development and maintenance are fundamentally important for Kentucky’s future economic advancement are simple; it includes, but is not limited to, aviation, bridges, dams, drinking water, energy, hazardous waste disposal sites, levees, public parks, roads, schools, solid waste processing plants, telecommunications, and wastewater facilities. Infrastructure is all encompassing and provides a foundation for future economic progress.
The state received a “C-” on the 2019 Report Card on Kentucky’s Infrastructure, which was produced by the Kentucky Section of the American Society of Civil Engineers (ASCE); America’s infrastructure got a grade of “D+” on the most recent ASCE infrastructure assessment in 2017. Generally, the engineers evaluate 16 separate categories from aviation to wastewater according to capacity, condition, funding, future need, operation and maintenance, public safety and resilience. The Kentucky assessment in 2019 examined 10 categories.
The Kentucky Report Card presents three broad areas for improving the state’s infrastructure: an integrative and comprehensive big picture approach to planning that anticipates the future challenges while addressing current needs; a concentrated investment in the multimodal freight network to support the distribution and logistics needs of growing industries; and a recognition that rural communities often lack the financial wherewithal to address vital infrastructure needs—particularly with
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respect to the drinking water infrastructure.
While the ASCE infrastructure report card does not include high-speed internet as one of its elements, broadband accessibility and speed are increasingly viewed as fundamentally important components of a state’s infrastructure. Unfortunately, the data show that Kentucky is lagging in its internet infrastructure, especially in rural areas. The Pew Research Center reported in May 2019 that “roughly two-thirds of rural Americans (63%) say they have a broadband internet connection at home, up from about a third (35%) in 2007… Rural Americans are now 12 percentage points less likely than Americans overall to have home broadband; in 2007, there was a 16-point gap between rural Americans (35%) and all U.S. adults (51%) on this question.”
Surveys of CEOs and consultants who are involved in industrial site selection decisions show that infrastructure considerations play an important role in their decision-making. For example, choosing from a list of 28 different factors, ranging from labor costs to environmental regulations, the single most important factor for respondents to the 2018 Area Development Site Selection Survey was the availability of skilled labor, evidenced by 90.5 percent ranking it as either “important” or “very important.” By comparison, “highway accessibility” ranked third on the list at 87.2 percent.
Maintaining—let alone expanding—Kentucky’s existing infrastructure, whether school buildings or roads, requires a tremendous amount of money. In today’s budgetary environment, finding the necessary funds is challenging. Generating the resources to maintain and expand the state’s basic infrastructure will not only continue to be a challenge, it will also be an important factor in keeping the state economically competitive for all forms of industry.
We combine several expenditure categories into a single catchall to estimate infrastructure expenditures (see page 230); this includes highways, air transportation, sea and inland ports, parking facilities, sewerage, solid waste management, and utilities like water supply, electric power, gas supply and transit. State and local expenditures for infrastructure have steadily increased on a per capita basis (in constant 2018 dollars). When viewed over the 23-year period from 1995 to 2017, Kentucky has a higher percentage increase (26%) than the competitor states (14%) or the U.S. (21%). Kentucky has expended slightly more of its cumulative gross domestic product on infrastructure (3.0%) than the competitor states (2.7%) or the U.S. (2.9%). Despite the state’s past investments, it is clear more are needed to ensure the state has an adequate infrastructure to ensure future economic prosperity.
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An estimated 76.4 percent of Americans 16 years and older drive to work alone, which is near an all-time high. By comparison, carpooling is around 9.1 percent and public transportation accounts for about 5.0 percent. The rest use some other form of transportation, like biking, or work from home. Reflecting both economic centers of gravity as well as the state of the infrastructure network, the map below illustrates Kentucky’s county-level average travel times to work. An estimated 82.1 percent of Kentuckians drive to work alone. Kentucky’s statewide average of 23.3 minutes is less than the U.S. average of 26.6 minutes (based on 5-year pooled 2014-2018 data). The counties in the map are divided into one of three categories: below the Kentucky average; above the Kentucky average but below the U.S. average; and above the U.S. average. Calloway County in Western Kentucky has the lowest average travel time at 16.9 minutes, while Elliott County, located in Eastern Kentucky, is the highest at 39.4 minutes. The Wall Street Journal reported in November 2017 that traffic congestion incurred a $1,400 cost on each driver in the U.S. in 2016 due to wasted fuel, lost time, and decreased productivity (Inrix Annual Scorecard). New York City has an average travel time to work of 36.7 minutes, which is less than Elliott County.
Commuting
Average Travel Time to Work, 2014-2018
(workers 16 years old or older)
Source: American Community Survey, 2018 5-Year Estimate, Table DP03
Minutes
17 to 23 23 to 27 27 to 40
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Ideas, innovation, and intellectual capital form the foundation of the evolving knowledge economy. But Kentucky, like most states, is still centered on making and growing things, extracting and transporting raw materials, and moving people and products to markets and workplaces. Thus, the traditional transportation infrastructure—the road system—is still an essential piece of the economic development puzzle. Around 25 percent of Kentucky’s economy is in goods- producing industries that are highly dependent on transportation. And even as the nation’s economy evolves over the next few decades, the movement of freight along the country’s highways, a quintessential “old economy” activity, will continue to grow. An extensive and efficient transportation system, both now and in the future, can facilitate lower industry production costs and consumer prices, widen access to commodities for businesses and consumers, and broaden the pool of workers for business while creating more job opportunities. The bottom line: roads and road quality still matter. In the figure below, road condition depends on pavement roughness, with rougher roads indicating poorer condition; only a small percentage (4.2%) of Kentucky’s roads are in poor condition.