the Legislature to ensure local lead abatement programs are empowered to utilize the funding.

GOPC-Opposed Provisions:

- A House amendment would mandate stickers be affixed to retail service station pumps displaying the rates of federal and state taxes applicable to gasoline and diesel fuel. The stickers would be produced and distributed by the Department of Agriculture at an unknown cost. All pumps would be required to have the stickers affixed within 14 months of the bills effective date and would need to be replaced if damaged or if the state or federal tax rates change. 

- The House reduced funding for public transportation by more than 11% per year for both FY2018 and 2019. This line item provides funding for the Public Transportation Grant Program and the Elderly and Disabled Fare Assistance Program. This line item has been reduced by more than 68% or $17,969,134, since FY2000. 

GOPC’s Proposed Amendments to the Bill:

- GOPC proposes an amendment to make it easier for cities to clean up contaminated brownfield sites.  The proposal would modify Ohio law to make it clear that urban renewal projects can recover the costs of environmental remediation. In an urban renewal project, a municipality and a developer create a development agreement to mitigate a blighted area.  After development begins, the property owner makes service payments in lieu of taxes, based on the increased valuation of the property.  Service payments support bonds that have been issued to support redevelopment costs.

- The federal Center for Medicare and Medicaid Services has issued a directive that Ohio cannot continue applying state and local sales taxes on the premiums of Medicaid Managed Care Organizations. HB49 provides for a new service fee to be charged to make-up for lost state revenue, while only providing partial, temporary financial relief to counties and transit agencies. GOPC supports the inclusion of a provision in HB49 that will extend greater financial relief to counties and transit agencies. 

For more complete coverage of the Main Operating Budget, please visit here.

Infrastructure Week Highlights Urgent Need to Invest in our Declining Transportation and Water and Sewer Systems

May 15th, 2017

By Jon Honeck, GOPC Senior Policy Fellow

Infrastructure Week is May 15 – 19, 2017.  GOPC considers infrastructure, especially transportation and water infrastructure, to be vital components of Ohio’s economic revitalization agenda.  During Infrastructure Week, groups across the nation are holding events and doing everything they can to draw attention to the unacceptable condition of the nation’s infrastructure.  Overall, the American Society of Civil Engineers (ASCE) gives U.S. infrastructure a grade of “D+”.  Although the term “infrastructure” usually brings to mind surface transportation – roads, bridges, and railways – the ASCE’s concerns extend to many forms of infrastructure that make a modern economy work, including drinking water and wastewater systems, air travel, ports, and the electrical transmission grid.   The ASCE estimates that underinvestment will cause the average family to lose $3,400 each year as a result of infrastructure deficiencies. 

As seen in the chart below, public sector spending on infrastructure declined from nearly 3.5% of gross domestic product (GDP) in the late 1950s to just above 2.5% today.  Although federal policy definitely shapes overall societal policy choices (e.g., the interstate highway system), the chart also makes it clear that states and local governments have been doing the heavy lifting when it comes to infrastructure spending, and probably will continue to do so in the future.  Federal outlays in recent years been about 0.6% of GDP, about one-fourth the state and local government total.

 Infrastructure Spending as a Percentage of U.S. GDP

infrastructure chart

Source: GOPC analysis of BEA and CBO data.

Across the country, states are doing what they can to take charge of their own destiny, including finding ways to pay for what they need to improve transportation.  Most states, and the federal government, rely on gasoline excise taxes to pay for surface transportation.  For many years, discussions about raising the gasoline tax were off the table at both the state and federal levels.  The federal gasoline tax has not been raised since 1993; Ohio’s has been the same since 2005.  This inaction meant that state transportation budgets have failed to keep pace with inflation, putting more pressure on their ability to perform basic maintenance.  As the economy has improved, however, state leaders have put together coalitions to support improved funding.  Since 2012, nearly half the states have adjusted their approaches to taxing gasoline.  Some of the most recent to move in this direction in 2017, including Indiana, South Carolina, and Tennessee, are generally considered to be fiscally conservative states.  These changes at the state level may build momentum for a reexamination of transportation funding at the federal level. 

