By James Rubin, PhD
TransPro Principal
In 2023, transit agencies received $21 billion in federal government support, $55 billion in state and local government support, and $10 billion in customer fare revenue. These are massive investments without a means to determine quality of service or value to communities. Customer and community perceptions are not consistently tracked nationally and worse, are not factored into funding considerations.
The most important metric when the largest bucket of federal transit funds is distributed is the industry’s measure of supply: vehicle revenue miles. Nearly 44% of FTA’s $33.5 billion Urban Area Formula Grant (5307) funding is based on vehicle revenue miles (VRM). It’s no wonder agencies are reluctant to reduce VRM. A reduction in VRM leads to a decrease in federal funding and thus leads to a loss in revenue for the agency. Where’s the incentive to match supply with demand and run an efficient system? As a nation, over the past ten years we’ve matched a 28% decrease in demand with only a 1% decrease in supply.
The impact of the supply/demand mismatch on service effectiveness is profound. Today, an average bus transports only 2.1 customers per mile. The cost of running nearly empty buses on routes without demand are at the heart of transit’s “fiscal cliff.”
And what does VRM mean to the woman at the stop waiting for the bus? She wants the bus to come on time, be clean, and transport her to her destination safely without incident. We can measure how successfully agencies are delivering on these important customer experience attributes from the customer perspective. We should be incentivizing agencies to set customer experience goals and achieve them, but instead we are incentivizing them to provide near-empty VRM.
Similarly, VRM means little to community members. With remarkable consistency, when communities are surveyed, they almost always say access to jobs, mobility for low-income families, and mobility for those who cannot drive are the most valuable benefits of transit. We can measure how successfully agencies are delivering on these important community value attributes from the community’s perspective and should incentivize goal setting and performance toward those goals.
