Since the Maryland legislature begins its 2013 session this week, the natural question is, which taxes does Governor O’Malley plan on trying to increase? Media speculation has centered on a renewed attempt to hike the gas tax in order to replenish the state’s transportation trust fund.
Last year, O’Malley sought to phase in a 6% sales tax on gasoline, effectively raising the per-gallon price about 7 cents per year for the next three years. A transportation funding shortfall results, in part, from $1.1 billion in raids on the fund to pay for other projects, as well as a reduction in the share of mass transit operating costs covered by fare box revenues.
These raids occurred despite the state’s long wish list of expensive projects, including widening the Capital Beltway ($5.8 billion); replacing the Harry W. Nice Bridge connecting Southern Maryland to Virginia ($885 million); building the mass-transit Purple Line ($1.9 billion) in the Washington suburbs and Baltimore’s Red Line ($2.5 billion); widening Md. 5 in Prince George’s County near Clinton ($1.1 billion), and building the Corridor Cities Transitway rapid bus system in Montgomery County ($800 million).
Over $5 billion on the Governor’s wish list is for new mass transit projects. This reflects the long-standing ideological commitment of transportation planners to a theory that the only way to reduce highway congestion is to use mass transit to “entice” drivers from the roads. Nearly half of Maryland’s transportation spending is devoted mass transit despite the fact that cars account for approximately 97% of all travel.
These planning “experts” cling to their “diversion” theory despite compelling evidence that it does not work. After spending billions over the past two decades on public transit, Maryland mass transit’s increase of 52,000 daily commuters has been more than offset by a 62,000 loss in car pool commuters. Driving alone became substantially more popular, comprising 73% of all commutes in the state in 2008. Between 1990 and 2008, 93% (400,000) of all new commutes were by single-occupant automobiles. In fact, almost many as many commuters have been “diverted” from the roads by working at home (47,000), as were by mass transit.
In short, these planners cannot make good on their promise of less crowded roads in exchange for more mass transit spending. This should come as no surprise to anyone looking at a map and considering the distribution of jobs and homes. A century ago centralized job locations could be feed by convenient trolley lines within a 10 mile radius. Today our metropolitan areas now span thousands of square miles with population densities that cannot support widespread mass transit usage.
Microeconomic analysis has worked through the numbers in which single-occupant car drivers make an entirely rational choice in trading the higher commuting costs of a car for less time spent commuting. In effect, even a 5 minute reduction in commuting time is worth the equivalent of 2% of income.
To make matter worse, even when Maryland does build highways, it does so expensively.
Compare the state built Inter-County Connector with the private Dulles Greenway. Both are about the same distance. The ICC is 14 miles and the Dulles Greenway 13 miles. Both charge equivalent tolls. Both were built through largely undeveloped parts of the Washington exurban area. The Greenway was able to purchase all its land from the original owners at market prices, without resorting to commendation proceedings. The privately-financed Greenway cost $315 million to build in the 1990s, while the ICC cost $2.5 billion to build in the past decade.
Not only is the Greenway covering its capital costs entirely from tolls, as a private entity it pays millions in real estate property taxes each year. While the Greenway struggled in the early years, by 2005 ownership changed hands for a price nearly twice its initial construction cost.
Some of the eight- fold cost difference can be attributed Maryland’s reliance on antiquated labor contracting processes. Other added costs came from extra spending insisted on by environmentalists. Another problem is that weak transportation management has been a characteristic of the O’Malley Administration. For example the previous Maryland Department of Transportation Secretary announced in April that she would be leaving the cabinet post. Yet eight months later the Governor has yet to announce a replacement.
“This is very poor timing to have a rudderless ship,” comments Change Maryland’s Larry Hogan. He further notes that not having a permanent Secretary in place at the largest department in state government handicaps effective management.
Going forward, the first step in any discussion of Maryland transportation policy must be making more efficient use of existing resources and a reexamination of spending priorities.
Montgomery County Republican Chairman