A recently-released study by the Appalachian Regional Commission confirms what Polk folk have known  for a long time – completion of the Appalachian Development Highway System will have a significant impact on economic development. A recent study of the Corridor K segment also came to the same conclusion as part of the local effort to get state funding for the Hwy. 64 improvements.

The ADHS, the first highway system authorized by Congress for the purpose of stimulating economic development, is a 3,571-mile near-interstate grade highway system composed of 31 corridors located in 13 Appalachian states.  The system is approximately 85 percent finished. The study notes that the completion will link the whole system into an integrated network connecting to national markets and trade flows.

According to the study, corridor improvements will produce significant dollar values of travel benefits to individuals and businesses, both within and outside the ARC region.  Total user benefits (travel time, fuel and nonfuel operating costs, and safety) are estimated to be valued at $1.6 billion annually by the year 2020, the hypothesized year of system completion, and grow to $5.1 billion annually by 2035 under a medium-growth scenario.

Completion of the road system will also result in a significant reduction in travel time for personal, business, and long-distance freight trips.  By 2020, the aggregate savings in travel time is estimated to be over 84 million hours annually (equivalent to 303,000 hours daily of travel time saved), which will grow to almost 212 million hours of reduced travel time by 2035. the study does not include personal non-business travel efficiency benefits.

The study notes that improvements in market accessibility for the ARC region will directly lead to increased economic development opportunities for the region.  Accessibility gains were measured at the county level for labor, customer, tourist, buyer, and supplier markets, as well as reduced travel times to seaports, border crossings, airports, and intermodal rail facilities.  

The ARC region is estimated to gain $2.1 billion annually by 2035 in economic activity due to market accessibility gains. Completion of the ADHS also will result in market accessibility improvements for large segments of the ARC region.

According to the study, there will be a significant increase in traffic using largely rural interstates and expressways but adding new capacity will not result in lower total travel times as averge speeds roughly double.

The study points out that 65% of the benefits to freight flows are outside the ARC region, reflecting the long-distance nature of the shipments affected and the national importance of completing the highway system to facilitate goods movement into, out of, and through the ARC region.

Total impacts on the economy of the ARC region result from the direct effects of reduced business-related travel time and costs, along with increased regional growth made possible by market accessibility gains and associated multiplier effects.  These impacts gradually increase over time and by 2035 are estimated to generate approximately 80,500 jobs, $5.0 billion in increased value added per year, including $3.2 billion in increased wages per year for ARC region workers.

The study also looks at the cost of completing the system, estimated at $12.2 billion, versus the benefits that would be derived. “Under all scenarios, including conservative cost and discounting assumptions, completion of the ADHS is expected to result in significant benefits in excess of cost from both the national and ARC regional perspective.” It estimates the value of benefits for travel efficiency would be 2.9 times the cost at the U.S. level and 1.9 times the cost for the ARC region. For the total economic benefits, the value is projected to be 3.6 times the estimated cost. The study notes these benefit/cost ratios are within the range usually found for individual highway projects and appear stronger than those found for many rural corridors because they complete important links in a long-distance network that serves a growing domestic and global trade environment rather than just connecting individual rural communities. In addition, these highway segments provide necessary access and connection to and from isolated, mountainous Appalachian communities, thus providing significant new economic opportunities.

The study concludes that completion of the Appalachian highway system is particularly important for supporting the future economic competitiveness of the national and ARC regional economies.

These conclusions are similar to those of the Corridor K study, which stressed the importance of providing easy access to Eastern seaports as more businesses become a part of the global economy.

The Appalachian Development Highway System was originally designated and funded to help generate economic development in the economically distressed Appalachian region by enhancing access in isolated areas and better connecting Appalachia to the interstate system. With 15 percent of the ADHS yet to be completed, this new study uniquely captures not only the economic benefits (and costs) of completing the remaining segments of the ADHS, but also the network benefits of a fully connected and linked ADHS, including national freight flows benefiting from this major highway system.