[Senate Hearing 114-408]
[From the U.S. Government Publishing Office]






                                                        S. Hrg. 114-408
 
                  HOW THE INTERNET OF THINGS CAN BRING
                 U.S. TRANSPORTATION AND INFRASTRUCTURE
                         INTO THE 21ST CENTURY

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

                                HEARING

                               before the

                 SUBCOMMITTEE ON SURFACE TRANSPORTATION
                  AND MERCHANT MARINE INFRASTRUCTURE,
                          SAFETY AND SECURITY

                                 of the

                         COMMITTEE ON COMMERCE,
                      SCIENCE, AND TRANSPORTATION
                          UNITED STATES SENATE

                    ONE HUNDRED FOURTEENTH CONGRESS

                             SECOND SESSION

                               __________

                             JUNE 28, 2016

                               __________

    Printed for the use of the Committee on Commerce, Science, and Transportation
    
    
    
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       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                    ONE HUNDRED FOURTEENTH CONGRESS

                             SECOND SESSION

                   JOHN THUNE, South Dakota, Chairman
ROGER F. WICKER, Mississippi         BILL NELSON, Florida, Ranking
ROY BLUNT, Missouri                  MARIA CANTWELL, Washington
MARCO RUBIO, Florida                 CLAIRE McCASKILL, Missouri
KELLY AYOTTE, New Hampshire          AMY KLOBUCHAR, Minnesota
TED CRUZ, Texas                      RICHARD BLUMENTHAL, Connecticut
DEB FISCHER, Nebraska                BRIAN SCHATZ, Hawaii
JERRY MORAN, Kansas                  EDWARD MARKEY, Massachusetts
DAN SULLIVAN, Alaska                 CORY BOOKER, New Jersey
RON JOHNSON, Wisconsin               TOM UDALL, New Mexico
DEAN HELLER, Nevada                  JOE MANCHIN III, West Virginia
CORY GARDNER, Colorado               GARY PETERS, Michigan
STEVE DAINES, Montana
                       Nick Rossi, Staff Director
                 Adrian Arnakis, Deputy Staff Director
                    Rebecca Seidel, General Counsel
                 Jason Van Beek, Deputy General Counsel
                 Kim Lipsky, Democratic Staff Director
              Chris Day, Democratic Deputy Staff Director
       Clint Odom, Democratic General Counsel and Policy Director
                                 ------                                

      SUBCOMMITTEE ON SURFACE TRANSPORTATION AND MERCHANT MARINE 
                  INFRASTRUCTURE, SAFETY AND SECURITY

DEB FISCHER, Nebraska, Chairman      CORY BOOKER, New Jersey, Ranking
ROGER F. WICKER, Mississippi         MARIA CANTWELL, Washington
ROY BLUNT, Missouri                  CLAIRE McCASKILL, Missouri
KELLY AYOTTE, New Hampshire          AMY KLOBUCHAR, Minnesota
JERRY MORAN, Kansas                  RICHARD BLUMENTHAL, Connecticut
DAN SULLIVAN, Alaska                 BRIAN SCHATZ, Hawaii
RON JOHNSON, Wisconsin               EDWARD MARKEY, Massachusetts
DEAN HELLER, Nevada                  TOM UDALL, New Mexico
STEVE DAINES, Montana


                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on June 28, 2016....................................     1
Statement of Senator Fischer.....................................     1
Statement of Senator Booker......................................     3
    Prepared statement...........................................     4
Statement of Senator Cantwell....................................    48
Statement of Senator Markey......................................    50
Statement of Senator Klobuchar...................................    54
Statement of Senator Blumenthal..................................    57

                               Witnesses

Hon. Carlos Monje, Jr., Acting Under Secretary of Transportation 
  for Policy, and Assistant Secretary for Transportation Policy, 
  U.S. Department of Transportation..............................     5
    Prepared statement...........................................     6
Seleta Reynolds, General Manager, Los Angeles Department of 
  Transportation; and President, National Association of City 
  Transportation Officials (NACTO)...............................    11
    Prepared statement...........................................    13
Doug Davis, Senior Vice President and General Manager, Intel 
  Corporation....................................................    16
    Prepared statement...........................................    17
Dr. Robert Edelstein, Senior Vice President, ITS Practice Lead, 
  AECOM..........................................................    31
    Prepared statement...........................................    32
Jordan Kass, President of Managed Services, C.H. Robinson........    40
    Prepared statement...........................................    42

                                Appendix

Response to written question submitted by Hon. Richard Blumenthal 
  to Hon. Carlos Monje, Jr.......................................    59


                     HOW THE INTERNET OF THINGS CAN



                     BRING U.S. TRANSPORTATION AND



                  INFRASTRUCTURE INTO THE 21ST CENTURY

                              ----------                              


                         TUESDAY, JUNE 28, 2016

                               U.S. Senate,
         Subcommittee on Surface Transportation and
            Merchant Marine Infrastructure, Safety and Security,   
        Committee on Commerce, Science, and Transportation,
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 9:45 a.m. in 
room SR-253, Russell Senate Office Building, Hon. Deb Fischer, 
Chairman of the Subcommittee, presiding.
    Present: Senators Fischer [presiding], Ayotte, Heller, 
Daines, Johnson, Booker, Cantwell, Klobuchar, Markey, and 
Blumenthal.

            OPENING STATEMENT OF HON. DEB FISCHER, 
                   U.S. SENATOR FROM NEBRASKA

    Senator Fischer. Good morning. I am pleased to convene the 
Senate Subcommittee on Surface Transportation and Merchant 
Marine Infrastructure, Safety and Security for today's hearing 
entitled, ``How the Internet of Things Can Bring U.S. 
Transportation and Infrastructure into the 21st Century.'' This 
hearing will examine how the Internet of Things can advance our 
Nation's transportation and infrastructure system.
    America's transportation network is well-positioned to 
benefit from new developments in technology. For example, the 
Internet of Things offers new ways to help alleviate congestion 
on our Nation's roads, reduce cargo shipping delays at ports, 
and monitor rail and pipeline infrastructure safety. This 
growing interconnected network can inform policymakers on where 
to invest limited resources in road and bridge maintenance.
    In March, Senator Booker and I joined Senators Ayotte and 
Schatz to introduce the Developing Innovation and Growing the 
Internet of Things Act, or the DIGIT Act. This bipartisan 
legislation builds on our resolution, which passed the Senate 
last year. It calls for a nationwide strategy to drive 
development of the Internet of Things.
    The DIGIT Act would convene a working group of private and 
public sector stakeholders to offer recommendations to 
Congress. They would focus on how to plan for and encourage the 
growth of the Internet of Things. Our bill would begin 
discussions on the future of this network, and ensure that the 
United States is adopting policies that accelerate innovation 
and allow it to thrive.
    This could have a positive effect on transportation. For 
instance, global supply chains represent a major opportunity to 
take advantage of the Internet of Things to grow exports and 
imports. In today's just-in-time shipping environment, time is 
money and efficiency is key.
    According to the U.S. Department of Transportation, by 
2045, freight volumes will increase by 45 percent. DOT in its 
Beyond Traffic report found that transportation delays have a 
high cost. For example, Nike spends an additional $4 million 
per week in extra inventory to compensate for shipping delays. 
The same report found that a week-long disruption at our 
Nation's two largest ports, LA and Long Beach, would cost our 
economy as much as $150 million per day.
    Meanwhile, supply chains are changing rapidly in response 
to transportation delays and alternative options. For example, 
after 9 years, the $5.4 billion Panama Canal expansion is 
expected to open this week. Following the project's completion, 
the Panama Canal will be able to process ships nearly 3 times 
as large as before and will provide a greater connection 
between our East Coast ports and Asian export markets.
    A recent white paper co-authored by C.H. Robinson and the 
Boston Consulting Group pointed out that the canal's expansion 
promises to reorient the landscape of the logistics industry 
and alter the decisionmaking calculus of shippers that the 
canal serves.
    Delays in our logistics chain raise costs for shippers, 
infrastructure operators, carriers, and, yes, consumers. By 
increasing connectivity and real-time data flows between 
stakeholders, our transportation network and its users will 
gain productivity.
    Infrastructure design, construction, maintenance, and 
safety will also benefit from improved data and connectivity.
    State and local highway officials constantly face 
challenges when allocating limited resources to an array of 
transportation projects. For example, AECOM has established a 
Self-Monitoring Analysis and Reporting Technology system, known 
as SMART, to remotely monitor bridges, dams, and other 
transportation assets. AECOM's SMART infrastructure seeks to 
use the Internet of Things to enhance the operating 
efficiencies of infrastructure and lengthen the life of these 
critical assets.
    Real-time monitoring represents a critical analytic tool 
that can enable States and localities to expend highway dollars 
in a risk-based manner, thereby bolstering safety and 
infrastructure reliability.
    As part of the FAST Act, I worked with my colleagues on 
this committee to author a robust national freight policy that 
will provide States with greater resources to designate 
critical urban and rural corridors. Congress also expanded the 
objectives of the Intelligent Transportation System program, 
which seeks to integrate technology, communications, and data 
into our transportation network to include enhancing our 
national freight network.
    Senator Booker and I have been working together to better 
understand the possibilities of the Internet of Things and to 
educate our Senate colleagues on them.
    I'm pleased that we have an exceptional group of 
stakeholders appearing before the Subcommittee today. We are 
fortunate to have officials who are developing policy at the 
Federal and local levels, and I am eager to hear how private 
sector stakeholders are utilizing the Internet, data, and 
technology to manage infrastructure projects and advance 
freight and passenger transportation networks.
    I would now like to invite my friend, Senator Cory Booker, 
our Ranking Member, for any comments he may have.

                STATEMENT OF HON. CORY BOOKER, 
                  U.S. SENATOR FROM NEW JERSEY

    Senator Booker. Thank you very much, Chairwoman Fischer.
    I, first of all, want to submit my formal opening remarks 
to the record. I am kind of geeking out about this meeting, and 
I think this is tremendous that you all are here.
    There is a lot going on in Washington today, some of it 
laced with lots of partisanship, but this hearing right now 
with my partner on a lot of things, more than I could've 
imagined, the Chairwoman and I have found a lot of things to 
work on that are really forward-facing, trying to make not only 
government more efficient and effective, but really trying to 
echo what was bipartisan work of the past.
    It was a great Republican President named Eisenhower who 
understood, to help the private sector flourish, there has to 
be creative public-private partnerships. One of the great ways 
to create connectivity of the past was just building roads and 
bridges to help connect our country.
    Now we are in an entirely different era, things that I 
couldn't have even imagined when I saw my father bring home the 
first VCR I had ever seen and plug it in in my house. Now we 
have more connected devices on the planet Earth than there are 
people, and we are in the stone age of the Internet of Things.
    What excites me is that I have a partner to my right here 
who understands that if we in government don't get our act 
together, we are going to miss out on not only trying to help 
the private sector flourish in this area, but frankly, we are 
going to drag down the private sector, because we are going to 
have agencies within the government that are working in silos 
and are tripping up and undermining innovations.
    I am extraordinarily excited about this panel because you 
all are on the cutting edge of what is a whole new world, and a 
world that for me as a guy who comes from the inner city and 
represented that as mayor, I began to see how connectivity, 
innovation, and technology, can be a massively democratizing 
force that can create and expand opportunity, in many ways in 
the same way as us building the interstate highway system or 
creating the transcontinental railroad, which the engine, by 
the way, was built in New Jersey.
    So I want to get right to it. I want to thank you all for 
being here. And a lot of the things that you're going to say 
are wisdoms that we've tried to put together in the DIGIT Act 
that the Senator and I have together with two of our other 
colleagues in a bipartisan fashion.
    But I just want to say welcome to Washington. This is 
really exciting. I don't understand why all the cameras are on 
the other side of the Capitol talking about some place way over 
on the other side of the world, and there isn't more press here 
focusing on this, because this is a panel talking about things 
that are going to change the life of every American in ways 
that they cannot imagine.
    Thank you very much.
    [The prepared statement of Senator Booker follows:]

    Prepared Statement of Cory Booker, U.S. Senator from New Jersey
    Thank you Chairman Fischer for holding this important hearing on 
the potential for advanced technologies, known as the Internet of 
Things, to improve the safety and efficiency of our surface 
transportation systems. In simple terms, the goal of the Internet of 
Things is to create an environment where physical objects--such as 
parking meters, cars, and street lights--can talk to each other so that 
transportation and other systems work better.
    The Internet of Things also promises to make cities smarter in how 
they deliver services to residents.
    As the former Mayor of Newark, New Jersey, I know firsthand that 
our cities face many challenges and that funds are in short supply. The 
vast majority of a city's budget goes to delivering everyday services 
like keeping the street lights on, picking up the trash, and repairing 
aging transportation, water, and energy infrastructure. That's one of 
the reasons why the Internet of Things is so important to me--because 
these technologies can help cities deliver everyday services more 
efficiently and make meaningful improvements to people's quality of 
life.
    For example, in a smart city, the traffic moves more safely and 
efficiently because signals are timed to allow for rapid buses, safer 
bike lanes, and complete streets where pedestrians are not an 
afterthought.
    In a smart city, residents from all economic groups have 
information on all of their transportation options available at their 
fingertips, so they can find the best way to get to work, to job 
interviews, or to new opportunities.
    In a smart city, even everyday infrastructure such as street lamps, 
are equipped not only to efficiently light the way for pedestrians, but 
also to deliver wireless Internet to underserved communities, or to 
monitor air quality or noise pollution in local neighborhoods.
    In a smart city, our ports and freight networks work better because 
advanced communication technologies allow carriers and shippers to 
monitor their shipments to keep supply chains moving.
    All of these exciting visions are enabled by the Internet of 
Things.
    And this great panel of experts before us today can speak firsthand 
about the promise of these innovations, as well as some of the 
challenges that we face in making them happen. To make smart cities a 
reality, technology developers, city governments, and transportation 
companies need an environment that encourages experimentation and 
innovation.
    That's why I--along with Senators Fischer, Ayotte, and Schatz--
introduced bipartisan legislation known as the ``Developing Innovation 
and Growing the Internet of Things'' or DIGIT Act. The DIGIT Act will 
create an environment where innovators have ample access to spectrum 
and Congress has the information necessary to lower the barriers to 
building the Internet of Things. The DIGIT Act is just one of several 
new efforts to challenge cities, companies, and transportation 
providers to work together to make the United States a global leader in 
the Internet of Things.
    For example, the Department of Transportation recently held its 
Smart City Challenge, in which cities from across the country developed 
plans to use this technology to transform their transportation systems. 
Of the 78 cities that took up the challenge, DOT awarded funding to 
seven cities to further hone their plans. In the end, the CITY OF X, 
was awarded $X million to begin implementing their vision for X, Y, and 
Z. However, all of the cities who participated--including my friends in 
Newark and Jersey City--will benefit from having developed actionable 
plans to bring their transportation systems into the 21st Century.
    And that's what this hearing is about--leveraging technology to 
make our transportation infrastructure work better for everyone now, 
and into the future.
    I look forward to hearing from this expert panel about their 
lessons learned so far in developing the Internet of Things in 
transportation, and learning what steps we in Congress should take to 
help foster innovation.
    Senator Fischer--thank you again for having the foresight to call 
this hearing and for being a great partner in encouraging innovation in 
transportation.

    Senator Fischer. Thank you, Senator Booker.
    Don't you just love it when he geeks out?
    No, I am also very excited that we get started. So with 
that, I would like to introduce the panel. We will begin with 
the Honorable Carlos Monje, the Assistant Secretary for 
Transportation Policy at the U.S. Department of Transportation.
    Welcome, sir. If you would like to give your opening 
statement?

       STATEMENT OF HON. CARLOS MONJE, JR., ACTING UNDER

          SECRETARY OF TRANSPORTATION FOR POLICY, AND

         ASSISTANT SECRETARY FOR TRANSPORTATION POLICY,

               U.S. DEPARTMENT OF TRANSPORTATION

    Mr. Monje. Thank you. Chairman Fischer, Ranking Member 
Booker, members of the Subcommittee, thank you for inviting me 
here today.
    We are getting to a point in history where data is as 
important to transportation as asphalt. The Internet of Things 
has the potential to slash commute times, to eliminate traffic 
accidents, reduce CO2 emissions, and reshape 
communities for the better.
    Already, we are beginning to see major advances: connected 
traffic signals that detect cars and pedestrians to improve 
safety and speed traffic; wayfinding applications that let 
commuters pick the most convenient way to get around; and 
sensors that help traffic engineers fix and detect structural 
problems.
    Soon, we are going to see increased deployment of 
technologies that will spread out travel demand and nudge 
travelers to make informed choices. We are going to see 
revolutionized logistics that include robotics, automation, and 
truck platooning.
    Most thrilling, automated vehicles hold the promise to 
dramatically reduce deadly crashes and reclaim millions of 
hours of lost time. The President's Council of Advisors on 
Science and Technology said that the time regained from not 
driving could be worth $1.2 trillion a year, not to mention the 
benefits of reclaiming land from parking spaces.
    While we know that this transformation will be driven by 
the private sector, we are doing our part at U.S. DOT, first by 
building an enabling regulatory environment; second, by never 
wavering from our focus on safety, security, privacy, and 
equity; and third, by investing in key research and tech 
deployments.
    At Secretary Foxx's direction, we are doing everything we 
can to remove regulatory obstacles to provide the certainty and 
flexibility needed to encourage innovation.
    For instance, NHTSA is systematically reviewing its 
regulatory framework, making clear to innovators how to seek 
redress from existing barriers, developing a framework for 
Federal and State regulators to work together, and identifying 
needed new regulatory tools.
    Our Highway Administration is finalizing guidance to road 
planners to how to legally and effectively install vehicle 
infrastructure equipment. The Federal Transit Administration is 
reviewing its rules to enable transit agencies across the 
country to participate in the mobility-on-demand revolution.
    And as the department enters this brave new world, we are 
combining the tools we have with the lessons we've learned, 
starting with a strong partnership with industry and building 
on a foundation of data and transparency.
    We have kept a razor-sharp focus on safety, security, and 
privacy. We are working closely with the FTC, and we are 
pursuing connected vehicles in a way that protects consumers 
from privacy risks and protects vehicles from hacking, 
tampering, or tracking.
    We are also moving aggressively on a number of fronts to 
bolster cybersecurity. NHTSA has challenged the auto industry 
to form an information-sharing and analysis center to 
proactively address cyberthreats. We've collaborated across all 
corners of the Federal Government to give planners the ability 
to capture and manage big data in ways that protect the privacy 
and safety of users.
    We are also investing our dollars in a strategic way to 
fund foundational research, to speed promising technologies to 
market, and to spur the national conversation on the future of 
mobility.
    FTA's Mobility on Demand program includes an $8 million 
sandbox, which is going to help public transit agencies explore 
new ways to partner with emerging service providers, whether 
that be carpooling, transit on-demand, or bike sharing, to 
provide better options to their constituents.
    FHWA is operating three connected vehicles pilots to speed 
truck movements in southern Wyoming, to improve pedestrian 
safety in New York City, and test mobility apps in Tampa. We've 
developed the Freight Advanced Traveler Information System, 
FRATIS, which is demonstrating how sensors and data systems can 
speed the transfer of cargo at the Ports of Los Angeles and 
Long Beach.
    And last week, Secretary Foxx announced the winner of the 
Smart City Challenge, a national competition to transform one 
midsize city using advanced data and technology. Columbus, 
Ohio, will receive $40 million from us, plus a whole lot of 
support from a host of partners, and the city is going to 
deploy electronic self-driving shuttles to connect its 
residents to BRT lines. They're going to put sensors on their 
city fleet to improve safety. They're going to invest in truck 
platooning, and make it easier for delivery vehicles to find 
parking on city streets. And they are integrating their 
transportation data with other parts of their city, 
particularly health care scheduling to help address high rates 
of infant mortality.
    Seventy-eight cities applied. Each created a blueprint for 
the future of transportation on their city streets. And the 
biggest lesson of the Smart City Challenge is that technology 
deployment is not an end to itself, but rather a means to build 
strong communities that create opportunity for all its 
citizens.
    Thank you for the opportunity to discuss the department's 
visions. Thanks also for this subcommittee's leadership in 
holding this hearing and introducing legislation to speed 
planning for the Internet of Things. I'm glad to answer the 
questions you have.
    [The prepared statement of Mr. Monje follows:]

Prepared Statement of Hon. Carlos Monje, Jr., Acting Under Secretary of 
 Transportation for Policy, and Assistant Secretary for Transportation 
               Policy, U.S. Department of Transportation
    Chairman Fischer, Ranking Member Booker, and Members of the 
Subcommittee, thank you for inviting me to appear before you to discuss 
how the Department of Transportation is advancing the Internet of 
Things and its ability to transform communities.
    America has led the world in transportation creativity, from the 
Wright brothers at Kitty Hawk to Ford's Model-T. Today, our ability to 
innovate continues to be the envy of the world. Over time, government 
has played a critical role fostering new innovations--the Global 
Positioning System, the Internet, and the advent of civil aviation are 
just a few examples of how the government has shaped the market in 
revolutionary ways. Over the past seven and a half years, the Obama 
Administration has strengthened our foundation for innovation through 
key investments and critical reforms to drive technological 
breakthroughs that will power our economy and inspire the world for 
generations to come.
    Perhaps no sector better captures the imagination about how 
connectivity can improve the way we move. The potential impacts of 
fully integrated transportation infrastructure are profound. Zero 
transportation fatalities. Drastically reduced commute times. 
Diminished contributions to climate change. We know that over the next 
30 years, America's population will grow by 70 million and the freight 
moving across our roads, rails, pipelines and airports will increase 45 
percent. As a nation, we will not be able to build our way out of the 
growing congestion and all its effects. Instead, we have to be smarter 
about the capacity we have. Emerging technology has the potential to 
dramatically improve our lives.
The Wow Factor
   The next generation of mobility technology is in the early 
        stages of deployment, giving us a glimpse of what is to come.

   Connected traffic signals that detect cars and pedestrians 
        in real time, dramatically reducing risks to pedestrians, wait 
        times at empty intersections, and sharing information with the 
        network to anticipate and speed traffic flows across an entire 
        city or region.

   Wayfinding applications that enable commuters to decide 
        instantly the cheapest and most convenient way to get around, 
        whether by reserving a parking space for their own car, 
        activating a carshare vehicle, signing up for a carpool, biking 
        or using public transit.

   Common payment systems that allow users to travel easily 
        across modes and other solutions to help the unbanked and those 
        without cell phones access these services.

   Connected vehicles that soon will help drivers avoid 
        dangerous situations.

   Sensors that help engineers detect pavement and structural 
        bridge problems and fix them before they become less safe and 
        more expensive to repair; and

   Unmanned aerial vehicles (UAV) that can inspect bridges and 
        pavements, observe on-going construction, and monitor and 
        report traffic incidents.

    In the immediate future, we anticipate seeing the increased 
deployment of technologies and access to data that will:

   help transportation planners better track how their networks 
        perform so they can target their road building, prioritize 
        essential roadway services, evaluate the need for truck parking 
        solutions, and offer more responsive transit services;

   help spread out travel demand and encourage more sustainable 
        choices by informing travelers and freight operators, nudging 
        them to optimize and plan their trip slightly differently;

   help automate freight deliveries with robotic loading and 
        unloading, maximize efficiencies along our freight network--
        including research on the operational and safety impacts of 
        truck platooning;

   provide automated first-and last-mile public transit to 
        encourage transit use and reduce parking needs;

   have the potential to dramatically reduce deadly crashes, 
        cut losses in vehicle and infrastructure damages, and reclaim 
        millions of hours of lost time through the deployment of fully 
        automated vehicles; and

   make transportation projects completely paperless from 
        planning to the post construction phase, saving time and money 
        for State DOTs as well as contractors.

