Amtrak's return to Mobile will be expensive and risky

If left alone to sink or swim on its own financial viability, Amtrak would have gone under long ago and we would never be having a discussion over whether the City of Mobile should commit scarce resources to an Amtrak station here.

Amtrak is not a profitable enterprise. It never really has been, either. At the end of Fiscal Year 2019, the national passenger rail service reported its lowest ever adjusted operating loss of $29.8 million. That followed operating losses of $194.1 million in FY 2017 and $170.6 million in 2018. Under Generally Accepted Accounting Principles (the standard that publicly traded companies use in reporting to the Securities and Exchange Commission), net losses for 2018 and 2019 would have been $817 million and $875 million. Amtrak has just one route that would be profitable under real-world accounting rules--the Northeast Corridor. This route serves the country's most densely populated region and most closely resembles places like Japan and Germany with dense, high-income population centers.

The national rail service receives about $234 million in subsidies from state and local governments it serves. Without those subsidies, losses would have been well over $1.0 billion. In addition, Amtrak receives $1.3 billion annually in federal allocations, without which Amtrak would have been broken up and sold for scrap years ago. President Trump initially proposed a complete elimination of federal subsidies, then acquiesced and requested $611 million for FY2020, only to have Congress restore the $1.3 billion from prior budgets. Trump is likely to propose cuts in FY2021 and beyond.

Which brings us to the decision faced by the Mobile City Council on New Year's Eve. From John Sharp's excellent reporting at al.com:

City Council members were asked Tuesday to subsidize a local match to a federal grant that passenger rail advocates believe will not cost more than $3 million over three years. ...

“This investment is totally an offset for operational costs,” said Wiley Blankenship, president & CEO of the Coastal Alabama Partnership and chairman of the 21-member Southern Rail Commission that is charged with prompting passenger rail service and pursuing funding opportunities to support its mission. ...

As proposed, the three-year commitment under what rail commissioners call a “worst-case” scenario -- where annual ridership is around 38,000 people who spend an average of $18.33 per trip – would cost city taxpayers $3 million from 2023-2025. Over five years, the subsidy would rise to $7.7 million.

Rail commissioners, however, are proposing what they believe is a more realistic “conservative” estimate of around 86,400 riders per year who spend an average of $30 per trip. Under that proposal, it would cost Mobile around $2 million to subsidize the train’s operations, and about $5.4 million over five years.

Under the "worst case scenario" from Sharp's report, the route would generate gross receipts of about $3.96 million annually, the city's annual subsidy tab would be $1.0 million and Amtrak collects about $5 million total. Under the "conservative" estimate, annual gross receipts would be about $20.45 million, the city ponies up $1.67 million and Amtrak collects $22.1 million.

Amtrak collects all of this revenue. Ticket fare, food, beverage and sundry services all go to Amtrak and none go to the city or the state.

The city will also be on the hook to secure funding for capital improvements that could cost as much as $7.7 million. This will be needed for railway modifications west of the city and a new train station at Brookley, which is destined to become Mobile's consolidated commercial and industrial air traffic center.

Under neither of the two scenarios does the city's obligation fall below $1 million annually for the three-year planning scenario (years 2026 and 2027 do, presumably due to discounting). Keep in mind that both of the scenarios are "what if" imaginations of proponents. It's entirely possible that either scenario plays out or reality plays out somewhere in between. If we're honest about the City of Mobile's history in projecting usage of its grand ideas, even the worst case scenario is a tad on the optimistic side. A hard question with an unpleasant answer: "What is our cost if we get 5,000 riders a year and they only spend $10.00 each?"

Sharp's reporting also touches on the impact to Mobile's bona fide cash cow--The Alabama State Port Authority. The State Docks has said that moving any Amtrak station to Brookley would be preferable to having it located downtown near the Outlaw Convention Center on Water Street. However, it would still represent a significant and costly disruption to rail traffic through the port. We all hate it when rail cars are stacked up along Water Street and cut off access to the waterfront along Mobile River. That gets worse and costlier for both port traffic and tourism if the port's rail operations are disrupted for the twice (at least) daily arrivals and departures of the passenger train.

All of the above is not to say that passenger rail service with stops along the Gulf Coast from Mobile west to New Orleans doesn't have tremendous economic, cultural and historical appeal. This stretch of the Gulf Coast has a magnetic draw on tourists from elsewhere in North America and abroad. The State of Alabama is celebrating its bicentennial this year. The communities along this rail route have already celebrated their tricentennials.  The culture of this region is unlike anything found elsewhere on the continent. A visit that encompasses the 150-ish miles between the cuisine of Louisiana and the pristine beaches of South Alabama with fun and gaming along the Mississippi coast is unique. History, fun, food, charm, hospitality, mild climate... It's a moneymaker. But the infrastructure to support that recreational order of magnitude is... expensive.

The City Council has a big decision to make on New Year's Eve. The cost of putting Mobile at the eastern edge of the proposed rail route is much more than just the $3 to $5 million dangled by the Coastal Alabama Partnership and the Southern Rail Commission. Ridership is probably going to be lower than projected (at first) and fares are probably going to be higher than the $25-ish estimate. Capital costs for railway improvements and station construction will go up because they always do. The disruption of business at the port will cost millions and probably a lot of jobs. Plus, Amtrak's finances are an unmitigated disaster and President Trump could scrap the whole system before 2023 even rolls around. There should be no misunderstanding that going forward will be costly and risky.

Alabama Policy Institute op-ed on the toll bridge misses the point

Earlier this week, an op-ed from Phil Williams, Director of Policy Strategy at the Alabama Policy Institute appeared in Yellowhammer News. In it, Mr. Williams touted the effectiveness of tolls as a conservative-minded approach to solving transportation infrastructure issues in the state of Alabama. Unfortunately, he misses the point.

First, API is a conservative think tank based in Birmingham and says it is "dedicated to influencing public policy in the interest of the preservation of free markets, limited government and strong families." As a founding member of the "Vast Right Wing Conspiracy" and a strong libertarian-ish conservative, I applaud such contributions to policy debates. We need more common sense in our town halls, state capitals and Washington, DC.

Conservatives should be advocating for fresh, market-driven ideas to solve public policy problems like transportation infrastructure. The solutions can only be market-based, not market-only, because infrastructure projects like bridges and interstate thoroughfares meet all of the economic criteria for the definition of  public goods. Without devolving into a sophomore economics lesson, a "public good" is something of value that is scarce enough for people to be willing to pay for it, but for which traditional free exchange markets do not exist.

There are means of estimating willingness to pay for public goods that come reasonably close to establishing a market-like value for them. When the public good's benefits are weighed favorably with its costs, the transaction occurs and a public need is met in the least inefficient way. It's not perfect, but it works for flood control, environmental stewardship and police & fire protection.

Unfortunately, the proponents of the Mobile River Bridge & Bayway Project failed to competently employ any of the proxy valuation methods, despite spending more than two decades and an estimated $60 million of the taxpayer's money in developing their plan. Indeed, a two-week review of the decision documents offered by the Federal Highway Administration and the Alabama Department of Transportation revealed that proponents and their contractors incompetently or perhaps even fraudulently presented the project as the most economical, least-cost solution to a perceived future congestion problem on the I-10 corridor.

You can read a report of that review by clicking here. You can read a "Fact Sheet" summary of the likeliest economic effects of the proposed project by clicking here.

