Los Angeles Propositions A & C Update
MTA/SCRTD Spends $2.6 Billion
More than Necessary: 1982-1996

Costs Rise After Proposition A Implementation
Los Angeles public transport costs have escalated since implementation of Proposition A at the beginning of fiscal year 1983. Proposition A provided sales tax funding for expansion of transit service. A similar ballot initiative, Proposition C, was passed in 1991. The extent of escalation is illustrated by comparing unit costs to those of San Diego's Metropolitan Transit Development Board (MTDB).

Competitive Tendering Drops San Diego Costs
San Diego's cost performance is attributable to conversion of 40 percent of its service to competitive tendering, and the competitive ("ripple") effect on remaining non-competitive services. There has been only negligible competitive tendering of Los Angeles (SCRTD/LACMTA) bus services. Unlike Los Angeles policy is separated from operations in San Diego.

LA Costs $2.6 Billion More than Necessary
If Los Angeles costs per mile had declined at the San Diego rate, $2.6 billion less would have been spent to produce the same bus service level.

LA Excess Spending 96% of Fares
The Los Angeles excess spending in 1997 relative to the San Diego trend --- $210 million --- is equal to 96.2 percent of the total fare income from on both bus and rail services.

Ridership Little Changed Since Before Proposition A
The Proposition A dedicated public transport tax was imposed at the beginning of fiscal year 1983. For the first three years the tax financed a reduced $0.50 fare. By the end of the reduced fare program, ridership increased 40 percent, from 354 million to 497 million. Ridership has sinced dropped 22 percent, to 386 million, despite the opening of three new rail lines. Ridership is up nine percent from the pre-Proposition A level, while local subsidies to transit have increased nearly $850 million annually.

Comparison of San Diego &
Los Angeles Bus Costs Since Imposition of Proposition A
(1995$ Based upon Individual Metroplitan Price Indices)

Year

San Diego Los Angeles Los Angeles Operating Costs (000,000) Excess Spending
(000,000)
1982 0.0% 0.0% $581.5 $0.0
Los Angeles Proposition A Tax Increase Effective in 1983
1983 -1.2% 7.9% $618.2 $52.3
1984 -5.4% 8.3% $639.6 $80.5
1985 -6.2% 13.4% $668.0 $115.6
1986 -5.9% 16.5% $684.3 $131.7
1987 -11.0% 8.7% $652.0 $117.9
1988 -15.4% 7.2% $645.5 $136.2
1989 -20.1% 15.4% $649.6 $200.0
1990 -20.1% 18.5% $651.3 $212.5
1991 -18.0% 16.1% $648.0 $190.3
1992 -24.5% 21.9% $652.8 $248.6
1993 -20.8% 23.4% $633.9 $227.1
1994 -20.5% 26.5% $664.7 $246.9
1995 -20.5% 18.4% $581.9 $191.0
1996 -22.2% 27.9% $625.0 $244.7
1997 -20.2% 20.9% $617.9 $210.2
Total --- ---
$10,214.1
$2,605.5
Exhibit: LA Bus & Rail Fares (Millions): 1997
$218.4
Exhibit: Fares/Excess Spending
96.2%
Calculated from National Transit Database and San Diego Metropolitan Transit Development Board Data

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