Desperate for freeway funds, transportation commission mulls all bad options

ODOT’s Urban Mobility Strategy has pushed the agency’s finances to the brink.

Because the State of Oregon has routinely over-committed to building freeway expansion megaprojects without the means to pay for them, its transportation department now finds itself with only bad choices. But instead of internal management shifts, cutting back or pausing those projects, or asking Oregonians to pay more for the privilege of using them, they might go even further into debt and/or raid the coffers of vital, already-funded projects in order to maintain business as usual.

On the chopping block are road maintenance, bridge seismic retrofit, public transit, and bicycling and walking projects.

That was the shocking scenario presented to members of the Oregon Transportation Commission at their meeting Thursday where they were asked to advise Oregon Department of Transportation staff on how to move forward on two key projects after tolling plans the agency was counting on to pay for them were scrapped by Governor Tina Kotek two months ago.

At Thursday’s meeting, commissioners got a presentation about ODOT’s Urban Mobility Strategy, an ambitious plan that includes five major freeway projects in the region and carries a price tag of about $7 billion.

“We’re in a pickle, because we’re spending more than we expected to spend, and we’ve probably got a real credibility problem around the state,” said OTC Commissioner Jeff Baker at the meeting. “It’s a really hard choice, and there are no good answers,” Commissioner Sharon Smith added.

ODOT’s I-5 Rose Quarter and I-205 Abernethy Bridge projects are in need of an estimated $1.5 billion in additional revenue to be completed, and because they both have serious political inertia at the moment (the Rose Quarter has VIP status at USDOT thanks to Albina Vision Trust and Abernethy is already under construction), ODOT is desperate to keep these snowballs rolling down the hill.

And with no money on hand, the choice is to either delay funding of other, already-promised projects, or plunge ODOT further into debt — a massive black hole the agency already throws one out of every four dollars into.

While the Rose Quarter has made recent headlines for winning $488 million in federal grants, that amount is nowhere near its $1.9 billion estimated price tag. ODOT announced at the meeting yesterday that since the USDOT already awarded Oregon $450 million for the Rose Quarter through its Reconnecting Communities & Neighborhoods (RCN) grant, the project is now automatically on a “highly recommended” list for the federal INFRA grant program that could net ODOT another $750 million. That prospect has ODOT and members of the OTC and Oregon Legislature salivating.

The catch with the INFRA grant is that it requires a 40% match — 20% of which must be paid by ODOT (the other 20% will be paid with funds from the aforementioned RCN grant), and they’ve already applied for the grant even without having the estimated $250 million local match secured.

And even if ODOT won another $750 million grant for the Rose Quarter, they’d still be unable to finish the project. At yesterday’s meeting, ODOT Urban Mobility Office Director Brendan Finn said with the money from the three federal grants and other revenues on hand, they’d be able to finish the highway cover, build all the I-5 freeway safety and operational improvements, and construct a bicycle/pedestrian bridge over I-5 south of NE Weidler. But to tie the new lanes into I-405 and I-84, they’d need an additional $300 million.

So as it stands today, even if ODOT won the $750 million federal INFRA grant, they’d still need to come up with at least $600 million to complete the I-5 Rose Quarter project — the $250 million in matching funds and $350 million to finish the freeway elements.

To finish the $750 million Abernethy Bridge project, ODOT needs another $304 million.

To climb out of this hole, ODOT Assistant Director for Revenue, Finance and Compliance Travis Brouwer asked the OTC what they should do.

“First, should ODOT repay some of the funding that was transferred from the Rose Quarter to I-205, or just focused on closing the funding gap for the I-205 Abernethy Bridge project? And second should the funds that are needed to close this gap come from making cuts by deferring projects in the 2024-2027 STIP [Statewide Transportation Improvement Program, a list of funded projects] or do you want to spread out those reductions over the next 12-25 years by covering the gap through bonding or do want to do some combination thereof?”

Another way to handle the shortfall is to scale-back projects to reduce their cost, but that option wasn’t talked about much. When Brouwer mentioned, “opportunities to look for value engineering and scope modifications,” he was quick to remind OTC members that that’s, “always a very challenging conversation both with with ODOT and with partners on the projects.”

