How to save on public transportation — don't cut the budget

In coming to a budget agreement, Minnesota legislators debated how to close the $5 billion budget gap. The dispute boiled down to the central schism between the two parties: DFLers want to generate new revenue by raising taxes on the wealthy and Republicans believe that cutting government services, including transportation, is the only way to balance the budget. A close examination of the costs of cutting public transit reveals that there are actually cost savings to be had by not cutting the budget.

Metro Transit has a $375 million yearly operating budget. In 2010, those funds provided for 78 million rides, and they are on track to increase that number by at least three percent for 2011. Metro Transit’s funding comes from multiple sources, including user fares, the motor vehicle sales tax, and the State of Minnesota. The state’s general fund provided about 17 percent of the total budget. The budget that was finally passed cut $51 million, less than the original draconian cut of $110 million, but still large enough to cause significant job layoffs and ridership loss.

The originally-proposed cuts sparked outrage among the transit-riding population. During a July public transit meeting, many individuals told fraught personal stories about how they rely on Metro Transit buses and rail to take them to and from work. Translated from dollars and cents into human terms, these cuts directly affect the quality of life and economic well-being of many Twin Cities residents, including many of the most vulnerable citizens, such as the disabled and the poor. Although funding for Metro Transit is not directly related to Gov. Dayton’s Republican-blocked attempt to raise taxes on the wealthiest two percent of Minnesotans, any mention of raising taxes on the wealthiest prompted a cheer from the crowd. In a society that is typically silent regarding the growing gap between the rich and poor, there was a clear sense of collective anger at the politicians for protecting the interests of the wealthy minority.

Implementing service cuts causes a particular dilemma for Metropolitan Council transportation planners who have to balance overall costs with concerns for social justice.  In order to keep some of the late-night buses, often used by lower-income commuters with non-traditional work schedules, they might have to pull some peak commuter buses from the park-and-ride system. These buses often operate with only low subsidies, because they usually are full. Although these suburb to downtown routes are typically used by richer commuters who could drive to work if need be, an increase in driving would create more traffic, more pollution, more greenhouse gases, and more congestion.

Less public transportation services creates more highway traffic. Farther down the line, increased car traffic encourages more roads to be built, perpetuating the dominance of automobile dependence over public transportation options.

Driving produces, in economic lingo, negative externalities. Externalities are costs or side effects of performing an activity that is not reflected in the cost of doing that activity. For example, an increase in driving causes more pollution, which results in more premature deaths and higher public health costs. Some have suggested that in order to compensate for all the negative effects from driving – everything from increased incidences of asthma attacks to harmful carbon emissions – the gas tax should be $2 a gallon, a fourfold increase.

These externalities have real dollar amount consequences that are often ignored in the public discourse on transportation funding. For instance, the Texas Transportation Institute’s 2010 urban mobility report revealed that congestion currently costs Minneapolis-St. Paul $1.7 billion a year or $970 for each auto commuter. The cost of congestion includes the cost of wasted fuel and wasted time. Without Metro Transit, congestion would cost the region another $115 million (and this assumes gas is a mere $2.55/gallon). In other words, considering the congestion savings alone, non-transit riders already recoup the cost of helping to fund public transportation. (All figures are from TTI’s 2010 urban mobility study. They use 2009 figures, which explain the lower cost of gas. Almost certainly, in 2011, all of the savings and costs would be higher.)

Of course, lowering congestion is only one of the many benefits of funding public transit. Public transportation also helps offset and decrease many of the other negative externalities of driving such as traffic accidents, air pollution, and infrastructure fatigue. MnDOT found that “for every $1 invested in public transportation, $4 is generated in economic returns.” For all the benefits that public transportation offers for the region, it represents only about 2.3 percent of the $4.7 billion state transportation budget. (This calculation is based on budgeted $31.6 million for state transportation funds and $78 million to Metro Transit, for a total of $109.7 million out of the state transportation budget of $4.7 billion.) Public transportation is not an economic problem; it’s a political problem.

The Met Council has drafted an ambitious and impressive vision for 2030, which is designed to double public transit ridership. Besides increased regular bus service and opening of the central LRT line, the plans calls for three corridors to be built as Light Rail or dedicated busways, four new bus rapid transit (BRT) corridors built on highways, and one new commuter rail line. BRT is already being implemented on 35W and Cedar Ave, and there are other transportation plans in the works, including the possibility of streetcars returning to Minneapolis.

Michael Mintz

Michael Mintz (mintz.mpls@gmail.com), a global citizen, will soon be starting a graduate program in urban planning at University College London.