How much does a transit trip cost? How does the subsidy a transit trip vary from trip-to-trip, passenger-to-passenger, and system-to-system? How does the of public transit patrons vary among various classes of transit users? These are important matters of public policy that have received surprisingly little attention in the research literature in recent years.
The cost of producing public transit service is not uniform, but varies by trip type (such as local or express), trip length, time of travel, and direction of travel, among other factors. Yet the models employed by public transit operators to estimate costs typically do not account for this variation. The exclusion of cost variability in most transit cost allocation models has long been noted in the literature, particularly with respect to time-of-day variations in costs.
This analysis addresses many of the limitations of cost allocation models typically used in practice by developing a set of models that account for marginal variations in vehicle passenger capacity, capital costs, and time-of-day costs using FY 1994 capital and operating data for the Los Angeles MTA. This analysis is unique in that it combines a number of previously and separately proposed improvements to cost allocation models. In comparison to the model currently used by the MTA, we find that the models developed for this analysis estimate: higher peak costs and off-peak costs, significant cost variation by mode, and lower costs for incremental additions in service. The focus of this study is on the limitations of the rudimentary cost allocation models employed by most transit operators, and not on the MTA per se. This analysis finds that an array of factors addressed separately in the literature can be simultaneously and practically incorporated into a usable cost allocation model to provide transit systems with far better information on the highly variable costs of producing service.