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Discussion On Assignment #1

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DIS C USS ION ON AS SIGNMENT #1

• Question1. Imagine you are designing a comprehensive transportation plan for a newly


constructed university campus. What kind of travel and modal studies are required? Please
enumerate the data items to be collected in each of these surveys/studies and explain the use of
each data item in a tabular form.
 
• Question 2. Household travel surveys (HTS) help Metropolitan planning organizations (MPOs) and
state departments of transportation (DOTs) to better understand peoples' travel patterns and use
the results to update and/or calibrate their travel demand models. List data collected from
California Household Travel Survey and three recent household travel surveys. Summarize the
variables/data into a tabular form and discuss the advantages and limitations of each survey briefly.

• Question 3.  California Interregional Transportation Strategic Plan 2015 is available at the Caltrans
website. What are the different elements of California's Interregional Transportation System? Write
a short essay (1-2 page) on different highlighted projects in the plan that would greatly improve the
state’s transportation goals.
TYPICAL TRANSPORTATION PROBLEM
WHAT ARE STEPS TO SOLVE THIS
PROBLEM?
S AMPLE PROJECT TOPICS

• A grant for integrating different last-mile connection modes of


transportation
• A business plan for a new transportation mobile application
• Analysis of progress of existing regulation of near-term GHG
targets
• A tool for policy makers to evaluate different mobility options
• Evaluate a new policy of banning trucks on 1-5 during morning
and evening peak hours
TRANSPORTATION FUNDING &
FINANCING
KEY CONCEPTS

• Capital Expenditure – Expenditure on new infrastructure & equipment


• Operation & Maintenance Expenditure -- Recurring payments to cover the
cost of administration, operation, and normal maintenance and repair
• Discretionary Grants – Grants from government that are discretionary based
on benefits
• Transportation Improvement Program (TIP) -- A capital program listing the
committed investments for 4 or 5 years
• Impact Fees -- Fees charged to developers related to the infrastructure
improvements
• Public/Private Partnerships -- Formal or informal relationships among
government agencies and private entities
• Risk Analysis -- A systematic process to understand the nature of and deduce
the level of risk
• Trust Funds -- An account established by law in a treasury department to hold
tax receipts
T RA N S P O RTATI O N F U N D S O U RCE S & E X P E N D IT U R E S
MOTOR FUEL TAXES

• In the United States, motor fuel taxes are the primary source of
funds for transportation investment.
• Interstate system was constructed majorly funded with these and
they are in place since mid-1950s
• Highway Trust Fund:
• The gas tax receipts were to be deposited in the U.S. Treasury in a special
account
• These are dedicated to construction of mostly highways not other modes
• For example, the Michigan Transportation Fund (MTF) is contributed
by gas tax and vehicle registration fee
• These funds are distributed to the Michigan DOT (39.1 percent), counties
(39.1 percent), and cities and villages (21.8 percent)
• Federal and state gas tax revenues are spent to achieve specific
program goals, such as safety, economic development, congestion
relief, air quality improvement etc.
VMT FEE/MILEAGE BASED FEE

• If the consumption of motor fuel will decline, then


motor fuel tax revenues also diminish
• Charging vehicles for the use of the highway
network, most often defined as a VMT fee
• Use GPS or some other means to identify how
vehicles traveled
• Pilot studies are conducted in Oregon and other
countries like UK esp. trucks
• Caveat: People may complain about the privacy
issues
TOLLS

• High Occupancy Tolls (HOT)


• Single occupant vehicles can use the managed lane during peak periods for
a price that often varies by the level of congestion in the lane.
• Prices can be variable
• Debatable concept as higher income people afford and transportation equity
• Express Tolls
• Similar to HOT lane concept , whereas this lane can be used by all
automobiles
• No revenue loss due to violations
• Truck Only Tolls (TOT)
• Similar to HOT lane concept, but are dedicated to commercial vehicles.
• Most proposals have the lanes next to regular freeway lanes, but separated
with some form of barrier.
• E.g. Port of Long Beach, Port of LA
CORDON PRICING & PARKING CHARGES

