ISSUES IN CONTRACTING FOR PUBLIC TRANSPORTATION SERVICE

Public agencies in the United States have been contracting with private transportation providers to operate public transportation service since the early 1970s. Today, transit service contracting is a well-established practice among local governments, and in many communities represents the only way in which public transportation has ever been provided. This article describes the federal policy on competitive contracting which was established by the FTA Private Enterprise Participation Policy, issued in 1984. The three objectives of this policy are discussed: 1) compliance with legislative mandates; 2) containment of escalating transit operating defficits; and 3) improved ability to respond to changing market demands.