PERFORMANCE REPORT

STRATEGIC AND ORGANIZATIONAL GOALS
GLOBAL CONNECTIVITY STRATEGIC GOAL

FACILITATE AN INTERNATIONAL TRANSPORTATION SYSTEM THAT PROMOTES ECONOMIC GROWTH AND DEVELOPMENT

The transportation sector accounts for more than 10 percent of the U.S. Gross Domestic Product, behind only housing, food and health care. The transportation sector moves goods and people, employs millions of workers, generates revenue, and consumes materials and services produced by other sectors of the economy. The Department of Transportation promotes economic growth and development domestically but also works to ensure that the U.S. interests are competitive in the international market.

The U.S. Department of Transportation leveraged $1,430 million to promote
competition and economic development within the U.S. and internationally.

Key Performance Areas

Strategic outcomes from the DOT Strategic Plan are indicated in blue and FY 2008 results for key DOT performance measures are marked to indicate Met Target () and Did Not Meet Target ().

Efficient Movement of Cargo Safer, more efficient and cost effective movement of passengers and cargo throughout the international and domestic transportation systems, including U.S. ports of entry, modal and intermodal supply chains. Percent of days in the shipping season that the U.S. portion of the St. Lawrence Seaway system is available. Number of freight corridors with an annual decrease in the average buffer index rating. Travel time reliability at NHS border crossings.	Enhanced Competitiveness Reduce barrier to trade in transportation goods and services. Enhanced competitiveness of U.S. transport providers and manufacturers in the global marketplace. Number of potential air transportation consumers in international markets. Cumulative number of technology/information agreements that promote the U.S. highway transportation industry.
International Leadership and Standardization Sustained international leadership in promoting U.S. transportation policies. Harmonized and standardized regulatory and facilitation requirements in the international arena. Number of new or expanded bilateral and multilateral aviation agreements completed.
Expanded Opportunities Expanded opportunities for all businesses, especially small, women-owned and disadvantaged businesses. Percent share of the total dollar value of DOT direct contracts that are awarded to woman-owned businesses. Percent share of the total dollar value of DOT direct contracts that are awarded to small disadvantaged businesses.

2008 Performance Highlights

• DOT initiated Corridor Development Agreements addressing Federal and state commitments on financing, planning, and design, environmental process, construction, operations, and maintenance.
• More than $560 million was funded for state use on Coordinated Infrastructure projects in border regions to make improvements and construct highways and related safety and enforcement facilities related to international trade.
• DOT has successfully negotiated important new agreements with Australia, Croatia and Kenya that extended Open-Skies benefits to an additional 63 million potential aviation consumers.

More Efficient Movement Of Cargo
FY 2008 Enacted Funds: $960 Million

Maritime Trade System

The binational St. Lawrence Seaway is the international shipping gateway to the Great Lakes, connecting the heartland of North America with the world. Commercial transportation on the Great Lakes St. Lawrence Seaway System serves as competition to other maritime trade routes as well as other transportation modes, which benefits the nation in lower consumer prices of finished goods and raw materials, and helps to reduce roadway and railway congestion-each Seaway-size vessel carries roughly 25,000 metric tons, the equivalent of 870 tractor trailers.

Commercial trade on the Great Lakes Seaway System impacts 150,000 U.S. jobs, $12 million per day in wages, $9 million per day in business revenues by firms engaged in trade, and provides approximately $2.7 billion in annual transportation cost savings compared to competing rail and highway routes. Almost 50 percent of Seaway traffic travels to and from overseas ports, especially in Europe, the Middle East, and Africa.

Performance Measure Percent of days in the shipping season that the U.S. portion of the St. Lawrence Seaway system is available
	2005	2006	2007	2008
Target	99.0	99.0	99.0	99.0
Actual	99.7	99.0	99.4	98.8
Associated FY 2008 Funding - $18.0 billion

FY 2008 Results. For FY 2008, DOT's Saint Lawrence Seaway Development Corporation (SLSDC) narrowly missed its annual performance target related to St. Lawrence Seaway availability. During the fiscal year, the SLSDC recorded an availability rate of 98.8 percent, 0.2 percent below its annual goal. An analysis of system non-availability during FY 2008 indicates that the most common causes were weather and vessel-related incidents.

