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These are the issues confronting us today. Those in government, enamored with their own arrogance and complete failure to be held accountable by the tens of thousands they would damage, are well-aware of all; of these things.
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But they don't give a damn what we need, or what we want.
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These despicable scum who demand this steaming pile be built do so with the certain knowledge that THEY won't have to pay for it... but WE will.
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How's THAT for a "rant," Lou?
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Portland Considers Buying A McMansion-style Highway Bridge
We’re all smarting from the economic recession that’s hurt our incomes and job prospects, from the decline in housing values that’s dented our wealth, and the collapse in financial markets that’s dealt a big setback to our retirement plans. We’re smarting, but, we tell ourselves, we’re smarter, too.
We’ve learned key lessons. We won’t be fooled by the Bernie Madoffs, or by claims that house prices can only go up, or that some form of complex mortgage-backed security can eliminate financial risk, or that stated-income “liar loans” were ever a good idea. At a high price, we’ve bought ourselves some very valuable lessons.
Next time, we tell ourselves, we’ll be smarter. We’ll ask the hard questions — before we sign on the dotted line. We won’t be conned by overly optimistic estimates or take some self-interested experts’ assurances at face value.
But are we really smarter? I live in the area of Portland, Oregon, and here we face the biggest public investment decision in decades. And it’s a reprise of the oldest con-game in the nation: “Hey, buddy, do you want to buy that bridge?”
In this case, the bridge is the proposed Columbia River Crossing. With an estimated price tag of $4 billion, this proposed five-mile, 12-lane freeway would be the most expensive public works project in the region’s history. The cost works out to more than $8,000 for each four-person household in the region or roughly the equivalent of 80 OHSU trams.
So far, like frenzied homebuyers a few years back, many bridge advocates seem chiefly concerned with superficial questions, such as whether the bridge will be pretty. But before we sign on the dotted line, we–and cities across the country that are considering similar investments–ought to be asking the kind of questions that will keep us from repeating the worst mistakes of those caught up in the housing bubble.
First and foremost, who will pay for this bridge?
Project proponents have vaguely promised that funding will come from a mix of federal and state sources, but there is little indication of any of this will materialize. Congressional leaders, including Washington’s Brian Baird and Oregon’s Peter DeFazio, have warned against expecting federal earmarks that would cover more than 10 percent of the cost of the bridge. The Oregon Legislature, meanwhile, approved gas tax and vehicle registration fee increases and earmarked nearly $1 billion for highway projects, but allocated not one dollar to the Columbia River Crossing.
There is no special pot of money for the Columbia River Crossing — it will take away dollars that we could use for other regional projects. Every penny we spend tearing down the existing I-5 bridges and building a new 12-lane freeway bridge is money we can’t spend somewhere else in the region.
To paraphrase John Donne, ask not for whom the bridge is tolled, it is tolled for thee. Any new Columbia River Crossing will require a substantial toll, not just on I-5, but on the I-205 bridge as well — otherwise traffic would divert from I-5 to avoid tolls there.
In the height of the housing boom, lots of buyers rationalized mortgages they couldn’t afford for houses bigger than they needed based on the belief that housing prices could only go up.
Highway advocates have a similar delusion — that traffic levels can only increase. But that’s not true. Driving has been going down in Portland, a trend that started even before the run-up in gas prices and the recession. Traffic counts have been going down on the Interstate bridges for the past three years. And according to Inrix, the nation’s leading providing of real-time traffic information, afternoon peak-hour congestion on I-5 northbound has declined more than 10 percent in the past year. If traffic levels flat-line, or grow much more slowly than in the past — as now seems certain to be the case, thanks to higher gas prices — we simply don’t need 12 lanes of capacity, plus light rail.
Projections of continually increasing traffic are not simply a justification for a bigger bridge, they are essential to paying for it. Because any new bridge will require tolls, the amount of toll revenue hinges directly on the number of people who cross the bridge. If fewer people use the bridge than predicted, then the bridge will need a bailout.
Not only are toll revenue forecasts notoriously over-optimistic — like rating agency estimates of likely default rates on subprime loans–but across the country, toll revenues are declining in the face of the recession and changing driving habits.
Historically, for the most part, we’ve relied on a “pay as you go” model for transportation finance. But the Columbia River Crossing turns that model on its head, and would likely require borrowing three-quarters or more of the cost of the bridge. Borrowing $3 billion for the project would necessitate annual interest payments of $180 million in the initial years of the project — money that would not be available for other transportation projects. And like the sales pitch for that sub-prime mortgage, the $4 billion price tag doesn’t include the cost of these interest payments.
And finally, no one should trust that this megaproject can be completed under budget. ODOT’s current largest highway project, the widening of a five-mile stretch of U.S. 20 between Corvallis and Newport, is 33 percent over budget. The OHSU Tram ended up costing triple its original estimated price. Even a 25 percent overrun on the Columbia River Crossing would end up adding a billion dollars to the price.
If we’ve learned any hard lessons from the past year about borrowing money, now is the time to put that learning to work. We need to demand a financial plan for this bridge that spells out who pays, and how much. We need independent accurate estimates — based on a world of $3 or $4 per gallon gas, global warming, and declining vehicle travel –and of how much traffic will use the bridge, especially with a toll of as much as $5.
And we should really ask whether, if we really have $4 billion to spend on the region’s transportation infrastructure, we ought to spend so much of it in one place, to facilitate more peak-hour commuting and suburban sprawl.
The current I-5 bridges are like a homely 1920s bungalow: Timeworn and out of fashion, yes, but sturdy and paid for. Rather than take out a huge mortgage to tear them down to build a glitzy new McMansion of a bridge, we ought to look at fixing them up at a fraction of the price.
The work of the project’s consultants is too reminiscent of the glossy real estate brochure providing only the most cursory examination of these risks, making implausibly optimistic assumptions, and doing nothing to quantify the consequences of error. The region’s elected officials and citizens should insist on real due diligence on these risks — preferably from parties completely independent of the project — before mortgaging our region’s future for a bridge we don’t need and can’t afford.
Joe Cortright is president and principal economist with Impresa, a Portland consulting firm, and chair of the Oregon Governor’s Council of Economic Advisors. He is also the chief economic analyst for CEOs for Cities, a national organization of urban leaders.
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