Ohio Group Offers $olutions for Transit

Cleveland's RTA is facing service cuts and fare hikes. Photo: Angie Schmitt
Cleveland's RTA is facing service cuts and fare hikes. Photo: Angie Schmitt

Ohio is one of the worst states at supporting transit — but it’s not for lack of money.

The latest budget provides just $6.5 million a year towards supporting urban transit across the state. That’s about 63 cents per capita — the eighth lowest of any state in the nation.

There are 27 urban transit systems operating in Ohio, but the state chips in just 2 percent of the cost. Both Cincinnati and Cleveland’s transit system are facing service cuts and fare hikes thanks to changes in state support for transit in the past few years. But Ohio could find the money to support transit, it just lacks the will.

That’s according to new report from the smart growth think tank Greater Ohio shows how easy it would be to assemble a respectable state support for transit. Using three relatively painless strategies, Greater Ohio shows how to increase funding by 18 times, to $123 million.

Here’s what the group recommends — the best from a comprehensive review of 20 potential funding sources:

#1. “Flex” More Federal Money from Highways to Transit

While the state only provides $6.5 million for transit from the general fund, it does help urban transit agencies a little bit by “flexing” federal funds, and making $33 million available a year through a competitive grant program. Greater Ohio says the state should double that amount.

After all, doing so would barely make a dent in the state’s highway budget. Greater Ohio reports $33 million is only enough to nine miles of highway, or conduct 27 miles of repair. Ohio, which has some of the slowest population growth in America, doesn’t really have much of a need for highway expansion. It would have a negligible impact on highway conditions anyway, The Ohio Department of Transportation paved more than 7,000 lane miles last year.

#2. Close the Parking Tax Exemption

Ohio law exempts parking from sales tax. Applying the state sales tax of 5.75 percent to parking would raise an additional $33 million a year that could boost transit funding. That does not include parking meters.

#3. Tax Cars Bought by Out-of-State Residents

There’s a weird loop in Ohio sales tax law that says if you buy a car here, but immediately drive it and register it in another state, you don’t have tp pay sales tax. That means the state loses $57 million in annual revenues that could be applied to transit.

31 thoughts on Ohio Group Offers $olutions for Transit

  1. I assumes most states are like my state in that they force you to pay state sales tax when you register a newly purchased car if that car was purchased out of state. So not requiring payment of sales tax is a way to capture sales from out-of-state buyers. People (say) from Kentucky will suffer no disincentive to purchasing a new car in Cincinnati. If you try to force double payment of sales tax, that market will collapse. You won’t get that $57 million because you would be jacking the price of the car by an additional $1000.

  2. 1) Taking money from fuel taxes to support transit is stealing.
    2) Could be done with legislation.
    3) Paying sales tax in Ohio after paying it before in X state on the same vehicle is an unacceptable double-dip.
    James C. Walker, National Motorists Association

  3. 1) By what logic is taking money from fuel taxes to support transit stealing? If the State is going to fund transit, it is going to have to take money from one revenue source and spend it on a program. Doesn’t matter what the revenue source is, could be a fuel tax, could be an income tax, could be a tax

  4. The pie would certainly shrink, but it wouldn’t completely go away. People in Kentucky, Indiana, Michigan, Pennsylvania, etc… might still find a good enough deal in Ohio from time to time to draw them across state lines to purchase a vehicle, even if the taxes were higher than they currently are.

  5. You could make a case for state support for capital expenditure. You won’t find any stomach for providing funds to support operation. Politician A will buy off Union B with money from district C without a second thought. No one wants to be that milch cow. No one wants to fund the equivalent of Detroit’s pension obligations.

  6. 1) Fuel taxes are user fees designed to pay for roads, NOT transit. Taking them for transit is stealing, just the same as taking school millages to pay for a new courthouse would be.
    2) No, legislation that funds transit is fine. It means the voters in the area and/or their representatives support it. I voted for a local bus millage a few years ago, and just voted to renew it.
    3) If I buy a car in X state and use it for some time (defined in various state laws) and then move to Y state – I should owe no tax to Y state.
    James C. Walker, National Motorists Association

  7. That’s why we only use cigarette taxes to fund tobacco farms, and we only use alcohol taxes to fund breweries and distilleries?