• Weather-related delays totaled 45 hours, 13 minutes of the total 84 hours, 35 minutes of delays or 54 percent. These weather delays are caused by poor visibility, high winds, fog, and other winter weather conditions that are significant enough to deem waterborne transportation unsafe.
• Vessel incidents in FY 2008 accounted for 20 hours, 38 minutes of delays, or 24 percent. Vessel incidents involve ship operations, and are usually caused by human error on the part of a vessel's crew. Incidents also include vessel breakdowns, which are caused by mechanical problems with a vessel. These vessel incidents must be cleared before transportation can resume causing a decrease in the navigation hours available on the Seaway.

Of the remaining factors that cause system non-availability, the SLSDC has the most control over the proper functioning of its lock equipment. During FY 2008, there were 11 hours, 37 minutes of delays, related to lock equipment malfunctioning incidents. Lock equipment delays represented approximately two-tenths of one percent of the total navigation time during FY 2008.

FY 2009 Performance Forecast. DOT expects to meet the FY 2009 target of 99.0 percent. Although the Seaway has enjoyed a 99 percent reliability rate over its history, similar results in the future are uncertain with an aging infrastructure that has not been adequately renewed. The Seaway is comprised of perpetual assets, which requires periodic capital reinvestment in order to continue to operate safely, reliably, and efficiently. Yet, the U.S. Seaway infrastructure is approaching the end of its original “design” life, and without sufficient investment in these perpetual assets, it will become increasingly difficult to maintain the future availability and reliability of the U.S. section of the St. Lawrence Seaway. A recent economic analysis concluded that the economic impact of a shutdown of either of the two U.S. locks would range from $1.3-$2.3 million per day, depending on the length of the delay.

This environmentally friendly form of surface transportation handles a combined total of over 1.1 billion short tons of cargo, which is about 23 percent of the ton-miles of all domestic surface transportation traffic. Domestic waterborne transportation contributes $7.7 billion to the gross domestic product annually in the form of freight revenue.

To address this concern and enable DOT to meet the performance target, the SLSDC will begin in 2009 to address the long-term infrastructure renewal needs of the U.S. section of the waterway through its Asset Renewal Program (ARP). The Seaway ARP identifies 50 necessary capital and maintenance investments to be completed over a 10-year period for the two U.S. Seaway locks, connecting channels, operational systems, and other infrastructure assets.

Highway Freight Corridors

A doubling of international trade over the last decade placed a strain on many of the Nation's intermodal ports and gateways and contributed to an increase in traffic congestion. A further increase in freight activity on the Nation's highways is anticipated in this decade due to continued growth in international trade. Traffic congestion hinders freight movement and undermines business productivity and international trade.

The buffer index, a measure of travel time reliability, represents the extra time freight carriers should add to their average travel time in order to ensure on-time arrival, at least 95 percent of the time, for an end-to-end trip along the corridor. The extra time is added to account for any unexpected delay. The buffer index, which is expressed as a percentage, decreases as trip reliability improves.

Performance Measure Number of freight corridors with an annual decrease in the average buffer index rating
	2005	2006	2007	2008
Target	N/A	N/A	5	25
Actual	N/A	3	5	23 *
N/A Not applicable. *Preliminary Estimate
Associated FY 2008 Funding - $469 million

FY 2008 Results. The 2008 target, which was based on having 100 percent, of the corridors, performing above the national average was not met. When compared to 2007, 23 of the 25 corridors showed a decline or no change in reliability rating. Based on preliminary data, the national buffer reliability index for all 25 corridors measured was 25 percent. During this same reporting period, the average travel speed for the 25 corridors was 55 miles per hour, and no corridor had a decline in average annual speed greater than 1 mile per hour.

FY 2009 Performance Forecast. Continued integration of freight professional capacity into the organizational structure of States and Metropolitan Planning Organizations (MPO) suggests a growing focus on efficient freight movement as key to overall transportation system performance. Under this scenario, the FY 2009 target will likely be met.

