Saturday, November 16, 2013

Farebox Recovery

One thing I want to talk about on this blog is how transit is funded. There's way more to talk about than one post can handle, so let's think of this as more of a series, with this post as the prelude.

It's common in North America for transit networks, whether they are focused primarily on bus or rail, to have their most of their capital and operational costs funded by tax money. For those unfamiliar with the difference between the two, capital costs are the funds used to build, expand, and improve transit networks. This can be everything from excavating a subway tunnel to adding a sign to a bus stop that shows when the next bus will arrive. Operational costs, by contrast, are money required to run and maintain the system that's been built, including paying the drivers, maintaining and storing buses and trains, and so on.

I'm going to start by talking about operational costs. In particular, I'm going to focus on something called the farebox recovery ratio: The amount of operational cost that is covered by passenger fees. I'll start with the table that follows, sourced from the wikipedia page on the same subject, which in turn cites its own sources. I've taken the liberty of labeling which transit systems we're talking about, since there could be more than one in a city (Seattle, for example, is served by multiple transit agencies).

The table is ordered by farebox recovery ratio, from highest to lowest. I'll continue talking about this after the table. Take a look at it first. Disclaimer: The data is not perfect and some of it is old, but I still feel we can do a decent bit of analysis on this.

System Ratio Fare system Year
Hong Kong (MTR) 186% Distance based 2012
Tokyo Metro 170% Distance based 1991
Osaka (OMTB) 137% Distance based 1991
Singapore (SMRT) 125% Distance based 2008
Osaka (Hankyu Railway) 123% Distance based 1991
Taipei (MRT) 119% Distance based 2011
Toronto, Hamilton and area (GO Transit) 82.2% Distance based 2011
Amtrak 71% Distance & demand based 2009
Berlin (BVG) 70.3% Zone based 2010
Zurich (S-Bahn) 66% 1991
San Francisco Bay Area (BART) 64.5% Distance based 2008
Toronto (TTC) 63.2% Flat rate 2010
Washington, DC (WMATA) 62.1% Distance based 2010
Philadelphia/New Jersey (PATCO) 61.4% Distance based 2002
Winnipeg 60% Flat rate 2011
Beijing Subway 59.5% Flat rate 2012
Philadelphia (SEPTA) 58.6% Flat rate 2002
Montreal (STM) 57.1% Flat rate 2006
Las Vegas Monorail 56.0% Flat rate 2006
New Jersey (NJT) 56% Distance based 2001
New York City (MTA) 55.5% Flat rate 2009
Chicago (CTA) 55.2% Flat rate 2010
Copenhagen (service not specified in source) 52% 1991
Ottawa (OC Transpo) 52% Flat rate 2011
Vancouver (TransLink) 51.9% Zone based 2010
San Francisco Bay Area (Caltrain) 51.3% Zone based 2011
London Underground 50% Zone based 2004
Vienna (Service not specified in source, presumably Wiener Linien) 50% Flat rate 1991
Calgary Transit 50% Flat rate 2011
Helsinki Regional Transit Authority 49% Zone based; 2011
Brampton (BT) 46% Flat rate 2012
Mississauga (MiWay) 46% Flat rate 2011
Boston (MBTA) 43.7% Flat rate 2002
Munich Transport and Tariff Association 42% Zone based 1991
Amsterdam Metro 41.3% Zone based 2007
Madrid Metro 41.3% 2007
New York/New Jersey (PATH) 41.0% Flat rate 2002
Paris (RATP) 40% 2007
Edmonton (ETS) 39.4% Flat rate 2007
Quebec City (RTC) 39% Flat rate 2011
Stockholm Lokaltrafik 37% Zone based 2007
New York/Connecticut (Metro North) 36.2% Distance based 2009
Rome Metro 36% 2007
Brussels ITC 35.2% 2007
Harrisburg, PA (CAT) 35.0% Flat rate 2005
Atlanta (MARTA) 31.8% Flat rate 2007
Minneapolis - St. Paul Metro Transit 31.4% Flat rate with rush hour and express surcharges 2008
Los Angeles (LACMTA) 30.6% Flat Rate 2004
Dallas (DART) 28.4% Flat rate 2008
Milan Transportation System 28% 1991
Long Island Rail Road(MTA) 26.6% Zone based 2009
Maryland (MTA) 26.3% 2002
Orlando (Lynx) 25.7% Flat rate 2012
Puget Sound Region (Sound Transit) 22.2% Zone & Distance based 2007
Portland Metro Area (TriMet) 22% Flat rate 2010 2012
Cleveland (GCRTA) 21.5% Flat rate 2002
Canberra (ACTION) 21% Flat rate 2007
Puget Sound Region (King County Metro) 19.1% Zone based 2006
Miami-Dade Transit 16.1% 2002
Staten Island Railway(MTA) 15.2% Flat rate 2002
Detroit (DDOT) 13.9% Flat rate 2002
Tacoma (Pierce Transit) 13.0% Flat rate 2009
San Antonio (VIA) 12.8% Flat rate 2012
Austin (CMTA) 9% Flat rate 2007