The country’s focus on infrastructure is not only an opportunity to rebuild, but also to improve and rethink what we need to be successful in the 21st Century, as GOPC outlined in a Cincinnati Enquirer op-ed.  Proceeds from the state gasoline tax in Ohio are constitutionally required to be spent on highways, and do not address the needs of Ohio’s residents for public transit or alternative modes of travel such as biking or walking.  Despite an increased transfer of federal funds to public transit in the Ohio Department of Transportation budget, Ohio’s overall state level of support for public transit is minimal compared to that of other states.  GOPC believes that future state transportation reform should include a dedicated revenue source for public transit that will help local transit authorities design the kind of flexible and affordable systems that Ohioans deserve. 

 

Driverless cars could be the attractive future but public transportation is the vital present

May 8th, 2017

By Alex Highley, GOPC Project Associate

Many states across the country, including Ohio, have begun to embrace the idea that driverless cars will soon represent an exciting, safe, and more efficient alternative to human-controlled vehicles. Last year, Columbus was awarded the federal Smart Cities grant, which pledges millions of federal dollars to be invested in new technologies for driverless cars. While autonomous vehicles may eventually solve some of the transportation challenges Ohio faces once their usage is proven to be safe and effective, leaders in the state should focus their efforts today on expanding and strengthening public transit. Greater Ohio Policy Center (GOPC) believes that Ohio must prioritize investment in the existing transportation system, where the technology already exists to safely and efficiently transport people to jobs, doctors, and grocery stores.

While autonomous vehicles may one day rule the road, it is imperative that Ohio develops transportation solutions for residents who seek a means of mobility in the short-term. Public transit is a proven form of transportation that if invested in properly, can produce a number of economic development benefits for residents and businesses within communities of all types. Ohio’s population is aging and many residents, especially those living in rural areas, do not have reliable access to a car to get to job opportunities, medical appointments, family, and the grocery store. Because Ohio’s land usage pattern is defined by sprawling communities, residential areas are often located far from job sites and thus qualified individuals are unable to fill positions at companies seeking their talents. Improving transit service through, for instance, regionalization, will ameliorate these difficulties by connecting workers with key destinations and allow them to participate in Ohio’s economy.

Cota on high st

However, there is a glaring shortage of good-working public transportation buses and vans in Ohio. As the Ohio Department of Transportation Transit Needs Study notes, 27 counties in Ohio do not even operate a public transit network, which means that many people rely on health and human service transportation functions to get to important destinations. Even within the transit agencies that do offer service, over a third of the 3,240 vehicles are beyond their useful life, yet they are still on the roads. As demand grows among all age groups, investment in the system is even more crucial. By 2025, the Transit Needs Study estimates that an additional $562 million in annual funding will be needed to meet the future demand for public transit statewide.

Given the general level of uncertainty surrounding driverless cars, leaders at all level of government and business should concentrate efforts on existing transportation systems. At the moment, 74 percent of Americans simply do not believe driverless cars will be safe to use. Until the public has demonstrated it trusts the new technology, it would be premature to pool resources into a system with so many lingering questions. Even if Ohioans do at some point accept autonomous vehicles as a viable alternative to driver-operated cars, it is unlikely that their costs, at least initially, will make them accessible to a wide cohort of citizens. Thus, the proliferation of the technology would likely do little to help residents who struggle to find a way to get to doctor’s appointments. By supporting a robust, modernized public transportation system, Ohio’s leaders can build a successful, fluid network of travel for workers and residents throughout the state.

For more resources on transportation policy affecting Ohio’s cities and regions, please visit GOPC’s Transportation Modernization webpage

 

Pending Congressional Approval, Federal Budget Will Cut Important Transportation Grant Program

April 13th, 2017

By Alex Highley, GOPC Project Associate

Under the Trump administration’s recent budget proposal, a crucial grant program supporting capital investment for transportation projects across Ohio and the country is slated to be abolished. The federal program known as the Transportation Investment Generating Economic Recovery (TIGER) grants are earmarked to be eliminated, unless the House and Senate budget bills reverse the provision doing away with the program. Funding for TIGER, a program that was developed in 2009 as part of the federal Recovery Act, is allocated to state Departments of Transportation (DOT) and local jurisdictions by Congress following a merit-based award process. Should Congress decide to scrap the program, some planned transit, rail, and bike and pedestrian projects in Ohio could fail to produce the funds necessary for completion.