    We know that this transformation will be driven by the private 
sector, and by our state, local and tribal partners, but the Department 
of Transportation is working to speed the benefits of the IoT, first; 
by building an enabling regulatory environment; second, by never 
wavering from our focus on safety, security and privacy; and third, by 
investing in catalytic research and technology deployments.
Finding Innovative Approaches
    As Secretary Foxx has said, DOT is bullish on technology. The 
degree to which we can anticipate breakthroughs, remove obstacles and 
streamline efforts to enable innovation could mean the difference 
between shaping new markets or being subject to them. More than ever, 
transportation innovation can be restricted by the slow pace of 
legislation and rulemaking. Rapidly evolving technology will demand 
government flexibility: regulations may be necessary, but they can also 
provide the certainty to encourage innovation.
    For instance, the National Highway Traffic Safety Administration 
(NHTSA) is systematically reviewing its current regulatory framework to 
identify and overcome any provisions that could slow this 
transformation, including clarifying existing rules, developing a 
framework for Federal and state regulations, and identifying new 
regulatory tools that might be required to meet DOT's safety mission in 
an era of rapidly changing technology. DOT's Volpe Center, on behalf of 
NHTSA recently completed such an evaluation for highly automated 
vehicles and found that, while existing regulations pose few regulatory 
barriers to automated vehicle systems, some design innovations (e.g., 
the elimination of a steering wheel and foot pedals) could complicate 
compliance with current standards. Soon, NHTSA will be unveiling the 
next steps of this framework, which have been informed by our state 
partners and will be fleshed out in partnership with industry.
    In pursuit of a new partnership approach, this past March, NHTSA 
and the Insurance Institute for Highway Safety announced an historic 
commitment by 20 automakers representing more than 99 percent of the 
U.S. auto market to make automatic emergency braking a standard feature 
on nearly all new cars no later than NHTSA's 2022 reporting year. The 
unprecedented commitment means that this important safety technology 
will be available to more consumers more quickly than would be possible 
through the traditional regulatory process.
    One of the most exciting areas that the Department is fully engaged 
in is pushing forward the safe deployment of connected and automated 
safety technologies in vehicles. The Department is leading the way 
forward in integrating both connected and automated vehicle 
technologies in a way that brings the benefits we all hear about. These 
include crash avoidance, reduced energy consumption and vehicle 
emissions, reduced travel times, improved travel time reliability and 
multi-modal connectivity, and improved transportation system efficiency 
and accessibility, particularly for persons with disabilities and the 
growing aging population. For example, the Federal Highway 
Administration (FHWA) is supporting research on systems to make travel 
easier for blind pedestrians and other travelers under the Accessible 
Transportation Technologies Research Initiative (ATTRI). In addition, 
FHWA will issue guidance and technical support tools on how to invest 
in infrastructure that enables the connected systems which will, in 
turn, increase safety, enhance mobility, deliver reliability and cut 
our carbon footprint.
    Another exciting initiative is taking place at the Federal Transit 
Administration (FTA). The agency is administering the Mobility-on-
Demand (MOD) ``Sandbox,'' an effort to bring non-traditional partners 
together to promote enhanced, multimodal mobility concepts using 
advanced technologies and new business models for providing improved 
transportation service. One effect of the Sandbox will be to encourage 
multimodal connectivity and system interoperability so that 
transportation resources are interconnected and accessible to all 
potential users. The FTA understands that the best way to answer the 
question of whether new operational models might work is through real-
world demonstrations that can measure the impacts on regional 
transportation system networks to see what the net benefits to 
travelers and local economies really are. Running these demonstrations 
will also allow the Department to examine how rules and regulations 
impact the implementation of MOD services.
    Still, clear rules of the road that ensure safeguards to protect 
people must be put in place, as government seeks to spur innovation 
without compromising safety and privacy.
Security and Privacy
    The Department has worked hard to support the design and deployment 
of connected vehicle technologies, such as vehicle-to-vehicle (V2V) 
communications, in a manner that protects consumers from unwarranted 
privacy risks and prevents unauthorized access to data. As envisioned, 
the connected vehicle system will contain multiple technical controls 
to help mitigate potential privacy risks and prevent tampering with 
equipment or data. For example, V2V broadcast messages will not contain 
data that identifies the vehicle or its owner. We also are working with 
privacy experts to develop algorithms to sanitize connected vehicle 
data sets, which will enable the Department to make connected vehicle 
data available publicly without putting consumer privacy at risk. Going 
forward, the Department plans to work with the Federal Trade Commission 
and stakeholders to ensure that we develop regulatory strategies and 
guidance in the area of consumer data privacy.
    The Department of Transportation has spent time and resources 
understanding the nature and implications of cyber security. Since 
2012, NHTSA has engaged the potential cyber security threats to 
automobiles through a diverse set of actions. Our approach includes:

   Encouraging the automotive industry to form an Information 
        Sharing and Analysis Center to help the industry proactively 
        and uniformly address cybersecurity threats, while challenging 
        automakers to adopt proactive safety principles and develop 
        best practices that enhance automotive cybersecurity;

   Collaborating proactively with other government agencies--
        including the Defense Advanced Research Projects Agency 
        (DARPA), Department of Homeland Security (DHS), National 
        Institute of Standards and Technology (NIST) and National 
        Science Foundation (NSF)--as well as with vehicle 
        manufacturers, automotive suppliers, and the security research 
        community to protect against cyber threats and potential 
        vulnerabilities; and

   Continuing to execute fundamental research aimed at 
        improving the cybersecurity posture of automobiles with a focus 
        on understanding real-time intrusion detection and response 
        measures. We are also assessing solutions and sharing findings 
        broadly to ensure that once a potential vulnerability or a 
        hacking technique is identified, information about the issue 
        and potential solutions is quickly shared with other 
        stakeholders.

    In expanding the use of drones the Federal Aviation Administration 
(FAA) laid out a responsible path with their Small Unmanned Aircraft 
System (sUAS) rule that is the first set of nationally uniform 
regulations for the commercial, educational and public use of unmanned 
aircraft. Building off the recently released UAS privacy best practices 
developed with industry in a Department of Commerce led 
multistakeholder convening, the Administration is launching a new 
privacy education campaign to encourage pilots, companies and others 
address the privacy implications of these new technologies.
    We also recognize that major advances will be needed in Big Data 
management and analytics, in order to not be overwhelmed by the sheer 
volume of data. To meet this challenge, Secretary Foxx has called on 
all corners of the Department--particularly the Intelligent 
Transportation Systems (ITS) Joint Program Office (JPO)--to focus on 
managing and providing transportation big data to support new paradigms 
of data-driven operations. The ITS-JPO is funding multi-modal 
enterprise data management initiatives focusing on enabling effective 
data capture from ITS-enabled technologies, including connected 
passenger, transit, and commercial vehicles; mobile devices; and 
infrastructure, in ways that protect the privacy of users.
Making Catalyzing Investments
    In addition to the communications programs with which you are 
familiar--the Next Generation Air Traffic Control System (NextGen), V2V 
and vehicle-to-infrastructure (V2I) communications, wireless roadside 
inspections (WRI) for trucks and buses, and Positive Train Control 
(PTC)--we are making key investments that will speed a future in which 
all of our vehicles, road infrastructure, and even pedestrians are more 
safely connected.
    The FTA and ITS-JPO are co-managing the MOD Research Program, 
including grants for the MOD Sandbox initiative to help public transit 
providers adopt new technologies, partner with emerging service 
providers and provide better transportation options to their 
constituents.
    And, the ITS-JPO and FHWA continue to work on the three Connected 
Vehicle Pilot Deployment sites to speed safe and efficient truck 
movement along I-80 in southern Wyoming, improve vehicle flow and 
pedestrian safety in high-priority corridors in New York City, and 
deploy multiple safety and mobility applications on and in proximity to 
reversible freeway lanes in Tampa. The Department continues to 
collaborate with the private sector on the Freight Advanced Traveler 
Information Systems (FRATIS) demonstration project.
    Through a partnership with the Port of Los Angeles, the Port of 
Long Beach and their private sector supply chain operators, FRATIS aims 
to establish a neutral benchmark showing benefits from improved 
operations, including measureable gains in port performance. This 
demonstration project is yielding improved on-time arrival for cargo 
pickup appointments, reduced truck waiting time at port terminals, 
decreased emissions, and improved fuel consumption.
    FHWA also is supporting research on sensor systems that monitor and 
predict structural and pavement conditions. As these systems mature, 
they will aid asset owners in maintaining a state of good repair for 
legacy and new elements of the highway transportation system.
    In December 2015, Secretary Foxx launched the Smart City 
Challenge--a national competition to implement bold, data-driven ideas 
that demonstrate the use of advanced data and intelligent 
transportation systems technologies to make our network safer, easier, 
and more reliable in one mid-sized city. The Department is partnering 
with Paul G. Allen's Vulcan Inc., NXP Semiconductors, Amazon Web 
Services, Mobileye, Autodesk and Alphabet's Sidewalk Labs to provide 
the winning city with up to $40 million plus $10 million from Vulcan, 
and access to multiple technologies to support the Smart City 
demonstration. Perhaps more important, the Smart City Challenge is 
bringing together people, industries and sectors that have rarely 
communicated before, all jointly addressing urban mobility issues in a 
way that is more sustainable, more equitable, and safer than ever 
before.
    Nearly every mid-sized city in America--78 cities--answered the 
call by creating blueprints for the future of transportation today on 
their city streets. The seven finalist cities--Austin, Columbus, 
Denver, Kansas City, Pittsburgh, Portland, and San Francisco--proposed 
first-of-a-kind use of these new technologies to solve the real-world 
challenges facing cities today. From self-driving shuttles that could 
cut in half the commute from underserved neighborhoods to job centers, 
to the use of smart sensors to accelerate freight delivery while 
improving safety. More than 150 diverse industry and non-profit 
partners have pledged more than $500 million in resources, technology 
solutions, and support to help carry out these Smart City plans.

   Austin, TX: The fastest growing city in the Nation with over 
        100 new residents a day, Austin faces unique challenges with 
        growing congestion and increasing commutes. To target the 
        challenges facing its commuters, Austin has proposed to remake 
        the traditional ``park-and-ride'' into a ``one-stop shop'' with 
        even more mobility options, including public transit buses, 
        trains, car share, bike share, automated vehicles, and 
        connected vehicles, to be strategically situated near community 
        health centers, the area community college, housing 
        developments, and the airport.

   Columbus, OH: The city proposed to deploy three electric 
        self-driving shuttles to connect a new bus rapid transit center 
        to a retail district, connecting more residents to jobs, and to 
        use data analytics to improve health care access in a 
        neighborhood that currently has an infant mortality rate four 
        times that of the national average, allowing them to provide 
        improved transportation options to those most in need of 
        prenatal care.

   Denver, CO: Situated at the crossroads of three nationally 
        important freight highways, Denver is applying its pioneering 
        spirit to accelerate freight while improving safety. With 
        partners like FedEx, Peloton, and UPS, Denver is equipping 
        trucks with V2V communication technology to optimize routing 
        and traffic signals and to experiment with connected, 
        autonomous truck platooning, accelerating freight while 
        reducing the impact on low-income neighborhoods that bear the 
        brunt of this traffic flow today.

   Kansas City, MO: Kansas City proposed to revitalize a 
        historically black and underserved community by installing 
        ubiquitous public Wi-Fi along sidewalks and on new electric, 
        connected public buses, including on self-driving shuttles 
        connecting underserved areas with the existing streetcar route. 
        Each bus stop will have large-screen, state-of-the-art kiosks 
        to help residents access transportation information and will be 
        equipped with voice-activated wayfinding technology to help the 
        visually impaired navigate the city's streets.

   Pittsburgh, PA: Pittsburgh is proposing to cut in half the 
        time it takes workers from Hazelwood, a historically 
        underserved community, to reach the city's urban jobs core by 
        partnering with Carnegie Mellon, a pioneer of self-driving 
        technology, to construct a thirty minute loop for autonomous 
        shuttles. Throughout the city, Pittsburgh will also deploy 
        state-of-the-art traffic signal technology--proven to reduce 
        congestion at street lights by forty percent--to significantly 
        reduce travel and idle time for all residents.

   Portland, OR: Portland proposed to launch the Nation's first 
        bulk-buy program for used electric vehicles (EV) to put 
        affordable EVs in the hands of low-income drivers in 
        demonstration corridors and promote electric car sharing and 
        electric bike sharing in low-income communities. At the same 
        time, Portland is partnering on autonomous vehicle 
        demonstrations from campus shuttles and airport buses to self-
        driving taxis and tractor trailers. Portland is also developing 
        a smart housing app with real transparency about the true cost 
        of an apartment, including both rent and transportation costs.

   San Francisco, CA: San Francisco has set a goal of 
        eliminating one out of every ten single occupant car trips by 
        shifting travelers onto carpooling and public transit. To 
        increase uptake of innovative carpooling and ridesharing 
        models, San Francisco envisions a system of new carpooling 
        high-occupancy vehicle (HOV) lanes and reserved curbside pickup 
        areas. In addition, San Francisco has proposed using self-
        driving cars to shuttle passengers for the first and last mile 
        onto public transit. The city, long a leader in innovation, has 
        also proposed sharing its learnings with a tech transfer 
        network of 50 cities and 25,000 transportation professionals.

    While the City of Columbus was named the winner, we are excited to 
see the innovation in their proposals and even more excited that 78 
cities reached out to develop new local and regional partnerships, with 
hundreds of partners beyond those the Department has gathered.
    Through Smart Cities, the Department has also developed new Federal 
relationships--most notably with the Department of Energy's SMART 
Mobility consortium and with NIST's Internet of Things-Enabled Smart 
City Framework- so that we can continue to move forward with the best 
knowledge of new technologies and innovative transportation solutions.
    Altogether, the Department is using its dollars in a strategic way 
to fund primary research, speed promising technologies to market, 
convene unlikely partners at the local level and spur on the national 
conversation on the future of mobility.
Using Technology to Build the Communities We Want
    The biggest lesson of the Smart City Challenge is that technology 
deployment is not an end to itself, but rather a means to build strong 
communities that create opportunity for all of its citizens. The 
Federal Government has focused on the IoT's potential to make our 
national network more efficient, and to make our transportation system 
safer, but the 78 communities that applied to be part of the Smart City 
Challenge each articulated a vision for how connected infrastructure 
and enhanced mobility options will make the lives of their citizens 
better.
    Together, the Smart City applicants are showing us what it means to 
think beyond the traditional transportation modes, and embrace the 
surprising and disruptive innovations coming from the private sector. 
These technological shifts could help increase access to opportunity in 
neglected and underserved communities and meet our environmental 
commitments at the same time.
    As technology continues to advance, the Department, and all levels 
of governance, will need to anticipate, accommodate, and incentivize 
innovation; and to understand and mitigate the risks associated with 
new technologies to ensure that our transportation system remains safe, 
reliable, efficient, equitable and secure.
    Thank you for the opportunity to discuss the Department's vision 
and activities related to the Internet of Things. I am glad to answer 
any questions you may have.

    Senator Fischer. Thank you very much.
    Next, we have Ms. Seleta Reynolds, who is the General 
Manager of the Los Angeles Department of Transportation.
    Welcome.

         STATEMENT OF SELETA REYNOLDS, GENERAL MANAGER,

         LOS ANGELES DEPARTMENT OF TRANSPORTATION; AND

            PRESIDENT, NATIONAL ASSOCIATION OF CITY

                TRANSPORTATION OFFICIALS (NACTO)

    Ms. Reynolds. Thank you. Good morning, Chairwoman Fischer, 
Ranking Member Booker. Thank you so much to you as well as 
Chairman Thune and Ranking Member Nelson for the opportunity to 
come and speak with you today.
    My name is Seleta Reynolds. I am the General Manager of the 
Los Angeles Department of Transportation. I'm also the 
President of the National Association of City Transportation 
Officials, or NACTO.
    I would like to describe where we are, where we are going, 
and the challenges that we face.
    The City of Los Angeles is investing millions of dollars 
into our transportation system to try and evolve our reputation 
as the car capital of the world into the capital of one of the 
most modern sophisticated transportation systems in the world.
    Technology doesn't just change the outcomes in our cities. 
It changes us as well. So it is important for us to stay 
focused on people first, if we want to get to the best and 
brightest outcomes that are possible.
    If we rely solely on the private side, those benefits may 
only land where they benefit the wealthiest among us. Our role 
is to make sure that the rising tide lifts all boats.
    Back in 1984, Los Angeles hosted the Olympics. The hottest 
gadget was the Sony Discman, and we invested in an 
interconnected system of signals called ATSAC that relied on 
algorithms to move cars and people through our streets--in 
fact, more than any other city in the country.
    Today, we rely on painted signs and signals to speak to 
drivers. In the future, that information will go directly to 
the vehicles themselves. These digital interfaces between the 
city's infrastructure and the passengers' vehicles will improve 
the safe flow of people and goods, light and heavy rail, and 
even equestrians across the city.
    More than 2 million people today in Los Angeles are using 
apps to navigate our streets. Earlier this year, we launched a 
Go LA app. This app allows you to choose a cheaper, faster, 
greener way to get from point A to point B. We give sort of a 
level playing field and a mobility marketplace, and let the 
consumer make the choice about how they want to travel around 
our city.
    The next step is to evolve that into a universal payment 
platform where people can actually make that choice, pay for 
that choice, and be on their way all in the palm of their hand.
    We are currently launching electric vehicle car-sharing in 
the heart of our city. While car-sharing markets have evolved 
in some areas, we are deliberately making this accessible to 
people who stand to benefit the most. We are investing public 
dollars to bring in private sector investment.
    City government has a powerful role to play to ensure that 
new services are understandable, legible, and accessible. We 
embed the needs of older adults, people unfamiliar with smart 
phones, or those who don't have bank cards. We partner with 
community groups to help people navigate possible language and 
cultural barriers.
    We are also preparing a pilot of on-demand public transit, 
and requesting funds to upgrade signals and streets to, for 
example, hold a signal at red if it detects a driver about to 
run the light, turn signals green for transit emergency 
vehicles, and alert transit operators to the right speeds to 
get a green wave. And we are requesting proposals to develop 
what we call mobility hubs throughout the city at major transit 
stops to bring car share, bike share, and real-time transit 
information to travelers.
    Our interest is to use technology to treat people with 
hospitality. We want it to be a convener and not a splitter.
    Older technologies are also reemerging in new and 
interesting ways. We are outfitting our city buses with Wi-Fi 
and real-time location updating, and becoming safer and more 
convenient.
    Bicycles are increasingly being electrified and app-ified 
to be an easier, safer, healthier and even more fun way to 
travel--maybe most importantly, a more fun way to travel.
    Signals are becoming smarter to help emergency responders 
in transit be more efficient than ever before.
    I want to underscore that the technologies of today are not 
static, and we don't want to become too wedded to one mode or 
pick winners and losers or ignore the real equity issues that 
we face. Autonomous vehicles may reduce the number of human 
errors occurring, but also have the potential for increased 
traffic, emissions from additional driving, on-street 
congestion, and could be very expensive to own.
    Technologies such as alternative fuels and shared mobility 
will change the funding framework. We hope that we can work 
closely with our partners at U.S. DOT to continue to have a 
conversation about initiative funding and direct aid to cities, 
about realigned and flexible funding, about requiring 
technology to be built into transportation at the most 
fundamental levels, and to pivot from expansion to 
modernization and management. So fixing it first and making our 
infrastructure smarter, rather than continuing to invest in 
expansion.
    Data-sharing is key to us; ongoing investment into mass 
transit like high-capacity rails, because one of the most 
precious resources in cities will continue to be space; and 
preparing our work force.
    As you can see, LA is an exciting place to be right now. We 
know that great cities generate traffic, but traffic doesn't 
generate great cities. Technology has the power to help 
communities achieve their visions, taking back public space 
from congestion, traffic, and parking.
    I want to thank Chairwoman Fischer, Ranking Member Booker, 
and the Committee members for the opportunity to testify. Our 
cities are changing perhaps nowhere as quickly as Los Angeles, 
and we need the Federal Government to work with us on funding, 
standardizing, and exploring the future.
    [The prepared statement of Ms. Reynolds follows:]

  Prepared Statement of Seleta Reynolds, General Manager, Los Angeles 
 Department of Transportation; and President, National Association of 
                 City Transportation Officials (NACTO)
    Good morning Chairman Fischer, Ranking Member Booker and committee 
members.
    I am Seleta Reynolds, General Manager of the Los Angeles Department 
of Transportation. I am also President of the National Association of 
City Transportation Officials, also known as NACTO. It is an honor to 
be here to discuss the Internet of things transportation, at the city 
level. I would like to describe where we are, where we are going, and 
the challenges that we face.
    The City of Los Angeles is investing millions of dollars into 
promoting a modern, multimodal transportation system; to evolve from 
our infamous, 20th Century reputation as the car capital of the U.S. 
toward the most sophisticated, modern transportation system in the 
world. Technology doesn't just change the outcome in our cities and 
country; it changes those who use it as well. We must be smart and 
focused on people first in order to achieve the best of technology's 
entry into transportation.
    From ridesharing to micro-transit, new products emerge daily. 
Therefore, the city is making a home for current, future and evolving 
modes in the mobility marketplace. In the marketplace the city will not 
pick winners or losers, but create an incubator that nurtures the best 
and safest ways to travel. We are not wedded to what exists today, but 
seek to be prepared for what is coming tomorrow. The menu of travel 
options also ensures that should one mode become disabled, travelers 
are not paralyzed.
    Safety, environmental quality, equity, affordability, efficiency 
and quality of life all have benefits to achieve from technology.
    If we rely solely on the private side, these benefits may only land 
where they benefit the wealthiest among us. Our role to play in making 
sure the rising tide lifts all boats.
Yesterday and Today
    Los Angeles made an effective first pass at using technology in 
transportation management in 1984 when it hosted the Summer Olympics. 
In the era of floppy disks L.A. pioneered a system called ATSAC that 
used algorithms to optimize the movement of vehicles through streets. 
Today L.A. is looking to upgrade that network to provide digital 
services to private, commercial, and public vehicles and include 
recommended speeds and safety data. Today we rely solely upon painted 
signs along the streets to tell drivers how fast to drive, tomorrow 
this information will be communicated directly to a vehicle from the 
infrastructure. These digital interfaces between the city's 
infrastructure and the passenger's vehicles will improve the safe flow 
of people and goods, light and heavy rail, and even equestrians across 
the City.
    Today more than 2 million people in L.A. are using apps to navigate 
the streets. Earlier this year we launched a ``Go LA'' app. This app 
shows travelers the many options for moving across Los Angeles 
organized by whether the user is trying to get somewhere faster, 
cheaper, or greener. For example, I can select a destination and be 
provided with detailed options that include walking, biking, transit, 
taxi, TNC and driving information. It may take me 25 minutes to walk, 
but I'll burn 100 calories and it won't cost me a dime. Another option 
presented might be a carpool trip of 5 minutes, $4, 10 pounds of carbon 
emissions, and burning 15 calories. We give all modes an equal 
opportunity and allow the consumer to decide. The next step is to 
provide seamless payment--one way to pay for any transit mode including 
bike share.
    We are currently launching electric vehicle car sharing the heart 
of our city. While car-sharing markets have evolved in some areas, we 
are deliberately making this accessible to people who stand to benefit 
the most. We are investing public dollars and securing private sector 
investment as well. City government has a powerful role to play in 
offsetting risks and promoting investment in traditionally underserved 
or low-income areas. We have an obligation to ensure that new services 
are understandable, legible, and accessible to people. This includes 
considering those that are older, unfamiliar with smartphones, or that 
may not have a bank cards. We also have to partner with community 
groups to help people navigate possible language and cultural barriers.
    We are also preparing a pilot of on-demand public transit and 
requesting funds to upgrade signals and streets to, for example, hold a 
signal at red if it detects a driver about to run the light, turn 
signals green for transit and emergency vehicles, and alert transit 
operators to the right speeds to get a green wave. And we are 
requesting proposals to develop what we call Mobility Hubs throughout 
the city at major transit stops to bring bikeshare, carshare, and real-
time transit information to travelers. Our interest is to use 
technology to treat people with hospitality and convene as many choices 
as possible for them.
    Older technologies are also re-emerging in new and interesting 
ways. City buses are getting Wi-Fi and real-time location updating, as 
well as becoming even safer and more convenient. Bicycles are being 
increasingly electrified and app-ified to be an easier, safer, 
healthier, and even more fun way to travel. Signals are becoming 
smarter to help emergency responders and transit be more efficient than 
ever before.
The Future and the Role of Government
    I would like to underscore that the technologies of today are not 
static nor should we become overly wedded to one mode or ignore very 
real equity issues. For example, autonomous vehicles may reduce the 
number of human errors occurring, but also have the potential for 
increased traffic, emissions from additional driving, on-street 
congestion and could be very expensive to own. Technologies such as 
alternative fuels and shared use mobility will change the funding 
framework. Federal regulators should be encouraged to approach the 
future with these considerations:

   Initiative Funding and Direct Aid to Cities. Direct aid 
        significantly reduces the overhead and administrative costs 
        often associated with Federal funds. We especially appreciate 
        the acknowledgement in recent grants that federalized 
        procurement requirements will slow down rapid pilots and 
        partnerships. U.S. DOT and DOE have been terrific pioneers with 
        the Smart Cities and ARPA-e NEXTCAR programs. These, along with 
        the recommendations from the White House PCAST report published 
        earlier this year on urban development districts, will greatly 
        help American cities move with technology changes. They help 
        cities come to the table to create partnerships with private 
        companies.

