Street Spirit October 2004

Injustice on Wheels: The High Cost of Public Transit

by Robert Mills

The Metropolitan Transportation Commission (MTC), representing much of the San Francisco and East Bay region, is the decision-making body regarding how transportation is planned and implemented.

The State of California allocates tax money and the MTC makes the decision as to how that money is spent, and on what kind of programs. In theory and according to law, this decision-making body cannot make its decisions unilaterally without public input and research.

Several months ago, public hearings were held on planning for the next five years. In those hearings, poor people and people of color spoke to the MTC about the need to lower bus fares, reinstate a better bus transfer program, including a bus-to-BART transfer, and increase bus lines to and from low-income neighborhoods.

MTC responded by cutting bus lines, increasing bus fares and spending money on a study to ascertain how much transportation cost low-income households.

This study was conducted by the Public Policy Institute of California. Research fellow Lorien Rice concluded in the study that low-income and higher-income households spent about the same amount on transportation costs. Many advocates have disputed those conclusions as not realistically reflecting the hardships poor people face in affording transportation and the difficulties of using public transit to get to and from jobs, schools, hospitals and other crucial destinations.

The Public Policy Institute of California is a publicly funded research think tank founded by David W. Lyon (president-CEO) and Raymond L. Watson (chairman of the board and vice-chairman of the board of the Irvine Company, developers and landowners). It is financed by a donation of $125 million from William R. Hewlett.

The purpose of this think tank is to provide information to state leaders in order to help them make better public policy. The institute's research is primarily in the areas of population, economics, governance and public finance.

President-CEO David Lyons comes from the Rand Corporation. From 1972 to 1994, he was both the vice-president/corporate officer and senior economist for Rand. From 1969 to 1972, he was the regional economist for the Federal Reserve Bank of Philadelphia. His area of specialization is in economics, Pacific Rim issues and public management.

The chairperson of the Public Policy Institute is a chief attorney for the Los Angeles City Attorney. Other board members and the advisory council are comprised of bankers, economists, and public management experts. Lorien Rice, the author of the study on transportation spending, is an expert in economics.

While the Public Policy Institute has tremendous credentials and huge financial backing, the study on public transit was biased from the get-go. Rather than seriously examining the core issues of equity for low-income and poor transit users, the study simply provides justification for the ways the Metropolitan Transportation Commission wants to spend money.

The Public Policy Institute is rooted in the interests of landowners, banks, and major corporate entities, and not with poor people. Because of the nature of the economic institutions behind it, the transportation study is flawed from the outset.

In Rice's study of transportation spending, there is a presumption that incomes between the rich and the poor need not be differentiated. She concludes that "across all forms of transportation," the average annual expenditures among low-income households came to $2,164 (13 per cent of the household budget), while the higher-income households' costs averaged $6,569 (15 percent of the household budget).

This fails miserably in measuring whether transportation is affordable for low-income people, for $2,164 can be a sacrifice for a family making only $8,000 to 9,000 per year, compared to a family making $50,000 per year. Secondly, the study relies on data from a study made in 1999 and completed in 2001 by the Bureau of Labor Statistics.

The study did point out that lower-income households who had vehicles spent 19 per cent of their resources on transportation, compared to the more wealthy who spent only 16 per cent of their resources. It also concluded that the "non-monetary costs" of public transportation, such as commuting time, loss of access, and foregone job opportunities, may be high for the poor.

Because Rice relied on data that is biased and out of date, her study is useful only for the more wealthy consumers, and cannot be used to determine whether transportation is affordable. She fails to provide information as to whether the cost of transportation is a barrier to essential destinations such as jobs, health care and child care. This data could only be provided by a current survey of consumers in the East Bay and San Francisco, not from a statewide study made four year ago.

On August 27, Richard Marcantonio, the managing attorney for Public Advocates, Inc. in San Francisco, along with a multitude of transportation justice advocates from Communities for a Better Environment, Urban Habitat and other groups, attended a meeting with the Metropolitan Transportation Commission to address this study. A memo sent after that meeting made these key points:

1. The study reaches the "key finding" that it is "unlikely" that costs are a barrier to transit use by most low-income households. It ignores the reality of what transit actually costs in the Bay Area. The average transit expenditure of $360 per year is barely enough for a single adult to ride AC Transit for six months.

2. The policy strategies in the study are not policies but a smattering of programs.

3. The policy strategies of the study are not driven by the data which, as the study concedes, does not answer the question about the affordability of transit for low-income households.

4. The study does not meaningfully contribute to finding a solution to the high cost of public transit.

These conclusions were presented to MTC in a public meeting ("by invitation only") held on September 15.

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