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Posts from the Boondoggles Category

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How the Lure of Spending Keeps Dumb Highway Projects Alive

Decades ago, Ohio officials drew a line on a map — the Eastern Corridor, a highway for commuters living in Cincinnati’s eastern suburbs. No matter how much time has passed and how little sense it makes to build that highway today, that line can still seem like destiny.

An image used by the village of Newton to oppose the Ohio Department of Transportation's $1.4 billion Eastern Corridor highway plan. Image: Village of Newton

This is the message from the village of Newtown about the Ohio Department of Transportation’s $1.4 billion Eastern Corridor highway plan. Image: Village of Newtown

The Eastern Corridor began as a 1960s vision for a highway connecting bedroom communities in mostly rural Clermont County to downtown Cincinnati, roughly 17 miles away. There is not much appetite for it: As soon as Ohio DOT dusted off its plans and started laying the groundwork to build this $1.4 billion project in 2011, communities along the corridor revolted.

The project lives on anyway. Last week, it seemed like state legislators were poised to reject the highway, but the thought of turning down a big construction project — no matter how wasteful and unwanted — was too much for some lawmakers to bear. The Eastern Corridor remains a looming possibility, a case study in how highway projects can develop a nearly unstoppable political momentum.

The outcry against the Easter Corridor has been growing since the moment ODOT told the public what it wanted to build. Along almost every section of the planned road, residents, neighborhoods, and whole towns tried to stop the project.

The most fiercely opposed sections involve rerouting State Route 32 through Newtown and Mariemont — two small, relatively affluent inner-ring suburbs. The road would cut through the heart of tiny Newtown, where the leadership is adamantly opposed, saying it will destroy the town’s business center. In Mariemont, it would ruin a park referred to as the South 80.

The Eastern Corridor also calls for a poorly-conceived rail line, expected to cost as much as $600 million and draw as few as 3,000 daily riders. The region’s rail advocates oppose it, calling it a waste of money.

Even farther away suburbs are not exactly thrilled about the highway. Andersen Township Trustee Russell Jackson told the Cincinnati Enquirer that “nobody in the local communities really sees this incredible benefit to building this thing.”

There are pockets of support for the project, including rural Clermont County, but overall, public opinion against the Eastern Corridor appears to be strong enough to sink it. Jason Williams at the Enquirer wondered last week if it was “on life support.”

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Cincinnati’s Highway Revolt on the Verge of Victory

Ohio State Rep. Tom Brinkman, a Republican who believes in lower taxes, is taking a principled stance against a wasteful highway project. Photo: Wikipedia

Ohio State Rep. Tom Brinkman, a Republican who believes in lower taxes, is taking a principled stance against a wasteful highway project. Photo: Wikipedia

Could the end be near for the $1.4 billion Eastern Corridor highway project proposed for eastern Cincinnati? Language added to Ohio’s transportation budget, which is being debated right now, would specifically “prohibit [Ohio DOT] from funding the Eastern Corridor Project in Hamilton County.”

The amendment was introduced by Republican state lawmaker Tom Brinkman, who represents an eastern portion of Cincinnati. Brinkman told the Cincinnati Enquirer, “I am representing constituents who say, ‘We don’t want to tear down our communities.'” The boondoggle highway project is opposed by residents in Newton, Mariemont, Madisonville, and other towns east of Cincinnati.

The highway does have its defenders in the legislature. At a House Finance Committee meeting Monday, Democrat Denise Driehaus, who represents Cincinnati, signaled her concerns about Brinkman’s amendment.

“It’s been going on for about a decade and so there has been significant investment at both the state and local level,” she said. “It seems to me this sets a precedent that the legislature prohibits ODOT from spending on a local project that has been vetted locally.”

Ryan Smith, a Republican from southeastern Ohio, countered: “This project has gone on for a decade but I think everyone can agree that heading down the wrong path and continuing down the wrong path may be problematic.” As to whether it would represent some kind of dangerous precedent for elected leaders to direct state transportation officials not to fund specific projects, he said, “This is the first time I can remember somebody asking not to be funded on a project.” (For what it’s worth, Governor Kasich added legislation to a previous budget that forbid state money from being spent on the Cincinnati Streetcar.)

You can watch the exchange between Driehaus and Smith here at about the 8:30 mark.

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Wisconsin Dumps One Urban Highway Boondoggle in Favor of Another

Wisconsin Department of Transportation rendering of their proposed, but now rejected, plan for a double decker freeway in Milwaukee.