   Realigned and Flexible Funding. The tradition of using gas 
        taxes and parking revenues to fund transportation initiatives 
        will become obsolete. Connected autonomous vehicles may not 
        need to park. Electric vehicles don't use gas. Instead, we 
        expect to see digital services provided to users with fees for 
        levels of service. Additionally, new modes like electric 
        powered, shared automated vehicles require regulatory and 
        funding streams that are convoluted under current programs.

   Require tech to be built into transportation at the most 
        fundamental levels. Infrastructure to vehicle communication 
        capability should be required in all transportation 
        construction from Bus Rapid Transit and roads to bike lanes and 
        freeway construction.

   Pivot from expansion to modernization and management to 
        account for the impacts of automated vehicles. Existing roadway 
        space will be used more efficiently through connected 
        technology, making new capacity irrelevant in the near future. 
        Transportation planning at all levels should refocus on 
        modernizing existing expressways with instrumentation for new 
        technology for traffic management. Traffic management will 
        remain a public sector function even in a future dominated by 
        private mobility providers.

   Data sharing: the need for accurate and timely data 
        underlies everything that is changing, especially in the 
        digital world. Our access to the data needed for planning and 
        operating cities is increasingly siloed. The Federal Government 
        can be a strong proponent of open data, data sharing and 
        storage, and, of course, data standards. Data-sharing 
        requirements can substantially reduce the millions of dollars 
        spent annually on technologically primitive data collection, 
        both from regular traffic operation and from traffic crashes.

   Ongoing investment into mass transit like high-capacity 
        rail. One of the most precious resource in cities is space. 
        Even if automation allows us to be more efficient and move more 
        vehicles, we will not have the curb space to accommodate 
        continuous pick-ups and drop-offs. We will always need an urban 
        network for people and possibly, for goods in the future.

   Preparing our workforce--We must proactively give people the 
        skills to be able to consume and understand data and technology 
        for better planning, management and project evaluation.

    As you can see, L.A. is an exciting place to be right now. We are 
on the cutting edge for implementation and regulation of technology in 
infrastructure. We have an important role to play in protecting our 
residents and businesses and to support the mobility marketplace. We 
must be at the table in planning for an increasingly automated future. 
Future visioning for automated vehicles should begin from the inside 
out, from the centers of our economy, looking at land use as well as 
transportation. Theories of automation that focus simply on fitting 
more vehicles into an expressway lane every hour are beginning from the 
product of the economy rather than the motor of the economy. Great 
cities generate traffic; traffic does not generate great cities. 
Technology has the power to help communities achieve their visions both 
for transportation and for land use, taking public space back from 
congestion, traffic and parking.
    I want to again thank Chairman Fischer, Ranking Member Booker and 
the Committee members for the opportunity to testify today. Our cities 
are changing, perhaps nowhere as quickly as Los Angeles, and we need 
the Federal Government to work with us on funding, standardizing, and 
exploring the future.

    Senator Fischer. Thank you very much.
    Next, I'm going to go to Mr. Doug Davis, who is the Senior 
Vice President and General Manager of Intel Corporation. 
Welcome.

  STATEMENT OF DOUG DAVIS, SENIOR VICE PRESIDENT AND GENERAL 
                   MANAGER, INTEL CORPORATION

    Mr. Davis. Good morning, Chairwoman Fischer, Ranking Member 
Booker, and Senator Ayotte. I really appreciate the opportunity 
to be able to testify this morning.
    As head of Intel's IoT group, I am responsible for the 
company's IoT strategy and the underlying technologies, and all 
of that includes transportation and automotive. Intel has been 
delivering integrated or embedded computing for things for over 
35 years. The investment, innovations and standard leadership 
we've driven during that time provide the foundational elements 
of that IoT strategy.
    Intel defines IoT quite simply as devices which are 
securely connected through the network to the data center or 
cloud. And it is the data from these things that can be shared 
and analyzed to solve problems.
    In fact, we believe that security is the foundation of the 
Internet of Things. Our hardware and software are designed from 
the beginning to be secure. We build security into the 
transistors or the way that we design our chips.
    In addition, we build security into the layers of software 
in these things as well as the way in which data is moved from 
those things into the cloud. So we fully realize that safety 
and security are essential for the promise of the Internet of 
Things to be fulfilled.
    Transportation is one of the most promising sectors in the 
IoT. In fact, IDC has projected that global revenue from the 
transportation sector will reach $325 billion just by the year 
2018.
    By converting vast amounts of data into meaningful, 
actionable intelligence, the IoT will help support solutions in 
terms of transportation safety, efficiency, mobility, and some 
of the infrastructure challenges. Indeed, innovations in the 
transportation sector are at the heart of the global race for 
IoT leadership, and that race is really competitive.
    In addition to the U.S., we see self-driving car trials on 
public roads in the U.K., China, Germany, Switzerland, Japan, 
Sweden, South Korea, the Netherlands, and in Dubai, and that is 
just a handful. It's kind of a big handful. But this is a big 
deal for U.S. technology leadership.
    Autonomous vehicles require highly advanced sensors to see 
the things around the car: a variety of technologies to enable 
collision avoidance; powerful in-vehicle computing and 
capabilities to calculate those vehicle trajectories; and 
secure, high-speed ultrareliable connectivity back to the 
advanced data centers of the cloud.
    These autonomous vehicles must become the ultimate learning 
machines. They are going to need to be able to make smarter and 
safer decisions than even the most skilled human driver.
    In fact, cars will become known as data centers on wheels. 
And in order for this to occur, these autonomous and 5G 
technologies will evolve at the pace of innovation, because 
they are going to have vast global industry support and rapid 
marketplace adoption.
    Autonomous vehicles will also improve our efficiency and 
productivity, as I think has already been mentioned a few 
times. The average American commuter spends 38 hours per year 
stuck in traffic, which collectively costs the U.S. economy 
about $121 billion per year in just wasted time and fuel.
    The U.S. freight transportation industry alone could save 
$168 billion per year in fuel reduction, not to mention the 
benefit in reducing harmful emissions.
    For the U.S. to lead the world in IoT transportation and 
capture these vast economic and societal benefits that a 
modernized transportation infrastructure, autonomous vehicles, 
and 5G connectivity will deliver, Intel recommends that 
policymakers collaborate with the high-tech and transportation 
industries to develop an ambitious national IoT transportation 
strategy based on five principles. Number one, prioritize 
safety to reduce the number and severity of crashes. Number 
two, prioritize security from the outset. Three, promote 
technology neutrality by relying on marketplace innovation and 
competition. Encourage open, global standards based on 
transportation platforms to enable a commercialization path 
that is scalable, interoperable, and reusable across 
deployments. And then finally, number five, invest in public-
private partnerships. That will help launch and scale future 
looking transportation testbeds, especially in areas like 5G, 
to develop trusted data and secure computing, machine learning, 
open standards, and, of course, security.
    So I want to thank you for this opportunity to share 
Intel's policy recommendations for a U.S. IoT transportation 
leadership, and I look forward to questions a little bit later.
    [The prepared statement of Mr. Davis follows:]

        Prepared Statement of Doug Davis, Senior Vice President 
                 and General Manager, Intel Corporation
    Intel Corporation (Intel) respectfully submits this statement for 
the record in conjunction with the Senate Commerce, Science & 
Transportation Committee, Surface Transportation and Merchant Marine 
Infrastructure, Safety and Security Subcommittee, hearing on ``How the 
Internet of Things (IoT) Can Bring U.S. Transportation and 
Infrastructure into the 21st Century.'' Our statement focuses on the 
opportunity to unleash the enormous potential of the IoT to enable 
vastly improved transportation safety, mobility and efficiency--and, in 
doing so, seize a leadership opportunity for the U.S. by ensuring that 
the Nation's intelligent transportation technology evolves at the 
forefront of innovation.
    Witness: Doug Davis is the Senior Vice President and General 
Manager of Intel's worldwide IoT Group (IoTG). Doug has been an Intel 
employee for 32 years, and began his career as a product engineer in 
the company's Military and Special Products Division. Over the last 
decade, Doug has run Intel's worldwide Embedded and Communications 
Group, managed wafer factory operations, and now leads the IoT Group. 
This organization is responsible for the company's IoT strategy and 
solutions--consisting of hardware, software, security and services 
across a wide range of market segments, including transportation, 
manufacturing, healthcare, retail, smart home, smart buildings and 
smart cities. For more than 30 years, Intel has made significant 
investments, driven exciting innovations, led standards activities, and 
supported what has evolved to become the IoT. At Intel, we like to say 
that the IoT is an overnight transformation thirty years in the making.
Background
    The Internet of Things. At its simplest, the IoT is: ``Things'' 
(devices) securely connected through a network to the cloud 
(datacenter), from which data can be shared and analyzed to create 
value (solve problems). The IoT enables us to connect ``things'' like 
phones, appliances, machinery and cars to the Internet, share and 
analyze the data generated by these things, and extract meaningful 
insights that create new opportunities and solve problems. These 
opportunities are extensive and exciting with the ability to transform 
entire industries and our lives for the better. The IoT encompasses two 
major segments: Consumer IoT and Industrial IoT. The ``Consumer IoT'' 
connects devices like game consoles, smart TVs, household appliances, 
wearables and smart phones. The ``Industrial IoT'' connects devices in 
industrial environments like factory equipment, security cameras, 
medical devices and digital signs.
    Transportation is one of the most promising sectors for the IoT. By 
converting vast amounts of data into meaningful and actionable 
intelligence, the IoT can help solve many of modern society's 
automotive safety, transportation efficiency, mobility, and 
infrastructure challenges. The IoT is rapidly enabling innovations like 
connected cars, ``smart'' fleet management, intelligent transportation 
infrastructure and, of course, self-driving (autonomous) cars. Notably, 
almost half of Americans aspire to live in a driverless city where 
cars, buses, and trains operate intelligently and automatically without 
people driving them, and over one-third expect a driverless city by 
2024.\1\ A policy framework that harnesses the full potential of these 
transformational IoT opportunities in the automotive and transportation 
sector is critical to U.S. economic leadership and productivity in the 
21st century.
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    \1\ The Vote Is In, Intel Corp. (Feb. 2014), http://
newsroom.intel.com/community/intel_news
room/blog/2014/02/10/the-vote-is-in-citizens-support-smart-cities-with-
driverless-cars-public-ser
vice-drones-and-surroundings-that-sense-activities.
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    Intel Leadership in IoT Transportation. As an IoT leader, Intel is 
committed to driving innovation across all market sectors, with a 
significant focus on IoT transportation. We are collaborating with 
policymakers, automakers, suppliers, academia, and cities worldwide--
utilizing the IoT to accelerate innovation. Intel is collaborating with 
our automotive industry partners and governments that seek to not only 
reimagine the car, but also restructure the idea of transportation as a 
whole.
    To realize the full potential of this new vision, industry must 
undertake the appropriate and comprehensive testing to ensure that all 
systems operate flawlessly. Consequently, Intel is building Centers of 
Excellence (CoEs) to road test autonomous vehicles in our home states 
of Arizona, California, Oregon and California, as well as Germany.\2\ 
Working with the automotive industry, our CoEs will enable improvements 
in AV development by gathering data needed to build the machine 
learning models that will provide the intelligence for these vehicles. 
We're focusing on what it will take to realize safe, secure, fully 
autonomous driving, and for vehicles to reliably communicate with each 
other and the world around them. We are exploring how valuable data can 
bring new services to market and how smart human-machine interfaces can 
make autonomous driving intuitive and enjoyable.
---------------------------------------------------------------------------
    \2\ Intel Labs: http://www.intel.eu/content/www/eu/en/research/
intel-labs-europe.html
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    For example, we are partnering with automakers to enable platforms 
with fundamental advanced driver assist features like lane-keeping 
assistance, collision warning, and automated parking assist,\3\ which 
are early capabilities on the path to self-driving cars.\4\ We also are 
helping businesses use IoT technology to optimize fleet management and 
freight transport, using real-time data analytics to make drivers safer 
and more efficient while reducing fuel consumption. We are also 
partnering with city governments to deliver cutting-edge IoT 
transportation infrastructure solutions like intelligent traffic 
management (using advanced data analytics to enable integrated 
transportation coordination, emergency traffic response, and congestion 
reduction)\5\ and enhanced public transportation experiences (using 
real-time interactive digital signage to make multi-modal transit 
easier and more engaging for citizens).\6\
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    \3\ ADAS Demo: http://www.intel.com/content/www/us/en/automotive/
advanced-driver-assistance-systems-video.html
    \4\ Self-Driving Car Technology and Computing Requirements, Intel 
Corp. http://www.intel.com/content/www/us/en/automotive/driving-safety-
advanced-driver-assistance-systems-self-driving-technology-paper.html.
    \5\ Intelligent Traffic Management: https://www.youtube.com/
watch?v=M0ZN8El6lfY
    \6\ Real-Time Interactive Transit Displays: http://www.intel.com/
content/www/us/en/intelligent-systems/tech-today/transportation-
digital-signage-video.html.
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    Intel's Vision for IoT in Transportation. Intel's vision for the 
future of transportation is one of zero accidents, mobility for all, 
environmental sustainability, reduced congestion, increased efficiency 
and innovation that evolves at the pace of technology to ensure U.S. 
global leadership. We are making large investments \7\ to enable a 
future of autonomous vehicles with highly advanced sensors; connected 
cars using advanced cellular technology like 5G (5th generation 
cellular) for real-time vehicle-to-vehicle (V2V) collision avoidance; 
powerful in-vehicle computing capabilities to deliver driver strategy 
and trajectory computing and self-driving capabilities; and secure, 
high-speed, ultra-reliable communications with advanced data centers in 
the cloud. All of this will be driven by the IoT and will transform our 
lives and economies for the better.
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    \7\ Intel Bulking Up Safety and Security of Self-Driving Car 
Efforts, Fortune (April 2016) (``Intel Self-Driving Car investments''), 
http://fortune.com/2016/04/05/intel-self-driving-car/.
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    With the advent of new business models like transportation-as-a-
service and the growth of the car sharing economy, the transportation 
sector is poised to make the leap from technologies and business models 
grounded in the 20th Century to exciting and empowering technologies 
firmly anchored in the 21st Century. To successfully compete in the 
forward-looking global economy, U.S. policymakers must enable a 
transportation ecosystem that is safe, secure, flexible and 
interoperable. Global leadership will accrue to those markets that 
address these goals in the most efficient manner possible.
    The challenges for the stakeholder industries are numerous. For 
example, industry must profitably transition from its current legacy 
business models to business models that focus less on the human as a 
``driver.'' Technology industry suppliers also must pivot to 
intelligently utilize increasing amounts of data, while addressing the 
needs of two vastly different generations of consumers--baby boomers 
who want to maintain mobility and millennials who are challenging the 
status quo of vehicle ownership. We must adapt as new technologies 
become the foundation of our transportation ecosystem.
    Of particular importance to the stakeholder industries will be how 
the U.S. Government addresses some of the key foundational technologies 
that will serve as the core architecture for future capabilities. Most 
significantly, policymakers should be aware that it is widely expected 
that 5G cellular (the rapidly emerging successor to today's 4G) will be 
a foundational technology for the IoT overall and critical to the 
success of IoT in transportation. For the U.S. to lead in the global 
IoT transportation future, it is vital that the Nation's transportation 
strategy recognizes the global marketplace direction and enormous 
global industry investment in 5G--and that the U.S. pragmatically 
invest its own limited Federal resources in 5G to keep pace with the 
transportation industry worldwide.
    So what do we mean by 5G, how does it impact the transportation 
sector specifically, and why does it matter so much? Advanced cellular 
communications such as next generation 5G technology offer uniquely 
superior characteristics that are critical for V2V real-time collision 
avoidance: very low latency (especially in dense vehicle 
environments),\8\ ultra-high reliability, consistent safety 
prioritization,\9\ very high speeds, advanced security, and cost 
effectiveness to enable scale--and therefore many more saved lives. 
This next generation of cellular also will have the backing of huge 
global private industry investment and strong consumer demand which 
propels technologies to the forefront and enables them to evolve at the 
pace of innovation, which will be key for the long term evolution of 
IoT solutions.
---------------------------------------------------------------------------
    \8\ Letter Report: Review of the Status of the Dedicated Short-
Range Communications Technology and Applications [Draft] Report to 
Congress, TRB at 5-6 (April 2015), http://onlinepubs.trb.org/
onlinepubs/reports/DSRC_April_28_2015.pdf.
    \9\ 5G provides reliable safety prioritization by optimally 
managing both the communication channel and the prioritization of 
safety information through the network, while supporting a highly 
scalable broadcast mechanism for vehicles.
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    Evidence of the global race to secure leadership in this space is 
everywhere and should be viewed by U.S. policymakers as both a wakeup 
call as well as a challenge to move intelligently and swiftly. Leading 
examples include 5G deployments that are underway for the 2018 FIFA 
World Cup in Russia \10\ and the 2018 Winter Olympics in PyeongChang, 
South Korea,\11\ followed by the 2020 Summer Olympics in Tokyo, 
Japan.\12\ Moreover, 5G transportation use cases--and specifically V2V 
safety real-time collision avoidance--already have been demonstrated in 
major countries, with more following suit this year. For example, 
Japanese mobile operator NTT DOCOMO (along with Nokia, Samsung, 
Ericsson, Fujitsu and Huawei) successfully conducted 5G vehicle trials 
in actual-use environments in 2015.\13\ Also in 2015, Deutsche Telecom 
(along with Continental, Fraunhofer ESK, and Nokia) successfully 
demonstrated ``near-5G'' communication between vehicles via the 
cellular LTE network on the `Autobahn A9 motorway testbed' in 
Germany.\14\ And Korean mobile operator KT plans to conduct early 5G 
trials and commercialization between 2016 and 2018.\15\ Clearly, the 
race is on and it's a crowded field.
---------------------------------------------------------------------------
    \10\ Huawei to introduce 5G networks for 2018 FIFA World Cup (Nov. 
2014), http://www.trustedreviews.com/news/huawei-to-introduce-5g-
networks-for-2018-fifa-world-cup.
    \11\ PyeongChang 2108, the ``5G Olympics'' Korea Info. Soc. (April 
2016), http://www.koreainformationsociety.com/2016/04/pyeongchang-2018-
5g-olympics.html.
    \12\ Nokia, NTT DoCoMo prepare for 5G ahead of 2020 launch, Reuters 
(2015), http://www.reuters.com/article/us-telecoms-mwc-ntt-docomo-
idUSKBN0LY0FD20150302
    \13\ DOCOMO Successfully Conducts 5G Trials in Actual-use 
Environments (2015), https://www.nttdocomo.co.jp/english/info/
media_center/pr/2015/1126_00.html.
    \14\ Continental, Deutsche Telekom, Fraunhofer ESK, and Nokia 
Networks Showcase First Safety Applications at ``digital A9 motorway 
test bed'' (2015): https://www.telekom.com/media/company/293064
    \15\ SK Telecom announces the foundation of 5G Open Trial 
Specification Alliance with NTTDOCOMO, Verizon and KT (2016): http://
www.sktelecom.com/en/press/detail.do?idx=1156
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Why Congress Should Care: The Societal and Economic Impact of IoT in 
        Transportation
    So why should policymakers care and why should they spend so much 
time making sure the benefits are realized in a way that enables 
technology in the U.S. to keep pace with global marketplace innovation? 
The potential impact of IoT technology to address important societal 
and economic challenges in the automotive and transportation sector is 
remarkable, compelling and exciting. The benefits that will flow from 
broad deployment of IoT technology in transportation is what energizes 
our team at Intel, and we are optimistic that enthusiasm will be 
contagious here in Congress.
    The following is a summary of some of the many benefits of smart 
utilization of the IoT that have been identified for the transportation 
ecosystem:

    Safety and Economic Savings. Improved vehicle safety is, and will 
remain, the consistent top priority and foundation for Intel's IoT 
transportation efforts. The statistics with respect to preventable 
automobile accidents are devastating. Every year, more than 30,000 
people in the U.S. die from preventable automobile accidents,\16\ and 
human error is the primary reason for over 90 percent of U.S. 
crashes.\17\ An EU study found that distracted and drowsy driving were 
responsible for 13 percent of traffic deaths in 2014.\18\ These 
accidents take an enormous emotional and physical toll on the driving 
public and their loved ones, at a cost of approximately 300,000 lives 
each decade in the U.S. and a cost of $190 billion each year in 
healthcare costs associated with accidents.\19\
---------------------------------------------------------------------------
    \16\ Mortality--Motor Vehicle Traffic Deaths, CDC, http://
www.cdc.gov/nchs/fastats/injury.htm (site last visited June 26, 2016).
    \17\ Driverless cars could reduce traffic fatalities by up to 90 
percent, says report, Science Alert (``Science Alert''), http://
www.sciencealert.com/driverless-cars-could-reduce-traffic-fatalities-
by-up-to-90-says-report; National Motor Vehicle Crash Causation Survey, 
U.S. Dept. of Transportation, at 25 (2008), http://
wwwnrd.nhtsa.dot.gov/pubs/811059.pdf.
    \18\ Autonomous cars--game-changers for safety?, FANCI (Jan. 2016), 
http://fanci-project.eu/autonomous-vehicles-changer/
    \19\ Science Alert.
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    Self-driving vehicles--where the vehicle senses its environment and 
navigates without human input--are widely expected to dramatically 
reduce crashes:

    If only 10 percent of vehicles were self-driving:

   US traffic deaths could decrease by 1,100; and

   save almost $38 billion per year.

    If 90 percent of vehicles were self-driving:

   traffic deaths could decrease by 21,700; and

   save $447 billion per year.\20\
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    \20\ Preparing a Nation for Autonomous Vehicles: Opportunities, 
Barriers and Policy Recommendations, Eno Center for Transportation, at 
8 (Oct. 2013), https://www.enotrans.org/wp-content/uploads/wpsc/
downloadables/AV-paper.pdf.
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    And, when 100 percent of vehicles are self-driving, the U.S. could 
save $1.3 trillion per year.\21\
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    \21\ The `Internet of Things' Is Now Connecting the Real Economy, 
Morgan Stanley (April 2014), http://www.technologyinvestor.com/wp-
content/uploads/2014/09/internet-of-Things-2.pdf. Specifically, $488B 
savings from accident avoidance, $507B productivity gain from 
autonomous cars, $158B fuel savings, $138B productivity gain from 
congestion avoidance, and $11B fuel savings from congestion avoidance.
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    McKinsey similarly projects that autonomous vehicles could 
drastically reduce accidents, including reducing the lethality of 
vehicle crashes in the U.S. from second to ninth amongst accident 
types. They estimate that this would reduce the annual cost of roadway 
crashes in the U.S. from $212 billion to $22 billion--a cost savings of 
nearly 90 percent per year.\22\
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    \22\ Ten ways autonomous driving could redefine the automotive 
world, McKinsey & Co., (June 2015), http://www.mckinsey.com/industries/
automotive-and-assembly/our-insights/ten-ways-autonomous-driving-could-
redefine-the-automotive-world.
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    Efficiency and Productivity. According to the United States Census 
Bureau, the average American commute to work is 25.4 minutes, and 
Americans spend 157 hours per person each year traveling on the 
Nation's roads and highways.\23\ Moreover, the average American 
commuter spends 38 hours per year stuck in traffic, which collectively 
causes urban Americans to travel 5.5 billion more hours and purchase an 
extra 2.9 billion gallons of fuel; the cost to the U.S. economy of this 
wasted time and fuel is $121 billion per year.\24\ IoT technologies 
like self-driving vehicles (where citizens can engage in productive 
activity while in transit) and more intelligent transportation 
infrastructure (with better traffic management) could enable a far more 
productive and efficient U.S. citizenry.
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    \23\ Commuting in the United States 2009, US Census Bureau (Sept. 
2011), https://www.census.gov/prod/2011pubs/acs-15.pdf
    \24\ The American Commuter Spends 38 Hours a Year Stuck in Traffic, 
The Atlantic (Feb. 2013), http://www.theatlantic.com/business/archive/
2013/02/the-american-commuter-spends-38-hours-a-year-stuck-in-traffic/
272905/. See also The Massive Economic Benefits Of Self-Driving Cars, 
Forbes (Nov. 2014) (estimating the savings could go up to $500B/year),  
http://www.forbes.com/sites/modeledbehavior/2014/11/08/the-massive-
economic-benefits-of-self-driving-cars/#6bb4e79e68d9.
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    And for making our lives better, autonomous vehicles could free as 
much as 50 minutes a day for users, who will be able to spend traveling 
time working, relaxing, or accessing entertainment. The time saved by 
commuters every day might add up globally to a mind-blowing one billion 
hours--equivalent to twice the time it took to build the Great Pyramid 
of Giza. It could also create a large pool of value, potentially 
generating global digital-media revenues of €5 billion (over $5.5 
trillion USD) per year for every additional minute people spend on the 
mobile Internet while in a car.50
    Reduced traffic congestion. Traffic congestion continues to have 
significant impacts on urban design, land usage, and overall time usage 
for travelers whether for work or pleasure. This issue is in large part 
based on the need for vehicle parking. In a recent study, the 
Transportation Alternatives group found that in one Brooklyn 
neighborhood, 64 percent of the local cars were on local roads merely 
because they were searching for a parking spot.\25\ Autonomous vehicles 
would change that by self-parking themselves in less congested areas 
and therefore enable city planners and developers the flexibility to 
reshape and improve how we use land in cities. According to Rowe,\26\ 
one of the most profound effects of driverless vehicles would be to 
drastically reduce the need for parking structures and surface lots, 
which today take up a third of land inside cities. Some of the garages 
and underground structures could be converted into storage spaces for 
urban dwellers who live in micro units, while the unneeded surface lots 
would be available for commercial or residential development or green 
space.
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    \25\ How Driverless Cars Could Turn Parking Lots into City Parks, 
The Atlantic (Aug. 2015), http://www.theatlantic.com/technology/
archive/2015/08/driverless-cars-robot-cabs-parking-traffic/400526/
    \26\ Imagining the Driverless City, Urban Land Magazine (Oct. 
2015), http://urbanland.uli.org/infrastructure-transit/imagining-
driverless-city/
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    New mobility options for the disabled and elderly. Nearly 15 
million people across the U.S., including 6 million disabled 
individuals, have challenges getting the transportation they need on a 
daily basis.\27\ These individuals often become dependent on family 
members or must resort to costly modes of transportation in order to 
travel around their communities for business, medical and social 
activities. Autonomous vehicles--because they do not require a human 
driver--can open up better transportation and mobility options for 
these individuals. This will both increase their individual quality of 
life, as well as improve our overall society. Indeed, ``without access 
to transportation, people with disabilities will not be part of 
society's economic environment and will continue to be alienated from 
the economic mainstream, thus causing a myriad of other problems, like 
homelessness and institutionalization.'' \28\
---------------------------------------------------------------------------
    \27\ Transportation Difficulties Keep over Half a Million Disabled 
at Home, USDOT Bureau of Transportation Statistics (2003), http://
www.rita.dot.gov/bts/sites/rita.dot.gov.bts/files/publications/
special_reports_and_issue_briefs/issue_briefs/number_03/html/
entire.html.
    \28\ Facts about Equity in Transportation for People with 
Disabilities, The Leadership Conference on Civil and Human Rights (site 
last visited 6/25/16) http://www.civilrights.org/transportation/
disability/facts.html.
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    Revenue and Growth. The automotive and transportation industries 
will be among the first to see immediate growth from the IoT, with 
global IoT revenue from the transportation sector reaching $325 billion 
in 2018.\29\ With almost nine percent of the U.S. labor force employed 
in the transportation sector \30\ and the U.S. spending roughly $160 
billion annually on highway infrastructure (about one-fourth funded by 
the Federal Government) \31\--America's share of this transportation 
IoT revenue (and cost savings from IoT technologies) could be 
significant.
---------------------------------------------------------------------------
    \29\  Roundup of Internet of Things Forecasts And Market Estimates, 
2015, Forbes (citing IDC) (Dec. 2015), http://www.forbes.com/sites/
louiscolumbus/2015/12/27/roundup-of-internet-of-things-forecasts-and-
market-estimates-2015/2/#3060c5e34a10.
    \30\ National Transportation Statistics, U.S. Dept. of 
Transportation, Table 3-23 (July 2013), http://www.rita.dot.gov/bts/
sites/rita.dot.gov.bts/files/publications/
national_transportation_statistics/html/table_03_23.html.
    \31\ Statement of Joseph Kile, Before the U.S. Senate Cmte. on 
Finance, The Highway Trust Fund and Paying for Highways (May 17, 2011), 
http://www.cbo.gov/sites/default/files/cbofiles/ftpdocs/121xx/doc12173/
05-17-highwayfunding.pdf.
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    Fuel savings and reduction in harmful emissions. Experts such as 
former GM executive Larry Burns, believe driverless trucks could reduce 
costs in the line-haul trucking industry by 40 percent. By switching 
from traditional car ownership models to a shared driverless model, the 
costs of car ownership (based on U.S. modelling) could fall from $0.70 
per mile to around $0.15 per mile--a 78 percent reduction.\32\ Notably, 
the potential savings to the U.S. freight transportation industry 
alone--one of the most compelling use cases for self-driving vehicles--
is estimated at $168 billion per year.\33\
---------------------------------------------------------------------------
    \32\ Accenture Digital at 4.
    \33\ Id. Specifically, savings from labor ($70B), fuel efficiency 
($35B), productivity ($27B), and accident savings ($36B).
---------------------------------------------------------------------------
    First Responders. Another important benefit of mass adoption of 
autonomous vehicles could have a huge impact for first responders and 
thus the public at large. With access to driverless vehicles, emergency 
services could collaborate with analytics providers to improve response 
times and elevate the level of healthcare provided to residents while 
potentially lowering costs.\34\
---------------------------------------------------------------------------
    \34\ ``The new road to the future Realising the benefits of 
autonomous vehicles in Australia,'' Accenture Digital at 10 (2014) 
(``Accenture Digital''), https://www.accenture.com/t00010101
T000000_w_/au-en/_acnmedia/Accenture/Conversion-Assets/DotCom/
Documents/Local/en-gb/PDF_3/Accenture-Realising-Benefits-Autonomous-
Vehicles-Australia.pdf
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Global Trends
    But the U.S. is not alone in wanting to realize those benefits. We 
see a number of initiatives globally that will shape the evolution of 
technologies, industrial capabilities, and environmental infrastructure 
for autonomous vehicles to become a mainstream capability that this 
Committee should note as it develops its own IoT transportation vision 
for the U.S. A review of what is being done globally must be an 
essential component of your deliberations and the following may help 
illuminate some of the key activities that merit attention.
    Country Investments in Autonomous Vehicles. The race to an 
autonomous vehicle world is a global one. It is important for Congress 
to appreciate not only the amount of funding other countries are 
investing in IoT transportation, but most importantly the future proof 
technologies in which they are investing. In short, they are largely 
investing in AV technologies and 5G connectivity--both of which are 
widely expected to achieve rapid and widespread voluntary adoption 
worldwide. If America seeks to lead the world in IoT transportation, 
policymakers may find interesting the countries large and strategic 
investments that other countries are making to drive a successful IoT 
transportation future and keep pace with innovation for years to come.

   China's search giant, Baidu, has partnered with BMW and 
        released a semi-autonomous vehicle prototype, and has tested 
        their technologies on highways in China. The semi-autonomous 
        vehicle is a modified 3-Series BMW that drove an 18.6-mile 
        route around Beijing.\35\
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    \35\ China's roadmap to self-driving cars, Fortune (April 2016), 
http://fortune.com/2016/04/23/china-self-driving-cars/?iid=sr-link2; 
Inside China's Plan to Beat America to the Self-Driving Car, Wired 
(June 2016), https://www.wired.com/2016/06/chinas-plan-first-country-
self-driving-cars/

   Japan is investing in a multimillion dollar research center, 
        called the National Innovation Complex, opened at Nagoya 
        University last year. A key project is to develop self-driving 
        car technology.\36\
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    \36\ Scania to test Ericsson 5G for V2X applications, Safe Car News 
(May 2016), http://safecarnews.com/scania-to-test-ericsson-5g-for-v2x-
applications-ma7311/

   Germany's Chancellor Merkel told carmakers that they should 
        soon be able to test self-driving vehicles on German roads by 
        promising to remove legal barriers.18 The stretch on 
        the A9 autobahn--which links Munich and Berlin--will give the 
        industry the opportunity to ``test and optimize new innovations 
        in an adapted infrastructure that offers data connections and 
---------------------------------------------------------------------------
        measuring tools.19

   Sweden is sponsoring a large-scale trial of 100 Volvo 
        driverless cars to begin on the public roads of Gothenburg in 
        2017. This pilot is part of the Swedish government's vision of 
        zero traffic fatalities, and will give insights into the 
        technological challenges at the same time as receiving valuable 
        feedback from real customers driving on public 
        roads.17

   Korea. The Korean government has pledged 145.5 billion won 
        ($127.7 million USD) to develop key technologies for self-
        driving cars in hopes of beating out global competitors, 
        including leading IT companies, beginning in 2017.\37\
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    \37\ Gov't pledges 145.5 billion won for self-driving technology, 
Korea Joon Gang Daily (April 2016), http://
koreajoongangdaily.joins.com/news/article/Article.aspx?aid=3018172

   The UK announced 20 million (over $27 million 
        USD) of its 100 million Intelligent Mobility Fund 
        will be invested in autonomous vehicle advancement, including 
        current trials to test driverless cars on the streets of 
        Bristol, Coventry and Milton Keynes, and Greenwich, and 
        developing autonomous shuttles to carry visually-impaired 
        passengers using advanced sensors and control systems.\38\
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    \38\ Driverless car technology receives £20 million boost 
(Feb. 2016), https://www.gov.uk/government/news/driverless-cars-
technology-receives-20-million-boost; Driverless cars to be tested on 
UK motorways in 2017, Wired.uk (March 2016) http://www.wired.co.uk/
article/budget-support-driverless-car-trials-uk-motorways-2017.

    A review of what the auto industry has undertaken to date also is 
vital for your strategic planning. Again, we see advancements occurring 
---------------------------------------------------------------------------
worldwide:

    Status of Autonomous Vehicles. Both traditional automakers and new 
automotive innovators are racing to deliver a self-driving vehicle 
world--largely predicting mainstream autonomous vehicles on market by 
or before 2020.\39\
---------------------------------------------------------------------------
    \39\ Driverless car market: Gearing up to save lives, reduce costs, 
resource consumption (``Self-Driving Forecast''), http://
www.driverless-future.com/?page_id=384 (site last visited 6/22/16).
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Highly Autonomous Cars on Market Today
   2015 Infiniti Q50S: Intelligent Cruise Control, Predictive 
        Forward Collision Warning, Forward Emergency Braking, Lane 
        Departure Warning/Prevention, Active Lane Control

   2015 Mercedes-Benz S65 AMG Coupe: Distronic Plus with 
        Steering Assist, Adaptive Brake Technology, Active Lane-Keeping 
        Assist

   2016 Tesla Model S P85D/P90D: Autopilot, Autosteer, Auto 
        Lane Change, Autopark, Traffic-Aware Cruise Control

   2016 Volvo XC90 T6/T8 Hybrid: Intellisafe Autopilot

   2016 Honda Civic: Semi-autonomous ADAS

   2016 BMW 750i xDrive: Driver Assistance Plus, Active Driving 
        Assistant Plus
Near-Term Highly Autonomous Prototypes
   Lexus GS 450h: Intelligent Safety Concept

   Faraday Future FFZERO1 EV Concept: Self-driving, almost 
        fully autonomous

   Audi RS7: Driving Concept Car

   Acura RLX Sedan: Self-Driving Prototype
Fully Autonomous Cars 2017-2021
   Audi expects its A8 to be capable of fully autonomous 
        driving next year in 2017.\40\
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    \40\ Next-gen Audi A8 drives better than you, Motoring (Oct. 2014), 
http://www.motoring
.com.au/next-gen-audi-a8-drives-better-than-you-46963/.

   Volvo pledged no accidents in its cars by 2020 due to 
        autonomous technology \41\ and announced a 100-car public trial 
        with Swedish authorities where members of public will be behind 
        wheel.\42\
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    \41\ Volvo's 2020 pledge: No one will die in our cars, CS Monitor/
AP (Jan. 2016), http://www.csmonitor.com/Technology/2016/0121/Volvo-s-
2020-pledge-No-one-will-die-in-our-cars
    \42\ Volvo to test autonomous cars with ordinary drivers on public 
roads by 2017, The Guardian (Feb. 2015), https://www.theguardian.com/
technology/2015/feb/24/volvo-test-autonomous-cars-ordinary-drivers-
public-roads-by-2017

   Google plans to have its driverless cars on the market no 
        later than 2018.\43\
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    \43\ Sergey Brin on driverless car future, Driverless Car Market 
Watch (Oct. 2012), http://www.driverless-future.com/?p=323

   Tesla Founder expects first fully autonomous Tesla vehicles 
        by 2018.\44\
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    \44\ Elon Musk Says Tesla Vehicles Will Drive Themselves in Two 
Years, Fortune (Dec. 2015), http://fortune.com/2015/12/21/elon-musk-
interview/

   Baidu expects a large number of self-driving cars on the 
        road by 2019, with mass-production in full swing by 2021.\45\
---------------------------------------------------------------------------
    \45\ China's Baidu Could Beat Google to Self-Driving Car with BMW, 
The Guardian (June 2015), https://www.theguardian.com/technology/2015/
jun/10/baidu-could-beat-google-self-driving-car-bmw.

   Volkswagen expects the first self-driving cars to appear on 
        the market by 2019.\46\
---------------------------------------------------------------------------
    \46\ Self-Driving Forecast; see also Die Zukunft nach dem Abgas-
Skandal, Focus Magazine (April 2016), http://www.focus.de/finanzen/
news/wirtschaft-und-geld-die-zukunft-nach-dem-abgas-
skandal_id_5457885.html

   Ford CEO expects to have self-driving cars by 2020.\47\ 
        Similarly, Changan (Ford's partner in China) said a self-
        driving model should be on the market in 2-3 years, with the 
        automaker spending 5 billion yuan ($773 million USD) to further 
        the technology by 2020.\48\
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    \47\ Ford's self-driving cars likely around 2020, USA Today (Jan. 
2016), http://www.usatoday.com/story/tech/2016/01/05/ford-reaffirms-
multi-pronged-auto-tech-approach-ces/78301192/
    \48\ Inside China's Plan to Beat America to the Self-Driving Car, 
Wired (June 2016), https://www.wired.com/2016/06/chinas-plan-first-
country-self-driving-cars/

   Daimler, the maker of Mercedes Benz, plans to have its 
        driverless trucks ready by 2020.\49\ Uber placed an order for 
        100,000 Mercedes self-driving sedans for its ride-sharing 
        service by 2020.\50\
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    \49\ Daimler tests autonomous big-rig convoy on public roads, Road 
& Track (March 2016), http://www.roadandtrack.com/new-cars/car-
technology/news/a28548/daimler-tests-autonomous-big-rig-convoy-on/
    \50\ After considering Tesla, Uber reportedly placed an order with 
Mercedes for 100,000 self-driving cars, Electrek (March 2016), http://
electrek.co/2016/03/18/uber-order-mercedes-100000-autonomous-cars/.

   Nissan will make fully autonomous vehicles available to the 
        consumer by 2020.\51\
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    \51\ Nissan's autonomous drive car, Nissan USA (March 2014), http:/
/www.nissanusa.com/blog/autonomous-drive-car

   Toyota, the maker of Lexus, plans to bring its first models 
        capable of autonomous highway driving to the market by 
        2020.\52\
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    \52\ Toyota to launch first driverless car in 2020, Wired UK (Oct 
2015), http://www.wired.co.uk/article/toyota-highway-teammate-
driverless-car-tokyo

   GM predicts that most industry participants now think that 
        self-driving cars will be on the road by 2020 or sooner.\53\
---------------------------------------------------------------------------
    \53\ GM executive credits Silicon Valley for accelerating 
development of self-driving cars, WSJ (May 2016), http://www.wsj.com/
articles/gm-executive-credits-silicon-valley-for-accelerating-
development-of-self-driving-cars-1462910491

