Performance Measures in the Federal-aid Highway Program A National Perspective

1. Performance Measures in the Federal-aid Highway Program � A National Perspective King W. Gee Associate Administrator for Infrastructure Federal Highway Administration Presentation Outline: Context for Performance Measures & Management Performance Management in FY 2012 Budget Proposal Elements & Implications for State DOTs Ongoing Efforts to Advance Performance Management Collaboratively Presentation Outline: Context for Performance Measures & Management Performance Management in FY 2012 Budget Proposal Elements & Implications for State DOTs Ongoing Efforts to Advance Performance Management Collaboratively

3. Example � Mn/DOT Investment plans include highway and other modes and specific district investment plans. The highway investment plan makes the most extensive use of performance measures and performance-based planning approaches, but all plans follow the same basic techniques. The highway investment plan has three time frames (5-year, 10-year, and 20-year)Investment plans include highway and other modes and specific district investment plans. The highway investment plan makes the most extensive use of performance measures and performance-based planning approaches, but all plans follow the same basic techniques. The highway investment plan has three time frames (5-year, 10-year, and 20-year)

4. FY 2012 Budget Proposal: Creates Performance Management Framework Outlines key elements of performance-based program Recognizes need to address performance in national goal areas of: Safety Infrastructure Condition Economic Competitiveness Environmental Sustainability Livability Focuses initially on safety, pavement and bridge conditions Principles: Evolutionary Build from existing data/measures Provide framework for more comprehensive program Acknowledge shared responsibility for goals/target setting Provide accountability Process: Secretary, with input, establishes quantifiable performance measures and national performance goals States work in partnership with FHWA to set state targets Envisions planning process as vehicle to implement performance management Calls on States to report annually on progress in meeting targets Provides additional flexibility when targets are met Requires performance improvement plan when targets not met Principles: Evolutionary Build from existing data/measures Provide framework for more comprehensive program Acknowledge shared responsibility for goals/target setting Provide accountability Process: Secretary, with input, establishes quantifiable performance measures and national performance goals States work in partnership with FHWA to set state targets Envisions planning process as vehicle to implement performance management Calls on States to report annually on progress in meeting targets Provides additional flexibility when targets are met Requires performance improvement plan when targets not met

5. Performance Management Elements - Elements within the framework for highway program performance management Hope to illustrate concepts and to present challenges and opportunities ahead of us General agreement on areas of national interest Currently, greatest challenge/opportunity is in the definition of performance for each of these areas- Elements within the framework for highway program performance management Hope to illustrate concepts and to present challenges and opportunities ahead of us General agreement on areas of national interest Currently, greatest challenge/opportunity is in the definition of performance for each of these areas

6. Performance Management Elements - Elements within the framework for highway program performance management Hope to illustrate concepts and to present challenges and opportunities ahead of us General agreement on areas of national interest Currently, greatest challenge/opportunity is in the definition of performance for each of these areas SAFETY Builds off of Strategic Highway Safety Plans Identifies need to invest in data � Highway Safety Data Improvement Program Provides Accountability: If target is met in previous year, State may transfer up to 50% of HSIP funds to other safety programs If target is not met in previous year, State must use obligation authority equal to prior year HSIP apportionment only for highway safety improvement projects States that do not meet targets for two consecutive years to develop performance improvement plan CONDITION: Performance requirements limited to enhanced NHS Requires risk-based asset management plan Provides Accountability: If State meets targets for 3 consecutive years, it may use apportionments on non-NHS roads States that do not meet targets for 2 consecutive years will be required to develop performance improvement plan - Elements within the framework for highway program performance management Hope to illustrate concepts and to present challenges and opportunities ahead of us General agreement on areas of national interest Currently, greatest challenge/opportunity is in the definition of performance for each of these areas SAFETY Builds off of Strategic Highway Safety Plans Identifies need to invest in data � Highway Safety Data Improvement Program Provides Accountability: If target is met in previous year, State may transfer up to 50% of HSIP funds to other safety programs If target is not met in previous year, State must use obligation authority equal to prior year HSIP apportionment only for highway safety improvement projects States that do not meet targets for two consecutive years to develop performance improvement plan CONDITION: Performance requirements limited to enhanced NHS Requires risk-based asset management plan Provides Accountability: If State meets targets for 3 consecutive years, it may use apportionments on non-NHS roads States that do not meet targets for 2 consecutive years will be required to develop performance improvement plan

