Project Summary Report August 12, 2004

The University of Alabama In Huntsville Office for Economic Development Project Summary Report August 12, 2004 The Role of Infrastructure on Economic Development In Rural Alabama TASK 7: USDOT Grant DDTS59-03-G-00008 Mr. Gregory A. Harris, P.E., Project Manager Prepared by: Karen Stanley KANS Enterprises Consulting (256) 656-9467 kstanley@stanley-hsv.com And Lauren Jennings UAH Office for Economic Development Page 1 of 31 August 12, 2004

The Role of Infrastructure in Bringing Economic Development to Rural Alabama Executive Summary Rural Alabama, and particularly the Black Belt, is an area known for its depressed and distressed economic climate. High unemployment, low family incomes, and slim chances for economic development have plagued these areas for generations. Many studies have been conducted documenting the poverty in the Black Belt, but few have been followed up with investments to alleviate the distress. One aspect of USDOT Grant DDTS59-03-G-00008 called for an analysis of the role of infrastructure in bringing economic development to rural Alabama, with particular emphasis on the Black Belt. Our initial project approach was to use a survey instrument developed by the University of Alabama in Huntsville Office for Economic Development for modeling the impact of predicted increases in manufacturing-related traffic on Alabama highways. The model could be used to predict future highway expansion requirements. The survey asked for information such as current and predicted truck and rail volumes, and asked questions such as what transportation improvements would enhance your business? By utilizing the transportation survey with major manufacturers in Dallas, Perry, Sumter, Hale, Marengo and Greene counties, we planned to describe the role of infrastructure in bringing economic development to the rural areas, particularly the Black Belt. However, after surveying 20 companies and 3 industrial development specialists (Wayne Vardeman, Executive Director, Selma and Dallas Co. Economic Development Authority, Phillis Belcher, Executive Director, Greene County Industrial Development Board, and Jay Shows, President, Demopolis Area Chamber of Commerce & Industrial Development Board) it was clear that transportation issues were not their greatest barriers to company growth or job growth. Industry issues such as replacement products by competitors for the paper industry, or international outsourcing for the textile/apparel industry and workforce development issues were identified as the greatest barriers to economic development. Generally, the transportation needs identified were secondary barriers to business success. The most common response to the question what are your transportation issues was that rural companies have a hard time getting contract haulers to make frequent stops at Black Belt manufacturing locations. Of the companies surveyed, most indicated that their customers were willing to wait on slower delivery schedules that result from infrequent contract hauler schedules. However, if the product delivery requirements were urgent, customers would be willing to pay a shipping premium to entice a truck company to go outside its normal route. The rural companies did not estimate that they lost business due to these scheduling issues, or that improved road conditions would lead to better scheduling. The lack of routing of trucks through rural areas has more to do with the fact that the volumes to be transported are so low that the areas do not warrant more frequent routing, than with the condition of the roads or needs for additional infrastructure. The answer to increasing truck volumes would be to increase current business and attract new business so that contract haulers can make efficient runs. Specific transportation improvement requests from the manufacturers included full four laning of Highway 80, expand I- 85 from Montgomery to state line, improve the Port of Epes, make better use of the Tennessee Tombigbee Waterway. Page 2 of 31 August 12, 2004

Still seeking to identify the transportation related issues affecting economic development in the Black Belt, the project evolved into the following 5 parts: PART I: PART II: PART III: PART IV: PART V: Literature Review of CORRIDOR STUDIES for roads in the Black Belt. Gap Analysis of Economic Development in the Black Belt vs. Economic Development Statewide. Gap analysis between local Black Belt transportation planning and state implementation of projects. Study of corridor development and rural planning methods in Florida and Georgia. Potential for job creation through transportation related industries. CONCLUSIONS: Although the absence of infrastructure presents a barrier to economic development, infrastructure without accompanying workforce development will not yield significant economic development. Policy directives for a state department of transportation seem necessary to elevate attention to rural infrastructure investment. To quote Phillis Belcher of the Greene County Industrial Board, It s the people! This points to an urgent need for training rural citizens for living wage jobs, or potentially jobs that would supplement a farming income, since many of today s small farmers are surviving at subsistence levels. Beyond workforce development, there is the issue of the current condition of public education in the Black Belt. Potential employers have a disincentive to locate in areas where relocating employees would be dissatisfied with the educational offerings. Much adult workforce development could be made more efficient if the adults had a solid early educational background, resulting in improved life skills levels. The complex nature of the many factors affecting economic development indicates that a comprehensive economic development strategy would be much more effective in producing entrepreneurship opportunities and employment opportunities than would a stand-alone infrastructure investment. Thus the role of infrastructure in bringing economic development to rural Alabama is to augment a comprehensive economic development plan, which also includes workforce development. RECOMMENDATIONS FOR ALTERNATIVE APPROACHES: 1. Work with ALDOT to determine the feasibility of a rural transportation planning department. Conduct an organizational assessment to identify how such a department would fit into the existing (or new) structure. 2. Identify the key steps needed to establish a state policy on rural transportation planning, using the Georgia and Florida models. Identify potential champions in the Alabama State Legislature to garner support for a rural initiative. 3. Conduct a feasibility study of a rural intermodal center that would encourage entrepreneurship, job creation, and wealth creation in the Black Belt. Job training for the intermodal center would add the vital element of workforce development to the infrastructure Page 3 of 31 August 12, 2004

investment. Such an intermodal center as a public/private partnership could be an excellent opportunity for federal and state infrastructure investment. Page 4 of 31 August 12, 2004