The Freight Analysis Framework (FAF) provides current and forecast data on the volume of freight and truck movements on the U.S. transportation network. The information created by FAF is used to identify significant freight corridors in need of attention, now or in the future, to maintain or improve the level of service provided by these roadways. The Freight Analysis Framework, an analytic tool used extensively in both the public and private sector, was recalibrated using data from the 2002 Commodity Flow Survey and integrated with key international gateway data. In addition, FHWA updated FAF mapping of the highway network with 2002 freight flows, generated forecasts of freight movement to 2035, completed provisional estimates for 2007, and performed analyses in support of responses to network disruptions such as the closure of I-5 in Washington due to storms.

Promoting Corridors of the Future

The Corridors of the Future Program (CFP) is making a significant contribution to the Nation's transportation system through the establishment of comprehensive, multi-jurisdictional approaches that will be vital for the competitiveness of the United States. Since the transportation system that supports the economy rarely stays within political boundaries and a large percentage of the value and tonnage of freight moves across State, regional or national boundaries, the CFP multi-jurisdictional approach allows transportation agencies to address congestion from a national/regional perspective.

In FY 2008, the DOT initiated the development of Corridor Development Agreements (CDA) that address the commitments of all Federal and State parties to the Corridor with respect to the financing, planning, and design, environmental process, construction, operations, maintenance, and other components of the Corridor. A CDA also identifies the specific objectives and priorities of the Corridor along with performance measures that would be used to evaluate success in achieving these objectives. The DOT and States finalized all seven agreements before the end of 2008. USDOT has allocated discretionary funding to a few projects along the Corridors for projects that will advance the Corridors and objectives under the CDA. In FY 2009, the coalitions will implement the initial CFP objectives and the DOT will continue to provide assistance in advancing the Corridor concept and priorities identified by the CFP coalitions.

Border Crossing

Trade using surface transportation between the United States and its North American Free Trade Agreement (NAFTA) partners Canada and Mexico was $74.1 billion, or 6.6 percent higher in June 2008 than in June 2007. Border delays and border crossing time reliability are an important concern for public agencies, travelers and those involved with or affected by international travel and trade.

FHWA currently collects travel time data for five U.S.-Canada land border crossings across Washington, North Dakota, Michigan and New York. More than 50 percent of all U.S. inbound truck traffic crossed at these five land crossings in 2007. Inbound and outbound crossing times were measured for commercial trucks moving within two miles of the border crossing area.

Performance Measure Number of U.S. border crossings with an increase in operational reliability
	2005	2006	2007	2008
Target	N/A	N/A	N/A	5
Actual	N/A	N/A	5	4 *
* Preliminary estimate
Associated FY 2008 Funding - $18.0 billion

FY 2008 Results. Based in part on the increased level of trade between the U.S., Mexico, and Canada and the complexity of working across border organizations on projects and initiatives, DOT did not meet the FY 2008 target based on the preliminary estimate.

FY 2009 Performance Forecast. The U.S. Customs and Border Protection, U.S. DOT, Canada Border Security Agency, and Transport Canada will engage in activities to jointly address border delay and congestion. Specific activities will include; wait time measurements, establishment of delay measurement and standards; sharing of research and study results, and enhancing information sharing, communications and coordination. From these efforts, transportation agencies will have better information to disseminate to the traveling public, have improved information to support development traffic management strategies, and have better information to plan for future transportation needs.

In addition, the United States-Canada Transportation Border Working Group and U.S.-Mexico Joint Working Committee will continue to coordinate infrastructure improvements at or near the border, facilitate discussion of the role of ITS and other technology in improving the efficiency of goods and people movement across the United States-Canada border and work with border stakeholders to encourage consideration of technology and operations solutions for common border problems including traffic congestion. Under this scenario, the FY 2009 target will likely be met.

