1

1

21st Century

Transportation Committee

NCDOT Overview

Presented by:Mark Foster, CFOCalvin Leggett, PE

November 7, 2007

2

AASHTO’s Call for Action

Our generation inherited the world’s besttransportation system made possible by thecommitment of the last two generations toinvest in the country’s future. We havespent that inheritance.

AASHTO Board of Directors2006

1A

2

3

NCDOT Facts

• Roads 2nd largest state system

• Bridges 2nd largest, 18,540 –377 miles

• Ferries 2nd largest system, 23 ferries

• Rail Passenger & Freight Support, 4,350 crossings

• PublicTransportation

County, Urban & Regional Support

• Aviation General Aviation Support, 63 airports

• Bicycle andPedestrian

3,000 mile state system

• Addition SupportHighway Patrol, Contributions to MunicipalBudgets and General Fund

4

System ResponsibilityState Lane-Miles and Ranking

- 40,000 80,000 120,000 160,000 200,000

Florida

Georgia

South Carolina

Virginia

North Carolina

Texas

US Average

Lane-Miles

13

11

2

4

1

3

3

5Public Road Length - 2003Lane Miles by Ownership Update

State% of Rural Statewide

Ownership% of Urban Statewide

Ownership% of Total Statewide

Ownership

Florida 18.0% 13.8% 15.6%Georgia 19.4% 17.9% 19.0%North Carolina 89.5% 43.8% 78.0%South Carolina 63.4% 69.0% 64.4%Texas 33.6% 19.7% 29.5%Virginia 95.6% 47.0% 80.3%50 State Average 23.2% 18.2% 21.9%

Source: Highway Statistics - US Department of Transportation Federal Highway Administration

6NCDOT Appropriations2007-08

29%Highway Trust Fund 0.1%

Department Receipts

24%Federal Funds

47%Highway Fund

North Carolina Transportation Program Revenues 2006-09

Authorized Authorized Authorized$ in Millions 2006-07 % Change 2007-08 % Change 2008-09 % Change

Highway Fund 1,793.7$ 31.7% $ 1,832.1 2.1% 1,811.0$ -1.2%Highway Trust Fund 1,100.6 10.7% 1,128.3 2.5% 1,138.8 0.9%Federal Funds 890.1 -10.7% 942.7 5.9% 942.7 0.0%Department Receipts/General Fund 5.0 -72.4% 24.3 386.0% 24.3 0.0% Total Revenues $ 3,789.4 12.4% $ 3,927.4 3.6% $ 3,916.8 -0.3%

4

7

42.0%TIP Construction

$1,364M

18.6%Highway Maintenance

$602.5 M

4.1%

6.0%

7.5%

Projected Uses of NCDOT Appropriations2007-08 Total Funding = $3.9 Billion

39.6%TIP Construction

$1,556.6M6.0%

Other Construction$233.9MSecondary RoadsDiscretionary FundsSpot SafetyPublic Service RdsSmall Urban Const.

22.9%Highway Maintenance $898.3M

3.8%

Municipal Aid$149.6M

9.1%

Other Programs $358.7MAviationPublic TransitFerriesReservesOther

7.4%

Administration $292.0MDOTDMVDOHTrust Fund

11.2% Other Agencies $438.3MGeneral FundHighway PatrolPublic InstructionOther

50.2105.4

31.328.1

143.7

172.815.09.12.0

35.0

84.7123.636.447.3

190.7196.6

33.317.7

69%All Construction & Maintenance

8Highway Fund, Highway Trust Fund &Federal Funds 2007-08 ($ in Millions)

Highway Fund$1,832 Highway Trust Fund

$1,128

$1,568 $955

Funding:

Spending:

