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.

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?

Are Street Parking Fines Inequitable?

A group of renters are protesting proposed increases for Los Angeles's street parking tickets. From the LA Times:

Renters' rights activists are taking aim at Los Angeles Mayor Antonio Villaraigosa's plan to increase parking tickets by $10 -- the sixth increase in seven years at City Hall.
Advocates for working-class families said they intend to speak out on the proposal Tuesday afternoon at the City Council's Budget and Finance Committee, which is set to consider possible changes to Villaraigosa's proposed budget. The city faces a $238-million shortfall.
Those activists are taking special aim at the proposal to charge $78 for parking violations on street-sweeping day, saying it unfairly hits those who live in high-density neighborhoods where spaces are scarce.

This is not a new argument. Here is a description of the effects of Santa Barbara trying to improve street sweeping a few years ago:

On Tuesday, when the City Council heard a status report on the street-sweeping program, the members generally praised the progress. But Council members Grant House and Helene Schneider touched on some issues of equity.
One is how the program, bankrolled mostly by parking tickets, seems to be subsidized by the poor. Parking tickets generate almost a cool $1 million every year — that’s three-quarters of the street-sweeping program’s annual budget of $1.3 million. (The rest comes from ballot measures B and D, for creeks and transportation, respectively.)  Meanwhile, Santa Barbara’s most heavily ticketed area is the Westside, one of its poorest neighborhoods.
“That means you’re really applying two kinds of standards,” House said. “There should be an equal treatment of the different neighborhoods.”

The reason the Westside is ticketed more is because there are more people per unit are fewer off street spaces, plus the free on street parking is used by downtown workers. So what is the treatment here? Clean streets or parking citations? Is it inequitable to charge people for parking (see this Cal State student resolution arguing that it is unfair for students to pay as much as everyone else)? Lots of people seem to think that anything other than cheap or free parking for all is socially undesirable regardless of the broader costs. Will the Bus Riders Union inspire a Street Parkers Union?

Equitable Transit

The Los Angeles County Metropolitan Transportation Authority is is trouble with the U.S. Government (again) for non-compliance with FTA civil rights requirements. Here is an LA Times story about this. Here is some background on the lawsuit brought by the Bus Riders Union against LACMTA in 1996 that led to the consent decree. The MTA was accused of reducing bus services and foregoing transit improvements in low income, transit dependent areas while investing in and expanding rail services to attract wealthy ridership. Such actions violate Title VI of the 1964 Civil Rights Act by "establishing a discriminatory, separate, and unequal transportation system while using federal funds."

Cutting bus services is common by U.S. transit systems as operations have annual budget deficits. (This isn't just an LA story. Here are Portland's upcoming bus service reductions and fare increases. Free rail fares downtown will be eliminated. Here is a story about how Portland relies on federal funding for their light rail expansion. Here is a story about the concrete being poured as part of the $700 million new light rail line.) However, in systems that have added rail services over the past few decades the rail deficits have made the operating budgets worse. To compensate for the costs of operating new lines, bus lines are reduced or eliminated. Since buses tend to have lower income riders than new rail lines (this is by design as new rail lines are usually built to attract high income "choice" riders rather than serve transit dependent riders. See this paper by Mark Garrett and Brian Taylor for details.) cutting bus services while maintaining rail services causes disproportionate harm to lower income riders. Bus riders are also more likely to be minority or immigrant populations.

Transit capital investment choices over the past four decades have been primarily focused on getting drivers out their cars rather than improving service for those who rely on the transit systems. This strategy has not been very effective. There are some new riders, but the dollars spent per rider gained is enormous. Clifford Winston argues that all new rail transit systems in the U.S. actually reduce social welfare. Martin Wachs details how subsidies have changed the incentives of transit providers without improving service. Daniel Hess and Peter Lombardi explain how metropolitan regions have adapted to various funding schemes for transit in a 2005 paper. These papers, and many others, point to the myriad problems of paying for transit service.

Robert Bullard, the leading environmental justice scholar, explains transportation justice like this:

“Follow the transportation dollars and one can tell who is important and who is not. While many barriers to equitable transportation for low-income and people of color have been removed, much more needs to be done. Transportation spending programs do not benefit all populations equally. The lion's share of transportation dollars is spent on roads, while urban transit systems are often left in disrepair. Nationally, 80 percent of all surface transportation funds is earmarked for highways. Generally, states spend less than 20 percent of federal transportation funding on transit.... In the real world, all transit is not created equal. In general, most transit systems tend to take their low-income ‘captive riders’ for granted and concentrate their fare and service policies on attracting middle class and affluent riders. Hence, transit subsidies disproportionately favor suburban transit and expensive new commuter bus and rail lines that serve wealthier ‘discretionary riders.’“

All of this research and analysis suggests a few things. First, we should be far more open to new ideas of transit service and finance. The current public monopoly model can be improved (there are many ways to do this, not all of which will be successful in all situations.). Second, we should focus more on providing high quality service where there is existing demand  rather than new construction that is speculative in terms of ridership. Third, keep in mind that operations for nearly all transit lines in the US are subsidized, and all new rail lines are. If the transit network is expanded, that means that the amount of subsidy needed for operations must be increased. Transit network expansion makes the operating budgets of transit agencies worse, not better, to which it follows that future service reductions or other new revenues are part of the agreement for new investment now.

