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65 APPEN D I X A Summaries of Freight Performance Information for National Report Card Performance Summaries

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66 CONTENTS 67 Introduction 67 Freight Demand Measures 67 Freight Volumes, All Modes 68 Truck Freight Volumes 68 Rail Freight Volumes 69 Inland Water Freight 70Containerized Imports/Exports 72 Freight Efficiency Measures 72 Interstate Highway Speeds 73 Interstate Highway Reliability Measure 75 Trend Line of Top Interstate Bottlenecks 77 Composite Class I RR Operating Speed 78 Rail Freight Market Share of Ton Miles 79 Logistics as a Percentage of GDP 81 Freight System Condition Indicators 81 NHS Bridge Structural Deficiencies 81 NHS Pavement Conditions 83 Freight Environmental Measures 83Truck Emissions 84Particulates 85Truck NOx Emissions 85VOCs 85Greenhouse Emissions 87 Rail-Produced Greenhouse Gas Emission 88 Water-Produced Greenhouse Gas Emissions 88 Rail VOCs and NOx 89Ship NOx 90 Freight Safety Measures 90 Truck Injury and Fatal Crash Rates 91 HighwayRail At-Grade Incidents 92 Freight Investment Measures 92 Investment to Sustain NHS 92 Rail Industry Cost of Capital 94 Estimated Capital to Sustain Rail Market Share 94 Investment to Sustain Inland Waterway System 94 Endnotes

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67 Introduction Freight Volumes, All Modes The following section presents summaries of freight per- Freight Performance Trend: Increasing formance information that would support each individual Volumes performance measure from the Freight System Report Card I nfluencing all other freight performance trends has at the national level. The framework is proposed to serve as been and likely will continue to be the steady growth a Web-based tool. Each line of the report card would link to in overall freight volumes over the long term. The the summary information that is presented on the following slight decline in actual volumes in the past 18 months pages. In addition, more extensive source documents would is in sharp contrast to a steady, continuous increase in be linked from the summary report to provide the reader with freight volumes overall since at least the 1960s. Between additional detail and analysis. Reports such as the Council of 1984 and 2004, ton-miles for both trucks and rail rose Supply Chain Management Professionals (CSCMP) report, approximately 85 percent in the United States. the FHWA Condition and Performance report, or EPA air- The Freight Analysis Framework (FAF) forecast quality analyses would be the types of supporting documen- depicted in Figure A.1 is based on composite forecasts tation provided as supplemental links. The intent of the for- that are updated comprehensively every five years and mat is to provide summary, high-level information with the updated provisionally annually. The FAF forecast pre- ability for the user to drill down into more detailed analysis if dicts a steady 2.03 percent rate of growth in freight it is desired. In some cases, one succinct document provides volumes overall through 2035. Being a long-term esti- the needed context. In other cases, a variety of links may be mate, the actual rate of growth will vary year to year. needed to provide the reader with sufficient summary infor- The long-term forecast is based on best available esti- mation. Although the reliance on supplemental reports does mates, which account for the rate of economic growth, not provide uniformity to the reader, the reliance is unavoid- changes in sectors of the economy, and the influence of able at this stage of national freight performance measure- imports and exports. The relative mode splits remain ment. Consistently produced detailed analysis for each per- relatively similar through 2035 according to the FAF formance trend does not exist; therefore, the initial proposed forecasts, with truck and rail volumes both growing framework opportunistically uses what sources are available. at approximately 2 percent annually, with water at 1.5 The summaries on the following pages are for national percent with one major exception. Intermodal move- measures. Appendix B provides summaries for the regional ments of imports grow at a significantly faster rate than case studies, which are of Washington State and the Seattle other types of movements. This FAF table (Table A.1) metropolitan area. The two sets of summaries illustrate how estimates freight volumes by dollar value. Intermodal the national report card could be replicated at state and movements of imports rise from $716 billion in 2002 to metropolitan levels. $3,708 billion by 2035, a more than five-fold increase. This reflects U.S. export imbalances and increased glo- Freight Demand Measures balization of the economy. This import growth will affect most significantly the major container ports, rail Following are the measures for the category of Freight movements, and truck/rail movements. Demand. Freight Volumes, All Modes Figure A.1. Figure A.1.Freight volumes, Freight all modes. volumes, all modes. Freight Performance Trend: Increasing Volumes Influencing all other freight performance trends has been and likely will continue to be the steady growth in overall freight volumes over the long term. The slight decline in actual volumes in the past 18 months is in sharp contrast to a steady, continuous increase in freight volumes overall since at least the 1960s. Between 1984 and 2004, ton miles for both trucks and rail rose approximately 85 percent in the United States.

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68 Table A.1. Freight volumes by value (billions of dollars). Truck Freight Volumes freight volumes, tonnage hauled by trucks is expected to grow in the long term, driven by population growth and increased Freight Performance Trend: Increasing Truck economic activity. Volumes As illustrated in Figure A.2, truck volumes are predicted to Rail Freight Volumes sustain steady growth on the national level.1 The growth is posi- Freight Performance Trend: Increasing tive as an indicator of long-term economic health but creates additional pressures on the highway network. Though the cur- Rail freight volumes are expected to increase overall rent economic environment has reduced truck freight volumes in through 2020, putting increasing pressure on an already con- 2009, long-term growth for the Truckload (TL) and Less-Than- gested national rail network (see Figure A.3). The source of Truckload (LTL) sectors are expected. In general, LTL annual the rail forecast is the next generation Freight Analysis Frame- growth rates are forecast to remain higher than TL growth rates. work FAF2 database. FAF2 freight flow origin and destination Between 2009 and 2014, the annual rate of growth for the LTL (O-D) coverage spans 131 freight analysis zones that include sector is slightly above 2.5 percent per year, and beginning in 114 freight O-D zones and 17 major ports, border cross- 2015, the annual rate of growth is forecast to increase to over ings, and freight ports. The FAF2 commodity flow data are 3.5 percent. benchmarked to 2002 and are forecasted to 2035. This analy- The TL sector, the predominant industry sector, is expected to sis of the rail forecast utilizes the 2008 values and the 2035 increase at a slightly slower pace. Tonnage hauled by this sector estimates. The rail information is available for all transport is forecast to increase nearly 2.5 percent per year until 2014, then and then divided into three potential submarkets: domestic, experience a higher annual growth rate between 2015 and 2020. border crossings, and sea movements. Table A.2 presents the The Pacific region (which includes Alaska, California, Hawaii, 2008 and 2035 values for the rail mode.3 The forecast esti- Oregon, and Washington) experienced an increase in the per- mates that total rail traffic will increase by just under 2 per- centage of total U.S. tonnage of primary shipments originating cent annually. This increase is present even with an estimated in this region from 13.6 percent in 2002 to 14.6 percent in 2007. decrease in rail traffic for origindestination pairs involving It should be noted that the economic conditions and tonnage sea traffic, with such traffic estimated to decrease by 1.4 per- of shipments hauled by trucks originating in California signifi- cent. Domestic rail movements represent the highest growth, cantly impacts these regional metrics. at an estimate of 2.1 percent. The ATA forecast estimates that trucks will haul 13.3 billion The forecast rate of freight growth by mode may be defined tons in 2020. FHWA's FAF forecasts that by 2035 trucks will haul as the estimated percentage increase in tonnage hauled in 22.8 billion tons of freight.2 future years for the major modes of freight transportation. The severity of the recent challenging economic environment Baseline figures and forecast tonnage figures are limited to and rapid decline in freight volumes for all modes was largely primary shipments (primary shipments are defined as those unanticipated by most industry experts. Though most sectors handled the first time). This measure estimates the rate of of the trucking industry have experienced dramatic declines in freight growth involving rail transport.

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Truck Freight Volumes 69 Rail Freight Volumes Figure A.2. Truck freight volume forecasts. Figure A.2. Truck freight volume forecasts. Rail Freight Volumes Freight Performance Trend: Increasing Truck Volumes 1 As illustrated above, truck volumes are predicted to sustain steady growth on the national level. The growth is positive as an indicator of long-term economic health but creates additional pressures on the highway network. Figure A.3. Rail growth forecast. Though the current economic environment has reduced truck freight volumes in 2009, long-term growth for the Truckload (TL) and Less-Than-Truckload Freight Performance Trend: (LTL) Increasing sectors are expected. In general, LTL annual growth rates are forecast to remain higher than TL growth rates. Between 2009 and 2014, the annual rate of growth for the LTL Railabove sector is slightly freight volumes 2.5 are year, percent per expected to increase and beginning overall in 2015, thethrough 2020, annual rate putting of growth isincreasing pressure on an forecast to increase already congested national rail network. The source of the rail forecast is the next generation Freight to over 3.5 percent. Analysis Framework FAF2 database. FAF2 freight flow origin and destination (O-D) coverage spans 131 The TL sector, the predominant industry sector, is expected to increase at a slightly slower pace. Tonnage hauled by freight analysis zones that include 114 freight O-D zones and 17 major ports, border crossings, and freight this sector is forecast to increase nearly 2.5 percent per year until 2014, then experience a higher annual growth rate between 2015 ports. The FAF2 and 2020. commodity The Pacific flow data region (which are benchmarked includes to 2002 Alaska, California, and Oregon, Hawaii, are forecasted to 2035. This and Washington) analysis of the rail forecast utilizes the 2008 values and the 2035 estimates. The rail experienced an increase in the percentage of total U.S. tonnage of primary shipments originating in this region information from is 13.6 percentavailable in 2002 tofor 14.6all transport percent and then in 2007. divided It should into that be noted three potential the economic submarkets: conditions anddomestic, tonnage ofborder crossings, and sea shipments hauled movements. by trucks Table originating A.2 presents in California the 2008impacts significantly and 2035 values these the rail mode.3 The forecast for metrics. regional estimates The ATA forecast that total estimates rail traffic that trucks will13.3 will haul increase by billion just tons inunder 2020. 2 percent FAF FHWA's annually. This forecasts increase that is present even by 2035 trucks will Figure with haul A.3. an 22.8 Rail estimated decrease billionforecast. growth tons of freight. in 2 rail traffic for origindestination pairs involving sea traffic, with such traffic Figure A.3. Rail growth estimated forecast. to decrease by 1.4 percent. Domestic rail movements represent the highest growth, at an The severity Freight of the recent challenging Performance economic environment and rapid decline in freight volumes for all modes was estimate of 2.1 Trend: percent. Increasing largely unanticipated by most industry experts. Though most sectors of the trucking industry have experienced Rail freight dramatic volumes Table declines inA.2. are volumes, Rail freight expected to category increase volume tonnage by .overall through 2020,to putting increasing pressure onbyan Table A.2. Rail volume byhauled by trucks category. is expected grow in the long term, driven already congested population growth and national rail increased network. economic The source of the rail forecast is the next generation Freight activity. The forecast rate Analysis Framework FAF2 database. FAF2 freight flow origin and destination (O-D) coverage spans 131 Segment 2008 Value (tons) 2035 Forecast (tons) Growth Rate of freight growth freight analysis zones that include 114 freight O-D zones and 17 major ports, border crossings, and freight Domestic by mode may be ports. The FAF2 commodity flow 1,861,312 data are benchmarked to 2002 and are forecasted+2.1% 3,292,228 to 2035. This defined as the analysis of the rail forecast utilizes the 2008 values and the 2035 estimates. The rail information is Sea 237,824 164,154 -1.4% estimated available for all transport and then divided into three potential submarkets: domestic, border crossings, 4 3 percentage and sea movements. Border Table A.2 presents 145,748 the 2008 and 2035232,987 values for the rail mode. The forecast +1.8% increase in estimates that total rail traffic will increase by just under 2 percent annually. This increase is present even Totaldecrease in rail 2,244,884 3,689,369 +1.9% with such tonnage hauled in with an estimated traffic for origindestination pairs involving sea traffic, traffic future years for estimated to decrease by 1.4 percent. Domestic rail movements represent the highest growth, at an the major modes of freight transportation. Baseline figures and forecast tonnage figures are limited to estimate of 2.1 percent. primary shipments (primary shipments are defined as those handled the first time). This measure Table A.2. Rail volume by category. Inland Water Freight the relative decline of manufacturing in the United States, a sector that relied upon bulkTheshipments forecast rateof raw materials. 5 Water Freight Performance Segment Trend: 2008 Value (tons)Mixed 2035 Forecast The (tons) Growth increasingly Rate globalized economy resulted in increasing of freight growth Domestic waterborne freight volumes declined slightly import and export volumes. by mode may be Domestic 1,861,312 3,292,228 +2.1% from 1991 to 2005 (see Figure A.4) while waterborne imports definedfor The water information is found as the all transport, and then Sea and exports increased 237,824 to the U.S. Army significantly, according -1.4%potentialestimated 164,154 divided into three submarkets: domestic, border Corps of Engineers (USACE) Total Waterborne Commerce of percentage Border 145,748 232,987 crossings, and sea movements. +1.8% Table A.3 presents the 2008 and the United States.4 These trends are generally attributed to increase 2035 values for the water mode. 5 Thein forecast estimates that Total 2,244,884 3,689,369 +1.9% tonnage hauled in future years for the major modes of freight transportation. Baseline figures and forecast tonnage figures are limited to primary shipments (primary shipments are defined as those handled the first time). This measure 5

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1700 70 s 1500 n o 1300 T n o 1100 i l l 900 US Waterborne Commerce i M 700 1700 500 1500 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 Million Tons 1300 1100 Foreign Domestic 900 Figure 700 A.4. Waterborne volume. 500 Water Freight Performance Trend: Mixed 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 Domestic waterborne freight volumes declined slightly in the past 15 years while waterborne imports and exports increased significantly, according to the U.S. Army Foreign Corps of Engineers (USACE) Total Domestic 4 Waterborne Commerce of the United States. These trends are generally attributed to the relative decline Figure A.4. Waterborne volume. of manufacturing in the United States, a sector that relied upon bulk shipments of raw materials. The Figure A.4. Waterborne volume. increasingly globalized economy resulted in increasing import and export volumes. Table Table A.3. Water A.3. Water freight freight volumes. volumes. Segment 2008 Value (tons) 2035 Forecast (tons) Growth Rate Domestic 519,944 873,863 +1.9% Sea 110,281 161,173 +1.4% Border 1,624 6,457 +5.2% Total 631,849 1,041,394 +1.9% The water information is found for all transport, and then divided into three potential submarkets: domestic, border crossings, and sea movements. Table A.3 presents the 2008 and 2035 values for the water mode.5 The forecast estimates that total water traffic will increase by just under 2 percent. Water movements that involve cross-border, origindestination pairs but are not classified under the Sea category have total water traffic will increase an estimate by just under 2for Waterhigher Containerized substantially percent. Imports/Exports percentage growth (5.2 percent), but the estimate is movements that involve basedcross-border, on a very small origin base forecast (0.26 percent of total traffic), and caution must therefore be given to destination the rate pairs but are not classified forecast under forSea the this category subset. have an Freight Performance Trend: Steady Growth estimate for substantially higher percentage growth (5.2 per- U.S. container traffic through ports has more than doubled cent), but the estimate is based on a very small base forecast since 1995, rising from 22 million TEU6 in 1995 to 45 million (0.26 percent of total traffic), and caution must therefore be in 2007 (see Figure A.5).7 The economic slowdown of 2008 7 given to the rate forecast for this subset. caused units to decline from 45 million in 2007 to 38 million Figure A.5. U.S. container volume growth.

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71 in 2008. This represents an annualized rate of growth of 4.5 put, concentration of containerized cargo at the top U.S. percent for the United States since 1995. The port volumes are ports, regional shifts in cargo handled, vessel calls and capac- not uniform. The top 20 U.S. ports handle more than 96 per- ity in ports, the rankings of U.S. ports among the world's top cent of all container movements. Globally, container move- ports, and the number of maritime container entries into the ments tripled from1995 to 2007, rising by 8 percent annually. United States relative to truck and rail containers. Three sources of data were identified. Actual data from 2007 Estimates of growth have been developed by private orga- are available from USACE's Navigation Data Center.8 In 2007, nizations, but they are generally presented as global estimates. U.S. ports handled 17,821,238 TEU of loaded inbound con- In November 2007, Global Insight, Inc. predicted a global tainers, and 10,349,603 TEU of loaded outbound containers. growth rate for 2010 of approximately 6.9 percent.9 More Growth over the last decade was identified through a recently, PIERS Trade Horizons forecast a 2.8 percent decline recent report, America's Container Ports: Freight Hubs That in import volumes in 2009, and a weak recovery to 1.5 per- Connect Our Nation to Global Markets, released by the Bureau cent growth in 2010. The same forecast expected exports to of Transportation Statistics (BTS) of the Research and Inno- contract 6.6 percent in 2009 and fall a further 1.3 percent in vative Technology Administration (RITA). The report covers 2010. Long-term global growth is expected as China, India, the impact of the recent U.S. and global economic downturn and other developing countries continue to expand their on U.S. port container traffic, trends in container through- economies.

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72 Freight Efficiency Measures For analytical purposes, interstate routes are divided into 3-mile segments. Truck speeds for each truck movement on Following are the measures for the category of Freight one of the 25 interstates studied are calculated and attributed Efficiency. to each segment. The end result is a dataset that allows users Interstate Highway Speeds to query and conduct customized analyses on more than Interstate Highway Speeds 60,000 miles (by travel direction) of interstate highway. FHWA sponsored the Freight Performance Measures program, which is managed by the American FHWA sponsored the Freight Transportation Performance Research Measures Institute (ATRI). pro- and analyzes truck position data to produce key It collects gram, which is freight managed by the American Transportation performance measures. As part of this effort, ATRI calculatesPerformance average speeds overTrend:time for aDecreases in Freight Research Institute (ATRI). strategic setIt ofcollects and analyzes U.S. interstate corridors truck with posi- significant levels of truck activity. Overall Average Speed Are Expected tion data to produce key freight performance measures. As Data Description part of this effort, ATRI calculates average speeds over time Interstate highways are a key component of the U.S. freight The for a strategic set of data U.S.described interstate incorridors this section are derived with from several significant hundred thousand transportation trucks system. that operate Figures in the A.6 and A.7 show average truck United levels of truck activity. States. For analytical purposes, interstate routes are divided speeds into over a 3-mile one-monthsegments. timeTruck speeds period on interstate highways for each truck movement on one of the The data described in this section are derived from several 25 interstates studied are calculated and attributed to each in the United States as calculated by the FHWA/ATRI sys- hundred thousand segment. trucks The endoperate that result is aindataset that allows the United users to query States. tem. and conduct Although customized these analyses aggregated on over data moreone month do not than 60,000 miles (by travel direction) of interstate highway. Map 1- Northbound Map 2- Southbound Figure A.6. Figure A.6. Northbound Northbound and southbound and southbound IHS speeds. IHS speeds. Freight Performance Trend: Decreases in Overall Average Speed Are Expected Interstate highways are a key component of the U.S. freight transportation system. Figures A.6 and A.7 show average truck speeds over a one-month time period on interstate highways in the United States as calculated by the FHWA/ATRI system. Although these aggregated data over one month do not highlight peak periods or incidents and system disruptions, they do indicate that average speeds are higher in rural areas and lower in larger urban regions. As more years of data are analyzed, additional trend lines can be produced to illustrate changes over time. 10 Map 3- Westbound Map 4- Eastbound Map Figure3- Westbound A.7. Figure A.7. Westbound Westbound and eastbound and eastbound Map 4- Eastbound IHS speeds. IHS speeds. Figure A.7. Westbound and eastbound IHS speeds. Comment [JP3]: Author: I'm Future Trend Line: Congestion on Interstates Will Increase by the map labels--you'd better Comment [JP3]: Author: I'm the maps! The A head and text ne Future Trend Line: Congestion on Interstates Will Increase by the map labels--you'd better Recent declines in both truck and automobile travel are in contrast with historical increases in vehicle be moved below the map labels. the maps! The A head and text ne Recent declines miles traveled in both (VMT) Intruck and automobile the long term, FHWA travel are in predicts contrast that, with with no historical significant increases increases inin vehicle capacity, be moved below the map labels. miles traveled portions of the (VMT) In the NHS with long term, recurring FHWAwill congestion predicts that,four-fold increase by 2035.10 increases in capacity, with no significant

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73 highlight peak periods or incidents and system disruptions, Figure A.10 identifies the percentage of total segments on they do indicate that average speeds are higher in rural areas each interstate corridor with an average speed less than 50 and lower in larger urban regions. As more years of data are mph. This measure can be used to compare the performance analyzed, additional trend lines can be produced to illustrate of various interstates, regardless of overall length. changes over time. Interstate Highway Future Trend Line: Congestion on Reliability Measure Interstates Will Increase In addition to average truck travel speeds or a compari- Recent declines in both truck and automobile travel are son of the percentage of segments with average truck speeds in contrast with historical increases in vehicle miles traveled less than free-flow, the ATRI/FHWA system can measure the (VMT). In the long term, FHWA predicts that, with no sig- travel-time reliability of corridors and specific segments. nificant increases in capacity, portions of the National High- Reliability refers to the predictability of travel speeds or travel way System (NHS) with recurring congestion will increase times. Reliability is highly valued because of the need to pre- four-fold by 2035.10 dict estimated shipment times. In Figure A.11, Interstate 45 Figure A.8 offers one method of measuring the performance is an example of a highway with a high buffer index, which of the transportation system for freight movements via truck. indicates a large variability in average speed across the entire As shown above, the majority of roadway segments have an interstate route. Conversely, Interstates 24 and 65 have lower average aggregate truck travel speed between 55 mph and buffer index scores, suggesting that travel times on the cor- 60 mph. The distribution of this curve over time could be a ridors are more reliable and vary less. future performance indicator to illustrate change in the num- The ATRI/FHWA Freight Performance Measure (FPM) ber of interstate highway sections with below-average speeds. system features a database that contains historical truck posi- As shown in Figure A.9, another system performance met- tion data for most of the last decade. The system is updated ric is to measure trends related to particular deficiencies. In monthly, and trucks can report position reads as frequently this case, the focus is on the number of segments with average as every 15 minutes. Wireless truck position reports are aggregate speeds that are less than 50 mph; a trend line may received from approximately 600,000 trucks and cover major be developed as the total number of segments with speeds less highways and surface streets throughout the United States than free flow is compared month to month. and Canada, as well as Mexico. With the use of this system, it Figure Figure A.8 Distribution A.8. of truck of Distribution speeds. truck speeds. Figure A.8 offers one method of measuring the performance of the transportation system for freight movements via truck. As shown above, the majority of roadway segments have an average aggregate truck travel speed between 55 mph and 60 mph. The distribution of this curve over time could be a future performance indicator to illustrate change in the number of interstate highway sections with below- average speeds.

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74 Percent of Segments < 50 MPH I-95 I-94 I-91 I-90 I-87 I-85 I-84 I-81 I-80 I-77 I-76 I-75 Corridor I-70 I-65 I-55 I-45 I-40 I-35 I-26 I-25 I-24 I-20 I-15 I-10 I-05 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% Percentage Figure Figure A.9 A.9. Segments Segments below 50 mph. below 50 mph. Figure A.10 identifies the percentage of total segments on each interstate corridor with an average speed less than 50 mph. This measure can be used to compare the performance of various interstates, regardless of overall length. 13 Figure Figure A.10. A.10. Distribution Distribution of speeds. of speeds.

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Interstate Highway Reliability Measure 75 Corridor Buffer Index I-95 I-94 I-91 I-90 I-87 I-85 I-84 I-81 I-80 I-77 I-76 I-75 Corridor I-70 I-65 I-55 I-45 I-40 I-35 I-26 I-25 I-24 I-20 I-15 I-10 I-05 0 5 10 15 20 25 30 35 Buffer Index Figure Figure A.11. A.11. Buffer index byBuffer index by roadway. roadway. In addition to average truck travel speeds or a comparison of the percentage of segments with average truck speeds less than free-flow, the ATRI/FHWA system can measure the travel-time reliability of corridors and specific segments. Reliability refers to the predictability of travel speeds or travel times. Reliability is highly valued because of the need to predict estimated shipment times. In Figure A.11, is possible to conduct a far more focused analysis of average could be used to provide trend lines extrapolated over time. Interstate 45 is an example of a highway with a high buffer index, which indicates a large variability in travel rates or system reliability over time. Additional analy- Figures A.12, A.13, and A.14 represent graphical depictions of average speed across the entire interstate route. Conversely, Interstates 24 and 65 have lower buffer index ses could focus on specific days or hours of the day. Data can the severity of the Table A.4 freight bottlenecks. scores, suggesting that travel times on the corridors are more reliable and vary less. be analyzed at levels ranging from transcontinental corridors The (e.g., Interstate 10) toATRI/FHWA specific urban Freight Performance Measure (FPM) system features a database that contains intersections. Future historical truck position data for most of the last decade. Trend The system Line: is updated Negative monthly, and trucks can report position reads as frequently as every 15 minutes. Wireless truck position reports are received from The negative impacts of freight bottlenecks are expected Trend Line approximately of Top 600,000 trucks and cover major highways and surface streets throughout the United States to become more severe as the demand for freight transporta- Interstate Bottlenecks tion continues to grow and peak period congestion 15 increases. Table A.4 illustrates how the FPM system can analyze Additionally, the annual vehicle miles traveled by passenger trends in severe highway bottlenecks. The rankings are based vehicles will bolster congestion levels even further. on a measure called the total freight congestion value, which The high quality of data used to identify and rank the top is an index that uses truck delay and relative volume informa- interstate bottlenecks is due to the source of the data--actual tion within bottlenecks as inputs. As evidenced by the high- trucks that produce a location, time stamp, and speed mea- est total freight congestion value, the top bottleneck affecting sure. Before these data are processed by the ATRI/FHWA FPM freight movement via truck (among the nine listed) occurs in system, the data undergo extensive data quality procedures. Bergen, New Jersey, on I-95 at SR-4. The ATRI/FHWA FPM database contains historical data The ATRI/FHWA FPM system has the ability to produce across much of this decade, and the database is updated performance trends for bottlenecks at any freight-significant monthly. Truck position reports for each truck are produced location, and an index of 100 bottlenecks will be compiled on based on how frequently individual trucks are pinged, which a quarterly basis during 2010. In the long term, this system can range between every few minutes to every few hours.

