Oppose City Funding Of Additional Red Line Service

WHEREAS most riders of existing Red Line service are likely not residents of the City of Austin and the majority likely don’t even reside in jurisdictions which pay Capital Metro taxes

and

WHEREAS the City of Austin already excessively subsidizes the existing Red Line operations, this as the overwhelming taxpayer to Capital Metro, contributing over 90% of Capital Metro’s revenue to allow the Red Line to be subsidized at a cost of nearly 34 dollars per ride

and

WHEREAS such funds as proposed to further subsidize the Red Line cannot possibly result in a positive economic outcome for the City of Austin given that weekend traffic on the highways is not substantial, and the city can only recover 1% of spending by visitors in the form of sales taxes

THEREFORE BE IT SUGGESTED that everybody reading this contact everyone you know and your city council members and advise AGAINST the City of Austin paying for expanded weekend service on the Red Line and saving the money, instead, for the city’s urban rail proposal – which, unlike the Red Line, will serve primarily Austinites and which desperately needs the money.

Who is riding the Red Line?

Well, we don’t know who, but we do know how many are getting on at each station. Thanks to Erica McKewen at Capital Metro for quickly supplying the following information (excerpted from a longer spreadsheet).

Morning boardings, AM peak:

Leander 154
Lakeline 211
Howard 154
Kramer 47
Crestview 26
Highland 12
MLK 8
Saltillo 3

Data from October 2011.

Analysis:

The stations where almost every passenger likely comes from the city of Austin are Kramer on down. Those stations account for (47+26+12+8+3 =) 97 boardings each morning.

The station where perhaps half the passengers come from the city of Leander (pays Cap Metro taxes, but not COA taxes – this is an important distinction for later in this post) accounts for 154 boardings each morning. So say 77 passengers here do not pay Capital Metro taxes.

The stations where most passengers likely come from places that are not the city of Austin and do not pay Capital Metro taxes are Lakeline and Howard, which account for (211+154 =) 365 boardings each morning. Say 10% of these boardings come from the city of Austin, and another 10% from other jursidictions that pay Cap Metro taxes (Leander, part of unincorporated county). This means 37 people from Austin, and 37 more that also pay Cap Metro taxes. If correct, 291 people that boarded here do not pay Cap Metro taxes.

(More on that last paragraph in another later post – suffice to say that rail stations on the edge of city limits are not going to attract most of their passengers from within that city as those people would be backtracking to board the train).

Combine those and you get a reasonable estimate that of the 615 AM peak boardings in October in this sample, about 368 are from places that do not pay any Capital Metro taxes and about 134 are from the city of Austin.

Put another way, 60% of the riders of MetroRail do not pay any taxes to support MetroRail, and 78% of the riders of MetroRail are from outside the city of Austin. If we assume the weekend ridership will be roughly the same as the in-week ridership (and this is a big assumption), these numbers would hold there too. More on that as details become more clear, but I think that even if the line terminates at Lakeline, the numbers would stay roughly the same, since some of the Leander riders would still ride, and far fewer of the people getting on in-town will (since weekend connecting bus service is far less likely).

In other words, if the city does what it is rumored to be doing and decides to pay for weekend MetroRail service, they’ll be paying 20 bucks a ride (collected from Austin taxpayers) to carry mostly non-Austinites downtown in the hopes of collecting a quarter (25 cents) or so of sales tax from each of them (that sales tax only being ‘extra’ if those people wouldn’t have driven downtown anyways – to say nothing of lost parking revenue if they would have paid to park).

Other posts in this series:

Brewster et al, I Told You So

Especially Brewster, but also some others are finally, now that it’s long too late, beginning to question the wisdom of continuing to give Capital Metro $160 million / year when they turn around and spend all the rail money on a plan which screws Central Austin and provide useless Rapid Bus service as the “thanks for 92% of our tax revenue” gift. Kudos to Kimberly for coverage of this issue.

