President Barack Obama has released the basic outline of his FY 2010 budget plan (which would actually go into effect on October 1, 2009) and it includes $5 billion for HSR over 5 years - or, $1 billion a year. Obviously that's not going to be enough to build any HSR projects around the country, but would maybe possibly provide a few drops in the bucket. As Yonah at the Transport Politic notes, the proposal "doesn’t appear to mark sea change in vision for U.S. mobility" but is subject to change in Congress.
The budget fight may well resemble the stimulus battle in some key respects, as moderate Democrats and the small handful of sort-of-moderate Republicans could unite to try and pare back some of the more ambitious moves Obama is proposing, including the attack on 30 years of neoliberal economic policy signaled by Obama's plans to start going after wealth through taxation.
A key issue is whether the budget requires 50 votes or 60 votes to pass - the absurd and undemocratic filibuster rule was what caused the weakening of the stimulus plan (despite the $8 billion for HSR), and if the budget is subject to the same 60 vote requirement, then the end product is likely to be significantly weaker than what Obama is proposing here.
Ultimately the real transportation policy battle may come when the transportation bill comes up for reauthorization later this year. A Congressional commission is calling for a higher gas tax and ultimately a vehicle miles traveled (VMT) tax, and while the Obama Administration backed off Ray LaHood's suggestions along those lines earlier this week, I suspect that may have been because they weren't yet ready to go there. We will see what happens later in the year.
Finally, it's great to have seen a lot of pushback against Republican HSR lies this week. It helped that Bobby Jindal made himself look ridiculous with his "Disneyland ride" comments - what he's actually wound up doing is inoculating HSR against that kind of criticism by implying HSR deniers think like Jindal does. Sort of a Sarah Palin "I can see Russia from my house!" moment. With Obama's approval ratings through the roof, and his administration finally showing signs of wanting to chart a truly new course in American politics, that creates the conditions to both grow and consolidate public support for high speed rail. There's a lot of opportunity here, but we'll have to push it through.
Note: I usually don't mind thread drift in the comments, but for now I'd ask folks who want to discuss the Peninsula HSR plan to keep it in yesterday's post for the time being, until I post again on the topic, which will likely be this weekend.
Friday, February 27, 2009
Obama's Budget Plan and HSR
Monday, February 23, 2009
LaHood: Expect More HSR Funds; MTC Funding Debate
UPDATE: As reported by the Transbay Blog the MTC is planning to apply for the Transbay Terminal train box funding to come out of the $8 billion HSR stimulus and not from the general transit stimulus funds. Debate continues over funding the BART to OAK - in addition to the Transbay Blog article (which opposes funding BART to OAK out of stimulus money) see more at Living in the O, TransForm, and the Calitics version of this post. The original post begins here:
Some great news out of the US Department of Transportation:
Transportation Secretary Ray LaHood today emphasized the administration's long-term commitment to expanding high-speed rail service in "five or six regions" of the country, not just with the $8 billion provided in the economic stimulus package President Obama signed into law last week, but also "in subsequent years a very substantial effort." Meeting with reporters earlier today, LaHood said that for Obama building high-speed rail networks is, "if not his No. 1 priority, certainly at the top of his list. What the president is saying with the $8 billion is this is the start to help begin high-speed rail projects." He added that the administration "is committed to finding the dollars to not only get them started but to finishing them in at least five parts of the country," although he declined to elaborate on where these projects might ultimately be built.
One of my lingering concerns about the Obama Administration has been that they might be tempted to claim victory with the $8 billion in HSR funding added to the stimulus and not follow up on that money, which as we know merely pays for some initial costs. But what Ray LaHood is saying is that in fact, the $8 billion in HSR stimulus really is intended as a signal to America that Obama is truly serious about building HSR.
