February 26, 2008

Of Harris County Metro Ridership statstics and private provision of public transportation

In today's edition of Houston's newspaper of record, transportation beat writer Rad Sallee notes that Harris County Metro has achieved record boardings. I had noted that a while back on Tory's blog, but I have yet to post the latest boardings statistics on my spreadsheet. Fare collection is also up. In general, I like this.

The easy explanation for this is that we have $3 per gallon gasoline. I posted my observations on Metro and posed an observation to an internet board which I belong to in conjunction with another poster's remarks that transit ridership for SEPTA in Philadelphia is also up, mostly on its commuter routes. The observation I posed was, whether price increases in gasoline or other transportation fuels will drive increases in transit patronage, and if so then how much?

The result was a fascinating conversation which centered around such issues as the marginal rate of substitution of motor vehicle use to transit, the income elasticity of demand, and the cross price elasticity of demand for transit use. The general thread of the discussion centered on the marginal cost of transit trips.

The level of discussion was of a far higher quality than that which I normally encounter when visiting local internet boards and blogs, given that fair number of these people are transportation professionals and journal published Ph.D's with no particular ax to grind. Well, they have no other ax to grind other than the simple wish to spend public monies only if absolutely necessary, and then as cheaply as possible lest their profession be given a really bad name. Many of these people are outraged at some of the projects which have been fobbed off on the taxpaying public.

The result of my posting of the Metro statistics and the other gentleman's SEPTA story from Philadelphia resulted in a discussion thread that went something like this:

One of the opening posts in the discussion thread was made by Steven Polzin:

In general gas prices would be a meaningful mode choice factor for a small number of all travelers and their impact on overall ridership could easily be overwhelmed by local factors such as economy, service changes, fare changes, parking cost changes, etc. Remember some of the impact of gas prices is not economic but folks showing a concern about global warming, energy independence, sending more $ to the mid east etc. that influence decisions. Thus part of the impact of high gas prices, to the extent that it exists, may bean emotional response not an economic one. The media and to a lesser extent the industry have fed a perception that gas prices have/will contribute to greater transit ridership. Looking at the numbers would suggest caution when setting these expectations.

The thread of the discussion went into such topics as how much to people value their time verses what amounts of money they were willing to pay in order to get somewhere more quickly and conveniently. Discussion also centered on whether longer transit trips were part of the equation of increased transit patronage.

Mills and Hamilton cited that Keeler and other researchers in the 1970's whose work indicated that people valued their commute time at roughly 30 - 50 percent of what their wage rates were. Charles Lave came to a similar conclusion which he published in this 1979 article in The Atlantic an article which discussed the high gasoline prices of the era when combined with various governmental laws which rationed gas through price ceilings and caused people to wait in line for gas instead:

But an increase in waiting time is, in fact, an increase in the real cost of gasoline: studies of transportation choice have established that commuters are willing to pay about 40 percent of an hour's wage to save an hour of travel time. That is, the increase in waiting time was equivalent to a real price increase of 50 to 100 percent, and motorists responded by reducing their weekday travel by about 15 percent. If this had continued, their long-term response would have been even greater since they would have had the time to make more important adjustments, such as changing automobiles or residences.

Mills and Hamilton go on to state that people value wait times, transfer times, and access times at much higher rates than those of times actually spent in transit. In particular, they state that wait times for vehicles are absolute killers for patronage, being put at some 2-4 times greater than one's average wage. Clearly one way to increase transit patronage is to make sure wait times are cut down to a minimum. The other is to find ways to increase the travel speeds of the vehicle, perhaps through bus routes with fewer stops or through dedicated bus lanes. It also points to the idea that people are willing to pay some rather high fuel prices before giving up their vehicles.

But what about the idea that higher fuel prices will cause people to abandon trucks and cars and instead patronize mass transit? One big clue for whether people will do this can be to see what has happened in Europe. This BBC story from 2003 indicated that outside London, only 11% of British people got to work by public transport, only 5% of commuting was by national rail. Only 3% cycled to work, while one in 10 walked. Prices for gas in Britain in 2003 were about $6.50 per gallon, while today they are about $7.50 - $8.00. The per capita income in Britain is some 10-20 percent lower than here in America, so there is not a terribly great difference on the income elasticity of demand figures.

