Abstract

BONILLA VENTURA, MINERVA LISSETTE. How to Improve Funding Allocation Considering Seasonal Population for Optimizing Transportation Funds. (Under the direction of Dr. William Rasdorf and Dr. Min Liu). The Powell Bill Unit of the North Carolina Department of Transportation (NCDOT) annually distributes a fixed appropriation from the State Highway Fund to participating North Carolina (NC) municipalities to maintain municipal streets through resurfacing and other maintenance activities. Presently, the funds are distributed by a formula allocating 75% of the funding based on municipality population and 25% based on municipality street mileage. However, this formula does not take into account of municipalities that are affected by seasonal population increases which do exist. The work presented in this study seeks to identify the municipalities that experience seasonal population increase, quantify the amount, and assess the effect (allocation shortfall) relative to the current Powell Bill funding allocation formula. This thesis outlines one way to adjust the current allocation formula to more equitably distributed funding. It also provides a better understanding of seasonal population’s impact on municipalities and alternative funding allocation formulas. Based on a literature review of 14 prior studies that define seasonal population it is clear that the definitions of seasonal population vary among researchers. Each definition is based on the use of different components which are linked to the scope of their goals. Based collectively on those studies, this study defines seasonal population as the number of visitors to a municipality who stay between 1 day and up to 6 months in a given year. This study also investigated funding distribution formulas of the 50 State Departments of Transportation (DOTs) to better understand the diversity and the focuses of funding allocations. Out of the 50 DOTs, 11 DOTs distribute funds based only on population and six DOTs perform their distribution based only on mileage. Eighteen states distribute their funds based on both population and mileage. Fifteen based on other categories including needs, county area, local match, revenue programs, and vehicle registration. Based on a study of 10 data sources, we found that the most affordable and reliable data sources are the 2010 U.S. Census Bureau, the 5-Year American Community Survey (ACS), Seasonal Tourism Volumes (STV), and July 1 Population Estimates by the North Carolina Office of State Budget and Management. The data sources evaluated was based on the following criteria: 1. Affordable and reliable: readily available, low-cost or no-cost data reliable for all North Carolina (NC) municipalities. This category includes all four of the data sources listed above. 2. Affordable but not reliable: readily available, low-cost or no-cost data that is neither reliable for all NC municipalities nor is sufficiently detailed to use for an estimation model. This category includes Hotel and Motel Lodging data, Motor Vehicle Count, Crash Data, Water Usage, and Survey Calls. 3. Reliable but not affordable: data that may be available for all NC municipalities but is costly to obtain, impractical to collect, or both. This category includes cellphone data. Five methods to estimate seasonal population based on affordable and reliable data sources were evaluated, and this were the following: Method 1 was developed as a test case with 2010 U.S. Census Bureau data only. Therefore, the results are neither accurate nor do they represent current seasonal population. Method 2 utilized 2010 U.S. Census Bureau data for share of seasonal housing and average person per household. It also used 5-Year ACS (2013-2017) for a number of housing unit total, and STV data for percent of visitors with respect to the peak season visitors. Method 3 used the average person per household in 2017 to replace the average person per household based on 2010 U.S. Census Bureau data used in Method 2. Method 4 utilized only parameters for 2017, including 2017 permanent population, 2017 housing units, and 2017 persons per household. This method did not use any decennial census data and accepted the latest ACS estimates for the seasonal population. Method 5 introduced the municipality’s regional Average Travel Party Size (ATPS2017) which approximated the number of people per household. Unlike Methods 1-4 which rely on local household size to estimate seasonal population, the use of ATPS2017 will lead to a more reliable estimate. Therefore, this study recommended Method 5 for seasonal population estimation. Three funding allocation strategies were developed to address seasonal population’s impact. The first is a Cap Based Allocation, which uses the per capita and per mile values from the most recent year (i.e. $19.56/person and $1,600.17/mile). The new funding allocation for a municipality is the summation of per capita value multiplied by the total population (seasonal + permanent) and per mile value multiplied by the total road mileage constrained within the municipality. To avoid an excessive increase to municipalities which experience high seasonal population but have minimal road mileage, a cap (maximum increase) is assigned to the allocation. For example, a capping policy can be that no municipality should receive a total allocation increase of more than 50% of last year’s allocation. Under the capping policy, no municipality has a funding reduction. The legislature needs to allocate additional funding to support this Powell Bill allocation strategy and the amount depends on the level of capping. The Group Based Allocation recommends dividing all qualified municipalities into 5 groups based on their level of seasonal population percentage increase and then allocates a percentage factor to each group. All municipalities that are in the same group will receive a funding increase of the same percentage from their previous years’ allocation. There are 4 scenarios provided for the Group Based Allocation under the assumption that the total Powell Bill budget remains fixed at its current level or that additional funding is allocated and it is increased. This allows NCDOT administrators to estimate the impact on total budget and funding allocation for each municipality based on the assumption chosen. In addition, NCDOT can also adjust the range for each group and the respective percent factor to see the impact. Under the Need Based Allocation strategy the current Powell Bill funding allocation formula is used unchanged. However, municipalities with a high seasonal population percentage increase (e.g. greater than 50%) can request additional funding if they have a critical need for improving local streets. An NCDOT committee would be formed assigned to evaluate and assess the need and budget. Funding would be allocated based on a priority ranking system considering the amount of structural deficiency, mileage, budget, social and environmental impact, and the seasonal population percentage. This approach allows NCDOT to help municipalities with high seasonal population impact to improve local street conditions based on their need. This study also investigated the impact of heavy military equipment travel on local streets. Based on interviews with 2 military officers and literature reviews, it was found that military vehicles do not exacerbate damage to local streets. Military bases follow local laws on vehicle weight limits. Heavy military equipment is designed with multiple axles which distribute loads to avoid potential street damage. © Copyright 2020 by Minerva Lissette Bonilla Ventura All Rights Reserved How to Improve Funding Allocation Considering Seasonal Population for Optimizing Transportation Funds by Minerva Lissette Bonilla Ventura A thesis submitted to the Graduate Faculty of North Carolina State University in partial fulfillment of the requirements for the degree of Masters of Science