TRIP Reports: Minnesota Faces $2.8 Billion Transportation Funding Shortfall

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Minnesota Faces $2.8 Billion Transportation Funding Shortfall, Leading To Increasingly Deteriorated & Congested Roads Amid Declining Transportation Funding. Between $779 Million To $1 Billion In Needed Projects Outside Major Urban Areas Not Able To Move Forward

Amid a declining level of funding available for maintenance and improvement to the state’s roads and bridges, Minnesota faces a $2.8 billion transportation funding shortfall over the next four years, leading to deteriorating road and bridge conditions, a lack of safety improvements, and increasing congestion due to increases in vehicle travel. This is according to a new report by TRIP, a Washington, DC based national transportation organization. TRIP’s report identifies unfunded transportation projects in areas outside the Twin Cities, Rochester and Duluth areas, costing between $779 million and $1 billion, that are needed to improve conditions, relieve traffic congestion and improve traffic safety. The amount of funding available for road maintenance and improvements by the state, counties and municipalities is projected to decrease by 16 percent from FY2016 to FY2021.

The TRIP report, “Moving Minnesota Forward: Challenges in Providing Safe, Efficient and Well-Maintained Roads, Highways and Bridges,” examines road and bridge conditions, travel trends, economic development, highway safety, transportation funding, and the status of needed transportation improvements in statewide and in the Twin Cities, Rochester and Duluth areas.

Twenty-eight percent of Minnesota’s major locally and state-maintained, urban roads and highways have pavements in poor condition and 21 percent are rated in mediocre condition. Sixteen percent of the state’s major urban roads are rated in fair condition and the remaining 35 percent are rated in good condition. Due to a lack of funding, the number of lane miles of state-maintained roads in poor condition is projected to increase by 80 percent from 2015 to 2020, from 535 miles in poor condition to 963 miles.

Six percent of Minnesota’s bridges are structurally deficient, meaning there is significant deterioration to the major components of the bridge. The Minnesota Department of Transportation (MnDOT) estimates that, based on available funding, the number of state-maintained bridges rated in poor condition will increase by approximately 70 percent between 2016 and 2020, from 23 bridges to 39 bridges.

“The data is clear,” said Julie Ring, executive director of the Association of Minnesota Counties. “Minnesota’s transportation system is facing critical needs and the cost of maintaining and improving our network of roads, bridges and transit systems grows every year. It’s time for the Legislature and Governor to compromise and move forward a comprehensive transportation funding package that addresses the needs throughout our state.”

Increasing levels of traffic congestion cause significant delays in Minnesota, particularly in its larger urban areas, choking commuting and commerce. Minnesota drivers in the state’s largest urban areas lose as much as 47 hours annually as a result of traffic congestion, totaling up to $1,035 in lost time and wasted fuel each year.

The chart below details needed projects outside the state’s largest urban areas that will not have adequate funding to start prior to 2022. The report also includes needed but unfunded projects in the Duluth, Rochester and Twin Cities urban areas.

 

“With an already large transportation funding shortfall and a dwindling level of transportation funding available in the coming years, Minnesota is poised to see increasingly deteriorated and congested roads in the future,” said Will Wilkins, executive director of TRIP. “Additional transportation funding will allow the state to move forward with dozens of needed projects that will provide a smoother, safer and more efficient transportation system for drivers, and allow the state’s businesses to maintain and expand their competitive edge.”

Executive Summary

A decade after the nation suffered a significant economic downturn, Minnesota’s economy continues to rebound. The rate of economic growth, which is greatly impacted by the reliability and condition of the state’s transportation system, has a significant impact on quality of life in the North Star State.

Minnesota’s transportation system provides economic and social benefits by affording individuals access to employment, housing, healthcare, education, goods and services, recreation, entertainment, family, and social activities. It also provides businesses with access to suppliers, markets and employees, all critical to a business’ level of productivity and ability to expand. Reduced accessibility and mobility – as a result of traffic congestion, a lack of adequate capacity, or deteriorated roads, highways, bridges and transit facilities – diminishes a region’s quality of life by reducing economic productivity and limiting opportunities for economic, health or social transactions and activities.

The state faces a $2.8 billion shortfall in funds needed over the next four years to make needed improvements to its transportation system. The annual shortfall during this period is projected to more than double, leaving dozens of needed transportation projects throughout the state stranded on the drawing board and unable to proceed.

With population and employment growing steadily, Minnesota must continue to improve its transportation system to foster economic growth and maintain and attract business. In addition to economic growth, transportation improvements are needed to ensure safe, reliable mobility. Meeting Minnesota’s need to further modernize its transportation system will require significant local, state and federal funding.

