Metro to hold budget workshop and public hearing on May 16

Proposed Fiscal Year 2013 Budget

Here’s the news release from Metro — the most newsworthy item, I think, is that the $4.5-billion budget does not propose raising fares for the 2013 fiscal year:

Metro will conduct a budget workshop and public hearing on a proposed $4.5 billion budget for Fiscal Year 2013 on Wednesday, May 16, at 2:30 p.m. in the third floor Board room at Metro Headquarters, One Gateway Plaza, Cesar Chavez & Vignes, next to Union Station in downtown Los Angeles.

The budget can be viewed online by clicking here. The public can view a copy of the balanced budget proposal at Metro.net. Request copies via e-mail at rmc@metro.net or by calling Charlene Williams in Metro Records Services at 213.922.2342.

Metro’s Board could consider adopting the budget for the fiscal year beginning July 1, 2012 at the board meeting that starts at 9 a.m. on Thursday, May 24, at Metro headquarters.

Metro CEO Art Leahy’s budget proposal, which is balanced with no shortfall, does not propose raising fares, which already rank among the lowest in the nation. Metro’s farebox recovery will stay at 28 percent, again near the bottom of any major operator, and passenger loads also will be low compared to our peers.

The proposed budget includes the following: $1.467 billion for transit operations, $278.5 million for deferred maintenance of Metro’s rolling stock of buses and trains, $1.084 billion for construction of Measure R transit projects, $134.5 million for other capital improvements, such as bus maintenance facilities, $236.5 million for a robust highway program; $339.5 million for debt service obligations and $974.7 million in subsidies distributed by Metro to fund Metrolink, regional operations and transit projects throughout Los Angeles County.

Against the backdrop of high gas prices, Metro will be offering commuters and others viable public transit alternatives with new light rail service on the Expo Line connecting downtown Los Angeles and Culver City and the Metro Orange Line busway extension to the Metrolink/Amtrak station in Chatsworth. Metro also will bolster express bus service on the Harbor Transitway and the I-10 between downtown and El Monte as the ExpressLanes congestion pricing demonstration project debuts

Highway projects include the I-405 Sepulveda Pass Improvements Project, the High Desert Corridor, the SR-710 north gap closure and the widening or other enhancements on various stretches of the I-5, I-605, I-710 south, and SR-138. Efforts will continue to construct sound walls and implement Metro’s freeway beautification program.

Metro CEO Art Leahy stressed a renewed focus on customer service with a strong emphasis on reliability, cleanliness and courtesy. Metro is purchasing hundreds of new buses and rail cars and catching up on years of deferred maintenance for Metro’s rolling stock. Stations will be cleaner, safer, and there will be better signage so that customers who speak a multitude of languages can better navigate the Metro system.

The proposed budget restricts hiring new employees except to fill positions needed to deliver Measure R projects and operate new services. Moreover, Metro has set in motion a program to recruit and train the next generation of managers and operations employees to allow for a smoother generational transition.

Metro funding comes largely from local transportation sales tax revenue along with transit assistance and grants from the state and federal governments, farebox revenue, and other revenue sources such as advertising, land leases and commercial filming.

The FY 13 budget is $337.3 million or 8.1 percent more than the current $4.178 billion Metro budget. This reflects a significant expansion of the Measure R program in the next fiscal year. In the new fiscal year Metro will be spending $1.560 billion on Measure R projects and programs compared to expenditures of $1.278 billion this fiscal year. In addition, Metro will be spending $35.2 million to operate the new Expo light rail line in FY 13.

Thanks to Measure R, the half-cent sales tax approved by voters in 2008, Metro is overseeing the largest public works program America has seen in decades. Projects underway and about to start construction are designed to stabilize and downsize the region’s worst traffic to manageable levels while generating hundreds of thousands of direct and indirect jobs, stimulating the economy, and improving air quality.

However, the reality is that Measure R does not include enough funds to support operations for all the new rail projects in the pipeline. A reduction in state or federal funding, or a dip in the local economy or ridership will endanger the balanced budget presented.

In terms of the proposed budget, Leahy said it’s prudent to flag these risks now so that Metro’s Board can avoid future roadblocks that could detour crucial progress in this decade. In that sense, FY 13 will be a pivotal period for Metro and Los Angeles County in more ways than one.

50 replies

  1. “Metro’s farebox recovery will stay at 28 percent, again near the bottom of any major operator”

    They really need to get working on fixing this.

  2. If they made the cost of taking public transit based upon travel distance, I’d consider using Metro more often.

    Unfortunately for me, paying $75 for a monthly pass for a 10 mile commute from Inglewood to Culver City that takes close to an hour and requires three transfers isn’t really cost effective nor a good deal.

    If it was like $20 a month or so for that short commute, then I’d consider taking Metro more often and would deal with the transfers and wait times. But for $75, no way; I can get by cheaper and faster by trading in one of my older, fuel inefficient cars for a much more fuel efficient motorcycle.

    I think that’s the conclusion more cost-conscious Angelinos are making these days, especially those with shorter commutes. These days, I see a lot more people commuting with motorcycles than years before.

    That could be a contributing factor why Metro is still hovering at such a low farebox recovery rate; the prices aren’t too attractive for many commuters who only need it for shorter commuting distances. Instead, increasing number of people are just learning how to drive a motorcycle.

  3. If Metro lowers the fares then they would lose even more money and have a lower farebox recovery ratio. Cities in Asia are not comparable to the US, because Asia generally has very hostile policies towards automobiles, while we obviously do not. US cities that use distance based fares like San Francisco and Washington have not only much higher fares for long distances, but they even have a higher base fare.

  4. @Matt
    “If Metro lowers the fares then they would lose even more money and have a lower farebox recovery ratio.”

    No. The flaw in your equation is that ridership numbers will remain the same when lowering fares. On the contrary, by reducing fares for those that travel shorter distances, it will actually encourage more ridership from short distance commuters to try out Metro.

    I doubt anyone is going to ride Metro for 5 miles of transit. $1.50 for 5 miles, maybe one person will ride it. That only brings in $1.50 to Metro. When Metro takes the opposite approach and raise fares to $2.00 in order increase their farebox recovery ratio, chances are likely that Metro is going to lose this rider to the motorcycle, much like Eduardo A.

