Transportation blogger Jim Bacon attended the American Dream conference and has a few words to say about Dale Moser’s presentation about Megabus. Bacon also comments on the debate that took place Sunday night over the proposition that Congress should abolish New Starts and distribute the same amount of money using a formula based on transit ridership or fares.
This debate was supposed to be about the ethics of Congress giving transit agencies incentives to choose high-cost transit systems when lower-cost systems would work just as well. But it descended into a debate over rail transit. I argued that, with a formula fund, transit agencies would be free to spend their share of the formula on rail transit if they wished, but would not be rewarded for choosing rail over less-expensive buses.
My opponent, Art Guzzetti, of the American Public Transportation Association, argued that capital projects can’t be built with formula funds; they require dedicated funds. I responded that all federal highway funds are formula funds and have been used on such capital projects as the Interstate Highway System. The difference is that the Interstate Highway System was built with user fees in the form of gas taxes, and only built at the pace that gas tax revenues allowed, while transit agencies want to build expensive rail lines regardless of the fact that user fees will not pay for the capital, maintenance, or even much of the operating costs.
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