   BMW CEO Harald Krueger said that BMW will launch a self-
        driving electric vehicle, the BMW iNext, in 2021.\54\
---------------------------------------------------------------------------
    \54\ BMW will launch the electric and autonomous iNext in 2021, new 
i8 in 2018 and not much in-between, Elektrek (May 2016), http://
electrek.co/2016/05/12/bmw-electric-autonomous-inext-2021/
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IoT Automotive Technologies
    There also is good reason to review the fact that, within the 
transportation sector, there are two distinct yet often conflated 
technologies: the ``connected car'' and the ``autonomous vehicle'' 
(self-driving car). The first--with the rapid evolution to 5G cellular 
technology--may precede the second, but provides a great example of how 
technologies and capabilities rapidly advanced once the foundational 
capability for connecting cars was established. The same will likely 
hold true for autonomous vehicles once the foundational technologies 
are in place.
    Connected car. The connected car has existed for many years with 
increasingly sophisticated capabilities. From the initial built-in 
cellular connectivity, the capabilities today include real-time 
navigation and traffic updates as well as Internet web connectivity for 
on-board apps. In most countries, ``connected car'' is a broad term 
indicating that the vehicle is equipped with one or more technologies 
that enable Internet access--most often via a wireless network using 
advanced cellular (like 4G/LTE, 5G) and/or Wi-Fi technologies. A 
``connected car'' shares Internet access with other devices both inside 
as well as outside the vehicle, enabling passengers to access features 
including in-car entertainment, smartphone apps, navigation, roadside 
service and car diagnostics. (By contrast, USDOT tends to narrowly use 
the term ``connected vehicle'' to refer only to a vehicle with the 
agency's preferred V2V safety technology: Dedicated Short Range 
Communications or DSRC in the 5.9 GHz \55\ spectrum band.) These 
solutions will rapidly evolve to use two-way Internet connectivity to 
communicate with not only other vehicles V2V but also infrastructure 
(V2I) and other ``things'' (V2X).
---------------------------------------------------------------------------
    \55\ 5.9 GHz and 5G are entirely different things. 5.9 GHz is the 
embattled spectrum band in which DSRC technology would operate. Whereas 
5G is a cellular technology (that operates in non-5.9 GHz spectrum 
bands).
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    While this hearing is not intended to delve into spectrum policy, 
we would note that U.S. policymakers will ultimately need to address 
the path for various technologies. For example, nearly all studies 
projecting future marketplace penetration of connected vehicles are 
using the broader definition to reflect the projected pervasiveness of 
advanced cellular (5G), Wi-Fi, Bluetooth and satellite communications--
not DSRC.\56\ For example, Gartner predicts that by 2020, there will be 
a quarter billion connected vehicles on the road.\57\ This connected 
car market is projected to generate new services revenue from connected 
cars at approximately $40 billion annually by 2020.\58\
---------------------------------------------------------------------------
    \56\ See, e.g., Connected Car Report, Gartner (2015), http://
www.gartner.com/newsroom/id/2970017.
    \57\ Id.
    \58\ Id.
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    With 4G LTE now deployed in nearly every major market, the rapid 
evolution and market demand for cellular technologies like LTE-Advanced 
(LTE-A) and 5th generation cellular (5G), along with next generation 
Wi-Fi and Bluetooth, are driving this connected car innovation. These 
cellular technologies are the product of a competitive marketplace with 
significant and constantly evolving industry R&D, strong industry 
investment in wide-scale deployment, and very rapid and high 
marketplace adoption. If the U.S. seeks to capture a strong portion of 
this $40 billion per year connected car services market, it is 
imperative that the Nation's policies and resources support public and 
private investment in these advanced cellular technologies, including 
testbeds for cellular V2V safety critical communications and real-time 
safety messaging and collision avoidance.
    Autonomous vehicle (AV). As its name implies, the self-driving 
vehicle is capable of operating without a driver. It uses a complex 
array of tools to help it navigate real world conditions of day-to-day 
driving. For example, the Google self-driving car uses a mix of radar, 
LIDAR (measures distances by illuminating a target with laser light), 
HD cameras, advanced GPS and HD mapping to sense its environment and 
surroundings. There is no DSRC connectivity in the Google car; although 
it is widely expected that 5G connectivity will be added to many self-
driving cars.
    Autonomous cars also have the ability to make driving decisions 
based on complex analysis of data from these sensing elements. Self-
driving cars also may have (but need not) Internet connectivity; for 
example, they may use 4G or 5G cellular communications as secondary 
source of information for V2V real-time collision avoidance, in 
addition to the on-board sensor-based systems which provide their 
primary source of data. In short, the vehicle is increasingly becoming 
smarter, more complex, processing more data and effectively becoming a 
``data center on wheels.'' Intel has been leading the industry in data 
center technology for decades and appreciates the importance of secure, 
efficient and reliable computing.
    There are a number of technologies that are essential to the 
evolution of these solutions. Sensors have been and will continue to 
evolve rapidly. As noted, cameras and LIDAR as well as radar and 
ultrasound are used to help the car ``see'' what's around it. These 
sensors are being refined to be more purpose built for this specific 
application. Data from these sensors must then be integrated (sometimes 
called sensor fusion) at a first order to provide very fast initial 
indications of the environment. That data is then fed into very high 
performance computing platforms that can then process the data and make 
decisions about the control of the vehicle. The processing today is 
largely done according to algorithms that have been refined based on 
environmental understanding and knowledge of driving decisions. Going 
forward though, these decisions will be made using sophisticated 
``machine learning'' (ML) and ``deep learning'' (DL) technologies like 
vision-based object recognition which allows the vehicle to 'see' the 
objects in the environment around it--pedestrians, other cars, road 
signs, etc. These systems will gather data from vehicles on an on-going 
basis (called ``scoring), send that data to the datacenter or cloud, 
continuously ``learn'' from what is happening from the fleet of 
vehicles on the road (called ``training''), improve the driving model, 
and then send the improved model back down to the fleet. These systems 
must become well integrated end-to-end solutions that have persistent 
connectivity to the datacenter, and are able to evolve rapidly to meet 
the needs of more and more sophisticated transportation solutions.
    In the last few years, there has been a remarkable acceleration in 
autonomous vehicle investment, innovation and testing around the world. 
Discussions of IoT innovations and autonomous vehicles have quickly 
migrated from niche engineering and auto industry websites to 
mainstream publications. Seemingly from out of the blue, the term 
``self-driving car'' has entered into our everyday lexicon--with U.S. 
and global consumers of all ages demanding (and even expecting) sensor-
based collision avoidance technologies like predictive collision 
warning, automatic breaking, parking assist and active lane control 
when purchasing new cars. A recent study by The Harford and MIT AgeLab 
found that, like younger generations, 76 percent of drivers age 50-69 
purposefully seek out high-tech autonomous vehicle safety features.\59\
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    \59\ Looking Forward: Vehicle Technology Preferences Among Mature 
Drivers, The Hartford Center for Mature Market Excellence and MIT 
AgeLab (2016), http://extramile.thehartford.com/auto/vehicle-
technology-preferences-mature-drivers.
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    Moreover, the pace of autonomous vehicle investments and 
announcements around the globe have further accelerated in just the 
last 6 months. Over this time period, Intel has seen ship dates from 
our auto industry customers ``pull in'' (move up) by as much as 5 
years, as these companies have come to fully realize that they must 
accelerate their technology innovation time-to-market or be left 
behind. Indeed, these self-driving technologies--which seemed like a 
far off ``Jetsons'' fantasy just five years ago--seem just around the 
corner today.
    In order to turn this autonomous vision into a reality, the auto 
industry and transportation providers of the future must harness 
rapidly evolving technologies, collaborate with new partners like the 
high-tech industry, and embrace disruptive opportunities to innovate. 
This autonomous driving future will only continue to accelerate as 
technology advancements and the competitive marketplace further enable 
automakers to go to market with new autonomous vehicle innovations in 
an increasingly expedited manner to deliver on the vision of a zero 
accidents future.
Policy Recommendations for a National IoT Transportation Strategy
    Countries around the world are moving aggressively ahead on 
establishing national plans and blueprints with time-bound measurable 
goals, investing substantial funding in AV and 5G cellular V2V safety 
research and deployments, and launching PPPs to jumpstart these 
opportunities to quickly enable scale. As these other countries have 
recognized, a forward-looking IoT transportation strategy that will 
keep pace with global innovation is essential. It is critical for U.S. 
policymakers to enable a vibrant and state-of-the-art transportation 
system to ensure the Nation's global competitiveness and economic 
stability in the 21st century. By adopting and implementing a National 
IoT Transportation Strategy for autonomous vehicles and 5G-enabled 
connected cars, the U.S. will be poised to secure a worldwide 
leadership position in this next evolution of transportation.
    As a part of our larger U.S. National IoT Strategy (that would be 
developed pursuant to the new USDOC/NTIA IoT green paper process and 
the pending bipartisan DIGIT Act),\60\ Intel recommends that the 
following principles drive our National IoT Transportation Strategy:
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    \60\ Developing Innovation and Growing the Internet of Things Act 
(2016), https://www.fischer.senate.gov/public/_cache/files/03de7771-
088b-45ac-8552-f82ddc0aa480/digit-2016_final-bill-for-filing.pdf.
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    Prioritize Safety and Security. Enhanced safety is vital to the 
success of America's IoT transportation future. Safety means (i) 
reducing the number and severity of crashes and (ii) protecting 
consumers and businesses from security breaches of the vast amount of 
data generated by their vehicles. With respect to crashes, self-driving 
vehicles will remove the risk of human error, and thus are widely 
expected to reduce U.S. traffic deaths by tens of thousands per year, 
as discussed in detail above. With respect to security, future vehicles 
will generate a tremendous amount of ``data exhaust'' as they 
seamlessly connect to each other, infrastructure and consumer 
electronic devices and enable autonomous tasks.\61\ For example, a 
self-driving car could generate as much as two petabytes of data per 
year.\62\
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    \61\ The Future of Intelligent Transportation: http://
www.intel.com/content/www/us/en/automotive/experiencing-future-
intelligent-transportation-video.html
    \62\ A Self-Driving Car Will Create 1 GB of Data per Second, 
SmartData Collective (July 2013) (``Smart Data''), http://
www.smartdatacollective.com/bigdatastartups/135291/self-driving-cars-
will-create-2-petabytes-data-what-are-big-data-opportunitie.
---------------------------------------------------------------------------
    Security. Intel values security first and foremost. We believe that 
security is the foundation of IoT transportation and it is fundamental 
to Intel's roadmap planning. Our hardware and software are being 
designed from the beginning to be secure. This is important for trusted 
data exchange in the IoT, as data generated by devices (including 
vehicles) and infrastructure must be able to be shared among the cloud, 
the network, and intelligent devices for analysis. This enables users 
to aggregate, filter and share data from the edge of the network all 
the way to the cloud with robust protection. Data also must be accurate 
to be beneficial. Intel prioritizes the security, accuracy, privacy and 
integrity of data in all market sectors, and especially in the 
industrial (including transportation) domain where the safeguarding of 
critical infrastructure can be vital to economic and social stability.
    Intel appreciates that we must deliver and evoke consumer and 
industry trust through these hardened security solutions to motivate 
adoption and participation in the IoT marketplace. We believe it is 
critical to integrate security into the hardware and software, from the 
smallest microcontroller (MCU) at the edge of the network to the most 
advanced server central processing unit (CPU) in the cloud and all 
gateways \63\ and devices in between. These hardware-and software-level 
security capabilities create redundancies which prevent intrusions and 
enable a robust, secure, trusted IoT end-to-end solution.
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    \63\ A gateway is a node on a network that serves as an entrance to 
another network.
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    Hardware. Intel's hardware provides transistor-level security on 
the actual compute device itself. By integrating security into the 
device itself from the outset (rather than layering it on top at a 
latter point in the design cycle with other, less secure external 
features), Intel's IoT solutions enable our customers to know the exact 
unique identity of every device on their network. This technology also 
has the capability for encrypting that unique identity to provide 
anonymity properties in addition to hardware enforced integrity. 
Because each compute device can have an immutable identification to 
enable secure provisioning, a non-approved device will not be allowed 
to access the network. The MCU or CPU itself will provide the ``baked 
in'' (irremovable, non-changeable) identity of the device, making the 
level of security significantly more robust.
    On top of this immutable device identification, Intel's IoT 
solutions employ advanced hardware level security capabilities such as 
``whitelisting,'' which prevents harmful applications like viruses, 
control agents, and malware from ever being activated on the device. 
What this means is that, if the CPU ever ``sees'' an application that 
is not on its known good list (``whitelist'') try to run on the device, 
it will automatically lock out that device and not allow it turn on. At 
other layers in IoT solutions, Intel also uses another advanced 
hardware security capability called ``blacklisting,'' which blocks a 
defined list of known malware from entering the device and the network.
    Software. In addition to the advanced hardware security 
capabilities in Intel's IoT solutions, Intel Security (formerly McAfee) 
integrates advanced security capabilities that provide robust software-
level protection. This means that the software is continually 
monitoring the activity of its networked devices-and looking for any 
abnormalities or possible threats. If the monitoring software 
identifies a threat, it proactively notifies users and/or automatically 
quarantines any devices on the network that could be at risk. By 
employing this combination of transistor-level security, along with 
advanced hardware and software level security, from devices on the edge 
of the network all the way to the data centers in the cloud, Intel 
protects IoT assets and information in ways few others can. We know 
that security is critical to protect the integrity of IoT solutions, so 
we will design it in from the outset.
    We also must account for the distinct security challenges of 
autonomous and connected features, harnessing appropriate technical and 
policy strategies to mitigate risks and enable a safe, secure vehicle 
that evokes trust from drivers and passengers on U.S. highways. 
Autonomous vehicle solutions use local sensors and ``intelligence'' to 
provide a highly secure, self-contained, robust source of data. By 
contrast, a vehicle's ``connected'' features exchange data between two 
``things''--with the Internet, other cars, and infrastructure--
potentially making this threat landscape more vulnerable. This is one 
of many reasons why it is exceedingly important that we look to 
advanced cellular technologies like today's 4G and the soon-to-arrive 
5G for applications like V2V safety critical communications (vs. a 
system with multiple known vulnerabilities like USDOT's proposed DSRC 
Security Credential Management System).\64\
---------------------------------------------------------------------------
    \64\ SCMS relies on sporadic connection between the vehicle and 
infrastructure to validate and revoke certificates initiated by the 
Certifying Authority. This sporadic connection can cause large delays 
in revoking security certificates and can erroneously permit non-secure 
and unauthenticated messages to be transmitted to/among vehicles. By 
contrast, cellular networks use mechanisms to robustly protect vehicles 
from cybersecurity incidents; persistent cellular connections help 
accelerate certificate update, distribution, and revocation, making 
certificate management much more effective, secure and reliable.
---------------------------------------------------------------------------
    Encourage Innovation and Competition. Self-driving vehicle 
technology, connected cars, ``smart'' fleet management and intelligent 
transportation infrastructure have enormous potential to improve 
driving safety, mobility, energy use, and transportation efficiency--
paving the way for U.S. smart cities of tomorrow. Innovation and market 
competition--in tandem with light-touch, adaptive, technology neutral, 
performance-based regulation--must drive our Nation's policy framework 
and guidelines to enable the U.S. to lead the world in the automotive 
and transportation sector of the future.
    As we know, regulation of technology, however well intended, will 
always lag marketplace innovation and often thwart innovation. This can 
be true even in areas of extreme importance such as building secure 
networks and technologies. In order to position the U.S. to lead the 
rest of the world in the globally competitive IoT transportation 
future, USDOT R&D funding should help enable and accelerate industry-
driven investment. The agency should never seek to choose, mandate or 
direct the technologies which U.S. companies develop or in which they 
invest, nor should it put its thumb on the scale or try to drive a 
specific market outcome. Public policies that encourage innovation, 
competition, and market-driven investment are critical to enable U.S. 
leadership in IoT technologies like connected cars and self-driving 
vehicles to reach their full potential, realize maximum economic and 
safety benefits, and become widely available in a timely and globally 
competitive manner.
    Promote technology neutrality. Pursuant to the FAST Act \65\ Joint 
Explanatory Statement: \66\ ``The FAST Act ensures that [USDOT] 
programs are implemented and Intelligent Transportation Systems are 
deployed in a technology neutral manner. The Act promotes technology 
neutral policies that accelerate vehicle and transportation safety 
research, development and deployment by promoting innovation and 
competitive market-based outcomes, while using Federal funds 
efficiently and leveraging private sector investment across the 
automotive, transportation and technology sectors.'' As drafted by 
bicameral and bipartisan Members of Congress, this statement should 
serve as a constant guiding principle; it is critical that USDOT drive 
technology-neutral policies based on competitive market-based outcomes 
to ensure U.S. consumers benefit from the life-saving capabilities of 
the most advanced technologies, which stay apace with technology 
evolution for decades to come.
---------------------------------------------------------------------------
    \65\ H.R. 22, Fixing America's Surface Transportation Act (2015), 
https://www.congress.gov/114/bills/hr22/BILLS-114hr22enr.pdf.
    \66\ Joint Explanatory Statement of the Committee of the Conference 
at 10 (2015), http://transportation.house.gov/uploadedfiles/
joint_explanatory_statement.pdf.
---------------------------------------------------------------------------
    It is imperative that the U.S. align our future transportation 
strategy with the realities and direction of the worldwide open, 
competitive marketplace and the areas of largest global investment. We 
must architect and adopt a leading-edge, future-proof strategy that 
invests primarily in AVs (self-driving cars) and 5G cellular technology 
starting with V2V real-time collision avoidance applications. However, 
USDOT is not promoting--or even seriously researching--advanced 
cellular technologies like 5G for V2V safety critical applications, 
which many industry experts believe will be the leading global V2V 
safety technology.\67\ For the U.S. to stay apace our global 
competitors, Congress should direct USDOT to undertake a meaningful, 
technology-neutral cost-benefit analysis vs. DSRC \68\ to ensure that 
U.S. consumers are poised to reap the benefits of the best V2V safety 
technology(ies) that will evolve at the pace of marketplace 
innovation--and enable U.S. IoT transportation leadership now and in 
the future.
---------------------------------------------------------------------------
    \67\ See, e.g., DSRC Confronts a Battle for relevance at ITS World 
Congress (2014): https://www.strategyanalytics.com/access-services/
automotive/powertrain-body-chassis-and-safety/reports/report-detail/
dsrc-confronts-a-battle-for-relevance-at-its-world-
congress?Related#.Vwgur_krJD8
    \68\ It is critical that the Nation's limited funding be invested 
in 5G and AVs independent of DSRC, as AVs and 5G connectivity operate 
independently of (and without need for) DSRC. Yet, USDOT investment in 
AVs and cellular to date primarily have encouraged a DSRC aspect to the 
test bed or project. Despite many comments by high-tech industry 
advocating advanced cellular/5G for V2V safety and questioning a DSRC 
mandate in the agency's 2014 V2V ANPRM, USDOT still has not funded any 
advanced cellular testbeds for V2V safety communications that would 
enable a head-to-head comparison with DSRC.
---------------------------------------------------------------------------
    Most of the world is developing and testing AVs and 5G connectivity 
for real-time collision avoidance independent of DSRC (if they are 
testing DSRC at all). Let the technologies' capabilities determine 
marketplace winners and losers, rather than force industry investment 
in a technology (DSRC) chosen in 1999 before mobile broadband even 
existed--and that will put the U.S. behind other countries. Seventeen 
years later, we should be investing in the future (aligned with the 
greater global marketplace), rather than forcing U.S. investment in an 
old technology. If we invest the time now to do broader technology R&D 
and transition to a more future-proof strategy, policymakers will be 
ensuring that U.S. consumers have the benefit of the best collision 
avoidance technolology(ies) that will evolve at the pace of innovation. 
Without this, we risk thwarting U.S. global leadership and, more 
importantly, the potential to save more American lives.
    DSRC has been slow to develop (in testing phase for nearly two 
decades) and is not poised to evolve at the pace of innovation because 
the marketplace is unlikely to see the global industry support or 
voluntary widespread market demand that would enable economies of 
scale. Also, unlike 5G, which industry is evolving from existing 4G 
networks and infrastructure, DSRC will require entirely new 
infrastructure at massive taxpayer expense for years to come; the cost 
of building and deploying new infrastructure for DSRC and covering all 
necessary rural and urban areas is estimated to be approximately 
$3,000/mile.\69\ For these reasons, innovations like next generation 
cellular 5G are developed, tested, built out and commercialized at a 
far faster pace than DSRC--and will continue to evolve on pace with 
innovation. In the end, the losers will be U.S. consumers deprived of 
the best cellular V2V safety technologies that evolve on pace with a 
competitive marketplace.
---------------------------------------------------------------------------
    \69\ 5G-PPP Automotive White Paper (Oct. 2015).
---------------------------------------------------------------------------
    Encourage Open Platforms. Open IoT technology platforms are 
critical to the ability of U.S. companies to compete globally because 
they ensure cross-industry support and agreement. Open platforms allow 
multiple manufacturers to ``plug in'' their technologies, while 
proprietary platforms only allow use of a single manufacturer's 
proprietary technology. This encourages developers to create solutions 
that span from car to cloud in a simple way. Government should 
encourage industry to collaborate on open platforms for autonomous and 
connected vehicles.
    Open platforms are necessary to accelerate and maximize innovation 
across the increasingly broadening automotive and transportation 
industries and enable economies of scale. For example, Intel is widely 
deploying ''state of the art'' autonomous reference platforms that are 
open, standards-based and scalable to support safe and secure computing 
both in the vehicle and the connected data center. This enables other 
stakeholders and innovators to contribute core technology including 
platform software, machine learning algorithms and data collected from 
vehicle sensors to enable a safe and secure driving experience.
    Support Open Standards and Consortia Efforts. Global standards and 
consortia efforts are critical to maintain the long term viability of 
technology advancements. They enable a commercialization path that is 
scalable, interoperable and reusable across a variety of use case 
deployments, vendors and sectors. Accordingly, a certain level of 
standardization and interoperability is vital to the successful 
commercialization of self-driving vehicles, connected cars, ``smart'' 
fleet management and the intelligent transportation ecosystem. 
Industry-led voluntary global standards can accelerate adoption, drive 
competition, and enable cost-effective introduction of new 
technologies, while providing a clearer technology evolution path that 
stimulates investment.
    Industry is in the best position to lead development of 
technological standards and solutions to address global transportation 
ecosystem opportunities and challenges to enable self-driving vehicles, 
connected vehicles, ``smart'' fleet management and intelligent 
transportation systems. Policymakers should refrain from mandating 
specific technologies, standards, or protocols and, instead, let the 
marketplace determine technology winners and losers. Government should 
encourage industry to collaborate in global, open-participation 
standardization efforts to develop technological best practices and 
standards, and it should participate in the development of standards 
where there is a government interest and encourage the use of 
commercially available solutions to enable the benefits of these new 
technologies to become reality sooner.
    Invest in Public-Private Partnerships. The tech industry is 
critical to the future of U.S. transportation policy dialogue. A 
vehicle is an increasingly complex data center on wheels, requiring 
evermore high-powered processors and Internet connectivity--with self-
driving cars expected to process at 1 GB of data per second.\70\ As 
part of a National IoT Transportation Strategy, policymakers should 
encourage Public-Private Partnerships (PPPs) to launch and scale 
globally competitive transportation test beds. These testbeds are 
necessary to accelerate deployment of technologies such as 5G which is 
critical to U.S. leadership in V2V safety-critical and V2X 
communications and machine learning which is critical to autonomous 
driving.
---------------------------------------------------------------------------
    \70\ Smart Data.
---------------------------------------------------------------------------
    Government and industry collaboration can be one of our Nation's 
best assets to accelerate the adoption of world-class transportation 
systems. Viable PPPs between government and the auto and tech 
industries must entail logical investments for both government and 
industry, as well as ensure scalability of automotive innovations and 
sustainability of transportation infrastructure in the long term. Using 
public and private resources to facilitate U.S. research leadership, 
and governance for in 5G connectivity and autonomous driving, while 
leveraging existing industry standards and investments, will accelerate 
our future toward self-driving vehicles, connected cars, ``smart'' 
fleet management, and intelligent transportation infrastructure.
    Intel recommends that policymakers encourage PPPs in the following 
areas that are critical to the success of safe and secure autonomous 
and connected vehicles:

   Trusted Data and Secure Compute--Fully autonomous driving 
        will require the processing capabilities of a ``mini data 
        center on wheels.'' A self-driving car will require up to 40 
        Teraflops of computer graphics processing speed, which is the 
        equivalent to 20 HD TVs inside each vehicle. Compare: A Play 
        Station 4 uses only 1.84 Teraflops. Along with this enormous 
        computing power, every data exchange to and from the vehicle 
        must be trusted, safe and secure. As discussed above, powerful 
        computing with integrated security is Intel's core competency, 
        and what our data center customers have required for decades.

   5G Connectivity--As discussed at the outset, soon-to-be 
        launched 5G--boasts superior key performance indicators for 
        vehicle connectivity use cases, especially V2V safety-critical 
        applications. To align the Industry, Intel is driving standards 
        workgroups in 3GPP and the Wi-Fi Alliance to influence new 
        standards, converge protocols and demonstrate functionally safe 
        and secure safety-critical use cases. Intel and our partners 
        around the world in the academic, auto and technology 
        industries are working collaboratively to drive robust, open, 
        secure and scalable 5G standards for V2V safety-critical 
        communications.

   Security as a Foundation--Intel has long touted security as 
        a foundation for the IoT. Securing connected vehicles and the 
        supporting infrastructure is foundational to keeping passengers 
        safe and secure and requires an end-to-end system (vehicle to 
        cloud) approach. Not only must every vehicle be safeguarded 
        against cyber threats, but every device connected to the 
        vehicle and the personal information available via these 
        devices, must also be kept private as it moves between the 
        vehicle, connected devices, connected infrastructure, and the 
        cloud. Intel formed the Automotive Security Review Board \71\ 
        to help align the tech and automotive industries and 
        cybersecurity experts on guidelines and best practices to make 
        vehicles secure.
---------------------------------------------------------------------------
    \71\ Intel commits to mitigating automotive cyber security risks, 
Intel Corp. (Sept. 2015), https://newsroom.intel.com/news-releases/
intel-commits-to-mitigating-automotive-cybersecurity-risks/.

   Machine Learning--The fully autonomous vehicle must become 
        the ultimate learning machine. It will be relied upon to make 
        smarter and safer decisions than even the most skilled human 
        driver. Intel has been investing in companies with expertise in 
        functional safety \72\ and doing foundational research in Deep 
        Learning for many years and is working to ensure that our 
        products both in the vehicle and in the data center are capable 
        of bringing the intelligence needed for the vehicle to sense 
        and adapt.
---------------------------------------------------------------------------
    \72\ Intel Acquires Yogitech to Strengthen its Internet of Things 
Group, Venture Capital Post (April 2016), http://www.vcpost.com/
articles/119131/20160407/intel-yogitech-altera-corp-autonomous-
vehicles.htm

   Open, Standards-Based Platforms--Intel is working with 
        fellow tech and auto industry leaders to define industry 
        standards to accelerate autonomous driving deployments and 
        create economies of scale that enable rapid marketplace 
        adoption. This will enable industry leaders to contribute core 
        technology including platform software, machine learning 
        algorithms and data collected from vehicle sensors to enable a 
        safe and secure driving experience.
Conclusion
    Intel appreciates the opportunity to share our perspective on the 
enormous opportunity of the IoT in the transportation sector. We look 
forward to working with this Committee and other policymakers to 
develop a strategy for U.S. leadership in the next evolution of 
transportation--one that is poised to evolve at the pace of innovation.

    Senator Fischer. Thank you very much.
    Next, we have Dr. Robert Edelstein, Senior Vice President 
of AECOM. Welcome.

