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Just Transit? Transit Dependents, Civil Rights,
and Transit Policy
Brian D. Taylor
Hiroyuki Iseki
UCLA Institute of Transportation Studies
October 2001
Lake Arrowhead, California
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Transit Equity?
• In recent years, most equity debates in public transit concerned the “fair” distribution of resources among jurisdictions.
• Tendency is toward treating voters equally.
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Transit Equity?
• But the use of transit is very uneven spatially.The 10 largest U.S. transit systems account for
over 60% of all transit trips.About 1/3 of all U.S. transit trips are taken in
metropolitan New York.
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Transit Equity?
• The results are uneven in two ways:Transit systems in the oldest and largest central
cities receive the highest taxpayer subsidies, in absolute terms.
Transit riders on newer, smaller suburban transit systems tend to receive the highest taxpayer subsidies, in relative terms.
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Transit Equity?
Operating Subsdies Total Total Operating
and Passengers - 1998 Operating Unlinked SubsidySubsidies Passengers Per Trip
New York City Transit Authority $913,162,490 2,225,622,700 $0.41San Francisco Municipal Railway $204,007,010 219,508,000 $0.93
Livermore-Amador WHEELS, CA $4,365,070 1,462,500 $2.98Triangle Transit Authority, NC $2,377,420 682,500 $3.48
Source: National Transit Database
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Why do we subsidize public transit?• Direct benefits: Provide mobility for those without
access to private vehicles, and travel options for those who choose not to drive.
• Indirect benefits: Decrease traffic congestion and reduce travel times for all travelers; reduce energy consumption, vehicle emissions, suburban sprawl, amount of land devoted to roads, motor vehicle noise, and accident costs.
• Network/Service economies: Subsidies are required to maintain comprehensive transit route networks with sufficient service frequencies to avoid a downward spiral of declining ridership and service.
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Why do we subsidize public transit?
• Compensate for policy bias in favor of private vehicles: Subsidize transit fares to compensate for public policies which do not fully charge drivers for the social costs of auto use.
• Equity: Public transit is an indispensable social service that provides access to basic needs for transit dependents.
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The Truth About Transit:Most Transit Users are Bus Riders,
and Most Bus Riders are Poor
Source: 1995 Nationwide Personal Transportation Survey.
MODE MEDIAN HOUSEHOLDINCOME CATEGORY
MODAL HOUSEHOLDINCOME CATEGORY
Transit Bus $15,000 - $19,999 $ 5,000 - $ 9,999Urban Rail $30,000 - $34,999 $15,000 - $19,999Commuter Rail $40,000 - $44,999 $55,000 - $59,999Private Vehicle $45,000 - $49,999 $35,000 - $39,999
Overall, 1/3 of all transit users come from households with 1995 incomes below $15,000, and 3/5 from households with 1995 incomes below $30,000 (Pucher, 1998).
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Conflicting Policy Goals
Serve low-income transit dependents
Expand commuter-oriented services
ISTEA and TEA-21 mandates require the expenditure of federal funds for transportation purposes to comply with Title VI of the Civil Rights Act; these have prompted civil rights lawsuits against transit agencies over supposedly discriminatory fare policies and/or expansion of commuter-oriented services.
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Policy Questions Guiding This Issue
• Who “wins” and who “loses” in the subsidy of public transit?– In general, is the subsidy of public transit
progressive or regressive with respect to income?
– More specifically, how are transit subsidies distributed among various classes of riders?
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Findings in a Nutshell
1. Because the tax system is generally progressive, transit subsidies tend to transfer benefits from higher-income people to low-income people.
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Findings in a Nutshell
1. Because the tax system is generally progressive, transit subsidies tend to transfer benefits from higher-income people to low-income people. although low-income non-transit-users are
significant losers in this transfer.
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Findings in a Nutshell
1. Because the tax system is generally progressive, transit subsidies tend to transfer benefits from higher-income people to low-income people. although low-income non-transit-users are
significant losers in this transfer. If the goal is simply income redistribution,
there are better ways to do it than subsidizing transit.
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Findings in a Nutshell
2. Among transit users, the distribution of transit subsidies is generally regressive with respect to income.
higher-income transit users tend to be subsidized more than low-income transit users.
