Reason Foundation’s 28th Annual Highway Report evaluates state highway systems on cost versus quality using a method developed in the early 1990s by David T. Hartgen, Ph.D., emeritus professor at the University of North Carolina at Charlotte. This method has since been refined by Hartgen, M. Gregory Fields, Baruch Feigenbaum, and Truong Bui.

Since states have different budgets, system sizes, and traffic and geographic circumstances, their comparative performance depends on both system performance and the resources available. To determine relative performance across the country, state highway system budgets (per mile of responsibility) are compared with system performance, state by state. States with high rankings typically have better-than-average system conditions (good for road users) along with relatively low per-mile expenditures (also good for taxpayers).

The following table shows the overall highway performance of the state highway systems in the 28th Annual Highway Report, primarily using data that each state directly reported to the Federal Highway Administration.

Similar to last year, the top-performing states are a mix of large and small states as well as states that are more urban and more rural. (Tables 1, 2, 3, 4, and Figure 1). Five large-population (more than seven million people) states place in the top 10 of the overall rankings: North Carolina (2nd), Virginia (4th), Tennessee (5th), Georgia (6th), and Ohio (10th).

Numerous factors—terrain, climate, truck volumes, urbanization, system age, budget priorities, unit cost differences, state budget circumstances, and management/maintenance philosophies—all affect overall performance in the Annual Highway Report. The remainder of this report reviews the statistics underlying these overall rankings in more detail.

The overall rankings are not dramatically different from the previous version of the Annual Highway Report. However, three states’ overall ranking improved by double digits this year, while two states’ overall rankings declined by 10 or more spots:

• Idaho improved 19 positions from 34th to 15th in the overall rankings, as rural Interstate condition improved by 34 positions and urban Interstate condition improved by 22 positions. In addition, the rural fatality rate improved by 20 positions.
• Maine improved 11 positions from 32nd to 21st in the overall rankings, as rural Interstate condition improved by 24 positions. Capital disbursements also improved by 12 positions.
• New Jersey improved 10 positions from 44th to 34th in the overall rankings, as administrative and maintenance disbursements improved by 15 and 25 positions respectively. Rural Interstate condition improved by 12 positions.
• Massachusetts declined 20 positions from 20th to 40th in the overall rankings, as rural Interstate condition declined by 23 positions. The state also fared poorly in disbursements. Administrative disbursements worsened by 19 positions and maintenance disbursements declined by 26 positions.
• Arkansas declined 15 positions from 13th to 28th in the overall rankings, as rural fatalities declined by 25 positions and urban fatalities worsened by 39 positions. Capital disbursements also declined by 10 positions.

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Each state’s overall rating is determined by rankings in 13 categories, including highway expenditures per mile, Interstate and primary road pavement conditions, urbanized area congestion, bridge conditions, and fatality rates.

The study is based on spending and performance data state highway agencies submitted to the federal government, supplemented by data from the National Bridge Inventory, INRIX, and the American Community Survey. This study also reviews changes in highway performance over the past year. 

Although individual state highway sections (roads, bridges, pavements) deteriorate over time due to age, traffic, and weather, states perform maintenance to keep infrastructure in a state of good repair. They also reconstruct roadways when necessary. As a result, system performance can improve even as individual roads and bridges worsen. Table ES1 summarizes recent system trends for key indicators. The U.S. saw system improvements in some categories from 2020 to 2022, but declines in several other categories.

Between 2020 and 2022, three of the four disbursement measures (Capital and Bridge, Maintenance, and Administrative) for the U.S. state-owned highway system increased (states spent more money on their highway systems in 2022 than in 2020). The other disbursement measure (Other) decreased from the previous report. And when factoring inflation into account, spending has been roughly consistent over all categories during the past five years.

Further, six of the nine performance measures improved, including Rural Interstate Pavement Condition, Urban Interstate Pavement Condition, Rural Other Arterial Pavement Condition, Urban Other Arterial Pavement Condition, Rural Fatality Rate, and Structurally Deficient Bridges (a smaller percentage of bridges is structurally deficient).

Three of the nine performance measures worsened: Urbanized Area Congestion, Urban Fatality Rate, and Other Fatality Rate.

Overall, when adjusting for inflation, states are spending about the same amount of money for a slightly better quality roadway system.

Table ES2 summarizes system trends over the past 10 years.

Over a 10-year period disbursements increased, pavement quality worsened, congestion improved (on a statewide basis), the percentage of structurally deficient bridges decreased, and the fatality rate held steady. The worsening urban Interstate quality and rural arterial pavement quality are a change from the previous 10-year period. Figure ES1 displays this information in a graph.