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85 trucks, the emission rate in 2020 will be 82 percent lower than VOCs in 2002. Volatile Organic Compounds Truck NOx Emissions Similar to PM and NOx emission factors, VOC emission factors for the three main types of truck configurations are Oxides of nitrogen, NOx, are a precursor, along with expected to decline significantly from 2002 to 2020 (Figure VOCs, of ground-level ozone. Ozone, informally known A.24).22 These declines include an approximate decrease of as smog, is a significant pollutant that has been attributed 90 percent for single-unit gasoline vehicles, 36 percent for to thousands of premature deaths annually. It forms when single-unit diesel vehicles, and a 53 percent for combination NOx and VOCs interact with sunlight, particularly at higher diesel vehicles. temperatures. Again, the reductions are attributable to cleaner fuels and The performance trends for truck-generated NOx are also cleaner vehicles. positive and show Truck significant NOx decreasesEmissions from 2002 to 2010 (Figure A.22). EPA estimates total NOx emissions from large Greenhouse Emissions trucks will decline from 3.78 million tons in 2002 to 2.19 mil- Heavy-Duty Truck NOx Emissions lion tons in 2010, a 42 percent decrease.21 By 2020, NOx emis- Greenhouse emissions (GHE) consist of six types of pol- sions from large trucks 4,000,000 are expected to decrease 82 percent lutants, including carbon dioxide (CO2), methane (CH4), below 2002 levels to 662,600 tons. This is the highest percent- 3,500,000 nitrous oxide (N2O), and fluorinated gases. Of the GHE, age decline in total NOx emissions 3,000,000 for any freight transporta- CO2 is the primary gas produced during fossil fuel consump- Annual Tons tion mode. The reduction 2,500,000 in NOx is attributable to the use of tion. At least some amounts of these gases are found in the ULSD and the phase-in2,000,000 of cleaner diesel engines that must atmosphere naturally. GHE are not currently regulated by 1,500,000 meet 2007 emission standards (see Figure A.23). As the cur- the federal government, though EPA has recently proposed 1,000,000 rent fleet is retired and new vehicles 500,000 purchased, the emission a rule mandating that large sources of GHE annually report reductions will increase. - Truck NOx Emissions amounts of GHE emitted. 2002 2010 2020 Year Heavy-Duty Truck NOx Emissions Figure A.22. NOx reductions. 4,000,000 Oxides of nitrogen, NOx, are a precursor, along with VOCs, of ground-level ozone. Ozone, informally 3,500,000 known as smog, is a significant pollutant that has been attributed to thousands of premature deaths 3,000,000 annually. It forms when NOx and VOCs interact with sunlight, particularly at higher temperatures. Annual Tons 2,500,000 The performance trends for truck-generated NOx are also positive and show significant decreases from 2,000,000 1,500,000 2002 to 2010 (Figure A.22). The EPA estimates total NOx emissions from large trucks will decline from 1,000,000 3.78 million tons in 2002 to 2.19 million tons in 2010, a 42 percent decrease.21 By 2020, NOx emissions 500,000 from large trucks are expected to decrease 82 percent below 2002 levels to 662,600 tons. This is the - highest percentage decline in total 2002 NOx emissions for any freight transportation 2010 mode. The reduction in 2020 NOx is attributable to the use of ULSD and the phase-inYearof cleaner diesel engines that must meet 2007 emission standards. As the current fleet is retired and new vehicles purchased, the emission reductions Figure A.22. NOx reductions. will increase. Figure A.22. NOx reductions. Oxides of nitrogen, NOx, are a precursor, along with VOCs, of ground-level ozone. Ozone, informally Heavy-Duty Truck NOx Emission Factors, Urban Freeway known as smog, is a significant pollutant that has been attributed to thousands of premature deaths 30 annually. It forms when NOx and VOCs interact with sunlight, particularly at higher temperatures. 25 The performance trends for truck-generated NOx are also positive and show significant decreases from 20 2002 to 2010 (Figure A.22). The EPA estimates total NOx emissions from large trucks will decline from ile 2002 3.78 million tons in 2002 to 2.19 million tons in 2010, a 42 percent decrease.21 By 2020, Grams/M 15 NOx emissions 2010 10 from large trucks are expected to decrease 82 percent below 2002 levels to 662,600 tons. This is the 2020 highest percentage decline in total NOx emissions for any freight transportation mode. The reduction in 5 NOx is attributable to the use of ULSD and the phase-in of cleaner diesel engines that must meet 2007 0 emission standards. As the current Single-Unit Gasoline fleet is retired and new vehicles Single-Unit Diesel purchased, the emission reductions Combination Diesel will increase. Truck Type Figure Figure A-23. A.23. Heavy-duty Heavy-duty NOx emission NOx emission factors. factors. Heavy Duty Truck NOx Emission Factors, Urban Freeway 33 30 25 20 ile 2002 ams/M 15 2010

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86 Between 1990 and 2007, EPA estimates that CO2 emissions, lent (Tg CO2 Eq.) to 1,887.4 Tg CO2 Eq. 27 EPA attributes this the primary GHE produced by medium- and heavy-duty growth in CO2 emissions to an increase in the demand for trucks, increased significantly (Figure A.25).23 EPA attributes transportation, low fuel prices, and economic growth. Dur- this increase to growth in demand for freight movement by ing this same time period, total GHE from all sources (mobile truck and the subsequent increase in miles traveled by these and stationary) increased from 5,076.7 Tg CO2 Eq to 6,103.4 vehicles. In 2007, truck VMT in the United States was 318.8 Tg CO2 Eq. billion miles.24 Future estimates of GHE attributed to "Freight Trucks," As shown in Figure A.26, EPA allocates the majority (61 defined as trucks with a gross vehicle weight rating (GVWR) percent) of transportation-related CO2 to the consump- over 10,000 pounds, are provided by the U.S. Department of tion of gasoline by light-duty vehicles (cars, light trucks, Energy, Energy Information Administration (EIA). EIA esti- SUVs).25 Medium- and heavy-duty trucks are allocated mates that in 2009, these vehicles will emit 335.34 Tg CO2 nearly a quarter (22 percent) of total CO2 transportation Eq., a lower amount than in 2007.28 By 2030, EIA forecasts sector emissions. that these vehicles will emit 446.43 Tg CO2 Eq. (Figure A.27). Total GHE are typically measured in metric tons or tera- GHE estimates for mobile sources are based on the vol- grams26 of CO2 equivalent (Tg CO2 Eq.). Between 1990 and umes of diesel and/or gasoline taxed and the estimated VMT 2007, the total amount of CO2 emitted by all modes of trans- in each state.29 A common methodology for estimating truck- VOCs portation increased from 1,484.5 teragrams of CO2 equiva- related GHE includes: determining/estimating total fuel Heavy-Duty Truck VOC Emission Factors, Urban Freeway 1.4 1.2 1 Grams/Mile 2002 0.8 2010 0.6 2020 0.4 0.2 0 Single-Unit Gasoline Single-Unit Diesel Combination Diesel Truck Type Figure A.24. VOC reductions. Figure A.24. VOC reductions. Volatile Organic Compounds Carbon Dioxide Emissions Medium and Large Trucks Similar to PM450and NOx emission factors, VOC emission factors for the three main types of truck configurations are expected to decline significantly from 2002 to 2020 (Figure A.24).22 These declines 400 include an approximate decrease of 90 percent for single-unit gasoline vehicles, 36 percent for single-unit Annual VMT (billion vehicle miles traveled) 79% increase in CO2 diesel vehicles, 350 and a 53 percent for combination diesel vehicles. emissions CO2 Emissions (Tg) or Again, the reductions 300 are attributable to cleaner fuels and cleaner vehicles. 55% increase 250 in VMT C02 200 Greenhouse Emissions 150 VMT Greenhouse emissions 100 (GHE) consist of six types of pollutants, including carbon dioxide (CO2), methane (CH4), nitrous 50oxide (N2O), and fluorinated gases. Of the GHE, CO2 is the primary gas produced during fossil fuel consumption. At least some amounts of these gases are found in the atmosphere naturally. 0 GHE are not currently regulated by 1990the federal government, though the EPA has recently proposed a rule 2007 mandating that large sources of GHE annually report amounts Year of GHE emitted. BetweenFigure A.25. 1990 and Truck 2007, EPA carbon estimates emissions. that CO emissions, the primary GHE produced by medium- and Figure A.26. Truck carbon emissions. 2 heavy-duty trucks, increased significantly (Figure A.26).23 EPA attributes this increase to growth in demand for freight movement by truck and the subsequent increase in miles traveled by these vehicles. In Estimated Future Carbon Dioxide Emissions 2007, truck VMT in the United States was 318.8 billion miles.24 to 2030, Freight Trucks 475 450