Estimating this distribution of transit subsidies among various transit users, however, is a complex endeavor.
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Analysis Flowchart
C os t Effic iency
C ost per Vehicle H ourb y T im e o f D ay
b y L ine
C ost per Passenger-M ileb y T im e o f D ay
b y L ine
Trip C harasteristicsT im e o f D ayT ran sit L ine
T rip Dis tan ce
C ost per Passenger Trip Fare per Passenger Trip
Subsidy per Passenger Trip U ser G roups:E xp ress /L o ca l P ax,
C h o ice R id ers /T ran s it D e p end en ts
Subsidy per Passenger Tripam ong Vairous U ser G roups
O D Survey D ata
C ost Allocation S tudy
C om putation or Analysis
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Data Sources
• LA MTA Reports1. Line Performance Trends Report
2. Consolidated Transit Service Reports
(Ridecheck Report)
3. Schedule Quality Report
• National Transit Database
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The Problem of PeakingThe marginal cost of transit service is typically highest in the peak period and peak direction.
• Lower labor efficiency:
– Limits on the use of part-time labor and of split- and spread-time shifts.
• Lower equipment utilization efficiency:
– Extra vehicles needed to meet peak period demand,
– A higher proportion of non-revenue service
(extra deadheading and trippers),
– Scaling facilities to accommodate peak service levels.
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Time-of-Day Variation in Service Levels: Los Angeles MTA
0
200
400
600
800
1000
1200
Nu
mb
er
of
Bu
s R
un
s
12 3 6 9 noon 3 6 9Time of Day
Owl AM Peak PM PeakMidday NightEvening
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Comparison of Individual Line Costs Using a Partial Cost Allocation Model
$0
$50
$100
$150
$200
Cost per In-S
ervic
e V
ehic
le H
our (
$U
S)
Bus Lines
Peak MTA ShoulderBase
Lines with 24 hour service
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Comparison of Estimated Costs between the then-current LA MTA Model and a Full-Cost Allocation Model
$0
$20
$40
$60
$80
$100
$120
$140
$160
Co
st p
er
In-S
erv
ice
Veh
icle
Hou
r ($
US
)
Base Base+ShoulderShoulder Peak
Other Capital
Vehicle Capital
Vehicle Hours
Vehicle Miles
Peak Vehicles
Boardings
Modified Fully-Allocated Model
CurrentMTAModel
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Peak/Base Ratios of the Twenty-Seven Largest Transit Operators
1.41.5 1.5
1.6 1.6 1.61.7 1.7 1.7
1.8 1.81.9 1.9 1.9
2 2 22.1
2.2 2.2
2.62.7
2.8
3 3 33.1
1
1.5
2
2.5
3
3.5
MD
TA
OC
TA
LA
CM
TA
NY
CT
A
Mun
i
SCC
TD
SEPT
A
PAT
Tri
-Met
CT
A
D-D
OT
RT
A
NY
CD
OT
AC
Tra
nsit
RT
D
Met
ro N
orth
PAT
H
MA
RT
A
NJ
Tra
nsit
BA
RT
MB
TA
Met
ro (
Hou
ston
)
MT
C
DA
RT
Met
ro (
Kin
g)
WSD
OT
Mar
ylan
d M
TA
Transit Agency
Pea
k t
o B
ase
Rat
io
LA MTA
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Comparison of Estimated Bus System and Light Rail Costs(Cost per Passenger Capacity Hour)
$0
$1
$2
$3
$4
Cost per
Passenger
Capacity H
our
($U
S)
Base Shoulder Peak
Other Capital
Vehicle Capital
Vehicle Hours
Vehicle Miles
Peak Vehicles
Boardings
Bus System
CurrentMTAModel
Modified Fully-Allocated Model
$0
$1
$2
$3
$4
Cost per
Passnger
Capacity H
our
($U
S)
Base Shoulder Peak
Other Capital
Vehicle Capital
Vehicle Hours
Vehicle Miles
Peak Vehicles
Light Rail
ImputedMTAModel
Modified Fully-Allocated Model
Using MTA Model and Fully-Allocated Model
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LA MTA Bus Rider Demographics1995 Household
Income < $7.5k $ 7.5-15k $ 15-35k $ 35-50k $ 50-75k > $ 75k
40.2% 29.0% 20.6% 6.0% 2.8% 1.5%
Race/Ethnicity Native
Ame. Asian/PI
Isl. Black Hispanic White Other
1.1% 8.7% 22.1% 52.1% 12.5% 3.4%
Age Under 18 18 - 24 25 - 44 45 - 64 Over 65
7.6% 18.0% 44.3% 21.8% 8.3%
Sex Female Male
55.2% 44.8%
Data source: Service Planning Market Research Program, FY96-97 MTA Bus On-Board Passenger Survey.
