Streetsblog Capitol Hill

The AP is reporting that for the first time since Harry Truman was president, the U.S. is a net exporter of refined petroleum products. In fact, fuel was the country’s top export in 2011, totaling $73.4 billion.

However, “the small positive net export balance on petroleum products is still completely dwarfed by the huge negative balance on crude petroleum,” wrote James Hamilton, an oil economics expert at UC-San Diego, on his EconBrowser blog. Last year, between January and October, the U.S. spent about $280 billion on 2.7 billion barrels of oil.

The news of the surge of U.S. fuel exports just solidifies oil’s place as a major economic driver in this country — it in no way indicates that we’re becoming self-sufficient producers. The U.S. adds value through the refining process and sells it abroad (buying from abroad almost the same amount) but for the raw materials, we’re still hopelessly hooked on foreign sources.

The U.S. is producing somewhat more crude oil, mostly in North Dakota, but is still importing enormous quantities of the stuff. We’re nowhere near closing the import/export gap on crude oil.

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Live in a town where bicyclists and pedestrians are personas non grata and buses get stuck in automobile congestion? Do you put on your walking boots only to find that your city’s street design conveys the message, “These roads were made for driving?” It’s time for a complete streets upgrade, then – but often, when concerned citizens propose accommodating other road users on the streets, local officials tell them it’s just too expensive.

Are complete streets really too expensive? According to Norm Steinman, planning and design manager for the Charlotte Department of Transportation, design elements to turn an incomplete street into one that accommodates all users are usually a very low percentage of the total cost of street planning, design, and construction. “Sidewalks will turn out to be somewhere around 3 percent of that compilation of costs,” he said last week in a seminar sponsored by the National Complete Streets Coalition for communities participating in the CDC’s Communities Putting Prevention to Work program. “Bicycle lanes, around 5 percent — and that’s adding bicycle lanes, of course, to both sides of the street.”

“On the other hand,” Steinman said, “reducing the width of a lane by a foot can reduce the costs by 2 percent.” Indeed, in Richfield, Minnesota, when 76th Street needed to be rebuilt following work on the sewer lines, the city decided to implement a “road diet.” Narrowing the street shaved $2 million off the estimated $6 million cost of the sewer work – while at the same time improving mobility and safety for pedestrians and cyclists and making for a more enjoyable community.

The National Complete Streets Coalition suggests four points to help local transportation officials understand that complete street goals can be achieved without exorbitant costs:

Complete streets add lasting value. From safety improvements to public health outcomes, economic growth and lower emissions, and – of course – more transportation choices, complete streets can create a lot of value in the community. Many of those things can be quantified and even monetized. Be careful when telling transportation planners about health care savings, though: National Complete Streets Coalition Director Barbara McCann warns that since those planners are responsible only for their own budgets, hospital savings may not be enough to convince them.

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White Flint, Maryland, a suburb of Washington, DC, should be a shining example of transit-oriented development. It’s centered on a metro station on the busy red line, sandwiched between the bustling suburban downtowns of Bethesda and Rockville.

But instead, it’s “sprawling suburbia,” covered in surface parking lots and lacking a true road network. “Community members say they’re within spitting distance of White Flint Mall but they have to drive to get there because of the road network,” says developer Francine Waters, who manages the transportation and smart growth program at Lerner Enterprises.

Seeing the wasted potential of the area, Lerner and five other developers that own much of the land in White Flint came together to figure out how to make Rockville Pike, White Flint’s main artery, a destination and not just a thoroughfare. Waters told the story this week at Rail~Volution to an audience eager to learn how public-private partnerships and value capture strategies could work in their neck of the woods.

Not only are the White Flint developers looking to include more mixed-use development in the community, they want to build new local streets to fill in a viable street grid and redesign the eight-lane Rockville Pike into a “21st century boulevard” with wide sidewalks, bike lanes, six rows of trees, and dedicated transit lanes. They want to fill those lanes with bus rapid transit to take short-haul commuters off of the at-capacity red line.

The infrastructure total is estimated to cost $601 million – and the federal government isn’t picking up a dime of it.

White Flint is at the forefront of a new kind of infrastructure financing – one which involves the private sector more than the government. As federal funds dry up, all eyes have turned to public-private partnerships, but the topic is still often the subject of much head-scratching and hand-wringing in Congress. Indeed, some have rung the alarm bell about over-reliance on the private sector when it comes to building high-speed rail, saying the public often bears too much of the risk while the private developers carry off all the profit.

