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The southwestern corner of New York State, bordered by Pennsylvania on the west and south, has long suffered from high unemployment and low income levels compared to most of the rest of the state. The region was also perceived as lacking good regional highway access, an issue that was recognized in 1962 when the New York State Legislature (under Highway Law 340-C) authorized the route of the Southern Tier Expressway as an improved 4-lane highway following the east-west path of the old NY 17 through New York's southern tier.
The region's economic needs and accessibility limitations were again also recognized in 1965 as the region was included within the jurisdiction of the newly-created Appalachian Regional Commission (ARC). The Southern Tier Expressway route was subsequently put on the map as Corridor "T" of the Appalachian Development Highway System .
Over the 1970's, New York State continued to upgrade the quality of the NY-17 highway route as a 2-lane road. In 1976, a Final Environmental Impact Study (EIS) was completed for upgrading of the western part of the route to a four lane freeway. This portion of NY-17 traversed Chautauqua, Cattaraugus, Allegany and Steuben counties in New York, with a further link in Erie County, Pennsylvania to connect to I-90.  (See later Exhibit 2-2 for a map showing the location of these counties.) The EIS noted that:
"...The purpose of a completed Southern Tier Expressway, in part a component of the Appalachian Development Highway System and a supplement to the Interstate Highway System, is to open up areas with a developmental potential where commerce and communication have been inhibited by lack of adequate access. ""...A review of previously identified problems, together with an analysis of the relationship between transportation and economic prosperity, have established the following interdependent needs within the Southern Tier Region. These problems were also identified as important public concerns during the Community Involvement Program and include: inadequate regional access, insufficient economic activity, low levels of employment and income, underdeveloped community facilities and services, concern for traffic safety..."
The portion of road east of Olean (mainly in Steuben and Allegany counties) was first widened from two to four lanes. In the 1980's, the portion from Olean to Jamestown (mostly Cattaraugus county) was widened to four lanes. At the end of that decade, the portion from Jamestown to Chautauqua Lake was widened. However, it was not until the mid 1990's (circa 1997) that the portion of highway west of Chautauqua Lake to I-90 was completed as a four lane highway. (This includes parts of Chautauqua county in New York State and Erie County in Pennsylvania). And it was not until 1999 that the bridge across Chautauqua Lake (saving significant time and distance for travelers) was completed to replace the cross-lake ferry service and the roundabout 2-lane route around the lake. At that time, work was also completed on upgrading shoulders and interchanges along the full length of the highway route to interstate highway standards.
When the 185-mile route was completed in 1999, it finally provided the region with a high-speed, limited access freeway connection to the major cross-country route of I-90. On December 3, 1999, it was formally designated as Interstate 86. That day, interstate highway markers were unveiled for the new freeway from US 15 (near Corning) all the way west to I-90 (near Erie, Pennsylvania). Future plans call for extension of I-86 by an additional 204 miles along the NY-17 alignment to connect to I-87 (the New York Thruway), thus providing a further connection to the New York City region.
Funding for the new Interstate highway came from a wide range of different federal highway funds, Appalachian Regional Commission funds, NYS DOT funds, and transportation programs that facilitated a large number of incremental improvements and construction projects over more than 20 years.
The Southern Tier West Regional Planning & Development Board (STW) is a Regional Planning Board, an agency created in 1969 to help coordinate and enhance planning and development activities in Allegany, Cattaraugus, and Chautauqua Counties of New York State. That same year, the newly created Appalachian Regional Commission (ARC) designated STW as one of the Local Development Districts (LDD's) in the Appalachian Region. In 1976, the US Economic Development Administration (EDA) designated STW as an Economic Development District (EDD) responsible for coordinating EDA-funded investments in the region.
Following completion of the Southern Tier Expressway in 1999, STW staff embarked in a series of initiatives to identify economic development opportunities and impacts provided by the highway change. Over 2000-2001, the Appalachian Regional Commission funded a study on Assessing Economic Opportunities from Appalachian Development Highways.  STW became a part of that study to assess how the new Southern Tier Expressway could affect its future economic development opportunities.
This study is part of another STW initiative. Over 2001-2002, the Federal Highway Administration (FHWA) funded a study on Using Empirical Information to Measure the Economic Impact of Highway Investments.  That study included a literature review of pre/post measurements of highway impacts, a catalog of data sources and a method to measure and analyze economic impacts. As follow-up, FHWA sought to test the method by applying it to recently completed highways in rural regions. STW agreed to work, with the assistance of FHWA and its consultant team, to collect information on impacts to date associated with completion of the Southern Tier Expressway. This report represents the outcome of that effort.
Completion of the western part of the Southern Tier Expressway (now I-86) was motivated in part by economic development considerations. The highway is part of the Appalachian Development Highway System, and the highway construction was partially funded from that source. Other funding came from the Federal Highway Administration (FHWA) and the New York State Dept. of Transportation (NYS DOT), following a consultant study confirming expectations that the project could potentially help the region achieve needed economic growth and development. Given such hopes and expectations, it is natural to ask the question of whether the new highway is indeed starting to provide such opportunities. The Southern Tier West Regional Planning and Development Board has actively supported this study to examine that question, in order to improve the region's understanding of emerging changes in the economy and land development as well as to identify future opportunities for further growth.
The Federal Highway Administration, which supported this study through contractor assistance, has a broader objective - first to test the method of measuring and analyzing economic impacts, and then to build a base of information on the actual extent of economic impacts associated with new highways in rural regions. A series of recent reports, completed as part of this same FHWA contract (cited in footnote 2 on the prior page), have sought to summarize current knowledge and evaluation methods for measuring such impacts, and to provide guidance for future studies. Those reports indicated that there have been relatively few studies that have rigorously measured the actual impacts of highway projects. They include a guidebook that lays out basic methods for measurement of economic impacts. This evaluation of the Southern Tier Expressway was designed to follow those guidelines.
The remainder of this report is organized into four sections. Chapter 2 is a discussion of the study design, which is designed to measure a range of short-term and long-term impacts, using trend data, comparison area data and local surveys to isolate highway impacts. Chapter 3 describes the nature of changes in traffic and access conditions, and describes survey findings on local business location and land development changes. Chapter 4 presents findings from published data on aggregate measures of economic change. Chapter 5 discusses conclusions and steps needed for further analysis.