[Senate Hearing 110-1238]
[From the U.S. Government Publishing Office]



                                                       S. Hrg. 110-1238

 
      PERSPECTIVES ON THE SURFACE TRANSPORTATION COMMISSION REPORT

=======================================================================

                                HEARING

                               before the

                              COMMITTEE ON

                      ENVIRONMENT AND PUBLIC WORKS

                          UNITED STATES SENATE

                       ONE HUNDRED TENTH CONGRESS

                             SECOND SESSION

                               __________

                            FEBRUARY 6, 2008

                               __________

  Printed for the use of the Committee on Environment and Public Works



      Available via the World Wide Web: http://www.access.gpo.gov/
                            congress.senate

                               __________




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               COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS

                       ONE HUNDRED TENTH CONGRESS
                             FIRST SESSION

                  BARBARA BOXER, California, Chairman
MAX BAUCUS, Montana                  JAMES M. INHOFE, Oklahoma
JOSEPH I. LIEBERMAN, Connecticut     JOHN W. WARNER, Virginia
THOMAS R. CARPER, Delaware           GEORGE V. VOINOVICH, Ohio
HILLARY RODHAM CLINTON, New York     JOHNNY ISAKSON, Georgia
FRANK R. LAUTENBERG, New Jersey      DAVID VITTER, Louisiana
BENJAMIN L. CARDIN, Maryland         JOHN BARRASSO, Wyoming
BERNARD SANDERS, Vermont             LARRY E. CRAIG, Idaho
AMY KLOBUCHAR, Minnesota             LAMAR ALEXANDER, Tennessee
SHELDON WHITEHOUSE, Rhode Island     CHRISTOPHER S. BOND, Missouri

       Bettina Poirier, Majority Staff Director and Chief Counsel
                Andrew Wheeler, Minority Staff Director



                            C O N T E N T S

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                                                                   Page

                            FEBRUARY 6, 2008
                           OPENING STATEMENTS

Boxer, Hon. Barbara, U.S. Senator from the State of California...     1
Baucus, Hon. Max, U.S. Senator from the State of Montana.........   135
Carper, Hon. Thomas R., U.S. Senator from the State of Delaware..   136
Inhofe, Hon. James M., U.S. Senator from the State of Oklahoma...   138
Warner, Hon. John W., U.S. Senator from the State of Virginia....   140

                               WITNESSES

Peters, Hon. Mary E., Secretary, U.S. Department of 
  Transportation.................................................     2
    Prepared statement...........................................     5
    Responses to additional questions from:
        Senator Boxer............................................     7
        Senator Carper...........................................    13
        Senator Inhofe...........................................    16
        Senator Voinovich........................................    22
Miller, Hon. Debra L., Secretary, Kansas Department of 
  Transportation.................................................    37
    Prepared statement...........................................    39
    Responses to additional questions from:
        Senator Boxer............................................    46
        Senator Carper...........................................    49
        Senator Inhofe...........................................    50
Kavinoky, Janet F., Director, Transportation Infrastructure, U.S. 
  Chamber of Commerce............................................    52
    Prepared statement...........................................    55
    Responses to additional questions from:
        Senator Carper...........................................    68
        Senator Inhofe...........................................    68
        Senator Voinovich........................................    70
Cohen, Gregory M., President and CEO, American Highway Users 
  Alliance.......................................................    71
    Prepared statement...........................................    74
    Responses to additional questions from:
        Senator Carper...........................................    80
        Senator Inhofe...........................................    81
        Senator Voinovich........................................    83
Hecker, Jayetta, Director, Physical Infrastructure Issues, U.S. 
  Government Accountability Office...............................    87
    Prepared statement...........................................    89
    Responses to additional questions from:
        Senator Boxer............................................   112
        Senator Inhofe...........................................   112
        Senator Voinovich........................................   113


      PERSPECTIVES ON THE SURFACE TRANSPORTATION COMMISSION REPORT

                              ----------                              


                      WEDNESDAY, FEBRUARY 6, 2008

                                       U.S. Senate,
                 Committee on Environment and Public Works,
                                                    Washington, DC.
    The full committee met, pursuant to notice, at 10 a.m. in 
room 406, Dirksen Senate Office Building, Hon. Barbara Boxer 
(chairman of the full committee) presiding.
    Present: Senators Boxer, Warner, Carper, Cardin, Sanders, 
Whitehouse, Voinovich, Isakson, Vitter, Barrasso, Craig, 
Alexander

           OPENING STATEMENT OF HON. BARBARA BOXER, 
           U.S. SENATOR FROM THE STATE OF CALIFORNIA

    Senator Boxer. The hearing will come to order.
    We are not going to have opening statements, because this 
is really a continuation of our last hearing. So unless Senator 
Inhofe has a few remarks when he arrives, if it is all right, 
we will just get right to this hearing. Because last week, we 
heard testimony from members of the National Surface 
Transportation Policy and Revenue Study Commission regarding 
their released report. And commissioners who really, we were so 
impressed with their dedication to this task. They spoke about 
the need for significant investments in our Nation's 
infrastructure, surface transportation system and also 
fundamental reform of Federal transportation projects. And the 
Commission called for the Federal Government to take a lead 
role in addressing these challenges facing our Nation.
    Again, I wanted to thank the Commission, and I know 
Secretary Peters, you served on it, you did not sign on at the 
end of the day to the recommendations, is that correct? OK. But 
I really do want to thank you, for all of the time and effort 
that you spent working with the Commission. Because I know you, 
and I know that, I am sure you were an excellent resource for 
them and enabled them to get their work done.
    So there were several recommendations on which all 12 
commissioners did agree. I am going to ask you about those. And 
also on the second panel, we will hear from representatives of 
the States, the business community, the highway users as well 
as the GAO regarding their views on the Commission's 
recommendations. So with that, unless Senator Inhofe is here to 
make a couple of statements, we will start with you, Hon. Mary 
Peters. Thank you so much, and the floor is yours.
    [The prepared statement of Senator Inhofe follows:]

       Statement of Hon. James M. Inhofe, U.S. Senator from the 
                           State of Oklahoma

    Thank you Madame Chairman. As I said in last week's 
hearing, anticipation for the Commission Report has been high. 
We must recognize that our nation's transportation needs have 
outgrown our current transportation policy. The link between a 
robust economy and a strong transportation infrastructure is 
undeniable; yet when it comes to other spending needs in the 
Federal Government, transportation is often neglected as a 
priority. As we move into reauthorization in 2009, it is the 
responsibility of Congress to continue to ensure that 
American's receive a full and effective return for the fuel 
taxes they paid into the Trust Fund. The results of the 
Commission's study will be an important part of those 
deliberations.
    First, I want to point out that although Secretary Peters 
along with two other Commissioners voted against the final 
report, there was much agreement on most of the policy 
recommendations. For the most part, all the Commissioners found 
agreement on the vast and unmet needs of our nation's 
transportation network, but where they differ is in how to pay 
for it. I have long advocated for a decreased Federal role, 
which I believe allows for greater flexibility for states to 
manage their own transportation funding priorities. It would 
appear those who wrote the dissenting views concur.
    Public Private Partnerships or PPPs are a great example of 
innovative funding ideas we will need to encourage States to 
explore. When I was Mayor of Tulsa, we did several PPPs and 
were able to better leverage scarce public funds to accomplish 
many good projects. To date, our thinking on funding highways 
has been too limited. We need to acknowledge there are other 
options. Certainly, no one should assume that PPPs are the 
magic bullet, this type of financing is not appropriate in all 
cases, but it is certainly something that must be explored 
further by States and frankly this Committee. There are several 
larger policy issues that I think need to be discussed, such as 
the length of leasing options and whether there should be any 
restraints on how States use lease payments. Finally, before 
development of these long term lease agreements become more 
widely used, we should thoroughly examine the consequences of 
foreign investment in these leases. Many argue that the 
consequences of foreign investments is minimal since the asset 
is fixed, I would tend to agree; however some concerns have 
been raised about of the loss of possible future State tolling 
revenues when tolling proceeds are diverted outside the United 
States. There is still much to learn about these lease 
agreements, and although I support them in principle, I 
consider them only part of the solution to the highway 
financing shortfall.
    I think the important lessons to take from the report are 
that if we don't take dramatic action, growing congestion and 
deteriorating pavement conditions will choke the US economy. I 
am glad that there is consensus among the commissioners that 
modal specific decisions and the current program structure are 
outdated.
    Finally, I have to comment on the proposed financing 
mechanism. I believe increasing the Federal fuel tax by the 
amount proposed in the final report is neither politically 
viable nor economically sound. Furthermore, I am not convinced 
it is necessary. Certainly, given the balances in the Highway 
Trust Fund, an increase in the fuel tax must be considered, but 
not to the level that is proposed. I had hoped that the 
Commission would have considered in more detail alternative 
financing mechanisms that could eventually replace the fuel tax 
as the primary method to collect revenue for transportation. As 
vehicles become more fuel efficient, the existing funding model 
of paying per gallon of fuel will not be effective.
    Again, I appreciate your efforts and thoughtful 
recommendations and look forward to discussing them further 
with you.

STATEMENT OF HON. MARY E. PETERS, SECRETARY, U.S. DEPARTMENT OF 
                         TRANSPORTATION

    Ms. Peters. Madam Chairman, thank you so much. I do 
appreciate the opportunity to be here today and your courtesy 
in allowing me to also testify about the Commission report.
    Over the last 20 months, the Policy and Revenue Commission 
met on numerous occasions, and we engaged in very widely 
ranging discussions addressing the Nation's current and future 
infrastructure needs. I believe the time has been well spent, 
and I value and appreciate, as you mentioned, the contributions 
by all of my fellow commissioners.
    Although I did disagree with a number of the central 
elements of the Commission's report, that disagreement in no 
way detracts from my respect for my colleagues on the 
Commission. They are to be commended for their hard work and 
their dedication.
    This week, the Administration released its Fiscal Year 2009 
budget. This budget funds the final year of the $286.4 billion 
SAFETEA-LU authorization. It is clear that we are just limping 
across the finish line when it comes to funding. The Highway 
Trust Fund's short-term future is unclear, and the long-term 
prospect is in serious jeopardy. This highlights, I believe, 
the significant demands that we are facing in the future and 
that our current policies do need a new direction.
    We are focusing at this time on better air quality, a 
reduction in our dependence on foreign oil and increased fuel 
efficiency. So it is short-sighted, in my opinion, to continue 
to depend on fuel taxes as the primary method of funding 
surface transportation. It simply is not a sustainable 
solution.
    While we may not have reached complete agreement on the 
appropriate solution to surface transportation problems, I 
believe it is critical that we come together, chiefly this 
Committee, that will have such an important role in the next 
authorization, to agree on a common definition of the problem 
and recognizing that fundamental change is required.
    I, like some of you, have spent many years working in this 
field. I have concluded that the central problem in 
transportation is not how much we pay for transportation, but 
how we pay. Our current transportation funding, an indirect 
user fee, provides the wrong incentives and signals to both 
users and owners of the system. It results on the over-use of 
the system, especially during peak periods of time.
    In fact, I believe that the chronic revenue shortfalls we 
face are more a symptom of the problem than the cause of the 
problem. Americans overwhelmingly oppose gasoline tax 
increases. And they do that because real world experience tells 
them that it doesn't provide a benefit to them. This is 
evidenced by a failure in our system performance.
    Over the last 25 years, despite substantial increases in 
Federal, State and local transportation spending, much of it 
from fuel taxes, we have witnessed a rapid growth in highway 
congestion. In the last 25 years, highway funding has increased 
100 percent; yet congestion over that same period has increased 
300 percent. This systemic failure is impacting our families, 
our businesses, our ability to compete in a global marketplace 
and of course, our environment.
    Americans have become increasingly disgruntled about the 
declining performance of their transportation systems, but they 
are unwilling to support transportation-related tax increases. 
Some in the transportation field argue that we have simply 
failed to communicate the importance of the transportation 
system to the average American. To me, however, and to other 
observers, this represents a failure in public confidence and 
traditional approaches. Public opinion surveys confirm this 
view.
    A recently released survey out of Washington State found 
that voters preferred high-speed variable tolling to gas tax 
increases by 77 to 17 percent. This survey is consistent with a 
number of others conducted across the United States that have 
found a deteriorating support for gas taxes and a growing 
support for direct user charges.
    I agree with those who call for greater Federal leadership, 
as the Commission report does. But I do not, however, concede 
that the Federal leadership simply implies a substantially 
greater Federal spending at 40 percent of the total and 
dramatically higher fuel taxes. In fact, I believe it is far 
more critical that the Federal Government establish clear 
policies, provide appropriate incentives and allocate revenues 
more efficiently than it is for a substantial increase in the 
Federal spending to occur. It is essential that we on the 
Federal level work together and demonstrate this kind of 
leadership.
    I truly believe that there has never been a more exciting 
time in the history of transportation. We are at a point where 
meaningful change is not only conceivable, but it is actually 
being implemented in various parts of the United States. We 
have before us collectively a tremendous opportunity to make 
significant changes, changes that will reverse the substantial 
performance declines in our Nation's transportation 
infrastructure to the benefit of American businesses, American 
families, and our competition.
    I thank this Committee for the opportunity to testify 
today. I look forward to answering your questions. But mostly, 
I look forward to working with you toward the next surface 
transportation organization.

    Thank you so much.

