USING PUBLIC POLICY TOOLS TO SHAPE TRAVEL PATTERNS AND LAND USE DEVELOPMENT IN EUROPE

USING PUBLIC POLICY TOOLS TO SHAPE TRAVEL PATTERNS AND LAND USE DEVELOPMENT IN EUROPE Prof. John Pucher Rutgers University pucher@rci.rutgers.edu http://policy.rutgers.edu/faculty/pucher.htm “Finance: The Critical Link” UCLA Arrowhead Conference October 19-21, 2003

Source: EU Energy and Transport in Figures, accessible online at: http://europa.eu.int/comm/energy_transport/etif/lists/transport.html#Passenger%20Transport; and Federal Highway Administration, Highway Statistics 2002 (Washington, DC: US Department of Transportation, 2003).

Source: Transportation Research Board, Making Transit Work: Insights from Western Europe, Canada, and the United States (Washington, DC: National Research Council, 2001), Table 2-2.

Source: EU Energy and Transport in Figures, online at: http://europa.eu.int/comm/energy_transport/etif/lists/transport.html#Passenger%20Transport; and Federal Highway Administration, Highway Statistics 2002 (Washington, DC: US Department of Transportation, 2003).

Public Policies Affecting Travel Behavior in Europe • High sales taxes and fees on new car purchases • Restricted parking supply, limited parking duration, and high parking prices • High cost and difficulty of getting driver’s license • Limitations on all sorts on auto use (lower speeds, traffic calming, auto-free zones, no through traffic, turn restrictions, residents-only streets, etc.) • Very high gasoline taxes and prices • Congestion pricing experiment (in central London) • Large subsidies to public transport for decades, resulting in high-quality, state-of-the-art systems with attractive fares for regular users • Traffic priority for public transit over private car • Superb facilities for walking and cycling • Commutation subsidies for all travel modes, including walking and cycling, based on distance from home to work (Germany)

Source: EU Energy and Transport in Figures, accessible online at: http://europa.eu.int/comm/energy_transport/etif/transport_means_road/motorization.html

Public Policies Affecting Travel Behavior in Europe • Very high sales taxes and fees on new car purchases • Restricted parking supply, limited parking duration, and high parking prices • High cost and difficulty of getting driver’s license • Limitations on all sorts on auto use (lower speeds, traffic calming, auto-free zones, no through traffic, turn restrictions, residents-only streets, etc.) • Very high gasoline taxes and prices • Congestion pricing experiment (in central London) • Large subsidies to public transport for decades, resulting in high-quality, state-of-the-art systems with attractive fares for regular users • Traffic priority for public transit over private car • Superb facilities for walking and cycling • Commutation subsidies for all travel modes, including walking and cycling, based on distance from home to work (Germany)

Hourly Parking Fees in Selected European Cities, 2003

Source: Energy Prices and Taxes, 2nd Quarter 2003 (Paris: International Energy Agency, OECD, 2003), pp. 316-317.

Source: Energy Prices and Taxes, 2nd Quarter 2003 (Paris: International Energy Agency, OECD, 2003), pp. 291-292.

Congestion Pricing in Central London since February 2003 • Purpose: to counter severe congestion in central London (8 mph average speed) • Charge of £5 ($8) for vehicles in inner zone from 7 am to 6:30 pm, paid by about 100,000 vehicles per day • Payable until 10 pm on day of travel by internet, phone, retail outlets, mobile phones, etc.— penalties for late payments • Surveillance by digital cameras to photograph license plates • Congestion pricing raised avg. speed by 31% overall but by 40% for buses, eliminated 150,000 car trips per day in inner zone, no significant congestion from diverted traffic outside the zone • 50%-70% of ex-car users rode transit instead • Raises revenues of £130 million per year to be invested in improved and expanded public transit (already 300 new buses added) • Equity impact: 90% of car drivers into central London come from richest households

Area of Congestion Pricing in Central London

European and Canadian Cities are Much More Compact than American Cities • Comparing only large cities, Kenworthy (2002) found that in 1995, European cities were about twice as dense as Canadian cities and almost four times denser than American cities (55 vs 26 vs 15 persons per hectare). • European and Canadian cities are also less polycentric than American cities, with central cores that have remained vibrant and far more dominant over their metropolitan regions than American cities.

German Regulations and Planning Policies Affecting Land Development Patterns • Exclusion of vast amounts of agricultural land, forests, parkland, and other open space around metropolitan areas for any commercial development • --Restricts supply of land and raises land price • --Forces compact development to save on land costs • Integrated federal, state, regional, and local land-use plans which are detailed, enforced, and highly restrictive of new commercial and residential development • Coordination of land-use plans with environmental and transport plans at each government level, especially at regional level • Limited land-use competition among localities, since land-use plans are coordinated among communities within a region, and tax base is shared

Public Finance Policies Affecting Land Development Patterns in Germany • Fees assessed by all local governments on private developers to finance public infrastructure costs of sewers, sidewalks, lighting, utility lines, streets in new suburban developments • Both vertical and horizontal sharing of all three tax bases (income, sales, and property taxes) among governments—much less fiscal competition among local governments than in USA • Tax revenues distributed by federal and state governments to regions and cities to favor dense urban centers that provide a wide range of public services to their surrounding regions • Most school construction costs and all teacher salaries are paid by the state government, not local communities—school financing thus independent of local fiscal capacity, but best schools are generally in the city center, not in the suburbs, as in USA • Homeowner subsidies are only for low and moderate-income households, only once per lifetime

Policy Implications of European Experience for the USA • Strong government controls, high taxes, large subsidies, land scarcity, and coordinated land-use and transport planning in Europe have been largely responsible for the much more compact development and lower levels of car ownership and use compared to USA. • Only in crisis situations have Americans been willing to accept such extreme government intervention in land use and transportation, with much more reliance on market outcomes, private preferences, and short-term rather than long-term considerations. • Main approach to solving our transport problems has been technological rather than behavioral, as in Europe, and has focused on supply-side strategies rather than demand-side restrictions. • American states that have been most innovative in land use and transport planning have been prompted by severe problems (pollution, congestion, lack of space) and/or by very strong environmental movements.

For any questions or further information, please feel free to contact: Prof. John Pucher Rutgers University Email:pucher@rci.rutgers.edu http://policy.rutgers.edu/faculty/pucher.htm For free PDF and Word downloads of publications, see either of the two Rutgers University websites: http://policy.rutgers.edu/tpi/articles.html or http://policy.rutgers.edu/papers

USING PUBLIC POLICY TOOLS TO SHAPE TRAVEL PATTERNS AND LAND USE DEVELOPMENT IN EUROPE