Since 2009, TIGER grants have funneled over $4 billion to a variety of innovative transportation projects around the country, including transit, rail, port, road, and bike and pedestrian. Since the program’s inception, the annual program budget has declined over time, reducing the number of awarded projects, while applications have ramped up. The US Department of Transportation’s (USDOT) latest round of TIGER grant awards, known as TIGER VII, are set to deliver $500 million to various projects nationwide. In total, this amount will support 39 capital projects in 33 states. However, award amounts have been slowly declining since the initial TIGER I, which funded 51 separate capital projects in the form of $1.5 billion in award money.

Downtown overhead

Akron’s downtown promenade was awarded a $5 million TIGER capital grant in 2016. Photo credit: AkronStock 

TIGER grants are immensely important in Ohio, where they offer needed funding assistance to multi-modal projects that would struggle to generate the necessary funding otherwise. For example, in 2015 $6.8 million was awarded to Ohio to divide among sparsely-funded public transit agencies in rural areas of the state such as Athens, Wilmington, Chillicothe, Knox, Lancaster, Marion, Logan, and others. Moreover, the Opportunity Corridor project, which is a path designed for transit, bikes, and pedestrians in northeast Ohio, along with the downtown promenade in Akron, have enjoyed the fruits of grant awards in recent years. In total, Ohio has received over $79 million from the TIGER program for transportation projects (see the table below for a year-by-year breakdown).

The success of the program is manifested by the substantial local investment it has spurred. USDOT calculates that TIGER’s initial investment has leveraged $1.74 billion in matching funds by state and local actors, including the private and public sectors contributing to the completion of the project. However, due to the program’s widespread appeal, acquiring TIGER grants have become increasingly more difficult. As local transportation projects face a dwindling supply of resources, the TIGER program has become more competitive given the increasing demand. Subsequently, many advocates have called for an expansion of the program to aid local governments in finishing important projects.

Scrapping the program entirely would represent a big blow to public transportation systems in Ohio in particular, given many local systems are insufficiently supported. The Ohio Department of Transportation’s (ODOT) 2015 Transit Needs Study estimates that Ohio’s public transportation systems suffer from a $192.5 million dollar funding shortfall in combined capital and operations needs. Moreover, the study finds that the state of Ohio spends just 63 cents per capita on public transportation over the course of each year, ranking Ohio 38th in the nation in its investment in this crucial policy area.

Greater Ohio Policy Center (GOPC) believes that Ohio’s recently-passed transportation budget, which includes a $10 million increase in flex funding for public transportation, is a positive step to modernizing the state’s transportation system. However, local systems will continue to struggle to meet the demands of riders, and the possible federal elimination of the TIGER program will increase the financial strain on cash-strapped agencies that are seeking the funds to ensure they can properly invest in their capital systems as well as operate sufficiently.

For more resources on transportation policy affecting Ohio’s cities and regions, please visit GOPC’s Transportation Modernization webpage.

 

TIGER Grants Total Award Amounts in Ohio

2009: $20 million

2010: $10.5 million

2011: $12.5 million

2012: $16 million

2013: no award

2014: $400,000

2015: $6.8 million

2016: $12.9 million

Grand Total: $79.1 million

 

Economic Impact Analysis Reveals Added Value to US Economy of Investing in Water Infrastructure and Warns of Multiplying Costs if Funding Gap is Deferred

April 7th, 2017

By John Collier, GOPC Intern

The Value of Water Campaign recently released the Economic Impact of Investing in Water Infrastructure – a report aimed at quantifying the economic impact water infrastructure has on the US economy. The campaign brings together leading water industry experts to better understand the economic benefits associated with closing the funding gap for water infrastructure spending, as well as the potential costs of failing to do so.

The US is at a tipping point when it comes to its water infrastructure. The infrastructure built in the last century, with a lifespan of 75 to 100 years, is coming to the end of its lifespan. Estimates from the American Society of Civil Engineers suggest the US will need to spend a minimum of $123 billion per year on capital improvements over the next 10 years to maintain a good state of repair. To put the scale of this infrastructure improvement into perspective, the report states that one-third of US water mains will need replaced by 2040. Current funding levels at all levels of government are not sufficient, and leave a sizeable funding gap. The report notes that aggregate capital spending across the local, state, and federal levels is only $41 billion per year, leaving an $82 billion annual funding gap. If current needs are left unmet, the report warns this funding gap will increase to $109 billion per year by the year 2026.

