The traffic problem can be fixed

Bobby L. Hickman

March 1, 2008

How much worse does Atlanta's traffic have to get before it impacts the area's growth? It's no longer a future concern, experts say; traffic congestion already is discouraging companies from moving to the area.

"Seven or eight years ago, when we put Atlanta on a recommended short list for corporate relocation, we rarely heard issues," said Dennis Donovan of Wadley Donovan-Gutshaw Consulting, a New Jersey-based site selection and corporate relocation firm. "Now everyone says, ‘Don't they have a lot of traffic there?' We're starting to see Atlanta knocked out of the running at the last minute when companies are adding new cities."

Even more troubling: "There's no way to know how many companies are failing to put Atlanta on their original short list because of traffic gridlock."

Donovan was the featured speaker at a recent Metro Atlanta Chamber of Commerce forum on how traffic problems affect economic development. He said congestion "is already becoming detrimental" to the city's growth. Unless transportation is addressed, "it will keep companies from moving to the area and people from moving to the area."

Sam Williams, chamber president, said, "Traffic is the unintended consequence of our success. We've added more than two million people over the last 20 years. Now, we've got to play catch-up, plus anticipate additional growth for the next 20 years."

Donovan agreed growth "has gotten ahead of infrastructure." Atlanta is the nation's fourth-fastest growing area, but infrastructure spending is among the lowest, he said. "The area has seen 50 percent more travel, but just a 16 percent increase in transportation spending."

Unique attributes

According to Donovan, when corporations look at Atlanta for possible relocation or expansion, they see a number of unique attributes. "First and foremost is a deep talent pool. Human resources is the No. 1 criteria for companies looking to relocate."

Another major factor is that Atlanta already has a global business platform in place: lawyers, financial services experts, logistics providers and other professionals with global experience that can accommodate an international global corporate headquarters. Major airports and seaports; fair taxes; relatively low business costs; higher education; and a favorable business climate also are advantages.

However, Atlanta also faces challenges, he continued, with transportation the "No. 1 growth issue. You're in the top 10 in any measure of traffic congestion."

Aside from corporate relocation, Donovan said, traffic congestion can dent the in-migration of talented workers. It will be difficult to continue drawing skilled employees to Atlanta "if they don't want to live here," he said. Quality of life issues are important to young professionals who avoid areas with long commute times and poor air quality.

A related problem is that traffic congestion truncates the labor pool, discouraging workers outside the Perimeter from driving to jobs in Atlanta. "It's a disadvantage for companies when they can only draw from a portion of the labor pool," Donovan said. "Turnover has probably increased because people find somewhere to work closer to home."

Overall, Donovan said, "The business community and government need to be successful at finding a solution. If you don't, there's going to be more transportation problems and Atlanta is going to suffer."

Solving Atlanta's traffic woes will require a combination of political will and new funding sources. Georgia has the lowest gasoline tax in the United States at 7.5 cents per gallon, according to the non-profit, non-partisan Tax Foundation. Williams noted Georgia has not increased its gas tax since 1971. "We have not had a major investment in our freeways since the Olympics," which saw the introduction of HOV lanes, Georgia Navigator and the HERO program. "We must have massive amounts of capital to get where we are going."

Other cities, similar problems

Two areas tackling similar transportation challenges as metro Atlanta are Charlotte and Dallas. Business leaders in both areas say those cities went beyond state and federal governments to find solutions.

Bob Morgan, president of the Charlotte Chamber of Commerce, says his city's population of 1.6 million is projected to grow to 4.3 million in 20 years. "When we look at Atlanta, we see our own future," he says.

The Charlotte region adopted a comprehensive transit plan that relies on a combination of roads, transit and international air service. Some projects are within Mecklenburg County, while others are in conjunction with adjacent counties. For example, Charlotte citizens passed a half-cent sales tax in 1998 to fund the commuter light rail system, which began operations late last year.

"We can't wait for the state to act; we've got to solve it in our region," Morgan says. North Carolina has $63 billion in unfunded transportation mandates. The state's highway stalemate is a "rural versus urban problem, an East Carolina versus the Piedmont problem," he says. "We don't expect anything to change until we get a new governor in 2009."

Mike Baggett, who chairs the Dallas Chamber of Commerce's Transportation and Infrastructure Committee, says his area faces similar challenges. "The Texas legislature focuses on rural areas. There's not enough [state] money to maintain the roads we have, much less to build new ones. People in Dallas and Houston are tired of sitting in traffic, and they are willing to pay extra to avoid congestion."

Baggett says his area is using public-private partnerships to raise road funds. Dallas leaders are working with private companies to build new toll roads and add toll lanes to existing roads. "We're also bidding out the operation of existing roadways as toll roads," he says. "We recently sold the 50-year rights to an existing tollway for $3.1 billion. That money stays in our four-county area for road improvements."

Dallas also turned to light rail, which was funded by a 1996 local option sales tax. Both Charlotte and Dallas reported significant development followed their rail lines.

Donovan said Atlanta also should model successes in other cities such as Jacksonville, Kansas City and St. Louis. Transportation issues "require a holistic solution; one single mode of transportation alone will not solve it," he said. "The good news is that other areas have dealt with these problems. You need innovations in transportation funding. You're going to have to raise taxes. Georgia can play in the game, but you can't just look at one solution."