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Carbon Dioxide Emissions Medium and Large Trucks 450 87 400 Annual VMT (billion vehicle miles traveled) 350 Percentage of79% Carbon Dioxide increase in CO2 Emissions, emissions by Transportation Sector Use CO2 Emissions (Tg) or 300 55% increase 250 in VMT C02 200 Other, 10% VMT 150 Commercial Aircraft, 8% 100 50 Medium and Heavy- Car/Light-Duty Duty Trucks, 22% Trucks/SUVs, 61% 0 1990 2007 Year Figure A.26. Greenhouse emission sources. Figure A.26. Truck carbon emissions. Estimated Figure A.25. Greenhouse emission Future Carbon Dioxide Emissions sources. to 2030, Freight Trucks As shown above in Figure A.25, EPA allocates the majority (61 percent) of transportation-related CO2 to 475 of gasoline by light-duty vehicles (cars, light trucks, SUVs).25 Medium- and heavy-duty the consumption 450 trucks are allocated nearly a quarter (22 percent) of total CO2 transportation sector emissions. Metric Tons Equivalent 425 Total GHE are typically measured in metric tons or teragrams26 of CO2 equivalent (Tg CO2 Eq.). Between 400 375 1990 and 2007, the total amount of CO2 emitted by all modes of transportation increased from 1,484.5 350 teragrams of CO2 equivalent (Tg CO2 Eq.) to 1,887.4 Tg CO2 Eq. 27 EPA attributes this growth in CO2 325 emissions to an 300 increase in the demand for transportation, low fuel prices, and economic growth. During this same time period, total GHE from all sources (mobile and stationary) increased from 5,076.7 Tg CO2 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Eq to 6,103.4 Tg CO2 Eq. Year Figure A.27. Forecast carbon emissions. Figure A.27. Forecast carbon emissions. Future estimates of GHE attributed to "Freight Trucks," defined as trucks with a gross vehicle weight rating (GVWR) over 10,000 pounds, are provided by the U.S. Department of Energy, Energy Information consumption by fuel type and sector; Administration 30 adjusting (EIA). EIA up estimates these that cific vehicles in 2009, these jurisdiction. Unlike will emit PM, 335.34 Tg NO CO2 , and VOC, the age of the x Eq., a lower estimates based on VMT data; estimating 28 CO amount than in 2007. By 2030, emissions; truck's engine is less important than fuel economy. On the 2 EIA forecasts that these vehicles will emit 446.43 Tg CO2 Eq. (Figure and allocating transportation A.27). emissions by vehicle type. In national level, the amount of fuel consumed (derived from addition, these estimates may also be based on surveys of the amount of fuel taxed or purchased) multiplied by the GHE estimates for mobile sources are based on the volumes of diesel and/or gasoline taxed and the truck usage by motor carriers and vehicle-miles-per-gallon emission factor likely provides a reasonable estimate of the estimated VMT in each state.29 A common methodology for estimating truck-related GHE includes: averages. amount determining/estimating total fuel consumption by fuel of sector; type and GHE 30 emitted byup adjusting different vehicle types operating these estimates Estimates of future amounts of GHE attributable to freight in the United States. This is based on based on VMT data; estimating CO2 emissions, and allocating transportation emissions by vehicle the assumption that type. movement are based on assumptions of future economic fuel taxed/purchased in this country is likely consumed here. activity (and subsequent freight volumes) as well as pub- On the state level, interstate motor carriers 36 track these lic policies that make an effort to curtail greenhouse gases. activities on the individual truck level and can provide fuel Though government agencies increasingly are making efforts consumption by state (though the reported figures are typi- to regulate GHE, the long-term impact of these policies is cally based on fleet averages). On the metropolitan/local level, uncertain. Additionally, the future impact of industry efforts however, the relationship between where fuel 35 is purchased to reduce fuel consumption and GHE by participating in and where it is consumed is not known to an acceptable voluntary environmental programs and the increased use of degree of certainty. idle-reduction technologies is also not easily quantified. EPA annually updates the National Inventory of U.S. Rail-Produced Greenhouse Greenhouse Gas Emissions and Sinks. Included in the update Gas Emission are new estimation methodologies and revised calculations of all previous years' estimates. Data available from EPA indicate that GHE from rail As compared to other truck-related emissions, GHE are transport have steadily increased from 1990 (38.1 MMT) typically a function of how much fuel is consumed in a spe- until 2006 (51.8 MMT), then dropped slightly in 2007 (50.8

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88 MMT).31 The increase was attributable to increased rail relative performance: a growth period during the 1990s, a freight volume, and the decline was attributable to a reduc- sharp decline early in the decade, and new growth over the tion in train traffic. As shown in Figure A.28, this growth past several years. rate is approximately twice the growth rate of total national The EPA inventory information published in 2009 con- greenhouse gas emissions.32 tained data through calendar year 2007.34 Note that the analy- EPA's annual inventory of U.S. Greenhouse Gas Emissions sis does not distinguish between freight water transport and and Sinks does not distinguish between freight rail and pas- passenger water transport such as ferries; for the purposes of senger rail. For the purposes of this report, the entire GHE this report the entire greenhouse gas value is used as a proxy value is used as a proxy for freight rail GHE. Since 2005, data for waterborne freight GHE. have been published on an annual basis. The information pub- lished in 2009 contained data through calendar year 2007.33 Rail VOCs and NOx Freight Performance Trend: Decreasing Water-Produced Greenhouse Gas Emissions EPA standards adopted in 2008 are forecast to lead to a near 90 percent reduction in railroad locomotive emissions for the Freight Performance Trend: Mixed three primary pollutants, VOCs, NOx, and particulates.35 The EPA data indicate that greenhouse gases from water trans- standards will rely on a new generation of locomotive engine port in 2005 (45.4 MMT) through 2007 (50.8 MMT) have technology, with intermediate engine technology required decreased from a peak in 2000 (61.0 MMT). Figure A.29 for remanufactured locomotives. shows how water-freight-based GHE have varied when com- EPA anticipates that these engines may account for an even pared to all national GHE. There have been three bands of greater share of overall emissions over the next few decades Rail-Produced Greenhouse Gas Emission Rail Greenhouse Gas Growth Compared to All US Greenhouse Gas (1990-2007) 55 Rail GHG (MMT CO2) 50 45 Rail GHG 40 All US GHG (Indexed) 35 30 1990 1995 2000 2005 2010 Year Figure A.28. Rail greenhouse emissions. Figure A.28. Rail greenhouse emissions. Data available from EPA indicate that GHE from rail transport have steadily increased from 1990 (38.1 31 MMT) until Water Greenhouse 2006 (51.8 MMT), then Gas Growth dropped slightlyCompared in 2007 (50.8to All US MMT). The increase was attributable to increased rail freight volume, Greenhouse and the Gas decline was attributable to a reduction in train traffic. (1990-2007) As shown in Figure A.28 above, this growth rate is approximately twice the growth rate of total national greenhouse gas emissions.32 70 Water GHG (MMT CO2) 65 EPA's annual inventory of U.S. Greenhouse Gas Emissions and Sinks does not distinguish between 60 freight rail and passenger rail. For the purposes of this report, the entire GHE value is used as a proxy for Water GHG 55 freight 50 rail GHE. Since 2005, data have been published on an annual basis. The information published in 33 All US GHG (Indexed) 2009 45 contained data through calendar year 2007. 40 35 1990 1995 2000 2005 2010 Year Figure A.29. Water-freight greenhouse emissions. Figure A.29. Water-freight greenhouse emissions. Freight Performance Trend: Mixed EPA data indicate that greenhouse gases from water transport in 2005 (45.4 MMT) through 2007 (50.8 MMT) have decreased from a peak in 2000 (61.0 MMT). Figure A.29 above shows how water-freight- based GHE have varied when compared to all national GHE. There have been three bands of relative