This couldn't be better news for us in California, where we have long known that at least $15 billion in federal aid, spread out over 10 years, will be needed to build the SF-LA line. Unfortunately the news is tempered by the fact that the Obama Administration's support for HSR did not extend to mass transit as a whole. Here in California the state has decided to zero out the State Transit Assistance account, costing local agencies over $500 million in funding. The federal stimulus isn't nearly enough to make up the difference. And as the San Jose Mercury News reports, that's setting up a situation where HSR may be pit against local transit agencies:
The MTC meeting Wednesday in Oakland could turn contentious, as the current plan calls for allocating $75 million to help build the Transbay Terminal in San Francisco, which would serve as the final stopping point for a high-speed rail line and Caltrain, [NOTE: in fact the MTC now plans to get the train box money from the $8 billion HSR stimulus - see update at top of the post] and $70 million to build a BART spur to Oakland International Airport. Those two projects alone would take 43 percent of the $340 million headed to the area in stimulus funds for local transit.
Some want money for those new two projects scrapped or reduced — and redirected to cover the cost of paying for day-to-day transit needs.
But MTC officials counter that building the Transbay Terminal now will save millions of dollars in later costs, and combined with the $8 billion in stimulus funds set aside for high-speed rail could accelerate that program. California is a leading candidate to capture much of that money because voters in the fall approved a $10 billion bond measure to begin work on the line, which will someday extend from San Diego to San Francisco and Sacramento.
"Given that California is the only state to pass a bond to build a new high-speed line, we think we might be able to do some double-dipping there," said MTC executive director Steve Heminger. "We are going to spend the stimulus money fast. I can guarantee that."
I support using that money for the Transbay Terminal, although I'm less certain about whether BART to OAK is all that necessary; the AirBART buses work pretty well (I used them on numerous occasions when I was an undergrad at UC Berkeley, although that was 10 years ago).
But I really hate it when HSR pitted against other forms of transit. I have said it before and I will say it again - HSR and other mass transit need each other to be successful. It should not and must not be an either/or choice. I don't blame the MTC for being stuck in this position - that blame lies in Sacramento and Washington DC. But we transit advocates need to not fall out along modal lines.
I'd like to propose a solution, one that I don't even know is possible under state law but makes a ton of sense to me. The nine-county SF Bay Area region should implement its own gas tax, which will solely be used to fund public transit. I haven't penciled out the numbers so I don't know exactly what the tax amount should be, but it should be indexed to the price of gas, and not a fixed cent number.
This money would initially be used to backfill the loss of STA funds, and allow the federal stimulus money to go to new transit infrastructure such as Transbay Terminal or BART to OAK. Ultimately the STA funds must be restored by a statewide gas tax increase, but it is much more politically possible to implement a gas tax in the Bay Area first than to try and get the Central Valley and the Southern California exurbs to buy into this (they can be brought on board later, once the 2/3 rule is eliminated).
It's very difficult for folks living in the nine counties to evade the tax, with the possible exception of Gilroy residents who might drive to Hollister to fill up. Most folks will simply pay the increase rather than drive far out of their way to get a cheaper gallon of gas.
I'm not sure if this option has been explored by the MTC and the member counties, but it ought to be. It's a sensible solution that would not only help spare transit agencies from "Armageddon" but would itself be a long overdue policy shift that would give a real boost to transit efforts in the SF Bay Area.
Wednesday, February 11, 2009
Squaring the California Budget Circle
State senate Democrats are working on a counter-proposal that would avoid layoffs by increasing revenue via a package of emergency measures that would be in force for two years:
- increasing the state sales tax by 1%
- raising vehicle license fees from 0.65% to 1.15% of the value of the car or truck
- raising state gasoline tax by 12 cents per gallon
- collecting a surcharge of 0.25% of state income taxes owed
Of these, the proposals to raise the cost of operating a car or truck make the most sense to me. However, rather than increase the gas tax - which is tied specifically to highway infrastructure - I would advocate a "carbon fee" for gas and diesel that would actually start at $0.10 and then increase by $0.02 each and every month for ten years. At the end of the period, the fee would reach a whopping $2.50 per gallon - over and above existing taxes! Analogous carbon fees would apply to other fossil fuels, e.g. natural gas used in electricity generation. All of these would contribute into the general fund.