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Per Trip Subsidies for Service Types by Income
$0.00
$2.00
$4.00
$6.00
$8.00
$10.00
$12.00
Less than$15,000
$15,000 to30,000
$30,000 to50,000
$50,000 ormore
No answ er All
Income Level
US
$
Local Bus Express Bus Blue Line All Modes
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Per Trip Subsidies for Service Types by Race/Ethnicity
$0.00
$2.00
$4.00
$6.00
$8.00
$10.00
$12.00
White Hispanic Black Asian/P.l.* AI**/Aleut Other AllRace/Ethnicity
US
$
Local Bus Express Bus Blue Line All Modes
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Per Trip Subsidies for Service Types by Age Group
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
$8.00
$9.00
$10.00
Under 18 18 to 21 22 to 65 Over 65 No answ er AllAge
US
$
Local Bus Express Bus Blue Line All Modes
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Per Trip Subsidies for Service Types by Sex
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
$8.00
$9.00
Male Female No answ er AllSex
US
$
Local Bus Express Bus Blue Line All Modes
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Per Trip Subsidies by Time of Day by Income
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
$8.00
$9.00
Less than$15,000
$15,000 to30,000
$30,000 to50,000
$50,000 ormore
No answ er All
Income
US
$
Base Midday
Peak Not Specif ied
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Factors Influencing Demographic Variation in Subsidies
1. Demographic variation in transit subsidies are due to demographic variation in service consumption.
Most of the differences in subsidy levels by income are due (primarily) to the longer average trip distances of higher-income riders and (secondarily) to their greater use of capital-intensive and commuter-oriented modes.
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Factors Influencing Demographic Variation in Subsidies
2. Subsidies by time of day vary little after controlling for trip distance and travel mode.
The higher unit costs of service supplied during peak periods are mitigated by higher levels of peak-period utilization in the case of the LA MTA.
This would likely change, however, should the MTA expand peak-period service in an effort to reduce standees.
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Comparison of Estimated Bus System and Light Rail Costs(Cost per Seat Hour)
$0
$2
$4
$6
$8
$10
$12
Cost per
Seat H
our
($U
S)
Base Shoulder Peak
Other Capital
Vehicle Capital
Vehicle Hours
Vehicle Miles
Peak Vehicles
Boardings
Bus System
CurrentMTAModel
Modified Fully-Allocated Model
$0
$2
$4
$6
$8
$10
$12
Cost per
Seat H
our
($U
S)
Base Shoulder Peak
Other Capital
Vehicle Capital
Vehicle Hours
Vehicle Miles
Peak Vehicles
Light Rail
ImputedMTAModel
Modified Fully-Allocated Model
Using MTA Model and Fully-Allocated Model
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Two Caveats...
1 The results presented here are preliminary.
2 While the data are from Los Angeles, our focus is not on the MTA per se.• Given both the diversity of MTA riders and the
low levels of peaking on MTA buses and trains,• the MTA probably has less demographic
variation in subsidies than at most other transit operators nationwide.
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Conclusions
Because the subsidy of a transit trip is a function of the variable cost of that trip minus the fare paid by a traveler, the key to equalizing subsidies is a fare policy.