    [The prepared statement of Ms. Peters follows:]

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    Senator Boxer. Thank you.
    I am a little confused at how we are going to meet the 
needs by being, you said, more efficient. What was your other 
priority--how are we going to meet the needs being proactive? 
ReState what you said your answer is.
    Ms. Peters. Madam Chairman, I believe the answer is, and I 
can refer back to my notes and get it exactly.
    Senator Boxer. Yes.
    Ms. Peters. But my answer is that we need to prioritize, 
provide Federal leadership, prioritize what our 
responsibilities are on a Federal level, and track and 
incentivize the use of other revenues that can come to bear to 
meet transportation challenges through public-private 
partnerships, through private sector investment, a variety of 
tools where we can bring additional investment to bear.
    Senator Boxer. Yes, now I see it here. You say, clear 
policies, appropriate incentives, and allocating resources more 
efficiently are more important than providing additional 
Federal funding. I just have to say, if you knew a family and 
they were earning $10,000 a year and they came to you for 
advice and they said, you know, we want to send Johnny to 
summer camp, because the teacher says it would really help with 
his motor skills, small motor skills and large motor skills, it 
is important to his health. Would you say, just run your family 
more efficiently? Clearly, they can't.
    So I just think it is so much of a false--I know you 
believe what you are saying--but it is a false expectation for 
the people to believe that we can meet our needs as a great and 
growing and strong Nation. It is very disappointing to me. How 
we come up with $225 billion a year by simply allocating our 
resources more efficiently, encouraging States to impose fees 
such as tolls and congestion pricing, it is just not going to 
happen.
    So we need to be a little bit more forthcoming with each 
other. That is why I thought the Commission, and that 
Commission, with Republicans and Democrats and Independents, 
and they came together and said, we need to have a new sources 
of funding based on vehicle miles traveled.
    Now, a lot of us had a problem with the way you figured 
that out. But speaking for myself and Senator Inhofe, who will 
speak more, I think, eloquently, we need to really try to come 
together on this. And I find your testimony a tremendous let-
down. I don't know how many other people on the Commission 
agreed with you. Do you recall who said this is the answer?
    Ms. Peters. There were two others.
    Senator Boxer. Out of how many?
    Ms. Peters. Twelve.
    Senator Boxer. OK. So it is just very disappointing to me.
    I need to ask you a question that had to do with the 
California waiver. Because again, this is an area where I got 
no answers. Now, we know that your Department worked to contact 
Governors and Members of Congress to generate opposition to the 
California waiver request. And I asked you to describe to me in 
writing how that lobbying started, whether it was your idea 
alone, or whether others were involved. Your entire response 
was to refer us to e-mails that you had sent to Chairman 
Waxman. Well, we have reviewed all those e-mails, and clearly, 
the e-mails don't answer the question of, what were the roles 
of the people in the White House, the Vice President's office, 
CEQ, EPA and others.
    Now, I am not going to put you on the spot and ask you to 
answer this right now, but I am going to ask you if you will 
please go back and answer my questions rather than just say, it 
is in the e-mails. That is just not the proper answer to give 
the Chairman of this Committee. So I am going to ask if you 
would be willing to go back and give me responsive, complete 
and truthful answers to each of those questions within 2 weeks 
of today.
    Ms. Peters. Madam Chairman, I will be happy to respond to 
you within 2 weeks.
    Senator Boxer. Thank you. I really appreciate that.
    Senator, I think we will do early bird for this round, and 
then we will go--so it was Senator Isakson.
    Senator Isakson. Thank you, Madam Chairman. Thank you, 
Secretary Peters, for being here.
    First of all, I will take a little liberty with my time and 
express my appreciation to you. Delta Airlines, which is home-
based in Georgia, applied for a direct route to Shanghai. That 
route was approved, and after its approval we had some 
difficulties on securing the proper landing and takeoff times, 
and your Department and you personally interceded on our 
behalf. That wa successful, and I want to thank you very much 
on their behalf for doing so. It is great to have a Secretary 
that is proactive in that.
    I know also that you are a former Arizona Department of 
Transportation head, is that correct?
    Ms. Peters. Yes.
    Senator Isakson. My State of Georgia just finished--
everybody's doing joint transportation study committees, 
obviously, all over the Country, because of the crisis we have. 
The Georgia legislature did a joint study committee on 
transportation funding and issued their final report, of which 
I have a copy. In that final report, the committee recommended 
the general assembly introduce a resolution urging the U.S. 
Department of Transportation to dissolve or turn back the 
Federal Highway and Transit program to the States by allowing 
them to take over collection of the Federal fuel tax and spend 
those revenues on transportation priorities of their choosing, 
not the Federal Government's. In other words, the Federal tax 
would remain, but it would be collected at the pump by the 
State, and the State would then prioritize the spending of 
money, and it wouldn't go to Washington, get recycled and sent 
back. We have had lots of formula distribution arguments in the 
past over that.
    What do you think about that idea?
    Ms. Peters. Senator, I think it is a good idea. And I do 
recognize that there are some things that we need to take care 
of on a Federal basis. There are some things that are truly and 
uniquely in the Federal interest. But I believe that a large 
part of the decisions can and should be made by the States.
    When the interState highway system was first being built, 
Senator, State departments of transportation were relatively 
inexperienced and unsophisticated. So given what the Nation was 
undertaking with the interState highway system, it was likely 
appropriate that the U.S. Government have a very large role in 
that. That is not the case today. Having managed a DOT, I can 
support the sophistication with which they their work. I think 
that many decisions can and should be made on a State level, 
not a Federal level.
    Senator Isakson. Well, on that point, and in your comments 
with the Chairman a minute ago regarding seeking efficiencies 
and accountability in our money first before hauling off and 
raising taxes, this proposal provides in and of itself a number 
of efficiencies that would increase the amount of money, I 
think, that would end up going to paving surface transportation 
because of the streamlining of the process. Would you agree 
with that?
    Ms. Peters. Senator, I would absolutely agree with that.
    Senator Isakson. I thought it was a good--and I also agree 
that there still remains a Federal role, but it is far 
different than it was at the creation of the Eisenhower 
InterState System. In fact, many people might be interested to 
find out that in the 1970's, Federal interState highway 
construction rolled from being pretty much done by the Feds to 
where we put in a 90/10 match for State innovation in the 
completion of the interState highway system, or in some cases, 
the redoing of interchanges.
    So we actually incentivized the States to do that on the 
interState system as far back as the mid-1970's. So I agree 
that it is something we really ought to look at exploring, and 
I am glad you agree with that.
    The only other thing I will say is on the VMTs, I would 
like to hear your comments. I think Oregon is doing a 
demonstration project. I heard the testimony and came to the 
testimony last week. I would like your take on the VMTs.
    Ms. Peters. Senator, I think eventually paying directly for 
the use of the transportation system based on the time of day 
we use it, the weight of our vehicle, the number of occupants, 
a variety of things, is within reach doing so. There are 
privacy concerns that have to be dealt with, and I believe can 
be dealt with appropriately. I believe that is where we 
ultimately need to get. But the transition period, as I 
mentioned earlier, is focusing the Federal money only in the 
Federal interest, returning or letting States keep the balance 
of that, supplementing that with private sector investment, and 
moving toward a longer-term vehicle mile system.
    Senator Isakson. I am intrigued by it. I understand the 
privacy concerns. I went through that when we did the tolling 
authority in Georgia, when I was in the Georgia legislature. 
There was a real concern over cameras taking pictures of the 
license plate going through, and the Civil Liberties Union and 
a lot of people wanted to make sure it wasn't a government 
intrusion. But if we can deal with those privacy issues 
responsibly, the way we are changing the dynamics of surface 
travel with hybrid vehicles, with higher CAFE standards, the 
old just cents per gallon mechanism just does not work. We have 
to be willing to look at alternative fund-raising mechanisms 
that reflect what is going to be the reality of the 21st 
century.
    Again, thank you for your help on the direct route to 
Shanghai, and thank you for your service to the Country.
    Ms. Peters. Thank you, sir.
    Senator Boxer. Senator Carper.
    Senator Carper. Thank you, Madam Chair.
    Secretary Peters, welcome. It is good to see you. Thank you 
for joining us today.
    Just a comment, if I could. Senator Voinovich and I spend a 
fair amount of time working on infrastructure needs in our 
Country. One of the pieces of legislation that we have 
collaborated on is one that would seek to build on the 
Commission on which you have been serving. I am one who 
believes we probably try to create too many commissions in 
Federal Government, blue ribbon commissions, than maybe we 
ought to. But every now and then they do some good work. I 
believe the Commission that you served on, in this instance, 
has done good work and we thank all of you for participating.
    Senator Voinovich and I authored legislation that has 
passed the Senate and is pending in the House that would create 
an eight-member blue ribbon commission, four appointed by 
Democrats, four by Republicans, not to replicate the work that 
you have done with respect to transportation, but to look to 
other parts of our infrastructure, including water, wastewater, 
dams, levees, our rail transit and so forth, airports. Some 
people say that we are on our way to becoming sort of a third-
world nation with respect to our infrastructure. I think that 
is unduly harsh.
    I talked to a guy last week who had been to China. He told 
about his experience, landing at the airport in Shanghai, I 
think it was Shanghai. He said, you know, I didn't take a cab, 
and I didn't ride in somebody's car or take a limo to get into 
town. I guess the airport is well outside of town. He said, I 
rode on a maglev train that went, I think he said, 200 miles an 
hour. And then he said he had landed not long ago, I think it 
was LaGuardia in New York, and he talked about the cab ride, 
trying to get from LaGuardia to downtown. He compared one 
against the other.
    One of the reasons why they have that kind of system, at 
least in Shanghai, and the rest of China is not up to those 
standards, one of the reasons why they have that kind of system 
is that they have made a decision this is important. It is 
important for the Country, and they are going to pay for it. 
Sometimes I think we mislead people in our States and cities 
and counties, and at the Federal level, too, to tell people we 
can have services, we can have all kinds of things but we don't 
have to pay for it. I have long believed, as an old Governor, 
as a recovering Governor, I still believe it, that if things 
are worth having, we have to pay for them. The idea of saying 
to people, it is like we think they believe in the tooth fairy, 
you can have all kinds of things, but you are never going to 
have to pay for it. That just isn't the case.
    Let me ask, just lay out your vision of how to pay for the 
transportation system, your vision, not necessarily that of the 
majority of the Commission. Just walk us through slowly your 
vision of how we are going to pay for the kind of 
transportation infrastructure that I think we want and we need. 
How would we pay for it?
    Ms. Peters. Senator, I would be happy to do that.
    Senator Carper. Walk us through it slowly.
    Ms. Peters. I believe that we should continue to collect 
the fuel tax that we are collecting today on a Federal level.
    Senator Carper. What is it, about 18 cents?
    Ms. Peters. Eighteen point four cents, last increased in 
1993. We should continue to collect that today. But we should 
seriously redefine what the----
    Senator Carper. You can slow down just a little bit more.
    Ms. Peters. I will do that. I was one of six children, I 
had to learn to talk fast or I didn't get to talk.
    Senator Carper. Well, here you are an only child. So take 
your time.
    [Laughter.]
    Ms. Peters. Sir, I would continue to collet the gas tax 
that we are collecting today. However, I would seriously 
redefine what the Federal role in transportation is. I 
believe----
    Senator Carper. So that would be from what to what?
    Ms. Peters. I can talk about several things that I think 
should be in the Federal role in transportation. I believe that 
the interState highway system and the national highway system, 
the condition of those systems is in the Federal interest. I 
believe that interState freight transportation is in the 
Federal interest. I believe that it is in our Federal interest 
to continue the safety programs that I believe are more 
appropriately run on a national level, such as the motor 
carrier program, as well as the highway traffic safety 
programs.
    I believe that there is some research that can be done in 
the Federal interest if it indeed is supporting Federal 
interest issues. And I believe finally, sir, that there are 
projects of national and regional significance that are beyond 
what States might be able to do on their own but should be 
considered in the national interest because of freight 
movement, mobility, things like that.
    I would stop there, and I will confess to you that I am a 
minimalist when it comes to that. And in fact, even on the 
interState highway system, or the national highway system, I 
believe that we could establish standards on a national level 
that State and local governments would then adhere to and have 
the funding to adhere to as opposed to those moneys being kept 
by the Federal Government.
    Senator Carper. And they would have the funding by?
    Ms. Peters. I am sorry?
    Senator Carper. You say the States would have the funding 
to do, from what sources?
    Ms. Peters. We would return the rest of that, or ideally, 
as Senator Isakson mentioned, let the States keep that so it 
doesn't take on a Federal identity, so States can use it the 
way they would use other State moneys within the State.
    I would supplement that, sir, with private sector 
investment in the near term where it is appropriate to do so, 
where it can attract private sector investment. An example that 
I would give you would be in Southern California, on several 
routes there that have what we call demand pricing, that is a 
toll that varies by time of day or the level of traffic, they 
get 40 percent greater throughput on the lanes that are 
dynamically priced than they do on adjacent so-called general 
purpose lands.
    So attract private sector investment, improve the 
efficiency of the road system that we have today by using 
pricing, and in the long term, we should move to some kind of a 
vehicle miles tax system that would have us pay the cost of 
using that system, varying again by time of day, weight of 
vehicle, other factors.
    Senator Carper. Thanks for your response.
    Madam Chair, will we have a second round?
    Senator Boxer. I am not sure.
    Senator Carper. Thanks so much.
    Senator Boxer. Senator Voinovich.
    Senator Voinovich. Thanks very much for being here today 
and thank you for your service. You have been terrific over 
there.
    I remember the debates that we had during SAFETEA-LU. I was 
one, with several others, who said that the money was 
absolutely inadequate, that the money that we, and I remember 
the Administration threatening we wouldn't go to $318 billion, 
we had to be at $285 billion, and we nickled and dimed all over 
the lot. At the same time we were spending all that money on 
infrastructure all over the world. I just couldn't believe it. 
I said that wouldn't even keep up with inflation. We have 
fallen behind. Actually, this last highway bill we passed 
doesn't even keep up with inflation. The statistics at that 
time were, according to the 2004 Federal Highway Administration 
report, said that just to improve our highways and bridges 
would take $118.9 billion, just to maintain the current 
condition and performance of highways and bridges would take 
$77.1 billion.
    The Commission's report comes out and even gives us more 
stark figures in terms of the challenges that we have before 
us. States like Ohio are looking at a $3.5 billion shortfall.
    I think we have to let the American people know that we are 
in deep trouble in terms of our highway infrastructure. We are 
going to be talking this year about what we are going to do 
about this. We are going to be getting into the budget again 
about what we are doing in appropriations. I think that you 
have a responsibility to speak up a little bit louder about 
what the needs are. We need look at some other things like what 
and Senator Isakson said--when I was Governor, have more of 
money not going to Washington, stay in State, and the states 
could utilize it more efficiently.
    Another point that the Commissioners brought up is to 
shorten the length it takes to do major highway projects. This 
report says it still takes 13 years to get it done. I fought 
like crazy to try and get 4(f) during the last highway bill, 
and we got a little bitty change in the provision.
    But I think we are going to need a lot more advocacy from 
you this year. It is your last shot. You won't be around. I 
hope you don't just hunker into a hole some place and just kind 
of ride out this Administration. You have a wonderful 
opportunity--you have been a State leader, a national leader--
to tell it as it is. The American people have to have someone 
tell it like it is.
    I don't even hear the Presidential candidates talking one 
iota about the infrastructure crisis that we have here in our 
Country. My State is a just-in-time State. We are really 
feeling it. We don't talk enough about the time on the road 
that people spend in traffic jams and the fuel that the use and 
the frustration and all the rest of it that is connected with 
it. But someone has to level with the people.
    The question I would like to ask you is that we have a 
shortfall. How are we going to pay for it this year, just 
keeping up with what we promised, which is not adequate?
    Ms. Peters. It is not, Senator. Please know that I agree, 
and agreed with my fellow commissioners that we do need 
substantially more investment. But what I am saying is, it has 
to be a different kind of investment, collected and used 
differently than we do today if we are going to be successful 
in doing that.
    Again, I think a way that we can attract that investment 
is, one, prioritize what we are spending today. Rough numbers, 
approximately 60 percent of what we collect today goes to roads 
and bridges, highways, roads and bridges. About 20 percent goes 
to transit, and the other 20 percent goes to a variety of 
programs. Overall, there are 108 programs in highways and 
transit that this money is sliced and diced into today and then 
sent back out to State and local governments to figure out how 
to use those categories.
    That tells me that we probably have 20 percent to play 
with. If we take efficiencies, like I spoke about on the 
Southern California roads, and are able to get 40 percent 
greater throughput, then we wouldn't need to perhaps build as 
much more. We certainly need to build more, but we wouldn't 
have to build as much, because we would be using the 
infrastructure more efficiently. Those are the ways, in the 
near term, that I think we need to approach this, sir.
    Senator Voinovich. When I was Governor, we set up our track 
proposal--we had tier one, tier two, tier three. We did the 
planning and all that you are supposed to do. But the fact of 
the matter is, right now, we are just having difficulty doing 
the tier one projects, because of the high cost of oil and the 
high cost of steel. We are falling behind.
    I agree there are things to look at. I asked our highway 
director recently about these sound barriers. He said it is a 
