Wednesday, January 04, 2012

Swirling down the drain, ever faster

Some months ago, I wrote about the deterioration of the Boston area transit system, linking to an article I published in Commonwealth Magazine.  We are now witnessing the sequelae of the syndrome I presented there.  The Boston Globe reports that the MBTA is seeking major fare increases and service cuts:

The MBTA would raise subway fares by up to 70 cents and dramatically cull bus routes, eliminate ferries, and end weekend commuter rail trains under a plan unveiled yesterday to help erase a projected $161 million deficit.

To be fair, this is not just about Boston.  The New York Times recently published an article entitled "The Recession Squeeze on Buses and Trains", documenting similar problems in lots of places.  About Boston, the Times noted:  "[R]idership is up, but so is debt; last year, virtually every dollar paid by riders went to debt service."

It is a mistake, though, to link these problems with the recession. There are long-lived structural issues at play.

A friend has helped me review the MBTA’s most recently reported statistics (for 2010) to the National Transit Database.  These numbers demonstrate that fares collected per boarding (column 1) generally do not cover even the direct vehicle operations plus maintenance costs per boarding (column 2).  Those costs, by the way, exclude the amounts needed to maintain fixed infrastructure and cover general and administrative categories.

Commuter Rail
Demand Response
Rapid Transit
Light Rail

Now, these are average costs, and it is harder to estimate the marginal costs of an additional trip; but there is every reason to believe that those marginal costs exceed the marginal revenues received per trip.  In other words, an increase in ridership may actually cause the system's net income to fall.  This is a terrible vicious cycle for a transit system.


76 Degrees in San Diego said...

But, "if there were no T".....there would be more street traffic, parking structures, person-car hours, fossil fuel burning, glacier melting...all leading to beach front property in the Back Bay....

Anonymous said...

You are right that these problems are not limited to Boston. Similar issues exist with the Metro system in the Washington, D.C. area, where the elevators and escalators are famous for spectacular failures and fare increases are a constant political battle.
In a truly Machiavellian twist, drivers using the Dulles Toll Road, a commuter highway from near Dulles airport into town, were recently tasked with paying for an extension of the Metro system to the airport. As you can imagine, the concept of taxing drivers to pay for mass transit on the same route on which they drive was not well received. But it was pushed through anyway, with consequent steady increases in those tolls.


jamzo said...

joe biden and arlen spector were the last powerful public transportation supporters

jamzo said...

if column 1 are fares, the bus, trolley, rapid transit fares are significantly less than new york or phila

Barry Carol said...

The New Jersey Transit rail and bus system covers about 43% of its operating costs from fares, down from a historic peak of 50%. I think 50% of revenue from fares and 50% from subsidies is about the right mix because even people who never use mass transit benefit from less road traffic than there would otherwise be without mass transit.

There is a structural problem with the mass transit business model because lots of expensive equipment is needed to serve customers during the morning and evening rush hour while much less is needed during off-peak hours. The rest of it sits idle during most of the day. This is not the case for freight trains, long distance trucking or commercial airlines. Another problem is that labor costs are higher than they need to be to attract and hold qualified people because of strong unions and significant disruption and inconvenience to the public potentially caused by strikes.

Longer term, I think the problem can be mitigated by more people working from home at least a few days a month and more if feasible. The combination of higher fares, higher highway tolls and higher gasoline taxes could drive more employers to embrace more flexible work arrangements.

I’m quite confident that, over time, if the cost of commuting either via mass transit or private automobile increases faster than general inflation, employees and employers will figure out ways to reduce the number of trips and we will need fewer trains, buses and cars as a result.

John Hunter said...

There are many failures in the USA mass transit system. Systemically we have huge up front costs - even compared to other rich countries. Other than health care, the USA is not usually much less effective than other countries (having to spend far more for no better results).