Surface Transportation News: China’s high-speed rail boondoggle

In this issue:

• China’s high-speed rail boondoggle
• Ideas for 2026 surface transportation reauthorization
• Reason Foundation’s reauthorization proposals
• Cost-effective Northeast Corridor proposal
• A P3 option for deficient bridges
• Immigration raids on construction sites
• News Notes
• Quotable Quotes

China’s High-Speed Rail Boondoggle

Last month, I received an email from Zichen Wang of Pekingnology, which is affiliated with the Center for Strategic and International Studies, a think tank in Washington, DC. Attached was a long report by an academic named Lu Dadao of the Chinese Academy of Science. (He is also a former president of the Geographic Society of China, and he has drafted plans for the State Planning Commission.) His lengthy report, translated into English, is titled “The Glory of High Speed Rail: What About Its Problems?” Everyone interested in potential U.S. high-speed rail projects should read this authoritative report.

China’s high-speed rail system began as part of China’s 11th five-year plan, which called for a network of four basically north-south high-speed rail (HSR) lines and four east-west ones. By 2012, there were 18,000 kilometers of such lines, and the 13th five-year plan called for a system totaling 37,900 kilometers—but that was soon superseded by the China Railway Group’s 2021 plan for a 70,000 km system by 2035. However, the soaring costs and growing concerns about bad planning led to an “emergency brake” halt to new lines as of 2022.

What seems to have happened goes beyond extensive overbuilding by the state-owned railroad company. Lower-level governments added numerous (often far too short) links to the system as prestige projects. Over 100 of these too-short lines now exist. According to Lu’s analysis, the vast majority of the HSR “system” (which he terms a “hodge-podge”) loses money, due to low passenger demand. This is partly because a great many stations have been located well outside the centers of metro areas, and without direct local highway or light rail connections. He devotes an eight-page section just to “absurdly located and excessively costly grand HSR stations.”

By the author’s analysis, only six high-speed rail lines (all between major metro areas) break even on operations, and none of them cover more than a small fraction of their construction costs. As of 2023, China’s cumulative HSR debt had reached 6 trillion yuan ($839 billion).

China calls itself a communist country, with decisions about nearly everything decided by allegedly rational central planners. That clearly has not happened with China’s implementation of HSR. The system that has been implemented makes no sense, with numerous short lines that duplicate existing passenger and freight rail service. But the bizarre “planning” goes beyond that. As he notes, “Along several major passenger and freight corridors, the authorities overseeing different modes of transport have each proposed major trunk line projects, yet coordination across sectors remains lacking.” And he adds that “Even among departmental specialists, there is often a lack of objectivity when analyzing and forecasting supply and demand.” And “As a result, transport sectors operate in isolation, stations are constructed on an excessive scale and are increasingly far from residential zones.”

There is an underlying reason for these failures of central planning. It’s explained by a discipline called “public choice theory,” which some have referred to as studying the economics of politics. One of its pioneers, James Buchanan, won a Nobel Prize in economics in 1986 for his role in pioneering this field. In basic terms, public choice theory postulates that public officials are influenced by the same kinds of self-interest as participants in markets. Hence, the interests of planners and bureaucrats may be to win plaudits for grandiose monuments rather than projects that make economic sense.

It’s not clear whether the author is familiar with public choice theory, but he grasps the basic concepts. For example, he writes:

“Debts incurred today won’t come due while they [planners] are still in office. So why not borrow? Why not pursue grand construction schemes? The more HSR projects a region has under way, the more funding it attracts from multiple sources, and the greater the rewards for local leaders. Over time, this has given rise to an addiction to large-scale construction.”

There are lessons here regarding proposed U.S. high-speed rail projects, as well as for infrastructure plans that fail to analyze supply and demand or fail to insist on rigorous benefit/cost analysis. Thanks to Prof. Lu Dadao for this provocative new study.

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Ideas Proliferate for 2026 Surface Transportation Reauthorization

Transportation groups have been sending open letters to Congress on their ideas for the upcoming reauthorization bill, which needs to be passed by Sept. 30 of next year. I like some of their ideas and dislike others, so for what it’s worth, here is a brief overview. Marc Scribner reviews Reason Foundation’s proposals in the following article in this newsletter.

