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Montana's transportation future: opportunities around the next curve.

Transportation--the movement of people and goods over physical distance--has always been a vital ingredient of economic growth. Prosperity is derived from trade, which requires access to markets, workers, and suppliers--both in our own backyard and beyond. We depend on the highways, railroads, airports, pipelines and other infrastructure around us to make that happen. With innovations in technology and increasing globalization affecting all aspects of life, we should be aware that the demands on that infrastructure, particularly in rural states like Montana, are growing and changing.

Transportation and the Economy

The impacts of transportation on the economy are all around us. Roads, bridges, railroad crossings, and airports are built, maintained, and expanded, creating thousands of jobs in construction, engineering, and professional services. But long after the pavement is dry, those investments continue to pay dividends as workers, shippers, governments, and businesses use them to connect to one another. Transportation affects economic productivity and growth both directly and indirectly as reflected in the jobs it enables and the mobility it provides for people and products.


Highway construction, for example, supports 27 jobs for every million dollars spent. Of these, 10 jobs are direct (construction related), four are indirect (supply sector), and 13 are induced jobs (general economy). (1) The transportation sector also contributes vehicle manufacturing, infrastructure development and, of course, moving goods to market.

A 2002 study of the impact of expenditures by the Montana Department of Transportation showed that every dollar it spends in the private sector generates another $0.47 in indirect and induced spending throughout the state economy.

Freight shipments valued at $44 billion travel every year on Montana's roads. According to the American Association of State Highway and Transportation Officials, domestic freight tonnage for all modes of transport is expected to increase 50 percent by 2020; freight movement by trucks alone is estimated to increase nearly 60 percent. Based on the Federal Highway Administration's Freight Analysis Framework, the value of Montana freight shipments will go from $44 billion (2002) to $130 billion by 2035 (Figure 2).

As shown in Figure 3, trucks are the primary mode (vs. other modes) of freight movement for Montana, carrying 69 percent of goods entering the state, 32 percent of goods leaving the state, and 89 percent moving within the state. (2)

Key Factors Driving Transportation Demand

Policy, demographics, geography, freight, and technology all play a role in creating and maintaining an effective transportation system, and their effects in Montana, a large state with a small population, are particularly acute.

While in the short term we can expect transportation demand to fluctuate with the economy, a longer perspective reveals three crucial trends that stand out as especially important in Montana. These are:

* the geography and pace of Montana population growth;

* the aging of Montana's population; and

* the evolution of Montana's economic base, especially growth in nonresident visitors.

Statewide, Montana's population increased significantly between the years 1996 to 2006. But that growth was concentrated in the state's seven most urban counties. The 22 most rural counties in Montana collectively lost 11,755 people during the same period. The seven most urban counties, by contrast, gained 61,573 people between 1996 and 2006. This pattern of growth and decline in different corners of the state puts strains on both transportation capacity and finance.

By 2030, a quarter of Montanans will be 65 or older, creating one of the largest older population fractions of any state. (3) This aging population will impose different demands on transportation, such as transportation assistance for health care and daily needs.

Nonresident visitors are a powerful generator of economic activity in Montana, offering significant opportunities for economic growth throughout the state. But tourism depends crucially on the safety and efficient operation of our roads and airports. As Americans live longer and enjoy more leisure time, those demands will tax the capacity of Montana's transportation system.

Some of the Challenges We Face

Rapid population growth, increased tourism, and expanded freight movement are all putting strains on the capacity of our highways. Rural roads are a major and essential part of our nation's highways system, and they are what move us most. Rural roads comprise 80 percent of national road miles and carry 40 percent of vehicle miles traveled. Ninety percent of rural roads are two lanes or less.

As travel on secondary highways increases, accidents will increase as well. Accidents and congestion have a detrimental fiscal impact on job productivity and freight mobility. The high incidence of crashes in rural areas has a disproportionate impact on rural law enforcement agencies, health care facilities, and transportation agencies, which have limited fiscal resources.

Rural households travel 38 percent more miles than urban households, even though they make 5 percent fewer trips. Nearly 40 percent of the country's transit-dependent population, primarily senior citizens, persons with disabilities, and low-income individuals, live in rural areas. Due to a lack of travel services, rural populations are more automobile dependent than their urban counterparts.

Public transportation has rarely been viewed as viable in rural areas due to low population densities and long travel distances. It is time to move past this mode of thinking. The Bozeman-area transit service, Streamline, and a nearby regional transit system, Skyline, provide excellent examples of how public transportation can work in rural environment to serve the elderly, students, tourists, and others without destroying the rural character people are seeking.

As strains on capacity increase, our aging infrastructure is becoming a victim of financial crisis. The Highway Trust Fund, established in 1956 to build and maintain our highway system using federal fuel taxes, faces a dramatic revenue shortfall and struggles even to maintain the current capacity of our highway system.


Opportunities for Our Future

A healthy economy demands a strong transportation infrastructure. Through advanced technologies to enhance safety, expanding services to rural and elderly populations through public transportation, coordination of freight movement at regional levels by developing intermodal facilities, and integrating transportation and tourism to promote rural economic development, we can address these transportation challenges. Now is the time to put the focus on developing a complete, integrated, seamless national transportation infrastructure that would allow people and goods to move safely and efficiently across and throughout the country.


(1) Federal Highway Administration. otps/pubs/impacts/impacts.pdf.

(2) Davis, Gregg E. & Polzin Paul E. The Revenue Contribution of Montana Department of Transportation Expenditures to the General Fund. MDT. revenue_final_report.pdf.

(3) Census and Economic Information Center.

Steve Albert is director of the Western Transportation Institute at Montana State University--Bozeman.
Figure 2
Freight Shipments by Value
All Modes of Transportation
2002 and 2035

Billions of Dollars

                2035    2002

To State        $59     $16
From State      $26     $12
Within State    $45     $16

Source: Office of Freight Management and Operations, FHWA.

Note: Table made from bar graph

Figure 3
Montana Freight Shipment by Transportation Mode, 2002


                     Within State   From State   To State

Truck                     89%           32%        69%
Rail                       0%           15%         1%
Water                      0%            0%         0%
Air, air Truck             0%            0%         0%
Truck & Rail               0%            0%         1%
Other Intermodal           2%            5%        13%
Pipeline & Unknown         8%           47%        13%

Source: Office of Freight Management and Operations, FHWA.

Note: Table made from bar graph
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Comment:Montana's transportation future: opportunities around the next curve.
Author:Albert, Steve; Chaudhari, Jaydeep
Publication:Montana Business Quarterly
Article Type:Cover story
Geographic Code:1USA
Date:Mar 22, 2009
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