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I-976 and the Problem with Car Tabs

29 Oct 2020

Last week the Washington State Supreme Court struck down I-976. This is excellent news, since the measure would have removed a lot of funding for transit agencies, possibly crippling them.

It appears that the law was struck down for good reasons, namely that it was poorly written and didn’t adhere to the state constitution. However, the fact remains that a lot of people voted for it. Even though it could be argued that a lot of voters weren’t sure exactly what they were voting for (part of the court’s reasoning was that it was worded in such a way as to confuse voters what the effects would be), this isn’t the first time that Washington voters have passed this sort of law (though these laws have yet to make it through the courts).

Although I think that this is a good outcome, I can’t really consider this a win in the long term. If people are unhappy with car tabs as a funding mechanism for transit, this sort of legislation is going to keep coming up, and as the linked article points out, a lot of places around the state have implemented something similar on their own. We need to find a better way of funding transit (for example, my area passed a sales tax in 2018 to fund our transit system).

So what’s wrong with paying for transit with car tabs?

As with any tax or usage fee, people dislike paying for car tabs. However, attaching transit funding to car ownership seems like a particularly hard sell. After all, if you own a car, you probably don’t take the bus much. Sure, if those fees are used to expand light rail to your community you might drive to the station then take light rail to work/shopping/whatever, but until our transit system gets built up enough to allow the majority of people to maintain fewer personal vehicles, a lot of people are going to be paying into a system that doesn’t really work for them.

On the other hand, there is a certain logic to funding transit through car tabs. On its face it creates funding for transit while disincentivizing driving. The problem is that it doesn’t really disincentivize driving in any meaningful way. Once you pay for your tab, it doesn’t matter if you drive 100 or 100,000 miles in a year. Also $100/year is a small enough number that people won’t base purchasing decisions on it (“Hmm, I like that $50k car, but I would have to pay $100/year.” No, I don’t see that happening either.). In essence, you are getting money for transit by spending community goodwill, which is a scarce resource.

Just to be clear, I’m not arguing that driving and car ownership shouldn’t be more expensive. It should. If you look at the societal costs of driving (road construction/maintenace, space lost to parking, lives lost to collisions, mental health), there are a lot costs of driving that are borne by the general public. If you want to reduce the harm that cars do to our society, a rational place to start would be to set things up so that the societal costs of driving aren’t completely dissociated from driving and car ownership. What might this look like?

Keep car tabs, but put the money towards things like road maintenance

People will still grumble since our society doesn’t seem to get that taxes pay for services, but most reasonable people will see the connection between paying a fee for your car and having, you know, roads to drive it on. The more that road usage is paid for by usage fees, the more we can transfer money currently used for road construction and maintenance (a lot of which comes from the general fund) to transit (this same point holds true for the following ideas, too).

Replace or augment the gas tax with a Vehicle Miles Traveled (VMT) tax.

This has some pretty broad support and the benefit that it can be argued as people paying their share (you drive more, you pay more). The gas tax has been problematic for decades (the federal gas tax hasn’t been raised since the 90’s) and will get worse as electric vehicles become more mainstream, so it will need to be fixed anyway, we might as well replace it with something better.

Charge for parking.

Parking is expensive to build and maintain. On my way into work every, I pass by a row of houses along the waterfront, each of which is valued at about $500k - $1.5m. However, there is also parking on both sides of the street, and I see the same cars parked in front of the houses every day (the spots across the street are much less frequently used). I have to wonder, why am I subsidizing extra parking for someone living in a million dollar house?

Granted, I’m not as annoyed by this in working-class neighborhoods, since they are presumably less able to reconfigure their property to house more vehicles and more likely to only own vehicles that they need. However, if we are going to provide free on-street parking for everyone, then we should remove the permitting requirement for off-street parking, which would make it easier to build denser housing. In denser areas, such as city centers, there shouldn’t be free parking. I won’t go into that here, but will just leave a link to The High Cost of Free Parking by Donald Shoup, which makes the case that free parking has all sorts of negative side-effects and that there is a better way to do it.

Conclusion

Of course, a lot of that is about how we should pay for infrastructure for cars. What about transit? If car tabs isn’t a good source of funding, what is? I’m not sure. After all, if there were an easy, palatable way of funding stuff like Sound Transit 3, we would already be doing it. However, I do think that making it so that drivers pay something closer to their fair share of the societal costs of driving would free up a significant amount of money for things like transit. In addition, if drivers had to pay those costs directly, rather than having them hidden in other taxes, they would likely also be more willing to support funding for transit projects.

Another way of looking at is that while transit is great, it is only part of the transportation solution. In many parts of the country, you don’t just need a car to go to work, you need a car to do just about everything. When we build new communities, we should make sure that there are minimal services nearby. We should be upzoning neighborhoods to allow for denser housing that can support things like shops, restaurants, and medical offices. In short, we should follow the lead of Paris mayor Anne Hidalgo and strive to have “15-minute cities”.

Finally, I’d like to point out that I think that having roads and infrastructure for private vehicles is a good thing. I like being able to have mail and packages delivered. Riding on paved roads isn’t as nice as a dedicated trail, but it does beat gravel or dirt (for transportation, at least). I like being able to drive somewhere when riding my bike isn’t a great option. Even if I didn’t own a car, having good roads benefits me. However, I don’t think that is an unqualified good. Every time we make space exclusively for cars, we reduce space for something else, and cars aren’t very good at sharing space with pedestrians. Right now, we tend to think of space for cars as a necessity, but this becomes a self-fulfilling prophecy, since it leads us to invest in infrastructure for private vehicles rather than for transit and other sustainable modes of transportation. As a result, we have a system of incentives that encourages people to drive. Fixing those incentives won’t fix all of our problems, but it could go a long way towards a better future for all of us.