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Gas Prices + Public Transport

As you read this, imagine how different our mass transit system would look, and by extension how different our country would look, if we had used the period of cheap energy in the 1980s and 1990s to gradually raise the gas tax to levels that impact individual behavior. Rather than having the nation shift all at once onto a mass transit system that is woefully underdeveloped, we could have gradually weaned ourselves from our dependence on cars. You know, like the rest of the advanced industrialized world...

DENVER -- With the price of gas approaching $4 a gallon, more commuters are abandoning their cars and taking the train or bus instead.


Mass transit systems around the country are seeing standing-room-only crowds on bus lines where seats were once easy to come by. Parking lots at many bus and light rail stations are suddenly overflowing, with commuters in some towns risking a ticket or tow by parking on nearby grassy areas and in vacant lots.

"In almost every transit system I talk to, we're seeing very high rates of growth the last few months," said William W. Millar, president of the American Public Transportation Association.

"It's very clear that a significant portion of the increase in transit use is directly caused by people who are looking for alternatives to paying $3.50 a gallon for gas."

Some cities with long-established public transit systems, like New York and Boston, have seen increases in ridership of 5 percent or more so far this year. But the biggest surges -- of 10 to 15 percent or more over last year -- are occurring in many metropolitan areas in the South and West where the driving culture is strongest and bus and rail lines are more limited.

Here in Denver, for example, ridership was up 8 percent in the first three months of the year compared with last year, despite a fare increase in January and a slowing economy, which usually means fewer commuters. Several routes on the system have reached capacity, particularly at rush hour, for the first time.

"We are at a tipping point," said Clarence W. Marsella, chief executive of the Denver Regional Transportation District, referring to gasoline prices.

Transit systems in metropolitan areas like Minneapolis, Seattle, Dallas-Fort Worth and San Francisco reported similar jumps. In cities like Houston, Nashville, Salt Lake City, and Charlotte, N.C., commuters in growing numbers are taking advantage of new bus and train lines built or expanded in the last few years. The American Public Transportation Association reports that localities with fewer than 100,000 people have also experienced large increases in bus ridership.

In New York, the Metropolitan Transportation Authority reports that ridership was up the first three months of the year by more than 5 percent on the Long Island Rail Road and the Metro-North Railroad, while M.T.A. bus ridership was up 10.9 percent. New York City subway use was up 6.8 percent for January and February. Ridership on New Jersey Transit trains was up more than 5 percent for the first three months of the year.

The increase in transit use coincides with other signs that American motorists are beginning to change their driving habits, including buying smaller vehicles. The Energy Department recently predicted that Americans would consume slightly less gasoline this year than last -- for the first yearly decline since 1991.

Oil prices broke yet another record on Friday, climbing $2.27, to $125.96 a barrel. The national average for regular unleaded gasoline reached $3.67 a gallon, up from $3.04 a year ago, according to AAA.

But meeting the greater demand for mass transit is proving difficult. The cost of fuel and power for public transportation is about three times that of four years ago, and the slowing economy means local sales tax receipts are down, so there is less money available for transit services. Higher steel prices are making planned expansions more expensive.

Typically, mass transit systems rely on fares to cover about a third of their costs, so they depend on sales taxes and other government funding. Few states use gas tax revenue for mass transit.

In Denver, transportation officials expected to pay $2.62 a gallon for diesel this year, but they are now paying $3.20. Every penny increase costs the Denver Regional Transportation District an extra $100,000 a year. And it is bracing for a $19 million shortfall in sales taxes this year from original projections.

"I'd like to put more buses on the street," Mr. Marsella said. "I can't expand service as much as I'd like to."

Average annual growth from sales tax revenue for the Bay Area Rapid Transit District, a rail service that connects San Francisco with Oakland, has been 4.5 percent over the last 15 years. It expects that to fall to 2 percent this year, and electricity costs are rising.

UPDATE: The Internet's Matthew Yglesias comments:

What happens next? What really shouldn't happen is for politicians to run around talking as if expensive gasoline is a temporary phenomenon. Responsible leaders will tell people that prices will fluctuate, but that as long as the Chinese and Indian economies keep growing, the general trajectory will be upward. Then they should sympathize with people who would like to take transit, but find it prohibitively inconvenient and with people who've just started taking transit and are finding it annoying and they should commit to making transit better and more available.


Alternatively, you could act like southern Florida and propose steep service reductions on your commuter rail system. But that'd be crazy. Jurisdictions with existing commuter rail lines need to make service more frequent. With transit, you can get into good equilibria and bad equilibria. On the good path, you have tons and tons of people who want to ride your line and as a result service is very frequent so as to accommodate all the traffic. And because service is so frequent, lots of people find the line convenient to use. On the bad path, infrequent service leads to low ridership which leads to infrequent service which leads to low ridership.

The idea of multiple equilibrium points is key here. Far too often, critics of mass transit point to low ridership numbers and conclude that people simply aren't interested in taking mass transit. But of course that's not necessarily what those numbers mean at all. Without any more information, the most you can say is that they do not want to take mass transit as it is currently configured. Make it more frequent, more convenient, more pleasant to use, and more cost effective, and its entirely possible that you would see a huge surge in use. Over the past few months, we've seen only one of those 4 things shift, and already people are beginning to change their behavior.

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