When Transit Service is Substandard, Can we Plan for Capital Expansion?

» New Orleans fantasizes about new streetcar routes as its buses barely make the grade. Public transportation expenditures are typically divided into two buckets: One for operations expenditures — the money that goes primarily to pay the costs of gas, electricity, and driver labor — and the other for capital investments, which sometimes means maintenance but often means new vehicles and system expansions. Because of the way in which these two buckets are funded, a transit agency that may be in dire straights in terms of paying for system expansions may be providing excellent, well-funded daily services. Or the opposite could be true. This is a consequence of the fact that federal transportation grant support, and also often local system revenues, are required to be spent in one of the two areas, with little ability to transfer funds between them. The division between capital and operations funding produces some strange dynamics and perverse incentives for transit agencies, and the results are not always ideal for the typical rider. Take the example of New Orleans. Before Hurricane Katrina, New Orleans was one of the most transit-reliant cities in the country, with more daily rides per capita on its transit system than Philadelphia, Seattle, Baltimore, or Portland. Of commuters, 14% took transit to work on an average weekday in 2000. By 2010, the figures had been slashed; just 7.5% of commuters took transit to work, according to the Census. The following map shows that this change occurred across the city.