Minutes of a Public Meeting

 

MINUTES OF A

DEFINITION OF NEEDS, RESOURCES AND REVENUES

MEETING OF THE

GOVERNOR’S TRANSPORTATION VISION 21 TASK FORCE

9:04 a.m., Tuesday, April 25, 2000

Arizona State Capitol

Executive Tower

Phoenix, Arizona

The Definition of Needs, Resources and Revenues Committee of the Governor’s Transportation Vision 21 Task Force met in official session for a meeting at 9:04 a.m., Tuesday, April 25, 2000 with Chairwoman Barbara Ralston presiding.  Other members in attendance were Vice Chairman John Mawhinney, Steve Basila, Robert Bulla, Joe Herrick, Gary Knight, Jim Simmons, Lela Steffey, Frank Thorwald and Martin Shultz.  Also present were Mary Lynn Tischer, Alan Maguire, Chuck Eaton and John Carlson, Governor’s Transportation Advisor.

Welcome

Ms. Ralston called the meeting to order at 9:04 a.m.

Acceptance of Minutes for October 27, 1999

Action:            A motion to approve the minutes from the October 27, 1999 meeting was made, seconded and carried unanimously.

Update on Work of Consultants

Mr. Maguire provided an update of the work being performed by the consultants.  He stated that Booz Allen Hamilton, in their capacity as a needs consultant, has been primarily focused on constructing a comprehensive and internally consistent database of system requirements for the State over the next 20 years.  He stated that they have done this by accumulating all of the previously prepared needs documents.  He noted that they have identified 9,800 projects that they are calling Priority One documents.  He stated that they have also identified Priority Two, Three and Four documents that occurred prior to 1990.  He explained that their next step is to look for duplication and to verify that the projects have not already been built.  He stated that the consultants will work with Ms. Tischer, the Planning Department at ADOT and the District Engineers to identify projects that have already been built and projects that have not even gotten to the preliminary design stage.  He stated that the consultants would also speak with the Transportation Director and other representatives of the MPOs and COG’s.  He noted that six of the eight most expensive single projects are high-speed rail MAG level electric projects along the Phoenix-Tucson corridor.  He explained that the database is not meant to provide a sum total of projects, but an array of alternatives that the Committee can choose from.

Mr. Maguire provided his observations stating that Booz Allen got off to a slow start because they assumed there would be more information immediately available then there was.  He stated that the number and magnitude of the projects, given the size of the State also surprised them.  He said that they have reallocated their resources and are now back on schedule.  He noted that their expectations for assigning attributes to the projects are optimistic, but they will begin to try to classify and categorize projects by performance measures discussed at the last meeting.

Mr. Thorwald asked if the costs for particular projects are representative of the real costs.

Mr. Maguire stated that that is a complex problem because, depending on the source documents being used, there are different degrees of reliability.  He noted that the documents also range in age and the construction market has tightened in recent years, making older estimates less accurate.  He also pointed out that not all jurisdictions include the same costs in an estimate.  He suggested that they could begin to establish rules for altering the costs based on these factors.  He stated that the consultant has been applying reasonableness tests to the various estimates.  He noted that larger projects are more likely to have had refined analysis and, therefore, will have a smaller margin of error.

Mr. Thorwald asked if the database would include Tribal information.

Mr. Maguire stated that they have received some data from the Tribes, some of which is very detailed, some of which is non-existent.  He noted that the Navajo’s have provided very comprehensive data.

Mr. Bulla commented on the consultant’s surprise at the number and magnitude of the projects in Arizona and questioned if that suggests even more of a shortfall in transportation funding throughout Arizona compared with other states like California.

Mr. Maguire stated that it is also because Arizona has grown so much and has a fairly large percentage of the system outside ADOT and the MPO’s control.

Mr. Thorwald suggested that a lot of duplication would indicate a waste of engineering and staff time.

Mr. Maguire stated that that would not necessarily be true because one study may have led, and actually become part of, a larger study.

Ms. Ralston asked Mr. Maguire to identify the next level of deliverables from the consultants.

