Posts Tagged ‘fuel tax’

ANSWER: Do bicyclists’ pay for roads?

Wednesday, June 6th, 2012

You’ve probably read it before, often in the comments sections of the Free Press and Detroit News – cyclists don’t pay for roads, motorists do.

Of course that includes the assumption that because one group pays for something, the other can’t use it. Like schools. Residents, businesses, and even the DNR pay school taxes for children to… oh wait… bad example.

It also assumes all cyclists aren’t motorists at other times.

Taxpayers subsidize road funding

But the reality is everyone pays for roads. Yes, motorists pay registration fees and fuel taxes, but they only cover a portion of the road funding.

At the federal level, a 2007 study found that motorists fees and taxes cover 51% of road costs nationwide. With Congress unwilling to increase the federal fuel tax, inflation has eaten up a third of its buying power over the past 19 years. The result is Congress has been adding general tax dollars to the transportation fund for years to close the gap.

And now Governor Rick Synder is doing the same. The Free Press reported that the Governor wants to put $110 million in general tax dollars into road funding. Like Congress, a majority of state legislators don’t want to raise motorists’ fees to cover road costs.

Any guesses where the ARRA stimulus funding for transportation came from? It wasn’t the federal fuel tax.

Free public parking. Minimum parking requirements for developers. Public lighting. Our billion dollar combined sewer overflow issues exasperated by roads and parking lots. Who pays for those? Everyone.

Of course most of our road right-of-ways were acquired and initially improved well before state (1920s) and federal (1932) motorists fees were created. In fact the movement to improve roads, the Good Roads Movement was led by bicyclists.

Bicyclists subsidize motorists

The Victoria Transport Policy Institute takes this discussion a step further, taking a comprehensive look at road funding and all transportation costs.

From their report, Whose Roads? Evaluating Bicyclists’ and Pedestrians’ Right to Use Public Roadways:

Although pedestrians and cyclists do not pay special road user fees, they do help pay for the sidewalks, paths and roads. Only about half of roadway expenses are financed by user fees. Half of all roadway costs are financed by general taxes, which people pay regardless of how they travel, and this portion is increasing. Although a major portion of highway expenses are financed by motor vehicle user fees, they fund only a small portion of local roads and traffic services. Because they are small and light, pedestrians and cyclists impose much smaller roadway costs per mile of travel than motor vehicles. Motor vehicle use also imposes a variety of external costs, including parking subsidies, congestion, uncompensated crash and environmental damages. Because they tend to travel fewer miles per year, they impose far lower total costs per capita than motorists. As a result, people who drive less than average tend to overpay their fair share of transport costs, while those who drive more than average underpay. As a result, pedestrians and bicyclists tend to subsidize motorists.

Final Answer

Bicyclists not only pay their fair share for roads, they help subsidize motorists.

Possible changes for Michigan road funding

Wednesday, October 26th, 2011

Here are just three potential changes which could greatly affect road funding — including bike funding — throughout Michigan.

The Good

According to Crain’s Detroit Business, Governor Rick Synder will call for changes to how Michigan collects tax revenues on motor vehicle fuel. Rather than collect a fixed amount per gallon sold at the pump, he is proposing a percent rate on the wholesale fuel cost. While it won’t raise taxes initially, the total taxes collected will increase with inflation and fuel price increases.

It makes sense to us.

Getting the state legislature to increase the fuel tax, something that hasn’t happened in 14 years, is difficult. The Governor’s proposal removes the need to vote on any tax increases.

The Bad

According to the Spinal Column newspaper, State Senator Howard Walker, a Republican from Traverse City, also wants to eliminate fuel taxes at the pump. He wants to replace the lost tax funding by raising the state sales tax by 1%.

That’s right. Rather than have motorists pay for roads, everyone would.

Those who drive more, say perhaps people in northern parts of the state, would pay less for their roads while those who drive less or not at all would pick up the tab. This proposal would subsidize driving more than we already do.

According to a recent national study, only 51% of road costs are paid by road users. This drop that percentage further with the difference coming from general tax sources.

The Ugly

The Washington Post has this article outlining the very real possibility that Transportation Enhancement funding could be stripped from the next federal transportation bill — or at least made optional at the state level. Enhancements represents about 2% of the total transportation bill.

Losing Transportation Enhancement funding would be devastating to bike facilities development in Michigan and across the U.S..

This is a primary source of funding for on-road improvements, like the 16 miles of new bike lanes in Southwest Detroit. This funding also supports trail development such as the Detroit RiverWalk and Dequindre Cut. And finally, it’s also used for streetscaping which improves walkability while often providing bike parking.

