Paying for Roads

With the General Assembly looking into fixing the mess they made last year with the HRTA plan, it is a good time to reconsider how we should be paying for roads and other infrastructure, and how we have strayed from those traditional principles of good government.

The tradition, based in justice and sound economics, was for roads to be paid for by user fees rather than general taxes on income or property.

Roads, bridges and tunnels of general use to the public are most easily financed by fuel taxes, which automatically placed the heaviest burden on those who use the roads most.

But this is not a good way to finance roads and infrastructure that is of primary use to some limited segment of the public. The so called 3rd crossing is an excellent example, as it is being built almost entirely for the use of the trucking interests serving the Port of Virginia. The fuel taxes paid by the trucking interests don’t even cover the subsidy taken from the Transportation trust Fund (4.3% of our fuel taxes) for the operations of the Port of Virginia, much less pay their fair share of the $4.2 billion project. The HRTA transfers that burden to Hampton Roads taxpayers in the form of grantors fees and assorted special taxes. Projects like this should be paid for by those who benefit most from them, and the best way to do that is through bonds retired by tolls collected at the entrance to the connector, just as the Chesapeake Bay Bridge Tunnel was financed 50 years ago. With modern technology (see Texas121 ) tolls can be collected with no impact on traffic flow.

Similarly, roads being built for the purpose of development, like the proposed Southeastern Parkway, do not benefit the general public and should be self financed, either through tolls, impact fees or a Tax Incremental Finance District in the developed area, or a mixture of the two. The Southeastern Parkway should NOT be financed by tolls on other roads like I264.

Instead of considering the multiple projects lumped into the HRTA plan as one obligation financed by a mixture of taxes and tolls, each project should be considered and financed individually in accordance with those principles. With the 3rd Crossing and the associated lane additions self financed by the trucking interests who will benefit from them, and the Southeastern Parkway financed by the developments it will enable, the remaining projects can easily be financed with existing fuel tax funds, especially if we stop plundering fuel tax funds for other uses, like the Port of Virginia subsidy (4.3%) and Mass Transit boondoggles (14.7%)

A return to the just and economically sound practices for funding transportation we followed until special interests seized control of the process through the creation of MPO’s and Regional Planning District Commissions would provide for our transportation needs efficiently and in a more timely manner, as self-financed projects will not have to wait in line for public funds and those which are economically unsound will not be built at all.

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One Response to Paying for Roads

  1. Taxes says:

    […] unknown wrote an interesting post today onHere’s a quick excerptWith the General Assembly looking into fixing the mess they made last year with the HRTA plan, it is a good time to reconsider how we should be paying for roads and other infrastructure, and how we have strayed from those traditional principles of good government. The tradition, based in justice and sound economics, was for roads to be paid for by user fees rather than general taxes on income or property. Roads, bridges and tunnels of general use to the public are most easily financed by fuel taxes, which automatically placed the heaviest burden on those who use the roads most. But this is not a good way to finance roads and infrastructure that is of primary use to some limited segment of the public. The so called 3rd crossing is an excellent example, as it is being built almost entirely for the use of the trucking interests serving the Port of […] […]

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