Sunday, April 05, 2009

Gas tax, roads, and low-bids in contracts

While searching for the lowest and best price has its merits, consider this:
The dilemma of modern construction is summed up in an anecdote that Wernher von Braun, the scientist who developed the U.S. space program, used to tell about John Glenn, the first American to orbit the earth: “Seconds before ­lift­off, with Glenn strapped into that rocket we built for him and man’s best efforts all focused on that moment, you know what he said to himself? ‘My God! I’m sitting on a pile of low bids!’
I wish I had read the essay from where I have excerpted the quote, before I submitted the following op-ed to the Statesman Journal:
I was reminded of Johnny Carson’s quip, “I did not know that,” when I read that 90 years ago, on February 25, 1919, became the first state in the union to implement a tax on gasoline sold at the pump.

The tax of one cent per gallon was based on a simple and straightforward idea that construction and maintenance of roadways ought to be paid for by their users. Oregonians intentionally chose this, and not a general tax on the population. What a novel idea for that time period, when automobiles were still being thought of as horseless carriages by many in this country and elsewhere!

As automobile usage increased, other states and the federal government also followed up with gas taxes. Now, when we purchase gas in Oregon, the price for every gallon at the pump includes state and federal taxes, which have gone up over the years, to keep up with inflation and the phenomenal increase in automobile and truck traffic. Local governments have the authority to charge additional taxes as well. Of course, there is a comparable tax on other types of fuel too.

That same year, in 1919, Dwight Eisenhower participated in the army’s exercise to study the logistical issues in moving military vehicles and equipment from coast to coast. It was this, together with his war-time experiences in Europe, which later led Eisenhower to call for a national system of highways when he was elected to the presidency.

The two unrelated events of 1919 continue their influence on us even today, through gas taxes and a complex network of federal and state highways. At the same time, we are also in the middle of intense public policy discussions related to gas taxes, and the conditions of the roadways that seem to be rapidly deteriorating.

According to the National Surface Transportation Infrastructure Financing Commission, America’s transportation infrastructure is falling apart—sometimes literally. In its report to Congress, the Commission recommended implementing a mileage-based fee system by 2020, with modest increases in federal fuel taxes in the meanwhile in order to get out of “the hole we have dug for ourselves.”

Well, the forward thinking public policy pioneers that Oregonians are, we have engaged in an interesting discussion over the last couple of years on precisely this same idea of charging road users not by the gallons of gas bought but by the miles travelled in the state.

However, to a large extent, such discussions are not entirely new. Almost 15 years ago, I was a junior participant in similar policy discussions in my earlier career as a transportation planner in Southern California. Even then, there was very little disagreement on the state of roads and bridges—this was well before the catastrophic bridge collapse in Minneapolis in the summer of 2007, which served as a tragic reminder to those who were in denial about the state of the transport infrastructure.

Thus, after years of deliberations, I am ready for action, once we climb out of these depressed economic conditions. At least before the centennial of the gas tax?

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