Private Roads, Public Costs

A growing number of states are considering arrangements in which a private operator provides an up-front payoff or builds a new road in return for decades of escalating toll receipts. The report assesses these deals and identifies a number of problems, including: 

· Private toll roads typically require greater toll hikes to generate the same upfront payment that could be generated without privation.

· Private deals lead to serious loss of public control that hinders future transportation planning and typically force public payments to compensate private companies if policies reduce toll traffic.

· Deals are often conducted with inadequate public disclosure or input.

· States generally lack the capacity to oversee or enforce private road agreements

· Problems are compounded by the fact that contracts typically extend 50-plus years in order to obtain large federal tax subsidies.

The study examines 15 completed private road projects and 79 others that are proposed or underway.

The report, which provides numerous public opinion survey results on private roads, also provides six basic principles for protecting the public from bad road privatization deals.

Report | Georgia PIRG Education Fund | Safe Energy

The High Cost of Nuclear Power

Nuclear power is among the most costly approaches to solving America’s energy problems. Per dollar of investment, clean energy solutions – such as energy efficiency and renewable resources – deliver far more energy than nuclear power. This fact has important implications for America’s energy policy. By directing resources toward the most cost-effective solutions, we can make greater progress toward a secure, reliable and safe supply of electricity to power America’s economy. 

Report | Georgia PIRG Education Fund | Budget

Failed Bailout

Following the collapse of major financial institutions Congress enacted a sweeping $700 billion taxpayer-financed bailout of the financial sector. However, months into the program and billions of dollars later, no one knows how the money was spent and no one is convinced that it’s achieved any of the intended results. The U.S Public Interest Research Group Education Fund (U.S. PIRG) believes it is critical for Congress to demand and the Department of Treasury to implement mechanisms and metrics to make sure that the actions of the TARP recipients reflect the original goals and objectives of the Emergency Economic Stabilization Act (EESA). Those mechanisms must be based on the sound public policy principles of oversight and accountability.

The report first establishes that what is known about how the TARP recipients’ behavior before, during and after the bailout paints a dire picture of how the TARP funds were spent. It then presents a clear opportunity for lawmakers to regain some of the withering faith of the American people through widely supported execution tactics and simple communication practices with respect to TARP.

Report | Georgia PIRG Education Fund | Health Care

Health Care in Crisis

Unless the new Congress and Administration act to reduce health care costs, the yearly cost of the average employer-paid family health policy in Georgia is projected to more than double from $10,793 in 2006 to $22,796 by 2016 even after adjusting for inflation. If recent trends continue, wages and household incomes will simply not keep up with these high costs. Nor will the business sector be immune to this crisis.  Unchecked, this cost epidemic could also severely impact the small businesses that drive job creation in the Georgia’s economy.

Unfortunately, too much of these astronomic costs are going to enrich special interests, not buy the best health care.  The Congressional Budget Office estimates that nationally as much as one third of health care spending is wasted and does not improve outcomes. That means that, in 2007, one out of every three dollars that Americans spent on health care, or $730 billion, went to the insurance bureaucracies, drug companies, medical device manufacturers, and providers without improving a single person’s health.  In Georgia, one third of health spending amounts to $13.7 billion.

This report examines three important sources of this unproductive spending.  We conclude with a package of urgently needed reforms which target those causes, improve quality of care, and rein in this unnecessary spending.  As part of comprehensive health reform, these policies will enable America to emerge from this crisis with a health system that consumers and businesses can afford and families can depend on.

Report | Georgia PIRG Education Fund | Transportation

Economic Stimulus or Simply More Misguided Spending?

President-elect Obama has declared that the next recovery plan must do more than just
pump money into the economy. It will also create the infrastructure that America needs
for the 21st century.

This fall, Congress asked states to submit lists of “ready-to-go” transportation
infrastructure projects that could be funded by the stimulus package. Lists from nineteen state departments of transportation (DOTs) show that the broader goals articulated by President-elect Obama will be undermined if Congress, the Administration, and the states do not establish forward-looking rules for spending stimulus funds.

Only about one-third of state DOTs have released to the public the project lists they
submitted to Congress. However, a majority of the nineteen that have come to light are
badly out of touch with the current trends, public priorities and transportation system
needs that underpin the President-elect’s declaration. Most stimulus project lists from
state DOTs prioritize new highways while paying relatively little attention to repairing
crumbling bridges and roads and even less emphasis on forward-looking transportation
options, such as public transit and intercity rail. As a result, they are contrary to
President-elect Obama’s stated intention to use smart spending to reduce America’s
dependence on oil and emissions of global warming pollution.

On average, the nineteen states would spend more than 75 percent of funds on
highways and only 17 percent on public transit or intercity rail. In fact, seven states
would allocate 1 percent or less, including four that would allocate nothing at all. This
would be a step backward from even the grossly inadequate 20 percent share received
by transit in federal transportation laws since the 1970s. It runs counter to Americans’
stated preferences, declining automobile use, and rapidly increasing transit ridership.
Of the fourteen state lists for which adequate data on types of proposed highway
spending were available, states on average would divert the majority of highway funds
for new and expanded roads rather than addressing their backlog of repair and
maintenance projects. More than a third of states would use less than a quarter of road
funds on backlogged repair or maintenance.

To prevent a misspending of recovery funds, Congress the next Administration and state
leaders should apply six principles:

(1) Any road funds should go first to maintenance and repair of structurally deficient
bridges and roads, not new highways or lanes;
(2) The combined total for public transit, intercity rail, and bicycle and pedestrian
projects should be no less than funds for highways;
(3) Public transportation funds should include support for operations so agencies
can accommodate the rising demand.
(4) Surface Transportation Program highway funds should be distributed as under
current law so that a portion of resources flow directly to metropolitan areas that
know best about which local projects are needed;
(5) All states, cities, and agencies should publicly disclose the stimulus lists they
have submitted;
(6) Direct recipients of stimulus funds should report on how money was spent and
any transportation spending that it displaced.
The economic recovery package will present an opportunity to advance widely
recognized, new transportation priorities for the 21st century. It will be up to Congress,
the Obama Administration, and the states to make sure that happens. So far, however,
too many of the states are off to a troubling start.


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