FALL 2016 CONFERENCE
Investing in Vital Infrastructure: Learning From the Utah Model
As America’s infrastructure ages, States are looking for innovative ways to meet the costs of vital infrastructure improvements. The Forum heard about the creative investment public-private strategies that funded the modernization of Utah’s infrastructure. Forum speakers examined strategies for States to leverage new energy technologies that are revolutionizing the electric grid and improvements in energy storage that may offer new options for the states’ public utilities.
President & CEO
Utah was one of the fastest-growing States in the nation in 1997, Robert Grow, President & CEO of Envision Utah, told the Forum. And the State faced serious growth-related challenges. As soon as 2010, new water sources would be needed. By 2020, a million new residents will need housing, which will double the amount of urban land, cause crowding and congestion, and put the air quality and Utah’s attractive natural environment at risk. Clearly, the State was on a course where infrastructure needs would outstrip resources.
A diverse group, including business, government, and community leaders, formed Envision Utah, a nonprofit, nonpartisan, voluntary partnership with the goal of preserving Utah’s quality of life for future generations. They rejected the traditional planning approach, which Mr. Grow described as a recipe for a DEAD policy: Decide – through analysis and research; Educate – the public about the solution; Announce – the plan and Defend – the plan and yourself. Instead, they founded their process on the premise that the “public” has the right to envision its future, and public officials should serve that vision. Furthermore, that the “public” will make good choices if presented with real options.
Envision Utah engaged all the stakeholders, including business leaders, developers, utility companies, local and State government, conservation and citizen groups, religious leaders, education leaders, and the media to be partners in engaging the full community in envisioning the future of the State.
A starting point was to discover what values people shared, and why they cared about those things. “Lasting change starts with values,” Mr. Grow observed. “Values are widely shared and create consensus among diverse groups. Personal decisions are ultimately made to satisfy values. Values and the choices they compel drive markets.” Understanding people’s values allowed the Envision Utah team to communicate based on people’s values. “Your message must be personally relevant or people won’t get involved, change, or act differently,” Mr. Grow advised.
The values map plots several levels of community values: the community attributes to be considered, the desired benefits, and the feelings that people seek. By charting a course linking attributes, benefits, and feelings, “value ladders” were developed that helped define the scenarios Envision Utah would present to the public for their consideration. The value ladders identified were:
• A safe and secure environment
• Personal and community enrichment
• Financial security
• Personal time and opportunity
Map of Utah Values
Based on these value ladders, Envision Utah identified 11 topics that would affect the future of the State. Eight action teams made up of 400 Utah experts spent 18 months developing potential scenarios across each topic for consideration by the public. These scenarios illustrated what development would occur in terms of housing density and traffic, if that scenario was played out. Voters could compare options and vote for the scenario they preferred.
Salt Lake City Development Scenarios
Motivated to engage by public awareness campaigns that spoke to their values, 52,845 Utahns responded to a survey about their vision of their future. The public chose among the scenarios to identify a vision they could believe in and would support. This process led to the best understanding of what Utahns want for the future.
A combination of survey results, values, and input from the expert teams formed a vision for Utah’s future. Utahns want a future that is safe, secure, and resilient; neighborly, fair, and caring; prosperous; and, healthy, beautiful, and clean. To achieve that bright vision of the future, Envision Utah identified four essential implementation pathways:
• A network of quality communities
• Homes, buildings, landscaping, and cars of the future
• A thriving rural Utah
• People prepared for the future
Extensive advertising that included TV ads, video endorsements from leaders across all sectors, and compelling emotional content, helped educate the community on the positive impacts of specific infrastructure proposals on each value ladder. The videos demonstrated how strategies for education, transportation, and the economy would support the values that Utahns cherish.
How well is the program for Utah’s future performing?
Projections were that in the Greater Wasatch Area, another 300 square miles would be developed by 2020. “We’re on pace to only develop 100 square miles. That means 200 more square miles of open space, including agricultural land has been preserved,” estimated Mr. Grow. “There are 200 square miles that don’t have infrastructure on them. Pipes and roads don’t have to stretch as far,” he continued.
