Surreptitious Underfunding

One third of the MBTA’s outstanding debt, about $1.7 billion, comes from transit projects built by the state as part of a court-imposed mitigation for extra Big Dig traffic; interest on this debt is about two-thirds the agency’s total present deficit. Metra was prepared to pay for a project to rebuild rail bridges that would increase clearance below for trucks and cut the right-of-way’s width from three to two tracks. Rhode Island is spending $336 million on extending the Providence Line to Wickford Junction, with most of the money going toward building parking garages at the two new stations; Wickford Junction, in a county whose number of Boston-bound commuters is 170, is getting 1,200 parking spaces.

Supporters of transportation alternatives talk about the inequity between highway and transit funding in the US, but what they’re missing is that the transit funding bucket includes a lot of things that are manifestly not about transit. At their best, they are parking lots and other development schemes adjacent to train stations, which would’ve been cheap by themselves. At their worst, they are straight highway projects, benefiting road users only.

The situation in Boston, while unique in its brazenness, is not unique in concept. In the US, where there are no pollution taxes on fuel, the only way to mitigate air pollution is by regulation and by building alternatives simultaneously. Put another way, combined highway and transit construction is in most cases not really a combined project; it’s a highway project, plus required mitigation. Requiring the transit agency to shoulder the debt and the operating subsidies is exactly requiring transit users to pay for highways. It’s equivalent to charging transit multiple dollars per gallon of gas saved from any mode shift. And it may get even worse: the proposed House transportation bill includes a provision to allow spending national air pollution control funds on regular highway widening, in addition to the current practice of spending them on carpool lanes.

Historically, the diversion of funding from transit to roads took such insidious forms. For an instructive example from Owen Gutfreund’s book, roads advocates fought to get driver’s license fees and even inspection fees for fuel trucks recognized as road user fees, whose proceeds must be diverted toward roads. For another example from the same book, in Denver, the streetcar system was required to cover 25% of the cost of road maintenance on one-way streets and 50% on two-way streets, and as car traffic rose, streetcars both became slower and had to send over more money toward roads.

Another instructive case study is grade separations. It is to my knowledge universal that expressways and high-speed railroads, both of which must be grade-separated, pay for their own grade separations. In all other cases, who pays is determined by which mode is more powerful, and in the US, this is roads. As the national highway system was built in the 1920s, interurban railroads were required to pay for grade-separations, even when the rail came first. The practice continues today: in Kentucky, the railroad has to shoulder the full cost if it’s from 1926 or newer (Statute 177.110), and half the construction cost and the full planning cost if it’s older (177.170). In contrast, in Japan, grade separations are considered primarily a road project, and so the Chuo Line track elevation project was paid 85% by the national and city governments and only 15% by JR East (page 36). The segment in question of the Chuo Line was built in 1889; I believe, but do not know, that new rail construction in Japan is always grade-separated, at the railroad’s expense.

The situation in the US today is a surreptitious underfunding of transit, and at the same time a surreptitious overfunding of roads. It is not subject to democratic debate or even to the usual lobbyist funding formulas, but, like the obscure regulations that impede good passenger rail, hidden in rules nobody thinks to question. To pay for road mitigations and for parking, transit agencies will cut weekend service and reduce frequency. It’s bad enough when done in the open, but it’s done while claiming that transit is too expensive to provide.


  1. James Llamas

    Someone at METRO, I can’t recall who right now, told me that about 40% of the cost of those lines is going to utility and street reconstruction, much of which would have been necessary anyway.

    • Alon Levy

      For what it’s worth, in Nice, about a third of the cost of the tram went to street reconstruction. And then the cost per km figures make sure to include just the bit that went to constructing the actual tram. I don’t know who’s paying the interest, but I’d guess it’s the city in either case.

    • Alon Levy

      If it’s stimulus spending, it’s not part of the usual formula. It may be a part of the stimulus that was designated for transit, though – I don’t know.

  2. Richard Mlynarik

    A different way to look at this is that our “transit” agencies are, to a very large extent, earmark-delivery vehicles for public-private wealth transfer.

    Throwing in total street reconstruction and new sewer lines and a new police station and a community celebration gateway arch and street safety improvements all the grade separations you can eat is just a way of increasing the project budget controlled by the local apparatchiks.

    They don’t see that as a bad thing, I promise you.

    And since scoring earmarks (regional, state, or federal) is purely political and is entirely divorced from whatever nominal evaluation metrics may be advertised for show, the larger the budget and the more crap thrown in and, paradoxically, the less transit delivered (more scope for Phase 2!) the better for everybody who counts.

    Really, the system is designed for failure, and delivers exactly as promised, very efficiently.

