Can Transit Agencies Learn to Embrace Car Ownership?

and John A. Charles, Jr.

Most public transit agencies have some bus routes that are very low performing. Generally, these lines serve low-density suburban or rural neighborhoods, where few prospective riders live and service costs are high. The subsidies per ride on such routes are frequently $10 or more.

However, agencies find it difficult to eliminate low-ridership lines for a number of reasons. One is that management may appear ruthless if they appear to leave transit-dependent riders without mobility options. Another is that transit agencies are subsidized by taxpayers, so agencies feel political pressure to provide services to areas where their subsidies are generated through taxation, even if there are few riders there.

The largest transit agency in Oregon is TriMet, serving the Portland metro area. TriMet’s average passenger fare per ride is $0.88, while the average system cost per ride is $3.07. However, more than 20 bus lines have costs above $5.00 per ride, and several are above $10. Clearly taxpayers (who subsidize TriMet with over $200 million annually in payroll taxes) would benefit by eliminating some of these routes so that funds could be reallocated to lines that are overcrowded.

In August 2007, Cascade Policy Institute submitted an innovative proposal to TriMet addressing this problem. Our proposal was to cancel TriMet’s lowest performing bus routes and to use some of the savings to capitalize a loan fund to help finance car ownership for transit-dependent riders displaced by the bus line cancellations.

Why focus on car ownership? Because research shows that having a car dramatically increases the likelihood that someone will find a job, hold onto it, and move up the economic ladder. Most work sites outside downtown Portland are not well served by transit and never will be. Auto ownership would open up a whole new world of employment possibilities to these workers. Car ownership also makes day-to-day living much smoother, especially for parents juggling the logistics of childcare and employment.

Cascade’s proposal suggested that TriMet conduct this plan as a pilot program for a designated period of time. If TriMet eliminated the five worst performing bus lines, they would save roughly $1.1 million per year in operating costs, while displacing only about 265 riders. Some fraction of those riders could become car owners if offered a no-interest or low-interest loan, and the amount of money necessary to finance such loans would be relatively small (perhaps $4,000 per person).

No one knows how many people would be able to take advantage of a loan. Some riders might not have a driver’s license, while others might be incapable of paying off a loan under any terms; but this is part of what we would learn from the pilot program.

If 150 individuals accepted loans in the first year, roughly $600,000 of the $1.1 million in savings would be needed to capitalize the fund. But in the second year, TriMet would continue to save over a million dollars. Most of that would go into the agency’s bottom line because the loan fund would be getting paid back. Over the long term, even assuming an increasing number of loans, TriMet would save many millions of dollars.

Unfortunately, our proposal was rejected. In fact, TriMet did not even read it very closely. The agency’s representative criticized what he believed to be Cascade’s idea of “giving away” cars; our proposal was for a loan program.

TriMet apparently has difficulty understanding how a transit agency can be both pro-car and pro-transit at the same time. But the agency’s own expenditure program shows that transit is dependent on private car ownership. TriMet’s most expensive capital program, building light rail, relies on free park-and-rides for motorists who must first travel in a private auto. In fact, without widespread car ownership, TriMet would have almost no train riders.

This was highlighted in a recent Oregonian story. The writer noted that TriMet operates many parking lots along its light rail lines, and those lots closest to downtown Portland are vastly over-subscribed. A TriMet spokesperson urged people to leave their cars at home, but clearly this is unrealistic.

Some transit agencies do understand the benefits of car ownership. A representative of the Denver transit agency (which also operates light rail lines) told The Oregonian, “Cars are our friend.”

Cancelling five or six bus routes serving fewer than 300 people per week and putting some of the savings into subsidized car ownership would be enormously beneficial to the loan recipients, and still would promote TriMet’s broader mobility goals. In fact, it is possible that some low-income bus riders might be able to find higher-paying work elsewhere if they owned a car and become train riders in the process.

More than 150 private car-ownership programs already exist around the country (including two in Oregon). These programs have demonstrated an extraordinary level of effectiveness at helping people become more self-reliant through increased employment opportunities. Adding another program through TriMet, from a revenue stream that already exists, would benefit everyone.

But TriMet management isn’t interested. They have their clichéd story, and they are sticking with it: “Buses good, cars bad.”

Taxpayers deserve better.


Sreya Sarkar is Director of the Asset Ownership Project and John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research center.

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  • dean

    Sreya…believe it or not some people just do not drive. Some are too young, others get older and lose capability, as was the case with my mother. Buying these people a car would not help them unless you also provided a driver, in which case you might as well just keep the subsidized bus service.

    • billy

      For those who cannot drive and cannot afford a taxi, , it would probably be cheaper to provide taxi fare. Or allow jitney service and pay their jitney fare.

