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From page 22... ... The conceptual difficulties in defining freight capacity, which can be clarified by applying the efficiency criterion, are also discussed. The important immediate government policy issues affecting freight capacity are identified in the next section, and selected recent statements and proposals on basic policy issues related to freight capacity from government, past NRC committees, and others are reviewed in the final section. Read the entire page →
From page 23... ... The cost of freight transportation services includes congestion, environmental costs, and accident costs. Application of the efficiency criterion implies that the private sec tor should be relied upon to provide transportation systems and services except in certain defined circumstances where the market cannot produce efficient results. Read the entire page →
From page 24... ... Department of Transportation's (DOT's) 1996 National Freight Transportation Policy Statement, which sets forth "prin ciples of federal freight transportation policy" that include allocation of federal resources to cost-effective projects supporting national goals, removal of unnecessary regulation, efficient pricing of publicly financed transportation infrastructure, assurance of safety and environmental protection, application of technology advances to promote efficiency and safety, and satisfaction of defense needs (DOT 1996) Read the entire page →
From page 25... ... . The NRC study Inland Navigation System Planning: The Upper Mississippi River�Illinois Waterway points out demand management tech niques for the inland waterways, including congestion pricing and use of tradable lockage permits, and recommends that the government evaluate these techniques as alternatives to physical capacity expansion (NRC 2001, 3�4) Read the entire page →
From page 26... ... 128) The Problem of Defining Freight Capacity Because this study considers the outlook for freight transportation capacity, some measure of capacity might seem indispensable. Read the entire page →
From page 27... ... The definitions suggest that measuring capacity in manufac turing is actually not much simpler than in transportation. Measures of capacity in the freight transportation industry could be developed by methods analogous to those used to develop the Federal Reserve indexes. Read the entire page →
From page 28... ... Therefore, analysis to support government decisions on transportation system investment, operation, and regulation should emphasize determination of trends in costs and the nature of any con straints that are forcing costs to rise. IMMEDIATE POLICY ISSUES AFFECTING FREIGHT CAPACITY Freight transportation is an ongoing joint venture of government and the private sector. Read the entire page →
From page 29... ... In the following sections, each of these issues is defined, and its implications for long-run freight capacity are outlined. Management, Operation, and Regulation Decisions in this area relate to the rules that government applies to the users of freight transportation facilities, for example, traffic controls, economic regulation, and environmental regulation. Read the entire page →
From page 30... ... 51111_22_493/31/03 4:56 PM Page 30 30 Freight Capacity for the 21st Century BOX 2-1 PENDING GOVERNMENT DECISIONS AFFECTING FREIGHT CAPACITY Government management, operation, and regulation of transportation: � Truck performance regulation (size, weight, safety, pollution) � Railroad economic regulation � International aviation regulation � North American Free Trade Agreement freight transportation issues Selection of funding sources for capital expenditures and operation of public facilities: � Harbor dredging funding � Toll funding of highways � Future of user fee finance in state highway programs � Port rate competition Public investment choices: � Structure of federal-aid programs � Evaluating freight benefits in setting investment priorities � Public-sector technology development programs � Future development of the inland waterways system � Application of environmental regulations to infrastructure projects Redefining government responsibilities: � Air traffic control reform � Government grants to freight railroads Read the entire page →
From page 31... ... limits were liberalized, an efficiency gain would be assured only if each truck's user fees covered the cost of the truck's use of the roads; otherwise, increasing limits could give rise to uneconomic demands on the road system and render highway agencies less able to afford maintenance and construction. As will be described in the section on funding sources, federal estimates indicate that combination trucks, on average, pay user fees nearly equal to the expenditures highway agencies incur to serve them, although the heaviest combinations tend to pay a smaller share of their costs and fees are not tied closely to the costs of individual movements. Read the entire page →
From page 32... ... . Federal regulatory policy has had great consequences for rail freight capacity. Read the entire page →
From page 33... ... Lower costs would lead to more air cargo, but the system would be better able to respond to growing demand. North American Free Trade Agreement Freight Transportation Issues The 1994 North American Free Trade Agreement requires the United States, Canada, and Mexico to seek harmonization of regulatory stan dards in order to allow free operation by transportation companies across the borders. Read the entire page →
From page 34... ... External costs of a freight shipment include the costs of the pollution, congestion, and accidents caused by the shipment, beyond the portions of these costs borne by the shipper and carrier. External costs are relevant to the freight capacity problem in several ways. Read the entire page →
