Another Port Authority Doesn't have money scare….yawn

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Aaron S
Participant
#

So the only reason I’m posting this (rant) here is because I believe a few people who know people who have a bit of sway with the Port Authority read some of the threads…

Anyway, yeah, another Port Authority doesn’t have money article. Cuts by !5% because their management can’t figure out anyway to make the public transit system solvent. [1] Cry me a river.

Let’s review the situation. You have a major transportation agency in a mini-city that is trying to rebrand itself as “green”. In that mini-city commuting costs are up (between 8 and 9 percent [2]), which isn’t interesting. Everyone knows that. Public transit has been marketed as a cost cutting way of commuting forever. That branding also won’t work except in climates of frugality (i.e. recession) or for those who pride themselves as frugal (i.e. the millionaire next door type). Most Americans pride themselves on the “I”m worth it, so I’ll spend it” mindset.

Now the really interesting bit of information in [2] is that “fewer employers are contributing to those costs with bus passes or discounts”.

Connecting the dots here: Dear Port Authority management, please commission a talented salesforce to get a few of the larger companies in the city to buy workforce wide bus passes for their employees a la CMU & Pitt again. Additionally add some block-size programs for small businesses to buy their employees bus passes on a scale of say paying for 2 out of 5 employees who receive them. (I’m not sure what the numbers should be, just making one up there).

Then allow the companies to announce those “partnerships” to promote how green they are. Or work with city/county councils/leadership to offer tax breaks for buying into the program.

Or go a step further with the law firms who will surely say they can’t do this because many of their lawyers have to drive to their clients: partner with an organization like zip car to offer bus passes and zip car usage so the lawyers can use the cars.

Just some thoughts.

[1] Schmitz, J. “Port Authority to consider 15 percent service cuts”, http://post-gazette.com/pg/11010/1116835-455.stm

[2] Kalson, S. “Report cites Downtown dynamics”, http://www.post-gazette.com/pg/11004/1115408-53.stm


Steven
Participant
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Do you have some reason to believe the Port Authority hasn’t been marketing its services to companies?

In any case, fares aren’t a large part of the Port Authority’s budget. It’s mostly a service funded by taxes.

In FY2010, fares brought in $75 million, Access $12 million. Combined with all other revenue including leased service, they got $96 million in revenue.

Expenses were $317 million, primarily wages and salaries ($141 million) and pension and other benefits ($128 million).

So most of the expenses are paid by taxes. About $184 million came from the state, $27 million from the county.

Say a new salesman increases bus pass sales, and overall fare income increases by 25% (about $18 million).

But that means a corresponding increase in wages and benefits for the new drivers required by all the new passengers on already-full commute-time trips. If wage and benefit expenses go up by just 15%, that’s $40 million in additional expenses. You now need an additional $22 million in tax revenue to pay for the increased ridership. Plus you have to pay the brilliant salesman who made your bottom line worse.


dooftram
Participant
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What Steven said….the problems and numbers involved in the mess we call PAT are myriad, complex, and vexing far beyond some simple marketing schemes. Not all the world is as simple as salesmanship.


Aaron S
Participant
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So what you’re saying is that more riders will actually cost the Port Authority more money than they will bring in?


Aaron S
Participant
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fwiw, my original comment was an attempt to think of a way other than asking for more tax money to plug there shortfalls.

Or at least to bring the Farebox-Recovery Ratio up to around 50-60% like other major cities, from the ~30% that 96/317 would be (granted this isn’t my area of expertise and my numbers are probably a bit off).

http://en.wikipedia.org/wiki/Farebox_recovery_ratio


StuInMcCandless
Participant
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*long sigh* OK, again, where to begin?

I have been pushing transit among my co-workers since 1992. PAT has had two immensely attractive setups in its arsenal for at least that long. In one, you can buy your bus pass with pre-tax money. In the other, your employer simply buys the pass and gives it to you, taking the cost as a tax-deductible write-off. Neither has ever caught on, and it is not because of money, at least at the level of employer and employee.

