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845VTPI Newsletter, Summer 2008

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  • Todd Alexander Litman
    Aug 5, 2008
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                                        VTPI NEWS
                            Victoria Transport Policy Institute
                               "Efficiency - Equity - Clarity"
                                Summer 2008    Vol. 11, No. 3
      The Victoria Transport Policy Institute is an independent research organization dedicated to developing innovative solutions to transportation problems. The VTPI website (http://www.vtpi.org ) has many resources addressing a wide range of transport planning and policy issues. VTPI also provides consulting services.

      "Carbon Taxes: Tax What You Burn, Not What You Earn" ( http://www.vtpi.org/carbontax.pdf )
      Carbon taxes are based on fossil fuel carbon content, and therefore tax carbon dioxide emissions. In July 2008 British Columbia introduced the first carbon tax in North America. This paper evaluates this tax. BC’s new tax reflects key carbon tax principles: it is broad, gradual, predictable, and structured to assist low-income people. It begins small and increases gradually, allowing consumers and businesses to respond with increased energy efficiency. Revenues are returned to residents and businesses in ways that protect the lowest income households. Like most new taxes, the carbon tax has been criticized, but much of this criticism is technically incorrect or exaggerated. Consumers have many possible ways to conserve energy and therefore reduce their tax burden. Since lower-income households tend to consume less than average amounts of fuel and receive targeted rebates, most low-income households will benefit overall. This tax supports economic development by encouraging energy conservation which keeps money circulating within the regional economy. British Columbia’s carbon tax shows true leadership. If other jurisdictions follow, its impacts and benefits will be huge.
      "Pay-As-You-Drive Insurance: Recommendations for Implementation" ( http://www.vtpi.org/payd_rec.pdf )
      This paper provides guidance for implementing Pay-As-You-Drive (PAYD) vehicle insurance. It describes PAYD pricing options, discusses PAYD benefits and costs, describes regulatory reforms, evaluates various objections to PAYD, and provides specific recommendations for PAYD implementation. It was prepared for a recent PAYD workshop by the California Department of Insurance.
      We recently updated our "Online TDM Encyclopedia" ( http://www.vtpi.org/tdm ), a comprehensive source of information about innovative management solutions to transport problems. We revised and expanded many chapters, and added these new ones:
      'Multi-Modal Level-Of-Service Indicators' ( http://www.vtpi.org/tdm/tdm129.htm ). Describes Level-of-Service (LOS) rating systems suitable for evaluating the quality of various transport modes from a user's perspective. This helps make transport planning more neutral and responsive, and is particularly important for TDM planning.
      'Public Bike Systems' ( http://www.vtpi.org/tdm/tdm126.htm ). Automated bicycle rental systems designed to provide efficient mobility for short, utilitarian urban trips.
      'Transit Station Improvements' ( http://www.vtpi.org/tdm/tdm127.htm ). Describes ways to improve public transit stop and station waiting conditions.
      'Developing Indicators For Comprehensive And Sustainable Transport Planning,' published in "Transportation Research Record 2017," Transportation Research Board (www.trb.org), 2007, pp. 10-15.
      'Valuing Transit Service Quality Improvements,' published in the "Journal of Public Transportation," Vol. 11, No. 2, Spring 2008, pp. 43-64; at www.nctr.usf.edu/jpt/pdf/JPT11-2Litman.pdf . A corrected version of Table 3 is available as Table 11 in the report "Valuing Transit Service Quality Improvements" ( http://www.vtpi.org/traveltime.pdf ).
      "Please Tax My Carbon" ( http://www.planetizen.com/node/33959 ), Planetizen Blog.
      "Cheap energy policies and resulting high rates of energy consumption now impose increasing economic, social and environmental harms. People who are energy rich are becoming poor in other ways: high energy consumption impoverishes consumers, transfers wealth from North America to foreign energy producers, and exacerbates problems such as traffic congestion and accidents, and creates environmental risks such as climate change. To avoid these problems, North America needs innovative solutions that increase the economy’s overall energy efficiency, that is, which extract more productivity and consumer welfare per joule of energy consumed. Such solutions do exist"
      Town Makers Discovery Tour of the Great Pacific Northwest, August 28 - 31, Seattle WA and Vancouver B.C. ( http://www.vtpi.org/temp/pbt2008.pdf ).
      This high intensity learning experience will be a showcase tour of the best new streets, blocks, parks, cottage housing, pocket neighborhoods, affordable housing, LEED neighborhoods, village housing, waterfronts and downtowns.
      "New Analysis: LEED Standards Need Reform To Reflect Environmental Costs Of Driving" ( http://switchboard.nrdc.org/blogs/kbenfield/new_analysis_leed_standards_ne.html ) by Kaid Benfield, Director of the Smart Growth Program, National Resources Defense Council. This Blog discusses the importance of incorporating transportation and parking management into LEED standards, based on our research ( http://www.vtpi.org/leed_rec.pdf ).
      'Bridge Expansion Plans Ignore Effects of Growth' ( http://www.oregonlive.com/news/oregonian/index.ssf?/base/news/1214029515244280.xml&coll=7 )
      Jul 04 2008 -- The Oregonian
      Plans to build a new bridge over the Columbia River in Portland ignored projections that said the newer, bigger bridge would contribute to outward expansion of development from the metropolitan core.
      "Connected Bus" ( http://www.cisco.com/web/about/ac79/ps/cud/tcb.html ) is an program by the Cisco Internet Business Solutions Group and San Francisco Municipal Transportation Agency (SFMTA) to use innovative technologies to improve the convenience, comfort and attractiveness of public transit bus services, including real time bus arrival information, interactive user information at stops and on vehicles, improved safety and security, and on-board WiFi service. The Victoria Transport Policy Institute is providing analysis support to the program.
      "Creating a Quality Transportation Experience," Keynote Speech, Yellowstone Business Partnership Annual Conference, May 2008, ( http://www.yellowstonebusiness.org/datafiles/YBP_Summer08_ProofE.pdf )
      The California Air Resources Board is accepting comments on their Draft AB 32 Scoping Plan ( http://www.arb.ca.gov/cc/scopingplan/scopingplan.htm ) at http://www.arb.ca.gov/cc/scopingplan/spcomment.htm .

