Friday, November 30, 2012

Which Urban Myth Will the Roger Rabbit Sequel Exploit?

Fortunately there is a sequel to "Who Framed Roger Rabbit?" in the works. Since the first movie used Bradford Snell's false and damaging argument that there was a grand conspiracy by General Motors to destroy transit in the United States as a main plot point, let's speculate on better urban frauds the new movie can incorporate into the story.

Perhaps the new movie can have a villain who claims that streetcars cause economic growth, leading to hundreds of millions of dollars of federal subsidies funneled to the villain's business holdings.  Here is a link to some top secret test footage of an early draft.

Here is the key scene from the first movie where the dastardly plan is described:

Bridge Collapse Causes Train Wreck

A train derailed in New Jersey after the bridge it was crossing collapsed. Here is a CNN story. At this point no one knows if the bridge collapse was the cause of the derailment (or was there something with the train that caused the collapse), but will this event serve as a reminder that we tolerate catastrophic failures of our infrastructure far more commonly than most people think? I am not confident that knowledge of potential failure will spur action, nor am I very confident that actual failure will change priorities to fix our infrastructure first. It seems most likely that we will continue to tolerate occasional failure even though everybody knows this is the wrong  way to go about things. Collective action problems are hard.

Thursday, November 29, 2012

Matt Kahn on Project Evaluation

In the above video Matt Kahn explains why many projects that do not pass muster in a benefit cost test still move forward. This NY Times article provides somereal world examples of the politics of rail investment in Los Angeles, especially how rail investment is not equitably spread around. From the Times story, Mayor Villaraigosa explains his support for a new rail line that doesn't stop in an African-American neighborhood:
But Mr. Villaraigosa also emphasized the benefits that the rail network — including a recently constructed light-rail line that carries passengers through the northern parts of South Los Angeles — would offer the area even if a Leimert Park stop was not built. He also noted his efforts to expand the Crenshaw line, which was originally designed as a bus line with a fraction of the money it now has.
“All of that happened because I drove it,” he said. “This was a busway before I made it into a light rail.”
The story does not make clear what the benefits of the rail line are expected to be, but I'm pretty sure that Leimert Park is better off with a busway that stops in the neighborhood than with a light rail line that does not. USC's Lisa Schweitzer explains why the residents of Leimert Park are upset:
“It comes out of this history in which the answer is always no,” she said. “When it comes to requests from South L.A., the answer is always no, we can’t afford it. And, conversely, when it comes to the West Side, the answer is always yes, because they’re so politically empowered and so wealthy.”
Too many transit projects are failures on economic and equity bases. For those of us who support transit, we need to be much more reflective about the investment choices we have made.

The Relative Size of Transit Systems

Twin Cities Metro Transit just celebrated its three billionth rider. Here is a Star Tribune article about this feat. That sounds like a lot of riders, except Metro Transit started counting upon its creation in 1967 1972.* At that time the Twin Cities had about 1.8 million residents. There are now over 3.1 million people.

As a point of contrast (but without making any larger point), three billion riders are about 15 months worth of subway and bus ridership in New York City, not including commuter rail.

*I wrote the wrong year originally. Metro Transit was created in 1967 but started current operations in 1972. It took 12 years for the first billion riders, 15 years for the second billion, and now 13 years for the third billion.

Tuesday, November 20, 2012

Road Deaths Are Up Thanks to the TSA

The Transportation Security Administration (TSA) is a well-meaning but terrible bother for travel. It isn't much more than security theater and is generally an example of lousy governance. See here for a run down of many complaints. There are many more. The TSA is supposed to save lives by making flying safer. But Charles Kenny argues that the TSA is killing more people than it potentially saves since many travelers avoid safe but inconvenient air travel for driving, which is far riskier. He also explains what a waste the program is. About the road deaths:
There is lethal collateral damage associated with all this spending on airline security—namely, the inconvenience of air travel is pushing more people onto the roads. Compare the dangers of air travel to those of driving. To make flying as dangerous as using a car, a four-plane disaster on the scale of 9/11 would have to occur every month, according to analysis published in the American Scientist. Researchers at Cornell University suggest that people switching from air to road transportation in the aftermath of the 9/11 attacks led to an increase of 242 driving fatalities per month—which means that a lot more people died on the roads as an indirect result of 9/11 than died from being on the planes that terrible day. They also suggest that enhanced domestic baggage screening alone reduced passenger volume by about 5 percent in the five years after 9/11, and the substitution of driving for flying by those seeking to avoid security hassles over that period resulted in more than 100 road fatalities.
Just more reason to get rid of the TSA and develop smarter air security.

