The Problem Using Auto Taxes to Pay for Transit

The Twin Cities funds transit partially through new car sales. In this recent economy its projected that the overall taxes from this method will be $200 million less than in 2003. The problem here is funding transit through increased auto sales. If more people have cars, how likely is it that they'll need increased transit alternatives? And in an economic downturn, the idea of funding transit through purchases is antithetical due to the greater need for transit during these periods, as evidenced in the last year. Even though transit receives a higher share of the car taxes today, that means a huge deficit for transit which in all likelihood means service cuts. But for capital projects, it means that like every other city, they have to hope for some funding that is likely not coming.

Despite a ridership increase of 6.8 percent for the first 11 months of 2008, the council predicts a budget shortfall of $72 million through the next biennium "just to maintain existing transit service and fund committed service expansions."

To me this is the problem with the stimulus, cities and regions which are the major economic drivers of this nation are getting the shaft when DOTs (aka Highway Departments) want to build new capacity to the outskirts. There's no more room for expansion in cities without tearing out more of the urban fabric. For too long we've funded roads to nowhere and with 50 years of the same policies, we have the problems we are in now. It's not like this is a new theory or something being tested, the new capacity idea has been tested for 50 years! We need to figure out a way to either make highways go through the same process as transit or loosen the strings for transit so lines can be built much easier. This also means more money for transit is needed in the stimulus package. Its time to start catching up.