Bacon's Rebellion

Don’t Tax Me, Tax that Man Behind the Tree

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by

James A. Bacon
in

No surprises in today’s Times-Dispatch transportation poll. Everyone wants the government to “fix” transportation — they just don’t want to pay for it. Large majorities of those polled opposed higher taxes in general, and even larger majorities opposed (a) an added sales tax on cars, (b) higher fees on insurance premiums, (c) an increase in motor-vehicle registration feeds, or (d) a wholesale tax on gasoline. Virginians also opposed borrowing money to build roads or cutting spending in other programs. A large majority, however, did endorse tougher fines on bad drivers.

Interestingly, two money-raising scheme won a narrow margin of support:

  • Raising tolls on some interstate highways: 49 percent in favor, 45 percent opposed.
  • Authorizing localities to impose local taxes for regional projects: 50 percent in favor, 43 percent opposed.

If there’s a politically acceptable solution to Virginia’s transportation woes, it wasn’t what the Kaine administration and state senate were pushing this spring.

As we have come to expect, the poll framed the transportation debate as a funding issue. Never considered were alternatives to the tax-and-build scenario:

  • Should lawmakers consider privatization and/or outsourcing of road maintenance to generate cost savings?
  • Should the Commonwealth Transportation Board prioritize projects designed to mitigate traffic congestion over projects that open up new areas for development?
  • Should the state do more to ensure that transportation and land use planning are coordinated?
  • Should the state encourage telework?
  • Should the state make it easier for the private sector to enter the marketplace with van, bus and other shared-ridership services?
  • Should major new developments be required to put into place Transportation Demand Management plans?
  • Should landowners whose property values increase thanks to transportation improvements be required to help pay the cost of those improvements?

Don’t tell me there’s no bias in the press. I’m not saying it’s a conscious or malevolent bias — it’s probably just tunnel vision, a lack of awareness of the alternatives. But lawmakers respond to daily news stories and editorials, and when reporters define the problem as a lack of money, they are defining the terms of the debate and limiting the range of options.

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11 responses to “Don’t Tax Me, Tax that Man Behind the Tree”

  1. Anonymous Avatar
    Anonymous

    The alternatives and options cost money, too, and they won’t fix the roads.

  2. Anonymous Avatar
    Anonymous

    The poll also didn’t ask about a straight gas tax increase, since none of the major proposals included it. At the end of the day, if anything gets done, it will be a hybrid that includes some taxes and fees, the diversion of more general funds, more burden at the local level, and there ought to be incentives (not mandates) for the approaches that focus on efficiency. But all factions are convinced they are doing God’s Work and any compromise would be the work of the Devil (you included Jim) and that’s the real breakdown. The process is built on compromise and nobody will do it.

  3. Ray Hyde Avatar
    Ray Hyde

    If they did a straight gas tax increase they would have to admit that they have been making a continually escalating mistake ever since 1986.

    Higher fees on registrations and insurance will hurt me and make the farm harder to run because I have several special purpose farm vehicles. These are old and inexpensive, but each of them does one job best, and each of them is seldom used. Instead, I’ll get rid of them and use one truck that is really suited only for the largest jobs that need done. This idea strikes me as dumb as toast, why charge people more for vehicles that are seldom used.

    Why just a wholesale tax on gasoline? Why not all fuel including home heating oil?

    Raising tolls on interstates and in some jurisdictions is just another way of saying tax the guy behind the tree. Everyone thinks or hopes it won’t apply to themselves.

    Otherwise, each of the alternatives has some merit. Outsourcing maintenance ight save money, and might not. You might just get shoddy work.

    Sureley working on the real problems makes more sense than making new ones: prioritizing projects makes sense.

    I simply don’t believe that anyone knows how to coordinate land use planning and transportation. Depending on who you talk to it is a code phrase for either preventing growth or preventing road work, and either way no coordination will occur. No one is going to promote both development and road building in this environment, so this idea is a dead turkey.

    The state might do some mild encouragement of telework, but it would be better to stay out of people’s businesses and ficilitate what they actually want rather than tell them what we might wish that they would want.

    Same goes for shared ridership plans: the state should facilitate and not prohibit, otherwise it should keep hands off.

