Funding Seamless Transit (Part 3): How a Bay Area network manager could simplify the funding madness
Do Local Funding Discrepancies Undermine a Network Manager?
Given the importance of local funding to Bay Area transit, maintaining an effective balance of regional and local control over funding will be critical to setting up a network manager for the Bay Area.
In Part Two of this series, we established that there were five main categories of funding sources that fund transit, with farebox and local funding being the largest sources. We also highlighted reasons why there may be debate over the definition of “Local funds.”
The existence of such funding discrepancies, e.g. the definition of “Local funds” and a fair approach to revenue and cost sharing for a regionally significant core transit service network -- are not reasons to avoid a network manager; they are exactly the kinds of tasks that a network manager is best positioned to address.
How could a Bay Area network manager simplify the funding madness?
A network manager could completely overhaul and simplify the funding system through sweeping changes, or it could sweep them under the mat so that the system appears to have simple funding systems while internalizing all the complexity. It could also do something in between; the decision is in the hands of the regional leaders who negotiate the founding of the network manager.
An example of a funding structure that makes relatively minor changes would be one in which the network manager only collects and redistributes fare revenues and leaves the other funding sources as they are, as Hamburg did. Alternatively, a dramatically simplified structure would be one in which the network manager assumes responsibility for funding all transit in the Bay Area by replacing all extant transit-supportive taxes and fees with uniform regional taxes and fees in addition to collecting and redistributing fare revenue, as Zurich did. There is also the option of introducing a new regional source of funds, which would grow the financial pie and make it easier to get all operators on board with the integration, as Toronto did with provincial funding. Any of these solutions has the potential to be an improvement over the status quo, as are a multitude of funding arrangements besides these.
As discussed above, service standards must be regarded as minimum allowable service levels; local governments should feel free to provide more, but are not allowed to provide less. A recent example of why such minimum standards are important is the indefinite suspension of the AC transit M Bus, the only transit service across the San Mateo Bridge that connects Hayward with San Mateo county. Such an important link should almost certainly be part of the region’s core transit network and not be subject to suspension of service simply because it falls outside the responsibility of any one of the Bay Area’s 27 transit agency boundaries.
The designation of minimum service standards for certain regionally significant routes - funded by a shared regional funding source like fares - allows local governments to continue to utilize local taxes to pay for the expansion of local services without the fear that those monies will be snatched away by the network manager to pay for services in a different jurisdiction. We agree that there must be a clear nexus between local funding and local service.
Network Managers = Real Benefits for Riders
While a change to a network manager might seem risky, many regions have gone down this path in places ranging from Hamburg to Barcelona to Sydney to Vancouver, and none have declared the experiment a failure. In region after region, monocentric or polycentric, German-speaking or English-speaking, regionally governed or decentralized, federal or unitary, dense or sprawling, the creation of a network manager was followed by a boost in per capita revenue and ridership, as well as increased public faith in transit. This increased public faith, in turn, can be used to build momentum for more difficult transit projects such as large infrastructure projects or securing more funding for transit. By consolidating planning and scheduling, choosing capital projects according to a cohesive regional plan, and being the regional champion of transit, a network manager could unlock a level of performance, public confidence, and resources of which today’s planners can only dream.
Local funding is complicated -- but that complexity shouldn't be visible to the rider. One of the points of the network manager is to hide that complexity or eliminate it altogether to create a transit system where the differences between the agencies does not inconvenience or harm the transit rider. There are proven network management structures that can ensure equity and fairness of funding, but only if partners in all parts of the county are willing to engage in honest negotiation with a commitment to a greater regional vision of connectivity and access.
We look forward to the upcoming network management business case, expected to kick off in November, for the further analysis of the right network manager structure for the Bay Area that both addresses the needs for centralized decision-making while reflecting the unique aspects of our region.