There has been quite a lot of discussion recently about the “cost” of congestion, as well as pretty dire future projections in relation to levels of congestion 20-30 years in the future. But, compared to other elements of transport costs, how does congestion actually stack up? Todd Littman takes a look at this in a really comprehensive study that has been summarised on the Pricetags blog:
Comparing Congestion With Other Costs
The UMR report claims that traffic congestion wastes “massive” amounts of time and money, estimated at 5.5 billion hours and 2.9 billion gallons of fuel, worth an estimated $121 billion.
Described this way the costs seem very large, but measured per capita they appear more modest: 17 hours, 9 gallons and $388 per year, or less than three minutes, 0.03 gallons and $1.06 per day. These represent less than 2% of total travel time and fuel costs, which is small compared with other factors that affect per capita travel time and fuel consumption costs.
This indicates that congestion is overall a modest cost, larger than some but smaller than others:
Because congestion is just one of many costs, it is inappropriate to evaluate congestion reduction strategies in isolation: a congestion reduction strategy may provide far less total benefit if it increases other costs, and is worth far more if it reduces other costs or provides other benefits.
For example, roadway expansions may seem cost effective considering just congestion impacts, but not if wider roads induce additional vehicle travel which increases other external costs. Conversely, improving alternative modes may not be cost effective based only on their congestion reductions, but are cost effective overall when co-benefits (parking cost savings, traffic safety, or improved mobility for non-drivers, etc.) are also considered.
Somehow we need to get past using congestion as the primary success/failure measurement for transport. After all, not only is it seemingly relatively minor in the scheme of things, but there’s a fairly good argument out there that congestion doesn’t hold back economic productivity:Ultimately it’s hard to work out what the real cost of congestion is, but I’m pretty sure it’s WAY less than we assume.
Logic says that higher densities will lead to more congestion. Concentrating many more trips within a smaller area may be more efficient (less need for so many roads and a greater role for public transport, walking and cycling) and as more people catch the train or ride the bus along exclusive bus lanes, congestion becomes irrelevant to an increasing number of traveller, but typically we’ve often thought that even taking all that into account it’s inevitable that you’ll see more congestion as you increase densities.
A recent study by the Arizona Department of Transport, highlighted by Todd Littman in this excellent Planetizen piece, questions that assumption. The first part of the results – that people in higher density neighbourhoods drive less than those in lower density neighbourhoods, is not that surprising:
[The study] found that residents of higher-density neighborhoods in Phoenix, Arizona drive substantially less than otherwise similar residents located in lower-density, automobile-dependent suburban neighborhoods. For example, the average work trip was a little longer than seven miles for higher-density neighborhoods compared with almost 11 miles in more suburban neighborhoods, and the average shopping trip was less than three miles compared with over four miles in suburban areas. These differences result in urban dwellers driving about a third fewer daily miles than their suburban counterparts.
But where things get interesting is the follow on finding from the study:
However, the study made an important additional discovery. It found that roadways in more compact, mixed, multi-modal communities tend to be less congested. This results from the lower vehicle trip generation, particularly for local errands, more walking and public transit travel, and because the more connected street networks offer more route options so traffic is less concentrated on a few urban arterials. This contradicts our earlier assumptions.
Littman’s article argues that the key difference higher densities make relates to the availabilities of transport alternatives, which means that as congestion gets higher people are able to make different transport choices. In lower density areas such alternatives simply aren’t available so everyone has not choice but to continue suffering in congestion. Put higher densities together with other key elements of smart growth – like mixing land-use types, improving transport options and having a highly connected street network, and you have the ingredients for lower congestion than you’d think:
Not only does smart growth significantly reduce automobile trips, by offering better accessibility options it allows people to respond to congestion by shifting mode and route. For example, when congestion is a problem you walk or bike to local stores rather than driving to a more distant shopping center, some commuters shift to alternative modes, and motorists can shift to less congested routes for some trips. These solutions are not possible on newer suburban communities where destinations are dispersed; walking, cycling and public transport inferior; and hierarchical road networks channel all traffic onto major arterials.
This has important implications for transport and land use planning. It indicates that smart growth development policies have smaller costs and greater benefits than usually recognized, including local and regional traffic congestion reductions, but it also indicates that these benefits are contingent; they require an integrated set of policies including increased density, mix, connectivity and transport options. As a result, the best response to smart growth criticism is more smart growth, for example, more density and mix, additional pedestrian and public transit improvements, more connected transport networks, more parking management, and additional incentives to shift travel mode.
Critics often assume that smart growth consists only of increased development density. If that were true then some of their criticisms could have merit, but it is inaccurate, as discussed in a previous column, An Inaccurate Attack On Smart Growth. Smart growth involves a combination of increased development density and mix, more connected paths and roads, and improved transport options. Together, these land use reforms can provide a host of direct and indirect benefits.
All the more reason to contain Auckland’s urban sprawl I guess.
Seems like the best way to become a regular blogger on this site is to continually bombard the authors with Guest Posts – I’m excited about joining the team!