Monday, November 19, 2012

Let's Make a Deal: Give Poor Households Cars So Rich Households Can Take Transit

The Republican candidates for president this past cycle were widely criticized for taking the stance during the primary debates that no tax increase was acceptable. They all demurred at the offer of a $1 increase in taxes for a $10 decrease in spending. So I want to propose a similar idea to transit advocates. Is a small increase in driving by certain groups worth a large decrease in driving for other groups? Specifically, what if we subsidized car ownership and usage for low income people so that public transit would no longer have any social welfare component? I know this is provocative and I do not advocate for it, but am curious if maximizing the environmental benefits of transit are worth eliminating or dramatically reducing the social welfare benefits of transit. If poor people without cars get cars, based on current land uses, they will be better off in most cases. If we can then focus new transit investment on likely or potential riders who currently drive a lot, we may be able to reduce overall auto usage and reduce transport emissions.

Who will make this deal?

Sunday, November 18, 2012

Are Roads Public Goods?

For many "surface" roads, in rural areas, there is no congestion, or at least none unless you get behind a tractor or school bus. And the cost of collecting fees would be prohibitive, particularly in the era before transponders when you would have need a toll booth at the end of every driveway or building entrance to measure when a car gets on and when it gets off. So, roads in that kind of setting are pretty close to public goods. Further, we can charge an excise tax on gasoline, which is close to being a linear fee on intensity of use. Heavier cars, and trucks, use more gas and so pay higher fees, and even smaller cars use twice as much gas to travel twice as far. So weight and distance travelled determine how much you pay in fees (gas taxes). Let's say rural roads look like they could be public goods.
Rural interstate, or limited access, highways are a closer call. The limited access part means that there are relatively few on/off ramps, and the development of transponders and licese plate cameras with computerized billing reduces the costs of collecting fees. Still, the use of the highway is generally not subject to congestion in rural areas. When Chateau, Angus, and I (once with Fred Flintstone) drove across Kansas (to get to the other side, so we could go skiing in Colorado), we spent long stretches of the night watching headlights coming from far away. Not many other cars out there on I-40 in January at 3 a.m. So, even though it is possible to collect fees, the marginal cost of road use (once the gasoline is taken out, and already taxed) is very close to zero. Probably still a public good, though you could argue the point.
But urban, limited access highways? Please, chile, get out my face. That's NOT a public good, not even close. Urban highways are notoriously subject to extreme crowding. Consequently, the marginal cost of being on the highway is positive. And it is cheap now to use electronic means to detect and collect road use fees. These fees can have different levels for different times of day generally, and even be "live," with different charges for different traffic conditions.
Lots of people have discussed these distinctions elsewhere, but the public/private distinction is often misused where whether or not the roads are publicly or privately supplied often confuses people as to whether the road is a public or private goods. I'll add that is some cases roads can and should be considered club goods or common goods.

Monday, November 12, 2012

Holly Solomon Found the Vote That (Would Have) Mattered

It is extremely unlikely that your vote swayed the outcome of the US presidential election. See Andrew Gelman for details. Holly Solomon believes she found the decisive vote, however, and did something about it: after identifying her husband as the one guy who didn't vote she ran him over! Since Obama was re-elected, Holly thought her family was going to face hardships. She was right! Her family will now face the hardship of her going to jail.

Saturday, November 10, 2012

Can Social Impact Bonds Be a Model for Transport Finance?

