Fees, Fees, Fees replace the tax revenue that corporations and the rich used to pay meaning the American people are not going to be the ones visiting these places-----global tourism is what third world nations do for income.
I spoke a few days ago about the septic tank upgrades and legislation requiring water treatment in new housing developments. This attempts to end the small, low-cost housing developments especially in Republican districts along the Eastern Shore and Western mountains. Keep in mind this mirrors what is happening for the low-income city residents being pushed out with higher taxes, fees, and fines. This is why I keep saying----AN INJUSTICE FOR ONE WILL BECOME INJUSTICE FOR ALL.
IF YOU THINK ITS OK TO PUSH LOW-INCOME OUT OF BALTIMORE IT BECOMES OK TO PUSH LOW-INCOME FROM EASTERN AND WESTERN COUNTY DEVELOPMENT.
Below you see Congress is doing the same to low/middle income families by ending the subsidy for flood insurance and raising the premiums for this insurance. Remember Hurricane Sandy came and the working class communities along the coast were devastated-----the Eastern Shore felt that as well. While corporate subsidy was sent right away to augment the costs to corporations from this flooding-----the homeowners were left getting pennies on the dollar. Sounds like the pennies on the dollar of corporate fraud settlements doesn't it! It is the same---they are saying
WE THE PEOPLE DO NOT HAVE EQUAL PROTECTION OR RIGHTS AS CITIZENS AND IF WE ARE DAMAGED----YOU ARE ON YOUR OWN.
Environmental activists shouted decades ago against all of this development on flood plains but Congress and the Maryland Assembly allowed it because developers could earn profits. We subsidize the bank losses but homeowners are being deliberately pushed off their land with great losses of wealth by the ending of flood insurance subsidy. Remember, Trans Pacific Trade Pact does not allow public subsidy because it takes from global corporate profits and subsidy.
Maryland's pols were able to get some funds sent to the Eastern Shore this time but these folks are being told get out with your losses. EMINENT DOMAIN REQUIRES BUY-OUTS AT CURRENT MARKET VALUE. So, you see how the 'sustainable' development simply means moving the wealthy in and moving the working class out all over Maryland. Look below to see Congress delaying these policies until after the 2016 election primaries.
WHO IS BUILDING THE FLOOD WALLS AROUND HARBOR EAST AND HARBOR POINT WHEN WE KNOW IT WILL BE FLOODED? MARYLAND AND BALTIMORE TAXPAYERS.
FLOOD INSURANCE THAT ONLY THE AFFLUENT WILL BE ABLE TO AFFORD.
THE FEDERAL GOVERNMENT FEMA INSURANCE RAISES PRICES BUT DOES NOT END THE PROGRAM ALLOWING THE WEALTHY TO AFFORD REPLACING THEIR HOMES IN DISASTERS.
This fee involves exploding flood insurance premiums courtesy of FEMA---a Federal agency.
Flood Insurance Premium Hikes from New Maps Could Be Delayed Until 2015
By Andrew Taylor | February 10, 2014
Some flood insurance premiums required under a 2012 law now won’t be raised until the fall of 2015 at the earliest.
The Federal Emergency Management Agency (FEMA) said the $1 trillion bipartisan funding bill passed by Congress last month contains a provision that will put off higher premiums required by new flood maps. A provision in the spending bill blocks FEMA from using any funds to implement premium increases due to re-mapping, at least through the end of September when when the fiscal year ends.
However, it now appears that it will take FEMA another year or longer to get its re-mapping and rating program back on track after, and if, Congress unlocks the funding related to remapped properties in the next fiscal year.
The issue affects hundreds of thousands of homeowners who pay “grandfathered,” below-market rates for insurance because their homes were in compliance with earlier flood codes. Many of them were facing large increases over the five years due to new maps being drawn up.
The remapping and other changes being delayed were required under the Biggert-Waters Flood Insurance Reform Act of 2012, a bipartisan law intended to reform the money-losing National Flood Insurance Program. But the higher premiums required under the new law have spooked many homeowners living near coastlines or in flood plains, threatening them with, in some cases, multifold increase in their premiums.
FEMA was ordered to delay work on implementing new premium increases on grandfathered properties by a provision written by Rep. Bill Cassidy, R-La., and Sen. Mary Landrieu, D-La., and attached to last month’s omnibus spending bill. Cassidy is running to unseat Landrieu this fall.
