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|The Costs of Low Transit Fares
May 10, 2010 -- My favorite candy bar is one of those Ritter Sport numbers -- the one that's dark chocolate with hazelnuts. The price varies a little, but you can get them for two dollars at Trader Joe's -- that's two dollars for 3.5 ounces of paradise.
Imagine that the cost of chocolate and hazelnuts went up and the Ritter company couldn't make money selling the Sport bars at that price, but the company was worried that its customers couldn't afford to pay any more. So what if they kept the retail price at two dollars but reduced the size of the bar to 2.5 ounces; would that be a price increase?
Of course it would -- paying the same amount for less is just as much of a price increase as paying more for the same.
And believe it or not that brings us to the agony the Santa Monica City Council is going through about raising the fares for the Big Blue Bus (BBB). The council members don't want to increase fares, but if they don't, service will decline. In that case the fares riders are paying will stay the same, but the riders will get less in return. i.e., a price increase.
Here is some unconventional wisdom: transit fares should be higher, to pay for better service, which will attract more riders -- riders who can afford to pay more and will do so for better service. If governments like the City of Santa Monica believe that fares are too high for low-income people, for the elderly, or for the disabled, then they should subsidize fares for those people. It would be easy to do, for example, with coupons or special fare cards -- the BBB has in fact itself recommended that the City Council authorize it to participate in a subside program run by the Metropolitan Transportation Authority for low-income people.
But the City Council should not view the BBB as being part of a welfare system. The BBB is in the transportation business. Transit systems should deliver the best transportation they can deliver -- it's not up to them to solve the equity problems of our economic system. Get the subsidy somewhere else.
And when it comes to mass transit, "best transportation" means, more than anything else, frequent service. It's ridiculous, for instance, that the best the BBB can do with its bus on Wilshire Boulevard is service every 15 minutes (20 minutes outside rush hour), or even more ridiculous that its purportedly "Rapid" service on Lincoln runs only every 15 minutes and only during parts of the day.
How can you rely on buses that come so infrequently? You have to spend too much time looking at schedules, and then if you miss one, you're doomed to a long wait.
Meanwhile, the BBB's cheap fares have no relation to value. The #2 bus on Wilshire can go from downtown Santa Monica to UCLA in 30 minutes -- that has to be worth at least three times as much as the 75 cents the BBB charges. But who would want to take the chance of missing a bus and waiting 15 or 20 minutes to get the next one? Answer: not anyone who could afford $2.25.
Or take the BBB's freeway service to downtown L.A., the #10. A great bus, and ridership has been increasing so much that the BBB has in
fact added runs. Yet even so, usually when I take it some riders have to stand. Since the bus takes the freeway, and often the freeway is jammed, that can be a long time to stand. The #10 needs even more runs.
The price of the #10, an "express" bus, is $1.75; that's more than twice the regular BBB fare of 75 cents, but the ride is worth at least five dollars. But have you taken the #10? The BBB uses the same city buses on this express route that runs on the freeway as it uses on shorter-run buses on the street grid; how come they can't find buses that are more comfortable for a longer route? Other bus systems, in places where middle- and upper-income people take buses, i.e., where the transit system is not part of the welfare system, use coach buses for routes this long.
Fares in New York City, or in all European cities that I know about with great transit systems, are two dollars or more. You don't create a great public transportation culture by giving away bad service.
I applaud City Council Member Gleam Davis for pointing out, at the council's meeting on the fare issue April 27 (see story: April 30, 2010 Vote Delayed on Blue Bus Fare Hikes), that one reason this fare increase is so agonizing is that the City has failed to raise fares to keep up with inflation. The senior/disabled fare of25 cents has not increased since 1985, but just think how much Social Security benefits have increased since then.
City Council Member Kevin McKeown says he doesn't want to condemn seniors and the disabled to being "homebound" if the City raised the fares for them. But maybe what he should think about is that just because someone is elderly or disabled, that doesn't mean his or her time doesn't have value. Maybe they'd like to pay more and get better service, too.
To go back to the candy bar example -- there's another way to create more value than by lowering fares, and that's by increasing what you get for your money. If Ritter increased the weight of Sport Bars to five ounces, and kept the price the same, that would be a reduction in price in the form of an increase in value. If the BBB increased frequency of service, the BBB would be giving bus riders more for their money, too.
And while we're on the subject of value, what about other amenities tomake traveling by bus more valuable? I read recently about a school district in Arizona that has equipped its school buses with Wi-Fi, so that the kids can use their computers while on the bus. How about that for the BBB?
If the members of the City Council want to subsidize transit for poor people, the elderly, the disabled, that's a great idea, but the subsidy shouldn't take the form of bad service for them and everyone else.
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