To me, the most disturbing proposal is that Congress, at a minimum, should provide a transportation funding level that matches what was provided in the Infrastructure Investment and Jobs Act (IIJA) legislation, a large fraction of which was borrowed from future generations (i.e., increasing the federal budget deficit each year and hence the national debt). This is highly irresponsible, given the downgrading of federal bonds by the big three rating agencies and the looming 2033 insolvency of both Social Security and Medicare. All or nearly all of a 29-member coalition of business and transportation infrastructure organizations have nevertheless supported this as the minimum funding level.

On the other hand, that same coalition does call for “fixing” the Highway Trust Fund, which would mean increasing federal fuel taxes by a whopping percentage and adding a corresponding federal highway user fee for electric and hybrid vehicles. (But unlike a recent suggestion from the House Transportation & Infrastructure Committee, the rate per mile for electric vehicles should be comparable to the rate per mile for petroleum-fueled vehicles.)

Several groups advocate further federal efforts toward working out a future propulsion-neutral road user charge/mileage-based user fee (RUC/MBUF) for all roadways, which also makes sense, but we aren’t close to getting there, because the cost of collection (using current technology) would be 10 times what it costs to collect fuel taxes.

There is also broad support for further infrastructure permitting reform, despite recent progress via a Supreme Court decision and reforms to the White House Council on Environmental Quality. The remaining major reform, as I wrote last month, is to reduce or eliminate environmental litigation that takes place after completion of detailed environmental studies.

If Congress were to take seriously the impending fiscal insolvency of the federal government, it would start to narrow the scope of the federal program. One idea, suggested to me by Argentine colleague Eduardo Plasencia last year, would be to rescind the 44% expansion of what is now called the Enhanced National Highway System, which, in the MAP-21 reauthorization, added 70,000 miles of mostly suburban and urban roads to what had been an NHS made up of highways linking cities. Undoing that would remove federal regulations and federal funding from those added roadways. Remember that the original national system consisted solely of the Interstates, which were the only new highways that were 90% funded by the federal government. The states own all important roadways, and they should resume stewardship of those non-highway components. Another potentially doable reform would be to eliminate all discretionary grants, in a bipartisan recognition that these amount to “executive branch earmarks.”

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Reason Foundation’s Reauthorization Proposals
By Marc Scribner

Last year, Reason Foundation’s transportation policy team began developing recommendations for the federal surface transportation reauthorization due by the end of Sept. 2026. Earlier this year, we submitted our recommendations to congressional committees of jurisdiction for their consideration. In July, the U.S. Department of Transportation (DOT) issued a request for information asking what it should include in its reauthorization proposal to Congress. Reason Foundation responded to DOT’s request, making our recommendations public. Below are summaries of Reason Foundation’s nine reauthorization recommendations, in which topic headers link to our full explanations. Each recommendation includes suggested legislative text or reform principles.

A Fiscally Responsible Surface Transportation Reauthorization Bill: Programs under recent surface transportation reauthorizations have become increasingly fiscally irresponsible. The expansion of discretionary grant programs, especially under the current Infrastructure Investment and Jobs Act of 2021, has created a vast catalogue of executive branch earmarks that are poorly targeted and managed. Further, Congress has been bailing out the Highway Trust Fund with general tax revenue, degrading the users-pay principle that underpins the trust fund. Rising public debt and a looming social entitlement program crisis underscore the urgency of surface transportation fiscal stabilization. Restoring fiscal responsibility to federal surface transportation programs will require eliminating—or at least minimizing—discretionary grant programs, aligning Highway Trust Fund outlays with expected user-tax receipts, and increasing the flexibility of states to finance their own infrastructure improvements.

Give States a New Option for Converting from Per-Gallon Taxes to Per-Mile Charges: States generally understand the need to shift from per-gallon fuel taxes to propulsion-neutral mileage charges, but progress toward that goal has been very slow for both technical and political reasons. One alternative to jump-start this needed transition is to allow mileage charges on the limited-access Interstate highways, from on-ramp to off-ramp. This would be relatively simple to implement and would address privacy concerns by forgoing the collection of trip-specific data. To enable this change, Congress could modify the existing Interstate System Reconstruction and Rehabilitation Pilot Program to allow any state to toll any of its Interstates. To address “double taxation” concerns, the program should require states to provide fuel-tax rebates to motorists and truckers for all miles traveled on the converted Interstates. Read Reason Foundation’s recommended legislative text here.