 STATEMENT OF DR. ROBERT EDELSTEIN, SENIOR VICE PRESIDENT, ITS 
                      PRACTICE LEAD, AECOM

    Dr. Edelstein. Chairman Fischer, Ranking Member Booker, 
members of the Subcommittee, on behalf of AECOM, I would like 
to thank you for the opportunity to testify on the advancement 
of new technologies to enhance our transportation and 
infrastructure across the country.
    AECOM is a Fortune 500 firm where we integrate design, 
build, operations, maintenance, as well as finance of 
infrastructure programs. According to Engineering News-Record, 
we ranked number one in transportation as well as other market 
sectors.
    Over the years, we have seen transportation management 
centers, or TMCs, evolve from becoming single-dimensional to 
multidimensional, multimodal, and multijurisdictional. We look 
at the next wave as incorporating predictive algorithms and 
automated decision support systems so we can stay ahead of 
congestion rather than reacting to it.
    AECOM is a global leader in TMCs. Our forte is really in 
the area of operations where we operate at over 40 facilities 
throughout the United States. In Florida and California, we 
developed dynamic pricing software to support the managed lane 
systems. In Virginia, we've operated the reversible roadway 
systems. In New Jersey, we've worked with IBM in developing the 
next generation of advanced traffic management systems 
software, positioning themselves to incorporate the predictive 
algorithms and decision support systems in the future. In 
Michigan, we operate four TMCs, and that is really the hotbed 
of all connected vehicle testbeds as well as research. As well 
as Missouri, where we are operating the gateway TMC, which will 
be accommodating the new innovations of the Road to Tomorrow 
program in the near future.
    The pace of change in this area really creates a critical 
need for extensive technology partnerships. Strong and adaptive 
technology partnerships allow communities to build upon the 
lessons learned from previous efforts across the country.
    AECOM has collaborated with firms like Xerox, where we 
developed the dynamic pricing software, with IBM working on 
smart city projects over in India, as well as work that we have 
done in New Jersey. Next month, we were selected and will be 
starting work with the Colorado Department of Transportation on 
the RoadX program. We've also been supporting the Missouri DOT 
on their Road to Tomorrow program and coming up with new 
technology partnerships and new innovations.
    The Internet of Things provides endless opportunities for 
TMCs to grow. As no one owns the Internet, nor the controls or 
the information that is transmitted across it, the same can be 
said about the Internet of Things. There are about 75 million 
servers that operate the global Internet. There are 1.2 billion 
cars on roadway systems throughout the world, more than 20 
percent here in the United States. But cars are inefficient. 
They are parked 95 percent of the time. Our transportation 
systems outside the peak hours and the middays are 
significantly underutilized.
    So there is a reason why leading global Internet companies 
are looking at connected and autonomous vehicles as they 
understand the issues are similar to the decentralization that 
created the Internet many decades ago.
    IoT approaches will allow people and cargo to be 
transported more efficiently across multimodal transportation 
networks at designated pickup and drop-off times. This will 
enable the balancing of transportation supply and demand in 
real-time and allow the user, the end-user, to optimize their 
trips based on what's right for them in terms of the modes that 
they use, the schedules, and the routes.
    In recent years, there have been several innovations that 
have been incorporated into our transportation systems--smart 
roadways, data management systems, integrated corridor 
management, and now most of the attention is being focused in 
on the connected and autonomous vehicles.
    I would like to leave you with my vision of the future for 
the TMC of the future, at least in my perspective. The TMC of 
the present continues to focus in on traffic operations and 
safety, and rightfully so, while the TMC of the future will 
start accommodating these next-generation ITS strategies--
managed lanes, active traffic management, et cetera.
    The Internet of Things will start to include both 
transportation and nontransportation functions together. While 
this integration may be virtual or it may be a collocation of 
operations staff, and there are some advantages and 
disadvantages to both approaches, the integration has the 
potential to open up new areas to apply the IoT and big data to 
operate our systems more efficiently, so I would ask that you 
consider the TMC of the future when we start building our Smart 
Cities.
    And my testimony that I'm submitting for the record has 
included a number of policy recommendations that I would like 
you to consider as you deal with these issues in the future. So 
on behalf of AECOM, I would like to thank you for receiving my 
testimony. I look forward to your questions.
    [The prepared statement of Dr. Edelstein follows:]

  Prepared Statement of Dr. Robert Edelstein, Senior Vice President, 
                        ITS Practice Lead, AECOM
    Chairman Fischer, Ranking Member Booker, and members of the 
Subcommittee, on behalf of AECOM, I thank you for this opportunity to 
testify on the advancement of new technologies to enhance 
infrastructure and transportation across the country. Whether we are 
discussing the so-called ``Internet of Things'' (IoT) in transportation 
and infrastructure, or more broadly, the application of technology, and 
the utilization and analysis of data to evaluate, manage and improve 
system performance, there is much being accomplished in this area.
    My name is Robert Edelstein, and I am a Senior Vice President and 
Intelligent Transportation Systems (ITS) Practice Leader for AECOM.
    When I joined AECOM in 1978, my focus was largely on the planning, 
design and construction of transportation facilities including 
roadways, transit systems, airports, seaports, and multimodal 
transportation centers. This focus has transitioned to making these 
infrastructure projects more efficient in terms of operational 
integration. This is now facilitated through the advent IoT and big 
data applications.
About AECOM
    AECOM is a premier, fully integrated professional and technical 
services firm positioned to design, build, finance, operate and 
maintain infrastructure assets around the world for public and private 
sector clients. We have nearly 92,000 employees--including architects, 
engineers, designers, planners, scientists and management and 
construction services professionals--serving clients in over 150 
countries around the world. AECOM is ranked--for the seventh 
consecutive year--as the #1 engineering design firm by revenue in 
Engineering News-Record magazine's annual industry rankings, and has 
been recognized by Fortune magazine as a World's Most Admired Company. 
The firm is a leader in all of the key markets that it serves, 
including transportation, facilities, environmental, energy, oil and 
gas, water, high-rise buildings and government. AECOM provides a blend 
of global reach, local knowledge, innovation and technical excellence 
in delivering customized and creative solutions that meet the needs of 
clients' projects. A Fortune 500 firm, AECOM companies, including URS 
Corporation, Tishman Construction and Hunt Construction Group, have 
annual revenue of approximately $18 billion.
Evolution of Transportation Management Centers (TMCs)
    Over the years, transportation management centers (TMCs) have 
transformed from being single-dimensional (e.g., focusing on signals, 
freeways, transit systems) to becoming more multi-jurisdictional and 
multi-modal. The ``TMC of the Future'' is anticipated to evolve in 
applying predictive models and automated decision support systems to 
stay ahead of congestion rather than reacting to it.
    AECOM is a global leader in TMCs in all aspects of master planning, 
design, software development, systems integration, construction, and 
operations. Our forte is in the area of operations where we have worked 
in over 40 TMCs, thereby giving us an end-user's perspective of ITS and 
how to take it to the next level.
    In Florida and California, we developed dynamic pricing software to 
operate their managed lanes networks. In Virginia, we designed, 
operated and maintained their reversible roadways systems. In New 
Jersey, we developed the next generation of Advanced Traffic Management 
System software to support predictive analytics and decision support 
systems. In Michigan, we are operating four TMCs where Connected 
Vehicle test beds are operating. In Missouri, we are operating the 
Gateway TMC in St. Louis which we anticipate will accommodate ``Road to 
Tomorrow'' innovations in the future.
    Performance measures are reported on a monthly and annual basis for 
many of these TMCs. For example, the most recent annual report for the 
Florida DOT TMC in Miami shows a benefit-cost ratio of 53, meaning that 
for every dollar invested in the program, $53 is being returned in 
terms of travel time savings and safety benefits. This considers the 
fact that for every minute that a lane is blocked it translates to 4 
minutes of delay and the probability of a secondary accident occurring 
increasing by 2.8 percent. Therefore, if you can clear the blocked lane 
15 minutes faster, then you can avoid a one-hour delay and reduce the 
probability of a secondary accident occurring by over 40 percent.
Technology Partnerships and Smart Cities
    The pace of change in this area creates a critical need for 
extensive technology partnerships. Innovation is occurring through 
these numerous and varied partnerships, and Federal, state, and local 
policy should do everything possible to encourage and facilitate 
continuation of dynamic partnering opportunities. Project sponsors need 
to pursue platforms that are flexible and will allow them to grow and 
develop over time as the community sets its priorities and develops its 
blueprint to guide future decision-making.
    Strong and adaptive technology partnerships allow communities to 
build upon lessons-learned from previous efforts across the country. We 
recommend integrating the transportation technology strategy with the 
long-range regional transportation plan to connect the dots between 
existing conditions, forecast future conditions, and transformative 
technologies. Further, being creative and catalyzing new partnerships 
with the private sector is what enables adaptive solutions to be 
developed to new and changing challenges.
    AECOM collaborates with many of the technology giants including 
Xerox with whom we developed the Los Angeles dynamic pricing system, 
and with IBM where we are developing software systems for the New 
Jersey Turnpike and collaborating on developing smart cities in India.
    We were recently selected for the RoadX program in Colorado, and we 
are assisting the Missouri DOT on the ``Road to Tomorrow'' program in 
developing technology partnerships and innovations. In response to 
these emerging trends, the Colorado DOT is forming a technology-driven 
innovation venture called ``RoadX''. This initiative is aiming to make 
traveling in Colorado crash-free and delay-free, and will improve the 
efficiency of the state's transportation system within the next 10 
years. The collaborative project focuses on building partnerships and 
entrepreneurial relationships that will deliver innovative solutions to 
reduce the cost of transporting goods, turn a rural state highway into 
a zero-death road, and improve congestion on Colorado's critical 
corridors. The program will employ a multi-pronged deployment, 
operations, innovation and technology approach with several efforts to 
be completed in the next five years. The Missouri DOT ``Road to 
Tomorrow'' program is looking at a broad suite of innovations including 
solar roadways, ``Internet of Things'' applications for smart traffic 
control, safety and road assistance, as well as smart pavement 
applications and truck platooning. Aggressive approaches to innovation 
such as these efforts require strong technology partnerships.
Internet of Things (IoT)
    As no one owns the Internet, nor the controls and routes used to 
transmit data, the same could be said about the IoT. While there are 75 
million servers running the global Internet, there are 1.2 billion cars 
driving global transportation (of which 20 percent are in the U.S.). 
Personal vehicle ownership is grossly inefficient: cars are estimated 
to be parked 95 percent of the time and our transportation systems are 
under-utilized during non-peak periods.
    There is a reason the leading global Internet companies are looking 
at connected and automated vehicles as they understand the issues are 
similar to the decentralization of car ownership that created the 
Internet decades ago.
    IoT approaches will allow people and cargo to be transported more 
efficiently across multimodal transportation networks at designated 
pickup and drop off times. This will enable the balancing of 
transportation supply and demand in real time by optimizing routes, 
modes, and schedules while eliminating human errors, thereby reducing 
accidents.
    Working IoT strategies into our short and long-range transportation 
plans is a challenge. AECOM is currently supporting the New Zealand 
Transportation Authority in preparing them for connected and automated 
vehicles by assessing various scenarios of technology adoption rates 
and identifying the appropriate technology infrastructure improvements 
that will support it.
Innovations
    In recent years, several innovations have surfaced to embed 
technology into our transportation systems to enable them to operate 
safer and more efficiently. Many DOTs have embraced a Transportation 
Systems Management & Operations approach which focuses on developing a 
higher level of operational integration across transportation modes 
while being aligned with performance measures used to improve 
operations. Other strategies include smart motorways, smart parking, 
data management, dynamic pricing, integrated corridor management, and 
electric vehicle charging systems. In addition to ITS, our ``New 
Ventures'' Practice seeks innovations in all aspects of our business 
such as the Hyperloop program which will eventually transport pods of 
people and cargo at speeds in excess of 700 mph. Meanwhile, smart 
cities, connected and automated vehicles have been receiving the most 
attention.
    Examples of innovative projects where a great deal of the 
excitement is focused include:

   Lake Tahoe Smart Parking: This is a demonstration of how 
        this technology improves the user's experience in mobility. 
        Estimates indicate that 30 percent of urban congestion is 
        created by people circling city streets looking for parking.

   LA Metro Mobility Hubs: The mobility hub model brings 
        multiple technology-enabled transportation choices together in 
        a single place to create a more streamlined experience for 
        commuters, visitors or residents going about their daily 
        business in the Los Angeles region. This project, funded by the 
        Jobs Access Reverse Commute program, is also a way to make the 
        benefits of a smarter transportation system accessible to those 
        without access to the Internet at home.

   Connected Vehicle Data Applications for TMCs: Transportation 
        agencies understand the importance of connected and automated 
        vehicles and the impending emergence of this technology on the 
        roads. AECOM is helping agencies figure out how to integrate 
        this more holistically into the transportation ecosystem.

    Each new innovation brings with it unique benefits, such as better 
management of infrastructure, and more responsive government services. 
Innovations can stretch limited resources to address greatest demand, 
bringing operational efficiencies that save taxpayers money, including:

   On-demand services: Improve garbage collection efficiency 
        sending garbage trucks to collect trash based on sensors that 
        indicate the need for service.

   Waste reduction: An estimated 2.1 trillion gallons of clean, 
        treated water is lost every year to leaks in water 
        infrastructure. For example, during 2013, Houston lost 15 
        percent of its water--15 billion gallons--to leaking pipes. 
        Even aggressive efforts to fix leaks will not keep up with the 
        rate of new leak formation. We need to better manage the flow 
        of water by embedding sensors in water pipes throughout the 
        distribution network which will save energy and water.

   Optimized systems: We can better manage storm water to 
        minimize runoff and maximize capacity. Kansas City, Missouri is 
        using sensors at critical points across the city for advance 
        notification of potential flooding issues. Jacksonville, 
        Florida is using a combination of cameras, sensors and 
        analytics tools to quantify the passage of cars, pedestrians 
        and bikes to measure the high rate of fatalities and injuries, 
        inform planning staff of the need for new bike/pedestrian 
        infrastructure as well as tracking and evaluating resulting 
        behavior change, thereby increasing safety for pedestrians, 
        cyclists and drivers.

   Use of data to preempt and predict problems before they 
        occur: Infrastructure sensors can provide an ongoing assessment 
        of the lifespan of major bridges, and even detect structural 
        problems. For example, on the Brooklyn Bridge, sensors monitor 
        cracks and temperature fluctuation.

   Expanding the capacity of government to reach more people: 
        Digital kiosks in Kansas City and New York City, for example, 
        are making it possible for citizens to access city services 
        without needing to have access to smartphones or the Internet 
        at home. This is essential in helping local government bridge 
        the digital divide.

   Better communication to stakeholders: This includes real-
        time tracking of transportation (where is my bus) and other 
        services such as snow plows (when will my street be plowed). 
        When Pennsylvania was hit with a major snow storm last year 
        that crippled traffic on the interstates, the DOT used its 
        partnership with Google Waze to provide information to drivers 
        stuck in traffic/snow when the highways were shut down
TMC of the Future
    I would like to leave you with my vision for the ``TMC of the 
Future''. While the ``TMC of the Present'' continues to focus on our 
core functions related to traffic operations and safety (i.e., 
incident, traffic, special event, and work zone management); and the 
``TMC of the Future'' will accommodate next generation ITS strategies 
(e.g., active traffic management, managed lanes, integrated corridor 
management, connected vehicles, predictive modelling, decision support 
systems); the Internet of Things has the potential for integrating 
transportation operations with other city services (e.g., smart 
parking, public safety, smart buildings, security, air quality, 
emergency management, water & waste water management, and smart energy 
grid systems).
    While this integration may be virtual or a physical collocation of 
operations staff, and there are pros and cons to each approach, the 
integration has the potential to open new ways to apply the IoT and big 
data to utilize our transportation resources to its highest and best 
use while enabling the user to customize their trips based on their 
specific needs and desires. I suggest that consideration be made to 
incorporating the ``TMC of the Future'' concept into Smart Cities.
Enabling Policies
    Innovation is occurring at an incredibly rapid pace across this 
country. To address these changes, and continue to foster innovation, 
Congress may wish to consider the following:

    Revisiting policies at the Federal and state levels to attract 
technology partnerships. For example, public-private partnerships may 
be considered where the auto manufacturers/original equipment 
manufacturers (OEMs) build new capacity (e.g., an additional traffic 
lane) to accommodate autonomous vehicles. As the penetration of 
autonomous vehicles grows over time, more vehicles would likely use 
this dedicated lane. Funding for all infrastructure remains a 
challenge. Through the current available and developing technologies, 
it would be possible to enable the assessment of user fees which would 
generate revenue to offset the costs of construction, operations and 
maintenance. This also opens the possibility for revenue sharing 
arrangements that could expedite the phase in of autonomous vehicles 
while generating revenue for both parties.
    Relieving regulatory constraints that may hinder implementation of 
new technologies. Much of our public policy is built around the 
technologies of the past and can make it difficult to introduce new 
alternatives. This is particularly relevant when you think about how 
cities function--if an inspector has access to real-time data in the 
field, he or she may be empowered to make different decisions than if 
he were to simply respond to the issue at hand.
    Providing expanded funding for ``Smart City'' grants to allow more 
cities to participate across the Nation. As 78 cities applied for the 
USDOT Smart City Challenge grant, and only one (Columbus) was selected, 
the interest in these technology developments is significant, and 
demand for resources is high. Dedicated resources for Smart Cities 
would provide an expanded national showcase of how IoT and big data can 
be applied in a diverse range of applications. Federal funding for the 
implementation of new technology applications can remove the risk for 
project sponsors and provides technology partners (large and small) the 
opportunity for a return on investment to cover their R&D costs.
    Provide Federal funding for programs similar to RoadX (Colorado) 
and Road to Tomorrow (Missouri). These programs are seeking technology 
partnerships to innovate new technologies and apply them to our 
transportation systems. While RoadX is funded by the Colorado DOT, the 
Road to Tomorrow is primarily reliant on revenue generated from new 
sources and innovative partnering strategies. New grant programs (such 
as the nationally significant freight and highway (FASTLANE) grant 
program included in the FAST Act can be helpful, as can funding 
provided through the TIGER Grant Program. At the end of the day, 
sustainable revenue streams are critical for major innovations to be 
implemented in meaningful ways.
Areas for Future Focus/Opportunities
    Standardization is critical: This will further help the scalability 
of these solutions: data management (ownership, sharing, privacy, 
security and future monetization strategies).
    Open architecture and interoperability of systems: It is important 
to maintain flexibility to adapt systems over time as technology 
evolves so quickly. Communities need to be sure that they are building 
a platform that can adapt as the technology changes.
    Workforce Development: Managing digital infrastructure requires new 
skill sets and there is a foundational need to focus on digital 
literacy at all levels within government (from the field technician to 
supervisors and management). We need to build local capacity for data 
analysis which requires the ability to contract with and hire talent 
equipped for the new world of big data.
Closing
    On behalf of AECOM, I would like to thank you for receiving my 
testimony and look forward to addressing your questions.
                               Attachment
                               
                               
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    Senator Fischer. Thank you very much.
    Next, Mr. Jordan Kass, the President of Managed Services at 
C.H. Robinson. Welcome.

 STATEMENT OF JORDAN KASS, PRESIDENT OF MANAGED SERVICES, C.H. 
                            ROBINSON

    Mr. Kass. Chairman Fischer, Ranking Member Booker, and 
members of the Commerce, Science, and Transportation Committee, 
thank you for the opportunity to testify at today's hearing.
    As one of the Nation's largest third-party logistics 
providers, C.H. Robinson has a unique view of how goods and 
commerce flow from manufacturer to consumer. My name is Jordan 
Kass, and I am President of Managed Services for C.H. Robinson. 
I joined Robinson in 1999 by way of an acquisition.
    At that time, I created a startup within Robinson trying to 
figure out how to leverage Internet technology within the 
supply chain. Today, that startup business manages over $3 
billion of logistics spend in 170 different countries on behalf 
of our customers. Our mission is to develop innovative 
technology platforms paired with managed services that help our 
customers connect, automate, and optimize their supply chains.
    C.H. Robinson has over 150 offices around the world 
networked through our common proprietary platform called 
Navisphere, which provides our employees, our customers, and 
our carriers visibility to freight shipments around the country 
and globe.
    Today, we are also speaking on behalf of the Transportation 
Intermediaries Association, which represents 1,500 3PLs of all 
sizes.
    We do not own any commercial trucks ourselves, but build 
technology platforms and logistics services that streamline 
complex transportation management on behalf of our customers. 
Our diverse carrier base includes motor carriers, railroads, 
airfreight, and ocean carriers.
    The division of Robinson that I lead works with some of the 
largest companies in the world, and this platform that we have 
developed serves as the platform these companies use to gain 
visibility and control over our supply chain. Our customers 
include companies like Microsoft, Delphi Automotive, and Ocean 
Spray.
    A major component of our value proposition is routing 
massive amounts of information and money quickly and accurately 
around the world. This is enabled by technology and automation. 
From the truck driver using our cell phone app to find 
available loads to the customer who needs to find desired 
landed costs tracked to the item level, data and the Internet 
of Things is driving change in our business. We are rapidly 
expanding these tools and information available to all trading 
partners across the supply chain.
    For example, a single truck owner-operator uses our app to 
check in like a GPS-equipped truck, and similarly a global 
shipper can view tracking updates anywhere in the world via a 
PC, smart phone, or tablet.
    Businesses today are part of global cross-functional teams 
of coordinating production, customer service, sales, finance, 
and transportation. They work together toward an end goal of 
customer experience and agile market response.
    As Congress considers the implications an increasingly 
connected world has on policy, we see things differently, from 
a supply chain and flow of goods viewpoint.
    Today, others have discussed privacy and IT infrastructure. 
However, we think that Congress also needs to look at practical 
issues regarding freight movement brought about by the Internet 
of Things. We fully understand that the Subcommittee does not 
have jurisdiction over all the issues I will mention. However, 
the Internet of Things forces us to look holistically with our 
customers at end-to-end supply chain practices. We want to 
reiterate that the greatest challenge Congress and 
subcommittees may have with the Internet of Things is that it 
will force the government to work across silos or be left 
behind by more agile governments. The following are our 
recommendations.
    First, tax rates. Many of the companies leading the 
revolution around the Internet of Things are operating with a 
tax code designed for the 1980s. For example, C.H. Robinson is 
a service company with no assets and we pay full U.S. corporate 
tax of 35 percent. Even though we are 208 on the Fortune 500, 
we are a Fortune 100 corporate taxpayer. If Congress wishes to 
incubate globally leading countries, a corporate tax reform is 
a prerequisite.
    World-class customer customs agency. We see the U.S. 
customs clearance process as a significant risk to supply 
chains. When the ACE system goes down for 2 hours during 
produce season in San Diego, it impacts supply chains across 
the Nation. Congress needs to make sure our U.S. customs agency 
provides world-class service and works well with agencies to 
ensure safe and efficient movement of goods.
    Increasing resources for cargo theft deterrence. Cargo 
thieves are using the Internet to target specific freight. Law 
enforcement is challenged to investigate cargo thefts and 
victims in many locations. A stolen load of almonds may 
originate in California, be stolen in Nevada on a truck based 
out of Missouri. We recommend increasing penalties for cargo 
theft and providing law enforcement resources to fund cargo-
theft specific units.
    Land use and planning around the rise of megacities. 
Increasingly, freight moves between a handful of global cities 
seeing huge population and density growth, including Chicago, 
Houston, New York, and LA. Issues of land use, truck parking, 
congestion, vehicle size, and operating hours all interact with 
the growth of things and the speed of change of delivery direct 
to the consumer.
    Thank you for the opportunity to provide insight into how 
the Internet of Things is impacting supply chains. We look 
forward to working with the Committee on policy that allows 
U.S. logistics companies to continue leading the world.
    [The prepared statement of Mr. Kass follows:]

