Transportation Costs 2018 — One Key Factor of Where to Live

The average American’s commute time to and from work (according to a study by Wall ST 24/7 based on analyses from the Economic Policy Institute’s Family Budget Calculator)is:

  • 27 minutes twice a day
  • 270 minutes a week
  • 13,500 minutes per year (for 50 weeks per year or 225 hours which equals  28+ days)

When added with trips to and from shopping, medical, and entertainment, the average transportation costs for a single adult vary from $435 per month to more than $1,000.  The Economic Policy Institute’s Transportation costs were described as follows:

Transportation expenses are a combination of the costs of auto ownership, auto use, and transit use. Transportation cost data were provided by the Center for Neighborhood Technology (CNT). CNT created a modified version of transportation costs from its Housing and Transportation Affordability Index to account for differences in family types in the Family Budget Calculator.

While a home is usually the most single largest cost for the typical U.S. household, transportation typically ranks second or third depending on childcare expenses. For some, however, it can be the largest monthly expenditure.

The following table shows the top-10 most expensive transport-cost cities based on a study by 24/7 Wall St.  Not only did California garner all of the top-10 spaces, they accounted for 16 of the top 20.

Fuel is a major component of transportation costs.  The next two tables show the states with the greatest and least cost of regular gasoline per gallon, including all state and local taxes, as reported by AAA on September 28, 2018.    At $3.81 per gallon (regular) Hawaii has the most expensive – which is not surprising given the shipping requirements for crude oil to feed Hawaii’s two refineries located on Oahu.  Hawaii has zero petroleum reserves or production — hence the need to import all feedstock.  Nor does Hawaii have any interisland pipelines to more cheaply deliver refined product to the other islands, resulting in greater fuel transportation costs.  The least expensive gasoline on a statewide basis is a tie between Alabama and Mississippi at $2.56 per gallon.  When compared to Hawaii, gasoline is these two states is 32.8 percent less or $1.25 per gallon.

Much of the difference in gasoline prices across states can be attributed to the differences in state-specific gasoline taxes and fees.  The next two tables (which include the same data as above) are sorted on gasoline taxes imposed by each state.  Naturally there is a strong statistical correlation between the cost of a gallon of gasoline and included taxes.

Included in the following table are average gasoline costs all the state fees and other taxes (as aggregated by the Tax Foundation from the American Petroleum Institute) as of July 2018. In addition to the state fees and taxes, the U.S. has a federal tax of 18.6 cents per gallon.

To view the 28 cities in the U.S. with the most expensive transportation costs click  https://www.usatoday.com/story/money/2018/09/25/transportation-costs-cities-most-expensive/37866627/

See the average costs of all ranges of gasoline and diesel fuel from the AAA click https://gasprices.aaa.com/state-gas-price-averages/  When on this site, by clicking on any state a map with a breakdown of gasoline prices by county (or equivalent) is shown.

Gasoline state taxes and fees as of July 2018 can be read at the Tax Foundation at https://taxfoundation.org/state-gas-tax-rates-july-2018/

Access the Economic Policy Institute’s Family Budget Calculator at https://www.epi.org/resources/budget/

Given material transportation costs, prospective homebuyers need to include these expenses when deciding which home to purchase.

Ted

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