Category: Transportation

Like Other MAX Projects, TriMet’s Green Line Underdelivers at 10th Anniversary

By Rachel Dawson

TriMet has proven time and again that it is unable to live up to past promises. The MAX Green Line, which first opened 10 years ago, is no exception.

The Green Line is fifteen miles long and runs along I-205 from Portland State University to the Clackamas Town Center (CTC). It began as a portion of the North-South light rail alignment, which was canceled in 1988 after failing to secure voter funding. TriMet attempted to scale the alignment down to run from North Portland to the CTC, but the project was again rejected by voters in 1996 and 1998.

The plan for light rail to the CTC was later resurrected in 2001, and planning for the Green Line commenced in concert with the more recently implemented Orange Line to Milwaukie.

The alignment eventually earned federal approval in 2006. Of the total $575.7 million price tag, $478.2 million came from the federal government, $23 million came from the state, and $74.5 million came from local jurisdictions.

Of the local match, $69 million came from the City of Portland, $39.3 million from Clackamas County (the majority of which came from the county’s urban renewal funds), $23 million from the Oregon Department of Transportation, $20.5 million from TriMet, and $6.2 million from land donation and other funds.

The Green Line has failed to live up to these promised expectations:

Ridership is lower than projected. When the Federal Transit Administration completed its 2015 “Before and After Study” on the line, there was an average 24,000 daily weekday boarding rides. This is well below the 30,400 riders that TriMet predicted at entry into preliminary engineering for the line’s opening year. That number has continued to decrease to just over 16,000 average daily riders in August 2019, making up only 34% of the FEIS’s predicted ridership levels for 2025. With five years to go until 2025, it seems unlikely that the Green Line will garner the 30,500 riders needed to hit TriMet’s promised level of 46,500 boarding rides.

The line has lower frequency than promised. Trains arrive at stations every 15 minutes during peak periods and every 35 minutes at other times of the day. TriMet promised trains would arrive every 10 minutes during peak hours and every 15 during other times. TriMet attempted to blame this low level of service on a decline in tax revenues during the recession, but train frequency has not increased since the economy has recovered. Furthermore, TriMet’s total operating and non-operating revenues increased from 2009 to 2018 by 54%, and revenue from payroll and other taxes increased by 71%. The payroll tax rate will continue to go up every year until 2024, although it appears the Green Line’s level of service won’t increase with it.

Instead of the promised passengers, light rail brought increased crime to the CTC area. Clackamas County experienced heightened crime in the corridor from 2009-2012 after the Green Line opened and an increase in graffiti around MAX stops, according to a survey by the Oregon High Intensity Drug Trafficking Areas Program sent to the Clackamas County Sheriff.

Unsurprisingly, the line’s cost was higher than TriMet originally anticipated. The final price tag of $576 million was 14% greater than the anticipated cost in preliminary engineering, a difference of about $70 million.

TriMet is now planning for a 12-mile line from downtown Portland to Tigard. Elected officials from Tualatin, Tigard, Durham, and Washington County should take a sobering look at TriMet’s track record on the Green Line, the Yellow Line, and WES. It shows a consistent pattern of over-promising and under-performing. Given this history, TriMet’s projections for the SW Corridor project should not be trusted.

Rachel Dawson is a Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Shrinking Roads and Rising Fatalities Don’t Bode Well for Portland’s Vision Zero

By Rachel Dawson

Portland hasn’t seen 50 road fatalities since 1996. With 43 fatalities already, it looks like 2019 will be a record-breaking year, with no thanks to Portland’s Vision Zero Action Plan.

Placing concrete pedestrian islands in the middle of the road, giving little to no room to turn onto side streets, installing plastic pylons against the roadway, and using confusing signage and lines—all Vision Zero road changes implemented to decrease road fatalities—don’t seem to be making streets safer.

While many factors are involved, perhaps distracted and dangerous walking, driving, and biking habits play a greater role in traffic accidents than the number of car lanes or crosswalks on a given street.

