Interrelated Challenges

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Ty Schuiling; Director of Policy and Planning, San Bernardino Associated Governments

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Interrelated Challenges

  1. 1. INTERRELATED CHALLENGES: - Growth and Congestion - Freight Movement - Air Quality & Environment - Energy, Fuels, and Prices - Transportation Finance - Economics and InstitutionsSan Bernardino Associated GovernmentsTy Schuiling, Director of Planning & ProgrammingMay 14, 2010
  2. 2. SCAG Region…forecast growth like adding thecities of Chicago and Houston in the next 25 years SCAG Region 2035 Forecast Population & Employment Growth (Millions) 2008 2035 Increase Population 18.6 23.8 28 % Employment 7.8 9.9 27% 3 3
  3. 3. Who will they be?? SCAG Region Population Growth 2005-2025 More Diverse… 4 3.7 3 2(Millions) 0.6 Older… 1 0.2 3 2.4 0 (Millions) -0.5 2 -1 NH White Black Asian Hispanic 0.8 1 0.4 0.5 0 0-14 15-34 35-54 55+ Demographic data and analysis provided courtesy Frank Wen, SCAG
  4. 4. Added households will be much older! SCAG Region Households Growth Age 2005-2025 1.5 1.2 (M n ) illio s 1 0.5 0.2 0.1 0 15-34 35-54 55+ Demographic data and analysis provided courtesy Frank Wen, SCAGAnd household composition is changing:Household Type 1960 2005 2040HH with Children 48% 32% 26%HH without Children 52% 68% 74%Single/Other HH 13% 31% 34%Source: Arthur C. Nelson, Presidential Professor & Director of Metropolitan Research, University of Utah
  5. 5. Huge Shift in Age of Population: From wage-earners to retirees Income Earners & Taxpayers1975 - Under 20 21-64 65+2000 27.5% 61.4% 11.1%2000 -2025 Under 20 21-64 65+ 31.4% 38.9% 29.7% Demographic data and analysis provided courtesy Frank Wen, SCAG
  6. 6. y y1,400,000 Growth in 65+ cohort,1,300,000 1970 - 20401,200,0001,100,0001,000,000 SCA Region G California Demographic data and analysis 900,000 provided courtesy Frank Wen, SCAG 800,000 700,000 600,000 500,000 400,000 300,000 200,000 Personal Income Taxes Paid 100,000 By Californians – by age 0 40% 70-75 75-80 80-85 85-90 90-95 95-00 00-05 05-10 10-15 15-20 20-25 25-30 30-35 35-40 $2,000 % of California 33.8% Population 35% $1,800 % of California 28.9% PIT 30% 27.5% $1,600 25.7% Average Tax We are here 25% 22.0% Paid $1,400 19.6% 20% $1,200 15% $1,000 11.7%12.3% 12.3% 10% $800 Source: California State Controller 6.2% 5% $600 0% $400 25-34 35-44 45-54 55-64 65 & Above
  7. 7. Average households by age group:$65,000 $58,889$60,000 $56,500$55,000$50,000$45,000 $44,649 $45,498 $48,108 Incomes$40,000$35,000 $29,349$30,000 $25,220$25,000 $19,744 $20,563$20,000$15,000$10,000 All Under 25 25-34 35-44 45-54 55-64 65 and 65-74 75 and Over $50,000 Over $46,160 $45,149 $45,000 $38,945 $39,340 $40,000 $38,045 $35,000 $30,782 $30,000 $26,533 Expenditures $25,000 $20,000 $22,543 $21,908 (think sales tax) $15,000 $10,000 $5,000 Source: 2000 Consumer Expenditure Survey $0 All Under 25 25-34 35-44 45-54 55-64 65 and 65-74 75 and Over Over
  8. 8. $18,000 Average Government Service Expenses by age$16,000 Health$14,000 Care$12,000$10,000 Social Public $8,000 Education Security $6,000 $4,000 $2,000 $0 0‐19 20‐34 35‐44 45‐54 55‐64 65‐74 75‐84 85 and Other Retirement All Other Public Transfers Above D r iv e r F a ta lity R a te s , 1 9 9 6 (P e r 1 0 0 M illio n V M T ) 12 M a le D riv e rs F e m a le D riv e rs A ll D riv e rs 10 Planning for 8 an aging 6 population 4 2 0 16 - 17 18 19 20-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 65-69 70-74 75-79 80-84 85 + Total