To compensate for this regressive measure, I would cut general sales and payroll taxes as soon as budget constraints permit, possibly followed by additional tax cuts later on. I realize that increasing the cost of fuel and other forms of energy is anathema to most Americans and, Californians are no exception. However, it is also the only proven way to make high fuel economy cars pencil out while also encouraging transit-oriented development, transit ridership, bicycle use, telecommuting and renewable electricity generation. Note that having a high fixed component in the cost of a unit of energy shields consumers from volatility in the underlying commodities. Fuel and utility bills would be higher to begin with, dissuading consumers from taking on excessive mortgage debt they can no longer service if the price of oil should rise sharply. Cheap energy boosts economic growth only until the inevitable asset bubble bursts. In the long run, it is a curse rather than a blessing.
Predictably enough, none of the Republicans in the state legislature has agreed to any tax hikes whatsoever, least of all those on gasoline. As card-carrying neo-Hoovers, they instead insist on spending cuts irrespective of the macroeconomic context. For their part, Democrats are loath to accept job losses in the highly unionized public sector. Unfortunately, the state has no leeway, as it is constitutionally required to balance its budget. Only the federal government is allowed to run deficits.
The bitter irony is that federal aid to states is exactly what "moderate" Republicans and Democrats in the US Senate have been cutting from the stimulus bill, arguing that states have failed to keep their spending in check in recent years. In effect, Congress - that paragon of fiscal rectitude - is forcing governors all across the nation to do the exact opposite of what their stimulus bill is supposed to achieve.
Meanwhile, MSNBC's Rachel Maddow points out that prisoners are the only people with a constitutional right to adequate health care. Three federal judges are about to rule that California's prison population of approx. 160,000 is currently underserved. That would force the state to either embark on a massive prison construction spree or, to release almost 60,000 inmates over the course of the next two to three years. The latter course of action is strongly opposed by, among others, the influential prison wardens' union.
The 2008-2009 state budget includes $10.3 billion for the Department of Corrections, which works out to approx. $64,000 per inmate per year. The RAND corporation estimates that the 1994 three-strikes-and-you're-out law alone is responsible for about half of that.
As we have discussed previously on this blog, the perennial and rapidly deepening budget crisis is very much relevant to the success of the HSR project. Prop 1A may have passed in November, but actual appropriation of the bonds is subject to the rules laid down in AB3034, which means they are part and parcel of the state budget fracas.
Housing would be in temporary guarded trailer parks set up close to work sites and enclosed by gates and fences. Thanks to heckuvajob Brownie, FEMA still has nearly 100,000 brand new trailers left over from hurricane Katrina, purchased at a cost of $3 billion. Their formaldehyde outgassing problem could be adequately addressed for the purposes of exceptional parole by simple modifications that ensure adequate ventilation at all times, even in winter. The number of participants in the program per trailer would depend on its size, but there would be no overcrowding. Outside of working hours, exceptional parolees would be confined to the fenced-in area, effectively a form of house arrest. This would be enforced with ankle collars with wireless electronics to track their whereabouts.
Exceptional parolees would remain entitled to health care, but the cost of providing it, housing, food, utility hookups etc. would all be garnished from wages. By law, the work must be both voluntary and compensated, otherwise it amounts to a form of slavery. In practical terms, however, participants in the program would receive very little cash.
Violations of house arrest, absenteeism, feigned illness, deliberate destruction of trailers or other property and, justified complaints from foremen - employed by commercial construction companies - would all be reasons to impose sanctions, up to and including a return to prison. On the other hand, those who persevere would gradually win parole privileges and eventually, their freedom. Meanwhile, they would acquire marketable skills in the construction industry.
Admittedly, the above is just a sketchy outline of how an "exceptional parole" program might work. Feel free to poke holes in the concept or, to make suggestions of your own, in the comments.
