Key Bridge Collapse Highlights Holes In U.S. Infrastructure Funding

The deadly collapse last week of Baltimore’s Francis Scott Key Bridge offers the latest example of the consequences of the deteriorating state of much of the nation’s critical infrastructure. The collision of a container ship with the bridge resulted in six deaths and snapped a major thoroughfare through the city.

The federal government has spent some $400B on infrastructure since 2021, with more planned, but the need far outstrips the allocations. And as aging roads and bridges crumble, local financial interests and the national economy are at risk of suffering damage of their own.

“The recent bills are a down payment,” said Darren Olson, chair of the American Society of Civil Engineers’ Committee on America’s Infrastructure. “So we're moving in the right direction. But our infrastructure gap in this country is still in the trillions of dollars.”

The need is expected to grow as older roads and bridges come into contact with newer vehicles, which tend to be heavier and often move faster than their predecessors. 

“It was built prior to regulations and standards that would have likely required some sort of protection around the pylons,” Olson said of the Key Bridge, built between 1972 and 1977. “A lot of other bridges are that old. They were built before the concept of these large container ships.”

The centerpiece of recent transportation infrastructure spending is the $1T Infrastructure Investment and Jobs Act, which the Biden administration shepherded through Congress and passed in late 2021. The bill included $550B in new spending, above what had already been allocated for infrastructure, over eight years. It was a pared-down version of the administration's $3.5T proposal, Build Back Better.

Since its passage, it has allocated about $400B in funding for more than 40,000 projects nationwide, much of it for transportation projects, according to the ASCE. That includes work on roughly 8,000 bridges, 25 passenger rail lines, 190 airport terminals and 445 port and waterway projects.

That is progress, said LePatner & Associates founder Barry LePatner, a construction attorney and author of Too Big to Fall: America’s Failing Infrastructure and the Way Forward. But he is concerned that the mindset that sees infrastructure as spending rather than an investment that boosts economic growth hasn't changed much.

“They should have doubled that number in the bill, but there were people who were insisting it be cut back,” LePatner said. “We had problems with inflation. We worried about all sorts of things. And so they reached numbers that make a start, but we may find out that it might not make that much of a difference unless we can make trillions of dollars more investment in the very near-term future.”

Political gridlock is already beginning to play out as officials plan to rebuild the Key Bridge. President Joe Biden promised the federal government would foot the entire bill, a pledge that brought broad support from Democrats. Some conservatives, however, argue that the financial burden should be borne by regional governments, The Hill reported last week.

Others have called for the owner of the cargo ship that struck the bridge to foot the bill. Estimates for the bridge's repair vary wildly, from $400M to $2B.

Infrastructure spending has a multiplier effect. A 2022 study by the World Bank found that each public dollar spent on infrastructure generated at least $1.50 in economic activity, with the effect even more pronounced during periods of economic slowdown. A single job in infrastructure construction creates nearly 18 other jobs in other sectors, according to a 2019 study by the Economic Policy Institute.

Similarly, accidents and destruction of infrastructure have ripple effects on the entire economy, including factors that impact commercial real estate. The Key Bridge collapse caused the indefinite shutdown of the Port of Baltimore. That shutdown could help push up inflation, the key metric tied to any decisions to change interest rates. 

Not all infrastructure spending actually goes toward physical repairs, said Benjamin Dierker, executive director of the Alliance for Innovation and Infrastructure, a think tank focused on infrastructure.

“Spending is helpful, but there's a tendency to think it solves all problems,” Dierker said. “When you look where that money goes, it can be to studying the thing, not fixing the thing.”

One issue generally unaddressed by the infrastructure bill is damage caused by excavation to buried infrastructure like pipelines and electric lines, he said.

“There are millions of miles of buried infrastructure just under our feet everywhere,” Dierker said. “We're currently at a record-high damage to our buried infrastructure. As a ballpark figure, there's about 600,000 strikes to buried infrastructure a year, and that's costing about $100B per year to the overall economy.” 

Before the passage of the act, the ASCE detailed the nation's expensive infrastructure deficiencies in its 2021 Report Card for America’s Infrastructure, which grades various kinds of infrastructure by its physical condition. Overall, U.S. infrastructure got a C-minus.

“Those grades aren't ones you'd want to bring home,” Olson said. “I would have been grounded for all of those grades.”

Roughly 40% of U.S. roads were in poor or mediocre condition at the time of the report, with a growing backlog of rehabilitation needs.

The condition of roads amounts to an “invisible tax” costing average motorists about $1K per year in wasted time and fuel, Olson said, a cost that multiplies exponentially for the country’s logistics system.

“The shipping of goods from where they originate from to the very point of delivery can now be somebody's house,” he said. “If an Amazon driver is stuck in congestion and can only deliver 10 packages a day rather than 15, guess what. Those 10 packages he delivered are going to be more expensive to deliver.”

Roads have a specific funding problem related to the fact that much of their maintenance is tied to the gas tax, which is collected according to how many gallons of gas are consumed, a model set up in the early days of highway construction. It hasn't been adjusted for inflation since the 1990s, Dierker said.

“Meanwhile, there's general innovation in the auto industry,” Dierker said. “Better fuel efficiency, hybrids and electric vehicles that are going further on the same gallon or not using gas at all.”

Bridges overall are in slightly better shape than roads, according to the ASCE, but many are getting long in the tooth. There are more than 617,000 bridges nationwide, and as of 2021, 42% of them were at least 50 years old and 7.5% were considered structurally deficient.

As illustrated by the Baltimore collapse — and other deadly bridge disasters in the 21st century, such as the 2007 collapse of an Interstate 35 bridge in Minnesota and the 2002 collapse of an Interstate 40 bridge in Oklahoma — bridges form a critical part of local economies.

“In the short term, much of the attention will be paid to the interference with operations at the port,” economist Anirban Basu, CEO of Sage Policy Group, told Bisnow regarding the Baltimore collapse. “That is arguably our No. 1 economic development driver. It's the No. 1 economic engine.”

By the ASCE’s measurement, rail infrastructure is the strongest it has been in many years and in the best shape compared to bridges and roads, Dierker said, mainly because of private investment in new technologies.

Even so, there are about 1,000 derailments a year, and when rail experiences a failure, the results can be catastrophic, such as the derailment of a Norfolk Southern train in Ohio about a year ago that released toxic chemicals into the air and water. Most incidents are minor, however.

“We're not hearing left and right about derailments in various places around the country, and the main reason for that is they are not really a major event,” Mehdi Ahmadian, a professor of mechanical engineering at Virginia Tech, told NPR in 2023.