City Streets: Investing in a Neglected Asset

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Preventive Maintenance Graphed with Typical Pavement Life Expectancy Curve Recommended Preventive Maintenance Strategy: 100 N GI 0 d 70 R p 50 c ti 25 Overlay $11.501sq yd Reconstruct @ $ 38.501 sq yd of 0 3 Consecufive Slurry Seals, 6 year intervals @ $ 2.40! sq yd Years By conducting regular maintenance and preservation work, cities can keep roads in a "good" condition, high up on the life cycle curve (see Figure 1) and avoid expensive street reconstruction. Cities that operate pavement managment systems conduct an inventory of roads, evaluating and rating streets on a pavement condition index. The index is based on a 0 to 100 scale with 100 being "very good" and a rating of 0 representing a "failed" road surface. Street ratings help guide the city in planning and conducting maintenance: when street conditions reach a certain point on the life cycle curve, the street is given the appropriate treatment and the life of the street is extended, avoiding more expensive treatments or reconstuction. Beyond the fact that street preservation saves tax payer money in the long run, there are several other benefits to using a pavement preservation method: • Expenses are more predictable; • The useful life of streets is extended; • Streets are in better condition; • There are fewer construction delays; and • .The result is a "happier driving public." CITY ROAD FUNDING NEED GAP Diminishing resources are forcing many cities to set service priorities and reduce services. The "unnoticed" service, street preservation and maintenance funding has deteriorated for many cities. Pavement preservation is cost-effective, but it requires the completion of key projects at critical times. Currently, cities do not have adequate resources to conduct properstreet maintenance and preservation, but have to triage, choosing what emergent' road treatments to provide while watching overall city road conditions slide down the life cycle curve. City Streets: Investing in a Neglected Asset -Page 4 City Maintenance Expenditures Per Lane Mile FY 2003-04 $16,OOD $12,000 $8,000 $4,000 $0 Ideal Expenditures per Lane Mile J i i~ZC p~Ll_~-J-~ Baca Ci``~ a~a~ aF ~~e ec°~ ~ci, ~e et5 e~i, Pyr ~°~ ~a~~ Syr ~~~J e~~ °~ aG° 0~~~ ~.~~` 6a G~ ~ ~ Q 9r~a 0Q ~ Cities are currently responsible for maintaining over 20,000 lane-miles of roads. Based on a 2006 survey, the League of Cities estimates that total annual city expenditures on street maintenance are approximately $123 million. However, to adequately maintain these roads, the League estimates that cities would need an additional $160 million per year. This estimate is based on Federal Highway Admistration (FHWA) estimates of the per-lane-mile cost of proper maintenance and is confirmed by local projections of cities' funding needs. FHWA's 2001 statistical report "Reconstruction, Rehabilitation, and Resurfacing Costs" estimates the annualized cost of maintaining one lane-mile of road surface at $14,626. This is a conservative figure, given that construction and material costs have increased at a rapid pace since 2001. Figure 2 shows how a selection of cities' road maintenance expenditures compare with the recommended level of expenditures per lane mile. CITY STREET FINANCING State Gas Tax Not Keeping Pace Oregon was the first state to implement a gas tax as a funding mechanism for transportation. From 1982 to 1993, Oregon's gas tax rate increased 11 times-an average of 1 cent per year. Although historically proactive in this area, the state has not increased its gas tax since 1993. The current gas tax rate is 24 cents per .gallon, which is average for most states. There are 31 states that have gas taxes of 20 cents per gallon or more, and five states that have gas taxes over 30 cents.b However, Oregon's gas tax rate is lower than most western states (see the chart at right). When these states' general sales taxes are factored in to the equation, as well as other auto fees and taxes such as personal property tax on vehicles and toll fares, Oregon's state highway fund costs are much lower than most western states. In order to conserve gas, more Oregonians are carpooling and using public transportation than in the past. The resulting loss in gas tax revenue from reduced single-occupancy driving is counter-balanced by reduced road wear. However, City Streets: Investing in a Neglected Asset-Page 5 5 10 15 20 25 30