Other flood insurance changes would still take place as planned, including higher premiums for frequently flooded properties and businesses and on second homes.
Also, people getting subsidized premiums still won’t be able to pass them on to people who purchase their homes.
The Senate has already passed broader legislation requiring delays of most premium increases on a sizable bipartisan vote, 67-32. House Speaker John Boehner, R-Ohio, has said that the House would address the issue this year but he and other Republican leaders in the House do not support the sweeping delays passed by the Senate. The White House has also raised concerns about the Senate’s broad delay, as well as about an insurance agent and broker licensing reform that is part of the Senate bill.
According to Rep. Steven Palazzo, (R-Miss.), one of the sponsors of original legislation in the House to delay the reforms and increases, a memo from FEMA acknowledges that the provision in the spending bill could set the agency back 12 to 18 months in addressing rates for grandfathered policies after the spending prohibition is lifted.
“In the initial delay language that was crafted in the House, we made sure to halt all FEMA activity to implement these drastic rate increases on some homeowners,” Palazzo said in a statement. “Because of that language, FEMA admitted today that our actions will have much further reaching impact on their ability to enact rate increases. This could buy homeowners as much time as two extra years as we continue to fight flawed and unfair FEMA practices and work to enact further reforms in both houses of Congress.”
The problem of dismantling social safety nets is not only the effect it has on the working and middle-class------it is that the subsidies are being continued for the affluent class with our tax revenue. Working/middle class pay almost all the taxes and this is why we had social safety nets with those taxes----THAT IS PROGRESSIVE. Clinton neo-liberals and Bush neo-cons say NO, your taxes will be used to subsidize corporations and the rich.
Remember how small that affluent class will be in a third world society-----
THE ADMINISTRATOR CLASS COMING RIGHT NOW AS GRADUATES FROM IVY LEAGUE UNIVERSITIES ALL PROMOTING THE POLITICS OF GLOBAL CORPORATIONS AND MARKETS.
This has been the case in Baltimore for a few decades but will get worse as current pols are replaced by globalists.
Below you see yet another fee growing higher and higher----this is your Medicare. Obama and Clinton neo-liberals installed the very Republican policy of Affordable Care Act with the single goal of killing Federal Medicare and Medicaid and they are doing it simply so health industry corporations can become global health systems that are purely profit-driven. THAT IS IT.
Bush created Medicare Advantage as the private insurance that would replace Federal Medicare and then Obama and Clinton neo-liberals gutted a trillion dollars from Medicare and Medicaid and changed the things Federal Medicare covered just to force people out of Federal Medicare because they cannot afford the co-pays and deductibles. Below you see how the Federal Medicare supplement Medigap is becoming so expensive people cannot afford it-----a friend of mind with perfect health habits and health history pays $300 a month for Federal Medigap. Meanwhile, private Medicare Advantage is low-balling premium costs to get people to abandon Federal Medicare and then they will simply allow premiums to soar.
THIS IS HOW YOU END FEDERAL MEDICARE THE BILL CLINTON AND GEORGE BUSH WALL STREET GLOBAL CORPORATE AND PROFIT WAY!
Baby boomers have already paid for all the medical care they will need-----corporate pols are pretending all that payroll tax to cover Medicare and Social Security doesn't exist----because it was looted from the US Treasury.
$300 a month in Medigap fees for senior health care you already paid for! Every time your national labor and justice organizations support a Clinton neo-liberal----they know these are the policies these Wall Street pols will install.
ALL OF MARYLAND POLS ARE BUSH NEO-CONS AND CLINTON NEO-LIBERALS---GET RID OF THEM.
Once again-------the working and middle class paid the bulk of payroll taxes into this Medicare fund and Obama and neo-liberals are designing these payments so that only the afflluent will be able to afford the Medigap that will give the kind of coverage everyone had.
What Does A Medicare Supplement Cost?
Compare Medicare Plans by PlanPrescriber.com
Get a No-Cost Medicare Health Plan Quote! Zip Code: Or call: (888) 310-0376 TTY 711 Mon-Fri 8AM-8PM EST | Sat 9AM-6PM EST Get Personalized Assistance From a Licensed eHealth Agent Explore Medicare supplement cost before writing supplemental coverage off as too expensive Too many people make decisions about their Medicare coverage based on misconceptions and second opinions from others. Some Medicare plans have been dismissed outright without doing the proper research.