BACKGROUND What is Rural? Rural areas were formerly considered to be areas with a core population of less than 50,000, while municipalities with populations over 50,000 were considered urban. New Urban Influence Codes developed by the Office of Management and Budget in 2003, classify two types of urban areas urbanized areas and urban clusters. Urbanized areas contain an urban nucleus of 50,000 or more people. The nucleus may be a city, or it may be a grouping of residents in an area with a population density of 1,000 persons per square mile. Urban clusters are territory built up around small towns and cities, and have at least 2,500 but less than 50,000 persons. Rural areas, by the new classification, are all territory outside of urbanized areas and urban clusters. The U.S. rural population was 21% in 2000. 1 According to researchers at Auburn University, 45 of Alabama s 67 counties can be considered rural, that is, the counties which are not classified as Metropolitan Statistical Areas. Thirty percent of Alabama s population is rural. Beyond the Interstate: The Crisis in Rural Alabama identifies several gaps which leave rural Alabama at the bottom of quality of life indicators. Fourteen of 15 counties with double-digit unemployment are rural. Nine of ten counties with the highest population over 65 are rural. Fourteen of 15 counties with the lowest SAT scores are rural. And the rural counties have the lowest median family income. 2 What is the Black Belt? There are several definitions for The Black Belt differing by their bases, for example, on soil characterization, level of poverty, or percentage African-American population. For the purposes of our analysis, we have taken the broadest possible definition of a Black Belt, which covers 19 counties, shown in Figure 1. The 19 counties were identified based on the University of Alabama Institute for rural health research 3 Page 5 of 31 August 12, 2004

FIGURE ONE: 19 Black Belt Counties Page 6 of 31 August 12, 2004

PART I: LITERATURE REVIEW OF CORRIDOR STUDIES The UAH OED project shifted in focus to consider transportation issues from a macro level, along highway corridors, instead of a micro level (company by company). We reviewed the various corridor studies for their suggested projections of economic impact from infrastructure investment. The body of this report includes summaries from AECOM s corridor studies of US 43 between I- 20/59 near Eutaw to I 65 at Mobile, US 80 from MS to GA, the National I-10 Freight Corridor Study, an I-85 corridor study by Auburn University, and a study of I-20/59 by the West Alabama Regional Commission. In our literature review, we found that AECOM Consult, Inc., contracted by DOT, generated a new framework for assessing economic impact of corridors. The impact is defined in terms of jobs, income, and tax base effects and the types of projects are categorized as follows: 1. Better access to employment, production, or distribution centers within a generally rural area. 2. Connectivity and/or circulation improvements to service roads, access roads and relief roads that supplement a major highway through a generally rural area. 3. Connectivity improvements between cities or between a city and a production center through a generally rural area. 4. Better access between a workforce and a production center within a generally urban area. 5. Better connectivity between one production/distribution center and another within a generally urban area. 6. Access/circulation changes to support changing land use in either a rural or urban area. Furthermore, their conclusion to the Highway 43-corridor study reinforces our own opinion that infrastructure development alone will not bring economic development. Quoting their study: Highway improvements appear to be part of an initial step that would allow the region to seek development opportunities that are currently unattainable. These would include development of retirement communities, tourism and low-tech manufacturing yet without highway improvements it is a virtual surety that none of these developments however mundane will occur. 4 For our literature review, each corridor study is reported in a format including key issues and corridor recommendations or conclusions. Page 7 of 31 August 12, 2004

Summaries of Alabama Corridor Studies TITLE: I 20/59 Corridor Study Tuscaloosa to MS 5 DATE: March 2004 PREPARED BY: FUNDED BY: PURPOSE: West AL Regional Commission, AL Tombigbee Regional Commission EDA, WARC, ATRC Assess development capabilities of land in the corridor and assist local governments in efforts to attract industry and create new employment. PRODUCT: Digital base map of corridor Digital map layers for planned highway improvements, traffic counts, existing land use, wetlands, floodplains, slope, water & sewer lines. Baseline background data including demographics. Interviews of local economic development officials to identify opportunities and obstacles. Catalogue existing industrial sites, and identify potential areas of development. ISSUES: Much of corridor segment is undeveloped and lacks infrastructure necessary to support economic development. Lack of metropolitan areas put greater burden on smaller cities and towns for infrastructure improvements. Low population density, low skill levels and low education levels are a challenge to growth. There are several structurally deficient bridges. Nearest ports: Port of Birmingham (Jefferson County) Black Warrior River to Northport (Tuscaloosa county) and Demopolis (Marengo County). Tennessee Tombigbee Waterway ports at Greene County (in Crossroads of America Industrial park) and Port of Epes (Sumter County). Refers to 2 ALDOT corridor studies currently underway for western AL bisecting I20/59, but did not specify as 43 and 80). AREA: 71 miles from I-359 to MS state line. RECOMMENDATIONS: More training for local Industrial Development Boards, i.e. by EDPA, Auburn University. Each local IDB should update its site/building information, and submit to EDPA. All info should be on local, regional and state (EDPA, ADO) websites. Gather info on existing zoning, subdivision regulations, comprehensive plans, strategic plans and other planning related info for the region. Then review hindrances to development. Compile utility information and check for its accuracy. Provide natural gas to industrial parks lacking this service. Market Port of Epes; it is in place and ready for use. Work as a district or region to bring in businesses more than as cities or counties. Upgrade structurally deficient bridges. UAH/OED Author s note: This particular study yields a compilation of resource needs and resources available in the corridor, with next steps recommended to generate a comprehensive economic development regional recruiting plan. Page 8 of 31 August 12, 2004

