Has Anyone Seen The National Freight Strategic Plan?

Submitted in 2015, the USDOT’s draft of a National Freight Strategic Plan invited public comment until April of 2016. Eighty-six comments later, the plan appears, here in early 2019, to have disappeared altogether. As a solemn marking of the third anniversary of the project’s last known activity, we’ll revisit  OTNA staff’s reading and commentary of the Plan. Were we overly critical? In review, we still don’t think so. Truth be told, it was barely a plan at all — really more of a report.

Our Analysis of the Draft National Freight Strategic Plan – 2016

The National Freight Strategic Plan (NFSP) aims to serve as an outline of key issues, but its lack of depth and overall passive orientation will not lead to meaningful progress. Increasing pressures from population growth and environmental degradation compel us to think more systemically and powerfully in advancing transportation’s vital role.

For issues as critical as freight transportation, we need to integrate well-meaning government efforts with intelligent private-sector business perspectives to create not just goals and visions, but action plans and commitments. As a matter of fact, if one were to consider a plan as a living document that includes specific measures, baselines, targets, accountabilities, commitments, and action steps, the National Freight Strategic Plan does not qualify as a “Plan.”

What we have come to accept as a “Plan”, including the NFSP, is more of a report on the past, plus trends and projections, and not a plan. In doing so, we abdicate responsibility for transportation system development to the commercial marketplace that is perfectly capable of creating individual projects, but not efficient systems. The entire NFSP relates to the future of goods movement as a pre-determined fate for which citizens must simply pay the economic, environmental, and social costs that the marketplace doesn’t include, because after all, everyone benefits.

This is not a strategy for national power and it is certainly not an approach that will deliver the urgent 21st-century policy goal of economic activity that supports sustainable growth and a higher quality of community life. OnTrackNorthAmerica is providing leadership on the three key developments that are critical to enhancing the NFSP’s contribution to achieving that goal. The first is to identify the full life-cycle costs and benefits of transportation investments at the individual project and systems’ level via OnTrackNorthAmerica’s Lifecycle Project. The second is to transform transportation reports and projections into Transportation Action Plans. The third is to implement a new innovative method for collective multi-stakeholder thinking, planning, and action, called IntelliConference.

So let’s dive into the NFSP to further illuminate the specific elements which need to be augmented or added.

Page 8, “Strategies to Address Infrastructure Bottlenecks”

The NFSP focuses its strategies here on a constant build out of new infrastructure. What’s missing is a rethinking of the ever-lengthening supply chain and any mention of localizing production and distribution of natural resources and finished goods.

While we continue to enjoy a robust freight system in the United States, we do not have to remain fixed on moving an increasing volume of freight by the same modal share among truck, water, and rail modes. The NFSP needs to commit to determining and implementing an optimal balance and integration among the modes, given their comparative difference in financial, economic, spatial, and environmental costs and benefits.

Page 9, “Identify major trade gateways and multi-modal national freight networks/corridors”

This section continues the unfortunate drive toward focusing public sector support on “Projects of National Significance.” The shortcoming here is that there aren’t projects of national significance without many projects of local significance. When government forgets this fundamental principle of national vitality, we end up with infrastructure systems that are heavy on costs and short on benefits. Major arteries and corridors are important, but shippers and receivers are all part of local communities. Over the past twenty years, funding programs that supported smaller local projects have been allowed to sunset while replacement programs target only the largest projects.

Page 9, “Mitigate impacts of freight projects/movements on communities”

This is where we have to get serious about new forums and methods for allowing communities and businesses to interact efficiently and productively by melding diverse perspectives into smart plans that serve all interests best. We have to transform the unfortunate labeling and denigrating of community input as “NIMBYISM” (Not In My Backyard-ism). Citizens are well in their right to be concerned about transportation expansion, the overall health of the environment, and the quality of community life. Their thinking should be invited and incorporated into development plans.

There is also a glaring need for the NFSP to advance the entire domain of “Freight Transportation Land Use Planning,” which is currently an afterthought in the academic and professional planning world. Perhaps the greatest influence on land use patterns in North America over the last 150 years has been the build-out of our transportation network. Particularly as space has become its own limited natural resource it is time to strengthen our design of infrastructure systems with an understanding of the direct connection between transportation and land use.