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Conclusions
1. Transit managers should have a clear sense of the variability of service production costs.
2. As a general principle, fares should be set to vary in rough proportion with costs.
3. The adoption of such a marginal, cost-based fare structure can simultaneously increase both efficiency and equity in the use and subsidy of transit service
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ConclusionsLinking fares to costs…
Efficiency would increase by:1. Encouraging passengers to consume more
inexpensive-to-provide transit service (short, off-peak bus trips);
2. Encouraging passengers to be more judicious in their consumption of expensive-to-provide transit service (long, peak trips on capital intensive modes).
In concert, these two factors would work to decrease overall subsidies per rider.
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ConclusionsLinking fares to costs…
Equity would increase by:1. Lowering (in relative terms) the price of transit
services disproportionately consumed by low-income passengers; and
2. Increasing (relatively) the price of transit services disproportionately consumed by higher-income passengers.
In concert, these two factors would work to eliminate the regressivity of current transit subsidies.
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Just Transit? Transit Dependents, Civil Rights,
and Transit Policy
Brian D. Taylor
Hiroyuki Iseki
UCLA Institute of Transportation Studies
October 2001
Lake Arrowhead, California
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Conclusions1. Transit managers should have a clear sense of the
variability of service productions costs.2. As a general principle, fares should be set to vary in
rough proportion with costs.3. The adoption of such a marginal cost-based fare structure
can simultaneously increase both efficiency and equity in the use and subsidy of transit service
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Intended to be blank.
SUBSIDY COST FARE DISTANCE Cost/Distance
All $4.12 $4.94 $0.82 8.04 $0.61
Service Local Bus $3.17 $3.95 $0.77 6.33 $0.62Express Bus $6.28 $7.31 $1.03 13.52 $0.54Blue Line $7.85 $8.63 $0.79 12.21 $0.71
Time of Day Base 4.42 5.22 0.79 8.13 $0.64Midday 4.00 4.81 0.81 8.06 $0.60Peak 4.33 5.18 0.85 8.23 $0.63Not Specified 4.19 4.98 0.79 7.61 $0.65
Income Level Less than $15,000 $3.62 $4.40 $0.78 7.30 $0.60$15,000 to 30,000 $4.13 $4.95 $0.82 8.14 $0.61$30,000 to 50,000 $5.27 $6.18 $0.91 9.83 $0.63$50,000 or more $6.77 $7.72 $0.95 12.02 $0.64No answer $3.73 $4.55 $0.81 7.19 $0.63
Race/Ethnicity White $4.70 $5.47 $0.77 8.82 $0.62Hispanic $3.82 $4.67 $0.85 7.71 $0.61Black $3.88 $4.71 $0.82 7.46 $0.63Asian/P.l.* $4.88 $5.64 $0.76 9.22 $0.61AI**/Aleut $3.88 $4.68 $0.80 8.37 $0.56Other $4.18 $4.96 $0.78 8.49 $0.58
Sex Male $4.51 $5.31 $0.81 8.72 $0.61Female $3.93 $4.76 $0.83 7.72 $0.62No answer $3.55 $4.34 $0.79 6.95 $0.62
Age Under 18 $3.01 $3.76 $0.75 5.86 $0.6418 to 21 $3.54 $4.43 $0.88 7.14 $0.6222 to 65 $4.34 $5.20 $0.86 8.48 $0.61Over 65 $3.58 $3.88 $0.29 6.47 $0.60No answer $3.96 $4.77 $0.81 7.64 $0.62
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Purpose of This Study
• Develop a cost estimation method that, in contrast to typical cost allocation models:
1. is more sensitive to cost variation by time of day,
2. takes into account vehicle and non-vehicle capital costs,
3. takes into account the passenger capacity of vehicles in various transit modes.
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Data Sources
• LA MTA Reports1. Line Performance Trends Report
2. Consolidated Transit Service Reports
(Ridecheck Report)
3. Schedule Quality Report
• National Transit Database
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Transit Cost Allocation Models• Service costs are a function of service outputs.
• Service outputs are most commonly measured in terms of: vehicle-hours, vehicle miles, and peak vehicles.
Variable CostsSemi-fixed
CostsFixed Costs
Vehicle hours Strong Strong Moderate
Vehicle miles Strong Moderate Weak
Peak vehicles Weak Strong Strong
Source: Adapted from Taylor (1975)
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Partially- and Fully-Allocated Models
• Partially-allocated model
includes only variable costs and some semi-fixed costs to reflect the marginal costs of incremental service modifications.
