New Study Calls for Focusing HSR Investment in Northeast and California
The Lincoln Institute of Land Policy is out with a new study titled “High Speed Rail: International Lessons for U.S. Policymakers. One of its authors, Petra Todorovich of America 2050, is also a leading high speed rail advocate who has done some excellent work in DC. But here she and her team have put together a good overview of HSR internationally and what lessons could be learned for the US.
In a meeting in Boston to unveil the study, Todorovich had a good perspective on the recent political problems HSR has faced in Congress:
“We see this as a generational investment, and minor setbacks from year to year are completely to be expected,” Todorovich said. “The interstate highway system did not get started until a dozen years after it was proposed.”
Not only does the study call for focusing American investment on the California and the Northeast Corridor HSR projects, owing to their population and existing passenger rail ridership, it also lays out some possible federal funding mechanisms:
• Raise the gas tax by 15 cents a gallon or more. Each additional cent of gas tax generates approximately $1.4 billion annually. Several cents could be devoted to passenger rail.
• Add a $1 surcharge on current passenger rail tickets to produce approximately $29 million annually. Though this is a relatively small amount of revenue, it could become an important source of funds for expanding and maintaining the system as passenger rail ridership grows.
• Or, shift from a national gas tax to a percentage tax on crude oil and imported refined petroleum products consumed in the United States to fund all the nation’s transportation needs. RAND estimated that an oil tax of 17 percent would generate approximately $83 billion a year (at mid- summer 2010 prices of $72 per barrel). Five billion dollars of this amount could be dedicated to passenger rail.
Alternatively, if the federal government switched from the current gas tax to a tax based on vehicle miles traveled (VMT) and two-tenths of a penny per mile were dedicated to passenger rail, $5.4 billion could be generated every year. The VMT tax as a source of transportation funding is supported by many transportation policy leaders, but has been disavowed by the Obama administration.
Former Interior secretary and Arizona governor Bruce Babbitt has proposed that a gasoline tax surcharge in the Northeast Corridor states could pay for high-speed rail in that region. This alternative has the advantage of explicitly linking the revenue sources to beneficiaries of the system. Other regional taxes, such as a payroll tax on businesses along the corridor, could also be considered. Such a tax is now used in downstate New York to help fund New York City Transit.
While Tea Party control of the House means none of these stand a chance anytime soon, the underlying need to invest in sustainable transportation does mean that eventually one or more of these will be adopted in order to help fund high speed rail.
One possibility would be for a shift in the California gas tax to one based on vehicle miles traveled. Of course, VMT is either stagnant or in decline in many places in California, so this wouldn’t necessarily grow in revenue over time. But it could be an additional source of revenue, and transportation officials in California, Oregon and Washington have already endorsed the concept.
Overall the report doesn’t break much new ground, but as an overview of the policy options available, it is a very worthwhile document.