Ty Schuiling; Director of Policy and Planning, San Bernardino Associated Governments

2. INTERRELATED CHALLENGES:
- Growth and Congestion
- Freight Movement
- Air Quality & Environment
- Energy, Fuels, and Prices
- Transportation Finance
- Economics and Institutions
San Bernardino Associated Governments
Ty Schuiling, Director of Planning & Programming
May 14, 2010

3. SCAG Region…forecast growth like adding the
cities of Chicago and Houston in the next 25 years
SCAG Region 2035 Forecast
Population & Employment Growth
(Millions)
2008 2035 Increase
Population 18.6 23.8 28 %
Employment 7.8 9.9 27%
3
3

4. Who will they be??
SCAG Region Population Growth 2005-2025
More Diverse…
4
3.7
3
2
(Millions)
0.6
Older…
1
0.2 3
2.4
0
(Millions)
-0.5 2
-1
NH White Black Asian Hispanic 0.8
1
0.4 0.5
0
0-14 15-34 35-54 55+
Demographic data and analysis provided
courtesy Frank Wen, SCAG

5. Added households will be much older!
SCAG Region Households Growth Age 2005-2025
1.5
1.2
(M n )
illio s
1
0.5
0.2 0.1
0
15-34 35-54 55+
Demographic data and analysis provided courtesy Frank Wen, SCAG
And household composition is changing:
Household Type 1960 2005 2040
HH with Children 48% 32% 26%
HH without Children 52% 68% 74%
Single/Other HH 13% 31% 34%
Source: Arthur C. Nelson, Presidential Professor & Director of Metropolitan Research, University of Utah

6. Huge Shift in Age of Population:
From wage-earners to retirees
Income Earners & Taxpayers
1975 -
Under 20 21-64 65+
2000
27.5% 61.4% 11.1%
2000 -
2025 Under 20 21-64 65+
31.4% 38.9% 29.7%
Demographic data and analysis provided courtesy Frank Wen, SCAG

7. y y
1,400,000 Growth in 65+ cohort,
1,300,000
1970 - 2040
1,200,000
1,100,000
1,000,000
SCA Region
G California Demographic data and analysis
900,000
provided courtesy Frank Wen, SCAG
800,000
700,000
600,000
500,000
400,000
300,000
200,000 Personal Income Taxes Paid
100,000
By Californians – by age
0
40%
70-75 75-80 80-85 85-90 90-95 95-00 00-05 05-10 10-15 15-20 20-25 25-30 30-35 35-40 $2,000
% of California
33.8% Population
35% $1,800
% of California
28.9% PIT
30% 27.5% $1,600
25.7% Average Tax
We are here 25%
22.0%
Paid
$1,400
19.6%
20% $1,200
15% $1,000
11.7%12.3% 12.3%
10% $800
Source: California State Controller 6.2%
5% $600
0% $400
25-34 35-44 45-54 55-64 65 & Above

8. Average households by age group:
$65,000
$58,889
$60,000
$56,500
$55,000
$50,000
$45,000
$44,649 $45,498
$48,108
Incomes
$40,000
$35,000
$29,349
$30,000
$25,220
$25,000
$19,744 $20,563
$20,000
$15,000
$10,000
All Under 25 25-34 35-44 45-54 55-64 65 and 65-74 75 and
Over $50,000 Over
$46,160
$45,149
$45,000
$38,945 $39,340
$40,000 $38,045
$35,000
$30,782
$30,000
$26,533
Expenditures $25,000
$20,000
$22,543 $21,908
(think sales tax) $15,000
$10,000
$5,000
Source: 2000 Consumer Expenditure Survey $0
All Under 25 25-34 35-44 45-54 55-64 65 and 65-74 75 and
Over Over

9. $18,000
Average Government Service Expenses by age
$16,000
Health
$14,000 Care
$12,000
$10,000 Social
Public
$8,000 Education Security
$6,000
$4,000
$2,000
$0
0‐19 20‐34 35‐44 45‐54 55‐64 65‐74 75‐84 85 and
Other Retirement All Other Public Transfers Above
D r iv e r F a ta lity R a te s , 1 9 9 6
(P e r 1 0 0 M illio n V M T )
12
M a le D riv e rs F e m a le D riv e rs A ll D riv e rs
10
Planning for 8
an aging 6
population 4
2
0
16 -
17
18
19
20-24
25-29
30-34
35-39
40-44
45-49
50-54
55-59
60-64
65-69
70-74
75-79
80-84
85 +
Total