Motor Fuels Tax$1,179

Registrations $395

Licenses $130

Maintenance

$898

DMV $104

Powell Bill / Secondary Rds $186

Other $380

Highway Use Tax $621

Title Fees & Other $114

TIP$675

Administration $47

Highway PatrolDrivers EdOther G.F. Agencies

G.F. RevenueSource $191Public Transportation

RailFerriesAdministrationHwy ManagementOther ConstructionOther

General FundTransfers $437

$264

$173

Motor Fuels Tax$393

Other $128

Other $61

PTGHSPPl & ResAirports

TIP$882

$943

$943

Federal Funds

Powell Bill /Secondary $138

Cash Management PackageEEP $54

Debt Service /Major Rep $95$73

223184336176

$1973316

5

9

State Transportation Revenue Sources

Motor Fuel Tax 55% Highway UseTax 25%

Fees20%

10Principle Differences Between HighwayFund and Highway Trust Fund

Highway Trust FundHighway Fund

Motor Fuels Taxes65%

Maintenance49%

Appropriation

Highway Use Tax 55%

Construction 94%

Statutory Formulas

Major State Revenue Source

Biggest Program

Primary Method of Allocation

6

11

2007-08 Fund Sources

65%

29%

59%

2.2%Other

$41.2 M

64.4%Motor Fuels Tax

$1179.3 M

33.4%Fees

$611.6 M

0.1%Investment Income

$1.1 M

55.0%Highway Use Tax

$621.0 M34.9%

Motor Fuels Tax$393.1 M

10.0%Fees

$113.1 M

HighwayFund

Highway Trust Fund

12

2007-08 Fund Uses

6.5%Municipal

Aid$56.6M

Highway Trust Fund

80.5%Transportation

$908.5M

49.0%Maintenance

$898.3M

5.1%Municipal aid

$93.1M14.5%

Other Agencies$265.8M

12.0%Admin

$220.3M

10.4%Transit / Other

$189.5M

9.0%OtherConstruction

$165.1M

HighwayFund

15.3%General Fund

$172.5M 61.95%Intrastate$539.4M

25.05%Urban Loops

$218.1M

Sec Roads$94.3M

% of Title Fees 6.5%

$56.6M

4.2%Admin

7

13

Net Transportation Budgets

2 0 0 6 - 0 7 2 0 0 7 - 0 8 2 0 0 8 - 0 9

HF T F Total HF TF Total HF TF Total

Certified Budget 1,794 1,101 2,894 1,832 1,128 2,960 1,811 1,139 2,950

Agency Transfers (226) (58) (284) (264) (173) (437) (262) (173) (435)

Net Transportation Funding 1,567 1,043 2,611 1,568 956 2,524 1,549 966 2,515

Net Transportation Funding Over/(Under) FY 2006-7 0 (87) ( 8 7 ) (19) (77) ( 9 6 )

14Federal Transportation Revenue SAFETEA-LU

Rate of Return - Highway Programs

90.5% to 92%

25%

50%

75%

100%

NC - Donor State OTHER - Recipient State

Other EarmarksEquity BonusHigh PriorityOther Programs - 6Core Programs - 6

8

15

Federal-aid Funds

Surface Transportation

Program30%

National Highway System

25%

Interstate Maintenance

12%

Bridge Program

16%

CMAQ3%

Other Programs

1%

Safety 3%

Appalachian Development

4%Earmarks6%

16

1989 Equity Formula

50%POPULATION OF REGION

AS PERCENT OF STATE

25%REMAINING

INTRASTATESYSTEMMILES

25%EQUALSHARE

Loops , CMAQ, and Competitive Federal Grant Funds Excluded

9

17Relationship Between Divisionsand Funding Regions

14

2

3

810

13

14

5

6

79

11

12

AA

BB

CCDD

EE

FF

GG

18Remaining Intrastate Mileageby Division

0

50

100

150

200

250

300

350

1 2 3 4 5 6 7 8 9 10 11 12 13 14

Division

Mile

s

Total miles to complete

Remaining miles to complete

10

19

YearRegion

2007 2008 2009 2010 2011 2012 2013 Total

ABCDEFGTotal

Annual Funding Balance

202007-2013 TIP Equity FormulaAllocations

Average

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

A[1 & 4]

B[2 & 3]

C[5 & 6]

D[7 & 9]

E[8 & 10]

F[11 & 12]

G[13 & 14]

Region [Divisions]

Allo

catio

n

11

212007-2013 TIP Equity Formulaper Capita Allocations

Region[Divisions]

Average

Region[Divisions]

0

200

400

600

800

1,000

1,200

1,400

A[1 & 4]

B[2 & 3]

C[5 & 6]

D[7 & 9]

E[8 & 10]

F[11 & 12]

G[13 & 14]

(Dol

lars

)

22

Two Year TIP Process

CurrentProgram

Public Meetings

Draft TIPDevelopment

Reviews andAdjustments

Public Meetings

TIP ReviewSessions

BOT Approvalof TIP

Governor Approval

MPO Approvalof MTIP

Draft TIP

Adjustments

Year 1 Year2

We arehere

12

23

Factors Impacting the TIP Process

TIP

ProjectDevelopment

TimePriorities

Equity FormulaFunding

Constraints

24

Project Development Stages

TIP

Feasibility Study12-18 months

Environmental Documentation

CE - 18-24+ monthsEA/FONSI - 3-7+ years

EIS - 5-10+ years

Design12-36+ months

ROW / Utilities /Environmental

Permits12-24+ months

Initiate planning process per TIP schedule

Construction1-4+ years

Add tolettingschedule

Place onROWauthorizationlist

Record of Decision issued

13

25

The Programming Process

Cost vs.availablefunds

Needs:•Travel Services

•Reduce congestion•Improve safety•Enhance mobility

•Economic Development•Equity•Environmental Protection

26

Sample Distribution Formulas

• Highways Equity Formula (except loops, CMAQ & CompetitiveFederal Funding)

