UC Irvine Institute of Transportation Studies

Demand for public transit services in most urban areas is increasingly concentrated in the peak period. However, peak period service is significantly more expensive to the transit agency than its other services and usually produces larger deficits. Faced with pressures to maintain or increase commuter services, yet also to control rapidly escalating deficits, transit agencies are in need of strategies which improve the cost-effectiveness of commuter transportation. Several innovative service strategies which make use of the private sector--service contracting, service turnovers, vanpooling-chave considerable potential to achieve this objective, and are alternatives to traditional transit agency approaches to problem solving.

Based on a study of 8 transit agencies in 8 diverse metropolitan areas, all with some significant private sector activity in commuter transportation, this paper examines transit agency utilization of these innovative private sector strategies. It determines the reasons these agencies have or have not adopted these strategies, and identifies the major barriers to their more widespread utilization. 

The initial incentive to consider non-traditional approaches comes from fiscal and/or service pressures which require some change in the status quo, but whether private sector strategies are actually utilized depends largely on four factors: 1) management interest in non-traditional approaches, 2) analyses which demonstrate the utility of innovative approaches, 3) discretionary rather than dedicated local subsidies, and 4) the ability of local government officials to influence the transit agency's service and budget decisions. The main barriers to innovation are traditional management orientation, labor constraints posed by federal legislation and/or local union contracts, and subsidy and decision making arrangements which give the agency no strong incentive to improve the cost-effectiveness of its different types of services.