The Canadian government just announced social impact bonds to supply public services. From the Toronto Star:

OTTAWA—The Harper government is introducing a controversial new approach to funding social services called “social impact bonds” that can turn a profit for private investors. 
“Social finance is about mobilizing private capital to achieve social goals, creating opportunities for investors to finance projects that benefit Canadians and realize financial gains,” the government said in a statement announcing the financing mechanism.
Human Resources Minister Diane Finley commented, “The government recognizes that we must take steps to enable communities to tackle local challenges. 
“By harnessing private sector capital and business practices, we can better respond to social challenges such as homelessness, unemployment and poverty,” she said in a speech in Toronto explaining the initiative. 
The bonds, which were mentioned in the March 29 federal budget, are a complex mechanism to increase funding for social objectives.
The government contracts with a non-profit organization or a private, for-profit business to supply a service, such as building affordable housing, counseling ex-convicts or working with at-risk youth. Funds are raised from investors or charities to finance the project and, if the goals of the project are reached, the investors are repaid their original investment plus a profitable return.
“The government will partner with organizations, businesses, and not-for-profit organizations to build further momentum in Canada around social innovation and social finance tools,” the Human Resources department said in a background document.
The bonds, pioneered in Britain, have been widely questioned by critics. They say the bonds are a way of getting governments and the public off the hook for paying for needed social programs and question how success or failure of the projects can be accurately measured.

A key question associated with these types of bonds is whether the public should provide direct investment in places and things that should positively affect citizens, or should the public invest in people and leave other businesses and agencies to worry about supplying things.

I think we should try more people based policies, and transportation is ripe for such efforts. I have argued for mobility credits as a way to improve transport finance and improve social equity (see here or here). You can find a bit more background on mobility credits at the Transport Economics wikibook (links available at the site):

Tradable mobility creditsA more acceptable policy on automobile travel restrictions, proposed by transport economists[25] to avoid inequality and revenue allocation issues, is to implement a rationingof peak period travel but through revenue-neutral credit-based congestion pricing. This concept is similar to the existing system of emissions trading of carbon credits, proposed by the Kyoto Protocol to curb greenhouse emissions. Metropolitan area or city residents, or the taxpayers, will have the option to use the local government-issued mobility rights or congestion credits for themselves, or to trade or sell them to anyone willing to continue traveling by automobile beyond the personal quota. This trading system will allow direct benefits to be accrued by those users shifting to public transportation or by those reducing their peak-hour travel rather than the government.[26][27]
In short, social bonds should be encouraged as a way to increase competition and accountability while ensuring desired services. Such bonds are great opportunities for policy experimentation and improvement.

Friday, November 9, 2012

Transit Referendums Have Always Been Popular

Source: The Onion

There were lots of transit and transport related referendums on ballots this year, and about 80 % of them passed. This is essentially par for the course for these types of measures, and nothing to get excited about as some type of shift in priorities or sentiment by the public. The past few years have seen similar rates of passage for transit and transport projects (see here), and these measures generally have broad support across the electorate. See this recent report from NRDC for a snapshot of current support across party lines, which has been fairly steady over time, and see The Onion piece above for a 12 year old joke about how popular transit is. While many vote to support transit, most vote to support transit for someone else.

Where officials seem to be cannier in their approach is they realized that bond measures are more popular than tax measures. Here is the abstract from a paper by Dixit, et al.,:
Transit is an integral part of a sustainable transportation system in any
region. Proposals for transit initiatives that are brought to referenda
include a funding vehicle, either tax based or bond based. A tax-funded
proposal imposes the cost on the present generation of residents, whereas
a bond-funded proposal delays the burden to future generations. The aim
is to investigate whether the success of proposals in referenda is related
to the use of taxes or bonds for funding. This question is investigated
with the use of data from 111 transit referenda held in the United States
from 1999 to 2007. It was found that proposals that use taxes for funding
are less likely to pass than those that use bonds.
In broad terms, transit ballot measures are popular because other people using transit will help make driving easier--e.g. people support transit as a form of congestion reduction as they expect their personal harm from congestion will decline after other people switch modes--and future generations will pay for the improvements. Such a deal.

Pushing costs onto future generations is nothing new. For instance, New York's Metropolitan Transportation Authority has long pursued a bond strategy driven largely by public demand for services now and repayment later. See this paper by James Cohen for details or this working paper of mine here.

