California Commentary: How Will We Get Around After the Virus?

Written by Landlord Property Management Magazine on . Posted in Blog, Uncategorized

California Commentary: How Will We Get Around After the Virus?

By Jon Coupal, Howard Jarvis Taxpayers Association

The COVID-19 pandemic has upended our lives by putting our health at risk, disrupting our work lives and robbing us of most of our recreational activities. It has also evaporated all our assumptions about transportation policy in California.

First, in one of the few positive consequences of the pandemic, California’s highest-in-the-nation cost of gasoline is way down. In October of last year, the average per-gallon price of gas in California was $4.18. Today it is $2.72. Naturally, no one could have anticipated the crash in the oil market because of rapidly diminishing demand. The low price of gas would be a cause for celebration if it were not for the fact that most are having to shelter in place at home.

Second, while the price of gas is down, the excise tax is not. Thanks to the 2017 gas tax hike of 19 cents per gallon, California now has 58 cents per gallon of gas taxes, 76 cents when the federal excise tax is included. Gas tax proponents argue the funding is necessary for road projects, but with the sudden onset of double-digit unemployment, a cut in the gas tax would be welcome relief for those who need to drive every day.

Third, the coronavirus is likely to sharpen the debate over whether gas taxes are a reliable and stable source of revenue to begin with. One of the justifications for the gas tax hike in 2017 was the decline in revenues due to more fuel-efficient vehicles at the same time vehicle miles traveled were increasing. The coronavirus is likely to accelerate this trend as high-risk individuals travel less frequently and those who can, work from home. Will this increase the push for a vehicle-miles-traveled tax as a replacement tax for the excise tax? Implementation and privacy concerns suggest that shift will not be rapid assuming it happens at all.

Fourth, public transit will take a huge hit that will linger well after the virus is under control. Ridership across public transit systems in California has already been declining and the trend will likely continue in the mask-wearing socially distanced world of the future. No one knows what percentage of Californians will ever want to ride on public transportation again no matter how often the vehicles are cleaned or other mitigation measures are taken. In an era of tight local government budgets, transit systems which already require massive subsidies to operate might find themselves scaled back, restructured, or abandoned completely.

Fifth, it is not only that commuters will find alternative ways to get to work, but COVID-19 has already had an impact on where they will work. Urban planners might like density, but apparently plagues do, too. This is forcing many businesses and entire industries to fundamentally alter their workforces.

Sixth, environmental interests have noted that the sharply reduced traffic on our highways has lowered air pollution. If mass transit is no longer viable, does this mean air quality will return to pre-pandemic levels? Not necessarily. If transportation planners focused more on keeping traffic flowing rather than wasting precious dollars on failed systems, we could continue to see improved air quality. Coupled with ever-increasing efficiency and all-electric vehicles, we need not sacrifice clean air for the ability to own and use personal vehicles that provide maximum freedom and flexibility to California families.

Finally, speaking of failed systems, no discussion of California transportation policy would be complete with raising the embarrassing boondoggle known as high-speed rail. If our budget shortfall is as bad as Gov. Newsom claims it is, then now would be a good time to completely pull the plug on this costly program whose viability has been doubtful from the start.

Jon Coupal is President of the Howard Jarvis Taxpayers Association.  The opinions expressed in this article are those of its author and not necessarily those of the Apartment Association of Greater Los Angeles.  This article is being reprinted with permission from the Howard Jarvis Taxpayer Association and the author.

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