Should Parking Lots Be Taxed to Fund Bike Paths?

One former state transportation director thinks so. The revenue would provide a steady stream of funding for public transit and bike path improvements.
by | January 8, 2013
 

Massachusetts Gov. Deval Patrick is expected to introduce in the coming days his plan for shoring up transit and road funding in the Commonwealth. His former transportation director has been offering some ideas too.

James Aloisi, who served as Massachusetts Transportation Secretary in 2009 for less than a year, recently wrote a three-part-series outlining his thoughts on how the state can help fund transportation projects, and in particular, end the massive shortfalls facing the Massachusetts Bay Transportation Authority.

Among his proposals: taxing parking lots and garages through a system he calls "carbon impact parking assessment." Here's how it would work.

Aloisi envisions the tax being levied on nonresidential parking lots and garages of more than 20 spaces within the MBTA district. The tax could be part of a new system of Transit Improvement Districts -- targeted areas within a community that depend on public transportation for success.

Revenue from the parking tax would provide a steady stream of funding that could then be invested in the public transportation system as well as bicycle and pedestrian pathway improvements.

Aloisi says he isn't aware of any jurisdiction that uses such a system, but it's similar to the idea of tax incremental financing, in which increased property tax revenue that results from development in a given area are then re-invested in the same place.

Aloisi says the plan would mitigate the environmental impact of automobiles while providing funding for other modes of transportation and ensuring that funding remains locally controlled.

Such a plan would almost certainly face political obstacles and fuel the ongoing debate between drivers and transit advocates. "I don't think it's about a war on cars," Aloisi says. "Maybe we should have a war on fossil fuels."

"It's really (about) the impact of fossil fuels on the environment, on our energy security, and on our ability not to innovate that I think is at the core of the issue."

Parking taxes are not unusual in major cities, but at times, they have been politically unpopular. Last year the University of Scranton sued the city of a new tax on parking garages and lots. Chicago Mayor Rahm Emanuel has enacted a $2-per-day "congestion fee," met with many grumbles, on downtown parking to help fund investments in transit and bike lanes.

Aloisi says the fee could be enticing to private-sector financiers, as a steady revenue stream is the type of thing that can help facilitate public-private partnerships.

Transportation funding is poised to be one of the key topics addressed by the state legislature in Massachusetts this year. The state's primary source of transportation funding, a 19-cent gas tax, has been unchanged since 1993.

Patrick has kept the details of his soon-to-be-released plan close to his chest, but it will seek to close funding gaps for the transit system in the Boston area. The governor's attempt at increasing the state gas tax in 2009 wasn't successful, and the legislature instead opted to dedicate an increase in sales tax revenue to transit and roads. That funding has been insufficient to address the state's transportation needs.

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