    One thing you can count on about plans is that they will change. I see no reason to burden a developer with planning for something that is not in his business line, and is unlikely to be permanent anyway. The government should stay out of the business of restricting how and when people travel.

    If you get into the business of private property owners paying for improvements then it is only fair to get in the business of paying for deleterious actions on the part of government, too. Since government is far more restrictive than it is proactive and facilitating, this might open a Pandora’s box. On the other hand, if private interests pay for infrastructure, then you can expect them to act more and more as if they own it, and government will have lost what little planning clout it has by giving up financial control.

    After you do or don’t do all of those things, you will still have to work on the roads.

  4. Jim Wamsley Avatar
    Jim Wamsley

    “Should the Commonwealth Transportation Board prioritize projects designed to mitigate traffic congestion over projects that open up new areas for development?”

    Good question! False premise.

    In December 2001 JLARC issued a study that concluded that major changes in transportation were needed. It explaind that Virginia’s transportation project priorities were established by the allocation formula enacted by the General Assembly based on corrupted data provided by VDOT.

    This is why VTrans2025 is in actuality two reports. The first report describes changes desired and needed to support the citizens of Virginia. The second part is the list of projects based on the allocation formula priorities and the funding shortfall associated with these priorities.

    The press probably suffers from a lack of awareness of the alternatives. You are right. As long as reporters define the problem as a lack of money, they are defining the terms of the debate and limiting the range of options.

    We have heard no clamor for a solution to the transportation funding problem. Those citizens who say, “When you are in a hole, stop digging” may be right.

  5. Anonymous Avatar
    Anonymous

    It’s called The Car Tax, amigos.

    As much as we all hated to pay it, Gilmore & the GA did away with almost $1 billion per year in funding and never replaced that revenue.

    All of the things they/we are considering and fighting over today are nothing more than ways to replace that money.

    Call it what you want, tolls, gas taxes, sales taxes, increased insurance premiums, whatever – it’s just another example of robbing Peter to pay Paul because nobody’s tax burden really went down with the elimination of the car tax.

    At the end of the day, all of these things (tolls, gas taxes, sales taxes, increased insurance premiums, etc,.) are nothing more than a manifestation of the car tax.

  6. Ray Hyde Avatar
    Ray Hyde

    I’d still rather see a gas tax than a rainbow of new and higher taxes in all halfway related areas. At least with a gas tax the tax is based on cash flow and not historical sales of vehicles or other things unrelated to actual transportation. With gas tax it is flow and go, pure and simple and already in place.

    You are right though, the costs didn’t go away just because the tax did (sort of.)

    I don’t normally agree with Wendell Cox but here is what he had to say about coordinating land use and transportation, and this time I think he has it right:

    “One of the most enduring urban planning mantras is coordinating land use and transportation. While no one can dispute the desirability of coordinating land use and transport, the current strategies do exactly the opposite. That is because urban planning has been captured by an anti-automobile dogma that has the equation backwards. The idea is to densify and locate as much as possible adjacent to existing transportation infrastructure. The result, of course, is to significantly increase transportation demand.

    However, the demand side is never addressed. When densities are intensified, more intense roadway systems are required. Failing to expand the roadways means that traffic congestion gets worse and that transport and land use have demonstrably not been coordinated.”

    He goes on to say that adding transit service is like trying to reduce traffic congestion by increasing the frequency of garbage collection – one has nothing to do with the other. TMT has made this point with reference to spending ($4 to $8.2) billions on rail to Dulles.

  7. Toomanytaxes Avatar
    Toomanytaxes

    3:40 The elimination of the car tax was a return of part of the huge tax subsidies paid by NoVA to the rest of the state. We turned around and paid that money to our local governments as our real estate taxes sky-rocketed, but that’s better than than not having the car tax money returned at all. At least we got some of our tax dollars back before Richmond doled them out to keep real estate taxes low in the rest of the state.

    Besides, why should anyone pay higher taxes for transportation until VDOT institutes cost controls and the CTB is junked in favor of a plan to fund transportation projects based on their economic and engineering factors instead of who can hire the best lobbyist this year? If Virginia can afford to maintain these two huge flaws, it can afford to operate without additional transportation revenues. There is not a single business in the Commonwealth that would operate on the same basis as VDOT and the CTB. It’s unfair to taxpayers and commuters not to fix the problems now.

