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Why You Should Be Angry About CA’s “Highest Gas Tax in the Country”

I know it’s tempting to gloat.

Today, newspaper headlines are blaring the news that with the newest increase in the state’s gas tax, that California now has the highest gas tax in the country.

As I said, I know it’s tempting.

But, it’s the result of bad policy. None of the money from that increased gas tax will go to fix California’s crumbling infrastructure, or restore and fund any local transit system, or paint an inch of new bike lanes. It’s all going to the general fund, thanks to Arnold Schwarzengger and a short-sighted legislature.

To balance the state budget in 2010, Governor Arnold Schwarzenegger proposed, pushed for, and eventually signed a law that changed the tax structure for gas taxes with a so-called “fuel swap.” The new tax structure eliminated the sales tax on fuel and raised the excise tax. The purpose of the change was to eliminate funds that were dedicated towards transportation from the gas tax so that the Governor could balance the state budget with fewer cuts elsewhere and no tax increases.

After years of Governors Schwarzenegger and Gray Davis “declaring a fiscal emergency” to basically rob transit operations funds that were dedicated by voters in 2002 and 2006, the State Supreme Court ruled that there had to be an actual emergency, not just a lack of political will, to declare and emergency. It was at this point, that Schwarzengger devised the “fuel swap” plan.

The program also allowed the state to raise gas taxes so that the amount collected remains static even as the amount of fuel consumed decreases. If this meant a consistent level of funding for transit and road repair projects, the program might be more popular and useful.

But it doesn’t. As George Runner, a member of the state Board of Equalization that approved today’s increase noted when he voted against it, “The goal of the fuel tax swap wasn’t good  tax policy. Instead, its sole purpose was to allow the Legislature to move more than a billion dollars in gas tax revenues into the state’s general fund.”

The plan was met with scorn by newspaperstransit advocates and environmentalists when it was proposed. Today’s news is just the by-product of that bad decision.  Read more…

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Gov Signs Transit Funding Bills, Money Coming for Local Operators

sacto_capitol.jpgPhoto: hanneorla

California
transit operators are poised to receive a temporary infusion of $400
million in cash from the state for operating funds, a move that could
defray immediate shortfalls and set up a steady stream of state money
for the foreseeable future.

Governor Arnold Schwarzenegger ratified last night the laws (ABX8 6 and ABX8 9) that eliminate the gas tax, which included stipulations on transit funding,
and replace it with an excise tax. Despite the removal of the transit
funding mechanisms in the gas tax, these bills ensure that transit
operators have steady funding for operations by using the sales tax on
diesel to replenish the State Transit Assistance Fund (STA).

The
governor had declined to sign the transit operation funding bills that
transit advocates and lawmakers crafted to match his own budget
proposal. San Francisco Mayor Gavin Newsom last week decried the news
that the governor hadn’t signed the bills as a "back-breaker" for Muni
and said that by signing the bills, Schwarzenegger would have been a
"transit hero, at least for the week, until there are other cuts the
next week."

"We see this as making great progress toward
establishing stable and reliable transit operating funding," said
California Transit Association (CTA) Spokesperson Jeff Wagner. "While
it eliminates sources of funding that transit should have been getting,
it will create a source of funding that will provide transit with far
more than it has been getting, on average."

According to the
CTA, the laws signed by Schwarzenegger will establish a baseline of
$350 million each year for transit operations starting in 2012, with
allocations projected to reach $400 million in 2016-17 and $500 million
in 2020-21. Compare that with the average annual STA allocation of
$258.5 million over the last five years and $189.9 million over the
last ten years and operators could see light at the end of a long
tunnel of state transit raids.

In San Francisco, the MTA
would receive $36 million both this fiscal year and next — not enough
to fix the projected deficit of $50 million next year, but certainly a
welcome shot in the arm. MTA staff and the agency’s Board are still
evaluating the impact of the windfall on the current budget year,
including whether to use the funds to partially or fully stave off
planned 10 percent service cuts.

Read more…

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CA Transit Operators Hopeful State Diesel Tax Will Create Stable Funding

When Governor Arnold Schwarzenegger proposed eliminating the sales tax on gasoline in his new budget, transit operators and advocates saw the announcement as a move to subvert a California Supreme Court ruling that required the state to stop raiding transit funds.