FIGURE 2: Map of study area for I 20/59 Corridor. Page 9 of 31 August 12, 2004

TITLE: Study of US 43 and US 80 Corridor Potential to Attract New Automotive Suppliers 6 DATE: November 2003 PREPARED BY: FUNDED BY: AECOM Consulting US DOT Federal Highway Administration AREA: 143 miles on US 43 between I-20/59 near Eutaw to I-65 in Mobile. 213 miles on US 80 corridor from MS to GA. Hubs are Demopolis, Selma, Tuskegee, and Phenix City. PURPOSE: Make the region more competitive by providing 4-lane accessibility. Quality of life improvement. Diversify employer base. Attract business investment. Accrue tax base benefits due to higher wage employment. Study access to support changing land use within rural area. PRODUCT: Regression model predicting potential county-level distributions of auto suppliers along US 43 and US 80 with existing 4-lane access. Prediction of expansion of businesses in current clusters (SIC 20-food, 24-lumber and wood, 34-fabricated metal, 35-machinery, 26 paper and allied products, 27-printing/publishing). ISSUES: To date, only 2 auto suppliers have located west of Montgomery in the Black Belt region. Lack of 4-lane and/or interstate highway access is viewed as a primary cause. Secondary factors are declining population and high unemployment. In AL, KY, MS, GA nearly 70% of suppliers are within 10 miles of 4-lane highway, >52% are within 5 miles of a 4 lane. Plants studied: Toyota (KY, est. 1985), DaimlerChrysler (Vance, est. 1993), and Honda (Lincoln, est. 1999). The 65-mile segment of US 43 that is 2 lanes limited the corridor s ability to attract suppliers. CONCLUSIONS: Greene, Marengo, Clarke, Washington, Sumter, Dallas, Lowndes, Macon, Russell counties will not attract auto suppliers with current road situation. With uninterrupted 4-lane connectivity, up to 25 suppliers could be attracted to these counties. Net new auto supplier jobs along 43: 850, Net new auto supplier jobs along 80: 1,675 if uninterrupted 4-lane connectivity were available. Without this access, the region west of I-65 and South of I20/I59 is not expected to attract Hyundai suppliers. UAH OED Author s Note: It is unlikely that 850 trained workers are available in these areas, thus any infrastructure investment should be a part of a comprehensive economic development plan including workforce development. Page 10 of 31 August 12, 2004

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TITLE: US 43 Corridor Between I-20/I59 near Eutaw to I-65 at Mobile DATE: April 2003 PREPARED BY: FUNDED BY: AECOM US DOT Federal Highway Administration PURPOSE: Study Connectivity improvements between cities or between a city and a production area through a generally rural area. Open up 4-lane accessibility to spur interest in developable sites with access to rest of Interstate highway system. PRODUCT: ISSUES: Alabama is distinct from other states that have rural planning offices. No recognized rural transportation planning expertise other than AL DOT. Rural planning done by the planning commissions is utilized by local communities and counties. RECOMMENDATIONS/CONCLUSIONS: Retiree destination market is a prospective source of economic development, but has barriers of transportation and health services. Potential growth is estimated at 4-5% if market limited to AL, but if counties could attract southeastern movers, growth would be 11-12% or if counties could attract retirees from all 50 states growth would be over 23%. Tourism and Low Tech manufacturing are also prospective sources of economic development. The overall results suggest that the region cannot grow without highway improvements that address the lack of four-lane access However, highway improvements alone will not be a panacea for the region. Highway improvements appear to be part of an initial step that would allow the region to seek development opportunities that are currently unattainable. Projected US 43 Distances and Estimated Expressway Costs From To Distance Cost ($ millions) Jobs over 20 yrs. I-20/I-59 Demopolis 30 300 2548 I-20/I-59 Thomasville 74 740 6285 I-20/I-59 Grove Hill 91 910 7729 I-20/I-59 Jackson 106 1060 9003 I-20/I-59 I-65 158 1580 13419 Expressway average total costs assumed to be $10 million per mile, per ALDOT. AL Auto Equivalent Jobs based on $117,745 public incentives per job. Figure Four: Projected US 43 Distances and Estimated Expressway Costs Source: AECOM Report. Page 12 of 31 August 12, 2004

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TITLE: US 80 Corridor Between MS and GA DATE: January 2004 PREPARED BY: FUNDED BY: AECOM US DOT Federal Highway Administration PURPOSE: Study Connectivity improvements between cities or between a city and a production area through a generally rural area. Promote commercial development within major corridor and at both ends. Determine the extent to which the development of U.S. 80 can promote additional commercial development and tourism within the region. PRODUCT: Potential developable sites, interest in existing employers to expand capacity, investment leveraging considerations, tax base effects. ISSUES: Alabama is distinct from other states that have rural planning offices. No recognized rural transportation planning expertise other than AL DOT. Rural planning done by the planning commissions is utilized by local communities and counties. RECOMMENDATIONS/CONCLUSIONS: The expected average increase in sales for existing industry due to improvement and expansion of U.S. 80 is estimated to be 8%, based on a survey of 64 manufacturers in 7 Black Belt counties (plus Montgomery County for continuity). The increase in employment is estimated at 7.7%. 79% of the respondents believed that expansion of U.S. 80 might not result in any future expansion of their current operation. Only the paper and allied products industry survey participants anticipated significant future expansion. Page 14 of 31 August 12, 2004

