Myth: Cyclist Don’t Pay for Roads

Pedal to the metal, the sticky 2-litre bottle of mountain dew precariously fitting in the already over-sized cup holder.  A dragon waking roar comes out of the F-350 with a small press of the gas.  Dip spit splats on the ground as the made-in-America F-350 navigate a road so slim that it looks native to Europe.  On the side of the road, a spandex clad person pedals his way down the street. Oncoming traffic makes it impossible to pass the cyclist safely, the fifty-something year old, lets out a primal growl.
“I would run over those damn bike jockeys if the president wouldn’t throw me in jail over it!”
As soon as there is a clearing, the F-350 kicks up a gear, the bear of a truck roars, RPMs soar like the US deficit.    The F-350 escapes from the close encounter with the cyclist.

Later talking to his buddies over at the lawn fertilizer store, the older man declares his disdain for cyclist.
“They take up the whole road!” he grumbles
“Yeah, they don’t even pay for the roads! So they shouldn’t use them!” His pal Dale responds.

And there we have it, cyclist don’t pay for roads.  A myth so fanciful that it has appeared right next to the Myth of Sisyphus in the 2015 book of myths.

Cyclist don’t pay for roads

The skirmishes between cyclist and drivers are as epic and drawn out as the war between cats and dogs. Tensions always seem high on the road, like tensions in the Formosa straits.  This myth, the one that cyclist don’t pay for roads is an attempt to frame this whole thing as a justice issue.

But, like teen pregnancies, this little factoid could be better served by better education, particularly on how infrastructure is funded throughout the great white northern state of Canada.

But now, with the small taste of knowledge, how are roads funded in Canada?

The Gas Tax
Let me use a tortured journalistic headline to get this ball rolling, “pain at the pumps”, every time you eye your fuel gauge you get frustrated that it’s on empty again.
“I swear to King Solomon that I just filled this damn thing yesterday” you might say
You curse a myriad of people and then you curse the damn government for levying taxes.  As you are buying beef jerky from the gas station you probably wonder how much taxes contribute to the price.

Ontario: 14.7¢ per litre of unleaded gasoline
Federal:  10 ¢ per litre of unleaded gasoline.

So if you’re driving around the province that is yours to discover you pay 24.7 cents per litre in gas taxes (yes, standard HST applies on-top of that).  Our lovely province of Ontario usually gets $2.4 billion a year from it’s 14.7 cents per litre in gas tax.  How much do the municipalities get? $329.9 million and it’s for transit projects.

Our Federated overlords collect taxes and share them with the municipality.   The federal government takes the rosy-faced municipality to the store and says
“hey sport, pick out any project you want”
The gas tax pays for transit, waste water and obviously road improvement (among other things). So here is the first problem with the claim central to the myth . Gas tax doesn’t even exclusively cover roads.

In 2011, since the inception of the Federal gas tax, $13 billion  was given to municipalities for various uses.  28 percent has gone towards roads and bridges, which amounts to $1.7 billion.  The winner is transit at $2.4 billion or 39 percent of the gas tax pie.

If my straw-man of an old man is reading this, while chewing some dip, the rage is probably peaking somewhere north of Tony Soprano’s infamous bouts of anger.  The thought of tax dollars going to transit stings the eyes.

But, please, realize that it’s not a zero-sum game.  Improving transit does improve the roads in more ways than a bag of asphalt and a trowel can.

For instance, think of a congested local road in downtown Toronto, every morning and evening the road is packed to the brim, a sea of metal, bumper to bumper, packed in.  Sure , patch the potholes, but the road is so packed, how do those gas tax fix those problems?

Can the City of Toronto expand the lanes? The  City of Toronto does not have buy-out-skyscrapers-for-road type of money.  So it’s left with managing demand. Get people on transit, improve transit.  The other revenues go to other infrastructure, because, well, we need it. If my paternal answer seems like the equivalent of “because I said so” keep reading on about the infrastructure deficit below.

If all this infrastructure facts were making you dizzy, strap on your seat belt because the story takes a tragic twist, one befitting Romeo and Juliet.   We got a problem here in Canada, we have the infrastructure deficit or infrastructure gap, which stands at about $123 billion.  Deficit and gaps, sound ominous and spooky and well, it is.

So what is the deficit, the gap?

There was the golden age of infrastructure, the 60’s and the 70’s, a day where it was “better back then”, most of our infrastructure was built back then and then guess what, it’s coming all to age at once. After the 70’s were going the way of disco, investment in infrastructure started declining.  It went from an annual growth of 4.8% new infrastructure to 0.1% per year from 1978-2000.

Urbanization and population growth did slow, but not drastically enough to warrant such a downturn,  2000’s to now, investment has been rising like global sea levels, but that doesn’t put a gold star on this problem, it just tracks more recent growth and this new levels of investment does not meet the rehabilitation needs of existing infrastructure.

What compounds this issue is that the province has “downloaded” infrastructure onto the municipalities.  How bad has this download been?  Probably as bad as downloading McAfee anti-virus.  Back in the 60’s the municipality’s was responsible for 30.9 percent of capital stock, today it is responsible for 52.4 percent of capital stock.   How does this new responsibility square with revenues?

How does this new responsibility square with revenues?  Well municipalities only receive 8% of all tax revenues (the province and the feds get the rest of the very big pie).

So what, how do municipalities fund this stuff?  Mostly: Property tax!

The Property Tax
The tax is the lion’s share of how municipalities pay for anything. Nothing mysterious, just the good old controversial property tax.

Guess who pays for property tax? Anyone who owns property?

But cyclist who are poor and don’t own property don’t pay tax

If you have property you pay the tax, if you rent, you probably pay the tax.  Of course not directly, you don’t sign the check to the municipality, but your rents go towards that.

For instance, if it a competitive market and your property taxes go up, do you increase rent on the tenants? Not if that increase will encourage tenants to leave to cheaper shores.  A slum lord, with a monocle so dense that it keeps falling into the fine china at the dinner table, isn’t going to generously dip into revenues to pay for property taxes if he or she doesn’t have to.  If a tax increase is on the block, the renter probably pays if the market will allow.  If not the capitalist club is about to cut up your membership card.

So without resorting to Judge Judy we have solved this case once and for all.  This myth is firmly relegated to the dust bin of falsehoods.   And I am aware that there are some other ways that infrastructure is funded like the building Canada plan for instance.  The federal gives ad-hoc funding for particular projects such as the Herb Gray Parkway in Windsor.  But these are funded by a myriad of different ways, when it comes to the hustle and bustle of your municipality chances are the road was funded by property taxes, so in essence, we all pay for the roads.  Getting the warm fuzzy feeling yet?

Further reading:

Danger Ahead: The Coming Collapse of Canada’ Municipal Infrastructure


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