The Economic Consequences of Photo Enforcement: NMA E-Newsletter #374

Editor’s Note: News that red-light cameras in Jacksonville, Florida, delivered almost $368,000 in profits prompted this recent email exchange between NMA Foundation Executive Director Jim Walker and a city official. Jim’s economic argument against ticket cameras is instructive but clearly fell on deaf ears. His follow-up email is equally powerful. Note the official response to that one as well. Here’s the entire exchange:

From Jim Walker to Jacksonville Officials:

Is it truly OK with the city to voluntarily reduce the size of the Jacksonville-area economy by up to almost $27 million dollars in order to collect $367,661 in profits? Here are the calculations.

The city gets $75 per paid ticket or 47.5 percent of the revenue while the state gets 52.5 percent or $83 per ticket. If the city portion was $2,302,189, then the total collected was $4,849,879 and the state got $2,547,690. That means a total of $4,482,218 was sent to Tallahassee, Arizona and Australia with little or none of it returning to benefit the Jacksonville economy.

The Federal Reserve calculates the “velocity of money” at about six, meaning $1,000 spent on January 1st will circulate about six times in a year to produce about $6,000 in total sales of goods and services by December 31st. That means the Jacksonville economy loses up to $4,482,218 x 6 = $26,893,308 in economic activity that could have benefited your area businesses, their employees, and ultimately your tax base. Even if only half the turnover would have remained local to the Jacksonville area, the loss to your economy is over $13 million dollars.

Is it fiscally sound for Jacksonville officials to cause the Jacksonville economy to be reduced by $13 million to $26 million dollars in order to collect $367,661 in profits?

Or is that fiscally irresponsible?

From Jacksonville City Councilman John R. Crescimbeni to Jim Walker:

Mr. Walker:

Thank you for your email.

Using your logic (damage to the Jacksonville economy), one might advocate for the abolishment of issuing any traffic citations. Thankfully, I’m not buying such logic and will kindly remind you that the red light cameras were installed for safety reasons, not revenue ones.

Thanks again for your email—and drive safely!

From Jim Walker to John R. Crescimbeni:

The issue is that MOST of the revenue goes to support the bloated state budget (52.5 percent) and the lion’s share of the rest from Jacksonville goes to Redflex in Arizona and Australia (the most scandal ridden camera company). Cities are left with a pittance of the revenue, and large damages to their economy.

This is very different than a ticket issued by one of your officers where most of the money stays in the local economy.

Former Representative Ron Reagan who pushed the authorizing bill through the legislature did an absolutely brilliant job to set up the deal to benefit the state and the for-profit camera companies with most of the revenue. After he left the legislature, he worked with the National Coalition for Safer Roads—a front group for the camera company ATS—to try to expand the market for the for-profit red-light cameras. Anyone who thinks his employment history was a coincidence is likely kidding themselves. The NCSR has also employed Melissa Wandall. Florida’s program was always a money program for the state and the for-profit camera companies, and the latest state report shows crashes are UP at camera intersections.

FDOT even changed the rules on setting yellow intervals to first allow cities to set yellows too short for the actual approach speeds (July 2011), and later to require it at most intersections (September 2013). I spent a day in Jacksonville recently researching some of the camera locations and may have more to say later. Do note that most Florida cities that have tried to extend the yellow intervals for more safety and less predatory ticketing of safe drivers have been prevented from doing so by FDOT. FDOT is an active for-profit business partner with the for-profit camera companies and they don’t care that crashes are up at camera intersections—so long as the $83 per ticket commissions keep coming in to support the state budget.

I testified against Mr. Reagan at committees in two state legislatures, in Pennsylvania in 2011 where the camera program was extended and in Michigan where the combined efforts of the Police Officers Association of Michigan, the National Motorists Association, the ACLU, ABATE, the Mackinac Center think tank, the judges, both major Detroit papers and others stopped the bills to authorize red-light cameras in 2013. Red-light cameras remain blessedly illegal to use in Michigan. Mr. Reagan is a powerful speaker, as are most of the employees and consultants with the for-profit camera companies, but most of what they claim is false.

About a quarter of the Florida cities that had cameras have dropped the programs, and more will follow. More than two-thirds of the California cities that had cameras have dropped them. Red-light cameras are a hated and dying for-profit industry that will end—it is just a matter of time.

From John R. Crescimbeni to Jim Walker:

Crickets chirping.

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