TITLE: The National I-10 Freight Corridor Study DATE: August 2002 PREPARED BY: FUNDED BY: AREA: Federal Highway Administration, and 8 State DOT s (including AL) Preparers All of I-10 from Florida to California PURPOSE: Assess importance of freight moving on I-10 to the economies of the corridor states and to the rest of the nation. Identify current and future traffic operations and safety problems along the corridor, which impede freight flow. Identify and evaluate strategies, including multimodal strategies, needed to facilitate freight flow within the corridor. LESSONS LEARNED FOR ALABAMA: Freight movements (trucks) are increasing on I-10 much faster than auto volumes 117 percent to 63 percent by 2025. The I-10 Tunnel in Mobile is a major bottleneck and presents a threat to public safety as well as to the vitality of the local, regional and national economy. New auto industries in the Southeast will drastically increase freight movements. Increased highway capacity is recommended for efficient freight movement. Other modes offer only a very limited solution. Roadway improvements that adequately address the freight capacity issue have an extremely high cost. Page 15 of 31 August 12, 2004

TITLE: An Economic Development Strategy for the Alabama I-85 Corridor DATE: PREPARED BY: Office of the Vice President for University Outreach Auburn University FUNDED BY: AREA: I-85, 80 miles from Georgia to Montgomery PURPOSE: Create a comprehensive economic development strategy for the Alabama I-85 Corridor. Assess the development capability of the region and develop plans for best utilization of property within the corridor. Assess the quality of K-12 schools in the region and devise strategies to have worldclass public education within 10 years. Make recommendations for coordinated future development to create 3,000 5000 new high paying jobs over 10 years. PRODUCT: Economic Development Opportunities and Constraints map. Identified 5 categories of criteria crucial to development: 1. Land-based constraints 2. Water-based constraints 3. Suburban/ex-urban development constraints 4. Urban development constraints 5. Cultural constraints RECOMMENDATIONS/CONCLUSIONS/SUGGESTED NEXT STEPS: 1. Additional mapping of size and location of sewer and water lines. Inclusion of wetlands, sinkholes, earthquake fault lines 2. Fine-tune the development siting criteria. Smaller industrial and commercial areas may require different criteria. 3. Economic impact modeling. 4. Assessment of potential new interchanges. 5. Interstate improvements. 6. Documentation of existing utility services and sharing of information. 7. Collaborative land use planning and zoning 8. Planning for growth in existing and potential new communities. 9. Regional transit needs for corridor communities. Page 16 of 31 August 12, 2004

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PART II: GAP ANALYSIS OF THE DIFFERENCE IN ECONOMIC DEVELOPMENT IN BLACK BELT AREAS VS. STATEWIDE Within the group of 45 rural counties, our study focuses on 19 Black Belt Counties. Black Belt County residents make up 8.2% of the population, but account for 11.3% of unemployed Alabamians 7. From 1999-2004, new job announcements in the Black Belt (8.2% of jobs announced statewide) were proportionate to its percentage population. However, Black Belt job growth proportionate to statewide growth will only perpetuate the unemployment gap. The gap will not be bridged without enough special attention to economic development in the Black Belt to accelerate the job creation. 8 JOBS CREATED (1999 5/04) CORPORATE CAPITAL INVESTMT (1999 5/04) Ind. Access Proj TRANSPORT N SPENDING (1995-2004) POPULATION (2000) UNEMPLOYMENT (2000) Black Belt 6,948 $0.83 Billion $18.0 Million 395,322 14,373 Statewide 84,229 $12.4 Billion $107.9 Million 4,447,100 126,911 Percent in Black Belt 8.2% 6.7% 17% 8.2% 11.3% Table 1: Economic Announcements and Transportation Industrial Access Spending Sources: Census Records Alabama Development Office Economic Development Announcements From 1999 May, 2004 Alabama Department of Transportation, Industrial Access Project List 1995-2004 One caveat to this data is that all companies do not announce their expansions, and that given the $12 million annual cap on Industrial Access Projects (IAP), other transportation spending for the benefit of economic development is often shifted from other capital spending plans. When attempting to answer the question does infrastructure investment have a primary impact on rural economic development? one might give the answer no if comparing the number of jobs announced (on record) on the full list of Economic Development Announcements with the number of jobs that can be identified with their companies having been named as a beneficiary of industrial access projects. Figure 3 shows that there were many announcements that did not appear to have any accompanying infrastructure investment. And of the announcements and projects recorded, only 31% of projects were assisted by transportation spending. This is a very rough analysis, however, because many of the IAP projects benefit other companies in addition to the primary ones listed who may have requested the investment. Secondly, some IAP projects list industrial parks, not the several companies that might benefit. To account for this, an effort was made to identify park tenants and identify beneficiary companies that made economic announcements. Page 18 of 31 August 12, 2004

