Photo by DDOTDC on Flickr.
Mayor Gray released his proposed budget on Friday. It makes deep cuts in many areas, especially social services, but makes some exciting investments in transit funding, especially a big commitment to the streetcar program.
Besides a capital investment in streetcars, the budget maintains Circulator funding and gives WMATA a small increase, but not enough to stave off Metro service cuts. Off-street parking taxes raise general revenue and will also create incentives for employers to stop subsidizing parking.
Streetcars. The budget contains $99 million from now until 2017 to make a substantial start on the District’s streetcar system. DOT is also hoping to get some federal match and private sector funding from property owners and businesses who would benefit, to magnify the effect of this money.
Which lines will get built will depend on many factors, but DDOT’s transit head Scott Kubly said they are hoping to advance lines through Anacostia, over the 11th Street bridge and over to the Southwest Waterfront, and also to extend the H Street/Benning Road on both ends to Benning Road Metro in Ward 7 and K Street downtown.
Circulator. There’s $12 million in Circulator funding. Kubly believes that’s enough to extend the Union Station-Navy Yard line across the South Capitol Street bridge to Anacostia, Skyland and the Giant shopping center.
DDOT has already canceled the Mall route and plans to suspend the Convention Center-Waterfront one. It will also go ahead with plans to expand hours on Union Station-Navy Yard, reroute that line to pick up on Columbus Circle and take a more direct route along 2nd Street, add ADA features to the buses, and the other immediate steps in the plan.
Metro. There’s a $6.2 million more for WMATA, which the budget document claims is a 4.7% increase. That just happens to be exactly the same percentage as the Maryland draft budget.
WMATA had asked for a $32.6 million increase to avoid any service cuts. Had the DC budget included a bigger increase than Maryland’s, and given that Virginia counties are likely to offer more, it would put pressure on Maryland to do better. Instead, DC seems to be giving tacit agreement that 4.7% is what Metro will get.
Without more, Metro will be forced to increase rail headways and cut buses. While there may be a few bus cuts that make sense, this will surely go farther. We managed to avoid service cuts to transit for two tough years; it would be too bad to lose vital service that people of all incomes depend upon just as an economic recovery seems within reach.
However, I’m not sure this is actually a 4.7% increase. It seems that they only increased the local bus contribution by 4.7%, not the overall subsidy. A 4.7% increase across the board should be $11.6 million, not 6.2.
It’s a little bit tricky to tell in this budget. Gray’s budget staff have made a strong commitment to transparency in this budget, after being frustrated by some very opaque Fenty budgets. In transportation, however, two things are going on simultaneously that make it hard to follow.
First, they are moving a lot of money from one section to another, like transferring the WMATA subsidy into its own section, moving money between capital and operating, and more. Second, some budget areas are increasing and decreasing. As a result, there are large areas that go from zero to tens or hundreds of thousands of dollars, and others that move in reverse. That makes it difficult to follow which functions within DDOT will end up with more budget and more staff, and which with less.
Capital Bikeshare. The budget calls for accepting advertising on Capital Bikeshare stations, for total revenue of about $500,000 a year.
The money will go into the general fund. That’s helpful to close a big budget gap and avoid even deeper cuts to important social services. However, many had hoped the money could go toward expansion and making Capital Bikeshare self-sustaining.
There’s an argument that advertising revenue from city programs that can earn some revenue should also help contribute to other functions that can’t, like education, public safety or social programs. There’s also a strong argument for creating programs which can run like businesses, earn their own money and spend it to grow themselves and also add value for residents.
Off-street parking tax. The tax on parking garage spaces would rise from 12% to 18%. Most of this will actually come from parking operators’ profits rather than drivers, according to people familiar with the parking industry. That’s because the overall demand for parking governs the rates right now, rather than the costs of the garages and operations.
Nevertheless, Barbara Lang, head of the DC Chamber of Commerce and author of the atrocious transition report about getting commuters in and out of DC, hates the plan. She said that “people that are going to be impacted are people like me who provide parking for their employees.”
That sounds like an added benefit to this plan, not a drawback. Not only does DC raise some revenue but the organizations which are most distorting the transportation market get an incentive to stop. People who pay each day to park already are shelling out for parking. They know it’s not free. They are making an economic choice between driving and other modes, and some have few alternatives.
But when Lang or another employer provides free parking but doesn’t provide free SmartBenefits, the employee isn’t choosing between the cost of Metro and the cost of driving. They’re choosing between paying the cost of Metro themselves or having their employer pay for the parking. That’s a huge incentive to drive even if transit is a great alternative.
In addition to raising the parking tax, DC should also finally get around to closing the free-parking loophole with the “Clean Air Compliance Fee,” which would also charge a similar rate to employers who own their own garages and therefore don’t pay a parking company for spaces. Barbara Lang hates that, idea, too. That could be another sign that it’s another great public policy.
Other taxes. Another measure institutes “combined reporting,” which ensures multi-state businesses pay a share of their taxes to DC instead of sheltering it in other states. This is a sensible measure and somewhat overdue.
Finally, the budget contains a tax increase on incomes over $200,000. I’ve endorsed a tax on high income earners before. Several councilmembers, including Kwame Brown and Jack Evans, and several candidates for the at-large seat have already come out against the budget on those grounds. It’d be interesting to see if they can find an alternative to the $35 million this will raise.
Already, this budget does hit the poor fairly hard, including cuts to affordable housing and homeless services. Some of this could end up costing DC more in the long run, like homeless people who might end up in emergency rooms far more often as a result.
In upcoming articles, we’ll look at some other potential revenue sources and other elements of the budget.
This article originally said the Convention Center-Waterfront Circulator had already been canceled. DDOT is proposing to suspend it but has not yet done so.