Because home lots are smaller, per capita water consumption is down 25% from projections.
“You don’t end up with a transit system if people don’t vote for it,” Mr. Grow acknowledged, commenting that when light rail was first introduced as a future concept, people thought it was a “Commie threat.” Eventually, after extensive advertising, light rail had an 88% positive rating. To date, 140 miles of rail and 70 stations have been added to the system, and 195,000 people can walk to a rail stop.
“People should have a choice about what kind of community they live in. But modeling shows that if we design our land uses right in key places, it makes a big difference.” One of those places is around rail stops. To date, $185 million has been invested to purchase 175 miles of rail right-of-way to create nine future transit corridors. “With the right development in the right places, we can hit our Quality Growth Strategy goal of having 700,000 within walking distance of rail stop by 2020. That doesn’t mean everyone has to live near a rail stop, but those who want to live and travel that way can,” Mr. Grow concluded.
The Utah Unified Development Plan
Wasatch Front Regional Council
The American Society of Consulting Engineers’ report card on US infrastructure shows a failing system: aviation, dams, roads, and transit earn a “D,” while bridges and rail merit only a “C+.” The overall rating for US infrastructure is a dismal D+, Andrew Gruber, Executive Director, Wasatch Front Regional Council, told the Forum. He pointed out that federal funds for fixing the failing infrastructure are not forthcoming, therefore the States must do the job.
“One of the things that makes Utah so great is our natural geography,” Mr. Gruber observed, “but, in fact, Utah is the 8th most urban State in US. Approximately 80% of Utahns live with an area called the Wasatch Front that is nestled between two mountain ranges. The geographical constraints caused by this require us to think strategically about how we grow. And how we grow matters.”
Utah’s population is anticipated to nearly double between now and 2050. That means nearly twice as many transportation demands on roads and transit lines, more goods and services to be delivered, more employees commuting to work, and more errands to run. To keep people connected and commerce moving will require an integrated transportation system where Utahns have more transportation choices.
A well-functioning transportation system improves the flow of goods and services through the area, attracts businesses, and enhances quality of life, which is important in attracting a talented workforce. The Utah legislature recognizes this, and, since the 2002 Olympics, has allocated $8.7 billion to expand highway and transit capacities.
Significant investments in road, rail, and trail have attracted 100 new businesses, including Adobe and eBay, forming Salt Lake’s new “Silicon slopes.” Utah continues to rank high nationally on a number of important economic indicators, such as Forbes rating for “best for business,” and a rate of job growth that is double the national average.
How did the legislature successfully allocate billions of dollars to transportation? Mr. Gruber described 5 critical steps to capture the funding needed to create a transit system that works for everyone:
1. Develop a Unified Transportation Plan
2. Consider development patterns
3. Ensure accountability
4. Establish a legislative task force
5. Build stakeholder support
Start with a shared vision, Mr. Gruber advised, and develop a single, comprehensive, unified, statewide plan that takes integrates all modes of transportation, including State roads, local roads, and public transit, and includes all transit agencies: the State Department of Transportation, Metropolitan Planning Organizations, and others.
The Plan identifies the balanced investments in road, transit, bike, and pedestrian infrastructure that are needed across Utah to stay ahead of future growth and take care of the infrastructure investments we have already made.
A few key areas of emphasis in the Plan:
• Mobility – providing transportation choices – the majority of people will drive, but we also provide options – transit, biking, walking, and connectivity between those options.
• Enhanced focus on preserving what we have – infrastructure condition – keep system in a State of good repair.
• Making most effective use of system we have – innovative approaches.
• Coordinating transportation planning with local development patterns for housing and jobs.
The Plan does not presume that resources are unlimited. Instead, it carefully and prudently prioritizes our most critical construction and maintenance needs, providing a blueprint for continuing a track record of sound leadership and prudent investment. Funding the total transportation needs identified in the Plan would require $80.5 billion. “But we don’t just assume that all of our needs will be met,” Mr. Gruber said. The planning group worked together to identify the highest-priority needs and highest-value investments, coming up with a more palatable $67.5 billion priority plan. “Fortunately, the great majority of prioritized needs are funded, due in large part to the leadership of our legislature,” Mr. Gruber reported.
