Funding of Road Infrastructure
Responsibilities and Funding of Road Infrastructure
While the overall responsibility lies with the federal level, the states administer the federal
roads, i.e. They carry out the project planning, construction and operation on behalf of the
federal level through their administrative bodies. The federal level retains the authority to
control and issue instructions to the states and has the financial sovereignty in the investment
decisions. Figure 2 depicts the general division of responsibilities in road planning and
construction in Germany. Besides the federal roads, the states also plan and operate state
(trunk roads) (Landesstraßen) within their own jurisdiction in consultation with the regional
level and other stakeholders.
Beckers et al. (2005) state in their analysis of the German Motorway procurement system a
shortage of investments as a result of tight public budgets, inefficiencies of resource
allocation due to the quota system in the project selection, delayed planning processes
because of the administrative setup between federal and state tiers, and inefficiencies in the
planning and construction processes. The division of power between federal level and states
for the procurement of federal roads has been further analysed by the President of the Auditor
General’s Office in Germany with respect to its economic efficiency (Engels, 2004). The
conclusion of the matter is that there are growing problems in particular regarding two issues:
Firstly, the system of federal roads was originally designed for long-distance traffic but
carries a considerable amount of regional traffic today, specifically on the highways. Besides,
many highways have been converted by the states to federal roads which allowed them to
claim federal funding. In the planning process, the bottom-up procedure leads to inefficiencies
due to the assessment of more than 1500 single projects which are proposed by the different
bodies. Proposals have been made to substitute this by a more strategic approach focussing on
the federal planning objectives (see e.g. Wissenchaftlicher Beirat, 2000, Gühnemann et al.,
1999, pp. 364-367).
Secondly, since the road administration and thus, considerable decision
making power on many aspects of the road procurement is carried out on the state level on
behalf of the federal government, the federal level lacks information and control over the
efficiency of the process. Therefore, Engels (2004) proposes that all federal trunk roads be
transferred to the full responsibility of the states and that a federal road administration be
established with responsibility for the motorways which would remain a federal liability.
EU Forecast
euf:ba18f:8/nws-01