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Status of the Nation's Highways, Bridges, and Transit:
2006 Conditions and Performance
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Chapter 8: Executive Summary

Comparison of Spending and Investment Scenario Estimates: Highway and Bridge

Chapter 8 compares the investment estimates for the two illustrative scenarios introduced in Chapter 7 with current and projected spending levels. This report does not endorse either of these two scenarios as a target level of funding, nor does it make any recommendations concerning future levels of Federal funding.

Federal, State, and local capital expenditures for highways and bridges totaled $70.3 billion in 2004. Capital outlay by all levels of government would have to increase by 12.2 percent above this level to reach the $78.8 billion Cost to Maintain Highways and Bridges level. The percentage gap for highway resurfacing and reconstruction (part of the system rehabilitation component of the Cost to Maintain) is larger, at approximately 23.0 percent. In contrast, capital expenditures for bridge rehabilitation and replacement (also part of system rehabilitation) were 16.6 percent higher than the estimated annual cost to maintain the current economic backlog of bridge improvements in constant dollar terms. This is consistent with the reduction in the number of deficient bridges observed in recent years.

2004 Capital Outlay by All Levels of Government vs. Highway and Bridge Investment Scenario Estimates. Horizontal bar chart showing investment levels in three categories. The value for 2004 capital outlay is 70.3 billion dollars. The value for cost to maintain is 78.8 billion dollars. The value for maximum economic investment is 131.7 billion dollars.

An increase in capital outlay of 87.4 percent above current levels would be required to reach the projected $131.7 billion Maximum Economic Investment level for highways and bridges.

The distribution of funding by investment type suggested by the investment scenarios developed using the HERS and NBIAS models depends on the level of funding. In 2004, 39.1 percent of highway capital outlay went for system expansion, including the construction of new roads and bridges and the widening of existing facilities. This is very close to the percentage suggested by the "Cost to Maintain" scenario to be used for capacity expansion investments (39.4 percent). However, if funding levels were to rise significantly above this level, the analysis identifies a number of cost-beneficial potential investments to combat highway congestion, so that at the Maximum Economic Investment level, 44.6 percent of total investments are for capacity expansion.

Investment Scenarios and 2004 Capital Outlay Distribution by Improvement Type. Horizontal stacked bar chart showing breakdown of investment scenarios in three categories. The values for 2004 capital outlay are 51.8 percent for system rehabilitation, 39.1 percent for system expansion, and 9 percent for system enhancement. The values for cost to maintain are 51.6 percent, 39.4 percent, and 9 percent for system rehabilitation, expansion, and enhancement, respectively. The value for maximum economic investment are 46.3 percent, 44.6 percent, and 9 percent for system rehabilitation, expansion, and enhancement, respectively.

The estimated gaps between current spending and the two investment scenarios are higher than the estimates shown in the 2004 edition of this report, which compared 2002 highway capital outlay with investment scenarios for 2003 to 2022. The estimated Cost to Maintain in that report was 8.3 percent higher than 2002 spending, and the gap between 2002 spending and the Maximum Economic Investment level was 74.3 percent.

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