    Now instead, if Metro institutes a distance fare policy where the 5 miles of transit is now only $0.50 instead of $1.50, Metro may suddenly see 10 people will ride it. 10 x $0.50 = $5.00 to Metro. Metro sees an increase in ridership and revenues.

    Case in point, Metro saw a larger increase in ridership and higher revenue when they reduced the day pass from $6 to $5. Metro was expecting a loss of $4.5 million in revenue when they first reduced the day pass from $6 to $5. Instead, they actually saw an increase in revenue of over $1.3 million.
    http://www.metro.net/board/Items/2012/03_March/20120315EMACItem34.pdf

    Why? Because more people actually bought day passes when they lowered the price of the day pass.
    $6 x 260,000 = $1.56 million
    $5 x 400,000 = $2 million

    Case #2, contrary to belief, transit agencies in Asia do not have a high base fare. Look at the fare structure for the Taipei Metro:

    http://english.trtc.com.tw/ct.asp?xItem=1056377&CtNode=49782&mp=122032

    The cheapest single journey, short ride of about 2 minutes on the train, only cost 20 TWD, or approximately 68 cents. If you use a transit card, it only costs 16 TWD or 54 cents. If one is eligible for discounts (seniors, students), that short ride only costs 8 TWD or 27 cents. Even the most expensive trip only costs 60 TWD for the full length of the ride, which is approx $2.04, with discounts when using the card or eligible seniors.

    And how much farebox recovery ratio does the Taipei Metro reap in? An astonishing 119%!!!

  5. @ Matt

    and it keeps going higher in Washington to cover their Budget Shortfall.

    SmarTrip Card Fare Changes:
    – Eliminate the peak-of-the-peak (POP) surcharge
    – Increase peak-period SmarTrip fares by an average of less than five percent with a maximum peak fare of $5.75
    – Increase base off-peak fare from $1.60 to $1.70 per trip
    – Set the maximum off-peak fare at $3.50

    Paper Farecard Pricing:
    – $6 flat fare during peak periods and $4 off peak
    – Eliminate the short-trip pass and day pass

    Bus Fare Changes:
    – Increase SmarTrip local bus fares by a dime, from $1.50 to $1.60
    – Charge $2 for local/limited stops, $4 for express bus

    Parking pricing:
    – 25 cent increase

    http://www.nbcwashington.com/news/local/Metros-GM-Proposes-Fare-Hikes-137001168.html

  6. @Matt

    I think your way of thinking is the main reason why we’ve been seeing schisms between pro-transit supporters these days. You clearly just don’t understand how things work.

    Public transit, is not a commodity. You cannot apply commodity logic to public transit. There is no such thing as “people will pay the fare whatever we ask them to pay” like oil, natural gas, or metals.

    This is because there are alternatives to public transit. And no, cars, buses, and trains are not the only way to get around this city. People can walk, ride a bicycle, drive a motorcycle. All these are alternatives, or in other words, competitors to public transit. And in the world of economics, competition is what drives the market system such as the US. If there is a cheaper alternative, that’s what people will use. Face it, you’re not going to buy a laptop that’s purely Made in the USA at a price of $4,000, when you can get a good deal at BestBuy for $499.00 that’s Made in Malaysia, right?

    And for shorter distances, Metro isn’t a good deal and does not compete with cheaper alternatives like walking, bicycling, and driving a motorcycle. And what does Metro lose out when there’s a cheaper alternative? They are unable to tap into the market, cannot reap in revenues, nor see an increase in ridership from this market.

    Essentially, I’d like to use the analogy of distance based fares like a cans of soda. They don’t sell sodas for the same price for those that want just one can versus those that want a 24 pack at Costco. If you buy one can of soda, you only pay somewhere in the ballpark of $0.50 to $0.75 depending on the vending machine. The vending machine doesn’t rip you off for $9.99 for just one can of soda right? Who’s going to buy it?

    That’s how distance based fares work. Essentially, the current fare system that Metro uses is a rip-off for shorter distance commuters. If one person like Eduardo A. thinks it’s not worth paying $75 for a monthly pass for a short 10 mi commute and is opting to ride a motorcycle instead, that’s an example of how Metro is losing ridership in the short distance market right there. And for Metro to gain Eduardo’s ridership, they need to start competing in the short distance riders’ market. And how can they do that? By making those who only travel shorter distances, pay less.

  7. @Matt
    Yes and no. With distance based fares it would depend on the trip taken. So yes, sometimes it would be higher (going downtown from the valley) but at other times lower (like taking a metro bus down Ventura blvd. to a restaurant.) But even so, If slightly higher fares meant more service and a better, faster system, then yes it just may be worth it. You get what you pay for. Its better to have Metro be farebox dependent than tax dependent when the choice is there. Its time for metro to change its fare structure to better reflect the dynamics of travel the Los Angeles area.

  8. They need to pay more attention to the escalators, especially the ones that are outdoors and going to the upward direction. I hope they install the canopies more quickly.

  9. @Matt

    Weren’t you the ones who also said there’s nothing wrong with the honor system too? LOL

    You clamor for change but you don’t like change when it doesn’t benefit you. All your answers are tax, tax, and more tax. Some of us are sick of the same old solutions which don’t work. It’s time we tried something different like distance based fares. Cheaper fares for shorter rides, more for longer rides makes perfectly good sense that fits the needs of how Angelinos travel about in this vast city.

    I call for fare reform. We can beta test distance based fares on the Red Line just like how they beta tested gate lockings. Then there would be solid grounding whether or not distance based fares work better than flat rate fares.

  10. “Cities in Asia are not comparable to the US, because Asia generally has very hostile policies towards automobiles, while we obviously do not.”

    Have you lived in Asia? Do you consider yourself in Asian transportation policy? These “oh, they just make car ownership more costly in Asia” comments really irritate me because it just shows that you really don’t know anything what you’re talking about. You are not Asian, you are not an expert in Asia, so please don’t blabber stuff out of your mouth as an excuse to put your point across.

    For one, taxes on cars and gas in Asia do dissuade people from owning cars, but at the same time they hardly add any value to their transit projects either. Who’s going to be driving cars in Singapore when they levy a 100+% tax onto cars and make it cost an arm and a leg just to get a drivers license? Very few and only the very wealthy. With so few people owning cars due to high taxes, it hardly makes a contribution to transit projects. That’s why in Singapore, public transit is actually a private company.

