Minutes of a Public Meeting

 

MINUTES OF THE REGULAR MEETING
OF THE
DEFINITION OF NEEDS, RESOURCES AND REVENUES COMMITTEE

9 a.m., Thursday, May 20, 1999
Arizona State Capitol
Executive Tower
Phoenix, Arizona

The Definition of Needs, Resources and Revenues Committee met in official session for a Regular Meeting at 9 a.m., Thursday, May 20, 1999, with Chairperson Barbara Ralston presiding. Other members present were Steve Basila, Robert Bulla, Joe Herrick, Gary Knight, Valerie Manning, John Mawhinney, Martin Shultz (ex-officio—arrived at 11 a.m.), Jim Simmons, Lela Steffey, Frank Thorwald, and Steve Wheeler. Also present were Alan Maguire, John McGee, Dale Buskirk, John Carlson and Stephanie Bondeson.

Pledge of Allegiance, Welcome, Acceptance of 4/22/99 Minutes

Ms. Ralston called the meeting to order and all present joined in the Pledge of Allegiance.

A motion was made by Ms. Steffey to approve the April 22, 1999 minutes as written. The motion was seconded by Mr. Wheeler and carried unanimously.

Ms. Ralston announced that Mr. Ingo Radicke had been appointed to the Task Force to replace John Hudson. Mr. Radicke will serve on the Governance Committee.

Ms. Ralston discussed a change in the committee’s meeting format from a classroom-style atmosphere to more of a two-way dialogue atmosphere. This change was instituted in light of the amount of work the committee must accomplish. All staff resources were to be represented at meetings to answer committee questions. Further, Mr. Alan Maguire was brought on as a consultant to the Task Force, and Ms. Ralston welcomed him. Ms. Ralston announced that Suzanne Sale had retired and been replaced by John McGee.

Review and Discussion of Existing Needs Information

Mr. Buskirk provided a detailed overview of the 1995 Arizona Transportation Needs Assessment, which focused on four major categories: highways, transit, rail and aviation. He outlined the caveats to be considered as the committee members review the numbers. Most importantly, the analysis of the assessment is based on 1993 data, and the revenues and costs are presented in 1993 dollars. He reviewed the numerous changes that have taken place in Arizona that affect the needs assessment in terms of public transportation. He reviewed the composition of the Technical Advisory Committee that oversaw the needs assessment. Mr. Buskirk discussed Arizona’s population projects through 2015, the 1993 and 1993 roadway mileage figures and 1993 and 1997 vehicle mile travel statistics. He presented and discussed maps of the 1999 state highway system, the functional classification system, 1999 levels of development, and transportation corridors of statewide significance.

Ms. Ralston asked if there was any significance in the fact that the travel percentage statistics are so similar (1993 compared to 1997). Mr. Buskirk explained that the significance relates to the distribution by roadway function classification, and the consistency would be expected if the roads were correctly classified. A conclusion can be drawn that demand has increased significantly, but the roadway miles have increased only slightly. The state saw a .5 percent increase in miles and a 16 percent increase in traffic, resulting in more congestion.

Mr. Buskirk explained that state designated routes are not designated as part of the state highway system. It is a transition category and a legal designation not a function classification. The State Transportation Board would have to vote to formally incorporate the roadways into the system.

Mr. Buskirk discussed the strategies the department has used to address the scarcity of funds as compared to needs. ADOT is in the process of developing long range development plans for the corridors of statewide significance. He stated that ADOT has completed corridor profiles on all high priority corridors. He stressed the importance of prioritization and the focusing of the investment made in the state’s highway system.

Mr. Buskirk presented financial data on the state highway system costs, county road system costs, city street system costs, highway revenue forecasts, total state, county and city financial needs for roadways, total transit financial needs and total rail financial needs. With respect to aviation, Mr. Buskirk presented the historical and forecast air passenger demand figures, a forecast on commercial aircraft operations, the total financial need to maintain existing level of aviation performance, and the total financial need to bring all airports to minimum guidelines.

