City Council, April 15th - Celebrate the 100th Anniversary of the Gas Tax

Council meets on Monday for a work session on the prospects of new funding sources and closing the budget gap. One of the options on the table is a local gas tax, and there's no better way for Council to commemorate the nation's first gas tax than to enact a 100th anniversary gas tax!

The first gas tax was mostly uncontroversial
(February 28th, 1919)

A tacks/tax pun suggests a little bit of dissent, but it wasn't much
(February 22nd, 1919)

More seriously, we have this one process and conversation around "sustainable services" and the funding gap, but then we have this other process and conversation around greenhouse gases. Though they are using the same word "sustainable," they are in fact siloed and disconnected.

We need to bring them together.

Earlier this month the "Our Salem" Advisory Committee saw a preliminary report on greenhouse gas emissions.

57% percent of CO2 is from our transportation!
(April 3rd "Our Salem" Presentation)

The reason to raise the gas tax is not because it will help us fund new roads. We don't need new roads. We may need revenue for maintenance and for better bike lanes and sidewalks and bus stops, but not for new roads.

A big reason to raise the gas tax is because we need to reduce carbon pollution. We need to make it more expensive to drive a gas-powered car so that we start using them less. We need a better pricing signal on them.

Evidence that driving is too cheap

Today's LTE gives us clear evidence. Even if the letter is offered in jest, that it is at all plausible to think driving out of town to save 5 cents on a bag is a thrifty move is strong, strong evidence that we don't charge enough for road access and that driving is too cheap.

(See also City Observatory on "free" ice cream day. What we have are market failures, not problems in freedom.)

The recommendation is to put any new local gas tax to the vote. With sentiment around the SRC so polarized, it's easy to wonder if there would be broad enough support to pass it. Still, other communities have passed them. It will also be interesting to see if the "yellow vest" protests in France might be portable. I have seen some reactionary sentiment here locally that is beginning to draw on at least the symbolism of those protests, and there might be more to say about that. International trolls also appear to be using the movement to exacerbate tensions in local debates. So that's just something to watch. How contested will any new gas tax be?

The other two potential funding sources that Council is considering are an operating fee calculated per household and an employee-paid payroll tax.

In general, the search for new funding has not followed any kind of logic around taxing what we want less of. There's no linkage between policy goals and the new funding.

This is a structural problem for the whole "sustainable services revenue" project.