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Tolling Points

What Is ‘Infrastructure’ Anyway?

By: 
Bill Cramer

You’ve heard over and over that America’s infrastructure is deteriorating. And you’ve heard of the infrastructure crisis. But what do we mean by the word ‘infrastructure’ anyway? And why does it matter?

Although it sounds like a simple (and silly) question, how we define the term makes a difference in how we think about infrastructure problems…and what to do about them.

That’s according to Dr. Jonathan Gifford, director of the Center for Transportation Public-Private Partnership Policy at George Mason University’s School of Policy, Government and International Affairs. The Center is conducting a study on alternative funding, financing and pricing approaches to infrastructure, so exploring the definition matters to him.

At the Federal level, “infrastructure” is a very broad term, incorporating many distinct classes of public facilities: Transportation (aviation, rail and roads), mass transit, intermodal transportation water resources, water supply, wastewater management, solid waste and hazardous waste.

Traditionally, our definition of “infrastructure” has been associated with the physical construction and state of the asset, in surface transportation this involves highways and bridges, he said. Literally, it meant the roads themselves. But now we tend to associate a bundle of services along with those roads and bridges. We expect certain safety, reliability and performance levels, for instance. Or we expect real-time information to be delivered to our mobile devices.

Gifford’s research is rooted in basic economic concepts, namely that firms benefit from infrastructure that enables larger geographical supply chain networks, access to larger labor markets and access to specialized manufacturing.

The question of definitions matters because of another economic concept: scarcity. “Where should scarce resources be invested to expand or renew systems? Should we maintain everything?” Gifford asked.  While expanding the scope of the definition adds to the cost of maintaining that structure, it also expands the recognition of dependencies and beneficiaries of that asset (who could/should also contribute to asset). When we think of infrastructure as something more than the physical road, it means acknowledging all of the stakeholders.

Gifford’s study will also evaluate sources of funding, based on whether they generate adequate, sustainable and renewable funds. “Historically, the gas tax isn’t a good proxy for signaling demand. It’s mostly invisible and unrelated to the time and location of usage,” he says. “Tolls do a much better job of signaling demand.”

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