The minimum financial need of Arizona’s Transportation System for 1996-2005 is $9.8 billion. The maximum financial need of Arizona’s Transportation System for the same period is $11 billion.

Mr. Simmons asked if transportation studies prepared by MAG and PAG were included in the needs assessment figures, whether those entities had input into the figures presented and if MAG and PAG agree with the financial need figures. Mr. Buskirk explained that MAG and PAG were used as partners in the needs assessment process, although their studies were not included. The entities do not necessarily agree with the results of the needs assessment. The needs assessment was prepared for the legislature as required by state statute. He emphasized that the needs assessment did not take into consideration the possibility of passenger rail service between Phoenix and Tucson, and this service would significantly increase the total needs.

Mr. Mawhinney asked why the operating and maintenance costs were reduced in the second half of the study period. Mr. Buskirk explained the assumption that if a state has a well-maintained system, it will take less money to continue to maintain it to the standards set forth. Minimum maintenance standards are based on roadway classification and design. He explained the rationale for using the standards determined by the cities and counties as opposed to national standards. He confirmed that the standards used are lower than national standards. He stressed that safety is the primary concern of any provider of transportation facilities. He explained the formulation of safety standards. With respect to this needs assessment, the state did not dictate to cities and counties how to define their needs. The basic methodology was self-assessment, which assumed that the participants knew their systems best.

Ms. Manning asked what methodology was used for identifying corridors of significance. Mr. Buskirk explained that there are several acceptable methods for assessing needs. The technical advisory committee was specifically tasked with approving the methodology used. The methodology used to identify significant corridors included in part: functional classification, level of development of highway, number of commercial vehicles using the route, importance of road to specific destinations, volume of traffic and seasonality. Mr. Maguire clarified that the corridors of statewide significance information was separate from the needs assessment. He explained how the high priority corridors are selected by the State Transportation Board. Mr. Buskirk stressed that with insufficient revenue, it is important to identify routes where the state needs to focus its investment.

Mr. Wheeler asked if Mr. Buskirk were able to venture a guess of what the state’s current needs/deficit would be. Mr. Buskirk suggested that if the number were adjusted for inflation, cost increases, and needs not reflected, it would be closer to $15 billion. He said that the problem with a needs studies is that the number is so great no legislature could deal with it. Mr. Buskirk confirmed that it is reasonable to assume the number would be in the $15-20 billion range. Mr. Bulla suggested that one could easily triple the number and be within logical planning needs today. He stressed the need to be planning and implementing for those estimates today. He thought the numbers were frightening, especially when considering safety standards. Mr. Buskirk commented that a 20-year needs assessment was felt to be not particularly meaningful.

Mr. Thorwald asked how the limited aviation funding impacts the state. Mr. Buskirk answered that it has the possibility of dampening air traffic growth. When the carrying capacity of any mode of transportation reaches the upper limit, a provider must look at other modes. For example, Texas is looking at high speed rail versus air transportation.

The meeting was briefly recessed at 10:22 a.m. and reconvened at 10:35 a.m.

Mr. Simmons commented that the $11 billion figure is the most important figure the task force will address. The credibility of the figure is very important and needs to be updated to take into consideration 1999 dollars and needs. He was worried that the needs study is a compilation of estimates by various entities, i.e. cities and counties. He asked if there was an objective source that could look at and verify the figure. He stressed the need for the task force to be comfortable with the figure, or it has failed in its goals. Ms. Ralston agreed that this is a critical component of how the task force moves forward. In response to a comment by Ms. Steffey, Ms. Ralston stated that it would be difficult to create a statewide long range plan without considering local needs and revenue sources. Mr. Buskirk explained that the executive order addresses the issue and directs the task force to include costs and revenue estimates for local jurisdictions.

Mr. Thorwald stated that some of the cities in the state do not have the tax base to maintain their roads. He asked how the deficit would be impacted if all roads were brought up to current standards. Mr. Buskirk answered that the impact would be significant, but he could not even guess what the number would be.

