Toll Roads Help Central Austin, Part IV

The city is talking about amending the agreements with TXDOT about right-of-way participation for some local highways which are now, obviously, being rebranded as toll roads. This applies only to US 183 (east of I-35), US 290W, and SH 71 (east of I-35).

Note carefully the following facts:

  1. The city of Austin was on the hook for tens of millions of dollars for these roads, if they were to be built as freeways. The chance that this money would be extracted from Austin is 100%.
  2. The money for these contributions from the city to the state was authorized by the City Council in past cost-sharing agreements with TXDOT, which would require that bonds be floated like these examples in which voters authorized the city to borrow money for other recent highways.
  3. That borrowed money must be repaid by taxpayers in the form of property taxes, sales taxes, and other sources of revenue (mainly utility kickbacks). There is no contribution from gas taxes to the City of Austin budget. None.

What this means, in effect, is that the people in Central Austin who are disproportionately taxed on their properties (due to higher land values, not necessarily higher incomes) are paying these bills, and those are the people who drive the LEAST. Residents of the more sprawling parts of Austin are somewhere in the middle (pay less than Central Austin, get some benefit), and the real winners are people living in Dripping Springs, Bastrop, etc who pay nearly nothing and get most of the benefit of these particular roadways.
Now that the roads are being re-floated as tollways, the city is free (pending this agreement) to use this money (again, property and sales tax and utility dollars, NOT gas taxes) within the city limits of Austin for the needs of actual Austin taxpayers. And the people who most benefit from the roadways will actually have to pay for them.

What a communist idea.

Summary: toll roads are a winner for residents of Austin.

Double Taxation Isn’t Restricted To Roads

The anti-toll zealots, and in particular, Sal Costello like to whine and moan that tolling freeway expansions which are (mostly) paid for with gas tax money is “double taxation”. Left to the reader is the obvious implication that “double taxation” is a bad thing, and is new.

As you might have guessed, I’m here to tell you otherwise. First, a simple example.

Last weekend I drove down to Zilker Park on Sunday morning to play volleyball. (For reasons of time, I wasn’t able to bike, although I do that sometimes too). At the entrance to the loop which meanders through the river side of the park, there was a booth (A TOLLBOOTH!) set up, at which I paid 3 big bucks for the privilege of parking my car at the park.

BUT WAIT! Zilker Park was ALREADY PAID FOR by my property and sales tax dollars! How can this be? This is (organ music) DOUBLE TAXATION!

The fact is that suburbanites whining about toll roads have had it pretty good for a long time. They’ve had their road infrastructure subsidized by the center-city, they pay far less comparatively in property taxes, and they impose most of the negative externalities of driving on us center-city residents. Nobody in Circle C has to worry about an elevated freeway monster wrecking some of their neighbor’s houses and ruining everybody else’s outdoor activities.

Yes, they (but mostly us center-city folks) paid taxes to build these roads already. So toll roads, as designed in this case, are, in fact, (organ music) double taxation.

True libertarians (which many in this anti-toll coalition claim to be) would recognize toll roads as a baby step towards road pricing, which is the evil capitalist concept that the scarcity in road space ought to be managed by charging people to drive on it. These suburban republicans who like to call themselves libertarians instead advocate taxing everybody who drives (and a healthy chunk from those who don’t drive too) to build a freeway where the cost of driving is low, but there’s less incentive for each driver to explore alternate options to single-occupant commuting, so the road ends up crowded, just like, I don’t know, every single highway we build.

Just as in Zilker Park – if parking were free, every single space would be full, and the ring road would be a nonstop parade of cars futilely seeking space. At $3/car, however, there’s at least a small incentive for those whose utility is marginal to seek other solutions to the problem. (I might ride my bike; two of my friends might carpool; a third person might take the bus; somebody else might use the park during the week instead of the weekend; etc.)
So in summary: suburban Republicans like Sal Costello prefer the Soviet economic model – very low prices (subsidies from entire society), scarcity “managed” via long lines.

I hope this helped you understand the concept of double taxation and why we should all be against it.

Your pal,
Mike Dahmus Age 33

Toll Roads Help Central Austin

Sal Costello is pissed that TXDOT has bribed the City of Austin with rebates on previously spent right-of-way money if they agree not to oppose these roads’ tolling.

As I’ve noted in draft form (I now hopefully have the motivation to go back and finish those posts – as I do, see the bottom of this post for links), huge chunks of bond money approved between 1997 and 2000 by City of Austin and Travis County voters were designated for “local participation” in projects like SH130, SH45, Loop1, US183, SH71, and US290 freeway and tollway extensions and expansions. This “local participation” boiled down to (in most cases) 10% of right-of-way costs + utility relocation. Doesn’t sound like much, but it added up to tens of millions of dollars each time.
What’s the rub? The city and county don’t get any money from gasoline taxes. These bonds will be repaid using city and county funds, which effectively means property and sales taxes (or in the city’s case, utility slush funds paid back by electric customers).