One of the fundamental geometric advantages of public transport is that it uses less space to shift a certain number of people, than your typical car does. This is most often talked about in terms of corridor space, with such metrics as “this railway line carries the equivalent of ten lanes of traffic” being commonly discussed. This is very true of course, but misses another element of the comparison – which is storage space. While rail and bus depots look fairly large, on a per person carried basis, they are a fraction of the space that gets dedicated to car storage – more commonly known as parking.
While these matters are generally quite logical, being able to quantify the space impact of different transport options is pretty useful when we’re looking at how to integrate our land-use aspirations with the transport projects we prioritise. A useful article by Todd Littman of the Victoria Transport Policy Institute helps by doing some of this work.
Newman and Kenworthy (1999, Table 3.9) found that automobile dependent cities average about 7 meters of road length per capita, while less automobile-dependent cities average about 2.5 meters, and parking supply follows a similar pattern. This indicates that automobile-oriented transportation increases facility land requirements 3 to 5 times. Put differently, 66% to 80% of the land devoted to roads and parking facilities in modern cities results from the greater space requirements of automobile transport.
In addition, motor vehicle traffic tends to reduce development density indirectly by increasing the need for sidewalk and building setbacks to avoid traffic noise and dust, so larger boulevards, highways shoulders and front lawns can be considered, in part, a land use cost of motor vehicle transport.
The key point here is to think about land as the obvious scarce resource it is – especially in our cities. If land is being used for wider and wider roads and larger and larger parking lots, that is land which cannot be used for buildings, parks and other – arguably more productive and desirable – uses. Littman goes on to detail this on a per capita basis:
An urban arterial traffic lane can typically accommodate about 1,000 peak-period vehicles. If the average urban automobile commuter drives 10 kilometers each way on a 3-meter wide lane, each requires 60 square meters of additional road space (3m width x 10,000m length x 2 daily commutes ÷ 1,000), plus two to four parking spaces (one at home, one at work, and a share at other destinations) that average 10 square meters for curb parking or 20 square meters for off-street parking. Each additional urban motorist therefore requires 80 to 140 square meters of land for additional road and parking space to avoid increasing traffic and parking congestion.
Compare this with other urban land uses. A typical urban resident uses about 100 square meters of land for a small-lot (400 sq. m.) single-family home with four residents, and less for multi-family housing (townhouses, condominiums and apartments). A typical employee needs about 10 square meters of office space or about 30 square meters for retail. This indicates that an automobile requires more land than a typical urban resident uses for housing, jobs and commercial activities. Automobiles more than double the amount of land required per capita.
That final sentence is critical, that automobiles double the amount of space required on a per capita basis. In other words, providing for cars halves the amount of space available for more productive activities.
What becomes particularly relevant is how this varies across different land uses – which is illustrated in the graph below:
You can really see this domination of commercial areas by roads and parking when you look at recently developed employment centres in suburban USA – with Tysons Corner near Washington DC probably being the most classic example: The ironic thing about having so much land dedicated to roads and parking in commercial centres like this is that this is most probably extremely valuable land. Obviously the zoning is fairly permissive for higher-intensity developments, obviously there’s already a number of businesses located here (the 12th largest employment centre in the USA), and it has good access to both downtown Washington DC and Dulles Airport. Yet so much of this precious land has been eaten up by roads and parking – because the auto-oriented model the places was developed around is just so extremely inefficient when it comes to utilising space.
(By the way, there are some pretty grand plans to completely change Tysons Corner over the next few decades, once the Silver Line Metro System is threaded through it).
What Littman’s work, as well as observations of areas like Tysons Corner, tells us is that if we want to be successful at utilising our urban space more efficiently, then we really need to think very hard about the contribution of transport to this goal, or how transport can undermine this goal if we continue to rely on a primary method of transportation that’s so extremely space inefficient. Furthermore, from an economic perspective if we are to utilise this huge amount of available land that’s often located in logical areas for growth and development, then we need to be providing an attractive alternative to the auto-centric planning paradigm we often get so stuck in. Quite simply, you can’t turn a Manukau or a Botany or a Westgate into the next Newmarket unless a massively lower proportion of people drive – there simply isn’t the space.
Todd Littman of the Victoria Transport Policy Institute has put together a really useful critical analysis of the way we measure congestion and how this affects the general approaches taken to reducing congestion – typically seen (especially when undertaking cost-benefit analyses of transport projects) as the main justification for transport expenditure. The article is a fairly easy read, if somewhat lengthy, so I won’t go through all the details. Here’s the abstract: To keep this post from getting too technical and detailed, I’ll largely focus on the pictures and graphs that are in the article. This is a particularly relevant graph, because it means that unless our transport demand modelling has been updated to take account of the pretty radical change to traffic volumes (this is the USA, but we’ve seen similar trends in New Zealand) in the past few years, chances are we’re going to be enormously over-estimating traffic volumes (and therefore congestion) in the future. There is a real danger of failure to see change, even after it has happened, by people who have spent their careers under one orthodoxy. And I believe that is what is happening now at the MoT, if the reports I hear are true, of officials there arguing that there is no point in changing policy just because of recent trends. Well how long do ‘recent trends’ have to continue before they become the relevant? 5 years? 10 years?: Some of the dip is obviously due to the economic situation over the past few years, but other aspects might be more structural – relating to demographic change, changing land-use patterns, significantly higher fuel costs and general cultural change. Littman’s article notes that, should this down-turn in traffic volumes prove to be long-lasting and structural, it really changes the way we approach the issue of congestion in the future:
It made sense to invest significant resources in roadway when the basic roadway system was first developed and automobile travel demand was growing rapidly. During that period highway projects provided high economic returns, consumers reaped large benefits, and there is little risk of overbuilding roadway capacity since it would eventually fill. But once the road system matures, so there are high-speed highways connecting regions and a well-developed network of paved local roads, the marginal benefits of incremental roadway expansion tend to decline.
