Transportation in Transition, Again and Always

In 1982 Milton Pikarsky and Christine Johnson published a paper titled "American Transportation in Transition."

Here are the opening paragraphs:

Today, the United States is in a transportation crisis which is of a chronic nature. It may not be sudden like the gas lines of 1974, but it is consistent and the pressures of this crisis are deepening. And because its gradual nature allows people and institutions to adjust, the crisis changes the transportation system more fundamentally than transitory gas lines or transit stop pages.

The current picture of public transportation is bleak. Indeed, each new wrinkle in the financial problems faced by the transit industry brings warnings that a breakdown of public transportation service could initiate a domino effect resulting in an urban economic collapse.

And the conclusion:

Private citizens will have to adjust to the fact that traditional transportation is likely to cost more. To reduce some of those costs, they may have to become vanpool riders or drivers, participate in neighbourhood auto mobile cooperatives, or occasionally rent automobiles or use taxis as alternatives to purchasing second cars. A variety of private transportation providers may once again become party to the transportation social contract. There is evidence that developers, too, may become party to the contract. In an attempt to make their suburban residential and commercial space more attractive, many developers are underwriting bus or shuttle services or arranging van- and carpools.  

Given the position and needs of the various principal actors, it is likely that private employers and providers will become much more involved with the direct provision of surface transportation in the future. In the best and worst of extremes, an individual could face a variety of options and a maze of prices depending on the mode, time of travel, destination, and the number of people travelling. The solution to these new transportation problems may define the future role of the public sector. Rather than owning and operating systems, the public sector may become more of a travel information broker, a facilitator, a technical adviser, and a manager of a set of service contracts.  

There is little question that the process of renegotiating the transportation social contract has begun. Each party is slowly exploring and carving out a new niche. The process will be long and progress slow. We feel certain that at the outcome, when we speak of public transportation, our concept will have grown to include a range of services and providers; rapid rail, bus, vanpools, commuter clubs, subscription services, taxis, jitneys, apartment shuttle, the private automobile, and the rental auto mobile, each serving the trip length, type, and density that is most cost-efficient. 

This piece is over 30 years old. I agree with just about all of it, and I argue many of the same things today. With all of the excitement about ridesharing and transportation network companies it is worthwhile keeping in mind such services are neither revolutionary or new ideas. Perhaps they are finally here to stay, or perhaps not. (I suspect they are, likely with different companies than exist now, but I'll save my reasoning for another time.)

Public transit's demise has been predicted for a long time, as well, and transit operates in a world of permanent financial crisis. Transit finance may not be ideal, but our transit systems have survived and many have improved. Overall, though, transportation is still in transition, and we are still expecting the next big thing to show up.

There Isn't a Surge in Transit Ridership

Mike Smart, Mike Manville and I wrote an op-ed in today's Washington Post.  The recent APTA ridership report claims that transit ridership is surging, and we argue that this is simply not true:

But the association’s numbers are deceptive, and this interpretation is wrong. We are strong supporters of public transportation, but misguided optimism about transit’s resurgence helps neither transit users nor the larger traveling public. Transit trips did rise between 2008 and 2013. But so did the U.S. population, from 304 million to 316 million, as did the total number of trips made. Simple division suggests that, if anything, transit use fell between 2008 and 2013, from about 35 trips per person annually to 34. Many numbers look impressive without denominators, but anyone who examines transit use as a rate — whether as trips per person or share of total travel — will find that transit is a small and stagnant part of the transportation system.

We argue:

So there is no national transit boom. Why does this matter? The U.S. transportation system is deeply troubled. The country has difficulty financing improvements to its aging infrastructure, and heavy reliance on driving creates congestion, increases carbon missions, pollutes our communities, and is a leading cause of injury and death. No one should pretend these problems are spontaneously solving themselves because Americans have decided en masse to ride transit instead of driving. 

Nor should we misdiagnose problems caused by too much driving as problems caused by too little transit. Building transit systems is not the same as having people ride them, and people riding transit more is not the same as people driving less (plenty of transit riders are people who used to walk). Additionally, transit is not the only viable alternative to using a car. The environment is helped when drivers switch to buses but also when drivers switch to bikes.

Do read the whole thing for a more complete argument. I actually find the recent transit ridership statistics deeply troubling and suggestive that transit might be losing core riders at the expense of system expansions. This, of course, needs additional research, but we should not think that our current approach to transit is working well. We should be outraged at how little actual effect the billions and billions and billions of dollars of investment have produced. We can and should do better with our public transit investment.

Transport Finance without the Feds: The Canadian Model

Transport planning and policy in the United States is dominated by the federal gas tax. Currently 18.6 cents per gallon of gas and 24.6 cents per gallon of diesel, federal gas taxes are used to guide preferred transport investment across the country. For the past forty or so years, the federal gas tax has, in the words of Lisa Schweitzer, been buying everyone’s lunch. Yet all is not well. The federal gas tax hasn’t increased in 20 years, reducing the absolute and relative buying power of the revenue. Increased federal regulations and interest groups limit what the gas tax can be used for, and a steady stream of other people’s money (federal dollars) creates incentives to spend on transport projects that offer few benefits. At an extreme, transportation projects are developed and financed by federal monies withouteven bothering to claim any transportation benefits.

