Pass Prop E in San Francisco

Increased parking tax will help discourage driving and improve Muni

Proposition E is one part of the San Francisco Group's long-term efforts to reduce the city's production of air pollution and global-warming gases. The measure, placed on the ballot by Supervisor Chris Daly at the Group's behest, would raise the parking tax to induce people to drive less in San Francisco.

The increase from the current 25% up to 35% would add about $22 million to the General Fund. We hope that the small increases in parking fees which may follow the tax increase will induce more people to use transit or carpool. This small decrease in driving will result in a large decrease in congestion, which in turn will help Muni improve transit reliability and speed.

Unlike other taxes, a parking tax is not a noticeable cost to employers. It is less regressive than a sales tax, because it can be avoided and because those with less income typically drive less, and often don't own cars. Unlike a sales tax, an increase in the parking tax will have no impact on downtown retail because most of the short-term parking downtown is in city-owned garages, where short-term rates are typically only raised along with Muni fares or to help fund Muni. Since part of the increase should help Muni, the Metropolitan Transportation Agency will in fact be able to delay the next fare increase or increase in short-term parking rates.

Garage owners will try to raise parking fees to cover the tax increase. Garage and lot owners in San Francisco have been enjoying windfall profits resulting from the city's wise 1962 planning policy to limit the number of accessory parking spaces in downtown (to reduce congestion and to induce people to use transit). Recovering some of this windfall is only fair.

If the parking tax should bring an increase in parking rates, this should be considered as a small correction to the immense subsidies provided to drivers. (Based on costs estimated from 1992 to 1996, without considering the cost of recent oil wars and lives lost, the Sierra Club estimated the subsidy to gasoline as $5 a gallon. See www.sierraclub.org/sprawl/articles/subsidies.asp.

Those who continue to drive should see the parking fee as a congestion-reduction fee, not a tax, because higher parking fees will induce more commuters to use transit or carpool, as more than half of downtown workers do already.

Distributing the revenues

Currently, parking-tax revenues go 40% to Muni, 40% to the General Fund, and 20% to seniors. A ballot measure locking in this distribution would have required a 2/3 vote rather than only a majority. Prop E does not specify the uses of the revenues, and therefore, as soon as it passes we will request that the Supervisors allocate some of the new revenue to help fund Muni. We expect that most of the money will be used for essential city services such as health care for the needy.

Since 1999, the year when Proposition E established the Municipal Transportation Fund, the price of diesel fuel has almost tripled. We will ask the Supervisors to use the new parking-tax funds to permanently increase Muni's annual base-support level to cover this cost increase.

We will ask the Supervisors also to fix an inadvertent problem in the tax increase. City-owned garages also have to pay the parking tax. All of their revenues above the parking tax go to Muni, and so without further action, the increase in the parking tax would decrease Muni revenues by about $2 million. This amount, therefore, should also be permanently added to Muni's base amount from the General Fund. The Recreation and Park Department will have a similar need because city garages under downtown parks must also pay the parking tax, and RPD needs the money for park maintenance.

If the General Fund does not fund these two items, Muni will have to eliminate the shortfall by cutting service, delaying essential maintenance, increasing parking fees, or increasing fares.

WhatYouCanDo

To help in this important campaign for Prop E, contact or call (510)848-0800, ext. 304