Portland street fee: Is the obscure formula that determines what you pay ‘imperfect,’ or plain unfair?

Andrew Theen of The Oregonian writes about transportation utility fees, asking: Portland street fee: Is the obscure formula that determines what you pay ‘imperfect,’ or plain unfair?

I defend them:

Despite the criticism thrown at the street fee plan, David Levinson, a professor of transportation at the University of Minnesota, said many transit observers nationally view street fees as progressive and innovative.

Many cities use property tax revenues or a sales tax to raise money for roads, Levinson said, and the latter is particularly regressive. A street fee, Levinson said, is “at least nominally proportional” to use.

Further, Levinson’s research has found that many cities customize their street fees, adding exemptions for residents who don’t own cars, or charging heavier vehicles for causing more wear and tear.

More precise measurements exist to track how much individual drivers use the roads – think GPS – but transportation experts note such tools would be a tough sell politically due to privacy concerns.

Kelly Clifton and Brian Taylor are also cited. The key I think is the alternative. Even ITE Trip Generation rates, as bad as they are, are better than property taxes as a basis for local transportation funding. They can of course be better.

Robert Poole on Mass Transit Financial Stability.

In the latest edition of Reason’s Surface Transportation News (#128), Robert Poole discusses my CityLab post: How to Make Mass Transit Sustainable Once and For All, as well as some other ideas that are also worth a look.

“… CityLab published a comprehensive piece by David Levinson of the University of Minnesota: “How to Make Mass Transit Financially Sustainable Once and for All.” To introduce the subject, he makes a good case that over the last 40 years or so, transit has been in a state of crisis that we have mostly refused to recognize. “Current strategies have not placed transit on a financially sustainable path,” he writes—and he’s correct. As a long-time transportation researcher, Levinson has thought a lot about this problem, concluding that “transit should be successful and cover its costs,” but to do that it needs to be reconceptualized as a kind of public utility. The rest of the piece sets forth and briefly explains seven key aspects of this model:

  1. Reduce costs by competitive tendering of bus service as done in London;
  2. Increase fares, so that the average farebox recovery eventually exceeds 100% of operating costs (with transit vouchers for the poor);
  3. Require the use of a smart card and encourage seasonal passes;
  4. Cancel money-losing routes unless someone is willing to subsidize them;
  5. Recover future capital costs via land value capture (see NCHRP synthesis 459, “Using the Economic Value Created by Transportation to Fund Transportation”);
  6. Raise capital in bond and equity markets, like other utilities do; and,
  7. Fund transit locally, since its benefits are local.

These are very provocative ideas, and I think they are worth serious consideration, as transit faces the likelihood of declining federal support and massive fleet replacement and infrastructure refurbishment costs in coming decades. And I find it encouraging that Levinson’s piece is part of the CityLab “Future of Transportation” series funded by the Rockefeller Foundation.”