Note: You pay this bill no matter how much or how little you drive; no matter how efficient or inefficient your car; no matter whether you take the bus, ride your bike, or walk.

And guess who pays the most, proportionally, in property taxes? Here’s a hint: My small lot in central Austin is valued far higher than the comparatively vast Steiner Ranch lot of one of my cow orkers; more than the huge lot of one of my friends on “The Mountain”; heck, more than Sal Costello’s lot in Circle C. Most of the costs associated with city and county spending are related more to the size of the area covered rather than population density, by the way. And Sal’s getting far more lane-miles and far wider streets for his $0.50 than I am for my $1.35.

Accepting this rebate from TXDOT helps Central Austin. Of course, it requires Sal and his Circle C buddies to start paying more of their fair share instead of being subsidized by the central city (we’ll still subsidize you with our gasoline taxes when we do drive, but the property and sales tax subsidization will drop dramatically). So you can understand why the southwest and northwest Austinites are so ticked off, even if they hide behind the baloney claims of “double taxation” (I paid to park at Zilker Park last weekend; was I “double taxed”?)

Responsible City Council members should ignore this caterwauling and do what’s best for the fiscal interest of the city – which means tolling roads used disproportionately by people who either don’t pay any city taxes (because they live outside city limits) or pay relatively little. If you want less sprawl and a healthy center city, please make your voice heard.

Past highway spending in bond elections (added as I finish them over the day):

Why Central Austinites Should Support Toll Roads

Excerpted from a discussion on the austin-bikes email list, where one of my self-appointed burdens is to be the voice of reason towards those who live in the center-city echo chamber (where everybody bikes; where nobody wants sprawling highways; etc).

The last paragraph of my response is the most relevant piece, and the one that the person I was responding to and many other wishful thinkers just don’t get. I, thanks to moving here with suburbanites, and working with exclusively suburbanites, have learned the following painful truths:

  • There are more suburbanites around here than urbanites. A LOT more. And the most recent election, they finally WON a seat in our city council (McCracken over Clarke) DESPITE much higher turnout in the center-city.
  • Outside Austin, there are no urbanites. CAMPO is now 2/3 suburban, for instance.
  • Suburbanites cannot conceive of any lifestyle other than the suburban one. Really. I get blank stares when I tell them I rode the bus to work today, or when I say I walked to the store.
  • The sheer population and geographical coverage of suburban neighborhoods means that even if gas gets really expensive, they’re still going to be living there. Resistance to their redevelopment in ways which aren’t so car-dependent and the cost of such modifications means we’re stuck with what we have now for at least a few more decades. Yes, even at $5.00/gallon.

Here’s the thread:

Roger Baker wrote:
> On Mar 4, 2005, at 9:34 AM, Mike Dahmus wrote:
>
>     Roger Baker wrote:
>
>         McCracken is the immediate hero here, but he likely wouldn't
>         have done it without Sal Costello, SOSA, and all the
>         independent grassroots organizing.
>
>         On CAMPO, McCracken's resolution got defeated about 2 to 1,
>         with Gerald Daugherty on the bad side, along with CAMPO
>         Director Aulick. TxDOT's Bob Daigh deserves a special bad
>         actor award for expressing his opinion just before the CAMPO
>         vote, with no reasons given, that any independent study of the
>         CAMPO plan would be likely to threaten TxDOT funding for our
>         area. -- Roger
>
>
>     Just like the transit people in Austin with Mike Krusee, you've
>     been completely snookered if you think these people are your friends.
>     The goal of McCracken et al is NOT to stop building these roads;
>     it is to build these roads quickly as FREE HIGHWAYS.
>     In other words, McCracken and Costello ___ARE___ THE ROAD LOBBY!
>     Keep that in mind, folks. Slusher and Bill Bunch don't want the
>     roads at all, but pretty much everybody else who voted against the
>     toll plan wants to build them as free roads.
>     And these highways built free is a far worse prospect for Austin
>     and especially central Austin than if they're built as toll roads,
>     in every possible respect.
>     - MD
>
>
> All that is easy for Mike to say but, as usual, lacks any factual basis or
> documentation. Furthermore, he does not appear to read what I have previously
> documented.

(my response):

As for factual basis or documentation, it should be obvious to anybody with the awareness of a three-year-old that McCracken’s playing to his suburban constituents who WANT THESE ROADS, AND WANT THEM TO BE FREE, rather than Slusher’s environmentalist constituents, who don’t want the roads at all.

As for reading what you’ve previously documented; oh, if only it were true. If only I hadn’t wasted a good month of my life reading your repeated screeds about the oil peak which have almost convinced me to go out and buy an SUV just to spite you.

