ALEC Annual State Legislative Leaders Summit

Remarks Prepared for Delivery by
U.S. Secretary of Transportation Elaine L. Chao
ALEC Annual State Legislative Leaders Summit
New Orleans, Louisiana
Wednesday, August 8, 2018

Thank you, Sen. Cassidy for that introduction.

It is good to join so many friends here in New Orleans at the 2018 annual meeting of the American Legislative Exchange Council.  Let me give a special shout out to the eight Alec members from my home state of Kentucky. Mitch sends his best, as well!

Conspicuous on ALEC’s website and business cards are the three principles that helped turn thirteen small colonies into a world superpower – limited government, free markets, and the unique American system of national, state and local government called Federalism.  That’s the original three-step program for maximum freedom, prosperity and opportunity.

Today, I would like to share some thoughts with you today about how the Administration and the Department of Transportation is putting those powerful ideas into practice to strengthen and improve America’s transportation system.

One of this year’s most important achievements for individual freedom and limited government was the President’s success in working with Congress to pass meaningful tax reform. It was based on a fundamental precept: if we want to empower the people rather than the government, let them keep more of the money they earn. 

And the results are clear:

• The economy grew 4.1 percent in the Second Quarter of 2018;
   
• 155 million Americans are working today – the most in U.S. history;
   
• 3.7 million new jobs have been created since the 2016 election; and,
   
• 1.3 million new jobs have been created since the President’s tax cuts for businesses and families went into effect.

Additionally, according to the Department of Labor, the unemployment rate has dropped to 3.9 percent—which is nearly an 18-year low for all Americans.

So, it’s apparent that this Administration’s commitment to economic growth and regulatory reform is having an impact.  Throughout the previous eight years, I heard from job creators that the deluge of government regulations was hampering job creation and economic growth.

Our growing economy also underscores the importance of strengthening our transportation infrastructure – which is one of my three priorities as Secretary of Transportation:

• Safety is number one;
   
• Second, is modernizing our infrastructure to make our economy more productive and improve our citizens’ quality of life;
   
• And third, encouraging new technology and innovation, while addressing the public’s concerns about safety, security and privacy.

This afternoon, I will attend a ribbon cutting ceremony for a project that advances all three of those priorities:  the Belle Chasse [Bell Chase] Bridge and Tunnel replacement project.  The 50-year-old vertical lift drawbridge opens an average of 10 times a day and occasionally malfunctions.  This not only backs up traffic on the highway, it holds up ships and barges transiting the Gulf Intracoastal Waterway.  The new bridge will eliminate this source of delays, and add a safe bicycle and pedestrian path.   The tunnel, which is more than 60 years old, is also showing its age.

This project will be a public-private partnership – the first of its kind in Louisiana.  While public private partnerships seem new, they are widely and successfully used overseas.  And much of our nation’s early transportation infrastructure projects were established with private sector participation.

The project also shows that the Department of Transportation is already putting the Administration’s principles into action, as we:

• empower decision making by state and local government;
   
• encourage participation from the private sector;
   
• streamline project delivery; and,
   
• address the needs of rural America, which have been ignored for too long.

It has made a lot of progress in streamlining project delivery and reducing unnecessary red tape which causes delays and inflates project costs.

On August 15, 2017, the President signed the “One Federal Decision” Executive Order. It directs all federal government agencies to work together to speed up the delivery of new infrastructure, by streamlining the permitting process of complicated, multi-agency projects. As the Department implements One Federal Decision, our goal is less paperwork, less red tape, and more timely improvements that will better protect the environment and our quality of life.

The Department is also a leader in addressing the problem of unnecessary and overly burdensome regulations that do real economic harm.  Last year, the big news was the Administration’s two-for-one regulatory mandate.  For every new regulation, Departments are supposed to eliminate two existing ones.   In Fiscal Year 2018, DOT has already achieved a 14-to-one ratio -- eliminating FOURTEEN regulations for every new one – and we expect that ratio will continue to grow between now and September 30.

As a result of these efforts, the Department is on track to save over $1 billion in Fiscal Year 2018, while advancing safety and innovation. This is compared to the $3.2 billion in annualized regulatory costs imposed on the American public in Fiscal Year 2016 under the previous administration.

Now let me share with you an update on probably the most significant regulatory reform that this Administration is undertaking.

Last March 15th, 2017, the President promised to address the extreme 2012 vehicle fuel economy mandates that impose excessive costs on American consumers, fail to improve the environment, and hurt American jobs. 