million dollars a mile. I thought to myself--some of the 
developers, build developments right next to a highway and then 
they come back to the departments of transportation in their 
respective States and say, put up a barrier. My attitude is, 
you shouldn't build there in the first place, and if you do, 
you should pay for the barrier, we ought not to pay for the 
barrier.
    We have the same thing in terms of highway interchanges. 
When I was Governor, I said, you want an interchange? You pay 
for it. In fact on Monday night I stayed at a motel in the 
Cincinnati area, in West Chester. It was unbelievable what had 
happened there. The development was fantastic, but you want to 
know what? They paid for it. I said to the developers, this is 
not going to be a windfall.
    I think there are a lot of things we can be doing, and I am 
asking you to speak out this year. It is your last shot at it, 
at least from the point you have. We need your help.
    Ms. Peters. I will do that, sir, thank you.
    Senator Boxer. Senator Voinovich, thank you. By the way, 
you are the Ranking Member today, because Senator Inhofe won't 
be coming.
    I wanted to mention, if we are fortunate enough to get 10 
colleagues, there is some business to take care of, S. 2146, a 
bill to authorize the Environmental Protection Agency to accept 
funds as part of a settlement for diesel emission reduction 
supplemental environmental projects. This bill has bipartisan 
support, and I congratulate Senators Carper, Voinovich and 
Clinton for their leadership on this issue. So if we are 
fortunate enough to get 10, we will move to that and try to get 
it done. If not, we will try to get it done as soon as 
possible.
    So in order of arrival, we will now go to Senator Vitter.
    Senator Vitter. Thank you, Madam Chair.
    Thank you, Madam Secretary, for your work and for the 
Commission's work. I just want to focus on two sub-issues right 
now. One is tolling. I think we have actually missed an 
important opportunity in the last highway bill, not doing more 
in that area and not providing more flexibility. I hope we 
don't miss it again in the next highway bill in 2009, or 
whenever that is going to be.
    I believe that if we take certain things off the table at 
the very beginning, which in my mind would be all existing 
capacity, I don't think it is defensible to start slapping 
tolls on existing routes and capacity. If we do that at the 
beginning, we can build solid consensus for a much greater use 
and flexibility of tolling.
    I would like your comments on that generally, No. 1. And 
No. 2, I would like to know if the Department will, if they 
could, develop this year a very specific, robust set of 
proposals in that area for us to look at for the next highway 
bill.
    Ms. Peters. Senator Vitter, to your last question, yes, we 
will. In fact, we are working on documents like that today. To 
Senator Carper's point, we know that this Committee has a big 
task before you. And even though I won't be here next year, we 
owe it to you, as the Senator said, to advocate for the best 
use of funds and a go-forward position.
    In terms of tolling, and whether or not we should toll 
existing capacity, I think you are right, there is a lot of 
opposition to that. I would only draw the line that if you 
substantially improve the existing capacity, make substantial 
improvements to it, have it work better, that perhaps that 
could be reconsidered.
    And please know that when I say tolling or pricing, it is 
instead of additional taxes, not additional taxes and that. 
Because I think we have a tremendous opportunity, as you said, 
to expand the use of pricing where it is appropriate to do so. 
That then frees up money that can be used in a variety of other 
places, in rural areas, where we have safety and access issues, 
it could be used, and in other areas where we need to improve 
interchanges to make them safer, things like that.
    Senator Vitter. Great. Again, I would very specifically ask 
you, encourage you to develop, again, a very specific and very 
aggressive and very robust set of proposals to give this 
Committee, at least among others, before the end of the year, 
as just a proposed chapter, if you will, of the next highway 
bill. And again, to both you and the Committee, I believe we 
should be rather broad in the front end of what we take off the 
table in order to build consensus of the use of tolling and 
other situations, building new routes and new capacity. That 
would be sort of my general formula.
    Second general issue, which I don't think we talk about 
nearly enough in these discussions, and these discussions are 
always 90 plus percent more money, more revenue, and that is 
needed. I am not disagreeing with that. But that is almost all 
the discussion, something I don't think we talk about nearly 
enough, is the cost that we have built into the system of 
building new capacity.
    The way Congress works, everybody has this good idea about 
a bike path this or mandating that. And it gets passed, and 
before you know it, there are 100 new mandates which add an 
enormous additional cost per mile of new highways. Everybody of 
all parties lauds the Eisenhower push to build the interState 
system. And I am one of those who lauds it, it was a great step 
forward for the Country.
    As we laud that, I think we should realize that if we were 
trying to make that happen today, under the current regulatory 
framework and under the current set of mandates and Federal 
law, it would never happen. It would never happen in 50 years, 
it would never happen. It couldn't happen under our current 
regulatory framework instead of mandates, which add price onto 
every mile of highway we construct.
    So I would like your comments about that, and specifically 
if you have or can develop, again, very specific, very robust 
recommendations in that category for us to consider for the 
next highway bill.
    Senator Boxer. Senator Vitter's time has expired. Feel free 
to answer the question, and then we will move on to Senator 
Alexander.
    Ms. Peters. I will be brief, Madam Chairman.
    Yes, I think you are right. Too much process today, tons of 
processes built into these highway projects, instead of what 
the outcome is, what the performance is, there are all kinds of 
things that you have to do in order to spend Federal money.
    In fact, when I was director at the Arizona Department of 
Transportation, we would take Federal money that might have 
otherwise gone to local governments and keep it and give them 
State money, because the requirements were just so egregious 
for them to have to comply with. So it is too much process that 
has been built up over many years. I think we should zero-base 
it and say, what should the Federal Government do and then turn 
everything else, including the money that goes with it, back to 
the States.
    Senator Vitter. Thank you.
    Senator Boxer. Senator Alexander.
    Senator Alexander. Thank you, Madam Chairman, Madam 
Secretary.
    I have a comment and then a question. My comment is this. 
We have a rare opportunity here. We have a Committee that is, 
in a bipartisan way, interested in taking a big look down the 
road about what our Country's needs are. We have members of 
this Committee who have been either senior in the Congress for 
a long time, who have been Governors of their States, who have 
been mayors in their States. We know the value of having 
adequate infrastructure.
    I still vividly remember how recruiting automobile plants 
to Tennessee, I discovered that locating their suppliers 
depended almost exclusively on having a good four-lane highway 
system. So we had three big road programs and doubled our gas 
tax, and everybody in the State was for that, because it raised 
our family incomes.
    Here is my comment. We never talked about how to pay the 
bill until we talked about where we wanted to go. In fact, when 
I was Governor, I would now allow discussion about how to pay 
the bill until we had an idea about the plan. What kind of 
system do we want? Then paying the bill is relatively easy. We 
could figure out, there are many options for paying the bill. 
Senator Vitter said that too often we talk about more money. I 
don't think we should talk about money at all, to start with. I 
think we should talk about what kind of Country do we want to 
have, what are our needs, what do we need to do. Then we can 
have an argument, if we need to have one, about how much we can 
afford of that big plan and where the money comes from.
    So I would hope that we would take advantage of this rare 
opportunity we have in the Senate to dream big and think 25 
years ahead and your leadership and the Commission's report and 
this Committee, the way it is currently composed, provides a 
real opportunity for that.
    Now, let me go to my question, if I may. This is about a 
specific idea. In Tennessee, as in most places, there is 
nothing more irritating than traffic jams. I have heard you say 
that, other than deaths on the highway, congestion is the 
biggest challenge. And the head of the National Transportation 
Safety Board said, if I heard him right, that sometimes up to 
half of highway congestion is caused by the inefficient use of 
highways.
    So it makes me wonder, if we have fuel efficiency standards 
for cars, why don't we have highway efficiency standards for 
States? If a State wants to persist in having road construction 
in the middle of rush hour, creating long lines and a lot of 
fumes and inefficient use of roads, why don't have a highway 
efficiency standard published every year by your Department 
that rates States from top to bottom, 1 to 50, and make it an 
issue in the Governor's race?
    I believe if I ran for Governor, and we were 50th in 
highway efficiency, I would stand out by the traffic jam in 
Nashville and Chattanooga and Memphis and Knoxville and say, 
you know, we could fix that. Fifty percent, the idea that as 
much as 50 percent of the congestion might be caused by the 
inefficient use of highways is a staggering amount of money.
    We have discussed this before, and I have asked your 
Department to suggest to me some of the factors that might go 
into a highway efficiency standard. I wondered if you would 
want to say anything about that idea and whether it might be 
useful. It might embarrass some Governors. It might also unclog 
some highways and it might create a lot less commute time for 
people driving to work in California or Atlanta or Nashville or 
New Orleans or any other place in this Country.
    Ms. Peters. Senator, I think you are exactly right. We 
could get much efficient use of our system than we have today. 
In fact, the figure I gave earlier to the Senate was, we get 40 
percent greater throughput when we use pricing.
    Here is another little known fact. The household travel 
survey that is conducted by U.S. DOT and Federal Highway 
Administration evaluates who is actually out on the road during 
rush periods of time. We can't say rush hour, because it is not 
an hour any more, it is big, long periods of time. Fifty 
percent of those who are out using the roadways during that 
period of time are not commuting to work. In fact, 20 percent 
of them are retired, which would give you the assumption that 
they could perhaps schedule their trip at a different time. But 
because there isn't any price differential in their doing so, 
they don't do it.
    So I think absolutely, performance standards need to be 
established and we need to tell the public, this is what we are 
doing with the money and with the infrastructure that we have 
responsibility for, this is how we are serving for.
    I will defer to my former colleague, Deb Miller, in terms 
of comparing one State to another. She might be able to speak 
to that a little better than I can.
    Senator Alexander. We Governors know how to do that. We 
always go to conferences, and if Governor Carper were way ahead 
of me, or Governor Voinovich, I could be sure I would have to 
answer for it by the time I got back home.
    Thank you.
    Senator Boxer. Thank you.
    I understand Senator Whitehouse doesn't have a statement. 
How about Senator Warner? Do you have a statement or questions 
for Secretary Peters?
    Senator Warner. I would just like to observe, and thank you 
very much for the courtesies that you have extended to the 
State of Virginia recently in our deliberations on the 
essential need to establish a system by which rail services can 
be afforded Virginians and a lot of visitors who come to the 
Nation's capital and a lot of the Members of the Congress who 
have to fight their way to and from the corridors to Dulles 
Airport.
    You very promptly recognized the need for our Governor to 
re-write and prepare a case. I think he has done an able job. I 
visited with him the day before yesterday on Richmond on this 
subject. It is my hope that as soon as the staffs have sort of 
defined the parameters of where these issues might be that we 
could sit down with you, the Governor and several Members of 
the congressional delegation and once again, do our very best 
to make this system workable from a technological standpoint, a 
financial standpoint and an environmental standpoint.
    I just want to commend you on the manner in which you have 
handled that. I do hope we can sort of do it quietly among 
ourselves until such time as a decision, whatever that is, has 
to be made, and then we go public with that. Beforehand, I 
think we had best just be quietly working together. I thank the 
Secretary.
    I would want to ask the Secretary one question, is that 
appropriate?
    Senator Boxer. Absolutely.
    Senator Warner. Obviously, this Committee, under the 
leadership of our distinguished Chairman, is working on the 
greenhouse gas emission issue. What are the steps that you feel 
overall policies should be followed by our Federal Government 
in working with our States in the combined efforts to reduce 
greenhouse emissions?
    Ms. Peters. Senator, I would be pleased to answer that 
question, and thank you, and thank the Chairman for your 
leadership on this issue as well.
    I think there are several things, and I will speak mostly 
to what we do within the transportation world. Substantially 
increasing fuel efficiency standards is one. Thanks to this 
august body and many others in Congress, that has been done, 
and we are in the process of implementing that now. Alternative 
and renewable fuels are very important, especially fuels that 
burn cleaner than the fossil-based fuels that we use today I 
think are going to be very important to us in the future. 
Certainly part of this also is lessening our dependence on 
foreign oil.
    But one factor that doesn't always get talked about that 
has an incredible opportunity to help us with greenhouse gas 
emissions is fighting congestion. In fact, I would refer to 
Mayor Bloomberg in New York City, who has put a very ambitious 
proposal out to substantially reduce congestion in the lower 
Manhattan area. He and we are looking at how to quantify the 
savings in greenhouse gases and the savings that will accrue to 
that city as part of that. We believe it can be a tremendous 
effect and something that we can do very quickly when we can 
get these mechanisms put into place.
    So Senator, I think there are a number of things that we at 
U.S. DOT can do to help with this issue. I promise you that we 
are working very hard on those.
    Senator Warner. Good. Senator Lieberman and I introduced 
legislation which has passed this Committee and will hopefully 
be considered by the full Senate in the spring. If there are 
thoughts that you have on this, we would appreciate examining 
them. We are quite open to suggestions, most especially from 
our colleagues, a very diverse group but equally important, to 
get a clear understanding of just where the current 
Administration is on this issue.
    I judge from what you say that you feel that there has been 
a significant or sufficient amount of scientific data to 
indicate there are abnormalities in our weather patterns today 
which can be attributed to man-made sources. Do you have that 
premise?
    Ms. Peters. Senator, yes, I do.
    Senator Warner. Good. I thank the distinguished witness.
    Ms. Peters. And Senator, thank you again for your 
leadership with Dulles.
    Senator Warner. Thank you.
    Senator Boxer. OK, Senators, we have nine of us. I hope, 
and I know Senator Sanders has to go to another hearing. So if 
we don't have someone in the next 2 minutes, we lose, it 
becomes one of these Three Stooges things where one walks in 
and one walks out.
    Senator Warner. Senator Inhofe is two stories below us in 
the Armed Services Committee, and he could be asked to come up.
    Senator Boxer. Hang tight 2 minutes. We very much 
appreciate that.
    Let me just say, because we are going to move ahead to the 
panel and not have a second round with you, Madam 
Administrator, but this is the thing. I feel compelled just to 
set the record straight on a couple of points before we move 
on. The impression that one gets when one listens to you is 
that the Federal Government is lifting a really heavy load when 
it comes to transportation infrastructure.
    The fact is, we are doing 40 percent. And the States and 
the cities and everybody else, and the counties, are doing the 
rest. We are spending our contribution, $40 billion a year.
    Now, $40 billion a year from the Federal Government, that 
is 4 months in Iraq. So I think we need to think about these 
comparisons when we, woe is me, we are spending so much. We 
seem to have an open checkbook, I would agree with Senator 
Voinovich, for other countries at this point, but not for the 
taxpayers.
    The other point that I would make is to address Senator 
Alexander's impassioned point about why are we talking about 
how much money, we really need to say what we need. I 
absolutely agree. However, the Commission did both. The 
Commission didn't just look at how much money we need, the 
Commission looked at the need. And they said, we need goods 
movement, we need passenger rail, we need freight rail. We need 
to repair the current system, we have to address congestion. In 
order to do that, they honestly said, we have to go up to, what 
is it, $225 billion a year from all sources, all sources.
    The reason I make the point is that, again, I don't want 
people out there to think the Federal Government is doing most 
of the lifting when it comes to the infrastructure. I think 
most people think we do, but we don't. So if it is a Federal 
priority, and some of us think it is, in a great Nation and a 
growing Nation and the greatest economy, we pray, for all 
times, then we have to meet the need.
    I would just close by saying that I want to associate 
myself with the remarks of Senator Voinovich. Because when he 
said, please be brave, please be strong, please help us here, I 
think the point is that your staff is the one who developed all 
these numbers. And you mentioned Mayor Bloomberg. Well, Mayor 
Bloomberg has teamed up with my Governor, Governor 
Schwarzenegger, he has teamed up with Governor Rendell, that is 
an Independent, a Republican and a Democrat, and they have 
stated very clearly, let's not put our heads in the sand, we 
need more resources.
    The last point I would make, I think it is depressing, 
frankly, when we have testimony. You are a very upbeat person, 
you do a wonderful job, you have saved California on many 
occasions when we have had tragic things happen on our 
freeways. I will always be grateful to you.
    But it is depressing not to have a forward-looking vision 
of where this Country is going. It just is. So I am hopeful 
that we can work with you, maybe get some of your ideas about 
how we can truly have that can-do spirit about the greatest 
Country in the world. I think the people want it, the people 
are responding to it with this Presidential election on all 
fronts, both sides of the aisle. I think we should reflect it, 
rather than sort of the depressing testimony that, woe is us 
and we are doing too much and we can't do any more.
    That is how I feel about it. If we could have the panel 
come up now and this time, and we thank you so much, Secretary 
Peters.
    The Honorable Debra Miller; Janet Kavinoky; Gregory Cohen; 
JayEtta Hecker. And I know, I could tell by looking at Senator 
Sanders' face that he is really concerned. So he is going to 
have to leave us.
    Senator Whitehouse. Madam Chair, Senator Sanders and I both 
have to be in the Budget hearing. The Secretary of the Treasury 
is there, we are up and we have to go, very soon.
    Senator Boxer. Where are they? One minute. If they are not 
here in 1 minute, I think you should leave and that is it. You 
can't do this, 1 minute, 1 minute. One minute on the clock, you 
should do your work, because we have a budget problem.
    OK. Debra Miller, we welcome you. We will start with you. 
You are the Secretary of the Kansas Department of 
Transportation. You are speaking on behalf of the American 
Association of State Highway and Transportation Officials. We 
will be very interested in your testimony, and please proceed. 
Five minutes is your time.
    By the way, we may have a vote soon, that is why I am 
trying to move forward.