Mr. Williams writes this in his op-ed:

For the purposes of THIS discussion you can set aside for a minute whether a bridge is necessary. You can also set aside whether or not the original plans for a $2.1 billion bridge were reasonable. No opinion is offered here on those two salient points. What is at issue in the broader scheme is: how can one who claims the mantle of “conservativism” pay for regional infrastructure? There are very few options. To be sure, bridges cost money. There is no free lunch and there is no free concrete. If the existing revenue does not match the existing need then the only options are to raise revenue through taxes on all, or tolls on some. Throughout this whole melee it was interesting to hear public officials and well-meaning citizens rebuke the idea of a toll as somehow being a violation of conservative principles.

Here’s a news flash: research by the Alabama Policy Institute clearly indicates that one of the most conservative approaches to funding regional infrastructure is what is often referred to as “a user pays system,” or more commonly “a toll.”

It's not possible to set aside project need or project scope because exaggeration in those factors were responsible for the price tag we ultimately rejected. But it wasn't just the price tag.

Here's another news flash: South Alabama motorists and their interstate brothers and sisters can smell a boondoggle coming before it even crosses the state line. The economic consequences of that bridge project were intuitively obvious. No research was needed. It wasn't that a toll violated some innate sense of right and wrong. It was the fact that an exorbitant toll was to be put in place for a minimum of 50 years along with no-compete provisions that would have eventually forced near-term future motorists to use a very costly bridge & bayway system that was loaded with unnecessary extravagance. That project wasn't needed to meet the expected transportation needs or address the expected annual risk of storm surge damage. That project was an over-engineered and over-priced debacle that would have resulted in economic disaster for the region and the state. But it would have guaranteed a tidy return on investment for the monopoly private sector concessionaire. That cannot possibly comport with any notion of conservative principles.

Mr. Williams is engaged in a battle to the death with a strawman. No one is arguing that a toll bridge isn't an effective way of financing a needed project. Projects with an easily identified need have economic benefits that are just as easily identified. A toll is simply a means of monetizing that benefit for the purpose of financing it. We are arguing that this project was demonstrably incapable of producing a monetized benefit that was worth its cost. And in this case, we simply did what rational, free market-minded people should do when confronted with such a choice. We walked away from the transaction.

In other words Mr. Williams, the market worked.

What Mr. Williams may not realize is that the Block the Mobile Bayway Toll Facebook Group counts among its membership a formidable array of talent and experience that is more than capable of addressing the shortcomings of the ALDOT/FHWY plan. There are scientists, engineers, (raises hand) economists, transportation experts, attorneys and policy wonks that might be willing to assist the open-minded in Montgomery in developing a plan that the market-minded folks around here can buy. Perhaps API would be willing to engage with and make use of that talent and advance the cause of influencing public policy "in the interest of the preservation of free markets, limited government and strong families."

Was Toll Road interoperability partly behind Alabama's push to get the Toll Bridge built?

The communities in Mobile and Baldwin Counties may have a little something extra to be thankful for this Thanksgiving.

This story was posted on MyNBC15.com, but it's from WPMI's parent company, Sinclair Broadcast Group. It brings to light a previously unknown (to us) obscure provision in the Moving Ahead for Progress in the 21st Century Act, aka, MAP-21. This is the federal law that also contained the obscure provision requiring FHWA and its non-federal partners to get local approval for all federally funded highway projects through their Metropolitan Planning Organizations. Those MPOs were the two boards that soundly rejected the Mobile River Bridge & Bayway Project in August, after the grassroots Block the Mobile Bayway Toll Group on Facebook mobilized its forces and made clear that the local electorate was having none of it.

The project was fatally flawed and faced years of litigation even if it survived the Facebook Group's MPO broadside, but the group prevailed and Alabama Governor Kay Ivey pulled the plug and declared it dead.

With this story, we learn that MAP-21 also required tolled roads to be interoperable, so that drivers who purchased electronic pass systems could use toll roads in other states without having to register their vehicle or electronic gadget in each state. It's for our convenience, of course:

Congress hoped to have all tolls systems interoperable by 2016 and the good news is we’re close.

“Ninety-five percent of toll transactions are already interoperable,” said Pat Jones, CEO of the International Bridge, Tunnel and Turnpike Association, or IBTTA.

He said the problem with not meeting that 2016 deadline set by Congress is that there was no direction attached to that deadline.

“They said this should happen, they didn’t say who should do it, they didn’t say how it’s going to be paid for,” said Jones. “They simply said this needs to happen.”

Thank goodness for small favors. It's one thing for Congress to require states to meet certain requirements as a condition for accepting federal money. They call that... dare I say it? A quid pro quo.

It's quite another thing if along the way, Congress or the agencies it funds make it easier for certain concessionaire enterprises to share the revenues from the tolled roads they manage with all of the states they operate in. Thinking big-picture and connecting dots (with no evidence), is it hard to imagine deals where part of the tolls paid by Alabama drivers traveling in Texas, Florida and Georgia get shared with the home state? You know... so Alabama can pass along a bit of their take with concessionaire partners in Texas, Florida and Georgia when their drivers use Alabama toll roads (and bridges). They kinda already do this sort of thing with Powerball Lottery drawings, don't they?

Thank God we don't ever have to worry about what coulda happened, because it ain't gonna.

Three Fools kill city of Mobile annexation plan

It is often said that a fool would rather rule in hell than serve in Heaven. Ladies and gentlemen, let me introduce you to three fools: City Council President Levon Manzie and City Council members Fred Richardson and C. J. Small.

At issue was a request by three areas located just outside Mobile City Limits to join the city. In order for the petition to move forward, the City Council had to vote to allow a special election to be held, and the voters in the areas under consideration could decide.

State law requires any significant action pass the Council by a 5-2 vote. The motion failed by a 4-3 vote, leaving about 13,000 people without city trash service and emergency medical services.

Three fools decided that 13,000 didn't even have a right to vote on the matter.

Until now, no City Council Member has ever denied the ability of annexation petitioners the right to vote on whether to join the City of Mobile. Let that be clear--all other annexation petitions were put before the people for a vote with unanimous consent of the City Council.

The addition would have pushed Mobile over a threshold of 200,000 residents. That threshold is important because there are bunches and bunches of federal grant opportunities that are open only to those cities with populations of 200,000 or more. It would also have made Mobile the second largest city in the state of Alabama. That's mostly a ceremonial position--the Mobile-Baldwin Counties area is already the second largest economic and mass media market and third place is not very close.

This was an extraordinary opportunity to acquire economically productive areas of the county that would have easily made a greater economic contribution than the costs of providing the services. The math is a little more complicated than the childish rant Councilman Richardson tried to use in justifying his vote against allowing the vote. For starters, you don't compare annual revenues to one-time costs. As a professional economist, I would have been happy to I'd be happy to demonstrate the actual net benefits of annexation but I think the discussion would have been pointless. As another old saying goes, it's best not to argue with a fool because he'll just bring you down to his level and beat you with experience.

Mobile will suffer because those grant opportunities could have made tremendous impacts on overall public safety, law enforcement, disaster response, transportation and urban development. Grants aimed at improving the lives of the poorest among us will be foregone because some of them are for "big cities." Those Mobilians who are comfortable and well fed don't benefit directly from those grants. The neediest among us would have benefited and now they won't. How foolish.

Mobile is shrinking population for a reason. That shrinkage can only be addressed by making living in the city more attractive than living elsewhere. A city with three fools standing in the way of progress isn't very attractive.