  9. 9. Indications from the demography:• Reduction in per capita income tax and sales tax revenues (principal sources of state, local, transportation funding)• Increasing demand for government services• Increased demand for small lot detached and attached residences, but a surplus of large-lot (7,000 sq ft+) homes• Increasing need for safer alternatives to the auto for our aging population
  10. 10. Transportation… Source: California Travels – Legislative Analyst, 2007
  11. 11. State gasoline tax has not kept pace with travelSystem capacity has not kept pace with growth
  12. 12. Freight: We’re No. 1! Source: US Department of TransportationEstimated Trade Value by Congressional District 13
  13. 13. Containers at West Coast Ports TEUs in (millions)Port of Oakland LocalLA-Long Beach Ports Out-of- region 0 5 10 15Share, west coast ports 14
  14. 14. New San Pedro Bay Forecast: More intact movement of goods via the Panama Canal. Development of multiple import supply chains using ports on all three coasts. Growth in trade with regions such as Europe and Latin America that favor the East or Gulf Coast ports. Increased competition from West Coast portsShould Consider: • Transport cost increases related to fuel price • Narrowing of labor cost disparities
  15. 15. Modal Market Segments (MCGMAP)
  16. 16. The Transloading Advantage Transloading of weekly shipments from Asia affords large retailers an 18-20% reduction in their total pipeline plus safety stock inventory compared to direct shipping. Regional & Regional & National DCs National DCs 1 billion sq ft ofwarehouses todayWhere will the next ½ billion sq. ft. go? Cross-dock Cross-dock Transloader Transloader s s
  17. 17. The Port and Modal Elasticity Study found: 1. Inadequate landside freight capacity will strangle port growth absent major improvements 2. Failure to address landside congestion will cause diversion/loss of market share, and loss of logistics jobs 3. Phase II analysis suggests imposition of local fees will cause diversionSource: Gill V. HicksYear Train Type Average Delay BNSF Freight 206.3 minutes2016? UP Freight 196.9 minutes
  18. 18. Community Impacts of Freight:Grade crossing delay and noise Carcinogenic air toxicsRest of Nation 48% Extreme PM2.5 Exposure South Coast Air Basin 52%
  19. 19. CARB Assessment of PM Health EffectsSCAB Cases/Year due to PM2.5 *Premature Deaths 5,400Hospitalizations 2,400Asthma & Lower Respiratory 140,000 SymptomsLost Work Days 980,000Minor Restricted Activity Days 5,000,000•1999-2000 Air Quality DataSource: California Air Resources Board
  20. 20. We are not on trajectory for timely attainment of federal AQ standards (ozone and PM2.5)
  21. 21. NOx pollution in Southern California and San Joaquin Valley also contributes to: • Increased invasive plant density and production • Increased fuel load Exceedence of critical • Increased threat of fire loads of nitrogen frequency and intensity deposition in red, where • Loss of habitat for native negative impacts to ecosystems occur due species to excess N inputs • Groundwater nitrate pollution Invasive grasses carry fireData and graphic courtesy Dr. MichaelRiverside University of California, Allen, Professor and Chair, PlantPathology and Microbiology, University of California, Riverside
  22. 22. What must be done to achieve those further NOx reductions?
  23. 23. Attain federal standards with ship and airplane emissions?
  24. 24. Need for Zero/Near Zero Emission Technologies• Plans to date include insufficient measures to actually attain federal clean air standards• Even full fleet turnover to 2010 truck standards and to the Tier 4 locomotive standards proposed by USEPA (per the RTP) will not provide sufficient reductions• This air basin must achieve zero and near-zero emission vehicle penetration far beyond levels assumed in ARB’s EMFAC model (which is also used for SB375 GHG calculations) to attain federal health standards.