  8. Correctly done, tobacco and alcohol taxes would be used to fund related health care and programs to end addiction to them.
    James C. Walker, National Motorists Association

  9. Correctly done, fuel taxes would be used to fund related transportation programs to end addiction to single occupancy vehicles.

  10. If you support naked larceny from people that rarely if ever use transit – then that is a fine solution for stealing. I think if you research it properly, one of the Ten Commandments says NO.
    James C. Walker, National Motorists Association

  11. I’m pretty sure my property taxes and my income taxes pay for programs that I seldom choose to utilize, or which don’t provide me with a direct tangible benefit. I’m glad that you have implicitly moved on from the specious argument that fuel taxes are part of a special protected class of taxes that is inherently different than other forms of taxation.

  12. Property and income taxes are for the General Fund in most venues. Fuel taxes were set up to support roads and would be doing just fine if the federal and state legislatures had kept the rates adjusted for inflation and the overall fleet economy.
    James C. Walker, National Motorists Association

  13. Governments reallocate resources all the time. Must American roads predate the automobile, and do not exist exclusively for the use of single occupancy motor vehicles.

  14. Exclusively, of course not, but primarily is accurate. I know some fuel tax revenues have been stolen (reallocated), but that does not excuse the theft of what was to be dedicated revenue.

    I get it that some people want to drastically reduce single occupancy trips in cars, but we have a concept in America – it is called freedom. I support it, perhaps you don’t.

    James C. Walker, National Motorists Association

  15. General funds pay for most of roads/parking construction/maintenance costs, policing, medical treatment for collisions, pollution and obesity caused by sedentary drivers, not fuel taxes, vehicle fees and fines. You must know that James. Maybe as part of your organization’s research you can determine how much these costs are and how to pay for them solely from drivers and vehicle manufacturers/resalers, if you demand that fuel taxes only be used for repaving (because that’s what they pay for, not bonded debt for new or widened roads. There are other externalized cost, reduced property taxes for residential property near roads because of noise and dirt and danger.

  16. You support freedom? So I take it that you consider the use of eminent domain to condemn properties for the purpose of building new roads or widening existing roads to ‘increase’ capacity to be larceny?

  17. We became a mobile country with freedom of travel, started in good measure by Henry Ford. A very large percentage of people like the freedom and are most unlikely to give it up. We could fix a lot of the under-funding of road user fees if we could add to the gonadal material of federal and some state legislators.

    The NMA and a large portion of US citizens are unwilling to totally change our society to meet your ideals. We understand your views but respectfully disagree with turning our society upside down to meet what you want.

    James C. Walker, National Motorists Association

  18. We have no problem with areas passing local taxes or millages to support transit systems. I voted for one for our buses a few years ago and just voted to renew it. Eminent domain for roads is not used very often today – although we have an example of it now in Michigan to build a new bridge to Canada. Do note that when eminent domain is used, people are paid for the properties.
    James C. Walker, National Motorists Association

  19. I get the impression that we agree on many points. It’s just that you frame many of your minor disagreements over policy issues in hyperbolic phrases. We both support the use of fuel taxes to pay for roads. We both support a higher fuel tax than exists in most parts of the country (I would probably prefer a pay per mile traveled system in addition to fuel tax to capture vehicles that run on other power sources, but that’s neither here nor there). We both support a range of transportation options. We both agree that government subsidies backed by taxation should be used to fund transportation options. We just disagree on revenue sources, and presumably the relative allocation of funding to different modes of transportation. Yet you throw around terms like stealing and larceny to disparage the use of some tax dollars for some purposes, but not other users of tax dollars. You question my fundamental commitment to the concept of freedom because I think a certain pool of tax dollars should be used in a way that you disagree with. Don’t you see that this is a disingenuous and divisive argumentative style?

  20. It seems we do agree on some basic principles. I prefer fuel tax which is proportional to use, encourages use of fuel efficient vehicles, and is cheap to collect at about 1% of revenue. A per mile tax is expensive to collect, does not encourage fuel efficient vehicles and creates a hackable database of our travels that can be used for criminal and commercial purposes – things almost everyone should reject.

    I have NO problem with taxes the voters have approved to support building transit systems and subsidizing them in perpetuity – IF the voters vote to do that. Voters must recognize that the fare box will NEVER pay for transit – but fuel taxes could if properly set and allocated.