Intriguingly, Metro's increased patronage numbers may be coming from the fact that since Houston has a booming economy, Houston may be drawing in more poor people in addition to wealthier income groups. In article in the New York Sun, noted urban economist Edward Glaeser writes that New York draws a lot of poor people and he states that one of the reasons why it does is because it has a large public transportation network. In a more formalized paper published recently in The Journal of Urban Economics (which I subscribe to), Glaeser speaks more thoroughly to the issue of the role of public transportation drawing people to cities and urbanizing poverty. Amongst the amazing interpretations of a model he works through, he writes that:

Let WRich be a rich person's opportunity cost of time, F be the fixed time cost of public transportation, and C be the fixed time cost of driving you get:


Alternatively, if WRichF < C then some rich people will take public transportation. In this case, a four ring city can be one outcome. In the inner ring, the rich take public transportation. In the next ring, the poor take public transportation. In the third ring, the rich drive and there may be a fourth ring where the poor drive.

Glaeser finds that proximity to public transportation does well at predicting the location of the poor in cities.

My thought is that if fuel prices were to increase to circa $7-10 per gallon, that Metro's patronage figures would increase from 4-5 percent of work trips to perhaps an overall range of somewhere around 10 percent. Perhaps Metro's annual boardings would increase to 200-300 million per year from the 100 million they are at now. However, those numbers are still not enough paying passengers to enable Metro to stand on its own two feet.

This is frustrating to me because my real dream for public transportation is that I want public transportation to be able to pay for itself and not have to be considered something that can only be provisioned by government. Houston had private bus service operated by Bernard Caulkins all the way into the early 1970's, when the Arab oil embargo caused gas prices to climb 4 times. That in turn required a doubling of fares which caused patronage to drop by one third. Still, despite a sales tax regime that approaches half a billion dollars, Metro struggles to draw as many riders as Mr. Caulkins did in the 1960's. Once Metro was voted into existence, one of the first items on the agenda was to start building trains everywhere. Since then, we have gotten so used to this crap that nobody anywhere ever seems to have remembered how the world once really was.

Private provision of public transportation would destroy the rationale for taxation. It would also:

1) Put paid the question once and for all as to whether rail or buses are cheaper to own and operate.

2) Destroy the rationale for the 1,500 foot radial condemnation zones around train or BRT stations that Metro now wields and the potential for political corruption.

3) Put an end to the ever twisting and changing rationales that the public wants out of public transportation. Instead, a private actor would simply concentrate of providing good service and making a profit while moving people from one place to another. Tory alluded to this when he wrote:

Metro is a public agency subject to the will of the voters. It started out as subsidized alternative transportation for the poor and disabled. Then people wanted commuting alternatives (the HOV buses). Then they wanted local rail. Now, given the local boom of $100 oil, they'd like to see some freeway congestion reduction by attracting more riders out of their cars.

4) In a similar vein, getting government out of the provision of public transportation would put an end to the political battles where various groups try to capture the agency for their own purposes, whether they be money and patronage, urban reengineering, downtown groups wanting rail lines to cover up for the fact that their property is expensive, for shelling out to run rail to airports through neighborhoods where Metro previously refused to place more bus stops because of a lack of patronage, $300 million intermodal transit temples, or any other idea they may come to mind.

5) Public transportation would not be considered a jobs program with the specter of unionization by government workers who can't lose their jobs.

6) A private bus company would probably buy cheaper equipment and look to do things like put maps at bus stops. We would no longer see large 50 seat buses running around empty anymore.

7) One thing people might remember was that in 1955, Rosa Parks refused to give up her seat on a bus that was operated by a private bus company. Blacks then protested the bus company by refusing to use the company's services. If blacks were to try that same political tactic today over some issue, Metro could care less. It doesn't help that the Black elite of today is in on the handouts for contracts.

8) The compadres at BlogHouston would not have Dick Nixon Metro to kick around anymore. I could write about more interesting issues, like when cellulose ethanol will become economically viable as a transportation fuel.

More than anything, privatizing public transportation would take the politics out of the equation, which would bleed off all of the intensity of the entire debate.

And so it goes. It's getting late and tomorrow's another day.


Posted by The Mighty Wizard at 02:35 AM
This entry was posted in the following categories: Houston and Texas matters , Transportation

February 17, 2008

Where rail really works and what the Interstate system did for America.

On February 13, 2008, the Wall Street Journal published a fascinating story on a largely unnoticed revolution going on in American transportation. American railroads are, for the first time in a century, making massive new investments in their infrastructure. Better yet, not one dime of the $10 billion (with $12 billion more planned) is coming from public coffers. From the story:

For the first time in nearly a century, railroads are making large investments in their networks -- adding sets of tracks, straightening curves that force engines to slow and expanding tunnels for bigger trains. Their campaign is altering the corridors of American commerce, more so than any other development since interstate highways spread to the interior.

