The United States needs to rethink its approach to transportation taxation. An over-reliance on “user fees” frames transportation as a question of who is paying their fair share and who really deserves access to the street.
Our transportation system is a common space and a public good and we should fund it as such.
In November, the Washington, DC city council moved to reduce the penalty for fare avoidance on Metro so that it no longer incurs possible jail time. This launched a controversy in the region as WMATA came out strongly against the proposal. On Twitter, the agency agreed with a commenter who framed fare evasion as “theft.” The reasoning behind this thought is that people who avoid paying fares are using the service and not paying for it.
This debate is part of a larger ongoing feud between travel modes that hinge on the question of who is “paying their fair share.” Transit riders are accused of this because on average, U.S. transit systems only recover a third of their operating costs in fares. This rhetoric is also aimed at people on bikes, because of the cost of constructing some bike lanes and the fact that if you don’t drive, you aren’t paying the gas taxes that pay for road maintenance and expansion.
The perception that transit riders and bicyclists don’t pay for the infrastructure they use has led to countless calls for canceling subsidies for transit, taxing bicycles to ensure no one is getting a free ride, and accusing turnstile jumpers of theft. Arguments about who is paying for what are rehashed endlessly. User fees as a funding mechanism, for all modes, should be abandoned.
But user fees excel as a tool to incentivize or disincentivize certain behaviors. Adding fees to otherwise free activities is a key part of the incentive model that transportation demand management relies on. TDM, as an outgrowth of behavioral economics, understands that individuals make economically unsound choices, both for themselves and for society at large. Transportation demand managers correct these misjudgments to get better outcomes through incentives and disincentives.
User fees are also a critical tool for managing demand for a limited resource, such as a road. When too many people use the same road, it becomes congested. This happens frequently because roads are free to use, and people tend to use more of free resources than they actually need to. Imposing just a small fee can cause someone to rethink their travel plans.
A user fee can be applied to adjust the number of road users, so it does not remain congested. During peak times, the price of access is raised, and it is lowered when there is less use. Those who really do need to use that road can travel more efficiently because there is less congestion. Others can adjust their travel times to save both money and time.
The I-66 toll lanes in Northern Virginia are an example of the effectiveness of this policy. Tolls climb almost to $50 at peak hours and are adjusted dynamically to maintain travel speeds of 55 mph. Drivers have changed their behavior in response by adjusting their schedules, carpooling, or taking transit to avoid paying the tools.
Notice how this pricing scheme bears no resemblance to the actual cost of road construction or maintenance. This is unlike the most widespread type of user charge in the U.S.: not toll roads, but the gas tax.
The federal gas tax was reimagined in 1956 as a user fee to fund the construction and maintenance of the highway system through the Highway Trust Fund. Though the trust fund has been insolvent for years, with gas tax revenues far outstripped by highway spending, hence necessitating repeated bailouts using general funds, the logic remains the same. Drivers – the “users” of the highway – purchase gas which has a tax that is earmarked for highway maintenance and funding. Theoretically, the more you use the highway, the more gas you buy and the more fee you pay.
This is the same logic behind transit fares. Like the gas tax, user fees for transit are nowhere near adequate at their present levels to cover the costs of maintaining the systems, but this is not really an issue for roads or transit. It is not necessary to fund transportation through user fees because transportation, as a public good, is a resource open to all and should be paid for by all.
User fees are not actually as fair as they seem. Though everyone pays the same amount and only for the time they use it, a flat fee impacts people quite differently. A $4 train ticket might not be much to you if you earn $100,000, but if I am working at minimum wage, that $4 every single day adds up. Transportation should not be reserved for those who can afford it.
By no longer relying on user fees to cover expenses, we can instead set them to manage demand. Transit can be made as cheap as possible, while balancing demand, to relieve pressure on roads, car travel can be charged higher, not to recoup costs, but to lower the number of cars and thus the amount of traffic fatalities, pollution and congestion. All these fees could be combined with free tickets for students, seniors, and low-income riders.
Our roads, our buses, our trains, and our sidewalks are not an amusement park that we should be expected to shoulder individually, but a collective asset, a vital public good. User fees should not be oriented towards a misguided idea of an equitable funding scheme, but rather towards the better functioning of the transportation system we all rely on. We should let our goals define the funding mechanism, not the opposite.
For more on incentives, check out our series Behavioral Economics and Transportation. Photo by Sam Kittner for Mobility Lab.