Rail is losing riders and money; yet cities keep building them

The Search for the Holy Rail
Rail transit systems all over the country are losing riders and hemorrhaging money, yet city governments keep building them.
by Rachel DiCarlo
03/13/2003 12:00:00 AM


Rachel DiCarlo, editorial assistant

IMAGINE THIS SCENARIO: The CEO of a large corporation calls a meeting of the board of directors to deal with a crisis: The business is losing four dollars for every dollar earned, much of the capacity goes unused, and the customer base, never large to begin with, is eroding at an alarming rate. The board huddles and after a lengthy session the solution emerges: Expand.

Hard as it is to imagine that any business would "solve" a problem this way, the description accurately sums up the state of rail transit in this country. In all but a handful of American cities where it exists, transit ridership is flat or declining, cars run half-empty, and the system hemorrhages money. Take Baltimore, for example.

The city's heavy-rail subway carries 50,000 commuters per day, half the 100,000 daily ridership originally envisioned. The situation is even more discouraging when it comes to revenue. Although mandated by law to recover 40 percent of operating costs through the farebox, the subway took in just $10.3 million in 2001 while operating costs were $30.3 million. Maryland taxpayers made up the difference.

Baltimore's light rail, an above-ground trolley, is in even worse shape. The hastily built, single-track system only garnered $8 million in revenue in 2001, while it cost state taxpayers $32.4 million. Its near empty cars are the embarrassing legacy of former Governor William Donald Schaefer, who built the line to shuttle baseball fans to and from Oriole Park at Camden Yards. Since opening in 1992, the original route has had other lines cobbled onto it, yet the entire system still runs far under capacity, carrying only 30,000 daily riders.

None of these problems deters supporters, who see rail transit's dismal performance not as proof of its failure, but as evidence that still more needs to be built. The Baltimore Sun recently reported that Maryland state officials are aggressively seeking federal funds for a project that would extend the city's subway from 43 miles of track to 109 miles at an initial cost of $12 billion. Transportation officials believe this ambitious expansion will boost ridership to the extent that the city's system will rival the heavy rail Metro in Washington, D.C., which carries 643,000 riders per day.

UNFORTUNATELY FOR TAXPAYERS, Baltimore is not unique. Other cities that have experienced the disappointing results of rail transit are forging ahead with plans to build more. Among them is Portland, which has the nation's most aggressive "smart growth" policies.

Over two decades, Portland has gotten hundreds of millions of dollars for its two existing light rail lines only to see the share of commuters using them drop 20 percent. As of 2000, just 80,000 of the 6 million daily trips made in Portland were on rail transit--about 1.3 percent. And the city's traffic conditions are as bad as ever. The Texas Transportation Institute reported that Portland had third worst traffic congestion in the 1990s, behind Los Angeles and Washington. Still, a third line is scheduled to open in Portland in 2004.

The situation in San Jose isn't much different. The city opened its first light rail line in 1988. Although original estimates projected that it would carry 40,000 riders per day, the high-water mark occurred in 1998 with an average daily ridership of just 22,700. Today San Jose's light rail cars carry fewer than 15 people at any one time. By mid-year the system is expected to fall a whopping $6 billion short of the money it needs over the next 20 years. Yet in the 2000 election, voters approved a referendum for two additional lines which are scheduled to open in 2004.

But the problems are not confined to small cities. In Los Angeles, the city with the worst traffic congestion in the country, rail transit's market share is 270,000 daily trips out of a total of 65 million, about 0.4 percent. Miami is about the same: Of 15 million daily trips, only 55,000 are on rail transit, about 0.4 percent. And in Dallas, where $17.2 million of federal money was spent on three light rail branches and a commuter line, just 0.25 percent of daily trips are made on rail transit.

Still, almost two hundred other cities around the country have requested federal money for rail transit. Demand has become so great that sparsely populated places like Sioux City, Iowa, Harrisburg, Pennsylvania, and Staunton, Virginia, want federal money for their own systems. The twin cites of Minneapolis-St. Paul, one of the nation's least dense urban areas, have begun construction on their Northstar Hiawatha light rail line. If the new system were to pay for itself, commuters would have to fork over $19.00 per trip or $8,550 per year--enough money to lease a luxury SUV.