The story goes on to say that this burst of new private development of railroads has been driven by a massive burst of finished consumer goods coming in from Asia. These goods add to the usual cargo that freight rail carries, such as coal, grain, and chemicals. Compare all of this to the slovenly inefficiencies of Amtrack or light rail inner city transit. Moving goods is cheap. Moving people - at least in the economically affluent part of the world - is expensive.

This development, the story goes on to say, is generating development along the pathway of the railroads, but the development is primarily commercial in nature. Also, the railroads and freight trucks complement each other, where trucking companies find that sometimes they can ship goods long haul over rail rather than doing it over the Interstates.

And speaking of the Interstates, I was reading a story in this weeks' issue of The Economist of China's massive spending on transportation projects. The print edition carries a side story on the effects that America's Interstate Highway system had on productivity while it was being built. The Interstates were initially estimated to take 12 years to build at a cost of $25 billion. At the end, it took 37 years and cost (in 2006 dollars) $425 billion.

Question: Was it worth it? According to Ishaq Nadiri and Theo Manuneas, yes it was. America went through its greatest and most long lasting economic boom during its history after WWII and the Interstates had quite a bit to do with raising that productivity and making America a vastly wealthier country. Broadly speaking, Nadiri and Manuneas say that the greatest gains were reaped early on in the program and declined slowly as time went forward. The gains of the late 1950's were 31 percent of America's economic productivity growth, 25 percent by the late 1960's, and down to 7 percent by the late 1980's as more money was spent on road maintenance. One out of every five dollars was also being siphoned away from road building to build rail transit and bike paths. Freight costs in 32 of 35 industries dropped by an average of 24 cents for every dollar spent on the system.

Could something similar to the Interstates been done privately? The Interstates had incorporated into them some 14,000 miles of toll roads, mostly in the Northeast. Conceivably, a far seeing Governor and Legislature in some states could have launched state wide initiatives using toll roads, but it would have taken multi state cooperation to achieve a similar result to the Interstates. As it is, now that the Interstate system is complete, I wonder whether it would not be such a bad thing to turn most of it over to the states and either curb or shutdown collection of the federal gasoline tax the way that the Republican Congress of 1994 wanted to do? Entertaining ideas.


Posted by The Mighty Wizard at 06:06 PM
This entry was posted in the following categories: America , Money and finance , Transportation

February 11, 2008

Houston and The Urban Land Institute Report

Well, well, well. The Wizard suffered a cratered hard drive a number of days back and subsequently found that his available backups were not exactly up to the task of restoring their contents. Sigh... life goes on.

As it is, my quality of life has returned to its normal excellence, all without a dime of taxpayer monies or time wasted with worthless political rhetoric. Some of this was achieved by shopping this weekend at three of my favorite places, Frys, Borders, and Home Depot. I also purchased two new pairs of running shoes from a place I have done business with for nearly 20 years.

And speaking of worthless rhetoric, On Thursday, February 7, 2008, Houston's newspaper of record published the findings of a panel of so-called experts from the Urban Land Institute and their ideas for Houston's future. Tory writes about it here. I am on a fresh install of Windows as I write this, so I cannot access the PowerPoint of the group's "findings". Still, I shall deal with their points as made by the Chronicle and Tory.

1) Houston needs more housing in downtown.

Answer: The marketplace will answer that question, not a panel of people who possibly might have been hired by some downtown Houston landowners and interest groups, conceivably at taxpayer expense. As it is, the 3,500 or so people who live in downtown Houston live in housing whose cost gradients are going for at least $235 per square foot, if not higher. The office space in downtown Houston currently has gradients of $275 or more per square foot. Meanwhile, would be homeowners can buy in some areas within 10 miles of downtown Houston which have price gradients of $70-$90 per square foot. Doing so and driving a car into downtown saves them many thousands of dollars every year in housing costs. As such, the Wizard believes that the market for housing in downtown Houston is probably saturated and will remain a small niche market. The same market forces which left downtown dormant after nightfall as late as the late 1990's have returned to some degree and will probably stay that way. Funny, but some people who have written about this don't seem to understand this idea.