If you are new to Medicare or are considering making a change during the Medicare Annual Enrollment Period don’t dismiss Medicare supplemental insurance because of second hand information or preconceived ideas about Medicare supplement cost.
Although there are several factors that determine Medicare supplement premiums this article will give a general idea about premiums for Medigap insurance policies (aka Medicare supplemental).
More important than that you will learn how to compare the cost of a Medicare supplement to the real cost of a Medicare Advantage plan and to original Medicare.
How much are Medigap premiums? Medicare supplement premiums can vary widely and there are several factors that can effect your premium including:
- Your age when the policy becomes effective
- Where you live
- Your gender
- Whether or not you use tobacco
- Your health condition in some cases
Medicare supplement Plan F is by far the most popular but does come with the highest premium as well.
Not all plans may be available where you live and Massachusetts, Minnesota and Wisconsin have their own standardized versions that differ from those listed above.
To give you a general point of reference Plan A (the least expensive) can be as low as $70-$90 per month for a female non-tobacco user at age 65. Conversely a male in his late age 80+ who uses tobacco may find the premium for Plan F (most comprehensive) to be well over $300 per month.
But when you compare out-of-pocket costs to original Medicare and to Medicare Advantage plans you start to get the whole story.
Comparing the potential costs of original Medicare and Medicare Advantage plans to a Medigap policy A Medigap policy will generally, to one degree to another, pick up your hospital deductible and the 20% out-patient expense that is associated with original Medicare.
The Part A (hospital) deductible is $1156. That can be amortized over 12 months to equal $96.33 per month. Medicare deductibles and premiums will probably continue to increase each year. You are still responsible for 20% of all out-patient costs. How much is 20% of an emergency room visit or a CAT scan or two? Hundreds? Thousands? Medicare supplement Plan F for example would have paid all your costs.
Medicare Advantage plan
Some Medicare Advantage plans have $0 monthly premiums and some have premiums over $100. One plan with a $0 monthly premium is AARP MedicareComplete. If you have a premium, after it is paid you are still responsible for cost-sharing amounts for services in the form of co-payments, coinsurance and deductibles.
That inexpensive Medicare Advantage plan could actually cost you more that a Medicare supplement policy. Although to be fair you should add the cost of a Part D plan to your Medigap premium since Medigap does not offer Medicare drug coverage. But still… you do the math.
Another cost associated with a Medicare Advantage plan may not be apparently financial at all. That is your possible lack of freedom to use any provider that accepts Medicare assignment. Believe me if you are enrolled in a HMO and develop a condition that requires a specialist or a hospital specializing in the treatment of that condition and you can’t use there services, you will consider that a cost of having an Advantage plan.
Bottom line on Medicare supplement cost Everyone’s needs and budgets are different. Medicare supplement premiums vary widely. While you have the opportunity check into Medicare supplement plans to determine if they are a viable alternative to either Medicare only or a Medicare Advantage plan.
If after exploring your Medicare plan options you find that a supplemental policy is out of reach, at least you have the peace of mind that you took the time to explore all options.
For more information read the government publication, “Choosing a Medigap Policy: A Guide to Health Insurance for People with Medicare“.
Back in the progressive labor and justice Democratic Party days-----I was able as a youth to travel all over the US and Europe for next to nothing-----airline fare could be found discounted and youth hostels were available all over the country. National Parks were free and well maintained.
I remember moving back to the Chesapeake Bay area to find Assateague National Park with park fees. Well, those fees are getting larger-----the airline tickets are prohibitive with fees and discontinued flight paths-----and US hostel system is being dismantled. If youth cannot afford to pay full price for traveling experience----they do not need traveling experience say Clinton Wall Street global corporate neo-liberals!
We all know the national debt is totally corporate fraud so all these austerity cuts are done because neo-liberals are working for global corporations and profit----not because they have to cut. What Obama and neo-liberals are doing with Trans Pacific Trade Pact is opening all of America's national parks to the worst of raw resource exportation/exploitation just as third world nations do.