Through an extended series of community consultations, White Flint’s developers appear to have gained the public’s trust, and now they’re charging forward with ambitious plans to remake an auto-centric suburban sprawl zone. And by bypassing federal aid, they’re also bypassing the reams of paperwork and bureaucratic processes that come with it, which often add years and millions of dollars to total project cost.

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What happened to the United States over the past several years is most commonly described as a recession. By the technical definition of the word we’re two years into a recovery. But it sure doesn’t seem that way.

Meanwhile, a growing chorus of intellectual leaders says the country is experiencing something different than a normal cyclical fluctuation: the end of an epoch.

Leading urban thinkers, from Richard Florida to James Howard Kunstler, believe we have reached the limits of our fossil-fueled, double-mortgaged, McMansion-based economy. Relief won’t come, they say, until America begins confronting the systemic problems that produced the meltdown, including inefficient and unsustainable public infrastructure investments and housing development.

“What were seeing right now is an inability to look at how we live and how it relates to our problems, and financial problems,” said Kunstler Tuesday during a speaking engagement with the Congress for the New Urbanism. “Production homebuilders, mortgage lenders, real estate agents, they are all sitting back now waiting for the, quote, bottom of the housing market to come with the expectation that things will go back to the way they were in 2005.”

But despite massive government expenditures to restart the old economic engine driven by suburban homebuilding, recovery is elusive, Kunstler said. The author of “The Geography of Nowhere” and “The Long Emergency” argues that suburbanization has been a multi-decade American experiment, and a failed one.

Kunstler is joined in that perspective by Charles Marohn, the director of non-profit group Strong Towns. A new report from Strong Towns places blame for the lagging economy directly on policies that favor low-density housing, fossil-fuel dependence and publicly-subsidized overbuilt infrastructure.

In its new booklet Curbside Chat, Strong Towns asserts that since the 1970s, the suburban growth that powered America’s economy operated much like a Ponzi scheme. In towns across the country, politicians traded the short-term payoffs of sprawling development — namely increased taxes — for long-term maintenance obligations that are just now coming due. And they’re coming up short.

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They lord over empty parking lots in Hazard, Kentucky; Twinsburg, Ohio; and Lewiston, Washington like the ruins of a lost civilization. Vacant Walmart stores are slowly decomposing in more and more American towns these days. More than 100 of them have been memorialized as part of the group Flickr pool known smugly as “They Sold for Less.”

These empty husks — yet to be filled by any other retail tenant — are part of the detritus left behind by a paradigm shift in the real estate industry. Signs of the changing times, they tell us what kind of society we were before the bubble burst.

Now, as the commercial real estate industry regroups, evidence is mounting that Walmart and other mega-retailers will take a much different form than they have in the past. The new American shopping experience, according to many industry observers, will be less “suburban big-box” and more “urban destination.”

The demise of several mega-retail chains during the recession, including Circuit City and Linens ‘n Things, helped produce a vast oversupply of retail space, particularly that of the giant, boxy, just-off-the-interstate variety. Last summer, the research arm of giant commercial real estate firm Colliers International reported that there was nearly 300 million square feet of vacant big box retail space on the market — 34 percent of total retail vacancy left behind by a recession that walloped commercial real estate almost as hard as housing.

Since 2008 alone, 120 million square feet of big box retail space has become available. To put such numbers in perspective, that is the equivalent of the total shopping center space in Cincinnati, Kansas City and Baltimore combined, Colliers reported.

This period of retrenchment has humbled even the once-mightiest of retail forces. CNN reported last month that Walmart stores suffered their ninth-straight quarterly drop in sales. Another sign of the times: Walmart is no longer enough of a bargain for U.S. consumers, it appears. The mega-retailer has been losing market share to dollar stores.

The situation has apparently reached the point where the retail monolith is rethinking its whole carbon-gulping model. Walmart is joining other retailers in thinking smaller and more urban, says Ed McMahon, a fellow at the Urban Land Institute.

“What the recession has made completely clear is that we have way too much retail,” McMahon said. “We are going from the era of the big box to the era of the small box.”

Enter the “Walmart Express.”

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Two key Democratic senators today released state-by-state numbers showing how many jobs would be lost if the current surface transportation authorization bill is not extended by September 30. Sen. Barbara Boxer (D-CA), chair of the Environment and Public Works Committee, and Sen. Tim Johnson (D-SD), chair of the Banking, Housing, and Urban Affairs Committee, sent a letter to their Senate colleagues urging them to act and highlighting the job loss numbers for their state.

Across the country, they say, 1.8 million jobs will be threatened nationwide if the SAFETEA-LU transportation law is allowed to lapse. They say they are working on “a bipartisan proposal to reauthorize surface transportation programs for two years at current funding levels” but they need an extension in the meantime “to allow time to complete work on this legislation.”