STATEMENT OF HON. DEBRA L. MILLER, SECRETARY, KANSAS DEPARTMENT 
                       OF TRANSPORTATION

    Ms. Miller. Thank you very much. I am Deb Miller, I am 
Secretary of the Kansas Department of Transportation and I am 
speaking on behalf of the American Association of State Highway 
and Transportation Officials.
    AASHTO commends this Committee for establishing the 
Commission and we are proud that one of our own, my colleague, 
Frank Busalacci, Secretary of the Wisconsin Department of 
Transportation, served on the Commission. Through the testimony 
of our members and a series of reports, AASHTO provided 
substantial information to the Commission.
    In May 2008, we convened transportation leaders from around 
the Nation in a Transportation Vision for the 21st Century 
summit. The resulting vision document was co-signed by 21 
national transportation organizations. Much of that input has 
been reflected in the Commission's report. We believe that the 
Commission got the big ideas right, including the need for 
fundamental reform of the Federal transportation program, the 
need for significant additional investment, a strong Federal 
role and a shared funding responsibility by Federal, State and 
local governments, the need for a multi-modal approach with 
greater emphasis on transit and inter-city passenger rail, an 
increase in Federal revenues, be it through fuel taxes or other 
means, and the need to transition to alternative sources 20 
years from now. Greater use of tolls and public-private 
ventures to supplement revenues at the State and local levels, 
systematic planning to guide investment and a performance-based 
program, accountable for results, and investments focused on 
matters of genuine national interest.
    We believe the Commission was accurate in the assessment 
that the U.S. needs to invest $225 billion per year from now 
until 2050 to meet national needs. Today we are investing less 
than 40 percent of that amount. We also believe they were 
correct in their assessment that the only way to increase 
funding to the levels needed is for all levels of government to 
continue to fund their share. State and local governments, even 
with the aid of private partnerships, will not be able to meet 
national investment needs. We need a strong Federal partner. We 
need a strong Federal partner not just to meet the investment 
needs, but to craft the national vision necessary to meet the 
continuing growth of this Nation, the explosion of intermodal 
trade and the expansion of the global economy.
    The Commission called for reform of the Federal program to 
ensure that it is performance-based, accountable and focused on 
issues of true significance. They called for restructuring the 
program to address 10 priorities: preservation, freight, 
metropolitan congestion, safety, connecting with rural America, 
inter-city passenger rail, environment, energy, Federal lands 
and research. We want to work with Congress to make sure that 
these reforms are implemented in ways that can work at the 
State level and also to craft programmatic solutions that meet 
the needs of all States, both large and small, rural and urban.
    We agree with the Commission that it takes too long to 
deliver transportation projects and that reforms must be 
instituted to speed project delivery. When Congress first 
proposed the idea of creating the national Commission, one of 
its fundamental question was whether we could continue to rely 
on the Federal fuel tax as the main source of revenue to 
support the highway trust fund.
    We find it instructive that the Commission determined that 
the fuel tax will continue to be a viable source of funding, 
but that a transition to an alternative, such as a VMT tax, 
will be needed by the year 2025. It will be up to Congress to 
determine how to sustain the solvency of the Highway Trust Fund 
and how to increase future revenues, so that the Federal share 
of surface transportation funding can be increased to the 
levels needed.
    We are depending on the Senate and House to find ways to 
avert the immediate funding crisis pending this year, so States 
receive highway and transit fundings at the levels guaranteed 
in SAFETEA-LU. When these programs come up for reauthorization 
in 2009, unless Congress finds ways to sustain highway and 
transit funding, States will face two equally grim options: 
reduce their highway and transit programs by the amount of the 
Federal cutback, or sustain their program by raising State 
taxes to make up the difference.
    The final aspect of the Commission report that we find 
significant is its call to action. They call on Congress first 
to create and sustain the preeminent surface transportation 
system in the world; second, to bring about fundamental reform 
to restore public confidence in the Federal program; and third, 
to increase transportation investment to the levels needed to 
keep the U.S. competitive in the global economy and to assure a 
bright future for our children and grandchildren. Those are 
recommendations with which we at AASHTO strongly endorse.
    [The prepared statement of Ms. Miller follows:]
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    Senator Boxer. Thank you so much. Your timing is perfect.
    By the way, that was such straightforward testimony. It was 
very clear. I thank you very much for it.
    So just stay where you are, thank you very much for being 
here, thank you, Ben, for coming too, and thank you, John, for 
coming. The hearing is in recess for a moment.
    [Whereupon, at 10:55 a.m., the Committee proceeded to other 
business.]
    Senator Boxer. Now we will go back to our hearing. We are 
very happy to welcome Janet Kavinoky, Director, Transportation 
Infrastructure, U.S. Chamber of Commerce. We welcome you.

   STATEMENT OF JANET F. KAVINOKY, DIRECTOR, TRANSPORTATION 
            INFRASTRUCTURE, U.S. CHAMBER OF COMMERCE

    Ms. Kavinoky. Thank you, Madam Chairman and distinguished 
members of the Committee.
    We appreciate the opportunity to testify on the report of 
the National Surface Transportation Policy and Revenue Study 
Commission and the policy changes and investments required to 
meet the needs of our Nation's transportation system. My name 
is Janet Kavinoky, and I am the Director of Transportation 
Infrastructure at the U.S. Chamber of Commerce and the 
Executive Director of the Americans for Transportation Mobility 
Coalition.
    Over the past several months, the Nation has seen abundant 
evidence that America's infrastructure is not only showing its 
age, but showing that it lacks the capacity to handle the 
volume of people and goods moving today. From exploding steam 
pipes under New York streets to record-level flight delays in 
the skies across the Country, it is evident that now is the 
time to move on a robust, thoughtful and comprehensive plan to 
build, maintain and fund a world-class 21st century 
infrastructure.
    We cannot treat infrastructure like other problems or 
programs where you can wait until the very last minute and then 
write a big check. Because infrastructure projects require 
foresight and years of careful planning. As the Commission 
report says, the time is now. There can be no more delay.
    What is at stake is simple and stark. If we fail to address 
our challenges, we will lose jobs and industries to other 
nations. If we fail to act, we will pollute our air and destroy 
the free and mobile way of life we cherish. Ultimately, we will 
see more senseless deaths on our bridges and roads, not to 
mention our rails and waterways.
    While the collapse of the I-35 West bridge in Minneapolis 
shone a spotlight on the State of our Nation's bridges, it is 
important to recognize that we have a much larger 
infrastructure problem in this Country. Fundamentally, our 
current approach to delivering transportation is not set up for 
today's robust economy or the economy of the future. The 
Chamber agrees with Senator Inhofe's observation made at the 
hearing last week that both the current model of stovepipe 
modal decisions and the current program structure are outdated. 
It is time to address these issues and create a new era in 
transportation.
    We wholeheartedly agree with the Commission that continued 
under-investment and business as usual transportation policies 
and programs will have a detrimental impact on the ability of 
the Untied States to compete in the world economy and on the 
everyday lives of Americans. Like the Commission's majority 
report, the Chamber believes that the next era in surface 
transportation requires a multi-modal and intermodal vision and 
emphasizes the important role of the Federal Government.
    On the issue of the Federal role, although every level of 
government must step up to the plate, the Federal Government 
must bear a significant part of the responsibility to ensure 
that national needs are met, legacy assets are maintained and 
improved to guarantee nationwide connectivity, and 
infrastructure investment is aligned with the needs that arise 
from the global economy, trade policies and the flow of 
interState commerce. The Chamber is pleased to see that the 
Commission calls for a transportation system that explicitly 
values freight movements. On a typical day, about 43 million 
tons of goods, valued at $29 billion, move nearly 12 billion 
ton miles on the Nation's interconnected transportation 
network. According to the Federal Highway Administration, 
without new strategies to increase capacity, congestion may 
impose an unacceptably high cost on the Nation's economy and 
productivity.
    We also agree with the Commission that metropolitan 
mobility, congestion relief and small city and rural 
connectivity deserve national focus and resources. Increasing 
congestion imposes additional costs on the work force and 
employers alike. I am reminded constantly by State and local 
chambers of commerce that their communities need transportation 
choices and those options are a valued aspect of economic 
development strategies.
    Programmatically, the Commission mentions another important 
priority, and that is speeding project delivery. As a Nation, 
we have allowed governments to pile on complex and overlapping 
regulations. It takes years, even decades, to bring projects 
online. Red tape and lawsuits can grind the most common sense 
improvements to a grinding halt. We concur with the Commission 
that it is possible and indeed, essential to speed project 
delivery while adequately addressing environmental and 
community impacts. This must be a top priority in the next 
authorization.
    Finally, when it comes to funding and financing, every 
option must be considered to address the enormous problems of 
the aging transportation infrastructure. We agree with you, 
Madam Chairman, and your assessment at this Committee hearing 
last week that continuing the current programs art their 
current funding levels is not sustainable, will not fix our 
Nation's crumbling infrastructure and will not meet the needs 
of our growing economy. Although it is clear that chronic 
under-investment is a major contributing factor to the problems 
across the modes of transportation, we must also address the 
mis-use or diversion of funding away from its intended uses, 
the lack of resource prioritization and poor comprehensive 
planning that marks current Federal transportation programs.
    As we all prepare for SAFETEA-LU reauthorization, the 
Chamber encourages Congress to examine ways to spend 
infrastructure dollars more wisely. The public must trust and 
have confidence that transportation programs will deliver real 
solutions to their problems. Otherwise, they will not support 
increased investment.
    Before we get to SAFETEA-LU reauthorization, Congress has 
another important issue to address: the Highway Trust Fund.
    Senator Boxer. Can you wrap up?
    Ms. Kavinoky. Yes, ma'am, I can.
    The Highway Trust Fund shortfall, and we commend Senator 
Baucus on his leadership in this issue.
    So Madam Chairman, the question facing us is this: can we 
do this and will do it together? The Chamber is ready to do so, 
and we are ready to help lead. Thank you.
    [The prepared statement of Ms. Kavinoky follows:]
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    Senator Boxer. We are very excited with your testimony. 
Thank you very much.
    Our next speaker is Gregory M. Cohen, President and CEO, 
American Highway Users Alliance.