  25. 25. Do we attack the air quality problem in effective ways? SB 375 – 3-5% (?) reduction in GHG from changed land use patterns, new urban design, and enhanced transit
  26. 26. % VMT Reduction by Individual Measures, 10 yr, 20 yr, 30 yr, 40 yr From Rodier (2008), UC Berkeley for the 2009 TRBBut is our approach to air quality effective? SB 375 calls for a 3-5% (?) reduction in GHG from changed land use patterns and enhanced transit
  27. 27. “So now we know: The price point is $4. At $3 agallon, Americans just grin and bear it, suck it up,and, while complaining profusely, keep driving likecrazy. At $4, it is a world transformed. Americansbecome rational creatures. Mass transit ridership is ata 50-year high. Driving is down 4 percent…Hybrids and compacts are flying off the lots. SUVsales are in free fall.” CHARLES KRAUTHAMMER, Pulitzer Prize-winning syndicated columnist, June 7, 2008
  28. 28. "Right now we have enough informationto officially call it a trend," said FederalHighway Administration spokesmanDoug Hecox. According to the survey,drivers started staying off the roads indroves last November. In March, themiles driven on U.S. highways fell 4.3%from March 2007. Steve Chawkins and Martin Zimmerman, Los Angeles Times Staff  Writers, May 24, 2008  SB375 – 3-5% VMT reduction in 10 years?
  29. 29. Technology? 2004 Chevrolet Percent 2004 Toyota Prius Savings Malibu ReductionEPA Emission Standard Tier 2 Bin 8 SULEV IINon-Methane Organic Gases (grams) 2 1,527 122 1,405 92%Carbon Monoxide (grams) 2 51,303 12,215 39,088 76%Nitrogen Oxides (grams)2 2,443 244 2,199 90%Particulate Matter (grams)2 244 122 122 50%Carbon Dioxide (lbs)3 10,470 5,330 5,140 49%EPA Fuel Economy (city/hwy)4 24/34 60/51EPA Fuel Economy (combined)5 28 55 27Fuel Consumed Annually (gallons) 436 222 214 49% Notes 1. Based on 12,215 annual mileage. 2. Data obtained from Smog Forming Pollutants Chart, EPA Green Vehicle Guide: www.epa.gov/autoemissions/0-10chart.htm 3. Calculated using (12,215 miles / Combined MPG) x (24 pounds CO2/gallon). Includes upstream CO2 emissions and end-user CO2 emissions. David Friedman, Senior Engineer, Union of Concerned Scientists. Personal communication 7/25/2003. 4. Fuel economy rating for automatic/continuously variable transmission. 5. Assumes 55% city driving and 45% highway driving. Emission Standard Key: Vehicles meeting the Federal Tier 2 Bin 8 standard produce: 4.2 g/mi of CO, 0.02 g/mi of particulate matter, 0.2 g/mi of NOx, and 0.125 g/mi of non-methane organic gases. Vehicles meeting California’s SULEV II (Super Ultra Low Emissions Vehicle) standard produce: 1 0 g/mi of CO 0 01 g/mi of particulate matter 0 02 g/mi of NOx and 0 01 g/mi of non methane organic gases
  30. 30. AIR QUALITY STRATEGIES for transportation sources Moreeffective Clean technologies (EVs, plug-in hybrids): 90%+ reductions in emissions per vehicle Pricing (increased gas tax, VMT fees, congestion pricing): 10%+ reductions in VMT in < 5 years Land use change: possibly 4% in VMT over 20 years (per Rodier) Transit: 3%(?) in VMT over 20 years (per Rodier) Infrastructure investment: little, but critical for mobility Less Note: Less effective strategies (e.g. land use and transit) can be moreeffective effective if combined with pricing and clean technologies
  31. 31. ENERGY – an Economy Powered by Fossil FuelsMathematical relations involved in the complete cycle of production of any exhaustible resource from Hubbert, M. King (1956), Pub. No. 95, Shell Development Co. Exploration and Production Research Division
  32. 32. Upstream cost of oil production Our energy outlook: petroleum Source: New York Times (2007) from US Energy Administration
  33. 33. Hubbert linearization of world production Source: The Oil Drum, Discussions About Energy and Our Future at http://www.theoildrum.com/ story/2006/1/20/193723/259
  34. 34. Chevron advertisements, 2005 & 2006
  35. 35. Oil producing countries past peak production, 2007
  36. 36. Oil production from the Majors, 1997 to 2007 Compilation by Energy Watch Group 2007
  37. 37. Research to Overcome the Energy Challenge? Graph courtesy of Kei Koizumi, White House Office of Science and Technology Policy
  38. 38. Energy Efficiency Energy produced (kinetic) per energy input (chemical or electrical) Upper efficiency limits of various technologies:Steam/external combustion: 10% single expansion, 25% multipleGasoline (internal combustion): 37%Diesel (internal combustion): 50%+Electric: 80 – 90%+, higher horsepowers more efficientElectric generation: 50%+ simple, 90% with cogeneration Various sources