Page 10, “Improve coordination between public and private sectors”

The level of public and private sector coordination and collaboration that is now needed to address multifaceted planning and investment challenges requires a new approach to anti-trust throttling of stakeholder engagements. Our anti-trust, competitive framework for commercial activity may have been appropriate in earlier centuries as we were evolving our democratic principles as a society, but now we must make the brave leap to refocus around the untold benefits of trust and collaboration. Competition can only take a society so far as an organizing principle for commerce and governance. We have arrived at the extreme of how far that is.

The NFSP should lead us to begin modeling the new levels of true stakeholder collaboration that will take us productively beyond outdated and insufficient, yet still sacrosanct, anti-trust regulations, and into a 21st century of trust.

Page 10, “Ensure availability of better data and models”

The USDOT’s Freight Fluidity Performance Measures project, as well as the US Department of Commerce’s Advisory Committee on Supply Chain Competitiveness, are both advancing data and modeling approaches that only focus on freight times, reliability, and costs to shippers. In the 21st century, we can only design freight systems as a contribution to society if we embrace transportation’s full lifecycle costs and benefits including the costs of construction, maintenance, and operation as well as the full range of environmental and social costs.

Grounded in this full lifecycle costs and benefits it is then critically important to expand data and modeling beyond individual project analysis to the level of whole systems’ planning.

Page 11, “Use existing grant programs to support freight”

Why would we think that competition for individual project funding is a productive framework for grant programs that need to be deployed effectively to build out whole infrastructure systems? Surely we can raise our level of thinking, analysis, and coordination to base investments on whole system planning, and not solely on competitive agendas of individual project applicants. The energy that goes into the 85% of applicants’ projects that “lose” the competition could instead be directed to the development of public-private transportation system growth plans. Having a coherent, system-level “business-like” plan would attract the private sector to invest its considerable capital resources in infrastructure growth projects.

Continuing this outdated application of competition rather than thoughtful design relegates us to over-spend on transportation systems that suffer from silo thinking, gaps in regional connectivity, and suboptimal modal integration.

Page 15, (Here the NFSP warns of the dangers of rising sea levels and the need to design more resilient and redundant infrastructure at the ports.)

Practically speaking, can we afford to build the port infrastructure to support the continued globalization of the supply chain? Two dynamics are converging that should be causing us to reconsider the ongoing expansion of international freight movement: population is increasing in urban regions around port facilities, and these ports are located in coastal areas that are most vulnerable to sea-level rise and related climate disruption events. It is probably not in our long-term interests to peg our future on moving increasingly larger amounts of freight through urban port cities in which more people are living. Communities, ever more conscious and fearful of environmental degradation, are gaining their power in the marketplace, adding to the challenge of port expansion around the world. It is time to rethink the life-cycle inefficiency of current global logistics trends.

Page 17, “The Plan does not mandate a list of freight projects; instead, it proposes the means by which all of these participants can work together to meet our nation’s long-term economic needs in an effective way.”

The NFSP is yet another report about the need for stakeholders to “work together,” as if talking about collaboration is collaboration. There are no actual collaborative forums or methods initiated by this document. In fact, the best practices of state DOT’s and other planning entities are kept between themselves and their consultants, instead of being shared and scaled up. Again, competitive advantage has been the goal when our shared challenges are calling out for productive, practical collaboration.

Even when existing freight advisory boards appear active, they do not accommodate private-sector participants actually revealing their business models and the degree to which they do or do not align with the best interests of the community.

As a nation facing numerous multi-faceted challenges, and in urgent need of “working together,” we must look squarely at the anti-trust straitjacket we have placed on our industrial activity. In effect, it has resulted in what could be a ruinous level of intellectual stove piping and unending competition for public policy advantage. This ongoing dynamic is insufficient for creating the win-win public policy approaches and investments that are now required to make our communities and businesses sustainable.