  STATEMENT OF GREGORY M. COHEN, PRESIDENT AND CEO, AMERICAN 
                     HIGHWAY USERS ALLIANCE

    Mr. Cohen. Thank you, Chairman Boxer.
    Chairman Boxer, members of the Committee, I am honored to 
have this opportunity to present testimony and the views of the 
American Highway Users Alliance on the National Surface 
Transportation Policy and Revenue Commission. The Highway Users 
is am umbrella group representing 270 national and State 
associations and businesses of all sizes, including AAA clubs, 
bus and truck companies, motorcyclists, recreational vehicle 
users and a very diverse range of companies whose bottom lines 
depend on a safe, efficient and reliable network of highways. 
Our members represent millions of highway users throughout the 
country, and we serve as their united voice in Washington for 
better roads and fair taxation.
    For over 75 years, the Highway Users has been an outspoken 
stakeholder on every major Federal highway and transportation 
bill. Highway Users applauds the Commission for its 
comprehensive report, Transportation Tomorrow, and we thank 
this Committee for authorizing their work. While we do not 
endorse every single one of their recommendations, we believe 
their report provides a great starting point for reforming the 
current highway and transit programs, to craft a fundamentally 
different, better transportation bill than the previous TEA 
bills.
    The Commissioners were united that the highway and transit 
programs should not be reauthorized in their current form. The 
Highway Users agrees with this fundamental call for bold 
change, and we are pleased that the Commission accepted so many 
of the recommendations we made.
    The Highway Users reviewed the recommendations of both the 
majority and minority of commissioners. Fundamentally, our 
views are much more closely aligned with that of the majority. 
A critical distinction between the two views is the role of the 
Federal Government. We agree that the Congress should authorize 
a strong, focused Federal program designed to meet national 
safety and mobility objectives. It is our view that a shrinking 
Federal role would seriously damage the integrity of the 
national highway system, create dangerous imbalances between 
States over bridge quality, road quality and safety, and 
severely impact the flow of interState commerce.
    Another major difference between the majority and minority 
views is the role of tolling and public-private partnerships. 
Again, our views are closer to those of the majority. We 
believe that tolling and PPPs have a role to play in the 
construction of new lanes, new roads and bridges. We would 
welcome private construction of new roads. We also would 
support the construction of new toll express lanes along 
existing toll-free interState lanes, or the conversion of 
under-utilized HOV lanes to hot lanes. However, consumer 
protections are critical to ensure that tolling and PPPs do not 
create barriers to commerce or safety problems. We urge the 
Committee to maintain its longstanding opposition to tolling 
existing toll-free interState lanes.
    One of the areas of unanimity among commissioners was the 
call for speeding up project deliveries. Every 10 years a 
project is delayed, the cost doubles. That doesn't include the 
social costs of congestion and safety, which would rack up into 
the billions for a major congestion relief project. We endorse 
the recommendations of the Commission to speed project delivery 
and also recommend that the five-State pilot program you 
authorized in SAFETEA-LU be authorized for all States. I know 
that California and Oklahoma are among those States that are 
currently participating in the five-State pilot program.
    The Commission identified 108 Federal programs funded by 
the Department of Transportation to combine into 10 new 
programs. Although we don't necessarily endorse the 10 specific 
programs that the Commission proposed, we agree that a smaller 
number of performance-based, outcome-driven programs are 
needed. We believe the lack of focus and a lack of national 
priorities greatly reduces the public support for increasing 
funding for transportation programs. We believe that this 
Committee can fix that.
    The Highway Users is actually surprised that one of the 10 
programs is a `` `stove-piped'' program, because they made 
their other program recommendations mode neutral. That ``stove-
piped'' proposal is the inter-city rail program. We believe 
that such a proposal eliminates competition between rail and 
cost-effective bus rapid transit without a compelling case for 
doing so, particularly when highway users finance the vast 
majority of the surface transportation program. It is simply 
unfair to ban highway projects, particularly highway-based 
transit projects, from competing with rail. We would object to 
the creation of a rail-only ``stove-piped'' inter-city 
passenger program.
    Highway Users supports the Commission's recommendations to 
develop national performance standards for competing States and 
metropolitan areas. Such a program could encourage innovation 
and safety, congestion relief, freight mobility, pavement and 
bridge quality and project cost savings. For example, States 
that are successful in reducing their traffic fatalities should 
receive a bonus in funding. They are on the right path and they 
should be rewarded.
    For congestion relief and freight mobility, we will 
officially propose a performance-based congestion relief 
program later this year that targets the national highway 
system. We hope that you take it into consideration.
    Senator Boxer. Can you finish it up now?
    Mr. Cohen. On funding, again, as the Chamber did, we 
endorse Senators Baucus and Grassley's highway trust fund fix. 
We also support increasing fuel taxes, provided that the 
program is reformed. We also strongly support the addition of 
new non-highway user fees to diversify the revenue sources into 
the program. And in the long term, we are studying the VMT 
proposal. We have similar concerns as you do, but we are also 
open to looking at that.
    In conclusion, the Highway Users really looks forward to 
working with you on the 2009 bill. I think there is a lot more 
work to be done than there was for the SAFETEA-LU bill, because 
fundamentally we need a major restructuring. The 2009 bill 
needs to be reauthorized on time, because the Highway Trust 
Fund is out of money. The current program cannot be sustained 
past 2009 unless reauthorization is done on time.
    Thank you again.
    [The prepared statement of Mr. Cohen follows:]
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    Senator Boxer. Thank you, sir. Thank you very much.
    And last but not least is JayEtta Hecker, Director, 
Physical Infrastructure Issues, U.S. Government Accountability 
Office. Welcome.

