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September 8, 2008

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NEWS HEADLINES

Soaring Ridership Challenges Transit Agencies

Dramatic increases in ridership have led to widespread capacity constraints on public transportation systems nationwide, according to a survey released this week by APTA, with more than half the respondents calling for federal financial support for fuel purchases.

The survey of 115 APTA members, representing approximately one-third of all APTA U.S. public transit agency members, clearly shows that transit systems across the country are severely challenged in their ability to meet surging ridership—now at its highest level in 50 years.  Increases in fuel prices, together with flat or declining state and local tax revenue, are making it very difficult for transit systems to add new service.  The study also reveals that agencies are actively seeking help to enable them to meet the public’s soaring demand for public transit services.

“Additional funding is clearly needed,” said APTA President William W. Millar,“ if our nation’s transit systems are to continue to provide more transportation choices for all Americans.”

Respondents included agencies operating all public transportation modes and are representative of a range of size:  About half operate more than 100 vehicles.

Nearly all agencies surveyed (86 percent) report increased ridership over the past year, ranging from 2 percent to 30 percent—with two thirds reporting increases during both peak and off-peak periods.  To address increased ridership, agencies have taken a variety of actions:  42 percent have increased service frequency on existing routes, 29 percent have expanded service into new geographic areas and 15 percent have reallocated service to higher ridership lines.  Some agencies are simply unable to take any action at all, making service cuts likely.

Increases in public transportation ridership over the past few years have also resulted in relatively widespread capacity constraints, with 85 percent of responding transit systems reporting capacity on at least portions of their systems. Six out of 10 (63 percent) of these  transit agencies are experiencing constraints during peak periods, half (49 percent)  report the problem on short segments of high ridership routes, and 13 percent are reaching their limits on numerous routes.

Although many agencies facing capacity constraints are simply unable to respond at all to capacity constraints at this time,  nearly half (48 percent) do report taking  action to add service by increasing the use of their existing fleet (79 percent), and in some cases, by purchasing new vehicles (29 percent).  Nevertheless, despite such efforts to meet the surging demand, more than half of the agencies (54 percent) still report allowing crowding beyond local service standards and 39 percent even report having to turn passengers away.

Virtually all agencies (91 percent) are constrained in their ability to add service to meet increased ridership levels.  The most common limitation is budgetary, with two-thirds of these agencies reporting insufficient revenue to operate additional service.  One-third of the responding agencies do not have vehicles available to add service. 

To make matters even worse, in the face of spiraling fuel prices and surging ridership levels,  many agencies are also facing limited available resources from state and local sources.  In fact, more than half (58 percent) of all agencies report either stable or declining  local and state resources over the past year, resulting in part from declining property values and  lower sales tax revenues—two additional trends not likely to improve any time soon.

So what’s a transit agency to do?   Respondents to this study cited a number of significant actions to address the negative impact of spiraling fuel costs, with more than 60 percent considering a fare increase or fuel surcharge, 50 percent seeking increases in state and local contributions, and 30 percent looking towards new dedicated funding such as new local taxes. 
Other more troubling options include postponing or canceling operating improvements, delaying or canceling planned service increases, or cutting service completely—all options cited by more than 30 percent of respondents—and certainly not welcome news in a time of soaring ridership demand.

Virtually all agencies believe that federal action is essential and are also looking to the federal government for critical assistance.  More than half of the respondents (56 percent) believe the most effective short-term federal action would be new federal financial support for fuel purchases.  Agencies also recognize the need for additional capital support, with 20 percent citing a preference for increased federal capital investment to add new transit vehicles.  Thirteen percent would opt for a more dramatic action:  changing the current law to allow existing federal funds to be used for fuel purchases.  The implication of this response is that agencies are facing the most immediate challenge within operating budgets as they attempt to meet surging demand, and need the flexibility to move money in and out of fixed categories.

Skyrocketing fuel prices are forcing transit systems to reevaluate their operations in major ways.  As this study indicates, agencies need assistance as they attempt to meet the surging ridership demand while still protecting existing service.  

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