Friday, March 7, 2014

Ken Orski: A 21st Century Approach to Transportation Funding

As states acquire more familiarity with credit transactions and develop more capacity to pursue public-private partnerships, and as federal budgetary constraints continue, long term financing of new transportation facilities and of multi-year reconstruction programs could become the states’ primary method of expanding and modernizing aging infrastructure. At the same time, states' growing fiscal independence points to a new approach to funding the nation's transportation needs in the 21st century. 

In this prospective new model, routine highway maintenance and system preservation would continue to be funded on a pay-as-you-go basis with current state and local tax revenue as supplemented with federal-aid highway dollars from the Highway Trust Fund . However, capital-intensive multi-year reconstruction programs and new capacity expansion projects ---investments that are beyond the states' fiscal capacity to fund out of current revenue --- would be financed largely through public-private partnerships employing long-term credit and availability payments. 
Provision of credit would remain a shared responsibility of the public and private sectors. Private Activity Bonds, the TIFIA program and State Infrastructure Banks would continue to serve as the main public sources of credit assistance while additional public credit facilities could be created, if need be, to handle a growing backlog of reconstruction needs. Potential candidates include Sen. Mark Warner's National Infrastructure Financing Authority (IFA) and Rep.John Delaney's $50 billion American Infrastructure Fund (AIF). The latter proposal would capitalize the AIF by selling bonds to U.S. companies. In exchange for purchasing the bonds, companies would be able to repatriate a portion of their overseas earnings tax-free. (A somewhat similar approach forms part of Rep.Camp's tax reform proposal).

The Highway Trust Fund--- freed from the obligation to fund new infrastructure and large  reconstruction programs on a cash basis---would be placed on a more stable financial footing, while an ample supply of long-term credit ---both public and private---would reduce the need for contract authority and multi-year transportation authorizations. Meanwhile, states and localities would gain more independence to plan and fund infrastructure improvements on their own terms, free of excessive federal regulatory oversight.
It's a highly plausible answer in our judgment to the nation's search for a long-term solution to the infrastructure funding problem.  

Earlier versions of this commentary were presented at the Transportation Research Board workshop,  "States are leading the charge on transportation revenue initiatives," January 12 2014; at the Conservative Policy Summit of the Heritage Foundation on February 10, 2014; and in a Governing magazine interview dated February 27, 2014.


Kenneth Orski
Editor/Publisher
Innovation NewsBriefs (celebrating our 25th year of publication)

Tuesday, January 28, 2014

Free transit: A case study from Estonia

SOURCE: Free public transit in Tallinn is a hit with riders but yields unexpected results

In January 2013, Tallinn, the capital city of Estonia, did something that no other city its size had done before: It made all public transit in the city free for residents.

Researchers at the Royal Institute of Technology in Sweden found modest results.
  • They calculated an increase in passenger demand of just 3 percent — and attributed most of that gain to other factors, such as service improvements and new priority lanes for buses. In their analysis, free pricing accounted for increased demand of only 1.2 percent.
  • Traffic speeds in Tallinn had not changed — a sign that drivers were not shifting over to riding transit as intended.
  • If any modal shift is happening, it’s that some people are walking less and riding transit more.
All this at a city with far lower income and far lower auto ownership than most of the EU and the US.  Meanwhile fare box revenues have been lost.

Bottom line: Free public bus fares are a losing proposition even in transit dependent first world cities.

By the way, this was a Social Democrat proposal that, once a suitable mayor was elected, went to effect.
January, Tallinn, the capital city of Estonia, did something that no other city its size had done before: It made all public transit in the city free for residents. - See more at: http://citiscope.org/story/2014/free-public-transit-tallinn-hit-riders-yields-unexpected-results#sthash.uhflpuH4.dpuf

Household Electricity and Solar Panels

This brief analysis is a simple case of a picture is worth one thousand words.


The GREEN line is our house's monthly electricity consumption which averages about 450 kilo-watt-hours or KWh.

The ORANGE line is our house's monthly solar panel electricity production which averages about 250 KWh.

To make them directly comparable both averages were normalized to the level of 100. Also these were further smoothed to account for HECO's accounting variability because some monthly bills include as few as 28 days or as many as 33 days. So power consumption was estimated on a per day basis and then converted to a monthly basis.

What is there to observe?  Simply that the solar (renewable electricity) production profile is not at all in tune with our household's monthly electricity consumption. Humid days call for more A/C use, Christmas celebrations call for more lights and cooking, summer months take us to vacations or time away from home, but the sun's trajectory and cloud density do not follow any of these habits.

