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This U.K. City's Controversial Parking Tax Shows How To Fund Public Transit

In just four years, Nottingham's tax has already paid for two new tram lines and other bus and rail improvements.

This U.K. City's Controversial Parking Tax Shows How To Fund Public Transit

[Photo: Flickr user Lee Haywood]

Nottingham, England, is the first U.K. city to levy a tax on parking in order to pay for public transport. In 2012, the city began taxing commuter parking spaces, after a period where employers were required to license any parking spaces available to their employees. In four years, the new tax has already paid for two tram lines, improvements to the city's railways station, plus support for bus services, and—yes—even parking management.

While other cities try to curb car travel into their centers with "congestion" charge schemes, like the one in central London, Nottingham decided against it. Better Transport's Stephen Joseph tells us why:

Efficient in economic theory though [a congestion charge] might be, Nottingham looked at it and decided that it would be very costly—all those cameras and enforcement—and would not target peak hour traffic jams and single-occupancy car commuting as effectively as the levy would.

Not that the tax was easy. It took 10 years of fighting against lobby groups, employers, and the Chamber of Commerce. They used the usual arguments: that businesses would relocate, that Nottingham would be a ghost town, and others. Opposition was fierce. And yet once the tax went into effect, none of these predictions came true—quite the opposite. Thanks to the double whammy of curbed car use and improved public transport, use of that public transport now accounts for over 40% of all journeys. That, says Joseph, is a "very high percentage for the U.K." Job growth has been faster than in Nottingham than elsewhere, and, says Joseph, the tax "has also helped Nottingham reach its carbon reduction target a few years early." Even car users get a benefit, because traffic congestion has also dropped since the tax was levied.

Nottingham has long been forward-thinking about public transport. It retained public ownership of its local bus service when most other cities and counties were selling them off to private companies, and in 2004, it opened the first line of a new tram network. And yet it took a particularly strong political will to bring this tax into being. The result, though, isn't just good for Nottingham. The success of the scheme also serves as a proof of concept for other cities who wish to do the same. They will likely struggle, too, but perhaps not quite so much, and of course they too will add to the evidence that making things difficult for drivers is a great way to reduce car use in cities.

In fact, it might already have started. According to the Jarrett Walker of the Human Transit blog, Cambridge in the U.K. is now also considering a workplace parking levy, which it hopes will raise $14 million to spend on buses.

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