7. Performance Management Elements - need consistent definition that can be applied across States Challenge � State�s needing to move away from their established, effective approach to defining performance A consistent view of performance, even for established measures, can be a challenge (example) Opportunity � ability to present and evaluate performance at the corridor, regional and national level - need consistent definition that can be applied across States Challenge � State�s needing to move away from their established, effective approach to defining performance A consistent view of performance, even for established measures, can be a challenge (example) Opportunity � ability to present and evaluate performance at the corridor, regional and national level

8. Performance Management Elements Setting targets and tracking process is a challenge that many State�s have not met. GAO report on performance based planning identified that only 18 States include targets in planning documents where all States include some form of a broad transportation goal. Development of targets is challenging but it is critical in order to tie program commitments and delivery to performance outcomes. Challenge � how do we assess a State�s target in support of a national goal? Opportunity � how can we design our program to focus federal funds on systems of the greatest national interest?Setting targets and tracking process is a challenge that many State�s have not met. GAO report on performance based planning identified that only 18 States include targets in planning documents where all States include some form of a broad transportation goal. Development of targets is challenging but it is critical in order to tie program commitments and delivery to performance outcomes. Challenge � how do we assess a State�s target in support of a national goal? Opportunity � how can we design our program to focus federal funds on systems of the greatest national interest?

9. Performance Management Elements Plan is a commitment from the State/MPO to invest funds with the specific intent to achieve a desire performance result Challenge � State & FHWA � how do we assess the effectiveness of the investment plan � what�s the role for FHWA? Opportunity � the degree to which the plans can be rolled up nationally will provide us a better picture on the impacts on performance.Plan is a commitment from the State/MPO to invest funds with the specific intent to achieve a desire performance result Challenge � State & FHWA � how do we assess the effectiveness of the investment plan � what�s the role for FHWA? Opportunity � the degree to which the plans can be rolled up nationally will provide us a better picture on the impacts on performance.

10. Performance Management Elements - Challenge/Opportunity � track key indicators on a routine basis that can be used to assess to potential in reaching a performance target. Where will this data come from and how will it be accessed? Track impacts on deliver (price increases, extreme weather events) � better understand how to mitigate these risk events. Track quality of projects and their impact on performance. Where does this data come from � what is the federal role?- Challenge/Opportunity � track key indicators on a routine basis that can be used to assess to potential in reaching a performance target. Where will this data come from and how will it be accessed? Track impacts on deliver (price increases, extreme weather events) � better understand how to mitigate these risk events. Track quality of projects and their impact on performance. Where does this data come from � what is the federal role?

11. Performance Management Elements - Challenge - Keeping up with technology while still providing for a consistent, reliable approach to monitoring. Don�t want to stifle innovation so that standardization is maintained. Need to be able to ask �why� � do we have the right information? Do we have the right tools? Example of Blue CRUSH � Memphis Police used predictive analytics to drop crime 31% by proactively allocating resources to get ahead of crime (based on past trends) Challenge � reporting � where is the national data source. Need to assess national vs State vs local data sources � do they tell the same story? If not, why?- Challenge - Keeping up with technology while still providing for a consistent, reliable approach to monitoring. Don�t want to stifle innovation so that standardization is maintained. Need to be able to ask �why� � do we have the right information? Do we have the right tools? Example of Blue CRUSH � Memphis Police used predictive analytics to drop crime 31% by proactively allocating resources to get ahead of crime (based on past trends) Challenge � reporting � where is the national data source. Need to assess national vs State vs local data sources � do they tell the same story? If not, why?

12. Ongoing FHWA Efforts Establish Office of Program Performance Management Build internal capacity to support performance-based program Develop analysis tools and training to assist States/Locals in advancing performance management Facilitate collaboration between highway and transit communities

13. Ongoing FHWA Efforts Continue to work in partnership with AASHTO to advance all elements of performance management More fully develop measures/data/systems in Safety, Pavement and Bridge areas Invest in research in other goal areas Develop methodology to integrate performance management into the planning process

14. FHWA�s Commitment to Performance Management Natural evolution to improve decision making and resource allocation Improves transparency and accountability for federal funds Opportunity to advance performance management practices prior to legislation

15. Recap: Implications for State DOTs Parallel to State Management Framework Tiny Fraction of What is Used � Same Metrics? Consistency Across State Lines Definition of Metrics Methodology of Data Collection Accountability & State Priorities Data Sourcing and Access Analysis, Reporting & Forecasting

16. Thank You!