While cyclists and others have banded together to fight off prior attacks on this funding, times are different.

Please contact your Congressperson to let them know we cannot lose Transportation Enhancements.


Detroit Bike Shorts for June 7th

Tuesday, June 7th, 2011

Here are various bike-related updates from around the state and Metro Detroit area —

Model D Speaker Series: Urban Mobility

If you missed this event, don’t worry. Jason Rzucidlo has a nice writeup with photos.

Of course, Model D also covered the event.

Marja Winters, deputy director of the city’s Planning and Development department, said non-motorized transit options are an essential component to the mayor’s Detroit Works Project. Credit the growing movement across the country to urban areas, often for the diversity of options a city affords. “The quality of place is becoming the number one determining factor,” she said. “And ranking high in the decision-making process is the notion of alternative forms of transit.”

We probably would not have heard similar quotes from Detroit’s planning department just a few years ago. This really signals the great deal of progress and increased awareness that has happened during that time.

Bicycle Friendly State rankings

Michigan continues to drop in the state rankings developed by the League of American Bicyclists. The Mitten state is now ranked 22nd and was given a “D”.

This 10 spot drop since 2008 is likely attributable to new ranking criteria and the lack of progress in key areas — progress that other states have made. Michigan received an “F” score in the categories of Infrastructure, Evaluation & Planning, and Enforcement.

Ride challenge for MDOT Director

With the U.S. Secretary of Transportation Ray LaHood biking to work yesterday, we suggested MDOT’s Director Kirk Steudle could do the same via Twitter.

@michigandot OK Director Steudle. You’re next and please post pics

MDOT responded with “I forwarded your tweet to Dir. Steudle to let him know. Thanks! ”

GM’s Akerson calls for fuel tax increase

The unwillingness in Washington DC and Lansing to increase fuel taxes has helped led to a transportation funding crisis. (Yeah, sprawl and the lack of regional planning in Metro Detroit are factors as well.)

Bill Ford Jr. has previously advocated for a fuel tax increase. Now, so to has GM’s CEO Dan Akerson according to this Detroit News article.

A government-imposed tax hike, Akerson believes, will prompt more people to buy small cars and do more good for the environment than forcing automakers to comply with higher gas-mileage standards.

“You know what I’d rather have them do — this will make my Republican friends puke — as gas is going to go down here now, we ought to just slap a 50-cent or a dollar tax on a gallon of gas,” Akerson said.

“People will start buying more Cruzes and they will start buying less Suburbans.”

An increased fuel tax can also encourage more people to bike, walk, and use public transit, while providing improved funding.

I-275 Metro Trail

There was a reopening ceremony for a portion of the I-275 bike path on Saturday. We weren’t there, but the Detroit Free Press was. The I-275 path will continue to be expanded northward as the southern portion is rebuilt and reopened. You can stray up to date with the progress by visiting the Friends of the I-275 Pathway on Facebook.

Michigan Airlines Rail-Trail

The Spinal Column is reporting that the Surface Transportation Board has denied a quick abandonment for the rail corridor that many hope will soon become a trail.

STB board members denied Michigan Air-Line Railway’s petition because it didn’t “provide the Board with sufficient evidence regarding the revenues and costs associated with the line, thereby making it impossible to determine what burden, if any, (Michigan Air-Line) Railway incurs in continuing to operate the line.”

Nevertheless, Michigan Air-Line Railway still hopes to get the STB’s approval to abandon the railroad, therefore allowing the trail project to move forward.

“We’re still moving forward with the grant applications,” said Commerce Township Planner Kathleen Jackson. “The NRTF board doesn’t make the grant decision until December, and (Michigan Air-Line Railway) hopes to have an answer by then.”

We do hope this gets resolved prior to the Natural Resource Trust Fund grant decision is made in December. This is the third attempt at getting this grant which will help pay for most of the property.

We’re with Lutz: Raise the gas tax

Thursday, January 14th, 2010

Bob Lutz, the vice chairman of General Motors recently suggested the U.S. begin raising the gas tax as a means for shifting consumers to more efficient vehicles.

“If the rise in gasoline prices is gradual, I think that all of us in the industry would frankly welcome that, because there is nothing more illogical than forcing fuel-saving technology when gasoline is extremely cheap,” he said when asked about any concerns about oil again rising above $80 a barrel.

