Comments
Roadway pricing, if properly implemented, can improve quality of life, the environment, and the fiscal health of urban areas. But the devil (and the angels) are in the details.
LEXUS LANES - One of the first places in the USA to employ High Occupancy Toll (HOT) lanes conducted a poll. Certainly, affluent people used them more than others. HOWEVER, they were important to some low- and middle-income people as well. For example, you're picking up your kid at day-care. You're stuck in traffic and there's a $20 late fee. It's worth it to pay $5 to use the HOT lane and avoid the $20 late fee. Plumbers, electricians, landscapers, etc. spend lots of time going between jobs. With access to HOT lanes, they can get an additional job each day, more than offsetting the cost.
REGRESSIVE TAX - Except for air and water, nothing is more essential than food. But food isn't free. We pay for food. We pay more for steak than hamburger. BUT, we provide food stamps for low-income folks. We could do the same for transportation. ALSO, low-income folks depend on transit. Transit buses get stuck in traffic. Slow and unreliable transit can cause workers to lose their jobs. Priced roads can help the poor in at least two ways: First, congestion reduction makes buses quicker and more reliable. Second, some of the toll revenues should be used to operate, maintain and improve transit.
BUSINESS COSTS: Roadway prices, paid for deliveries, will be passed through to customers. BUT, lower congestion will reduce delivery times, and this will reduce costs that, in a competitive environment, will also be passed through.
INCENTIVES - Some places (e.g. London) use "cordon pricing." Thus, drivers pay a fee to cross a boundary (e.g., into the central business district). Initially, those who don't have any choice, will grumble and pay the fee. But, in the long term, some residents and businesses will avoid the fee by moving away from the center. Thus cordon pricing motivates sprawl -- one of the major causes of auto-dependency and congestion. A BETTER APPROACH is to apply roadway pricing by the mile over the entire length of the priced roadway system. The fee should rise when the roadway is congested and fall when it isn't. To minimize the fee in the short term, drivers will make discretionary trips at off-peak times. In the long-term, people will locate homes and businesses closer to the activities that they engage in regularly. Thus a mileage-based pricing system encourages more compact development, and this promotes walking, cycling and economically viable transit as alternatives to auto dependency.
A good explanation of an often-overlooked approach to resolving the housing crisis and about why so few of us know about it.
Despite some nods toward "smart growth," urban sprawl continues unabated. Transportation costs rise as a result. They are to the economy like friction is to a machine. They wear it down and make it less productive.
Sprawl often requires a car trip for each and every activity outside the home. This is very expensive for our pocket books and very damaging to the environment. Achieving a better balance between transportation user fees and access fees can promote more compact development. This would increase transportation options (walking cycling, transit, car-sharing, etc.), reduce household and business transportation costs and enhance the environment. Let me know if you want the details.
Just Economics helps communities harmonize economic incentives with public policy objectives for job creation, affordable housing & sustainability.
