Freight Performance Measure Primer

CHAPTER 1. INTRODUCTION

How well does freight move on the Nation's transportation system? Where does it go or where does it come from? Does it travel by rail or by truck or both, and how fast? Where are the bottlenecks, and which ones are the worst? And, how does this impact the U.S. economy? These are questions that State, regional, and local transportation decision-makers try to answer as they determine which plans, programs, policies and investments should be implemented to best support freight movement. State and local departments of transportation (DOTs) and Metropolitan Planning Organizations (MPOs) make decisions to prioritize their programs and projects on a regular basis. These efforts have a direct impact on freight system performance. In addition, even though an infrastructure project may not be explicitly freight-specific, it can impact freight system performance. Thus, the measurement of how these projects impact the performance of the freight transportation system is important.

Two major challenges to freight system measurement are the absence of data and the lack of methods of analysis. There are robust data for the movement of people and passenger vehicles, but understanding freight movement presents different types of challenges to the decision-makers. These movements are based upon supply chain decisions made by individual corporations, which can change over time due to economic conditions. Freight often moves across numerous jurisdictions and by multiple modes of transport. Data that captures origins and destinations and multi-modal performance, as well as methodologies of collecting and utilizing data across multiple jurisdictions and modes, are extremely limited for freight.

Currently, decision-makers are only able to use a few data sources that help in identifying trading partners among States and regions, commodities, tonnage, and value. While formats vary, truck data is the most robust and publicly available information to help understand how freight moves and to support thorough freight analysis. The analysis of multi-modal freight flows is not commonly performed in the United States.

This primer is a resource for the States and MPOs, as well as county or municipal decision- makers to use in analyzing freight movement. It provides a collection of the publicly available data and methods currently in use with information on the next generation of freight measurement. It is intended to help improve the practice of freight performance measurement and establish consistency among practitioners throughout the United States. It is also intended to be updated as new data sources and methods are developed. Additional work still needs to be done to improve the comprehensive and multi-modal understanding of freight.

BACKGROUND ON FREIGHT PERFORMANCE MEASUREMENT

Transportation decision-makers need to understand how freight moves and where inefficiencies exist to develop the best policies, plans, and investments that support freight movement. Improving freight movement has direct and positive effects on the national economy, and may also provide environmental and safety benefits. For over a decade, the Federal Highway Administration (FHWA) has led the development of freight data and approaches to better measure and plan for freight. For example, the FHWA has identified freight data by working with the trucking industry to obtain an onymized truck probe data, which is used to understand speeds and reliability and identify bottlenecks on the Nation's highways to help improve freight performance. The FHWA has assisted States and MPOs identify freight needs on the Nation's transportation network. As the focus on freight has grown in the past decade, the FHWA has worked to coordinate data, freight analysis, and planning methods which help decision-makers understand where needs are greatest.

Improving the state of practice is important for State DOTs and MPOs that have varying levels of experience and capabilities in freight performance measurement, data capture, policy development, and planning. Many agencies are familiar with performance measurement, such as the congestion management process or transit service planning, but may not be as familiar with freight performance measurement. Integrating performance measurement across the areas of transportation operations, planning, programming, and evaluation means developing innovative new practices for many agencies (Florida Department of Transportation [FDOT] 2014). Many States and MPOs have little experience with freight programs necessary to comply with Moving Ahead for Progress in the 21st Century (MAP-21) and Fixing America's Surface Transportation (FAST) Act requirements. This primer gives States and MPOs the tools necessary to be consistent in basic, yet meaningful, measurement practices.

Organizations such as the FHWA, the American Association of State Highway Transportation Officials (AASHTO), MPOs, State DOTs, and the National Cooperative Freight Research Program (NCFRP) have conducted a significant amount of research providing guidance in the establishment of performance measures. The research reveals several common challenges in the development of freight performance measures. A major challenge is identifying exactly what the public sector should measure to best support the economy and balance other policy priorities such as the environment, safety, and energy. Additionally, this research identifies challenges in understanding how freight moves from origin to destination and across several modes of transport. Other challenges include the lack of multi-modal data and undefined and inconsistent approaches to measurement.

Public and private stakeholders agree that the efficient movement of freight is critical to supporting and advancing the Nation's global economic competitiveness and environmental stewardship. Population growth and the anticipated growth in freight movement over the next 20 to 30 years will worsen congestion on an already congested transportation network, hindering the efficient movement of freight. By focusing on performance measurement and management, public and private freight stakeholders can identify the best means in which improvements can be made to the efficient movement of freight.

WHY MEASURE ASPECTS OF FREIGHT SYSTEM PERFORMANCE?

The United States is home to the world's largest economy and possesses one of the largest freight systems in the world. The U.S. freight system comprises over four million miles of public roads, 140,000 miles of railways, 360 commercial airports, and 12,000 miles of marine highways. Additionally, the U.S. freight system is supported by trucking firms, railroad companies, maritime companies, aviation companies, and the public agencies that serve and regulate them. Given the enormity of the freight system and the number of public and private freight stakeholders, there is interest in freight performance measures as a tool to better understand the relationship between efficient freight movement and the economy, environment, safety, and sustainability.

Trucks and rail transport nearly 70 percent of all freight tonnage in the United States. The total tonnage of freight moved in the United States is expected to increase by over 50 percent by 2040. To accommodate the increase in freight demand, more trucks will be needed, but adding more trucks to an already congested road network will worsen mobility. Partnerships within the freight community will foster innovative solutions that reduce congestion safely and efficiently. Freight performance measurement and freight planning tools are vital to understanding and addressing ongoing and future congestion concerns.

While some State DOTs and MPOs have recently begun measuring freight system performance, successful and effective implementation of a performance-based system has not been widely achieved. The U.S. Department of Transportation (USDOT) has been adhering to the Government Performance and Results Act of 1993, which requires development of strategic plans, annual performance plans, and annual performance reports, since its adaptation. The FHWA began developing freight performance measures in 2002 and continues to improve and refine these measures. Today, government agencies are held to a high standard of performance and transparency about publicly available information.

Recent MAP-21 and FAST Act legislations call for more aggressive performance measurement strategies. MAP-21 Section 1115 "National Freight Policy" requires the development or improvement of tools to evaluate and enhance transportation system performance and strategically target the investment of Federal funds. Section 1203 requires the Secretary of Transportation to establish freight performance measures that must be submitted by all States and MPOs. The FAST Act implemented a freight funding program and freight formula program that will require freight plans as part of eligibility for program funding. These plans must demonstrate a link to performance of freight flows and must describe the policies and programs States use to support freight. In response to the Federal legislation, the FHWA Office of Freight Management and Operations has advanced several research efforts to improve freight measurement and to develop multi-modal measurement systems for freight fluidity in cooperation with a variety of stakeholders. Freight-specific performance measures assist in identifying needed transportation improvements, monitor their effectiveness, and establish priorities for freight transportation investments. This information is important for use in freight planning, project development, investment planning, and other needs (Refer to Appendix A for more detail on past and current Federal legislation.).