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89 as other emission control programs take effect for cars and Ship NOx trucks and other nonroad emissions sources. Estimates show that, without the emission reductions, by 2030 locomotive Freight Performance Trend: Decreasing and marine diesel engines would contribute more than 65 As with locomotives, EPA is developing new standards percent of national mobile-source diesel PM2.5, or fine par- for ocean-going ships, which it estimates will by 2030 ticulate, emissions and 35 percent of national mobile-source reduce NOx emission rates by 80 percent and PM emis- NOx emissions, a key precursor to ozone and secondary PM sion rates by 85 percent, compared to the current limits formation. applicable to these engines. EPA has finalized more strin- According to the EPA 2005 National Emissions Inventory, gent standards for marine transport.39 EPA estimates that rail equipment primarily engaged in freight transportation by 2030 the management of the program according to the emitted 1,118,786 tons of NOx.36 The forecast trend, as dem- revised standards will reduce annual emissions of NOx by onstrated in Figure A.30,37 is that these emissions will be about 1.2 million tons and PM emissions by about 143,000 largely eliminated within 30 years. tons. Rail Emission Forecasts 1.2 Emission Factors/Gallon 1 0.8 VOC 0.6 PM NOX 0.4 0.2 0 39 06 09 12 15 18 21 24 27 30 33 36 20 20 20 20 20 20 20 20 20 20 20 20 Comment [CE7] Figure A.30. Rail emissions. change figure title t Figure A.30. Forecast rail VOC and NOx emissions. and NOx emissions Freight Performance Trend: Decreasing EPA standards adopted in 2008 are forecast to lead to a near 90 percent reduction in railroad locomotive emissions for the three primary pollutants, VOCs, NOx, and particulates.35 The standards will rely on a new generation of locomotive engine technology, with intermediate engine technology required for remanufactured locomotives. EPA anticipates that these engines may account for an even greater share of overall emissions over the next few decades as other emission control programs take effect for cars and trucks and other nonroad emissions sources. Estimates show that, without the emission reductions, by 2030 locomotive and marine diesel engines would contribute more than 65 percent of national mobile-source diesel PM2.5, or fine particulate, emissions and 35 percent of national mobile-source NOx emissions, a key precursor to ozone and secondary PM formation. According to the EPA 2005 National Emissions Inventory, rail equipment primarily engaged in freight transportation emitted 1,118,786 tons of NOx.36 The forecast trend, as demonstrated in Figure A.30 above,37 is that these emissions will be largely eliminated within thirty years.

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90 Freight Safety Measures Between 1988 and 2007, the large-truck injury crash rate decreased from 67.9 to 31.8.40 The 2007 rate is the Following are the Safety performance measure summaries. lowest on record. The large-truck fatal crash rate has also declined. In 2007, this rate was 1.85, down from a peak of Truck Injury and Fatal Crash Rates 5.21 in 1979.41 Freight Performance Trend: Positive Future Trend Line: Positive The performance trends for large-truck injury and fatal crash rates show significant improvement (Figures A.31 and Preliminary figures indicate that the number of large A.32). Large trucks are defined as vehicles with a gross vehicle trucks involved in both injury and fatal crashes again The data quality for large-truck injury crash rates is rated as declined ininadequate, primarily 2008.42 FMCSA because of cautions, FMCSA'sthat these however, weight rating (GVWR) greater than 10,000 pounds. Crash determination that not all states report every "FMCSA-eligible" crash to the Motor Carrier Management numbers may understate the actual number of large-truck rates are the number of crashes per 100 million vehicle miles Information System (MCMIS) Crash File. FMCSA-eligible crashes are defined as those that meet of travel (VMT). crashes. FMCSA's SAFETYNET definition of a reportable accident.43 FMCSA has acknowledged the deficiency of data contained in MCMIS and is working with several states to improve data collection and reporting. Large Truck Injury Crash Rate 80 70 Injury Crashes per 100M Truck VMT 60 50 40 30 20 10 0 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Year Truck Figure A.31. Figure A.31. Injury Truck Truck and injury injury crash Fatal crash rate. rate. Crash Rates More reliable truck fatal crash statistics are collected by National Highway Traffic Safety Administration (NHTSA) and entered into the Large Fatal Truck Accident Reporting Fatal System (FARS). FARS is widely recognized as Crash Rate 44 the most 6 reliable source of fatal truck crash data. Truck VMT estimates can also affect the accuracy of vehicle crash rates. These estimates are reported by the states 5 to FHWA and published annually in FHWA's Highway Stats. Since 1999, national truck VMT estimates generally show moderate annual growth. Conversely, some state-specific VMT estimates can Fatal Crashes per 100M Truck VMT fluctuate significantly from year to year. Additionally, because of the data collection methods used for 4 determining VMT, some have questioned the accuracy of available VMT data sources. The granularity of data used as inputs to crash-rate calculations is rated as adequate. These metrics are 3 available at the state and national levels. 2 1 0 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Year Figure A.32. Truck fatal crash rates. Figure A.32. Truck fatal crash rates. 44 Freight Performance Trend: Positive The performance trends for large-truck injury and fatal crash rates show significant improvement (Figures A.31 and A.32). Large trucks are defined as vehicles with a gross vehicle weight rating (GVWR) greater than 10,000 pounds. Crash rates are the number of crashes per 100 million vehicle miles of travel (VMT).

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91 Declines in large-truck crash rates may be attributed to The granularity of data used as inputs to crash-rate calcu- several factors, including targeted enforcement of less safe lations is rated as adequate. These metrics are available at the motor carriers and high-risk truck drivers, national driver state and national levels. training/credentialing initiatives, increased use of onboard safety systems in large trucks, improvements in truck and car HighwayRail At-Grade Incidents safety designs, and public outreach efforts to educate all road- way users on highway safety issues. A highwayrail at-grade crash is any impact between a rail The data quality for large-truck injury crash rates is rated user and a highway user at a crossing site, regardless of sever- as inadequate, primarily because of FMCSA's determination ity. This includes motor vehicles and other highway, roadway, that not all states report every "FMCSA-eligible" crash to the and sidewalk users at both public and private crossings. Motor Carrier Management Information System (MCMIS) The overall performance trend for highwayrail at-grade Crash File. FMCSA-eligible crashes are defined as those crashes in the United States has improved since 1998, most notice- that meet FMCSA's SAFETYNET definition of a reportable ably from 2000 to 2003 and from 2006 to 2008.45 The frequency accident. FMCSA has acknowledged the deficiency of data 43 of these incidents declined significantly in 2008 (see Figure A.33). contained in MCMIS and is working with several states to Although the number of these incidents has decreased, FRA improve data collection and reporting. has named as a top research strategy the modernizing of grade More reliable truck fatal crash statistics are collected by the crossings and the evaluation of public education and aware- National Highway Traffic Safety Administration (NHTSA) ness strategies to reduce incidents on railroad rights-of-way.46 and entered into the Fatal Accident Reporting System (FARS). Railroads operating in the United States are required to submit FARS is widely recognized as the most reliable source of fatal monthly accident reports to FRA. This report must include any truck crash data.44 collision between an on-track piece of equipment and any user Truck VMT estimates can also affect the accuracy of vehi- of a public or private crossing.47 Data quality is further bolstered cle crash rates. These estimates are reported by the states to by the required use of a standardized form for reporting these FHWA and published annually in FHWA's Highway Stats. types of incidents. In addition, FRA provides an online tool for Since 1999, national truck VMT estimates generally show railroads and states to compare and reconcile crossing location moderate annual growth. Conversely, some state-specific inventories with the USDOT National Crossing Inventory File.48 VMT estimates can fluctuate significantly from year to year. Crash data updates are published monthly. An FRA web- Additionally, because of the data collection methods used site allows users to query the incident database with a wide for determining HighwayRail VMT, some have questioned At-Grade the accuracy of Incidents range of filters, including railroad, state, county, public and/ available VMT data sources. or private crossings, and start/end date. Highway-Rail Incidents at Public and Private Crossings 1998-2008 4000 3500 3000 Number of Incidents 2500 2000 1500 1000 500 0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Accidents 3508 3489 3502 3237 3077 2977 3080 3060 2939 2767 2398 Source: Federal Railroad Administration, Office of Safety Year Analysis Figure Figure A.33. A.33. RR crossing RR crossing incidents. incidents. A highwayrail at-grade crash is any impact between a rail user and a highway user at a crossing site, regardless of severity. This includes motor vehicles and other highway, roadway, and sidewalk users at both public and private crossings. The overall performance trend for highwayrail at-grade crashes in the United States has improved since 1998, most noticeably from 2000 to 2003 and from 2006 to 2008.45 The frequency of these incidents