Meanwhile, there is no compelling reason why Fry's, Home Depot, or other companies should locate downtown. Doing so would put them at a cost disadvantage vis-a-vis with their marketplace competitors. Land is valuable thanks to the agglomerated economies of scale afforded via the construction of skyscrapers, which allow dozens or hundreds of firms needing office space to bundle together (like law firms who would like to be just down the street from the City and County government and court houses) and outbid manufacturers or retailers for access to downtown property via renting floors of such towers. Moreover, for many there is no compelling reason to locate near downtown for access to the port or to rail heads, as there is no advantage to be found for most to do so.

2) Houston's competitors are (insert city here).

Houston's size, as is the size of most cities in a market economy (and yes, 1/3rd of the U.S. economy is in the political economy), will be determined by the size of its markets. The factor payments flowing into Houston thanks to $90 per barrel petroleum and $7 per 1,000 cubic foot natural gas are incredible. If you can't make some money right now, then there is something wrong with you. Naturally Houston should be expanding.

Still, it would be nice if we could attract some other non-fossil fuel firms, or if our current incumbents would show enough foresight to start buying up land so that they can control cellulose ethanol production from offices located in Houston. In general however, I am not a big believer in the idea that Houston is competing against cities like Sydney.

3) Houston should consider planning for its ad-hoc sewer system.

Ah! Now these guys are onto something. Staying on top of your infrastructure is a very wise thing to do. Too bad the political classes here in town seem more interested in building sports temples rather than deal with sewage.

4) Houston must start shelling out billions to run rail to the airports.

Oh, my goodness! If this one didn't give away who paid for this report, then I don't know what would.

The Metro Solutions 2003 ballot language called for the taxpaying public to shell out for rail to both Hobby and Intercontinental. Naturally, the rail lines lead to - you guessed it - downtown Houston. Tory's thread questions how far this would be. The Wizard works downtown and drove to Intercontinental in December 2006 when taking a business trip to London and onto Algeria. The distance of the drive along I-45? 25 miles. It took me 55 minutes in 5pm Friday evening rush hour traffic with 1 freeway accident to make it to Intercontinental. The Metro Solutions ballot language states that a hypothetical route would be 21.5 miles.

The cost of a light rail route to Intercontinental? That would be a minimum of $3 billion. We would be giving up a Katy Freeway refurbishment and expansion - all 18 lanes (with room for two more), 350,000 daily vehicle capacity, and tens of thousands of freight trucks - for such a project. Meanwhile, Metro stated in its 2006 North Corridor FEIS that the first 5.4 miles of LRT transit from downtown to Northline Mall would attract 15,000 riders per day.

Folks - shelling out for rail to the airports is a recipe for disaster. If the downtown interest groups - which in every expanding city are sick of people running away from them because sprawl makes their land less valuable - politically demand and insist on dedicated public transportation to the airports from downtown Houston, then build a pair of dedicated bus lanes to the airports and run buses along them. It will save the taxpayer a ton of money.

In a future post, the Wizard will give gentle readers some pearls of wisdom regarding the phenomenon of cities which have run rail to their airports.

5) H-GAC needs to distribute transportation dollars based on quality of life criteria.

I have a question to ask: Define quality of life for me? If shelling out billions of dollars to run rail to the airports results in more traffic congestion because that money was not spent on creative ideas like tunneling under freeways, then that results in a diminishing of my quality of life. One of the reasons why people have been sprawling outwards from urban cores for generations is to get away from the historically narrow streets and inadequate transportation infrastructure which existed in Central Business Districts. Sprawl helps alleviate congestion, not cause it. Anyone who doubts this should do what I did and spend a good 10 weeks in London (or better yet, Bangkok). There you will see the results of narrow roads from antiquity, complemented with dense development. Average speed of travel around London? Try 8-13 miles per hour.

Moreover, trying to insert language that transportation dollars should be doled out on non-quantifiable issues like "quality of life" detracts from dealing with concrete problems, such as measuring that a freeway is backed up for 8 hours per day and that vehicle traffic is slowed to 20-30 mph during those time frames. Maybe it is time that we should start considering adding some more lanes somewhere, right?

So the Wizard's verdict? I'd accept the recommendations on sewage and non-zoning and file the rest of this report into the rubbish bin. We'd all be better off for it.

More Fireballs, Lightning Bolts, and Hell Storms to come.