Mr. Maguire stated that they would see output from the needs database being created by Booz Allen in approximately 45 days.  He stated that Wilbur Smith has completed a draft of Report 1.  He explained that Report 1 is an analysis of existing revenue streams that they are expanding to include non-highway revenues.  He anticipated that that report would be completed in June.  He stated that they are also working on an analysis of alternative revenue sources.  He stated that they have identified 15 to 20 alternative sources, some of which are predictable and measurable.  He suggested that it would be helpful to distribute that list of alternatives to the Committee members before the project is finalized.  He noted that Booz Allen is also working in the capacity of analytical consultant and their first major task under that assignment is to develop a review of Arizona specific issues that apply to transportation.  He stated that they are asking Booz Allen to bring a lot of other state’s expertise and make it fit Arizona.  He stated that they have started compiling various types of socio-economic data for Arizona and he expects this to be completed in mid-May.

Ms. Steffey asked if the consultants would have different recommendations depending on whether ballot items that will effect revenue pass or not.

Mr. Maguire stated that they have asked the consultant to do an analysis on the VLT issue and to provide alternatives depending on how the vote goes.

Mr. Shultz asked Ms. Steffey if she believes the VLT issue will get on the ballot.

Ms. Steffey explained that voters are for anything that reduces taxes.

Mr. Thorwald noted that there have been recent gas hikes and suggested that, should prices continue to go up, the application of alternative fuel resources will accelerate.  He asked if the consultants are looking at income sources other than those related to fuel.

Mr. Maguire agreed that that is becoming an issue.

Mr. Thorwald referred to a handout he provided regarding direct and indirect sources of revenue.

Mr. Maguire stated that he would review the handout.

 

Discussion on ADOT’s “Life Cycle” Financial Management System

Mr. Chuck Eaton provided a brief history of the Life Cycle Program.

Mr. Maguire noted that they are discussing this program because one of the goals decided on at the retreat was to establish a comprehensive management system similar to this one.

Mr. Eaton continued with his presentation defining the objectives of the program, which include reflecting a fiscal balance between anticipated revenues and expenditures and providing the necessary management tools to ensure realistic planning and construction schedules.  He noted that, since they have started, they have not had to delay projects because of financial problems.  He explained that the components necessary for setting up a life cycle program include a dedicated funding source, established priorities and a set program timeframe.

Mr. Eaton reviewed the Regional Freeway System January 2000 Certification Map.

Mr. Bulla asked what percent of the original plan is included in the current plan.

Mr. Eaton explained that the original plan was for 230 miles, whereas the current plan has 144 miles.

Mr. Carlson noted that they are preparing documents that compare what was promised to the voters to what is currently being done.

Mr. Mawhinney asked for an explanation of the difference between Loops and Interstates and if they are funded or approved differently.

Mr. Eaton stated that the original plan was to fund all of it with a $.05 sales tax, which was not adequate to fully address the system.  He stated it was at that point that the State started to apply for Federal funding.  He suggested that if the State had planned for full federal funding from the beginning they probably would have gotten an interstate designation.

Mr. Shultz stated that the document referred to by Mr. Carlson is important because it allows them to learn from the historical facts.  He suggested that the quality of construction of the new system is better even though the number of miles has reduced.  He asked when the document would be available.

Mr. Carlson offered to provide a copy of the current document.

Mr. Eaton stated that they would work on updating that document immediately.

Mr. Maguire pointed out the segments that are no longer included, including the 303 and Paradise Parkway.

Ms. Steffey pointed out that they have invested in the 303 and stated that it should be shown on the map.

Mr. Carlson stated that the State Transportation Board agreed to turn the 303 over to the county and it is designated as a State Route.

Mr. Eaton stated that they still maintain any funds expended with the $.05 sales tax in their certification and it still reflects any money spent on the system to date.

Mr. Shultz left the meeting at 9:50 a.m.

Mr. Eaton stated that he has been asked if the Life Cycle Program could be used on statewide projects.  He compared the two programs and explained that it might be difficult to apply the Life-Cycle approach to the statewide program.  He reviewed the budget for the Regional Freeway System totaling $4,570,000.  He explained that the Regional Freeway System Office, Administrative Service and Risk Analysis Process make up the management of the Life Cycle Program.  He stated that the remaining costs are related to the administration of designs and preparation of projects for construction and the management of the projects on a day-to-day basis.

Mr. Bulla asked what the costs would be if the program were expanded statewide.

Mr. Eaton explained that costs for a statewide program would be similar for similar sized programs.

Mr. Thorwald asked how they deal with fluctuations in land costs.

Mr. Eaton stated that they do their best to predict it as part of their risk analysis.  He noted that zoning changes can effect the cost of land, therefore, they try to predict when vacant land will be zoned for something that would be at a much higher price.

Mr. Thorwald suggested that purchasing land early would offer savings.