    I have driven in 27 major countries and paid $5 to almost $10 per US gallon for fuel – averaging about $6.00-$6.50 in recent trips. This level of fuel tax is PERFECTLY OK, if the taxes are spent on the roads.

    James C. Walker, National Motorists Association

  21. I can drive an electric vehicle, run my diesel on veggie oil, or put farm fuel in my car to avoid paying gas taxes. I cannot do this if the tax is based on mileage. The tax could be scaled by vehicle type to encourage fuel efficiency. It could also be scaled based on the roads traveled, the time of day, or the level of congestion on the road. Boatloads of location data is already collected on the majority of Americans through their smart phones. That horse has left the barn.

    Most gas taxes in the United States were not approved by voters. They were created as bills drafted by legislatures and signed by executives. There are examples of voter approved gas taxes, such as a ten cent tax that was passed a couple years ago in Portland, Oregon. But these are exceptions.

  22. I understand how VMT could be done by creating a hackable and salable database of everywhere we travel. SOME people are OK with that, some are not. Plus the VMT system would be VERY expensive compared to the very low cost of fuel tax collections. EVs should have a “fuel tax” component in the charging systems which should be required to be on separate meters. It is ludicrous that cities allow people to charge for free. Congestion charging is extremely discriminatory toward many lower income service workers who have fixed work hours centered around rush hours. Middle class white collar workers would find it annoying, many service workers would find it crushing. NO THANKS.
    James C. Walker, National Motorists Association

  23. I guarantee you would immediately get attack ads listing off a similar list of complaints if you proposed the institution of a gas tax that raised fuel prices to a level that was actually high enough to encourage the majority of Americans to choose fuel economy over utility, or which fully funded the infrastructure replacement cost of the existing street network. It also sounds a lot like the logic that is used by many to continually argue for the widening of streets and expressways or the construction of new highways at the expense of open space, neighborhoods, and increasing the sprawl of American cities. The complaints are legitimate, but the same groups of workers that you listed are also negatively impacted by long commute times caused by a lack of urban planning and a lack of transportation options. VMT pricing or congestion pricing would impact shift workers and the poor in exactly the same way that fuel taxes do.

  24. Except with VMT and congestion pricing, you do NOT have the alternative to reduce costs with more fuel efficient vehicles – PLUS the systems are extremely expensive to operate compared to about 1% of revenue for fuel taxes.
    James C. Walker, National Motorists Association

  25. You can scale the cost based on the vehicle type if you want to encourage fuel efficiency. The cost of administration may not be as high as you think, depending on the type of technology used.

  26. The monitoring and collection costs will significantly exceed the existing cost of about 1% of revenue for fuel taxes. And note with fuel taxes, you pay once at a known rate. With VMT plus congestion charges, you get double-dipped and likely severely so in areas where the congestion portion can be very high at peak rush hour commute times that are mandatory for many workers.
    James C. Walker, National Motorists Association

  27. I’m primarily a driver now, although I miss the exercise and immersion in nature of bicycling I have no confidence in motorists sharing the road safely with me. As a motorist, I want to be represented by an organization that advocates for a fair allocation of transportation funding, including reparations for past inequalities in resources. That includes pedestrian comfort and safety, since we are all pedestrians at some point in our travels.
    I want a representative organization that provides education to motorists and politicians about reducing the costs and harms to the individual and our society from our transportation choices and priorities. I also want an advocate for velorutionary advances in human powered transit, assisted with electric motors. If that’s your organization I will join it.

  28. We support some of your goals, but our emphasis is on the traditional drivers’ needs and their freedom to travel when and where they want to. Personal cars transformed our society, albeit with some negatives, but with far more positives.

    But don’t just take my view, explore our whole website to make up your own mind on our interests and goals.

    James C. Walker, National Motorists Association

  29. I’ll check it out, but we already heavily restrict drivers freedom to travel when and where, they’re called roads and traffic laws.

  30. We agree to drive on roads. We agree that traffic laws set with correct traffic safety engineering principles deserve voluntary compliance – and in fact they get it from most drivers.

    We totally object to traffic laws set with deliberately improper and less-safe traffic engineering – primarily for the purpose of setting up for-profit ticket traps enforced with officers or cameras. We think that entirely perverts the very purpose of traffic laws and their enforcement – turning them into for-profit traps at the expense of lower overall safety.

    We support better driver training and similar issues. Have a look.

    James C. Walker, National Motorists Association

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