Transportation Regulation equalization

By Fester:

The draft House stimulus bill contains roughly $40 billion dollars for transportation.  Three quarters of that money is dedicated to highway construction and maintenance while a quarter is allocated to mass transit, including a the possibility of SUPERTRAINS.  I would prefer a 50:50 split or an inversion of the ratio, as my consumer surplus is much higher with mass transit, and I think the societal surplus is higher as well.

However, a 3:1 highway to mass transit split is a dramatic improvement from typical federal funding ratios.  The last major transportation law funded highways at roughly 5:1 over all other alternative modes of transit.  A good chunk of this ratio is purely political.  The law was written when the majority party's base and swing lives in the suburbs and exurbs.  Mass transit makes far less sense in low density areas, and when the votes are lined up, the marginal decision will be supporting the majority's preferences.  Furthermore, there is some serious interest group bundling aimed at political capture.  Developers, construction firms, some unions push hard for a form of construction that they understand and can exploit for their own interests.  Again, this is just politics.  Finally, the regulatory hurdles for highway construction are far lower than the hurdles faced by any other federal transportation project.

I think one of the major goals that mass transit and urban density advocates need to push for in both this stimulus package and the 2009 transportation bill is equalization of regulation.  For instance, a highway project just needs to show that it will add capacity to the regional system and that it serves some need.  It does not have to address induced traffic which is the traffic generated by the addtion of a new road to a network as previous trips that were not taken are now taken because it is closer.  Mass transit projects have to meet this hurdle AND also show that the project will reduce travel time on both the route and the system as a whole.  Mass transit has an induced traffic demand. 

Another example of car centered subsidization is the parking and mass transit tax subsidies.  Right now, employees can put up to $205 per month in a tax free parking reimbursement account or $100 for van pooling and $105 per month for a mass transit pass.  In all cases, the employee is able to deduct up to the cost of work transportation expenses or the above limits without paying taxes on it.  I use this plan for my bus pass.  However, as you can see, the plans greatly favor driving and parking.  Equalizing the subsidy limit by a dollar cost averaging of actual expenses would strongly encourage more mass transit utilization.

There are numerous little tweaks and twirls within both federal law and federal regulation that favor highway and car usage.  Equalization of the playing field would be a massive push for mass transit.