Comparison of Announcements with Transportation Spending to All Economic Announcements (1999 May 2004) Total jobs Jobs Matched County Announced With IAP Spending Greene 291 241 Hale 32 0 Pickens 134 0 Bullock 82 72 Butler 1465 575 Lowndes 392 280 Macon 200 200 Clarke 517 0 Choctaw 207 0 Conecuh 164 150 Dallas 1663 75 TOTALS 5147 1593 Percent traced to Transportation 31.0% Table 2: Comparison of economic development announcements where transportation investments could be identified. Source: ADO Announcement List 5/04, DOT Industrial Access Project List 6/04 To optimize infrastructure investments, and to improve targeted economic development recruiting efforts, special attention to the Black Belt could come in the form of Rural Development Councils, such as those in forty other states, including Mississippi, Georgia, Florida South Carolina and North Carolina. These are ongoing, well funded organizations, with the Georgia rural agencies contributing $62 million annually to rural infrastructure and economic development projects. 9 In contrast, only $18 million was spent in Black Belt counties over the 9-year period 1995-2004 by the Alabama Department of Transportation Industrial Access Project fund (a $12 million annual set aside statewide). 10 The Auburn report lauded a bill passed by the State Legislature in 2001 creating two levels of economic development incentives. From a formula based on economic factors such as population shifts, per capita income and unemployment, the bottom 23 counties are allowed to provide incentives for smaller capital projects. Although many other states have such legislation in place, Alabama has acknowledged through public policy that some areas of the state are distressed. The gap in economic development impact is evident in the cluster of rural counties surrounding the Mercedes plant in Tuscaloosa County. Even with such a nearby boost in jobs, Bibb, Hale, Greene, Pickens, Fayette and Walker have fewer people employed today than before the plant opened. 11 Page 19 of 31 August 12, 2004

PART III: GAP ANALYSIS BETWEEN LOCAL RURAL TRANSPORTATION PLANNING AND STATE IMPLEMENTATION OF PROJECTS. In Alabama, rural transportation planning is generally based on the four-lane corridor planning program 12. Statewide transportation planning is conducted by ALDOT s 9 districts, in coordination with ALDOT county engineers. Alabama also has 12 regional planning commissions, which include transportation planning within their comprehensive plan. Regional planners work with ALDOT on programs such as safe communities/safe boating, surface transportation safety grant and construction, surface transportation planning, training, and technical assistance, transit programs, community and environmental programs. UAH Office of Economic Development funded by USDOT Grant DDTS59-03-G-00008on collecting data from regional councils regarding their input to a statewide strategic plan, which included description of transportation needs (See Figure 5). Many of these needs are not addressed by the ALDOT State Transportation Improvement Program (STIP), thus creating the gap between local planning by elected officials, regional planners, and county engineers and the project selection/budgeting process at the state level. The process does not allow for connecting of the plans with project selection. The statewide strategic plan is collected and utilized by the Alabama Development Office however, no formal presentation is made to the State Department of Transportation. The study goes on to address the gap analysis between the transportation planning goals of regional commissions and the actual plans adopted by the State DOT. Another barrier to effective rural infrastructure/transportation planning is that there is not an appointed panel in the state responsible for rural transportation planning. The Alabama DOT has a metropolitan planning group and a county planning group, but there is no special consideration given for the rural counties. 13 Page 20 of 31 August 12, 2004

Alabama Association of Regional Councils Regional/Statewide Economic Development Strategic Plan Transportation Issues July 2003 Region 2 Hale, Greene, and Pickens Hale County: - Improve Alabama 69 to four lanes through the county - Improve all county roads and bridges to meet minimum state standards - Pave dirt roads in the county Greene County: - Four lane U.S. 43 throughout the county - Upgrade the country road and bridge system Pickens County: - Construct north south corridor from Muscle Shoals to Mobile - Four lane U.S. 82 through the county - Upgrade the county road and bridge system to meet minimum state standards - Upgrade Alabama 14 and 17 throughout the county Region: - Completion/Expansion of U.S. 43 - A north south, interstate quality highway Region 5 Lowndes, Butler, Bullock, and Macon Lowndes County: - Widen I-65 to six lanes from Montgomery to interchange 158 in Lowndes County - Widen and resurface U.S 31 through county - Widen and resurface U.S. 80 through county Butler County: - Development along I-65 from Montgomery to Greenville in Butler County Bullock County: - Widen and resurface Alabama 110 in Bullock County Macon County: None Region: - Development along I-65 corridor south - I-85 extension from Montgomery to Selma - Improvements to U.S. 31, 231, 331, 80 and Alabama 110 in Bullock, Crenshaw, Lowndes, Montgomery, and Pike counties. (Montgomery, Pike, and Crenshaw are not considered rural) Page 21 of 31 August 12, 2004

Alabama Association of Regional Councils Regional/Statewide Economic Development Strategic Plan Transportation Issues July 2003 (Continued) Region 6 Sumter, Choctaw, Washington, Marengo, Clarke, Monroe, Conecuh, Wilcox, Dallas, and Perry Sumter County: - Improvements to U.S 80 - Improvements to Alabama 17 and 21 Choctaw County: - Improvements to U.S. 84 - Improvements to Alabama 10 and 17 Washington County: - U.S 43 corridor - Improvements to Alabama 17 Marengo County: - U.S. 43 corridor - Improvements to U.S. 80/I 85 - Improvements to Alabama 10 and 21 Clarke County: - U.S. 43 corridor - Improvements to Alabama 5 - Improvements to U.S. 84 Monroe County: - Improvements to U.S. 84 - Improvements to Alabama 21 Conecuh County: - Improvements to U.S. 84 - Improvements to Alabama highways Wilcox County: - Improvements to Alabama 5 and 10 Dallas County: - Improvements to U.S. 80/I 85 - Improvements to Alabama 5 Page 22 of 31 August 12, 2004