Achieving the state’s goals for a modern, well-maintained and safe transportation system will require additional transportation investments and a commitment to providing roads and highways that are safe, smooth and efficient. While a sound transportation system is key to economic growth and quality of life, numerous transportation projects in the state — which are needed to improve conditions, relieve traffic congestion, improve roadway safety and enhance economic development opportunities — remain unfunded, threatening Minnesota’s future progress in providing a safe, efficient, well-maintained transportation system.

POPULATION, TRAVEL AND ECONOMIC TRENDS IN MINNESOTA

The rate of population and economic growth in Minnesota has resulted in increased demands on the state’s major roads and highways, leading to increased wear and tear on the transportation system.

Minnesota’s population reached approximately 5.5 million residents in 2016, a 12 percent increase since 2000. Minnesota had approximately 3.4 million licensed drivers in 2015.

  • Vehicle miles traveled (VMT) in Minnesota increased by 13 percent from 2000 to 2016 –from 52.6 billion VMT in 2000 to 59.6 billion VMT in 2016. VMT in Minnesota increased five percent just in the last three years (2013 to 2016).
  • By 2030, vehicle travel in Minnesota is projected to increase by another 15 percent.
  • From 2000 to 2015, Minnesota’s gross domestic product, a measure of the state’s economic output, increased by 26 percent, when adjusted for inflation. U.S. GDP increased 27 percent during this time.

ROAD CONDITIONS IN MINNESOTA

A lack of adequate funding has left more than a quarter of Minnesota’s major urban roads and highways with pavement surfaces in poor condition. Based on current funding projections, the condition of state-maintained roads is expected to deteriorate significantly in the future.

  • Overall, 15 percent of Minnesota’s major locally and state-maintained roads and highways have pavements in poor condition and 17 percent are rated in mediocre condition. Fifteen percent of the state’s major roads are rated in fair condition and the remaining 53 percent are rated in good condition.
  • Twenty-eight percent of Minnesota’s major locally and state-maintained urban roads and highways have pavements in poor condition and 21 percent are rated in mediocre condition. Sixteen percent of major urban roads are in fair condition and the remaining 35 percent are rated in good condition.
  • Twelve percent of Minnesota’s major locally and state-maintained rural roads and highways have pavements in poor condition and 17 percent are rated in mediocre condition. Fourteen percent of major rural roads are in fair condition and the remaining 57 percent are rated in good condition.
  • Due to a lack of funding, the number of miles of state-maintained roads in poor condition is projected to increase by 80 percent from 2015 to 2020, from 535 miles in poor condition to 963 miles.

  • Roads rated in poor condition may show signs of deterioration, including rutting, cracks and potholes. In some cases, poor roads can be resurfaced, but often are too deteriorated and must be reconstructed.
  • The chart below details pavement conditions on major, locally and state-maintained roads and highways in the state’s largest urban areas:

BRIDGE CONDITIONS IN MINNESOTA

Six percent of locally and state-maintained bridges in Minnesota that are 20 feet or more in length show significant deterioration and are in need of repair. The share of state bridges that are deficient is expected to increase at current funding levels.

  • Six percent of Minnesota’s bridges are structurally deficient. A bridge is structurally deficient if there is significant deterioration of the bridge deck, supports or other major components. Structurally deficient bridges are often posted for lower weight or closed to traffic, restricting or redirecting large vehicles, including commercial trucks and emergency services vehicles.
  • MnDOT estimates that, based on available funding, the number of state-maintained bridges rated in poor condition will increase by approximately 70 percent between 2016 and 2020, from 23 bridges to 39 bridges.
  • Six percent (706 of 11,016) of Minnesota’s rural bridges are structurally deficient, while four percent (94 of 2,339) of the state’s urban bridges are structurally deficient.
  • The chart below details the total number of bridges and the share of structurally deficient bridges statewide and in each of Minnesota’s counties.

HIGHWAY SAFETY AND FATALITY RATES IN MINNESOTA

Improving safety features on Minnesota’s roads and highways would likely result in a decrease in the state’s traffic fatalities and serious crashes. Minnesota’s rural roads have a fatality rate that is significantly higher than that on all other roads in the state. It is estimated that roadway features are likely a contributing factor in approximately one-third of all fatal and serious traffic crashes.