The first thing you probably noticed is that Asian cities dominate in farebox. American tend to be on the lower end of the spectrum, generally below 50%. Granted, there are scant few Asian cities listed here, but they all tend to be very high on the scale. Only Beijing falls below 100% farebox recovery on this list.

So, why is that? There are three main factors at play: density, land use, and mode of transportation. Asian cities tend to be much more dense than American, which naturally leads transit becoming more cost effective. Land use is also a factor in this: You are unlikely to find homes and places of business built around the car, nor are the cities dominated by acres of highway and parking lots. It is more difficult to get around by car, so people will travel with transit to avoid the hassle.

Finally, there's the mode of transportation: The Asian cities, Tokyo most famously, are based around rail transit, which scales extremely well with use. Many American cities, particularly those on the low end of the spectrum, are based around buses, which aren't nearly as cost effective (particularly when you run buses that are peak-commute oriented, which are very inefficient).

But I think the real question we need to be asking is this: Is it bad if a transit agency has less than 100% farebox recovery?

This is more of a philosophical question, and your answer may be different than mine depending on your viewpoint. My answer is no: while 100% farebox recovery would be nice, it is not a necessity, nor should it be a priority. You'll notice that no city on the list outside of Asia has reached 100%, so apparently it's very difficult for most cities to reach it.

That being, said, I do support certain policies that would lead to higher farebox recovery. Examples include building rail transit, buiding transit oriented development around areas served by frequent high-capacity transit, and going with driverless vehicles where possible.*

But I support these because they make transit more useful, and making transit more useful is generally what will lead to better performance and better farebox ratio.

We'll revisit this topic in the future. There's much more to say about it.

*You'll notice Vancouver's TransLink has a higher farebox ratio than Portland or Seattle. Part of this is lower operational cost of the SkyTrain, which uses driverless trains.

Thursday, July 25, 2013

We don't build transit just to reduce congestion

In my last post, I talked about how expanding highway capacity doesn't reduce congestion. The primary study I cited mentioned, in addition to this, that building transit doesn't reduce congestion either.

This is interesting because congestion reduction is one of the primary reasons given for expending transit when presented at the ballot. But if it doesn't actually reduce congestion, why do we even build transit?

The reason for that is simply because there are other, better reasons for building transit than reducing congestion. That is, in fact, a very car-centric reason for doing it, when by its very nature transit provides an alternative to cars. The mindset around transit needs not to be "this will benefit me because other people will use it" but "this will benefit me because I will use it."

A good transit system provides a way out of congestion, rather than a means of reducing it. The main pitch for transit needs to be this: It increases mobility. And increasing mobility is the best reason for supporting transit.

Monday, July 15, 2013

The Fundamental Law of Highway Congestion

The first topic I'd like to address on the blog is congestion. This is something we're quite familiar with in the Seattle area. Not a day goes by without a traffic backup somewhere. We are, after all, a city of chokepoints. There are only two north-south highways leading into downtown Seattle, I-5 and highway 99. Likewise, there are only two east-west highways leading in as well: state route 520 and I-90, both of which have bridges to cross Lake Washington.