Expanding Private Activity Bonds for Major Transportation Projects: Tax-exempt private activity bonds (PABs) for surface transportation were first authorized by Congress in 2005 and have become an important financing component in infrastructure megaproject public-private partnerships (P3s). Prior to their authorization, P3s in transportation projects were rare in the United States, despite the large fiscal and delivery benefits. These PABs were meant to level the playing field between conventional procurement that has long had access to tax-exempt government bonds and P3s, and have proven highly successful. The original PABs legislation included a cap of $15 billion in lifetime bond issuance, which was doubled to $30 billion in the Infrastructure Investment and Jobs Act of 2021. But there are at least $31 billion in P3 construction costs expected to reach the financing stage over the next several years, and as of August 15, 2025, the Build America Bureau estimated that the remaining PABs capacity was only $1.1 billion. To remedy this problem, Congress should eliminate the PABs lifetime volume cap and expand eligibility to seaports and airports. This would bring better financing parity to P3s and traditionally procured projects and deliver better value to taxpayers. Read Reason Foundation’s recommended legislative text here.

Reforming the TIFIA Loan Program: The Transportation Infrastructure Finance and Innovation Act (TIFIA) program was created by Congress in 1998 for the purpose of addressing capital market gaps for promising surface transportation infrastructure projects. As of 2022, TIFIA loans had helped to finance 98 projects in 22 states. Originally, TIFIA loans were limited to 33% of the project budget and required two investment-grade ratings. These limitations led to the program’s very low loss rate. In recent years, TIFIA’s eligibility criteria have been weakened: projects can now receive loans up to 49% of budgeted costs and only one investment-grade rating is required. The scope of eligible projects has expanded to transit-oriented development, INFRA grant projects, state infrastructure banks, airports, seaports, and natural habitats affected by infrastructure. There is a very real risk of at least the perception of TIFIA being transformed into a traditional discretionary grant program, with the associated reduced accountability. To minimize both financial and political risk to TIFIA, Congress should restore the original requirements on loan size, loan terms, investment-grade ratings, and project eligibility. Read Reason Foundation’s recommended legislative text here.

Discretionary Grant Programs Need to Be Reformed: Under IIJA, discretionary grant funding ballooned to $200 billion that was spread over dozens of different programs, accounting for approximately one-fifth of total transportation funding. Several new programs were established to directly aid local governments, which had little or no experience with federal grant programs. This unprecedented environment led to severe delays, poor documentation, and questionable award decisions. A growing consensus recognizes that the Department of Transportation’s discretionary grant programs lack focus, have been overly political, and cannot be executed in a timely manner. To address these challenges, Congress should reduce the number of discretionary grant programs to one per mode, focus on core national transportation priorities, establish quantitative project scoring criteria, and mandate increased quantity and quality of documentation explaining the award process.

Prioritizing Maintenance in Federal Transit Programs: In recent decades, approximately 20% of funding in each surface transportation reauthorization has been allocated to public transit. For large transit systems, federal grants are generally limited to capital improvements, with the federal government typically paying 80% for eligible projects and the local sponsor providing a 20% match. Transit systems are in poor shape throughout the United States in part because federal grant programs do not sufficiently encourage maintenance before expansion. With nationwide transit ridership down one-fifth since the pandemic and growing fiscal challenges, Congress should prioritize maintenance over capital expansion projects. Specifically, the federal share for New Starts, Small Starts, and Core Capacity grants should be capped at 50%, while the maximum federal share for State of Good Repair grants should remain at 80%. Read Reason Foundation’s recommended legislative text here.

Improving Public Transit Efficiency: With nationwide public transit ridership remaining depressed at roughly 80% of pre-pandemic levels, transit agencies are facing growing financial problems. However, while transit productivity collapsed following the onset of the COVID-19 pandemic, it had been steadily declining for decades. Operating expenditures make up two-thirds of transit agency costs, with labor accounting for a majority of operating costs. A central problem is a 1964 labor law known as Section 13(c), which establishes strict labor protections for transit agency employees as a requirement to be eligible for federal funding. Because Section 13(c) supplements other government employee labor laws, transit agency employees are arguably the most protected class of U.S. workers. This law has inhibited modernization of transit operating practices for 60 years, preventing the adoption of competitive contracting and automation that are increasingly mainstream outside the United States. Adopting these practices and technologies could reduce transit operating costs by one-third to one-half, and thereby pull agencies back from their approaching fiscal cliffs. Congress should repeal Section 13(c) in its entirety, which is presently codified at Section 5333(b) of Title 49, United States Code.