Transport planning and financing practices will need to change in response to reduced growth in vehicle travel demand and congestion problems, and increasing demand for travel by alternative modes. This will require reducing emphasis on congestion problems and roadway expansion and increasing emphasis on other planning objectives and other types of transport system improvements.
Most of our long-term thinking is still based on the assumption that traffic rates will grow and grow. To an extent, in a place like Auckland where the population is growing quickly, that is likely to be somewhat true – but it seems reasonable to expect that per capita vehicle travel may well have peaked, meaning a slower rate of traffic growth in the future. This is a good thing, as it means we can hopefully get away from an endless game of adding capacity to the road system only to see it fill up over and over again, hoping that perhaps this one last time the extra lane might solve congestion for good (like a drug addict wanting just one last hit?).
Of course, in the real world (rather than the fantasy world of Ministry of Transport policy analysts and NZTA traffic engineers) we understand that building more roads simply leads to inducing more traffic – meaning that more often than not you find yourself back to square one rather surprisingly quickly (ever noticed that the widest sections of Auckland’s motorway network often also seem to be the most congested?). This is well illustrated in the diagram below: Now it’s probably a bit unfair to say that there’s no benefit from allowing more vehicles to travel at the time they want to travel (as induced demand provides for) even if it means the road is still congested. But what Littman’s research shows is that there are diminishing returns when it comes to the value added – in that a lot of the people “induced” to using the road at peak times wouldn’t probably be quite willing to travel at other times, or via other modes, to avoid the peak congestion. The article goes on in quite a lot of detail about how we might better focus on reducing the impact of congestion – through building public transport, pricing roads and undertaking smarter land-use policies. There’s enough detail in those to probably fill a future post, but there’s one last graph that certainly caught my attention, because it looks at the wide variety of different costs – related to travel – that individual people face: What this graph shows really cleverly is that, in the broader scheme of everything, traffic congestion doesn’t really cost each of us that much money. Sure, it’s an annoyance, but then so is losing $2,000 a year in depreciation on our vehicles, having a cost to society of almost $2,000 a year from crash damages, paying (through higher rent, prices or lower salaries) parking subsidies and so forth. Yet for some reason our transport policy seems to be utterly obsessed with minmising the cost to us of what’s really quite a minor matter – only the sixth most important issue in terms of cost magnitude.
So automatic, so deep is the group-think at the MoT and NZTA, not to mention their close buddies in the road lobbies like the Road Users Forum and the AA, that the only possible answer to all questions of movement is to expand the road space, that these institutions are spending uncritically on projects with ever decreasing returns on the investment. Of course the pressure from their political masters is currently very great too and it all adds up to a deeply unsophisticated and wasteful approach to infrastructure investment and a less efficient and poorer city.
Of course, for some road users (freight movement and business travel comes to mind) congestion and unreliability have a much greater impact. But there really is something incredibly stupid and naive about over building one system that forces everyone, no matter how reluctant, into a car and in the way of these vital road users. Under this ideology it’s almost like the MoT and NZTA are really in the congestion business. Where is the analysis that shows that getting lower value trips onto public transport through investment in providing quality services wouldn’t be more cost effective than trying to squeeze ever more traffic onto already clogged roads? Especially because, as this study shows, congestion isn’t even the biggest burden of auto-dependency.
In a comment on yesterday’s post about changing attitudes towards transport among young people, Stu Donovan pointed towards a very interesting piece of research undertaken by the Victoria Transport Policy Institute on changing transport trends in a number of different countries around the world. The argument of the paper is quite simple – and very much linked with what I’ve been pointing out has been happening in New Zealand recently – that the decades long trend of more and more automobile use seems to be tapering off and even declining in a number of developed world countries.
Here’s the paper’s abstract:
I’m not going to run through every detail of the paper, because it’s pretty lengthy, but rather pick out a number of the graphs and tables that I think are interesting.
Vehicle ownership rates seem to have hit a peak in the USA over the past decade, although the very high levels of car ownership seem to indicate that’s probably the result of market saturation: Perhaps a bit more interesting than car ownership rates is the fact that distance travelled per person has also tapered off over the last seven years compared to the rapid growth in earlier decades: It’s worth remembering that these numbers are per capita, so between 2000 and 2007 we would have still seen increases in total VMT, due to population growth. One does wonder why the last 10 years has varied so much from what happened in the 1990s though – perhaps the USA experienced more economic growth in the 1990s? Perhaps the very low oil prices of the 1990s, and the higher oil prices in recent years, have had an impact? Perhaps there are changing land-use patterns with a ‘re-centralisation’ of many cities.