      A recent Brookings Institution study, "The Impact of Pay-As-You-Drive Auto Insurance in California" ( www.brookings.edu/papers/2008/07_payd_california_bordoffnoel.aspx ) indicates that PAYD insurance pricing in California would provide large benefits:
      • An 8% reduction in light-duty vehicle travel.
      • Social benefits estimated to total $10.8 billion based on current driving levels, increasing to $21.1 billion in 2020.
      • State government savings totaling $54 million annually based on 2006 data, increasing to $60 million annually in 2020.
      • 7% to 9% of the total CO2 reductions needed to meet California’s emissions targets for 2020.
      • Nearly two-thirds (64%) of California households would have lower premiums under PAYD, with savings for that group averaging $276 per vehicle-year.
      • Particularly large benefits for low-income drivers. Every household income group making less than $47,500 (in 2001) saves on average. Even in higher income groups most households benefit overall.
      • For every ethnicity, a majority of households would save money.
      • Because geography is a key risk-factor, a roughly equal proportion of rural (62.4 percent) and urban (64.2 percent) California households save money with PAYD.
      The California Draft Scoping Plan significantly underestimates PAYD benefits. Below are our recommendations for improving the analysis:

      1. The Draft Plan assumes only a minor portion of insurance premiums would become distance-based. CORRECTION: Evaluate benefits assuming all vehicle insurance premiums and registration fees are converted to PAYD pricing, and the price structure meets minimum standards defined in "Pay-As-You-Drive Pricing: Recommendations for Implementation" ( www.vtpi.org/payd_rec.pdf ).

      2. The Draft Plan co-benefits. CORRECTION: Take into account all significant co-benefits, including crash reductions, congestion reductions, road and parking facility cost savings, consumer savings and affordability, and reduced sprawl, in addition to energy conservation and emission reductions.

      3. The Draft Plan assumes that PAYD would be implemented using electronic instrumentation that tracks when and where a vehicle is driving, which adds costs and raised privacy concerns. CORRECTION: Include "basic PAYD", which uses simple odometer audits or self-reporting, which minimizes costs and avoids privacy risks.
      Real Insurance now offers Pay-As-You-Drive ( http://www.payasyoudrive.com.au ) vehicle insurance in Australia. Under their system, motorists report their odometer reading at the beginning of the policy term and purchase a certain number of miles. Odometer readings are verified if there is a claim, giving motorists an incentive to be accurate (false odometer readings void coverage).
      Research by professors David Grabowski and Michael Morrisey indicates that higher fuel prices significantly reduce traffic fatality rates: their analysis indicates that each 10% fuel price increase reduces total traffic deaths 2.3%, with a 6% decline for drivers aged 15 to 17, and a 3.2% decline for ages 18 to 21 according to analysis. See "As Gas Prices Go Up, Auto Deaths Drop," ( http://news.yahoo.com/s/ap/20080711/ap_on_he_me/auto_deaths_gas_prices ); and '10 Things You Can Like About $4 Gas,' in "Time Magazine" ( www.time.com/time/specials/packages/article/0,28804,1819594_1819592_1819582,00.htm ). These findings are consistent with other research on the safety benefits of mileage reductions, summarized in our report, "Safe Travels: Evaluating Mobility Management Traffic Safety Impacts" ( http://www.vtpi.org/safetrav.pdf ).
      Joe Cortright (2008), "Driven to the Brink: How the Gas Price Spike Popped the Housing Bubble and Devalued the Suburbs," CEOs for Cities (www.ceosforcities.org); at www.ceosforcities.org/newsroom/pr/files/Driven%20to%20the%20Brink%20FINAL.pdf . This report shows the economic benefits to households and communities that result from more accessible, multi-modal community development. It supports the concept of "Location Efficient Development" ( http://www.vtpi.org/tdm/tdm22.htm ).
      Jeff Rubin and Benjamin Tal (2008), "Heading for the Exit Lane" and "Getting Off the Road: Adjusting to $7 per Gallon Gas in America," published in StrategEcon, CIBC World Markets Newsletter ( http://research.cibcwm.com/economic_public/download/sjun08.pdf ). This paper summarizes research indicating that high fuel prices are likely to continue into the future.
      John Pucher (2008), Cycling For Everyone Report, ( http://policy.rutgers.edu/faculty/pucher/Cycling%20for%20Everyone%20VANCOUVER%2024%20June%202008.pdf ). Also see the "Cycling For Everyone" video: http://www.sfu.ca/city/city_pgm_video020.htm )
      Please let us know if you have comments or questions about any information in this newsletter, or if you would like to be removed from our email list. And please pass this newsletter on to others who may find it useful.

      Todd Alexander Litman
      Victoria Transport Policy Institute (www.vtpi.org)
      Phone & Fax 250-360-1560
      1250 Rudlin Street, Victoria, BC, V8V 3R7, CANADA
      “Efficiency - Equity - Clarity”