  • A total of 1,922 people were killed in Minnesota traffic crashes from 2011 to 2015, an average of 384 fatalities per year.
  • The fatality rate on Minnesota’s non-interstate rural roads in 2015 was nearly three and a half times higher than on all other roads in the state (1.33 fatalities per 100 million vehicle miles of travel vs. 0.40).
  • A disproportionate share of traffic fatalities take place on Minnesota’s rural roads, compared to the amount of traffic they carry. While rural, non-Interstate routes accounted for 34 percent of all vehicle miles of travel in Minnesota in 2015, they accounted for 63 percent of fatalities.
  • The higher traffic fatality rate found on rural, non-Interstate routes is a result of multiple factors, including a lack of desirable roadway safety features, longer emergency vehicle response times and the higher speeds traveled on rural roads compared to urban roads.
  • Rural roads are more likely than urban roads to have roadway features that reduce safety, including narrow lanes, limited shoulders, sharp curves, exposed hazards, pavement drop-offs, steep slopes and limited clear zones along roadsides.
  • Because many rural routes have been constructed over a period of years, they often have inconsistent design features for such things as lane widths, curves, shoulders and clearance zones along roadsides. Rural roads are more likely than urban roads to be two-lane routes with narrow lanes.
  • Most head-on crashes on rural, non-Interstate roads are likely caused by a motorist making an unintentional maneuver as a result of driver fatigue, being distracted or driving too fast in a curve. While driver behavior is a significant factor in traffic crash rates, both safety belt usage and impaired driving rates are similar in their involvement rate as a factor in urban and rural traffic crashes.
  • Many roadway safety improvements can be made to reduce serious crashes and traffic fatalities. These improvements are designed largely to keep vehicles from leaving the correct lane and to reduce the consequences of a vehicle leaving the roadway. The type of safety design improvements that are appropriate for a section of rural road will depend partly on the amount of funding available and the nature of the safety problem on that section of road.
  • Low-cost safety improvements include installing rumble strips along the centerline and sides of roads, improving signage and pavement/lane markings including higher levels of retroreflectivity, installing lighting, removing or shielding roadside obstacles, using chevrons and post-mounted delineators to indicate roadway alignment along curves, adding skid resistant surfaces at curves, and upgrading or adding guardrails.
  • Moderate-cost improvements include adding turn lanes at intersections, resurfacing pavements and adding median barriers.
  • Moderate to high-cost improvements include improving roadway alignment, reducing the angle of curves, widening lanes, adding or paving shoulders, adding intermittent passing lanes, or adding a third or fourth lane.
  • Systemic installation of cost effective safety solutions and devices in rural areas helps to improve safety not just by targeting individual safety problem points on a road, but also by making entire segments safer by improving those roadway segments that exhibit the characteristics that typically result in fatal or serious-injury crashes.
  • Roadway features that impact safety include the number of lanes, lane widths, lighting, lane markings, rumble strips, shoulders, guard rails, other shielding devices, median barriers and intersection design. The cost of serious crashes includes lost productivity, lost earnings, medical costs and emergency services. 
  • Several factors are associated with vehicle crashes that result in fatalities, including driver behavior, vehicle characteristics and roadway features. TRIP estimates that roadway features are likely a contributing factor in approximately one-third of fatal traffic crashes.
  • Where appropriate, highway improvements can reduce traffic fatalities and crashes while improving traffic flow to help relieve congestion. Such improvements include removing or shielding obstacles; adding or improving medians; improved lighting; adding rumble strips, wider lanes, wider and paved shoulders; upgrading roads from two lanes to four lanes; and, better road markings and traffic signals.
  • Investments in rural traffic safety have been found to result in significant reductions in serious traffic crashes. A 2012 report by the Texas Transportation Institute (TTI) found that improvements completed recently by the Texas Department of Transportation that widened lanes, improved shoulders and made other safety improvements on 1,159 miles of rural state roadways resulted in 133 fewer fatalities on these roads in the first three years after the improvements were completed (as compared to the three years prior). TTI estimates that the improvements on these roads are likely to save 880 lives over 20 years. 

MINNESOTA TRAFFIC CONGESTION

Increasing levels of traffic congestion cause significant delays in Minnesota, particularly in its larger urban areas, choking commuting and commerce. Traffic congestion robs commuters of time and money and imposes increased costs on businesses, shippers and manufacturers, which are often passed along to the consumer.

  • The chart below details the number of hours lost to congestion by the average driver in the state’s largest urban areas, as well as the annual cost of traffic congestion per driver in the form of lost time and wasted fuel.

  • Increasing levels of congestion add significant costs to consumers, transportation companies, manufacturers, distributors and wholesalers and can reduce the attractiveness of a location to a company when considering expansion or where to locate a new facility. Congestion costs can also increase overall operating costs for trucking and shipping companies, leading to revenue losses, lower pay for drivers and employees, and higher consumer costs.

TRANSPORTATION FUNDING AND NEEDED TRANSPORTATION PROJECTS

Minnesota faces a significant and growing transportation funding shortfall. Due to inadequate transportation funding in the state, many needed projects that would improve conditions, expand capacity and enhance traffic safety will not move forward, at least for the next five years.

