Our transportation infrastructure is critical for the safety of our people, our quality of life, and continued prosperity. The current Democratic leadership has failed to deliver on transportation and our people know it. They sit in the congested traffic; they drive on the crumbling roads; they watch the years and years of construction delays; and they see the rising costs of projects.

The number one priority of the North Carolina Department of Transportation (NCDOT) is to ensure the safety of the traveling public. In 2007, accidents on North Carolina highways resulted in more than 1,600 fatalities and 125,000 injuries. We rank 6th in the nation in the average number of annual traffic fatalities. These accidents and fatalities cost our people $2.8 billion annually. Sadly, this waste of lives and money does not have to be so high, because safety improvement projects are often straightforward to implement, such as installing guard rails and stop lights, replacing bridges and eliminating dangerous curves in roads. Unfortunately, these projects sometimes do not receive the priority they deserve.

Last year, America witnessed the tragedy of the Interstate 35 West bridge collapse in Minneapolis, Minnesota. This was a wake up call for North Carolina to examine the integrity of our bridges. How are we doing? Not well, North Carolina has over 2,250 structurally deficient bridges, which places us in the bottom half nationally. Returning North Carolina to the “good roads state” is literally a life and death issue.

North Carolina is consistently listed as one of the “best places to live” and “best places to do business” by national publications. In addition to our state’s stunning natural beauty, additional factors that make North Carolina special are our growing economy and excellent job opportunities. Historically our exceptional transportation system helped our state grow its existing businesses and attract new ones. We depend on our transportation system for the movement of goods and services throughout the state. Over 94% of the $267 billion worth of commodities delivered annually to and from sites in North Carolina is transported on the state’s highways. In order to maintain our excellent economic environment, we must keep our infrastructure growing with our economy.

The North Carolina Railway is also an attractive prospect for new and expanding businesses. Estimates show that the ability to ship freight by rail saves businesses $198 million annually. Industries using rail freight services account for more than 24% of North Carolina’s total economy.

We used to take for granted the freedom to get in our cars and drive where we wanted to go. This is no longer true for many North Carolinians as this freedom is being eroded due to increasing congestion. North Carolina ranks third nationally in congestion, trailing only California and New Jersey. Both the Charlotte and Raleigh-Durham areas suffer from severe congestion and are ranked 26^th and 42^nd, respectively, as the most congested regions in the United States. By 2030, it is estimated that Charlotte‘s traffic will be equivalent to present day Los Angeles. Traffic congestion in North Carolina costs licensed drivers $775 million annually in delays and wasted fuel.

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To maintain our quality of life, we need a transportation system that is safe, well maintained, and congestion free, while also providing alternatives such as public transit, light and high-speed rail, and bicycle and pedestrian accommodations. To compete in the global economy of the 21^st Century, we need a world class transportation system.

Today we have a choice: we can be proactive and leave our children a transportation system that will serve them well into the future; or we can maintain the status quo, leaving them an inferior transportation system, diminished economic opportunities, and a diminished quality of life.

Clearly we must change our way of doing business, and the transformation of our transportation system depends on new leadership, a reformed structure, clear priorities and goals, and efficient use of our transportation dollars.

Governor Martin and Secretary Harrington proved that if effectively led, the professionals at NCDOT will deliver a first-rate product. I will appoint a strong leader and proven manager as Secretary of Transportation and a Board of Transportation that understands that the public interest is to be served--not self interest and political empire building. The first priority will be to rid the Secretary's office of overhead, and build a staff based on competence and professionalism, not cronyism. 

The biggest change we need at NCDOT is a change of attitude. We need a new generation of leaders with a “can-do” attitude. We must put in place a leadership team that is focused on performance, productivity, quality and day-to-day execution of a simple business plan. The good news is that NCDOT’s people are its most valuable asset, and they are a completely undervalued asset at this point. The NCDOT has tremendous talent and a depth of technical expertise. With a dramatic change in leadership, we can unleash the true potential of the organization.

I will ensure the new NCDOT leadership demands accountability with real consequences for poor performance, because individual performance is critical for team success. Poor and mediocre performance is simply not acceptable and won’t be tolerated. The majority of NCDOT employees are hard-working, dedicated individuals, but like many bureaucracies, the policies and structure allow for complacency and inefficiency in the workforce.