Rather than comply with the court's ruling, they argued, the Governor was eliminating the voter-established rules that required the state to fund transit operations with the sales tax on gasoline. Nevermind that several of those ballot initiatives passed by more than two-thirds margins and put explicit restrictions on how taxpayer money could or couldn't be used for transportation projects.

Now many of those transit operators are supporting two bills (ABX8 6 and ABX8 9) that would do as the Governor proposed by eliminating the sales tax on gasoline, but would retain the sales tax on diesel. Rather than cry foul, lobbyists for those operators worked with legislators to develop the bills.

California Transit Association (CTA) Communications Director Jeff Wagner said with the legislature and the Governor thwarting the law and the will of the voters for years by raiding the the State Transit Assistance fund (STA), which is fed in part by the sales tax on gasoline (as well as the sales tax on diesel and other sources), and with Supreme Court rulings in the CTA's favor doing little to change the situation, his organization was taking steps to secure some kind of steady state funding for operators.

"Our fundamental position is in opposition to the elimination of the sales tax [on gasoline], but that has long seemed a foregone conclusion," said Wagner. "Given that lay of the land, we've worked with the legislature to get some level of funding for public transit. What this package does give us is the ability for transit to get funding that it isn't currently getting."

Read more...

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Hummer Going the Way of the Dodo

The days are numbered for the military vehicle that carmakers turned
into the bane of pedestrians, cyclists and planet Earth. GM has
announced plans to wind down Hummer production
after a deal to sell the brand to a Chinese manufacturer fell apart.
According to the Times, the Chinese government wanted no part of Hummer
because it is "trying to put a new emphasis on limiting China’s
dependence on imported oil and protecting the environment."

A Hummer H2
weighs in at more than 6,600 pounds, measuring about 17 feet long by
6.75 feet wide. Anyone with a plain old driver’s license can pilot one
on crowded city streets. Evidence suggests that laws should be amended to protect the public from such a risk. Now, at least, there will gradually be fewer and fewer chances to wield these civilian tanks where they don’t belong.

Video of Arnold testing out the first civilian Hummer via complex.com.

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Schwarzenegger Proposes Making the 405 a Double Decker Freeway

To the casual observer, Governor Arnold Schwarzenegger seems like an environmental crusader.  He signs anti-sprawl legislation, he sues the federal government over emission standards for automobiles, he flies around the world to attend greenhouse gas conferences.

But to those of us that live here and have been working to clean and green our transportation system; the Governor’s track record has been somewhat lacking.  We roll our eyes at his daily jet commute and react in horror at his efforts to roll back environmental protections in the name of environmental progress.  Yesterday, the Governor attended a press conference at the site of the most expensive highway project to be funded with Stimulus funds and unwittingly removed any doubt that he doesn’t understand the connection between freeways, the environment and public health.  From the Daily News:

“This is why it is so important because we have this bumper-to-bumper traffic to go and build an extra lane and build out the 405 freeway,” Schwarzenegger said at a news conference at a Caltrans construction yard along Mulholland Drive. “And hopefully, eventually, we will build on top of the 405 Freeway because I think we
need another freeway on top of the existing one.”

Read more…

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Times: Metro Should Raise Fares

1_26_10_bus_stop.jpgThe Times wants to raise fares on transit riders. Photo: Pgsvenk/Flickr

In today's Los Angeles Times, the local paper of record follows up on this weekend's look at Metro's operational funding crisis with an editorial urging the Metro Board to increase fares to help close the agency's roughly quarter of a billion annual deficit for 2011.