Republican voters who think it is fine to allow raw natural resources to become global corporate profits for the JOBS JOBS JOBS had better consider that global corporations use slave labor in their mining and timber harvesting and Trans Pacific Trade Pact allows global corporations to operate in the US as they do overseas.
THIS IS NOT GOOD FOR AMERICA----IT IS NOT ABOUT JOBS, JOBS, JOBS. GET RID OF THESE GLOBAL CORPORATE POLS---ALL MARYLAND POLS ARE GLOBAL CORPORATE POLS!
HERE ARE MORE FEES FOR WHAT WAS ALWAYS SUPPORTED WITH THE TAXES WE PAID.
Redwood National Park Hostel to close its doors on January 18
... norcalhostels.org/news/redwood-national-park-hostel-close...It is with great sadness that we announce that the Redwood National Park Hostel must close its doors indefinitely on January 18, 2010, due to a lack of available ...
Visiting national parks could cost moreKatia Hetter, CNN
Updated 10:03 AM ET, Thu October 23, 2014
(CNN)Want to visit Yosemite, Grand Canyon or Yellowstone next year?
Pack your camping supplies and knock those parks off your bucket list now, because it may cost you a little bit more to explore the national parks by summer 2015.
For the first time in eight years, the National Park Service sites that charge entrance and amenity fees can increase their rates by set amounts. They have to engage their communities, note what the increases will cover and get approval by park service headquarters. Fee increase proposals are due by March 15.
Though just 133 of the 401 National Park Service sites across the United States charge an entrance fee, they're some of the parks that travelers often think of first.
Yosemite National Park, which released its fee proposal on Tuesday, wants to increase its weekly entrance pass from $20 to $30. Camping fees would rise from the current range of $5 to $20 per night for family sites ($40 per night for group sites) to a range of $6 to $24 per night for family sites ($48 per night for group sites).
The cost of national park passes will remain at $80 for the regular annual pass, $10 for the lifetime senior pass and free for the annual military passes and access passes (for those with permanent disabilities).
These are five national park sites we think you must see, either now or after any fee increases take effect. They're still a bargain!
Yosemite National Park, California
President Abraham Lincoln first protected Yosemite with his signing of the Yosemite Land Grant on June 30, 1864, 150 years ago. Yosemite will celebrate 125 years as a national park in 2015.
Grand Canyon National Park, Arizona
The Colorado River cuts through the bottom of the magnificent Grand Canyon for 277 miles, and it's a full vertical mile from the South Rim to the canyon floor. The canyon's width varies, but it measures 18 miles in several spots. The South Rim is open year-round, but the North Rim -- generally the coolest place in the park -- is open during the spring and summer.
Current vehicle entrance fee: $25
Yellowstone National Park, Wyoming, Montana and Idaho
Old Faithful calls this place home.
Established as the United States' first national park in 1872, Yellowstone is also one of the first 12 sites on UNESCO's World Heritage List, which recognizes the world's most important natural and cultural wonders. Yellowstone is one of the few remaining intact ecosystems of significant size in the northern temperate zone on Earth, including a volcano, more than 300 geysers and more than 10,000 thermal features.
Current vehicle entrance fee: $25
Arches National Park, Utah
Arches National Park is one of the most unique spots on Earth, home to the world's highest collection of natural sandstone arches. They include the largest, Landscape Arch, and the tallest, Double Arch South.
Current vehicle entrance fee: $10
Great Smoky Mountains National Park, North Carolina and Tennessee
It's free! Despite its reign as the most-visited national park in the country last year, with 9.4 million visitors, Great Smoky Mountains National Park is our bargain park, with no entrance fees. (There are camping and other amenity fees.)
That's because the park's Newfound Gap Road was once owned by the state of Tennessee. When the state transferred it to the federal government, the state required that no fee "ever be imposed" to travel the road.
An article in Baltimore Sun made note of the availability of transit subsidy to corporations to give to their workers in Baltimore just as the MTA moves towards privatization and public transit subsidy becomes at risk. This will be how the poor is excluded from public transportation altogether and the kinds of private employers offering this transit subsidy will be limited.