The next graph doesn’t necessarily answer the questions above, but does show something quite interesting: that most of the slowdown in per capita VMT between 2000 and 2007 probably occurred in the last two years of that period, and that this trend has continued (and intensified) since 2007: There are some obvious similarities between the graph above, and what’s happened in New Zealand over the past few years – shown in the graph below: While one reason for the slowdown over the past few years might well be the economic situation, it’s interesting to see that in both NZ and the USA the large recession which occurred in the late 1980s and early 1990s doesn’t seem to have had the same impact on transport trends as what we’ve seen in the past few years.
The paper quotes Lester Brown, who suggests a potential social reason behind some of these changes:
There were probably quite a lot of teenagers in the late 1970s, due the baby boom of the post-World War II years, but even on a per capita basis the proportion of teenage drivers with licenses has declined in the USA in more recent times: Looking at the last 10 years, for most of these years the increase in public transport has been larger than that for vehicle use. The gap was particularly massive in 2008, when oil prices spiked: Of course there’s still some uncertainty over the question of whether what’s happened in the past few years is the exception to the long-running trend of increasing automobile use, or whether we really are at the cusp of a fundamental shift in transport trends. The more general ‘cultural shift’ of young people away from cars and towards other technologies is perhaps the most difficult thing to measure, but potentially very significant. I tend to think that rising oil prices have also had a fundamental impact on transport trends in the past few years, and it seems likely this will continue into the future too.
Todd Littman of the Victorian Transport Policy Institute has released a fascinating study into the health benefits of public transport. Here’s a brief summary of the study and its findings:
This report investigates ways that public transportation affects human health, and ways to incorporate these impacts into transport policy and planning decisions. This research indicates that public transit improvements and more transit oriented development can provide large but often overlooked health benefits. People who live or work in communities with high quality public transportation tend to drive significantly less and rely more on alternative modes (walking, cycling and public transit) than they would in more automobile-oriented areas. This reduces traffic crashes and pollution emissions, increases physical fitness and mental health, and provides access to medical care and healthy food.
These impacts are significant in magnitude compared with other planning objectives, but are often overlooked or undervalued in conventional transport planning. Various methods can be used to quantify and monetize (measure in monetary units) these health impacts. This analysis indicates that improving public transit can be one of the most cost effective ways to achieve public health objectives, and public health improvements are among the largest benefits provided by high quality public transit and transit-oriented development.
Considering the enormous amount of money spent on the health system in New Zealand (over $13 billion each year), looking at effective ways in which to improve health can potentially be extremely cost-effective. Add to that all the lost productivity from people dying earlier, or people being less healthy and productive and we’re talking seriously big numbers here.
Some of the connections between transport and health are obvious. The more we drive the more at risk we are of dying in a car accident. The converse to that is, because public transport is generally extremely safe, the more we use public transport per capita, the lower likelihood we will have of dying in traffic accidents. Statistics from US cities play out this correlation fairly well: There are also links between greater use of public transport, walking and cycling, and lower rates of obesity. This is once again reasonably obvious – as all public transport users are also pedestrians: while cycling is likely to keep you fit and therefore healthier in that sense:
Research also suggests that obesity rates tend to be inversely related to use of alternative modes (walking, cycling and public transit), as indicated in Figure 12. Rundle, et al. (2007) found that New York City residents’ Body Mass Index (BMI) ratings tend to decline significantly with greater subway and bus stop density, higher population density, and more mixed land use in their neighborhood.
Smart growth community design provides health benefits, particularly for children by encouraging physical activity (The American Academy of Paediatrics 2009). Residents of smart growth, multi-modal communities tend to walk more and have lower rates of obesity and hypertension than in sprawled areas (Ewing, et al. 2003). Frank, et al. (2010) found that residents of more neighborhoods with more and better transit service tend to walk significantly more and drive significantly less than residents of more automobile dependent neighborhoods. Research by Sturm (2005) found that, accounting for demographic factors such as age, race/ethnicity, education and income, the frequency of self-reported chronic medical conditions such as asthma, diabetes, hypertension and cancer increased with sprawl (Sturm 2005). Overall, 1,260 chronic medical conditions are reported per 1,000 residents; each 50-point change toward less sprawled location is associated with 96 fewer conditions. For example, shifting from automobile-oriented San Bernardino, California to transit-oriented Boston, Massachusetts would reduce 200 chronic medical conditions per 1,000 residents, a 16% reduction.
Another interesting link between public transport and better walking or cycling conditions is that a good public transport system makes it possible to remove many cars from city street, narrow down roads of pedstrianise them completely: which has huge benefits for walking and cycling. But critically, at the same time the good quality public transport will enable the city to keep functioning. It allows the best of both worlds.
I seriously do see the day when the Ministry of Health funds cycleways.
