Minneapolis Regional Chamber of Commerce, Critical Issues Forum Charlie Zelle, Commissioner Minnesota Department of Transportation.

Minneapolis Regional Chamber of Commerce, Critical Issues Forum

Charlie Zelle, Commissioner Minnesota Department of Transportation

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Moving goods▪ Value of freight moved in MN -- 2007 $1 trillion▪ Rail carries 240 million tons of freight▪ MN handles 480,000 tons of air cargo annually

Connecting us to recreation▪ ~8 million people visit MN state parks

annually▪ 40 million annual visitors to MOA

Getting us to work and school▪ Average Minnesota drives

15,000 miles a year

50% state highway pavements over 50 years old

35% of MnDOT bridges over 50 years old

Almost 9% of bridges structurally deficient

MN 9th most extreme temperature variations in the nation

Overall, state highway pavements rank 38th in the nation

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•Purchasing power declined 30% since 1988 (despite ’08 gas tax increase)

•Half the ‘08 gas tax increase was dedicated to debt service

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Under MnSHIP, the 20-year spending plan, pavement will worsen by 55% through 2024 and then gets even worse

Interrupted service results in millions lost per day, to business

Congestion may increase 30% per person Infrastructure repair dominates funding outlook –

new projects less likely

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Identified Minnesota’s transportation funding needs the next 20 years

Needs outpace revenue projections

Identified $50B in investments over the next 20 years, all modes, to create economically competitive system

For roads and bridges alone there is a $12B funding gap

Status quo: No new funding or investments Maintain performance: An additional $5B in

funding to maintain system performance at current levels

Economically competitive: To serve a 21st century economy, TFAC recommended an additional $12B over current levels

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Metro Area Multimodal Vision

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What’s the ROI for maintaining the current performance?

What’s the ROI for spending more on improvements to help become more economically competitive?

Which kinds of projects offer the highest ROI?

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$5B invested over 20 years to maintain current performance delivers $10B - $23B in benefits (ROI 3.1)

Additional $7B over 20 years (achieve world-class system) gains $15B - $19B in benefits (ROI 2.1)

Projects with the highest ROI: ◦ Active Traffic Management, ◦ General Congestion Mitigation ◦ and Safety Spot Improvements 12

The team drew on MnDOT expertise as well as national best practices to establish ranges of typical returns for 10 investment categories

13Source: Technical memo, project team analysis

Ranges of ROI for each investment category

Mapped TFAC investment categories (4) to MnSHIP investment categories (10)

STEP 1 Drew on empirical evidence to establish ranges of returns

STEP 2

Vehicle operating costs Travel time savings Safety benefits Lifecycle costs

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Maintain current performance◦ Incremental investment $5B◦ Average benefit $16B

Economically competitive and world class◦ Incremental investment $7B◦ Average benefit $14B

Total = $12B investment, $31B average benefit

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Active Traffic Management, 8.9 Congestion Mitigation-General, 5.5 Safety Spot Improvement, 4.1 MnPASS, 3.5 Pavement Preservation, 2.0 Bridge Repair, 1.5 Pavement Reconstruction (urban), 1.4 Capacity Development, 1.2 Bridge Replacement, 1.0 Pavement Reconstruction (corridor), 0.9

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Population expected to increase by almost 1 million to over 6.1 by 2030

Twin Cities area expected to grow twice as much as rest of the state

Truck freight will increase by 30% Baby boomers will start turning 80 in 2025

(need for more transportation options) Millennials demand a more multimodal

system

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Enhancing, connecting communities

Supporting businesses, contributing to economic benefits of MN

Taking care of what we have

Careful management of limited state resources