INVOLVING PRIVATE ROUTE ASSOCIATIONS IN PUBLIC TRANSIT

A number of federal grant programs initiated in the 1960s and 1970s allowed local governments to purchase the assets of failing private transit operators and establish public transit agencies. These policies led to rapidly increasing transit subsidies and declining productivity in the transit industry. Rapid increases in transit deficits have been attributed to rising labor costs per vehicle mile, reduced fare revenue per passenger, service expansion, energy costs, and declining usage. To halt rapid growth in transit deficits, policymakers must seek ways to stimulate alternative forms of public transport that operate at lower labor costs or higher revenues than current public transit services. It is suggested that the first step in seeking alternatives to current transit services should be to give private entities the opportunity to provide unsubsidized services wherever possible. This article discusses this topic in detail.