Originally published by AL.com on September 13, 2017.
President Trump has consistently indicated that infrastructure is one of his top priorities, and wants $1 trillion in new infrastructure spending. Thankfully, the administration is not insisting on using only taxpayer dollars, but is instead open to leveraging the private sector to help fund America’s infrastructure needs. Alabama is showing how this can be done.
In recent years, traffic over the Intracoastal Waterway to Gulf Shores and Orange Beach, on both the public I-59 and the private toll bridge Foley Beach Express, has stretched the limits of existing capacity.
Unfortunately, politicians initially took an antagonistic approach when the company that owns the Express showed interest in investing in a new bridge. Rather than immediately welcome the private investment, city leadership sought to pressure the company to lower tolls on the Foley Beach Express by threatening to “put them out of business” by borrowing $30 million to build another “free” bridge.
Of course, committing tens of millions of taxpayer dollars to a project, not to mention the ongoing government expense of operating and maintaining it, is not really “free.” It just shifts the costs to the public, whether they will ever use the bridge or not. It’s also not a prudent choice for a state experiencing constant budget problems, especially when other options are readily available.
Thankfully, that hasn’t happened. Rather than insisting on a taxpayer-funded take-down of an efficient private asset, elected officials began negotiating to expand the existing privately-owned bridge–a far better approach than threats and antagonism.
As a result, it has recently been announced that the company that owns the Foley Beach Express will add a third, reversible lane to ease congestion, at no cost to taxpayers. In the process, they’ll also be able to lower summer tolls thanks to other advancements improving throughput, like the widening of the toll plaza and greater reliance on electronic tolling that eliminates the need to stop for payment. In other words, everybody wins.
Avoiding unnecessary public spending is not just good politics, it’s also good economics. Tolls are a type of user fee, which means costs fall on those who actually use and benefit from a good, rather than on the entire public. Not only that, but variable tolls help reduce congestion at peak times by discouraging those commuters who can afford to wait until later from traveling during high traffic periods. And, of course, the ability to earn a profitable return on an investment in America’s infrastructure will encourage others to invest as well.
The lesson is that infrastructure problems can often be solved more efficiently through private action, or at least with private sector help. The Trump administration has the right idea in wanting to encourage public-private partnerships, proposing $200 billion in an incentive program for state and local governments that enter into agreements or make private sector deals. Other states should look to Alabama and find ways to incentive companies to meet the nation’s infrastructure needs instead of simply relying on an already overtaxed public.