Figure ES1: Trends in Highway System Performance

Figure ES2 shows each state’s ranking based on 2022 data. The top-performing states tend to be a mix of high-population and low-population states that lean both urban and rural.
Very rural, low-population states may have had a slight advantage before 2019. But since the report changed to using expected disbursements and ratios, that advantage no longer exists. For example, while North Dakota often leads the rankings, this year North Carolina ranked first followed by South Carolina, North Dakota, Virginia and Tennessee.

At the other end of the rankings are Alaska, California, Hawaii, Washington, and Louisiana. Two of the five worst performing states rank in the bottom 11 in population.

A number of states with large populations and/or large metro areas fared well: North Carolina (1st), Virginia (4th), Tennessee (5th), Georgia (6th), and Ohio (10th).

Some states had large increases or decreases in their ratings. The rankings for Idaho, Maine, and New Jersey improved by at least 10 spots.

However, the rankings for Massachusetts and Arkansas worsened by at least 10 spots.

Certain states spend significantly more than the national average. This spending may be justified if these states perform well in other categories. While some states’ disbursements have improved their deficiencies, other states are still performing badly:

• For Capital and Bridge Disbursements, five states have per-mile ratios higher than
  1.5: Washington, Idaho, Alaska, Utah, and Indiana.
• For Maintenance Disbursements, 11 states have per-mile ratios higher than 1.5: Washington, Indiana, Vermont, Oregon, Delaware, Colorado, California, Oklahoma, New York, Massachusetts, and Alaska.
• For Administrative Disbursements, six states have per-mile ratios higher than 2.0: Vermont, Nevada, Delaware, Washington, New Hampshire, and South Dakota.
• For Other Disbursements, three states have per-mile ratios higher than 2.0: Washington, Kansas, and Vermont.

System performance problems in each measured category seem to be concentrated in a handful of states:

• More than 25% of the rural Interstate mileage in poor condition is in just three states: Alaska, Colorado, and California.
• More than 30% of the urban Interstate mileage in poor condition is in just six states: Hawaii, Louisiana, New York, California, Delaware, and Colorado.
• Approximately 13% of the rural arterial mileage in poor condition is in just three states: Alaska, Rhode Island, and Vermont.
• Approximately 40% of the urban arterial primary mileage in poor condition is in just five states: California, Nebraska, Rhode Island, New York, and Massachusetts.
• Automobile commuters in seven states spend more than 60 hours annually stuck in peak-hour traffic congestion: New Jersey, Massachusetts, Delaware, New York, Illinois, Maryland, and California.
• Although a majority of states saw the percentage of structurally deficient bridges decline, nine states report more than 10% of their bridges as structurally deficient: West Virginia, Iowa, South Dakota, Rhode Island, Maine, Pennsylvania, Louisiana, Michigan, and North Dakota.
• Three states have rural fatality rates of 2.0 per 100 million vehicle-miles traveled or higher: Hawaii, Delaware, and Alaska.
• Urban fatality rates continue to worsen as 27 states have urban fatality rates of 1.0 per 100 million vehicle-miles traveled or higher: New Mexico, Alaska, Florida, Hawaii, Arkansas, Indiana, Montana, Tennessee, Mississippi, South Carolina, Colorado, Georgia, Arizona, Louisiana, Delaware, Oregon, Texas, California, Missouri, Nebraska, Oklahoma, Alabama, Maryland, Washington, Connecticut, Nevada, and Michigan.
• Other fatality rates continue to worsen as 25 states have other fatality rates of 1.5 per 100 million vehicle-miles traveled or higher: West Virginia, Oklahoma, South Carolina, Kentucky, Louisiana, California, Oregon, Texas, Tennessee, Arizona, South Dakota, North Carolina, Delaware, Nevada, Arkansas, Kansas, New Mexico, Washington, Colorado, Ohio, Mississippi, Georgia, Illinois, Florida, and Alabama.

System performance improved for some states but declined for others this year, with slightly less than half of the states (21 of 50) making progress between 2020 and 2022. However, a 10-year average of state overall performance data indicates that system performance problems are concentrated in a handful of states. These states are finding it difficult to improve. There is also increasing evidence that higher-level highway systems (Interstates, other freeways, and principal arterials) are in better shape than lower-level highway systems, particularly local roads.

