Who Subsidizes Whom?

Todd Litman's picture

My recent column, Mythbusting: Exposing Half-Truths That Support Automobile Dependency, examined criticism by Christopher Cadwell of the Weekly Standard and Bob Poole of the Reason Foundation of bicycling improvement programs. Some of their arguments are silly, I doubt that even Weekly Standard readers believe that cyclists really demand a third of all road space or that cycling is simply a rich person’s hobby, but Poole presents his attack on the U.S. Bicycle Route System as thoughtful and rational, although as you'll see, his analysis is actually biased and selfish, reflecting outdated assumptions about the role of non-motorized transport in an efficient and equitable transportation system.

Poole’s criticism reflects the principle of horizontal equity, which implies that consumers should “get what they pay for and pay for what they get” unless a subsidy is specifically justified. He assumes that active travel (walking and cycling) are unimportant and unfairly subsidized by motorists. Let's see if Poole’s criticism is justified.

What Does Cycling Cost?

Various roadway cost allocation studies have estimated the costs imposed by different vehicle types. These studies indicate that heavier vehicles impose greater road wear, larger and faster vehicles require more road space, larger vehicles impose more accident risk on other road users, and motor vehicles impose pollution costs. Most cycling occurs on roadways and a portion occurs on special facilities which tend to be much cheaper to build than automobile facilities. For example, according to a recent U.S. Federal Highway Administration report, paved path typically cost about $500,000 per mile, unpaved paths cost about $120,000 per mile (a path is equivalent to two traffic lanes, one in each direction), and signed bike routes with significant roadway improvements (such as wider and smoother shoulders) cost about $250,000 per mile, compared with $2 million to more than $20 million per lane mile for interstate highway expansions. Described differently, a road system used just for walking and cycling could be much cheaper to build and maintain than one used for motor vehicle traffic. This suggests that active transport facility costs are an order of magnitude smaller than for motor vehicle travel. 

Although there are no official U.S. Bicycle Route System cost estimates, such routes usually consist mostly of secondary roadways with signs and improved shoulders, with separated paths where justified due to high demand (such as along a scenic corridor), low cost (reusing an abandoned rail right-of-way), or special need (such as crossing rivers and major highways, or other barriers to walking and cycling). As a result, a national bike route system should have relatively small costs compared with total highway expenditures.

Do Motorists Subsidize Cycling Facilities?

In 2011 (the latest data available) U.S. governments spent $206 billion on roads and motorists drove 2,946 billion miles, so roadway costs averaged about 7.0¢ per mile. During that same year motorists paid $127 billion in road user fees, which averages 4.3¢ per mile – the remaining 2.7¢ spent on roads is from general taxes. A typical motorist who drives 12,000 annual miles imposes $840 in roadway costs, pays $516 in roadway user fees and $224 in general taxes spent on roadways. Non-drivers tend to travel less, people who rely primarily on bicycling for transportation typically ride 3 to 6 miles per day or 1,000 to 2,000 annually. If their costs are an order of magnitude smaller than automobile travel (0.7¢ per mile), a typical cyclist imposes $7 to $14 in roadway costs, and pays $224 in general taxes toward roadways, a significant overpayment.   

Considering federal road programs in isolation, as Poole does, you could argue that it is unfair to spend vehicle taxes on cycling facilities. However, if you consider the roadway system as a whole, if you agree that motorists have a moral responsibility to mitigate the risks they impose on pedestrians and cyclists, or if you recognize that motorists can benefit from cycling improvements through reduced congestion and chauffeuring burdens, then you could reasonably conclude that it is fair and efficient to invest federal transportation funds on cycling programs.

Assume that cycling’s roadway costs average about 0.7¢ per mile and intercity cyclists average 50 daily miles, Poole’s criticism of the Bicycle Route System is based on bicyclists’ underpayment of roadway costs averaging approximately 35¢ per day. In contrast, a typical motorist who imposes 7¢ per mile costs, pays 4.3¢ per mile taxes, and drives 500 daily miles, underpays $13.50 per day. On the other hand, cyclists tend to spend far more than motorists per mile traveled at local stores, restaurants, campgrounds and hotels, and so contribute far more toward local property and sales taxes; to the degree that such taxes help pay for Bicycle Route System roads, cyclists probably paying more than their share of total roadway costs.  

Mode Share Allocation

Another approach for evaluating roadway spending fairness is to assume that funding should be allocated based on mode share. Since the U.S. spends $206 billion total on roads, and about 1% of total trips are currently by bicycle and 12% by walking, this would justify about $2 billion annual cycling investments, or $26 billion annual investments in active modes. MAP-21, the current U.S. federal transportation law, dedicates up to 10% of Surface Transportation Program funding to enhancements, which does approach active transportation’s 13% mode share, but these funds are spent on a wide range of programs including paths, scenic highways, landscaping, historic preservation, environmental and education programs, so cycling and pedestrian currently receive much less than their mode share.