The benefits of meeting the funding gap are bigger than simply avoiding service disruptions, and would ripple to the farthest reaches of the economy. The US stands to gain $220 billion dollars in annual economic activity and would create 1.3 million jobs nationwide over ten years, should the water infrastructure funding gap be closed. Many of these jobs that are involved in the design and construction of improved water infrastructure are well paying and are attainable with a high school diploma. Moreover, indirect effects of investing in construction would create positive indirect effects on the economy, such as the purchase of working supplies in interrelated industries. An added benefit to the investment is the $94 billion businesses would save each year due to no longer needing to fund their own water supplies.

Water Treatment Plant - wikicommons

        Water Treatment Plant. Photo credit: Wikicommons

The campaign asserts that as the nation moves to assess and repair its aging infrastructure, there is need for significant federal investment. From 1977 to 2014, federal contributions have fallen from 63 percent of total spending to 9 percent of total capital spending on water infrastructure. Much of the burden has been picked up at the local level – per capita spending by local communities has risen from $45 in 1977 to upwards of $100 in 2014.

Greater Ohio Policy Center (GOPC) recently released Strengthening Ohio’s Water Infrastructure, a report exploring the opportunities at the state level to ensure long-term financial stability of Ohio’s water infrastructure. The use of asset-management, regionalization, and private-public partnerships may be the key for the financial stability of Ohio’s water systems and adequately funding capital improvements.  Affordability is becoming more of a strain for some communities as user charges continue to increase in parallel with national trends. 

Modernizing the water system for the 21st century remains one of GOPC’s main policy objectives. GOPC is in the midst of a multi-year project on Ohio’s water and sewer infrastructure – and is currently identifying the best practices from around the nation.

For further resources and reports, please visit GOPC’s Sewer and Water Infrastructure Resource Page

 

President’s Budget Blueprint Reduces Overall Federal Support for Water Infrastructure

April 6th, 2017

By Jon Honeck, GOPC Senior Policy Fellow

In March 2017, the Trump Administration released its summary budget blueprint for Federal Fiscal Year (FFY) 2018, which begins October 1, 2017.  The plan signals the administration’s overall intention to cut non-defense domestic programs in order to free up funds for increased military spending.  There is a long road to travel before any parts of the plan are enacted, and many members of Congress have already gone on record expressing reservations about specific elements of the proposal.  Nonetheless, the blueprint creates a starting point for agency budget plans that will be presented to Congress in the coming months.   

This blog discusses the administration’s proposed changes to how the federal government will support investments in water infrastructure.  The Trump Administration’s budget blueprint would eliminate the USDA Rural Development water and wastewater loan program, the Appalachian Regional Commission (ARC), the Community Development Block Grant (CDBG), and the U.S. Department of Commerce – Economic Development Administration (EDA).   The plan would preserve funding for the U.S. Environmental Protection Agency (USEPA) water and wastewater revolving loan funds, although the agency as a whole would face a 31 percent budget reduction, resulting in the elimination of 3,200 agency staff positions and a 45 percent reduction in categorical grant programs.  One of these categorical grant programs provides states with funding for the oversight of local drinking water systems.  It helps pay for the Ohio EPA to monitor local compliance with protocols for the control of lead and other contaminants. 

The budget proposal should be analyzed in the context of the nation’s critical need to modernize drinking water, wastewater, and stormwater infrastructure.  This issue is a high priority for Greater Ohio Policy Center (GOPC) because of its links to economic development, land use planning, and the potential for financial strain on Ohio families and communities (see our recent Water Infrastructure reports).  According to EPA estimates, Ohio water utilities (typically local governments) will need to make capital investments of $26 billion in drinking water and wastewater infrastructure to meet identified needs over the next 20 years.   User charges have been rising steadily, faster than the rate of general consumer inflation. 

