Street Maintenance Fees and Fairness

The Strib reports: St. Paul street maintenance fees under scrutiny

The city will collect $25 million in right-of-way (ROW) fees in 2011 to pay for such street maintenance as plowing, cleaning, salting, tree trimming and street lighting. Property owners are charged per foot of right-of-way frontage. The charge is assessed by property classifications, which factor in locations and type.

All St. Paul property owners whose land abuts a public right-of-way are assessed a street maintenance fee. Although in place for a century, former Mayor Randy Kelly pushed to increase the fees starting in 2003, partly to keep a campaign promise to hold down the property tax levy. The fees also are a means for the one-third of city property owners who are exempt from property taxes -- such as government agencies, schools, churches and charitable organizations -- to pay for maintaining the streets they use.

As a commercial property owner on a corner, Schumann pays per foot for both the Grand Avenue and the Oxford Street right-of-way frontage. In contrast, residential homeowners on corners pay just for the shorter of the two street frontages.

The problem is the unfairness of the basis for collecting the fees, and it seems this is a perfect case where a different basis for assessing fees would be useful. For instance, a Transportation Utility Fee, which was proportional to trips generated rather than to street frontage might be fairer. See our paper for an illustration:

Junge, Jason and David Levinson (2010) Economic and equity effects of transportation utility fees. Presented at 89th Transportation Research Board Conference, January 2010, Washington , DC. <emJournal of Transport and Land Use (in press)