A lot of the writing about parking policies is quite complicated, and in some respects counter-intuitive. So it’s good when you can get the impact of our current parking policies simplified into something that’s quite easy to digest and understand. This 12 page document entitled “How free is your parking?” outlines many of the problems caused by the idea that land-uses should have to provide for parking that they generate: particularly in terms of the economic and transport impact this has.
Interestingly, if you look at residential typologies (different types of housing that you could provide) the need to provide parking (usually two spaces per unit, plus visitor parking) has been shown to frequently make it uneconomic to develop above three levels, unless you jump to nine-levels of more. This is because anything over three-levels of development will usually require underground parking – and that’s so expensive (because of the minimum parking requirements) that developers can’t recoup the costs until they’re building around nine-level or more apartment blocks. So much of that 4-5 level “European” style density that we hope to achieve in our town centres is made extremely uneconomic (and therefore won’t happen) largely because of parking controls.
Obviously, many shops and so forth would continue to provide off-street parking if you took away these controls. However, at least they’d have the choice to put the land to a more economic use if they thought that made more economic sense. Forcing a less economic use, through parking controls, is an enormous burden on developers that makes it much more difficult to achieve the intensification that our land-use planning strategies are trying to encourage.
The transport effects are also very significant: That 12 cents a kilometre value of parking is quite incredible. If we take that to be around $NZ0.17, and then consider that a typical car might get 10km per litre of petrol, that’s a doubling of the price of petrol (around $1.70 a litre up to $3.40 a litre) to truly take into account the value of parking that is provided “free” to car-users. The $0.12 a kilometre comes from research undertaken by Todd Litman, and can be accessed here.
I think there are the beginnings of a change in attitude towards parking regulations here in New Zealand. In a number of recent District Plan Changes, such as those relating to Wynyard Quarter and Sylvia Park, it is clear that there is at least a basic understanding that the more parking you provide, the more cars you will encourage to the area. While of course this is only part of the reason to remove minimum parking requirements, and in some cases impose maximum controls, it is certainly a step in the right direction. It seems obvious to me that if Auckland City Council is, for example, worried about the traffic impacts that an expanded Sylvia Park might have on surrounding roads, the best way to control that is to limit the number of additional parking spaces provided. After all, that is what will limit the number of vehicles accessing the site – if people start to realise that the carpark is always full on Saturday afternoons then they’ll either come at another time or they’ll catch the bus or train. All of which are good outcomes for the surrounding road network.
However, there are a lot of transport engineers, and planners for that matter, who are very much wedded to the idea of minimum parking requirements and think that the world will descend into chaos without them. So it’ll take some time to convince everyone of the need to change parking regulations.
Too often public transport advocates lose arguments about transport policy on economic matters. The environmental benefits of well-used public transport are fairly well accepted, and the social benefits can be argued – but often it’s on economic matters where we lose out. All it takes is for a politician to go “but look at all those subsidies” and you often find PT advocates floundering, or resorting to accurate, but rather hard to understand claims about hidden subsidies relating to parking provision, CO2 emissions and the like. That’s not to disparage the hidden subsidies matter, as it is extremely important to understand and recognise when looking at how sensible transport policies are or are not, but rather to say that actually, fundamentally, public transport makes economic sense.
Transport academic Todd Litman, who is the executive director of the excellent Victoria Transport Institute, has put together a very interesting research paper called Raise My Taxes, Please! Evaluating Household Savings From High Quality Public Transit Service. The basic argument of the paper is that public transport subsidies are well worth it, because each person who doesn’t have to drive as often saves an enormous amount of money for them. Here’s the abstract: The argument is fairly easy to make sense out of. Each person driving around in a single vehicle takes up a lot of road space (both to drive the car and to park it) and uses a lot of energy and resources to drive themselves around (both in terms of getting the car in the first place and shifting it around all the time). Road and parking space is expensive, as is owning and running a car. So having an auto-dependent city is very expensive, just generally the costs are borne individually (cost of owning a car) or hidden (parking costs).
Litman focuses on the term “high quality public transit” as being something of such a quality that people will actually choose it over and above driving for logical reasons. As I talked about a few days ago, most people don’t choose to use public transport because it’s not the mode of transport which works best for them – not because of some great cultural aversion. So what is necessary to get people to change modes from driving to using public transport is getting that public transport to a sufficient quality that makes it better than driving. This is certainly possible – evident in Auckland probably most obviously with the Northern Express service. Here’s what Litman says is necessary to constitute “high quality public transit”: Cities are classified by Litman into those that have “high quality public transit” and those that don’t. Perhaps one of the most interesting findings from Litman’s research is that even though cities with high-quality public transport certainly do spend more per capita on public transport subsidies, because of the higher patronage the system encourages, these cities have better “farebox recovery ratios’ than cities that only offer a ‘basic’ service. Someone should tell NZTA the best way to raise farebox recovery ratios appears to be by improving public transport services and making the system more attractive. Oh, and also point out to them that the farebox recovery ratios in New Zealand (Auckland’s around 45%) are actually pretty damn high by international standards. While the subsidies per capita in High Quality Transit cities are around two and a half times greater than those with basic transit only, fares (and therefore one would assume patronage) increase six-fold.