Today at NCDOT, the reward for doing good work is getting more work, while unproductive individuals get less and less responsibility because they do not deliver on their job responsibilities. Even worse, the state’s pay system does not allow managers to reward performance. Each year, the state legislature comes to Raleigh and approves an across-the-board pay raise for state employees, regardless of merit. Overall team morale is severely compromised when some individuals work diligently to achieve a goal while others do little to contribute. Morale suffers even more when managers tolerate such behavior.

This culture must change. Unproductive workers must be removed and the rising talent must be promoted. In the new NCDOT, pay, promotions and responsibility will be based on merit and not seniority.

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The number one transportation problem we are facing is that NCDOT can’t efficiently deliver projects. The NCDOT is experiencing 13-14% annual inflation in construction costs due to soaring steel and concrete prices. The cost of construction has increased 80% since 2002. Therefore, a one year delay in $1 billion worth of projects costs the state at least $130 million in increased construction costs. The state is losing hundreds of millions of dollars simply because the NCDOT cannot deliver the transportation program it is charged with. We can transform NCDOT into a world class agency, but it’s going to take significant change. Here is how we do it:

• Restructure the Department into a geographic-based operation to align the organization for performance and accountability

• Consolidate the North Carolina Turnpike Authority into the new NCDOT structure

If you look at the DOT’s organizational structure, you can understand why the department has struggled to work together in a coordinated fashion. The people who oversee road construction and maintain the roads are organized into 14 Divisions (Operations), while the people who plan and design the roads are organized by area of expertise (Preconstruction). This structure has led to functional “silos” with poor communication between the groups.

The chain of command for the Divisions is relatively simple; each Division Engineer reports to the Chief Engineer in Operations and works closely with a member of the Board of Transportation who represents the public in that geographical area. Divisions, which are located throughout the state and organized geographically, are very closely tied to the communities they serve and understand the impact their performance has on the public. The public can tell if pot-holes are not being filled, if snow is not being removed, or if a construction project is taking too long to complete.

Preconstruction, on the other hand, is consolidated in Raleigh and is organized by expertise, such as transportation planning, project development, highway design, and right-of-way branches. The confusion comes from a lack of clear priorities or when priorities are re-aligned without consideration of the Districts or the public. Here is where real progress can be made.

Preconstruction should be organized into seven regions, each representing two Divisions. Specific teams within each preconstruction region would be directly accountable to Division Engineers. These regional organizations would have all the capabilities needed to deliver a project. It is important that all steps in the process are adequately aligned to maximize service from the Board of Transportation, Divisions and Preconstruction.

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It makes no sense to have two separate transportation entities in North Carolina. Currently, all work by the Turnpike Authority is being reviewed, approved and paid by NCDOT. Ultimately, when Turnpike projects get built, the Turnpike will contract with NCDOT to maintain the roads. So why keep these agencies separate? The taxpayers end up paying for a lot of things twice.

The Turnpike should be a Division within NCDOT similar to the Rail, Aviation or Ferry Divisions. This would eliminate redundant administrative positions and save money. This would also eliminate the Turnpike board, which is redundant with the NCDOT’s Board of Transportation. Your tax dollars should be spent in accordance with good business sense.

Everything NCDOT does should be completely transparent to the public. This ranges from how projects are selected and prioritized to studies about the Department. The public should expect nothing less from a state agency. We must set clear priorities and goals, reduce political influence on decision making, and measure performance.

The NCDOT cannot be all things to all people. Due to political pressure, the Department tries to please everyone and as a result constantly juggles projects. A more businesslike approach would be to establish clear priorities and then stick to them. These priorities should be simple:

• Safety projects should always take precedence;

• Our existing infrastructure should be maintained and not allowed to slip into disrepair;

• Reduce congestion on the 7% of our roads that carry over 45% of our traffic;

• Maximize mobility and connectivity on a core set of highway corridors throughout North Carolina, known as strategic corridors;

• Implement projects to promote economic development.

If the professionals at NCDOT were allowed to independently set priorities, we would have an objective approach to prioritizing projects. Unfortunately, Board of Transportation members have too much influence in the selection of projects and how they are programmed into the schedule.

The Board of Transportation’s emphasis must be oversight, not management and internal decision making. The NCDOT also has independent review and oversight from the Joint Legislative Transportation Oversight Committee. To ensure that the Board performs its oversight role without undue political influence, I will:

• Reduce the number of Board seats to 14 to match the regional structure;

• Establish minimum qualifications to sit on the board so members can effectively evaluate what the NCDOT management is telling them;

• Restrict members from influencing project selection, prioritization, and scheduling.

