Question-2. How is the bus system working out?
ANS-2. Preliminary reporting indicates that ridership and revenues are lower than anticipated, in some cases by as much as 50%. The Council will be given a comprehensive update at the 12 December workshop. Recall that we established system-wide and route-specific performance criteria, and stated that if system performance on any one criteria was 50% short of the goal, or if 50% of all the performance criteria were not being fully met, the program would be brought back to Council for reconsideration. The 12 December report is the first window to see how things are working. I expect the Council to be mindful of the performance criteria, but in the context that the system is in its early phases. I will relay the performance report in this newsletter.
It turns out that this is not just a local issue. Randal O"Toole of the CATO institute has just released his latest policy paper on public transit. Here is the executive summary:
With annual subsidies of $50 billion covering 76 percent of its costs, public transit may be the most heavily subsidized consumer-based industry in the country. Since 1970, the industry has received well over $1 trillion (adjusted for inflation) in subsidies, yet the number of transit trips taken by the average urban resident has declined from about 50 per year in 1970 to 39 per year today.
Total transit ridership, not just per capita, is declining today, having seen a 4.4 percent drop nationwide from 2014 to 2016 and a 3.0 percent drop in the first seven months of 2017 versus the same months of 2016. Many major transit systems have suffered catastrophic declines in the past few years: since 2009, for example, transit ridership has declined by 27 to 37 percent in the Bakersfield, Detroit, Fresno, Memphis, Richmond, Toledo, and Wichita urban areas.
Four trends that are likely to become even more pronounced in the future place the entire industry in jeopardy: low energy prices; growing maintenance backlogs, especially for rail transit systems; unfunded pension and health care obligations; and ride-hailing services.
The last is the most serious threat, as some predict that within five years those ride-hailing services will begin using driverless cars, which will reduce their fares to rates competitive with transit, but with far more convenient service. This makes it likely that outside of a few very dense areas, such as New York City, transit will be extinct by the year 2030, leaving behind a huge burden of debt and unfunded obligations to former transit employees.
Despite these trends, the transit industry’s main response is to seek greater subsidies to build, maintain, and operate transit, often relying on rail transit and similar modes that were obsolete many years ago and won’t be able to compete against driverless ride-hailing services. Instead, transit agencies should begin to prepare for an orderly phase-out of publicly funded transit services as affordable, shared driverless cars become available in the next decade. This means the industry should stop building new rail lines; replace most existing rail lines with buses as they wear out; pay down debts and unfunded obligations; and target any further subsidies to low-income people rather than continue a futile crusade to attract higher-income people out of their cars.
Given the likely changes occurring in the near future as outlined above, Georgetown should not be committing to traditional long-term public transit and its associated legacy costs. Georgetown has the opportunity to avoid a long-term financial problem by shutting down the trial bus system before long-term commitments are made.
I understand that Sgt Brown has settled her Federal Lawsuit with the City. You might want to research that.
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