Mr. Eaton stated that that is true as long as the market continues to grow.

Mr. Simmons asked if ADOT does the Life Cycle Management process for the statewide system.

Mr. Eaton explained that the Life Cycle program is only used on the Regional Freeway System.  He stated, however, that they do try to predict revenues.

Mr. Carlson noted that the statewide program is based on a five-year program whereas the regional program is tracked from the beginning of a project to the end.

Mr. Simmons asked if they are efficiently monitoring the statewide system.

Mr. Mawhinney stated that the idea is to look at expanding the system statewide.

Mr. Maguire stated that pieces of the program are used on the statewide system, however the state does not do much in terms of long-term expenditure forecasting.

Ms. Ralston stated exploring this issue is a focus of this committee.

Mr. Simmons asked if the $1.8 million cost includes expanding the monitoring.

Mr. Maguire stated that the costs to expand statewide would be similar to this project.

Mr. Eaton noted that the number of projects could also affect administering costs.

Ms. Tischer pointed out that the major difference is that the Regional System is closed, whereas the State’s five-year program is continuous.

Mr. Eaton noted that the State does not define priorities beyond five years.  He suggested that if they had a 20-year long-range plan that set priorities, they could structure major components of that plan as life cycle programs.

Mr. Carlson noted that the Legislature passed Bill 1534, which requires ADOT to publish a 20-year plan by 2003.  He also pointed out that the Planning and Programming Committee determined that more money is necessary for advanced acquisition.

Mr. Eaton stated that a lot of the money in the general consultant contract is for the development of preliminary plans to a degree that would allow the right-of-way to be set.

Mr. Basilla suggested that the five-year program has not been seen as credible because projects have slipped or been pulled off the board.  He questioned whether staffing issues played a part in not being able to maintain the plans put forth.

Mr. Eaton expressed his opinion that project managers, who are key in delivering projects, are short staffed.

Mr. Carlson noted that Planning and Programming has asked ADOT to determine how much it would cost to move identifying the right-of-way footprint up to 30 percent of planning.

Mr. Mawhinney suggested that it is also a governance issue and should be under the control of the Regional MAG rather than the State.

Mr. Eaton explained that the Regional Freeway System is a joint partnership between ADOT and MAG.  He stated that changes have been made in how they program in the region due to TEA21 requirements that the state and the MPO work together to identify and prioritize projects.  He suggested that they are moving closer to planning the region as a whole.

Ms. Steffey stated that the State should be involved because the freeways are being turned over to the State when completed.

Mr. Eaton agreed.

Mr. Eaton continued his presentation with a review of the Life Cycle Program opportunities and benefits.  He noted that MAG performs an independent review of what has happened during the year to ensure that the program has carried out their responsibilities.  He concluded by identifying three recommendations: using ADOT’s long range plan to identify Life Cycle opportunities, linking new funding to specific improvements and determining the timeframe for the completion of improvements based on funding availability.

Mr. Thorwald noted that when building a project there would be speculation that increases land costs and, therefore, determines where developments will go in.  He suggested that if the State could more effectively support those developments and, in turn, the developers could support the projects through taxes or paying for intersections, the State could get some type of supplemental subsidy they are not currently getting.

Standardization of Data Collection and Reporting

Ms. Tischer and Mr. Maguire reviewed a handout they created and provided to Committee members entitled Standardization of Data and Methodologies used in Transportation Planning and Reporting.

Mr. Mawhinney asked if there are any states that excel in terms of standardization.

Ms. Tischer stated that Federal law requires that TIPS be taken whole into the STIP, therefore it is less of an issue in many states.  She noted that there are a number of states that are attempting to do something similar, however she has not seen a model.

Mr. Thorwald stated that in areas where there are variations in growth, POPTAC does not work well and asked how they address that issue.

Mr. Maguire agreed that population estimates are complex in Arizona, however, he stated that he believes POPTAC has helped to improve the quality of forecasts.

Mr. Thorwald suggested that there is a reluctance to reevaluate data and compensate for changes in growth.

Mr. Maguire stated that they annually update statewide and county totals, however, the further they get away from the census, the harder it is to obtain information.

Mr. Thorwald noted that the evaluations affect more than transportation.  He explained that developments decide whether or not to come to an area based on the population.

Ms. Ralston stated that identifying what is in data is not helpful and that she would like the Committee to come out with a recommendation that would force uniformity and make it easier to understand.  She asked if other Committee members agreed.