10. Indications from the demography:
• Reduction in per capita income tax and sales tax revenues
(principal sources of state, local, transportation funding)
• Increasing demand for government services
• Increased demand for small lot detached and attached
residences, but a surplus of large-lot (7,000 sq ft+) homes
• Increasing need for safer alternatives to the auto for our
aging population

11. Transportation…
Source: California Travels – Legislative Analyst, 2007

12. State gasoline tax
has not kept pace
with travel
System capacity has not
kept pace with growth

13. Freight:
We’re No. 1!
Source: US Department of Transportation
Estimated Trade Value
by Congressional
District
13

14. Containers at West Coast Ports
TEUs in (millions)
Port of Oakland Local
LA-Long Beach
Ports
Out-of-
region
0 5 10 15
Share, west coast ports
14

15. New San Pedro Bay
Forecast:
More intact movement of goods via the Panama Canal.
Development of multiple import supply chains using ports on all
three coasts.
Growth in trade with regions such as Europe and Latin America
that favor the East or Gulf Coast ports.
Increased competition from West Coast ports
Should Consider:
• Transport cost increases related to fuel price
• Narrowing of labor cost disparities

16. Modal Market Segments (MCGMAP)

17. The Transloading Advantage
Transloading of weekly shipments from Asia
affords large retailers an 18-20% reduction in
their total pipeline plus safety stock inventory
compared to direct shipping.
Regional &
Regional &
National DCs
National DCs
1 billion sq ft of
warehouses today
Where will the next ½
billion sq. ft. go? Cross-dock
Cross-dock
Transloader
Transloader
s
s

18. The Port and Modal Elasticity Study found:
1. Inadequate landside freight capacity will strangle port
growth absent major improvements
2. Failure to address landside congestion will cause
diversion/loss of market share, and loss of logistics jobs
3. Phase II analysis suggests imposition of local fees will
cause diversion
Source: Gill V. Hicks
Year Train Type Average Delay
BNSF Freight 206.3 minutes
2016?
UP Freight 196.9 minutes

19. Community Impacts of Freight:
Grade crossing delay and noise Carcinogenic air toxics
Rest of Nation
48% Extreme PM2.5 Exposure
South Coast Air Basin
52%

20. CARB Assessment
of PM Health Effects
SCAB Cases/Year due to PM2.5 *
Premature Deaths 5,400
Hospitalizations 2,400
Asthma & Lower Respiratory 140,000
Symptoms
Lost Work Days 980,000
Minor Restricted Activity Days 5,000,000
•1999-2000 Air Quality Data
Source: California Air Resources Board

21. We are not on trajectory for timely attainment of
federal AQ standards (ozone and PM2.5)

22. NOx pollution in Southern California and San Joaquin Valley
also contributes to:
• Increased invasive plant
density and production
• Increased fuel load
Exceedence of critical • Increased threat of fire
loads of nitrogen frequency and intensity
deposition in red, where • Loss of habitat for native
negative impacts to
ecosystems occur due
species
to excess N inputs • Groundwater nitrate
pollution
Invasive grasses
carry fire
Data and graphic courtesy Dr. MichaelRiverside
University of California, Allen, Professor and Chair, Plant
Pathology and Microbiology, University of California, Riverside

23. What must be done to achieve those further NOx reductions?

24. Attain federal standards with ship and airplane emissions?

25. Need for Zero/Near Zero Emission Technologies
• Plans to date include insufficient measures to actually
attain federal clean air standards
• Even full fleet turnover to 2010 truck standards and to the
Tier 4 locomotive standards proposed by USEPA (per the
RTP) will not provide sufficient reductions
• This air basin must achieve zero and near-zero emission
vehicle penetration far beyond levels assumed in ARB’s
EMFAC model (which is also used for SB375 GHG
calculations) to attain federal health standards.