• Fully-allocated model
includes most or all fixed costs for the use of comparing performance between modes or systems.
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Average Cost Approach to Allocating Costs by Service Levels
6am 9 noon 3 6 9pm
a
b
|–––– t2 –––| |–––– t2 –––| No. of buses|–––––––––––––––––––––– 2t2 + t1 ––––––––––––––––––––––––|
6am 9 noon 3 6 9pm
a
b
|–––– t2 –––| |–––– t2 –––| No. of buses|–––––––––––––––––––––– 2t2 + t1 ––––––––––––––––––––––––|
C t a b UP 2 2 ( ) *
C t b UB 1 *
SC
C
t a b
t b
P
B
2 2
1
( )
a, b: the number of required buses CP, CB :vehicle hour-related costs of the Peak and Base serviceU :unit cost of service output
S :the ratio of peak costs to base costsSource: Adapted from Cervero (1980)
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The General Form of a Cost Allocation Model
C = U Xi i
i=
n
1
C :estimated costs i :a particular measurable service output which represents the scale of operationsn :number of service outputs included in the modelUi :unit cost of service output iXi :quantity or value of service output i in the analysis
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Labor Utilization Factor for Vehicle Hour Unit Cost
• LUFi :Labor Utilization Factor for period i
• PHi :pay hours for period i
• VHi :vehicle hours for period i
• n : relative labor productivity (= (PHP/ VHP) / (PHB /VHB) = 1.302)
• s : vehicle hour coefficient (= VHP / VHB)
• PHP or B : pay hours for peak or base period
• VHP or B : vehicle hours for peak or base period
Un( s)
( ns)*UP V H V H
1
1U
( s)
( ns)*UB V H V H
1
1
L U FP H
V H
V HiP Hi
ii
i
i
i
Source: Adapted from Yu (1986) and Cherwony and Mundle (1978, 1980)
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Accounting for Vehicle Utilization
• Vehicle Utilization: Lower during peak periods– To account for the variability in deadheading and inter-lining
between time periods, expenses were allocated to each period on the basis of total (or “scheduled”) vehicle miles, but costs were calculated on the basis of revenue (or “in-service”) vehicle miles and hours.
Period Rev VM Tot VM Cost per revenue VM .Peak 30 miles 60 miles ==> $ 600 $600 / 30 miles = $20.00 per revenue VMOff-peak 30 miles 40 miles ==> $ 400 $400 / 30 miles = $13.33 per revenue VM Daily Total Cost $1,000
Daily $1000 / 100 = $10 per SVMPeak 60 / 30 = 2.000 $10 * 2.000 = $20.00Off-peak 40 / 30 = 1.333 $10 * 1.333 = $13.33
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Including Semi-Fixed and Vehicle Capital Costs
Service layer
6am 9 noon 3 6 9pm
peak a
base b
|–––– t2 –––| |–––– t2 –––| No. of buses |–––––––––––––––––––––– t1 + 2t2 –––––––––––––––––––––––|
Service layer
6am 9 noon 3 6 9pm
peak a
base b
|–––– t2 –––| |–––– t2 –––| No. of buses |–––––––––––––––––––––– t1 + 2t2 –––––––––––––––––––––––|
6am 9 noon 3 6 9pm
|–––– t2 –––| |–––– t2 –––| No. of buses |–––––––––––––––––––––– t1 + 2t2 –––––––––––––––––––––––|
C = ( t t )b U1 1 2 12 *
C = t a U2 2 22 *
Ct
t tC CP
2
2
2
2 11 2
C1 :The cost assigned to the base period
C2 :The costs of the additional peak service
Cp :The costs in the Peak period (2t2)
U :unit cost of service output in each periodSource: Adapted from Levinson (1978) and Cervero (1980)
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Marginal Cost Approach to Allocating Vehicle Capital Costs
Service layer /# Buses 3am 6 9 noon 3pm 6 9
VI 6 $565
V 663 $31,207 $31,207
IV 168 $3,954 $7,908 $3,954
III 638 $12,012 $24,024 $12,012 $12,012
II 207 $3,248 $6,496 $3,248 $3,248 $3,248
I 58 $1,365 $682 $1,365 $682 $682 $682
Owl AM Peak Midday PM Peak Evening Night
Total Cost/Day $1,365 $51,668 $39,792 $51,103 $15,942 $3,930
Assumption: All buses in service during base periods are available for use during peak periods.