Posted by The Mighty Wizard at 09:29 PM
This entry was posted in the following categories: Houston and Texas matters , Transportation

February 05, 2008

The benefits of Boston's $15 billion Big Dig

I received the following email today. I will share it in its entirety, the only comment being that the Los Angeles MTA has spent $11 billion (inflation adjusted) on rail transit since 1985, only to achieve the same number of boardings it achieved 22 years ago.



Riding the Silver Line bus rapid transit from Boston Logan Airport into downtown Boston last weekend via a Big Dig tunnel -- a quick ride, on a bus with luggage racks -- got me looking at the transportation performance of the Big Dig project.

Answer, from recent professional presentations: enormous reductions in traffic congestion. Apparently, the traffic engineering in the new tunnels eliminates weaving and bottlenecks. T-Ops is working 24 X 7 with cameras and other sensors. b> The bottom line number is 62% improvement in traffic flow.

See recent illustrated document attached in pdf, an end-of-year edition of Peter Samuels' Toll Roads News - found here.

There is a Powerpoint presentation in PDF showing performance graphics by ITS engineer Dan Baxter from last October here.

Dan Baxter and Peter Samuels describe the financial mismanagement
as well.

For those who want more, there is lots of detail in this screen scrape of an article by the same Dan Baxter in Roads & Bridges magazine from June 2007.

Big believer

Despite setbacks, "Big Dig" potential benefits are stratospheric
- By Dan Baxter

This year marks the 25th anniversary of Boston's Central Artery/ Tunnel project, nicknamed the "Big Dig." Records of project planning activity date all the way back to 1982, and as of 2007 all sections of the project are now open to traffic.

More than $14.6 billion has been expended, and recent projections put completion closer to $15 billion. As with all highway projects, the Big Dig journey passed through planning to design, then on to construction and finally into operations and maintenance. The similarities with other highway projects stop there. The Big Dig has been unique in many ways, not all positive, including unparalleled cost escalations and highly publicized construction problems. Prior to completion, the only positive news has been a few construction achievements well known in the industry and the management of traffic during construction. New measurements and projections of project benefits are now available and an assessment of the true value of the project is possible. Even if the project does eventually achieve its original goals, will the highway construction industry ever see another mega project like the Big Dig? If there is another mega project with the scope and cost of the Big Dig, will it be managed differently based upon lessons learned? Looking back at the Big Dig, what really went wrong and what really went right?

True to traffic

With the final cosmetic touches now being put on the largest mega project in U.S. history, it is now possible for the first time to speculate how history will judge the project. As with every human endeavor, nothing is in reality a total success or a total failure. A Big Dig scorecard needs to consider costs, schedule, quality of construction and tangible benefits to the public. At a staggering $14.6 billion for 7.5 centerline miles of highway, the cost of the project is over $300,000 per inch. At that rate, achieving a positive benefit-to-cost ratio for the project will require unprecedented benefits. However, the facts emerging show the numbers may be closer than you might think.

The Big Dig has had more ups and downs than the numerous ramps that drop from the surface into the labyrinth of new subterranean highways. The most recent blow to the project came in August 2006 when a fatal accident resulting from a ceiling failure became the latest in a series of project problems to make national headlines.

Although it has been consistently maligned in its hometown newspaper, the news from the Big Dig is not all bad. Some monumental construction challenges have been met and mastered, including the soil freezing and tunnel jacking required to complete the I-90 extension to the new Ted Williams Tunnel. Now that the facilities are fully open to traffic, it is clear that the excessive daily traffic congestion and related air pollution that once gripped downtown Boston has been substantially reduced. A large portion of the vehicle delay disappeared with the giant concrete and steel elevated freeway that for two score years blackened the fourth-story windows of adjacent Boston buildings.

When it comes to traffic, the promise of the project planners to vastly improve traffic flow was kept, and even exceeded. A popular sound bite used by project critics during the design phase was "it will be obsolete the day it opens." Traffic data collected and compared with "before" conditions have proven the critics who voiced that position wrong. Dramatic reductions in travel time and increases in traffic flow have now been documented in a new study recently published by the Massachusetts Turnpike Authority (MTA). The study was conducted independently of the Big Dig construction management consultants. The study, titled Economic Impacts of the Massachusetts Turnpike Authority and the Central Artery/Third Harbor Tunnel Project, performed by the Boston-based international transportation and economics consulting group EDR, stated that "the original 1990 environmental projection was that the `Big Dig' would improve traffic flow by 40% by 2010. Today, the project exceeds that with a 62% improvement in traffic flow. This was accomplished while overall traffic volume grew by 23.5% since 1995."

