Virginia’s Infrastructure Needs Hurt Economic Development Efforts

For this week’s Guest Post Friday here at Construction Law Musings, we welcome a good friend, Andrew McRoberts.  Andrew is an attorney at SandsAnderson PC.  He focuses his work on land use and zoning, subdivision, real estate, tax assessment, special service districts, and other specialized advice and litigation for local governments in Virginia as well as for private clients needing a lawyer with local government experience and insight.  Andrew has built expertise in local government law his entire legal career. He is a popular speaker, and authored amicus briefs to the Virginia Supreme Court on behalf of the Local Government Attorneys of Virginia, Virginia Association of Counties and Virginia Municipal League.  Andrew is the managing editor and chief author of the Virginia Locality Law Blog on local government issues and legal information in Virginia.  You can follow Andrew on Twitter at @AndrewMcRoberts and @VaLocalityLaw.  In 2010, he was selected as a “Leader in the Law” by the Virginia Lawyer’s Weekly.

In the “Best Practices Construction Law” Blog, I read that the U.S. Department of Treasury recently released a study supporting significant new investment in public infrastructure, entitled, “An Economic Analysis of Infrastructure Investment.”

Reportedly, the Obama administration has been seeking as much as $50 billion in new money to invest in highways, bridges, rail and public transit as part of a new stimulus.

This federal study shines a light on the real costs of doing nothing. There is a cost to future economic development of a failure to invest in transportation.

Here are some of the parts of the study I found most interesting.

We spend less as a percentage of our wealth than other nations. According to the federal study, the U.S. now spends less than 2% of GPD on infrastructure, a 50% decrease from 1960. By comparison, nations such as China and some in Europe spend about 9% of their GDP on infrastructure.

We are less satisfied with our transportation systems. The American public’s satisfaction with public transit ranks 25th out of 32 OECD nations. No big surprise there. But despite our country’s tradition of road-building, our satisfaction with roads and highways ranks only 17th out of 32 — the middle of the pack.

In a Texas Transportation Institute (TTI) report on the costs of inadequate transportation infrastructure, based on a study of 439 urban areas (cited in the federal study):

• The overall cost (based on wasted fuel and lost productivity) reached $87.2 billion in 2007 – more than $750 for every U.S. traveler.
• The total amount of wasted fuel topped 2.8 billion gallons – three weeks’ worth of gas for every traveler.
• The amount of wasted time totaled 4.2 billion hours – nearly one full work week (or vacation week) for every traveler

Our local governments and their citizens see the needs — the deterorating roadways and bridges, the bottlenecks and gridlock, the lack of new roads and alternative transportation options. In Virginia, most counties have little control over the availability and expenditure of dollars to improve infrastructure. The only expenditures they have some control over, their slice of the shrinking state secondary road funds, have been cut to the bone. The “six year road plan” (a prioritization by the county of the expenditure of its slice of those funds) is a joke, and may be better described as a “sixteen year road plan” or the “pipedream of a road plan.” If that. Municipalities have seen similar cuts in their allocation for roads. The recent federal stimulus helped for a few specific projects, but was a short-term shot in the arm.  Long-term needs are still ignored.

And there is another, more aesthetic angle. Over the last year, due to lack of VDOT funding, many highways of Virginia have looked more like overgrown farmer’s fields. What effect does this have on investment in Virginia and on tourism?

Simply put:  The Commonwealth has responsibility to give its citizens and businesses a proper transportation system, but apparently has inadequate revenue to do the job.

Local governments, businesses and commuting citizens see the problem and feel the pain. They look to the state and federal government to solve the problem. But will they?

Andrew and I welcome your comments below.  Also, please subscribe to keep up with this and other Guest Post Friday Musings.