Monday, March 11, 2013

Lisa Schweitzer on Decentralized Transport Funding

Eric Jaffe at the Atlantic Cities wrote a great piece on the opportunities and challenges of decentralizing transport finance. I am quoted:
"I'd expect under a decentralized system we'd see more variation across metropolitan areas," says planner David King of Columbia University. "We don't necessarily have shared needs, or homogenous needs across the country, when it comes to what we need for transportation."
King and others in the decentralization camp note that the federal government frequently gets transport policy wrong. Financial and housing incentives used during the interstate construction era led, in large part, to the sprawl that's crippling metropolitan areas today. There's widespread feeling that federal involvement in transportation has resulted in more roads and rails than America needs, with the prospect of free federal money encouraging questionable projects — such as the Detroit People Mover years ago, and some streetcar lines more recently — that might not have been built with local funding alone.
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"Decentralization of transport finance is happening, and we shouldn't fear it," says King. "It may or may not be better than what we have, but the current system is not sufficiently wonderful that we should fight to make sure it remains."
One of the people who has influenced my thinking on decentralized transport finance is USC's Lisa Schweitzer, who wrote a nice piece in Planners Network a couple of years ago.  From her piece:
For those who would like to see U.S. transit systems expand, the push towards devolving infrastructure finance entirely to states and regions puts the battle for transit funding into familiar territory: the states already provide about $12 billion to transit in U.S. cities, and transit agencies currently spend quite a bit on lobbyists in state houses across the country. Nonetheless, states are in no better budgetary condition than the federal government. 
Such devolution to states and regions may radically alter urban transit funding in significant ways, not all negative. As it is, federal transit spending has been concentrated among a handful of states as transit is primarily an urban service. Given the nature of gas taxes, the federal gas tax could go away and the states where transit is an important issue could (in theory) immediately pass an increase in their state gas tax commensurate to the federal tax, and consumers would pay the exact same amount at the pump. Gasoline buyers in places like California and New York are net donors to other states due to the large amount taxpayers in these states chip in to the federal funds, which then go to pay for roads in other locations. If California or New York or the if the federal gas tax went away, states could increase their state gas tax commensurate to the federal tax, and consumers would pay the same at the pump. If California or New York or other donor states made up for the loss of federal support with higher state taxes, they might actually be better off  loss of federal support with higher state taxes and kept their receipts, their transit operators might actually be better off with devolution.
She then explains that this isn't a certainty--or even likely--and discusses implications for transit.


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