To be fair, the editorial strikes a lot of the right notes.  It does talk about the Metro's relatively low farebox recovery ration, the major problems with the state's yearly grab of operating funds, and the pain felt by all Angelenos if transit riders feel forced into their cars for their commutes or other trips currently made by transit.  But, the only solution offered for fixing the $250 billion deficit is fare increases.  From the editorial:

In most big U.S. cities, it costs at least $2 to ride the bus, and big-city transit agencies typically make enough from fares to cover about 40% of their operating expenses. In L.A. a one-way ride costs $1.25, and fares cover only about 26% of the MTA's expenses. The fare will jump to $1.50 in July, but that still won't be enough to make up for the budget shortfall. One solution would be to impose an annual schedule of hikes to put fares in line with other cities and allow them to keep up with inflation. Ridership would probably fall in the short term, but such fare-based plunges seldom last long; moreover, L.A. bus and rail riders are going to have to pay their fair share of the costs if they want to avoid deep cuts in service.

Read more...

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Times Covers Coming Metro Cuts, Avoids Mentioning Pols By Name

Over the weekend, the Los Angeles Times took a look at the coming budget crisis at Metro.  The article just scratches the surface of the issue, correctly noting that there are a lot of reasons for the quarter of a billion dollar operating deficit including the state’s budget grabs, lower than projected sales tax revenue and an 8% decline in ridership from Metro’s record setting year in 2008.

However, while the article is very clear that over $150 million of the $250 million deficit comes from the state’s grab of a fund dedicated to transit operations, it doesn’t name names for who it to blame for that raid.  The word "Schwarzenegger" doesn’t appear.  And, to be fair, while Los Angeles County is home to the last two Assembly Speakers, the current Chair of the Assembly Transportation Committee, and Chair of a Transportation sub-committee that deals with funding issues; none of these leaders are mentioned or quoted.  Assembly Members Fabian Nunez, Karen Bass, Mike Eng, and Michale Feuer, take a bow.

As has been noted several times, one of the reasons the debate on the Governor’s current transit raid is receiving such a frosty reception compared to previous years is because the press is covering the impact transit cuts state wide are having on riders, especially those that are transit-dependent.  The next step is for the press to start naming names, so that you don’t have to read transportation blogs to be able to pin the blame on the Donkeys and the Governor.

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Gov.’s Newest Transit Raid Receiving a Frosty Reception

1_21_10_gov.jpgSchwarzenegger at October’s Alt-Car Expo in Santa Monica. Photo: Automobile Blog

As Governor Schwarzenegger presses forward with his newest scheme to rob funds dedicated to transit, he’s receiving a frosty response from legislators and opinion makers that could spell doom for this plan to balance the budget. 

After the State Supreme Court agreed with every other court to rule on the merits of a lawsuit brought by transit advocates against the Governor’s recent transit raids; the Governor proposed doing away with the portion of the state gas tax that goes towards transit permanently and replacing it with a new tax for the general fund.  Knowing such a plan would face fierce opposition, the Governor tried a little "transportation user warfare" by having the new tax actually be five cents lower than the current one; forever burying any belief that the Governor cares at all about transit, transit riders or vehicle-created pollution.

The good news?  It’s more than just transit advocates that are calling b.s. on the Governor’s plan.

The NRDC Switchboard reports on a Senate Committee on Budget and Fiscal Review that was flooded with opponents to the Governor’s scheme and found their complaints echoed by the legislators who would have to approve it.  Long Beach Senator Alan Lowenthal is quoted as one of the leading voices against the plan:

It’s nice to go to a hearing in Sacramento every once in awhile and find
yourself in a cloud of nearly universal agreement.  I was able to
experience that rare feeling earlier today when the Senate Committee on
Budget and Fiscal Review held its hearing on Transportation and
Resources Issues…

…Senator Alan Lowenthal was “appalled” by the proposal’s impact on
transit; Senator Mark Leno told of San Francisco’s continued transit
funding problems and wondered how this proposal would help things; and
Senator Joe Simitian wisely pointed out the likely ridership impacts of
further cuts and fare hikes, particularly on those “discretionary”
riders who will once again choose their cars, leading to more air
pollution and road congestion. 

Meanwhile, an editorial is making the rounds of several Northern California newspapers pointing out that there’s more that would be loss in the Governor’s plan than just another round of transit riders v motorists.  From the Contra Costa Times:

The revenue shift would
take hundreds of millions of dollars away from transit systems at a
time when they are in dire financial straits.