Reducing Border Crossing Delay

Through FY 2008, more than $560 million in projects was funded through the Coordinated Infrastructure program. States use these funds in a border region to make improvements to existing transportation and supporting infrastructure, and construct highways and related safety and safety enforcement facilities related to international trade. They also undertake operational improvements including those related to electronic data interchange and use of telecommunications, modify regulatory procedures, and coordinate transportation planning, programming, and border operations with Canada and Mexico.

The DOT implemented a Transportation Border Congestion Relief (TBCR) program as part of the Transportation Secretary's Congestion Initiative. The TBCR program is specifically designed to facilitate and accelerate transportation-related capacity and operational improvements at international land border crossings. In September, the DOT announced several new border congestion-relief projects including the Otay Mesa East Port of Entry in San Diego, CA, and the Cascade Gateway Expanded Cross-Border Advanced Traveler Information System in Blaine, WA.

Harmonized and Standardized
Regulatory and Facilitation Requirements
FY 2008 Enacted Funds: $58 Million

New and Expanded Agreements

Bilateral Aviation Safety Agreements (BASA) promote aviation safety and environmental quality, enhance cooperation, and increase efficiency in the civil aviation system. The agreements are based on recognized comparability of U.S. and foreign systems for approval and surveillance of the aviation industry. By building a network of competent civil aviation authorities and concluding agreements with additional countries and/or regional authorities, FAA increases safety and competitiveness globally. Improved global understanding of U.S. safety regulations, processes, and procedures leads to better international regulatory oversight and evens the market by holding more international players to comparable standards.

Performance Measure Number of new or expanded Bilateral and Multilateral agreements competed
	2005	2006	2007	2008
Target	2	2	3	2
Actual	2	4	3	4
Associated FY 2008 Funding - $58 million

FY 2008 Results. In FY 2008, FAA exceeded its performance target, concluding four new or expanded BASAs that will facilitate an increase in the ability to exchange aviation products and services thereby expanding opportunities for the global aviation industry.

• We completed negotiations with South Korea for one Executive Agreement and one BASA Implementation Procedures for Airworthiness (IPA). Both documents were signed at the 2008 Singapore Air Show. The BASA IPA allows the FAA to request technical assistance from the Korean Civil Aviation Safety Authority related to South Korean suppliers to U.S. manufacturers.
• A revision to update the U.S./Canada BASA IPA was signed in June 2008. The changes include new provisions for Canadian acceptance of rebuilt U.S. engines and FAA-approved alterations data.
• An agreement between the United States and the European Community was signed in June 2008. The agreement provides for streamlined repair station certifications between the U.S. and Europe. When ratified, the agreement will also allow more European companies to apply for FAA design approvals.

FY 2009 Performance Forecast. We are currently updating the FAA Flight Plan and do not expect to conclude any new or expand existing BASA Executive Agreements or Implementation Procedures in FY 2009, and we have not set a target for this performance measure in the next fiscal year. We are continuing to lay the groundwork for future BASAs with countries experiencing aviation industry growth such as India.

Enhance Competitiveness
FY 2008 Enacted Funds: $400 Million

International Air Transportation Market

Since the 1940s, international air transportation has been subject to restrictive bilateral agreements that limit price and service options and artificially suppress aviation growth. DOT's policy is to negotiate bilateral and multilateral agreements to open international air travel to market forces, thereby removing limitations on the freedom of U.S. and foreign airlines to increase service, lower fares, and promote economic growth. These Open Skies agreements have made it possible for the airline industry to provide the opportunity for better quality, lower priced, more competitive air service in thousands of international city-pairs to an increasing portion of the world's population.

Performance Measure Number of potential air transportation consumers (in billions) in international markets traveling between the U.S. and countries with open skies and open transborder aviation agreements
	2005	2006	2007	2008
Target	1.53	2.99	3.05	3.85
Actual	2.97	3.01	3.83	3.94
Associated FY 2008 Funding - $2.0 million

FY 2008 Results. DOT exceeded its performance target for FY 2008. DOT has successfully negotiated over 90 Open Skies agreements, including important new agreements in FY 2008 with Australia, Croatia and Kenya that extended Open Skies benefits to an additional sixty-three million potential aviation consumers.