Mr. Basila asked what percentage of the needs is attributable to right-of-way. Mr. Buskirk answered that he did not have that level of information. Mr. Basila commented that the credibility of the subcommittee hinges on finding an accurate number that reflects the transportation needs in the state. Mr. Buskirk emphasized that the agency is not in the process of updating the needs assessment numbers.

Ms. Steffey said that as a legislator she was very confident in the state’s numbers at the time the needs assessment was done, but not the other numbers.

Review and Discussion of Preliminary Revenue "Matrix"

Preliminary Review and Discussion of "Missing Revenue Information"

Mr. McGee reported on the Arizona transportation revenue sources by program and by recipient. He discussed the forecast parameters used at the federal, state and regional levels. He noted that federal funds are available only on a reimbursable basis. He explained that while there is some transportation funding by other federal agencies, ADOT has no specific information except possibly in the area of public transit. He agreed to look at these sources and how the data might be gathered.

Mr. Simmons suggested that if ADOT were going to include costs associated with local programs, it needs to include revenues as well.

Ms. Steffey mentioned the cities that have passed transportation related taxes.

Mr. Thorwald pointed out that tribal funding sources were not disclosed. Mr. McGee responded that these sources do exist, but ADOT does not have the data. Mr. Thorwald stated that the BIA has offered to provide the information. He further suggested that staff look into the Federal Parks funding for roads. Mr. Buskirk noted that this could be significant, i.e. the Grand Canyon Transportation Plan. He confirmed for Mr. Mawhinney that the reservation needs were included in the needs study.

Mr. Thorwald asked if studies had been done on the potential impact of toll roads or tolled HOV lanes or on privatizing the system. Mr. McGee answered affirmatively, explaining that the state has had several proposals, but none of them moved forward. The proposals were for very specific projects. There is one privatization study underway on tolling HOV lanes, but it has not been completed. Mr. Thorwald suggested that perhaps this type of data might be available from other states or at the federal level.

Mr. McGee continued with his presentation, discussing the projection and forecast assumptions used for Arizona’s transportation revenue sources. He stated that long-term projections and forecasts assume no tax increases at the legislature.

Mr. Thorwald commented that he has only found one community that does not have problems with the DES population projections. He referred to the number of communities that are impacted by seasonal residents. He asked how those problems are addressed in the distribution of funds. Mr. McGee stated that the distribution of funds is set by state statute. Mr. Shultz commented that planners in urban areas would have the same concerns, i.e. influx of winter visitors. Mr. Thorwald suggested that this issue be looked at broadly.

Mr. Thorwald asked if there are any studies available on how transportation needs might be impacted by the Internet and other communication tools available in today’s society. Mr. Buskirk indicated that there has been a great deal of discussion of the impact of communication technology, but states are still seeing increases in travel miles. Mr. Shultz stated that he has written letters to Bill Gates and Craig Barrett asking them if they could provide resources to address the impact of technology on transportation trips. He will also be writing a letter to G-Speed Clusters asking them about the impact of technology as they envision the future. He offered to send copies of the letters to the committee members.

Ms. Ralston left the meeting at 11:30 a.m., and Mr. Mawhinney presided over the remainder of the meeting.

Discussion of Committee Work Process

Mr. Maguire provided a brief overview of an outline of a preliminary committee work process. He said he would be adding "Freight and Passenger Requirements" under other modes in Phase Two.

Mr. Thorwald suggested that the committee also consider the impact of technology as it moves forward and new funding vehicles, i.e. Colorado’s bonding use of federal monies.

Mr. Mawhinney suggested that the state needs to use a rigorous, unitary set of standards for the purpose of planning and needs assessment.

Closing Remarks and Preview of Next Meeting

No information was presented.

Adjournment

The meeting adjourned at 12:06 p.m.

BARBARA RALSTON, Chairperson