What’s the Point of Transit Subsidies?

Rather than figure out how they can best serve the public in a post-COVID world, many transit agencies have not yet “grasped the significance of the challenges facing public transportation and many have focused attention on asking for federal resources to ‘carry them through’ the impacts of COVID-19,” writes transit expert Steven Polzin in a report released yesterday by the Reason Foundation. “Others are busy redefining the performance metrics and expectations of public transportation to justify unconditional federal funding,” he adds in the report, Public Transportation Must Change after COVID-19.

For example, he cites Bloomberg CityLab writer David Zipper, who says that since transit ridership is likely to remain low for years, “public transportation leaders should focus on a different metric for usefulness: transit access.” In other words, transit agencies should ask funders to accept the performance standards that make transit look good, not the standards that actually make sense.

Polzin is not as negative about transit as the Antiplanner. “The core goals of public transportation — providing mobility particularly for those without alternative means and capturing the economy of mass movement of people in markets where those conditions exist — remain important,” he argues. But do they? With transit costing five times as much, per passenger mile, as auto driving before the pandemic, it certainly hasn’t captured any economies of mass movement.

Nor is it doing much to provide mobility for those without alternative means. For one thing, there aren’t many such people left — more than 95 percent of working Americans have access to a car and less than 5 percent of people in all income brackets relied on transit to get to work before the pandemic. With so few truly transit-dependent people left, many transit agencies have focused on attracting so-called transit choice riders — people who can drive but will take transit if given a cushy, highly subsidized ride that happens to go where they want to go.

Before the pandemic, transit riders filled only a quarter of bus seats and a third of rail seats. After the pandemic, it will probably be less, especially if transit agencies continue to get subsidized according to the amount of service they provide rather than the amount of riders they attract. It doesn’t make sense to subsidize high-income riders, especially if we could save energy and reduce greenhouse gas emissions by getting those riders to drive fuel-efficient cars instead.

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Polzin understands this. “Underused transit vehicles do not fight climate change and exorbitantly expensive transit trips are not a prudent way to spend public resources,” he admits. But transit was already costing taxpayers almost $6 per ride before the pandemic. At what point does the cost become exorbitant?

While I like what Polzin is saying, I’m not sure he knows who is audience should be. He seems to be encouraging transit agencies to freshen their strategies. But he forgets that those agencies are much more responsive to appropriators than to transit riders.

Transit agencies “have historically been content to use 30-year planning horizons for transit capital investment planning that were driven by often 10-year-old travel behavior models and data,” he says. But the reason why they were content with that is because that is what the federal government required for them to get big grants for transit projects. Getting the grants was more important than getting transit riders, who after all cost the agencies more than they were paying in fares anyway.

In other words, transit won’t change until Congress changes how it funds transit. If Congress is happy to hand money over to transit agencies for running empty buses and trains, then they will run empty buses and trains. So far, it doesn’t look like Congress will ask for anything else.

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About The Antiplanner

The Antiplanner is a forester and economist with more than fifty years of experience critiquing government land-use and transportation plans.

2 Responses to What’s the Point of Transit Subsidies?

  1. Henry Porter says:

    When poor people can’t afford to buy groceries, we give them coupons and send them to a grocery store. We don’t build a completely new grocery store for poor people, then hope well-off people are attracted to it, too.

    But when poor people can’t afford cars, we build them a separate transportation system that’s more expensive to run, burns more fuel, generates more pollution and offers poorer service than the one they can’t afford. Then we overlook and/or deny the flaws and subsidize it forever.

    Why don’t we subsidize the passengers instead of the transit bureaucracy? Suppose we gave poor people vouchers, in proportion to their need, entitling them to “spend” their vouchers on whatever mode of transportation makes sense for them?

  2. LazyReader says:

    When a city is at the precipice of financial turmoil or fiscal oblivion, their first instinct for survival is scrape together cash; Cash they desperately need to satiate the populace that work in their candor (The Public workforce that contributed so much to their elected campaigns) and the people whose electoral loyalty is bought and paid for solely with entitlement spending “MAH OBAMA PHONE”
    Anyway, when a city is orbiting the financial black hole they go thru several stages.

    Stage 1: Accumulation: SO what you see is what I call the “Fee, Fine and Taxation Era” of urban evolution. Things you never saw before. Fines for mundane crimes shoot up 10-20 times their original cost (AND THAT ASSUMING they have interest in enforcing it or target specific people who’re harmless but pockets full to shake). Fee’s for things that were largely free crop up (Parking, etc). And taxes on new behaviors and consumer goods (Vaping, plastic bags, soda) begin to creep into legislation discussions. For example an illegal alien dumping hazardous waste in a creek, is a losing issue, gotta pay for translator, court, arrest, clean up. But a yuppie with a cell phone, while driving and didn’t signal his turn…….is a money making opportunity.

    Stage 2: Desperation: They start the above mentioned scenarios with even greater gusto and bravado. They Often hire MORE public employees anyway. At this stage media gets wind and often discusses or blames higher up leaders (state, federal) for not helping?

    Stage 3: Advertising: The city leaders will spend more public funds on attempts to attract odd, amusing or financially appealing events or attractions. These often again come at huge public expense. Sports, the Olympics bid, convention centers, etc.
    Portland- Lightrail
    Baltimore- Inner harbor refurbishing
    Chicago- Millennium park
    Almost every city tries it by trying to Attract a sports team and building a stadium. The media lapdogs also jump to the defense to attribute blame for the financial crisis; Often on their ideological opponents.

    Stage 4: Cuts/Propaganda/Budget increase: Where possible if the financial receipts continue to decline, cuts to the budget are often made, albeit they are minute or non sequential. Usually they justify all the other expenditures they made before thru clever words. Then the budget increases anyway. And is often financed thru the most horrible method, Burrowing.

    Stage 5: Sayonara/Flight: Finally sick of the deteriorating services, lapse policing or public outcry for……….some random event that’s blown out of proportion. In the end, depopulation from productive citizens is usually accompanied by massive protests or some sort of public scrutiny. At this stage the city planners often beg the state for money to pay the bills.

    Stage 6: Meltdown

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