Page 23, “Freight will grow across all transportation modes”

Why would the strongest nation in the world relate to freight trends as if they were predestined and that the best we can do is pay to keep up? The NFSP needs to shift its orientation from reactive to proactive. What do we want our freight system to do for us as a nation? How do we want freight to move? How much land do we want to invest in goods movement? In what patterns and relation to other land uses? What environmental and societal impacts do we want to incur in the movement of freight? These and other questions should be the powerful foundation upon which a national transportation investment plan would be established. The NFSP does not answer these questions, and does not even ask, or set in motion the means by which we would address these important design issues.

Page 35, “Underinvestment in the freight transportation system”

Everything about funding in the NFSP is presented as a problem, instead of an opportunity. That is not a recipe for creating powerful, innovative, national approaches to building transportation infrastructure. While it has become popular and sympathetic to bemoan our problems, we must overcome this cultural drift and rethink transportation. Thinking positively can lead us to recreate transportation as a whole-system platform for profitable private-sector investment.

Page 54, “The public and private sectors often have competing priorities”

The NFSP communicates this as if it makes perfect sense and we can live with it. In the 21st century, we can no longer afford the effects of this disastrous agenda gap. Closing this gap is not only a requirement for environmental and community sustainability, but private-sector business success now depends on an alignment with the best interests of the country.

CREATE, the Chicago area aggregation of freight improvement projects is identified as a model of progress rather than a model of the problem. Completing only half of the targeted 70 projects in the 12 years since the program’s inception provides an excellent opportunity to observe and correct the existing barriers to infrastructure development. At this pace, it will take 25% of the 21st century to address the most important center of freight activity in the country. That pace of development is not conducive to our national power and economic vitality. Imagine the health impacts that Chicago’s citizens are suffering as a result of living in the midst of what the CEO of Canadian Pacific Railway recently described as the “leading freight bottleneck in North America.”

Pages 50-60, (This is an excellent coverage of the issues in planning and data modeling.)

Page 64, “Our increasingly urbanized population poses challenges for first- and last-mile freight movements”

The NFSP makes no mention of the continued retreat of the rail network from the urban and exurban landscape. A sensible approach to urban planning must address the need for environmentally- and spatially-efficient rail transportation. The sustainability of economic growth, population growth, and increasing freight demand requires a rethinking of the current drive toward less rail and more truck transportation in the urban design.

Page 73, “Our economy is becoming increasingly reliant on international trade”

What has to be added to this section is a consideration of the financial, environmental, and social costs that we are bearing to subsidize the ongoing growth in international trade and the consequent movement of goods around the world.

Particularly since we do not charge the marketplace anywhere near the actual environmental costs, let alone the construction costs of building out new port and transportation infrastructure, we are continuing to subsidize the lengthening supply chain. Transportation remains an under-priced element of global trade. This has been an unfortunate development in world history with ocean-going shipping producing as much CO2 emissions as the sixth largest country in the world.

Consequently, we are shipping raw materials across the world to be manufactured into finished goods which are then shipped to the rest of the world, including the countries that sourced the raw materials. Our environment, port cities, and oceans cannot bear these inefficiencies for much longer. It is time to refocus economic development on localizing production and consumption. We have to inform the calculus of all long-term plans with an understanding and accounting of the environmental and social costs of transportation and distribution.

P. 76, “II. F. New technologies affecting freight”

Typical analysis of technology developments applies too narrow a “productivity” lens to investment and deployment. We are at a time in world history where objective analysis of productivity must include the full environmental and land use implications of new technologies on the whole transportation and distribution system, and not just on individual development or project-level results.

“Section III: Strategies”

P. 89, “III. A. Strategies to Address Infrastructure Bottlenecks”

The NFSP needs to be informed by the spatial difference between modes. For instance, since it takes 31/2 trucks to move the same amount of goods as one railcar, it takes a 27-mile convoy of trucks on public thoroughfares to move the same amount of goods as a one-mile train operating on its own narrow right-of-way. With space, capacity, congestion, and infrastructure bottlenecks a growing issue, a sensible freight plan for the future has to account for the “spatial” impacts of modal choices.