Improved traffic flow is only one part of the picture. New public parks, reconnected neighborhoods, revitalized commercial activity and an aesthetic face-lift unparalleled in American municipal history have prepared Bostonians for a brighter socioeconomic future.The Rose Kennedy Greenway and the Zakim Bunker Hill Bridge will transform the path of the old Central Artery into an extraordinarily beautiful stretch of parkland crisscrossed by sidewalks and streets that reconnect the city to its waterfront. The bustling crowd of locals and tourists that can be seen every day walking about at the Faneuil Hall Marketplace will soon be able to stroll farther east through the R.K. Greenway to parks like Christopher Columbus Park that sit at the bay's edge. Dramatic increases in the value of downtown, South Boston and Seaport District real estate have been realized and are projected to soar with the completion of the greenway. As spectacular as the traffic improvements and urban area transformations may be, they are not sensational enough to capture national headlines. The Big Dig's unexposed benefits are every bit as real as the costs and problems so readily exposed by the broadcast media.

Sign from above

In spite of the realization of the key kept promises, the Big Dig is as beleaguered as ever, and new fears about structural integrity have eroded the public's perception of the project into a mired mess of mixed reviews.

After enduring more than a decade of political firestorms and media bashings, the past two years has seen a series of successful and meaningful ribbon cuttings. The opening of new tunnel sections and connector ramps, the world's widest cable-stayed bridge and numerous public parks only temporarily lifted the spirits of the remaining project partisans. Those spirits must certainly have fallen again with the concrete ceiling panel that killed a motorist last year. The tragedy started a new series of searing public commentary and politically charged lawsuits.

In the days following the disaster, Massachusetts Gov. Mitt Romney "knee-jerked," went on the offensive and publicly questioned the safety of the tunnels. As the top elected state official, his lack of confidence prematurely trumped lesser bureaucrats who were responsible for determining the actual cause of failure and dealing with the problems. The reaction was predictable if not understandable as the Big Dig has always been an easy target for criticism. Defending the Big Dig project in the light of this catastrophe might appear to be political suicide in the short term. However, joining the ranks of critics may erode long-term credibility when it is time to take credit for the benefits.

The accident that killed Milena Delvalle of Boston's Jamaica Plain was caused by the failure of an epoxy-based anchoring system that held a large concrete ceiling panel in place. Reports from the scene indicated that there was no evidence of epoxy on some of the anchors that were lying in the debris on the road. A cursory search of public project records reveals that ceiling panel installation methods have been the subject of claims and changes and formed the basis of a value-engineering effort managed by the management consultant, a joint venture of Bechtel and Parsons Brinckerhoff. The causes of the failure have been reported to be a deadly mix of poor workmanship, flawed inspection and questionable decisions by project management that ultimately reduced the factor of safety to save time and money.

The investigation found that the failed anchors were among the first to be installed using the epoxy method, with the implication not that the oldest anchors failed first, but that the first anchors were installed by crews inexperienced with the method. Although there is no way to prevent motorists from having accidents due to human error, there is no excuse for a purely structural failure due to nothing more than the weight of an element under normal stress conditions.

As each month goes by absent of more failures, the August 2006 tragedy looks more and more like an isolated problem. People in the construction industry know that history is peppered with tunnel collapses. Less than a month after the Boston accident, a highway tunnel linking the cities of Guangnan and Yanshan collapsed in southwestern China, trapping 25 workers. Unfortunately, like so many other "firsts," the Big Dig is the site of the only highway tunnel collapse in memory to occur shortly after the tunnel was opened to traffic.

Structural failures over the past two years provide a roadmap to the No. 1 thing that has gone wrong with the Big Dig. Since project inception, the highly privatized program management of the project has had amazingly minimal public-agency oversight, placing the true power of the purse strings and key day-to-day decision making in the hands of the management consultant.

Highway construction projects a fraction of the size of the Big Dig have had twice as many public-sector managers. Privatization itself is not the problem, because without privatization mega projects are not possible. The problem ensues when the privatized management is forced to operate outside their realm and role in order to fill a vacuum. When construction problems occurred, Boston political adversaries and the media have had the upper hand over the Big Dig management consultant, which is constrained both by its position as a private firm and its responsibility to deal in technical accuracy rather than shooting from the hip.