POLITICAL REALITY MATTERS. The suburban voters who won McCracken his seat over Margot Clarke WANT THESE HIGHWAYS TO BE BUILT. AND THEY DON’T WANT THEM BUILT AS TOLL ROADS BECAUSE THEY’LL HAVE TO PAY (MORE) OF THE BILL IF THEY DO.

Here’s what’s going to happen if Roger’s ilk convinces the environmental bloc to continue their unholy alliance with the suburban road warriors like McCracken and Daugherty:

  1. We tell TXDOT we don’t want toll roads.
  2. TXDOT says we need to kick in a bunch more money to get them built free.
  3. We float another huge local bond package to do it (just like we did for local ‘contributions’ for SH 45, SH 130, and US 183A).
  4. The roads get built, as free highways.
  5. Those bonds are paid back by property and sales taxes, which disproportionately hit central Austinites, and especially penalize people who don’t or only infrequently drive.

Here’s what’s going to happen if the toll roads get built, as toll roads:

  1. TXDOT builds them.
  2. The current demand for the roadway is large enough to fill the coffers enough to keep the enterprise going without the bonds defaulting.
  3. (Even if #2 doesn’t happen, we’re at worst no worse off than above; with the added bonus that suburbanites still get to finally pay user fees for their trips on the roads).

Here’s what’s going to happen in Roger Fantasyland:

  1. McCracken, Gerald Daugherty, et al have a Come To Jesus moment and decide that we Really Don’t Need Any More Highways In The ‘Burbs.

Now, be honest. Which one of the three scenarios above do you find least likely?

YES, EVEN IF GAS TRIPLES IN PRICE, SUBURBANITES WILL STILL DRIVE. THE OIL PEAK IN THIS SENSE DOESN’T ****MATTER****. The people out there in Circle C aren’t going anywhere in the short term, and it’ll be decades before their neighborhoods are redeveloped in a less car-dependent fashion, assuming we can afford to.

The Big Talk About Toll Roads – Part One

Yesterday’s enjoyable lunch with Dave Dobbs reminded me that I intended to write this short piece, entitled “Why You Should Support (At Least Most Of) The Toll Road Plan Even If You Hate Sprawl”.

So, there’s this big plan out there to build a bunch of toll roads. Well, not exactly. Realistically, the plan is to add toll lanes to a bunch of existing roads, and build a few new toll roads. The new toll lanes would be freeway-quality; some of the existing roads’ capacity would be shifted to free frontage roads. This provides ammunition for the (false, but compelling) claim that existing roads are being ‘converted’ to toll roads, which I’ll explore in detail perhaps in a later posting.

The assumption is that if you care about the center city, and you hate sprawl, that you should be against this plan. Well, I love the center city. I hate the suburbs. I think gas needs to be a lot more expensive. I ride my bike to work a couple days a week. And yet, I’m going to support this plan.

Most of this plan was already on the books in one way or another. For instance, the long-range CAMPO plan always had an upgrade planned for Loop 360 (usually “expressway 6”, meaning 6 lanes and probably some more grade separation; by CAMPO’s terminology “expressway” indicates some separation but still some traffic lights). That means that sooner or later, these roads would have been built, with a combination of woefully underfunded state gas tax dollars, CAMPO-controlled federal gas tax dollars, and a dollop of city, county, and even Capital Metro funding from property and sales taxes.

Read that again. Most of these roads would be built anyways. That’s the first assumption you need to buy into in order to support these toll roads, and some people simply don’t. That’s fine, but at least understand the reasoning before you go on.

Why would these roads be built anyways? 99% of the drivers in this area think we don’t build enough roads. Yes, they’re wrong. Yes, informed people disagree. But those drivers are 99% of the population. You’ve got a lot of work to do to change their minds. I say good luck to you sir.

So, we’re stuck between choosing a slow buildout of free freeways like the US 183 creeper northwest, or a quick buildout by some other means. Some people suggest simply raising the gas tax. While this would address the impact on non-drivers (I, personally, hate the fact that City of Austin general fund monies go to pay for roadways like US 183 which not only don’t provide pedestrian accomodation, but are actively hostile to later accomodation – future paper on this subject to come), it doesn’t address the city/suburb equity problem.

Consider this: if I drive 10 miles through the city on S 1st St., Lavaca, Guadalupe, and Lamar; and my vehicle gets 20 mpg, I pay about 18 cents in gas tax, about a dime of that to the state. If my friend drives 10 miles through Round Rock on FM 620, he pays 18 cents in gas tax, about a dime of that to the state.
However, the state gas tax money (and the overwhelming majority of the federal gas tax money) is dedicated to roadways like FM 620. In fact, the state gas tax money cannot, by law, be spent on city roads (even major arterials).