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                           Photo courtesy of Wikicommons

The federal government plays a major role in financing water infrastructure investments, although the approach has changed significantly over the decades.  With the passage of the federal Clean Water Act in the early 1970s, Congress created a large grant program to assist local governments with the modernization of wastewater treatment plants and related infrastructure.  The federal government paid 75 percent of project costs in the initial program, which was changed to 55 percent in the 1980s.  This was one of largest federal infrastructure programs since the interstate highway program of the 1950s and 1960s. 

In the late 1980s, Congress phased out the wastewater grant program in favor of a revolving loan approach.  A revolving loan for drinking water infrastructure was added in the late 1990s.  Under the current policy, each year the U.S. EPA provides a capitalization grant to state revolving loan funds which lend directly to local governments at subsidized interest rates.  The state must provide a 20 percent match for the grant.  In FFY 2016, the Ohio EPA received a $75.2 million capitalization grant for its Water Pollution Control Loan Fund, and $23.1 million for the Drinking Water Assistance Fund.   Communities that want a market-rate loan with fewer administrative hurdles can approach the Ohio Water Development Authority, which runs a state-supported revolving loan fund.   

The result of this change in federal strategy is that local communities bear the largest responsibility for financing water infrastructure.  Communities that need a grant to complete their capital project must rely on other sources, which are extremely limited and competitive.  At the federal level, these sources include the USDA Rural Development – Water and Wastewater Loan program, the Appalachian Regional Commission (ARC), the Community Development Block Grant, and the Economic Development Administration.  The USDA and ARC programs are targeted at smaller, low income communities in rural counties that need them the most.  In FFY 2016, USDA Rural Development made 17 grants for a total of $14 million to Ohio communities, and an additional 16 loans for $44.6 million.  The ARC, a smaller agency, made 12 water infrastructure grants for a total of $2.7 million in Ohio.  The CDBG provides several million dollars in Ohio each year for water and infrastructure through its Critical Infrastructure Program.  (For more information on the challenges of water infrastructure in Ohio, see panelist presentations from GOPC’s Investing in Ohio’s Future 2017 Summit and our report Strengthening Ohio’s Water Infrastructure). 

The Budget Blueprint asserts that the USDA and EDA programs are duplicative of the state revolving funds and other programs, and that the CDBG is “not well-targeted to the poorest populations and has not demonstrated results.” The ARC is part of a long list of small, independent agencies slated for elimination.  The administration’s claims deserve close scrutiny from Congress, however.  The underlying issue is whether the federal government has any responsibility to provide grants, and the importance of grants in sustaining investments by small communities.  For small towns, grant funding can provide the missing piece of capital that makes a project affordable.  In Ohio, state and federal agencies have worked together for decades and often find ways to share responsibility for financing projects in small communities.  An interagency Small Communities Environmental Infrastructure Working Group (SCEIG), meets regularly throughout the year to provide advice to local governments seeking financing, and coordinates technical assistance programs. 

The elimination of these three federal programs would make the Ohio Public Works Commission (OPWC) the only significant remaining source of grant funding for water infrastructure in the Buckeye state.  (The EPA revolving loan funds have a limited number of loans that allow partial principal forgiveness.)  Most OPWC projects are prioritized at the local district level, and must compete with transportation projects.  In the context of rising concerns in Ohio and nationally about the affordability of infrastructure, a “one size fits all” approach to financing may backfire. 

For further resources and reports, please visit GOPC’s Sewer and Water Infrastructure Resource Page

 

GOPC Testifies on Transportation Budget in House Subcommittee

February 16th, 2017

Recently, Greater Ohio’s Manager of Government Affairs, Jason Warner, had the opportunity to testify before the House Finance Subcommittee on Transportation regarding House Bill 26, the state transportation budget for FY2018-2019. The subcommittee held hearings throughout the week on the proposed budget, which provides appropriations for programs funded with motor vehicle fuel taxes and registration fees (primarily in the Departments of Transportation and Public Safety.

GOPC full testimony is below and can also be found in PDF format here. You may also review all the testimony which the subcommittee heard on the committee’s website.

 

House Finance – Transportation Subcommittee
House Bill 26: State Transportation Budget | Interested Party Testimony
Jason Warner, Greater Ohio Policy Center
February 9, 2017

Chairman McColley, Ranking Member Reece and members of the Transportation Subcommittee, I want to thank you for providing me this opportunity to speak to you today about transportation in Ohio and the state’s transportation budget for FY2018-19.

My name is Jason Warner and I am the Manager of Government Affairs at the Greater Ohio Policy Center. Greater Ohio is a nonprofit nonpartisan organization that is valued for its data-driven research. Our mission is to champion revitalization in Ohio to create economically competitive communities.

As I am sure you are aware, Ohio is a cornerstone of our nation’s transportation infrastructure. I would like to focus my testimony today on what Greater Ohio sees as a policy platform to support a robust, competitive transportation system that will continue to keep Ohio at the forefront of meeting the increasing demands for a 21st Century transportation system for a 21st Century economy. We do not consider these to be aspirational goals, but rather a blueprint and effective strategic plan.

I would like to begin my remarks today with an overview of public transportation in Ohio. Ohio boasts a strong and productive public transportation network, which includes 28 urban and 33 rural systems. ODOT data shows that over 115.1 million passenger trips were provided by the state’s transit systems in 2013, the most recent year statistics are available.

Yet, 27 counties in Ohio feature no form of public transportation (either fixed route or on-demand service) and the state spends only 63 cents per capita for public transit. That is why Ohio ranked 38th in the nation in terms of state investment in public transportation, below North Dakota. It’s worth noting, that among Ohio’s neighboring states, the state ranks ahead of only Kentucky:

  • Pennsylvania – 9th ($85.55 per capita) 
  • Michigan – 15th ($24.33 per capita) 
  • Indiana – 19th ($8.57 per capita) 
  • West Virginia – 32nd ($1.50 per capita) 
  • Ohio – 38th ($0.63 per capita) 
  • Kentucky – 42nd ($0.34 per capita) 

Only 2% of ODOT’s budget is dedicated to public transportation, which is why the department’s own 2014 Transit Needs Study found that current service does not meet demand. Ohio’s peer states dedicate between 10-20% of their state transportation budgets to transit and the state needs to do much to make up for this deficiency. Public transportation is critical to a number of sectors in Ohio, including the elderly, disabled, and is a key component in successfully supporting the state’s priority of job creation, job growth, and workforce development.

We thank Director Wray for his leadership on this issue. Through his efforts and those of the team at the Ohio Department of Transportation, the governor’s budget proposed a substantial increase in funding for public transportation over the next two years. However, as the ODOT Transit Needs Study acknowledged, the backlog of capital needs is great and will require substantial support. There are several ways to address that gap.

Increase Federal Highway Administration Funding for Public Transportation

One option, which involves a simple reprioritization of goals and projects at the Department of Transportation is the idea of flexing Federal Highway Administration (FHWA) dollars.

Flexing FHWA dollars reallocated federal funding Ohio already receives. At present, the state flexes around $23 million per year for public transportation purposes. House Bill 26 proposes to increase this amount by $10 million per year, to $33 million annually. This is a significant increase in funding and we applaud the move by the administration to increase this support, which will help support the purchase of new rural transit vans and full sized buses.

Greater Ohio Policy Center believes that this support would be greatly enhanced with a commitment by the legislature and Department of Transportation to flex an additional $17 million annually, boosting the total amount of flexed FHWA dollars to $50 million per year of the biennium. Doing so will not adversely impact ODOT and its primary mission, as outlined recently by Director Wray in his testimony to the House Finance Committee, which is to “to take care of what we have.”

Setting aside a total of $50 million in FHWA funding to public transit will result in 7.5 fewer miles of highway expansion, or 24 miles of highway repaired per year. For perspective, ODOT paved 5,564 lane miles in 2015.

Allocating $50 million per year of FHWA fund to transit-related capital investments will have negligible impact on Ohio’s crucial highway maintenance and construction programs, while significantly improving safety, performance, and use of Ohio’s public transportation systems.

Create a Dedicated Funding Stream for Public Transportation

Flexing FHWA funding is just one option Ohio has to support Ohio’s public transportation network. Another option, which will require action on the part of the legislature, is to create a dedicated funding stream for public transportation.

Nationwide, 25 states along with the District of Columbia dedicate fees and taxes for the exclusive use of public transit. This, in turn, provides a relatively reliable source of assured funding for these systems. While local transit systems can seek support for dedicated sales tax funding from local voters, it is still not sufficient to meet all needs, and thus most systems rely on funding from the state.