Instead of spending $1 billion to create this double-decker section of I-94 in Milwaukee, Wisconsin DOT will spend $850 million to widen the highway. Rendering: WisDOT via Milwaukee Business Journal

One of the nation’s most poorly conceived highway proposals will become slightly less ridiculous. Transportation officials in Wisconsin recently announced they will no longer consider double-decking a portion of Interstate 94 in Milwaukee. The billion-dollar project would have raised the highway to building height in the Story Hill neighborhood.

Wisconsin DOT hasn’t seen the light, however. The state is still marching ahead with a tremendously expensive I-94 expansion project. Instead of spending $1 billion to double-deck the highway, WisDOT has settled on spending $850 million to repair the road and add a lane in each direction.

For comparison, the project will still cost about three times what Governor Scott Walker cut from state support for the University of Wisconsin in his recent budget. The road expansion is designed to save commuters just four minutes in each direction — assuming the state’s traffic assumptions are correct.

But there is very good reason to believe they are not. State officials are using old traffic data to justify the enormous expense. Traffic counts on the corridor actually declined between 2009 and 2012, the latest years for which data was available, according to an analysis by the Wisconsin Public Interest Research Group.

The data Wisconsin DOT cites to justify the project only extends through 2010. The agency says that’s because a later construction project affected traffic levels on the road. But Metro Milwaukee’s population has barely increased in a decade, and statewide, driving has been flat since 1999, so it’s not at all clear why the state would be expecting such an increase.

“Rather than fixing it first and prioritizing the maintenance of our existing roads and bridges, the DOT wants to widen a highway where traffic counts have declined by 8 percent over the past 12 years,” said WISPIRG Director Peter Skopec in a press release.

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Talkin’ Infrastructure With Chuck Marohn, Mike McGinn, and Kevin Shephard

Last week, Chuck Marohn of Strong Towns hosted a video panel to discuss a very hot topic: How America’s infrastructure got to be in such bad shape.

This “Friday News Discussion” featured former Seattle Mayor Mike McGinn, Kevin Shepard, a Texas-based professional engineer and principal at the firm Verdunity, and me, representing Streetsblog.

It was especially interesting to hear a former mayor’s take on these issues and what cities can do to resist the pressure to back wasteful megaprojects like Seattle’s disastrous deep-bore tunnel, which McGinn paid a political price for opposing.

If you’re not already plugged into these talks at Strong Towns or some of their other great work, you ought to check it out.

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The Final Nail? Indiana Gov Says Illiana Expressway Boondoggle “On Hold”

A rendering of the Illiana. Via Parsons Brinkerhoff

The Illiana would run through sparsely populated areas and cost billions. Is it truly dead? Rendering: Parsons Brinckerhoff

Yesterday, the Indiana Department of Transportation (INDOT), under the leadership of Governor Mike Pence, joined newly elected Illinois Governor Bruce Rauner and the Illinois Department of Transportation (IDOT) in putting his state’s commitment to the Illiana Expressway project on hold.

The Illiana would run through cornfields and cost as much as $3 billion to build, putting taxpayers at risk of bailing out an unnecessary road while crowding out other transportation priorities.

A year ago, the highway was a top priority for former Illinois Governor Pat Quinn and seemed inevitable. Rauner’s election has reversed the momentum, but the question remains: What needs to happen to kill the Illiana boondoggle? It’s clear what’s necessary for a proposed highway to be completely approved and funded, but how does a proposed project finally die?

There are many good reasons people aren’t embracing the Illiana. The private financing that taxpayers had been led to believe would cover the cost of the project was a mirage. IDOT sweetened the deal for its private partners, promising road builders a set amount of scheduled payments no matter the level of toll revenue. In other words, the public was on the hook for any shortfall.

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Can Seattle Stop Its Highway Tunnel Boondoggle Before It’s Too Late?

Is it too late for Bertha? Photo: WsDOT

Seattle and the state of Washington have a window of opportunity to stop throwing good money after bad. Photo: WsDOT

It’s been one year since the world’s largest tunnel boring machine, “Bertha,” got stuck 120 feet beneath Seattle. Before it broke down, the colossal machine had excavated just 1,000 feet of the two-mile tube that’s supposed to house a new, $3.1 billion underground highway to replace an aging elevated road called the Alaskan Way Viaduct.

Bertha hasn’t budged an inch in the 12 months since. Meanwhile, the bad news keeps on piling up.