Let’s set the wayback machine to May of 2004. I wrote a post on that day referring to a resolution I floated; the text is below. While Brewster from all accounts thinks I’m a troll, the irony of seeing him come pretty darn close to my 2004 position is just really really delicious. Of course, I’d trade it in a second for some actual movement on this issue.

WHEREAS the City of Austin does not receive adequate mobility benefits from the currently proposed Long Range Transit Plan due to its reliance on “rapid bus” transit without separate right-of-way
and
WHEREAS a “rapid bus” line does not and cannot provide the necessary permanent infrastructure to encourage mixed-use pedestrian-oriented densification along its corridor
and
WHEREAS the vast majority of Capital Metro funds come from residents of the City of Austin
and
WHEREAS the commuter rail plan proposed as the centerpiece of this plan delivers most of its benefits to residents of areas which are not within the Capital Metro service area while ignoring the urban core which provides most Capital Metro monies
THEREFORE BE IT RESOLVED that the Urban Transportation Commission recommends that the City Council immediately reject Capital Metro’s Long-Range Transit Plan and begin working towards a plan which:
A. delivers more reliable and high-performance transit into and through the urban core, including but not limited to the University of Texas, Capitol Complex, and downtown
B. requires additional user fees from passengers using Capital Metro rail services who reside in areas which are not part of the Capital Metro service area
C. provides permanent infrastructure to provide impetus for pedestrian-oriented mixed-use redevelopment of the Lamar/Guadalupe corridor
IF CAPITAL METRO will not work with the City of Austin on all items above, THEREFORE BE IT FURTHER RESOLVED that the UTC advises the City Council to begin preparations to withdraw from the Capital Metro service area and provide its own transit system in order to provide true mobility benefits to the taxpayers of Austin.

It died for lack of a second. Since then, two fellow commissioners expressed their regret at their decision to not at least second the motion so we could have gone on the record, after seeing how the plan unfolded pretty much as I predicted way back then.

Finally somebody else gets it

I’ve been arguing for a long time that the “commuting calculators” pushed by cyclists to convince people to ride their bike to work are skewed, since they assume that you can effectively divide the total cost of owning a car by the number of days in a year, then get credit for each of those days you leave it in the garage.

Capital Metro’s example, for instance, assumes depreciation as one of the costs you save. (To be fair, they have now allowed you to zero out this field, which is quite a concession for them). I’d argue it should be zero or at least very low, since most of the cost of depreciation is a function of time, not miles. I’ve previously argued that a more rational accounting of costs shows that it’s unlikely that a large number of suburban commuters would begin using the bus to get to work due simply to the cost of gasoline (which is why we need a real urban rail system that provides a time incentive to use transit; not this Austin-screwing transit-killer foisted on us by Mike Krusee).

Now the Washington Post has done an analysis which, although it still includes depreciation, correctly mentions other fixed costs which don’t go away. In DC, as it turns out, you might not save anything by leaving your car in your driveway. Whatever you think of the merits of subsidizing public transportation, surely even the most reactionary of road warriors would admit that something’s wrong there.

What could be done to help fix this problem? One obvious answer is to pay for all of the costs of road use through the gasoline tax, instead of through a variety of non-user-fees as we do today (property and sales tax especially). The suburban regions of DC, like Texas, pay for a lot of their roads this way – meaning that you pay the same (hundreds to thousands of dollars a year) whether you drive 100, 10, or 0 miles a day. Anything which increases the variable cost of driving while leaving the fixed cost alone (or even decreasing it) can only help people make more efficient decisions about how to travel on each trip. Another obvious answer would be forcing insurance companies to deliver on mileage-based insurance (and, no, despite publicity, they really aren’t doing this today – or I’d be jumping all over it).

Economic theory and physical reality

The Peak Oil guys keep trying to tell the economists that there’s a drop-off in oil production coming (the ‘peak’), and the economists keep saying that the market will solve the problem when it arrives. Left unsaid is that sometimes market solutions involve “demand destruction” in the form of recession, depression, or worse.