      And they would get a door to door trip free of waiting in the rain, waiting in crime infested neighborhoods (oops – thats mainly MAX), drug dealers and the like.

      Why don’t we allow jitneys to compete with TriMets’s monopoly?

  • Joanne Rigutto

    I’ve worked construction full time since 1984, and all of the people I’ve known working in the trades who took public transportation were doing so because they lost their license, usually due to one or more DUIIs or failure to cary insurance. I don’t think that helping them get a car would help. And then, there are the people who don’t make enough money to pay for insurance. Helping them get a car won’t do much good either.

    Dean’s right, some people just aren’t able to drive, financially well enough off to afford a vehicle of their own, etc.

    Billy’s also right. It would probably be cheaper to pay taxi fare or allow jitneys and pay for that. Although, considering what a taxi costs now days, perhaps $10/ride for a bus trip isn’t so bad after all….

  • Sreya

    Dean, Billy and Joanne,

    Thanks for your comments.
    The W2W Car loans are meant only for those who can drive ofcoarse, but we had discussed a second part of the proposal which mentioned jitneys and how useful they could be for low-income riders.

    I had proposed that by using a revolving car loan program like the one discussed by our W2W project, some low-income drivers could get bigger cars and use them as jitneys with all the proper safety requirements (insurance, license etc.) This is the link to a related commentary:
    https://www.cascadepolicy.org/2007/12/20/a-market-based-solution/

    Some TriMet and Metro officials liked the idea but nobody was willing to take real action or initiative. Cascade is proposing a legislative concept of de-regulating the taxi industries coming year. Let’s see how many of those truly concerned support it.

    • dean

      Sreya….does “deregulation” mean lack of insurance for carrying paying passengers, lack of driver certification, and lack of vehicle safety certification?

      Also….why not buy people bicycles or even mopeds instead of cars? Way cheaper.

      Bottom line, I think it is great the Cascade is willing to put constructive transit solutions out there. But it seems the same solutions…i.e. jitneys…keep being repackaged, rejected, and repackaged again. Maybe it is time for different idea?

  • Sreya

    Dean,

    ‘Deregulation’ does not mean lack of deregulation and all that. Please try to read my comments closely.

    And, I don’t think bikes can really ever replace cars, not when you need to travel 10 or more miles up and down.

    Jitneys, packaged and repackaged-that’s right! That idea keeps coming back because its a good idea.

    What ideas do you have that are more innovative?

    First, you were against cars and now you are against jitneys???

    Now, I will come up with a third idea and you will be against it. I really don’t get you Dean.

  • Sreya

    Sorry for the typo, I meant deregulation does not mean lack of insurance etc.

    • dean

      OK…so what “regulation” would continue, and what would be done away with in your proposal?

      I agree bikes are not for everyone, though 10 miles is quite doable for many and only takes an hour at a leisurely pace. I did a 13 mile 1-way bike commute for many years. Also, note that according to the Oregonian today, bike use doubled in Portland this summer, and bikes are almost as numerous as cars on the Hawthorne Bridge.

      I’m not dead set against “jitneys.” They are important in the 3rd world.

      • Sreya

        There are already several programs and dedicated funding for bikes.

        And, what makes you think jitneys are not good for PDX? There were once more than 300 jitneys operating in Portland and they were very popular with factory workers.

        Most people owning bikes also own cars. This fact came up last year in a car vs. bike debate. Infact, the participants promoting bikes also had cars (in fact 2 cars). It was funny that I was the only person maybe in that room who did not own a car because I wanted to experience what it is like not to have a car since I was promoting Wheels to Wealth.

        But, let me remind you, that you are wondering away from the main point which is cars are important to low-income workers who work hard balancing work and home. There is empirical evidence supporting that.

        Bike vs. Car is an attractive debate but not a sensible one for the income group I am talking about.

        • dean

          Sreya…its nice to finally find a demographic I fit into. I own 2 cars and a bike! And I use all 3 plus mass transit at various times and places.

          OK…so Portland used to have jitneys. It also used to have horses and buggies. I have not yet heard a coherent argument for why jitneys are at present a good idea, how these would be regulated and by whom, and how they would be economical if they are confined to low ridership routes. My understanding of jitneys, which I define as informal, private, unregulated or lightly regulated passenger service vehicles, is that they tend to focus on high traffic routes, not low ones. In other words they high grade. Also, you still offered no explanation on what regulation they would be subject to. Safety inspections? Chauffer’s license? Adequate insurance? Drug testing? Log books?