STATEMENT OF JAYETTA HECKER, DIRECTOR, PHYSICAL INFRASTRUCTURE 
         ISSUES, U.S. GOVERNMENT ACCOUNTABILITY OFFICE

    Ms. Hecker. Thank you, Madam Chair, members of the 
Committee. I am very honored to be here.
    As you know, we do our work for you. In fact, I am speaking 
on a body of work that we have completed for this Committee, 
for the House and some ongoing work that we have as well. This 
is truly a critical juncture. We think there are severe 
problems with the performance of the system, the performance of 
the program, not only in congestion, but it is unreliable, it 
is affecting business, very severe economic consequences. And 
as you know, in your State, environmental and health 
consequences that are indeed very real.
    So we have some very significant economic problems, 
performance problems, quality of life with infrastructure in 
this Country. And solutions are complicated, complicated by the 
fact that this is such a broad area. There are so many sectors 
involved, private sectors, public sectors, all levels of 
government with different ownership and different interests.
    Another severe complication that has never been effectively 
addressed in the past is transportation is inextricably linked 
with environmental issues, with energy issues and aviation 
issues. We really haven't made those links very effectively. 
The next bill is an important opportunity and challenge to 
really get that nexus between transportation and environment, 
in particular that this Committee is uniquely in a position to 
do.
    Another factor that GAO often points to is the fiscal 
crisis. The Federal Government is running out of money. Any 
time anyone talks about, well, this should be a general fund 
activity, they are saying, this should be borrowed, we should 
borrow the money for this because there is no money in the 
general fund. So there is a very high standard that has to be 
applied.
    My remarks today will focus on two things. First, some 
principles that we have developed which we believe should 
assist the Congress in reviewing any of the reform, 
restructuring or reauthorization proposals. We have tried to 
build a foundation to help focus, how complete is this, how 
sustainable is it.
    Then I have some preliminary observations on the 
Commission's recommendations vis-a-vis these principles which 
basically serve as criteria to look at various proposals. The 
principles are painfully simple. But they do not match the 
current program we have.
    The first principle is that there be clear national 
interests and a clear Federal role; we have had not had that 
since the interState. There are currently 118 programs. It is 
an agglomeration, it is more and more and more. The way the 
money moves out and the way it is disbursed, there is no real 
interest, there is no real link to what we spend $30 billion to 
$40 billion on a year and the result in transportation. There 
is no link.
    So the first is to have an idea of what outcome we want, 
what the national interest is, what the Federal role is. The 
second principle is also painfully simple: build in performance 
and accountability for results in those desired areas. And link 
it to the funding decision, so it is not just nice, prefatory 
language, which the Congress often has at the beginning of a 
bill, but the linkage to the actual programs.
    The final principle one is fiscal sustainability. The 
current program is not sustainable. We need to focus on 
treating all the resources as scarce. It is imperative that the 
national public benefits of any Federal investment be 
optimized. We have to make the best use of the dollars, get the 
best return on the investment. No matter how much you are able 
to increase it, it is still scarce and we need to have that 
kind of discipline and fiscal sustainability.
    So the principles are identifying clear national interests, 
requiring performance and accountability and ensuring a 
fiscally sustainable system. The preliminary comments on the 
Commission, on the national interest, they identify areas, as 
many people have said, they have very specific areas. They 
recommend reorganizing transportation programs around those.
    We raise the question, though, and have concern that the 
underlying organization of all the programs is 80/20 money. If 
you are focusing on where there is a national interest, 
presumably the money that the Federal Government puts in aligns 
with the level of Federal national benefits, not local 
benefits, not private benefits, not railroad benefits, not 
local community choices of what they want versus a national 
benefit.
    So we are troubled by not only the continuation, but the 
enormous expansion of 80/20 funding for areas where States now 
spend everything. If States find it in their interest, like 
California on rail, that rail is really important to us, why 
would we substitute 80 percent Federal funding? It just 
completely substitutes for local choices, local decisions, 
local preferences.
    On performance------
    Senator Boxer. I'm going to have to ask you, you are so 
good, but we need to wrap up. I am fearful we are going to get 
a vote shortly.
    Ms. Hecker. Performance, lots of emphasis on performance, 
but no link to funding. We are very concerned about that, and 
need to learn more about it. Because the commitment is there, 
but we don't see the link. It is basically a need-based system 
and the cost to complete.
    The issue of sustainability, we think it is pretty unclear 
whether the Commission's recommendations are fiscally 
sustainable, target the best use, really will introduce a 
return on investment approach. Basically, our core focus has 
been for a comprehensive reexamination of whatever the Federal 
Government does, how it does it, and we are not sure that this 
Commission report really represents that zero-based review that 
is so sorely needed.
    [The prepared statement of Ms. Hecker follows:]
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    Senator Boxer. Thank you very much.
    Let me just thank the panel. I think your point about a 
connection between the environment and our infrastructure is 
key. This is the Environment and Public Works Committee. It is 
not the Environment or Public Works Committee. So I think it is 
key here, and as we see the need to clean our air and move 
goods and reduce congestion, it is really compatible, they are 
compatible goals.
    I don't want to get into too much detail, I just want to 
ask in general to the three that represent various 
organizations, I have a good feeling about this Committee's 
work when it comes to infrastructure. We proved ourselves on 
the water infrastructure. With a lot of your help out there, we 
in this Committee were able to cross over party lines, we 
worked very well together. Senator Inhofe and I were joined at 
the hip on this particular bill, the WRDA bill. We were able to 
successfully not only get it through the Committee and through 
the conference and through the Senate and all the rest, but we 
got it, we had to override a veto. That was not easy for my 
colleagues on the other side, and I have great respect for 
them.
    But we, I think, on this Committee, when it comes to 
looking forward, we want this Country to be as great as she can 
be, and you can't do that without an infrastructure that is 
really sufficient to our needs. So I guess my question to the 
three of you, without putting you out on a limb, but if we do 
produce such a bill, are we going to be working, my goal, as 
Chairman of the full Committee, and I know, I have spoken to 
Senator Isakson about this and Senator Baucus as well, we want 
to see where we can come together on principles.
    For example, I have a sense we are all going to want to 
reform the way we have all these 108 different categories. The 
Commission suggested 12. Maybe we decide to do 10, maybe we 
decide to do 20. But I think that is an example of where maybe 
we have some agreement on the goals. If we come to such an 
agreement and we are able to be united, I would hope that your 
organizations could really get behind us. Because we are going 
to need to let the American people know what it is we are 
trying to do and what our vision is.
    So I guess my question to the three of you is this: you 
have been very passionate about your support for a lot of what 
the Commission said, not all, certainly. But are you willing to 
get out there and be our voices if we are able to come to some 
agreement and you approve of this bill? Would you invest time 
and energy in helping us get it through?
    Ms. Miller. Senator, I would be happy to start first. I 
would say I have been very impressed today by the questions and 
the comments made by the Committee. My own observation in the 
Sate of Kansas is that transportation tends to be a very non-
partisan issue. There is a lot of strong support around it. I 
think I see those same issues playing out before this 
Committee.
    On behalf of AASHTO, I believe I can say absolutely, 
categorically we would love to work with this Committee and 
would be enthusiastic voices throughout our States and working 
with our local governments. I think without question, all State 
DOTs have very closing working relationships, not only with 
their MPOs but with their city and county government 
structures.
    Senator Boxer. Good. Janet?
    Ms. Kavinoky. Madam Chairman, the Chamber is investing 
resources and significant amounts of our own overall agenda 
into infrastructure investment. As my written testimony noted, 
we have launched a multi-million dollar initiative to bring 
attention to the needs of America's infrastructure. So we are 
with you all the way.
    Senator Boxer. That is wonderful. Gregory?
    Mr. Cohen. The Highway Users, as I mentioned earlier, 
represents 270 different associations and businesses that 
represent millions of highway users. We will put the full force 
of our grass roots to support you in reforming and increasing 
the size of this program.
    Senator Boxer. I am very happy about that. My only other 
question is this. This vehicle miles traveled that Senator 
Isakson is so interested in, and I am very interested in, but I 
don't understand why it is such a mystery as to how you figure 
it out. When I go to register my vehicle every year, if there 
is a line in it and it says, last year, certify how many miles 
did you travel, and that becomes something you have to fill 
out, and you just say, for my little Prius, I went 15,000 miles 
last year. And based on that, I pay this fee that is turned 
over to whichever agency gets it.
    I don't know why we have to come up with this thing about 
spying on people and putting GPSs in their cars and spending 
millions of dollars to figure this out. I guess what I want to 
ask you, and I would ask all of you, am I missing something 
here? Would that not be a way to figure out how many vehicle 
miles each car or truck or van travels? Am I missing something 
here?
    Ms. Hecker. We have looked at the Oregon study, we have 
looked at other studies around the world. The key is that it is 
to make the actual cost of the infrastructure you are using 
more apparent to you. So it wouldn't work to be an annual bill 
that you say, well, I had this many miles last year, this many 
this year. It is which road you are using, which time of day.
    The thing is that infrastructure has congestion costs. 
Everyone who uses the road imposes congestion. And the 
potential of new pricing and use time of day pricing is that it 
will tell you, as we heard the Secretary say, if there is 
somebody who has a lot of discretion but perceives that it is 
just as free to use the road at 6 p.m. as it is at 3 p.m., then 
it creates excess demand. So the principle of VMT is getting it 
aligned to the specific road and the time of day.
    Senator Boxer. Well, that really turns me off. I mean, 
people don't ask me when I pay my gas tax, they don't say, 
well, if you don't use the road on a certain time, then you can 
pay a smaller gas tax. This is out--I just want us to get off 
this as fast as we can. It really disturbs me to think that 
Government would know, first of all, the whole idea, if you 
want to know how many people are using a road at a certain time 
of day, you just set those little strips and you can find out. 
Now, you don't know who, you don't want to track that.
    But the whole notion of knowing all this about people is 
very concerning to me, just as Chairman. So again, I am 
bringing it up because I hope we don't have to have this 
battle. But I think Senator Inhofe and I, I think we agree on 
this. But he is not here. But I just don't know how other 
people feel, but I just think it is a non-starter.
    So what happens, you have to put a quarter in the meter 
every time you go at 3 o'clock in the afternoon?
    Ms. Hecker. No, it is like an E-Z pass. So it is just 
automatically deducted.
    Senator Boxer. Oh, wonderful.
    [Laughter.]
    Ms. Hecker. But it is what is done in the electricity 
industry and the telecommunications, it is basically 
introducing more supply and demand discipline and information 
to users on the use of the----
    Senator Boxer. But it is not fair, either. What if I have 
to be at work at a certain time? I don't have a choice of when 
I go out on the road. It just is irritating.
    Anybody else care to comment on this argument that I have 
now gotten into with myself?
    [Laughter.]
    Mr. Cohen. Let me say as an engineer that we sometimes want 
to design the most robust system technically feasible, and 
perhaps something scaled-back would make a lot more sense and 
protect privacy a lot more. A couple of things just to watch 
out for: Right now, our fuel tax program has a serious amount 
of fraud in it. We have been working with Senators Baucus and 
Grassley on legislation to close some of those fuel tax fraud 
problems. I think a VMT system based on certification could 
also, of course, have a certain amount of fraud associated with 
it.
    And the other thing you have to watch out for is to make 
sure that the amount of miles is charged to the correct State. 
For example, if you are a trucker driving across the Country 
and you are registered in one State, you don't want all of your 
VMT taxes paid to your home State. It is just something to 
think about. But I don't think we need to have a system that 
follows people around.
    Senator Boxer. The point is, when you are registering your 
car, this would be a Federal tax or a Federal fee. They would 
just collect it, it doesn't stay in the State.
    Mr. Cohen. That is true.
    Senator Boxer. The State would be the collecting agency 
when you go to get your registration. It is pretty simple.
    Debra?
    Ms. Miller. Senator, I might weigh on that. I think really, 
for many of us, when we look at the long-term viability of the 
motor fuels tax, think about transitioning into other forms of 
taxation. The issue isn't just at the Federal level, it is at 
the State levels as well. So we would also be interested, over 
time, in replacing our State motor fuels taxes with VMT type 
taxes, certainly having that exploration. So it does get back 
to the issue that you would need to know what portion of this 
tax goes to the Federal Government, what portion stays with the 
State. There are also issues at the local level.
    Senator Boxer. Well, those are formula questions, which, as 
you know, are so easy for us to handle.
    [Laughter.]
    Senator Boxer. OK, I am going to call on Senator Voinovich 
as Ranking, then Senator Carper, then Senator Isakson.
    Senator Voinovich. Thank you, Madam Chairman.
    One of the issues that I brought up with Mary Peters was 
the issue of the 4(f) and the impediments. I would like you to 
briefly comment on why it is you think we can't make the 
changes. I tried very hard, and appreciate the fact that AASHTO 
recognized my effort on 4(f). But we have a situation in 
Cleveland right now where we want to put in an exit off a major 
highway. The building is eligible for the National Registry of 
Historic Places. It is eligible--it is not on the register--it 
is eligible. I have been told by the Department of 
Transportation that there are eight things that you have to 
show before they we will allow the city to take down the 
building even though the County owns it and wants to tear it 
down.
    Why haven't we been able to somehow get rid of some of this 
stuff that is just standing in the way that causes us to have a 
13-year tenure on a project, a major highway project? Any of 
you.
    Ms. Miller. Senator, I think that is an excellent question 
and it is one I would have myself. I think as if oftentimes the 
case with any major public policy, there are people who are on 
all sides of it, and there are those who feel strongly that 
there are elements of 4F that need to be protected. So it 
becomes a very difficult discussion.
    But certainly in my own State, we have had situations where 
we have had 4F impediments. I think it is hard to step back and 
think, from just a common sense approach, that they should have 
been impediments to the project. I don't think there is a clear 
understanding on the public's part what it is that is slowing 
projects down. And I think there is not sufficient transparency 
in that process, so people understand what is slowing the 
project down.
    Senator Voinovich. I am going to make a suggestion to all 
of you. It seems to me that as we move into the next highway 
bill, we are going to be getting into this. I would suggest 
that we--members of the Committee--and you, identify the 
various groups that have a stake in this, and rather than 
having them come in and lobby us, and you lobby some place 
else, that you all get into a room together and talk about this 
issue to see if there isn't something that can be worked out. 
Because so often we run into an environmental thing or this 
thing or that thing. I think that if you sat down and said--
environment, energy, economy--work it out, you could help us a 
great deal. That is just a suggestion.
    Yes, sir, Mr. Cohen.
    Mr. Cohen. I worked a bit on this issue. I really 
appreciate your leadership on getting that 4F provision in 
there. The reality is right now it is possible to filibuster a 
project for decades if you don't like it. The simple fact of 
the matter is that some time lines need to be put on this 
process. It just can't go on forever.
    Senator Voinovich. As you know, we had a provision in the 
highway bill that said that somebody would be the quarterback 
and all these groups would have to come in within a certain 
period of time, and show cause why they didn't want to go 
forward. And then somebody would finally be the determining 
factor about whether or not it was relevant or not relevant. 
For some reason, we were not successful with that. But it seems 
to me, that if we worked at it, we could get that done. But it 
is going to take a lot of communication, I think, between those 
of you that are out there in the private sector.
    Ms. Hecker, You were talking about the infrastructure costs 
that are required. The Commission estimates that we are going 
to have to invest $255 billion annually to maintain and improve 
the existing, which is tripling the $86 billion. In other 
words, the public ought to know this, we are spending $86 
billion, but the Commission says we have to spend $255 billion 
in order to just get the job done. And the Federal Government 
should maintain its current share of 40 percent. This implies 
that the States would have to increase the revenues to match 
the increase in Federal funds.
    The question is--is it reasonable to believe that the 
States would triple their investment in infrastructure at the 
current required 80/20 match? Would they raise the State gas 
taxes or other forms of revenue to match these Federal funds? 
Do you think this Commission report is realistic in terms of 
the dollars?
    Ms. Miller. One thing I would say it is certainly a varied 
answer from State to State. But for instance, in my own State, 
we have in about the last 20 years, and this is just using 
State revenues, not looking at what is contributed by local 
governments to transportation, but the Federal revenues are 
only about 25 percent of our overall State programs. So we are 
dramatically over-investing even the 40 percent which are 
national averages. There are certainly other States that are 
doing that.
    I think many times in the past, it is the Federal program 
which has led both State and locals. Oftentimes it has been the 
growth in the Federal program that then has encouraged State 
and local leaders to raise their local taxes, so that they 
could continue to make matches. I think you will find that 
there is a great deal of concern and interest in increased 
transportation spending at all levels of government.
    Now, absolutely I come from a State that like many States 
has many anti-tax voices, both in our legislature and in 
organizations who appear regularly before the legislature. We 
have had trouble, I think, in our Country in recent times 
talking about investments. We tend to talk about taxes as 
though that is the cost that is going to suck the life out of 
our economy, as opposed to thinking about investments that 
might help grow it. In my mind, we are not to the end of that 
discussion yet in our Country.
    So I am not saying it will be an easy discussion, but I do 
think frequently the leadership at the Federal level has 
brought along State and local governments. I see very strong 
interest and concern about greater investment in transportation 
from my own State.
    Senator Voinovich. I have one more question, and that is, 
your organization, Mr. Cohen, did not support an increase in 
the gas tax last time around, I believe, is that correct?
    Mr. Cohen. That is correct.
    Senator Voinovich. And it is my understanding now that at 
this stage of the game, you would be willing to support an 
increase in the gas tax?
    Mr. Cohen. Fundamentally, the last bill, when the gas tax 
was called for in the other body, we did not know what policy 
was associated with it and where exactly the money would be 
going. As one of the other Senators mentioned, we believe that 
the program reform must come first, and then highway users will 
come forward and pay for it and we will support an increase for 
a reformed program.
    Senator Voinovich. I think that it would be good for your 
organization to begin with saying that we need more money. 
Because sometimes there is a trick bag out there, they say, 
well, you figure out how you can do it and then we will cypriot 
It--and you know--you never get to it. But I think there should 
be a unanimous crescendo that we need more money, federally and 
state-wide. The question is, is it user taxes or some other 
method. But we need more money to get the job done.
    Then I think that it was Senator Alexander who made the 
point, we have to show the American people that we are working 
harder and smarter and doing more with less; i.e., we are 
taking the dollars that you are making to us, and we are coming 
up with a whole new system. For example, we have the interState 
system. Somebody should look at it broadly. In my State, for 
example, we have the TRAC. We look at the main arteries that 
have to be taken care of. They are the ones that get the money 
off the top. We have to look at the national system. There 
should be a consensus that says, we have to keep these major 
highways, maintain them and then move from that so that people 
can see the logic of what we are doing and show them how we are 
eliminating some of the red tape that stops some of these 
projects from going forward, that there is some prioritization 
of where money is going to be spent, so that we just don't 
nibble away at this, so that there is not much left for some of 
the things that we should be doing.
    But you will all admit, we need more money? OK, that is 
good, thank you.
    Senator Boxer. Thank you. Senator Carper?
    Senator Carper. Thanks very much.
    Secretary Miller, I am trying to remember the name of the 
Governor who spoke, who gave the Democrat response after the 
State----
    Ms. Miller. Governor Sebelius.
    Senator Carper. What State is she from?
    Ms. Miller. Kansas.
    Senator Carper. Would you tell her that an old recovering 
Governor said he was very proud of her?
    Ms. Miller. I would be happy to tell her that.
    Senator Carper. I have heard a lot of very positive 
comments. Give her a big thumbs up.
    One of my colleagues referred to the next version of our 
SAFETEA-LU, whatever we are going to call it, as the next 
highway bill. I would just remind us all, it is not the next 
highway bill, it is the next transportation bill.
    Ms. Miller. Absolutely.
    Senator Carper. Highways are certainly a big part of it, 
but not the only one.
    What we have here is a shared responsibility in trying to 
figure out, one, what are the responsibilities of us at the 
Federal level, is 40 percent the appropriate amount of funding 
that we should be providing, or should it be something more or 
less? I think it was Secretary Peters who was talking about 
national Federal role, national role. I would suggest to all of 
us that as a Nation, we have a dog in this fight. We have an 
interest in reducing our dependence on foreign oil. We have an 
interest in improving the quality of our air, reducing the 
health implications that flow from dirty air. We have an 
interest in reducing the threat to our planet that is posed by 
climate change and global warming. And we certainly have an 
interest in enhancing productivity in this Nation, and our 
transportation systems are not the only part of that, but a 
significant part of all of that.
    I want to come back to congestion mitigation, while the 
Chairman is not listening, and just say that on the idea of 
pricing services, we used to charge people a lot more to make 
long distance phone calls during the day than we did at night. 
We have cities like New York City that are now exploring 
charging people more money to come into the city at different 
times of the day. They are literally borrowing that idea from 
other cities around the world.
    I used to serve on the Amtrak board, and we used to ask, 
why is it that whether we are selling tickets to folks who want 
to ride the trains at the busiest rush hour part of the day, 
charging them the same amount of money that we do when not many 
people are riding the train during the middle part of the day? 
Why is that? Now Amtrak prices tickets with respect to what the 
market will bear. So there is plenty of precedent for that, and 
I hope we wouldn't shy away from it. I hope I can say that 
without starting a food fight up here with my Chairman.