So Litman asks the question of whether that extra money spent on subsidies, to go from “basic transit” to “high quality transit” is worth it.
Is this expensive? Are such investments justified? Such funding represents a major increase in transit spending but is small compared with total transportation expenditures. U.S. households currently spend about $3,500 annually per capita on vehicles and fuel. Urban households, businesses and governments spend an estimated $2,000 annually per capita for parking facilities (residential garages, parking lots and on-street parking). Governments spend about $600 annual per capita on roadway facilities and traffic services, of which about $300 is from user fees (special fuel taxes, vehicle registration fees and tolls). In addition, households also pay about $100 annually to subsidize public transit services and $50 in transit fares.
That all adds up to around $5,950 per person per year for transportation expenditure. So $120 is a pretty small percentage of that. Especially so if it can make a big difference to what people need to personally pay for transportation.
But does it make a difference? We’ve learned above that investing in higher quality public transit makes the systems have better farebox recovery ratios, but what are the benefits for the people living in these cities from spending that extra money? Litman answers this question in the analysis that leads to the graph below:As is explained, it seems that generally cities with higher quality public transit end up spending a lower portion of their household expenditure on transport than cities with medium or low quality transit. In other words, the extra money spent on subsidies necessary for high-quality public transport are more than paid back by the savings that people make on their own transportation spending. This is further detailed in the table below:
This is a very interesting table, in that basically it details that for every dollar spent on increasing public transport subsidies to create a “high quality transit” system, the people living in that city save $4 of transportation costs. So there is roughly a 4:1 payback on this investment.
But that’s just looking at things from an individualistic point of view. Litman’s research indicates that there also seem to be wider economic benefits of having high quality transit- clear in an alignment between the higher GDP per capita and better quality transit. This correlation is shown in the graph below, and is likely to be a at least somewhat related to the individual savings outlined in the table above: Litman concludes his analysis by saying the following, which I think sums the matter up nicely:
Providing high quality public transit service typically requires about $268 in annual subsidies and $108 in additional fares per capita, but reduces total transportation expenditures about 20%. For an average household this totals about $775 annually in additional public transit expenses, offset by $2,350 in vehicle, parking and roadway savings, providing $1,575 in overall net savings.
Transportation costs are seldom evaluated in this way. Conventional transport project economic evaluation compares transit investments with just roadway costs; vehicle and parking costs are generally ignored although a vehicle and parking space is required for each road trip. High quality public transport and transit oriented development provide other often undervalued benefits including congestion reduction, road and parking cost savings, improved safety, improved accessibility for non-drivers, increased affordability, energy conservation, emission reductions, economic development, more efficient land use, and improved public fitness and health. As a result, conventional analysis underestimates the full savings and benefits provided by public transit investments.
Improving public transit service quality is therefore a win-win solution: most people benefit overall, including those who currently rely on alternative modes, those who switch from driving to alternative modes in response, and those who continue to drive who enjoy reduced traffic and parking congestion, reduced accident risk, reduced need to chauffeur non-drivers, and various indirect savings and benefits…
…Transportation planning often asks, “How much should we spend on public transit?” but in many situations it is legitimate to ask, “How much should we save?” since high quality transit allows households to spend less overall, even taking into account additional taxes. When all impacts are considered, consumers have every reason to demand, Raise my taxes! to create high quality public transportation in their communities.
As you can see, there is a very rational economic argument for improving public transport. Investment in public transport makes good sense. Money spent on public transport subsidies is not money that goes down the toilet, but instead seems to pay itself back four times over in terms of transportation savings per capita. The key issues for these benefits to happen though, is that the public transport system created must be high quality. There’s no point having a million slow buses running empty all the time because everyone still chooses to drive. The money must go into creating a public transport system good enough to attract people away from driving – to reduce their auto-dependency.
Whether or not it’s possible to “build your way out of congestion” is a fundamental question that transport planners all around the world grapple with. On the one hand, we seem to have been building a lot of “transport stuff” over the past few hundred years yet our cities seem as congested as ever; while on the other hand it seems quite crazy to suggest that building transport projects is pointless as no matter what you build, you’ll never actually be able to make a difference to congestion. Perhaps a useful term to consider is that we have to “run fast to stand still”, and that transport infrastructure needs to be constructed to ensure that, at the very least, congestion doesn’t get worse. But that’s not how it’s sold to us. The transport projects that a lot of money is currently being sunk into are sold to the public for their ability to reduce congestion, and if the politician is being particularly optimistic, to eliminate it altogether.
For an example, let’s have a look at some of yesterday’s announcement about additional spending on road infrastructure in and around Christchurch:
Less congestion, shorter travelling times and improved road safety are three of the major benefits Canterbury motorists can expect from the biggest road construction programme in the region’s history…
…NZTA Board member Garry Moore said the construction programme was designed to improve and future-proof access to the Christchurch International Airport and Lyttelton, Port of Christchurch.
“Our goal is to make life easier for Cantabrians by delivering reliable, safe and efficient road access to the airport and the port for the people and businesses of the region. The future economic growth and prosperity of Canterbury, depends on people and goods reaching these destinations efficiently, safely and on time.”