As a pedestrian, I’ve walked across a street with my eyes glued to my phone. Luckily, I haven’t been hit by a car. But if I had, it would’ve been due to my inability to separate my attention from my mobile device. The same goes for distracted drivers. I’ve watched drivers on the Sellwood Bridge pull out their phones when traffic slowed. Our failure to pay attention to the road and take safety precautions, especially at night, is putting ourselves and others at risk.

Portland’s approach of downsizing roads is punitive and counterproductive. Instead, everyone on the road system should take responsibility for their own behavior, regardless of what mode of travel is being used.

Rachel Dawson is a Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

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The MAX Yellow Line: A Look Back After 15 Years

By Rachel Dawson

TriMet’s MAX Yellow Line first opened 15 years ago in May 2004. The Yellow Line’s Final Environmental Impact Statement (FEIS) made a myriad of predictions for the year 2020, which makes now the perfect time to reflect on what officials promised and what taxpayers and transit riders have since received.

Yellow Line History

The Yellow Line originated in 1988 as a 21-mile project connecting Vancouver, Washington with Downtown Portland and Clackamas Town Center. This plan was scrapped after Clark County voters defeated a proposal to raise $236.5 million in 1995 and Oregon voters turned down a $475 million regional ballot measure in 1998.

Not to be deterred by a lack of voter support, officials developed a shorter alternative in 1999 that would run from the Expo Center to Downtown Portland along Interstate Avenue. This alternative cost $350 million, 74% of which came from the Federal Transit Administration (FTA).

The construction of the new alternative was not put to a public vote. Portland officials instead expanded an urban renewal district to include the Interstate Avenue Corridor. Doing so allowed them to appropriate $30 million in tax increment funds to finance the rail that otherwise would have gone to other tax-collecting jurisdictions, including Multnomah County. The county commissioners opposed expansion of the urban renewal district, but the Portland City Council approved it anyway.

Looking back after fifteen years, we find that key promises made in the FEIS were never kept:

1.  Frequency of Service

What We Were Promised: TriMet promised FTA in their Full-Funding Grant Agreement (FFGA) that peak-hour trains would arrive every ten minutes and off-peak trains every 15 minutes. The promised service according to the FEIS was supposed to reach eight trains during peak hours in 2020.

What We Received: Instead of having 10-15-minute headways between trains, the Yellow Line runs every 15 minutes during peak-periods and every 30 minutes during other parts of the day.

2.  Travel Times

What We Were Promised: TriMet predicted travel times to be 24 minutes from Downtown Portland to the Expo Center and 19 minutes from Downtown Portland to N Lombard.[1] Light rail speeds were projected to reach 15.3 miles per hour (mph), and bus speeds were projected to be 13.2 mph in 2005.[2]

What We Received: Actual travel times are slower than predicted. It takes 35 minutes to take light rail from Downtown Portland to the Expo Center and 28 minutes from Downtown Portland to N Lombard, even though light rail has its own exclusive right of way. Actual travel times are 45.8% greater to the Expo Center and 47.4% greater to N Lombard. Actual light rail speeds in the corridor only hit 14.1 mph in 2005 while bus speeds averaged 16.1 mph—significantly faster than predicted.

3.  High ridership

What We Were Promised: The FEIS forecasted ridership in the corridor to dramatically increase with the building of the Yellow Line. By 2020 the line’s ridership was expected to have 18,100 average weekday riders.

What We Received: At no point since the Yellow Line opened has ridership met projected levels. In April 2019 ridership only reached 13,270, 26.7% less than projected. This number will not meet 2020 projected levels based upon the negative trend observed over the past three years. From March 2016 to March 2019 ridership levels decreased by 3.6%.

Lower than promised ridership isn’t unique to the Yellow Line; every TriMet rail forecast has been wrong, and always wrong on the high side.

Light Rail Is Not Superior to Bus Transit

The Yellow Line was expected to provide superior service compared to the no-build bus alternative. This forecast hasn’t panned out. The Yellow Line replaced Line #5, which if it were still operating, would have seven-minute headways between Vancouver and Downtown Portland. C-Tran express service was forecasted to have three-minute headways.[3]

Light rail does not reach any more people or businesses than Line #5 did. In fact, Line #5 had more stops along Interstate Avenue, meaning some riders now have a longer walking commute to the MAX stations.