          There are many types of low income workers. In today’s economy I would guess the majority are in the service trades, primarily retail. Many if not most are also probably young. I don’t see much reason they can’t bike to and from work providing that the community designs its streets and intersections to be safe. Granted winter time riding takes supplemental equipment and higher skill, but lots of people do it, and at 56 cents a mile cost saved (car operational cost) it is the most economical form of transport available. Not to mention the exercise benefits.

          Anyway…I’m not arguing completely against cars. For some people they are the only practical option. I’m just pointing to your initial premise that it would be less expensive for the government to provide cars to people than to provide low ridership bus service. If 50% of those affected could ride a bike, then you could cut your costs even further.

          • Anonymous

            “Sreya…its nice to finally find a demographic I fit into. I own 2 cars and a bike! And I use all 3 plus mass transit at various times and places.”

            No one cares, dean.

            “OK…so Portland used to have jitneys. It also used to have horses and buggies.”

            So what. Bikes are 19th century too. According to your logic, that’s a bad thing – unless, of course YOU think it’s good.

            “I have not yet heard a coherent argument for why jitneys are at present a good idea…”

            You haven’t heasd a coherent argument because you’re too busy talking BS – even if you did accidentally overhear one, it wouldn’t register on your closed mind.

            “My understanding of jitneys, which I define as informal, private, unregulated or lightly regulated passenger service vehicles, is that they tend to focus on high traffic routes, not low ones.”

            Well, dean, as long as you define the terms, why don’t you just argue with yourself in private and spare us your verbal effluent.

            “Also, you still offered no explanation on what regulation they would be subject to. Safety inspections? Chauffer’s license? Adequate insurance? Drug testing? Log books?”

            Oh, my, dean! You mean you don’t recognize the difference between an idea and a fully formed proposal? Yet you attack the idea for not being a proposal?

            How very disingenously deanlike.

            It’s always heartwarming to see you looking out for the safety of others through regulation. That’s what you’re doing, isn’t it?

            Not really, just looking out for your union buddies’ and their puppetmasters’ job security at Tri-Met and Metro. If you’re so worried about safety, what’s with your bicycle recommendation? I’m quite sure the injury rate per mile traveled and the severity per injury is far worse on bikes. It’s a miracle YOU haven’t been killed!

            …and I mean that in the nicest possible way.

            “Granted winter time riding takes supplemental equipment and higher skill, but lots of people do it, and at 56 cents a mile cost saved (car operational cost) it is the most economical form of transport available. Not to mention the exercise benefits.”

            “…lots of people do it…”

            How many is “lots” dean – where are your stats? “Lots of people” do “lots” of things, but that doesn’t qualify as a reason to do what they do. Lots MORE, VASTLY more, people drive than bike or use *mess* transit – does that mean MORE people should – I like your logic!

            “…and at 56 cents a mile cost saved (car operational cost) it is the most economical form of transport available.”

            What, more economical than walking?!? Another bogus generalization which assumes that one’s time is valueless. It also disregards the cost to others for the congestion, bike paths, special lanes, bike boxes, striping and all the myriad “adjustments” and taxes imposed on drivers. Many bike riders are NOT commuting and are therefore simply getting a free ride (tee-hee). All of them use these resources without any direct user fees – you know, like bicyclist’s licenses, adequate insurance, safety inspections, equipment requirements, drug testing. The “chosen’ are immune.

            The whole bike argument is a red herring, bikes are, by definition, NOT mass transit. The subject at hand is wise use of taxpayer dollars and, as usual, dean doesn’t want to talk about that.

            He’s too busy collecting them in pension and through tax breaks to help subsidize his vast agricultural enterprise (read hay field) in Damascus.

          • dean

            Whoever you are….yes bicycles are 19th century, as are cars and trains. But these are also contemporary transportation choices, while jitneys and horses, at least in Portland, are not.

            If one suggests jitneys would be “regulated,” yet argues for these as part of a de-regulatory option, then one should be able to explain what one means by suggesting regulation. Something either is or is not regulated, and if it is then there must be some aspects of it that are. What are they?

            How many are “lots?” According to the Portland Department of Transportation (hey…must be liberals. What to THEY know?)…8% of all Portland workers now use bikes as their *primary* means to get to and from work. It was 6% in 2007, and 3% in 1997. 10% list cycling as their *secondary* method to get to work. So the total using bikes to get to work some or all the time is 18%. 16,000 bikes cross Portland’s 4 main bridges per day, up 15% from just last year. City wide bike traffic has increased 190% this decade.

            Yes…biking is more economical than walking if one factors in time. And for many, biking is WAY more economical then driving factoring in time. At a 25MPH driving speed (typical for inner city driving) and factoring in stoplights your actual speed is about 10 MPH. If you bike the same streets at 10MPH your actual speed, factoring in lights and such is 8.9 MPH. FActor in time spent finding a parking place versus a bike lock and you are even or ahead by cycling on time. And this leaves out the time it takes to earn the money to buy a car versus a bike.

