Opportunity costs & capital costs

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Passenger rail in Bratislava, Slovakia.

The case for rail has always been pretty straightforward: it’s the highest-capacity transit solution available. You can transport a lot more people on a three-car light rail than on a bus. Another big advantage: trains generally run in dedicated right-of-way; they don’t get stuck in traffic.

Although you can set up a bus-rapid transit (BRT) system where buses run in dedicated, separate lanes from cars, they have rarely been successfully implemented –– many systems suffer from “BRT creep,” where due to political pressure/lack of funds, the system does not end up featuring all of the key benefits of BRT, notably dedicated lanes and traffic signal priority. With rail, you don’t have to worry about this as much, since these features are inherent to the system (dedicated right-of-way etc).

So trains can carry a lot more people easily and are generally a better bet than buses to deliver reliable, high-frequent service.

And there’s another benefit: lower costs per passenger. At a certain point, it’s cheaper to scale up a rail system. If the demand becomes too high at one station, you just add another car to the train. You don’t have to hire another operator to drive another vehicle, as would be the case with a bus. Indeed, one of the major weaknesses of bus systems is that it’s expensive to add capacity, largely due to the high cost of paying another driver.

But there are two big reasons why even a growing city like Austin may consider forgoing rail in favor of a bus rapid transit (BRT) system: opportunity costs and capital costs. Rail takes forever to build and costs a fortune to build.

If we approve a rail bond in 2020, the rail system may not be built until near the end of the next decade. There’d be a lengthy local planning process, along with a lengthy funding/ environmental review process with the federal government. What are the opportunity costs of spending nearly another decade stuck with the current, sub-standard transit system? BRT would take a while to implement as well, but it would very likely be completed several years sooner than rail. So maybe we’d have to wait four years instead of seven or eight.

Meanwhile, you have to spend a ton of money. Cap Metro has estimated (for what it’s worth) that it would cost $2.4 billion for North Lamar/Guad and another $1 billion for South Congress. It would cost hundreds of millions less to set up a “true” bus rapid transit system with dedicated lanes and other features that will make it as close to a rail experience as possible.

Many transit advocates believe that a rail system will attract higher ridership than even a really good BRT line. Among other reasons, trains provide smoother rides and have a certain je ne sais quoi that buses lack. But how much higher would the ridership be? And how much are we paying for that additional number of riders? Were they worth the hundreds of millions of extra capital cost we put into the system? Or the years we waited before having a good system in place? Even if ridership on that corridor improves, how much of a benefit to the total system would that one or two new rail lines provide? Could we more cheaply boost transit ridership all over town by investing in a few BRT routes along with making further enhancements to regular bus service?

The other thing: concerns that BRT won’t be able to scale with rising population due to the high operating costs may eventually be obsolete. If Cap Metro CEO Randy Clark is to be believed, autonomous buses are coming sooner or later. If you build BRT –– running in a protected lane that cars can’t access –– then you can eventually transition to driverless buses, as Clark envisions.  The benefit of autonomous transit is not simply that we won’t have to pay as many drivers, but that the vehicles will be able to communicate with each other and “platoon” in response to high demand. Rather than one bus awkwardly tailgating another, the two computer-operated vehicles will travel in absolute unison.

In Austin, the potential challenges presented by rail should be intuitive. They’re on full display on the red line, the commuter rail line that Cap Metro senselessly built in 2010. The train is great for the relatively small number of people who use it. But the ridership has never justified the cost. It also has diverted valuable resources from worthier endeavors. Because we’re spending $19 per passenger on the red line, we’re prevented from investing in more productive bus routes

Plus, it’s an argument that even rail supporters have made. Four years ago a number of people who had long advocated rail decided to oppose the route proposed by Cap Metro. They argued that the obvious choice for a rail route was the N. Lamar/Guadalupe/South Congress corridor, which already generates the highest bus ridership. Due to a number of reasons, Cap Metro opted for a different route running between Highland Mall and the Airport, which some longtime rail advocates saw as foolish and unlikely to generate the necessary ridership to operate cost-effectively. As eager as they said they were to support rail, they wanted to do it the right way, and this wouldn’t be the right way.

Many of the transit activists who opposed the Highland Mall route said they would support rail on Lamar/Guad/SoCo because it could generate the necessary ridership, but that BRT would be a better fit for Highland Mall/East Riverside.

Now, as Cap Metro tries again to get a plan for high-capacity transit system approved, it’s very likely that agency leadership feels that rail may never be a better bet than a good BRT system that will take much less time and money to get up and running. And politically, the promise of autonomous technology that could eventually make BRT even better provides them a defense against accusations that they lack ambition or are afraid to go big. Those are certainly the signals Cap Metro and the Cap Metro board appear to be sending.

2 thoughts on “Opportunity costs & capital costs

  1. “If the demand becomes too high at one station, you just add another car to the train. ”

    But in practice, how often does this actually happen for light (not heavy) rail? Especially light rail on urban arterials (not highway medians).

    Seems like frequently the station size, distance between intersections, curves in the route, etc. preclude this.

    In practice, you usually do end up with higher capacity in light rail (assuming you don’t go with triple section articulated buses, which is mostly theoretical). But it seems to be more like 50% more, not “keep adding cars for as much capacity as you want”.

    Like

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