What economic benefit does LA really get from its half-cent transportation tax?

In his state of the city address Thursday, Los Angeles Mayor Eric Garcetti touted the economic benefits of big investments in transportation projects. 

Garcetti talked up the city's big spending projects on infrastructure, like those made possible by Measure R, the half-cent sales tax that voters approved in 2008, which is funding construction of five rail lines, highways and bus improvements.

"Over the life of these projects, we’ll produce 560,000 good-paying jobs. That’s more than the entire population of Atlanta," Garcetti said in his speech.

The mayor also urged voters to approve another sales tax proposal for transportation projects in this November's general election. The Los Angeles County Metropolitan Transportation Authority wants voters to agree to expand the existing half-cent tax for another 18 years and approve an additional half-cent for 40 years.

Keep up with LAist.

If you're enjoying this article, you'll love our daily newsletter, The LA Report. Each weekday, catch up on the 5 most pressing stories to start your morning in 3 minutes or less.

Subscribe

The proposal would generate $120 billion for a myriad of transportation projects, including a subway tunnel under the Sepulveda Pass. Metro is airing its list of projects in public meetings through May. 

In a press release Friday, Metro was similarly optimistic about the economic benefit of Measure R. Officials projected the impact of Measure R over the 30-year life of the tax measure amounted to 426,980 jobs and $80.7 billion.

The projections are part of a study by the Los Angeles County Economic Development Corp. commissioned by Metro. Metro officials would not release the study when asked by KPCC for its assumptions in coming up with its economic impact numbers. Officials said the report will be released next week.

Martin Wachs, UCLA professor emeritus in urban planning, said it is difficult to estimate the economic value of transportation projects. While they do create short-term boosts with construction spending and jobs, the key to estimating their value is their impact over the long-term.

"What’s really important to the economy is that an efficient transportation system enables people to conduct business over the long haul," he said.

He said it's reasonable for Los Angeles to be optimistic that any spending on transportation will be worthwhile. But he cautioned that in less dense areas, the return on investment may be slower as ridership and goods movement may take longer to increase and be dependent on future development around the improved transportation.