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While congestion pricing has been successful in managing traffic in other major cities, such as London and Stockholm, focusing on generating revenue to bail out the transit system instead of traffic management was always going to reduce the program’s effectiveness in New York City. As a result, supporters of congestion pricing as a useful policy tool shouldn’t be upset at the Trump administration’s efforts to kill the New York program. In fact, killing the New York City program, which has rightly been described a revenue grab for rail transit, could improve the prospects for a more effective congestion pricing system over the long-term. 

New York City’s traffic congestion is severe. Each New York City driver loses 108 hours per year. Approximately 700,000 of those drivers enter Manhattan each day from the suburbs. And it would be impossible to build enough new bridges to Manhattan and roadways in Manhattan to reduce congestion using a supply-side approach. Therefore, elected officials borrowed a page from cities across the world and decided to use a demand-side approach: cordon pricing. 

New York is using a form of congestion pricing, sometimes referred to as cordon pricing, which charges drivers a set fee for entering a designated area, typically during peak travel hours. The pricing’s primary purpose is to manage traffic volumes by spreading out or reducing trips during rush-hour periods, thus lowering greenhouse gas emissions. Secondary benefits of the congestion pricing plan were additional transit funding from these fees and faster bus travel times. To be effective, the toll must be set at a rate that optimizes traffic flow. 

Cordon pricing works in two ways. The fee, $9 between 5 am-9 pm weekdays and 9 am-9 pm weekdays, makes driving during peak hours more expensive and less attractive. As a result, some commuters switch to making trips during off-peak hours. Others switch to alternative modes, including transit, bicycling, walking, and working from home. Thus, the peak period demand and traffic congestion decrease. 

Congestion pricing has been implemented in several major cities. London has used cordon charging for around 20 years. In that span, Longon’s designated charging zone experienced a 30% reduction in congestion and a 38% increase in transit ridership. Stockholm uses a similar system. It saw a decrease in traffic congestion in the range of 30-50% since its implementation in 2006. 

However, the concept behind congestion pricing and implementing it effectively are two very different things. New York state has been trying to implement congestion pricing in Midtown and Lower Manhattan since the passage of the Traffic Mobility Act in 2019. (The program was formally known as the Central Business District Tolling Program.) The program’s initial start date was set to June 30, 2024, by New York Gov. Kathy Hochul. 

Complicating the congestion charge-setting process, the Metropolitan Transportation Authority (MTA), which oversees many of the city’s bridges and transit lines, demanded that the plan focus on financing $15 billion in needed transit system improvements. Therefore, the congestion charges were, at least in part, selected based on generating the revenue needed for major transit improvements rather than the charges needed to manage traffic congestion in the city. 

Four groups of drivers were particularly upset with the original plan: truckers, delivery drivers, New Jersey residents, and taxi/ride-hail drivers. 

Under the original plan, MTA required trucks to pay $24-$36 (depending on size) to enter the zone, while automobiles would pay $15. 

Delivery drivers claimed any added cost was unfair because it would make daytime deliveries more costly for them and their customers. 

New Jersey commuters were upset that they would have to pay the congestion charge to enter Manhattan after already having paid $15.38 in bridge or tunnel tolls if they used the George Washington or Verrazzano-Narrows Bridge or either the Lincoln or Holland Tunnel. 

Taxi and ride-hail drivers were upset that they would have to pass along the charge to customers via an additional ride fee of $0.75 and $1.50, respectively, for each ride within the city’s designated zone. 

These concerns and the political fallout that could come with them led Gov. Kathy Hochul to suspend the program, fearing a potential voter backlash against Democratic lawmakers up for re-election in November. Complicating matters further, then-presidential candidate Donald Trump announced that he would kill the congestion pricing program if elected. 

To help rebuild support for the congestion pricing program, elected officials and transportation analysts made changes. Truck tolls were reduced by 40%. Medium-duty trucks would pay $14.40, while heavy-duty trucks would pay $21.60. 

For delivery truck drivers, the New York City Department of Transportation announced an off-hour delivery incentive program to develop the infrastructure for businesses to accept deliveries past peak hours. With more night-time coordination between receivers and suppliers, drivers would pay only 25% of the charge. Other cities like Stockholm have found that nighttime deliveries reduced travel time by 25% to 30% and operation costs by 25%.

The cordon charge on passenger vehicles was reduced to $9, but the concerns of commuters using the Hudson River bridges and tunnels saying they’re being double-charged were not addressed. And, the ride-hailing charge was kept in the updated plan. The New York City tolling plan went live on Jan. 5. 