We need to improve the predictability of what projects will actually be delivered by NCDOT. To do this, the Department should split the State Transportation Improvement Program into two sections, a preconstruction plan and construction work plan. The preconstruction plan would represent the 60-month plan. The construction work plan would include projects scheduled for construction in the next 24 months. No project would be allowed to advance into the construction work plan without approved National Environmental Policy Act documentation and a final design.

To measure performance, the Board will set annual performance objectives for the Department based on projects delivered and not only money spent. At the end of the year, the scorecard will be made public so everyone can see if the NCDOT is delivering on its commitments.

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We have spent far too much time arguing over Trust Fund transfers which must be stopped and new road bonds which have been proposed. Throwing more money at a broken system can only result in more waste. Before we take on additional debt, we need to determine how much waste can be cut out of the current NCDOT operation and how we can more efficiently meet our needs with the money appropriated. I’d like to maximize the effective use of our current $3.9 billion annual budget, determine an accurate evaluation of the recurring funding shortfall, and then develop innovative solutions for long range transportation funding.

The good news is that if the NCDOT is reformed and the hard decisions are made as detailed above, the Department will be able to do more with the money it already has. Here is how we will find money within the existing NCDOT:

• Utilize all our federal allocation of bridge funds--NCDOT is currently not spending its entire allocation due to poor project delivery;

• Restructure the Preconstruction section of the Division of Highways and reduce headcount to a level necessary to operate efficiently and effectively;

• Increase productivity of the new structure to accelerate projects and reduce project delays;

• Redirect money out of the secondary roads program as suggested by the Fiscal Research Division of the General Assembly;

• Consolidate the NC Turnpike Authority with the NCDOT to reduce redundancy in costs;

• Consolidate the Ecosystem Enhancement Program with the Clean Water Management Trust Fund or alternatively, consolidate back into NCDOT as an umbrella mitigation bank. This will significantly reduce mitigation costs;

• Take a critical look at the projects within the existing Transportation Improvement Program and set new priorities to eliminate unnecessary pet projects;

• Increase outsourcing to the private sector to achieve cost saving;

• Revise the state’s equity formula that distributes transportation revenue to focus spending where projects are most needed to improve commuter safety and road congestion.

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As necessary as these changes are, they are short-term solutions. With the continued growth of the state, we must implement a new system to finance roads. Future solutions to financing our transportation system include:

• Expanding the use of toll roads in the state;

• Taking advantage of public-private partnerships to leverage private sector funds;

• Study the replacement of the motor fuels tax (gas tax) with a “vehicle miles traveled” tax (VMT).

North Carolina has several toll projects planned to open over the next few years. While tolls should not be viewed as a singular solution to North Carolina’s transportation funding crisis, creative mechanisms like high occupancy toll (HOT) lanes and congestion pricing can help to fund new construction and alleviate congestion.

Reports on the use of HOT lanes and congestion pricing on I-15 near San Diego California have shown that implementation of HOT lanes can alleviate traffic conditions for all highway travelers. HOT lane users believed they benefited from their decision to pay for access while analyses showed that HOT users saved up to 20 minutes in their commutes.

Public-private partnerships have been successfully used in Canada, Europe, Australia and Central America for decades and are gaining prevalence across the U.S. Private firms are responsive to new innovations that can control costs in construction and maintenance. Carefully negotiated partnerships could help to finance some of our most urgent transportation needs and aid the state in developing new mass transit opportunities.

The gas tax is losing its ability to keep up with the needs of our state. The VMT tax is being seriously looked at across the country. The state of Oregon just completed a year-long study, which showed very promising results. The NCDOT should study the new tax strategy and explain to the General Assembly and the public how this might be implemented.

The VMT tax is a consumption tax. It is based on the principal that everyone should pay for how much they use. Citizens are accustomed to paying their water bill and electric bill based on how much they consume. A VMT tax would be paid based on the number of miles traveled on North Carolina roads. We need to consider new financing mechanisms for the future of transportation financing.

Many people would like to turn the responsibility for local roads back over to the counties. This is troublesome since the only funding mechanisms they have at their disposal are property and limited sales taxes and various fees. Dramatically increasing these taxes is not a long-term solution.

Other candidates support the use of bonds. Bonds are best used when paying for one-time capital expenditures. When our annual expenditure needs are outpacing our revenues year after year, we have a structural deficit. Unless we are prepared to post bonds annually, a bond is a band-aid solution. The real solution is to ensure that our tax and fee structure meets the long term transportation needs of our state in the fairest way possible.