The Plan – Financial Overview
“The unified transportation plan should not be developed in isolation,” Mr. Gruber advised. The Plan proactively considers the relationship between land use and transportation because housing, economic development, and transportation all impact and are impacted by each other. The Plan takes into account growth and development patterns, demographic changes, market demands, and the desired uses of property by local owners and communities. That analysis is the basis to develop the transportation plans to address those objectives. By coordinating land use and transportation, residents are better connected to what they need, so they don’t need to travel as far. They also have more choices for how to get around, Mr. Gruber noted.
Input from all stakeholders identified that the community wants a transportation plan that ensures safety, economic vitality, well-maintained systems, good air quality, and mobility and accessibility. The community must have trust and confidence that its needs have been carefully assessed and the most effective approaches and solutions have been identified. Performance-based planning allows us to understand the impact that transportation investments will make to the overall system. This helps to ensure policymakers and the public that taxpayer dollars are being used carefully and prudently.
The Unified Plan comes with very real, quantifiable benefits that we are able to articulate to policymakers and the public. The Plan served the community goal of economic vitality by increasing the number of jobs and services that Utahns can reach within a specific travel time. The Plan not only reduces congestion, but also promotes access to job and educational opportunities, and allows businesses access to workers and customers.
An economic analysis commissioned by the Salt Lake Chamber of Commerce in 2012 found that investing in the 2011-2040 Unified Plan would nearly double the return on investment for every dollar spent. The Unified Plan saves taxpayers tens of billions of dollars by reducing time spent in traffic due to congestion, lowering vehicle operating costs thanks to better maintained roads, improving safety, and increasing employee productivity.
The study found that funding the Unified Plan will result in nearly 183,000 new jobs in Utah’s economy in 2040. This number includes nearly 55,000 construction jobs and over 91,000 jobs created by efficiencies in the transportation system. Over 17,000 jobs are attributed to enhanced access to markets for Utah companies and 19,000 jobs from new businesses relocating to Utah, in part because of a well-functioning transportation system.
Utah – Job Creation
“Good planning addresses the question of WHAT should be done to meet the community’s needs,” Mr. Gruber said. “And good planning gives the Legislature the confidence to tackle HOW it should be funded.” He reported that, contrary to conventional expectations, the experience of the Legislative Taskforce has been very positive, with bipartisan, bicameral cooperation. The 2014 Transportation Interim Committee created working groups to study several funding options to address the $11.3 billion funding shortfall that had been identified in the 2011-2040 Unified Transportation Plan.
They considered funding options, including:
• Motor fuel taxes
• Alternative fuels and vehicles
• Vehicle Miles Traveled (VMT)
• Registration fees
• Tolling and private/public partnerships
• Local and State sales taxes
The legislature decided to reform the 1997 State gas tax, changing from a tax per gallon to a percentage of the pump price and set a floor to hedge against falling gas prices. This netted about a 5 cent/gallon increase. They also authorized a 0.25% local option general sales tax for the counties that would be distributed for local transit use.
The Salt Lake Chamber’s Utah Transportation Coalition is comprised of the Utah League of Cities and Towns, representing all 244 cities in the State, the Utah Association of Counties representing all 29 counties in the State, private-sector businesses, and chambers across the state, led the effort to raise public awareness and support for increased transportation funding. Engaging community advocacy and building trust in the plan was essential to its success, Mr. Gruber concluded.
Investing in Vital Infrastructure:
Achieving 21st Century Policy Goals with the Electricity Grid and Energy Storage
Associate Director of Domestic Energy Policy Center for American Progress
The US energy system and its electricity grid are fundamental to all the policy goals and concerns of the States, Luke Bassett, Associate Director of Domestic Energy Policy at the Center for American Progress, reminded the Forum. Twenty-first-century power policy goals focus on resilience--the capacity to withstand cyber-threats and extreme weather events; on environmental safety--including effects on climate, water, and air; and economic factors such as affordability and competitiveness.