    And not every country in Asia are hostile to car ownership either. Only very tiny countries like Singapore and Hong Kong which has serious land space issues. They dissuade car ownership because land is limited and cars just take up too much space. On the other hand, they have a lot less restrictions on smaller vehicles like scooters and motorcycles which don’t eat up much space as cars. This is why places like Taiwan, Thailand, Malaysia and Indonesia has lots of scooters on their roads.

    Furthermore, contrary to belief, taxes to cars are much more relaxed in places like Thailand, India, Taiwan, South Korea, and Japan than you imagine it to be. Granted these places may have a higher gas tax than the US, but you’re making a big deal out of it that those solutions are the almighty answers to solving public transit funding issues in the US. No it won’t, and neither do these solutions work out for rural areas in these nations as well.

    For example, if you go to a rural area in Japan, they need cars to get around just as the US. You may have this vision that Japan is full of trains and that it’s so high tech, but once you step outside of the metropolitan areas, the rural areas are not much different from rural areas of the US. But since gas cars are high, they actually produce smaller cars for the domestic market which get better mileage and aren’t even subject to high vehicle taxes. Have you heard of Kei cars?
    http://en.wikipedia.org/wiki/Kei_car

    You should check up on the facts why they exist. Some of those cars run even in Catalina Island.

    So please, quit bringing up the Asian excuse like you’re an expert in Asia. You are not.

  11. My commute is 6 miles. Its still cheaper and faster to drive. If gas gets higher, I can still bike. Unless public transit becomes cheaper for my needs, that option is way at the bottom of my list of options.

  12. @Matt
    Please convince me why I should I pay $75 for a monthly pass when my commuting needs is only 10 miles, it requires three transfers, and takes me close to an hour to get there? In all honesty, if it’s going to take me an hour to commute such a short distance, I can probably bicycle there in about the same time to save myself $75 each month. Alternatively, I can save time and by paying only $45 per month in the cost of gas and insurance by selling my car and learning how to drive a motorcycle. From the standpoint of time and cost, Metro just doesn’t fit my needs unless they have fare reform. Now if it were cheaper than getting around with a motorcycle, then it’d be at least worth the wait times and transfers.

  13. I think Metro needs to start listening to the good points and arguments written here. Many of the so called know-it-alls don’t really give out realistic answers anyway. Fare reform can be done faster and should be seriously considered as a way to boost ridership and increase farebox recovery ratios. 28% is just pitiful.

    If you think about it, having cheaper for shorter distances to gain ridership numbers is so such a right-under-your-nose concept! How do people use their cars in LA? They use it to go to the supermarket, movies, parks, and restaurants which tend to be a short distance away from where they live. Have a midnight craving for Taco Bell, people drive. Need to go to Staples or Office Depot to buy school supplies for the kids? People drive. Need household goods? People drive to Target. Need a coffee break to study for exams? People just drive to the nearest Starbucks or Coffee Bean. All of these tend to be short distance activities which are faster and cheaper to do by car than public transit.

    And for shorter distances, Metro fares just aren’t competitive enough to warrant giving up the car. As it stands now, no one is going to use Metro to go to the park in their neighborhood with their kids, no one is going to ride the Metro to go to their favorite restaurant in the area, and no one is going to use Metro to stock up on groceries at Ralphs. I clearly don’t see anyone wanting to pay $1.50 just to get to a nearby Starbucks that a mile away, nor pay $5 in day passes to travel across two buses for a short 5 mile travel just to see a movie. I doubt parents would be willing to pay a total of $15 in day passes (mom, dad, and child) just to buy school supplies at Staples or Office Depot that’s only 4 miles away from where they live either.

    If Metro is serious about converting how Angelinos get around the city, they need to rationalize the fare structure to better fit the needs and lifestyles how people travel around in this city. Having everyone pay the same price without considering distance traveled just isn’t cut out for a city so big and diverse as LA.

  14. Not that it matters, but I have spent extensive time in Asia and yes, they have completely different transportation policies compared to the US. Not only is gas and car ownership more expensive, especially relative to incomes, but perhaps the biggest difference is that there is little free parking and in many cases no parking at all. Compare that to Downtown LA which is half parking lots or even worse the rest of LA County where there is almost limitless parking due to mandated parking policies. It is much easier to charge $3-$4 to riders on a line like Expo if they can’t easily drive their cars to their destination instead.

    I never said there was nothing wrong with the honor system. You must have that wrong. Realize that to implement distance based fares will cost money. Metro has spent hundreds of millions on faregates and TAP and it still has to yet to work all that well. Now you would have to add some sort of system to over 2,000 buses that can charge people when they leave the back of a bus, since our Metro is more of a bus system than a rail one like other cities. That won’t be cheap.

    Not saying that distance based fares should not be done, but that will mean that trip down the whole Blue Line will cost something like $3 instead of $1.50, which is more comparable to DC or SF. I think it does need to move to this to maintain and possibly increase farebox recovery, but people won’t be happy.

    As far as reducing fares, yes there would be some bump in ridership, but it would put Metro further in the hole. For example, on the poster that wanted to reduce monthly passes to $20, Metro would then need to have 4 times as many riders just to break even (actually more because almost no one would buy day passes and one-way fares under this scenario). Say that were to take place (which is extremely doubtful at best since people don’t ride, because it is generally slower and more inconvenient more so than cost reasons), they would still have to keep their cost structure in place to keep the same farebox recovery ratio so that means they could not add any more capacity. That would mean your bus and subway car would be 4 times as crowded – completely impossible on the transit I ride.

    Sorry to bring much needed reality to the “lets cut fares and reduce tax subsidies and everything will be fine crowd”.

  15. “but that will mean that trip down the whole Blue Line will cost something like $3 instead of $1.50”

    How many people even ride the Blue Line for the whole length from 7th/Metro to Long Beach? Or how many people ride the full length of the Green Line from Redondo Beach to Norwalk? Or ride the full length on our Metro Buses?

    Very few riders ride the buses and trains for the whole length of the trip. Majority of the riders get on at a particular station/bus stop along the way and get off at another station/bus station a few station stops/miles away.