The declining share of federal money for transport finance has many people worried that transportation policy and finance will devolve to the states. Such devolution of authority is viewed as a necessarily lousy outcome, especially by progressives. (Richard Florida even wants a cabinet position for a Department of Cities. We didn't get urban renewal right the first time, so let’s try again, but with even more authority.) From my perspective, the status quo for transport policy and finance cannot be objectively defended as a success. Looking at the period of about 1971 (the year Amtrak was formed is a good marker of the beginning of the current era of federal policy, but just about any year between 1964-1974 works) to present US transport systems declined in nearly all measures of productivity, economic performance, social welfare, or just about anything else you care to measure. For whatever occasional successes US policy has had, the nation has received an extremely poor return on investments made. We can do better.

An experiment devolving transport policy and finance to the states is likely to improve overall performance of all aspects of transport. For evidence we can look to out chilly northern neighbors in Canada, which does not have anything equivalent to the U.S. Department of Transportation. Transport policy is the responsibility of the provinces, and transit policy is the responsibility of the cities. So how do Canadian cities compare?

The table below is drawn from Paul Mees’ work. The city regions are sorted by transit mode share. Every major Canadian region has higher transit mode share than US cities except New York, Chicago and San Francisco. The simple correlation between density and transit share is .48, so density does not adequately explain the differences. (Paul Mees wrote the book on this issue.) Canadian transit systems also have much higher farebox recovery ratios than in the US. The Toronto system has to maintain greater than 70% farebox recovery is order to receive subsidy for the balance.

Last week a new report on Toronto area transport finance was published that explains the financing structures in place there and potential future monies. Here is a link to the report. The authors promote many taxes and fees, all of which are economically sound and focus on raising money for transport by charging those who benefit from a well-functioning transport system. Essentially, if the Greater Toronto Hamilton Area needs new transport investment to maintain and improve economic competitiveness then they can and should raise the money locally.

 Local control can also lead to service innovations. David Levinson highlighted TransLink in Vancouver. Here is how he described the agency’s service:

TransLink is the multi-modal transportation organization for Greater Vancouver, BC, and it is unlike what we see in the States. It is in fact, closer to the idea described in Enterprising Roads, a transportation utility with autonomy constrained by oversight.One of the key points to consider is that metropolitan Vancouver has a transit mode share of 21%, comparable with much larger Toronto and Montreal (though behind metro New York's 30%, it is well ahead of Seattle's 9%), despite ranking 34th in population. Some of that has to do with institutional factors and governance.

In addition to service innovation and the ambitious expansion plans in Toronto, British Columbia instituted a carbon tax a few years ago, though this may not survive a scheduled vote in May. There are certainly problems with the decentralized system. Some Canadians want a national transit agency. Fragmented governance in regions makes coordination difficult, and perhaps a stronger regional agency is needed. Most difficult, perhaps, is that many cities forego transit service all together.* However, eliminating unproductive transit so that resources can be used elsewhere is actually good policy. But by nearly every measure Canadian transport policy outcomes are superior to US outcomes. Whether US transport finance and policy devolves to the states remains to be seen, but it certainly isn’t something that should be dismissed as inferior to what we have now. It may well be better.


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*This sentence was removed as it is incorrect (I had bad info on this case, but the larger point remains):"The city of Guelph, for instance, has 120,000 people but no bus service. "

The Problems of Transport Investment Summarized in One Sentence

This NY Times article about "instant bridges"  has a quote from a transportation official that neatly summarizes many of the problems with out current transport planning and investment systems:

“The highway department didn’t use to see the drivers as customers,” said Frank DePaola, administrator of the highway division for the department. “For a while there, the highway department was so focused on construction and road projects, it’s almost as if the contractors became their customers.”

This is a bridge replacement on a road, so referring to drivers is appropriate.  The idea that the clients being served are the contractors is problematic. The taxpayers, be they drivers, riders, cyclists, walkers,  or some combination of them all, are the ones who should be the priority. Considering that travel time savings are a major factor used to justify expensive projects it is a wonder that delay caused by really long construction periods is not a larger concern. This quote illustrates many of the issues raised though public choice theory.

Certainly there are some efforts underway to speed up construction times, such as Carmageddon last year. There are ways that the public can foster faster construction. One way is to charge rents for road space to the companies doing the construction. If a company has to take some capacity out of service for whatever reason, then they have to pay the value of the delay caused drivers. This will reduce construction times as the less time a road is out of service the lower the costs to the construction companies. If infrastructure were privatized rents for time out of service would be standard operating procedure. For example, Chicago Parking Meters, the company that owns the rights to Chicago's parking meters through 2084, must be paid by the city if any of the parking meters are taken out of service for any amount of time. (I'm not advocating privatization, just highlighting an example where this approach has been implemented.)