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92 Freight Investment Measures Average delay and average travel time costs on rural NHS routes would be maintained at an average annual investment These are the summaries for the Investment measures. level of $5.4 billion, while $22.2 billion would be required to maintain the same performance on urban NHS routes. Investment to Sustain NHS The biannual report is theoretically available every two years, but in some cases three years have passed between Freight Performance Trend: Increasing reports. The underlying data are at the local level. FHWA has The key indicator of the highway system's future condition versions of both systems that can be used by agencies to gen- is the ratio of the total estimated national investment in the erate forecasts for varying geographic regions. NHS over the next 10 years to the amount necessary to sus- tain current performance. Future Trend Line: Uncertain The source of the national investment amounts in NHS is the Conditions and Performance Report that FHWA prepares As can be seen from the last line of Table A.8, the ratio and submits biannually to the Congress. The currently avail- of total funds expended to sustain the NHS was positive in able analysis uses the 200449 and 200650 Status of the Nation's both 2002 and 2004 overall. However, in 2002, only 95 per- Highways, Bridges, and Transit: Conditions and Performance cent of what was necessary to sustain urban NHS conditions Report. Both reports contain data from two years before the was spent and in 2004 the ratio of what was spent compared report date: The 2004 report uses 2002 data, and the 2006 to what was required was exactly 1.0. As noted above, these report uses 2004 data. Highway rehabilitation and system figures for 2004 were calculated in 2006. Since 2004, highway expansion investments are modeled by the Highway Eco- construction cost inflation has risen significantly, in many nomic Requirements System (HERS), whereas the National regions by more than 50 percent between late 2004 and early Bridge Investment Analysis System (NBIAS) model analyzes 2009. Declining oil prices caused by the recession have mod- rehabilitation and replacement investment for all bridges, erated construction price increases, but they remain substan- including those on the NHS. tially above 2004 levels. Therefore, it is uncertain, given the Approximately $12.3 billion was spent on NHS rural arte- severely constrained purchasing power of the past several rials and collectors in 2004, and another $22.3 billion on years (20082010), whether recent expenditures on the NHS NHS urban arterials and collectors. Reported state govern- have been sufficient to sustain both condition and perfor- ment spending on NHS routes functionally classified as rural mance of the system. local or urban local was negligible in the year 2004. It is not currently possible to identify spending by local governments on these routes, which would mainly consist of intermodal Rail Industry Cost of Capital connectors and Strategic Highway Network (STRAHNET) Performance Trend: Improving but Connectors. STRAHNET is a national set of roadways that Incomplete provide access to defense facilities. Of the total $34.6 billion spent by all levels of government for the capital improve- Earning more than the cost of capital is a basic measure ments to the NHS in 2004, approximately 45.0 percent was of financial health in any industry. The Surface Transporta- used on the interstate component of the NHS. tion Board calculates annually the cost of capital for the U.S. Table Table A.8.NHS A.8. NHSinvestment investment level level adequacy. adequacy. 2002 2004 Trend (annual percentage) Rural Urban Total Rural Urban Total Rural Urban Total Total NHS Investment ($B) $14.9 $20.4 $35.3 $12.3 $22.3 $34.6 -9.1% 4.6% -1.0% Average Investment Needed to $7.0 $21.5 $28.5 $5.4 $22.2 $27.6 -12.2 1.6% -1.6% Maintain Average Delay and Travel Time Costs Ratio of Total vs. Average Needed 2.13 .95 1.24 2.28 1.0 1.25 3.4% 2.9% .6%

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93 Class I railroads. For 2008, STB estimated that the railroad's vidual railroads' revenues each year. The figure is also used in cost of capital was 11.75 percent51 (see Figure A.34). The rail- maximum rate cases, feeder-line applications, rail-line aban- roads are a very capital-intensive industry because of their donments, trackage rights cases, rail-merger reviews, and need for tracks, locomotives, train cars, and related equip- more generally in the STB's Uniform Rail Costing System. ment and facilities. If they do not earn more than their cost The railroad cost of capital determined here is an aggregate of capital, it is an indicator that investments in rail capital are measure. It is not intended to measure the desirability of any economically inefficient and that other investments would individual capital investment project. earn a higher economic return. Although the cost of debt is observable and readily avail- Despite significant gains in productivity and profitability able, the cost of equity (the expected return that equity inves- since the 1980s Staggers Act deregulation, the Class I railroads tors require) can only be estimated. How best to calculate the still struggle to earn their cost of capital; railroads earn only cost of equity is the subject of a vast amount of literature about 8 percent on net capital, according to the FRA.52 This is covering the fields of finance, economics, and regulation. a modest rate of return compared to some other industries. In each case, however, because the cost of equity cannot For decades, American railroads earned the lowest rates of be directly observed, estimating the cost of equity requires return of any major U.S. industry. Between 1960 and 1979 adopting a financial model and making a variety of simplify- the average annual return on shareholder equity was 2.3 per- ing assumptions. cent.53 U.S. railroads have estimated that up to 40 percent of As noted above, the 2008 composite after-tax cost of capital their revenues are devoted to capital assets, a percentage that for the railroad industry was 11.75 percent. The procedure is significantly higher than most industries. The high cost of used to develop the composite cost of capital is consistent maintenance for track, rolling stock, and yards requires sub- with the Statement of Principle established by the Railroad stantial capital investments, which are not liquid or mobile. Accounting Principles Board: "Cost of capital shall be a Investing in capital represents a significant long-term invest- weighted average computed using proportions of debt and ment for a railroad. equity as determined by their market values and current mar- If national policy develops that seeks to expand railroad ket rates." The 2008 cost of capital was 0.42 percentage points capacity so that rail absorbs a larger percentage of national higher than the 2007 cost of capital (11.33%).55 freight traffic, the cost-of-capital calculation can be an impor- Although the methodology has been recently updated tant metric to assess the industry's ability to finance its capital and the cost of debt is observable, the abundance of litera- expansion. This metric may be defined as the required return ture regarding variations in calculating the cost of equity is a necessary to make the capital budgeting projects worthwhile source of potential concern. The analysis is conducted each in the rail freight industry. Cost of capital is the weighted year to support existing financial decision-making processes. average computed using proportions of debt and equity as It is unlikely that the frequency of this analysis will decline. determined by their market values and current market rates.54 The analysis is conducted only at the national level. It may STB annually determines the cost of capital (with input be impossible to identify and quantify significant variations from AAR) and uses it in evaluating the adequacy of indi- for specific localities. Rail Industry Cost of Capital Figure A.34. Rail cost of capital. Figure A.34. Rail cost of capital. Performance Trend: Improving but Incomplete Earning more than the cost of capital is a basic measure of financial health in any industry. The Surface Transportation Board calculates annually the cost of capital for the U.S. Class I railroads. For 2008, STB estimated that the railroad's cost of capital was 11.75 percent51 (see Figure A.34). The railroads are a very capital-intensive industry because of their need for tracks, locomotives, train cars, and related equipment and facilities. If they do not earn more than their cost of capital, it is an indicator that investments in rail