This current plan has three additional problems for the city. Most importantly, the proposed cordon charge is still not set at an efficient level to manage traffic congestion, which should be the primary goal. Early data shows that the congestion charge level has reduced traffic in Midtown Manhattan slightly, but not as much as advocates would hope. The New York Times reported, “In the first week of February, weekday traffic inside the toll zone dropped 9 percent compared with the same time last year, with an average of 561,678 vehicles entering the area, down from 617,000, according to the M.T.A.”

That level is insufficient to reduce peak-period congestion by the desired amounts. It also isn’t going to generate the amount of money the Metropolitan Transportation Authority wants. MTA has a significant hole in its budget and has to pause some transit expansion projects because of insufficient revenue. A 40% reduction in revenue from the original congestion pricing plan would imperil some of MTA’s planned projects. 

The cordon tax is also disproportionately burdening passenger vehicles more than for-hire vehicles. A study by the National Bureau of Economic Research found that, despite a comparable number of trips, personal vehicles would pay $1.057 billion in congestion pricing compared to $244 million for for-hire vehicles. 

And now President Trump is aiming to end the program. The New York Times:

President Trump intends to revoke federal approval of New York City’s congestion pricing program, fulfilling a campaign promise to reverse the policy that tolls drivers who enter Manhattan’s busiest streets to help finance repairs to mass transit.

In a letter to Gov. Kathy Hochul on Wednesday, the president’s transportation secretary outlined Mr. Trump’s objections to the program, the first of its kind in the nation, and said that federal officials would contact the state to “discuss the orderly cessation of toll operations.”

The letter, from Sean Duffy, the transportation secretary, cited the cost to working-class motorists, the use of revenue from the tolls for transit upgrades rather than roads and the reach of the program compared with the plan approved by federal legislation as reasons for the decision.

Mr. Duffy did not indicate a specific date by which the federal government intended to end the program.

Mr. Trump wrote in a post on his social media platform, Truth Social, that New York was “saved” as a result of this news.

“CONGESTION PRICING IS DEAD. Manhattan, and all of New York, is SAVED,” he wrote. “LONG LIVE THE KING!”

Ms. Hochul defended the congestion pricing program on Wednesday and vowed to fight the president’s move.

“We are a nation of laws, not ruled by a king,” she said in a written statement. “We’ll see you in court.”

If courts side with Trump’s effort to kill it, New York City may ultimately be thankful that the tortured version of congestion pricing that creates many losers and won’t reduce congestion over the long term can be replaced. A better congestion pricing plan focused on the primary goal of managing traffic congestion and improving mobility for individuals and businesses in and around New York City rather than a plan primarily designed to generate money to reduce MTA’s debt would benefit all involved.

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Introduced during the 1970s oil crisis to reduce highway congestion and fuel consumption, HOV lanes are limited to vehicles with two or more people. The purpose of HOV lanes is to offer a less-congested travel alternative to the general-purpose highway lanes by encouraging drivers to carpool. HOV lanes in the United States have various occupancy requirements, including two people (HOV-2) or three people (HOV-3). Vanpools (shared vehicles carrying five to 15 passengers) and transit buses can also use HOV lanes. 

During the oil crisis, carpool lanes were successful in managing traffic flow and promoting carpooling. However, once oil prices dropped, many commuters ditched carpooling. While 20.4% of Americans commuted together in the 1970s, by 2008, the percentage of carpoolers had declined to less than 10%. This decline in carpooling has led to empty HOV lanes in many areas.

Three other factors also distort carpool lane usage: the “Goldilocks phenomenon,” fampools, and solo vehicles. 

The “Goldilocks phenomenon” draws from the well-known children’s story: It refers to HOV lanes that are too “hot” (overused) or too “cold” (underused). In cities with too-hot HOV lanes, an excess number of drivers use the carpool lanes, causing traffic flow to slow and leading vanpools and buses to encounter the same congestion as the other lanes. This reduces the number of people per hour that the lane can carry. It also dissuades commuters from using bus services and reduces vanpool formation because those modes must deal with significant traffic congestion. 

In contrast, too-cold carpool lanes are underused while general-purpose lanes are full. These carpool lanes can tarnish public opinion of HOV lanes because drivers stuck in traffic perceive them as wasteful. In many drivers’ minds, empty carpool lanes should be converted to general purpose lanes open to all drivers. 

