The Hoan Repair: A conservative evaluation

A real conservative starts any discussion about a very expensive proposed public project with a few questions: First, how much will it cost? Second, how will we pay for it?

In trying to answer those questions about the planned refurbishment of the Hoan Bridge, the WisDOT staff have estimated the repairs will cost between $275 million and $350 million.  A fiscally conservative taxpayer would err on the high side, so we will say $350 million.  But wait, is that the total bill?  What about the current $7 million in repairs?  And what about the repairs last year?  And don’t freeways need to be resurfaced ever 10 or 15 years?  How much will all that ongoing maintenance cost?  Let’s estimate answer to the first question is that the total project cost will be $450 million.  To keep things simple, lets assume the bridge lasts for 45 years, which means the Hoan costs the taxpayers $10 million a year.

Now that we know the total cost of the proposed project and the future costs, any custodian of the public trust would let the taxpayers know how the project will be funded.  With freeways, the answer is simple, the federal highway trust fund, or the gas tax.  In theory, every person who drives over that 2.5 mile long bridge pays for that privilege when they fill up at the pump, to the tune of 18.4 cents per gallon thanks to the federal gas tax. Theories are nice, but a conservative always says “show me the money.”

How much do those 40,000 taxpayers driving over the Hoan Bridge every day actually kick into the kitty?  The math on this is pretty simple. We multiply the number of vehicles crossing the bridge per day by the length of bridge.  Then we divide that amount by the average fuel economy of those vehicles; multiply times the federal gas tax per gallon and finally multiply that number by 365 days in a year.  Voila’, we have just calculated the amount of gas taxes the Hoan bridge generates each year and we can determine if we can afford to do the project.

So we have the following:

40,000 * 2.5 miles / 20mpg* .184 * 365 = $335,800

All right, now let’s run this past the general taxpayer expected to shoulder the cost of the project. It is going to cost $10 million per year to pay for the Hoan over the useful life of the bridge, but the bridge only brings in $335,800 a year.  Hmm, it seems we are a bit short here.  Where can we find some more money?  I know, maybe we can use State gas taxes and the sales tax on gasoline too.  Those add up to an additional 37.9 cents per gallon.  Let’s count our pennies now:

40,000*2.5/20*.563*365=$1,027,475

Really, we are still about $9 million a year short? That means that we are about $400 million short of the $500 million the bridge will cost us.  Where can we find some more money?  What about the miles of road that lead up to the bridge on the Lake Parkway (I794)?  Maybe drivers are overpaying there and that will subsidize the bridge.  The Lake Parkway is 4.75 miles long and cost $130 million to build.  Lets add another $30 million for maintenance over the future life of the Parkway.  At grade freeways need to be completely reconstructed every 30 years or so, so the annual cost to taxpayers is about $5.3 million a year.

Now lets see if it is generating some extra cash we can put toward the Hoan project:

40,000*4.75/20*.563*365=$1,952,202.5

Nope, no extra money there, in fact it doesn’t even pay for itself.  This is just a simplified way to look at the concept of asset value indexing for road projects.  The Asset Value Index, was developed to compare the full 40-year life-cycle costs to the revenues attributable to a given road corridor or section. The Texas DOT created a much more rigorous Asset Value Index program and evaluated all the roads in Texas.  They found that there is not one road in Texas that comes even close to paying for itself. They concluded that gas taxes only cover about 32% of the cost of roads and highways.  TxDOT was using the study to argue for increased use of toll roads.

In fact, all roads in Texas, Wisconsin and everywhere else for that matter are subsidized by non-user taxes. According to the Federal Highway Administration, the Highway Trust Fund only covers about 50% of the cost of highways.

Source: Highway Statistics, forms HF-10 and HF-210, Federal Highway Administration

OK, so what is the point of all this depressing talk about underfunded transportation systems?  The point here is that since the Hoan gas taxes won’t come close to paying for the Hoan, it is no more fiscally “liberal” to suggest that we add value to the project by including a bicycle and pedestrian accommodations, like every other landmark bridge in the Country.  Since we can get a huge return on a very small investment, about 1% of the total project cost, it would be fiscally irresponsible not to try to add value to this underfunded, under-utilized highway project.

So say it with me and say it to your elected official: One Percent to Walk and Bike the Hoan!

About daveschlabowske

Cyclechic advocate from Milwaukee
This entry was posted in Advocacy, Bike facilities and tagged , , , , , . Bookmark the permalink.