So what’s the big deal? Look at a bunch of streets sometime and see what roads have route symbols on them and what don’t. (You might be fooled by Loop 343 through town on some maps – that’s old data; the signs on the street are the only reliable judge). Anything with a “SH”, “FM”, “RM”, “Loop”, “US”, or “Interstate” on it is getting gas tax money. Anything without is not. In most cases, not even federal gas tax money (on average, one major non-state-highway project per year gets a dollop of federal gas tax money through CAMPO’s process).

So most of the big roads in the City of Austin don’t get any gas tax money. This means that they must be funded by property and sales taxes. For instance, if one was going north from the river and looking at major E-W routes, all downtown streets (including Cesar Chavez); all numbered streets; Anderson Lane; Steck; basically every road between the river and US 183 with the exception of FM2222 is paid for by the city. And the same is true for N-S routes – such as Burnet Rd (south of US 183), Lamar Blvd. (ditto), Guadalupe, Red River, etc.

On the other hand, towns like Round Rock and Cedar Park have a much higher proportion of their infrastructure as signed and marked state highway routes (or US, which is really state under the covers). Go drive around and check it out if you don’t believe me.

So the gas tax is inequitable to city drivers and encourages sprawl. Most of the gas tax money you pay while driving around Austin goes to the ‘burbs.
So building these roads by increasing the gas tax is a bit more optimal than what we do now, but not much.

Finally, there’s the choice of tolling the roads. This, at least, only hits the people who use the road. So the people who chose to live in areas which now must be served with expensive roadways pay for the trouble, at least. And the future option exists to use this toll money to improve other modes of transportation (again: the state gas tax, by law, cannot be used on anything but highways; tolls have no such restriction).

So what about the argument that these toll roads will encourage more sprawl? Well, it’s possible. There’s two basic subarguments here, that I’ll address quickly:

  1. That adding capacity, even toll capacity, encourages people to move further out. I do believe this to be the case – but it’s less of an effect than adding free capacity would have been. And as said above, I don’t believe that not adding the capacity at all is a realistic option given the feelings of 99% of drivers.
  2. That the interests holding the bonds will have an economic incentive to produce more development in these areas in order to ensure adequate economic return (i.e.: the guys loaning the money need to make sure the supply of drivers fills the tollbooths). I find this less believable, because I think that most of the projects in this plan are going in corridors where sufficient demand for improved travel already exists, as long as the tolls are relatively low. Ironically, a toll project which sailed through with far less opposition (SH 130) seems to me to be a much worse bet. I have no problem believing current drivers will pay tolls today to travel up and down Loop 360 at twice current speed, in other words; but I don’t believe SH 130 is going to fill its coffers anytime soon.

The final bit is to analyze the projects and see which ones make sense and which might not, although I’ve already said that I think that at least one project under construction (SH 130) is worse than any of these. The RMA doesn’t want us to think this way, because they’re relying on an economic package consisting of all of the roads put together (i.e. they think they need the dollars from the better ones to pay for the weaker ones, and they need the capacity from the weaker ones to feed the better ones). This argument, while I disagree with it, is more defensible than many would have you believe – it’s the same argument transit supporters use to support little-travelled late-night trips on major routes (am I going to commit to riding the bus if it’s not going to be there the one night I work late?).

But I’ll analyze them anyways, because that’s what I’m supposed to do. When I rate revenue, I’m assuming no new development of any kind (in other words, this is based on my subjective opinion of existing traffic demand).

Already underway:

  • US 183A – seems a poor candidate for revenue to me, but it was already approved.
  • SH 130 – very poor candidate for revenue, but it was already approved.
  • SH 45 N – good candidate for revenue, already approved.
  • Loop 1 N – good candidate for revenue, already approved.
  • SH 45 SE – marginal candidate for revenue, already approved. (Remind me to write an article about the 45 naming sometime – TXDOT is still keeping alive the Outer Loop through shenanigans like this).

New proposal:

  • “Y” in Oak Hill – SH 71 phase – very good candidate (neighborhood very opposed since they assumed they were getting free capacity, but this does NOT qualify as “converting a free road”)
  • US 183 in East Austin – very good candidate (airport traffic tends to seek predictable routes even at higher expense)
  • SH 71 Southeast Austin – very good candidate (same as above)
  • Loop 1 S (SH 71 to William Cannon) – dubious candidate (short segment, unclear how feasible tolling it wll be). Seems like a stupid idea to toll a small segment in the middle of a long free stretch.
  • SH 45 S from Loop 1 to 1626 – dubious candidate, and opposed by the City of Austin.
  • “Y” in Oak Hill – US 290 phase – same as 71 phase.
  • Loop 360 – Bee Caves (2244) to Walsh Tarlton – very good candidate.
  • Loop 360 – remaining segments (as franchise) – would be good candidates. I don’t understand the desire to have one part of this road operated by the RMA and the rest by a franchise – this seems stupid (would be better to do it all one or the other).

OK, back to work.