Right now, the state’s contractor is busy building a second tunnel down to the machine, so that parts can be removed, repaired, and replaced. In order to keep the second tunnel dry, construction crews have been draining the water table. This work has dangerously destabilized the very elevated highway the tunnel is supposed to replace, and one of the city’s historic neighborhoods — Pioneer Square — is actually sinking as well.

As David Roberts detailed in a recent Grist story, the project could impose billions of dollars in cost overruns on the public. Nobody is certain the machine can be fixed, or if it does get fixed, whether the same problem won’t occur again, farther down its path. In December, the deep-bore tunnel ran away with the voting for Streetsblog’s “Highway Boondoggle of the Year” award.

If there’s anything positive to emerge from the current mess, it’s that local advocates like Cary Moon, who warned against building the tunnel in the first place, are commanding attention again. Moon recently took to the pages of the local alt-weekly, the Stranger, to argue that in light of the tunnel project’s spectacular, slow-motion meltdown, the city should explore other options.

We reached out to her to learn more.

This is a pretty big disaster, it sounds like.

This project identified a lot of risks at the beginning of the process, but the political commitment to it was already high enough at that point that no one really paid that much attention, except for several of us.

They treated us like we were gadflies instead of pointing out honestly and clearly what was probably going to happen. It’s frustrating because all this was known then but no one was listening.

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The Great Traffic Projection Swindle

This is the final piece in a three-part series about privately-financed roads. In the first two parts of this series, we looked at the Indiana Toll Road as an example of the growth in privately financed highways, and how financial firms can turn these assets into profits, even if the road itself is a big money loser. In this piece, we examine the shaky assumptions that toll road investments are based on, and how that is putting the public at risk.

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A consultant predicted traffic on the Indiana Toll Road would rise 22 percent in seven years. Instead, traffic fell 11 percent in eight years. Photo: Jimmy Emerson/Flickr

For privately financed toll road deals, traffic projections are critical. These forecasts tell investors how much revenue a road will generate, and thus whether they should buy a stake in it, and what price to pay. While traffic projections have underpinned the rapid growth in privately financed highways, the forecasts have a dismal track record, consistently overstating the number of drivers who will pay to use a road.

Private toll roads have been sold to the public as a surefire something-for-nothing bargain — new infrastructure with no taxes — but it turns out that the risk for taxpayers is actually substantial. The firms performing traffic projections have strong incentives to inflate the numbers. And the new breed of private finance deals are structured so that when the forecasts turn out wrong, the public incurs major losses.

Given the large sums of money involved, even small errors in traffic projections can result in huge problems down the line — and, as Streetsblog has reported, traffic projections everywhere have tended to be wildly off-target. A whole financing scheme, meant to last for generations, can easily be sunk in just a few years by exaggerated traffic projections. The Indiana Toll Road, purchased in 2006 for $3.8 billion, is a great example. The firm that owned it, ITR Concession Co. LLC, declared bankruptcy in September.

Wilbur Smith Associates had predicted that traffic volumes on the Indiana Toll Road would increase at a rate of 22 percent over the first seven years. Instead, traffic volumes shrank 11 percent in the first eight. The result was financial disaster for the concession company, owned jointly by Australian firm Macquarie and Spanish firm Ferrovial. By the time they filed for Chapter 11, debt on the road had ballooned to $5.8 billion.

The company blamed the recession for putting a damper on truck traffic. The same story was offered on another bankrupt Macquarie-owned project, San Diego’s South Bay Expressway. But is that explanation sufficient?

UK-based consultant Robert Bain literally wrote the book on traffic projections, warning in 2009 against forecasters who blamed faulty predictions on the economy [PDF]. Commenting on the flurry of global toll highway bankruptcies that was just starting then, Bain said they had “less to do with the present economic climate, and more to do with a market readiness to be seduced by hopelessly optimistic traffic and revenue projections.”

Bain went on to list 21 ways in which forecasters systematically overestimate future traffic. Each one may tilt the forecast by a tiny amount, but cumulatively they result in significant errors. Some of the typical mistakes indicate that forecasters have not yet acknowledged the broader decline in driving and sprawl underway, while others “underestimate the reluctance of some to paying tolls.” Bain argued for a paradigm shift in the use of traffic projections, recognizing that many of them “resemble statements of advocacy rather than unbiased predictions.”