  8. Anonymous Avatar
    Anonymous

    Allocating money solely based on economic and engineering factors is a slippery slope to be on. I am not saying the current system we have is the right way, but be careful what you wish for.

    Take the Tysons Corner METRO Project and compare that with building an interstate through SW Virginia.

    Let’s say the METRO project comes in at $6 Billion when it’s all said and done. Folks in SW Virginia could just as easily argue that it would be good for their economy, and cost the state less money, to build a major interstate through their area – or at least half of it.

    The fight over transportation dollars would increase to a level unimaginable if the decisions were solely based on economics and engineering.

    IMO, every member of the GA longs for the day of having back the car tax which would provide sustainable, long-term funding for transportation.

    It’s very simple if you ask me. Cars use the roads so cars should pay a majority of the cost for the roads.

  9. Jim Wamsley Avatar
    Jim Wamsley

    I found this nice quote about transportation spending. This is part of the background for the current stalemate in transportation funding.

    “HJR 843
    Commission on the Future of Transportation in Virginia
    November 15, 1999, Wise

    Among the 15 presentations before the commission, the most frequently heard theme was that the transportation needs of Southwest Virginia, though very different from those of Northern Virginia, Hampton Roads, or other parts of the “Golden Crescent,” were no less vital than those of Eastern Virginia. While Eastern Virginia needs transportation improvements (including expansion of mass transit systems) to maintain its economic vitality and quality of life by keeping traffic congestion from strangling the economy and degrading air quality, Western Virginia looks to transportation improvements (particularly highway construction) as the foundation of its economic development. Speaker after speaker stressed that failure to address the region’s transportation needs will not only frustrate efforts to provide new jobs, but will almost certainly result in the loss of many existing jobs.”
    http://dls.state.va.us/pubs/legisrec/1999/HJR843E.HTM

  10. Ray Hyde Avatar
    Ray Hyde

    Yes, cars use the roads, but they need gas to do it. Gas revenues come from current funds that are available to spend. Better to tax that than to continue to tax moneies that were spent historically.

    Better to tax accosrding to use, meaning distance and weight, and better to use the tax to encourage economy, even if that economy means you have to raise the tax again. So far there is little evidence of that danger: nationwide we set new fuel consumption records last month.

  11. Toomanytaxes Avatar
    Toomanytaxes

    8:56 The only reason that the Tysons Corner Metro would be built is politics — a/k/a campaign contributions. See, for example, the amounts of money given by West Group executives to Tim Kaine’s campaign. Our Governor is a big supporter of extending Metro to Dulles. Yet, the State’s own data show that it would NOT improve traffic congestion. I’ve posted the LOS data before and after spending billions.

    The greatest fear on the part of the Tysons Corner landowners is that the proposal flunks the Federal Transit Administration’s cost/benefit test. They are probably scrambling with their lobbyists to find some way past the required economic tests.

    The same holds true for roads. If left to engineering and economics, there are probably a number of road and transit projects in NoVA that would produce positive results for the dollars spent. But take a look at the Northern Virginia Transportation Alliance. This group that seeks more funding and higher taxes (but will not disclose its funding) is lobbying hardest for projects such as the Techway and the Western Bypass. Why, not because these projects would necessarily fix traffic as well as other projects, but most likely because some investors made speculative land purchases that would become much more valuable if new major roads were built nearby.

    I submit that the existence of the CTB is the only way that these roads would likely be built. The CTB is the Good Old Boy Network, but it’s also a major barrier to cost-efficient transportation improvements. Why pay higher taxes into a corrupt, ineffective and inefficient organization?

    One more for the road. The Senate and Governor Kaine argue that the General Fund should be raided to pay for transportation projects. However, the General Fund reimburses local governments for the cost of car tax relief. Therefore, according to the Senate and Governor Kaine’s collective logic, the money used to pay for car tax relief should not be available for transportation spending. This is just one more example of the illogic used by the spend and tax crowd.

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