Determine the economic impact of preservation spending for roadways in the State of Mississippi.
A state's transportation system is vital to its economic health. Transportation serves key industries and economic development assets in the state, provides for emergency routing, serves local commuters, and is the gateway into the state for millions of visitors each year. Funding for transportation at the Federal and state levels has not kept up with growing demand and needs. Under the current funding stream, it is projected that many states will fall even further behind in terms of maintenance, preservation and expansion of their roadway systems. Deteriorating pavement and bridges and increased congestion have a direct impact on transportation costs for Mississippi businesses and residents. As transportation costs increase, the state's ability to compete in a global market decreases. Maintaining a state of good repair is critical to ensuring transportation positively impacts the economy. As part of its 2040 Statewide Transportation Plan, MULTIPLAN, development, Mississippi Department of Transportation (MDOT) evaluated the implication of alternative spending levels for preservation and maintenance for the state-owned roadway system. Cambridge Systematics helped to conduct the economic analysis.
To better understand the economic costs and return of the two preferred alternatives – Expected Funding and Adequate Funding- an economic analysis of the impact of changes in pavement and bridge conditions and congestion levels was conducted. The analysis examines and is organized around two funding scenarios:
Key findings from the economic analysis include:
Based on MDOT's PCR measure, 60 percent of the pavement on the state-owned system is currently in fair or better condition. By 2040, it is projected that only 47 percent will be in fair or better condition under the current funding scenario.
The direct impacts of only investing $371.5 million per year (in 2014 dollars) for pavement on the state-owned system under the expected funding scenario is estimated to be a $22.8 billion increase in vehicle operating, travel time delay and motor vehicle crash costs.
The direct impacts of investing $694 million per year (in 2014 dollars) on pavement for the state-owned system under the adequate funding scenario is estimated to be a $59.7 billion (in 2014 dollars) reduction in vehicle operating, travel time delay and motor vehicle crash costs.
Under the expected funding scenario, it is projected that the increase in congestion is expected to give rise to an additional 99,600 hours of delay every day. This translates into an additional $10.1 billion in transportation costs for Mississippi residents and businesses by 2040. If Mississippi were to invest in expanding the state-owned highway network to meet the minimum performance targets of level-of-service of C or better for rural roads and D or better for urban roads, drivers would spend an average of 200,000 fewer hours on the roadway daily than if there are no investments. This would lead to transportation costs reduction of about $3.6 billion between 2016 and 2040.
The expected funding scenario leads to an additional $42.7 billion in transportation costs between 2015 and 2040. Adequate funding to meet minimum highway performance targets leads to about $62.5 billion in transportation cost savings for Mississippi businesses and residents.
Table 1.1: Total Direct Impacts of Alternative Highway Investment Levels, 2015-2040 (billions of $ 2014)
Vehicle Operating Costs
Travel Time Delay Costs
Motor Vehicle Crash Costs
Average Annual Cost per Driver
Table 1.2: Total Economic Impact of Alternative Investment Levels in Mississippi's State-Owned Highways (2016-2040)
Jobs (avg annual units)
Income (billions of $2014)
GRP (billions of $2014)
Our evaluation demonstrated the cost of the status quo as well as the potential return on increased investment in maintaining the roadways in a state-of-good-repair. The results show that Mississippi drivers will pay significantly more in terms of increased travel costs under the status quo than they would under an adequate funding scenario. In addition, the economic implications of the status quo are negative compared to a positive impact arising from providing adequate funding to maintain the system. MDOT is using this insight to make investment decisions in an effort to mitigate the negative implications to the extent possible. They are also using the results to inform the public and elected officials about the implication of critical funding decisions going forward. In addition, the Mississippi Economic Council, the state's Chamber of Commerce, has embarked upon a campaign for increased transportation funding as result of these findings.