In the case of the tunnel leaks in 2004, the strong condemnation by the Boston Globe essentially went unanswered for six months. Six days is too long, much less six months. The Big Dig has needed both a political and a public-agency advocate empowered and motivated to respond quickly to quell the rush to judgment. Future mega projects need more than engineering and construction leadership. Advocacy in the ranks of the politically elected leaders and appointed agency heads must be cultivated and maintained to establish ongoing public confidence and accountability.

Money to move

The second thing that went wrong was the magnitude of the cost escalation. Some cost increases would be expected, but quadrupling costs point to either incompetence in estimating or intentional lowballing.

The reality of the Big Dig is that from the start, schedule compliance was favored over budget adherence. Management spent money to keep the project moving, knowing that failure to overcome obstacles in individual contracts would have a ripple effect throughout the project. In the mega project environment, the whole is split into many smaller parts that must fit together in both space and time. If one contractor's schedule slipped, several other contractors could claim a delay. Public-sector and political accountability also would have gone a long way to address the continuing issue of cost escalation. The decision to blame the management consultant for underestimating true project costs during project planning may have provided a convenient scapegoat to deflect political accountability. However, it also had the long-term detrimental effect of exposing the management consultant to media pressure to which it could not respond and eroding the public confidence in the privatized program management of the Big Dig.

When a technical problem occurs that rightly requires the management consultant's action, even their best efforts are met with skepticism. The lesson learned is that you can't have it both ways. If you use your program manager as a scapegoat in the media, you can't expect the public to accept your total reliance on him when problems arise.

Still glossy

The advocates of this project in the 1980s produced glossy brochures that focused primarily on elimination of the habitually congested elevated portion of I-93 in downtown Boston. One particularly powerful brochure was the "Now you see it, now you don't" piece that included a photo of the jammed Central Artery on the cover and an artist's rendering of a new park-like setting in the same location. The primary benefits described in detail were transportation related, and the secondary benefits described much more vaguely had to do with reconnecting neighborhoods" and creating new green space for Bostonians to enjoy. It is now possible to compare the promises of the project's visionaries with the realities of the as-built project.

A justification for the project was certainly that operation of the existing highway had become unacceptable by any standard. The 14-hour-long peak hour average speeds on the elevated Central Artery had dipped into single digits, reflecting one of the worst operational conditions in the world. Due to the extremely poor existing conditions, the contrast between the before and after conditions is truly dramatic and helps to justify the cost of the project.

The astounding results of the EDR study show dramatic improvements in average speeds and delays. As an example, the daily average travel speed for the old Central Artery northbound was 10 mph; the Big Dig quadrupled it to 43 mph. The average speed for all harbor tunnels (the new Ted Williams Tunnel plus the existing Sumner and Callahan tunnels) nearly tripled from 13 mph to 36 mph. These unprecedented improvements in traffic flow have the combined effect of reducing the daily hours of vehicle delay on these facilities a whopping 66% from 38,088 daily hours of vehicle delay in 1995 to 12,834 in 2005 after the Big Dig opened. The delay reductions for some individual minor movements were mind-boggling, such as the notorious bottleneck between Storrow Drive eastbound and I-93 northbound that improved by 81%. This was the site of an apartment building with a sign that read "IF YOU LIVED HERE YOU'D BE HOME BY NOW." The Big Dig decreased the average travel time through this segment from 16 minutes to less than four minutes. This perpetual traffic jam was as much a Boston landmark as the Old North Church, and now it is essentially gone. All of these numbers were achieved in spite of a growth in overall traffic demand reflected in vehicle miles traveled (VMT) of 13% in the same period.

Where did the traffic go? The traffic volume is still there. It has even increased. It is the delay that was eliminated, and this was the vision of the project. The true genius of this mega project has always been not just the replacement of decaying infrastructure, but the amazingly efficient transportation connections that the new viaducts, bridges and tunnels create that speed traffic flow throughout the metropolitan Boston region.

The Big Dig is essentially America's largest interchange. With these connections, the whole metropolitan highway system operated by the MTA finally functions as a system, and reductions of demand on formerly bottlenecked facilities abound. Traffic is better throughout Boston, not just in the project limits.

The EDR study projects that "these improvements are now providing approximately $167 million annually in time and cost savings for travelers. This includes $24 million of savings in vehicle operating cost plus a value of $143 million of time savings. Slightly over half of that time-savings value ($73 million) is for work-related trips and can be viewed as a reduction in the costs of doing business in Boston." The study points out that the promise of the original 1990 project documents used for the environmental assessment projected that the Big Dig would improve traffic flow by 40% by 2010.