No OTC members offered ideas to reduce the scope of the planned freeway projects, but there were several comments that questioned the need for the estimated $70 million bicycle and pedestrian bridge planned over I-5 near Moda Center. “The bicycle path has nothing to do with the original plan,” remarked OTC Commissioner Lee Beyer, who then said Portlanders should support it more if it’s truly that important.

If the OTC advises ODOT to take money already allocated toward the upcoming STIP, they’ll have to decide which specific projects get delayed. A list of hundreds of bridge maintenance, seismic renovations, and bicycle and pedestrian projects that are on the chopping block were made available in the meeting packet.

“It’s clear just from looking at the list, closing the gaps will lead to deferring projects and will be very painful,” Brouwer shared. “We have about $600 million in bridge projects that are shown on this list, so you’d be potentially getting rid of almost all of those bridge projects in this coming STIP.” “Of course there’s going to be serious concerns from those communities and from those interested parties,” he added in a major understatement.

While commissioners were not eager to address this funding conundrum, ODOT staff pressed for guidance. In the end, they agreed to continue with the federal INFRA grant application and just hope that they could come up with the $250 million required local match. “If they give us the grant, we’ll find the money,” Commissioner Beyer said, confident the legislature would not want to refuse $750 million.

“I think given the indications we have from the Feds that they’re willing to put the money on the table, we will be imprudent in not asking for that,” he added. And OTC Chair Julie Brown agreed: “It isn’t very often you get a congressional push behind a project like this.”

But Commissioner Smith shared concern. “We’d be committing $600 million to complete the Rose Quarter, and we don’t know where that money’s going to come from. And then we are already under contract to complete Abernethy Bridge, so we don’t have a choice there,” she said. “… Continuing to agree to spend money we know we don’t have is very concerning.”

“From a business sense, it doesn’t make sense that you commit to something when you don’t know where you’re going to find the funding,” Chair Brown replied. “But this is the way our government works. It’s crazy. And now it puts us in a place where we have to work 10 times harder to make those sacrifices.” Brown feels these hard choices should encourage people to reconsider tolling to help raise funds.

ODOT Director Kris Strickler popped into the meeting to share his thoughts, saying he doesn’t recommend delaying any planned STIP projects to fill the gaps. He thinks the path forward is a financing plan and to lobby the legislature for a bailout in 2025. Strickler is confident that lawmakers will want to “complete the unfinished business of HB 2017 [the previous infrastructure spending bill]” and that the only remaining business is to fully fund the Rose Quarter project.

Finding money will be hard for ODOT and the legislature, but finding support from Oregonians for whatever course they choose, might be even harder.

At the end of the meeting, after hearing that giving ODOT another $300 million in bonding capacity would cost taxpayers about $22 million a year, OTC Chair Brown said, trying to muster some optimism, “It’s doable. I’m smiling at the State Senator in the back of the room. It’s doable.”

Jonathan Maus (Publisher/Editor)

Jonathan Maus (Publisher/Editor)

Founder of BikePortland (in 2005). Father of three. North Portlander. Basketball lover. Car owner and driver. If you have questions or feedback about this site or my work, feel free to contact me at @jonathan_maus on Twitter, via email at maus.jonathan@gmail.com, or phone/text at 503-706-8804. Also, if you read and appreciate this site, please become a supporter.

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Andrew N
Andrew N
9 days ago

It’s hard not to laugh at these irresponsible clowns. What a bed they’ve made while shutting out all sound advice. Incredible that there is so little we can do outside of direct action, which will necessarily become more spectacular as the unraveling of our world proceeds at a quickening pace. Good luck. Don’t have kids.

https://www.theguardian.com/environment/article/2024/may/08/world-scientists-climate-failure-survey-global-temperature

David Hampsten
David Hampsten
9 days ago
Reply to  Andrew N

It’s hard not to laugh at these irresponsible clowns and those who appointed them, and the idiots who elected the irresponsible clowns in Salem.

Will the last bike commuter turn off their lights
Will the last bike commuter turn off their lights
8 days ago
Reply to  David Hampsten

It’s so bloody ‘murrican to pretend that ‘murricans have no agency or culpability for the genocides and ongoing ecocide their communities have perpetrated.

Fred
Fred
9 days ago
Reply to  Andrew N

Hear hear. We’ve been told all along that the RQIP will actually make cycling better – and now they want to cut the one bridge that they promised to build? Not on your effin’ life.