26. Do we attack the air quality problem in
effective ways?
SB 375 – 3-5% (?) reduction in GHG from
changed land use patterns, new urban
design, and enhanced transit

27. % VMT Reduction by Individual Measures, 10 yr, 20 yr, 30 yr, 40 yr
From Rodier (2008), UC Berkeley for the 2009 TRB
But is our approach to air quality effective? SB 375 calls for a 3-5% (?) reduction
in GHG from changed land use patterns and enhanced transit

28. “So now we know: The price point is $4. At $3 a
gallon, Americans just grin and bear it, suck it up,
and, while complaining profusely, keep driving like
crazy. At $4, it is a world transformed. Americans
become rational creatures. Mass transit ridership is at
a 50-year high. Driving is down 4 percent…
Hybrids and compacts are flying off the lots. SUV
sales are in free fall.”
CHARLES KRAUTHAMMER, Pulitzer Prize-winning
syndicated columnist, June 7, 2008

29. "Right now we have enough information
to officially call it a trend," said Federal
Highway Administration spokesman
Doug Hecox. According to the survey,
drivers started staying off the roads in
droves last November. In March, the
miles driven on U.S. highways fell 4.3%
from March 2007.
Steve Chawkins and Martin Zimmerman, Los Angeles Times Staff
Writers, May 24, 2008
SB375 – 3-5% VMT reduction in 10 years?

30. Technology?
2004 Chevrolet Percent
2004 Toyota Prius Savings
Malibu Reduction
EPA Emission Standard Tier 2 Bin 8 SULEV II
Non-Methane Organic Gases (grams) 2 1,527 122 1,405 92%
Carbon Monoxide (grams) 2 51,303 12,215 39,088 76%
Nitrogen Oxides (grams)2 2,443 244 2,199 90%
Particulate Matter (grams)2 244 122 122 50%
Carbon Dioxide (lbs)3 10,470 5,330 5,140 49%
EPA Fuel Economy (city/hwy)4 24/34 60/51
EPA Fuel Economy (combined)5 28 55 27
Fuel Consumed Annually (gallons) 436 222 214 49%
Notes
1. Based on 12,215 annual mileage.
2. Data obtained from Smog Forming Pollutants Chart, EPA Green Vehicle Guide: www.epa.gov/autoemissions/0-10chart.htm
3. Calculated using (12,215 miles / Combined MPG) x (24 pounds CO2/gallon). Includes upstream CO2 emissions and end-user CO2
emissions. David Friedman, Senior Engineer, Union of Concerned Scientists. Personal communication 7/25/2003.
4. Fuel economy rating for automatic/continuously variable transmission.
5. Assumes 55% city driving and 45% highway driving.
Emission Standard Key: Vehicles meeting the Federal Tier 2 Bin 8 standard produce: 4.2 g/mi of CO, 0.02 g/mi of particulate matter, 0.2 g/mi
of NOx, and 0.125 g/mi of non-methane organic gases. Vehicles meeting California’s SULEV II (Super Ultra Low Emissions Vehicle) standard
produce: 1 0 g/mi of CO 0 01 g/mi of particulate matter 0 02 g/mi of NOx and 0 01 g/mi of non methane organic gases

31. AIR QUALITY STRATEGIES
for transportation sources
More
effective Clean technologies (EVs, plug-in hybrids): 90%+ reductions in
emissions per vehicle
Pricing (increased gas tax, VMT fees, congestion pricing):
10%+ reductions in VMT in < 5 years
Land use change: possibly 4% in VMT over 20 years (per
Rodier)
Transit: 3%(?) in VMT over 20 years (per Rodier)
Infrastructure investment: little, but critical for mobility
Less Note: Less effective strategies (e.g. land use and transit) can be more
effective effective if combined with pricing and clean technologies

32. ENERGY – an Economy Powered by Fossil Fuels
Mathematical relations involved in the complete cycle
of production of any exhaustible resource
from Hubbert, M. King (1956), Pub. No. 95,
Shell Development Co. Exploration and Production Research Division

33. Upstream cost of oil production
Our energy
outlook:
petroleum
Source: New York Times (2007) from US Energy Administration

34. Hubbert linearization of world production
Source: The Oil Drum, Discussions About Energy and Our Future at
http://www.theoildrum.com/ story/2006/1/20/193723/259

35. Chevron advertisements, 2005 & 2006

36. Oil producing countries past peak production, 2007

37. Oil production from the Majors, 1997 to 2007
Compilation by Energy Watch Group 2007

40. Research to Overcome the Energy Challenge?
Graph courtesy of Kei Koizumi, White House Office of Science and Technology Policy

41. Energy Efficiency
Energy produced (kinetic) per
energy input (chemical or electrical)
Upper efficiency limits of various technologies:
Steam/external combustion: 10% single expansion, 25% multiple
Gasoline (internal combustion): 37%
Diesel (internal combustion): 50%+
Electric: 80 – 90%+, higher horsepowers more efficient
Electric generation: 50%+ simple, 90% with cogeneration
Various sources

42. U.S. Fuel Economy for New Light-Duty Vehicles
1975–2004 Model Years Sales-Weighted Horsepower and MPG
230 59 percent more energy performance
2004
210 2003
2002
2001
190
Horsepower
2000
1999
1998
170 52 percent
1997 1996
1995
more output 1994 1993
150 1975 1977 1992
1991
1978 1990
1989
130 1976
1979
1985
1988
1987
1980 1984
1986
110 1983
1982
1981
0
0 12 14 16 18 20 22 24
Miles per Gallon
Sources: Environmental Protection Agency; Energy Information Administration

43. International Fuel Economy Comparison
Comparison of fleet average fuel economy and GHG emission
standards for new-sale light-duty vehicles
Source: UC Berkeley

44. Mary Peters Secretary of Transportation — Chairperson
Jack Schenendorf Of Counsel, Covington & Burling — Vice Chair
Frank Busalacchi Wisconsin Secretary of Transportation
Maria Cino Deputy Secretary of Transportation
Rick Geddes Director of Undergraduate Studies, Cornell University
Steve Heminger Executive Director, Metropolitan Transportation Commission
Frank McArdle General Contractors Association of New York
Steve Odland Chairman and CEO, Office Depot
Patrick Quinn Chairman, American Trucking Association
Matt Rose CEO, Burlington Northern Santa Fe Railroad
Tom Skancke CEO, The Skancke Company
Paul Weyrich Chairman and CEO, Free Congress Foundation

45. Findings of the Federal 1909 Commission
250
• Public trans spending <$100B Constant 2005 Dollars (in Billions)
200
• Should be spending $225B
to meet long-term needs 150
• Federal share should be
100
historic 40% (currently 17%
of $225B)
50
• But failure to maintain fee-for-
use financing (eg. gas tax) will
0
increase cost to improve to
>$300B Current Spending Cost to Maintain Cost to Improve
(2006) (2055) (2055)

46. What is this information in combination telling us, and
how can it best be used to craft public policy?
Freight
Movement Air Quality
(PM, Air Toxics,
Ozone)
Transportation
(Moving People) Climate
Change
Energy
Water
(Supply/Quality)
Land Use
(Urban Form)
Jobs/
Economy
Housing
Education

47. TAKEAWAYS:
Demography:
Reduction in average per capita income tax and sales tax revenues, increasing demand for services
Smaller labor force supporting large aging and very young populations
Need for safer transport alternatives for the aging population
Increased demand for small lot detached and attached residences, little demand for new large lot
Energy:
Petroleum production may be 60% of today’s by 2040, natural gas will decline more slowly
Significant near-term reductions in EROI from limitations on fossil fuel production
Need intense focus on development of energy alternatives
Near-term need for energy-efficient (not just fuel efficient) technologies to reduce demand
Trend toward compaction of non-residential uses driven by increasing transport costs
Transport: (people and goods)
5 million more people to move, yet most (90%+) of our ‘future’ infrastructure is here today
Still expecting a doubling of freight in 20 years, need dedicated clean technology freight corridors
Need to maximize utility of existing infrastructure

48. TAKEAWAYS #2
Air Quality:
Reductions from transport sector are key, attainment requires zero/near zero technologies,
all modes, in 1-2 decades
Fuel tax increases would help incentivize transformation
Transparency essential, no more “black boxes”
Greenhouse Gases:
Technologic transformation needed for clean air is also most direct path to reduce GHG’s
Gas tax increase and pricing measures would provide far most significant near- term result
Demographic factors and energy constraints will drive land use compaction consistent with SB375.
Transportation Finance:
Need to double annual nationwide transportation investment if only to operate and preserve system
Need to more than triple investment if fee-for-use not re-established
Gas tax increase the most obvious and technically easy first step. Would: pay to preserve , operate,
improve system; reduce demand (VMT reduction = GHG & pollutant reduction); incentivize fuel
efficiency and fleet transformation; promote energy independence; continue to be a viable revenue
source for 10-20 years
VMT fee or similar revenue source needed within 10 years, container fees needed to fund freight

49. Are our plans aligned with
these factors?
The good news:
Responses to the various challenges are
remarkably synergistic