• Powell Bill 75% Population + 25% Mileage• NC Moving

Ahead Equity Formula

• SB 1005 Equity Formula• Contingency Statewide by Request• Contract

Resurfacing 50% Needs + 37.5 % Mileage + 12.5% Population• Small

Construction Equal by Division

• Secondary RoadConstruction ∑

Ψ

Ω±∑ nN

1*1 $ to County Mileage/Statewide Mileage

• Maintenance 90% Mileage + 10% Population• Economic

Development Equal by Division

14

27FY 2000-2007 TotalExpenditures by Division

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

1 2 3 4 5 6 7 8 9 10 11 12 13 14Divisions

$ in

Bill

ion

s$

in B

illio

ns

28

All DOT Funding Sources

• Gas tax is not the only state DOT funding source - all states usemultiple sources

– Gas tax (federal, state and local), DMV fees, vehicle taxes,tolls, general fund taxes and fees, debt, local taxes and fees

– You cannot compare one state tax or fee versus anotherwithout looking at the whole funding mix

Gas Tax

UseTax

Tolls

Sales Tax

Local Support

Debt

DMV Fees

General Fund

15

29State DOT’s:Sample Ways of Funding

•Sales Tax

•Personal Income Tax

•Cigarette Tax

•Liquid Fuels Tax

•Motor Vehicle Rental Tax

•Motor Vehicle Lease Tax

•Vehicle Registration Fee

•Vehicle Title Fee

•Tire Tax

•Vehicle Property Tax

•Property Tax

•Real Estate Transfer Tax

•Transportation Impact Fees

•Casino Revenue

•Lottery

•Highway/Bridge Toll Revenue

30All Revenues (% Contribution)For State-Administered Highways - 2003

Bonds Federal

StateMotor-Fuel

Taxes

Motor-Vehicle and Motor-

Carrier Taxes

Road and Crossing Tolls

Appropriations from General

Funds

Other State, Local & Misc

Issue of Bonds

FHWA, FTA & Other

Total Receipts

Florida 21% 9% 11% 3% 4% 28% 25% 100%Georgia 17% 13% 1% 11% 16% 0% 43% 100%North Carolina 35% 14% 0% 0% 18% 0% 33% 100%South Carolina 28% 12% 1% 0% 4% 5% 49% 100%Texas 31% 13% 2% 1% 7% 8% 38% 100%Virginia 14% 12% 3% 3% 15% 33% 20% 100%50 State Average 21% 12% 6% 4% 9% 17% 32% 100%

Source: Highway Statistics - US Department of Transportation Federal Highway Administration

State RevenuesHighway-User Revenues General Fund & Other Revenues

16

31Revenue and Disbursement Rankingsfor State-Administered Highways - 2003

$ Thousands

State Miles Rank Lane-Miles Rank$ / Lane-

Mile Rank$ / Lane-

Mile Rank$ / Lane-

Mile RankFlorida 12,052 18 40,834 13 77$ 3 166$ 4 155$ 4Georgia 17,872 10 46,729 11 23 24 40 29 40 29North Carolina 78,641 2 167,331 2 10 44 15 49 17 47South Carolina 41,475 4 89,562 4 5 49 10 50 12 50Texas 79,494 1 189,584 1 17 33 35 33 33 34Virginia 57,323 3 123,834 3 13 38 27 39 26 4350 State Average 772,555 1,823,456 24$ 49$ 50$

Source: Highway Statistics - US Department of Transportation Federal Highway Administration

State Revenues All Revenues Total Disbursement

32Transportation System Impacts“The Perfect Storm”

• Growing Demand on System

• Increasing Cost of Supplies

• Declining Funding

• Aging Infrastructure

17

33

Growth

-50%

0%

50%

100%

150%

200%

250%

300%

1970 1975 1980 1985 1990 1995 2000 2005

Vehicle Miles Traveled

Population

DOT Budget in 2005 $(State Funds Only)

34

NC Population Growth

0

2

4

6

8

10

12

14

2000 2005 2010 2015 2020 2025 2030

(in

Mil

lio

ns)

Rank:11

(VA - 12 SC - 26)