• Cordon pricing
• The basic concept is that vehicles are charged a fee to enter a highly
congested area.
• London and Singapore has successful cordon pricing models
• Requires technical infrastructure
• E,g. New York City was considering a congestion charging scheme as part of
a federal demonstration program, but political considerations stopped the
initiative

• Parking Charges
• This helps to reduce congestion in central business district (CBD)
• It is easy to implement and can change driving behavior
• Different cities use this strategy to reduce congestion E.g. San Francisco adds
25% extra fee for commercial vehicles, Boston freezes parking in certain
neighborhoods in CBD, few California cities have “cash out “ program
VA LU E C A P T U R E & O T H E R I N C O M E

• Impact Fees—One-time charges collected by local governments from developers to


finance new infrastructure and services associated with the new development.
• Special Assessment District—An additional fee assessed on properties near a new
highway or transit facility that is expected to benefit from such proximity.
• Sales Tax District—Similar in concept to a special assessment district, the sales tax
district requires those benefiting from a transportation investment to pay a limited
sales tax instead of a property tax.
• Land Value Tax—A tax imposed on the value of land benefiting from transportation
infrastructure.
• Transportation Utility Fees—Utility fees assessed on the basis of characteristics of
travel demand, such as traffic volumes.
• Negotiated Exaction—A negotiated, one-time charge similar to impact fees, but not
determined a priori by a formula or impact ratios.
• California is using a carbon-based tax to raise revenues for some transportation
projects.
• Vehicle license/registration fees, weight fees/taxes, fines and forfeitures, property
leases and air rights, advertising (for transit, mainly), and development agreements.
TRANSPORTATION FINANCE STRATEGIES

• Transportation Financing
• The mechanism by which funds are made available for transportation investment.
• It describe the combination of different funding sources that together represent the investment
strategy for a region or state.

• Debt financing
• Very similar to a homeowner’s mortgage policy.
• The government borrows money from the municipal bond market at very low interest rates, and
then has to pay back the principal with interest over a set number of years.
• The advantage the large investment gaps can filled up with the influx of capital funds
• The major disadvantage is, the principal and interest have to be paid back over many years.
• Following criteria has to be considered
• Debt per capita, Debt as a percent of taxable property, Ratio of debt service expenditures to total
revenues.
• Ratio of debt service expenditures to all expenditures, Debt service coverage by pledged revenues.
• Another strategy being used by state DOTs is advance construction. This allows a state or
local agency to initiate a project using nonfederal funds while preserving the eligibility for
future federal aid.
PUBLIC PRIVATE PARTNERSHIPS

A public-private partnership is a contractual agreement formed between


public and private sector partners that allows more private sector
participation than traditional setup.
INVESTMENT PROGRAMMING AND PL ANNING

Transportation Improvement Program (STIP/TIP)


• Serve as a short-range implementation tool to address the goals of the regional
long-range transportation plan.
• Provide continuity of current transportation improvement projects with those
identified in previous TIPs.
• Identify transportation projects recommended for implementation by
transportation mode, type of improvement, funding source(s), and geographic
area.
• Estimate the costs of projects proposed for federal funding.
• Establish a prioritization of projects to effectively utilize federal funds as they
become available.
E S T I M AT I N G R E V E N U E S & C O S T S

• Revenues
• Planners must know the underlying funding sources and the
factors that influence the amount of revenue generated.
• Revenues depend upon demographics, vehicle registration,
fuel consumption, vehicle sales and retail sales etc.
• Forecasting indirect revenues is also important i.e.
penalties, tolls, traffic violations, interest on cash balances
etc.

• Costs
• Capital project costs and O&M costs
• Project cost estimation responsibilities vary by agency role
in project development
• Typically State DOTs are responsible for these costs, not
MPOs
• Most estimates of future O&M costs are simply escalations
of historic trends
FUTU RE CHALL ENGES

• The Future of Fuel Taxes – going to be lesser


• Bond Financing – Repayment eats up all the revenue
• Reliance on Non-Transportation-Related Tax Sources – Due to
uncertainty in economy, may be lesser revenue in future
• Geographic Equity for Statewide and Regional Sources --- More funds
are spent on bigger cities
• Connected and Autonomous Vehicles – Lesser drivers and more
infrastructure needs
• Cost Burden across User Groups --- Trucks vs Cars, cost burden is not
same

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