Eminent Domain Report

Today, I attended the IRWA Chapter 67 monthly lunch meeting.   The speaker was Philip Law, Corridors Program Manager for the Southern California Association of Governments (SCAG).  He came to discuss SCAG's 2008 Regional Transportation Plan.  The plan is intended to coordinate efforts to implement transportation improvements through Southern California.  It involves a $531.5 billion, 25-year long range plan of needed improvements.

The Plan's Executive Summary [PDF] describes in detail the various plan components, including:

• Maintenance and improvements to existing right of way;
• Substantial new right of way projects involving roads and mass transit (including high speed rail); and
• Efforts to improve the movement of goods, such as dedicated truck lanes and railway grade separation projects. 

Mr. Law also described some creative uses of technology that should be further explored, including a planned one-year pilot project for parts of the 10 and 110 freeways that will allow solo drivers to use the existing carpool (HOV) lanes by paying a toll.   The ExpressLanes project is scheduled to commence construction in 2010 and open in December 2010. 

Additionally, Mr. Law discussed the ever-decreasing role California's gas tax plays in funding infrastructure improvements, as inflation and construction costs far outpace increases in the gas tax.  Whether through new, creative funding sources such as the ExpressLanes project, an increase to the gas tax, or some combination of the two, raising $531.5 billion will be no small challenge.

I found the discussion regarding the gas tax particularly interesting.  California's state gas tax is fixed at $.18 per gallon (not counting the sales tax and any other local taxes).  That tax has risen only slightly since the early 1970's -- a pace well behind normal inflation, and even further behind rising construction costs. 

Moreover, as cars become more fuel efficient, drivers pay less in gas tax per mile driven then they would with older, less fuel efficient cars.  The end result:  the gas tax has an ever decreasing ability to fund needed transportation projects -- a problem that will only increase over time.  

One alternative to the various creative funding proposals would be to increase the gas tax commensurate with inflation (or gas prices, or construction costs, etc.)  Leaving aside the controversy raised whenever higher taxes are proposed and whether such a proposal would ever be adopted, this still would not account for revenue drops as fuel efficiency continues to increase. 

Looking at how other states have dealt with this issue, a chart of the gas tax for each of the states reveals that California's $.18 per gallon is nowhere near the highest in the country (Wisconsin apparently wins that award, at $.32.9 per gallon).   Whether raising that tax becomes part of the solution to funding California's transportation infrastructure remains to be seen.