WHY HAS RAIL TRANSIT been such a spectacular bust? Experts cite a number of reasons, one of which has to do with the way the systems are configured.

Most rail transit is built to serve the downtown business districts in cities. But the days when downtowns functioned as the primary centers of employment are long gone. Since about 1955, when people and office equipment began taking up more space, most new jobs have been created in industrial parks and small office parks--areas outside of downtown. Now, less than 10 percent of the nation's employment in metropolitan areas is located in the old central business districts. So for more than 90 percent of commuters, rail transit isn't an option.

Yet this fact is not an argument for extending rail transit into the suburbs. Employment outside of downtown areas is spread too thin to support rail transit. And any system serving the suburbs would have to include an expansive shuttle network to ferry commuters from transit stops to their homes or offices. So far, commuters have shown little interest in such a system. As transportation expert Wendell Cox puts it, "The problem has to do with the environment transit tries to serve. There is not a transit situation that can be superimposed on [a large city] that can get people to and from and around the suburbs."

So is there a place for rail transit anywhere?

If it makes sense at all, rail transit only seems to do so in the nation's largest cities like New York and Chicago, where more than 30 percent of commuters ride transit to work. But in other places the numbers plunge. And where transit extends into suburban edge cities, like Bethesda in suburban Maryland, or Perimeter in Atlanta, the trip share of rail transit is miniscule.

But there is an even more compelling reason rail transit will never be a serious transportation alternative in more than a handful of places: It can't match the convenience of cars. Most people prefer to come and go on their own schedule, not one set by a mass transportation authority. Plus, in cars they can travel privately in much less time than a typical transit trip takes. Transportation consultant Alan Pisarski estimates that in most situations the average auto travel time is less than half that of rail transit.

What's more, people do a lot of "trip-chaining." That is, they make side trips while they are out. A trip to the dry-cleaners might include a side trip to the bank, to the pharmacy, and to the day-care center. No transit system can replace the convenience of cars for these kinds of needs.

BUT DOESN'T mass transit ease traffic as supporters contend? The evidence shows otherwise. Between 1960 and 2000, 1,500 new miles of transit were built and 64 million new jobs were created. During the same time frame, 71 million more commuters drove to work and 1.7 million fewer rode mass transit. In Washington, D.C., where the high ridership volume makes the subway somewhat of a success (though not a profit maker), the traffic is still the second worst in the country. "There is no documented case of mass transit making a material traffic reduction anywhere in the United States," Cox says.

If the average commuter--the one who keeps voting for rail transit expansions--can be forgiven for not knowing the facts, what about elected officials and their advisers? Why do they consistently show such a willful disregard for those same facts? The answer has to do with several different groups which support rail transit. There are those who despise cars, roads, and SUVs, and want to limit them as much as possible--the "smart growth" types who would be perfectly happy to see people living the way they did 100 years ago. They subscribe to the "Field of Dreams" justification for transit, the idea that if you build it they will come.

Then there are the civic boosters, whose desire for rail transit stems from the same impulse that motivates politicians to fund expensive stadiums to lure sports teams: The desire for status. As with big-time sports, most cities believe that they are not "big league" unless they have an extensive rail transit system. And lacking justification for the massive amounts of money it involves, rail supporters often appeal to civic pride as a way around economic accountability.

In Baltimore, Mayor Martin O'Malley has come up with the novel justification that "if we don't have any better mass transit 20 years from now than we have today, we are going to be continually chasing our tail." But, when it comes to rail transit, it's the taxpayers who are chasing their tails. And they will continue to do so. That is, until they demand a reckoning of costs versus benefits and insist that elected officials at all levels stop making decisions that would get any CEO and his board of directors fired for incompetence.

Rachel DiCarlo is a staff assistant at The Weekly Standard.