The election and finalization of annexation has to happen before December 31, 2019 in order for the city to be counted at 200,000 or more for the 2020 Census. That opportunity appears to be lost.

So instead of having access to tens of millions in new grant opportunities for Christmas this year, we're stuck with our stupid Moon Pie Drop. And instead of Three Wise Men, we still have our Three Fools.

What's worse is that the mayor and the four council members who were for the plan are not happy with the Three Fools' decision to block growth. Nice urban development project you have there, Councilman. Be a shame to see something happen to the funding. To think there won't be a measure of political retaliation is... foolish.

Governor Kay Ivey still doesn't understand how the "NO TOLLS" thingie works

In remarks made Wednesday at an event celebrating the distribution of oil and gas royalty money, Governor Kay Ivey tried to blame "the local folks" for her decision to kill off the Mobile River Bridge & Bayway Project.

"Until they allow that project to even be considered in their project list, we can't even ask for federal funds or spend what we thought we had. So until the local folks come together and find a way to be included, this project is dead," said Ivey.

She still doesn't understand how this all went down. That project will not ever be considered, and the "local folks" can show you a little somethin' about being included.

To recap: The state proposed to build a state-of-the art architectural wonder to add a new route across the Mobile River and Delta. It was to relieve congestion, which is bad here, but not strangling like bottlenecks in Houston, Baton Rouge and Birmingham. It was to consist of a high rise bridge over the river and a complete replacement of the existing Bayway.

The price tag was a whopping $2.1 billion--twice the previous estimate. Worse, the state also proposed to fund this monster through a $6 one-way toll. The project was hopelessly infeasible and everyone knew it.

Local residents did indeed object to "that project," and made it clear that it was unacceptable. When their early, disorganized objections were met with an attitude of cool obstinance from the Governor and ALDOT, the public joined forces via social media. State Auditor Jim Ziegler and a handful of his fellow toll fighters formed the Block the Mobile Bayway Toll Group on Facebook and invited the public to join. Within three months, the group membership had reached 50,000 members and the group's message of "NO TOLLS!" could no longer be ignored. Bumper stickers. T-shirts. Peaceful demonstrations. Coordinated messages on local talk radio and across Facebook, Twitter and Instagram. Grassroots politics in its purest form.

It's worth noting that citizens were never unanimous in opposition to a new bridge or new bridge plus Bayway modernization plan. Most understood that a new route across the river and delta would be needed sometime in the un-distant future. It was the toll plan that caused the uproar (see 'Tolling for the Mobile River Bridge is a symptom, not the problem'). The local economy was at risk of suffering permanent hardship and any Gulf Coastian with a family budget could smell it.

There were other plans that should have been considered; plans that weren't calling for a Taj Mahal structure that could have been feasible. The state never told the whole truth on why such a mega-project was the only and best solution, and this lack of willingness to consider public opinion stuck in the people's craw.

Tone deaf ALDOT tried unsuccessfully to reestablish control of the narrative with pointless press releases, strawman "fact checks" and bold statements of "No tolls? No bridge!" A contentious meeting between local elected officials and ALDOT representatives and consultants ended poorly when ALDOT Director John Cooper stormed away from the dais with the now famous smart-assed comment: "You've caught it; hope you can skin it."

They weren't budging. Governor Ivey and ALDOT were going forward with the project as proposed--tolls and all. Confident that they wouldn't be stopped, they finalized the environmental clearances and began the preliminary processes to move towards construction.

That's when the Facebook group found and adroitly used the obscure provision in an obscure federal law that required local approval of the project in both their short and long range transportation plans. That approval was first tabled by the Mobile County side of the bay and then blocked completely on the Baldwin County side a week later. No local approval meant no federal funding, which meant the project could not move forward at all.

The night of the Baldwin County vote, Governor Ivey released a statement declaring the project "dead." 

The "local folks" simply blew a whistle to stop the toll bridge. That project will stay stopped. That one is dead. What about the other alternatives, like the 50-year retrofit?

To this day, members of the Block the Mobile Bayway Toll group and the local elected officials are open to alternatives for a new route between Mobile and Baldwin County. But based on Governor Ivey's comments Wednesday, the state remains unwilling to discuss toll-free alternatives. Like the 50-year retrofit. Oh, well.

That's how this works--come up with a plan that solves the congestion problem with no tolls. The Metropolitan Planning Organizations will review it, and we'll talk. We'll talk a lot, and you'll listen. A lot. Or...

ADVERTISEMENT:

The Four Score

Lagniappe story shows that the Block the Mobile Bayway Facebook group stopped a disaster

It's fitting that this nightmare story showed up in time for Halloween. It describes the hellish situation unsuspecting drivers found themselves in after choosing the "convenience" of toll-by-plate over the stop-and-pay lanes on the Foley Beach Express. It's scary stuff, y'all.

Stop now, and say a little prayer of thanks for the Block the Mobile Bayway Facebook Group. Without that group's efforts, the over-designed, ill-conceived and economically disastrous Mobile River Bridge & Bayway would be on its way to construction as you read this post.  Then, this madness would have become real in the near future for as many as 75,000 of you and your fellow citizens:

About 10 times he actually used the service, rolling through without stopping to pay. He said he mainly used it when he was taking his mother to the doctor, and rather than wait in line, he’d use the toll-by-plate lane. He waited and waited for a bill. When several bills finally arrived, they said he owed $365.

“I hadn’t seen a bill in so long I finally said to hell with it,” Coe said. “It was June when I used the toll. I called them in July and they said they still had nothing. I thought, ‘they’ll send me a bill sometime.’ The first notification I got was September and it told me I owed a bill, then another bill, then another bill and then another bill.”

He’s a little leery about ever using the service again.

The story is behind Lagniappe paywall, but it's free in the analog print version.

Let's put this is perspective. The Foley Beach Express carries a small fraction of the traffic that the I-10 corridor carries across the Mobile River and Bay. The driver featured in the Lagniappe story waited three months for the gears of the Alabama state bureaucracy to churn-n-burn out a bill that came out to almost $40 per trip.

The MRB&B project was planning to move forward without a stop-and-pay option. In a "feature" touted by ALDOT as a benefit of its advanced concept and design, drivers would either pay via toll-by-plate or opt for installing a state-issued electronic transponder in your vehicle. "High tech extortion" is not too harsh a term for it.

Imagine the upheaval of having tens of thousands of stories just like the one in the Lagniappe piece. Imagine the Alabama Motor Vehicle Division being deluged by the toll bridge concessionaire with thousands of tag numbers every day of every week of every month. Then the concessionaire maybe, maybe not getting bills mailed out to the registered owners on time.

The Foley driver had to wait three months to get his bill. Would anyone like to take a stab at the over/under on the number of days between toll trip and toll bill for the average commuter on the MRB&B? If that's not scary enough for you imagine what the bill would be with a month's worth of commuting compounded by escalating and punitive "administrative fees" piled on top?

What if you can't pay it? What if the state suspends your license and registration? What if you lose your job because your car was impounded? Or what if your employer closes shop and moves away because of the economic burden of an infeasible boondoggle?

Would ALDOT start putting people in jail for not paying their tolls? What a monster...

Thankfully, the MRB&B project is dead, Dead, DEAD. No chance of Freddy (Cooper?) Kreuger coming back from the grave and restarting that reign of terror.

If anyone asks, "what happened to the toll bridge?" You tell them, "the Facebook Group got it killed."

