Why Transit Agencies Expand Capacity While They Cut Service

The past couple of years have been bittersweet for American transit riders. While the Obama administration’s TIGER grant program and livability initiatives have spurred investments in new streetcar and bus projects, service cuts and fare hikes have been the order of the day in cities large and small, as transit agencies cope with shrinking revenues brought on by the recession. It can be frustrating for transit users to witness the construction of expensive new facilities while they’re paying more for less service.

Protesting TriMet service cuts last month. ##http://blogs.wweek.com/news/2010/09/01/protesters-rally-in-response-to-trimet-fare-increase/##Willamette Week##
Protesting TriMet service cuts last month. ##http://blogs.wweek.com/news/2010/09/01/protesters-rally-in-response-to-trimet-fare-increase/##Willamette Week##

At Rail~volution, transit agencies gave their side of the story, letting attendees get inside their heads as they engage in the sometimes-inscrutable tug-of-war between spending on capital projects (maintenance and expansion) and operations (service).

Some transit officials think that in order to keep service from slipping any further or fares from going any higher, they need to maintain their customer base – and that the prospect of new facilities might keep them there.

But others see the reverse as being true. “If people like the service they have,” said former Massachusetts Transportation Secretary James Aloisi, Jr., “even if it’s inferior to what you know it could be, they’ll support efforts to expand it.” So maintaining a high level of service can also build political support for capital projects.

The Federal Firewall That Shuts Out Transit Operations

Federal transit funding is directed almost exclusively toward capital expenses (including maintenance) and is rarely available for operating costs. In order to take advantage of federal funds, transit agencies have to come up with new capital projects. They can’t just ask for help to hire bus drivers.

And judging by the comments at Rail~volution, that’s just the way the transit agencies like it.

Transit workers and advocates around the country have organized to gain access to federal funds for operations, and they’ve been joined by some urban transit agencies. But Aloisi of Massachusetts spoke for many of them when he said, “I’m not sure I want the federal government too deep into my operations. You just don’t know what would come with that.”

Neil McFarlane, General Manager of TriMet, and Michael Allegra of the Utah Transit Authority agreed that they’re “not convinced we should be relying on federal investments for operations.” Their priority was to increase federal participation on the capital side and “leave it to us to maintain safe operations.” Some level of funding for maintaining their systems in a state of good repair, they allowed, was acceptable to them.

Why the fear of federal assistance for operations? They seemed to worry that it could come with micromanagement of day-to-day operations. Still, their unwillingness to fight for flexibility in federal funding is frustrating to riders and advocates who are tired of service cuts.

Avoiding Service Cuts During a Budget Crunch

Meanwhile, Michael Allegra of the UTA says capital expenditures don’t have to eat into operating budgets, even in hard times. The UTA managed to maintain its promised capital expansion projects with less than a five percent reduction in service by spreading cuts out over all parts of the agency. They opened their books to their contractors to have a frank conversation about how to reduce costs on all sides. They’re holding off on expanding service, and even sold off some vehicles they had already bought for future service improvements. Still, ridership is up.

Portland, on the other hand, has been forced to cut service when the state’s 10.6 percent unemployment rate threatened revenues (Oregon doesn’t have a sales tax, so TriMet is funded by payroll taxes.) “Service reductions put the spotlight on us,” said TriMet’s McFarlane. “We found ourselves answering difficult questions, like, ‘How can you build another rail line when you’re cutting service and raising fares?’”

McFarlane vigorously disputed the charge that TriMet allowed light rail to grow at the expense of bus service, which is seen as serving more traditionally underserved people.

He said 76 perent of TriMet’s riders use both modes – bus and rail – and so they see the efficiency of the whole system, not just one mode or another.

  • Larry Littlefield

    Ending maintenance means destroying mass transit later. If I were a cynical politician looking to get rid of mass transit to save money, that’s what I would do — eliminate capital funding to “save the fare.”

  • Jass

    It’s simple.

    Capital expansion means engineering firms, construction firms, lawyers preparing environmental reports etc etc. Basically, it’s a corporate orgy. You can bet that all these corporations, the steel people, the cement people, the unions lobby there ass off to make sure there’s always expansion.

    Operations? That only helps pay bus driver salaries. Who’s going to lobby for that?

  • Thank you, Jass.

  • Andrew

    I cannot believe a true transit advocate will have forgotten the city’s transit system of the 1970’s and 1980’s. The system was decimated – not because of poor operating subsidies, but because the system had fallen into such deep disrepair as to render it unreliable, and, in the worst instances, deadly. There was virtually no capital budget in those days.

    If you look at the MTA’s annual budget today(easily accessible at the mta website), the VAST majority of money goes to pay for operations and other personnel costs, another sizable chunk goes to pay for debt service for capital projects already finished, and a relatively small piece of the pie goes to pay for yet MORE debt to buy new capital projects. If we decide to shift that remaining money over to operating buses that run virtually empty most of the day anyway, than I say we have our priorities totally wrong.

    What we need is enough money for both sides of the budget. There should be no war between the two.

  • Jass

    Andrew, there is a problem with your post. You say:

    “If we decide to shift that remaining money over to operating buses that run virtually empty most of the day anyway, than I say we have our priorities totally wrong.”

    Implying that a mostly empty bus should be cut. But that just starts a death spiral.

    For example:

    Nurse Jenny works from 5pm to 2am. She takes the packed rush hour bus to work, but rides the nearly empty 2am bus hope. If you cut the 2am bus, Jenny can no longer rely on the bus and gets a car. Muni didnt just lose one 2am rider, they lost a 5pm rider as well. (Transit agencies count trips, not riders)

    Part time joe goes to work on a full 8am bus but gets home on an empty 2pm bus. Again, cut the 2pm bus and joe gets a car, and Muni loses two riders.

    Keep adding this together and ridership goes down and down. Suddenly, your rush hour bus is no longer packed, as the only people who can use it are those who happen to work 9-5.

  • Andrew, you don’t need to defer maintenance to question the more than $20 billion budgeted for capital expansion in the region today.

  • Andrew

    Jass: First of all, I certainly don’t want to imply that I think the city doesn’t need comprehensive service. The more trains and buses running the better. Nevertheless, having thumbed through some of the “board material” data on the buses that the mta cut – some would carry as few as SEVEN people per trip, the cost per rider was astronomical – I think you are demonstrating the exception from the rule. The fact is that if you look at the ridership numbers and the routes of the buses, a rational decision given the alternatives is to eliminate those routes. It doesn’t mean I don’t care about the nurse on the bus with seven people, it’s just that the MTA doesn’t have the money.

    Alon: How much do you think is an appropriate level for investment? There has been NO new infrastructure, save completing the 63rd St tunnel in forty years! No new subway lines in, what, fifty years? Sixty years? When do you think is an appropriate time to make this investment. Also, capital dollars are not fungible – they are debt, serviced by funds from various sources. You cannot take that twenty billion or even a fraction of that twenty billion for other needs.

  • The MTA and NJT never even asked for twenty billion dollars for operational improvements, or for maintenance; they went straight for the expansions.

    The appropriate level of construction depends on the cost of digging tunnels. At present-day New York cost, nothing but Second Avenue Subway comes remotely close to cost-effective, and even SAS I have doubts about. At Madrid costs, the equation would change.

  • Thanks for covering this increasingly critical issue.

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