What Are The Services Of Streets And Highways?

Maryland’s economy and quality of life are influenced by the State’s transportation network. The beneficial impacts of roads on production and productivity are well recognized by economists, but the existence and maintenance of this interconnected system also fulfills many functions and provides significant benefits directly to Maryland citizens.

The road network links Maryland both internally and with the rest of the country, meeting the ever-growing demand for the movement of people, goods and services by providing:

• The primary means of movement for vehicles as well as bicycles and pedestrians;
• Long distance mobility for industry and recreational travel;
• Local accessibility;
• A network for the delivery of emergency services; and,
• A right of way for utilities.

Why Are These Services Important?

An efficiently managed road network can support a highly mobile economy, provide the convenience of personal transportation, and sustain the capacity necessary for the non-rail freight movement.

While Maryland is striving to increase the capacity of its public transit system and to add facilities for bicycles and pedestrians, it is essential to maintain the integrity of the existing road network for buses, in-road bicycles, sidewalks for pedestrians, and the movement of freight.

How Have Streets and Highways Changed Over the Years?

In the early 20th century, cities took responsibility for their own roads by taxing adjacent property owners to fund improvements. States and the federal government took the lead in outlying areas. Gradually the roadway system became more standardized and the federal government more involved in road construction funding. In 1956, President Eisenhower signed into law the Federal Aid to Highways Act, which authorized the construction of 40,000 miles of limited access roads. This act culminated in the creation of our modern interstate highway system.

Today, the National Highway System (NHS) includes the Interstate Highway System as well as other roads important to the nation's economy, defense, and mobility. The NHS is now nearly 100% complete.

Methodology & Data Sources:

The annual value of services from highways and streets is derived the Bureau of Economic Analysis (BEA) figures of the net stock of federal, state, and local government streets and highways from 1950 to 2004. The annual value of services from streets and highways is estimated by taking 7.5 percent of the net stock value. This is based on the logic that around 10 percent of the net stock (2.5 percent for depreciation and 7.5 percent for average interest rates) is the estimated annual value of all services from streets and highways. However, since we assumed that 25 percent of all vehicle miles are for commuting (a defensive expenditure), this leaves 75 percent as net benefits. Thus the GPI assumes the net service value of streets and highways is 75 percent of 10 percent, or 7.5 percent of net stock. In 2004 we estimate the value of services from streets and highways at $111.55 billion, an addition to the GPI account. US and state highway mileage was taken from the US statistical abstract for some years, and the ratios from some years extended between them and after 2006 (the latest available data). The ratio barely changes, allowing for such an operation. For early years, municipal and rural highway numbers were used.

Equation:

(Stock of Highways and Streets) Multiplied by 7.5%

More Information

Maryland State Highways Administration (SHA)