The service reductions that accompany rail expansion too often come at the expense of those who rely on bus services and have no alternatives. This is what keeps getting the LACMTA in trouble, and I expect that similar lawsuits will pop up elsewhere. The capital investments we make (and how we finance them) have strong bearing on equitable transit services. How to address equity and what is perceived as fair are difficult issues that are not easily solved, but we currently don't spend enough effort in transit planning and policy working through these concerns.

Geographic Equity and Road Tolls

Equity concerns are a major source of trouble for implementing road tolling programs. (Here are two things I have written about equity and the politics of tolls: "For Whom the Roads Tolls" and "Remediating Inequity in Transportation Finance".) This is from my paper for the TRB Committee on Equity:

Policymakers are strongly considering new tolls and fees to manage congestion, provide environmental benefits, and raise money for transportation investment and maintenance.Understandably, such a shift in the way transportation is financed raises concerns about equity. In the United States driving is so ubiquitous that any efforts to raise the marginal costs of driving will have implications across a broad swath of the population, including raising the cost of travel for many people who are poor and have no alternatives. Understanding how existing transportation financing schemes compensate for inequities is critical for developing policies that will ensure fairness in the future. To this end this essay explores how inequity is remediated through revenue recycling and dedicated programs using transportation finance.

 Concern over inequities and fairness is as old as toll roads.  The early toll roads in the United States frequently exempted farmers and folks going to church from paying tolls due to such complaints (1).  More recent supporters of congestion pricing are concerned with equity (2-7), and many scholars have identified potential winners and losers from various pricing schemes (5, 8).  Yet if the revenues from congestion pricing are not distributed—so the only benefit is less congestion—then high-income groups gain and low-income groups will lose (6). This situation has obvious implications for remediating inequity, and suggests that if inequity is a concern at least some of the revenue should be used to promote fairness and compensate those who are made worse off.  In particular, the people who lack meaningful alternatives to paying the new tolls and fees should be afforded some type of compensation.

(The number are citations and are available through the paper at the link above.)

Now that Sam Schwartz and others are reigniting the policy interest in NYC tolls it seems timely to think a bit more about equity. There are essentially no efforts to remediate income inequity caused by road tolls in systems around the world (See my TRB paper for details). But geographic inequity is commonly compensated. For instance, on Wednesday (4/11/2012) the NY MTA announced that the Rockaway Resident Toll Rebate Program has regained it's funding. From the release:

Thanks to $4 million in funding provided in the State budget, tolls for eligible residents using the Cross Bay Veterans Memorial Bridge will once again be fully rebated by the MTA.
“We are pleased to be able to return this program to the residents of the Rockaways and Broad Channel,” MTA Chairman and Chief Executive Joseph Lhota said. “Following the approval of a budget that will allow the MTA to complete a very aggressive capital plan, restoration of the rebate program is another sign of support that Governor Cuomo and the Legislature recognize the need to maintain and provide an efficient, affordable mass transit system.”
The restoration of the rebate plan will be retroactive to April 1st when the State budget was passed. Residents in the six valid zip codes (11691, 11692, 11693, 11694, 11695, and 11697) will continue to be charged for the first two trips within a 24-hour period on the same E-ZPass tag until back office software modifications to the resident E-ZPass tags are completed by late July. Once these back office operations are accomplished, customers will receive credit for tolls incurred on the bridge retroactive to April 1st.
The Rockaway resident rebate program was modified in July 2010 as part of the MTA’s efforts to close a large budget deficit. Under the modified plan, residents in the six valid zip codes paid the discounted resident E-ZPass rate of a $1.13 for each of the first two trips across the bridge. All subsequent trips taken in the same day on the same E-ZPass tag were rebated by the MTA.
As a result of the State funding, all trips for those in the Cross Bay program will be rebated by the MTA. If funding for the program is eliminated, the modified Cross Bay rebate plan will go back into effect.
The rebate plan is only valid at the Cross Bay Veterans Memorial Bridge for passenger vehicles using E-ZPass and enrolled in the Rockaway Resident Program. It does not apply to commercial trucks, motorcycles, taxis, buses or limousines.

In 2009, prior to the rebate plan’s modification, 3.6 million trips were taken by residents participating in the Cross Bay Resident Rebate program. In 2011, 3.2 million trips were taken.

Geographic inequity is generally considered a problem that needs redress, justified by the difficultly of moving. Income inequity, however, is not seen as a problem that needs compensation. Why some types of equity are worth paying for and some aren't is a bit of a puzzle.