            There is a reason Portlanders are “voting with their legs” so to speak. City government is making cycling easier and safer, and more people are taking advantage if this.

          • Joanne Rigutto

            OK Dean, you have a demographic, now I’m lookin’ fer mine…

            “2 pickups and a mare”.

            If we could jest get them thar trails built I could throw a couple of saddle bags on Melora and go to Safeway (Molalla) in style – Melora’s a Lipizzan…. Dancin’ white horeses of Vienna and all that….

            Just kidding, although I would like to ride to the store. Thought I’d lighten things up a bit.

          • dean

            And thanks for that.

  • Rupert in Springfield

    How about this as a concept – If you lost your license, cant be bothered to learn how to drive or cannot afford a car you will be inconvenienced.

    How about the novel concept that if you are too old to drive it just might be easier for you to move rather than everyone else subsidize some nitwit bus line with three riders a day to God knows where you live.

    How about the amazing idea that maybe at some point those seeking free stuff from the rest of us should be told “No, you know what, you are going to have to make changes to your life, everyone is not going to “pitch in” to help you get around just so you can continue in as you were”

    That would be true change. That would be change I could believe in.

    But no, what we get is more of the same old tired way of doing business. Raising taxes on the productive so the parasitic will not be inconvenienced.

    The bottom line is YOU ARE BEING GIVEN A CAR YOU STUPID IDIOT.

    Don’t know how to drive? Learn.

    Too young to drive? Sell the car, get a bike and use the balance for bike riding lessons.

    Too old to drive or too far to ride your bike? Move closer or exercise more.

    Don’t like any of those? Stay home.

    But that’s not a solution Rupert, that’s merely avoiding the problem.

    Who cares, no one seems to ever be brimming with solutions for me when I am sitting there trying to pay my quarterlies to pay for all this nonsense.

    I’ve even tried, I’ve called up the OR Department of Revenue and asked if there is a special program for me to assist me in paying my taxes. I get a lot of laughter on the other end at that one. I suggest the same approach be used with these idiots who seem to not be able to figure out how to use toilet paper and think everyone around them owes them endless solutions to every little problem they encounter in life.

    No, I don’t see how society is proportionally helped by subsidizing some kid to the tune of $4,000 annually (1.1 mil / 256 ) for bus fare.

    No, I don’t see why its selfish to say taxpayers are entitled to hold on to $4,000 and granny is just going to have to move closer to a real bus line.

    Wow, $4,000 per person. Sorry, no one is worth that much and Id have no problem saying that to these people. My 7 year old, 9 year old and my wife call me Daddy and that’s all I feel I am compelled to answer too when called by that name. The fact that you are an interestingly clothed person in a dimly lit bar, or a stupid idiot who makes life choices with the same maturity level as my children does not compel me to answer to you with the same compassion I show to my kids. Learn from it.

    Gee, I’m so heartless.

    You want my solution that I would have proposed to Tri Met?

    I’d group every area that is subsidizing this nonsense into three house groups. Three property owners who probably have property tax bills around $1,300 annually. That sounds like a good average figure and I just made it up. Three times $1,300 is close enough to $4,000 for me.

    Id then send them a picture of one of those 256 idiots they are subsidizing. Id call it “Sponsor an Idiot”. Id list them, as well as their two neighbors on the picture. That way they could all feel some sort of connection both with each other, and the idiot they are subsidizing. They could sit and think about it.

    “Hmmmm, $1,300, that’s my whole property tax bill…….hmmmm…..that’s a nice new flat screen TV………hmmmm that’s kind of like a weeks wages……Geee, I feel so good that I am spending all that money so this idiot doesn’t have to pay full fare, I mean people who cant drive tend to be real productive members of society, we need to subsidize these great minds…..I’m so glad I’m pitching in and working that extra week a year so they can pay $1 instead of $10.”

    I think this sort of thing would foster a real sense of community. People would have a greater sense that their taxes are being used for really good programs. I think “Sponsor an Idiot” would also foster a spirit of gratitude from the recipients of such largess. Maybe the sponsored idiots could be sent a picture of their benefactors?

    “Wow, I am a stupid idiot who cant pay for my own bus fare, but look, the Marshells, the Smiths and the Robinsons all worked an extra week a year just so I wouldnt have to pay it. Thank you all, and thank you Sponsor an Idiot program!””

    Either way its win win, people decide they don’t want to sponsor an idiot and they therefore get the equivalent of a whole weeks extra wages, or flat screen TV, or the program continues, and everyone feels a greater sense of community.