The Public Purpose of
Urban Transport

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Any complete public policy discussion should start with the fundamentals --- the public purpose of the public service under consideration. The public purpose of public transit --- the reason that public subsidies are granted to public transit --- is to serve customers --- the riders and the taxpayers. Public transit is subsidized because of the benefits that it is capable of producing, which are expressed in three public purposes:

Mobility for those without access to automobiles (the transit dependent).

Mobility for those who can be attracted from their automobiles (the discretionary market).

The accomplishment of the first two public purposes by utilizing the fare and subsidy revenues to produce the highest levels of transit ridership. Transit service, like any other public service, should be produced for costs that are no higher than necessary (market determined).

While it is true that transit has the potential to improve the urban environment, is it even more certain that contemporary American transit policies cannot deliver on the potential.

Excessive operating costs: With few exceptions, most, if not all of transit subsidies established over the last 30 years have been consumed by inordinate unit cost escalation. Overall, less than $0.25 of each new operating dollar has been used to produce new service. This is a deplorable productivity record --- by far the worst of any transportation industry in the nation. This has consumed resources that should have been used to expand transit service to better serve customers and the community.

Excessive capital costs: Capital funding has been little more effective. Transit has typically over-invested in "Cadillac" facilities and a few corridors, the result of which has been little if any incremental benefit to customers and the community. Overly costly garages and maintenance facilities preclude improvements that would better meed customers needs. Overly intensive rail corridor investments preclude the more financially modest, but more effective investments that could improve transit in many corridors, not just one. More prudent use of capital funding would have made higher levels of service possible, along with higher levels of ridership.

THE SITUATION: TRANSIT IN AMERICA

It is thus no surprise that transit is in steep decline.

Since public subsidies began on a large scale in the 1960s, the percentage of people using transit for the work trip --- the "bread and butter" of transit --- has declined by 60 percent.

Work trip market share declined during the 1980s in 36 metropolitan areas with more than one million population, increased in only two, and was stable in one.

The decline has quickened in the 1990s, with a 10 percent drop in per capita ridership in just four years.

The United States has a large budget deficit, and a national debt of $50,000 per household, which and is increasing by $2,500 per year.

It is not easy to raise taxes, and it is better to not raise taxes than to raise taxes. Why? Because all public revenues are generated by the private sector, and higher taxes limit economic growth and the ability of the private sector to finance the public sector.

There is more to public services than transit. There is increasing competition for scarce public funding, as existing services require more funding and new public service needs are identified.

Sanctions under the Clean Air Act for failure to achieve air quality objectives can seriously harm a metroplitan economy. Continued transit over-capitalization will consume resources that could provide material air quality improvements, increasing the likelihood of sanctions.

THE PUBLIC PURPOSE: CUSTOMERS

What is required is no less than a resolute determination to serve customers, the riders and taxpayers. Customers must be served before managers; before employees; before developers and elected officials; and before interests that would profit by producing unnecessarily costly infrastructure.

Existing and potential transit riders have simple desires. They are summarized in three service characteristics:

Proximity. service that is conveniently close to both their trip origin and destination.

Frequency of Service: the ability to travel whenever they like. That means that service must be frequent, and it must be available virtually all day.

Speed: the ability to travel where they are going as quickly as possible.