Do Roads Pay For Themselves? Setting the Record Straight on Transportation ...

[ozbob]

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Do Roads Pay For Themselves? Setting the Record Straight on Transportation Funding

Do Roads Pay For Themselves? Setting the Record Straight on Transportation Funding

2011-01-04
Executive Summary

Highway advocates often claim that roads "pay for themselves," with gasoline taxes and other charges to motorists covering – or nearly covering – the full cost of highway construction and maintenance. They are wrong.

Highways do not – and, except for brief periods in our nation's history, never have – paid for themselves through the taxes that highway advocates label "user fees." Yet highway advocates continue to suggest they do in an attempt to secure preferential access to scarce public resources and to shape how those resources are spent.

To have a meaningful national debate over transportation policy – particularly at a time of tight public budgets – it is important to get past the myths and address the real, difficult choices America must make for the 21st century. Toward that end, this report shows:

· Gasoline taxes aren't "user fees" in any meaningful sense of the term – The amount of money a particular driver pays in gasoline taxes bears little relationship to his or her use of roads funded by gas taxes.

· State gas taxes are often not "extra" fees – Most states exempt gasoline from the state sales tax, diverting much of the money that would have gone into a state's general fund to roads.

· Federal gas taxes have typically not been devoted exclusively to highways – Since its 1934 inception, Congress only temporarily dedicated gas tax revenues fully to highways during the brief 17-year period beginning in 1956. This was at the start of construction for the Interstate highway network, a project completed in the 1990s.

· Highways don't pay for themselves -- Since 1947, the amount of money spent on highways, roads and streets has exceeded the amount raised through gasoline taxes and other so-called "user fees" by $600 billion (2005 dollars), representing a massive transfer of general government funds to highways.

· Highways "pay for themselves" less today than ever. Currently, highway "user fees" pay only about half the cost of building and maintaining the nation's network of highways, roads and streets.

· These figures fail to include the many costs imposed by highway construction on non-users of the system, including damage to the environment and public health and encouragement of sprawling forms of development that impose major costs on the environment and government finances.

To make the right choices for America's transportation future, the nation should take a smart approach to transportation investments, one that weighs the full costs and benefits of those investments and then allocates the costs of those investments fairly across society.

[Stillwater]

Factors taken into account when considering the nett worth of a road construction project.  Fuel excise revenues do not come into the equation. 

Construction cost versus:
1)  Lives saved and road trauma avoided as a result of building a road to a higher standard (expressed as a dollar amount)
2)  The value of lower maintenance costs due to the fact that a brand new section of road replaces a section of poor road with a higher annual maintenance cost
3)  Travel time savings likely to be experienced by motorists using the road
4)  Savings due to less wear and tear on vehicles as a result of a new road being built
5)  Fuel savings (less fuel used) by motorists travelling the section of new road by virtue of a shorter or better alignment.
6)  The economic value of not having the road covered by floodwaters for so-many days a year.

The basis of the article is false.  As it states, there is no link between the revenue raised through fuel excise and the amount spent on roads.  Excise that Australians pay on their fuel goes to federal 'consolidated revenue', which is, if you like, the federal government's general bank account.

[#Metro]

I am going to dissent here and say that while cost is one criterion, it is not the only one.

Imagine if roads DID pay for themselves, all the costs paid for, and maybe even turned a profit.
Should all transport be conducted by road and car then? My answer would be NO.

Financials are but only one criterion. Remember Airtrain turns a profit and it does so by providing the most minimal services that it can.
Taxis turn a profit but they do so by charging high fees and serving "profit-only" areas.

Every good city needs a decent PT network. But on the other hand, the requirement for subsidy of PT should not be used
as a convenient cover to hide waste and inefficiency in the system the results from duplication of service or lack of provision
on strategic lines (core frequent network) or poor revenues generated from "rotten apple" offerings to prospective customers.

The rail "service" is the rotten apple core of the PT network, and it must be fixed.
Frequencies must be increased to 15 minutes all day

It is not an accident that Metro is lobbying the Victorian government for more trains and 10 minute all day frequencies- Metro Trains Melbourne knows that is the only thing that will increase PT patronage and revenues and turn stations into places that can become TODified which shopping, service and recreational opportunities.

The problems of PT, in part, come from PT being run in "welfare mode". Get public transport out of welfare mode and less reliant on the lifeline that government subsidies are (which are only ever set a "sustenance" levels, which is why getting any service improvements is like getting blood out of stones). Policies on car use are also very important here too- I am looking at King George Square car park and wondering if the prices for that are set at market rates...

Some people seem to believe that this is only possible through cuts, which I disagree- while the scrapper is a legitimate part of any PT network (I am sure many would like to feed bus route 88 to the scrapper)- I feel the reasons for high reliance on subsidy is because "rotten apple" quality product is being offered, and we cannot blame people for refusing to pay for something like that.

Increase the quality levels on key routes (core frequent network) and people will pay for it and ride it. Cut back waste and duplication by filling trains by using buses better and cut back some bus routes from directly running into the CBD. Legibility of existing services also cannot be underestimated- many drivers base their perceptions of PT on "worst case" scenarios and the frequency of many services are hidden and obscured by too many route numbers going along a corridor- less routes and marketing/branding of frequent corridors should help fix that one.