From page 35... ... The mechanisms chosen to finance projects and to collect revenues from users and others will pro foundly affect freight transportation system performance. The structure of user fees determines whether the best use is derived from existing facilities, and finance practices influence the quality of investment deci sions. Read the entire page →
From page 36... ... An alternative policy, which would reflect a fundamentally dif ferent perspective on the public interest in providing freight capacity, would be to reduce the availability of external funds to ports, forcing them to be more self-sustaining. Increasing user fees could provide additional funding for justifiable port improvements. Read the entire page →
From page 37... ... The resolution of the dredging funding issue may have broad impli cations for the federal role in freight and for transportation infrastruc ture finance principles. The user fee/trust fund mechanism has been used in the United States for highways, inland waterways, ports, and avi ation. Read the entire page →
From page 38... ... None of the arguments that might be cited in support of the redistri bution of funds among elements of the system through the highway trust fund applies in the case of seaports. Port user fees would all be collected at individual ports, and for particular services or facilities used at indi vidual ports, and most ports are administratively autonomous. Read the entire page →
From page 39... ... Some trends in user fee finance have positive implications. In the most recent federal highway cost allocation study, which compares the user fee payments of various classes of highway users with the highway agency expenditures that may be attributed to each class, user fees paid by operators of combination trucks (the principal freight-carrying vehi cles) Read the entire page →
From page 40... ... Future of the Inland Waterways System Characteristics of the inland waterways system include aging infrastruc ture, great disparities in the ratios of operating and capital costs to traffic volume among the various waterways that make up the system, erratic federal funding for capital expenditures in recent decades, and growing traffic with occasional heavy congestion on certain segments. Although a towboat fuel tax contributes, historically federal general revenues have paid the majority of capital and operating costs (USACE 1997, ES-7� ES-23, 4-1�4-10, F-2�F-9) Read the entire page →
From page 41... ... The issues may include whether to continue the established federal role in transportation finance, project eligibility requirements for federal aid, the structure of user fees, and the role of local government in project selection. Proposals will be made for provisions to target more spending on projects important for freight transportation. Read the entire page →
From page 42... ... Air Traffic Control Reform A TRB committee that reviewed the performance of the air transport industry in the first decade after deregulation concluded in 1991 that there were grounds for concern "about the ability of the FAA [Federal Aviation Administration] in its current form to meet future challenges posed by continued air traffic growth. Read the entire page →
From page 43... ... This program and another provision of TEA-21, the Transportation Infrastructure Finance and Innovation Act (for which exclusively rail projects are not eligible) , were seen as institutionalizing the kind of federal freight project credit assistance that Congress has pre viously provided specially to the Alameda Corridor port access project in Los Angeles (DOT 1998, 1�3) Read the entire page →
From page 44... ... RECENT POLICY STATEMENTS The committee took advantage of several recent statements from promi nent sources that analyzed public policy problems related to provision of freight capacity and recommended changes in government policy. Noted were specific policy proposals of these groups as well as the eval uation criteria and principles concerning responsibilities of government in freight transportation that guided conclusions. Read the entire page →
From page 45... ... Each of the statements is summarized in the appendix. All the statements reviewed agree that the social benefit derived from freight transportation could be increased through changes in government transportation programs. Read the entire page →
From page 46... ... Examples are recommendations for supplementing or replac ing federal grants with cost-based user fees that incorporate peak pric ing, privatizing air traffic control and ports, reducing the environmental regulatory burden by using pollution taxes and tradable emissions quo tas, and promoting competition by removing barriers to foreign carriers and facilities. Incrementalists and activists argue that laissez-faire provision of freight infrastructure is impractical because government is already responsible for major infrastructure components and this institutional arrangement is not going to change soon. Read the entire page →
From page 47... ... 1996. National Freight Transportation Policy Statement. Read the entire page →
From page 48... ... In Special Report 252: Policy Options for Intermodal Freight Transportation, TRB, National Research Council, Washington, D.C., pp. Read the entire page →
From page 49... ... 1996. Special Report 246: Paying Our Way: Estimating Marginal Social Costs of Freight Transportation. Read the entire page →

From page 22...

... The conceptual difficulties in defining freight capacity, which can be clarified by applying the efficiency criterion, are also discussed. The important immediate government policy issues affecting freight capacity are identified in the next section, and selected recent statements and proposals on basic policy issues related to freight capacity from government, past NRC committees, and others are reviewed in the final section.