Additionally, many vehicles in HOV lanes are not the types of carpools—workers commuting together—that planners envisioned. Many in carpool lanes are fampools, vehicles with passengers from the same household traveling to the same area. Today, fampools make up around 41% of carpool vehicles. Because these fampoolers would travel together regardless of whether there was a carpool lane, they aren’t reducing the number of vehicles on the road. 

Since enforcing occupancy requirements in carpool lanes is challenging, many solo drivers use the lanes without penalty. While police can and do ticket solo drivers for entering HOV lanes, they have other priorities, and the volume of solo drivers willing to try to use them, limited technological capabilities, and lack of a proper observation area mean law enforcement is somewhat limited in enforcing carpool lane occupancy rules.

The Federal Highway Administration (FHWA) does have a stick for poorly performing HOV lanes: the maintenance of minimum average speeds. When average travel speeds drop below 45 miles per hour, it can require states to either increase occupancy requirements, convert the HOV lane to an HOT lane (which may include increasing occupancy requirements), or pay back the federal funding used to build the HOV lane (usually 90% of the overall cost).

States should start converting their HOV lanes to HOT lanes. With high-occupancy toll lanes, solo drivers pay to use the lanes, but carpools, vanpools, and buses do not. Given the large number of two-person fampools and limited capacity in HOT lanes, many transportation agencies will convert a 2+ HOV lane (two or more people traveling together can use the carpool lane) to a 3+ HOT lane (three or more people traveling together can use the toll lane for free).

It is easier to enforce carpooling with a 3+ person per vehicle requirement. In addition, HOT lane operators often use electronic (occupancy detection) enforcement.  

Unlike some toll roads, which use a flat rate per mile, most of today’s high-occupancy toll lanes use dynamic pricing. The level of traffic and demand for the HOT lane dictates the price of the tolls, which rise during heavy travel periods like rush hour. The tolls are priced to ensure the HOT lanes remain free-flowing even during peak hours.

High-occupancy toll lanes are a better option than carpool lanes for most urban areas today. Minimizing traffic congestion in HOT lanes keeps those lanes an attractive option for drivers who need quicker trips, which can also help reduce congestion in adjacent general purpose lanes. HOT lanes also help address the HOV lane enforcement problem. And the toll revenue from solo drivers paying to use the HOT lanes can be reinvested into other highway projects in the corridor, such as highway maintenance, public transit improvements using the lanes, electronic tolling collection and enforcement, or recouping the costs of the HOV-to-HOT lane conversion. 

Today’s transportation agencies should not accept the subpar conditions and results being achieved by HOV lanes. Drivers, transit users, and states would benefit from converting failing carpool lanes into high-occupancy toll lanes.

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Community land trusts are private, nonprofit organizations that own land on behalf of a neighborhood and issue leases to neighborhood residents at an affordable rate. By owning the land, the CLT separates the cost of land from the total cost of purchasing a home, lowering the price for prospective buyers and tenants. They primarily use external donations to acquire land. As a provision of their leases, renters are required to use the CLT as their primary dwelling. The board of a CLT includes private community members, consolidating control of neighborhood decision-making.

Gentrification may occur when developers renovate deteriorated properties or build on unused lots in low-cost neighborhoods for new housing and commercial use. The cost of development and speculation may raise the rental rate, thus shifting the residential market towards wealthier tenants. As a result, the residents predating development are unable to afford post-development rental rates and will relocate. 

In the last five years, Apple, Citadel, Amazon, and several Wall Street hedge funds have expanded into or relocated to Miami. With the finance and tech industries both growing, developers trying to meet the need for new housing for high-income residents are revitalizing existing rental properties for luxury housing. 

Neighborhoods like The Design District and Wynwood, both adjacent to Little Haiti, have transitioned from primarily working-class family to luxury housing. In the last three years, the monthly rent for two-bedroom units has increased by $1,008 and three-bedroom units by $1,457. This significant increase in rent has priced out many long-standing residents. 

Magic City Innovation District, a downtown revitalization project, may significantly raise prices in nearby neighborhoods. The 18-acre project promises to build a mixed-use commercial and entertainment hub with new restaurants, shopping, and nightlife in the neighborhood. Although developers promise to reinvest the funds into the local population, previous revitalization projects’ empty promises leave residents skeptical of receiving the benefits. 

As housing prices have increased in nearby neighborhoods, Little Haiti residents have become concerned as to whether they will be able to afford to stay in their homes. Worried about rising rental rates, Little Haiti residents sought help from the Miami City Commission to handle development concerns. 

