Clarifying Costs: How Taxes Are Spent

1. Clarifying Costs: How Taxes Are Spent Jennifer Kalczuk jkalczuk@ridetherapid.org 616.456.7514

2. The Rapid • Transit system serving Grand Rapids—Michigan’s second largest city—and its suburbs • Buses, paratransit, parking and airport shuttles • 21 fixed-routes • Ridership is growing quickly: • From ’05 to ’06, increased 13% • From ’06 to ’07, increased 15% • ’07 year end projection of over 8 million rides • Two previous successful millages (2000, 2003)

3. The Situation • COA provided a map for operational growth. Phase I could be done with existing budget. Phase II required additional funds. Decision was made to ask for additional local funds. • Michigan’s economy is very poor. Significant discussion of raising other state and local taxes—uncertainty about what else people may have to pay. • Additional tax increases on the ballot. The biggest was a significant increase for the community college.

4. The Plan • Agency developed an image and education campaign. • Friends of Transit reactivated to advocate. • Professional election strategy firm was hired as campaign manager. • Agency marketing firm donated services to FOT to insure message was consistent and materials complimented each other.

5. Image Campaign • Began running in January 2007 • Consisted of radio, television, and bus board advertising. • Newspaper insert ran about a week before the election. • Based on persuasive messages uncovered in pre-election surveying. • Focused on The Rapid’s role in the community.

6. Rapid Materials

7. Friends of Transit • Raised about $80,000 for their campaign. • Elements included several direct mail pieces, radio and newspaper advertising, friend to friend cards, yard signs, and a web site. • Work began in January; campaign kick-off was six weeks before the election.

8. FOT Materials

9. FOT Materials

10. Grand Rapids Area Chamber of Commerce Wyoming-Kentwood Chamber of Commerce West Michigan Environmental Action Council Kent County Republicans Kent County Democrats Grand Rapids Press Michigan Land Use Institute Clean Water Action Disability Advocates of Kent County Area Agency on Aging Several business and neighborhood associations Friends of Labor Grand Rapids Area Realtors Progressive Women’s Alliance Grand Rapids Area Center for Ecumenism Partial List of Endorsers

11. The Complication

12. The Complication

13. The Complication • First time we faced organized opposition. • Used bus ad, web site, limited radio and web advertising. • Found allies in conservative local radio talk show hosts. • Received significant media coverage. • Changed message—toned down anti-transit rhetoric when that didn’t get a lot of traction.

14. “Myths vs Facts” on STR website • Web site contained a number of “myths” about The Rapid—not really better for the environment, not getting people to work, not reducing congestion, etc. • “MYTH: The Rapid is a cost-effective way to offer public transit” based on not including capital costs in per mile. • “We don’t know what they are spending all those capital dollars on, but they aren’t getting much of a return for it.”

15. Response Strategy • Clarified local property tax funds are for operating only. • Outlined recent capital expenses and their purpose, including a new $23 million transfer facility that significantly improved safety, operations, and passenger amenities. • Capital funds come from federal (80%) and state (20%) sources. These funds do represent tax dollars, but eliminating capital projects will not reduce the overall tax rate. Federal and state gas taxes paid by area residents will fund projects elsewhere.

16. Response Strategy • Building Rapid Central Station created local construction jobs, and supports on-going service contracts with local vendors. • Capital projects are an investment in our area. • Various studies peg the return on investment from $3 to $9. All agree that you get back more than you pay.

17. Response Strategy • STR compared operating and capital costs of public transit to a per mile operating cost of driving a car—even underestimating these costs by about half of AAA’s guideline. • Didn’t include the costs of designing, building, and maintaining the roadway network or the related costs of parking and enforcement. • According to The Elephant in the Bedroom: Automobile Dependence & Denial : Impacts on the Economy and Environment government subsidies for highways and parking alone amount to…the equivalent of a fuel tax of approximately $3.50 per gallon. If this tax were to account for "soft" costs such as pollution cleanup and emergency medical treatment, it would he as high as $9.00 per gallon.

18. The Results • Millage passed 58% to 42%. • Other tax requests failed, most notably an increase for Grand Rapids Community College—we out-polled them in just about all precincts, meaning voters chose us. • Failed in 3 cities, but carried by vote of the whole; the widest margin was a swing of less than 200 votes to change the outcome.