Clearing a Bureaucratic Roadblock to Safer Driverless Trucking: Autonomous commercial motor vehicles have great potential to improve roadway safety and logistics efficiency. Developers have been successfully validating their technology on U.S. public roads for years and have recently launched limited commercial service. However, expansion throughout the United States faces regulatory challenges. In particular, a requirement that drivers of commercial motor vehicles must place warning triangles or flares around their vehicles that are stopped or disabled along highways presents a unique barrier to driverless trucking that Congress can quickly address. In lieu of placing warning devices, a number of companies have proposed alternative means of compliance through truck-mounted warning beacons that likely achieve a greater level of safety than the status quo. Congress should instruct the Federal Motor Carrier Safety Administration to allow truck-mounted warning beacons as an alternative means of complying with the general warning-device rule. Read Reason Foundation’s recommended legislative text here.

Advancing Performance-Based Rail Safety Regulation: New automation technologies are increasingly reshaping transportation systems in a variety of ways for the benefit of safety and efficiency. In the case of freight rail, the ability to adopt new technologies in the face of increasingly automated trucking is also a competitive imperative. Yet many of the rules governing the freight rail industry are decades-old and highly prescriptive, often referencing outdated technical standards. One example is automated track inspection, which has faced an uncertain path due to inflexible regulations and interest-group politics. Another is a century-old statute requiring automatic couplers on railcars, which pose a barrier to entry of a new automated rail technology tailor-made to compete with short- and medium-haul trucking. To reorient federal rail safety regulations toward the future, Congress should require the Federal Railroad Administration to consider performance-based regulatory alternatives whenever proposing or adopting a rule, streamline the waiver petition process, and conduct periodic comprehensive reviews of rules, orders, and guidance documents to assess their effectiveness, consistency, and whether they reflect the current best technologies and practices.

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A Cost-Effective Fix for Amtrak’s Northeast Corridor

Over the past decade or two, there have been many grandiose proposals for high-speed rail in the Northeast Corridor: Boston-New York-Washington. Most have had enormous estimated costs, and the expectation of mostly federal funding, so none of them have come anywhere close to being built. A new approach proposed by the Marron Institute at New York University might turn out to be the exception.

To begin with, let’s ignore the ridiculous super-high-speed rail fantasies and focus on more recent proposals. In July 2021, Jeff Davis of the Eno Center for Transportation wrote about a proposal from the Northeast Corridor Commission: a 15-year plan estimated to cost $117 billion. It was presented as saving 26 minutes for an Acela trip from DC to New York and saving 28 minutes between New York and Boston. The plan itemized a long list of station and track improvements. Davis pointed out that only two months before, Amtrak CEO William Flynn told the House Transportation & Infrastructure Committee that it had a $50 billion plan whose trips would be slightly faster than the Commission’s proposal, at less than half the cost. I’ve never seen that disparity resolved—and neither proposal is being implemented.

But a project team at NYU’s Marron Institute recently released a new Northeast Corridor plan that would cost only $17 billion and lead to even faster trips: just under two hours for either of the two main legs of the Corridor. The key to the Marron proposal is its radically different approach to what needs to be changed. As Alon Levy explained in a Wall Street Journal interview, their approach was to learn from what have become standard practices in Europe, especially Switzerland, but which have never been applied to very conservative, tradition-bound U.S. railroading.

One of these is to make modest improvements in tracks and switching to save time in small increments that really add up. Another is to standardize schedules and run them all day, with the trade-off being that some small station stops would be eliminated so that all trains served all the same stops. Yet another change would be modest speed increases at certain points on the route—on sharper curves, approaching stations, etc.—which are standard in Europe and legal in the United States, but are not used due to traditional super-cautious practices. To be sure, some commuter trains would still operate at slower speeds than Acela, so some of the improvements would be strategically located passing sidings.