Phineas Baxandall, a senior researcher with the U.S. Public Interest Research Group who’s written extensively for Streetsblog on trends in driving, says the engineering firms that provide the figures know how things work. “Companies seeking investment for privatized toll roads shop for the forecasting they want,” he said. “[There’s] no incentive to tell bad news. And if the deal appears promising, then the forecasting company gets other opportunities to sell further analysis, legal advice, raising debt, selling equity, etc.”

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Study: Corrupt States Spend More on Highways

In states with higher levels of corruption, public officials spend more on construction, roads and safety services. Image: Public Administration Review via Governing

A new study found a link between highway spending and official corruption. Map: Public Administration Review via Governing

A new academic study helps explain the enduring political popularity of expensive transportation boondoggles like Birmingham’s $4.7 billion Northern Beltline and Kentucky’s $2.6 billion Ohio River Bridges.

According to research published in the journal Public Administration Review, states with higher levels of public corruption spend more money on highways and construction. The study found highway and construction projects and police programs provide the most opportunities for lawmakers to enrich themselves, according to Governing Magazine, and are positively correlated with state levels of corruption. Meanwhile, highly corrupt states also spend relatively less on health, education, and welfare — categories that were less susceptible to graft and bribery, the report found.

Public corruption for each state was ranked based on 25,000 convictions between 1976 and 2008. Overall, the authors found, the 10 most corrupt states spend $1,300 more per person annually than the average state.

Streetsblog.net
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Washington DOT Chief: Seattle’s Big Highway Tunnel Might Not Get Built

"Bertha," the digging machine that was to help build a buried highway in Seattle is broken down and might never get running. Photo: Washington State Department of Transportation

“Bertha,” the tunneling machine that’s supposed to clear the way for an underground highway in Seattle, might never get up and running again. Photo: Washington State DOT

Nearly five months after coming to a halt beneath the city of Seattle, Bertha — the largest tunnel boring machine in the world — is still immobilized. It had barely begun to clear space for the underground highway meant to replace the aging Alaskan Way Viaduct when it broke down late last year.

Construction crews are furiously digging a second hole in the ground to access Bertha and fix it. What happens when they reach the machine is still uncertain. Even the state’s top transportation official admits theres a “small possibility” that the highway tunnel might never be completed, reports Erica C. Barnett at SeattleMet :

On conservative host Dori Monson’s show on KIRO radio earlier today, state transportation secretary Lynn Peterson sounded this wakeup call: She acknowledged, surprisingly candidly, that there is a “small possibility” that the deep-bore tunnel will never get built. The only scenario in which that might happen, she added, is if the contractor, Seattle Tunnel Partners, and WSDOT discover that “the machine is not going to actually be fixable.”

“I would say it’s a small possibility, but we want to make sure that everyone understands that it’s a possibility.”

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Grassroots Efforts “Crushed” by Louisville’s $2.6 Billion Bridge Boondoggle

State leaders in Kentucky want to build this $2.6 billion monstrosity right next to downtown Louisville. Image: ##http://8664.org/mt-static/8664/demo/1578/1578_8664ORG_Crossroads.html## 8668##

State leaders in Kentucky wants to build this $2.6 billion monstrosity next to downtown Louisville. Image: 8664

At $2.6 billion, the Ohio River Bridges project in Louisville, Kentucky, is the costliest in the state’s history. It includes 18 elevated lanes, two enormously expensive bridges, a mammoth raised interchange, and a $225 million tunnel under an undeveloped suburban property (“Indiana’s Big Dig“).

For years, Louisville residents J.C. Stites and Tyler Allen fought for a more humane, down-to-earth solution. Their plan — 8664 (short for “Remove I-64″) — proposed tearing down the elevated portion of the highway that stands between downtown Louisville and the Ohio River waterfront, to help integrate this mega-project into its surroundings. But it seems their fight may be over.

For a while it seemed Stites and Allen were getting somewhere. More than 11,000 people signaled support for the pair’s highway-to-boulevard proposal at 8664.org. (This short video illustrates their proposed alternative.) Though the pair built a large grassroots organization to back the highway teardown plan, enthusiasm for the 8664 project never translated to political muscle.

“They crushed us,” Allen says.

This week, on short notice, state lawmakers approved $753 million in bonding for the Ohio River Bridges project, which they hope to fund partly with tolls. The bonds were rated BBB, just barely investment grade. The project also expects to receive a $452 million federal TIFIA loan, according to Business First in Louisville.

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