The problem is technology. The lack of it.

Getting people to use transit, who do not now use it, is damnably difficult. To get either employers or employees to buy into this, they have to bite not just a bullet but a cannonball, to commit wholly to using transit. For most people, it’s damn near impossible to get them to try riding a 71A from Oakland to Downtown even once.

Technology would make it easier to show people how to get back and forth. It simply does not exist, at least in Pittsburgh. I’ve been pushing for 15 years to make this easier to do. I quit my career for five years to try to do this. And failed. It is not easy.

When forced, people will try transit. Transit should be able to sell itself, but cannot. The information infrastructure to support that is not there. To put it there will cost money. That money is not there, has not ever been there. Their I.T. department got slashed in the 2001 and 2002 and 2007 budget cuts.

The headline today (Jan 10, 2011) about a 15% cut is not news. The info was out there in mid-December. All that’s coming out at the moment is the scheduling of the vote on whether to do the 15% cut or not.

For background info, read my 3,600-word rant on transit funding from late August [link] or the mid-December update on this 15% proposal [link].

Someday, somebody is going to take me seriously.


Steven
Participant
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So what you’re saying is that more riders will actually cost the Port Authority more money than they will bring in?

It depends, but I think that’s often true.

Getting more riders on one of the routes that makes money is good, even if you have to add more drivers. But there aren’t many. The 71A cost $1.50/trip to run, in the TDP evaluation. The EBA cost $1.29. But radial routes like the 71A averaged $2.81 in costs per trip, and busway routes averaged $1.78.

Crosstown routes were more expensive to run. The popular 54C costs $2.78 per trip; the average crosstown route costs $4.22.

The routes that go long distances or provide “lifeline” service as the only route for a community were often far more expensive. The AV (providing rush hour express service to Allegheny Valley communities) required $8.47/trip. Average cost for this type of service was $5.07/trip.

Now, the TDP revised a bunch of routes to try to bring down these costs where possible. I don’t have figures for the service that replaced the AV, but it’s likely a bit cheaper now.

Still, I think it’s safe to say that if PAT convinces more companies to get their suburban employees to commute downtown by bus, it will lose a bunch more money. From a financial perspective, it wants more people on certain short, busy routes and on busways, not more suburbanites.

But I think it’s a mistake to think of transit as a business. It’s mostly a tax-supported service for limiting congestion and the need for additional car infrastructure, for making it possible for poor people to have jobs instead of getting public assistance, for letting elderly and disabled people get around town, and for other worthy public goods. Expecting it to pay for itself is like expecting the police department to pay for itself through parking tickets.


StuInMcCandless
Participant
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+1 Steven

Let’s try an analogy. Say you have three buildings, a 3-story and two 20-story, but the elevator in one tall one only goes to the 10th floor. You might be able to rent out office space on all three floors of the short one, but your ability to rent space in the upper floors of the tall ones depends on that elevator. You do not sell tickets to take people beyond the 10th floor. The cost of the elevator is built into the rent.

The rent is analogous to taxes. Unless you expect everyone to get around on foot, you provide the horizontal elevator — transit — to get people from place to place.


BradQ
Participant
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“But I think it’s a mistake to think of transit as a business. It’s mostly a tax-supported service for limiting congestion and the need for additional car infrastructure, for making it possible for poor people to have jobs instead of getting public assistance, for letting elderly and disabled people get around town, and for other worthy public goods. Expecting it to pay for itself is like expecting the police department to pay for itself through parking tickets. “

One of the better summations of the reason public transit is called “public” and why even people like myself who never use it should support it that I’ve read in a long time.


salty
Participant
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Are the $/trip numbers based on actual ridership? If so, then obviously increasing the number of riders per bus would bring those numbers down.

I’m all for making transit “pay for itself”, just as soon as drivers start “paying for themselves”. It’s complete BS that one is viewed as a “subsidy” and the other like some divine right to “freedom”.