The U.S. Electric Transmission Grid
The grid spans the continent, is integrated with Canada, and shares a reliability system that spans from Canada into Mexico. The grid is complex, integrating 3,000 utilities and 17,000 generating units, but it rapidly becoming even more intricate, Mr. Bassett said. Today, power plants are networked, transmission lines can be monitored to prevent blackouts, and new technologies offer new energy options. The entire grid is more communicative and integrated.
“Industry needs reliable, high-quality power all the time,” Mr. Bassett pointed out, and States are in the position to ensure a balanced energy supply. “There are many ways to meet your policy goals of clean, reliable, affordable energy,” Mr. Bassett noted. Energy options include natural gas, wind resources, geothermal, and solar, and new options to move and store energy as well. The cost of alternative energy sources is coming down, Mr. Bassett reported. Wind power is now competitive with natural gas. New technologies exploiting solar and wind power have outpaced natural gas development. Alternative energy sources offer the promise of long-term power contracts without fuel costs as opposed to the expense of trucking oil.
Growing Renewable Generation Capacity
The States have been the most important drivers for increasing use of renewable energy sources, Mr. Bassett said. Renewable portfolio policies in the States have supported the development of wind farms and solar energy. The emerging mix of energy sources gives the States more options, he noted. For example, large energy sources in the west need transmission lines, while New York’s needs are different. Minnesota, for example, gets hydroelectric power from Manitoba in Canada, and oil and gas from North Dakota. This flexibility allows States to balance energy in the grid.
Extreme weather events have become more frequent along with flooding that leads to electrical outages. In the August 2016 Louisiana storms and flooding 37,000 households lost power. Cyber-attacks on the grid are becoming more frequent, and the potential for physical attacks on power plants and transmission lines should be considered, Mr. Bassett said. He recommended that additional storage and back-up flywheels can help alleviate such stresses on the system.
Storage is the new energy hot topic of the next decade, Mr. Bassett predicted. “People do not want transmission lines, so storage will become more important.” California, Oregon, and Massachusetts have the best storage plans of the States. Better storage capacity is one way to balance out the intermittent nature of renewable energy, he added.
Storage technologies are evolving, with grid-level batteries that can respond to or prevent blackouts as well as smaller batteries for home energy storage. Huge energy storage options have yet to be exploited such as pumping water from a dam back up to recycle through the turbine a second time. Homeowners want to be off the grid, and new technologies are making this practical.
The energy sector is a significant source of jobs, Mr. Bassett pointed out. Currently, 800,000 people are employed in the energy sector. Solar industries employ 200,000, and wind industries account for 75,000 jobs; both are growing. Investments in renewable-energy industries can create jobs and attract more manufacturing jobs to your state, he observed.
Based on his extensive experience in the energy sector, Mr. Bassett concluded by recommending that legislators meet with their energy regulators and Federal and regional energy agencies such as the Department of Energy and the Environmental Protection Agency. He stressed the value and importance of these relationships for policy-making.
Sen. John Cullerton (IL): To what extent do geography and transportation choices affect air quality?
Mr. Bassett: Geography is a crucial issue. For example, in the Salt Lake bowl, surrounded by mountains, emissions from transportation, homes, and industries are trapped in the bowl. When we relied on coal-fired plants for power 50 years ago, air quality was worse. However, 50% of harmful emissions come from cars and trucks, so transport continues to be an issue.
There are several ways to improve air quality. First, fuel can be cleaner. Federal standards for catalytic converters set tiers for emissions. Tier 2 is 10 times cleaner than Tier 1 and Tier 3 is 10 times cleaner than Tier 2. Second, providing a mix of transport options, including light rail, biking and walking, would cut down on car use. Third, new land-use patterns and design of communities so that people live, shop, work, and play nearby would reduce mobile emissions. In 15 years, such strategies could reduce mobile sources of emissions by 68%.
Ron Orlando (Comcast Cable): We installed 40 solar panels at my home and cut our electric cost from 0.27/kWh to 0.11/kWh. We produce excess electricity, but State regulations prohibit us from storing and using the excess. We use solar during the day and the grid at night.
