It Doesn’t Matter Who Pays for Roads

In any discussion about making space for alternative transportation modes – whether buses, trams, or bikes – the likelihood of someone retorting, “but drivers pay for roads!” quickly approaches 100%.

The implication here is that drivers have a special entitlement to road space on account of them being the primary (and some imagine, exclusive) financiers of roads. Those who don’t own cars – cyclists and public transit users – supposedly don’t pay for roads, and thus have little to no claim to use them, let alone demand exclusive space like a bike or bus lane.

I argue this is actually besides the point, but to labour this side point: numerous analyses have pointed out that the vast majority of drivers don’t come anywhere close to covering their road costs, whether through driver-specific fees, tolls, or taxes (and this is simply for infrastructure and maintenance, ignoring externalities and opportunity costs). In fact, in various jurisdictions, it’s non-drivers who are arguably paying too much for roads.

There are a few simple reasons for this. First, in most municipalities, roads aren’t funded through any driver-specific revenue stream, they are funded through property taxes – which everyone pays, car owner or not. Where driver-specific fees and taxes are earmarked for roads, they don’t cover full costs. In the U.S., on average, they cover about 39% (though this is highly variable at the state-level). The rest are covered through various kinds of non-driver-specific tax revenue.

But perhaps the most simple reason: for most people road use is subsidized. And for emphasis: driving is subsidized

When any service, resource, or infrastructure is funded mainly by taxes, the taxes that most users pay don’t cover their cost of use, whether it’s a park, a library, a school, or a hospital. Simply put: wealthier people subsidize less wealthy people. Where exactly you need to fall in the tax paying bracket to cover your public costs differs on jurisdiction (and how taxes are earmarked for different areas of the budget), but in general it’s well above the median. To be sure, there’s nothing wrong with this – in fact, it’s a good thing: this is how a functioning society needs to work.

So, who pays for roads? Everyone! But some people pay more. And most people don’t pay enough to cover their own road costs.

But here’s the thing: it doesn’t matter who pays for roads. Debating who is more entitled to use roads skips over a much more fundamental question: should we be building so many roads in the first place? (And roads designed in particular ways to prioritize car transport?)

Instead of, “Who is entitled to use road space?” a better question is, “How should we use this public space?”

Even if roads were funded exclusively through user-fees (which incidentally, would be a sure-fire way to get people to stop driving, since roads are enormously subsidized), it wouldn’t have any implications for this more fundamental question.

There are useful analogies. In Toronto (and other North American cities), there are several city-owned golf-courses. They run at a loss. But even if golfers’ green fees paid for the costs of operations (ignoring the real-estate value), would this in itself be a justification for reserving large swaths of public parkland for the use of some golfers? That same space could be put to innumerable other uses that could also be funded partially or entirely through user fees. Even if the golf courses generated revenue, it would still be a legitimate question to consider using that space for another purpose. Maybe we decide the golf course is a good use – but this should be a broader public discussion that involves more than just people who play golf.

This is not to say that financial considerations are not important, but rather, that they shouldn’t be tied to anyone’s sense of entitlement. We might want to ask, for example, what the costs of building and maintaining a car-centric transportation are compared to alternatives. As in the case of the golf course, we might want to talk about opportunity costs: what different experiences, activities, kinds of enjoyment are we losing out on because we have used this space in one way and not another?

We might also want to talk about different kinds of valuation. We don’t build parks or put up public art because it makes raw financial sense, but because they confer more intangible benefits: they signify what kind of city – what kinds of shared spaces – we want to be in. Compared to trying to determine how many square meters of the road one has a right to based on their tax contributions, these kinds of questions are ultimately much more fruitful.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: