Gas taxes are unpopular and insufficient, here are some alternatives

From flailing transit systems to inadequate maintenance, states throughout the country are struggling to adequately fund their transportation infrastructure. Making the problem more difficult is the fact that one of their primary funding mechanisms, the gas tax, is failing to cover added costs. Due to projected revenue decline from increased fuel efficiency and EVs, the political aversion to raising the tax, and looming fiscal cliffs, some state legislatures are beginning to consider how to supplement gas tax revenue to sustainably  fund their transportations systems.

Planning congestion pricing to avoid burdening the vulnerable

Congestion pricing seeks to better manage the capacity of urban highways by shifting some travel away from peak periods in order to improve traffic flow. For drivers who are low-income, have no alternative but to drive at peak times, and would be financially burdened by paying tolls, this has the potential to be regressive and inequitable. However, a new report from the Institute of Transportation Studies at UCLA suggests that the establishment of congestion pricing affords an opportunity to design the system from the ground up in an equitable way. The authors state that, “Congestion pricing can be introduced with a mechanism in place to protect the most vulnerable drivers.”

Ride-hailing services disrupting ambulances and airports

New reports have indicated unanticipated disruptions caused by ride-hailing services such as Uber and Lyft. Previously, SSTI discussed the positive and negative impacts ride-hailing services have on our transportation systems. Although these new reports focus on changes to ambulance services and airport revenues, they highlight again that ride-hailing services are fundamentally changing our transportation systems.

California transportation secretary advocates for life-cycle approach

California’s longstanding principle of relying on locally generated funds and suballocated state fuel taxes to improve the state highway system poses a principal-agent problem: Local funders have every incentive to fund expansions while leaving costly owner-operator responsibilities, including eventual reconstruction, to an increasingly cash-strapped state DOT. This month Transportation Secretary Brian Kelly published an op-ed urging a life-cycle approach that prioritizes system preservation.

Shifting the transit-funding paradigm: Transit finance grows up

Development of creative financing and new revenue sources for transportation projects remains a hot topic in transportation circles. Public-private partnerships exist in highway transportation, often using tolls as the revenue source to attract private investment. Transit P3s, however, remain behind the curve in development of policies and best practices. A P3 proposed for the Purple Line light rail in the Maryland suburbs of Washington, DC, illustrates new opportunities for funding a major capital transit investment with a combination of public and private funding.