Rank:11 Rank:10

(Surpassing New Jersey)

Rank:10 Rank:9

(Surpassing Michigan)

Rank:8

(Surpassing Georgia)

Rank:7

(Surpassing Ohio)

18

35NC Estimated Average Annual DailyTruck Traffic (1998)

36NC Estimated Average Annual DailyTruck Traffic (2020)

19

37

Inflation - Update

Construction Inflation80% Since 2002

0

20

40

60

80

100

Concrete Steel Asphalt

% I

ncre

ase

38

Average State Tax Per Gallon

1963 Average Rate

1963AverageState Rate

7.5¢

25¢

20¢

15¢

10¢

5¢

0¢InflationAdjusted

4.8¢

MileageAdjusted

2.4¢

Actual

21.6¢

2003 State Rates

20

39

Uncertain Federal Outlook - Highway

(20)

(10)

-

10

20

30

40

50

1995 2000 2005 2010 2015

$ in

Bil

lio

ns

ReceiptsOutlaysEOY Balance

40

Uncertain Federal Outlook - Transit

(8)

(6)

(4)

(2)

-

2

4

6

8

10

12

1995 2000 2005 2010 2015

$ in

Bill

ion

s

ReceiptsOutlaysEOY Balance

21

41

NC Bridge Age

0

500

1000

1500

2000

2500

0-5

10-1

5

20-2

5

30-3

5

40-4

5

50-5

5

60-6

5

70-7

5

80-8

5

90-9

5

>100

AGE (Years)

Bri

dg

es

0%

20%

40%

60%

80%

100%

Def

icie

nt

42.6%

42

Bridges Coming of AgeBridges Coming of Age

• 8300 bridges coming of age - next 20 years.– Need to address over 400 per year (2010-2030)

we currently average letting about 100 per year– Need to apply replacement, rehabilitation and

preservation strategies– Delayed action will result in higher replacement,

rehabilitation and preservation costs

22

43

Growing Funding Gap

Timeframe

Timeframe

“DRAFT ESTIMATE”

2005 to 2030

2001 to 2025$55 Billion

$84 Billion

$57 B

$122 B

44

Other State Funding Gaps

Year $(Billions)

2006 86

2005 65

2004 108

2005 74

2003 50

- 40,000 80,000 120,000 160,000 200,000

Florida

Georgia

South Carolina

Virginia

North Carolina

Texas

US Average

Lane-Miles

13

11

2

4

1

3

23

45

Needs Analysis-Complex Process

“Quantitative Tools PLUS Qualitative Assessment”

• Similar approach as 2001 w/ more sophisticated tools

• 25-yr Timeframe = 2005 (baseline) / 2030 (horizon)

– Hwys = HERS-ST (FHWA) vs. HPMS-AP (consultantmodified)

– Bridges = NBIAS (FHWA) vs. BNIP

– NC specific deficiency Conditions, Design Standards & UnitCosts are KEY!

• Non-Hwys = survey/inventory by DOT modal staff− Capital/Operating projections, local sources

46

DRAFT 25-Year Needs

$95

$ 6 7

$27

$ 1 7

0

2 0

4 0

6 0

8 0

100

120

140

2005 Dollars 2001 Dollars

$ in

Bill

ion

s

NON-HWY

HWY & BRG

24

47DRAFT 25-Year Needs (all modes)- Improvement Type Comparison -

Maint. & PreservationModernization

Expansion

$53

$30

$25

$23

$44

$31

0

20

40

60

80

100

120

140

2005 Dollars 2001 Dollars

$ in

Bill

ions

48

Needs by Tier

Statewide Regional Subregional0

10

20

30

40

50

60

Statewide Regional Subregional

$ in

Bill

ions

AccruingBacklog

2001 Dollars2005 Dollars

25

49ASCE Report CardIs A Wake Up Call!

"A Crumbling InfrastructureCannot Support A Healthy Economy"

SUBJECTAIRPORTS D+ ROADS DBRIDGES C- SCHOOLS C-DAMS D STORM WATER C-DRINKING WATER C+ WASTE WATER C-RAIL B- NC GPA C-

ASCE- American Society of Civil Engineers

50

Congestion

0 10 20 30 40 50

1995

2005

Hours of Delay

85 Area AverageRaleigh-DurhamCharlotte

Source: Texas Transportation Institute

30 Area Medium Average

26

51

US Logistics Survey

No NC city ranked in top 50 logistics friendly cities

52US Logistics SurveySouthern Subset

Only 1 NC Location in Top 20 South Logistics Friendly Cities

GreensboroRanked 20th

27

53

No 21st Century Logistics Plan

54

Example Trans Texas Corridor

28

55What is the State CurrentlyDoing About It?