Another factor in the faster trips would come about because the set of changes would enable much of the “padding” built into current schedules to be eliminated (again, as in Europe). Still another factor would be changing all the locomotives to electric power. Electric trains accelerate faster and brake faster, which enables local trains to be able to operate closer to express trains, reducing the need to add passing tracks.
 
Levy told the WSJ that they have done detailed simulations to test how these features would work together. I don’t know to what extent their proposal has undergone peer review, but if this has not yet been done, it would be important that some of the reviewers be very familiar with European (especially Swiss) passenger railroads.

As I was writing this article, another Wall Street Journal article reported that Amtrak’s new-model Acela trains are actually slightly slower, Boston-New York City and NYC-DC, than the regular Acelas—again, due to obsolete infrastructure and operating practices.

I was impressed last year with the Marron Institute’s large Transit Costs Project that sought to identify reasons why new rail transit projects generally cost far more in the United States than in many European countries. One of their transportation experts served as a peer reviewer on one of my 2024 policy studies. I hope their new Northeast Corridor study gets serious attention.

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The P3 Option for Deficient Bridges
By Baruch Feigenbaum

Building and maintaining safe bridges is one of a department of transportation’s core tasks. Structurally deficient bridges are both a roadway quality measure (similar to pavement condition) and a safety measure (similar to fatality rate). Each year, Reason Foundation’s Annual Highway Report evaluates states in 13 categories, including bridge quality. Given the report’s expected release later this year, it’s worth assessing not just where bridge condition is today but how much it has improved over the last handful of years.

Some states excel in bridge quality, others struggle, and most are in the middle. The good news for states that are struggling is that there is a proven alternative delivery method that can improve bridge quality on a widespread scale.

In 2023, five states, led by Arizona, had fewer than two percent of their bridges classified as structurally deficient. Yet nine states, with West Virginia being the worst, had more than 10% of their bridges as structurally deficient. The good news is that unlike the fatality rate, which has been uneven, and spending, which has increased even adjusting for inflation, bridge condition has continued to improve. Back in 2017, only two states had fewer than two percent of their bridges as structurally deficient, while 17 states had more than 10% of their bridges as deficient. In 2017, the worst state, Rhode Island, had more than 23% of its bridges in poor condition. By 2023, the worst state, West Virginia, had fewer than 20% of its bridges in poor condition.

The average is also improving. In 2017, the mean state had about 8.5% poor condition bridges. By 2023, the average had declined to 6.2%.

While DOTs are often criticized for being slow bureaucracies, the data show that they have clearly prioritized improving bridge conditions. Many anti-highway advocates claim DOTs aren’t focused on maintenance or safety. According to their narrative, DOTs just want to build more infrastructure regardless of safety. But those advocates are very wrong.

There is no clear geographic rationale as to why some states are excelling and others are struggling. While some metrics, such as fatality rate, tend to favor denser, more urbanized states, and others, such as spending, tend to favor more rural states, bridges are different. In 2023, the top 10 states with the best bridges were sunbelt states with newer infrastructure, led by Arizona and Nevada. But Delaware and Vermont, two Northeastern states with old infrastructure and little population growth, also ranked highly. The bottom 10 states were even more of a mix. Five were Rust Belt states: Illinois, Maine, Michigan, Pennsylvania, and Rhode Island. Three others were Great Plains states with somewhat newer infrastructure: Iowa, North Dakota, and South Dakota. And two stood alone: Louisiana and West Virginia. Clearly, management and priorities are the major factors in bridge condition.

There are several steps states can take to improve their bridges. One is to develop an asset management plan to better manage conditions over the lifecycle of the infrastructure. Another is to take part in peer exchanges. A struggling Northeastern state, such as Maine, could benefit from speaking with a fellow Northeastern Association of State Transportation Officials member, Vermont, that is excelling. States can also make better use of technology; many states use drones or robots, finding that technology has a better view of the bridge carriage or can more easily access parts of the bridge. Finally, states can dedicate funding to bridge improvements. There are many competing priorities for limited funding, but maintenance should be a higher priority than expansion, and roadways should be a higher priority than bicycle paths.

