Research Project Description
Project Number: 2904
Project Objective:
Documenting public transit service management and operation in the New Orleans region under privatization and examining whether or not a contracting firm can provide more cost-efficient, cost-effective, and coordinated service across jurisdictions.
Principal Investigators:
Hiroyuki Iseki, Ph.D., Assistant Professor, Department of Planning and Urban Studies, University of New Orleans
Team Members:
Charles R. Rivasplata, Ph.D., Lecturer, Department of Urban and Regional Planning, San Jose State University
Project Abstract:
Suburbanization and declines in population, jobs, and business in the inner city have caused a significant loss in the local tax-base of these areas, preventing them from funding public services. In contrast, affluent suburbs have enjoyed relatively stable or even increasing tax revenues. At the same time, many transit dependents in the inner city have limited access to the automobile and remain there.
These conditions create a situation that makes regional transit coordination very difficult. First, the distribution of transit service is largely driven by a desire to ensure geographic equity, where transit service is expanded to suburban areas, resulting in lower levels of efficiency and effectiveness. Second, individual transit agencies focus on local services, and do not effectively address the needs of regional transit users that travel across transit systems. Third, in addition to general service improvements, marketing and customer service, the adoption of new technologies (e.g., smart cards, automated vehicle location system, next vehicle arrival notification system) is problematic in a regional transit system because each transit agency has a different level of demand as well as different funding priorities. As a result of political and administrative conflicts among transit agencies, regional coordination is very difficult to achieve, posing challenges to the provision of a viable transportation alternative for transit dependents.
The current situation in Greater New Orleans region represents a unique case in which one private firm has been contracted by two jurisdictions, Orleans Parish and Jefferson Parish, to manage and operate transit service. Historically, many U.S. transit agencies have turned to this sort of service contracting to pursue higher cost efficiency and effectiveness, especially in the face of both declining state and federal aid. By 2000, more than one third of U.S. transit agencies with fixed-route bus services contracted out part or all of their service, spending an estimated total of $4.3 billion for contracted service (or 13.4 percent of total operating expenses) in 2006. Nevertheless, most policymakers know little about the effects of privatization as a service provision strategy.
Accordingly, this study will examine the possibility of introducing significant service improvements regional transit coordination and economies of scale through privatization, taking into account difficulties in achieving coordination among multiple public agencies, as well as incentives needed for a private firm to pursue more cost-efficient and cost-effective operation. In addition, the study will examine the efficiency and effectiveness of providing transit service at each of these two agencies in New Orleans, carefully taking into account the conditions for regional transit service in New Orleans.
In order to address these issues, we will conduct an in-depth study of two cases of transit service contracting in Greater New Orleans. We will examine various documents (e.g., government reports, requests for proposals, contracts) and analyze available data, such as the National Transit Database and data from local transit agencies, as well as transit user survey data. We will use this data to examine and evaluate: 1) conditions of transit finance, management, and operation in the region over a specified period, 2) processes and contractual terms of transit service outsourcing, 3) transit service performance, and 4) regional transit coordination. We will examine not only factors that are easily quantified, such as cost efficiency measured by cost per vehicle hour and cost per vehicle mile, but also service quality from the viewpoint of the users. These factors include the level of user satisfaction with a variety of service components, such as safety, security, on-time performance, information, and amenities.
Task Description:
Task 1: Literature review
Conduct three literature reviews: 1) to identify cases in which public transit services had to be restored from the damage of natural or human disasters, 2) to have an overview of transit service improvements that enhance transit users experience and perceptions, and 3) to see how privatization can facilitate improvements in regional transit coordination and documentation of findings of these three literature reviews. Please note that part of 2) has been conducted in the ongoing research project.
Task 2: Collection of documents and data
We will collect academic articles, government reports, and newspaper articles for documentation of transit service in Orleans and Jefferson parishes before and after Hurricane Katrina. We will also collect government reports, reports prepared by the staff at public agencies, minutes of public meetings, request for proposals, and contracts between public agencies and a contracted firm, Veolia. We will also collect: 1) the basic financial and management data from the National Transit Database (NTD), transit agencies, local governments, and a contracting private firm, and 2) the basic demographic and mode share data for the two transit service areas. Collection of documents and data will be conducted again in months 8 and 9 to update information from public transit agencies and the contracted private firm, Veolia.
Task 3: Revising the user survey, selecting survey locations, and obtain an approval of a human subject study
We will revise the user survey to examine the relative importance that users place on their experience at transit stops and stations, and their levels of satisfaction. Based on the transit information acquired, we will select transit stops/stations for conducting the survey. We will also obtain an approval to conduct a human subject study from the University.
Task 4: Conducting the user survey
We will conduct the user survey at selected transit stops and stations, and process the collected data for an analysis in the next step.
Task 5: Data analysis
We will examine and analyze: 1) information of transit management, operation, and contracting from collected documents, 2) financial and operating data, and 3) user survey data.
Task 6: Documentation (a draft report)
We will write a draft of final report to submit to MTI. The report will describe the results of the literature review, examination of collected document, analysis of collected publicly available data, data from public transit agencies and a private firm, and survey data that we will conduct.
Technology Transfer:
At least one paper will be prepared and submitted to a refereed conference, such as the TRB Annual Meeting. In addition, a minimum of one paper will be submitted to appropriate transportation journals, such as Journal of Transportation Research Board, Transportation Research Part A, Transport Policy, Journal of Public Transportation, or Transport Review, Results of the project will also be disseminated through the MTI website, where those interested will be able to access the final report.
Potential Benefits of Project:
Policy makers, transit planners and managers of transit agencies can learn from the proposed research, as they consider contracting for significant service improvements, coordination of services across jurisdictions, and economies of scale for the regional transit system and for individual systems.
The user-survey part of this study will facilitate a better understanding of system interconnectivity, and will enable identification of features and attributes that increase customer satisfaction. This, combined with cost information, will allow transit managers to strategically select and implement improvements in a cost-effective way to maintain and increase transit use. Increasing ridership can increase revenue and bring other societal benefits, such as reduced congestion and improved air quality.
Collectively, the results of this research will translate into direct economic benefits through more efficient and more effective use of available public funding.
Project Funding: $59,014.00