The lesson on a grand scale is that a city, state or country cannot possibly depend on renewables such as wind and sun for more than a small fraction such as 10% for its power generation because of significantly negative productivity, health and safety implications.

One must be a great fool to believe that the large deviations shown in the graph (which can be extreme on an hour-by-hour basis) can be covered by ... batteries.

On the other hand, renewables from geothermal, nuclear and tidal wave harnessing are in a different class and can offer base-load reliability that covers the fluctuating needs of a large population concentration. But even them they need supplementation by true base load power generation from nuclear, coal, oil or natural gas power plants. As mentioned in an earlier article, waste-to-energy for Maui, natural gas for Oahu and geothermal power plant development on the Big Island are best near term choices for Hawaii.







Friday, January 24, 2014

What do Americans Think About Federal Tax Options to Support Trasportation?

A long term study at the Mineta Transportation Institute at San Jose State University contains a number of interesting findings:
  • A majority of Americans would support higher taxes for transportation—under certain conditions. For example, a gas tax increase of 10¢ per gallon to improve road maintenance was supported by 67% of respondents, whereas support levels dropped to just 23% if the revenues were to be used more generally to maintain and improve the transportation system.
In other words, people are tired of potholed and rutted pavements.  Fix it and stop the "system" talk which in most cases are more union bureaucracies or projects custom-set for special interests and favors.
  • With respect to public transit, the survey results show that most people want good public transit service in their state. In addition, two-thirds of respondents support spending gas tax revenues on transit. However, questions exploring different methods to raise new revenues found relatively low levels of support for raising gas tax or transit fare rates.
See the point below. Most people want "good transit" because they think it costs a couple bucks per trip whereas the reality is much different and nationally the cost per trip on transit is over $10. How many people in San Francisco know that large portion of BART is over 30 years old and its refurbishment requires over $3 Billion?
  • Not all respondents were well informed about how transit is funded, with only about half knowing that fares do not cover the full cost of transit.
I think that "about half" is a huge underestimation.  Only a small fraction of Honolulu's population knows that the average trip revenue on TheBus is about $1.50 but the actual average cost per trip is over $6.00.

Friday, January 17, 2014

Preserving the American Dream: Lessons in Beating Boondoggles

A summary by Gini David.

In late October, I attended the Preserving the American Dream conference in Washington DC, sponsored by the American Dream Coalition (ADC, http://americandreamcoalition.org), a  coalition that promotes freedom, affordable home ownership, property rights, and mobility. To combat big government boondoggles, the ADC provides strategic and tactical counsel from planning experts like Randall O’Toole (Cato Institute), demographer Wendell Cox, ADC’s executive director Eileen Bruskewitz, transit expert Tom Rubin, ethics analyst and writer Stanley Kurtz, and others.

...

What’s more, Panos Prevedouros, a professor of transportation engineering at the University of Hawaii, told the ADC audience that rail projects are rife with corruption and fraud, quoting   Bent Flyvbjerg, the renowned Chair of Large Program Management at Oxford University:  “Rail projects are the projects most fraught with delusion and deception.” As Prevedouros explained, “Deception because proponents lie to constituents and overstate ridership and understate costs.  And delusion because proponents believe that their projects are better and different than other failures from the past.”

Friday, January 10, 2014

Honolulu Traffic Contraflow Operations

The Honolulu Civil Beat article Finding the City's Flow: Why Honolulu's Traffic Goes Against the Grain summarizes the state of contraflow in Honolulu. Contraflow on lanes during peak traffic periods is a practice that is used extensively both by the city and state transportation agencies to squeeze more capacity out of the lane-deficient road network of Honolulu.

I wish that the city had actually something more useful to say. Their comment about potential future contraflows on Dillingham Blvd. and King St. is borrowed from my mayoral campaigns during which I promoted these ideas. At least they are on record that the rail won't reduce the need for contraflow lanes.



The city's practice of using crews and cones is relatively risky for the crew, and expensive. The photo is from the Honolulu Star Bulletin newspaper in an article dated Tuesday, August 24, 1999.