Boxer’s home state of California stands to lose the most in case of a lapse: More than $4.6 billion and nearly 165,000 jobs are at stake. But that doesn’t mean that rural, low-population states like Johnson’s South Dakota are unaffected. According to Robert Puentes at the Brookings Institution, South Dakota is one of six states that rely on the federal government for more than half of their road money. And five other states spend more federal money than state or local money on roads. That could give Republican senators from states like Wyoming, Alaska, and Alabama pause before letting the federal transportation program founder.

You can see the state job numbers here.

Maybe we can finally lay the whole “drive till you qualify” myth to rest now.

You probably already suspected that driving farther and farther outside the city limits until you found a house you could afford was not the smartest way to go about buying a home. You may have been tipped off by the fact that the word “drive” was in that not-so-sage piece of advice.

Well, your suspicions are confirmed. The Center for Neighborhood Technology has long been a champion of what they call the H+T (Housing + Transportation) index. They say that instead of measuring affordability strictly by housing costs (typically determined to be “affordable” if housing eats up less than 30 percent of household income), we should look at a combined index and determine affordability as a home where housing costs plus transportation costs make up less than 45 percent of income.

To make this real for the people of the national capital region, CNT teamed up with Washington, D.C.’s forward-looking Office of Planning to analyze how the H+T index changes notions of affordability in the D.C. area. Their report, “H+T in D.C.: Housing + Transportation Affordability in Washington, D.C.” [PDF]

In her foreward, Planning Director Harriet Tregoning (who, incidentally, got hit by a car on her bike last week) says that she wanted to go deeper than the CNT’s previous research, which used 2000 census data. She wanted to know what had happened during the “turbulent period” between 2006 and 2008.

“During that time some outer jurisdictions experienced drops in the median home sales price of 41 percent, while the District’s median sales price dropped by only 2 percent,” she wrote. “This happened while real gas prices grew by 18 percent.”

In any given location, transportation costs vary inversely to housing costs – meaning that in walkable, compact neighborhoods where transit access is convenient and housing prices are high, transportation costs are low – in some cases, low enough to offset the higher cost of housing.

It becomes apparent that “affordable” housing in the farthest-reaching areas of the region is much less so when transportation costs are added. Average H+T burdens in Spotsylvania, Charles, and Calvert counties are largely over 45 percent of AMI [area median income], and even exceed 55 percent of AMI in areas. Conversely, the District of Columbia, Prince George’s County, Arlington County, and Alexandria present some of the most affordable areas in the region. Here, even where housing costs are relatively high, average H+T burdens are largely less than 45 percent of AMI.

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The House and Senate are getting close to voting on a deal, reached over the weekend, to raise the debt ceiling and cut spending.

There’s nothing in the legislative text that says anything specifically about transportation or the Highway Trust Fund, but it’s clear that the cuts mandated in the agreement will affect all sectors. This comes after several rounds of budget cutting this spring. Although some key programs, like high-speed rail, were high-profile victims at that time, solid investments like TIGER and other livability initiatives survived. Some of the cuts were really phantom savings, cutting contract authority that was never going to be used anyway. There are no more easy cuts left to be made in transportation.

The weekend’s debt deal trades a $900 billion raise in the debt ceiling (accomplished in two stages) for $917 billion over the next decade in discretionary spending cuts – reducing domestic discretionary spending to the lowest levels since Eisenhower was president – and including $350 billion in defense cuts – the first defense cuts since the 1990s. Later this year, the debt ceiling will be raised by another $1.2 trillion to $1.5 trillion, depending on the deficit reduction recommended by a special new bi-partisan, bi-cameral committee and agreed to by Congress. Alternately, if Congress passes a balanced-budget amendment (the preference of many Republicans), that would satisfy the conditions for raising the debt ceiling.

In the absence of such an amendment, if committee members can’t come to an agreement, or Congress fails to pass their recommendations, across-the-board cuts will automatically be implemented, cutting equally from defense and non-defense spending. Medicare, social security, and some other social safety net programs would be exempted.

After seeing discretionary spending cut time after time with no sacrifices demanded of the defense sector, it’s remarkable that social programs, not defense, were the ones shielded from the painful cuts. Meanwhile, by spreading cuts around to a greater number of agencies, including massive spenders like the Pentagon, each affected agency is affected less.

Still, infrastructure spending is vulnerable. The White House fact sheet on the debt deal, in the section about the automatic cuts triggered by a failure to act on the committee’s recommendations, says:
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We’re pleased to welcome Stephen Smith as a new contributor to Streetsblog Capitol Hill. We’ll be running Stephen’s work on a regular basis, and you can catch more of his writing at his home blog, Market Urbanism.

