Tag Archive for: U.S. transportation infrastructure

Congestion Pricing And The Bridge Industry

Congestion pricing has become a topic of interest, as many commuters are being affected by it. However, this audience also includes the bridge industry. With more bridges aging quickly, repairs and replacement are needed. But with limited financial resources, effective congestion pricing may be the solution for bridge managers, as bridge maintenance costs are often included in the price. However, there are pros and cons to the impact of this practice.

Congestion Pricing 101

Congestion pricing is the charge that people pay for using public assets, such as bridges, tunnels, or other infrastructure. In other words, it is the toll charges that commuters must pay. These charges differ in amounts of money depending on timely demand for use of the asset. For instance, in the case of bridges, the toll charge increases during peak hours. The fundamental concept is that at a cost of zero, public asset usage would increase astronomically. Thus leading to more overcrowding and faster deterioration of the infrastructure.

“If a good or service is provided free of charge, people tend to demand more of it — and use it more wastefully — than they would if they had to pay a price that reflected its cost. Hence, congestion pricing is premised on a basic economic concept: charge a price in order to allocate a scarce resource to its most valuable use, as evidenced by users’ willingness to pay for the resource.”

Testimony from a 2003 United States Congress Joint Economic Committee

What Experts Say

Congestion pricing was created to control demands during times of peak use. Economists say that this pricing strategy is most successful when people understand the costs they pay during peak demand. This higher price forces them to pay for “negative” habits, like overloading bridges during heavy traffic. So, people who truly need to use the public asset, are more willing to pay the higher cost. Whereas, those who have more flexibility, could change the time of their commute or choose a different route. In brief, congestion charges encourage consumers to readjust their demand by location or time.

Alleviating Overcrowding

Many large cities around the world are already adopting the practice of congestion pricing. Also, smaller cities that experience overcrowding are taking advantage of it. To alleviate the overcrowding issue, there are metro areas that are beginning to develop plans to include such charges in the next few years.

Negative Effects of Congestion Pricing

Like everything, there are some negative effects to this practice. Critics claim that congestion pricing is not an equitable practice because it creates more economic and social burdens on certain communities. For instance, people who are dependent on a particular transportation service may find themselves restricted. Further, this practice may pose a decrease of economic activity in certain areas.

Economists say that when implementing this practice, certain issues should be considered:

  • Define the objectives: reduce traffic, lower congestion, generate revenue, etc.
  • Determine the best way to set and collect fares or tolls.
  • Ensure that revenue covers basic expenses while providing enough to pay for improvements and new development.
  • Decide what to do with excess revenue.
  • Prevent negative impact on vulnerable communities and populations.

U.S. Bridge Steel Bridges Stand the Test of Time

These are some of the points that should be considered so that the program can be successful. It is important to recognize that using good congestion pricing strategies can be a good way to control usage and slow down decay. Further, this practice can generate revenue that could be implemented in the repair, replacement, or addition of infrastructure. The good thing is that U.S. Bridge steel bridges stand the test time. Our bridges are engineered and manufactured with longevity at its core. Contact us today or get a quote online and start your project today.

2018 Bridge Industry Economic Projections

Rumors have been circulating that the federal government is ready to pour a lot of funds into U.S. infrastructure. Beyond rumors, though, what is the real economic outlook for our industry? Below are some key Bridge Industry Economic Predictions and what we can expect throughout 2018.

Strong Overall Outlook

With a dropping unemployment rate and low inflation, the overall outlook for construction growth in 2018 is very positive.  General construction work is estimated to grow by five percent. More specifically, signs indicate that the Southern and Western United States will see the biggest impact on growth. While the cost of building materials is likely to rise by a little over two percent, overall industry growth is still expected.

Bridges and Roads

Bridge Industry Economic Projections estimate that bridges and roads will be the biggest growth segment in the nonbuilding sector. This is in part due to the government’s Infrastructure for Rebuilding America (INFRA) program. This program will fund up to 10 highway and bridge projects. However, it has not yet been voted on.

State by State

The overall growth of road and bridge construction may seem minimal when applied to the entire U.S. as a whole. However, some states will see more growth than others. According to the American Road and Transportation Builders Association (ARTBA), California, Florida, New York, Hawaii, Virginia, and Washington are poised to see the most local growth in the construction industry. Additionally, total spending on public bridge and tunnel construction is expected to top out around $31.3 billion, a slight increase over 2017.

Signs for a Strong Future

Most assume that the federal government will pass INFRA, adding funds to the construction industry in 2018 and early 2019. These projects would undoubtedly bring long-term growth for years to come. Further, with nine percent of the U.S.’s bridges and roads deemed structurally deficient and in need of repair, the need for bridge and roadway construction will likely continue for decades.

To find out more about Bridge Industry Economic Projections and what U.S. Bridge is doing to help, please contact us today. At U.S. Bridge, we have designed and manufactured bridges for over 80 years, providing the pathways that keep America moving.