Steven
Participant
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Or at least to bring the Farebox-Recovery Ratio up to around 50-60% like other major cities, from the ~30% that 96/317 would be

That ratio varies a lot, and seems to be based on particularly iffy data, but it looks to me like Pittsburgh’s is in line with comparable US cities. It’s similar to Atlanta, Dallas, Los Angeles, and Orlando. It’s much better than Austin, Detroit, and Miami.

Many of the cities with a better ratio, like NYC, Boston, Chicago, are both bigger and have built extensive subway systems to serve a densely populated area. Pittsburgh has neither of those advantages.

I took a look at Philadelphia’s SEPTA. Wikipedia says as of 2002, it had a 58.6% ratio. Pretty good, right? But its 2010 budget shows $434 million in passenger revenue, and $1112 million in operating expenses, a 39% ratio. And it has the advantage of a more extensive rail system than Pittsburgh.

So I think Pittsburgh’s ratio doesn’t indicate any particular mismanagement. It seems to be pretty typical.


Steven
Participant
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Are the $/trip numbers based on actual ridership? If so, then obviously increasing the number of riders per bus would bring those numbers down.

Yes, that’s true. So it’s good to encourage more riders on routes that have room.

But consider the 13K Marshall, providing rush-hour express service from Warrendale. At $5.53/trip, it’s pretty expensive. But as the TDP service evaluation says

Average loads are close to seated capacity; based on APC data, the 6:31 am inbound trip often exceeds seated capacity, as do selected PM peak trips (see Figure 3). All trips are well used except for the last outbound departure at 6:11 pm, which carries only 10 to 15 passengers. However, this trip likely provides a “safety valve” for many riders who usually use earlier trips, and thus has greater importance than indicated by the ridership figures.

So you can try to reduce the cost per trip by encouraging more 13K riders, but pretty soon you’ll need to add more buses to hold them all.

How do you encourage more riders on the specific routes that have room, but not on the routes that don’t? Targeted ads that skip over Warrendale somehow? It’s very difficult.


ejwme
Participant
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never mind the handful of people who use the 13k in the opposite direction – the busses do turn around and head the other way, ya know. That’s also in my resolutions – I guess it’s now or never.

Maybe advertize to people who would be heading up that way anyway at that time -hem- that “hey, there’s a bus that’ll get you from downtown to this handy dandy park n ride, and probably a bus that’ll get you from your house to downtown…” and then you can put more bodies on busses that are already moving in that direction. I can think of 3000 people or so that might fit that bill, but when I tell people there’s a bus that goes right *there* (I point out the window, it’s almost visible from here), they say “really? I thought that was a city thing…”

Education. What Stu said. What Steven said. Only more.


sloaps
Participant
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I don’t see why an inbound 13k cant be an outbound 71a once making the loop downtown?

Why cant everyother, if not all, of the “unbalanced” suburban routes switch to another route – like say, between downtown and oakland? supplant the “spine line” idea from a decade ago with added interurban autobuses?

thoughts?


AtLeastMyKidsLoveMe
Participant
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This has been one of the more informative threads I can remember reading in a long time. The analogy that comes to mind in my attempt to contextualize and understand PAT subsidies is that of a “loss leader” like in retail: but in this case it is a public investment that is not expected to be met with a return, or at least with a measurable return, as it would likely be next to impossible to quantify the value of all of the people who are only able to get to jobs or better jobs, etc. via public transit.


Lyle
Participant
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How do you encourage more riders on the specific routes that have room, but not on the routes that don’t?

Route-specific fares (or surcharges). Basic supply and demand, really.

The 13K riders know a good deal and they’re exploiting it.

$5/gal for gas will change things.

@ALMKLM: I think the phrase you’re searching for is “public transit has positive externalities.” Activities with positive externalities should be subsidized; activities with negative externalities should be taxed or otherwise discouraged.