However, states with more than 10% of their bridges that are structurally deficient need to take more drastic action. Pennsylvania shows how an availability payment P3 can help provide financing and transfer risk for bridge improvements. The $1.12 billion Pennsylvania Rapid Bridge Replacement Project P3 replaced 558 structurally deficient bridges throughout the Commonwealth. The bridges were bundled in a single contract, accelerating construction. Under the design-build-finance-maintain model, Plenary-Walsh-Keystone partners is responsible for maintaining each of the bridges for 25 years after reconstruction concludes.

When Pennsylvania undertook the project it had the worst bridge conditions in the country. More than 25% of its bridges were structurally deficient, and the state did not have the resources to make the needed improvements. Without the P3, some bridges would have had weight limits, and others would have been closed entirely. Through the Rapid Bridge P3, the state was able to transfer risk, use a more business-like approach, and tap the private market to finance improvements. Today, Pennsylvania ranks 45th in bridge condition. This might not seem like a great ranking (although it’s better than the state’s 50th place ranking 10 years ago), but the state has reduced its percentage of deficient bridges by half in 10 years. Recently, the state closed on the Major Bridges P3 project, a similar approach for six Interstate highway projects throughout the state. Too few states have chosen this approach to rebuilding their bridges. All states with more than 10% of their bridges as structurally deficient should be examining the P3 option.

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Where’s the Outcry Over Immigration Raids on Construction?

An editorial in the Aug. 11 issue of Engineering News-Record was titled, “What to Do About Our Workers Under Siege.” The piece begins:

“U.S. Treasury Secretary Scott Bessent described President Trump’s trade policy approach as an exercise in ‘strategic uncertainty.’ Regarding the administration’s stepped-up undocumented worker raids, however, we remain unconvinced there is anything strategic about it. Instead, we see confusion, disruption and economic harm Rather than focusing on ‘the worst of the worst,’ as promised during his campaign, the administration has increasingly treated the construction sector as a primary enforcement target.”

The editorial went on to note that undocumented immigrants have long made up at least 12-15% of the U.S. construction workforce, accounting for $30 billion in annual payroll taxes, without those workers receiving benefits.

An article in the same issue of ENR noted that Hispanic workers have long been a key demographic in construction, making up 33.8% of this workforce in 2023 and likely to exceed 35% this year. The article described ICE raids on construction sites in Alabama, Florida, Louisiana, Texas, and elsewhere. The Associated Press and many other outlets have widely reported raids on places such as Home Depot parking lots, where would-be construction workers congregate early in the morning.

The White House says it has offered relief from the immigration raids to the agriculture industry, where fruit and vegetables are often harvested by seasonal workers, typically immigrants. However, Politico reports “the White House does not appear close to a policy decision — and farmers are getting frustrated with the delays.” The agriculture industry still holds out hope because, as Politico puts it, “In Trump’s first term, the White House paid out $28 billion in financial relief for farmers hurt by his trade policies” and because he has expressed some understanding of the large role played by often-undocumented immigrants in the hotel industry, which he knows extremely well. Like fruit-picking and the manual labor portion of construction, these tend to be jobs that most American citizens don’t seek.

ENR’s editorial urged construction trade organizations to “make a full-throated call for a temporary visa system, grounded in labor demand and compliance oversight.” These construction and transportation organizations also need to make the case for the need for these workers and infrastructure projects to the media and the public. Transportation construction costs, in particular, have increased dramatically over the past decade, and an ongoing labor shortage will likely lead to further delays and even higher costs.

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News Notes

Kansas Introducing Its First Express Toll Lane Project
Though it’s only six miles long, the new express lanes being added to U.S. 69 in Overland Park, KS are the first in the Midwest. To accommodate the new lanes, the four-lane highway has been expanded to six lanes, with the new express lanes separated from the general-purpose lanes by a double-white-line buffer area. During the last week of August, electronic tolling equipment was being installed in the northbound express lane, and a period of testing will follow. The lanes are expected to open to paying traffic in January.

Tennessee Identifies Shortlisted Teams for Nashville Express Lanes
On Aug. 20, Infralogic reported that four qualified teams have been short-listed for the I-24 express toll lanes design-build-finance-operate-maintain P3 project. The four teams are headed by ACS/Meridiam/Acciona, ASTM North America/FCC, Plenary/Shikun &Binui/Sacyr, and Transurban/Cintra. This project will be the first of four planned express toll lanes projects in the state.

