Report: Spend more on transit to create more jobs
State trying to maximize stimulus dollars for roads, transit
When the first of $27.5 billion in federal stimulus aid for highway projects became available in March, state and national officials ballyhooed a one-mile resurfacing of New Hampshire Avenue in White Oak as the initial project in the United States to benefit.
However, a report last week on stimulus spending said the federal money would be better spent on transit not highway projects, if the goal is to create jobs.
Stimulus spending on public transportation created nearly twice as many jobs as spending on highway projects during the first 10 months of the American Recovery and Reinvestment Act, according to the report by the Center for Neighborhood Technology, Smart Growth America and the U.S. Public Interest Research Group.
Using data provided by the U.S. House of Representatives Transportation and Infrastructure Committee, the analysis found that every $1 billion spent on public transportation created 16,419 job-months, versus 8,781 job-months created by every $1 billion spent on highway infrastructure projects.
The report comes as the U.S. Senate is preparing to consider a $154 billion jobs bill passed by the House last month that seeks to renew many of the programs funded in the original $787 billion stimulus plan.
The bill contains a similar ratio of transit to highway projects, about one to four, said Fielding Huseth, an advocate for Maryland PIRG.
"We'd like to see more of a 50-50 balance," he said.
To date, the State Highway Administration has used stimulus dollars to award 108 contracts worth $266 million. The Maryland Transit Administration has awarded 50 contracts worth $102.7 million.
Under the stimulus package, Maryland received $638 million for transportation. Of that, $414 million is going to eligible highway projects and $152 million is for eligible transit projects. Another $72 million accounted for Maryland's share of funds for the Washington region's Metro system, according to the state Department of Transportation.
Those numbers reflect a transfer of $17.1 million from highway to transit projects after bids came in about $30 million less than expected.
"Contractors were so hungry for the work that there was a substantial savings," said Jack Cahalan, a spokesman for the state Department of Transportation.
In September, Gov. Martin O'Malley (D) announced that the $17.1 million savings would go to rehabilitate the Mondawmin Transit Center in Baltimore, the Maryland Transit Administration's aging bus maintenance facilities and electrical systems on the Baltimore light-rail system. The remaining $13.4 million was set aside for highway safety, resurfacing, drainage and bridge improvements statewide.
Maryland has awarded 65 percent of all ARRA-funded transportation project contracts, placing it among the quickest states to pump stimulus dollars into the economy, according to the Recovery.gov Web site tracking stimulus spending.
The transportation stimulus has impacted 1,086 jobs, according to estimates by the Maryland Department of Business and Economic Development. That includes 590 created directly using ARRA funding, 86 indirectly created to support ARRA-funded projects and 410 induced through greater consumer activity as a result of ARRA-funded projects.
The state's analysis does not estimate jobs created by highway projects compared to transit projects. The interest groups have not analyzed the data by state, Huseth said.
The state's unemployment rate increased one-tenth of 1 percentage point in November to 7.4 percent, while the national rate dipped two-tenths of a percentage point to 10 percent.
Dennis Coates, a professor of economics and public finance at the University of Maryland, Baltimore County, sees the interest groups as using the jobs bill as a means to promote transit more than job growth.
The 5,951 year-round jobs that the report estimates would be created by spending just as much on transit as on roads is a "trivial" number when considered in the context of 138.5 million American workers, Coates said.
If the groups want to advocate for job creation, "do it directly. Don't do it as if this is going to be a big job creator," he said. "Good public policy is made when people know the facts and address issues head-on rather than through the side door or indirectly."
The stimulus spending provided a nexus for PIRG to consider jobs and transit, which are both important priorities for the group, Huseth said.
The report takes into account not only new temporary construction jobs created by the transportation projects, but also long-term job creation. Transit projects create more permanent jobs, such as rail maintenance and train and bus operators, Huseth said.
Studies show that cutting public transportation, such as a bus route, often costs people a way to get to work, he said.
"It's important that we create a transportation system for the 21st century, and public transit is what's going to get us there," Huseth said.