Trolleys may be quaint, but New Haven is proof that they are not outdated.

The New Haven Board of Aldermen’s Finance Committee on Thursday approved a plan presented by the Department of Transportation, Traffic and Parking to create a new “Sustainable Transportation Fund.” The fund will provide for increased trolley service, as well as additional initiatives to support pedestrian, bicycle and public transportation, according to the proposal.

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Testimony by local residents — more than three dozen people were in attendance — was overwhelmingly supportive of the plan. The fund will be supported by a fee increase on commercial parking lots, which will each pay an additional $25 per parking space each year. City officials said the fee comes out to about a dime a day per space, but will lead to increased annual revenue of $300,000 to $350,000.

The increased trolley service will include routes from the train station to downtown, especially between 11 a.m. and 6 p.m. There are currently two daytime trolley routes limited to downtown. Private shuttles, such as Yale’s, transport passengers between downtown and Union Station, but many of them run only in the morning and evening.

Residents’ testimony included a number of reasons to support the proposal, ranging from environmental and social to economic and nostalgic. Many also pushed the board to increase marketing of the trolleys, whose ridership has declined over the last couple of years — something the head of the transportation department Mike Piscitelli said the city is committed to doing.

A member of the Yale Student Environmental Coalition, Kevin Currey ’09, testified that the committee should support the proposal because of the environmentally friendly nature of the electric trolleys, but he said he agreed that the committee should continue to find ways to reduce the overlap between the various private routes. He said such a step could help reduce the city’s high air pollution, which he leads to health problems such as asthma.

The trolley service is also currently free of charge, and most residents who testified said they hope it will remain that way, since trollies are the primary means of transportation for low-income residents and senior citizens. Even for those not headed to the train station, the trolleys provide a valuable service, local resident Mary Johnson said.

“It helps people who have difficulty walking, handicapped citizens and mothers with young children,” Johnson said.

While one man objected strongly that the new services would be paid for by “taxes upon taxes upon taxes” on a small segment of the population, which would support the needs of special-interest groups, no one on the board expressed similar concerns.

Other aldermen said they did have some concerns, though not about the benefits of the trolley. Ward 5 Alderman Jorge Perez questioned a provision in the ordinance that would give garage owners only 60 days to comply with the new fee. Perez asked Piscitelli, who presented the plan for the city, how the commercial parking garages would come up with the money on such short notice.

But Piscitelli said none of the businesses had raised such concerns and they have been aware of the proposal since July. The only problem that emerged in discussions with parking lot owners was whether hospitals might someday be incorporated under the ordinance, leading the city to specifically exempt hospitals, he said.

Private businesses with lots for their customers are also exempt, so only garages that charge for their spaces will pay the fee, Piscitelli said.

He said the city will also seek money from advertising and corporate sponsors, as well as the Connecticut Department of Transportation. He said 45 percent of residents do not take single-occupancy vehicles to work.

“The trolleys can do much more to contribute to [a positive] downtown lifestyle,” Piscitelli said.

If the city can secure extra financial resources, Piscitelli said, they will use them to install bike racks and bike lanes and to improve crosswalks for pedestrian safety.

City officials also presented plans for upcoming negotiations with municipal unions, which will include a discussion of pension benefits.