10 Responses to The Hoan Repair: A conservative evaluation

  1. Lance says:

    Very nicely done. Unfortunately, the typical driver will respond by saying, “I don’t care how much it costs or who is paying.” Addicts don’t do math. (I know it’s not nice to call them addicts, but it’s true and it’s the only explanation for irrational highway spending).

  2. Max says:

    Nothing turns a conservative into a socialist faster than a road project.

  3. Carolyn says:

    Nice- I like how you break it down. I think it’s the first time I’ve seen the math clear (and understandable) on road construction. Drivers will want this on the Hoan bridge if gas prices keep rising (and will). Already- I have coworkers asking me about biking to work because they can’t afford the gas and I’ve reminded them they need to support the bike projects because one day they may use it too.

  4. Barry Stuart says:

    What also adds value is usefulness. The Hoan Bridge is the most efficient route for bicyclists between the East Side and Bay View (and points south). As it is now, there’s no direct route between the north and south lakefront portions of the Oak Leaf Trail from Michigan Ave. to Carferry Dr. I hope to see Milwaukee move past the history of refusal to connect the various neighborhoods to making connections all over.

  5. Bruce Thompson says:

    Nice calculation. The 50% calculated by the feds seem high if other projects share the economics of the Hoan and Lake Parkway. Or do roads outside cities come closer to paying for themselves?

  6. Ralph in da U.P. says:

    Too many numbers so early in the morning for me…reminds me why I skipped geometry in High School…

    But seriously, the numbers even make sense to me! And the path across the Hoan, with its cement walls cradling cyclists in their loving, concrete greatness, is the most direct, and most likely the safest way to downtown from bay View and points south.

    Seriously, I have ridden the “alternate street route” during peak times and even other times and it is rather harrowing to say the least! Rush hour drivers hell bent on using their cell phones, eating their breakfasts, doing their make up and, oh yea, maybe even watch for pedestrians and cyclists as they rocket to work. I even saw one guy trying to read the newspaper as he drove! Twice I had to either jump the curb or bail as I ran the bike into the curb to keep from being flattened! One time was a city bus that passed me and as he almost completed the pass, turned into the curb lane to pick up a passenger. The other was a motorist who though he could save a little time in congested traffic. How was he saving time? By doing about 35mph in the curb lane past all the other slow drivers going bumper to bumper….And I dared to be stupid (Hi Weird Al!) by riding in that curb lane while heading through downtown.

    And it was not much better back in the early 80’s when I rode it frequently!

    So, I say to the powers that be, put the bike path on the under used, under funded bridge! It will not cost much more to put in the bike/walking path, that was supposed to be there in the first place! And maybe, Milwaukee can warp into the 20th century and have the same thing that other landmark bridges, all over the country, already have!

  7. I think the first question a conservative would ask (at least this Rockefeller republican) is: Is it needed?
    I am a bike enthusiast and one of the few I know who takes public transit. I’m not sold on a walk/bike path across the Hoan (I’ve biked it illegally once and legally twice). I question how many would actually bike the height, especially on a windy day. I would prefer funds be used to create a safe/creative method of traversing north to south or south to north via KK and the backroads to the east of KK. Your analysis was very good so thank you for the time, research and writing.

    • daveschlabowske says:

      Needed or wanted? The Hoan is not needed for cars. We already have a street system. It did not connect to anything other than the street system for years. Wanted, or will it be used is another question. To answer that, the pubic opion surveys done as part of the WisDOT funded study, the Hoan Bridge was the overwhelming preferred route. Given there are about 100,000 bicyclists who dead-end their rides in the parks at the ends of the bridge, I think it would be well used. I have spoken to a few other cyclists who prefer the on street route, but only a few. The majority of people I have spoken with support the findings of the study, and prefer the Hoan. AND, the City of Milwaukee is already working on a project to upgrade the streets between the two ends of the Hoan. That project will begin this summer.

  8. Bill Sell says:

    Thanks for the numbers, Dave. Last year the respected budget analyst David Riemer identified the funds that come to the aid of our road building addiction. He reports 41% of the funds come from income, property and sales taxes; 58% from gasoline, fees and licenses related to cars and trucks.

    I graphed his report at: http://www.milwaukeerenaissance.com/BillSell/RoadCostsWhoPays

    Nondrivers pay for roads, too. When we shop, the cost of anything we buy includes the gasoline taxes, fees, licenses of the trucks that haul the goods to our neighborhood. When we pay our property, income and sales taxes, a good hunk of that goes to the Transportation Fund (which we are instructed by the driving addicted not to raid).

    The subsidized ride has given us a generation of entitled drivers who believe they pay for the roads when they pump gas. These more accurate numbers need to find their way into our political dialogue.

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