The Facebook Group worked together in textbook grassroots fashion and stopped the hellish scenario from becoming a reality. The group was started by Alabama State Auditor Jim Ziegler and a handful of stalwart citizens using their personal accounts on Facebook.  It grew. It worked together. The group beat the odds and got the project killed using an obscure policy provision that no one else even knew existed.

ALDOT and powerful special interests could do nothing but watch helplessly as two boards of local elected officials obliterated a $2.1 billion boondoggle.

Defeating the project was a remarkable example of ordinary Americans working together to achieve a common goal. That goal was to prevent the Foley Beach Express toll-by-plate ordeal from becoming a nightmare for Mobile and Baldwin Counties.

Mobile Regional Airport Master Plan Meeting set for TODAY

Staff members of the Mobile Airport Authority and airport planning experts will provide an update on the process to develop a Master Plan to relocate commercial passenger service to the Brookley Aeroplex.

The meeting is being held at B.C. Rain High School from 4:00 pm to 7:00 pm.

Via mynbc15.com article.

I watch local news websites fairly consistently and this is the first I've heard about this Master Plan Meeting.

Moving Mobile's commercial airport from Far West Mobile to the Brookley Aerospace facilities is a very big deal and could have significant impacts for the city and the region.

One of the biggest issues identified by members of the Block the Mobile Bayway Toll Facebook group last summer was a perceived lack of effort on the part of government officials to engage the public. A consistent theme is that officials don't do a good job of and telling people what they want to do, what it will mean for them and what it will cost.

Government officials respond to that by explaining that they publicize everything that they're required to.

There is persistent public distrust of elected and appointed officials locally, statewide and nationally. That distrust is only rivaled by distrust of the news media.

There is persistent belief by those distrusted entities that the public doesn't pay attention until either the last second or until it's too late for anyone to do anything about it. People are much more interested in stuff like the fake "vaping crisis," the fake "impeachment inquiry" and who Miley Crus is dating.

The truth is somewhere in the middle of this mass communications mess but two old adages come to mind: "Believe none of what you read and half of what you see," and "the customer is always right."

So, why the Milkman photo? Hmm... Mash here.

Final Nail: Eastern Shore officials vote to formally kill the Mobile River Bridge & Bayway project

Alabama Governor Kay Ivey declared the toll bridge project "dead" right after the August 28, 2019 Eastern Shore Metropolitan Planning Organization (MPO) adopted a resolution pledging to remove it.

The MPO made it official today:

The last bureaucratic hurdle toward killing off the state’s $2.1 billion Interstate 10 Mobile River Bridge and Bayway project was cleared Wednesday with little fanfare.

Elected officials in Baldwin County, however, expressed “cautious optimism” about what might come next in exploring alternative ways of alleviating predicted gridlock on I-10.

With voice approval, the Eastern Shore Metropolitan Planning Commission adopted its fiscal year 2020-23 Transportation Improvement Plan, or TIP. The plan is a crucial document that details transportation priorities for the next four years.

 Although the Governor's declaration made the project a political improbability, the project was actually in a technical stasis. The Federal Highway Administration was the lead agency for the conduct and  submission of the  project's Supplemental Environmental Impact Statement. 

That environmental document and its Record of Decision (ROD) was finalized on August 16. On August 30, FHWA quietly filed a final notice formally ending the National Environmental Protection Act (NEPA) process and starting a mandatory time limit on litigation related to the agency's decision to move forward.

Alabama had declared it dead. Washington still had boxes to check.

Today's formal vote to remove the project from its TIP also formally removed it from being considered for federal funding. It went from technical stasis to both politically and technically dead. It is now dead, Dead, DEAD.

If this all sounds a little confusing, don't be alarmed.

In order for a federal project to move to construction, it has to be approved by the lead federal agency and it has to be eligible for federal funding. A project that gets approved is only halfway there. The Moving Ahead for Progress in the 21st Century Act, or MAP-21, requires local political control over the projects that are planned for their area. If it doesn't get that local support, the project can't be funded so it can't be built, approved or not.

ALDOT and FWHA got approval ahead of funding in their project schedule. Funding authorization required public involvement just like the EIS did. Had they gotten inclusion in the TIP done before completing the environmental documentation, we would certainly be in a different mode right now.

It was the work of the Block the Mobile Bayway Toll group on Facebook that made this happen, folks. The Group proved that We the People are smarter than their alleged betters gave them credit for. The People uncovered obscure provisions in an obscure law. They followed the advice of group members with expertise in said law, contacted the right people, made the right requests (LOUDLY), and coaxed their local elected representatives to smack ALDOT right upside its wobbly head.

Well done, y'all.

ALDOT shreds remaining credibility, now says elevating the Bayway is... the least cost option?

ALDOT has been lying to us all along. There was never a federal requirement to elevate the Bayway to withstand the 100-year tropical storm surge with 100-year sea level rise.

ALDOT Director John Cooper told NBC 15 that federal law required elevation above the 100-year in July. He repeated the statement to Fox 10. The project manager for this boondoggle said it to WKRG.

(Extra Point: Go here to see how many different ways Cooper has tried selling this story.)

Governor Kay Ivey told every media outlet in the state that it was the truth.

ALDOT was asked repeatedly by members of the public, local elected officials and even your beloved blogger what specific federal law or regulation stated "thou shalt not build below the 100-year event." We never got a straight answer.

We now know that the requirement was a whole cloth fabrication.

Brazenly, the agency now says (PDF) that elevating the Bayway to their imaginary 100-year standard is the least cost option!

Making inaccurate statements because of a mistake or incomplete information is one thing. Making false statements knowing they are not true is lying.

How are we to believe that the cost estimates provided in the link above are accurate? They've been lying to us for months and now we can trust them?

How stupid do they think we are?

If you thought the peasants in the Block to Mobile Bayway Toll Facebook Group were revolting before this, you ain't seen nothing yet.

Even if we were to take the cost estimates at face value, the notion that they demonstrate replacement to be the least cost option is wrong because ALDOT still doesn't understand the time value of money concept.

Economics 201, y'all (click or tap the image for larger scale).

The table above comes from ALDOT's PDF, wherein the agency claim that the widened and retrofitted Bayway will have to be replaced 20 years after the upgrade because it will have reached the end of it's useful life.

The top two lines are for upgrading the structure. The bottom two are for replacement. There are calculations shown for building to the 50-year event and the 100-year event.

This new argument has more than one problem.

1. The process of widening & retrofitting the Bayway will absolutely extend the structure's useful life, making the contention that it needs to be replaced in a mere 20 years highly questionable.
2. Even so, a cost anticipated 20 years into the future must be discounted to present day dollars. At 2.5% interest and a 20-year term, the cost to replace the upgraded Bayway is $397 million, not $651 million as shown for the 50-year option. The 100-year option's discounted replacement cost is $543 million, not $890.
3. If the useful life of the Bayway is extended to 40 years by the widening & retrofit work, then the discounted replacement cost is $242 million for the 50-year option. This makes the 50-year retrofit the least cost option at $770 million total.
4. The difference in cost between Bayway widening & retrofitting today and replacing sometime in the future is... interesting. Why does it cost more to widen and retrofit today than it does to replace that same structure tomorrow? If a brand new widened & retrofitted 50-year Bayway costs only $651 million, we'll take one today in Coral Pink with the Key Lime highlights.

The most likely answer to No. 4 is that these numbers are completely bogus, just like everything else ALDOT has been telling us about this project. They're probably made up to fit the narrative they're selling today.

