Wednesday, June 17, 2009

Tax and Spend

I would appear that I’m now writing a series on Portland. Today I would like to focus on vehicle miles traveled (VMT) per capita and public transportation. According to the book that I’ve now finished, Portland saw a drop of VMT per capita of 1.5% between 1993 and 2001. Portland was one of the only regions in the US to experience this drop. Metro Vancouver is also another place that experienced a drop of VMT that made it an exception in Canada. It is with this in mind that I wanted to look at transit funding.

It is clear that there has been a shift to public transit over the last little while and people are begging to see improved service, but sadly agencies in the US are cutting service like there’s not tomorrow. It seems that as more people are taking transit, less money is available for it. This is completely wrong. Let’s look at some reasons why.

Portland is usually proclaimed as transit paradise, and over the last decade there has been great improvement to transit in the region. That all changed this year. With the failing economy, TriMet was forced to cut 8% of its budget and apparently there are more cuts coming. TriMet receives 54.5% of its revenue from self-employment tax and payroll tax. With unemployment on the rise, less revenue is available. TriMet will need to find new revenue sources.

In Metro Vancouver, we face a similar funding issue. Besides fare, fuel tax and property tax are the two largest sources of revenue for TransLink. Vehicle taxes cannot be relied on for transit funding because as more people take transit and drive less, we end up with needing more service with less money. What is different about TransLink is that unlike TriMet, which receives 15.3% of its revenue from federal and state grants, we get 0%. If TransLink received 15.3% of its revenue from the provincial and federal government, we’d get an additional $140 million a year… Anyway, TransLink is working on finding extra money, but I believe that senior levels of government will need to step up.

1 comment:

bregalad said...

What's wrong with transit across North America is that it's being asked to operate like a business and break even. Transit benefits are far reaching and sometimes difficult to measure. Getting people out of cars helps everyone breathe easier and assists those for whom driving is the only option by freeing up space on the road and in parking facilities. Where are those benefits on a typical corporate statement of profit and loss? That's right, nowhere. That's why transit is being cut when it should be expanded.