Mr Moore said the construction programme would deliver a wide range of benefits including:
• More efficient movement of increasing freight volumes through the region
• Improved access to Christchurch’s CBD, airport, Lyttelton Port and other facilities such as hospitals
• Reduced congestion leading to more reliable journey times
• Improved road safety, with lane-separated state highways, and traffic diverted from local roads
• Substantial investment in the local construction industry flowing into the regional economy.
Now to be honest I don’t know much at all about these motorway projects in Christchurch, and they very much might be essential – I simply don’t know the details enough to make a judgement in that respect. However, what is clear is that we’re being sold some big promises here for the $600 million or so that will be spent on these roading projects over the next decade. Are they likely to be realistic promises? Can roading projects really actually reduce congestion and improve travel times in the longer term?
I suppose at first glance it seems logical that building more roads, or widening existing ones, would reduce congestion. The more or wider roads you have, the greater capacity the transport system has and therefore the greater number of cars that can travel through it without the system becoming ‘overloaded’ – ie. congested. I suspect that many people think of a transport system being similar to a stormwater system, in that there is a certain amount of cars (water) that needs to be provided with space to get from A to B, and if there’s not enough capacity for them to get there – then you’ll have congestion, which is bad.
Googling the term “build your way out of congestion” shows that there are a reasonable number of groups that vehemently believe that you can achieve this task (although they generally appear to be anti-transit pro-sprawl groups). NZTA and the current government certainly seem to believe that building your way out of congestion is possible – as shown in the press release above (as well as just about every other press release about motorways we’ve seen in the last year or so). But it is true? How does the argument that each project is going to “make things better” stack up against the reality that congestion seems to keep getting worse, or at best, simply stays the same?
The big “elephant in the room” that seems to be ignored here is the concept of “induced travel demand“. I have talked about induced demand before, but basically it can be summed up as “if you build it, they will come”. Because new and wider roads offer a ‘superior product’ compared to what was there before, they attract more people to use them at the times people find most convenient. So therefore all that increased capacity can end up disappearing pretty quickly as people change routes, make their trips at peak times instead of off-peak, switch from public transport to driving or just make a trip that they wouldn’t have bothered with before.
Todd Litman, of the Victorian Transport Policy Institute, has put together an excellent paper on induced demand and its planning implications that explains the phenomenon in excellent detail. Here’s the abstract from his paper on the topic: The introduction contains a bit more information on what induced/generated traffic is, and the economic theory that sits behind the concept: In a bit more “user friendly” language, here are a few examples of transport decisions that relate to induced/generated demand: Interestingly, research has shown that over many many decades average commute times have apparently stayed the same, at around 75 minutes per day in the USA, even as transport technologies have rapidly improved. Of course people have been able to travel much further in that alloted time, but there certainly doesn’t seem to be any reduction in the length of commutes. However, that statistic is useful in attacking the use of ‘time-savings benefits’ in the cost-benefit analysis of projects rather than arguing that you can’t build you way out of congestion. If one was able to travel 125km within the 75 minute commuter allotment, traffic would be travelling pretty quickly and in all likeliness there wouldn’t be significant congestion.
But what this natural equilibrium of both commuting time and level of congestion means is that it’s damn hard to actually reduce congestion through road-building, because when you make an improvement to a road by widening it, the ‘latent demand’ that wanted to use that road but was put off doing so by congestion, is set free – and much (if not all) of that additional demand is eaten up very quickly indeed. This is well illustrated in the diagram below: Bringing this back to Auckland, we can see on a few of our motorway routes that capacity has been reached. Taking the Harbour Bridge and the SH16 causeway as two examples (because both are involved in potentially hugely expensive project to increase their capacity, we can see that over the period of 2004-2008 the number of vehicles crossing the Harbour Bridge reduced from 161,900 to 153,324 per day, while the number of vehicles going along the SH16 causeway between Waterview and Patiki/Rosebank Road went from 90,815 to 87,262. Of course 2008 was a rather strange year for traffic volumes, as petrol prices of more than $2 a litre really did end up forcing people off the road. But even if we look at the more “normal” 2007 figures, there really was little or any growth in traffic numbers between 2004 and 2007 on these two routes. Which to me suggests that they are probably considered to be approaching ‘capacity’. Of course it would be really interesting to find out the peak hour flows and how they’ve changed over the years, but unfortunately NZTA does not publish that data.
The point of mentioning the Harbour Bridge and the SH16 Causeway is that if/when we do add additional capacity – in the form of widening SH16 and building another crossing of the harbour (in whatever shape or form it turns out to be) then it seems inevitable that we will “let go” a lot of this latent demand, a lot more people will end up driving at peak times, and before long the roads will probably be just as congested as they are now.