  • MnDOT projections show that the amount of funding available for maintenance and improvements to roads and highways maintained by state, county and local municipalities will decrease by 16 percent from FY 2016 to FY 2021. The chart below details the declining funds available for roads and highways maintained by MnDOT, counties and municipalities from 2016 through 2021.

 

  • MnDOT projects a $2.8 billion shortfall from fiscal year (FY) 2018 to FY 2021 in state transportation funding for state and locally maintained roads, highways and bridges in funding needed to maintain roads, highways and bridges; improve traffic safety; and, make further modernization and capacity improvements to support economic development and quality of life in Minnesota. By FY 2021, the shortfall is expected to more than double from FY 2018, reaching $835 million. The chart below details the additional amount of funding needed each year to improve road and bridge conditions, improve traffic safety, modernize the system, and provide additional capacity. 
  • The chart below details needed preservation or reconstruction projects in Duluth, Rochester, Minneapolis-St. Paul and statewide that currently lack adequate funding to start prior to 2022. These include $429-536 million in projects in Duluth, $1-1.4 billion in projects in the Twin Cities, $43-53 million in projects in Rochester and $289-383 million in projects elsewhere in the state.

  • The chart below details capacity expansion or safety projects in the Twin Cities and throughout the state that are needed but will not have adequate funding to start prior to 2022. These projects include $768 million – $1.1 billion in projects in the Twin Cities area and $490-648 million in projects in other areas of the state. 

FEDERAL TRANSPORTATION FUNDING IN MINNESOTA

Investment in Minnesota’s roads, highways and bridges is funded by local, state and federal governments. Signed into law in December 2015, the five-year federal surface transportation program includes modest funding increases and provides states with greater funding certainty, but falls far short of providing the level of funding needed to meet the nation’s highway and transit needs. The bill does not include a long-term and sustainable revenue source. The nation faces a significant shortfall in needed funding for road, highway and bridge improvements.

  • Signed into law in December 2015, the Fixing America’s Surface Transportation Act (FAST Act), provides modest increases in federal highway and transit spending, allows states greater long-term funding certainty and streamlines the federal project approval process. But the FAST Act does not provide adequate funding to meet the nation’s need for highway and transit improvements and does not include a long-term and sustainable funding source.
  • The five-year, $305 billion FAST Act will provide a boost of approximately 15 percent in national highway funding and 18 percent in national transit funding over the duration of the program, which expires in 2020.
  • In addition to federal motor fuel tax revenues, the FAST Act will also be funded by $70 billion in U.S. general funds, which will rely on offsets from several unrelated federal programs including the Strategic Petroleum Reserve, the Federal Reserve and U.S. Customs.
  • According to the 2015 Status of the Nation’s Highways, Bridges and Transit: Conditions and Performance report submitted by the United States Department of Transportation (USDOT) to Congress, the nation faces an $836 billion backlog in needed repairs and improvements to the nation’s roads, highways and bridges.
  • The USDOT report found that the nation’s current $105 billion investment in roads, highways and bridges by all levels of government should be increased by 35 percent to $142.5 billion annually to improve the conditions of roads, highways and bridges, relieve traffic congestion and improve traffic safety.

 TRANSPORTATION AND ECONOMIC GROWTH IN MINNESOTA

The efficiency of Minnesota’s transportation system, particularly its highways, is critical to the health of the state’s economy. Businesses rely on an efficient and dependable transportation system to move products and services. A key component in business efficiency and success is the level and ease of access to customers, markets, materials and workers.

  • Annually, $519 billion in goods are shipped to and from sites in Minnesota, mostly by truck.
  • Seventy-five percent of the goods shipped annually to and from sites in Minnesota are carried by trucks.
  • Increasingly, companies are looking at the quality of a region’s transportation system when deciding where to re-locate or expand. Regions with congested or poorly maintained roads may see businesses relocate to areas with a smoother, more efficient and more modern transportation system.
  • Highway accessibility was ranked the number two site selection factor behind only the availability of skilled labor in a 2015 survey of corporate executives by Area Development Magazine.
  • The Federal Highway Administration estimates that each dollar spent on road, highway and bridge improvements results in an average benefit of $5.20 in the form of reduced vehicle maintenance costs, reduced delays, reduced fuel consumption, improved safety, reduced road and bridge maintenance costs and reduced emissions as a result of improved traffic flow.

Sources of information for this report include the Federal Highway Administration (FHWA), the Minnesota Department of Transportation (MnDOT), the Bureau of Transportation Statistics (BTS), the U. S. Census Bureau, the Congressional Budget Office (CBO),the Texas Transportation Institute (TTI) and the National Highway Traffic Safety Administration (NHTSA). All data used in the report are the most recent available.