Cato Institute disputes case for more transit funding

The conservative Cato Institute is disputing an argument being advanced by public transportation supporters that ridership increases prove Americans wants more funding for transit systems.

The American Public Transportation Association (APTA) reported this week that transit ridership in the U.S. reached its highest levels last year since 1956, with 10.7 billion people taking trips in 2013.

The transit association said the ridership jump signified a boost in interest in public transportation, and should compel Congress to provide money more for such systems.

However, Cato Institute Senior Fellow Randal O’Toole said on Wednesday that the transit ridership numbers were misleading because most of the increase came from urban areas.

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“The American Public Transportation Association argues that a 0.7 percent increase in annual transit ridership in 2013 is proof that Americans want more ‘investments’ in transit–by which the group means more federal funding.  However, a close look at the actual data reveals something entirely different,” O’Toole wrote in a blog post on the Cato website.

“It turns out that all of the increase in transit ridership took place in New York City,” O’Toole continued. “New York City subway and bus ridership grew by 120 million trips in 2013; nationally, transit ridership grew by just 115 million trips. Add in New York commuter trains (Long Island Railroad and Metro North) and New York City transit ridership grew by 123 million trips, which means transit in the rest of the nation declined by 8 million trips.”

The transit association said in its report this week that there were ridership increases across all potential modes of public transportation, including a 2.8 percent jump nationwide in the use of “heavy rail” subway systems like the New York subway system and Washington, D.C.’s Metrorail.

APTA also cited a 2.1 increase in ridership in commuter railways like New York’s Long Island Railroad and Metro-North and a 1.6 percent increase in light rail and streetcar ridership.

O’Toole said Wednesday that much of the growth in transit ridership outside of New York City came at the expense of bus systems, not through the creation of new riders.

“Light-rail ridership grew in Dallas by about 300,000 trips, but bus ridership declined by 1.7 million trips,” O’Toole wrote. “Charlotte light rail gained 27,000 new rides in 2013, but Charlotte buses lost 476,000 rides. Declines in bus ridership offset part or all of the gains in rail ridership in Chicago, Denver, Salt Lake City, and other cities. Rail ridership declined in Albuquerque, Baltimore, Minneapolis, Sacramento, and on the San Francisco BART system, among other places.”

APTA President Michael Melaniphy painted a starkly different picture than the Cato Institute this week, arguing that the increase in transit use was due to a sea change in the way Americans are getting themselves around.

“There is a fundamental shift going on in the way we move about our communities,” Melaniphy said in a statement when the ridership report was issued. “People in record numbers are demanding more public transit services and communities are benefiting with strong economic growth.”

Melaniphy said Congress should respond to the transit ridership jump by increasing the amount of funding it provides to public transportation systems.

“Community leaders know that public transportation investment drives community growth and economic revitalization,” the APTA chief said. “The federal investment in public transit is paying off and that is why Congress needs to act this year to pass a new transportation bill.” 

Approximately 20 percent of the revenue that is collected from the 18.4 cents per gallon gas tax is currently used to pay for public transportation projects.

The federal government established the set aside – and a Mass Transit Account within the Department of Transportation’s Highway Trust Fund – in the 1980s.

O’Toole said the amount of money that goes to public transportation does not need to be increased, however.

“APTA wants more federal funding because many of its associate members are rail contractors who depend on federal grants to build obsolete transit systems,” he wrote. “Light-rail lines being planned or built today cost an average of more than $100 million per mile, while some cities have built new four-lane freeways for $10 million to $20 million per mile, and each of those freeway lanes will move far more people per day than a light-rail line.”

O’Toole said transit systems should be forced to pay for more of their operations with revenue collected by the fares that are paid by their passengers.

“The real problem with our transportation system is not a shortage of funds, but too much money being spent in the wrong places,” he wrote. “New York City transit was the only major transit system in the country that covered more than half its operating costs out of fares in 2012; the average elsewhere was less than 30 percent.

“Funding transportation out of user fees, such as mileage-based user fees and transit fares, would give transportation agencies incentives to spend the money where it is needed by transport users, not where it will create the most pork for politicians,” O’Toole concluded.