Thursday, November 8, 2012

The Role of Parking in Successful Urban Centers: New Report from London

London Council commissioned a report on the role parking plays in ongoing success of urban centers. Here is a link to the report. Here are the findings:

The review of the academic literature and other reports showed that there was relatively little research carried out into the link between parking and urban centre success. Where there was research, it was often not backed up by survey data or other robust evidence.
However, where there was research, the main findings were as follows:
1) More parking does not necessarily mean greater commercial success. A well managed parking scheme, where spaces ‘turn over’ frequently can help to increase the number of visitors coming to a town centre and thereby help business.
2) There is no such thing as ‘free’ parking. The costs of developing and maintaining parking
spaces and then enforcing proper use to ensure good traffic flow have to be borne by
somebody. In the case of local authority operated parking (on street or off street) any costs
that are not covered by parking revenue falls to local Council Tax payers.
3) Shopkeepers consistently overestimate the share of their customers coming by car. In
some cases, this is by a factor of as much as 400%. In London, as well as other cities, the
share of those accessing urban centres on foot or by public transport is much greater. Walking
is the most important mode for accessing local town centres; public transport is the most
important mode for travel to international centres, such as Oxford Street.
4) Car drivers spend more on a single trip; walkers and bus users spend more over a
week or a month. In 2011, in London town centres, walkers spent £147 more per month than
those travelling by car. Compared with 2004, spending by public transport users and walkers
has risen; spending by car users and cyclists has decreased.
5) A good mix of shops and services and a quality environment are some of the most
important factors in attracting visitors to town centres. If both these are poor, then
changes to parking or accessibility are very unlikely to make a town centre more attractive.
6) There is very little evidence of the impacts of parking on the night time economy. This is
an area that needs more research.
7) Boroughs collect a lot of data on parking but there is less information available on town
centre economic factors. Finding ways to coordinate data collection across departments
could be helpful to monitor the impacts of parking policies.
I haven't read the whole thing closely but it looks like a nice review of the state of the literature with some new survey data to support their assertions.

More on Credible Commitment and Transit Investment

I recently highlighted credible commitment as a factor that influences political support and coalitions for transit investment. In Los Angeles Measure J failed by a small margin in part because groups who should be natural allies of the MTA did not find the agency a credible recipient of dedicated sales tax revenue through 2069. Independent of the merits of any investment priorities, transport agencies need to be much more aware of how trustworthy they are in the public view in large part because of the changing structure of transport finance.

Federal funding is declining as a share of overall transport investment. As a response, local, regional and state actors have to take a larger role in taxing and spending for transport, as well as assessing priorities for investment. Voters are not likely to support new taxes, road fees, transit fares and other revenues if they think their money will be spent foolishly or dishonestly. For instance, in the New York region the Port Authority of New York and New Jersey damaged it's reputation after raising tolls on their Hudson River crossings in 2011. The dramatic increase in tolls was widely perceived to be needed for reconstruction of the World Trade Center site, and AAA filed a lawsuit on these grounds. Here is more from the Wall Street Journal with some details that the WTC site is diverting money away from existing infrastructure. Overall, the actions of the Port Authority will make it more difficult to raise revenues for required maintenance and new investment in the future regardless of the merit of the WTC project. Also in New York, the MTA is still negatively affected by the myth that they used to keep two sets of books. There never was a second set, but the MTA is less credible because of the perception and has trouble gaining political support at the state capital. I wrote about credible commitment and the MTA last year here and also highlighted distrust toward the Twin Cities Metropolitan Council because of investment choices the agency made.