    Paying a $1.50 only benefits the few who travel end to end. Majority of Metro transit riders, do not ride it from end to end.

  16. @Matt
    “That would mean your bus and subway car would be 4 times as crowded – completely impossible on the transit I ride.”

    Don’t you think such problems aren’t faced by cities in Asia as well which run on a distance based system with high ridership numbers?

    There’s a lot of ways to solve those problems. Remove seats and increase standing room space. Reposition the seats to face the aisle to increase standing room capacity. Use tap-in/tap-out transit data to use less rail cars during certain times of day when there are less people riding the trains and add rail cars at peak commuting hours.

    Use the increase in ridership data to build a case that more transit funds are needed; this is much more reliable than asking government for more money without solid data. Use the increase in ridership data as solid grounding to repeal stupid policies that prevent us from getting longer buses which allow more passengers. Use the increase in ridership data to repeal stupid restrictions like not converting the Orange Line to light rail.

    All these are ways Asian transit agencies efficiently manage their transit systems. Not pointing out these alternatives and strategies show that even if you did spend time in Asia, that you aren’t as knowledgeable on how Asian transit agencies manage to solve such problems that you mentioned.

  17. @Matt
    “Realize that to implement distance based fares will cost money. Metro has spent hundreds of millions on faregates and TAP and it still has to yet to work all that well. Now you would have to add some sort of system to over 2,000 buses that can charge people when they leave the back of a bus, since our Metro is more of a bus system than a rail one like other cities. That won’t be cheap.”

    Testing out distance based fares at least on our rails can be done now with existing infrastructure. The best place is the Red Line. We already have fare gates on all the subway stations and transit riders have to go through them when they go in and out of the Red Line system. The gates themselves are capable of tap-ins as it stands now, and the feature to tap-out from the other end (platform side) is also active. Once gate lockings are complete on the Red Line, they can practically start testing out distance based fares there as well.

    We already have tap readers on our buses that do tap-ins. It’s right next to the bus driver where people fumbling their pennies and wrinkly dollar bills into the fare box. Adding an additional tap out device toward the back of the bus isn’t that costly as you make out to say.

    Do you even know how cheap contactless card readers cost these days? Majority of them, as much as everything today, is Made in China at a cost of $10 each. Buy it in bulk and these things can be bought for like a $1.

    http://www.made-in-china.com/products-search/hot-china-products/Contactless_Card_Reader.html

    At a $1 each, adding contactless card readers for tap-out for the back of our 2,000 buses is about as expensive as one good laptop from Apple.

  18. I think all Metro needs to do is follow the example of how cell phone companies make money.

    We offer multiple plans. Unlimited calling, texting, data plans for $69.99 per month is similar to a 30 day pass for $75. Those that need less calling, texting and data, can pay less per month with a different plan. This is like a weekly or day pass.

    And then we also offer pre-pay plans for those that don’t use their cells phones that often and all they do is voice calls. People can top-up any amount of airtime onto their cell phone. If you call for 1 minute, it deducts 1 minute worth of airtime. If you talk for 30 minutes, it deducts 30 minutes worth of airtime. And it does this all the way until it reaches zero when you need to top-up whatever amount you wish again. For those that don’t use cell phones as often and has no need for texting or data plans, this is a far better deal because a top up of $100 can last up to six months or a year depending on their voice call usage.

    For those that only use public transit for shorter distances, they can just top up $100 onto the TAP card, and it’ll keep on deducting the amount based on distance traveled. If the commuters’ rides are short, they can probably last $100 for six month or a year so, just like the prepaid plans for cell phones.

    With all these different plans from the most heavy user to occasional callers, cell phone companies is able to reach out to diverse markets and users which have different needs. There’s no need to choose one or the other, unlimited ride passes and pay-by-the-distance can co-exist, just like cell phone plans.

    And besides, I don’t think it’ll be that hard to do a “what fare plan is more economical for your needs” feature using Google Maps on metro.net.

    If your commute mainly involves traveling from the SF Valley to Downtown LA, you might be better off with a $75 monthly pass. But if your commute involves only three stations worth of travel on the Expo Line or just 5 miles on the bus whether or not you have transfers or not, you might be better off with the distance fare plan.

  19. The concept of distance-based fares is an interesting one that has potential to increase the fare-box take. However, there are many known unknowns (to quote a former SecDef), such as:

    What is the elasticity of demand when fare is proportional to distance? Or, would Metro gain enough shorter-distance riders to offset the potential loss of longer-distance riders now facing higher fares?
    Do busses have the space to accommodate a potentially big increase in short-distance riders? And would increased standing itself be a deterrent to riding?
    How would a bus accommodate a cash rider?
    Are there economic justice impediments?
    How would time-based passes be priced?
    How to prevent tap-out fraud? For example: (1) tap-in on a bendy-bus then take a position near a rear door; (2) at the next stop, tap out at the rear door *but do not exit the bus*; (3) continue riding for ten miles; (4) exit the bus without tapping out. Voila! A long-distance ride for a short-distance price.

    None of these (or others) may be insurmountable, but I want to suggest that switching to distance-based fares isn’t as easy as snapping your fingers.

  20. J Kim,

    Take a look at the pictures of the 720 on this blog a few entries down. Now imagine 4 times as many people on that bus. Even if you strap people to the roof, there is no way you are getting even double the amount of people on that bus. Your solution of begging for more transit money or using longer busses which are illegal and can’t make physically make turns or turning the Orange Line into rail (that costs money) aren’t pracitical if you are keeping costs constant which was my original post.

    And LA isn’t Asia. If Metro tried that, they would have Civil Rights lawsuits all over the place. You simply ignore the fact that asian transit agencies can charge more per rider because they are carrying much more than just the poor, which makes up the vast majority of Metro’s customers. Wealthier riders mean more advertising revenue and yes more retail options. What advertiser is going to spend big money advertising on a bus to someone who can barely afford the $1.50 fare and has no disposable income.

    While retail may be nice to add on our system, it won’t be the financial panacea that everyone here says it will. I was in Rush at 7th/Metro a few weeks ago during a weekday morning. Beautiful space and I sat there for 20 minutes. Mind you this is in the busiest station Metro has with strong demographics (downtown office workers who have much higher incomes than the typical Metro patron), and no one else came in during the time I was there. People act like Metro can make hundreds of millions from retail. They probably make less than $10 -$15k a year from Rush and it is in a far superior location than pretty much all the Blue/Expo/Green or other Red/Purple Line stations.