X
X
8 days ago
Reply to  Fred

Cycling ain’t broke. I like a nice bike accessible bridge as much as the next person but I’m not going to hold out for a $70 million bridge if it means putting the state of Oregon on the hook for about $2 billion of bond payments.

The Blumenhauer bridge seems defensible to me because besides linking a bikeway it provides a state of the art alternate route for emergency vehicles in case of a major earthquake. Also it was not linked to a 20X or 50X multiple of other spending.

I’d be happy to have a bike bridge stand or fall on its own merits instead of being an appendix to some other huge thing so that to get seventy million to spend on bike infrastructure we have to favor billions of dollars worth of concrete and steel with no budget to maintain it.

John V
John V
8 days ago
Reply to  X

But that’s not the discussion on the table. They’re talking about making the 2 billion dollar boondoggle insignificantly cheaper by cutting the bridge. I’d much rather they not widen the freeway, but if they do, they damn well better build that bike bridge.

dw
dw
9 days ago

Serious question: why not raise gas taxes and vehicle registration fees to cover the shortfall?

dw
dw
9 days ago

Lol. It’s ok the kids will pay for it!

Serious follow-up question: to what extent would they have to raise gas taxes and registration fees to cover the cost of their highway projects?

David Hampsten
David Hampsten
7 days ago
Reply to  dw

to what extent would they have to raise gas taxes and registration fees to cover the cost of their highway projects?

The problem with any answer is that once you arrive at it, the list of projects will keep expanding by that amount, it’s a never-ending vicious cycle often referred to as deficit financing (see the Robert Moses thingy below). The more revenue you raise, and the more types of revenue you raise for transportation, the more ambitious you get to build more crap.

In most cases, you are far better off not knowing the answer.

1kW
1kW
5 days ago
Reply to  David Hampsten

I disagree, people paying, for example, $4 a gallon gas tax would 1. Buy less gas 2. Have all the more reason to not continue raising such a rate because the demand for the infrastructure is less, because they are driving less, and buying less gas ….etc and so on… Im not saying $4 a gallon is the “magic” number…. but I feel we aren’t close to an appropriate rate and with significant hikes , there would be a natural balance reachable….like a position feedback loop…( at ,east until the rioters burned down the government over said tax)

JG
JG
6 days ago
Reply to  dw

The current gas tax is $0.40 a gallon, and that brought in over $600 million the last couple years. There are some caveats in that aviation fuel and others are taxed differently, but using that basic math, you’d need to double the tax to get another $600 million. Registration fees are similar, they would need to double and they would come close to filling the gap (about $450 million).

John V
John V
9 days ago
Reply to  dw

It’s mind boggling. “Here’s an expensive project that we’re doing because people want to use it, but we can’t just raise the funds to pay for it. That would be foolish.”

It should be the easiest sell in the world, if indeed widening the highway and the other megaprojects are popular with the general public. If they’re not, I don’t know why they don’t take that hint. If people don’t want to pay for it, they don’t want it bad enough.

Chris Smith
Chris Smith
9 days ago

Someone needs to educate the Commission that the bicycle bridge goes all the way back to the 2012 Facilities Plan. They tried to remove it in the Supplemental EA redesign but got pushback.

Allan
Allan
8 days ago
Reply to  Chris Smith

Came here to say this. It was “only” 20M at the time. The bridge has very minimal bike function.

JaredO
JaredO
9 days ago

This is the Robert Moses approach.

Promise the world. Pretend it’s going to be cheap. Lie outright to legislators to fund it. (Bent Flyvbjerg has documented this across the world).

Get something started, be shocked-shocked! that it costs more than you claimed, then make everyone feel like it would be a waste to stop it.

Steal money and projects from the least powerful people in a community. Pretend there are no opportunity costs.

The whole conversation makes me sick.

As a side note, if we don’t value something enough to pay for it, and are only doing it because the federal government will pay for most of it… we’re making the wrong decisions.

Perverse incentives from the feds means safety – road maintenance – and transit, walking, and biking projects will be destroyed. ODOT claims safety is their top priority. This is exhibit #1,412,342 on why that’s simply not true.

It’s time to provide real leadership and avoid sunk-cost fallacy.

