How Driverless Cars Could Be a Big Problem for Cities

Like a growing number of cities, Austin, Texas, is getting ready for the arrival of autonomous vehicles. On any given afternoon, self-driving test models can be seen darting along a Formula One race track. More than 500 electric vehicle charging stations are already spread throughout the city. (Autonomous cars are expected to utilize electric drivetrains.) In March, the city council adopted a resolution prioritizing plans for self-driving vehicles.

Austin’s transportation director, Robert Spillar, is working to prepare the city. But earlier this year, a realization hit him about what driverless cars might mean for his budget. “It struck me,” he says. “Half my revenue for transportation capacity and operations improvements is based on a parking model that may be obsolete in a dozen years.”

In the not-too-distant future, fleets of fully autonomous vehicles could be transporting riders all across Austin’s urban landscape, largely eliminating not only the need for private vehicles but also the revenue they currently bring in. Parking fees are a critical funding source for the Austin Transportation Department, accounting for nearly a quarter of its total budget. Driverless vehicles would also cut into parking tickets and traffic citations, two other significant revenue streams for Austin and many other cities. “Municipalities generate a whole lot of revenue as a byproduct of parking management and traffic enforcement,” Spillar says. “If all that suddenly disappears, we’ve got a huge financial issue to deal with.”