There are several possible sources Ohio could dedicate to support transit-related equipment and vehicle investments; examples of potential funding sources include. At Greater Ohio, we believe Ohio should consider dedicated funding derived from the sales tax collected on rental vehicles, a revenue source that is largely paid by out-of-state visitors to Ohio. By dispersing the equivalent amount of sales tax collected on rental vehicles to fund public transportation, Ohio would take a major step forward in assisting Ohio’s existing transit systems modernize and expand to meet the growing demands for service statewide.

There are other options available beyond the rental vehicle sales tax, including a tax on motor vehicle sales or a fee on the sale of new tires, among others. Regardless of the source, dedicated funding is an important and necessary step forward if Ohio is to have a modern, competitive system.

Dedicated funding for capital improvements will increase the safety and reach of Ohio’s transit agencies. In addition, dedicated funding will help to expand Ohio’s existing transit services, including helping to reach residents in the 27 mostly rural counties that lack access to any form of public transportation.

Adopt and Implement a Statewide Active Transportation Policy

Public transportation is just one aspect of a robust transportation network which Ohioans have come to expect and rely upon. But as we near the beginning of the third decade of the 21st Century, we must look beyond four wheeled transportation as being the sole aspect of the transportation network.
Every day in Ohio, 2 pedestrians and 1 bicyclist dies or is seriously injured in roadway accidents.

Nationally, elderly people and children are at greater risk of pedestrian fatalities than other age groups. A 2015 analysis of 37 active transportation projects across the country determined the projects avoided a total of $18.1 million in collision and injury costs in one year alone. An active transportation policy that ensures state roadways and municipal streets that receive ODOT investment can be safely traveled by all users’ needs to be implemented.

Active transportation, by definition any human-powered transportation system such as walking or bicycling, is increasing in frequency across the state for a variety of reasons. Adoption of a policy that would be sensitive to context (rural vs. suburban vs. urban) and that would facilitate the safe and efficient movement of people and goods is key. At present, 33 states have an active transportation policy. Agencies such as ODOT and the Ohio Department of Health have been working on a policy for some time. I recently had the opportunity to share this plea with both the Joint Task Force on Transportation Issues and the Joint Education Oversight Committee, as part of its review of school transportation issues, and share it with you now in the hope that this committee will urge the department to pursue this policy on a statewide basis and ensure safe travel for all Ohioans.

Comprehensive Funding Reform of the ODOT Budget

As I have previously mentioned, Ohio is a key component in our national transportation network. Ohio’s interstate highway system is the 12th largest in the nation, and ranks 5th in overall traffic volume and 4th in truck traffic volume. Ohio boasts the 2nd largest inventory of bridges in the nation. Beyond roadways, Ohio also ranks 4th nationally in freight rail mileage, hosting 35 freight railroads and 5,305 miles of rail. Ohio’s maritime ports saw 48,267,276 short tons of cargo traded in 2013, and features 7 ports ranked in the top 100 nationally that year.

Yet, in spite of these impressive statistics, the American Society of Civil Engineers has graded Ohio’s 125,000 plus miles of roads a ‘D’, finding that 43% of the state’s roadways are in critical, poor, or fair condition. Of greater concern is a finding that 2,242 of the state’s 27,015 bridges (8% of total bridges), are ‘structurally deficient.’ The overall cost to motorists in the state, the personal cost of driving on roads in need of repair, is $3.3 billion per year, which amounts to $413 per motorist.

Adequately maintaining and upgrading all modes of transportation in Ohio is becoming a challenge, as there are not enough resources available to ensure this is done effectively. The cost of transportation materials and equipment has increased substantially in the last decade, while local, state and federal funds have flat-lined. This is not a problem that is unique to Ohio, and ODOT should be lauded for the work it has been able to accomplish in light of these challenges.

That said, Ohio needs to take a serious look at these challenges going forward, and can look close by to see an effective model that is meeting the needs of the public and private sector in a strategic manner.

In 2012, Pennsylvania had been found to have the most dire of infrastructure systems in the nation; the bridges were rated as the most structurally deficient, roadways were crumbling and there was a growing, unmet demand for public transportation. Through a comprehensive 5-year transportation budget package enacted in 2013, Pennsylvania is now producing $2.1 billion in additional funds and recalibrating resources to better support all modes of transportation. The state has now adopted a Fix-It-First Policy that focuses on funding repairs and maintenance programs on existing infrastructure, doing more to improve asset management and limiting capital expansions.