So when I read stories such as this one from San Antonio, where the transit agency is swapping money with the highway department to avoid a lawsuit about improper use of sales tax revenues, I worry that the agencies involved are causing long term harm for short term gains. From the San Antonio story:
In a funding swap, $92 million in state money previously set aside to add nontoll lanes on U.S. 281 and Loop 1604 would replace local money reserved for the streetcar project.
In turn, the local money assigned to streetcars would go to adding the nontoll lanes.
The local money comes from the Advanced Transportation District, funded by a 1/4-cent sales tax approved by voters. The state money is from the Texas Mobility Fund.
The Texas Transportation Commission, which governs the Department of Transportation, is expected to vote Nov. 15 on shifting the state money.
Whether the new funding plan will crush any potential court challenge to streetcars remains to be seen.
Jeff Judson, a staunch opponent of rail and the use of ATD funds for streetcars, questioned the legality of spending TMF funds instead.
“I just don't think TxDOT should be accommodating the expenditure on transit, when it's just not their role, and transit will do nothing to reduce congestion,” said Judson, director of the Heartland Institute, a free-market advocacy group.
TxDOT Executive Director Phil Wilson said the agency's proposal to assist with the streetcar funding reflects its increased focus on partnerships.
“We want to find the best opportunity to take dollars and extend them as far as we possibly can,” Wilson said, adding that TMF money is among “the most flexible of funding sources the state has.”
Bexar County, VIA and the city voted last fall to fund the 5-mile streetcar system along with park-and-ride and transit centers.
But the streetcars — the centerpiece of the plan — generated the most controversy.
ATD money was just one of the funding sources, but streetcar opponents, including several Republican elected officials, said it could not be spent for streetcars because voters were promised it wouldn't go to light rail when they approved the sales tax in 2004. Streetcars and light rail, opponents contend, are the same thing.
Longtime rail advocate Judge Nelson Wolff disputes the similarity and believes officials were in the right to use the ATD money. But he didn't want to risk a lawsuit that could delay streetcar construction.
Again, my point is not about the relative merits of streetcars or light rail or roads or park and rides. Rather, the convoluted process of swapping money to achieve a desired result is problematic. In this case, streetcar investment. I will note that the most likely reason that the voters were not asked about streetcars on the 2004 ballot is that at that time the federal government didn't provide funding for streetcars. A change in how projects are evaluated put in place during the Obama administration opened the door for lots of streetcar projects. Cities had no idea what they were missing until the feds starting picking up the tab. Back to my point, as transit agencies become more responsible for raising money and prioritizing investments they have to become more accountable for those decisions, and they must act is ways that enhance credibility rather than reduce it.  Money swaps, poor investment decisions and other actions are problematic for good long term governance of transport investment.

Tuesday, November 6, 2012

Are Transit Agencies Credible?

Transportation finance is politically challenging in the best of times. These are not those times. In the New York region, the New York MTA has responded admirably to the damage caused by Hurricane Sandy. Will their efforts and effectiveness in restoring most service in the aftermath help the credibility of the authority with the public and elected officials? We'll see. What about New Jersey Transit, which is also working hard but has not had the same success restoring service?

Credibility matters for agencies more than generally thought. Mike Manville and I wrote a paper about credible commitment as a barrier to congestion pricing, where we argue that agencies that are not viewed as credible have particular challenges with politically difficult policies. In Los Angeles, credible commitment is a major issue facing the ballot Measure J to extend a dedicated sales tax 30 years to pay for transit improvements. Specifically, LA bus riders, who are the overwhelming majority of transit users, don't think the new revenue will be spent on improving bus service. Rather, they think that the LA MTA will spend the new money on expensive rail projects. From the LA Weekly story:
"The potentially devastating impacts of Measure J -- combined with the MTA's record of shamelessly ignoring the needs and concerns of working class Latinos and blacks as it advances a corporate-driven agenda -- has moved leaders of major churches to speak out," said the Bus Riders Union in a press release.
The Measure's supporters don't understand the opposition:
Denny Zane, a leading advocate for the 2008 countywide sales tax hike approved by voters -- and a key force behind this proposed 30-year extension of that tax hike just four years later, finds the Bus Riders Union's position galling.
Zane says that both Measure R from 2008 and the proposed Measure J on the November 6, 2012 ballot send 20 percent of the tax hike into the bus system.
"All around the country, bus systems had major dramatic cutbacks," Zane says. 
 To which the Bus Rider's Union responds:
But Measure J opponents point out that to the millions of bus riders, 20 percent of this latest tax hike is chicken feed.The vast majority of the millions of mass transit users in Los Angeles and its suburbs use the bus -- not the subways and light rail. But, they note, under Measure J, the subways and rail get the lion's share of this proposed sales tax hike to 2069.
There are good reasons to be skeptical of the LA plan. Here is a overview of service and investment since the sales tax measure first passed in 2008:
Since 2009 the MTA has added eight miles of train service, at a capital cost of about $2 billion. These new trains, the Expo Line and an extension of the east-county Gold Line, carry a total of about 39,000 people a day.