Iceland Will Be First with RUC for All Vehicles
A transportation expert I’ve known for many years informed me (after reading the August issue of this newsletter) that the first country to implement a road user charge (RUC) for all vehicles will not be New Zealand (which plans to accomplish this within the next several years) but Iceland. As of Jan. 2026, all 315,862 registered motor vehicles (including trucks) will pay an annual fee based on the number of kilometers driven. It’s not clear if the 12,482 semi-trucks will pay a higher rate. Motorists will be able to make online payments during the year, rather than having to pay the annual total at year-end.

Record Pipeline of Transportation Projects vs. Dwindling Private Activity Bonds
The good news released by DOT’s Build America Bureau in late August is that the pipeline of approved P3 highway projects is at an all-time high, with most of them being express toll lane projects in Georgia, North Carolina, Tennessee, and Virginia. The bad news is that the remaining capacity of the current $30 billion Private Activity Bonds (PABs) program is now down to just $1.1 billion. Fortunately, Congress can fix this in the upcoming 2026 surface transportation reauthorization bill. Reason Foundation is arguing that the current $30 billion cap is obsolete, because the PABs program is no longer an experiment. Removing the cap would mainstream PABs; there is no federal cap on tax-exempt municipal bonds.

Georgia Removes Some I-85 Toll Exemptions in Atlanta
After Sept. 30, some vehicles that used to be exempt from the variable pricing on the I-85 express toll lanes will pay tolls. Henceforth, electric and alternative-fuel vehicles will have to pay the posted toll rate on all single-occupant trips. Carpools will still be exempt. In recent years, about 20% of all vehicles using the express lanes were toll-exempt.

Florida DOT Expands Tampa-Area Express Lanes
In a recently begun project, FDOT has launched a $340 million project to add two express toll lanes each way to 7.5 miles of I-275 in Pinellas County. To accommodate the new lanes, the project is also reconstructing four interchanges and modifying four bridges.

NEVI Reforms Should Speed Up EV Charging Station Implementation
U.S. DOT last month announced reforms to the troubled National Electric Vehicle Infrastructure (NEVI) program. The headline on most news stories focused on the removal of the requirement for state DOTs to add a charging station every 50 miles on their selected highways, but the reforms cover more than that. Gone are former requirements for labor union participation, small-business mandates, and required participation by businesses owned by minorities and women, many of which might be difficult to accomplish in rural states and/or may increase project costs.

Truck Producers Sue California Over ZEV Sales
A group of truck manufacturers has filed suit against the California Air Resources Board (CARB), arguing that since Congress overturned the regulation that led to the state’s “Clean Truck Partnership,” the state’s program is illegal. When the federal regulation was in place, the companies agreed to meet certain zero-emission requirements. After Congress overturned the regulation, the U.S. Justice Department sent CARB a “cease and desist” letter calling for it to drop its effort to continue the program despite Congress’s action.

Life Insurer Invests in U.K. M6 Toll Road
Life insurance company Just Group last month made a £20 million loan to the M6 toll road public-private partnership, owned by IFM Investors, which invests in infrastructure on behalf of public pension funds. The toll road company, Midland Motorways Group, received a 22-year refinancing loan to support upgrades, including a modernized electronic tolling system. The 27-mile, six-lane toll road in the West Midlands is the only such toll road in the U.K. Just Group deploys pension fund capital into revenue-generating infrastructure.

Delaware River Bridge Implements Protective “Dolphins”
ENR reported that the twin-span Delaware Memorial Bridge is installing “dolphins” to protect the bridge piers from collision damage from large ships. The two-year, $93 million project is adding eight stone-filled concrete 80-ft. diameter cylinders near the piers, with completion expected this fall. The project is under the auspices of the Delaware River and Bay Authority.

Cube Highways Buying India Toll Road
Indian firm Reliance Infrastructure is selling its Pune Satara Toll Road concession to Cube Highways and Infrastructure, owned by infrastructure investment fund I Squared Capital. In 2020, Reliance sold its Delhi-Agra Toll Road to Cube Highways. Both projects were developed under India’s Build-Operate-Transfer toll model.