Even greater investments can be justified for these reasons:

  • Investments should be based on potential rather than current mode shares. The FHWA’s Nonmotorized Transportation Pilot Program showed that walking and cycling mode shares increase significantly after facilities are improved, indicating latent demand (people want to walk and bicycle more than they currently do).
  • For the last half-century transportation agencies have underinvested in cycling facilities, and since current demographic and economic trends are increasing demand for non-motorized travel, additional investments are justified now to accommodate this growing demand.
  • Walking and cycling can provide additional benefits not recognized in conventional economic evaluation, including consumer savings, public fitness and health, and improved mobility options for non-drivers.

Is Motorized Travel More Important Than Active Travel?

To justify his bicycle program criticism Poole asks, “Why should I—either as a highway user-tax payer or a general taxpayer—have to pay for someone else’s hobby?” This assumes that active travel is less important than motorized travel. According to the 2002 American Long Distance Travel Survey, more than half (56%) of long-distance travel is for “pleasure.” Why is recreational cycling less important than recreational driving?

It is also inaccurate to assume that intercity cycling is entirely recreational. Cyclists sometimes ride 20-80 miles between cities for utilitarian trips such as business meetings, conferences and social events, which would otherwise require motorized travel.

Serving Diverse Travel Demands

This debate concerns much more than just the merits of the U.S. Bicycle Route System, it really concerns the value to society of creating a more diverse transportation system. Poole concluded that a national Bicycle Route Network is wasteful without even investigating its benefits and costs. This reflects the old planning paradigm which assumed that transportation means automobile travel and transportation system users consist only of motorists. Such planning is neither efficient nor fair. Automobile-dependent transportation systems force people to travel by automobile for trips that are more efficiently made by other modes, such as requiring parents to chauffeur youths to local destinations due to unsafe walking and cycling conditions, commuters to drive to work on congested urban corridors due to inadequate public transit services, and households to own more vehicles and spend more on transport than they can afford. An efficient and equitable transportation system allows users to choose the best mode for each trip, which minimizes costs and ensures that everybody – including non-drivers –  receive a fair share of public investments. It also helps reduce transportation problems; even people who never use alternative modes can benefit from improved transport options that reduce the traffic and parking congestion, accident risk, pollution emissions and chauffeuring burdens they face.

This is a timely issue. The twentieth century was the period of automobile ascendancy during which motor vehicle travel grew rapidly. During that period it made sense to invest significant resources into building roads and parking facilities. However, current demographic and economic trends (aging population, rising fuel prices, increasing urbanization, increasing health and environmental concerns, and changing consumer preferences) are causing travel demand to shift from automobiles to other modes; although few motorists want to give up driving altogether, at the margin (compared with their current travel patterns) many would prefer to drive less and rely more on walking, bicycling and public transport, provided that they are convenient and safe. It therefore makes sense to invest some of the resources that were previously dedicated to automobile improvements to support these other modes.

The practical challenge planners face is that most transportation resources – money and road space – are already committed to automobile facilities. As a result, pedestrian and cycling investments face a high burden of proof to demonstrate that they are cost effective – much more than automobile oriented investments. For example, there has never been an economic evaluation of minimum parking requirements in zoning codes, and transportation planning seldom applies least-cost analysis which would allow highway funds to be spent on alternative modes and demand management strategies whenever they are more cost effective overall, considering all benefits and costs.

This debate is also about learning to share. The road system is a unique and valuable resource that should be managed for the common good. Advocates of automobile dependency assume that pedestrians and cyclists are unimportant and have no right to use public roads. More equitable policy recognizes the legitimate travel demands of non-drivers and ensures that roadways safely accommodate all usersWhere motorized travel imposes significant barriers, risk, noise or air pollution on non-motorized modes, motorists have a responsibility to mitigate such problems through speed, risk and pollution reductions, or by helping to finance separated facilities.

Continuing This Dialogue

This is an important issue: there are several reasons to reform current planning practices to better support walking, cycling and public transit, but this will require changing the way we define transportation problems and evaluate solutions, and how we price and fund transportation facilities. Change is difficult, and many people, including many professionals, have inaccurate understanding of the benefits, costs and revenues of various modes. It is time to discuss the following questions:

Do pedestrians and cyclists have an equal right to use public roadways?

Should transportation agencies spend less to accommodate a non-motorized trips than a motorized trip that provides the same benefit (access to school, errands, recreation)?

If automobile travel imposes risks and delay (called the barrier effect) on non-motorized travel, do motorists have a responsibility to mitigate that impact, including helping finance separated sidewalks, paths and bridges where necessary?

Should transportation agencies spend at least as much on walking and cycling as their mode share? Should this be based on potential mode share (the mode share that would occur after the improvements are completed) to account for latent demand?

Should motor vehicle user fees increase to help finance a greater share of roadway costs?


After posting my previous column, Mythbusting: Exposing Half-Truths That Support Automobile Dependency, I invited Bob Poole to comment. He promised to respond in the next issue of his newsletter Surface Transportation Innovations. That will be helpful, but even better would be a response on this website so readers can watch the dialogue unfold. Are you willing, Bob?

I had a similar point-counter-point more than a decade ago with Peter Samuel in an article, Optimal Level of Automobile Dependency, published in Transportation Quarterly. I think that such exchanges are useful to raising our understanding of these issues.

Todd Litman is the executive director of the Victoria Transport Policy Institute.


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