Below you see that Government employees are seeing their transportation and parking subsidies falling as the subsidy to private corporations grows. What happens as government workers salaries are cut and cut, benefits slashed, and the cost of traveling to work becomes too costly? Well, government jobs will be opened to immigrant labor who will already be used to these conditions. Did you know that Libya and Bahrain have most of its Administrative Class as immigrants brought just for their loyalty to the wages they are paid-----
HOW THIRD WORLD THIS FILLING OF GOVERNMENT POSITIONS WILL BE. REMEMBER, OBAMA JUST LIFTED THE REQUIREMENT THAT MEMBERS OF THE MILITARY OVERSEAS NEED TO BE AMERICAN CITIZENS.
The Baltimore Sun article noted that for all the corporate subsidy given to corporations to give to their workers----not many bites from workers as Baltimore's public transit is the worst in the nation because it has been so defunded and transportation funds are misappropriated.
Subsidized public transit is a great equalizer that when taken away will be yet another fee as public transportation from buses to rail is privatized----MARC train subsidy?
Posted at 04:08 PM ET, 03/14/2012
Senate backs return of higher transit subsidy
By Eric Yoder
The maximum tax-free subsidy that employers, including the federal government, can pay for their workers to use public transit in their commuting would nearly double to $240 a month under a provision in the transportation bill the Senate passed Wednesday.
Looking for cutbacks, agencies eye transit subsidy
Federal employees' public transit and parking benefits have begun to feel the pinch of the sequester.
- By FederalSoup Staff
- Mar 29, 2013
One agency, the Labor Department, has trimmed the maximum monthly transit subsidy in 2013 to $125. That's $120 less than the top amount agencies can provide under the law.
As a fringe benefit, the subsidy could be fair game as agencies look for savings to help them head off furloughs, the article notes.
Remember, when you have Clinton Wall Street neo-liberals in office they only think of how public money can be used to maximize corporate profit ----not how that public money can be used to better the public's life. So, they are all about privatizing our public transit system at all levels and creating the conditions of the public paying for all infrastructure and operations costs with transportation as they are now doing with our BGE public energy utility.
TRANSIT IS A PRIVATE BENEFIT THEY SAY.
The fees tied with bridge and road tolls paid to private corporations 'partnered' to these public structures says to the American people----you may have paid taxes for decades into the Federal and State transportation Fund but you are now going to subsidize the private corporations rebuilding and operating all of what was open roads and bridges----
The fees in Maryland for all of this is growing and will get worse. The idea below suggests a tiered payment with higher income paying more for public transit but we all know where these ideas end----
PLEASE DEMAND THAT PUBLIC TRANSPORTATION BE KEPT CHEAP AND ACCESSIBLE TO ALL!
The fees for public transit will grow and grow and become prohibitive for many. Public subsidy to the poor for public transit will end.
The Baltimore pols are the ones installing all of this public transit privatization as they work for Clinton neo-liberals like O'Malley. Republican voters had better watch out as you are made poorer and lose the ability to own cars! If you notice Obama and Clinton neo-liberals sent Federal money to expand transportation for universities only. In Baltimore we see our universities with all new buses that actually run on time. Below this tells you it is the CLUB approach to public transit and it is what creates student tuitions to rise----rather than have a strong public transportation system in Baltimore the students pay for their own internal buses with their higher tuitions.
All public transit leads to Johns Hopkins
Our fully funded public MTA worked fine when it was fully funded----please do not allow corporate pols to dismantle MTA
Please scan this long article to see what Clinton neo-liberals consider public transportation for private good.
Here's How The Government Should Be Subsidizing Public Transit
Read more: http://www.businessinsider.com/the-right-way-to-subsidize-public-transit-2013-4#ixzz3TcSKlQFv
This post originally appeared on Streets.mn.
In most of the United States and much of the world, public transport is publicly subsidized. Everyone in an area pays for transit whether or not they use it. This was not always the case, and need not everywhere be the case.
Once mass transportation was provided to the public for profit (in Minneapolis and St. Paul as well as most other US cities) from the late 1800s through the first half of the 1900s. While rights-of-way were often publicly provided, the companies operating transit paid for the maintenance of those rights-of-way above and beyond what was required for transit.
Subsidy should be considered two ways: capital subsidy and operating subsidy. These are related, but different enough that they should be considered separately.