Common sense dictates that if you don't have enough lanes of traffic to handle the number of vehicles passing through, all you need to do is increase the number of lanes of traffic. It's true that this does increase your capacity. But does it reduce congestion?

A 2009 study on the subject suggests that it doesn't, in a paper by researchers Gilles Duranton and Matthew A. Turner. They cite something called the Fundamental Law of Highway Congestion first suggested by Anthony Downs in 1962. Downs himself said the following (cited from this source):

[E]xpansion of road capacity – no matter how large, within the limits of feasibility –
cannot fully eliminate periods of crawling along on expressways at frustratingly low speeds.

Basically, there is only a certain amount of congestion that people are willing to tolerate. Where alternative modes of transportation exist - buses, rail, bicycle paths, and so forth - people will use those modes of transportation to avoid congestion. But the latent demand is still there. When road capacity is expanded, that latent demand fills up the new capacity rather quickly.

The study offers only one solution for congestion that is proven to be effective, and if you're a driver, you're not going to like it: congestion tolling. By charging a higher toll on highways based on when the most demand is there, people naturally find alternatives and congestion drops.

It's also worth noting that the first paper cited finds no relationship between the increase in the availability of public transportation and reducing congestion. This is interesting because reducing congestion is often used as a justification for creating transit. This all goes back to the fundamental law: if people start using transit and leave their cars at home, the latent demand for highway lanes will manifest itself and the congestion will keep at the same level it was at before. Ultimately, you are moving more people with transit than you are without. There are better reasons for building transit than claiming it will reduce congestion - that is probably the least important reason, even if it's true.

Here's a couple other articles that cite this study, for your reading pleasure:


The Atlantic

I'll revisit the topic of congestion, congestion pricing and the fundamental law in the near future. I'm hoping to go into more detail and look at a few case studies. In the meantime, the next big topic I will begin to cover will be where the funds for transit systems (buses in particular) are coming from.

Wednesday, July 10, 2013

A Question to Ask Ourselves

My first series of posts is going to involve an examination of freeway capacity. Right now I'm looking for good sources on the subject that I can cite.

Until then, here's something to ponder. I overheard somebody the other talking about voting against every transit measure, and then said "I don't want buses. I want roads!"

So, here's the question to ask ourselves: Where do you want to go in a car that you cannot currently go because there's not enough roads?

After thinking about that, change the question a bit: Where do you want to go on transit that you cannot currently go because there's not enough transit?

You may find the answers to these two questions are very different from each other. I can't think of anyplace I can't go in a car for the first question. But I can think of a lot of places for question number two.

Monday, July 8, 2013

Why Transit?

When I lived in my home town of Olympia, I drove to get most places. The only times I didn't drive were when traveling short distances. I prided myself on having found tricks to get around traffic when driving home from work.

Then I moved to Seattle, where I was working downtown. I knew there was no way I could afford to drive to work and pay for parking on an intern's salary, so I started taking the bus to save money. Before long I was no longer an intern, but I didn't stop using the bus. I was still saving money, and I realized there were other benefits to taking transit as well.

About 7 years after my arrival in Seattle, I'm as big a transit supporter as they come. I started this blog because I want to help people understand the benefits of using transit, and why we should support its expansion.

From my perspective, there are two primary reasons we should support transit.

First, because it is an effective means of moving a large number of people from place to place, particularly when at least one of those places is densely populated, like downtown Seattle - the largest job center in the state of Washington.

Second, because I believe that transit can improve peoples' lives. Saving money is just the beginning: there are other reasons, such as reduced stress, better health, and more liveable, human-scaled neighborhoods, which tend to arise from areas that are well-supported by transit.

All that being said, I do own a car and think that cars are an appropriate means of transportation for many trips (like my errands I ran the other day, for which there was no way I could have accomplished them on the bus). But I also think that our transportation infrastructure has been way too focused on cars, and that we need to shift our focus more toward transit if we really are going to build a city that's ready for our future growth.

My goal for this blog is to make the case for more transit infrastructure, and hopefully change a few minds on the subject of transit.