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Press Release · February 16, 2011

Encourage Jobs Near Transit, Raise Cost of Driving to Put State on Road to Change

Analysis Reveals Signs Of Hope—And Warning—About Meeting SB 375 Goals

SAN FRANCISCO, February 16, 2011—If California is to achieve its goal of reducing the amount of driving residents do, policymakers should encourage job growth near transit stations and implement strategies that raise the cost of driving, according to a report released today by the Public Policy Institute of California (PPIC).

The PPIC report assesses how well California’s local and regional governments are positioned to meet the targets set under Senate Bill 375, the 2008 law that aims to reduce passenger vehicle use. The law’s main purpose is to reduce the greenhouse gas emissions that contribute to global warming, but it is also expected to have public health benefits by encouraging more walking and biking. SB 375 calls for the state’s major metropolitan areas to reduce per capita emissions from driving about 7 percent by 2020 and about 15 percent by 2035. This will require a major behavioral shift in California, where the vast majority of commuters still drive to work—even if they live or work near a transit station.

“The law encourages an integrated approach to reducing emissions—changing land use patterns to reduce the need to drive, investing in mass transit and other alternatives to driving, and increasing the cost of driving and parking to encourage the use of these alternatives. But it will be up to regional and local leaders to turn the vision into reality,” says Ellen Hanak, PPIC senior fellow, who co-authored the report with PPIC research fellow Louise Bedsworth and Jed Kolko, PPIC associate director and research fellow.

The PPIC analysis draws on a survey of local governments, interviews with land use and transportation planners, and numerous data sources. It reveals reasons for optimism that the state can achieve its goals—but also warning signs.

On the plus side: Transit ridership is increasing, with recent investments directed toward higher-density areas, where they will be more likely to get people of out their cars. Regional transportation authorities and local governments recognize the importance of integrating land use, transit, and pricing policies such as toll lanes, carpool lanes, and parking fees. And, despite the recession, local governments have increased activities to support the goals of SB 375, and they say the policies they have begun to implement have a strong potential to reduce residents’ driving.

But the warning signs are significant. California has failed so far to reap the benefits of its large investment in rail transit. While rail ridership has increased slightly—from 0.9 percent of all commutes in 1990 to 1.4 percent in 2008—the growth is much slower than the pace of transit cost increases and service expansion.

One reason is that transit-oriented development has failed to live up to its potential. Having jobs near transit is more important in boosting ridership than having housing near transit. It’s not hard to see why: while workers can park their cars or bikes at transit stations close to home, they need a way to get to the workplace after getting off the train. But the number of jobs per square mile in California is lower than the national average and declining, a continuation of a decades-long trend of jobs moving out of dense downtowns.

To encourage job growth around transit, the state should consider changes in SB 375, which explicitly favors residential over commercial development near stations. On the local and regional level, specific policies to spur development near transit include relaxing requirements for minimum numbers of parking spaces provided by developers and improving accessibility to surrounding areas through feeder bus services.

The PPIC report notes one more important warning sign: resistance to the use of pricing tools, like higher fuel taxes and road use charges, to discourage solo driving. Local and regional officials are wary of public opposition. But these tools have the highest potential to reduce driving, and they can generate revenue to fill the growing gap in transportation budgets. Coastal regions are making limited use of road tolling to manage congestion and raise revenues. For example, high-occupancy toll lanes are in use in Southern California and the Bay Area that combine free access for carpoolers with a toll option for solo drivers. But for more comprehensive road pricing solutions, state and federal officials will need to take the lead, either by raising the gas tax or introducing general road use fees. Such mileage fees—already in use in other countries and successfully tested in Oregon—are more flexible than the gas tax. They rely on new electronic toll collecting and geographic positioning system technology to charge motorists according to the number of miles driven, time of day, type of road, and type of vehicle.

Driving Change: Reducing Vehicle Miles Traveled in California is supported with funding from The William and Flora Hewlett Foundation and the David A. Coulter Family Foundation.


PPIC is dedicated to informing and improving public policy in California through independent, objective, nonpartisan research on major economic, social, and political issues. The institute was established in 1994 with an endowment from William R. Hewlett. As a private operating foundation, PPIC does not take or support positions on any ballot measure or on any local, state, or federal legislation, nor does it endorse, support, or oppose any political parties or candidates for public office.