P.95, “A.5. Mitigate impacts of freight projects/movements on communities”

When the country faced important infrastructure decisions in the 19th century, primarily regarding the comparative advantages of road, rail, or canal, a conscious decision was made to invest in a major rail network build-out. Now, in the 21st century, we have the power to make design decisions with full triple-bottom-line accountability. The NFSP makes no mention of modal preferences, priorities, measures, or impact goals. The extent to which the NFSP mentions “alternative freight modes” is as follows:

“Promote multimodal freight planning and operations strategies that offer important opportunities to improve environmental sustainability and reduce community impacts of freight transportation. In some cases, the use of alternative freight modes can reduce environmental impacts or enable routings that avoid proximity to residences and schools. For example, the America’s Marine Highway Initiative, which seeks to shift container and trailer movements from congested land side corridors to water, can lessen the impact of freight movements on neighborhoods in gateway port cities.“

Unlike energy where “alternative” is known to refer to non-fossil fuel sources, there is currently no agreement on the meaning of “alternative freight modes”.

“Section III. B. Strategies to Address Institutional Bottlenecks”

P. 107, “Incentivize the establishment of State Freight Advisory Committees and the development of State Freight Plans”

The NFSP can only advance the ball if it proactively moves to establish the missing consensus around vision, results, and commitment to action among the involved stakeholders. There is currently no organizing dynamic in the marketplace that somehow alchemizes all the individual activities of the stakeholders into efficient transportation systems.

We have to break down the walls between the public and private sectors, between individual businesses, and between states and regions. Competition as an operating principle works fine for toothpaste and beer, but not for designing and building important infrastructure and social service delivery systems.

P. 108, “B.2. Facilitate multijurisdictional, multimodal collaboration, and solutions”

From the text… “In addition to the above initiatives, U.S. DOT could also pursue the following approaches to further institutionalize a culture of multi-modalism and collaboration: • Codify a multi-modal NFP. Clarify in statutory language that the NFP, freight network, National Freight Strategic Plan and freight performance data – established by MAP-21 as highway-centric – be multi-modal.”

This is a good start, but it continues to ignore that we have no nationally agreed upon set of performance metrics, baselines, and specific goals for what we want transportation to produce for us as a country. We need these elements in place so that state and regional plans can align around results that are in concert with other regions and together add up to national strength and vitality. Systems planning requires this cohesiveness.

Without specific metrics, baselines, and targets at any level of government regarding transportation performance, state freight plans will continue to be vague and ineffective.

P. 112, “B.4. Ensure availability of better data and freight transportation models

Develop and release the FAF version 4 (FAF4)”

Current plans produced by planning agencies are all based on projection data from the Freight Analysis Framework. The FAF has consequently become the predestined future for that state or region. This ongoing pegging of transportation plans to freight trends from the past dooms us to the same gaps, inefficiencies, and costs that have continued to plague the country. Projections based on past data trends are useful only if they inform conscious goal-setting and subsequent investments that bend those trends into the systems and results we want.

P. 117, “III. C. Strategies to Address Financial Bottlenecks”

The NFSP misses all understanding of why the FRA’s Railroad Rehabilitation and Infrastructure Financing (RRIF) program would remain seldom used. There is so much to learn about our country and its infrastructure management from the existence of a $35 billion, low-interest, long-term finance program that accepts collateral that is difficult to borrow against in the private sector, yet has largely been dysfunctional since its inception, deploying less than 10% of its funding in 15 years.

OnTrackNorthAmerica’s Conclusion:

It is instructive that the National Freight Strategic Plan’s final section on “Strategies to Address Financial Bottlenecks”, perhaps the most important factor in the future of freight transportation improvements, would total all of three pages.

This dearth of creativity and commitment is reflective of a limited grasp of the opportunity that can be forwarded by a comprehensive, productive approach to infrastructure financing.

As President Barack Obama said in his State of the Union address, “The United States of America, right now, has the strongest, most durable economy in the world.” A national freight plan for the United States, therefore, should be based on a powerful investment plan with clearly articulated costs, benefits, and outcomes.

In addition to the country’s business managers and investors who oversee ample investment capital, many of the world’s largest investment groups are anxious to invest in North American infrastructure when the environment is made more stable and promising.

Funding from around the world flowed into 19th-century North American transportation before there was a well-established network and ready-at-hand customers. When we recreate the National Freight Strategic Plan as a coherent, compelling growth and investment action plan, all the capital needed to fund that plan will flow in record amounts.