Most of the energy optimists though think the market will wave its magic wand and incent the development of alternative technology. This is foolish – economics can’t trump physics (especially energy density), but it’s hard to sell this to economists. But I just had an idea, after hearing an old Spin Doctors song on my itunes shuffle.

What amount of money would I have to give you right now to develop a technology that would allow me to achieve Superman-like powers of flight, heat vision, super strength, etc? After all, if the power of the market can solve any problem, presumably there is a ‘bid’ I can make at which it will be able to solve THIS one, right?

(If the answer is “not an infinite amount of money, but considerably more than exists in the entire world economy” then you might as well treat it as an infinite amount of money for all intents and purposes. The same logic applies for oil – how much money will it take to get a portable energy storage mechanism which can achieve goals X, Y, and Z? Answer: money can’t beat physics – there are some problems that no amount of money will ‘solve’ for given acceptable values of ‘solution’).

Transportation microeconomics 101

Reformatted in August 2012 to fix some dead links and make it look slightly nicer. Keep in mind this was written back in 2005; I have changed no content beyond this first paragraph.

I talk about this enough that it might should be its own category.
Problem: Bozoes in government, in the media and elsewhere think about transportation at only the highest level – where you’re moving thousands of people around the city. This usually ends up producing plans which fail spectacularly at serving their intended constituents. Since this often boils down to money, I’ll call this “transportation macroeconomics” even though most of the people who do it aren’t thinking about economics. (Hint: they should be).

Solution: Transportation microeconomics. Whenever evaluating some transportation plan or change in economic conditions, take a couple of representative ‘use-cases’ and analyze the economics of their decision-making at their local (individual) level.

Example 1: Toll Roads. Local activist Roger Baker has been on my case on the austin-bikes email list for talking favorably about toll roads (as the least noxious of the two realistic possible outcomes – the other one being that all of those toll roads are built anyways, but as free roads). I’m going to be more favorable to him than he is to me, and construct an argument based on his stated motivations (he likes to accuse me of being a toll-loving road warrior). Roger’s point is, basically, that the toll roads won’t have enough traffic to pay off the bonds once the “oil peak” causes gasoline to get even more expensive than it is now. He’s definitely one of the SOS-bloc (don’t build these roads at all because they promote sprawl and hurt the aquifer) rather than the free-roads-bloc (“double taxation!”) best exemplified by Brewster McCracken and Gerald Daugherty, who will end up getting central Austin to pay for these roads via property and sales tax kick-ins.

So, is Roger right? Would expensive gasoline lead to an exodus from the suburbs and a default on the bonds which back the toll roads? Or am I right – that the traffic which today would fill the toll roads in a second isn’t going anywhere even as gasoline gets more expensive. Let’s look at a use-case.

Joe Suburban drives his Suburban on a 30-mile round-trip every day from western Travis County to his job in one of the southern suburban office parks. He gets roughly 15 mpg on this commute and pays $2.00/gallon for gas today. By some calculations, which include depreciation, he pays a hefty price for his commute even today, but I categorically reject the idea that suburbanites will reduce the number of vehicles they own (barring catastrophically high gas prices), so depreciation should not honestly be part of the cost equation. Using my handy depreciation-free cost estimator, Joe’s daily commute cost is $2.79 today (remember, no tolls yet). Is that enough to convince Joe to carpool? Not today it isn’t. Is it enough to convince him to use transit? Even at the discounted rate, the bus trip from the park-and-ride at 290/71 costs him probably an hour extra time per day, and still a buck ($1.79 savings at the cost of an hour). This assumes he even HAS a transit option, of course. Most suburbanites don’t.
Suppose gasoline DOUBLES in price – to $4.00 a gallon. Joe’s daily commute cost (with new tolls of, let’s say, $1.50/day) is now: $6.91/day. His “transit cost” is now $5.91 for an hour of time, assuming no rise in bus fares (unlikely). Still not very attractive, I hate to say.