Tuesday, January 7, 2014

AIKEA FOR HONOLULU No. 33 – American History 2000-2016: Early Summary of the Barack Bush* Era in 200 Keywords



  • 9/11, Al-Qaeda, Taliban and IEDs.  Patriot Act, TSA, Homeland Security, drones. WikiLeaks and the Snownden-NSA leaks.
  • Appointed Czars: Bush 33, Obama 38.  Executive orders: Bush 146, Obama 147. (First term only.)
  • TEA Party and Occupy Wall Street. Universal Health Care (Obamacare) and Sequester. Debt ceiling.
  • Bailouts and cash-for-clunkers.  Retro cars: Mini, VW Beetle, PT Cruiser, Chevy SSR, Toyota GT86.
  • Big Presidential lies: “Saddam has WMDs” and “You can keep your plan.”
  • So long Ronald Reagan, Steve Jobs and space shuttle.
  • Gates Foundation. Gay marriage. GMO labeling.
  • Kyoto protocol, and (less) global warming.
  • “Smart Growth” and “Livability” = Pack people in condos and trains. U.N. Agenda 21.
  • I-35W bridge collapse. D grade for Infrastructure. Hurricane Katrina, BP Deepwater Horizon.
  • Green energy black holes: Electric car/Fisker, solar/Solyndra, corn ethanol and wind farm subsidies.
  • Oil at $147/barrel in mid-2008. Frack it! Natural gas to the rescue. Keystone XL pipeline.
  • Infrastructure finance, PPP, open road tolling, road concession, EZPASS, HOT lanes.
  • Google car and Google glass. Toyota Prius, Twitter, and tablets. Nanotechnology, carbon fiber, and composites. 
  • Boom: Android, Bitcoin, e-cigarettes, iMac, iBook, iTunes, iPod, iPhone, iPad, Made in China, Marijuana,  Facebook, Lipitor, Smart Phones, Tesla car, Viagra.
  • Bust: AOL, AltaVista, Pontiac, Plymouth, Lehman Brothers, BlackBerry, HealthCare.gov (?)
Around 2016: The Baby Boom social security and other social net overloading, the large pension underfunding of several states, and ObamaCare direct and indirect costs come to full bloom (and gloom.)

Notable International: The economies of BRICs and PIIGS *** No “Arab Spring,” Egypt, Syria and Benghazi *** ~270,000 dead by 2004 Indian Ocean tsunami *** 2004 Athens Olympics *** 3/11 Tsunami and Fukushima disaster in Japan *** Castro, Chavez, Gaddafi, Kim Jong-Il and Bin Laden gone *** So long Margaret Thatcher, Nelson Mandela and supersonic passenger flight (Concorde) *** Full double-decker 550-850 passenger A380.



Notes (*): The Economist, Barack Hussein Bush, Dec 17th 2008 *** The Wall Street Journal, Barack Hussein Bush, June 5, 2009
PPP = public-private partnership (or P3)
BRIC = Brazil, Russia, India and China
PIIGS = Portugal, Ireland, Italy, Greece and Spain
This summary does not include Entertainment and Sports highlights.

Monday, December 23, 2013

The Public and Private Versions of Solar Power, in Brief




Private version: The installation of photovoltaic panels to generate electric power utilizes unused rooftops and provides free building cooling. (Y. Hata Co., Honolulu, HI.)







Public version: The installation of photovoltaic panels to generate electric power wastes productive land, wastes taxpayer funds, and lies about sustainable green jobs; there aren't any. (DHHL, Kalaeloa, HI)


Thursday, December 19, 2013

AIKEA FOR HONOLULU No. 32 – Here’s Wishing for a Helmet Law and Jones Act Repeal




The magic of Fibonacci numbers. Simple series. Fascinating creations!

Biologist Mohamed Hijri brings to light a farming crisis no one is talking about: We are running out of phosphorus. (TED talk in French, subtitled.)
 
As 2013 comes to a close it is worth remembering that Honolulu's $5.2 Billion rail project is a testament of the power of government and special interests to get their way.  The Honolulu Civil Beat's multiple polls over the years show that the rail project never had a public approval of over 35%. Here’s a link to a slideshow summary I presented at the ADC conference in Washington, D.C. in mid-October.

My first transportation wish for 2014: Hawaii needs a motorcycle helmet law. It’s a no brainer! Just read these few lines about the impact of injuries of motorcyclists without helmets: “The helmet-less are distinctive, says Dr. Lori Terryberry-Spohr: they suffer ‘diffuse’ internal bleeding and cell death across large areas. Such patients typically run up $1.3 million in direct medical costs. Fewer than a third work again. A study of helmet-less bikers admitted to one large hospital, cited by the Centers for Disease Control, found that taxpayers paid for 63% of their care.”