Even worse, it
would result in a 1.6 percent reduction of Prop. 98-mandated school
funding, or about $800 million, according to the Legislative Analyst’s
Office. What about the governor’s pledge not to once again decrease
funding for K-12 schools?

The Governor’s plan is far from a "Done Deal" or a "Dead Deal" at this point, but based on the early returns; it appears that transit riders and advocates are starting ahead in the game and this time they’re not alone in the fight.

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Dodd and DeLauro Vow to Get Infrastructure Bank Done This Year

Supporters from every corner of the transportation universe joined
Gov. Ed Rendell (D-PA), Rep. Rosa DeLauro (D-CT), and Sen. Chris Dodd
(D-CT) today at a press event aimed at jumpstarting a National
Infrastructure Bank (NIB), which the two Connecticut lawmakers vowed to
steer to passage this year.

20080113rad_rendell_330.jpgGov. Ed Rendell (D-PA), above, founded BAF with the mayor of New York and the governor of California. (Photo: Post-Gaz.)

Dodd, who chairs the Senate Banking Committee and has announced
his retirement as of 2011, said today that he is "determined, in these
remaining 12 months, to do everything I can to make sure [the NIB]
becomes the law of the land."

DeLauro’s NIB bill,
which boasts 44 cosponsors in the House, would set up the bank as a
government-owned entity with its own board of directors. The NIB could
issue bonds, borrow money, and lend the interest it earns on financed
debt to encourage public-private partnerships on projects ranging from
transit to broadband to clean energy.

A Senate version has yet to emerge, but Dodd has spearheaded similar legislation in the past and said today that he plans to move quickly, holding a hearing in the Banking panel next month.

In addition, Rendell told Streetsblog Capitol Hill in December that he believes the NIB could advance as part of the Obama administration’s broader job-creation effort.

The Pennsylvanian’s infrastructure advocacy group, Building America’s Future,
marshaled groups as disparate as Transportation for America, AASHTO,
the liberal Campaign for America’s Future, and the libertarian Reason
Foundation to sign onto the NIB push.

"From mass transit to
water development systems, we are still reaping the benefits of massive
infrastructure investments," DeLauro said today, adding that a similar bank in Europe lent more than $80 billion in 2008.

Dodd and DeLauro’s enthusiasm gives the NIB an undeniable leg up in a year that could see
Democrats narrow their focus to legislation with a chance of securing
bipartisan backing. But significant hurdles remain, including
differences of opinion over the best vehicle for, and the long-term
effects of, the Bank.

Read more…

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LADOT Outlines Massive Cuts, Fare Hikes, for DASH

1_11_10_dash.jpgThis route won't be alone in seeing a cut...but at least it survives. Photo: rjmconnel/Flickr
For much of the last year, Los Angeles' transit riders were spared much of the suffering caused by the Governor and legislature's decisions to eliminate transit funding in the name of partially closing the yawning chasm which is the state's budget deficit.  However, those days are long gone.  Already we've seen a large service cut plan passed by the Metrolink Board of Directors.  Today we see the outline of a coming massive service cut for LADOT's DASH, Commuter Express, Charter Bus, and City Ride bus services.

In a letter to Neighborhood Council's, LADOT General Manager reminds the communities of the $350 million structural deficit over the next decade for the transit lines, $23 million of which comes in the next year.  You can read the brochure included in the letter to the Councils here, or read on after the jump for a breakdown of the cuts and hikes by service. Prepare yourself, the word "draconian" came to mind while digesting the changes, although it's not like they have a lot of choice while our jet-setting state leaders terminate transit funding.  Oh, and good luck finding news of the cuts on the LADOT main site or transit services site.  (Update: You can now find them here: http://ladotlbl.tmdinc.net/recommend.htm)

To register your outrage or try to save your line of choice, you have three options.

1. Internet –Go to http://ladotlbl.tmdinc.net

2. Telephone & Leave Message – Call (213) 455-0880

3. Mail – Send your comments to
LADOT, 201 North Los Angeles St.,
Space 18B, Los Angeles, CA 90012

Public hearings have not been scheduled, but will probably be held next month.  A final review of the of the plan will come before the City Council this Spring and the changes will go into place in July.

Read more...