The question facing us now isn’t whether or not to increase funding for transportation but whether or not to reform—or even question—the very nature of our approach to transportation. An increase in the gas tax, additional sales taxes/fees or more deficit spending only allow us to continue to distort – for a few more years – a transportation system that is not financially viable. Without any price signals providing supply/demand feedback, we are destined to build ourselves into insolvency (again).

And a final word to you transit and bike/ped advocates who have been promised riches if you’ll get behind calls for more money for this system: you are fighting for scraps today with disingenuous partners when, if you simply walked over the next ridge, you would find more financial support than you ever dreamed. That ridge: localization.

We had the greatest transit and the greatest pedestrian facilities before we had centralized transportation policy. Bike/ped and (when not done by highway engineers) transit improvements are the highest returning transportation investments a city can make. Phase the federal and state governments out of this game and you open up enormous possibilities for bringing about the world you desire. Stick with this tired approach and you will continue to be an afterthought in a system that is going bankrupt.

Now the math…

There is one overriding assumption to my calculations that I know to be false, but here it is: I assume a static response to price increases. In other words, as the price goes up, I assume that people absorb the increase and continue to drive just as much. They will not.

There is a complex and dynamic feedback loop that occurs when energy prices increase that cannot be accurately modeled. The end result for my calculations is that I overestimate the amount of revenue to be gained from an indexing to inflation, GDP and traffic and I underestimate the amount of gas tax increase needed to meet our needs. Since the startling thing about this analysis is the gap between what a reasonable increase would produce and what is needed, guessing at a dynamic feedback loop would simply be running up the score. The gap is already too big to overcome; we need to start thinking differently.

Just know that, when you are looking at the chart, the inflation, GDP and traffic lines should be lower, and the need line much higher, than what is represented. I've attached my spreadsheet so you can mess with it yourself.

I began my analysis with our actual fuel tax receipts since 1994. These I obtained from the Federal Highway Administration.