Tomorrow, Baldwin County's Metropolitan Planning Organization has an opportunity to tell ALDOT how they feel about being lied to.

ed note: This post is subject to revision. Please let me know about any problems at BridgeReview@ibleedcrimsonred. com. I will try to be prompt. 

Plus, there are several other items of interest in ALDOT'S new story that need to be addressed, which will be covered in a future post. 

BOOM: Federal official tells Fox10 that there is no federal requirement to elevate the Bayway to 100-year protection

ALDOT has been stubbornly consistent that as part of the proposed Mobile River Bridge & Bayway Project, raising the Bayway is required by Federal Law. Not so, says an unnamed federal official to Fox 10's Tyler Fingert.

My question is: How long did they think this charade would last?

Two things need to be digested here.

One, while we have no good reason to doubt the veracity of Fox 10's reporting, it's an unnamed source. We don't know the agency the official works for, or where he is on the agency's food chain. Typically, unnamed sources dine on the lower end because they're at risk of retaliation from higher ups. That doesn't mean he doesn't know policy. Just that he (she?) probably doesn't make policy.

Two, Fingert says the source tells him that "ALDOT is using other specifications to address risk which is acceptable to the federal government." So, it's not required to meet government standards, but since it does, we're good?

Umm, no. We can't afford Taj Majal projects anymore.

The failure to properly address risk has been one of my chief complaints about the plan to replace the perfectly functioning Bayway. The coastal engineering team did an acceptable job of finishing half of a coastal storm damage risk analysis. All they did was tell us what we already knew: that the Bayway is vulnerable to really bad storms.

About two weeks ago, I wrote the following in this space:

[The] plan calls for the new structure to be elevated and built to "withstand the 100-year design storm including the 100-year sea-level rise." (SDEIS Vol I, p. 32)  In layman's terms, this is a structure built to hold up in a hurricane with a 1% chance of occurring in any year and driving a water level that is only going to occur sometime between now and 100 years into the future. (Assuming of course that one accepts the United Nations' climate change projections.)

...

This was the only alternative that was modeled by ALDOT's coastal engineering team. There were no other alternatives considered. In fact, Appendix G (SDEIS Vol II) didn't model the existing Bayway to determine what combination of storm surge and sea level rise would cause enough damage to it to render the expected risk unacceptable. That is, we don't know the expected annual risk of leaving the existing Bayway as it is. So how can we know whether the expected annual risk of the proposed structure is acceptable?

Why shouldn't we demand it be built to a standard that survives the 200- or 500-year storm with 200- or 500-year sea level rise?  Why is the 50-/50- standard not acceptable?

For that matter, will a modified, storm-armored and expanded 6-lane Bayway reduce expected annual risk enough to be economically feasible? Economically feasible without a toll, perhaps?

Emphasis is mine.

There are less costly alternatives that have not been evaluated. There is a level of storm surge vulnerability that we are willing to accept.

With the public revelation that the old deterministic method of establishing risk isn't actually a federal mandate, we may finally see a new probabilistic process that clearly communicates risk and allows those who pay for it decide how much risk we're willing to accept.

UPDATED: Governor Ivey and bridge proponents suffer major setback as Transportation Tax Project is put on hold

See update below.

Make no mistake about it--Wednesday's unanimous vote to table all items related to construction of ALDOT's Transportation Tax Scheme represents a major setback.

The vote by the Mobile Metropolitan Planning Organization to approve the whole Transportation Improvement plan was quietly expected to sail through a process mandated by a federal law known as MAP-21. Succinctly, MAP-21 requires federal spending to be approved by a local transportation planning group, in this case the South Alabama Regional Planning Commission's MPO.

However, the Facebook Group Block the Mobile Bayway Toll got wind of the gravity of Wednesday's decision and quickly swung into action. MPO members (almost all of whom are locally elected officials) were deluged with comments and fervent requests to either table or remove the specific projects related to the Transportation Tax Scheme.

The MPO carefully and openly considered the merits of the public's concerns and called timeout.

The items tabled today will be held in abeyance until after Alabama Toll Road, Bridge, and Tunnel Authority holds a special meeting on October 7, 2019. ALDOT may not receive or spend any funds on the tabled items until they're approved.

First, this is a setback because this delay likely wrecks ALDOT's schedule. The three private sector contractors cannot submit their final proposals until all clearances have been received. ALDOT had planned to receive those proposals by the end of the calendar year and award a contract in early 2020. That looks unlikely.

Second, this delay also gives creative minds about six weeks to come up with different design and funding concepts for the project. It also gives ALDOT time to conduct at least a cursory coastal storm surge risk analysis on the Bayway modification vs replacement controversy.

This will force project planners to reconsider their alternatives analysis and that in turn has a likelihood of resulting in at least an addendum to the environmental documents approved on August 16. This is another schedule wrecker.

Further, this gives steadfast and well-funded bridge opponents more time to prepare their complaints and file their lawsuits against the project. Those lawsuits will happen if ALDOT and FHWA try to move this project forward as is.

---

---

So yes, Wednesday's decision was a very big deal.

Update: The implications on the project schedule were made explicit yesterday by ALDOT Director John Cooper. Cooper was in an informational meeting with area elected officials held after the MPO meeting:

ALDOT’s Transportation Director John Cooper says Mobile Metropolitan Planning Organization’s (MPO) decision to table the vote for funding and the Eastern Shore MPO's consideration to remove the project from the transportation improvement plan (TIP) stops them from requesting proposals. It's tricky because he says officials would want a final proposal first before putting it back in the TIP.

"We can't deliver on what you have asked us to do in the position you have put us in," Cooper said. "We can't bring you a final plan without it in the TIP."

Just as I said. The schedule is wrecked.

Bridge Economics in Alabama

There are three things certain in life: Death, taxes and the determination of people to avoid both.

Yes, this is going to be a snarky post with a little good ol' smart-assery. Hey... this stuff needs to be said and I have the un-buffered medium with which to say it.

Remember: I am not opposed to tolling as a concept for financing projects with the demonstrated economic benefits needed to support it. I am opposed to projects that do not have the economic benefits that the toll seeks to monetize. Ramming infeasible projects through just because you can is a recipe for economic disaster. Bad tax policy has a bad habit of making bad things happen. Duh.

Tolling defenders claim that the toll is not a tax--you can simply use another route to make the trip. This makes about as much sense as saying sales taxes aren't taxes because you can simply choose not to eat. Or not to wear clothes. Or not to use deodorant. Or not take your anti-psychotic medication. You can choose to be hungry, naked, smelly and crazy and go tax free, right? Your choice.

Come on, folks. If the government makes you pay for the privilege of doing something, it's a tax.

From an economics perspective, a tax and a toll evoke the same response in how businesses and consumers behave in the marketplace. For consumers, the cost is a new item in their budget constraint. To the extent feasible the consumer will avoid paying it and will forego buying something else to pay what cannot be avoided. For businesses, the full tax burden will be added to the cost of the goods sold and the owners will absorb the risk of reduced sales as a result.

A toll and a tax are interchangeable in a model of any economy burdened by either.

So, henceforth this space will use the term "tax" when referring to the cost burden of this project. When you correct the terminology you change the narrative.

"Toll" is a four-letter word.

Even famous people avoid taxes. We're not famous here, but we have our ways.

Under current Alabama law, anyone aged 19 and over can buy a car without being required to simultaneously register the vehicle with the state. This is because Alabama law requires car owners to provide proof of liability insurance when registering their vehicle. Not surprisingly, cars are cheap in Alabama and they're easy to obtain. Look around -- $99 sign and drive (SAD) car dealerships are thriving from one end of the state to another. They don't care about your credit and they might not even check to make sure your driver's license is valid.