FY 2009 Performance Forecast. DOT expects to meet the target of 3.99 billion potential aviation consumers for FY 2009. To accomplish this task we will continue ongoing efforts to conclude Open Skies agreements with important aviation trading partners such as Armenia, Israel, Laos and Vietnam.

Industry Agreements

Increasingly, the DOT and FHWA provide direct support for U.S. foreign policy priorities and initiatives, especially expanded opportunities and access for U.S. transportation industry. Currently, the Agency is providing technical assistance to countries such as Iraq, Kuwait, China, Brazil, and Argentina, thereby expanding opportunities for the U.S. private sector. Through the International Scanning Program in cooperation with the American Association of State Highway Transportation Officials and international partnerships, new technologies and best practices that were developed elsewhere are more quickly adopted in the U.S., thus enhancing the competitiveness of U.S. transport providers and manufacturers.

Performance Measure Cumulative number of technology/information exchange agreements that promote the U.S. highway transportation industry
	2005	2006	2007	2008
Target	N/A	N/A	3	3
Actual	N/A	N/A	4	4
Associated FY 2008 Funding - $384 million

FY 2008 Results. The FY 2008 target was met. FHWA concluded agreements with Israel, Iraq, and Kuwait and facilitated an agreement between the Russian Republic of Karelia and the State of Tennessee.

International scans of ten countries, including Australia, Belgium, Canada, France, Japan, Korea, Portugal, Spain, Sweden, and United Kingdom were completed on high interest topics including public-private partnerships, older driver safety, and research administration.

FHWA coordinated ongoing distance learning activities for approximately 70 representatives from counterpart agencies including 30 in the Western Hemisphere and 40 in Africa. Public private partnerships (PPP) and Safety are the ongoing program focus. This international technical exchange fulfills Section 506 of the International Outreach Program.

FY 2009 Performance Forecast. The cumulative target for the entire plan has been met and no additional agreements will be targeted.

FHWA coordination and activities continued with European partners, participants in the Border Technology Exchange Program, and counterpart agencies in Korea, China, Japan, and Russia. FHWA anticipates future results during FY 2009 as these programs are ongoing.

Expanded Opportunities
FY 2008 Enacted Funds: $6.1 Million

Expanded opportunities for small businesses, especially women-owned and disadvantaged businesses, serve the economic interests of the United States, both nationally and globally. These small businesses routinely develop, manufacture and distribute quality products to the private sector, but continue to face significant hurdles participating in procurement opportunities with the Federal Government. To give these entrepreneurs a fair opportunity to compete, Congress and the Administration have established procurement goals for the Federal Government. In turn, each DOT Operating Administration (OA) develops targets consistent with legislative mandates and anticipated contracting and subcontracting opportunities.

Performance Measure Percent share of the total dollar value of DOT direct contracts that are awarded to women-owned businesses
	2005	2006	2007	2008
Target	5.1	5.1	5.1	5.1
Actual	6.6	8.4 (r)	10.4 (r)	7.0 *
(r) Revised; * Preliminary estimate
Associated FY 2008 Funding - $2.6 million

Performance Measure Percent share of the total dollar value of DOT direct contracts that are awarded to small disadvantaged businesses
	2005	2006	2007	2008
Target	14.5	14.5	14.5	14.5
Actual	12.7	16.2 (r)	18 (r)	16 *
(r) Revised; * Preliminary estimate
Associated FY 2008 Funding - $2.6 million

FY 2008 Results. Based on preliminary estimates, DOT will meet both of the small business related targets. All of the OAs continue to seek new opportunities to engage the small disadvantaged business community. DOT is one of the few Federal agencies surpassing the government-wide five percent Women-Owned Business statutory goal. The Office of Small and Disadvantaged Business Utilization (OSDBU) continues to work closely with all OAs to ensure that small businesses are afforded maximum practicable opportunities to participate in DOT direct procurement actions. OSDBU provided assistance to the OAs with their acquisition strategies, professional development and access to qualified small businesses. OSDBU also increased technical assistance and participation in outreach events.

FY 2009 Performance Forecast. DOT expects to meet both small business targets by continuing its current efforts and leadership in the field.