Mr. Mawhinney agreed.

Mr. Carlson suggested that the Committee look at Washington State as a model, explaining that they have had a statute for almost 20 years.  He stated that their state law requires that plans submitted on the local level be compatible with the state’s plans.

Mr. Simmons asked if the consultants could come up with recommendations and alternative methods of standardizing data.

Mr. Thorwald stated that standardization, conformity and uniformity are fine, but there needs to be flexibility because of the impact it can have on revenue and economic development.

Mr. Bulla stated that the principal is that, whatever they do, it should be consistent.

Ms. Ralston suggested that the Committee would like validation by the consultants of suggested alternatives and recommendations.  She noted that the importance of the data cannot be overlooked, however, their role is to define resources that can support multimodal and transportation needs throughout the State.  She suggested that they need to stay focused on the task assigned to them.

Mr. Bulla noted the importance of ensuring that the data is accurate.

Mr. Mawhinney asked if the consultants would come back to the next meeting with recommendations for the committee’s consideration.  He stated that the Committee could then take their recommendations to the full Task Force.

Mr. Maguire stated they would come back with more formal recommendations.

Call to the Public

Ms. Ralston opened the meeting up for public comment.  There were no comments.

Mr. Mawhinney expressed his frustration over what has been accomplished to date.  He suggested they do not have enough time to accomplish what they have been asked to do and stated that he fears they are merely extending the old planning system.  He expressed concern over the passage of the rail tax and suggested that the Legislature will be hard pressed to pass the necessary tax increases.  He questioned whether they are spending the appropriate amount of time and effort looking at how to better serve the 90 percent of the people who commute.

Mr. Thorwald stated that he has the same concerns.

Ms. Ralston asked if it would be helpful for the Committee to have a retreat similar to the one the Task Force had.

Mr. Maguire suggested that it would be helpful if they could have a brainstorming session.  He stated that they would be happy to research any preliminary concepts the Committee comes up with.

Mr. Carlson stated that he could devote more time at the June 7 meeting to looking at how to make the system more efficient.

Ms. Ralston stated that they continue to look at how to alter the old system rather than how to revolutionize the system.

Mr. Thorwald agreed that they should have a meeting where they could brainstorm.

Mr. Bulla stated that the public would have the perception that the Committee wasted the last two years if they do not produce something that results in improvements to their way of life.

Mr. Simmons stated that they are at the point where they wonder if they can come up with a recommendation.  He suggested that Booz Allen could look at the main objective of the Committee and to come up with alternative plans based on their experience.  He questioned how the Committee could solve these issues on their own.

Ms. Ralston noted that the RFP was for specific items.  She asked if other subcommittees are experiencing the same level of frustration.  She explained that her frustration is that no decisions are being made.

Mr. Maguire explained that his responsibility is to help the Committee form recommendations and, therefore, he has been reluctant to bring forth formal recommendations of his own.  He suggested that a retreat might help the Committee determine what they feel is important.  He stated that the Planning and Programming Committee has made good progress, in part, because there is a lot of best practice information available.  He noted, however, that the Governance Committee is also feeling frustration and is struggling with the complexities of their issues.  He stated that he expects that Committee to be able to make recommendations by June.

Mr. Carlson noted that a lot of the difficulty faced by the Governance Committee is that they are somewhat dependent on tax issues.

Ms. Ralston asked if the staff is looking at what needs to come from each subcommittee by the December 7 Full Task Force meeting.

Mr. Maguire explained that one of the Committee’s biggest problems was that it took almost an entire year to get the consultants.  He stated that the incremental steps they have taken will eventually contribute to the final recommendation, however, they will have a short period of time to put those pieces together.

Mr. Mawhinney questioned how they could expect people to support the Committee’s long range goals without addressing the issues that effect them on a daily basis.  He suggested that if they address those issues, the public would feel confident in supporting the long-range goals.

Ms. Ralston asked the staff to identify some short-term and long-term alternatives.

Mr. Thorwald reiterated the need for a brainstorming session.

Ms. Ralston stated that she would get with staff to determine alternate dates for a brainstorming session prior to the June meeting.

Mr. Maguire offered to provide alternative recommendations.

Mr. Herrick also expressed his frustration.

Mr. Simmons asked if the consultants could meet with the Committee to help identify alternatives.

Ms. Ralston stated that she would discuss that suggestion with the staff.

Adjourn

The meeting adjourned at 11:16 a.m.

BARBARA RALSTON, Co-Chairperson