• Summary
  • Highways and Bridges
  • Transit
• Highway and Bridge Spending Versus Investment Requirements
  • Average Annual Investment Requirements Versus 2000 Spending
    • Types of Improvements
  • Investment Requirements Versus Projected 2001-2003 Spending
    • State and Local Funding
    • Projected Federal, State, and Local Expenditures
    • Comparison of Investment Requirements and Projected 2001-2003 Spending
  • Comparison with Previous Reports
• Transit Capital Spending Compared with Investment Requirements
  • 2000 Capital Spending and Estimated Average Annual Investment Requirements
    • Total Capital Spending
    • Capital Spending by Asset Type
    • Capital Spending on Vehicles
    • Capital Spending on Non-vehicle Infrastructure
  • Investment Requirements Versus Projected 2001-2003 Spending
  • A Comparison of Authorized Capital Expenditures with Estimated Investment Requirements (2000-2003)
  • Comparison with Previous Reports

This chapter compares the current spending for capital improvements described in Chapter 6 with the future investment requirement scenarios outlined in Chapter 7. These comparisons are intended to be illustrative, rather than to endorse a specific level of future investment. While the analysis identifies gaps between investment requirements and current spending levels, it does not take a position as to whether or not these gaps should be closed. The impacts of different levels of investment are discussed in Chapter 9.

The size of the gap between an investment requirement scenario and current spending is dependent on the investment requirement analysis and the underlying assumptions used to develop that analysis. Chapter 10 explores the impacts that varying some assumptions would have on the investment requirements.

Exhibit 8-1 compares the difference between investment requirements and spending in this report with the corresponding difference based on the data shown in the 1999 C&P report. The first column of figures contains values shown in the 1999 C&P report, which compared 1997 spending with the average annual investment requirements for 1998-2017.

Highways and Bridges

The average investment requirements estimated for the Cost to Improve Highways and Bridges scenario in the 1999 C&P report were 92.9 percent ($45.3 billion) higher than highway capital expenditures in 1997. The estimated gap has been reduced to 65.3 percent ($42.2 billion) in 2000, and is projected to further decline to an average of 56.6 percent ($38.7 billion) annually from 2001 through 2003. The primary reason for the decrease in the gap between current spending and the cost to improve is the increased Federal funding under the Transportation Equity Act for the 21st Century (TEA-21) and larger highway capital outlays by State and local governments.

Direct comparisons between reports for the Cost to Maintain Highways and Bridges are misleading, because the definition of the scenario has changed between the two reports. As described in Chapter 7, the Cost to Maintain scenario in this edition utilizes a more ambitious goal of maintaining overall conditions and performance as measured by their impact on average user costs, while the scenario in the 1999 edition focused on a more limited goal of maintaining only the physical conditions of the highway and bridge infrastructure. While the difference between the Maintain scenario and 2000 spending of 17.5 percent ($11.2 billion), appears to be fairly consistent with the 16.3 percent ($7.9 billion difference identified in the 1999 C&P report, the nature of the gap is distinctly different. The approach used in this edition of the C&P report is more consistent with the traditional definition of the Cost to Maintain scenario used in the 1997 edition and previous editions of the report.

Transit

From 1997 to 2000, the estimated gap between current spending on transit and required investments to improve or maintain transit conditions and performance widened. These additional investment requirements are reported in 2000 dollars. An additional investment of $5.7 billion annually (63.4 percent above actual capital investment in transit infrastructure in 2000) is estimated to be required to Maintain Conditions and Performance. An additional annual investment of $11.5 billion annually (127.5 percent above actual transit capital investment in 2000) is estimated to be required to "Improve" conditions and performance. The comparable ratios for 1997 reported in the 1999 Report were 41 percent to Maintain Conditions and Performance and 110.2 percent to Improve Conditions and Performance.

Required capital investment in vehicles, on an average annual basis, is estimated to be $6.2 billion (117 percent more than actual expenditures in 2000) to maintain transit vehicle conditions and performance, and $8.1 billion (184 percent more than actual expenditures) to improve conditions and performance. Required capital investment in non-vehicle transit infrastructure (on an average annual basis) is estimated to be $8.7 billion (65 percent higher than it was in 2000) to maintain conditions and performance and $12.5 (101 percent higher) to improve conditions and performance.

These comparisons, however, overestimate the gap between capital investment requirements and future funding for transit capital investment. This overestimation results because of the lags that occur between the authorization of capital funds, the obligation of these funds and actual capital spending. Since the enactment of TEA-21, annual obligations by FTA for capital investment have grown rapidly to $7.2 billion in FY 2000 from $4.1 billion in FY 1998. As these higher levels of authorized funds are obligated and spent, capital investment will rise and the gap between actual capital spending and estimated annual capital investment requirements will decrease.