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Analysis & News on the Future of Public Finance

CSG: Congestion Proposal in California

Assembly Bill 3059 would remove legal barriers at the state level and allow local jurisdictions to pass their own congestion pricing pilot programs, called “Go Zones,” in four unnamed California cities. The bill says two pilots would be in Southern California and two in Northern California. Existing law prohibits local entities from “imposing a tax, permit fee or other charge” in ways that would create congestion pricing programs, according to the bill text. Many believe that San Francisco would be the first city to move forward with such a plan should the legislation pass.

In 2016, San Franciscans were overwhelmingly against congestion pricing; 72% of those surveyed said they opposed such a scheme in the San Francisco Chamber of Commerce’s annual Dignity Health CityBeat Poll. At the same time, a study conducted by the SF Department of Public Health in 2011 found that charging drivers $3 to enter downtown could reduce collisions with pedestrians citywide by 5%, the San Francisco Examiner previously reported. Within downtown itself, collisions would decrease even further, by 9%, according to the study.

The bill would devolve most of the details of a local plan to the localities. The local regulations would need to specify the duration of the congestion pricing demonstration pilot project and the amount of congestion pricing charges to be imposed. Adjustments for low income residents would have to be established by local law. Collection and enforcement mechanisms would also need to be outlined by local authorities, and they would need an active transportation plan to implement transportation alternatives, among “other necessary and related matters,” according to the bill text.

The bill goes to committee as a SF City Supervisor announced that he will propose a ballot initiative which would task San Francisco with assessing taxes for Transportation Network Companies, as Uber and Lyft are legally designated in California. Uber already pays gross receipts tax on income generated in San Francisco.