In light of these improvements, is it possible to consider the Big Dig a failure? Unfortunately, if traffic were the only benefit, the astronomical project cost would make the Big Dig investment questionable in comparison with a more traditional reconstruction. The traffic analysis portion of the EDR report claimed that the completed project provides annual savings of $177 million (2005
dollars) in operating costs and delay reductions for roadway users. Although these numbers are impressive, based on traffic benefits alone it would take 80 years to break even (not considering the cost of a traditional alternative). In order to evaluate the true benefits of the Big Dig, the economic effects on real estate also must be considered.

Positive square feet

The historically volatile economy of the greater metro Boston region now sits at the near side of a new economic boom that will be fueled by nothing more than the subterranean superhighway brought by the Big Dig. In real estate, location is everything, and the Big Dig is transforming industrial wasteland choked by congestion into easily accessible high-end real estate.

The Big Dig will create an estimated 16 to 21 million sq ft of new commercial and residential development in the South Boston Seaport District alone. The EDR study stated that real estate projects already developed or in construction and planning total 10 million sq ft of office and retail space, including nearly 8,000 new housing units, reflecting $7 billion in private investment made possible by the Big Dig. The increase in property value is estimated to bring in as much as $120,000 million per year of much-needed property tax revenue. Combined with the prospect of future increases to toll revenue, this boost should help the commonwealth maintain its investment provided the dollars are properly appropriated to maintaining the roadways.

Given the history of Boston and the value of the adjacent Back Bay area, a man-made residential and commercial gold mine created from the swampy marsh south of the Charles River, there is no doubt that the market forces needed to capitalize on the Big Dig investment are converging and will drive the project's true value into the stratosphere within the next 20 years. With the concrete and steel canyon of the Central Artery being replaced by the Rose Kennedy Greenway, a remarkably beautiful property value engine that will provide a 180 swing in the aesthetics of downtown Boston, the project planner's commitment to keeping the air rights publicly owned will pay off 10-fold.

Another clear winner from the Big Dig is Boston's Logan International Airport. After years of steadily losing passengers to expanding airports in New Hampshire and Rhode Island due to the untenable travel time in the existing access highways and tunnels, Logan will solidify its position as king of the New England airports. The EDR study reported that access to Logan "is now easier for an added 800,000 Massachusetts residents who with the full opening of the I-90 connector to the Ted Williams Tunnel, now live within 40 minutes of the airport. Today, 2.5 million residents live within 40 minutes of Logan International Airport."

The Big Dig also delivered a massive shot in the arm for the New England economy. The cost of the cubic yards of excavation, new concrete and steel do not add up to $14.6 billion. The difference was corporate profits and job income. The Big Dig created nearly 50,000 jobs in Boston. Over 50 engineering teams and over 125 contractors received valuable contracts. Although some Boston
families paid dearly for the privilege to work on the Big Dig, the worker safety record was good. The Hegarty family in Dorchester lost their father, John, the first worker killed on the project after six years of construction without a fatality. Given the complexity and size of the project, the overall safety record of the project was far above average and provided unusually safe and high-paying jobs.

Touching the nerve

Recently, I sat in the $200 million Operations Control Center talking with Jim Murphy of the MTA, the man who is responsible for day-to-day operation of the world's most expensive labyrinth of tunnels, freeways, viaducts and tollways. Murphy spoke with sincerity in a serious tone about his job managing the facilities. He dodged no questions, admitting a few shortcomings of the project, but at the same time described the complexities and realities of this underground superhighway in a matter of fact way.

It may be hard for some to admit it, but the project worked. The Big Dig did what it was supposed to do, what it was promised to do. All the critics who lined up to say it would fail were wrong. The criticism of project cost escalations was justified, but the total value of the project to Boston will continue to exceed expectations. In an era when spending on a foreign war can be $2 billion per week, the cost of the Big Dig could be expended in eight weeks.

Baxter is North American ITS Director for Stantec.

Source: Roads & Bridges June 2007 Volume: 45 Number: 6
Copyright 2008 Scranton Gillette Communications

Final notes:

Speaking as one who often experienced Central Artery congestion in the 1970s as a part-time Boston resident, it's an impressive, albeit expensive human achievement. There was a 2006 journalistic celebration of the achievement as a reversal of urban renewal destruction in the Washington Post at



provides streaming live video of traffic in central Boston.

Posted by The Mighty Wizard at 06:31 PM
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