Alabama Association of Regional Councils Regional/Statewide Economic Development Strategic Plan Transportation Issues July 2003 (Continued) Perry County: - Improvements to U.S. 80/I 85 - Improvements to Alabama 5 Region: - Completion of North South and East West four lanes U.S. 80, 84, and 43 - Upgrades to Alabama 5, 10, and 17 - Improvements to Alabama 5,10,14,17,21,22, and 41 - Improvements to U.S. 43,45,80, and 84 Region 7 Barbour Barbour County: - Four lane U.S. 431 from the Barbour County line to Seale Region: - I 10 connector - Complete work on U.S. 84 - Four lane Alabama-Georgia bridge on U.S. 84 - Four lane Alabama 167 from Troy to Florida state line - Four lane Alabama 52 from Dothan to Alabama 167 in Hartford Region 8 Escambia Escambia County: None Region: - Develop regional transportation plan - Develop regional infrastructure plan Page 23 of 31 August 12, 2004

Black Belt Counties Gap Analysis Between Regional Commission Strategic Plans 2003 And AL DOT STIP (2004-2008) Approx. Total Percent Description # of miles Segment Being in project Miles improved Pickens County: US 82 from the Mississippi state line to CR 75 7 US 82 in Pickens county 32 22% Hale County: SR 69 from Moundville to Tuscaloosa* 16 SR 69 in Hale county 40 40% *less than 1 mile of SR 69 is in Hale county between Moundville and Tuscaloosa Sumter County: US 80 from SR 28 east to SR 28 west of the Tombigbee River 4 US 80 in Sumter county 25 Marengo County: US 43 from SR 69 to SR 28 1 US 43 in Marengo county 37 Clarke County: SR 5 from US 43 to SR 25 4 SR 5 in Clarke county* 4 16% 3% * SR 25 meets SR 5 in Wilcox county US 43 from Thomasville to the Marengo county line 5 US 43 in Clarke county 37 Barbour County: US 431 from the Barbour county line to SR-6/US 82 @ Hoboken 10 431 in Barbour county 25 US 431 from the Barbour county line to Seale* 15 431 in Barbour county 25 *Seale is in Russell county 22% 50% Remaining 13 Black Belt Counties have no projects on the STIP Figure 5: Gap Analysis between Locally Generated Comprehensive Plans and ALDOT long range STIP. Page 24 of 31 August 12, 2004

PART IV: COMPARISON OF CORRIDOR AND RURAL PLANNING METHODS IN FLORIDA AND GEORGIA AND METHODOLOGY RECOMMENDED BY U.S. DOT Georgia Department of Transportation in conjunction with Georgia Institute of Technology has developed a Multimodal Transportation Planning Tool for rural areas in Georgia. Used by planners at the county and regional level, this tool organizes existing databases from multiple sites so that information such as crash statistics, traffic counts, and road conditions are readily accessible for planners preparing regional transportation plans and justifications for project requests. The tool gives a text print out of hot spots and offers downloads of GIS maps. It can predict future needs only based on the trend line from past usages, and cannot take into account major events such as industrial expansions or new road construction. 14 The Georgia Department of Transportation also administers the Governor s Road Improvement Program (GRIP), which benefits rural areas by providing connectivity. The goal of GRIP is to ensure that 98% of all areas within the state will be within 20 miles of a four-lane road. The network of 18 corridors is called the Developmental Highway system, and is funded by bond money provided by act of the state General Assembly in 1989. 15 A recent study of the economic benefits of GRIP, conducted by University of Georgia, found evidence of a beneficial linkage between the state s developmental highways and rural economic development. Specifically the study examined economic performance of the rural counties between 1990 and 2000 considering population, total personal income, labor force, employment and unemployment. Although GRIP did not produce any population growth in the state, several GRIP counties experienced sharper drops in unemployment than non-grip counties. There were regional differences in the economic impacts (between North, Middle and South Georgia). Additionally, a second economic impact methodology indicated that short term economic impacts of GRIP construction projects benefited the rural counties in terms of sales, value added, labor income and employment. This was a significant boost to some rural counties with a low economic base. 16 Finally, the study provided anecdotal evidence of GRIP s economic impact using qualitative examples from 4 projects. The State of Florida has instituted the Florida Intrastate Highway System, and again, policy measures were important in the implementation. The Florida Legislature established this program in 1990 to provide linkages and connectivity, to project congestion, and to plan for the alleviation of congestion to support economic growth in trade and tourism. While the FIHS is not a rural initiative per se, the goal of connectivity benefits rural areas between major destinations. 17 The State of Florida also is a leader in transit planning, and was awarded the United We Ride State Leadership Award by Transportation Secretary Norman Mineta. The award recognizes excellence in improving transportation for older adults, people with disabilities and low-income families. Florida accomplishes this through its Commission for the Transportation Disadvantaged, which includes planning for service in rural areas. 18 The Federal Highway Administration provides extensive on-line resources to assist rural communities in the transportation planning process. A planning guide identifies the following key success factors to rural transportation planning: Set the overall transportation direction for the rural area and define the transportation future/vision to plan toward. Provide a decision-making structure, incorporating a participatory public involvement process, to plan and prioritize improvements to the rural transportation system. Build on existing knowledge, resources, and information to conduct technical analysis including evaluation of current and future conditions, forecasts, and trends. Page 25 of 31 August 12, 2004