Getting back to Littman’s article, aside from the ‘broken promises’ of motorway projects that were supposed to reduce congestion, but turn out to do nothing of the sort, there are quite a number of “costs” associated with induced traffic, that often are ignored by the current cost-benefit analysis system: There is a lot of other good stuff in the paper, and I could probably quote the whole thing quite happily, so I do suggest having a good read of it. However, I shall jump to the conclusion – as it provides some excellent overall points: So can you “build your way out of congestion”? Thanks to induced demand, I would think the answer is probably no, unless you built a truly unbelievable amount of roading so that all the latent demand in the whole city could be accommodated, even at peak hour. And to be honest, that seems like a pretty tremendous waste of resources. While congestion is annoying, it’s also sending us a message that perhaps we shouldn’t be driving along this road at this time of the day in this vehicle.
Interestingly, induced demand also applies to public transport (a better service will encourage more users). However, unlike the situation with private vehicles, induced demand is actually generally a good thing for public transport as it means higher patronage, lower costs-per-user and lower subsidies being required. Another fundamental advantage I suppose.
Raising the question of “how are we going to fund the CBD Rail Tunnel?” got me thinking about whether there could be some other ways of raising more money for transport projects. In particular, ways in which the future Super City council could raise money to pay its share of the project (which I am guessing would be construction of the stations). One potentially useful way of raising funds for transport projects could be a Parking Tax/Levy like the one operated in Sydney.
Basically, the way it works is that in order to raise money for transportation projects while also discouraging people from driving to areas easily accessible by public transportation, the New South Wales government charges the owner of properties containing off-street parking a certain amount each year – like an additional rate I suppose. For Sydney’s scheme (there’s also one in Perth), this is detailed further below: Todd Littman, from the Victoria Transport Policy Institute, has done quite a bit of analysis of different types of parking levies, and how they can be made most effective. In the paragraph below, he outlines clearly what the benefits of applying a parking levy are likely to be: I think it makes a huge amount of sense to tax parking in this manner. If you think about it, in a place like the CBD a parking space is quite valuable – with spaces worth up to $50,000 in Auckland for example. So a developer might choose, instead of building apartments, offices and retail spaces, which add vibrancy and significant economic benefits to a CBD, to instead build a parking building. And then, once all this additional parking is available we end up with more people driving, more congestion in our city centres, more pollution and our investment in public transportation being undermined. The developer gets all the benefits of a profitable development, while the city is left to pick up the bill for all the adverse effects generated by encouraging all those vehicles into the city centre. It would seem logical to put in place a financial mechanism to counteract the current situation.
Interestingly, Littman’s analysis shows that ‘all Parking Levies are not created equal’. In particular, there’s a clear distinction to be made between taxing parking transactions, and taxing the parking spaces themselves. When parking transactions are taxed, that means that where you currently pay for parking, your cost might be lumped with an extra $5 as a tax. So instead of paying $13 a day for your earlybird parking, you end up paying $18. In theory this is supposed to discourage people from driving into the city, but the problem is that it has the effect of making workers more likely to demand free spaces from their employers – or in other words, making parking spaces a more valued commodity. Littman goes into this a bit further: So that’s probably not the path for us to go down. The last thing we really want to be encouraging is higher parking subsidies and more sprawl.
The other option, which is known as a “Per Space Levy”, is basically what Sydney does, as I outlined above. Rather than having only ‘priced parking’ taxed, we see all parking spaces (with some exceptions) being taxed. This discourages the provision of any type of parking within the area you designate (most likely the CBD). It might also make more ‘unpriced parking’ (such as that offered by employers to employees as part of their salary package) into ‘priced parking’, which would remove hidden subsidies for car drivers and result in greater efficiencies. Littman briefly describes how this scheme has been implemented in Sydney and Perth: The difference in Sydney’s prices between what Littman states and what the NSW website states (outlined earlier in this post) is because Sydney have recently dramatically increased their parking levies.
Overall, Littman has some suggestions about what would be “best practice” ways in which to implement a parking tax/levy: Now to me it would seem as though implementing a parking levy that can raise money to help pay for critical transportation improvements, helps reduce hidden subsidies that encourage people to drive (such as the provision of a parking space as part of one’s salary package), reduces the number of parking spaces in the city centre and therefore the number of cars that will drive to it and discourages situations where our prime waterfront real estate is getting turned into parking buildings must be a good thing. Of course I can see a couple of potential issues:
- Aucklanders seem to hate to pay for parking. A proposal by the city council to extend the paid hours of parking from 6pm to 10pm was met with massive resistance, and eventually had to be quietly dropped – even though its benefits were pretty obvious (to stop people who owned apartments from hogging all the parking spaces).
- It might hurt the CBD and encourage businesses to locate elsewhere.
I think that the key to overcoming these problems would be to closely link the parking levy with the introduction of a hugely significant improvement to public transportation – such as the CBD Rail Tunnel. I would think that the transport benefits to the CBD of that project would far outweigh the fact that companies will need to either pay a bit more to retain their off-street parking spaces, or get rid of them. And in terms of public acceptance, if people saw what an amazing piece of rail infrastructure they were getting, then I think they would come around to it pretty quickly.
Overall, I think the benefits of a levy outweigh the costs quite considerably. At the moment Auckland’s CBD suffers terribly from there being far too many cars trying to squeeze their way into it, out of it and through it. A levy that can discourage people from driving to the city, while also raising funds for critical projects like the CBD Rail Tunnel surely has to be a good thing.