Monday, May 7, 2012

Some Perspective on Transportation Costs

A recent article in discussed recommendations from the Countywide Transit Financial Advisory Committee. I had already had the opportunity to check out the complete plan; what struck me about the article was the overwhelmingly negative tone of the comments. After all, most people who gave citizen input about the possible county-wide plans voted for the "smart growth" plan, which was clearly the most costly of the three options presented.

Of course, I realize that people who oppose something are much more likely to speak out than those that support it. And I know that any suggestion of raising taxes is an especially productive way to invite negative comments.

That's what I want to put into perspective. The Financial Advisory Committee suggested a half-mil tax. That works out under Michigan law to be $50 on a house valued at $200,000; which is pretty close to the average of the county's home prices.

My biggest objection to those who rant about taxes for transportation is how it compares with the cost of fuel for automobiles. As I've pointed out before in this blog, the great majority of the money we pay for our gasoline leaves Michigan to enrich others, including the governments of nations that are hostile to us. (More on this in a moment.)

We can't do anything about the cost of gasoline, which is controlled almost entirely by oil speculators for their own profit. On the other hand, most of what we pay for transit stays in the United States, especially in Michigan. (Yes, some does go out of the country to pay for diesel, but remember: AATA uses domestic biodiesel along with diesel from mineral sources.) All the buses are made in the USA, and all the personnel costs stay right here in Southeast Michigan.

But, the critics say, I don't care where the money goes to, I'm talking about where it comes from: my bank account! So here's a little reality check to illustrate how out-of-proportion the objections are...

A 2012 Ford Explorer (the popular mid-size SUV) has an 18.2 gallon tank. Gas has been running about $3.799 per gallon as I write this. That means each complete fill-up of the Explorer's tank costs $69.14. Of course, you won't fill the entire tank unless you totally run out of gas, but you'll easily put in $50 every week (that's just over 13 gallons) if you use the vehicle to commute and/or take kids to school and after-school activities. That's as much as most people will pay in an entire year to make transit more convenient in Washtenaw County.

Of course, that's only half the "reality check". The other half is what - if anything - most people would actually save. Most people won't be able to reduce their car use much, but suppose they're able to let a kid ride the bus to a practice, and possibly take the bus to work once a week. Even saving one gallon a week, at $3.799 (assuming the price doesn't go up - ha!) would amount to $50 in just over three months.

As a business decision, that would make a lot of sense, because a three-month payback period is really good, and the investment ($50) is pretty darn small.

Yes there would be quite a few people who would pay more than $50, and who would probably be reluctant to use their car less, even if transit were more convenient. So why would they vote for this? Maybe because it would save their city from investing even more money to build downtown parking? Maybe because they're able to think far enough ahead to see that our sprawl growth pattern isn't the best for the long term?

The only drawback is that a half-mill won't really get the improvements going very quickly. I'd recommend a heftier millage to build up the transit network sooner - a full mil, $100 per year on average, really isn't all that much for the value the community would receive. It could still only take six months for most people to break even on the investment!

I know there are some folks whose distrust of government is so deep that they would rather pay for anything than pay tax to their government. But you see, when you buy gasoline, you're sending money to several governments. In the blog post "National Deficits: Government and Oil" (linked below), I calculated that 57% of our gasoline money goes to friendly foreign countries and allies, but 6.4% goes to governments that are actually hostile to us.

How does that compare with the proposed millage on a yearly basis? Well, the average car is driven 11,489 miles yearly according to the Federal Highway Administration, and the average fuel consumption was 23.8 MPG. Doing the math gives us a ballpark yearly average of $1,834 for each car's fuel, meaning that we send about $1038 to other countries every year, including $117 to countries that don't like us.

And we can't do anything about it: we can't vote the rulers of those countries out of office, nor can we we pick and choose where our gasoline comes from. So it's not a question of refusing to pay more taxes: we're already stuck paying money into the treasuries of several foreign nations.

But (and here's my point): the more we improve our transit system at home, the less we'll be forced to pay foreign countries for our fuel.

I'm actually pretty confident that most Washtenaw County voters will see the value of improved transit, and will be willing to pay for it.

No comments:

Post a Comment