  3. Ryan Richter

    I’ve seen instances of transit agencies using CMAQ (congestion mitigation air quality) funding for the construction of parking lots at transit stations. It makes no sense…

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  5. David Edmondson

    It’s interesting that DDOT functions as both transit and roads agency in DC, so this kind of split doesn’t apply for its streetcar project or the planned K Street Transitway.

    Another oddity in the region is the Silver Line, which has a great deal of funding provided by road tolls owned by MWAA, which is the agency actually building the line. Drivers aren’t too happy about it, of course, but Virginia gave away its power over the toll road so there’s nothing the state can do about it.

  6. Beta Magellan

    Past Tysons, the Silver Line essentially is a road project—with big park-and-ride lots everywhere, the Silver Line will function more like an extra lane of expressway than a train.

  7. Beta Magellan

    Nitpick: the track centers on the Metra line were a UPRR request—although widening them was included in the project, it’s unrelated to the bridge projects and comes from a different tradition of dysfunction.

    • ardecila

      Alon, Metra’s UP-N project is still going forward and still raising clearances. The only difference is that now Metra has agreed to increase the project cost to provide for a three-track ROW at the new, higher elevation, which includes various retaining walls and so forth. This is not because Metra wants or needs a third track, but because Metra caved when riders became irate at the schedule changes caused by the original plan’s single-tracking during construction.

      • Nathanael

        The third track will end up being needed; this is the Chicago-Milwaukee string of endless suburbs. But Metra hasn’t figured this out yet.

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  9. truthspew

    I can understand how streetcars might impact the road but 50%?

    You are correct – there is a built in bias against public transportation in the United States. One that needs to be corrected.

    Here’s a proposal – keep the gasoline tax in place, but also put in place a mileage tax. It would be technologically trivial to determine where a car is used (city street, state road, highway) so that an accurate distribution can disbursed to the entities responsible.

    • Richard Mlynarik

      Here’s a proposal – keep the gasoline tax in place, but also put in place a mileage tax. It would be technologically trivial to determine where a car is used …

      That’s simply insane.

      Taxes on gasoline are in fact perfect, except for being orders of magnitude too low.

      A small fee on sociopathic behaviour (CO2 emission) which is dedicated to increasing the scope for being a psychopath (building more freeways): only in America.

      Total surveillance of the movements of the population seen as both trivial and desirable: ditto.

  10. Alex B.

    Although, the only portion that the Feds are funding is the part through Tysons. It will contain one park and ride at Wiehle Ave, but the Tysons stations will have no parking.

    Phase II of the line will be locally funded, primarily via toll road revenues and local contributions. As a matter of getting the final funding agreements in place, they’ve been looking to cut costs for the second phase, which involved lots of compromises (such as putting the Dulles Airport station above ground and further away from the terminal), the primary one will be deleting the park and ride garages from the rail project’s budget.

    Those park and rides might still get built, but they’ll get built with local funds and will be paid for out of some other project’s budget.

  11. josepheisenberg

    I recall reading that, here in Portland, the original eastside light rail line funds also included repaving the parallel freeway, in the central portion. They went so far as to designate 84 a “transitway” to make this possible. I’m not aware of any transit buses that use the freeway at this time. (I can’t seem to find the source for this right now; I think it was a post on Portland Transport)

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  13. Nathanael

    Last I checked, the MBTA situation was even worse than you say, Alon.

    ANOTHER huge hunk of the MBTA “debt” is money which was declared to be MBTA debt at the founding of the MBTA. It was a computation made by the state legislature / governor based on the total sum of money which the state had spent *IN THE PAST* on mass transit, and it was just thrown onto the MBTA as “startup debt”, for the hell of it. This was state-owed money.

    Nobody would EVER do this with a highway project, saddle it with the previous 70 years of road spending as “debt”.

    • Nathanael

      Note that this is part and parcel of the state legislative habit of pretending that legislature-incurred general fund debt is “someone else’s debt”; New York has this down to a fine artform, but Massachusetts does it really blatantly.

    • Alon Levy

      Well, in France, they’re doing that to RFF – they transferred the old liabilities of SNCF from its money-losing days to RFF. In Japan they wanted to do that to the JRs, but realized that JNR had incurred too much operating debt and simply wrote that down and only made the JRs pay the Shinkansen construction debt.

      The question then is the relative amount of operating versus capital debt the MBTA got from the state. If it was anything like the MTA then much of that debt was things that really shouldn’t be considered capital spending, such as normal maintenance, but it could potentially include some extension projects that are legitimately the MBTA’s problem.

      Of course it would never be done with highways. Along with surreptitious underfunding of transit, the US also surreptitiously overfunds roads.

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