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Transportation

, Volume 35, Issue 6, pp 797–812 | Cite as

Just pricing: the distributional effects of congestion pricing and sales taxes

  • Lisa Schweitzer
  • Brian D. Taylor
Article

Abstract

Those who oppose tolls and other forms of road pricing argue that low-income, urban residents will suffer if they must pay to use congested freeways. This contention, however, fails to consider (1) how much low-income residents already pay for transportation in taxes and fees, or (2) how much residents would pay for highway infrastructure under an alternative revenue-generating scheme, such as a sales tax. This paper compares the cost burden of a value-priced road, State Route 91 (SR91) in Orange County, California with the cost burden under Orange County’s local option transportation sales tax, Measure M. We find that although the sales tax spreads the costs of transportation facilities across a large number of people inside and outside Orange County, it redistributes about $3 million (USD) in revenues from less affluent residents to those with higher incomes. The entire Measure M program redistributes an estimated $26 million from low-income residents to the more affluent. Low-income drivers as individuals save substantially if they do not have to pay tolls, but as a group low-income residents, on average, pay more out-of-pocket with sales taxes.

Keywords

Sales taxes Congestion pricing Equity Justice 

Notes

Acknowledgements

Many thanks to Randall Crane, Casey Dawkins, Ted Koebel, Chris Nelson, Kenneth Small, Max Stephenson, Gen Giuliano, Juliet Musso, Jianping Zhou, Martin Wachs, Sandi Rosenbloom, and three anonymous reviewers for their input into this manuscript. Excellent research support came from Eric Howard, John Linford, and Ryan Walker. This research was funded in part by a grant from the UCLA Academic Senate, and the authors are grateful for this support.

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Copyright information

© Springer Science+Business Media, LLC. 2008

Authors and Affiliations

  1. 1.School of Policy, Planning and DevelopmentUniversity of Southern CaliforniaLos AngelesUSA
  2. 2.Department of Urban PlanningUCLA Institute of Transportation StudiesLos AngelesUSA

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