Capital subsidy can be direct or indirect (such as assistance with land acquisition), and these monies come from federal, state, metropolitan, local and sub-local sources. Traditionally capital subsidy has largely come from federal and state sources, though recently local sources through sponsorship (see the Emirates Airways gondola in London, for instance) or value capture have been used.
Capital subsidy for transit expansion rarely, if ever, considers the effects capacity and network expansion have on operating subsidy, however. Since every transit system in the United States requires an operating subsidy, every service expansion increased the required operating subsidy and makes the financial position of transit agencies worse over the medium and long term.
Operating subsidies are from local, regional and state sources. The federal government placed severe limits on using federal money for operations in the 1970s, in part because most of the increases in subsidy went to total wages without any increase in productivity.
MARYLAND IS SUBSIDIZING BOTH CAPITAL AND OPERATING COSTS FOR VEOLA!
The Case For Subsidies
The primary reason for operating subsidy for US systems now seems to be “that’s the way we do it here,” which is not a proper justification. Many of the cities around the world—and in North America if we look to Canada, where the Toronto system is required to maintain 75% farebox recovery in order to receive provincial subsidy for the remaining costs—have much higher farebox recovery, fewer operating subsidies and much higher ridership, which suggests a justification for less subsidy and higher fares: planning without prices leads to bad planning.
Economics defines 4 types of goods: Public, Private, Congesting (or Common Pool Resource), and Club. Public goods are, by this definition, neither excludable (to use it, you must pay for it) nor rivalrous (the good is scarce and only one person can use it at a time). Yet public transport is both excludable (at the cost of validating payment), and rivalrous (when congested). Under those conditions it satisfies the definition of a private good. Many private goods are privately provided, hence the name.
However sometimes transit is operated non-excludably, for instance the Campus Connector at the University of Minnesota, or an elevator in your nearest multi-story building. Similarly, sometimes transit operates with an honor system payment with lax (or no) enforcement.
Often transit is not rivalrous, (non-rivalry implies my consumption does not affect yours, by increasing its cost or diminishing its quality) e.g. in off-peak times. The off-peak Campus Connector is a public good. It is paid for as a Club Good by the University of Minnesota and its students, since they are the primary beneficiaries (almost no one outside the U community would bother riding, so even it if is technically non-excludable, it is functionally excludable in that no one who isn’t going between campuses would bother riding, and the people going between campuses have something to do with the University).
The case for subsidy for some public goods is obvious. In the absence of excludability and rivalry, one needs to get revenue from somewhere to operate a service that provides public benefits. The classic example is national defense. I can’t just “not subscribe” to national defense, it protects me whether I want it or not. We can of course debate the amount of public good we want.
- Transit often operates on the left-hand side of the U-shaped cost curve. Fixed costs are spread over more and more users as the quantity demanded increases, while marginal costs remain small if not zero. If we charge riders e.g. an average cost for a service with near zero marginal cost (which is an approximation of the situation in transit in the absence of crowding, certainly in terms of the short run marginal cost, ignoring a few things like the delays which boarding imposes on other passengers), we get under-consumption and under-supply compared to the social optimum. That means if we charge more than the marginal cost of the ride, we get a less than socially optimal number of passengers (there is a deadweight loss). Somebody who would ride at a lower price that was still at least as high as their marginal cost cannot. The social benefit (consumer’s surplus) of that unmade trip is foregone. Unfortunately because of high fixed costs, this implies that fares at marginal cost will not recover total costs. Thus the natural monopoly / economies of scale or density / declining fixed cost is one aspect that might warrant subsidy.
- There are network externalities associated with public transit. The more users of transit there are on a system, the more useful the system is for everyone. This is sometimes called the Mohring Effect, but the basic idea is that if 50 people want a ride each hour, you send one bus. If 100 people want a ride each hour, you send two buses, each a half-hour apart, and the average rider only has to wait half as long, (reducing wait times, and over a network, reducing transfer times) Benefitting everyone. Similarly, the more riders, the more spatial coverage that can be provided (reducing access and egress times).
- Transit helps the transportation disadvantaged. Equity or welfare has often been an argument in favor of subsidy, that we do it to provide benefits for people unable to afford otherwise, or transportation for the disadvantaged. This gets more into values than economics, but there are some people who would be employed but for their ability to access jobs, so some subsidy on the transportation front is at least partially repaid by more economic productivity.
