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Stalled Freight Costs Big Bucks

by Lisa Baker
Portland Tribune, December 21, 2004

Local businesses search for solutions as congestion throws schedules into chaos

It’s like a great pair of Manolo Blahnik high heels. Stylish. Cultured. Talked about.

But if you had to run — really sprint — to make it somewhere on time, you’d want something more utilitarian. Like sneakers.

Portland, while listed among the most livable, cultured cities in the nation, also is ranked among the worst for traffic congestion.

In the vernacular: Sure, it looks good, but can it move?

And businesses notice. Bill MacKenzie, a spokesman for Intel Corp., says success for a high-tech company means speed and precision — not just in the development of its products, but in their delivery.

“We operate on precise time frames — high-tech companies more than others,” he says. “Any deviation from schedules has a cost associated with it.”

Alongside commuters fuming at the inconvenience of the vehicle heap at Delta Park or any of the other chokeholds in the Portland metro area, trucks containing tons of freight are idling, too. And each minute, businesses say, they’re pouring another bucket of cash out the window.

The timing issue is so crucial that Intel has poured its own cash into adding wiggle room to the corset that is U.S. Highway 26 and to the squeeze play that is Oregon Highway 217. The company donated $500,000 for the Oregon Department of Transportation’s Highway 26 onramp project.

Even so, improvements statewide have not kept up with demand, and delay time has increased to 41 hours per year per driver, just five hours fewer than Seattle, according to this year’s national study by the Texas Transportation Institute at Texas A&M University. The institute ranks the Portland area the 14th worst for congestion out of 85 urban areas — an improvement on last year, when the region ranked eighth.

Susie Lahsene, manager of land use and transportation policy for the Port of Portland, says road delays have a real cost: “One minute spent idling in traffic costs $1 in wasted fuel and lost productivity. And that’s conservative.”

She says the 10,000 trucks on the Interstate 5 trade corridor at any given time experience delays that constitute a loss of $26 million worth of productivity annually, and more than a half-billion dollars over 20 years, a figure that doesn’t count the additional trucks needed to compensate for lost time.

The need to move freight has become more critical in the global marketplace, where successful companies are those with efficient supply lines that are able to reach the customer with speed and ease, Lahsene says.

No empathy for industry
The problem is, most Portlanders don’t see why they should care about the problems of industry, and if they don’t care, neither do policymakers, Lahsene says.

“Policymakers are responsive to their constituents, and freight doesn’t vote.”

Instead, she says, decision-makers have focused on passenger needs, neglecting freight concerns. “Getting the attention of policymakers for this issue has been a challenge,” she says.

Lahsene believes the key is to make Oregonians care so that their representatives will swing into action: “I think if people understood the economic relationship between industry and the consumer, it would help. We need to make it clearer to them.”

Area businesses are working on that message.

Ann Gardner, development project manager for Portland’s Schnitzer Investment Corp., says, “Freight is a much bigger part of the economy than people thought it would be. In the ’90s, when we did the 2040 growth management plan, there was this idea that manufacturing was dead, that this is the information age.”

Instead, she says, Oregon’s participation in global trade has increased demand for moving products.

And, Gardner says, the economy is vital to future livability because only a productive economy can kick out the tax dollars needed to support education, the arts and parks.

Bob Russell, president of the Oregon Trucking Association, says the traffic situation will get worse if an “aggressive” solution isn’t found.

“During (former Gov. John) Kitzhaber’s administration, there was virtually no expansion of our highway system — that was his policy. Now we’re very concerned because within 15 years, (ODOT) is predicting that freight volumes will double, and currently, 76 percent of all the tons of freight are transported by truck.”

Schnitzer Steel also is concerned because it’s “completely dependent” on the quality of area roads to get raw materials where they need to go, Gardner says.

The problem also has made it harder to sell Portland real estate, the port’s Lahsene says. “In looking at sites, congestion on I-5 has been an issue for some businesses looking at properties we own.”

But both Lahsene and Gardner see reasons to be optimistic: The city of Portland has created the Freight Advisory Committee (the state has one as well), and a massive road improvement bill — $2.9 billion — from the last legislative session is making itself felt, strengthening and repairing bridges to the tune of $2.8 million in 2003, preventing massive restrictions in freight loads. At the same time, Lahsene says, “We’re definitely in a situation of playing catch-up.”

In the past five years, the state has built only 95 lane-miles of new roadway statewide despite increases in population and development, instead devoting most of its budget to maintenance and repair work. In 2003, ODOT repaved 1,537 lane-miles, including 155 miles in the Portland metro area.

Keeping up with Joneses
The reason for emphasizing maintenance over new construction, says ODOT spokesman Douglas McGowan, is two-pronged: First, the cost of land has shot skyward, making every project much more expensive than it was back in the 1950s, when the interstate system was developed.

Second, there are political sensitivities to adding capacity. “It’s because we’ve seen that adding capacity tends to also add elements that fill up that capacity,” McGowan says. “You build it, and they come and congest it.”

Not that Oregon’s policies don’t have economic development in mind. McGowan says ODOT has shifted internal design and construction work to outside firms, a move that’s expected to provide more private-sector jobs.

And there have been other moves to free up road space, such as metered ramps to improve traffic flow and cameras to monitor freeways so that accidents are cleared more quickly. Portland has been focusing on light rail, which, along with other public transit options, diverts traffic from the roadways.

Tom Kloster, transportation planning manager for the Metro Council, says Portlanders shouldn’t be chagrined at the congestion problem because all major cities have it and “we are not increasing our congestion as fast as other parts of the country.”

But John Charles of the conservative Cascade Policy Institute think tank says Oregon’s road situation is the result of neglect, pure and simple.

“You look at Highway 26 and Highway 217 — it’s scandalous that those facilities were not improved a decade ago,” he says.

Lisa Baker
Stalled Freight Costs Big Bucks
Portland Tribune, December 21, 2004

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