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Modified Cost Models• Fully-Allocated Model -- Including all variable, semi-fixed, and fixed costs
FACi,j = OCi,j + CCi,j
= ( LUFi,j * UVH * VHi,j + UVM * VMi,j + PVCi,j + UTP * TPi,j )
* ( 1 + F ) + VCCi,j + OCC * ( IVHi,j / IVHday,system)
( LUFi,j = 1, F = UTP = 0 for LRT )
• Partially-Allocated Model I -- Excluding non-vehicle capital costs
PACi,j = OCi,j + VCCi,j
= ( LUFi,j * UVH * VHi,j + UVM * VMi,j + PVCi,j + UTP * TPi,j )
* ( 1 + F ) + VCCi,j
• Partially-Allocated Model II -- Including only variable and vehicle capital costs
PACi,j = OCi,j + VCCi,j
= ( LUFi,j * UVH * VHi,j + UVM * VMi,j ) + VCCi,j
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Comparison of Individual Line Costs Using Partially-Allocated Model I
$0
$50
$100
$150
$200
Cost per In-S
ervic
e V
ehic
le H
our (
$U
S)
Bus Lines
Peak MTA ShoulderBase
Lines with 24 hour service
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Cost of Additional Vehicle Run for Five Sample Bus Lines by Time Periods
$0
$50
$100
$150
$200
$250
$300
$350
AM
pea
k
Mid
day
PM
pea
k
Nig
ht
MTA
AM
pea
k
Mid
day
PM
pea
k
Nig
ht
MTA
AM
pea
k
Mid
day
PM
pea
k
Nig
ht
MTA
AM
pea
k
Mid
day
PM
pea
k
Nig
ht
MTA
AM
pea
k
Mid
day
PM
pea
k
Nig
ht
MTA
Cos
t pe
r V
ehic
le R
un (
$US
)
Line 4: Santa Monica
Blvd.
Line 45: Broadway - Mercury Ave.
Line 200: Alvarado St.
Line 204: Vermont Ave.
Line 446: San Pedro -
Union St.
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Findings-Phase IIn this case study comparing these models with the one currently used by the LA MTA:1. Peak period bus costs are estimated to be higher (36 %);
2. Base period bus costs are estimated to be lower (15 %); 3. LRT unit costs are estimated to be substantially higher
than bus costs (57~113 %) per unit of passenger capacity. 4. Incremental changes in bus service are estimated to be
substantially lower (29~75 %), regardless of time-of-day.
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Linking Model to Travel Data• Travel demographic data are drawn from the annual MTA
On-board Passenger Survey.
• Survey gathers information on trip characteristics and travel demographics.
• Approximately 5,000 surveys are collected each year; our cleaned, 3-year data set contains 10,710 records.
• The cost per passenger mile estimated from our model was applied to each record.
• These estimated trip costs can then be aggregated to compare differences among different demographic groups.
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Preliminary Findings-Phase II• Consistent with the findings of other travel behavior surve
ys, the patterns of transit travel in Los Angeles vary systematically by rider demographics.
• The transit trips consumed by higher-income riders, men, and whites are estimated to be, on average, more expensive than the trips consumed by lower-income riders, women, and non-whites.
• These differences are mitigated somewhat, though not entirely, by the higher-fares charged for longer-distance express and transfer trips.
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Conclusions• Current models do not account for the high degree of
variability in the cost of providing transit service.
• Such shortcomings make it difficult decision makers to make informed decisions regarding expansions, changes, or deletions of service.
• The preliminary results of our demographic analysis suggest that current patterns of transit utilization combine with relatively flat fare policies to favor higher-income riders over lower-income riders.
• This preliminary analysis supports the linking of transit fares to costs on both efficiency and equity grounds.