Like Ohio, Pennsylvania restricts its motor fuels tax to highways and bridges, so in order to provide for the needs of additional transportation modes like transit, rail, aviation, and maritime ports, the state instituted new fees and aggregates small increases on existing taxes and fees to provide additional funding to expand transit services, modernize ports and airports and generate additional revenue for traditional maintenance programs. Among these revenue generators were:

  • A new $1 fee on all new tires sold 
  • A higher fine for lapsed vehicle insurance in lieu of license suspension 
  • A flat $150 fine for disobeying traffic control devices 
  • A $2 per day vehicle rental fee 
  • A 3% vehicle lease tax 
  • A clear formula for assessing the gas tax on alternative fuel vehicles 
  • A switch from taxing at the pump to taxing “at the rack”

One of these elements is already included in House Bill 26. A provision in the bill moves the point at which the motor fuel tax is applied from the point when the fuel is received to, generally, the terminal or refinery rack, affecting who is required to report and pay the tax.

GOPC believes that other elements of the Pennsylvania reform package can and should be considered in Ohio, in order to ensure the state’s economic stability in the years ahead.

Conclusion

In conclusion, it is crucial that Ohio support and maintain a system supporting all modes of transportation. Such a robust, competitive system as outlined here today can serve as a blueprint for addressing our state’s critical infrastructure needs while simultaneously enhancing Ohio as a place where businesses can thrive and where people want to live.

Chairman McColley and members of the Transportation Subcommittee, thank you for your time and thoughtful consideration. I am happy to answer any questions you may have.

Southwest Ohio’s Pipeline H2O Launches Program for Upgrading Sewer and Water Infrastructure

January 31st, 2017

By Nick Livingston, GOPC High School Intern

Pipeline H2O, a water-based startup technology program located in Hamilton, Ohio, has just announced its first class of companies that are working on water infrastructure challenges. Pipeline H2O’s main objective is to acknowledge and advance the work of water technology companies improve water services and seek innovative strategies for reusing water, upgrading infrastructure, treating wastewater, and monitoring water quality. This timely news coincides with GOPC recently beginning the Implementation Phase of its Water Financing Project, providing recommendations on strengthening the long-term sustainability of water infrastructure in Ohio. 

At the end of the selection process, Pipeline H2O chose eight startup companies to begin the program, including two companies from Ohio: kW river Hydroelctric from Hamilton, and Searen from Cincinnati. Companies that have been selected to participate in the Pipeline H2O program exhibit through their work many of the strategies that GOPC recommends in its recent report, Strengthening Ohio’s Water Infrastructure: Financing and Policy. For instance, WEL Enterprise’s system that treats and reclaims wastewater on one platform is a strong example of developing new technologies in order to save energy costs, which is a strategy GOPC recommends in its report.  

GOPC‘s report also emphasizes the importance of asset management, which is the process of cost-effectively upgrading and maintaining assets. The companies selected for the Pipeline H20 program are efficient in maintaining resources and saving money while upgrading water quality, demonstrating sound asset management techniques.  For instance, the Aquatech startup Searen has created a Vacuum Airlift, which replaces legacy hardware and consolidates pieces of equipment. In addition, GOPC’s call for public-private partnership to make projects more flexible and timely can be seen through Pipeline H2O’s partnership with government agencies such as the United States Environmental Protection Agency, the City of Hamilton, and the City of Cincinnati.

Go Here to access GOPC’s latest report Strengthening Ohio’s Water Infrastructure: Financing and Policy and Here for more on Pipeline H20’s inaugural class of water technology companies

Pipeline H20’s assessment was handled by a committee composed of water experts, including Greater Cincinnati Water Works, the Metropolitan Sewer District of Greater Cincinnati, City of Hamilton Water, Confluence, Butler County Groundwater Consortium, U.S. EPA, Hamilton Mill, Cintrifuse, Village Capital, and Queen City Angels.  New and innovative ideas concerning water development will be introduced throughout the region from the selected companies, and the Pipeline H2O program will be set in action from February 2017 through May 2017.