  21. “You simply ignore the fact that asian transit agencies can charge more per rider…”

    Maybe you need to check your facts on how much transit costs are in Asia under the distance based system because I doubt 68 cents for shorter rides up to $2.00 for longer rides on the Taipei Metro is “expensive.”

    They even provide discounts for those with EasyCards and if you are a senior, student, or the disabled.

  22. @MarkB
    I’d assume questions and concerns like those have already been answered by transit agencies in Asia. They have years of experience in running public transit in the distance based model. Naturally, they’ve already have the answers to those problems.

    It’s just like the question some Metro person made about “how do we do gate locking when there might be people with no hands?”
    http://thesource.metro.net/2012/02/23/metro-board-moves-to-lock-gates-at-metro-rail-stations-within-next-six-months/

    The answer is always “go ask Japan, Taiwan, Hong Kong, Singapore how they figured out that solution ages ago.”

    I mean really, this is what my tax dollars pay for?

    “What if [insert question]”
    “Go ask Japan, Taiwan, Hong Kong, Singapore…”

    “But what if [insert question]”
    “Go ask Japan, Taiwan, Hong Kong, Singapore…”

    “Yeah, but what if [insert question]”
    “Go ask Japan, Taiwan, Hong Kong, Singapore…”

    @Matt
    I think people are just getting tired of your excuses which are nothing but a good example of being a pro-transit in name only slacktivist.

    You offer no real answers other than taxes, taxes, and taxes, because in your short sighted view, that is the easiest answer. Sorry but, taxes aren’t working and seems like more people are getting sick of it.

    Let’s try this
    Oh no that’s a dumb idea because [insert excuse]

    Then let’s do this
    That’s dumb too because [insert excuse]

    How about this
    That’s stupid because [insert excuse]

    Then what’s your answer to solve Metro’s transit funding problems?
    More taxes.

    Pfft.

  23. “And LA isn’t Asia”

    And LA isn’t NY, Boston, Washington DC, San Francisco, Amsterdam, Paris, and London either. So what’s your point?

    Besides, isn’t what people like you want? You naysayers all say that you want LA to become like a transit oriented city like them. Yet once you dissect them, that also involves making many changes that you may not like either.

    Becoming a transit oriented city isn’t just spending tax dollars on transit projects. It also involves things like locking the gates, moving to distance based fares, and making better use of stations. Some how you guys don’t want that and you step back and say “LA isn’t like _______” How convenient.

  24. “Some how you guys don’t want that and you step back and say “LA isn’t like _______” How convenient.”

    I think this summarizes it best. LA will never have a world class transit system without making big changes and reform to the way it handles public transit. The only problem is, how many people will be willing to accept such changes even though it means changing how Metro operates its business. Seems like there’s a big split in differences here.

    In many ways this is a reflection of the political climate of the US today; one side of pro-transit supporters wishes to maintain the status quo as it is today who are fine with keeping Metro dependent on taxpayers, versus another side of pro-transit supporters who wish to do something different who want Metro to seek alternatives means to raise their own revenues instead. They both want the same thing; for LA to become a world class transit city. Their approaches however, differs significantly.

  25. LAX Traveler, yes take home income in Taipei is roughly 60-65% lower than in LA so a $2.00 fare there is more like a $5 fare here.

    Frank M, actually I am in favor of distance based fares, which would mean higher fares for longer trips while keeping a base fare of $1.50. This would reduce tax subsidies necessary and result in a higher fare box recovery similar to DC or SF. Where have I said I am for more tax subsidies?

    I am realistic and did pay attention in my college Econ classes. Pounding the table and saying I want lower fares and lower taxes going to transit doesn’t mean any old proposal is a solution just the same as other people say I want lower gas taxes and better maintained roads and more freeways so why don’t we just have vendors and shopping malls at rest stops.

    Mark B. has an excellent post and now Steve H. has addressed the topic as well.

  26. Matt,
    “I am in favor of distance based fares, which would mean higher fares for longer trips while keeping a base fare of $1.50.”

    I don’t think having the fare start off at $1.50 is a good idea. There’s no real solid justification that people should start off at $1.50 when riding the bus even if it’s a short distance.

    Take for example Metro’s suggestion for my commute from Inglewood to Culver City. They suggest I first ride on Metro Bus 110 for 2 miles, then take Metro Bus 439 for 4 miles, and use the Expo Line for 1 station. The total cost ends up being $4.50 one-way, which means I’m supposedly better off with getting a 30 day pass for $75.

    But in the end, I take a step back and realize that I’ll have to pay $75/month for about than 10 miles of one way commuting which isn’t much of a deal, moreso true when it’ll take me close to an hour just to travel that 10 mile distance.

    And no, it’s not that I can’t afford $75/month, it’s that at such a short distance there are cheaper alternatives that I can get by with which in the end, probably steals my ridership and potential revenues away from Metro. If I can get by with something cheaper which allows me to put that extra savings into something else like my kid’s education or for a dream family vacation to Hawaii, that’s what I’m going to end up doing.

    What’s stopping me from carpooling? Nothing. What’s stopping me from bicycling? Nothing. What’s stopping me from trading in one my older cars for an all-electric Nissan Leaf? Nothing. What’s stopping me from selling one of my cars and getting a 45 MPG Harley Davidson? Nothing.

    And if I buy a Nissan Leaf or a Harley, my commute even cuts back to being about 5 miles one way because I don’t have to make weird transfers on a set bus route, which adds even more to fuel savings. Heck considering that, I can take just as easily trade my older car for a much fuel efficient 30 MPG Honda Civic whose daily fuel consumption cost comes out cheaper than starting off the fares at $1.50.

    Bottom line really, is really all about money and how much I can save with the many choices that I have as a commuter. Bluntly speaking, Metro still doesn’t gain any ridership from a market base like me because there are still plenty of alternatives that are cheaper and faster.

    The only way for Metro to gain any ridership from a market base such as myself is to set the fares lower. Being said that, starting off a ride with $1.50, isn’t a good way to gain ridership from a short distance commuter.