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Just Transit? Transit Dependents, Civil Rights,
and Transit Policy
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Limitations of Current CostAllocation Models
• The models typically used in practice include all operating costs and exclude all capital costs, without regard to how such costs vary with the provision of service.
• The models are highly aggregated; they are typically based on systemwide costs and do not account for cost variation on individual routes, between various modes, or by time of day.
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Next Steps
• Accounting for the directional peaking of demand,• Taking weekend operation directly into account in
computing vehicle and capital costs,• Applying a “cost centers” approach to differentiate
unit costs to discrete parts of the system,• Computing relative labor productivity factors on
individual lines from the ratio of pay hours to vehicle hours by time of day.
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Figures for Cost Comparison Charts
TotalOther CapitalVehicle CapitalVehicle HoursVehicle MilesPeak VehiclesBoardings
$2.58$0.00$0.00$1.38$0.56$0.42$0.23Bus$2.21$0.18$0.07$1.21$0.50$0.13$0.12Base# of Seat: 43$2.64$0.18$0.17$1.22$0.53$0.31$0.24Shoulder$3.51$0.18$0.31$1.59$0.61$0.58$0.24Peak
$4.59$0.00$0.00$0.98$0.87$2.74$0.00Blue Line$9.90$5.37$0.73$0.95$0.81$2.04$0.00Base# of Seat: 76
$10.53$5.37$0.87$0.99$0.86$2.44$0.00Shoulder$11.58$5.37$1.14$0.98$0.90$3.20$0.00Peak
TotalCap.CostOp. CostOther CapitalVehicle CapitalVehicle HoursVehicle MilesPeak VehiclesBoardings
$111.10$ -$111.10$ -$ -$59.40$24.04$17.88$9.78
$94.96$10.57$84.39$7.58$2.99$52.15$21.56$5.58$5.10Base
$109.97$14.02$95.95$7.58$6.45$52.26$22.46$12.02$9.21Base+Shoulder
$113.42$14.82$98.60$7.58$7.24$52.28$22.67$13.50$10.15Shoulder
$151.01$21.07$129.94$7.58$13.49$68.28$26.02$25.15$10.49Peak
Comparison of Estimated Systemwide Costs between the MTA Model and the Fully-Allocated Model
Comparison of Estimated Bus System and LTR Costs
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Summary of Modification• Modify MTA’s cost allocation model to more accurately
estimate costs on individual lines in different periods of day for the Metro Bus system– Labor Utilization Factor for VH costs
– Vehicle Usage Apportionment Factor (VUAF) and Weekend Operation Factor (WOF) for PV costs
– Proportional allocation of VM and TP costs
• Include capital costs to compare system wide costs between the Metro Bus System and the Blue Line– VUAF and WUF for vehicle capital costs
– Equal distribution of other capital costs by VH
• Use of In-service VH to compute costs in comparison to account for labor and vehicle utilization efficiency
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Blue Line Operating Cost
Allocation
Unit Cost Calculation
Basis for AssignementPeak VehiclesVehicle HoursVehicle MilesOperating Expenses
Labor$0$6,744,037$0Operations$0$0$2,513,699Maintenance
$2,654,867$0$0Non-maintenance$1,980,953$0$0Administration
Fringe Benefits$0$3,414,865$0Operations$0$0$1,272,820Maintenance
$1,344,300$0$0Non-maintenance$1,003,062$0$0Administration
$15,463,218$0$205,758ServicesMaterials & Supplies
$0$0$48,134Operations$0$0$1,347,754Materials$0$0$473,326Non-maintenance
$38,754$0$0Administration$508,849$0$3,184,343Utilities
$1,679,301$0$0Casualty/Liability$32,476$0$0Taxes
$0$0$0Purchased Trans.$207,875$0$0Miscellaneous
($386,282)$0$0Expense Transfer$24,527,373$10,158,902$9,045,834Expenses Sub-total
34158,0962,997,000Service (Form 406):$721,393$64.26$3.02Unit Cost:
$2,818
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MTA Cost Allocation Model
• OC :estimated operating costs
• j :unit of analysis in question — system, line, etc.