   Prepared Statement of Jordan Kass, President of Managed Services, 
 C. H. Robinson on behalf of Transportation Intermediaries Association
    Chairwoman Fischer, Ranking Member Booker, and members of the 
Commerce, Science and Transportation Committee, thank you for the 
invitation and the opportunity to testify at today's hearing. As one of 
the Nation's largest third party logistics providers, C. H. Robinson 
has a unique view of how goods and commerce flow from manufacturer to 
consumer. The transportation brokerage and third party logistics 
industries have grown substantially the last 10 years and I will 
provide you an overview of our role in the marketplace and policy 
recommendations to consider around the Internet of Things as it relates 
specifically to supply chains.
Introduction of Jordan Kass
    My name is Jordan Kass and I am the President of Managed Services 
for C. H. Robinson. I joined C.H. Robinson in 1999 via the way of an 
acquisition. At that time I created a startup within the framework of 
CH Robinson. You may recall that was the peak of the dot.com boom and 
everyone was trying to figure out how to leverage Internet technology. 
The business I began for CH Robinson was focused on bringing the 
Internet into the world of logistics and supply chain. Today, that 
business has grown tremendously and we manage over $3Billion dollars of 
logistics spend in 170 different countries on behalf of our customers. 
Our mission is to develop innovative technology platforms paired with 
managed services that help our customers connect, automate, and 
optimize their supply chains.
Introduction of C.H. Robinson
    C. H. Robinson was founded in 1905 and facilitates the movement of 
over 17 million shipments per year. We have been named the #1 3PL for 
five years in a row by Inbound Logistics magazine and have pioneered 
many industry innovations. We are also speaking today on behalf of the 
Transportation Intermediaries Association, which represents 1500 3PL's 
of all sizes. C.H. Robinson is a leading member of TIA and serve on 
their board of directors. C.H. Robinson is the 10th largest publicly 
held company headquartered in Minnesota, and we have over 150 offices 
across the United States. All of our offices are networked through a 
common proprietary platform, called Navisphere, which provides our 
employees, our customers and our contracted carriers' visibility to 
freight shipments across the country and across the globe regardless of 
mode.
    We are a Fortune 250 company with annual revenues of more than 
$13.5 billion serving manufacturing, retail and wholesale customers of 
all types across the economic spectrum. We do not own any commercial 
trucks ourselves, but rather build technology platforms and logistics 
services that allow us to streamline complex transportation management 
on behalf of our customers. We have developed the largest and most 
diverse carrier base in the U.S. in order to transport our customer's 
freight. Our carrier base includes motor carriers, railroads, air 
freight, and ocean carriers. Leveraging our technology platform, our 
expert talent worked with approximately 68,000 transportation providers 
in 2015.
    As I mentioned, the division of C.H. Robinson that I lead is 
focused on delivering technology and services that connect, automate, 
and optimize global supply chains. We work with some of the largest 
companies in the world and our platform serves as the technology these 
companies use to gain visibility and control over their supply chain. 
Our customers include companies like Microsoft, Delphi, John Deere, and 
Ocean Spray.
    A major component of our value proposition is to route massive 
amounts of information and money quickly and accurately around the 
world. Our platform vis-a-vis the Internet formulates the information 
and visibility pipes our customers require. Again, I want to emphasize 
that we do this on a massive scale.
    This is enabled by increasingly sophisticated technology and 
automation across the supply chain. From the truck driver using a cell 
phone to search for available loads on our Navisphere Carrier app to 
railroads sending massive tracking data in electronic formats to 
customers desiring to know landed costs tracked to the item level, data 
and the Internet of Things is driving incremental change in our 
business. One example of the massive role data plays can be seen in our 
every increasing machine to machine communication. Every day, C.H. 
Robinson transmits and receives over 20 million electronic 
communications.
    We are rapidly expanding the tools and information available to all 
trading partners across the supply chain. For example, single truck 
owner operators can use our app to perform a tracking check call just 
like a GPS equipped truck without ever picking up the phone and 
similarly a global shipper can view that tracking update anywhere in 
the world via a phone, PC, or tablet.
    Businesses and transportation departments are part of global cross 
functional teams coordinating sophisticated supply chains across many 
silos. Production, customer service, sales, finance and transportation 
all work together towards an end goal of customer experience and agile 
market response. As Congress rightly considers the implications of how 
an increasingly connected world impacts policy and society, we would 
like to provide insights we see from a supply chain and flow of goods 
viewpoint. While other witnesses will discuss issues of privacy, 
security, and IT infrastructure, there are many practical issues 
Congress should also consider regarding supply chain changes coming 
from the Internet of Things and how U.S. companies can lead in this 
industry.
    We fully understand that this subcommittee does not have 
jurisdiction over all the issues we will mention. However, the Internet 
of Things crosses many of our company's silos and has forced us to look 
holistically with our customers at end-to-end supply chain practices. 
We want to reiterate that the greatest challenge Congress and this 
subcommittee may have with the development of the Internet of Things is 
that it will force the U.S. Government to break down silos and work in 
cross-functional teams or be left behind for smaller countries and more 
agile governments to lead the way. Following are recommendations the 
Internet of Things working should consider:
Tax Rates
    Many of the company's leading the revolution around the Internet of 
Things are operating with a tax code designed for manufacturing in the 
1980s. For example, C.H. Robinson is primarily a service company with 
no assets and we pay the full U.S. corporate tax rate of 35 percent 
annually in addition to state taxes. Even though we are #208 on the 
Fortune 500, we are a Fortune 100 corporate taxpayer when the Fortune 
500 is ranked in terms of raw corporate tax paid. Over the last 11 
years, our company alone has paid more than $2 billion in Federal 
corporate tax.

   If Congress wishes to promote and incubate globally leading 
        companies in the Internet of things based in the US, corporate 
        tax reform is a pre-requisite.
World Class U.S Customs Agency
    The Internet of Things provides companies the ability to source 
parts and inputs and sell globally. Consumers can now buy directly from 
overseas retailers and manufacturers and with the increase in the de 
minimis value by Congress from $200 to $800, we increasingly see the 
U.S. Customs clearance process as a significant risk to supply chains. 
When the ACE system goes down for 2 hours during produce season in San 
Diego, or U.S. EPA holds up a shipment at the port of Baltimore because 
they are understaffed, it impacts supply chains across the Nation. Just 
as successful companies are now forced to work across silos, one of the 
biggest challenges that the Internet of Things will place on the U.S. 
Government is on the customs service and their coordination with other 
government agencies of all types.

   Congress needs to make sure our U.S. Customs agency provides 
        world class services and that they are able to work well across 
        agencies to ensure a safe and efficient movement of goods or 
        the U.S. will not hold a leadership position regarding the 
        Internet of Things.
Increasing Resources for Cargo Theft Deterrence
    While many will be focused on personal privacy and the data 
collected on individuals through the Internet of Things, please also 
remember to strengthen cargo theft penalties. One of the unintended 
consequences of increased technology in the supply chain is the 
increased ability of cargo thieves to target specific freight across 
the country. Law enforcement is challenged to prioritize and 
investigate cargo thefts with victims and stakeholders in many diverse 
locations. For example, a stolen load of almonds may originate in 
California, be stolen in Nevada, on a truck based out of Missouri and 
brokered by a company in Chicago.

   We recommend that Congress increase penalties for cargo 
        theft and provide law enforcement resources to fund local and 
        regional cargo theft specific law enforcement units.
Land Use and Planning around the rise of Mega Cities
    A trend that we are monitoring closely is the trend of megacities. 
Increasingly, freight movement is concentrated in and between a handful 
of global cities that are seeing huge population and density growth, 
including cities in the U.S. like Chicago, Houston, New York, and Los 
Angeles. Providing goods to these urban populations is a growing 
logistics challenge Congress should monitor and prioritize. Issues of 
land use, truck parking, congestion, vehicle size, and operating hours 
all interact with the growth of the Internet of Things and the speed of 
change of delivery directly to the consumer.
    Thank you for the opportunity to provide insight into how big data 
and the Internet of Things is impacting supply chains. We commend the 
Committee on their focus on this important topic, but emphasize that 
the rate of change in the market continues to accelerate. We look 
forward to working with the Committee and the working groups 
established by this legislation to quickly and specifically identify 
policy areas that will allow U.S. companies to continue to lead the 
world.

    Senator Fischer. Thank you very much to the entire panel. 
We will begin our first round of questions, 5 minutes for each 
member.
    I would like to start with one issue that I've been 
concerned about, and that is the creation of these regulatory 
silos. I'm worried about the lack of coordination between 
government agencies where we may see duplication take place, 
and cross purposes happen on this with regulations.
    When my Ranking Member and I and two other Senators 
introduced the DIGIT Act, one thing we wanted to be sure to do 
was have a working group created, and we did that. That is a 
working group with government and also private stakeholders. 
And we want to make sure that we can look at streamlining and 
having complementary regulations between agencies when we 
address the Internet of Things.
    So I would like to ask all the members of the panel, what 
do you believe is causing these regulatory silos? And what do 
you think is the best way that we can encourage cooperation 
among agencies in order to look at how best to allow that 
innovation and creativity to continue to take place with the 
Internet of Things?
    Who would like to start? Yes, Doctor?
    Dr. Edelstein. I think the departments of transportation, 
including the U.S. Department of Transportation, have already 
taken that first step. That first step is really transportation 
systems management and operations, or TSM&O. The way I look at 
it, with TSM&O and IoT, when those two worlds collide, it is 
going to unleash really unlimited potential.
    Transportation systems management and operations is 
creating operational integration between the various modal 
partners, whether it be buses, trains, toll roads, freeways, or 
arterial operations. It is also aligned with performance 
metrics so everybody has some skin in the game with regard to 
defining those performance metrics, tracking those performance 
metrics, and making sure we are making certain improvements 
that are noticeable by the end-user, which is that the 
traveler.
    So, again, it's not a regulatory issue, but it is more of 
an operational issue, and I think that it is starting to come 
together rather quickly in many States throughout the country.
    Senator Fischer. Mr. Davis?
    Mr. Davis. Chairwoman Fischer, I think you are asking a 
great question. Let me touch on a couple things.
    First, I want to applaud the work that has been done on the 
DIGIT Act and the goals that that is trying to achieve. I think 
that is a very important direction for us to be taking with 
regard to the Internet of Things.
    You asked an interesting question about the history in 
terms of why we have these silos, and I think it's really been 
because of the optimization that has been needed in those 
various different industries. We want to optimize what is 
happening in shipping, optimize what is happening in retail, in 
the network infrastructure, so I think that's been a very 
natural kind of evolution.
    But as we think forward around the Internet of Things, that 
will be one of our challenges to scale, to have these local 
optimizations, because we are seeing that these technologies 
needed to create the connectivity between things and the data 
center or cloud will need to become more and more common.
    That is why we are advocating the implementation of open 
platforms to allow for much greater flexibility to break down 
some of those silos. That will be essential for the Internet of 
Things to be able to scale.
    We look at 5G technologies. We look at what we are trying 
to accomplish across the industries with regard to security. 
These things are going to have to become much more open. 
They're going to have to be driven by public-private 
partnerships to define the right capabilities. That is what is 
going to enable scalability as we go forward in the Internet of 
Things.
    Senator Fischer. Do you think we are going to have to see a 
collision take place before we will have that openness? Or will 
we be proactive in trying to head it off before we get there?
    Mr. Davis. Well, obviously, I am hoping that we can be 
proactive and avoid a collision, but I think that is really why 
it is important to think about this globally and think about 
what is happening in other parts of the world and have that 
national IoT strategy for the U.S. to really be in a leadership 
position to help shape how that evolves.
    I think as far as we can think ahead and be proactive, that 
will avoid that ultimate collision.
    Senator Fischer. Thank you. I'm running out of time, but if 
the other three witnesses can give me a short answer?
    Yes?
    Mr. Monje. Senator, your question is exactly right. It's 
something that we've been driven to do by the White House 
directives.
    We are working very closely with the Federal Trade 
Commission when it comes to privacy. They are in charge, but we 
have a huge stake in it, and we're working very closely with 
them, the national NTIA on issues of cybersecurity broadband 
access, and the FCC when it comes to spectrum.
    We are not only reaching across the Federal Government but 
also down into the States as well. NHTSA is establishing their 
regulatory framework working very closely with the States, 
because what you don't want to have is patchwork.
    Senator Fischer. OK.
    Ms. Reynolds, did you have a comment?
    Ms. Reynolds. I appreciate the question. Obviously, 
government silos are nothing new. They are something that we 
have struggled with for quite a long time. I think that what it 
really comes down to is the way that we measure success is 
often at odds.
    To Dr. Edelstein's point about having a shared performance 
metric and hearing a clear signal, which we've heard from U.S. 
DOT and the Federal Government, that the road to funding is 
paved with partnerships and that if you want to be at the 
table, you need to bring private partners along with you, you 
need to bring the State, you need to bring your region, are 
really bringing up some very uncomfortable sacred cows that we 
have to wrestle with.
    So I think that is one of the major ways that there has 
been kind of a happily forced arranged marriage among different 
sectors of the public and private side.
    Senator Fischer. And, Mr. Kass, shortly, if you could 
condense?
    Mr. Kass. My expertise is supply chain and technology. It's 
not government. So having said that----
    Senator Fischer. You're the best one to answer the 
question.
    [Laughter.]
    Mr. Kass. Having said that, as I said in my testimony, 
these walls need to be broken down. If we don't do this, what's 
going to happen--there are two supply chains at work. There is 
a physical one and a virtual one. The virtual supply chain is 
about moving information and money. In the Internet of Things, 
that's going to be visible. If we don't fix this problem, all 
of the problems that exist today, the nodes, the failure nodes, 
those are going to be exposed on a massive scale. So we have to 
get out in front of this and get out in front of it quickly.
    Senator Fischer. Thank you very much.
    Senator Booker?
    Senator Booker. Thank you very much.
    When I was Mayor of my city, I discovered, in just getting 
accountability for my team members, that if I started 
encouraging constituents to tweet at me problems, that I would 
begin to find out about things. And it worked better than I 
knew. I could find out about potholes before my road engineers. 
I could find out about traffic lights out. I started 
crowdsourcing what was going wrong in the city. Obviously, 
that's a very rudimentary, inefficient way, when you can set up 
cities like Los Angeles where you could have sensors detecting 
problems and funneling information at the speed of light. So 
the Smart Cities Initiative to me, as a former Mayor, is really 
exciting.
    Would you please give Mayor Garcetti my best when you get 
back to Los Angeles? I studied with him at Oxford. He still 
owes me 10 pounds. At this point, it's worth only like $.50, 
the way the pound is going.
    [Laughter.]
    Senator Booker. But tell him I want my money.
    Would you tell me what kind of challenges you guys are 
facing in implementing what is a cutting-edge vision to try to 
make Los Angeles--what are the biggest obstacles to being a 
smart city that you are finding?
    Ms. Reynolds. So thank you for the question. I will say it 
is two things.
    One, fundamentally, public and private sides are going to 
have to get way outside our comfort zones in order to achieve 
the kind of partnership that we need. Our procurement 
practices, for example, I would say, are probably the single 
biggest hurdle to really getting public partners to the table. 
As soon as it takes us 18 or 24 months to write a request for 
proposals and bring a vendor on board, the technology has 
passed us by. The Federal Transit Administration and others 
have done a really good job signaling that they are willing to 
waive some of the Federal procurement requirements to allow 
cities to have access to these funds. I would identify that.
    Second, I would say that the role of government--our most 
rudimentary tool is that we can say no. I think that oftentimes 
we find ourselves in that position when we are encountering the 
sort of disruption or introduction of new technologies in 
transportation in our cities. We need to pivot to using one of 
the other sort of lesser used powers of government, which is to 
bring people together, to convene, possibly to regulate, and to 
make sure that the price of entry into our cities is that you 
have to serve them equitably.
    I will just give one example. Mayor Garcetti executed a 
data-sharing agreement with Waze. One in four drivers in the 
City of Los Angeles is using Waze to get around our city with 
positive and potentially negative impacts.
    The way we have been using it is bringing Waze data into 
our ATSAC system, fusing the data streams that we have to make 
our system even smarter. We save Los Angeles drivers over 40 
hours every year because we have a smart transportation signal 
system.
    That is just the tip of the iceberg, and it points to the 
other big challenge, which is that we don't have the skillsets 
inside government. I don't have a civil service classification 
for data scientists in the City of Los Angeles, and we 
desperately need those kinds of skillsets and capacity-building 
inside government so that we can really come to the table as an 
equal partner.
    Senator Booker. I appreciate that. That is what the White 
House is finding out with their innovation team. Procurement is 
one of the biggest problems we have. The procurement process is 
set up for dealing with big, massive companies, not the small 
innovators who are at the cutting edge. I appreciate that.
    In the 1 minute and 30 seconds I have left, Mr. Kass, Mr. 
Davis, I get very annoyed when I watch other countries who are 
beginning to out-innovate us. We should be the innovation 
capital of the globe. I'm a competitive guy. I want us to be 
number one.
    But when I see government regulations choking things like 
the drone industry, for example, in watching innovation in that 
sector go over to Europe as opposed to here because we haven't 
created an environment that is best for that. So to the two men 
who are in the private sector, could you guys just tell me what 
are other countries doing better than us that we should be 
doing better than them?
    Mr. Davis. I think it's a great point. That is one of the 
reasons we have been advocating for public-private 
partnerships, to be able to bring private industry alongside 
what is happening from a regulatory standpoint as well as what 
is happening in areas like academia, to be able to provide 
those kinds of partnerships to go off and define what needs to 
happen. Again, the emphasis is on what as opposed to the very 
specific how of the implementation.
    That is what we often find ends up happening when we try to 
put regulation in place too early as the technology is still 
rapidly evolving. We should agree on what we are trying to 
accomplish as opposed to the very specific implementation.
    That is one of the things that we find as we look at what 
is happening globally, the opportunity to innovate much more 
openly.
    Senator Booker. Jordan, why don't you hold on, because I 
want to be respectful to Senator Cantwell. She is a dear 
friend, and I don't want to make her angry, and I'll let her 
go. We will come around to another round.
    Mr. Kass. Yes. No problem.
    Senator Fischer. Senator Cantwell?

               STATEMENT OF HON. MARIA CANTWELL, 
                  U.S. SENATOR FROM WASHINGTON

    Senator Cantwell. Thank you, Madam Chair. And thank you to 
the panelists.
    Is it Monje?
    Mr. Monje. Monje.
    Senator Cantwell. Monje. Thank you so much for your work.
    I wanted to talk to you and Mr. Davis about freight because 
this is something we want to be strategic about in the United 
States. The opportunity to ship more goods to markets overseas 
from the U.S. is a very important economic strategy for us, but 
it has to move in a timely fashion. And obviously, there are 
lots of challenges.
    So how is the Department of Transportation--we have had 
this strategic freight plan--working with the Internet of 
Things? We had I think it was one of the California ports here 
last year, and they talked about the efficiencies that you can 
roll out at our ports by having this kind of data and 
information on cargo movements and on trucks.
    Mr. Monje. Yes, ma'am. Thank you for the question.
    Freight is the lifeblood of our economy, and this Congress 
has been on the record in really pushing us as a department to 
come up with a strategic plan to work with States.
    In terms of the Internet of Things, it has tremendous 
potential. We know we are going to see 45 percent more freight 
over the next 30 years on our roads, on our ports, across our 
seaways. Some of the things we are doing include testing and 
improving the quality of the technology called FRATIS, which we 
are implementing at the Ports of Long Beach and Los Angeles, 
and it is helping operators get cargo off ships and to where 
they need to go a lot quicker.
    We have a connected vehicle pilot in Wyoming that is really 
focused on speeding truck traffic along Interstate 80, which 
has major weather events. So how are we using technology to 
move that forward?
    As part of our Smart City Challenge, we actually got a lot 
of really neat examples of communities that are trying to 
figure this out for themselves. Columbus is proposing, and they 
won, so they are going to be able to implement, the ability to 
practice truck platooning along smart corridors, better ways to 
do urban parking.
    One of the neater ideas that came is from Austin, which is 
actually looking at shared urban delivery lockers, so people as 
they get off the bus will be able to pick up their groceries or 
a package, and they don't have to make an extra trip to get 
there.
    So we are doing a lot of foundational research in the 
maritime area. We know that this is a tremendous area of 
opportunity, and that we need to be partners in that process.
    Senator Cantwell. Mr. Davis, I think the average tractor-
trailer gets something like 6 miles per gallon, so anything we 
can do to increase the fuel efficiency there is going to be a 
huge savings.
    I know that, again, DOT has SuperTruck. Is that what you 
were referring to? The SuperTruck program? I didn't get the 
acronym you used.
    Mr. Davis. FRATIS is what I referred to.
    Senator Cantwell. How do you spell that?
    Mr. Davis. F-R-A-T-I-S.
    Senator Cantwell. OK. Well, I also know that you have a 
SuperTruck program, and it is focused on getting more like 
nine, almost 10 miles per gallon. So how do you think that some 
of these tools could be used to help the transportation sector 
on timing on deliveries?
    Mr. Davis. I think we've seen some really exciting 
technologies in the early stages. I think that Mr. Monje talked 
about a couple. Mr. Kass even described a few, which is to be 
able to put technologies in trucks that enable us to understand 
how they are being driven and to be able to provide feedback to 
the driver about he or she can drive more efficiently.
    We have seen this implemented in a couple of large trucking 
firms already, and they see some of those pretty impressive 
improvements in fuel efficiency. I think that is one.
    We are seeing technologies evolve that allow us to be very 
cost-effectively identify the location and the conditions of 
high-value freight so that we know where it is, we know what 
kind of conditions it is being subjected to.
    And then to be able to use autonomous technologies, to be 
able to identify maybe containers that are coming in on a ship 
with where trucks are located to be able to synchronize the way 
they are offloaded to take advantage of the trucks or the 
traffic conditions to move that material effectively.
    So we are seeing some very interesting early stage 
technologies. The challenge is how we make that more and more 
common across all of those applications to enable it to scale.
    Senator Cantwell. I think we learned in air transportation 
now that there is a cell lot and everybody hangs out in the 
cell lot.
    I think that statistic is quite impressive, a 45 percent 
increase in freight traffic. I mean, we want the United States 
to make things. We want to sell things. We want to move them. 
But the congestion level at the ports is so great, so a 
strategy that could ease that traffic in there and move it in a 
more systematic way would mean huge savings and would help us 
with our competitiveness in manufacturing, so I hope that we 
will stick with it.
    Thank you, Madam Chair.
    Senator Fischer. Thank you.
    Senator Markey?