  27. I think at this point, it’s fair to say Metro’s existing fare policies are good for longer commuters, but isn’t as great for shorter commuters, and that maybe one of the reasons why their farebox recovery ratios are so low.

    Of course there maybe other factors, but it does seem like Metro needs to do a better job in finding a better fare structure to persuade more short distance commuters to take public transit. As Eduardo A. said, there are still so many alternatives that are cheaper, faster, and more efficient than public transit for shorter trips.

    Maybe a flat rate policy works in smaller, denser cities like New York or Boston where businesses are primarily located downtown and residences are farther away. But LA is not like that. We are big, spread out, with a mix of businesses and residential areas. Naturally, there’s going to be those that commute long distances and there will be those who have commutes that are shorter. It’s futile to expect a one-size-fits-all $1.50 flat rate / $5.00 day pass / $15.00 weekly pass / $75 30 day pass solution would be sufficient for transit needs for Angelinos.

    And as Cell Phone Seller mentioned, Metro could keep the passes for longer commuters to co-exist with a “distance fare plan” that is more likely to be a preferred choice to pay for shorter commuters.

  28. “This is because there are alternatives to public transit. And no, cars, buses, and trains are not the only way to get around this city.”

    Transit elasticities are well-researched. Here is a review of literature from around the world.

    http://www.vtpi.org/tranelas.pdf

    Transit elasticities are generally inelastic and and transit-dependent riders are among the least elastic group.

  29. “Or, would Metro gain enough shorter-distance riders to offset the potential loss of longer-distance riders now facing higher fares?”

    Loss of longer-distance riders would probably be offset by better service directly related to increasing farebox recovery.

    “Are there economic justice impediments?”

    The correct answer to this is, “Who cares?” but you are correct, the BRU would flip out.

  30. Eduardo,

    Metro’s mission is largely to reduce congestion and pollution with the tax receipts given to it. It is not to provide transportation to you in every situation. Biking and walking are always cheaper than transit and Metro would be better off if a person chooses these modes because it meets the goals of their mission without them having to spend their limited tax dollars subsidizing you.

    Take someone who lives in Avalon and works in Long Beach. He would buy a monthly pass if Metro would run a ferry. He thinks Metro should run the ferry because he pays taxes like everyone else in LA County even though it would cost Metro $1000 a month per person to subsidize this service. He thinks the Monthly passes should $50 instead of $75 or he is threatening to just kayak to work even if Metro runs the ferry because kayaking is basically free.

    Based on your logic, you probably think Metro should run the ferry and reduce the monthly passes. You might feel differently if the cost of the ferry service and the pass reduction causes Metro to cut service in Inglewood.

  31. Matt,
    “Take someone who lives in Avalon and works in Long Beach.”

    How many people living in Avalon actually do that on a daily basis? There are a lot more people living in LA proper who have shorter commutes than people going back and forth between Catalina Island and LB.

    That’s pretty much like saying Metro should offer cheap $1.50 public transit service from LA to Vegas as well because I’m sure there’s gotta be someone who does that.

  32. Frank M.

    It is just an example that points out that transit is cannot serve everyone for all their tranport needs and Metro has to take into account both revenue and costs of providing service.

    This person chooses to live in Avalon and by doing so is foregoing certain transit options just as someone who lives in LA proper may choose to live where they have to take 3-4 bus lines to travel to work vs. someone who lives near a Metro line and works downtown. Even with distance based fares, the former person is not going to have an attractive transit trip while the latter is.

    As for your comment about Vegas, Avalon is in LA County while Vegas is not and would never be in Metro’s service area.

  33. Matt,
    “It is just an example that points out that transit is cannot serve everyone for all their tranport needs and Metro has to take into account both revenue and costs of providing service.”

    No, what you’re doing is just trying to apply an unrealistic example to prove your point across.

    “As for your comment about Vegas, Avalon is in LA County while Vegas is not and would never be in Metro’s service area.”

    And yet somehow it makes sense to plan out to extend the Gold Line all the way to Ontario Airport, which is in San Bernardino County, so a person who wishes to go from Santa Monica to Ontario can do so for at a bargain of $1.50 while another person who only wants to go from Little Tokyo to Union Station also has to fork over $1.50 for an one station ride that’s less than a mile. Brilliant.

  34. Frank M.

    It is not an unrealistic example at all. Do you think people in Avalon never have to go to the mainland? They have to go for basic services like shopping, to see doctors other than a basic family practice doctor and so on.

    As I said before, I am fine with distance based fares similar to DC and SF. Just realize you are going to have to have a base fare similar to $1.50 we have now or something even higher like DC and SF have. People on here are expecting distance based fares to mean 25 cents for a short trip and $1.50 for a longer trip. That is completely unrealistic and will not happen.

  35. Matt,
    And how often do 4000 residents of Avalon go to the mainland and how many Avalon residents actually have residences in the mainland as well for the purposes that you mentioned? They already have a 10 ride for $180 subsidy as well.

    Unfortunately, most people relying on public transit and LA Metro don’t fit the “I own a private yacht/Cessna, and I own two homes one in the City of LA and the other in Avalon, and I split my times between the two every month” demographic.

    And how would 25 cents for shorter rides not make any sense? A car that can fit four passengers that gets 20 mpg at $5.00/gal gas can cost less than $0.0625 per person to travel 1 mile. For all it’s worth, anybody with a car can make a quick buck and gas money while commuting by picking up passengers that are waiting for the bus and charge each passenger 10 cents per mile for it.

  36. Frank M.

    Where was I discussing two houses and where are you inferring this from? Avalon does not have many services that people require so yes they do go to the mainland. Since you have some prejudice against people who live in Avalon, you can apply the same concepts to people in Topanga or numerous communities in LA County. Some places simply will be difficult and expensive to provide transit to.

    I have already stated on here how Metro will lose even more money by charging less money for services and this goes to the whole Avalon example as well. By not providing the ferry service, Metro is losing customers. However, by providing the service they would lose much more money. The same goes for 25 cent fares. Exact same concept….