All right, suppose gasoline TRIPLES in price – to $6.00 a gallon. Joe’s cost is $9.58/day. Transit option would save $8.58 a day at the price of an hour. I hate to break it to you, but most suburbanites would still drive at this cost. Bad news for Roger: $6.00/gallon gas is roughly equivalent to $160/barrel (working backwards from this logic which is admittedly crude). That’s quite a bit further down the “oil peak” road than most people think we’ll hit anytime ‘soon’. In other words, it will take such huge increases in the cost of gasoline to get suburbanites to stop driving to work alone that it’s not even a factor for the foreseeable future. Even then, one would assume that rather than abandoning their stake in the ‘burbs, some large percentage of suburban drivers would just get more fuel-efficient cars. At $6.00/gallon, driving a Toyota Prius, Joe Suburban’s daily commute cost drops back to 2.48 without tolls and 3.98 with. Oops.

See my previous article on my ‘week without a car’ — even for me, who is the only guy at my 60-person office who could possibly take the bus to work without transfers, it’s not cost-and-time-effective to use transit until gasoline is really REALLY expensive. It costs me about 30 extra minutes per day and saves me pocket change.

When does transit make sense? When the time penalty is minimal and/or the cost savings are comparatively large. Two obvious (much shorter) use-cases:

  1. If I worked downtown, I could take the #5 bus straight there at a time penalty of perhaps 5 minutes. This time penalty is so small as to be not worth counting, and I could actually get rid of a car, thus moving us into the realm of the traditional commute calculators – a huge economic win for the transit alternative. Unfortunately, the current economic regime penalizes businesses who locate downtown rather than in the ‘burbs (far higher property taxes) even though they generate far less demand on city services.
  2. Lucy Leander works at the University of Texas and has to pay roughly $5/day for parking. She lives close to a park-and-ride where she can pick up a good express bus to work which isn’t much slower than her car would be. Here’s her comparison. Even at $2/gallon, she saves $7.36 a day (without getting rid of a car) and only spends a few more minutes. Note that having to pay for parking makes this comparison far more favorable for transit.

So my lesson is: Major employers should be downtown (where transit can serve them), and parking shouldn’t be free. Until either one of these is fixed, however, you’re going to get nowhere with me by claiming that a plan is economically viable (or not) based on gasoline prices.

Unfortunately, current conventional wisdom is still that spreading jobs through the suburbs reduces average driving (absolutely false). The facts have an anti-suburban bias, I guess.

Cost of driving to driver

So in Tuesday’s Cap Metro briefing, one of the points I made is that an attempt to encourage people to use transit based on cost savings is doomed to failure, because the bus really isn’t any cheaper than the car for most people. Assumption here is that you won’t be able to completely get rid of a car, i.e., you ride the bus 4 days a week, or even 5, but can’t reduce your family’s number of cars.

The two downtown lawyers looked at me as if I was crazy. Well, I’m used to it.

Here’s the problem: Most of the people who pay a lot of money to park work downtown. Almost none of the new buildings there are underserved with parking, though; so the average cost per employee to park is dropping, even in the one place in town where it isn’t free. Free is a good assumption to work on (I suspect that most employees in those new buildings are getting free parking from their employers).

Then, we hit the “well, the IRS claims 27.5 cents per mile”, or whatever they’re saying now.

Yes, the IRS does in fact allow you to deduct business-related driving at that level in most cases. A big chunk of that is not gas, or tires, or maintenance – it’s depreciation, which makes sense for a business (which usually must depreciate assets like that as a matter of accounting principle).

