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Open Access Publications from the University of California

A Quiet Revolution in Transportation Finance: The Rise of Local Option Transportation Taxes


During the 20th century the United States built a partnership for financing surface transportation infrastructure that included local, state, and federal expenditures, and relied heavily on user charges to cover the costs of these investments. This paper examines recent changes in the nature of this partnership that are significant, but rarely noted. Policymakers are devolving fiscal responsibility from federal and state to local governments, by increasingly authorizing the use of local option transportation taxes. This trend substitutes general taxes for user fees and charges, and shifts decisions about major transportation projects into the electoral and legislative arena. These changes have significant implications for our understanding of the future or metropolitan transportation planning, and the ways in which we seek to reconcile transportation investments with other public policy objectives.

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