Where the heck are we gonna get money for roads and transit?
This first week of class we focused on the history of (primarily American) transportation, as well as looking at how policy and finance affect transportation systems and networks at the local, state, and federal level. Following the money that supports transportation systems is tricky as I found in our readings. As someone who does not come from a transportation background, my initial assumptions about urban transportation systems was that they were primarily funded and operated at the city, county, or metro level. While this is true to some extent, from the readings this week it is clear that the way urban transportation operates is far more complex and is also highly dependent on state and federal policies, politics, and financing. I think this is in part because roads and transit lines are connectors and have to connect not only our inner urban core, but also to regional nodes and even state and federal highways. This means that several jurisdictions/governments/administrations must coordinate in order to achieve connectivity. Not only that, but as we saw in our readings by Shank and Lewis and Puentes and Prince, local transportation agencies often struggle to fund maintenance and improvement projects through fares alone, and they rely on state and federal funding, generally in the form of grants or low-interest loans, to help pay for these types of projects. Concerningly, the federal government has not increased their user-based revenues (ie gas tax) since the 90’s and the feds’ ability to fund surface transportation is stagnating and potentially declining. This is in part due to the fact that our average vehicle miles traveled (VMT) has been going down since the mid-2000s and fuel efficient cars are becoming more common. These are not bad things of course, except that we have come to rely on the gas tax to fund surface transportation projects, and with lower gas usage comes less money. If federal funding for transportation projects is not going to increase, it means we will be forced to increasingly rely on state or local funding for transportation investment, which doesn’t seem like it would be a bad thing (especially in the current political dumpster fire), except that state and local governments are facing the same challenges that the federal government is facing in terms of obtaining revenue. State revenues from gas tax have also plateaued, and often urban areas receive less money from the gas tax compared to rural or exurban communities.
So where are we supposed to get funding for urban surface transportation projects? Joshua Schank and Paul Lewis suggest that the federal government needs to incentivize state and local governments to seek alternative forms of funding, such as a sales tax for transportation (rather than gas tax). They also see options like toll roads/bridges/highways as a viable option for revenue generation, though it would require congress to expand their current eligibility criteria and perhaps provide other incentives to overcome what would predictably be some serious public pushback because people just do not like tolls. Schank and Lewis also bring up the idea of the Vehicle Miles Traveled (VMT) fee, which is pretty much what it sounds like- a fee based on how much you travel. This seems similar to the gas tax, but I guess it circumvents a lot of the gas tax problems because it is not impacted by the fuel efficiency of cars. According to Schank and Lewis though, VMT fees are still very controversial and not necessarily politically feasible because of concerns about government monitoring and privacy, and the unfair disadvantage it puts on people who live in rural areas and typically must drive more.
In summation, we rely pretty heavily on federal funding for surface transportation maintenance and improvement projects. But federal funding has plateaued and may even decrease in coming years. Looking for alternatives on the state and local level is imperative, but few easy answers come here either because we often still have to contend with similar economic, political, and public perception issues at the local level that we do at the federal level.
Written by Sachi Arakwa
Edited by Lacey Clark
So where are we supposed to get funding for urban surface transportation projects? Joshua Schank and Paul Lewis suggest that the federal government needs to incentivize state and local governments to seek alternative forms of funding, such as a sales tax for transportation (rather than gas tax). They also see options like toll roads/bridges/highways as a viable option for revenue generation, though it would require congress to expand their current eligibility criteria and perhaps provide other incentives to overcome what would predictably be some serious public pushback because people just do not like tolls. Schank and Lewis also bring up the idea of the Vehicle Miles Traveled (VMT) fee, which is pretty much what it sounds like- a fee based on how much you travel. This seems similar to the gas tax, but I guess it circumvents a lot of the gas tax problems because it is not impacted by the fuel efficiency of cars. According to Schank and Lewis though, VMT fees are still very controversial and not necessarily politically feasible because of concerns about government monitoring and privacy, and the unfair disadvantage it puts on people who live in rural areas and typically must drive more.
