RALEIGH – Bad ideas come from lots of different sources: ignorance of the facts, faulty logic, personal prejudices, etc. The Triangle Business Journal has a report out about a particularly bad idea that originates, I think, in a wrongheaded analogy.

The idea is for North Carolina to create a statewide $1 billion+ mass-transit fund to mimic the operation of the Highway Trust Fund, established in 1989 and funded by dedicated revenue from taxes on motor fuels and cars. Sam Hunt, who as a state legislator helped write the bill creating the Highway Trust Fund and later went on to serve as a transportation secretary under Gov. Jim Hunt, told TBJ that a Transit Trust Fund would be a reasonable application of a “proven concept” in yet another area of transportation funding.

No. The two concepts are completely dissimilar.

Streets and unlimited-access highways were funded and operated by governments for a technical reason: it was prohibitively costly to collect user fees every time someone traversed them. Instead, travelers were charged indirectly for the use of the infrastructure, via charges levied on the purchase of automobiles and the consumption of gasoline or diesel. Roughly speaking, these taxes and fees rose in proportion to use. They weren’t exactly market prices, but they also were not simply general-revenue sources devoted to road-building and maintenance on a discretionary basis. In order for the system to work properly, these funds needed to be earmarked and kept separate from the General Fund.

At the local level, the analogous structure would be Enterprise Funds used to operate charge-for-use infrastructure such as water and sewer systems. Generally speaking, folks who live outside a jurisdiction and deriving their water from wells or private systems are not forced to pay for government-provided water. Ditto for public power – generally speaking, North Carolinians who buy their electricity from Duke, Progress, or N.C. Power are not supposed to be charged again to help pay the bills of those who buy their electricity from municipal power companies.

Charge-for-use infrastructure is in a fundamentally different category from core government functions such as law enforcement as well as from entitlement programs such as public education or income redistribution. In the former case, law enforcement, it would be unjust and grotesque to impose a significant amount of the cost on users (such as victims of crime). In the latter case, entitlements, the user-pays concept makes little sense because the whole idea (regardless of one’s views of its propriety) is to redistribute resources by taxing the general population and then serving a subset of that population.

With regard to mass transit, the trust-fund concept is inapplicable. No one truly believes that charging transit users fees, directly or indirectly, would come anywhere close to paying for transit service. Setting up a Transit Trust Fund to guard passenger-derived taxes and fees from legislative misappropriation would be a pointless exercise, and its advocates don’t mean that, at all.

Instead, they propose to levy new taxes and fees on people who don’t use transit to finance a state trust fund to pay for train and bus service in some parts of North Carolina to serve a small fraction of North Carolinians. It would be akin to setting up a system to charge municipal water customers a special, higher rate to help defray the expenses of households with wells and septic tanks. If you want to do that, fine, but don’t pretend that it is anything like a trust fund or enterprise fund.

Transit boosters, naturally, love the idea of setting up a statewide Transit Trust Fund. They want to disguise how much rail transit, in particular, will cost local taxpayers and how little such transit lines will benefit these taxpayers. Pretending that gobs of construction money will now flow “from the state” is a useful element of the disguise.

But it would be a significant departure from the trust-fund model, properly understood, as well as an egregious misuse of the English language. It’s the kind of thing that ought to make taxpayers distrustful of their political leadership.

Hood is president of the John Locke Foundation.