  39. 39. U.S. Fuel Economy for New Light-Duty Vehicles1975–2004 Model Years Sales-Weighted Horsepower and MPG 230 59 percent more energy performance 2004 210 2003 2002 2001 190Horsepower 2000 1999 1998 170 52 percent 1997 1996 1995 more output 1994 1993 150 1975 1977 1992 1991 1978 1990 1989 130 1976 1979 1985 1988 1987 1980 1984 1986 110 1983 1982 1981 0 0 12 14 16 18 20 22 24 Miles per Gallon Sources: Environmental Protection Agency; Energy Information Administration
  40. 40. International Fuel Economy Comparison Comparison of fleet average fuel economy and GHG emission standards for new-sale light-duty vehicles Source: UC Berkeley
  41. 41. Mary Peters Secretary of Transportation — ChairpersonJack Schenendorf Of Counsel, Covington & Burling — Vice ChairFrank Busalacchi Wisconsin Secretary of TransportationMaria Cino Deputy Secretary of TransportationRick Geddes Director of Undergraduate Studies, Cornell UniversitySteve Heminger Executive Director, Metropolitan Transportation CommissionFrank McArdle General Contractors Association of New YorkSteve Odland Chairman and CEO, Office DepotPatrick Quinn Chairman, American Trucking AssociationMatt Rose CEO, Burlington Northern Santa Fe RailroadTom Skancke CEO, The Skancke CompanyPaul Weyrich Chairman and CEO, Free Congress Foundation
  42. 42. Findings of the Federal 1909 Commission 250• Public trans spending <$100B Constant 2005 Dollars (in Billions) 200• Should be spending $225B to meet long-term needs 150• Federal share should be 100 historic 40% (currently 17% of $225B) 50• But failure to maintain fee-for- use financing (eg. gas tax) will 0 increase cost to improve to >$300B Current Spending Cost to Maintain Cost to Improve (2006) (2055) (2055)
  43. 43. What is this information in combination telling us, and how can it best be used to craft public policy? Freight Movement Air Quality (PM, Air Toxics, Ozone)Transportation (Moving People) Climate ChangeEnergy Water (Supply/Quality)Land Use(Urban Form) Jobs/ Economy Housing Education
  44. 44. TAKEAWAYS:Demography:Reduction in average per capita income tax and sales tax revenues, increasing demand for servicesSmaller labor force supporting large aging and very young populationsNeed for safer transport alternatives for the aging population Increased demand for small lot detached and attached residences, little demand for new large lotEnergy:Petroleum production may be 60% of today’s by 2040, natural gas will decline more slowlySignificant near-term reductions in EROI from limitations on fossil fuel productionNeed intense focus on development of energy alternativesNear-term need for energy-efficient (not just fuel efficient) technologies to reduce demandTrend toward compaction of non-residential uses driven by increasing transport costsTransport: (people and goods)5 million more people to move, yet most (90%+) of our ‘future’ infrastructure is here todayStill expecting a doubling of freight in 20 years, need dedicated clean technology freight corridorsNeed to maximize utility of existing infrastructure
  45. 45. TAKEAWAYS #2Air Quality: Reductions from transport sector are key, attainment requires zero/near zero technologies, all modes, in 1-2 decades Fuel tax increases would help incentivize transformation Transparency essential, no more “black boxes”Greenhouse Gases: Technologic transformation needed for clean air is also most direct path to reduce GHG’s Gas tax increase and pricing measures would provide far most significant near- term result Demographic factors and energy constraints will drive land use compaction consistent with SB375.Transportation Finance: Need to double annual nationwide transportation investment if only to operate and preserve system Need to more than triple investment if fee-for-use not re-established Gas tax increase the most obvious and technically easy first step. Would: pay to preserve , operate,improve system; reduce demand (VMT reduction = GHG & pollutant reduction); incentivize fuelefficiency and fleet transformation; promote energy independence; continue to be a viable revenuesource for 10-20 years VMT fee or similar revenue source needed within 10 years, container fees needed to fund freight
  46. 46. Are our plans aligned with these factors? The good news:Responses to the various challenges are remarkably synergistic

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