“You either continue with inexpensive motor fuels and have to find other ways to incent the customer to buy hybrids and electric vehicles, such as the government credits,” he said. “Or the other alternative is a gradual increase in the federal fuel tax of 25 cents a year, which in my estimation would have the benefit of giving automobile companies a planning base, and giving families that own vehicles a planning base.”

Lutz said if a car buyer knew that gas that costs $2.75 a gallon today would likely go to $3 next year and $3.25 the year after that, it would prompt some buyers to say: “You know sweetheart — this time we should go one size down because we know what fuel is going to do.”

Of course the other benefit is it might prompt car buyers to look more closely at bike commuting as well as public transit.

Sure it’s great having the standard article about bike commuting every time there’s a gas price spike, but watching bicycle’s 1% share of trips climb more rapidly would be better.

Lutz isn’t the first to push this. Thomas Friedman has been saying the same.

The two most important rules about energy innovation are: 1) Price matters — when prices go up people change their habits. 2) You need a systemic approach. It makes no sense for Congress to pump $13.4 billion into bailing out Detroit — and demand that the auto companies use this cash to make more fuel-efficient cars — and then do nothing to shape consumer behavior with a gas tax so more Americans will want to buy those cars. As long as gas is cheap, people will go out and buy used S.U.V.’s and Hummers.

There has to be a system that permanently changes consumer demand, which would permanently change what Detroit makes, which would attract more investment in battery technology to make electric cars, which would hugely help the expansion of the wind and solar industries — where the biggest drawback is the lack of batteries to store electrons when the wind isn’t blowing or the sun isn’t shining. A higher gas tax would drive all these systemic benefits.

The same is true in geopolitics. A gas tax reduces gasoline demand and keeps dollars in America, dries up funding for terrorists and reduces the clout of Iran and Russia at a time when Obama will be looking for greater leverage against petro-dictatorships. It reduces our current account deficit, which strengthens the dollar. It reduces U.S. carbon emissions driving climate change, which means more global respect for America. And it increases the incentives for U.S. innovation on clean cars and clean-tech.

Which one of these things wouldn’t we want? A gasoline tax “is not just win-win; it’s win, win, win, win, win,” says the Johns Hopkins author and foreign policy specialist Michael Mandelbaum. “A gasoline tax would do more for American prosperity and strength than any other measure Obama could propose.”

Oh, and while Mandelbaum is at it, he can add another “win” for bicyclists.

Cyclists subsidize Motorists

Tuesday, December 23rd, 2008
Detroit 1905: A Mural at the Detroit Public Library

Detroit in 1905, a mural at the Detroit Public Library. This is 21 years before Michigan's first gas tax.

Most cyclists have heard or read it before: bicyclists shouldn’t have equal access to the roads because they don’t pay for them.

Those making that claim assume that fuel tax and vehicle registrations pay for all their road costs.

They’re wrong.

Perhaps the definitive report comparing the total costs of using the roads is Whose Roads? Defining Bicyclists’ and Pedestrians’ Right to Use Public Roadways by Todd Litman of the Victoria Transport Policy Institute (2004).

Although motorist user fees (fuel taxes and vehicle registration fees) fund most highway expenses, funding for local roads (the roads pedestrians and cyclists use most) originates mainly from general taxes. Since bicycling and walking impose lower roadway costs than motorized modes, people who rely primarily on nonmotorized modes tend to overpay their fair share of roadway costs and subsidize motorists.

The automotive industry sponsored reports in the past have claimed motorists overpay their fair share.  According to Litman, these reports conveniently ignore some substantial road costs.  He concludes:

Virtually all studies that use appropriate analysis procedures conclude that motorists significantly underpay the costs they impose on society (FHWA, 1997; Delucchi, 1998; Litman, 2004a).

Some of those ignored costs are external.  One example is all the free vehicle parking.  All taxpayers and consumers pay for that through higher taxes and higher product costs. ran an interesting article that describes this external cost in greater detail.

To Donald Shoup, a professor of urban planning at UCLA, parking requirements are a bane of the country. “Parking requirements create great harm: they subsidize cars, distort transportation choices, warp urban form, increase housing costs, burden low income households, debase urban design, damage the economy, and degrade the environment,” he writes in his book, “The High Cost of Free Parking.”

Americans don’t object, because they aren’t aware of the myriad costs of parking, which remain hidden. In large part, it’s business owners, including commercial and residential landlords, who pay to provide parking places. They then pass on those costs to us in slightly higher prices for rent and every hamburger sold.

There’s also another great summary of this very same topic on the St. Louis Regional Bicycle Federation web site.