In summation, we rely pretty heavily on federal funding for surface transportation maintenance and improvement projects. But federal funding has plateaued and may even decrease in coming years. Looking for alternatives on the state and local level is imperative, but few easy answers come here either because we often still have to contend with similar economic, political, and public perception issues at the local level that we do at the federal level.
Written by Sachi Arakwa
Edited by Lacey Clark
The need to reform our transportation schemes cannot be underscored. The gas tax provides a small share of all the resources needed to maintain our current road network. Take this example from the Portland Bureau of Transportation: according to this bureau only about 20% of their budget comes from road taxes. Their other funding sources include: fees (14%), parking (21%), the general fund (6%), bonds or debt (5%), and the marijuana tax (1%). I believe a tax charging people for the vehicle miles traveled (VMT) and the weight of their vehicle is the fairest taxing scheme. Portland should not have to incur into debt or use the general fund which relies on property taxes to fulfill the needs (real or perceived) of motorists. I believe this scheme is unfair as everyone who owns or rents inside the City of Portland boundary pays property taxes but not everyone owns a motor vehicle. This funding scheme extracts money from those who do not own a motor vehicle and gives it for free to motorists. The VMT and the weight of the vehicle are indicators of how much pavement damage a vehicle causes to the city roads. One metric measures pavement exposure to said vehicle while the other measures the rate this damage is being done. In my opinion the fairest taxing system simply charges people for the amount of a resource they use.
ReplyDeletePortland Bureau of Transportation. (2017). PBOT Funding 2017-18: At a glance.
Retrieved from: https://www.portlandoregon.gov/transportation/article/660484
It is amazing to think the gas tax hasn't been increased since the 90's. According to the Federal Highway Administration, the increase was in 1993 and introduced by Bill Clinton. This increase was only by 4.3 cents!
ReplyDeleteThe point brought up in your post that due to more fuel efficient cars, the gas tax is less lucrative, is exactly why we need to increase the tax itself! Increasing the tax for this reason would be more representative of the amount of cars using the road (not the amount of gas being consumed), as we would generate more money from a raised gas tax.
A second more obvious reason for an increased gas tax is inflation! According to an inflation calculator, four cents in 1993 is seven cents today.
With a gas tax doing very little, this acts as an incentive for private markets to pick up the slack. Recently, as I learned from researching the recent e-scooter influx, the electric scooter company Bird is proposing funding bike lines to improve road infrastructure. While this sounds good for the community, offering safer options for cyclists, the infrastructure improvements are direct benefits for the Bird company and their users. As using e-scooters becomes safer, more people will see it as a viable transportation option, increasing ridership and profits for Bird.
I'm new to the concept of "neo-liberalism," but I am wary of private investment in public infrastructure.
The federal government should not be let off the hook for improving roads.
Highway History - https://www.fhwa.dot.gov/infrastructure/gastax.cfm
Scooter Startup Bird Plans to Fund Protected Bike Lanes - https://www.curbed.com/2018/8/2/17641604/bird-scooter-safety-bike-lane
Yes, I totally agree that the gas tax should be raised and its crazy that it hasn't been. I can't say for sure why that is, but my hunch is that like most attempted levies on automobile travel, it is just politically infeasible. As Santiago mentioned, the VMT tax might be an even better option for generating funds for transportation projects because it is not impacted by fuel efficiency, but it is also extremely difficult to get public opinion behind. I'm not convinced that the problem is that the feds want off the hook for improving roads, it is that there is no public support for revenue generating taxes. I am also extremely skeptical of bringing in the private sector to help fund public transportation projects and to be honest a world in which Bird runs our public transit is a horrible dystopia that I do not want to live in. But, joking aside, this type of public/private partnership to fund infrastructure improvements is a very real possibility, especially if the driving public is unwilling to put down some of their own money to fund maintenance.
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DeleteAs I was reading the articles this last week I also wondered what the impact that fuel-efficient and electric cars has had on the gas tax. It would be really interesting to look at the data, specially with the new technology in the past few years!
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