Amtrak’s annual ridership may inch over 30 million for the first time this year, but the assault on its funding by House Republicans hasn’t abated. Rep. John Mica (R-FL), chair of the House Transportation Committee, recently proposed slashing Amtrak’s federal subsidies by 25 percent over the next two years. While it’s tough to say how much deficit hawks will actually succeed in cutting, it’s looking increasingly unlikely that Amtrak – and indeed public transportation in general – will get the cash that advocates would like. Given the political climate, Amtrak faces, realistically, two choices: do more with less, or cut service and raise fares.

Unfortunately, Transportation Secretary Ray LaHood’s recent announcement of a $562.9 million loan to Amtrak to buy new locomotives for the Northeast Corridor suggests that they will not be doing more with less. The money will go to buy 70 electric locomotives, which, as Alon Levy at Pedestrian Observations explains, are far more expensive than comparable European and Japanese models, and will lock us into outdated technology for decades to come.

Europe and Asia have realized the benefits of lighter and more nimble trains – cost, speed, and energy consumption among them – but Amtrak’s planned purchase is further proof that the U.S. is not quite there yet. One easy cost-saving move would be to wait two years for Positive Train Control, an anti-crash safety technology, to be fully installed along the Northeast Corridor. By 2015, Amtrak will no longer have to comply with the Federal Railroad Administration’s requirement that trains be able to withstand crashes with enormous freight trains. Free to buy lighter off-the-shelf foreign designs, Amtrak could then save 35-50 percent off the cost of the locomotives, as Alon notes.

An even more radical modernizing and cost-cutting measure (at least in the long run) would be to transition the Northeast Corridor Regional fleet from locomotive-hauled trains to electrical multiple units, or EMUs, in line with best practices in Europe and Asia. EMUs are, like subways in the US, individually-powered carriages, and standard models can be as cheap as the inflated price that Amtrak pays for its unpowered passenger railcars. The locomotive purchase locks Amtrak into buying more of these unpowered carriages in the future, making Amtrak’s decision to go with locomotives all the more important.

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You’d think the Obama campaign had confused Michigan and Ohio with Iowa and New Hampshire. As his 2012 Republican challengers flooded early primary states last month, the President instead headed to where he could stand beside beaming auto executives and watch proud workers toiling on once-idle assembly lines. The Obama administration and the industry have been making a hard media push this summer, celebrating the auto bailout as a big win — for the politicians who supported it, for the economy that they claim needed it, and for the taxpayer who still begrudges it.

To this day, Americans remain unconvinced of the bailout’s wisdom, and fewer than half of likely voters are optimistic that we will be repaid the total $80 billion we coughed up. And if Americans were more familiar with one underreported aspect of the bailout — the rescues of the automotive financial firms — they’d feel even less enthusiastic about joining the party in Detroit and Washington.

Between 2008 and 2009, we taxpayers forked over $17 billion to GMAC (now Ally Financial) and $1.5 billion to Chrysler Financial under the vague theory that they formed an essential part of the auto industry. In doing so, we preserved two entities that, like the banks and mortgage companies, were making subprime loans to consumers: high-interest loans made to high-risk borrowers. Chrysler Financial has paid us back, but despite making more auto loans than any other company last year, Ally just delayed its planned IPO because it is not doing well enough to enable the government to reduce its majority stake.

To repay taxpayers and be profitable going forward, these institutions have concluded that they must expand their portfolio of subprime loans, and they are doing so with gusto. Last month, the credit scores of those buying new cars hit a five-year low. Overall, lending to buyers with credit scores under 680 has been rising quarter after quarter so that four out of 10 auto loans today are subprime. That’s right: 42 percent of Americans — including many economically vulnerable people — are taking on auto debt at high rates of interest, making purchases set to become albatrosses dragging down their tissue-thin household budgets.

Although these lenders assert that subprime auto loans do not pose a risk to the financial system similar to that presented by subprime home loans, this is distinctly disingenuous. Yes, the auto loan market is smaller than the mortgage market, and yes, lenders can quickly repossess cars against which loans are made. But this by no means ensures that these companies won’t fail or find themselves in need of another bailout. Subprime auto lenders might not be the principal driver of a financial crisis, but they absolutely contributed to and suffered from the last one. Like the mortgage lenders, they bundled, securitized, and sold off car loans into a market that collapsed, and GMAC actually diversified into home loans at the bubble’s peak. Obviously, these firms can feed into — and falter from — the next crisis as well.

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