  37. Frank M.,

    One last time I will try to explain this. Lets use your car example. Say the car has one passenger paying $1.50 for a trip, but has room for two more passengers. They now drop the price to 25 cents. Say 6 people now want to board. They pick up the other two and leave the other two in the cold. Now they have 3 passengers paying a total of 75 cents and two furious passengers they have left on the side of the road. Before they had one happy passenger with plenty of room paying them double what they are getting now.

    In reality it is much worse than this, because our busses and trains are not 3/4 empty. Also, it is doubtful you would suddenly have a flood of passengers just because the fare for a short ride is 25 cents. $1.50 isn’t exactly a lot of money. Back in the 80s, the fare was $1.00 when that $1.00 would really be like $2.00 today and people rode the busses as much if not more than now.

  38. Matt,

    There’s no need to explain. Clearly you and I differ on opinion and approach to fares. If your logic makes any sense, then people will be just as fine in paying $5.00 per ride whether or not it’s a mile or 20 miles and assuming that people will continue to ride the bus or train when cheaper options exist now to travel 20 miles now.

    I personally do not want Metro to make the same debt ridden mistakes as NYMTA and Boston where fares keep rising, raising taxes, and making service cuts as a means to try to dig themselves out of bigger debt, when all it does is do the opposite approach to dig themselves deeper into debt.

    And your example is flawed. Note the term short rides. Stop thinking of longer rides where riders just sit or stand there for 20 miles of transit that there’s no room to add anymore passengers. The first passenger only riding the car for $1.50 will likely ride along the car for longer trips. In the end, the car driver only makes $1.50 from that one person who just sits there for the entire 20 mile length of the trip.

    Short rides means higher flow of passengers getting on and off. By going to a cheaper, variable, distance fare model of 10 cents per mile, the car driver gets to pick up a lot more passengers. 30 cents from passenger A going 3 miles + 50 cents from passenger B going 5 miles, $1 from passenger C going 10 miles, $2 from passenger D going 20 miles. And at each stop, there will be more people getting off because cheaper distance based fares encourage shorter trips, to make room for additional passengers who have a variable need of shorter and longer trips. Cheaper fares allow for more quicker, shorter trips to be done which keeps the flow of passengers faster. More passengers, more shorter trips, more quicker flows, more room for passengers.

    A flat fare of $1.50, you only have one person sitting there using up space that could be better used for more shorter, quicker trips. It’s not much different from how cars just sit there in the parking lot eating up valuable seat space. If you think about it, it’s a form of congestion pricing for passengers on the bus or train based on travel distance.

    You mentioned Metro 720 being so full? Why is that? Maybe because most of the people riding on that bus are using it for longer trips all the way from Santa Monica to the Red Line, which make no room for commuters that want to get on at a mid point like Miracle Mile to the Red Line.

    But there has to be Westsiders that go to work or shopping at Miracle Mile too right? So then why is Wilshire still so packed with cars? Maybe because it’s just as that; riding the bus from the Westside to Miracle Mile isn’t worth it as going from Westside to the Red Line stations. It’s still cheaper to drive from Westside to Miracle Mile because why pay $1.50 or $75 per month on the Metro 720 to travel a shorter distance when driving the car from the Westside to the Grove still comes around cheaper than paying $75/month.

  39. I used to ride 320/720 from West LA to Wilshire/Western all the time. Most passengers did not ride this far at all. In fact most sat on for a few miles and got off in places like Beverly Hills and the Miracle Mile. In fact, people were often surprised I would ride all the way to the Purple Line where I continued Downtown.

    I know you think that is not possible that people would ride an “expensive: bus for 4-5 miles, but there are plenty of reasons why it is actually cheaper.

    1. $1.50 is just not a lot of money except to the very poorest and $75 a month is way cheaper than owning a car unless you go illegal and don’t register and don’t insure it
    2. You mention gas as the only variable in the cost of driving a car, which is of course wildly incorrect. You have to account for maintenance for things like tires, brakes, belts, oil changes and so forth which add up, as well as repairs and depreciation on the car. The IRS allows for business reimbursement for car usage at over $.50 a mile.
    3. Some people work for employers that simply offer to buy Metro passes for employees.
    4. CA law mandates that employers with over 50 employees must provide the cash amount to their employees in lieu of parking. In LA that is often way over $75.
    5. Some places do not provide parking at all for their employees (i.e. most of Downtown).

    Reducing the base fare below $1.50 would destroy a lot of Metro’s revenue and result in lower farebox recovery and a bankrupt system, which is why systems throughout the US, even those that use distanced based fares, actually have base fares around this level or even higher.

    One problem with distanced based fares on busses that I don’t see addressed here is how would you handle cash paying passengers on the busses? Drivers don’t have time to deal with selling TAP cards. That is a real problem, especially for visitors and occassional users who don’t want to have to use a TAP card. Even if they could sell TAP cards, how much would you make a passenger load up onto it? Say they just wanted to go a few blocks and pay 25 cents. How does the driver know how far they really intend to go?

  40. Matt,
    $1.50 is expensive on the eyes of the beholder depending on distance traveled. Paying $1.50 for a mile worth of ride is dumb if there are cheaper alternatives like walking, biking, using a Segway, using a kickboard, a skateboard, a moped, and even driving a car.

    What you’re saying is essentially this: pay $1.50 for an M&M, it could be anything from a single M&M to a jar full of M&M. Who’s going to pay $1.50 for a single M&M? If it’s going to cost the same $1.50, most people are just going to buy a jar full of it. Duh, and the person selling the M&Ms goes broke because he expected people would also pay $1.50 for single M&M as well.

    “One problem with distanced based fares on busses that I don’t see addressed here is how would you handle cash paying passengers on the busses?”

    I thought you were an expert in mass transit in Asia and are for distance based fares. Oops, looks like you don’t know anything then. If so, you wouldn’t be asking this question and instead would actually give out examples how Asian transit agencies do distance based fares on their buses. Don’t you think this question would’ve been answered by them if they run distance based fares on their buses?

    For starters, why don’t you use Google to see how Asia figured out how to do distance based fares work in Asia on buses?

  41. Frank,

    Most people in LA use passes. Are you going to eliminate monthly, weekly and day passes since they are flat fares? If not, won’t people still ride the long distances you are trying to discourage so you can open up room for people just going a stop or two?

