Could High Gas Prices Have Positive Side Effects?

With The New York Times reporting an increase in mass-transit ridership as gas prices continue to climb, I’m reminded of my days as a mass-transit commuter, when I got rid […]

With The New York Times reporting an increase in mass-transit ridership as gas prices continue to climb, I’m reminded of my days as a mass-transit commuter, when I got rid of my car so I could ride the rails daily. I ditched the car because there was no economic benefit to having both an automobile and a monthly rail pass — the cost of a New Jersey Transit train ticket is well beyond what would be considered reasonable.

With conventional wisdom indicating that the era of cheap gas is long gone, and with some predicting that a gallon of gas could approach $5 as soon as Summer 2008, it’s now actually economically beneficial to take the train. That said, no matter the cost of gas, even back in 1998 when a barrel of crude hovered around $25, it should always be more economically sustainable to take mass transit.

These days, NJ Transit and Amtrak are being rewarded from not their own initiative, but from other market forces. But considering the infrastructural improvements needed along the Northeast Corridor, including installation of the planned $7.6 billion Trans-Hudson Express Tunnel — a project that is expected to double the number of trains per hour that can travel under the Hudson — commuter costs, like gas prices, are unlikely to decline in the foreseeable future, despite the increase in ridership.

Amtrak owns and operates the tracks on which New Jersey Transit’s Northeast Corridor runs, and of course, we know that the federal government is woefully behind when it comes to thinking about a world that is not car-oriented. As such, Amtrak, despite a more than 5-percent increase in ridership reported in 2007, is still threatening to slash services because of a lack of proper federal funding.

This month, leadership in the House Transportation and Infrastructure Committee introduced a bipartisan bill that, in part, sponsors $14.4 billion in grants for Amtrak over the next five years. Project preference would be administered by the DOT secretary and would be based on several criteria, including those that link passenger rail service to other modes of transportation. The bill is good news for Amtrak’s Northeast Corridor line, but despite receiving $1.35 billion in federal funding in FY2008, Amtrak continues to be underfunded, according to Rep. James Oberstar , the Minnesota Democrat who chairs the committee.

So while there is some good news, albeit minor, from the government, people have yet to gravitate toward mass transit when it’s often more convenient to drive. It’s encouraging that in the Northeast, there is something of a transit village renaissance afoot. Redevelopment is taking place in some of the oldest transit villages, and New Jersey Transit is partnering with a handful of bedroom communities, looking to build housing and retail and other commercial space around existing rail lines. And while those communities will include affordable housing as well as provide accommodations for empty nesters, driving will continue to be the most viable option for commuters.

This is most represented by the fact that 70 percent of New Jerseyans live within five miles of a transit stop, and that, while NJT ridership hit a record 23 million in 2007, roads are still crammed, and driving remains, to many commuters, the most viable mode to get from Point A to Point B.

This is, incidentally, New Jersey, which is the most densely populated state in the country. Communities in the Southern and Western parts of the country where the driving culture is even more pronounced are seeing 10 to 15 percent increases in mass transit ridership, according to The New York Times report.

But in the Garden State, where the prospect of build out is as real as global warming, planners, developers, and local governments are getting aggressive on directing growth back to urban centers using Transit Oriented Development, or TOD. This is high-quality development where — can you imagine? — bikes and scooters are the norm.

Peter Kasabach, executive director of New Jersey Future, said at a recent conference that examined using development and transportation to address climate change that creating conveniently located housing could significantly reduce the number of miles Americans drive, thus reducing the nation’s carbon footprint.

Carbon footprint reduction is not the only benefit of thinking in a TOD context. Kasabach says that building housing, both affordable and otherwise, near transit and commerce, would increase the level of workforce housing. The lack of this type of housing is regarded as one of the major obstacles in attracting and retaining major businesses in New Jersey. New Jersey residents, according to a Brookings Institution report commissioned by New Jersey Future, pay the country’s highest housing costs, while having the third-longest commute to work.

There is a rub, however. Municipal leaders throughout the state are hesitant to create more housing for families amid concerns that increases in tax revenue from new housing would not necessarily offset the cost of educating increased numbers of school children.

While the New Jersey State Legislature has for decades teased the constituency with real property-tax reform, it has yet to address the issue, so organizations like New Jersey Future are attempting to address it themselves. A potential solution could come in the form of state subsidies that finance increases in public education costs as a reward for municipalities developing housing around a center, ideally near transit.

Could the twilight of the Era of Cheap Gas usher in the dawn of the Era of Mass Transit and Transit Oriented Development? Only time will tell, but once transit agencies like NJ Transit begin to benefit from outside market pressures, it seems like only a matter of time before rising gas prices start to dictate other market economies as well.

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