Mr. Bassett: At the State level, regulators are grappling with the issue of net metering. If a homeowner installs solar panels and sells electricity back to the grid, the utilities have to pay the homeowner. This is cross-subsidization, where one person pays less and another pays more. Regulators are struggling with how to quantify the benefits of clean energy in terms of reduced air and water pollution and reduced carbon emissions. They have to account for these benefits when billing users. As technologies advance, homes may become a closed, self-contained microgrid.
Sen. Sandy Pappas (MN): Funding sources for alternative energy seem limited. How can States pay for new technologies?
Mr. Gruber: There are new Federal sources of funding, especially for new start-ups. In Utah, local voters have approved local-option sales taxes to be reinvested in infrastructure. Maintenance costs are being funded from a mix of sources, including a gas tax and sales taxes.
Mr. Grow: The visioning effort we engaged in developed trust locally and federally. The Federal funds we received were conscientiously used. We completed projects on time and on budget, and we delivered the ridership we promised. This was a demonstration that supported our ability to get local funding approved.
Sen. J. Stuart Adams (UT): Utah has 3 sources of taxes: property taxes that fund schools, income taxes that support education, and a general-fund sales tax. The general fund allocated 0% to transport in 1990, but 17% in 2016. The sales tax is cyclical. In a down cycle, we can reduce the transport investment and put the money into a rainy-day fund.
Sen. Troy Fraser (TX): Fifty percent of pollution comes from vehicles, and, in the heat of the day, from electrical generation for lighting and air conditioning. Because of noncompliance with air-quality standards, Texas was losing Federal funds. We imposed a fee on diesel to make up the difference, and we want to put money into storage technologies to balance out our electrical supply. But we want to do this without huge subsidies.
Mr. Bassett: Storage technologies are expensive, and you need the ability to meet emergency needs for power. Pump storage of hydropower is a less expensive, older, and proven technology. But you have to consider the water supply.
Sen. Kevin Meyer (AK): We have been working hard to heat remote areas and get them away from using diesel generators. Now we are moving to wind, hydro, and geothermal sources. But Alaska is an oil-producing state. We are considering making a $50- to $60-billion investment in a new gas pipeline. Should we expect increased utility costs because of storage requirements?
Mr. Bassett: In some regions, it doesn’t make sense to build out solar voltaics. There are fuels such as natural gas that are better and cheaper in some regions. However, thinking long-term, the problem is carbon emissions. To maintain a livable climate, we will need new, cheaper technologies, for example, carbon capture technologies. Another alternative is to look for energy efficiencies. You can implement policies to incentivize energy savings such as building codes requiring insulation or requiring HVAC installations to be more efficient.
George Cook (Toyota): Car companies are working on advanced technologies for fuel efficiency. When you do planning, do you take into account autonomous vehicles? What do you think about the viability of hydrogen and hydrogen fuel cells?
Mr. Gruber: We definitely consider the impact of new technologies on infrastructure. We anticipate that technological advances will reduce the demands on infrastructure. Driverless cars, connected vehicles, and communicating cars will allow vehicles to travel closer together. Lane widths can be tighter, and we will invest less in infrastructure. On the other hand, today older people stop driving. If the car will now drive them, that could lead to more demand for driving and more infrastructure.
Mr. Grow: Given its growth, Salt Lake could end up with a 2-mile-wide corridor carrying 24 lanes of traffic. We need better solutions. The air quality in the Salt Lake bowl means that we need Tier 3 cars now. We need those cars in the showrooms today to foster personal choice. The Federal effort is a 10-year plan to get to Tier 3 cars, but we need them now.
Mr. Bassett: Let’s consider the roles for hydrogen power and hydrogen fuel cells. Currently, hydrogen does not have the infrastructure. It lacks safety measures and transport capabilities; furthermore, it is energy-intensive to produce it. However, hydrogen could be useful in places where it is hard to transmit electricity or in long-haul trucking.
Mr. Gruber: The approach on fueling infrastructure will be a mix of all options. There is no one-size-fits-all solution for energy or for mobility. Dense urban areas will require transport alternatives. On the State level, we have to protect and maintain our infrastructure with a mix of energy, transport, and reinvestment in infrastructure. This is essential to maintain our global competitive advantage.