    I want to ask each of you to just mention one or two 
things, very, very briefly, where you think that there is a 
broad agreement, including from among the four of you at the 
table, broad agreement on what the Commission has recommended. 
Just a couple of ideas very quickly, each of you. Where do you 
think there is broad agreement?
    Ms. Miller. Well, I'd say there's broad agreement that we 
need fundamental reform. I think that has to come first before 
people have confidence in giving us more money. I think there 
is broad agreement around the fact that we need a higher level 
of investment in transportation in our Country.
    Senator Carper. Thank you.
    Ms. Kavinoky. Well, she took my answers, so I will offer 
you a couple more. Because I do think that there is broad----
    Senator Carper. You could also say, I agree with that, 
but----
    Ms. Kavinoky. Well, I could say that, but I thought I would 
try a different transition.
    I think that speeding project delivery, and the fact that 
we are dealing with a multi-modal system here and not just one 
mode versus another is very important.
    Senator Carper. Thank you.
    Mr. Cohen.
    Mr. Cohen. I would say that streamlining is one that is 
unanimous, reform of the program, reduction of the number of 
programs, performance-based and outcome-driven programs were 
all things that all of the groups and the commissioners 
supported.
    Senator Carper. Thank you.
    Ms. Hecker. Others haven't mentioned it much, but the 
Commission in its discussion makes a big thing about getting 
better return on the investment, integrating cost-benefit 
decisionmaking, that we get a return on our investment and 
improved performance. I think that is a fundamental, central 
tenet and we would like to work with them to assure that there 
are program ideas that would effectively achieve those results.
    Senator Carper. Good. When we took a break during your 
testimony earlier today to pass, report out legislation that 
helps, enables the Environmental Protection Agency to better 
fund some of our diesel emission reduction needs. We were able 
to convince our colleague, Senator Voinovich, we were able to 
convince our colleagues to support it, because for every one 
dollar that we raise, we basically have a $13 payoff. And even 
in this town, people sit up and take notice at that.
    Let me ask the flip side of my question. That would be, you 
have indicated you have a number of ideas of concepts and 
recommendations around which there is great consensus. Maybe 
mention one that you think that there is little or no consensus 
that the Commission has recommended.
    Ms. Miller.
    Ms. Miller. I think that one of the issues that there is 
some concern about is the concept of the NAS track, I think is 
what it was called. Our organization had raised the issue of 
having some kind of a postal-style commission to deal with 
revenue increases. So there was support about that. But the 
Commission took the authority of that NAS track, if I am using 
the right term, much further than I think our organization 
supports. My sense is that there are others who have concerns 
about that approach.
    Senator Carper. Thank you.
    Ms. Kavinoky. I agree with Secretary Miller.
    Senator Carper. Thank you.
    Mr. Cohen. I would agree with that. I think also that the 
highest amount of the gas tax that they propose is somewhat 
controversial. But I think there is broad agreement that it 
will need to go up.
    Senator Boxer. Thank you, Senator.
    Senator Isakson.
    Senator Carper. Madam Chair, could we add 15 seconds so Ms. 
Hecker can actually respond to that question as well, please? 
Thank you.
    Ms. Hecker. Actually, it is one that you have raised. I 
think they talk a lot about the importance of pricing, getting 
the prices right. I don't think we really have a kind of 
national consensus on the role of pricing in transportation 
infrastructure.
    Senator Carper. Thank you. Thanks, Madam Chair.
    Senator Boxer. Thank you.
    Senator Isakson. A couple of comments. No. 1, Ms. Hecker 
made a tremendous opening statement, the first part of your 
opening statement I think hit the nail on the head when you 
talked about we needed two principles, a clear national 
interest and a clear Federal role, that we needed fiscal 
sustainability and we need to build in link to outcomes and 
build in performance standards and results. I think that ties 
in to what Secretary Miller said about the increase. We have to 
ensure the American people, if we get into this business of 
enhancing revenues, that we fix some of the systemic problems.
    In my State, where we recently had a change in 
commissioners of transportation, and I love the new one and I 
loved the old one, this is not a critical statement. But when 
the new one came in and did what new people do and started 
analyzing the system, they realized we had far over-promised in 
our DOT what our State could deliver.
    Well, Congress has far over-promised what we can deliver in 
terms of what we put in, in terms of designated projects in 
SAFETEA-LU. I think we all need to back up a second and say, 
what fundamentally can we do to put some principles and 
outcomes and base results in our system. And then when you look 
at revenues, you have a realistic chance to evaluate whether or 
not you in fact can do it, because fiscal sustainability does 
not exist right now with our current revenue statement. So that 
is a little statement, rather than a question.
    Second, I want the Chairman to be sure she understands that 
my interest in VMTs has nothing to do with her private 
lifestyle. And I agree with the comments that you made about 
being concerned about that. But----
    Senator Boxer. It is not about me. It is about your 
constituents.
    Senator Isakson. Our constituents. But it certainly is an 
intriguing process that we should investigate as we look at the 
financing model in the 21st century. So I am not sold on it by 
any stretch, didn't want you to think that.
    And I commend Senator Voinovich on the streamlining 
comments that he made. We have such a problem now in getting a 
road from concept to paving, it is unbelievable. And it is 
getting worse. Senator Carper made the comment about China's 
road system and how great they were doing. Well, they don't 
have an OSHA and they don't have an Environmental Protection 
Agency. And they don't have standards that we impose on our 
people. But we have to find a way to streamline the process 
from concept to actually making pavement in this Country, or we 
will never have financial sustainability under any 
circumstance.
    So those were not questions, those were just comments. I 
will say, I think this panel has given, in each and every case, 
a good cross-section of interest in what we need to do with 
regard to the report, Madam Chairman. I think if we can all 
leave everything on the table, from the revenue side to the end 
product side, and look at building in systems where we are 
looking to results, we are looking to outcomes and there is 
accountability up and down the situation, then I think it is 
possible to do things that some might think are impossible to 
do.
    But my home town of Atlanta, the Atlanta Regional 
Commission, which is the metropolitan planning agency that does 
our TIP, I believe the last number I saw is that they can only 
complete 38 percent of the projects that are in the TIP now. 
And that is getting, that is reflective around the Country, I 
think, with the escalated price of putting in transportation. 
So we have to follow the admonition of Ms. Hecker in terms of 
demanding results and accountability, and follow what Secretary 
Miler in putting that responsibility first, and then putting 
the revenue mechanism second.
    I won't ask a question, I just wanted to make those 
comments.
    Senator Boxer. Before you have to leave, let me just say 
that I am all for streamlining, as long as we keep protections 
in there. Because in China, they can't breathe very well, 
either.
    Senator Isakson. That was my point.
    Senator Boxer. We need to make sure we can build the roads, 
but do it right, make sure that we have environmental 
protections.
    I have seen it in my State where we have waived certain 
statutes because we have had emergency situations. Frankly, it 
has turned out pretty well. So I think, as I look at it, as a 
strong environmentalist, what I don't want to do is take away 
the rights of people to have a say, but I think there should be 
timeframes built in. Because if you stall things too long, this 
is when you have the escalation in costs and frankly, we have 
wasted time. And a lot of times when we are building a road 
that is going to move goods faster, that is going to help us 
cleanup the air, rather than have trucks stalling.
    So it is all about getting the right balance. I really do 
look forward to working with everyone to get that balance, so 
that we know we are not--there should not have to be a choice 
between a clean environment and an efficient infrastructure. We 
have to be able to figure out how to make it compatible. I 
think that we can.
    Senator Barrasso.
    Senator Barrasso. Thank you very much, Madam Chairman. I 
appreciate your taking the time to hold these hearings. I 
appreciate all those coming to testify today.
    Between our first hearing last week and the hearing today, 
there was a second transportation commission report issued. 
They really talked about the damage done to roads in places 
like Wyoming that I brought up last time. It says rural lane 
miles represent over 70 percent of the Federal system lane 
miles and are important to the national network. It gets to the 
issues that I talked about with moving product across the 
Country from the ports to the markets. It says, ``Preservation 
and maintenance of rural infrastructure enables the movement of 
people and goods between large metropolitan areas and across 
the Country and can place a significant burden on State and 
local rural governments. Overall, funding of transportation in 
rural areas is particularly challenging.'' Then it says, in 
those places, things like tolling don't work, and the specific 
costs and fees.
    Ms. Kavinoky, I would start with you, because you are from 
Thermopolis, Wyoming. In reading your conclusion in your 
report, it sounds like someone with that can-do approach from 
Thermopolis, Wyoming. It sounded like a Bobcat, it is 
magnificent.
    Ms. Kavinoky. Thank you very much.
    Senator Barrasso. I don't know if you have any thoughts on 
the whole funding mechanism, from the Chamber's standpoint or 
from your own, growing up there, on the best ways that we can 
handle these long expanses that are used, but the local folks 
aren't the ones that are really tearing up the roads.
    Ms. Kavinoky. I think the one thing I would point out, and 
thank you for the question, is that there are different ways to 
get projects done. In rural areas, it is really about systemic 
funding. Those are things like the gas tax, user fees on fuels, 
heavy use vehicle taxes, the things that we collect at the 
Federal level, but that are also collected at the State and 
local levels, that go to fund the system as a whole. Then there 
are ways to finance projects, and that is when we start talking 
about dealing with congestion issues or tolling.
    So that is why the Chamber says it is going to take 
everything that we have to deal with these problems, both an 
increase in systemic funding as well as looking more at things 
like project financing.
    Senator Barrasso. Great. Madam Chairman, I don't have any 
additional questions, but just listening to you and to Senator 
Voinovich, I would like to just quote one of the final words in 
Ms. Kavinoky's conclusion. She says, ``Surely we ought to be 
able to create the vision, forge the consensus, secure the 
resources and find the political courage to make this happen.''
    Thank you very much, Madam Chairman.
    Senator Boxer. Thank you. I do find those words inspiring. 
I was hoping that we could hear them from the Secretary of 
Transportation as well as from this panel.
    But it is all right. We are going to have that passion 
right here on this Committee.
    Senator Carper, would you like to have another round. 
Because I do not need another round.
    Senator Carper. Thank you, Madam Chair.
    I have been talking with some of our colleagues, including 
some of our colleagues on this panel, about the economic 
stimulus package that is before us that we will be voting on 
today or tomorrow, and probably again next week. A couple of my 
colleagues have said, it is all well and good that we try to do 
something in the near term to stimulate the economy, but how 
about something beyond the near term? It occurs to me, I would 
say to my colleagues, it occurs to me that among the things 
that we can do in longer term, not just to stimulate our 
economy and create jobs, but to make us more productive as a 
Nation and do all the other good things that I talked about in 
terms of cleaning our air and reducing our reliance on foreign 
oil, is to take to heart the recommendations from the 
Commission that we are holding this hearing on today.
    A lot of times, commissions are created, we get the 
reports, we file them away and they never see the light of day. 
I arrived here in January 1983 as a freshman Congressman, with 
Senator Boxer and Tom Ridge, John McCain, a whole lot of other 
people, John Spratt. We arrived at a time when the Social 
Security Administration was about to go broke, not like in 20 
or 30 years, it was about to go broke that year.
    And we had a commission led by Alan Greenspan who submitted 
their report, the commission was bipartisan, truly bipartisan, 
not only in its membership but the buy-in of President Reagan 
and the buy-in of Speaker Tip O'Neill. And they sort of rolled 
up their sleeves and said, we have to make this happen. They 
provided little political protection, if you will, for 
Democrats and Republicans to do some of the difficult things we 
needed to do. We went out and did them. We didn't save Social 
Security forever, but we certainly got it through the next 
quarter century. Now we come back to revisit that. I think we 
can take, if we have the same kind of leadership, we will come 
up with ways to protect Social Security for a whole lot 
further.
    There is a great opportunity here that you, that the 
Commission has presented to us. Your comments today are helping 
us to look at it maybe through a different set of glasses. It 
is very helpful and valuable. I appreciate very much having 
this hearing. I think this is important. I hope people don't 
under-estimate the importance of what could flow from this.
    The other question I have is, I mentioned earlier in my 
comments, I once served on the Amtrak board of Governors. I was 
Tommy Thompson's successor and his predecessor. At that time, 
one member of the board was a Governor appointed by the 
President and confirmed by the Senate. I still follow passenger 
rail issues pretty closely. I noted that in the first quarter 
of this fiscal year, from October 1st to this past December 
31st, ridership on Amtrak was up by about 15 percent, revenues 
were up by about 15 percent. Something is going on. Something 
is going on. I think it is a combination of people getting 
tired of sitting in their cars, trucks and vans, people are 
getting tired of congestion around airports, and they want an 
alternative.
    We are going on a separate track to reauthorize Amtrak and 
to try to provide for, if you will, a vision for passenger rail 
service in the 21st century. With that in mind, let me just ask 
each of you to give us some thoughts as we pass the legislation 
through the Senate. We are going to be working with our 
colleagues in the House. If you will envision what should 
passenger rail service be in the 21st century, how do we marry 
passenger rail with freight. Because when Amtrak travels 
outside the Northeast Corridor, they have to share the tracks 
with the freights. The priority is moving freight, not people.
    How do we sort of get a partnership that would involve the 
States, involve local governments, involve the Federal 
Government, involve the freight railroads, to help make 
passenger rail not something of the past, but to make it 
relevant for the 21st century? And I think it is. Any comments 
on that?
    Ms. Miller. If it is all right, I might start in. Because I 
would say, Senator, you are exactly right. Something, I think, 
is afoot with Amtrak. Again, I come from the State of Kansas, 
where highways are king. And I increasingly get questions from 
communities and citizens, there is a huge movement afoot in our 
State to try to extend Amtrak services.
    It is a true interest. We had a meeting with Amtrak and 
BNSF, because that is the track in Kansas, the freight track 
that this line would go on. I invited members of our house and 
senate transportation committee, and on a day when they would 
not normally be in Topeka, we got eight members of our 
legislature to come to a meeting, which tells me a lot about 
the level of interest.
    My other observation, because I would have to say, this is 
not an area in which I am very expert, so I don't mean to imply 
that. But it was fascinating to me, we had a great meeting 
listening to both the Amtrak folks and the BNSF folks talk very 
cooperatively but about the challenges we would have in trying 
to establish this service. Practically impossible was my 
conclusion, quite frankly. The investment is going to be huge 
to get the kind of siding, so that you could actually have 
timely service.
    So what I am struck by, and listening to your example from 
Shanghai, increasingly, and it would certainly get my husband 
off my back, who says regularly, why can't we have rail service 
in this Country, there is a need to make an investment far and 
away larger than we have been willing to date to make, it seems 
to me. And I think we have to recognize that you can't have 
passenger service sharing freight service rail lines, or at 
least you need to do it in a way that gives opportunities for 
passing. Or it is just simply never going to be a service that 
works.
    Senator Carper. Thank you. Ms. Kavinoky?
    Ms. Kavinoky. Senator Carper, passenger rail is not 
something that the Chamber traditionally has delved into. I 
will say this, as I speak with chambers of commerce that 
represent corridors like the Northeast Corridor and also in 
California, we get strong opinions on the need for different 
kinds of transportation service and different kinds of options. 
I think that will lead us to consider where we want to go in 
terms of passenger service.
    I will agree, though, with Secretary Miller, unless we make 
a real commitment in this Country to supporting passenger rail, 
and that is a commitment that is a dollars and sense commitment 
as well, then we will continue to have sort of a haphazard 
system.
    Senator Carper. Thank you.
    Mr. Cohen.
    Mr. Cohen. As a highway expert, most of my knowledge about 
Amtrak and passenger rail comes from what I read from GAO. My 
feeling about it is that Amtrak can do well in certain 
corridors of the Country and could probably survive on a ticket 
tax as the Commission proposed. The simple fact is that in 
other parts of the Country, the subsidy would have to be so 
high that the ticket tax would have to be equal or more to the 
fare to make it work.
    So of course, we all want to see good a mass transportation 
system. But I wouldn't leave out the private bus operators, who 
compete with Amtrak without any subsidies at all, except 
perhaps maybe building a multi-modal bus station at a train 
station, and are doing quite well in the private sector.
    Senator Carper. I would just add, there is a way for them 
to work together instead of being stovepipes, there is a great 
way for them to work together. One of the things we are trying 
to focus on is, how do we make train passenger rail work better 
with airports. We have some great examples, BWI is a pretty 
good example, it works very well. Newark, New Jersey is a good 
example, where people can take the train to those places, get 
on a plane--and how about Cleveland, Ohio?
    Senator Voinovich. How about Cleveland?
    Senator Carper. How about Cleveland, all right.
    Senator Boxer. In the whole Bay Area, we have BART.
    Senator Carper. That is good. Last comment, please.
    Ms. Hecker. We have done a substantial amount of work on 
inter-city passenger rail. Our comprehensive review of Amtrak 
management actually raised substantial concerns that they 
really didn't have strategic planning, that they didn't have 
financial management, that they didn't have good controls, they 
didn't control their procurement, that it was not a functioning 
organization. Its route map has barely changed in 35 years, and 
if we think about transportation and how all of the 
transportation sectors have transformed, so the structure that 
we have, the incentives are not working very well, we are not 
getting good value for the over $1 billion we invest in Amtrak 
each year.
    While there is some growth, we found that almost all the 
growth in inter-city passenger rail are State-supported routes. 
Amtrak supports the core system and they don't support the add-
on systems. States that have made the decision to invest, those 
are the routes that are taking off. They know where the demand 
is, they know where the return is, and they have made 
enormously efficient decisions. That is one of the dangers of 
the proposal here, to substitute 80 percent Federal money, 
which is not well-planned, not well-utilized. So there is a 
role for passenger rail. It shouldn't be rhetorical, we 
shouldn't just say, oh, it is efficient or, oh, it is a better 
environmental option. Because as we know, on a long distance 
basis, it is less than half of 1 percent of the demand to get 
between D.C. and Chicago. I mean, who gets on a train to go to 
Chicago? And yet we have these long distance routes. And the 
loss per passenger is over $400 per person on many of those 
routes.
    Senator Carper. My time is expired. I was kidding with our 
colleague Mark Potter yesterday, who along with Blanche Lincoln 
has invited me to come down to Little Rock for a luncheon later 
this month. I am happy to go. I was kidding him about how 
difficult it is to get from Delaware to Little Rock by 
airplane. And Mark Potter, who knows my interest in passenger 
rail, said, well, you could take the train, and you can go 
through Chicago and then come back down to Little Rock, you 
will be there in a couple of days.
    [Laughter.]
    Senator Carper. Let me just close, Madam Chair, thank you, 
you have been very generous with the time, let me just close 
with this thought. Over half the people in our Country now live 
within 50 miles of our of our coasts. Think about that. Over 
half the people in our Country live within 50 miles of one of 
our coasts. There are any number of densely populated 
corridors, which have developed over time, that can be well 
served by passenger rail, and I think in some cases it makes a 
lot of sense, not in all parts of our Country, but certainly in 
those densely populated corridors.
    I don't think anybody is suggesting that it should be an 
entirely Federal undertaking. But there is a shared 
partnership. And California has done wonderful things, some of 
the great growth you have seen in passenger rail is on the west 
coast where the States have bought in big time.
    But if you look at the Northeast Corridor, the Acela 
Express Service, which is one of the things I worked on when I 
was on the board, sells out. I won't say it is a cash cow for 
the rest of the system, for the rest or the corridor, but with 
the kind of investments in the Northeast Corridor to allow 
those trains to run 150 miles an hour, it literally can be a 
cash cow to carry this part of the system.
    Last comment, Madam Chair. I heard Ed Rendell say this the 
other day, too, which I thought, he must have stolen that from 
me. But to move one ton of freight by rail from Washington, DC. 
to Boston, Massachusetts, one ton of freight by rail from 
Washington, DC. to Massachusetts, takes one gallon of diesel 
fuel. One gallon of diesel fuel. There is real potential there 
for us, and we shouldn't lose sight of that.
    Madam Chair, you have been very, very generous. Thank you 
very much and to our panel.
    Senator Boxer. Absolutely.
    I would just say to Ms. Hecker, if you were going to say, 
who is going to go from Paris to Berlin by train, everybody. I 
think that it is a matter of culture, it is a matter of letting 
people know. Because I will tell you, I take the train a lot to 
New York. Do you ever do that?
    Ms. Hecker. I do, yes.
    Senator Boxer. So it becomes a way, I mean, I much prefer 
to do that, frankly, than go to the airport. By the time I get 
to the airport, go through security, it takes hours. I get on a 
train, it is pleasant, I am there. So I think the question that 
we face here, and why I am a very strong supporter of what 
Senator Carper does with rail is, as it gets tougher and 
tougher to go with other modes, it would be tragic to just take 
away that option.
    It reminds me, in California, they ripped up every single 
ounce of rail line, because the motor vehicle was coming. Now 
we are spending a fortune to buy back the right-of-way to put 
down the tracks that they ripped up. So I think before we just 
say who does this and who goes there, I think we need a bit 
more of a broader look at the future, rather than just say, and 
yes, you are right, we obviously don't want to throw money 
away. We can't afford to. But we also need to preserve these 
options, I think.
    The last thing I will say is, in Marin County, where I 
lived for so many years, in the Bay Area, we had a ferry boat 
system. And everyone said the same thing, who is going to take 
the ferry boat. And for years, they didn't take it. It is so 
true, it was really tough. Now, they take it. Because when you 
compare it to the price of a toll on the Golden Gate Bridge and 
the cost of gasoline, et cetera, suddenly, this becomes a 
viable option. So I would be very careful not to just throw 
things away and capacity away without thinking it through.
    Senator Voinovich, you can finish this whole thing up. It's 
all in your hands.
    Senator Voinovich. Thank you. I will try and make it brief.
    First of all, Madam Chairman, I would appreciate my 
statement being put in the record.
    Senator Boxer. I will put your full statement in, and also 
the Coalition for America's Gateways and Corridors, at the same 
time, without objection.
    [The prepared statement of Senator Voinovich follows:]