My second transportation wish for 2014: Hawaii gets an exemption from the Jones Act which artificially inflates the cost of living for all of us. BusinessWeek observes that “when large container ships filled with bicycles and sleeper sofas leave China for the U.S., they don’t stop in Hawaii to unload cargo bound for that state before continuing to Los Angeles or Seattle.” Unfortunately status quo politicians such as Hirono, Schatz and Hanabusa are strong supporters of the Jones Act. And fake energy solutions. They cost Hawaii dearly … expensive gas, expensive power, expensive groceries, and extra taxation on everything for the rail.  Other than that, Hawaii Democrats are all about support for the little guy ;)

Merry Christmas and Best Wishes for 2014!

Wednesday, December 11, 2013

Mayor Enrique Peñalosa: Why buses represent democracy in action

1998-2001 Bogota Mayor Enrique Peñalosa: "An advanced city is not one where even the poor use cars, but rather one where even the rich use public transport."

In this TED talk, the former mayor of Bogotá shares some of the tactics he used to change the system in the Colombian capital.

"Buses have great capacity. For example this system in Guanzhou is moving more people per hour than all subway lines in China, except one in Beijing, at a fraction of the cost."


Friday, December 6, 2013

Senator Schatz is Wrong about Wind Energy -- Part 2: Sample Responses

Most people dislike irresponsible calls for "improvement at any cost" although some accept cost-ineffective renewables. The quotes below are a sample of the responses I received to my AIKEA FOR HONOLULU No. 31.


Alexa: Thank you for the informative email. But I still do not know what we the poor residents can do to help ourselves and Hawaii from the increasing expense.

Patty: They surely are an eye sore.  Did not appreciate seeing them as I toured visiting friends around the island.




Teri H.: “No” to liquefied gas. At some point, someone has to have the courage to advocate and implement renewable energy.

Robert: 3 cents per kw, does that include the cost of Columbia river dams and lost salmon runs?
No such thing as a free lunch but you are right about distributed pv.

Greg W.: Tell them to come to South Point on the Big Island. Are they trying to finish off the Nene and the Io?

John D.: wind energy, in my opinion is better than solar, or at least compliments it. just note all of us who have blue water sailboats- sun by day, and wind by nite- at nite, the sun is gone, but the wind blows, continuing to give energy. i like that. i don't like the idea of huge turbines in my immediate neighborhood, but small individual ones like i mentioned, are fantastic... keeps the beer cold.

Thomas S.: What is wrong with a Babcock and Wilcox 300 MW nuclear plant?  The most ecologically sensitive plant and with power storage that will keep Hawaii lit a for a long time.
        Liquefied Natural Gas is replacing the Kewaunee, Wis. Nuclear Plant that my father helped build in 1960......my mom, still gets 10 cent per KWH retail power out of that plant as of this moment.  (I checked her electric bill).

Bruce: I also agree with you that rooftop solar can make it on its own, without any state or federal tax credits, which are expected to expire in a couple of years.  We were fortunate to take advantage of the credits and our $50K system cost us just $17.5K.  It should pay for itself in 4 years.  Without tax credits, it would still pay for itself in 12 years and, because we purchased well-designed panels, I expect the lifetime to exceed 30 years.  We installed PV panels on our cabin in Colorado 20+ years ago, and they are still working fine...even being exposed to snow.

Patrick P: how about wind turbines, pv, and rain turbines on all erected light fixtures across the state?

Kaniu, Big Island: Mahalo nui Panos for the truth

Linda P.: Panos, we appreciate you!  Thank you for fighting the good fight and for keeping us informed.  Wish the good senator (and many others) had your intelligence, logic and values!

Valere: Thank you for always telling it like it is and for doing such credible research. I do disagree, however, about the PV systems because most of the panels are constructed in China and the mining of materials used in the panels is extremely toxic. Firefighters in California can refuse to fight a fire on building that has solar panels. And these projects survive on subsidies. It is fallacious to say that the tax benefits received by individuals and corporations are not subsidies. It's just a different name for the same thing.

S.V, Pukalani: I speak from looking hard at rooftop solar installations on Maui.  It is a wonderful and economic problem.  The only sticking point here is that Maui Electric has limited the number of penetration circuits allowed for home solar.  Reason - it impinges on their base load generation.

Tim D.: How about something simpler:  Cut demand by tax credits (and building code) for simple, non capital-intensive technologies like insulation, attic fans, and best-practices lighting (Say Energy Star Gold rating).  Mandate homes (single family & up to 4-plexes) convert to solar power hot water over the next decade.

