Tuesday, September 16, 2008

Rethinking transit investment: buses and fees in lieu of parking requirements

The NY Times has a story about the Rochester transit system. The system is noteworthy because it is runs a financial surplus and recently was able to lower fares. From the story it seems there are a couple of important policies lessons to learn. One thing to keep in mind from this example is that referring to the system as profitable is not accurate. There are plenty of state and federal subsidies going into the coffers, but the agency seems to be well run.

A notable lesson here is that transit use is up and fares are down with a bus only system. I doubt that the agency would be in surplus if they invested in light rail. Rather they seem to be investing in technologies that improve service for everyone on the system (satellite routing, for instance). There are very few cities where rail systems make financial sense, and rail investment diverts money from the core mission of providing mobility and access.

The second thing that is important is that local businesses invest directly in transit service. I'm not sure if they can invest in lieu of parking requirements, but this shift has the potential to dramatically improve transit service and the built environment. For instance, there is an apartment building owner mentioned in the story who pays $1,200 per year to get bus service to his building. Compare that outlay with the cost of supplying parking spaces for his tenants. Even if a parking space cost $10,000 to build (a very low estimate), a mid-sized lot might cost a couple hundred thousand dollars. It seems if building owners and developers were able to make in lieu payments to the local transit agencies instead of building expensive parking structures they would all do it is a heartbeat. This would lead to more transit oriented development and less hidden subsidy for cars.
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