Those cars will become very popular if the Mobile River Bridge & Bayway project is built as a taxed route. No tag means no tax.

Alabama drivers are also notorious for failing to renew their vehicle registration, and part of that is because they have also failed to renew their liability insurance. For many, paying the first period's insurance premium and defaulting on the plan is part of the SAD game. But the state still has a name and address for that tag, expired or not. That tag promptly disappears.

This will also be a popular choice among commuters in Mobile and Baldwin Counties, especially among lower income folks. These are the people for whom a new $90 monthly tax has crowded the budget constraint.  Do they renew registration and insurance? Do they look for work in a place with no transportation tax? Do they take a look-see at what others are doing to avoid the tax?

We can also reasonably expect the emergence of a black market dealing in fake or stolen license tags and stolen or hacked electronic transponders. Craigslist and similar sites will surely have any of these on offer.

Tough choices will be made by consumers and businesses and none of them will be beneficial to the revenues of the tax collector.

The ALDOT/FHWA team has decreed that the number of invalid tags using their project will amount to about 5%, and that average weekday traffic on the 2030 established and taxed project will be about 70,000 vehicles. Doing some math gives us approximately 3,500 tax violators per weekday.

If we conservatively assume 48 4.5 day work weeks, we could see 756,000 accused tax cheats every year.

Goat Hill has a plan for all these tax cheats. Alabama Senate Bill 347 flew through the 2019 legislative session, giving the state the power to assess administrative fees on unpaid tax violators; to non-renew vehicle registration of vehicles for failure to pay a tax violation and assessed administrative fees; and to further provide reciprocal agreements with other states or jurisdictions that have also pursued the madness of directly taxing drivers.

What percentage of the 756,000 tax cheats will bite the bullet and pay up? Half, maybe?

That leaves the other half as unrepentant tax cheats in the eyes of the pointy heads in Monkeytown. They are coming after you, you rebellious Gulf Coastians.

This is going to be our administrative and judicial nightmare:

• There won't be enough local yokels or state troopers on the road to pull over and either ticket or tow the tax dodgers. 
• There won't be enough room in the impound lots for tax dodging vehicles to be held pending resolution. Towing companies will feast on the carnage.
• Traffic court dockets will be jam packed with transportation tax dodgers. Our municipal and district court systems will have much less docket space for the real public safety threats like DUIs, reckless drivers, scene leavers and drug traffickers. Real bad guys will get away.
• What will be done with the people who are on their third or fourth tax cheat citation? Jail them?
• Vehicle registrations will plummet while $99 SAD auto sales will be steady or climbing.
• There will be thousands more unregistered and uninsured vehicles on our roadways every year. This is a serious threat to the personal and economic well-being of every safe driver on the road.
• People will inevitably lose their cars and will also lose their jobs. Another $99 SAD?
• Traffic on the tax-free route will skyrocket and traffic on the taxed route will drop. 
• The Africatown Community will be swamped with tax-avoiding but otherwise decent and courteous drivers on the tax free route.
• The taxed route operator's revenues will suffer, leading to an inevitable increase in the tax rate. The increased tax rate will then drive even more consumers to either constrain their other spending or (more likely) join the growing hordes of tax cheats.
• The economic output of Mobile and Baldwin Counties will drop. Home prices will fall. Sales tax collections will contract.
• The Alabama Gulf Coast will be less competitive in recruiting new business. Who wants to locate in an area with depressed personal income, slumping housing prices and higher-than-average unemployment?

This has a very good chance to be the economic picture of the Alabama Gulf Coast in about 10 years, if the MRB&B project is built as planned. 

It doesn't have to be this way. If the ALDOT and FHWA team go back to the drawing board, they can develop an economically feasible plan.  That plan would likely follow the lead of the 2014 EIS, which never recommended taxing the plan's users. That plan would also seriously consider the economic effects of hurricane and storm damage risk. Don't hide behind a leeway-laden standards recommendation. Don't fearfully try to design away 100% of the risk posed by an improbable storm event occurring with an unlikely sea level rise. Instead, compute the expected annual risk of a wide array of alternatives and seek the plan that best balances cost with risk reduction benefits.

The only other alternative is the no-build alternative. The people of the Alabama Gulf Coast are used to storms and hurricanes. We're used to the occasional weekday traffic jams on the Bayway. We know better than to try making an optional Bayway trip on check-in days during the summer tourist season. 

We're ok with it as is.

ALDOT and FHWA probably violated their own guidance by Doc Dropping environmental clearance

Pardon me while I go policy wonk on you.

On August 16, 2019 ALDOT and FHWA published a combined Final Environmental Impact Statement and Record of Decision (FEIS/ROD) on the proposed Mobile River Bridge and Bayway. This surprised a lot of people, who believed that the changes made between the 2014 EIS and the May 2019 Supplemental are significant enough to make them follow standard NEPA procedure and wait 30 days between publishing the FEIS and executing the ROD.

FHWA guidance allows for "accelerated decisionmaking," but under some fairly strict limitations.

---

Section 1319(b) "Single Final EIS and ROD Document"

Section 1319(b) directs the lead agency, to the maximum extent practicable, to expeditiously develop a single document that consists of an FEIS and ROD, unless certain conditions exist. Traditionally, and in accordance with the CEQ Regulations (40 CFR 1506.10(b)(2)), FEIS and ROD documents are issued as separate documents with a minimum 30-day period between the FEIS and ROD. Section 1319(b) directs the lead agency, to the maximum extent practicable, to combine the FEIS and ROD into a single document unless:

1. The FEIS makes substantial changes to the proposed action that are relevant to environmental or safety concerns; or
2. There are significant new circumstances or information relevant to environmental concerns and that bear on the proposed action or the impacts of the proposed action.

---

Could demolishing approximately 7 miles of 4-lane Bayway and replacing it with roughly the same length of 8-lane Bayway be a substantial change to the proposed action? One might think that the approximate $1 billion cost increase of doing so is "significant new information."

Could completely changing the proposed action from a toll-free bridge to a toll-bearing bridge and Bayway be considered significant?

Could the economic effect of imposing a maximum $6 toll to pay for the new bridge and new Bayway bear on the impacts of the proposed action?

I guess it depends on who you ask, but I'd love to hear an answer from someone here.

There are still a number of unresolved issues with the decision documents:

• ALDOT and FHWA have still not provided a demonstration that this project's economic benefits equal or exceed its economic costs. A calculation of the crude benefits estimation in the 2014 DEIS (indexed to 2019 dollars) and compared to the estimated cost of this monstrosity produces an embarrassingly low benefit-cost-ratio of less than 0.50-to-1.0. This would mean that $0.50 would be removed from the economy for every $1.00 invested in the project (this doesn't even account for the drain imposed by the toll plan).
• They have still not provided a complete risk analysis of replacing the existing Bayway, choosing instead to hide behind a suggestion that it be raised to withstand not just a Hurricane Katrina but the Mother of all Gulf Hurricanes. What is the expected annual risk of leaving the Bayway at the current height and adding lanes to it?
• They have still not addressed the glaring and potentially unethical use of various inflation rates for cost and revenue forecasts. At best, someone should be permanently barred from doing any more cash flow forecasts on this project. At worst, someone could face charges for fraud.
• et cetera

These comprise just a handful of the 19 issues I raised with the draft decision document last month. None have been addressed and they are in the public record.