  42. Matt,
    Here are my rebuttals as a short distance rider:

    1. You just compare mass transit with car ownership. I, along with increasing number of Angelinos do not own a car and are not reliant on public transit for shorter rides. How do I get to work? With a Vespa. Did that alternative ever cross your mind?

    2. If I only end up driving a short distance, my cost of maintenance and upkeep of my Vespa is low as well. So is my gas. Did I mention my Vespa gets 100 MPG?

    3. And a lot of employers don’t either.

    4. Yes, but that law only applies to employers who uses leased parking spaces. And a large amount of businesses in LA don’t subsidize parking spaces. I work at the mall at the Beverly Center. They give me free parking because Beverly Center owns the mall. Do I get a parking cost reimburse should I decide I don’t need it? No, they just make my space available for mall patrons.

    5. Not everyone works Downtown. Downtown is not the only place where people work. People work at supermarkets, pharmacies, shopping malls, movie theaters, factories, gas stations, hotels, airports, hospitals, etc. etc. Expecting everyone that works in LA has a white collar office job in an high rise in Downtown LA and everyone else who doesn’t is out of the picture is nothing but elitist. People who work in Downtown LA only make a small minority in a big cityscape full of businesses all over the LA Basin.

    “Reducing the base fare below $1.50 would destroy a lot of Metro’s revenue…”

    The Culver City Bus and the Santa Monica Big Blue buses runs perfectly fine with a flat rate fare of $1.00 which is cheaper than $1.50 that Metro charges. How can they do that? Maybe its because they run shorter distances. Shorter distance, cheaper price.

  43. Matt,

    I suggest you read this. It’s a legislative analysis paper from Hong Kong that was done back in 1996. Don’t worry, it’s in English.

    Especially of key note interest is pages 8-10 as it provides all the logic of distance based fares over flat rate fares.
    http://www.legco.gov.hk/yr97-98/english/sec/library/956rp14.pdf

    Hong Kong, Singapore, London gets 100% of their operating costs funded solely through fares. Not a single penny of government funds went to their operating costs.

    Tokyo and Osaka, less than 10% of government funds were used to keep their transit systems running. Majority of their operating costs came from fares and commercial venues.

    In contrast, NY which runs on a flat rate system, and supposedly the best system in the US, back then still had to rely close to a 1/3 of their operating costs on government subsidies and taxes.

    And I’m sure if you’ve been to Asia, how our transit systems are way better than any transit system in the US, including NY, right?

  44. “Are you going to eliminate monthly, weekly and day passes since they are flat fares?”

    Cities that use distance based fares also offer unlimited ride passes as well.

  45. Former HK resident,

    Once again, I am not opposed to distance based fares. There would be a lot of implementation problems with it if adopted, but they could be overcome, although the ones on the bus would be more difficult.

    You make the assumption that the reason these systems achieve higher farebox recovery simply because they have distanced based fares, but that is simply not true. In London for examply, using the Tube is simply much more expensive than here (a very short Tube ride costs something like the equivalent of $2.50). Of course, it is in a city where parking is severly limited, gas costs nearly $10 a gallon, and you get charged a toll for going into the center of the city. If LA charged Tube prices, a lot of people would simply say it is easier for me to drive. In London that is not the case, because of those factors.

    Look at the US, Chicago and NY achieve around a 55% farebox recovery ratio with flat fares and DC and SF achieve slightly better with distanced based fares. Their ratios are higher than here, because they charge more. A 22 mile trip on the Blue Line that costs $1.50 might cost $4 in DC or SF and it might cost something like $6 in London.

    People here think distance based fares are some sort of magical elixir that means that Metro would charge 50 cents for a short trip and $1.50 for a longer trip or something along those lines and suddenly make a bunch more money. Not realistic. The numbers don’t work. Those type of numbers don’t work in London or anywhere in the US either.

  46. Here’s the thing. I ride my bike to work.

    I don’t do it because it’s chic or hipster thing to be on the bicycle. Nope, I do it because paying for the bus isn’t worth it for 2 miles. Metro lost my business to the bicycle with their fare policies.

    Matt, if Metro decides to move to distance based fares one day, would you want to ride the bus or train that started off at $1.50 when all you want to go is one or two miles, or the next station over? I bet you do not. You will, just like me, opt to ride a bicycle instead. Starting off at $1.50 is not cost effective way to attract new riders from the short distance market.

    You may think it’s “only $1.50,” and that lowering it any further for shorter distances only hurts Metro. I say it’s the exact opposite; the existing policies are the primary cause that’s hurting Metro today. I’m the living example of that right here. I don’t ride Metro, I refuse to pay $1.50 for a short 2 mile ride to work, hence I’d rather ride the bicycle. Therefore, Metro gets absolutely no ridership nor revenues from me.

    For those that have shorter commutes, a $1.50 per ride on a short distance translates to $3.00 per day. That’s $15 per week on a 5-weekday work schedule, or added up over the year, would equate to about $780 per year. Doesn’t sound so cheap now does it? Or what, am I going to pay $75 per month, or $900 a year for a monthly pass (that’s $120 more!) just for the sake of commuting a measly 2 miles? Forget it.

    Can I afford $3 per day? Of course. But would I want to pay $3 for a short 2 mile commute in each direction when I can just as easily bike that 2 miles? Who in their right mind would want to do that? Just like Frank M said, anyone can afford $1.50 because “it’s only $1.50,” but no one is stupid enough to pay $1.50 for a single M&M either. If you think otherwise, you clearly underestimate the ability for Americans to do simple math.

    When looking at saving out $780 a year for a short commute, the bus and train isn’t worth it. I’d be better off just bicycling that one or two miles to save $780 a year and use that money to buy a new iPad instead. What Metro ends up is getting nothing from me because they expect that I will pay a rip-off price of $780 a year for one or two mile commute.

    Now if Metro institutes a distance fare plan that starts off with 50 cents for the first mile and 10 cents every mile after that, at least they would get $0.60 from me for the two miles of commute. Add the roundtrip cost over the entire year, Metro would be earning $312 from me on a cheaper distance fare plan instead of nothing from a $1.50 flat rate plan.

    Sorry, their poor fare policies only pushed me away from using public transit to the bicycle. And I’m sure there are a lot more people who feel the same way as I do. Cheaper options exists for short distance commuters that only end up making Metro not even gain ridership or revenues from us.