               STATEMENT OF HON. EDWARD MARKEY, 
                U.S. SENATOR FROM MASSACHUSETTS

    Senator Markey. Thank you, Madam Chair.
    The Internet of Things leads also to the Internet of 
threats, because, obviously, every device that has the Internet 
built into it then becomes subject to hacking. That's just the 
bottom line. So you have to basically deal with the digital 
tale of two technologies. It is the best of technologies, it is 
the worst of technologies simultaneously.
    So if you don't deal with threats, then all you are doing 
is ignoring the inevitable problems that are going to be 
created.
    So really, today's new cars are just computers on wheels. 
That's all they really have become. That is why in 2013, and 
again last year, Senator Blumenthal and I asked 20 automakers 
what they are doing to protect our computers on wheels, and 
here is what we learned.
    Thieves no longer need a crowbar to break into your car. 
They just need an iPhone.
    Last year, we witnessed firsthand how easily cars could be 
hacked. We watched as hackers remotely took control of the 
brakes, the steering, and the acceleration of a Jeep Cherokee. 
Chrysler had to recall 1.4 million vehicles to fix this 
cybersecurity problem.
    But in this new Internet of Things era, cybersecurity just 
cannot be an afterthought. Rather than addressing cybersecurity 
problems after a hack has occurred, we have to ensure robust 
cybersecurity protections are built into these technologies 
right from the beginning.
    That means that we need enforceable rules of the road to 
protect driver privacy and security. That is why I introduced 
legislation with Senator Blumenthal, the Security and Privacy 
in Your Car act, or SPY Car Act, that directs the National 
Highway Traffic Safety Administration and the Federal Trade 
Commission to establish Federal standards to secure our cars 
and protect our drivers.
    So for all the panelists, please, answer yes or no. Do you 
believe that cars should have mandatory cybersecurity 
standards, including hacking protections to protect all access 
points in a car; data security measures that prevent unwanted 
access to all collected information; and hacking mitigation 
technologies that can detect, report, and stop hacking attempts 
in real-time?
    Dr. Edelstein?
    Dr. Edelstein. Definitely, yes.
    Senator Markey. Yes. OK.
    Mr. Davis?
    Mr. Davis. Definitely yes. The one thing I would add is 
that I think it is important to define what we need to 
accomplish to address the things that you described, but also 
to allow technology to evolve quickly.
    Senator Markey. But if it evolves and it is still not 
installed, we should mandate that is installed?
    Mr. Davis. Yes, we should define requirements to ensure 
these things are secure.
    Senator Markey. Mr. Kass?
    Mr. Kass. Yes, we need the appropriate controls, but I 
agree we need to do it in a very balanced way that doesn't kill 
innovation.
    Innovation is like a whack-a-mole, right? You try to beat 
it down, it is just going to pop up someplace else. So we 
really need a way, a mechanism, of ensuring that if we are 
going to put controls in place, that it is not offsetting the 
innovation that is about to take place, but rather helping it 
and making sure it thrives.
    Senator Markey. But haven't you found over the years, Mr. 
Kass, that if people can get away without building in the 
protections against hacking or privacy, that they just do it to 
save money?
    Mr. Kass. People never cease to amaze me.
    Senator Markey. Thank you so much. So it's not just whack-
a-mole. It's just whack-a-bad-person.
    Mr. Kass. Well, no, I was speaking of innovation. We can't 
policy our way out of it. Someone is going to innovate, and it 
needs to be us. We need to lead.
    Senator Markey. Right. We have to do it, but at the same 
time, we then have to tell people who don't want to install the 
safety protections that they have to do it.
    Mr. Kass. Fair enough.
    Senator Markey. OK, thank you. That's all I'm really 
saying.
    And, Ms. Reynolds?
    Ms. Reynolds. I think the answer is certainly yes, and I 
will add that there is a role for smart infrastructure as well. 
One of the few benefits to having started our connected signal 
system in the 1980s is that it is all hard fiber and it is 
virtually unhackable. There will be a role for infrastructure 
to manage not just the hacking but the 12 or 20 different 
vehicle software technologies that are out there.
    Senator Markey. But again, I didn't get the correct answer 
from the auto manufacturers.
    Ms. Reynolds. Yes.
    Senator Markey. Thank you so much. I mean, seatbelts are 
good but not just yet. Airbag is good, but not just yet. We 
just want the technology to evolve a little bit more. So when, 
Lord, will you put those seatbelts, those airbags, those 
hacking protections in?
    Mr. Monje?
    Mr. Monje. Thank you, Senator. And thank you for your 
leadership on this issue.
    You know, cybersecurity is going to be a continuous 
challenge for the rest of this century. There is substantial 
motivation on our part to get it right on behalf of safety, 
certainly from the manufacturers.
    NHTSA is doing everything we can. We have established 
standards, a security credential management system for V2V 
technology to ensure that those packets of information can be 
shared safely. We are going to continue to work with industry, 
continue to work with experts to make sure we continue to fight 
this threat.
    Senator Markey. Dr. Edelstein--if I can just have one more 
minute, please? Thank you.
    Do you believe also that we should make owners explicitly 
aware of collection, transmission, retention, and use of 
driving data and provide owners the right to say no to data 
collection and retention without losing access to key 
navigation or other features?
    Dr. Edelstein. Yes.
    Senator Markey. Yes.
    Mr. Davis?
    Mr. Davis. Yes.
    Senator Markey. Yes.
    Mr. Kass?
    Mr. Kass. Yes. And just generally speaking, with all the 
information that is going to be available, this concept of 
opting out I think is important.
    Senator Markey. Excellent, thank you.
    Ms. Reynolds?
    Ms. Reynolds. Yes.
    Senator Markey. Excellent.
    Mr. Monje. Yes, sir. It's very important to only collect 
the information you need and make sure consumers know what they 
are sharing.
    Senator Markey. Thank you.
    So I think that is a great balance here. It's not all good. 
Like any other technology, there is the bad as well. And we 
just have to make sure that we build in the protections at the 
same time that we build in the opportunities. And if we do 
that, then I think we discharge our responsibility as 
policymakers.
    I thank you, Madam Chair, Mr. Ranking Member, for this 
hearing.
    Senator Fischer. Thank you, Senator Markey.
    Dr. Edelstein, in your written testimony, you discuss 
several innovative transportation projects that you are 
currently working on.
    For example, you mentioned that AECOM employs sensors to 
monitor the Brooklyn Bridge for cracks and also for temperature 
fluctuation. What is the impact of real-time data monitoring on 
our Nation's critical transportation infrastructure assets, 
especially as it relates to public spending on maintenance?
    Dr. Edelstein. We're not monitoring the Brooklyn Bridge. 
That was a case example that other people are doing, but it has 
nothing to do with AECOM. I just wanted to get that out.
    Again, my vision for the control centers of the future, I 
really see it getting into not only moving people and cargo 
more efficiently, but also asset management in real-time. This 
way we can put sensors out on our bridges. We can monitor smart 
buildings with regard to energy systems. We can put sensors out 
on water systems to see if there are any potential leaks in the 
pipes that will cause inefficiency.
    So what I am looking at is a control center--again, it can 
be a virtual control center; it doesn't have to be one massive 
building--a control center that would monitor all of the assets 
that the agencies own, operate, and maintain.
    I think by doing that, you will get more efficiencies, and 
I think it will dovetail very nicely with the smart city 
concept. With the smart city concept, I think the platforms 
that they will be using allows everything to be interconnected, 
but there needs to be something there, a control center, that 
monitors all of these assets in real-time to gain more 
efficiencies with the systems.
    Senator Fischer. As you have this control center that is 
monitoring in I would assume a more timely and also more 
accurate manner, how do you see that affecting safety in the 
future? And also looking at the reliability of our 
infrastructure, using the example of the Brooklyn Bridge?
    Dr. Edelstein. OK. Well, with regard to safety, if it was 
the Brooklyn Bridge and you had another incident with regard to 
I-35, the bridge up in Minnesota, hopefully by having the 
sensors out on the bridge, we could be more proactive in 
detecting if there is something wrong with the bridge ahead of 
time so we could make some corrections to it before you have a 
catastrophe, something like that.
    In terms of reliability and other forms of safety, the 
traffic management centers are already doing that. They are 
able to detect an incident or a lane closure or an accident a 
lot faster than the way that we used to do it without the 
technologies embedded into the systems.
    For example, we've been working on a project down in Miami 
for about the last 10 years operating their control center. 
When we first started, it took about 15 minutes or so to clear 
a lane blockage incident. Now it is about half the time. That 
half the time translates to safety benefits as well as travel 
time reliability.
    In terms of safety benefits, for every minute that we save 
in a lane-blocking event and clearing that lane that much 
faster, it translates to nearly 3 percent of probability of a 
secondary accident happening. So if you take a 15-minute lane-
blocking event, take a lane-blocking event and you can clear it 
15 minutes faster, you are talking about improving the 
probability that you won't have a secondary accident by about 
40 percent.
    In terms of travel time reliability, the formula is, I 
think for every minute that you save, it translates to 4 
minutes of saving. So, again, a 15-minute clearance improvement 
would translate to about an hour backup delay that you are 
saving.
    So I think it all ties together, whether you are managing 
assets, or you are managing traffic as well as safety.
    Senator Fischer. Do you see cities and States and also 
private businesses stepping forward and willing to embrace 
these new technologies? Is there enthusiasm on their part? Or 
is it balanced with I guess reality in looking at the cost?
    Dr. Edelstein. It is more so the latter. There is 
definitely enthusiasm. No doubt about it. But many cities are 
struggling, just paying the day-to-day bills. They have to deal 
with potholes. They have to deal with physical safety 
improvements as well as infrastructure improvements that may 
increase capacity in some of their roadway systems.
    Technology is nice. They are looking at that as a long-term 
solution. But balancing the firefighting issues that they deal 
with on a day-to-day basis and the budget and the evolution of 
technology as it comes online, it's pretty tricky.
    But I would have to say that most cities and States, they 
are very enthusiastic about technology innovations. But again, 
there is just so much money to go around.
    Senator Fischer. Thank you very much.
    Senator Booker?
    Senator Booker. Chair Fischer, Senator Klobuchar has asked 
if she could go next. She has a committee to return to.
    Senator Fischer. Senator Klobuchar?

               STATEMENT OF HON. AMY KLOBUCHAR, 
                  U.S. SENATOR FROM MINNESOTA

    Senator Klobuchar. Thank you very much. I am the ranking 
member on this hearing we are having on a bill that we passed 
last year on sex trafficking, but I want to thank you all for 
coming. I especially want to thank Mr. Kass who represents here 
C.H. Robinson, which is headquartered in Eden Prairie, 
Minnesota, with his 22 years of experience in freight 
logistics.
    As you may know, C.H. Robinson has evolved from a wholesale 
produce brokerage house to a major third-party logistics 
provider, is the largest network of motor carrier capacity in 
North America, had gross revenues of $13.5 billion in 2015, and 
is one of 17 Fortune 500 companies based in my State. So we are 
proud of the work that they do and what they can bring to this 
discussion.
    Mr. Kass, could you talk about how you have leveraged the 
Internet of Things at your company to increase the efficiency 
of multimodal shipments?
    Mr. Kass. Sure. When you think about our company, its focus 
is on developing technology platforms and services to connect, 
automate, and optimize supply chains. What the Internet of 
Things has done is allowed us to create algorithms that quickly 
and easily select the most optimal mode of transportation.
    Many shippers today can't respond in the time, they don't 
have the resources, they may not even have the expertise, to 
take a look at what their freight network looks like in real-
time and, frankly, shift from a truckload shipment to an 
intermodal shipment, which poses significant advantages.
    The intermodal obviously is going to reduce the carbon 
footprint. It is going to lower the overall cost. And it is 
going to take capacity off the road, and I think put it in a 
safer environment.
    Senator Klobuchar. Very good. Thank you very much.
    One of the things that we've learned in our state, which I 
guess we share with all three members who are here today, New 
Jersey, Nebraska, and Wisconsin, is that you can have all the 
networks you want for transportation, but if you have snow and 
the trucks can't move, then we have a problem, or the trains 
can't go.
    I know the Minnesota Department of Transportation has 
applied for a grant through the U.S. Department of 
Transportation's Advanced Transportation and Congestion 
Management Technologies Deployment Program--that is quite a 
mouthful--that is used to improve the effectiveness of 
snowplows.
    It is no small thing in our State. We are pretty proud of 
how quickly we clear out our roads, but technology can always 
make us better. Let's just say it works a lot better in 
Minnesota than Washington, D.C.
    Dr. Edelstein, how will the new communications 
opportunities from the Internet of Things improve public safety 
and the delivery of government services with things like 
snowplowing?
    Dr. Edelstein. Well, if you look at it, let's start with 
the end-user. The end-user wants their street snowplowed within 
a certain time-frame or they want to know at least when their 
street is going to be plowed. By having the Internet of Things, 
this could provide the communication between the individual and 
the agency responsible for the plowing, so you open up the 
communications.
    Also, you are opening up the potential to optimize where 
you have the snowplows, which roads deserve the highest 
priority. And you can monitor that in real-time, so if you have 
to do multiple runs of a street because the snow is still 
coming down, again, you have the potential of using the IoT and 
big data to optimize the routing of snowplows, assuming that 
they have automated vehicle location devices on them, or some 
type of sensors.
    Senator Klobuchar. I think that is just a great example 
because I really am stunned by how long it takes.
    My daughter went from the public schools of Minnesota, 
where she had no snow days for 7 years, and then when she got 
to the Arlington Public Schools, which are very good, she had 2 
weeks off in her first year.
    So I do think that there has to be a better way to do that. 
I understand areas that have more snow are more affected by it.
    I guess my last question is just along those same lines, 
the need to have broadband installation and fast speed 
broadband to make this work. One of the bills that we have in 
the MOBILE NOW Act would actually require focus more on dig-one 
switches to try. When you have highway projects, you try to put 
the Internet in at the same time to make it more efficient. And 
obviously many of us on this committee are working on expanding 
access for broadband in rural areas as well.
    Any comments you have about the need to have Wi-Fi to make 
all of this work?
    Dr. Edelstein. That's really outside my expertise, so I'll 
take a pass on that.
    Senator Klobuchar. OK. Can you assume you need Wi-Fi if we 
are going to have these things on snowplows?
    Dr. Edelstein. Yes.
    Senator Klobuchar. All right. OK, thank you.
    Senator Fischer. Thank you, Senator Klobuchar.
    Senator Booker?
    Senator Booker. I just want to finish up on the question I 
was in before about what other countries are doing that is 
better than the United States, what we can be learning so we 
can, again, continue to be the global exporter of innovation on 
the planet Earth.
    So, Mr. Davis, you were sort of finishing your answer. I 
didn't know if you wanted to add any more before I go to Mr. 
Kass or Dr. Edelstein.
    Mr. Davis. I'll just add one example. A great technology 
enabler for the Internet of Things is going to be 5G wireless 
infrastructure. We see a number of countries moving very 
quickly there, creating testbeds, creating opportunities to do 
trials. We'll see it not only in fixed infrastructure that 
needs to be able to communicate back to a data center or cloud, 
but even mobile infrastructure.
    We see in Germany they are running trials now on the 
autobahn to learn how to maintain high data rate connectivity 
when a car is moving very fast down the freeway. We see around 
the Winter Olympics, Summer Olympics coming up in the future in 
South Korea and Japan, doing, again, early pilots, early 
testbeds. I think the more that we can do things to foster----
    Senator Booker. Why aren't we doing those here?
    By the way, with the 5G, some of the innovation is because 
you have a more predictable, understandable marketplace for 
innovation and patents and the like over in Europe now than you 
necessarily do here. Is that some of the reason why?
    Mr. Davis. I think it is much more about just creating the 
opportunity. We see these big events like the Winter Olympics 
or the Summer Olympics. That becomes kind of a focal point for 
that country to say let's go put a lot of resources in.
    Senator Booker. So we're not, maybe government is not 
creating sandboxes where people can----
    Mr. Davis. I think we want to look for more testbeds. We 
want to look for opportunities where we can say, hey, let's go 
all in, let's create a solution to really kind of force the 
technology to get deployed, for us to understand where we need 
to do more optimization. I think it is looking for those kinds 
of opportunities.
    Senator Booker. OK, thank you.
    Jordan, I mean, Mr. Kass, first of all, I want to just 
echo, because you put in your comments, and it is something 
that I feel very strongly about, that we have a ridiculously 
bad tax environment to incentivize companies here. And I see it 
in biotech with a lot of New Jersey firms inverting now because 
of the bad environment.
    So please don't think that I haven't gotten that point and 
don't say, basically, hallelujah, amen, and join your chorus of 
conviction to change that.
    But what else are other countries doing besides creating a 
better tax environment?
    Mr. Kass. Firstly, thank you for reading my mind. I 
appreciate that. That was going to be the way I answered the 
question.
    But secondarily, when I look at our global base of talent 
and the diversity of it, there is something that is happened 
here where we are just not developing math students the way 
that other countries are. And I think that is core to 
engineering, and it is core to where the Internet of Things is 
going.
    Don't get me wrong, we have talent. But if we are not 
developing it at the speed and pace that some of these other--
--
    Senator Booker. No, we've fallen from number one for 
graduating engineers, math majors. Now we are out of the top 
10. Other countries are realizing that this new economy is 
going to necessitate having STEM folks, and America is falling 
behind.
    Mr. Kass. Yes, and then I would add to it the ones that we 
do, there is a male bias to it, and we need to figure out how 
to get that neutralized as well. So I would point you in the 
direction of how we get that fixed.
    Senator Booker. Great.
    Dr. Edelstein, do you have anything to add, especially port 
efficiency is something that even the Secretary of 
Transportation and I have talked about, about how in the 
Northeast people are choosing to use Canadian ports because 
they are more efficient than ours are. Is there anything that 
other countries are doing in terms of the Internet of Things 
for freight logistics that we could be learning from here and 
catching up on?
    Dr. Edelstein. Other countries' freight----
    Senator Booker. I'll tell you what, Dr. Edelstein, let me 
move to my last question and try to get it in 10 seconds each. 
If you had a government dollar, if we were going to be 
investing, where would you focus your government dollar, Mr. 
Davis, in terms of getting the biggest return?
    Mr. Davis. As I said earlier, I think creating these 
partnerships and these opportunities to really move technology 
forward, between the private sector, the regulators, and 
academia.
    Senator Booker. Jordan?
    Mr. Kass. It may surprise everybody, but it would be 
infrastructure.
    Senator Booker. Be more specific?
    Mr. Kass. Specifically, the road infrastructure. If I 
painted a picture of the United States, and I showed you the 
traffic flows around the United States, you would see very 
clearly on a map where those arteries were unbelievably 
constricted in major cities around the world.
    And there is a trend of urbanization. It is clear. There 
were 10 megacities, cities over 10 million in population. There 
were 10 megacities I believe 10 years ago. Now there are 23. 
People are moving into cities because they need access to 
products. That trend is clear.
    If we don't fix the infrastructure, whatever we do with the 
Internet of Things is just going to expose the fact that we 
don't have the infrastructure to move the flow of goods 
properly.
    Senator Booker. Tax reform, infrastructure investment. I 
really like you, Mr. Kass.
    [Laughter.]
    Senator Fischer. Thank you.
    Senator Blumenthal?

             STATEMENT OF HON. RICHARD BLUMENTHAL, 
                 U.S. SENATOR FROM CONNECTICUT

    Senator Blumenthal. Thank you very much. Thanks for your 
help and your service.
    Because we have a vote, I'm just going to ask you one quick 
question. Positive Train Control, what can we do to achieve it 
more quickly and implement it around the country?
    Mr. Monje. Well, I will start. Thank you, Senator. We've 
been pushing positive train control, and thank you so much for 
your leadership on this issue.
    I think we are very excited at the Department of 
Transportation that we have $199 million to spend thanks to the 
FAST Act to help commuter rails get on board. There are still 
significant challenges across the rail industry to implementing 
this, including access to spectrum, including equipment issues.
    We are doing everything we can. We are working with the 
FCC. We are working with the class ones. We are working with 
short lines, with commuter rails. We are doing everything we 
can to hold their feet to the fire and to make sure we get this 
technology deployed quickly and safely.
    We know that technology would've prevented the crash in 
Philadelphia. The opportunities for safety are substantial, and 
we are dedicated to this technology.
    Senator Blumenthal. Any other thoughts? How about sensors 
at rail-grade crossings? These are practical, rail safety 
measures that will save lives.
    Dr. Edelstein. Yes, I think it's an excellent idea. 
Unfortunately, it takes probably a good mile or so for the 
train to slow down to get to the point where that person that 
might be in the railroad crossing would avoid getting hit.
    I live in Florida. We just had an incident like that last 
week, where a family of four was at the railroad crossing. 
Three of them got out, but one of them got hit by the train.
    The communications need to be, obviously, with the driver 
of the train. To bring it back to the control center wouldn't 
give you enough time to react.
    In urban areas where you have railroad crossing spaced 
three or four per mile, it becomes a real tricky situation. Now 
with the Internet of Things, this might be able to be managed a 
little bit more efficiently than the way we used to do it in 
the past.
    But I think there is a lot of upside potential in 
addressing these issues in railroad crossings.
    Senator Blumenthal. Thank you all.
    Thank you.
    Senator Fischer. Thank you, Senator Blumenthal.
    I want to thank the witnesses for being here today. I think 
we had a great hearing, and I appreciate your answers.
    The hearing record will remain open for 2 weeks. During 
this time, Senators are asked to submit any questions for the 
record. Upon receipt, the witnesses are requested to submit 
their written answers to the Committee as soon as possible.
    With that, the hearing is adjourned.
    [Whereupon, at 11:06 a.m., the hearing was adjourned.]

                            A P P E N D I X

 Response to Written Question Submitted by Hon. Richard Blumenthal to 
                         Hon. Carlos Monje, Jr.
    Question. In 2008, Congress passed the Rail Safety Improvement Act, 
which required DOT to issue regulations ensuring that each passenger 
and freight railroad develop and implement a Risk Reduction Plan ``to 
reduce the numbers and rates of railroad accidents, incidents, 
injuries, and fatalities.'' One of the components mandated within the 
Risk Reduction Plan was a Technology Implementation Plan. The 
Technology Implementation Plan requires railroads to specify how they 
will use ``current, new or novel technologies'' to reduce safety risks.
    The 2008 law mandated these regulations governing Risk Reduction 
Plans--including Technology Implementation Plans--by October 2012. 
Almost four years since the deadline, there are no final rules ensuring 
railroads have these plans that incorporate technology into their 
safety practices.
    Mr. Monje, the premise of this hearing is that new technology can 
enhance safety. Congress mandated that DOT take action to ensure 
railroads are using technology to save lives. That mandate is 
outstanding. When will the Department of Transportation carry out the 
Congressional mandate? When will each railroad be required to have a 
Technology Implementation Plan?
    Answer. The Department's Federal Railroad Administration (FRA) has 
initiated two rulemakings to implement this mandate: the System Safety 
Program (SSP) rulemaking for commuter and intercity passenger railroads 
and the Risk Reduction Program (RRP) rulemaking for Class I railroads 
and railroads with inadequate safety records. Both rulemakings would 
require certain railroads to develop and implement an SSP or RRP to 
improve the safety of their operations. As part of its SSP or RRP, a 
railroad would be required to set forth a technology implementation 
plan. To ensure commuter and intercity passenger safety is achieved 
through an informed rulemaking process, the Railroad Safety Advisory 
Committee (RSAC) assisted FRA with both rulemakings. The SSP final rule 
was issued on July 29, 2016 and is expected to be published in the 
Federal register soon.
    An advance notice of proposed rulemaking for the RRP rulemaking was 
published in the Federal Register on December 8, 2010. 75 FR 76345. Two 
public hearings were held in July 2011. The RRP NPRM was published 
February 27, 2015 with the comment period ending October 21, 2015. 80 
FR 10949 & 80 FR 60591. FRA held a Public Hearing on the RRP NPRM on 
August 27, 2015. Once again, in an attempt to develop an informed final 
rule, the RSAC's Risk Reduction Working Group met on September 29, 2015 
to review and discuss comments submitted in response to the NPRM. FRA 
is currently drafting the RRP final rule.