Denver’s Regional Transit District (RTD) says it will have to raise fares and cut service due to higher-than-expected operating costs and lower-than-expected revenues. I am sure this has nothing to do with cost overruns for RTD’s rail lines that are under construction, right? Because operating and construction funds come from two entirely different sources, right?
Well, no, RTD sales tax collections can be spent on either operations or construction. And it is only a coincidence that RTD is thinking of proposing to raise those sales taxes in order to fund those cost overruns.
RTD has plenty of company, as the American Public Transportation Association (APTA) says that transit agencies across the country are raising fares and cutting service. Interesting how every example in this story, from New York to Salt Lake City, is of a transit agency that is struggling to build or maintain an expensive rail system. If they didn’t have to spend hundreds of millions of dollars on trains, they would have plenty of money to operate their buses and wouldn’t have to raise fares and cut service. APTA sort of admits to the connection when it reports that 20 percent of transit agencies say they have not only cut service but delayed new construction due to revenue shortfalls.
The Antiplanner is aware, of course, that the economy (and therefore the tax collections that support transit) is down and fuel prices are up. But recessions are an inevitable part of the business cycle, and just about every transit advocate in the country has been predicting that petroleum prices would go up sooner or later. Why couldn’t the transit planners, who have no hesitation to plan a rail line that requires years to construct and decades to amortize, plan for such inevitable events such as recessions and high gas prices?
The really funny thing is that staid newspapers like the New York Times and Denver Post act like transit is important. Maybe it is in New York City. Everywhere else, including all the cities mentioned in the Times article, not so much.
Transit riders “are often low-wage workers trying to get to their jobs,” says the Times in an effort to generate some sympathy. But they are often well-paid salaried workers trying to get to their jobs too. Also, highway users are also often low-wage workers trying to get to their jobs, but the Times never thought of that when it argued that a stiff federal gas tax is absolutely necessary so transit agencies, which carry 1 percent of passenger travel in the country (and zero percent of freight) can siphon off 20 percent of gas tax collections to fund their boondoggles.
It is time to reform transit so that it can stop lurching from crisis to crisis. Maybe the best way to achieve that reform is for Congress to fail to renew the gas tax, which will put transit agencies in an even bigger bind than ever and force them to consider real solutions, such as contracting out and privatization.