But I went over this with my bicycle cost comparator. The fact is that unless you can get rid of a car completely, this depreciation number is not applicable to using your car for personal use (and yes, commuting to work is personal use).
I have never gotten one more dollar for a car on a trade-in for having disproportionately low mileage. Anectodal evidence exists of a few people who got an extra hundred bucks or two on a ten-year-old car for low mileage, but even that figure is trivial compared to how much of the original value of the car depreciated as a function of time, not mileage.

So, if you’re talking about taking the bus to work even every day but you live in the suburbs, you ain’t getting rid of that car, and thus, you ain’t saving 27.5 cents per mile. Gas and tires are about all the consumables you can treat as a mile-based expense; most maintenance is necessary every N months even if you drive the car a tenth as much as the typical user. Insurance is not mile-based (even though there were a flurry of press-releases about it supposedly being offered in Texas, it hasn’t materialized). Neither is registration.

So, a comparison for me:

I drive my wife’s old Honda Civic to work (when I drive). I take my bike on the other days, using the express bus for a boost in the morning. Let’s suppose I took that bus both ways.
From my calculator on my trip:

  • Car cost: $1.20, of which $1.10 is gas.
  • Bus cost: $2.00 ($1.00 each way).
  • Note that the following bus savings can be used:
    1. You can buy pre-paid tickets at half price, thus bringing the bus cost down to $1.00.
    2. You can buy a monthly express bus pass for $17 ($0.84 per day if you used it 25 days a month).

    Even in the most optimistic scenario, I’d only save $0.16 per day by taking the bus. That’s never going to be compelling enough to get me to vote for any transit proposal whatsoever, which was the point to begin with.

    For comparison, Cap Metro’s calculator says it costs me $184 a week if I drive all 5 days.

    Cap Metro doesn’t understand “choice commuters”. The things that could get them to vote for more money for transit are:

    1. Reliability – my trip down Mopac takes 20 minutes to 1 hour depending on traffic. A guaranteed trip time of 45 minutes on which I could read would be worth something.
    2. Performance – 45 minutes, OK. 1 hour, no way.

    Unfortunately, their rapid bus proposal does next to nothing on either metric above.

The Gas Tax Ain’t Regressive

Dave Fried talks about the supposedly regressive nature of gas taxes in response to Andrew Sullivan, and uses my blog to make a point about public transportation, but he’s barking up the wrong tree.

The supposed regressive nature of the gas tax is a fallacy – in fact, poor people spend far less proportionally on gasoline than do the upper-middle-class.

The gas tax isn’t purely progressive; though; the very rich actually spend less proportionally than do the upper-middle-class, due to their tendency to be either in the few healthy downtowns, or less need to drive overall.

Poor people as a rule simply DON’T drive as much as you middle-class people think. The people you think are poor who you see driving everywhere are actually the lower rungs of the middle-class; and they’re doing it in much more fuel-efficient vehicles than their upper-middle-class SUV-drivin’ non-neighbors. Even the poor people who own cars (and most do, around here) often leave them parked during the day. Drive around East Austin at 10:00 on a weekday and you see a lot of driveways with older Japanese cars parked in them (with a few 80s-vintage American cars which still get much better mileage than do SUVs). Now drive around Great Hills and see how many cars you see parked which aren’t for stay-at-home moms.

Poor people, in every metropolitan area with which I have a passing familiarity, are also concentrated in urban areas or the oldest (inner-ring) suburbs. (Don’t bother me with anecdotes about the rural poor; we’re talking macro scale here). Guess what that does to the number of miles they must drive?

Ride the bus sometime if you want to see real poor people. Trust me on this one.

The other problem with this analysis is that it ignores other sources of roadway funding, such as property and sales taxes, which in this state are a huge portion of revenues for roads (even state highways). Due to the fact that poor people here live in areas which still proportionately get taxed at a higher rate than due the exurbs, they’re ALREADY being taxed regressively. The gas tax evens it out a bit, in fact.

Some supporting articles (note: links changed to web archive in 2020 as the originals have turned into 404s):