The Little Haiti Revitalization Trust (LHRT) was created by the Miami City Commission to address development problems on behalf of residents. The organization attempts to create jobs, attract industry, and encourage housing affordability by disbursing grants and loans to Little Haiti homeowners and small businesses. However, bureaucratic obstacles have stunted progress. There has been frequent turnover for LHRT administrators with several administrative heads resigning. Moreover, the dispersal of funds for business grants and home loans has been lackluster.   

As a result, land use regulations and governmental financial aid are not alleviating the problems associated with development. 

With increased housing costs pressuring Little Haiti residents, market-based solutions could be used to address the effects of market forces. 

One alternative is a community land trust, which provides a voluntary alternative model for neighborhoods to consolidate housing and preserve housing affordability. 

Similar to homeowners associations (HOA), residents in a CLT forfeit the right to certain actions that they can do with the property, like converting homes to Airbnb or student housing, to protect its values. However, as opposed to HOAs, CLTs own the land, reducing land price increases from external speculation from developers. 

Currently, several North American cities have developed land trusts to protect price-sensitive dwellers. The Champlain Housing Trust (CHT) serves as the CLT for Northwestern Vermont. Currently, the Champlain Housing Trust manages over 2,500 apartments, 650 single-family homes, and 140,000 square feet of commercial real estate. The Champlain Housing Trust uses private funding sources like collected rent, donations, and property management fees for most of its revenue stream. While rents are the primary sources of revenue, all properties are leased below market rate, ensuring lower-income residents can afford commercial and residential properties. The trust also sponsors financial education seminars and mortgage assistance to improve residents’ financial stability. 

Since its implementation, housing affordability has improved. The trust removed the cost of land for homeowners, lowering the sale price of homes by 25%. Residents who make less than 30% of the area median income, the midpoint income for a region, are now able to afford housing. Housing is provided to 500 previously homeless residents.

The Parkdale’s Neighborhood Land Trust is another model being used in Toronto. In the last four years, both community land trusts successfully protected 205 affordable units across the Toronto area through private investment. 

Community land trusts can also be used to ensure sustainable economic development without displacement. 

In Boston, Dudley Neighbors Incorporated (DNI) has converted 30 acres of previously underutilized land into 225 affordable housing units and 10,000 square feet of renovated commercial properties. While funding for DNI was originally dependent on public grants (30%) for revenue, most recent financial reports indicate the figure is closer to 5% with the majority of revenue coming from rental income, real estate tax reimbursement, and private contributions. 

Moreover, DNI grants a Community Investment Tax Credit (CITC) to organizations and individuals who donate more than $1,000. DNI gives owners a 50% commonwealth tax credit on their donations, incentivizing businesses to fund sustainable residential and commercial developments.  This mutually benefits donors with tax benefits and tenants with rent-stabilized units. 

It’s important to note that community land trusts are not solely privately funded. Several use federal or state grant money to operate. However, relying on government funds has several problems. CLTs struggle to maintain sustainable funding during political transitions and face opposition from non-CLT constituents for using tax dollars for land acquisition. While these CLTs are not necessarily unsuccessful, they are less effective in the longer term than private CLTs. 

Given the high rate of renter-occupied properties in Little Haiti, both residents and businesses are more susceptible to price shocks from increased development. A CLT would consolidate ownership within the community, protecting the local middle-class residents against increased rents and allowing for market-driven redevelopment. 

The Miami City Commission’s attempts to address gentrification have been subpar. If Little Haiti wants to stop the natural market changes that lead to gentrification, community land trusts ensure the decisions on housing, business, and public amenities are controlled by property owners and the community, not local government.

The post As housing prices rise, Miami’s Little Haiti neighborhood should consider a community land trust appeared first on Reason Foundation.

Microtransit is an on-demand service that connects low-density areas within a metro area to business and activity centers or nearby transit stops. These systems connect riders through their first or last mile of public transit. Microtransit can assist an underserved transportation niche and be particularly valuable for people with limited mobility. 

While transit agencies are still experimenting with this new type of service, several operate cost-effective, reliable services with relatively high ridership. For example, Denver’s Regional Transportation District (RTD) has succeeded with its microtransit system FlexRide. With 26,000 new FlexRide users since 2022 and an increase in overall transit boardings of five million rides two years, FlexRide complements Denver’s fixed-route transit system. 

FlexRide operates in low-density suburban areas and connects riders from the first and last mile of their journey to fixed-route transit services—buses, light rail and commuter rail. Similar to other on-demand transportation services, like Uber and Lyft, microtransit riders can request to be picked up for a ride in just 10 minutes or schedule one up to 30 days in advance. Then, a minibus takes riders to the closest bus or light-rail station to complete their journeys. 

