Senator Eliot Shapleigh - El Paso, Texas

M. Ray Perryman, president of the Perryman Group. (File photo: RGG/Joey Gomez)

WACO, June 4 - It’s all over—or is it? The Texas biennial legislative session mercifully closed this week amid cries of both congratulation and consternation.

Most legislators were pleased they had been able to accomplish much of the agenda presented them in January, but others were still concerned about the many important measures upon which they had failed to act. As a result, unfinished business may result in a special called session at some point in the future.

Of the various matters still on tap, perhaps the one that impacts the state to the greatest degree is transportation. Texas is facing historic challenges due to the significant increases in population, vehicles owned, and roads traveled across the state’s 79,000 miles of highways. During the past Memorial Day weekend, some 2.25 million persons in the Lone Star State were expected to make trips of at least 50 miles from home by car, bus, train, or air, an increase of some six percent over last year despite a sluggish economy. Nationwide, travel during this three-day period was expected to see a 1.5 percent hike. We continue to add well over 1,000 people per day to our transportation system.

Even beyond the needs of leisure travelers, transportation infrastructure is key to the ongoing vitality of the state’s economy. When the interstate highway system was developed in the late 1950s and early 1960s, little attention was paid to the potential for population booms and distribution needs. As a result, many of the state’s highways are suffering from heavy congestion, and some are in dire need of safety improvements. Mobility studies and regional planning entities consistently indicate that the increasing levels of congestion far exceed the current fiscal resources to accommodate.

Over the past several decades, Texans have moved away from urban work centers, thereby increasing daily travel time on the road, along with increasing traffic in smaller communities. With an addition to the state’s population of approximately 14 million people over the next 25 years and vehicle registration anticipated to experience a 214 percent increase, it is evident that the situation demands special attention geared toward meeting specific needs.

Among the key needs are improved safety measures and compliance with federally-mandated air quality standards. Air quality is directly affected by traffic conditions; mobile sources are responsible for the majority of local emissions of many harmful pollutants, and cars stuck in traffic contribute to the problem.

The transportation system in Texas is a significant asset to the state and can be quantified by development and preservation costs, as well as by the tax and toll revenues derived from it. Moreover, the level of highway development, especially in crowded corridors, directly impacts gains in economic efficiency.

Ongoing improvements in the Texas transportation infrastructure are crucial to the state’s economic health. Better transportation efficiency can improve profits for firms locating in the state, and mobility serves as a substantial incremental stimulus to the future prosperity of regional and state economies.

On the other hand, congestion can cause a number of problems for business such as impairing the ability of manufacturing concerns to use sophisticated inventory management techniques or reducing productivity as workers sit in traffic jams. For individuals, congested roadways can significantly affect perceived quality of life. The environmental consequences in urban centers are also profound.

Although this essential matter was considered by the lawmakers, no definitive decisions were forthcoming during their 140 days in Austin. In fact, due to last minute machinations, lawmakers ended up not passing the bill that extends the life of the Texas Department of Transportation beyond September 2010. It remains to be seen if this failure requires a special session or if some clever means can be found to keep the agency in place.

More fundamental, however, is the fact that $2 billion in bonds for new arteries were not approved, regional authorities were denied the ability to allow local elections to impose gasoline taxes to fund new facilities, and toll roads and public-private partnerships faced increasing opposition. In other words, we seem to be limiting options for solving the problems, yet the needs continue to escalate and virtually all available resources are absorbed by maintenance of what we have.

Economic growth and population expansion have left the Lone Star State with a crowded transportation system, particularly in major urban areas, a trend which is likely to continue. Prior studies by my firm and others indicate that the ongoing annual return on investments in major transportation projects is more than 30 percent per year.

Texas can ill afford to fall further behind in its transportation infrastructure. Thus, it is essential that major consideration be given to a variety of options for enhancing and expanding the myriad economic opportunities that are dependent on transportation. The future demands such action.

Dr. M. Ray Perryman is President and Chief Executive Officer of The Perryman Group (www.perrymangroup.com). He also serves as Institute Distinguished Professor of Economic Theory and Method at the International Institute for Advanced Studies.