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OTOOLE: Fueling freedom

Highway user fees are best spent on congested highways, not empty bike trails

- The Washington Times - Monday, July 11, 2011

Cries of outrage reverberated across the country when House Republicans, led by Rep. John Mica of Florida, chairman of the Transportation and Infrastructure Committee, proposed a 30 percent reduction in federal surface-transportation spending. Never mind that all Mr. Mica's plan does is limit spending to no more than the gas taxes and other highway user fees that fund federal surface-transportation programs.

Still, cyclists and transit advocates are having hissy fits because Republicans would reduce subsidies to their favored forms of travel - subsidies paid, for the most part, by people who rarely ride a bike or use transit. While the Interstate Highway System and most state highways were funded almost entirely out of road user fees, transit and cycling proponents think other people should pay for bike paths, rail lines and other facilities dedicated exclusively to their use.

Congress passes a surface-transportation bill every six years, and the last several bills increasingly were dominated by an anti-automobile philosophy. The advocates of this view offer technologically backward "solutions," including streetcars dating from the 1890s, light rail dating from the 1930s and high-speed rail dating from the 1960s. Americans abandoned these technologies decades ago for being several times more expensive per passenger mile and far slower or less convenient than driving.

House Republicans are turning away from this trend, which has corrupted the spirit of state and local transportation agencies all across the country. User fees give transportation providers an incentive to offer users the systems they need. But when Congress started diverting gas taxes to transit and other nonhighway programs in the 1980s, this connection between users and providers was lost.

For example, the prospect of "free" federal money from a program called New Starts led cities to plan outrageously expensive rail projects that provide little real improvement in transit service. Transit agencies often cannibalize their bus systems to provide local matching funds. The result is that after hundreds of billions of dollars in subsidies, there is less per-capita urban transit ridership today than in 1980.

Partly because of diversions of federal gas taxes to nonhighway uses, urban traffic congestion has quintupled since 1982, wasting 4 billion gallons of fuel and 5 billion hours of people's time a year. The good news is that despite tales of crumbling infrastructure, our highways and bridges are in pretty good shape. User-fee-funded maintenance has steadily reduced the number of bridges rated "structurally deficient" and the average pavement roughness.

The same cannot be said for transit. With federal enticement, cities have built transit lines they cannot afford to operate, much less maintain. The Federal Transit Administration estimates the nation's transit systems suffer from $78 billion in deferred maintenance. Boston's MBTA, the Chicago Transit Authority and the Washington Metrorail systems are particularly close to collapse.

To support these financially unsustainable projects, the 2005 transportation bill included $24 billion in earmarks and mandated spending at prescribed levels even if gas tax revenues fall short. This forced Congress to appropriate tens of billions of dollars of general funds to transportation.

In contrast, Mr. Mica's transportation bill is fiscally responsible. Instead of spending floors, the bill spends no more than revenues. Instead of earmarks and competitive grants that encourage costly projects based more on pork than performance, Mr. Mica's bill distributes most funds using formulas based on such factors as the population and land area of the state.

The bill could be improved in two ways: First, it could reinforce user fees by making state and local user revenues one of the major factors in funding formulas. States could increase their share of federal funds by investing in projects that will return more user fees, signaling that people truly found those projects valuable.

Second, the bill should give at least a nod toward advanced transportation technologies. GPs-driven vehicle-mile fees will improve the connections between users and highway owners without invading people's privacy. Low-cost driverless cars were recently legalized in Nevada and are likely to become the dominant form of travel in 15 years.

By making transportation more dependent on user fees and less on taxes, Mr. Mica's plan will ease the introduction of these technologies. In turn, these and other technologies will improve the safety, energy efficiency and environmental friendliness of travel far more than spending billions on trains that few people will ride.

Randal O'Toole is a senior fellow with the Cato Institute and author of "Gridlock: Why We're Stuck in Traffic and What to Do About It" (Cato, 2010).

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