The Mythological Economic Development of Highways

The economic development argument for highways is nothing but funny money. What is spent is real anyway.

Never believe a traffic engineer talking about economic development.  If you’ve learned anything throughout all of this mess, let it be that.

Like all highway projects, part of the justification is always economic development.  Occasionally the rhetoric gets crazy enough to suggest more driving will cleanse the air and the waters of Lake Minnetonka.

On green fields, what we refer to as rural lands or green belts outside the developed city, there is some measure of economic development.  Provided you don’t count the cost of the highway and associated auxiliary infrastructure nor the maintenance.  If you drop a few billion dollars building a new highway into the middle of nowhere there will be some development along it.  You just opened up cheap land, mostly for cheap development.

Unfortunately, the kind of tax base leveraged is what I call ‘net negative.’  In other words, as I discussed the other day, it might take 50 years to pay off a piece of infrastructure with a 30-year lifespan.  Meaning future generations have to pay for the mistakes of the past.  That’s really bad math and even worse utilization of public tax money.  It’s also why millennials and all future foreseeable generations face a less prosperous future than their predecessors for the first time in US history.  Nothing like borrowing against unborn babies.  High five!

You would think NCTCOG was supposed to be the adult in the room.  200 or so municipalities, enamored with Growth!, begging to be the next Frisco, which was the next Plano, which was the next North Dallas, all of which are rapidly and smartly trying to maximize their tax base because they see the light and don’t want to head towards it (if ya catch my drift). If you notice, that favored quarter marched only in one direction.  The center of town has moved out of Dallas to the north, leaving South Dallas behind.  The highways, the prioritization of cut-through traffic over urbanization and neighborhoods within Dallas, maintain and accelerate this inertia of disinvestment, cannibalization, and sprawl (housing and jobs).

Regional transportation planners have shown all too often they will shoe horn and leverage their numbers to continually build highways and saddle the region and the state with increasing debt burden.  We saw it with the Blacklands corridor where 40,000 hypothetical people would bring their chuck e. cheeses to rural land in Collin and Rockwall counties.  We see it with the Trinity Toll Road where more than a million people (apparently) will move into Pleasant Grove in need of a parkway (where we can apparently close down on weekends and have festivals ?!?!) and everything will be grand.

One by one, as arguments in favor of more highway capacity through the core are undermined by facts and reason, the rhetoric inevitably shifts.  Recently, this has come to economic development.  That is, if you take the numbers (and those espousing them) at face value.

It’s only when you look deeper when you find the truth.  Rumor has it the Trinity Tollroad is expected to generate $3 billion in ROI over thirty years.  First of all, that’s not a particularly great return on $1.8 billion road (that cost of course is before adding the tolls and maintenance).  Second, the numbers are bullshit.

The $3 billion comes from two things:  time savings and congestion reduction, which are essentially the exact same thing.  It’s also not even real money.  It’s imaginary.  Can you generate property taxes on time savings?  Furthermore, there is no proof that new highway capacity alleviates congestion or saves time. Just look at the 405 in LA (you know it as ‘carmageddon) where $1.5 billion and 5 years were spent widening it.  Since re-opening travel times have actually gotten a minute slower.  It turns out carmageddon, when the city would shut down the highway entirely over weekends) was actually better for the city as overall vehicular travel demand dropped.

The reality is that new highway capacity through the core only leads to increased per capita VMT (more driving) as jobs and destinations get further and further away, which means more costs onto the private sector, and less tax base in the core.  Increased tax burden with decreased tax base is a terrible equation and the root of urban decline in the late 20th century.

On the other hand, my research suggests that if the investment into the Design District and Trinity Strand Trail area continues at pace (which is occurring due to the proximity of jobs and amenities), could generate $5.6 billion in private investment, bringing 40,000 residents closer to jobs and reducing the burden on Stemmons Corridor.  Helping steer the private market towards infill development and land use balance between housing and jobs is cheap, profitable, and would solve congestion for us.  It’s also tangible economic benefit, all of which would cease if we were to further disconnect and devalue the area with yet another highway.

Don’t let the dinosaurs spend your money.

Or we could continue following the path of Detroit: increasing tax burden (and thus taxes to pay for it) on those remaining, instilling an impulse towards disinvestment, and creating the negative feedback loop and the death spiral of a city.  The choice is yours come May.





  • P Lynch

    Really solid analysis, per usual. Living in Oak Cliff, I hear a lot of grumbling about the development taking place there and along Commerce (which is either Oak Cliff or West Dallas, depending on who you talk to). The concern for many is the development will bring added congestion and traffic to an already congested system. I don’t agree that congestion is yet a concern in the area, but I can see (given the naturally occurring barrier of the Trinity along with the man-made highway noose) how it could become a problem in the future. Part of the answer is improving access to multi-modal transit, but the other part is creating more opportunities for people to work in Oak Cliff/West Dallas, and not just the service industry type jobs that presently dominate the area. How do you see the city’s role in attracting that kind of opportunity in South/West Dallas?

  • Tim

    Good post.