The last administration had promised a “midterm review” of fuel economy mandates in 2018. But, it rushed the process shortly before the current Administration took office. Then, on April 2nd, 2018, following the previous administration’s original timetable, the Environmental Protection Agency completed a transparent Midterm Evaluation Process.

And just last week, on August 2nd, 2018, this Administration announced a joint proposal with the EPA to revise the national automobile fuel economy standards.  It provides eight options, including a time-out from increasing the standards.

The new proposal will give consumers greater access to safer, more affordable vehicles, while continuing to protect the environment.  And, it projects potential cost savings to the U.S. economy of up to $500 billion.

A transparent, inclusive process is critical to creating one set of national fuel economy standards that enhances safety and affordability, while maintaining environmental protections.  So, if you have comments on the proposal, let us hear from you! You can access the proposed rule on the EPA website at www.epa.gov, or the NHTSA website at www.nhtsa.gov.

Smaller government, free markets and empowering state and local government is paying dividends in innovation as well.  As you may know, our country is witnessing significant new developments in transportation – automated vehicles and unmanned aircraft systems, or drones.  The department has launched programs that allow private sector firms and local communities to partner on safely testing and refining these technologies.  

On September 12, 2017, DOT published voluntary guidance for the safe testing and integration of automated driving systems: ADS 2.0: A Vision for Safety.   To keep pace with the innovation, work continues on a multi-modal version, AV 3.0.  It will address barriers to the safe integration of autonomous technology for motor carriers, transit, trucks, and infrastructure and other modes, in addition to cars. To ensure ADS 3.0 includes diverse viewpoints, the Department solicited public and industry input.  It held an AV policy listening summit at the Washington headquarters on March 1, 2018.

The Department’s AV policy emphasizes safety and a technology-neutral approach that keeps the government out of picking winners.  Regulations will be as performance-based and non-prescriptive as possible.  The Department will work with States and localities to avoid a patchwork of rules that could inhibit innovation and make it difficult for automated vehicles to cross state lines.  The Department will provide stakeholders with guidance, best practices, pilot programs and other assistance to facilitate integration of AV technologies into the transportation system.  And finally, the Department recognizes that autonomous vehicles will need to have the capability to operate side-by-side with traditional vehicles, in both urban and rural areas.

Innovation is also taking place in the skies.  Our country is witnessing the most significant new development in aviation since the beginning of the jet age – the emergence of unmanned aircraft systems, or drones.

As of last month, there were more than 1.1 million registered drones in the U.S., and nearly 100,000 certified drone operators. They proved their worth in 2017 after Louisiana, Texas, Puerto Rico and the Virgin Islands were battered by hurricanes.  Drones were used for search and rescue missions and to safely and quickly conduct surveys of damaged buildings and infrastructure.  It is vital that we ensure the safe deployment of this technology without stifling innovation.  

To encourage drone innovation, the President directed the Department to launch the “Unmanned Aircraft Systems Integration Pilot Program” on October 25th, 2017. This Pilot Program allowed the private sector and local communities to partner to test the safe operation of drones in currently prohibited conditions, and across a variety of locations and geographies. These include operations over people, beyond line of sight, and at night.

On May 9th of this year, I announced 10 selections for the Integration Pilot Program.

There is another area where the innovative power of the private sector is reaching new heights: outer space.  It may surprise you, but the Department of Transportation oversees commercial space flight.

Six years ago, the U.S. was 3rd behind Russia and China in rocket launches. Today, we are Number One.  The Department is committed to building on this momentum by streamlining and updating its launch and re-entry licensing criteria in accordance with the President’s directive.  That will give commercial space operators the approvals they need more quickly, and help make the U.S. be an even more attractive place for commercial space enterprises.

This is important.  A recent study concluded that the commercial space industry will triple in seven years to $27 billion annually.  If America wins a significant market share of this new frontier in private sector innovation, it could drive economic growth, technical innovation and job creation.

This is an exciting time.  New technology is emerging which can change the way people interact, travel and ship goods.  At the same time, the public has turned toward the time-tested, yet still revolutionary principles of local and limited government, personal freedom and private enterprise.   Our national, state and local governments have a rare opportunity to use those principles to chart a course that that will enable innovation, creativity and economic growth to flourish.  That will, in turn, lead to a bright future of incredible opportunity.

Thank you again.

###