     Statement of Hon. George V. Voinovich, U.S. Senator from the 
                             State of Ohio

    Thank you, Madame Chairman, for holding this hearing today 
to hear the views from these groups on this commission's 
report.
    It is no secret that this nation has an aging 
transportation infrastructure. And I believe that it's the 
government's role to provide funding for our nation's 
infrastructure so our businesses can compete in this global 
marketplace.
    Federal transportation policy is of particular importance 
to my State because Ohio has one of the largest surface 
transportation networks in the country. The State of Ohio has 
the 10th largest highway network, the fifth highest volume of 
traffic, the fourth largest interState system and the second 
largest number of bridges. 14 percent of all freight that moves 
in the United States moves in, through, or out of Ohio--the 
third greatest amount of any state.
    Throughout my career, I have worked to increase funding for 
infrastructure. As Governor, during ISTEA, I fought to increase 
Ohio's rate of return from the Highway Trust Fund from 80 
percent to 85 percent. In 1998, as Chairman of the National 
Governors Association, I was involved in negotiating TEA-21 and 
I fought to even out highway funding fluctuations and assure a 
predictable flow of funding to states.
    During consideration of SAFETEA-LU, I pushed for increased 
funding. I thought the total funding levels were well below 
what was appropriate and necessary for the nation's 
infrastructure needs. Even, the Federal Highway Administration 
acknowledged that more funding was needed. In 2004, Federal 
Highways stated that the average annual investment level needed 
to improve our highways and bridges would be $118.9 billion. 
The average annual investment level necessary to just maintain 
the current condition and performance of highways and bridges 
would be $77.1 billion.
    I predicted that the money spent from that authorization 
bill would not be enough. Sadly, I was right. Because of the 
rising costs of construction and energy, the purchasing power 
from SAFETEA-LU has significantly declined. This bill did not 
keep up with inflation, and as a result, we have fallen behind. 
Highway projects are being canceled and states and locals have 
had to step-up and assume more of the financial burden, and 
they are doing so at a time when many states are projecting 
severe budget shortfalls. The State of Ohio is facing a 
shortfall of $3.5 billion.
    If any of us think that we can deal with these problems 
without more money, we are being intellectually dishonest. I 
hope the next president understands this clearly.
    I don't trust that the Presidential candidates truly 
understand the gravity of the situation either--they have 
completely ignored the topic on the campaign trail. I hope that 
the witnesses today can shed some light on a topic that so many 
elected officials seem to be ignoring.
    Recently, we have been talking about putting together an 
economic stimulus package to jumpstart the economy. I think our 
failure to invest in the improvements necessary to keep pace 
with our growing population and increasing demands is one of 
the roadblocks standing in the way of moving our economy 
forward. Investing in our nation's transportation could create 
hundreds of thousands of jobs and move our sluggish economy 
down the road to recovery. Manufacturing states, such as Ohio 
with a ``just-in-time'' economy, cannot be competitive with 
failing infrastructure where traffic congestion and bottlenecks 
in our rails and waterways is the norm. I am very encouraged 
that this report recognizes the link between our infrastructure 
and our ability to compete in the global market.
    As Ranking Member of the Clean Air and Nuclear Safety 
Subcommittee, I am well aware of the important relationship 
between highway planning and air quality. I am pleased that 
this report emphasizes environmental stewardship and recommends 
more State flexibility on funding efforts to improve our air 
quality.
    I also support the Commission's recommendations on 
improving and streamlining the delivery of transportation 
projects. As a former Governor and Mayor, I have been 
frustrated at how long it can take to finish a highway project 
from beginning to end. In fact, during my first Senate 
campaign--as part of my platform, I pledged to reduce this 
timeframe. I am pleased that this report acknowledges this lag 
time--major projects take nearly 13 years on average to 
complete. I was pleased with the changes we made with 4(f) in 
the last highway bill, but the fact is that it didn't get the 
job done.
    This report echoes what I have been saying for years--it's 
the government's role to provide the infrastructure for 
American business, and unless we develop this infrastructure of 
competitiveness, our children and grandchildren will not be 
able to enjoy the same standard of living and quality of life 
that we have enjoyed.
    The American people must be made aware of the 
infrastructure challenges our nation faces. Hopefully, with 
your participation, our hearing today can shed more light on 
this critical issue.
    [The prepared statement of the Coalition for America's 
Gateways and Corridors follows:]
[GRAPHIC] [TIFF OMITTED] 85520.064

[GRAPHIC] [TIFF OMITTED] 85520.065

    Senator Voinovich. I would like to read a portion of my 
statement to the panelists. It says, recently we have been 
talking about an economic stimulus package to jumpstart the 
economy--we are going to do something here hopefully before the 
President's break. I think our failure to invest in the 
improvements necessary to keep pace with our growing population 
and increasing demands is one of the roadblocks standing in the 
way of moving our economy forward. Investing in our Nation's 
transportation could create hundreds of thousands of jobs and 
move our sluggish economy down the road to recovery. 
Manufacturing States, such as Ohio, with a just-in-time 
economy, cannot be competitive with failing infrastructure. 
Traffic congestion and bottlenecks in our rails and waterways 
is the norm. I am encouraged that this report recognizes the 
link between our infrastructure and our ability to compete in 
the global marketplace.
    Then as ranking member of the Clean Air and Nuclear Safety 
Subcommittee, which I serve on with Senator Carper, I am well 
aware of the relationship between highway planning and air 
quality. I am pleased that the report emphasizes environmental 
stewardship and recommends more State flexibility on funding 
efforts to improve our air quality. So those are good things.
    We need to really emphasize how important it is that we 
develop the infrastructure of competitiveness, so that our 
children and grandchildren can enjoy the same quality of life 
and standard of living that we have. This is really important 
stuff, and I am very pleased that those of you representing 
outside groups seem to be pleased with this Commission's report 
and seem to be really enthusiastic about it.
    But I can assure you that unless you really get involved--
and we are going to get started on this highway bill probably 
toward the end of this year--when we do a lot of preliminary 
stuff, but as someone mentioned, you have to get this highway 
bill done on time. I think Ms. Miller said, you have to get it 
done on time or we are really in deep trouble.
    But I have learned, I was president of the National League 
of Cities, and then I was chairman of the National Governors 
Association, I lobbied this place for over 18 years. The way 
you get things done down here is to get groups together on a 
bipartisan basis--Republicans and Democrats, private sector 
people and in this particular case, you are going to have to 
involve some of the environmental groups and so forth that are 
out there, to get together and say, this is important for our 
Country and work this out, so that we can really do the things 
that we need to do in the area of infrastructure.
    It is absolutely one of the ingredients of our future 
success as a Nation. Somehow, we have to communicate that to 
the American people. It is through organizations like yours 
that we can get the job done.
    So I want you to know that the Chairman and I and others 
are looking forward to working with you. We need your help. 
Thank you.
    Senator Boxer. Senator, thank you so much. That echoes, as 
you said, what I asked them in my very first question.
    I am excited about the job we have ahead of us. And it is 
made so much easier when we hear your voices, really it is. And 
we say that in all humility. We cannot get the momentum we need 
without those voices. So if you could take back to your 
membership that we really appreciated your testimony here, it 
means a lot to us, and we are going to get ready with an 
ambitious bill that has vision, it is going to meet the needs, 
we are going to present it to our colleagues, and I feel, and 
to a new President. We don't know who that will be, but whoever 
it is, one party or the other is going to know that we can't 
have a growing economy without an infrastructure that meets the 
needs.
    So thank you very, very much, all of you. We really 
appreciate your contribution today. Thank you, Senator 
Voinovich.
    [Whereupon, at 12:10 p.m., the committee was adjourned.]
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