Robert Grow holds degrees in engineering and law from the University of Utah and the J. Reuben Clark Law School at Brigham Young University and has had a diverse career, including practicing law, leading and supporting regional visioning processes, being president of a large manufacturing company, and chairing a national trade association. He was the primary architect of Envision Utah's grass roots, bottom up, stakeholder driven, values based approach. For his role in helping shape the strategy for the Salt Lake region's future transportation system, Robert received the American Public Transportation Association's (APTA) Distinguished Service Award in October 2003.
Over the last couple decades, Grow has developed an expertise in facilitating regional stakeholders in creating multi-generational visions for major metropolitan areas of the United States and has worked with more than 80 metropolitan regions. Robert led the visioning teams for San Diego; Laie, Hawaii; and the 175,000-acre Superstition Vistas property in Arizona and played a significant role in the Traverse City, Michigan and Southern Louisiana visioning processes. In addition, he led the Utah-based team of O'Melveny & Myers LLP dealing with the full spectrum of legal issues relating to environment, planning, entitlement, infrastructure, and development for Kennecott Land Company's 93,000-acre land holding on Salt Lake's West Bench plan, as well as the 4,000-acre Daybreak Community, Kennecott Land's first model sustainable community.
Andrew Gruber has served as the Executive Director for the Wasatch Front Regional Council (WFRC) since 2010. He also served as general counsel and director of government affairs for the Regional Transportation Authority from 2004 to 2010 and was an attorney with Mayer Brown from 1999 to 2004.
During his leadership with WFRC, the agency was named Bicycle Friendly Business, received a highly-competitive grant from Utah Transportation Agency along with the Mountainland Assoc. of Governments, hosted annual Consortium Meetings bringing over 100 public and private sector entities together to collaborate on the implementation of their regional vision, Wasatch Choice for 2040. Gruber holds a Bachelor’s degree from University of Wisconsin-Madison and a Doctor of Law degree from Northwestern University School of Law.
Luke H. Bassett is the Associate Director of Domestic Energy Policy at American Progress, where he works on U.S. climate and energy policy, including renewable energy and energy efficiency policies. He previously served as an appointee at the U.S. Department of Energy, or DOE, in the Office of Energy Policy and Systems Analysis and the Office of Energy Efficiency and Renewable Energy. While at DOE, Bassett wrote the North America chapter of the first Quadrennial Energy Review and led development and implementation of several mitigation policies under President Barack Obama’s Climate Action Plan.
Bassett has master’s degrees in environmental management and ethics from the Yale School of Forestry and Environmental Studies and Yale Divinity School, where he focused on climate change and environmental ethics.
Utahns want a future that is safe, secure, and resilient; neighborly, fair, and caring; prosperous; and, healthy, beautiful, and clean.
“People should have a choice about what kind of community they live in. But modeling shows that if we design our land uses right in key places, it makes a big difference.”
A well-functioning transportation system improves the flow of goods and services through the area, attracts businesses, and enhances quality of life, which is important in attracting a talented workforce.
The community must have trust and confidence that its needs have been carefully assessed and the most effective approaches and solutions have been identified.
An economic analysis commissioned by the Salt Lake Chamber of Commerce in 2012 found that investing in the 2011-2040 Unified Plan would nearly double the return on investment for every dollar spent.
The study found that funding the Unified Plan will result in nearly 183,000 new jobs in Utah’s economy in 2040.
The States have been the most important drivers for increasing use of renewable energy sources, Mr. Bassett said.
Better storage capacity is
one way to balance out the intermittent nature of renewable energy.
Sen. David Shafer (GA)
The grid is complex, integrating 3,000 utilities and 17,000 generating units, but it rapidly becoming even more intricate.
Sen. Sandy Pappas (MN)
Sen. John Cullerton (IL)
Sen. J. Stuart Adams (UT)
Sen. Troy Fraser (TX)
Sen. Kevin Meyer (AK)
President & CEO
Wasatch Front Regional Council
Associate Director of
Domestic Energy Policy
Center for American Progress
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