Management & Operations

Transport costs 18% of disposable income, said Surface Transportation Policy Project

Posted on March 1, 2001

At 18% of total disposable income, transport costs are now second only to housing, said a recent study conducted by the Surface Transportation Policy Project and the Center for Neighborhood Technology. Most of that cost goes into the purchase, operation and maintenance of automobiles. It is also more than most American families spend on food, health care and education. The report looks at government data on consumer expenditures, ranking 28 major metropolitan areas by the portion of the family budget devoted to daily transportation costs. Transportation costs are eating up 36% of the average income of those households earning less than $12,000 per year. For those families, the need to own one or more cars placed owning property out of reach. Households in Houston, Atlanta, Dallas, Miami and Detroit devoted the highest percent of their disposable incomes to transportation. The average household in the Houston area spent 22 cents out of every dollar earned on transportation. The three least expensive metro areas are Honolulu, New York and Baltimore, where households spent almost one-third less on transport. A main reason for the high cost is urban sprawl. Less sprawling places with more efficient land use tend to cost people less. In the one-third of the metros studied found to be most sprawling, households devoted 20% ($1,300) more of their disposable incomes to transportation costs. Suburban areas are dominated by strip malls and office parks. They are harder to serve with efficient public transport and necessitate driving between every destination. That means families now need more cars. “Because of sprawl, driving has changed from a convenient choice into an expensive necessity,” said Roy Kienitz, executive director of the STPP. To keep the price of transportation down, the STPP recommended investing in public transportation, bicycle facilities and developing the city according to principles of smart growth.

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