As an extra point, here's an interesting story from al.com's John Sharp from 2014. Please read it.

The Facebook Group "Block the Mobile Bayway Toll" is pure American greatness

In less than three months' time, a Facebook Group begun in opposition to a plan to finance a new bridge project for the I-10 corridor between Mobile and Baldwin Counties has grown from a handful of the plan's skeptics into a grassroots movement of just under 50,000 members.  By the time officials release their updated plans in late August or early September 2019, the group's membership will likely top 50,000 and could even begin approaching 100,000.

The bridge project sparking the group has been discussed and planned since the mid-1990's. For about a quarter century transportation planners, business leaders and elected officials have contemplated a fifth route over the  estuary separating Mobile and Baldwin Counties (I'm including the I-65 "Dolly Parton" bridge). Only very recently was the possibility of a toll bridge even whispered about, and even then only in small circles. In 2018 the whispers became a rumor. In early 2019 the rumor became a reality and the boldfaced announcement of a $3 to $6 cost has led to revolt.

Alabama State Auditor Jim Ziegler was the primary originator of the group, acting on his own time and through his personal Facebook profile. He's enlisted the support of a few assistants but the group discussion essentially runs itself. It's like a 24/7 townhall meeting or non-stop assembly in the public square.

Keep in mind that the American Revolution was a movement that transformed world politics and it all began from a tax dispute. The United States of America owes its existence to the determination of a bunch of unruly, ungrateful and unsophisticated simpletons who believed that their alleged betters most certainly did not know what was best for them. No, this rough-hewn bunch of rednecks had different ideas, and the faraway elites were either going to pay attention or pay a price.

Despite all of the high-minded ideals of equality, neutrality and secular social welfare propounded by today's pointy-headed progressives, the one thing that Americans still love more than anything else is a good old-fashioned rebellion. 

No one in the Facebook Group is advocating an armed revolt. The people of Alabama's only coastal counties are peaceful and law abiding ladies and gentlemen. But facing the unfair burden of a $6 fee for the simple privilege of traveling from one side of Mobile Bay to the other is just too much to bear.

As I am writing this, there is breaking news of a public opinion survey of the two affected counties. According to a sample of 1,495 registered voters, 77% are opposed to the toll bridge plan and 23% support it. There are about 300,000 registered voters in the surveyed population. At least 50,000 of them are motivated enough to have joined a social media group to show their opposition. That number is growing by hundreds each day. The group is active and vocal in their stance. The people have an unfiltered voice and they're speaking loudly.

"No Toll!" stickers and yard signs are popping up everywhere on both sides of the bay. Call-ins to local radio talk shows are all about "that toll bridge." Local TV stations have at least one segment on the subject in every broadcast and have dedicated sections of their websites for stories related to the bridge. It will be the most talked about item in the news for 2019. It will certainly carry into 2020, a Presidential election year that turns out voters in big numbers.

No state or local official who hopes to win reelection or reappointment ignores public sentiment like this. The current bridge and bayway plan may make perfect sense to perceptibly faraway officials in much the same way that the 1765 Stamp Act and 1773 Tea Act made perfect sense to Parliament and King George III.

Whether you are reading this as one of the three-fourths opposed to the plan or the one-fourth in favor, You have to marvel at the fact that the American public's penchant for speaking up and taking action is alive and well.

Tell a bunch of Americans to do what they're told and they'll tell you to go to hell and help you get there.

It's a beautiful thing. It's America, baby.

To stop the toll bridge, stop talking about the $2.1 billion alternative...

... and start talking about the alternatives not considered by ALDOT and the Federal Highway Administration.

The National Environmental Protection Act (NEPA) doesn't prohibit unwise decisions. It only prohibits uninformed ones. This truth is worth remembering as we talk about this project to each other and to elected and appointed officials because this decision as proposed is uninformed.

In a rambling op/ed essay submitted to Alabama media outlets last week, Governor Kay Ivey wrote as if the $2.1 billion plan that includes replacing the existing 4-lane Bayway with a new 8-lane structure is the only viable option. It is not.

That plan calls for the new structure to be elevated and built to "withstand the 100-year design storm including the 100-year sea-level rise." (SDEIS Vol I, p. 32)  In layman's terms, this is a structure built to hold up in a hurricane with a 1% chance of occurring in any year and driving a water level that is only going to occur sometime between now and 100 years into the future. (Assuming of course that one accepts the United Nations' climate change projections.)

In Joe Sixpack terms, this is like offering only the Champagne Option to a guy with just enough money to buy Miller Lite.

This was the only alternative that was modeled by ALDOT's coastal engineering team. There were no other alternatives considered. In fact, Appendix G (SDEIS Vol II) didn't model the existing Bayway to determine what combination of storm surge and sea level rise would cause enough damage to it to render the expected risk unacceptable. That is, we don't know the expected annual risk of leaving the existing Bayway as it is. So how can we know whether the expected annual risk of the proposed structure is acceptable?

Why shouldn't we demand it be built to a standard that survives the 200- or 500-year storm with 200- or 500-year sea level rise?  Why is the 50-/50- standard not acceptable?

For that matter, will a modified, storm-armored and expanded 6-lane Bayway reduce expected annual risk enough to be economically feasible? Economically feasible without a toll, perhaps?

Governor Ivey wrote, "[to] those who say the bridge can be built without a toll, I simply ask you to show us how."

We should reject the premise of this request. It assumes that "the bridge" must be built as proposed. Accepting the premise causes plan opponents to talk about finding different means of paying for it when the discussion should be about alternatives to it. It further assumes that the public is unwilling to accept a level of risk simply because officials deem it unwise to do so.

Last week in this space, we saw that nowhere in the public process of preparing the necessary NEPA documents is it stated that this project's economic benefits are equal to or greater than its costs.

The Benefit-Cost Ratio is a mathematical expression of a project's worth to taxpayers. A BCR greater than 1-to-1 means that the project will improve our economic well being. A BCR less than 1-to-1 means that the project will harm our economic well being. A toll would only make our state's agony worse.

Until this project's BCR is proven to be greater than 1.0, the statement "the cost of doing nothing is too high" is patently false.

How much will it cost us to do nothing, Madam Governor? More importantly, how much will it cost us to do something else? We don't know.

Remember... NEPA doesn't prohibit unwise decisions. It only prohibits uninformed ones.

Read my full review of the project's NEPA documents here.

Tolling for the Mobile River Bridge is a symptom, not the problem

The largest public outcry over the planned Mobile River Bridge and Bayway is over the proposed $3 to $6 toll on the interstate route between the Virginia St interchange in Mobile and the US 98/90 interchange in Daphne.

But the toll plan is a symptom of a deeper and complex problem. Tolling causes the greatest public angst in the same way that pain causes the greatest personal objection to a deteriorating knee or hip joint. If you treat the symptom you might alleviate some of the pain for a little while.

If you don't get treatment for the real problem--you will never really be free of the pain it's causing you.  Sometimes, addressing real problems means making a sacrifice or two, and facing some hard decisions about what you want vs what you really need.

The real problem with the Bridge & Bayway plan is a poorly executed feasibility investigation and an unnecessary belief that 100% of risk can be avoided with overbuilding. 

There are less costly alternatives that have not been evaluated. There is a level of storm surge vulnerability that we are willing to accept that is well below what might happen in the 100-year storm with 100 years of sea level rise driving it.