In the meantime, the cash-strapped authority radically reduced bus service twice: It cut bus lines by 4 percent in 2010 and 12 percent in 2011. These cuts were made even though buses move more than four times as many Angelenos as trains do.
 Bus riders in Los Angeles have a long history of feeling like they are not a priority. They have genuine reasons to oppose Measure J. The MTA also needs to recognize that they have credibility problems that they have to address. Is the MTA credible enough to trust with dedicated sales tax revenue until 2069? That's a lot of required trust. Damien Goodmon of the Crenshaw Subway Coalition has an answer:
"Can you trust these guys with that much money?" asks Damien Goodmon of the Crenshaw Subway Coalition. "Hell, no!"
And he likes transit spending:
Goodmon favors transit spending but hates the way Metro has gone about it. He's pissed off about the gobs of money being lavished on the Purple Line Westside Extension, which will run under Wilshire Boulevard.
The $6.3 billion to $9 billion Westside Extension will suck up a hefty chunk of the sales tax collected from consumers countywide, yet it falls miles short of the "subway to the sea" once promised, and it won't be completed until 2035.
Meanwhile, the planned Crenshaw Line in South L.A., serving mostly black and Latino riders, will be built on the cheap, at ground level. Goodmon has pleaded with Metro to address safety concerns at points where the line will intersect with streets.
Other black leaders were outraged when Metro's board chose not to build a Crenshaw Line transit stop at Leimert Park, which, in the eyes of many, is the business and shopping heart of black Los Angeles.
Goodmon says the Metro board's unfairly tilted votes on where to spend Measure R taxes amount to "basic economics: We're getting jacked."
Getting jacked, indeed. It is possible and reasonable to support transit investment and oppose Measure J (or any other similar measure). The agencies responsible for collecting and spending the money must be credible. It is not clear that this is the case in LA.

Sunday, November 4, 2012

Streetcars as Economic Development Tool in Milwaukee

The Mayor of Milwaukee wants to build a $65 million two-mile streetcar system according to this LA Times article. From the story:

Mayor Tom Barrett is the prime mover behind Milwaukee's plan to build a brand-new streetcar system. Bright, modern vehicles would traverse a two-mile route through the city's east side, downtown and historic Third Ward, a former warehouse area now popular for its shops and restaurants.
Barrett, who believes flashy streetcars can revitalize Milwaukee's city front, points to the popularity of the 10-year-old system in Portland, Ore. Today's streetcars, Barrett says, are more about attracting attention than providing transportation.
"I look at this as an economic development tool," Barrett said. "Look at Portland. That system has aided in spurring development and growth, which is what all communities are looking for now."
This attitude is the wrong way to think about transport investment. Transport investment should be about moving people and things, not indirect attempts at industrial, labor or development policy. Contrary to the Mayor's claims, there isn't any evidence that streetcars boost local economies, including in Portland. There may be some redistributive effects as certain types of firms spatially sort and other go out of business during construction, but overall the effect is pretty much zero. Milwaukee has wide roads and lots of parking. Lack of transport access isn't the main problem for economic development there.

Saturday, November 3, 2012

New Jersey Rationed Gas So No One Can Buy Any

From the NYTimes Hurricane Sandy feed is a story about New Jersey rationing gas by license plate numbers:

The order reads: “If your vehicle’s license plate ends in a letter (A,B,C…), you are only permitted to fuel the vehicle on odd-numbered days.” Numbers are allowed on even-numbered days.
The problem: All license plates in New Jersey end in letters, except for vanity plates. So on Saturday, most everyone in the state could buy gas. On Sunday, no one can. Or so it seems.