Roads Should Pay for Themselves

Below, Mark reacts to an article where the author posits that since “roads don’t make money,” rapid transit should not be held to a profit model. Mark Says:

I constantly hear people using the argument that “roads don’t pay for themselves” when debating about whether or not a public $ investment should be made to develop some sort of mass transit program.

“……But please, let’s not hold this transit plan as something that needs to “make money” or “pay for itself.” When’s the last time a freeway made money?…..”

Bottom line is roads DO pay for themselves, in fact they pay for themselves many times over.  Imagine what would happen if we didn’t have roads, or if the road system we had 20 years ago was never improved or expanded.  Try to identify anything you own or consume that didn’t get to you by using our roads, try to think of any aspect of your daily life that would remain the same if we didn’t have roads.  Heck, even mass transit programs (all types) are reliant on our roadways.

Our roads may not have an easily identifiable revenue stream, but they are the backbone of our entire economy and lifestyle.  Could they be better planned, would we be better off with a more balanced mix of mass transit versus driving, would our lives improve if congestion was reduced, would our economy be stronger if the same level of “mobility” was available to everyone?  Probably.  Nobody is arguing we can’t do better, but trying to make a case that roads or transit programs should have a “net” cash flow in order to justify them is ridiculous.

Trying to put a price or assign a value to our Country’s mobility is like trying to determine what the value is of having the vast majority of our population being able to read (public education), or knowing that if my house catches on fire I can call for help (fire department), or if we’re attacked by some enemy we’ll have a way of protecting ourselves (military) and so on and so forth.

Whether we should invest a limited amount of available $’s into expanding our roadways or alternative transportation programs is a worthwhile debate, but neither option in and of itself is going to produce an identifiable net cash flow.

Back in the day, our first ‘interstates’ were turnpikes.  They got their name from a ‘turnpike,’ a bar-like device that blocked the road until you paid a toll that allowed you to travel to the next turnpike.  At first, there was a turnpike at the entrance to every piece of private property the road crossed.  Then entrepreneurs negotiated easements and removed a lot of the barriers and made travel much less complicated.  They used the money from the access fees to keep the roads in good condition, paid landowners for access to their property, and yes, made a profit.

Although we have some private toll roads today, most are built, run and maintained by the government, usually the county or state.  Most of these roads in fact do make money. So much so that private companies have bought or leased the roads (Chicago and Indiana) and expect to make a lot of money off them.

Our streets and highways are paid for by gasoline, heavy truck and automobile taxes.  It makes sense that the users pay for the streets they roll on. At the same time, the money collected must meet the needs of maintenance, repair, and infrastructure. It may not have to show a “profit” in the true sense of the word, but it must not show a loss.

That’s the problem most cities find themselves in today.  They have used the gasoline and road use taxes for other things and now the maintenance has fallen way behind. They have not been good stewards of the funds, and the boulder sized pot hole outside my driveway is the result.

If our government looked at ‘profit’ not as a dirty word but as what is left when the expenses are paid, and that rolling it over for uses in the same department is not a bad thing, there would be no budget deficits, realistic goals would be met, and we wouldn’t be in the financial mess we are in today.

JVH

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3 Responses to Roads Should Pay for Themselves

  1. Keith says:

    More efficient cars are reducing the gallons of gasoline sold, and the taxes on them. Add up the increasing costs for asphalt, equipment, labor, etc, and the result is a maintenance backlog nearly everywhere. Efficiencies have been realized, and still the backlog grows as demand exceeds supply.

    Most of the road damage is due to trucks. The literal impact of a truck on a roadway is many times that of the cars on the road around that truck. Trucks pay too, in weight mile and fuel taxes, but it still isn’t enough.

    So, agencies responsible prioritize to maintain critical streets. like arterials and fire/emergency response corriders, while they just cannot get to others.

  2. BW says:

    I read an article yesterday about a third world country learning to plant crops and raise livestock, but without an infrastructure of passable, maintained roads, they couldn’t make significant progress. I suspect they’ll have to start out with some sort of turnpike/toll system to fund their roads, since their government is no doubt too poor to fund it. We’re fortunate to live here.

  3. Same thing goes for transit. If DC didn’t have a subway system, it’d be like Newark or Camden probably, despite the presence of the federal government. And to provide the space for a couple hundred thousand people driving to work in the city, we’d have lost tens of thousands of housing units for freeways, and would need plenty of surface parking (seen any photos of Houston).

    Houston: http://beyonddc.com/log/wp-content/uploads/2009/10/downtownhouston.jpg

    The economic return from the transit system to DC (and Arlington County Virginia) has been incredible.

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