This project's problem isn't the toll. This project's problem is a failure to meet a basic NEPA requirement to evaluate a full range of alternatives. It won't be the tolling pain that kills the project. It will be the NEPA failure.

By now, it should be clear that nowhere in the public process of preparing the necessary NEPA documents is it stated that this project's economic benefits are equal to or greater than its costs. 

The Benefit-Cost Ratio is a mathematical expression of a project's worth to taxpayers. A BCR greater than 1-to-1 means that the project will improve our economic well being. A BCR less than 1-to-1 means that the project will harm our economic well being. A toll would only make our state's agony worse.

Until this project's BCR is proven to be greater than 1.0, the statement "the cost of doing nothing is too high" is patently false.

Even if a Federal Leprechuan drops a $2.1 billion pot o' gold in the heart of Crichton, it will still only finance a bridge and Bayway that is overbuilt and unnecessary. 

Reformulate your plan Madam Governor, and you will cure the problem.

(Click here for an older but still helpful guide to NEPA.)

Read on for a little sophomore-level economics geekiness.

So, why hasn't the BCR been shown to be favorable?

A part of the answer is on the cost side of the BCR. For some reason, the engineering side of the planning team has adopted a belief that 100% of risk can and should be avoided, and that it's possible to design, build and operate a risk-free system.

In this case it's storm surge risk caused by hurricanes and tropical storms. The planning team has decided that the existing Bayway "is vulnerable to storm surge." The team has also decided that to solve this problem, a new Bayway will be built and elevated, designed to withstand the 100-year flood event that could occur after 100 years of sea level change.

The 100-year flood has a 1% chance of occurring any year. The 100-year sea level rise is expected to occur between now and 100 years into the future. So, we are being asked to pay for a new Bayway designed to hold up in a 1% chance storm that might occur up to 100 years from now. 

That's expensive.

Another part of the answer is that the planners have never truly attempted to investigate the full range of potential beneficial economic effects. Natural resource and public infrastructure economists have developed many tools to measure project benefits, from travel cost savings to risk reduction and from improved labor productivity to more enjoyable recreation experience. All of these are measurable (or at least estimable). 

But no serious investigation of economic benefit has ever been done. There have been reconnaissance level look-and-see efforts, but no real seeking of the answer to the question of why this is a good idea. Simply asking us to accept that it's a good idea is not good enough to ask us to pay more than $1,000 each year.

Engineers and politicians are lousy economists. They are better off finding qualified economics professionals and letting them do that heavy lifting. Then, the engineers and politicians can ask them how they can (and cannot) tell the public why their plan is a better idea than doing nothing.

A couple of other theoretical points that should make sense to most folks:

Proposing a toll system operated by a third party frees the planner from the incentive to consider system total costs. The planners are indifferent to rising costs because their budget constraint is minimally affected. 

Overbuilding--also referred to as freeboarding--frees planners from making a tough decision on what is an acceptable and affordable risk. Mandating that a third party adhere to a design standard that avoids all but insignificant risk frees the planner from responsibility to achieve that level of performance. 

Risk seekers or risk buyers will load that system up to the cost of carrying the risk of very low frequency events. This means that the third party will hedge their bets. They will try to meet the standard, but they will also price in the costs of system failure. 

Read my full review of the Mobile River Bridge SDEIS here.

Five Quick Facts, not rumors, about tollroad economics

Five Quick Facts, not rumors, about the economics of a toll bridge:

1. Tolls directly harm state and local tax revenues. Tolls impose an additional cost on all in-person transactions, reducing sales and reducing sales taxes.

2. Tolls are always regressive. Tolls represent a greater portion of disposable income to lower income users than higher income users. And, those with lower incomes are more likely to be compelled by work obligations to either pay the toll and use the road or find less efficient alternate routes.

3. Tolls harm economic competitiveness. The state imposing the toll drives up the cost of everything, placing the affected state or area at a competitive disadvantage compared to areas with toll free transportation.

4. Tolls harm labor mobility. A wage earner is less likely to accept better employment located across a tolled roadway if the wage offered does not cover toll cost.

5. Tolls incentivize law-breaking. Counterfeiters and other black market operators will thrive. Counterfeit tags, tagless vehicles, tag-sharers, tag-concealers and phony transponders will all respond to a tolling regime by finding new and innovative ways to beat the toll.

Read my full review of the Mobile River Bridge SDEIS here.

Perspective: The Mobile Ship Channel and the Mobile River Bridge

Since 2014, the U.S. Army Corps of Engineers has been involved in the development of a plan to deepen the Mobile Harbor Ship Channel to accommodate larger vessels. The process resulted in a General Reevaluation Report (GRR) and integrated Supplemental EIS, a draft of which was released to the public in 2018. That decision document is in the process of being finalized and almost all of the significant public issues with the project have been resolved.

It's useful to compare that decision document to the one submitted by ALDOT for the Mobile River Bridge and Bayway Project, which was submitted to the public in March 2019.

It should come as no surprise that the USACE documents were as thorough as the ALDOT submissions were scant.

USACE submitted a bona fide Supplemental Environmental Impact Statement. It is not a whole scale replacement for an earlier EIS. While they didn't really have to do so for a Supplemental, USACE did a scoping investigation before beginning their decision document. Extensive public involvement was conducted so that everyone involved was on the same page as to what the decision document would contain.

ALDOT used the 2019 SDEIS as a full replacement of their 2014 EIS. They evaluated alternatives not contemplated in the 2014 document and evaluated none of the 2014 alternatives using the new data purported to be the reason for a Supplemental.

Note: You usually don't need to do Scoping for a Supplemental because the scope is defined by the original EIS. If you are making major changes to the proposed project, a new EIS is required and a new EIS means Scoping.

USACE extended public comment period for their Draft SEIS at least twice, with the last 30-day extension ending July 18, 2019.

ALDOT has yet to respond to my formal request for additional time to prepare and formally submit public comment.

USACE provided a detailed cost estimate, and annualizes costs to incorporate expected future operations and maintenance costs. Costs were estimated for land-side construction activities; dredging costs; Planning, Engineering, and Design (PE&D); Supervision & Administration (S&A); Contingencies; Supervision, Inspection, and Overhead (SIOH); and mitigation.

ALDOT has provided only the briefest summary cost estimate with no breakdown by project category or feature.

USACE used constant dollar forecasting of costs and benefits (FY 2019 price levels).

ALDOT used one arbitrary inflation rate for the forecast of toll costs and and a different, higher arbitrary inflation rate for the forecast of toll revenues.

USACE conducted a thorough economic analysis. They displayed net project benefits and computed the project Benefit-Cost Ratio, demonstrating that every dollar invested in the project would produce approximately $3 in economic benefits to the national economy. If one wanted a conservative estimate of the benefit to the regional economy, a conservative regional multiplier range of 1.15 to 1.45 means that deepening the harbor with the selected plan could have a $1.4 to $1.8 billion to the regional economy.

ALDOT provided no benefit cost analysis at all. They have not stated whether the bridge and Bayway project will have a net positive economic impact to the economy. Nor have they stated whether the project will have a net negative impact.

The total project cost for dredging the channel came to approximately $409 million. The cost for a new Mobile River Bridge and replacement of the Bayway is $2.1 billion.

Why is a cost-shared effort to dredge the ship channel so well documented while the push to build a non-federally financed new bridge and Bayway so poorly documented?

You can read a full report on my review of the Mobile River Bridge & Bayway SDEIS here.