PERFORMANCE-BASED FUNDING-ALLOCATION GUIDELINES FOR TRANSIT OPERATORS IN LOS ANGELES COUNTY

During the last five years, transit performance indicators have been widely used in the transit industry. California and New York have used performance indicators to determine eligibility for funding. In Pennsylvania, transit performance measures have been used to provide incentive payments for superior performance, and in Michigan a detailed analysis of transit operations provides the basis for state managerial assistance. In Los Angeles County, nine transit operators, including Southern California Rapid Transit District, provide fixed-route transit service. Between 1977 and 1980, operating cost per vehicle hour increased from $28.52 to $38.76, a rate higher than the consumer price index for the Los Angeles area. In response to state legislation designed to maximize utilization of public subsidies for transit, the Los Angeles County Transportation Commission undertook the development of performance-based guidelines for allocating transit subsidies. The performance guidelines developed in cooperation with the local transit operators are presented here. In this program, service is classified into local and express categories. Seven indicators were chosen to monitor transit performance on a periodic basis. Three indicators were selected to establish standards to be achieved by all fixed-route service operators in Los Angeles County. Compliance with these standards will determine eligibility for discretionary funds (representing 5 percent of operating assistance) in the future. The methodology for quantifying loss of subsidy funds if an operator falls below the established standards is also described. The performance guidelines merit consideration for two reasons. First, they represent an attempt by a large metropolitan area to control transit costs, and second they initiate performance-based funding allocation rather than funding based on demographic characteristics or operating deficits. Both reasons are substantial advancements in the theory and application of performance-based guidelines to transit-financing issues.