Balance multiple and competing stakeholder objectives and funding expectation. Identify and provide long-range funding program. Provide a framework to prioritize expenditures based on policy goals and objective. Focus short-range investments on long-term goals. Provide accountability to customers on future direction and actions to get there. 19 The same document recommends a multiple criteria analysis to evaluate transportation projects: Public Support Congestion Safety Environment System Continuity Preservation of System Economic Impact Inter/Multimodal Ability to Implement PART V: CONSIDERATION OF ECONOMIC DEVELOPMENT VIA TRANSPORTATION RELATED INDUSTRIES. Through the construction of highways and roads, there is a short-term boost to local economies. 20 An additional way to increase the impact of infrastructure investment on economic development would be to create economic activity through the establishment of an intermodal center in a rural area of the state. The UAH OED has submitted several proposals for funding of a feasibility study to draft a business plan, seek public/private partnership members and capital resources toward the development of a rural intermodal center. Such a study is recommended as the next step to follow this initial work on the role of infrastructure investment in contributing to economic development of rural areas. CONCLUSIONS: Although the absence of infrastructure presents a barrier to economic development, infrastructure without accompanying workforce development will not yield significant economic development. Policy directives for a state department of transportation seem necessary to elevate attention to rural infrastructure investment. To quote Phillis Belcher of the Greene County Industrial Board, It s the people! This points to an urgent need for training rural citizens for living wage jobs, or potentially jobs that would supplement a farming income, since many of today s small farmers are surviving at subsistence levels. Beyond workforce development, there is the issue of the current condition of public education in the Black Belt. Potential employers have a disincentive to locate in areas where relocating employees would be dissatisfied with the educational offerings. Much adult workforce development could be made more efficient if the adults had a solid early educational background and resulting life skills levels. The complex nature of the many factors affecting economic development indicates that a comprehensive economic development strategy would be much more effective in producing entrepreneurship opportunities and employment opportunities than would a stand-alone infrastructure investment. Page 26 of 31 August 12, 2004

RECOMMENDATIONS 1. Work with ALDOT to determine the feasibility of a rural transportation planning department. Conduct an organizational assessment to identify how such a department would fit into the existing (or new) structure. Potential considerations are suggested below. A department of rural planning with oversight by an appointed panel of individuals whose primary responsibility is rural transportation planning could bridge the gap between isolated rural county planning and Statewide planning. This department would create a statewide vision for rural transportation improvements. A statewide vision could address connecting several rural areas around several urban/industrial hubs in a holistic plan, rather than individual counties competing for funding to better connect their local areas to the hubs. Further study outside the scope of this project would determine the need for keeping rural planning/spending separate from (or isolated within) overall state transportation planning. Because rural projects will generally not provide the same impact in terms of dollars spent per outcome measure, (whether that measure is lives impacted by a safety measure or jobs created by infrastructure investment) rural projects often have a lower priority level than urban projects. This is by virtue of the fact that rural areas are by definition less populated, thus spending on rural projects is never leveraged over as large a number of citizens as is spending on urban projects. 2. Identify the key steps needed to establish a state policy on rural transportation planning, using the Georgia and Florida models. Identify potential champions in the Alabama State Legislature to garner support for a rural initiative. Success of a rural transportation department might require a policy directive from the State Legislature. For example, State legislatures in Georgia and Florida have provided for specific, long term funding of four-lane programs (which helps connectivity of rural areas.) These programs are the Georgia Governor s Road Improvement Program (GRIP) and the Florida Intrastate Highway System. 3. Conduct a feasibility study of a rural intermodal center that would encourage entrepreneurship, job creation, and wealth creation in a struggling area. We recommend a study of the feasibility and economic impact of infrastructure investments in rural intermodal facilities. Traditional economic development efforts provide incentives for target companies seeking new location sites. The major advantage offered by rural locations is inexpensive land, and an inexpensive labor pool. However, the disadvantages are that the rural industrial parks are not as convenient to major arteries, and they usually have limited infrastructure support such as utilities, communications and sewer service. Oftentimes, an industrial park is little more than a former farm, set aside for sale or lease to a commercial or industrial entity. Another disadvantage is that the labor pool may not be well prepared for the skills required by the new industry. Given these disadvantages, it is difficult to attract new industry to rural areas. Rather than having the goal of making a rural area more attractive to relocating businesses, another economic development approach would be to establish a local rural enterprise, which creates the jobs itself. It is our hypothesis that the skills requirements for shipping, packaging and potentially value-adding operations of an intermodal center are a better match for a rural population than high tech or even medium technology operations. Having an economic development set of criteria, in addition to the typical criteria of justification by sufficient container volume/truck traffic, is an innovative way to plan a statewide intermodal system. Page 27 of 31 August 12, 2004

