The roots of our current crisis lie in our failure as a nation to fully understand and, more important, act on the costs of deferred investment in our surface transportation infrastructure, especially in the face of an aging infrastructure, a growing population, and an expanding economy. From 1980 to 2006, the total number of miles

traveled by automobiles increased 97 percent and the miles traveled by trucks 106 percent. Over the same period, the total number of highway lane miles grew a scant 4.4 percent—meaning that over twice the traffic was traveling on essentially the same roadway capacity. And that says nothing about the mounting neglect of the system: over half of the miles that Americans travel on the federal-aid highway system are on roads that are in less than good condition, more than one- quarter of the nation's bridges are structurally deficient or functionally obsolete,¹ and roughly one-quarter of the nation's bus and rail assets are in marginal or poor condition. ²

Traffic congestion in many of the nation's metropolitan areas is endemic, with the cost of congestion—including lost time, wasted fuel, and vehicle wear and tear—topping $78 billion per year for the nation's 437 urban areas.³ Transit ridership has recently surged, leaving some systems operating near or beyond their physical capacity. Many rural areas currently do not have any transit services and in areas that do have service the quality and coverage are inconsistent.

The federal government does not bear sole responsibility for the current crisis. All levels of government are failing to keep pace with the demand for transportation investment. Increasingly, policy makers at all levels must use existing revenues simply to attempt to keep pace with the preservation and maintenance of an aging system, leaving few or no resources for vitally needed new capacity and improvements to the system.

An ever-expanding backlog of investment needs is the price of our failure to maintain funding levels—and the cost of these investments grows as we delay. Without changes to current policy, it is estimated that revenues raised by all levels of government for capital investment will total only about one-third of the roughly $200 billion necessary each year to maintain and improve the nation's highways and transit systems. (See Exhibit ES-1.) At the federal level, the investment gap is of a similar magnitude, with long-term annual average Highway Trust Fund (HTF) revenues estimated to be only $32 billion compared with required investments of nearly $100 billion per year. (See Exhibit ES-2.)⁴

• Urban travelers are delayed in rush hour traffic nearly one week (40 hours) per year, and in total Americans spend 4 billion hours per year stuck in traffic.

• As of 2006, over half of the total vehicle miles traveled on the overall federal-aid highway system occurred on roads that were in less than good condition, many of which are in rural areas that connect these regions to each other and to urban centers.

• Due in large part to ridership growth, many existing transit systems are operating near or in excess of their physical capacity and above a level that provides acceptable passenger comfort and safety.

Sources: TTI 2007 Urban Mobility, FHWA 2006 C&P, TCRP 2008 State and National Public Transportation Needs.

This problem will only worsen until Congress addresses the fundamental fact that current HTF revenues are inadequate to support current federal program spending levels. Comparing estimates of surface transportation investment needs with baseline revenue projections developed by the Commission shows a federal highway and transit funding gap that totals nearly $400 billion in 2010-15 and grows dramatically to about $2.3 trillion through 2035. (See Exhibit ES-3.)

The problem, however, is not simply insufficient investment. Our system is underpriced. Basic economic theory tells us that when something valuable—in this case roadway space—is provided for less than its true cost, demand increases and shortages result. Short- ages in our road system are manifested as congestion. All too often the prices paid by transportation system users are markedly less than the costs of providing the transportation services they use (including pavement repair)—much less the total social costs (including traffic congestion and pollution). This underpayment contributes to less efficient use of the system, increased pavement damage, capacity shortages, and congestion.

If the federal government fails to act now, and to act dramatically, we will only compound these problems for future administrations and Congresses and for the next generation of Americans. We will face increasingly deteriorating roadways, bridges, and transit systems. We will suffer from more accidents and fatalities on our transportation system. We will endure ever greater spans of our lives stuck in traffic, wasting our time and robbing our businesses of vital economic activity and productivity. We will waste non-renewable petroleum and harm our environment unnecessarily. And, finally but importantly, every day of delay is a day when inflation, neglect, and inefficient use waste scarce taxpayer and system-user dollars.