Estimating a Statewide Funding Shortfall Using MPO Long

Range Plans

Alex Bond, AICPUniversity of South Florida

March 16, 2010

What is an MPO?

• A regional transportation planning agency

• Plans and prioritizestransportation improvements

• Funded by a 1.25% takedownfrom highway programs

• Required in all areas with more than 50,000 people

• Must exist to receive Federal money

Documents Adopted by MPOs

Long Range Transportation Plan (LRTP)– At least 20 years in length

– Revenue estimation

– Cost feasible projects list

Transportation Improvement Program (TIP) Four to five years in length

List of projects to be built

Draws from LRTP pool

Unified Planning Work Program (UPWP) Budget and workflow document

The Theory

•MPO plans cover all urbanized areas of the state, plus a little extra

•Therefore, urban needs are listed in most MPO plans AND all funds destined for urban areas are estimated

•Simple calculations yield the shortfall in transportation revenue at that MPO

•Repeat the shortfall calculation for each MPO in the state

About the Review

• Includes plans adopted between 2003 and 2006

•Project began October 2007

•Report released November 2008

General Methodology•Collected hard copies of

all 25 LRTPs

•Reviewed each plan and supporting documentation

•Extracted financial data for shortfall estimate

•Followed-up with each MPO

•Compared with results from similar projects in 1997 and 2002

“Needs Plan”

•Pool of projects that would meet the region’s needs regardless of cost

•Not required by Federal law, but most LRTPs contain a needs plan in some form

•Based on state policies, local priorities, and future demand

Shortfall Methodology

Adjusting to Common Year

•Plans varied in base year from 2000 to 2006

•All shortfalls adjusted into 2005 dollars, since it was the most common base year

•Consumer Price Index- all Urban Consumers (CPI-U) was used for adjustments

Standardizing and Annualizing

•Plans varied in horizon years from 2025 to 2030

•Some plans begin after the TIP ends

•The shortfall was divided by the number of effective years of the plan

•The annualized shortfall was multiplied by 20

TWENTY-YEAR STATEWIDE FUNDING SHORTFALL

CURRENT YEAR FDOT WORK PROGRAM

Shortfall Details

•$62.5 billion over twenty years

•$3.1 billion per year

•Shortfall is accelerating…fast

Review Year

Shortfall in 2005 Dollars

Percent Growth

Cumulative Growth

1997 $29.8 Billion -- --2002 $42.7 Billion 43% --2008 $62.5 Billion 46% 110%

Note: The 1997 and 2002 reviews have been adjusted into 2005 dollars to enable comparison. The first review revealed a shortfall of $22.3 billion in 1995 dollars. The second review revealed a $37.7 billion shortfall in 2000 dollars.

Limitations and Conditions

•Surface transportation only

•Capital and operating only

•Few attempts to incorporate toll/HOV

•Transit shortfall is probably underestimated due to prevailing programming methods

•Use of “boxed funds” results in zero shortfall

•Disagreement on what is a “need”

Shortfalls Varied ConsiderablyMPO

20-year Shortfall (millions)

Percent Shortfall

Okaloosa-Walton $6,399.2 85.3%

Gainesville $359.1 84.4%

Lee $4,668.6 63.5%

Brevard $935.4 57.4%

Pasco $1,644.4 51.4%

First Coast $3,166.8 47.2%

Collier $2,103.2 41.4%

Capital Region $1,066.5 38.8%

Sarasota/Manatee $983.9 26.6%

Broward $2,245.0 24.2%

Miami-Dade $3,260.6 14.3%

METROPLAN Orlando $1,244.5 12.7%

Pinellas $741.1 9.4%

Indian River -$19.8 -2.3%

Total $62,472.5 42.9%

Larger shortfalls in new, high-growth areas

Smaller shortfalls in older, lower-growth areas

One area had no shortfall at all!

Risk Factors for a Shortfall

•High growth rate

•Outsized needs plan

•State-mandated corridors and modal facilities

•Lack of local sources of funding: sales taxes, impact fees, local option gas taxes

Alex Bond, AICPALBond@cutr.usf.edu (813) 974-9779

Report available from www.mpoac.org/documents