Cancel the projects. Keep the commitments to the Oregonians around the state who need safety and choices. We’ve done it before. Time to do it again.

1kW
1kW
5 days ago
Reply to  JaredO

C.O.T.W.

Lisa Caballero (Assistant Editor)
Editor
Reply to  1kW

1kW, great minds think alike. It ran as cotw two days ago.

SD
SD
9 days ago

“It’s just crazy how the government works…” as they pressure a legislator in the back of the room to do something we’ll all regret.
The people on the OTC are entirely unqualified to make important decisions.

David Hampsten
David Hampsten
9 days ago

The project list looks a lot like a state legislators’ list of pet projects. And I’m pretty sure the state commissioners are fully aware of that.

A $400,000 highway sign versus a $10,900 bike path?

Guess Who
Guess Who
9 days ago

Lee Beyer didn’t have solutions when he was Senator. He was about to get voted out of office before he stepped into the OTC role. He’s a failed transport leader with delusional obsession driving ODOT and Oregon infrastructure [into the ground]. Kotek should ask him to resign. He’s clearly too senile to do the math. Any state legislative transport funding package he has a hand in will fail. Guaranteed to be an another colossal failure and waste of time with his fingers in the pie. Strickler and Beyers should get pink slips for this fiasco we predicted a decade ago.

SD
SD
9 days ago

It should be called the “Kill urban mobility to bolster wasteful suburban and exurban mobility strategy.”

X
X
8 days ago

It’s interesting to me that one of the _smaller_ numbers in this article, $450 million, is also the stated cost estimate for the RQ freeway widening when it first came over the horizon. From a distance it looked like a boondoggle but it turns out what we could see was only the head of the monster.

Is it too much to ask of ODOT and the utterly failed OTC that they bring proposals that have real price tags? That they have a strategy for reducing the scale of a project instead of a wishful plan to extract three times the stated budget? We’ve spent real money preparing for this freeway widening but there’s nothing in place that would keep us from just shutting it down.

It’s on Tina Kotek right now to boot the people who created this mess and replace them with some bodies who understand that $100 million, or $1 billion, is a lot of money to add onto the bill for a thing that many of us never wanted and do not need.

“On the chopping block…bridge seismic retrofit…” –more than 30 of them. You don’t have to be in favor of active transportation to be appalled by this. Bridges knit together the bits of pavement that ODOT builds and maintains. All that is useless if you can’t cross a river or a railroad cut. ODOT and the OTC are seriously proposing to let the bridges etc. go, to pursue a vainglorious project that may or may not take a few minutes off a trip to Vancouver.

Art Lewellan
Art Lewellan
7 days ago

OH MY GOD! The word klusterf*ck came to mind after analyzing this latest ODOT design for the Rose Quarter. 1) The hazardous southbound on-ramp will remain at Wheeler Way. 2) The southbound exit “hairpin turn” DEATH TRAP to Wheeler Way remains plus a new hairbrained 180 degree overpass exit to Weidler further compounds the insanity at ODOT. A new ped/bike lane will accompany this idiotic overpass, no doubt to persuade cyclists it’s necessary. I swear to God, Kris Strickler, Lynn Peterson, Ted Wheeler and various agency department heads and project managers should be indicted and face criminal charges of Reckless Endangerment AND Negligent Homicide with secondary criminal charges of “Willful concealment of safety concerns from the public”, and “Misdirecting project studies to predetermined outcomes, principally inappropriate but lucrative development.”

Art Lewellan
Art Lewellan
5 days ago
Reply to  Art Lewellan

Jonathan, opposition to the Rose Quarter I-5 so-called “Improvement” is led by those who decry “induced demand” correctly, but this shouldn’t displace “Public Safety” as the leading cause of concern. If ODOT, Metro and other agency leaders, department heads and project managers either ignore or downplay public safety knowingly putting the public in harm’s way, they can and should face criminal charges of “Reckless Endangerment” “Willful concealment of safety concerns” and when traffic hazards are made worse by inherent flaws in proposals like the Rose Quarter and the SW Corridor MAX extension to Tigard, these agency leaders should be indicted and face criminal punishment for “NEGLIGENT HOMICIDE” as well. Strickler and Peterson are turning a blind eye on public safety to serve the interests of developers and automobile-related business interests.