StuInMcCandless
Participant
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It costs more than $100/hour to run a bus, whether it has 5 people on it or 75 people. That cost starts when the driver punches in and starts the engine. “Deadhead” time of traveling from the garage to the start of the route, and back at the end of the run, also has to be factored in.

Closing Harmar, in my opinion, is not going to save much money. All those suburban routes, run with 1900-series buses, would then have to run out of East Liberty or West Mifflin, and have a much longer deadhead trip to get to the starting terminus. The Ross Garage cannot handle a 1900-series bus.

No, the 13A cannot “inline” into a 71A. The 1900s fail at in-city trips, and you cannot comfortably put 75 people on a 40-footer like you (sort of) can on a 1900.

The solution is not to run the 13K and its ilk in the first place.


StuInMcCandless
Participant
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The real solution is to get 50,000 families who do not now use transit to start buying monthly bus passes, whether they use them or not. 50Kpeople x 1Kdollars = $50M deficit filled. Good luck with that.


Steven
Participant
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I don’t see why an inbound 13k cant be an outbound 71a once making the loop downtown?

Some buses do switch route designations as they pass through downtown. But even ignoring the bus type issue Stu points out, I’m not sure this practice helps very often.

You’ve got lots of buses running the 71A route during rush hour. After rush hour, you need fewer. Once a 13K is done with its rush-hour-only service, it could perhaps switch to some other route, but it’s simpler to let some of the existing 71A’s you used for rush hour continue serving that route.

In other words, you need 13K’s running the 13K route during the busiest part of rush hour. And once you no longer need them, at 9 AM say, plenty of other rush-hour buses are now available as well. There’s no reason to use the 13K’s for that.

Route-specific fares (or surcharges). Basic supply and demand, really.

Let’s say you raise the fares for the 13K to match its high costs. Rides are now $5 each way. Maybe riders just grumble and accept the new rates. But perhaps most riders decide it’s not worth it, and drive in. PAT then eliminates the lightly-used route. Congestion increases by 425 cars or so. It now takes tens of thousands of motorists just a little longer to get to work each day.

We need to decide how much the benefit of reduced congestion is worth. (The other benefits, like getting elderly people mobile, probably aren’t such a big issue for the 13K in particular.) If it’s not worth what the 13K costs, scrap it.

But it’s really difficult to measure that benefit, since scrapping the route hurts (many) people in such a small way. Is getting 425 cars off the road worth the 13K’s $1300 tax subsidy each morning? How much is it worth?


salty
Participant
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Sure, just calculate the true cost of driving and the rest is easy…


TransitGuru
Participant
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Too many people are mis- and mal-informed of the transit situation. In a unique situation, transit does not have dedicated funds in Pennsylvania. Most other states have some sort of dedicated transit funding so that agencies can plan beyond each fiscal year. Right now, 60%+ of funds are state funds that are determined by the Mass Transit Line Item of the Governor’s budget. This number is essentially filled in by hand each year with no dedicated funds behind it. Act 44 attempted to fix the problem, but I-80 tolling was not approved. The county only provides a token amount of funding and federal government only provides funding for Capital Expenses (busway extensions, etc.).

Most cities around the US (besides NYC, DC, and other very few examples) have a farebox recovery ratio of approx. 30%. The rest needs to be funded by some sort of government funding structure. Very few, less than 0.01%, of transit agencies in the United States are privately run without public subsidy. In many other cities, Transit Districts are set up with the ability to tax. See StuInMcCandless’ Blog. For example, Portland uses a 0.7% income tax ($7 for every $1,000 earned) to fund almost 60% of their transit. The state provides a token amount and the farebox provides approximately 30%. This is the reverse of Pittsburgh, and the local component is based on a dedicated source.

TriMet did have service reductions as well, due to lower receipts in the tax, but not to the extent of our transit woes. This is because they can plan beyond each fiscal year and not have unexpected changes in the transit funding amount each year.