Denver’s Regional Transportation District’s microtransit system has proven very cost-effective. Of RTD’s $784 million operating budget, less than 6% funds FlexRide. But FlexRide has bolstered ridership by more than 10% in lower-density areas, making it a more cost-effective option. However, not all transit agencies have had the same success. Microtransit alone cannot fix a transit system with higher operating costs. 

In contrast to Denver, the Des Moines Area Regional Transit Authority (DART) has struggled with low ridership and high costs. The agency is eliminating the service in two of the three regions that it operates. Despite the 18,000 riders using DART’s traditional microtransit service in 2024, DART On Demand, 40% of the system’s total fixed-route bus service would have been cut if not for a $3.6 million dollar grant from the metropolitan planning organization (MPO). 

Despite the introduction of microtransit service and some recent growth— DART says its overall ridership was up 10%  from July 2023 to May 2024, Des Moines’ transit ridership is still down from its pre-COVID-19 ridership numbers. 

There are numerous differences between Denver and Des Moines that impact transit services and ridership, but it is worth considering how FlexRide is able to encourage ridership cost-effectively while DART On Demand struggles with high costs. 

Both are public transit agencies, but DART On Demand operates all of its own services. DART’s in-house staff conducts the maintenance, operates the bus service, and cleans the vehicles. In contrast, Denver RTD contracts with Transdev, a private transit contractor, to clean, operate, and maintain FlexRide’s bus operations. 

Having transit agencies directly operate service is standard practice in the United States. It often leads to higher costs and lower-quality service. 

When service quality dips, so does ridership. Public agencies rarely meet the same performance standards as private contractors, and even if they must meet metrics, there is rarely a penalty for noncompliance. DART On Demand is a typical example of a transit agency–operated service. The average pick-up time for ride requests has reached 20 minutes, and dissatisfied riders have understandably quit using the service. 

That said, not everybody is unhappy.

“The last time we did a customer satisfaction survey of our riders (2022), the majority of DART On Demand riders (80%) reported being either satisfied (33%) or very satisfied (47%) with their overall DART On Demand experience,” DART spokesperson Sarah Welch emailed* after the initial publication of this article. “Most riders (73%) think they will definitely continue to ride a year from now and 71% are very likely to recommend the service to a friend or family member.” 

Given that the same agency in charge of overseeing service is also operating that service, political concerns and bureaucratic conflict interfere with incentives to improve service. Bureaucratic hurdles slow the decision-making process and reduce the responsiveness to rider problems. So, despite public requests for service improvements, governments’ overly bureaucratic decision-making processes often delay change. 

For DART to initiate change, for example, the board of commissioners votes on pressing matters in a meeting held once a month. The board then takes comments from the public to add to the next meeting’s agenda. When an item moves to the approval stages, the commission needs to approve the changes formally. 

Compare Des Moines’ approach with how Denver RTD operates its microtransit. As with most contracts, private entities must operate a high-quality service to have their contracts renewed. For Transdev, high-quality service means timely vehicle arrivals, reliable drivers, a safe system, and real-time updates to service changes. Considering these metrics, 76% of riders reported being satisfied with the RTD’s service. With high overall rider satisfaction, Transdev makes it more likely it will remain the microtransit provider for RTD. 

The Des Moines Area Regional Transit Authority is experimenting with different types of microtransit services. One promising answer is Flex Connect which contracts with Uber as its primary operator. Although only available in one geographic area, the service has seen promise. Instead of using minibuses, Flex Connect gives riders a voucher for Uber during the workweek. Since Flex Connect is a first-mile/last-mile service that connects to existing fixed-route services instead of a traditional microtransit provider, it’s challenging to make an apples-to-apples comparison. However, transit riders throughout Des Moines could benefit from a fixed-ride service that better connects to the existing network. 

“Given the demand we are seeing for the on-demand service, there is a possibility we may be able to serve more people at a lower cost using fixed route in the future,” Welch emailed. 

By using an independent operator instead of directly operating service, the Des Moines Area Regional Transit Authority’s FlexConnect system might be able to respond better to rider requests and market incentives. By increasing the number of FlexConnect zones, DART could increase ridership on its system and possibly mirror some of Denver’s Regional Transportation District’s success.

All metropolitan transit agencies should consider microtransit and other innovative ways to serve riders, reduce costs and improve efficiency. 

*Editor’s Note: This post has been edited for clarity and added statements from the Des Moines Area Regional Transit Authority.