- Transit subsidy helps poor jurisdictions. This has also been argued at the macroscopic level, e.g. Yonah Freemark justifies the federal transit program by arguing in favor of spatial cross-subsidies, i.e. benefitting poor jurisdictions rather than poor people.
- Transit reduces congestion on other modes, by taking cars off the road, and therefore benefits drivers (who should thus pay for it).
- Transit stimulates economic development.
- Cars are subsidized, therefore transit should be subsidized.
These aspects argue in favor of subsidy. But then the question arises, subsidy from whom? That is, what is the appropriate base for providing subsidy? Here we argue in favor of a Club Goods model. People in the Club should help subsidize the service.
The beneficiaries of transit are relatively local. If I live in Minneapolis, the option of riding transit in Las Vegas or Curitiba is of essentially zero value to me. The option of riding transit within the greater Twin Cities region is of some value, and the option of riding transit in Minneapolis is of high value.
The option of riding transit that runs past my house to my desired destination is the highest value. Benefits diminish with distance from the system.
We can define the Club more narrowly as anyone who might want to use transit and is willing to pay (or whose employer or University is willing to pay or help pay) for a season pass. An advantage of using a season pass model (rather than pay per trip) is the ability that it presents in providing services without excessively under-pricing the transit service. Whoever wants to provide transportation benefits for the transportation disadvantaged can subsidize those whom they want without subsidizing everyone.
We can define the Club a bit more broadly as landowners whose property value is increased by the presence of transit. The option of riding transit sometimes is public good (i.e. the option is neither rivalrous nor excludable), and its value is embedded in locations near transit stations. This appears to justify some form of value capture approach (of which property tax is the most widely used, but certainly not the most direct or efficient mechanism).
Both of these clubs are smaller than the municipalities in which transit operates, and much smaller than higher levels of government, like county, state, or nation.
The Case Against Subsidies
Though there are clearly some arguments in favor, this post promised arguments against transit subsidy as well.
- Transit is basically a private good. Private goods can be privately provided, which aligns incentives of the producer with their revenue model directly, better performance is rewarded, worse performance is punished. When all transit lines—and road networks for that matter—are planned and operated below cost we simply don’t have any idea what the true value of any service is. If fares increase to cover costs or at least come closer to covering costs service can adapt to revealed demand and firms and households can adapt accordingly. Without proper prices we don’t know where to increase capacity or improve service. We can’t identify actual bottlenecks or spread peak demand across more hours in the day by using dynamic pricing. By planning service while blind to the value of the service everybody is a bit worse off and many actual transit riders are substantially worse off
3. Users should be financially incentivized to get season or annual passes (paid monthly with bank debits) and become “members” of the transit system rather than pay-as-you-go “riders”, which will encourage more usage, and many users to get subscriptions so they have the easy option of taking transit. As with many museums and zoos and other clubs, membership should be reciprocal, so joining the Twin Cities Transit System gets me “free rides” in Chicago or New York. This will increase the perceived ownership that passengers have for the service.
4. Land value capture should pay for capital costs of infrastructure. But we should only build new infrastructure which has a financial model for recouping operating and other ongoing costs. If the infrastructure generates benefits that accrues to landowners, it is both fair and efficient to use some of those benefits to pay for the infrastructure in the first place. For value capture (not just land value capture) as a tool for subsidy, it needs to be recurring rather than a one-time fee. The largest beneficiaries of transit services in the Twin Cities are downtown employers, the airport and the Mall of America. Downtown Minneapolis employers and employees receive a very large benefit because of reduced parking costs. If true, then a tax on downtown/airport/MOA wages (perhaps one-quarter of one percent) makes sense to subsidize additional service and frequency because of the Mohring effect, and these employers act essentially as a club. We still need a financial model for recapitalizing the system after the land is developed. Value capture is still appropriate, but it requires different mechanisms.
5. The public should subsidize transportation for the disadvantaged from non-transportation specific revenue sources. Perhaps the biggest problem with current subsidies is that they are place-based and not people- based. Why should the entire system be subsidized? Also, why should a professor pay the same fare as students? Or in New York, why should Mayor Bloomberg, the richest guy in the city, pay the same fare as the cleaning staff of Bloomberg, Inc.?