• Cash Management

• Targeting Investment to Long Range Plan

• GARVEE Bonds

• Tolling

• NCDOT Transformation

• EEP

• Corridors of the Future

• Traffic Management

• Statewide Logistics Plan

56

Need To Do More

• At a minimum, NC's transportation funding needs to keeppace with state growth and construction inflation

• Leverage incremental new funding to accelerate projectdelivery

• Open to Best Value Procurement, Multi-state Alignments,PPP Investment and Other Funding Options

• Statewide Prioritization

29

57

Solving NC Transportation Problems

•Not Simple Matter of Revenue

•Requires a 3 Step Approach

1) Improve NCDOT Organization & Process to becomemore efficient and impact focused

2) Establish Statewide Prioritization Process

3) Determine Incremental Resources/Revenues toachieve desired outcomes–Dependent on 1 and 2

58

Closing

• Transportation Infrastructure Requires ImmediateAttention to Address Local, State and GlobalEconomic Needs

• Funding Gap is Not Going Away

• Will Need Help to Address This Need

30

59

Current NCDOT Initiatives

APPENDIX

60Targeting Investment toLong Range Plan

29

%

37

%

37%

36

%

36%

37

%

37%

37%

38

%

37%

37

%

38%

41%

49

%

44%

43% 39

%

45%

41

% 31%

33%

34

%

36%

37

%

36%

31%

22

%

19

%

20%

25

%

19%

23

% 32%

30

%

28

%

27%

26

%

26

%

28%

0%

20%

40%

60%

80%

100%

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

Ta

rge

tP

RE

SE

RV

AT

ION

EX

PA

NS

ION

MO

DE

RN

IZA

TIO

N

ACTUAL DRAFT 2007-13 STIP & Maintenance

31

61FY 2000-2007 Per CapitaFY 2000-2007 Per CapitaExpenditures by DivisionExpenditures by Division

0

2

4

6

8

1 2 3 4 5 6 7 8 9 10 11 12 13 14

Divisions

$ in

th

ou

san

ds

62

11. I-4714

1. B-2500

2. B-3637

3. B-5014

4. I-2808 A

5. I-2810

6. I-3600

7. I-3803 B

8. I-3819 A

9. I-4709

10. I-4711

12. I-4715

13. I-4718

14. I-4720

15. I-4723

16. I-4904

17. I-4906

18. I-4910

19. I-4913

20. I-4914

21. I-4915

22. I-4917

23. I-4918

24. I-5001B

25. I-5002

26. I-5003

27. I-5004

28. I-5005

29. I-5006

30. I-5007

31. R-2510C

32. R-2554BA

33. R-2606B&C

34. R-2814B

35. R-2823

36. R-3601

37. R-4416

38. R-5021

39. U-0209B

GARVEE Projects

32

63North Carolina Turnpike AuthorityProjects Under Study

Red denotes possible public-private partnership projects

64

Transformation Beginnings

21st Century NCDOT Vision

–Focus on Network Connectivity & Function, not justProjects

–Enhance Systems Operations, to leverage existinginfrastructure

–Establish Network Performance Standards

–Greater Internal Efficiency, Ownership and Accountability

–Prioritized, Outcome-Based Budgets

–Link Infrastructure Delivery and Statewide CommerceGoals

–Culture Shift, become true Service Provider

33

65

Where are we Today?

Growing Demand on System• Doubling of VMT by 2030• NC population projected to grow by 50% between

2000 and 2030, “7 th most populous state by 2030”

Increasing Cost of Supplies• 80% construction supplies inflation since 2002• Spike in global asphalt, cement, and steel prices

expected to continue

Declining Funding• State gas tax purchasing power has declined

(inflation and mpg)• Federal Highway Trust Fund program projected to

run out of funding by 2009• Transportation funding flat/declining for FY2008/09*

* Gas tax cap and increased other agency supportSource: ASCE Report Card; NCDOT internal data

Strain of external trends ASCE Report Card

NC current state:Bridges C-, Roads D

Airports D+Bridges C-Dams DDrinking Water C+Rail B-Roads DSchools C-Storm Water C-Waste Water C-

NC GPA C-

On current course,overall grade willdrop to a D in 6

years

66Where are we Going?21st Century DOT

C-

• Improving NCInfrastructure

– A statewide logistics plan

– A transformed DOT• Clear strategic direction• Efficient execution• Accountability for

performance

– Adequate and sustainedfunding

Current scorecard

B

Desired scorecard