Philip Howard’s Answer to Infrastructure Obstacles
In a policy paper for the Manhattan Institute, long-time government reform advocate Philip K. Howard sets forth a three-part agenda in “Escape from Quicksand: A New Framework or Modernizing America.” The first proposal would create a new framework for infrastructure projects, designating a lead agency with final authority to approve major infrastructure projects, constraining today’s extensive judicial review. Second, a National Infrastructure Board would approve projects, shielding elected officials from political backlash. Third, a nonpartisan Recodification Commission would work out the details of these reforms. I’m not sure this is the best approach. But I’m glad to see qualified people proposing solutions to the roadblocks that delay or kill much-needed infrastructure improvements.

Driverless Trucks on Highways at Night
In another step toward autonomous long-haul trucking, Aurora Innovation has been operating autonomous trucks at night between Dallas and Houston. Aurora says its new LIDAR system can spot obstacles 300 yards ahead and react 11 seconds sooner than a human driver. Competitor Kodiak is operating trucks between Atlanta and Dallas and between Houston and Oklahoma City. Long-haul trucking is the most difficult sector for retaining drivers. Moreover, a truck that does not have “hours of service” driver regulations should be able to operate far more hours per day, increasing productivity as well as saving on operating costs.

Ship Pilots Testing Remote Guidance
The Wall Street Journal reported that maritime pilots in Denmark are testing a new form of remote work. “Remote pilotage” is an emerging technology that enables an experienced pilot to guide a ship into and out of port from a console on shore (or in the case described, on a houseboat). The article reports that the technology from a firm called Danelec is the first to enable remote pilotage, using data transmitted from the ship being piloted. The International Longshoremen’s Association is coordinating the first GlobalAnti-Automation Conference in November, in Portugal. DanPilot, developer of the technology, says there are enough use cases to gain interest from pilots in Australia, Singapore, Finland, and Sweden thus far.

GDOT’s Russell McMurry Wins Award
The Commissioner of Georgia DOT, Russell McMurry, last month received the Lifetime Achievement Award from ITS America. This honor is awarded annually to a transportation professional who is recognized as a thought leader in intelligent transportation systems. McMurry has led GDOT since 2015 and is a long-time champion of transportation system management and operations (TSMO) and connected vehicles to everything (CV2X).

National Intercity Bus Atlas Published
A project managed by the Transportation Research Board (TRB) has released a booklet, “Implementation of the National Intercity Bus Atlas.” It summarizes the National Cooperative Highway Research Project that developed three guides: a user guide for intercity bus carriers and related companies, a user guide for transportation agencies, and a guide for maintaining and improving the intercity bus atlas.

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Quotable Quotes

“While this [IIJA] deficit spending allowed us to continue making important investment in infrastructure, it is fundamentally unsustainable. State and local governments, engineering and construction firms, and their workers understand that they cannot continue to rely on general fund revenue in order to make the robust investments in our infrastructure that are needed. We therefore need to find a new way to pay for these investments.”
—John Drake, VP, Transportation Infrastructure, U.S. Chamber of Commerce, letter to Hon. Sam Graves and Hon. Rick Larsen, April 30, 2025

“In favor of a merger, interchange between railroads at Chicago, Kansas City, and a few other sites is the bottleneck of all bottlenecks. A container might spend three days getting from Los Angeles to Chicago and another three days getting across a Chicago rail yard. The division of the country into east and west rail sectors can also be a problem for certain midwestern shippers, since their nearest carrier may have little interest in the short-haul portion of a longer trip that financially benefits a rival railroad.”
—Holman W. Jenkins, Jr., “Mergers Test ‘Madman’ Trump,” The Wall Street Journal, July 30, 2025

“Underpinning the concept of market-driven city planning is an acceptance that spontaneous order emerges without design. Labor markets create cities, ensuring that, even as millions of people make unpredictable decisions, equilibrium is maintained. Price signals lead to more housing where it’s needed, and at no point are millions of workers left without a home. . . . The location of jobs is decided by the market. In order to respond as efficiently as possible to maintain this spontaneous order, the location of housing should be, too. Urban planning has a place, but it’s in responding to what infrastructure people say they need—not breaking ground where planners think housing ‘should’ be built. In short, planners should respond to the labor market and not try to shape it themselves.”
—Alain Bertaud, “How to Build a City,” NYU Marron Institute of Urban Management, July 15, 2025. Bertaud is the author of Order Without Design, MIT Press, 2018

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