Gordon K., Retired HECO: In November 2012 I attended the Hawaii Health Dept. hearing on Greenhouse Gas regulations.  Everybody was there--Health Dept., engineers, regulators, utilities and refineries, and environmentalists.
     I asked a question.  We live in a highrise apartment, and electricity costs us $200 per month.  I asked how much our electric bill would be after all of the solar and wind farms, rooftop solar, and undersea cables are built.  There was total silence.  A few people pointed up at the ceiling.  Afterward an engineer told me, "That was a novel question you asked.  No one ever asked that question before."
     In other words we all accepted the renewable energy without question or regard for cost.  Now that we're retired and living on pensions, cost matters a lot.  I intend to ask that question a lot more in the future.

Wednesday, November 27, 2013

AIKEA FOR HONOLULU No. 31 – Senator Schatz is Wrong about Wind Energy



A TV ad started last week shows U.S. Senator Brian Schatz promoting “energy that’s moving Hawaii forward. Senator Brian Schatz is leading the effort to harness our incredible wind energy potential with tax credits to grow wind energy production that would create thousands of new jobs and clean energy.”
Hawaii residents from Waianae to Kahuku, from Molokai to Lanai, and everywhere in the between dislike wind turbines. Senator Schatz promotes more taxpayer monies for special interests who are peddling a technology that cannot make it on its own. He is wrong for the following reasons.
Independently from any politics, a Punahou and UH-Manoa graduate student and I conducted detailed research on cost effective energy solutions for Hawaii, by examining all major energy sources available to Hawaii.  A summary of our work was accepted by Pacific Business News last month, and was published this week: Making the Case for Liquefied Natural Gas.
Our research concluded that wind and solar power plants are ineffective; they require multimillion dollar subsidies. The solar energy in our research was the power plant type that consumes land in order to produce some daytime electricity, similar to the 36 acres wasted by the Pohoiki plant at Kalaeloa to produce only 5 MW!
On the other hand, solar photovoltaic panels have been locally accepted by thousands of homeowners and businesses. Rooftop PV is an incremental, distributed power source with near zero visual or other negative impacts for Hawaii, as I explained here: Big Rooftop Solar Panels Make Sense in Hawaii - without Any Subsidies! Rooftop PV supports dozens of local small businesses.
Recently BMW decided to locate its electric vehicle chassis assembly in a region of Washington State because the local electricity rate is 3 cents (!) per kilowatt-hour.  HECO’s rate on Oahu is over 33 cents and thanks to Senator Schatz’s flawed advocacy, our electricity costs will increase, and Hawaii will become increasingly uncompetitive.
I urge Senator Schatz to review the three page summary of our research titled The Next 100 MW Power Plant for Oahu and modify his views about renewable energy. America’s future cannot be supported by intermittent, unreliable and expensive energy.
Hawaii does not need unsightly turbines and cannot afford their cost and flaky reliability. And please stop bragging about the jobs. Hawaii has fewer than 50 turbines and fewer than 50 people are located here to manage them … that is, when the turbines are not down due to fires or other self-inflicted damage.

Friday, November 22, 2013

Technology and Technological Innovations

Technology and technological innovations are presented in this installment of my O'lelo show PANOS 2050: Solutions for a Sustainable Hawaii.

The Economist:  Before 1750, the standard of living improved at a glacial pace, if at all. Farming in the early 18th century was not that different from farming in Biblical times. The Romans had invented plumbing before the very concept was forgotten for millennia. Then, something happened. Within two centuries the biggest material problems of pre-industrial life had been solved: ...

The first wave of major modern technology and innovation consisted of the steam engine, the locomotive and the telegraph.

Second and final big wave of major modern technology and innovation consisted of electrical generators, indoor plumbing and broadcast radio.  Followed by autos, oil extraction and highways.

TV, personal computers and the Internet had modest but not "wholesale" effects on our quality of life and productivity.

Monday, November 4, 2013

Honolulu Rail: 2005-2013 Slideshow

The slide show presentation titled Fighting ● Boondoggles ● Honolulu ● Rail ● Transit was presented at the 2013 American Dream conference in Washington, D.C. in mid-October 2013.  It provides a brief summary of:
  • Honolulu's history of billion dollar transit plans
  • Why is Honolulu Rail a boondoggle?
  • What was done to stop this train?
Honolulu's $5.2 Billion rail project  is a testament of the power of government and special interests to get their way.  As the Honolulu Civil Beat's multiple polls over the years have revealed, this project never enjoyed a public approval of over 35%.


Friday, October 25, 2013

Current Social and Economic Trends

Current major social and economic trends that affect the US and Hawaii are presented in this installment of my O'lelo show PANOS 2050: Solutions for a Sustainable Hawaii. From developments in China to politicians' pay in several countries.