I just want all of you to know that Port Authority wants to provide good service at a fair price, but cannot until dedicated funding is in place. Right now, it is up to our legislators and governor to make the decision to provide legislation to allow proper funding of transit.


erok
Keymaster
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Right now, 60%+ of funds are state funds that are determined by the Mass Transit Line Item of the Governor’s budget. This number is essentially filled in by hand each year with no dedicated funds behind it.

So basically what you’re telling us is we’re screwed


StuInMcCandless
Participant
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Um, yes.

But maybe not. The two choices I expect the GOP-controlled new state government to put forth are (a) Not fund transit at all, (b) Forced and immediate privatization; perhaps both. Either would be catastrophic.

The plan I describe in my blog would allow local government here to decide for itself what needs to be done, instead of harping on and hoping for Harrisburg to deliver a magic solution statewide.


Pseudacris
Participant
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Erok, which neighborhood is the one orange blob in the east end?


Noah Mustion
Participant
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The orange blob is Schenley Park!


Mick
Participant
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My take is that the red and orange areas are filled with people who want the convenience of living in a city and and want to use the museums, stadiums, hospitals, and universities of the blue area, but would like the blue area people to pay all the taxes for those things.

After all, on one hand, museums, stadiums, hospitals and universities are a valuable part of our society. On the other hand, taxing people from the red and orange areas for those things would be socialism.


salty
Participant
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looks like sq hill, i’m ashamed to say… although on second look i *think* that excludes my part of sq. hill (north).

very telling map though – wow.


Lyle
Participant
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The map is scaled by area, not population. It’s very misleading.


AtLeastMyKidsLoveMe
Participant
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@lyle: Can you explain the scaling?


dwillen
Participant
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I thought they made districts based on population?


erok
Keymaster
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lyle’s saying that the map doesn’t reveal density. so if you’re one person, and own 10 acres of land, the whole area gets colored whatever you voted.

still think it’s telling tho


AtLeastMyKidsLoveMe
Participant
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Ok I get that, but the overall impression made by the graphics is accurate: city folk (who presumably are more likely to be consumers of public transit) did not vote for Corbett, while suburban outliers did. And since most politicians (aside from our President) concern themselves with making the people who voted for them happy, we could deduce that Corbett may be inclined to screw public transit.

Or am I missing something, Lyle?


Steven
Participant
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That orange area is definitely Schenley Park, not Squirrel Hill. It’s voting district 41 in the 14th ward.

Here’s a Google map with the voting districts overlaid on top, linked from here. I don’t think it’s precise, since many lines that seem intended to run down the middle of various streets don’t quite line up.


Noah Mustion
Participant
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So who votes in Schenley Park? Wild turkeys?


dwillen
Participant
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Looks like there might be a few houses near the golf course, and another half a dozen in the run? I don’t know how accurate those lines are. In any case, it seems odd to have a district for only a few people.


erok
Keymaster
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maybe schenley park will get governor’s $$$


Lyle
Participant
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ALMKLM – that’s right.

What the map implies, though is that “whoa, look, the vast majority of the state went for Corbett, only that minority of loonies in the city supported Rendell”. This is equally true of maps that show voting by state, although because the Electoral College distorts proportional representation, and because all the states have winner-takes-all nominations, the distortion is a little bit more relevant for presidential elections.

(edit: yes, I know this is obvious, but it’s pernicious. Unless you consciously remind yourself and others, the subliminal message goes unchallenged.)


ejwme
Participant
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I may not have voted for him, but I expect him, and all other politicians of the district(s) I belong to, to represent ME also.

Doing only what your voting base wants you to do is a very sure and fast way to total failure in politics. Even if he got, say, 60% of the vote – not all of that 60% is going to want the same thing. Perhaps I’m a cynic, but even once they got what they want, they may realize they didn’t actually want it anyway.


ejwme
Participant
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oh, and Stu? You sending that idea to the governor? ‘Cause you should :D


salty
Participant
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The only “people” politicians represent are the ones that line their pockets. And of course corporations count as “people” for this purpose.

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