betacity


underpays overpays
June 5, 2010, 6:00 pm
Filed under: Energy, Transit
Two neighbors each pay $300 annually in local taxes that fund roads and traffic services.  Mike Motorist drives 10,000 miles annually on local roads, while Frances Footpower bicycles 3,000 miles.  The table below compares the costs they impose with what they pay in taxes.
Table 4 Local Roadway Payments Versus Costs
Mike | Frances
A. Annual local mileage 10,000 | 3,000
B. Household’s general taxes used for road related services. $300 | $300
C. Motorist user fees spent on local road (0.2¢ per mile). $24 | $0
D. Total road system contribution (B + C) $324 | $300
E. Tax payment per mile of travel (B/A). 3.2¢ | 10¢
F. Roadway costs (cars = 5.6¢/ml, bicycles = 0.2¢/ml) $560 | $48
Net (D – F) Underpays $236 | Overpays $252
Non-drivers pay almost the same as motorists for local roads but impose lower costs. As a result, they tend to overpay their share of roadway costs.
 Whose Roads? Victoria Transport Policy Institute, Todd Litman
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