References 1 Economics Research Service, U.S. Department of Agriculture, http://www.ers.usda.gov/briefing/rurality/whatisrural/, August 2003. 2 Larry Lee and Joe Sumners. Beyond the Interstate, the Crisis in Rural Alabama, Auburn University Economic Development Institute. January 2003. 3 University of Alabama Institute for rural health research website, http//irhr.u.edu/blackbelt/intro.html. 4 AECOM Consult, for U.S. Department of Transportation, Federal Highway Administration, U.S. 43 Corridor Between I-20/I-59 near Eutaw to I-65 at Mobile, April 2003, p. 141. 5 West Alabama Regional commission and AL Tombigbee Regional Commission I 20/50 Corridor Study Tuscaloosa to Mississippi. March 2004. www.warc.info/documents/corridorfinal.pdf. 6 AECOM Consult for U.S. DOT Federal Highway Administration, Study of US 43 and US 80 Corridor Potential to Attract New Automotive Suppliers, November 2003. eoncdev/alcor.htm. 7 U.S. Census, 2000. 8 Alabama Development Office statistics, 2004. 9 Larry Lee and Joe Sumners. Beyond the Interstate, the Crisis in Rural Alabama, Auburn University Economic Development Institute. January 2003. 10 Alabama Department of Transportation, List of Industrial Access Projects, 2004. 11 Larry Lee and Joe Sumners. Beyond the Interstate, the Crisis in Rural Alabama, Auburn University Economic Development Institute. January 2003. 12 Dye Management Group. Federal Highway Administration Rural Transportation Planning Workshops. Alabama, Summer 1999, p. 5. 13 Phone Interviews, Frank Coursen, State Director of County Transportation Engineers, Alabama Department of Transportation, Robin Roden ALDOT Tuscaloosa County Engineer. 14 Phone interview, Tom McQueen, Georgia Department of Transportation Division of Transportation Planning, Data and Intermodal Development. 15 Georgia Department of Transportation Website: http://www.dot.state.ga.us/dot/planprog/planning/programs/grip/index.shtml 16 Humphreys, Jeffrey. The Economic Benefits of the Governor s Road Improvement Program (GRIP). Terry College of Business, The University of Georgia, October 23, 2003. 17 Keeping Florida s Economy Growing, State of Florida Department of Transportation. http://www.dot.state.fl.us/planning/systems/fihs/default.htm, August 2003. 18 TD Connector, Volume 9, Issue 1, Spring 2004. 19 Planning for Transportation in Rural Areas. U.S.DOT Federal Highway Administration. http://www.fhwa.dot.gov/planning/rural/planning/fortrans/4successrtp.html 20 Humphreys, Jeffrey. The Economic Benefits of the Governor s Road Improvement Program (GRIP). Terry College of Business, The University of Georgia, October 23, 2003. Page 28 of 31 August 12, 2004

APPENDIX TABLE OF CONTENTS 1. UAH OED Transportation Survey. 2. Corridor Studies Page 29 of 31 August 12, 2004

APPENDIX 1 Transportation Survey Responses from Black Belt Companies Company Problems Infrastructure Needs Cahaba Valley Timber High fuel prices. Wood prices in the Need to complete rail spur to the Selma, AL Dallas County area are dictated by International Paper Co. industrial park. Need to 4 lane Hwy 41 from Hwy 80/22 to the industrial park. Need to make Selma more accessible to Hyundai in Montgomery and to Tallassee. Citation Marion (Ductile Iron Castings) Marion, AL Perry County HL-A Selma, AL Dallas County Southland Mower Selma, AL Dallas County Scheduling back hauls. Using US 80 instead of going to Hwy 5. They use CR 45, which is 2 lanes and slows the trucks down. Has had trouble with routes to Ohio due to carrier paperwork. Has had damaged freight. New freight carriers have start up problems Scheduling trucks in regional area. Routes have to wait until trucks are in that area. Complete US 80. Improve CR 45 No Needs Tek Pak Nothing Major No Needs Marion, AL Perry County Big River Industries Livingston, AL Sumter County Fuel costs. Log laws have made trucking more expensive. They experience service issues due to cut backs in rail and barge providers. Build I 85 from Montgomery going west. Complete the 4 lane of US 80. Dredging and maintenance of rivers and Clayborne dam. The Tenn-Tom is underutilized in their area with an inland dock that hasn t been used since the 70s. Improve the Port of Epes Southwest Paper Can t get trucks Develop the Port of Epes. Livingston, AL Sumter County Prystup Packaging Livingston, AL Sumter County Not enough trucks, late deliveries, loss of independent truckers due to increases in insurance, liability, and fuel costs. Timing for outbound products, claims, damaged and lost freight. No Needs La Bour Pumps Selma, AL Dallas County American Apparel Weight limits on trucks. No Needs Selma, AL Dallas County Build I 85 west of Montgomery through Selma. Page 30 of 31 August 12, 2004

Livingston Box Trouble finding trucks within 100 Livingston, AL miles. Sumter County West Alabama Converting Trouble getting trucks. High fuel Livingston, AL prices. Sumter County Economic development in the black belt should help draw more trucks to the area. More rail service to offset lack of trucks. ADC Products/Brandco. Carriers don t come to their area Widen streets near rural plants. Greensboro, AL Hale County Demopolis Hickory Mill everyday. No problems No Needs Demopolis, AL Marengo County Cemex, Inc. Not enough trucks for hire. No Needs Demopolis, AL Marengo County Henry Brick Company, Inc. Damaged shipments on rail. New Bridge replacements and better Selma, AL Dallas County Sumter Veneer Works, Inc. DOT regulations are an issue. No problems roads. No Needs Eutaw, AL Greene County Miller & Company Selma, AL Dallas County Mannington Wood Floors Epes, AL Sumter County Caraustar, Inc. Livingston, AL Sumter County Hard to find trucks to go to the Northeast. Toll shipments are a problem. Lack of trucks. Cost of insurance and fuel. Taking too long to build bridge on Hwy 14 at the Tombigbee river. No Needs Need more trucking business. Improve and use Port of Epes. Need wider roads, more lanes. Page 31 of 31 August 12, 2004