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In 2023, Florida’s legislature took an important first step, passing a bill incentivizing private developers to create more affordable housing in order to help manage the state’s population growth. Among its funding increases and tax credits, Florida Senate Bill 102, the Live Local Act (LLA), exempts developers building affordable housing from municipal zoning ordinances and density restrictions while granting them tax breaks. The bill also reduces local planning commissioners’ authority to regulate eligible affordable developments.   

Local governments’ responses to the law have been mixed. While some Florida counties have seen these changes as favorable, many have complained that the state legislature is overstepping its authority. Many municipalities have pushed back and countered the Live Local Act with new development restrictions. 

For example, the city of Doral introduced a six-month moratorium to block affordable housing developments. This opposition to SB 102 changes has extended to other suburban areas like Pasco County, which is threatening to sue developers for ignoring local zoning ordinances and construction regulations. 

This year, the state legislature was lobbied by municipal governments hoping to dilute some of the reforms.  On Feb. 7, the Florida legislature unanimously passed Senate Bill 328, hoping it would reduce some local government’s concerns about being preempted by the state on zoning laws.  

Provisions in SB 328 promote investments in affordable housing with fiscal and procedural incentives. The bill features four major incentives for real estate developers: a property tax credit, a sales tax reimbursement on the cost of materials, an exemption from local zoning restrictions, and reductions in construction red tape.

The bill says developers are entitled to tax benefits if they build 40% of their units as rentable and affordable (a minimum of 10 affordable rental units). These provisions use reduced building expenses to incentivize building developments in a traditionally less profitable housing market. Since the original Live Local Act passed, dozens of developers have submitted applications to create eligible affordable housing projects. As Reason.com’s Christian Britscghi described it, “The law is mostly a grab bag of mortgage subsidies and developer tax credits. Tucked inside is a provision allowing developers to build housing in commercial and industrial areas, provided they include a set percentage of affordable housing.”

While far from ideal, the LLA protects developers from more onerous mandatory municipal inclusionary zoning policies. In various Florida countries, developers are mandated to set aside a certain percentage of their units for affordable housing. Instead of forcing the development of affordable housing units, the Live Local Act encourages developers through incentives to set aside units for affordable housing. Although many may understandably argue this oversteps local authority, it reestablishes a choice for developers not found under municipal inclusionary zoning protocols. 

While there is a concern that property owners could use affordable units for public transient lodging, precluding home buyers from purchasing them, the amendments in the newly updated bill try to minimize that possibility by using third-party appraisers to determine which properties are eligible. 

While the Florida bill addressed the biggest problem for developers, reducing the minimum number of units for tax eligibility, it failed to address the major grievances of municipal governments. The state still preempts local authority for height, density, rent control, and zoning. So, many of the quarrels local governments had that this amendment intended to address were not resolved. 

Most of the outcry from Florida’s local governments stems from the nullification of their zoning authority. “The Live Local Act does more to pare back local zoning restrictions than basically any recent reform passed in the nation,” Britscghi writes.

One of the concerns local governments have is that they won’t be able to control their skylines, which they fear could become overwhelmed with development projects. High-income, tourism-heavy areas such as Ocean Drive in South Beach claim that the city needs a certain aesthetic look. However, there is no peer-reviewed research that supports this claim. 

While zoning ordinances are controlled by the local government, they are not inherent authorities. Instead, the state government allocates these powers to municipal governments. The state maintains the right to consolidate authority if the municipality is not properly addressing the issue. Given the strain on housing, the state recognizes housing as a bigger priority over property values and aesthetics.  

Aside from the major issues local governments have, much of the conflict caused by the Live Local Act comes primarily from NIMBYs (not in my backyard). Although many NIMBYs worry about the changes potentially reducing property values, those concerns are likely misguided. Some reports find that the development of affordable housing in vibrant and healthy neighborhoods has no effect on the surrounding property values.  

The distribution of affordable housing only correlates to lower property values when affordable housing is in high concentration. Given that housing developments eligible for tax exemption are only required to have 40% of their units affordable (and assuming developers intend on profit-maximizing), 60% of the housing units in development would be market rate. So, the negative effect of concentrated affordable housing would likely have little to no effect on these property values.

Given the benefit of increased incentives to real estate developers, there is now a stronger motivation to increase the affordable housing supply. Although the backlash from Florida’s municipal governments may stunt the development of these housing projects in the short term, the state government should uphold its preemption and continue incentivizing affordable housing development. 

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