• U :unit cost per service output
• VH :scheduled vehicle hours
• VM :scheduled vehicle miles
• PV :PM peak vehicles
• TP :total passengers
• F :fixed overhead cost factor
OCj = ( UVH * VHj + UVM * VMj + UPV * PVj + UTP * TPj ) * ( 1 + F )
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Difficulties in the Study• MTA’s different reports used different definition of time
periods. For example, the AM peak is 5-9 a.m. in one report, while it is 6-9 a.m. in another.
• Data were obtained in different years for different reports. • Many data such as SVH, SVM, IVH, IVM, PV, and TP
were not available for all six periods of day. (apportionment)
• IVH and IVM data were not available for some bus lines. (regression)
• Details of expense item assignment in MTA’s model for the Metro bus system were unknown.
• Nor was there a detailed breakdown of operating costs for the Blue Line.
• There is no specific way to compute annual capital costs.
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Assumption: All buses in service during the period with the smaller number of in-service vehicles will be utilized in any other periods that have higher vehicle requirements.
Marginal Cost Approach to Allocating Vehicle Capital Costs
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The public finance of transportation is guided first and foremost by concerns over equity
PREMISE:
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CONFOUNDING NOTIONS OF EQUITY IN
TRANSPORTATION FINANCE
Type of Equity
Unit ofAnalysis
Market Equity OpportunityEquity
OutcomeEquity
GeographicStates, counties,legislative districts, etc.
T rans po rtatio n s p end ingin eac h juris d ic tio nm atc hes revenuec o llec tio ns in thatjuris d ic tio n
T rans p o rtatio n s p end ingis p ro po rtio nally eq ualac ros s jur is d ict ions
S p end ing in eac hjur is d ic tio n p rod uceseq ual levels o ftrans po rtatio nc ap ac ity/s ervic e
GroupModal Interests,racial/ethnic groups, etc.
Eac h gro up rec eivestrans p ortat io ns p end ing/b enefits inp rop o rtio n to taxes p aid
Eac h gro up rec eives ap ro po rtio nally eq uals hare o f trans po rtatio nreso urc es
T rans p o rtatio n s p end ingp ro duc es eq ual levels o fac c ess o r m o b ility ac ros sgro up s
IndividualResidents, voters,travelers, etc.
T he p ric es /taxes p aid b yind ivid uals fo rtrans p ortat io n s ho uld b ep rop o rtio n al to the c o stsim po sed
T rans p o rtatio n s p end ingp er p ers o n is eq ual
T rans p o rtatio n s p end ingeq ualizes ind ivid u allev els o f ac ces s o rm o b ility
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• What one individual, group, organization, or jurisdiction views as fair and equitable, another may view as unfair and unjust.
• Both views may be correct.
Unjust Equity
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Types of Equity
• Market Equity: Bring prices in line with costs imposed and/or benefits received
• Opportunity Equity: Treat individuals, interest groups, or jurisdictions equally
• Outcome Equity: Redistribute resources to effect equal outcomes
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Why do people debating equity in transportation seem so often to be
talking past one another?
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Because they focus on different units of analysis
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Units of Analysis in Transportation Policy
• Individuals: residents, voters, travelers, etc.
• Groups: modal interests, racial/ethnic groups, etc.
• Areas (geographic): states, counties, legislative districts, etc.
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Factors Influencing Demographic Variation in Subsidies
1. Demographic variation in transit subsidies are due to demographic variation in service consumption.- Most of the differences in subsidy levels by income are due (primarily) to the longer average trip distances of higher-income riders and (secondarily) to their greater use of capital-intensive and commuter-oriented modes.
2. Subsidies by time of day vary little after controlling for trip distance and travel mode.- The higher unit costs of service supplied during peak periods are mitigated by higher levels of peak period utilization in the case of the LA MTA.- This would likely change, however, should the MTA expand peak period service in an effort to reduce standees.
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Transit Equity?
• The results are uneven in two ways:Transit systems in the oldest and largest central
cities receive the highest taxpayer subsidies, in absolute terms.
Transit riders on newer, smaller suburban transit systems tend to receive the highest taxpayer subsidies, in relative terms.