insurgent49
  updated weekly
 home - contribute - donate -  message board - events - links - contact us - archive
November 11, 2005
A Fuel Tax To Fund People Mover
by Brian Yanity, insurgent49

     Anchorage is in crucial need of more funding to support public transit. At present, the city has no plans or money to expand transit service. The abysmal current level of service is funded by federal grants that will run out soon.

     This is inexcusable, since increased use of public transit is needed to bring about the environmental and energy conservation benefits of reduced fuel use. Society has rights as well as individuals, and it is in the interest of society to phase out the use of fossil fuels.

     As required by federal law, every state in the US taxes the sale of gasoline and diesel fuel. According to the American Petroleum Institute, in 2004 the combined federal and state taxes in the US average 21.2% of the pump price of gasoline, and 22.7% of the pump price of diesel fuel. In 2004, the state of New York also has the highest gasoline tax in the nation at 58 cents per gallon, while Hawaii had the highest diesel fuel tax of 65 cents per gallon.

     These figures include both state and federal taxes. By contrast, Alaska had the lowest fuel taxes in the US at 26.4 cents per gallon for gasoline and 32.4 cents per gallon for diesel. In most European countries, more than half of the price paid at the pump for motor fuel is taxes, strategically used to encourage fuel conservation. What better way would there be to tax all those gas-guzzling tourists visiting Alaska in their inefficient RVs, not to mention all those cruise ships.

     To start, a 1% gasoline and diesel tax to fund transit should be introduced in the Municipality of Anchorage, with buses and other municipal vehicles exempted. As gasoline prices continue to rise, a 1% difference in price at the pump is insignificant compared to the ‘market-induced’ increase in price over the past year. In 2004, the annual People Mover budget totaled $10 million.

     If service (and the budget) were doubled, let us say to $20 million a year, most Anchorage residents could catch a bus every 15 minutes on most routes. This is the transit frequency needed to attract drivers out of their cars, and thus result in less congestion. To expand on this thought experiment, let us assume that there are 200,000 drivers in Anchorage, and each one spends an average of $1000 per year on gasoline or diesel, a conservative estimate.

     This in total represents about $200 million per year, 1% of which is $2 million. A 5% tax on gasoline within the Anchorage municipality, according to this over-simplified model, would rake in $10 million a year, enough to operate the present bus system entirely, with free bus fares! A 10% fuel tax in Anchorage, which would simply bring us up to the national fuel tax average, would generate $20 million a year for transit! In theory, that could bring us double the present People Mover service but without any fares.

     Using fuel taxes to fund public transit is also a fair subsidy from the richest to the poorest citizens of Anchorage. Low-income riders of People Mover are going to take the hardest hit with any transit service cutbacks. Here in Anchorage, fuel taxes are not regressive because there is a direct correlation (on average) between private vehicle commuter distance and income, the most glaring example being commuters from Hillside to downtown.

     The lowest income neighborhoods in the city (Mountain View, Fairview, Muldoon, Downtown, and Government Hill) are also the most dense and have the shortest commuting distances.  Here in Anchorage, it is an empirical fact that the wealthier the neighborhood is, the less dense it is, and more fuel is used per capita. You can just look at all those huge homes being constructed on big lots on the outskirts: Rabbit Creek, Jewel Lake, and of course Eagle River and Chugiak.

     The drivers of private vehicles will also benefit from increased transit spending, even if they never leave their cars. This is because reduced traffic congestion is a result of increased transit use. For example, in New York City, the Metropolitan Transit Authority uses tolls collected by motorists on the bridges and tunnels around the New York metro area to directly fund operation and maintenance of mass transit (buses, subways and commuter railroads), so that automobile drivers subsidize transit riders. New York City would simply not function without mass transit (everything would grind to a halt) and even suburban car commuters know this.

     The proposals described above will be called by many in Alaska as ‘politically unrealistic’. However, commuting 80 miles a day in a huge gas-guzzling SUV will not only be economically unrealistic for 95% of the population a decade from now, but downright foolish.

     Statewide, getting around $50 million per year to fund transit in Anchorage, Juneau, Fairbanks, Mat-Su, Ketchikan, and the Kenai Peninsula would really improve mobility for the majority of Alaskans. In 2004, the oil producers in Alaska took home $5.5 billion in profits, while the state government made $2.8 billion in oil revenues and the federal government $1.9 billion. $50 million represents just 1.7% of what the state of Alaska took in last year, and the price of oil (and thus state revenues) has jumped far more than that for this year.

     Public transit is here to stay, so get used to it. The citizens of Anchorage, and all of Alaska, need to start up a wave of grassroots activism to support more public transit development. Our future depends on it.





Brian Yanity is a student activist and freelance journalist who resides in an undisclosed location in Southcentral Alaska. He can be reached at byanity@insurgent49.com.
- Columnists -

Editor's Desk
by Aaron Selbig

Red Alert
by Soren Wuerth

Alaskan In Exile
by Neil Zawicki

The
Bramble Bush
by Kevin Morford





- also by this writer -
Copyright 2005 Insurgent Media. All Rights Reserved.
in-sur-gent (in sur'jent), n. 1. a member of a group which revolts against the policies of its leadership.