The Federal Investment in Highway Research, 2006-2009: Strengths and Weaknesses - Special Report 295 (2008)

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Summary The need for innovation in the highway sector has never been greater. The highway system is under severe stress and grossly underfunded. The current spikes in energy prices could have profound effects on highway transportation, the consequences of which are poorly understood. Public- sector research programs are vitally important to the development of inno- vations and insights that can help the highway system serve the nation under these conditions, but these programs are also under severe stress. Congress made some good investments in the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU) and increased overall funding for research, development, and technology (RD&T). Even so, the constraints of highly detailed program designations and earmarking of research funds for specific recipients reduced funding— in some cases eliminating it—for other important research initiatives. The Technical Corrections bill of 2008 was helpful, but addressed only a few of the problems. This report presents the findings and recommendations resulting from the Research and Technology Coordinating Committee’s assessment of the highway research programs funded under SAFETEA-LU according to a refined list of the principles for research articulated by Congress in the pre- amble to the research title (Title V) (see Box S-1), as well as additional prin- ciples the committee believes are important in sustaining a vital highway research program. 1 

2 The Federal Investment in Highway Research 2006–2009: Strengths and Weaknesses BOX S-1 Principles for Research Based on Title V, SAFETEA-LU 1. The federal portfolio should cover the full innovation cycle, including the following: – Agenda setting, – Conduct of research, – Support of research and technology transfer by the states, – Sharing of results, and – Deployment (including education and training). 2. Justification for federal investment requires that – Activities be of national significance, – There be public benefit and suboptimal private investment, – Efficient use of federal funds by states and local govern- ments be encouraged, or – The activity be the best means to support federal objectives. 3. The content of the federal RD&T program includes the following: – Fundamental, long-term research; – The filling of significant gaps; and – Policy or planning. 4. Stakeholder input is addressed. 5. Awards are almost always made on the basis of competition and merit review. 6. Programs include performance review and evaluation. NOTE: This list represents a distillation of eight principles included in Title V to combine two principles that overlap and eliminate one that is not relevant to this report. 

Summary 3 MAIN FINDINGS The main findings of the committee’s assessment are as follows: • Despite the progress made in overall funding under SAFETEA-LU, high- way research programs are significantly underfunded compared with the level of investment in industry. Public and private highway research is funded at only about one-quarter the level of industrial research and development in the United States (highway RD&T represents only 0.9 percent of revenues provided to highway agencies, whereas indus- trial investment in RD&T is equivalent to 3.3 percent of revenues earned from sales). • Extensive earmarking (62 percent) of the Title V University Transporta- tion Centers (UTC) Program and additional earmarks scattered across Federal Highway Administration (FHWA) programs (equal to at least 18 percent of FHWA’s funding) violate the SAFETEA-LU principle of awarding research funds on the basis of competition and merit review. • The programs funded under SAFETEA-LU do not include all the con- tent areas Congress requested. Because of funding constraints in Title V, FHWA was forced to cut important areas of research in safety, opera- tions, planning and environment, and policy. Funding for research and data collection to support policy decisions was eliminated, and funding for planning was greatly reduced. Although funding is provided in certain other areas, such as deployment and technology transfer, it is at levels that are inadequate to the task. • The 50-50 matching requirement for the UTC Program biases this pro- gram toward highly applied research and away from advanced research that is one of the main rationales for having a university research program. • Because of funding constraints, FHWA has inadequate funds to fol- low through on commitments made in its Corporate Master Plan for Research and Technology to engage stakeholders more broadly in agenda setting, merit review, and program evaluation. • The Strategic Highway Research Program (SHRP) 2 adheres to all the research principles of Title V but is funded at only 36 percent of the level and for 2 years less than stakeholders requested. The downscaled program will not be able to meet all the goals originally envisioned. 

4 The Federal Investment in Highway Research 2006–2009: Strengths and Weaknesses MAIN RECOMMENDATIONS On the basis of its assessment and the findings presented above, the committee makes the following recommendations: 1. To the maximum extent practical, research funding should be awarded through competition and merit review. 2. All UTC funds should be awarded to universities competitively. The 50-50 matching requirement for UTC research should be reduced to a 20 percent university match to allow universities to conduct more advanced research. Competition should be open to all universities and not be limited by prior levels of transportation research activity. 3. The Exploratory Advanced Research Program should be continued. 4. The State Planning and Research Program should be continued. 5. Cuts in research in the areas of policy, safety, operations, and planning and environment at FHWA should be restored. Funding for research and data collection to inform policy decisions should be increased to meet pressing national needs. The surface transportation environment and planning research program should be authorized as a cooperative research program. In the planning area, additional funding for expand- ing data collection and improving regional travel forecasting models should be provided. 6. Congress should consider extending SHRP 2 for 2 years into the next authorization and funding it under Title I. (Under Title I, the funding would come from states’ construction budgets, which they have approved.) 7. Other research programs strongly supported by stakeholders, such as the Long-Term Pavement Performance Program and the Long-Term Bridge Performance Program, should be continued. 8. Adequate resources should be provided to FHWA to support a robust program for dissemination of research results to states, local governments, and private vendors. 9. Resources should be provided to FHWA to institute a process of ongoing priority setting for highway research that engages the entire highway community. The results of these efforts would inform all high- way research programs, improving their ability to focus on the highest priorities. 

Summary 5 CONCLUSION Even within current constraints, federal support for highway research is a sound investment. Publicly funded highway research programs have developed innovations that have resulted in longer-lived assets at lower costs, reduced environmental impacts, saved lives, and improved eco- nomic efficiency. Additional innovation will be needed to improve safety, reduce congestion, address environmental and energy concerns, and provide the quality highway system the nation’s citizens expect. Adop- tion of the recommendations in this report will provide the nation with an improved program that will yield even greater dividends. These addi- tional payoffs from research are urgently needed to meet the demands being placed today on the highway system.