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94 Estimated Capital to Sustain coal fields, port complexes, and major rail traffic junctions. Rail Market Share The number of trains on the network is based on the 2005 Surface Transportation Board Carload Waybill Sample. Freight Performance Trend: Increasing The 2007 report was the first of its type. It is unclear if the The estimated rail capital investment to sustain market AAR intends on replicating the study calculations on a peri- share has not traditionally been a publicly calculated value. odic basis. However, the framework proposes investigating if However, it represents an estimate based on a definitive study the AAR would assist in reporting the annual investment gap. of what level of investment is needed for Class I railroads to sustain their current market share in the face of rising freight Investment to Sustain Inland volumes. Waterway System The National Surface Transportation Policy and Revenue Study Commission, charged by Congress to develop a plan of The inland waterway system comprises 12,000 navigable improvements to the nation's surface transportation systems miles connecting 41 states, including all states east of the to meet the needs of the twenty-first century, requested that Mississippi River. On this system are 230 locks, which had AAR commission a study56 to estimate the system's long-term an average age in 2007 of 56.7 years.57 Many were built in the capacity needs. 1930s with an expected design life of 50 years. Seven of the The study, released in 2007, identified that the investment locks were built in the 1800s, and the oldest operating lock is will have to increase over the study's planning horizon of from 1839. USACE reports that locks were available 92 per- 28 years if Class I railroads are to keep up with expected cent of the time in calendar 200758 and that lock downtime freight demand. The total investment required is $148 bil- created 157,430 hours of delay. lion, or a straight-line average investment of $5.3 billion Although inland water volumes have been relatively sta- per year. The study also identified that this amount was ble in the past decade overall, the inland system is impor- increasing as time passed without higher investment levels. tant to many bulk commodities. The marine transportation The AAR reported that between 2005 and 2007 Class I rail- and inland waterway system moves an estimated 60 percent roads invested an average of $1.5 billion annually for expan- of grain exports and an estimated 95 percent of soybean sion, leaving an annual investment gap of $3.3 billion. The exports.59 It also is disproportionately important for ore, railroads estimated that through increased revenues and chemicals, and mining products. productivity, they could generate $3.4 billion annually of The suggested performance metric for the inland water- the $4.8 billion needed to invest in capacity. That leaves an way system is proposed to be the average age of the locks. "investment gap" of $1.4 billion annually to be funded from Based upon current levels of investment in lock replacement, railroad investment tax incentives, public-private partner- the average age of the inland locks has increased annually, ships, or other sources. Tracking the investment gap would with no reduction in average age in many years. Although provide an ongoing metric of the sufficiency of investment age alone may not be an indicator of lock performance, it in the nation's rail network. is proposed as the initial metric for the performance of the The network used in the methodology is corridor based, inland waterway system. with corridors being specified by the Class I railroads par- The data quality of this measure is high because of the ticipating in the study. The beginnings and ends of the cor- fixed and static nature of the waterway system. The data also ridors are major urban areas corresponding with the USDOT are highly granular, because age and performance data are Freight Analysis Framework Version 2.2 (FAF2.2) zones, available for every lock. That would allow any region to track major rail traffic generators such as the Powder River Basin the age of the waterway system in its area Endnotes 8http://www.iwr.usace.army.mil/ndc/wcsc/by_portname07.htm. 9 Paul Bingham (Global Insight, Inc.). The Importance of Ports for Trade and 1 American Trucking Associations and IHS Global Insight. U.S. Freight Trans- the Economy, Torrance, CA, November 15, 2007. http://www.futureports. portation Forecast to...2020. Arlington, VA. org/events/bingham_globalinsight_111507.pdf. 2FHA. Freight Facts and Figures: 2008. 10FHWA. Freight Facts and Figures: 2008. 3 2008 FAF Provisional Database and FAF2 Forecast. 11http://www.railroadpm.org/. 4 USACE. Table 1-1, in Total Waterborne Commerce of the U.S. 19662005, 12 USDOT, BTS. Table 1-46b, National Transportation Statistics 2009. http:// 2007, p. Totals 1-3. www.bts.gov/publications/national_transportation_statistics/html/ 5 2008 FAF Provisional Database and FAF2 Forecast. table_01_46b.html. 6 20-ft equivalent units. 13CSCMP. Annual State of the Logistics Report, 2010. 7http://www.bts.gov/press_releases/2009/dot084_09_01/html/dot084_09. 14FHWA. Status of the Nation's Highways, Bridges, and Transit: Conditions and html. Performance, 2006. http://www.fhwa.dot.gov/policy/2006cpr/index.htm.

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95 15http://www.epa.gov/oms/regs/nonroad/420f08004.htm. 34 EPA, Report EPA 430-R-09-004. 16FHWA. Assessing the Effects of Freight Movement on Air Quality at the Natio- 35http://www.epa.gov/oms/regs/nonroad/420f08004.htm. nal and Regional Level--Final Report, prepared by ICF Consulting, Fairfax, 36http://www.epa.gov/ttn/chief/net/2005inventory.html#inventorydata. VA, April 2005. 37http://www.epa.gov/oms/locomotives.htm. 17 FHWA. Chapter 2, Assessing the Effects of Freight Movement on Air Quality at 38http://www.epa.gov/otaq/regs/nonroad/marine/ci/420f09068.htm. the National and Regional Level Final Report, prepared by ICF Consulting, 39http://www.epa.gov/oms/regs/nonroad/420f08004.pdf. Fairfax, VA, April 2005. http://www.fhwa.dot.gov/environment/freightaq/. 40FMCSA. Large Truck and Bus Crash Facts 2007. January 2009. 18EPA. National Emissions Inventory Data and Documentation, 2005. http:// 41FMCSA. Large Truck and Bus Crash Facts 2007. www.epa.gov/ttn/chief/net/2005inventory.html#inventorydata (accessed 42FMCSA. Crash Statistics, National Summary Report, http://ai.volpe.dot.gov/ September 25, 2009). CrashProfile/n_overview.asp (accessed November 9, 2009). 19 Figure provided by the American Trucking Associations. 43 For example, large-truck crashes that result in a towed vehicle, an injury, or 20 FHWA. Chapter 2, Assessing the Effects of Freight Movement on Air Quality at a fatality. the National and Regional Level Final Report, prepared by ICF Consulting, 44FMCSA. Large Truck and Bus Crash Facts 2007. January 2009. Fairfax, VA, April 2005. http://www.fhwa.dot.gov/environment/freightaq/. 45 FRA, Office of Safety Analysis. Table 5.11, Highway/Rail Incidents Summary 21 FHWA. Chapter 2, Assessing the Effects of Freight Movement on Air Quality at Tables, http://safetydata.fra.dot.gov/officeofsafety/publicsite/Query/gxrtab. the National and Regional Level Final Report, prepared by ICF Consulting, aspx (accessed October 30, 2009). These statistics were generated from a Fairfax, VA, April 2005. http://www.fhwa.dot.gov/environment/freightaq/. query of a FRA database at this site. 22 FHWA. Chapter 2, Assessing the Effects of Freight Movement on Air Quality at 46 FRA. Research Needs Workshop, July 1416, 2009, http://www.fra.dot.gov/ the National and Regional Level Final Report, prepared by ICF Consulting, us/content/1735 (accessed November 13, 2009). Fairfax, VA, April 2005. http://www.fhwa.dot.gov/environment/freightaq/. 47 FRA, Office of Safety. FRA Guide for Preparing Accident/Incident Reports. 23 EPA. Energy (chapter 3), in U.S. Greenhouse Gas Inventory Report, 2009. Effective May 2003. http://www.epa.gov/climatechange/emissions/usinventoryreport.html. 48 FRA, Office of Safety. Crossing Inventory Data File Reconciliation (CIR), 24FHWA. Highway Stats, 2007. http://safetydata.fra.dot.gov/CIR/Default.aspx (accessed November 1, 2009). 25 EPA. Energy (chapter 3), in U.S. Greenhouse Gas Inventory Report, 2009. 49http://www.fhwa.dot.gov/policy/2004cpr/pdfs.htm. http://www.epa.gov/climatechange/emissions/usinventoryreport.html. 50http://www.fhwa.dot.gov/policy/2006cpr/pdfs/cp2006.pdf. 26 One teragram is equal to one million metric tons. 51 Surface Transportation Board Decision STB Ex Parte No. 558 (Sub-No. 12) 27 EPA. Table ES-2, Executive Summary, in U.S. Greenhouse Gas Inventory Railroad Cost of Capital -- 2008 Decided: September 24, 2009. Report, 2009. http://www.epa.gov/climatechange/emissions/usinventoryre- 52 FRA. "Freight Railroads Background", a briefing paper on America's freight port.html. railroads accessed Feb. 15, 2010, http://www.fra.dot.gov/downloads/policy/ 28 Energy Information Administration. Table 19, Energy-Related Carbon Di- freight2008data.pdf, p.4. oxide Emissions by End Use. In Report: An Updated Annual Energy Outlook 53 Stover, John F. American Railroads, 2nd ed. University of Chicago Press, 2009 Reference Case Reflecting Provisions of the American Recovery and Rein- Chicago, Ill, 1997, p. 153. vestment Act and Recent Changes in the Economic Outlook. http://www.eia. 54 Railroad Accounting Principles Board. Final Report, vol. 1 (1987). doe.gov/oiaf/servicerpt/stimulus/excel/aeostimtab_19.xls (accessed Novem- 55 STB Ex Parte No. 558 (Sub-No.12), http://www.stb.dot.gov/Decisions/ ber 13, 2009). ReadingRoom.nsf/UNID/524C43CE35BD8E2F8525763C00428C4A/ 29FHWA. Highway Stats, 2007. $file/40078.pdf. 30 Fuel consumption data are provided by the U.S. Department of Energy, En- 56 Cambridge Systematics, Inc. National Freight Rail Infrastructure Capacity ergy Information Administration and Investment Study (prepared for the Association of American Railroads), 31 US EPA. Draft Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990 Cambridge, MA, 2007. 2009, 2011 Table 2-15. 57USACE. The U.S. Waterway System--Transportation Facts, Nov. 2008, p. 3. 32 US EPA. Draft Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990 58USACE, U.S. Waterway System, p. 3. 2009, 2011 Table 2-15. 59USACE, Challenge: Marine Transportation System, 2000, US Army Corps of 33EPA. Inventory of U.S. Greenhouse Gas Emissions and Sinks, Report EPA 430- Engineers briefing paper to accompany public outreach sessions related to R-09-004, April 15, 2009. the future of the Marine Transportation System.