Considering how long infrastructure construction and maintenance takes, any policies that help speed up the process should be considered.

Autonomous Cars and Transport Finance

A few links of interest:
CNN has a video with a UT researcher working on autonomous cars.


The LA Times reports on car to car communication to improve safety.

And two from the NY Times on transport finance:

The federal tax credit for alternative powertrains will increase to $10,000. Will this lead to a corresponding increase in prices? We shall see!

And a post about whether or not electric vehicle drivers should be taxed for road use. As gasoline and diesel decline in importance as a transport fuel for personal travel the conventional way to pay for transportation will also decline. In my opinion, the sooner we shift towards more user fees to finance transport the better.

Two bonus links:

The unions finally have some good news.

Lots of new money for NASA's space taxi. There are lots of private companies also developing space taxis.  The good news is space travel will be cheaper. The bad news is that there will be more space travel, which will accelerate climate change emissions entering the atmosphere.  These effects will likely more than offset any reductions in emissions from ground transport. More bad news is that orbital space junk will make private space travel impossible. Or so says Policymic. Unless this works.

How Much Control Do States Have Over Transport Funding

The proposed (and DOA) House transportation spending bill has lots of people thinking about the federal role in transport funding. In short, the US House bill eliminates federal transit support and allocates the gas tax to roads. It's a bit jarring, for sure, but raises lots of issues about federalism and transport policy. Lisa Schweitzer has a series of excellent posts about this at Urban Ethics and Theory (start with her conclusion), and I suggest you review what she has to say about this.

But others are supporting the federal role because they claim that states and local governments are already making their transport investment choices, so the federal role doesn't alter how the money is spent. The Transport Politic has a post about this here. He argues that "devolution is overrated." I'll argue that this analysis is not quite right because it is limited to the role of fuel taxes and because it undervalues the political distortions.

Freemark does say that states and localities have screwed up spending projects before, and he's right that they have. This doesn't mean that the federal government is better in the role of deciding what projects to fund, however. In fact, many states, counties and metro areas use sales taxes to build new systems and maintain roads, and these taxes are often voted on directly buy the voters. (Sales taxes may be a more regressive form of paying for infrastructure than fuel taxes, and perhaps an analysis of tax incidence might support a federal role, but that's not what the opponents of the House measure are arguing.) When put on a ballot new taxes for transportation projects are overwhelmingly passed (about 75% of the time), even when the new taxes are going to be used for expensive transit investments. These may not be good investments in many cases, but there is ample evidence to suggest that in the absence of federal funding or a complete devolution to local and state decision making transit would not be defunded or in danger of going away.

The federal role complicates local decision making due to political constraints. First, as a piece of background, nearly all gas taxes collected are returned to the state where they were generated. By law at least 92% of all receipts has to be returned to the state where they were generated, and in many cases it is much higher. (This is a new-ish law so don't look at historical donor-donee figures for this.) But all new projects, even if they are listed as a priority by the states, must comply with all federal guidelines and policies. These can greatly increase the costs of projects in both time and money. New York City moved forward with the 7 line extension of the subway system without federal money because of compliance concerns.* Moreover, the federal guidelines through SAFETEA-LU favor commuter oriented projects that have a lot of time savings. These may not actually be high priorities for states and cities, but if you want any money you have to adhere to these guidelines. In addition, federal matching money policies act as incentives for transport plans to maximize their matching dollars, not design the best transport investment. Remember, 10 years ago no one was considering street cars in US cities. Now there are over 70 projects under consideration because the Obama administration committed $280 million for streetcars. Those 70 projects are there because of federal priorities, not because of local preferences. (I've mentioned this before.)

To make a point about local mistakes versus federal mistakes, these streetcars are likely to be a disaster. Operating in mixed-traffic, they will slow down transit, congest auto travel and worsen pollution. This occurred in Paris as dedicated bus lanes were replaced with streetcars. However, if cities paid for these themselves then a few would install streetcars and the rest would realize they are a bad idea.Instead, the federal government will pay for all the streetcars so everyone will realize they are a bad idea after they are all built, so rather than a few bad projects and a little cost we will get lots of bad projects at a lot of cost.

Overall, the role of federal funding for transportation has likely peaked as the gas tax has peaked. I doubt that any federal tax will replace that buying power, and it will be the onus of states, regions and cities to  fund more of their transport investments. (If you think the prospects of higher federal gas taxes are grim, you should consider how much worse the prospects for federal user fees are.) I won't speculate as to what that means for road or transit funding, but will say it will be different. The sooner that states and cities start crafting policies to pay for their transport priorities the better off we will all be, and the more responsive these policies will be to people's concerns.

*The city did ask for federal help with a second station when costs increased but was turned down.