Proposed Taxes Might Leave Valley Motorists Wondering

By Sue Doyle

A half-percent sales-tax boost. A vehicle per-mile fee. Pay-to- use toll lanes. A $1 daily Los Angeles County parking fee.

The new year is just weeks old but Los Angeles County officials already are weighing nearly a dozen potential options to help generate up to $60 billion for county transportation needs through 2030.

And most of the options to pay for transit improvements are targeting taxpayers and the 7.1 million registered vehicles in the county.

"They’re leaning on us," said Jack Kyser, chief economist at the Los Angeles County Economic Development Corp. "You don’t lean on people in a down economy."

But it’s not just the county that is struggling to find options to pay for expanding and improving an aging transit infrastructure: Federal, California and Los Angeles city officials also are eyeing options.

And transit officials and politicians say there are few options. The federal highway trust fund — the major government funding source for highway and mass-transit projects — is headed for a deficit within the next two years.

The fund is fueled by a federal tax on gasoline, and officials are considering a 40-cent boost in the tax to aid the trust fund.

And with California’s budget deficit at $14.5 billion, state leaders are turning to local taxpayers to help make up the difference with money that they say is needed to keep the transit system afloat.

"We have to do what we can do locally to deal with our transportation crisis," said Michael Turner, metro government relations manager. "If we’re going to make any progress, these are some things it looks like we might have to do."

Metro last month commissioned a survey on residents’ response to everything from establishing a county gasoline tax of 15cents a gallon to charging county motorists $4 each time they get on the freeway during rush hour.

Other options included charging fees to trucks using freeways during rush hour, and under consideration now is a half-percent sales tax for the November ballot.

If approved by two-thirds of voters, the tax could generate an extra $660 million annually for the transit agency.

With a one-cent sales tax already in place, the agency annually brings in $1.8 billion, about 67 percent of its $3 billion budget. But officials say it falls far short of the county’s needs.

Los Angeles County’s population is expected to grow from 10.5 million to 13 million by 2050. And by that time, the number of California residents is projected to soar from 37.7 million to 60 million, according to the state Department of Finance.

Amid the growing demands, Metro officials are also working with Assemblyman Mike Feuer, D-West Hollywood, on a proposal for a carbon fee on Los Angeles County vehicles.

Saying the fee would help reduce greenhouse gases, Turner said the proposal is still shaping up and it’s unclear whether it would show up at the gas pump or with vehicle registration.

"The authorization for us to do this would still have to be submitted to the voters for approval," said Turner.

Same to the north

The Los Angeles County squeeze is not new to Bay Area residents, where voters are facing a similar measure called a climate-impact fee on vehicles to reduce carbon emissions and traffic congestion.

If approved by voters, the gas-tax measure would be phased in at 2.5cents a year for four years — ultimately adding up to 10cents more per gallon, said Stuart Cohen, executive director of the Transportation and Land Use Coalition, an Oakland-based group of 90 agencies from the Sierra Club to Save the Bay.

Working with lawmakers to put the issue on the ballot, Cohen said the fee would generate about $320 million annually and would be used to fund bus and rail improvements as well as bicycle and pedestrian safety.

Cohen said it would also encourage less driving and promote physical activity.

"We could save money by not having to constantly expand our road structure," said Cohen. "By switching to a Prius, you don’t get any of those benefits."

But by leaving the decisions up to voters, politicians are also avoiding raising taxes — which is popular with voters, said Tracy Westen, chief executive at the Center for Governmental Studies, a Los-Angeles based nonpartisan nonprofit group.

"Elected officials are paralyzed by the fear that the public will turn against them if they adopt tax increases," said Westen.

"So they are ducking their normal responsibility and saying, ‘You, the voters, decide.’"

New economic climate

The measures being studied come two years after voters approved Proposition 1B, $19.9 billion in bonds to upgrade California freeways, repair local roads and reduce traffic congestion.

But with unemployment rising, housing prices sinking and stocks tumbling worldwide, the economic climate is vastly different than when voters approved the proposition just two years ago.

And still, with California Transportation Commission officials slowly doling out the bond money, taxpayers have not seen significant roadway improvements yet, said Kyser.

"You’re going to have to have real results before you will have people going along with this," said Kyser, who added that officials will have to create more public and private partnerships to help keep transportation moving.

In Los Angeles city, officials are expecting to receive $150 million from the bond in April to complete traffic-light synchronization, with work to begin up to six months afterward.

Los Angeles County was awarded $1.2 billion from the bond last February to expand freeways, including adding a 10-mile car-pool lane to the northbound San Diego Freeway through the Sepulveda Pass. Still, work has not yet begun on it.

Feuer said cities should not be stuck in gridlock while the state wrestles with a financial crisis, and he recently introduced a bill to lower the threshold of voter bond approval for local transportation projects from a two-thirds vote to a 55 percent vote.

"We cannot stand still in California," said Feuer. "We cannot consign ourselves to always being in gridlock."

Left to politicians

But some national issues — such as raising gasoline taxes — are in the hands of politicians. Last week, a 12-member commission formed by Congress recommended that federal gasoline taxes be raised 40cents a gallon over the next five years.

The funds would be used for transportation improvements and projects nationwide, which are forecast to cost $225 billion for the next 50 years.

The gasoline tax has not increased since 1993 and has not been adjusted to keep up with inflation.

Under the proposal by the National Surface Transportation Policy and Revenue Study Commission, the current tax of 18.4cents a gallon would be increased from 5cents to 8cents annually for five years and then indexed to inflation.

Other sources of revenue could come from tolls, peak-hour tolls on highways, freight fees and ticket taxes for passenger rail improvements, according to the commission report.

But the Bush administration has said raising taxes won’t reduce traffic congestion and instead just creates additional risks to allow congressional pet projects.

"We’ve got ourselves into quite a quandary," said Kyser. "It will take some strategic thinking to try and come up with the solutions."

But some politicians say the very solutions being considered — boosts in federal and state taxes for gas — are built on old ways of thinking.

"We’re trying to become energy independent, which means reducing our reliance on the very source of funding on which we rely to build subways and roads," Feuer said.

"We have to modernize our financing system."

sue.doyle(at)dailynews.com

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