August 22, 2001
Opinion Editorial
By Dennis Polhill, Matthew Edgar
The Regional Transportation District (RTD) will not allow Coloradans to have real transit solutions such as jitney service. A jitney is a privately owned minibus that carries passengers from point to point on a flexible schedule.
In 1989, the Florida legislature accidentally created a legal loophole that permitted competitive, unregulated services like jitneys. Within months, over 20 jitney firms had emerged to serve the accidentally created market. Before this loophole, certain regulated jitneys were allowed to operate in conjunction with the Miami version of RTD, Metrobus.
The new jitney services provided faster trip times, shorter wait times, flexibility in boarding locations and drop-off points, and availability of service in late evening. The largest advantage jitney service had over Metrobus in Miami was trip speed and ease of boarding. In order to board the jitney, the passenger would simply flag down the jitney from any place along the jitneys route not just bus stops fixed in inconvenient locations. In this sense, it acted much like a taxi service. In addition, the jitneys would run on time in order to satisfy their customers. The irony in Colorados ban on jitneys is that the largest complaints made by RTD passengers are: trip times are too long; the buses are routinely off schedule; the bus stops are not conveniently located; and, that RTD does not provide late night service.
Because of the benefits of faster trips, shorter wait times, better travel times, and flexibility in stopping locations, the Miami jitney services were able to establish a market of their own. In the first year, the jitney services attracted 43,000 to 49,000 passengers per weekday. That breaks down to about 110-115 passengers per vehicle per weekday. Most of these passengers said that if not for the jitneys, they would take their own car: a new market was created solely for jitneys in Miami.
In addition to all the other benefits, the jitney service was much cheaper. With no government subsidy, the jitney service was able to charge $1 per passenger, whereas Metrobus charged $1.75. RTD charges $1.75 for peak hour travel, and 75 cents for non-peak travel (to which is added a state and federal subsidy worth four times that amount). To repeat: that $1.00 was the average jitney charge in Miami, without subsidies from the government.
Despite the benefits of faster trips, shorter wait times, flexibility in boarding, and late evening service, Miami ended legal jitney service in 1991. The various jitney services operating without regulations were charged with operating without a license. The fine for the crime of for-hire transportation of people was a charge of $100 to $500 and/or up to 10 days in jail. The reason for ending jitney service was political. The government simply did not feel comfortable allowing the private sector to compete against a public sector monopoly bus system.
This was evinced before the loophole was started. In March 1983, the Board of County Commissioners in Miami questioned the conflicting policy of support for private sector and public sector transportation services. The commission chose to support protecting the monopoly by restricting jitneys from large Metrobus areas. A large Metrobus area was defined as any area in which jitney service would have a serious negative impact on existing service. According to the commissioners, that was ample reason to close the loophole.
Is the argument that jitneys hurt a government-controlled monopoly a worthwhile defense for ending a beneficial service? No. Moreover, is it any reason not to allow jitneys in Colorado? Again, the answer is no. Some make the argument that there is no jitney market in Colorado. No one can answer this question until we actually conduct an experiment in free market jitneys.
In Colorado, most people who do not ride RTD do not ride because it is slow and often off-schedule, bus stops are inconvenient, and routes do not travel to the desired destinations of passengers. All these problems with RTD provide market room for jitneys to provide service. In other words, the jitneys market would be those who are not satisfied with RTD. A potential market 10 to 20 times larger than that served by RTD may be available for jitneys. If a demonstration found only a fraction of that to be true, the positive impact on traffic congestion at no cost to taxpayers would be immediately noticeable.
Some will still ask, But what about the hurt government monopoly? If RTD loses passengers then they have an incentive to improve and help passengers. Thus, there is really no need to negate a good service like jitneys for the sake of protecting an inefficient government monopoly. That is what happened in Miami when the government, after only a few months of jitney service, closed the jitney loophole.
By not allowing jitneys, we are forced to choose between riding a slow and inefficient service and driving on congested roads. Jitneys are one solution to decreasing congestion and challenging the government monopoly to improve service.
Dennis Polhill is a Senior Fellow at the Independence Institute, and Matthew Edgar is a summer intern at the Independence Institute and a junior at the University of Denver. They wrote this article for the Independence Institute, a free market think tank in Golden; http://www.i2i.org