TriMet bus service from Vancouver to Downtown Portland continues to be an option even after the Yellow Line’s construction. Line #6 was changed to pick up the link between Jantzen Beach and the Yellow Line’s Delta Park stop that Line #5 had previously serviced. It then continues down MLK Boulevard to the Portland City Center.

In Spring 2019, Line #6 saw 665 average weekday on/offs at Jantzen Beach and only 190 total on/offs at Delta Park. This means that the vast majority of Vancouver commuters on Line #6 opt to stay on the bus to Portland instead of transferring to the Yellow Line.

Given the Yellow Line’s history, we can expect the prospective SW Corridor light rail project to increase traffic, have fewer trains than promised, and have lower ridership than predicted. If ridership levels are 26.7% below forecast 15 years into service, why should the SW Corridor ridership estimate of 43,000 daily boardings be taken seriously? The FTA should not offer TriMet additional light rail funding in the future if TriMet is unable to honor its past promises.

TriMet may argue that service levels are below EIS forecasted levels due to a lack of funds. However, TriMet’s revenue increase in recent years tells otherwise. Between 1998 and 2018, passenger fares increased by 116% and tax revenue increased by 64%. TriMet’s payroll tax has been increasing since 2005 and will continue to go up every year until 2024. There is no issue with revenue; rather, the issue lies with light rail.

Moving forward, Metro and TriMet should focus on creating a more reliable bus network that runs on an already built road system. Doing so will benefit riders and taxpayers alike.

__________________________

[1] Federal Transportation Authority, Interstate MAX Before and After Study, 2005, 2-5.

[2] Id, 2-10.

[3] North Corridor Instate MAX Light Rail Project, Final Environmental Impact Statement Executive Summary, October 1999, S-17.

Rachel Dawson is a Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Better Buses May Be the Transit Solution the SW Corridor Needs

By Rachel Dawson

TriMet may have found a better alternative to the proposed SW Corridor light rail project without realizing it.

TriMet is planning a 15-mile-long transit project on Division Street that will run 60-foot buses from downtown Portland to Gresham. The project is estimated to cost $150 million and will include expanded bus stations that offer protection from the weather and signal priority for buses to cut down on travel times by 20%. Each bus is equipped with three doors and can hold 60% more passengers than the typical TriMet bus.

TriMet discarded the idea of continuing buses along the proposed SW Corridor route in favor of light rail despite decreasing transit ridership and increasing light rail costs. Instead of spending nearly $3 billion on a new light rail line, TriMet could mimic the Division Transit Project and run high capacity buses along the route with upgraded stations for just 5% of light rail’s cost. Running buses on an already built system will save hundreds of residents and employees from being displaced. TriMet can also decrease bus emissions by trading diesel for renewable or compressed natural gas for a cleaner ride.

It’s time for TriMet to stop making excuses for light rail and do what is best for both taxpayers and commuters in Portland.

Rachel Dawson is a Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Portland’s Temporary Gas Tax Should Stay Just That

By Rachel Dawson

Portland’s temporary gas tax should stay just that: temporary.

Portland voters approved the 10 cent per gallon gas tax three years ago to fund a road repair and traffic safety program. Since its implementation, the program has failed to live up to all expectations.

Gasoline-using vehicles pay for 100% of the tax but only receive a little over half the benefits. Only 56% of tax revenues go to street maintenance projects, while 44% is spent on pedestrian and bicycle safety.

The program is also poorly managed. A 2019 audit on the tax found that program oversight has been ineffective, many projects have not been completed on time, revenue goals have not been met, and completed projects have cost $900,000 more than what was told to voters.

City staff admitted that project schedules were not realistic and took longer to begin “because the scopes of individual projects were not yet well-defined.” This lackadaisical approach to project planning would never fly in the private sector, so why is the city getting a pass?

Portland commissioner Chloe Eudaly will send the expiring gas tax back to voters in May 2020. The region needs better roads, not another poorly managed tax. For these reasons, Portlanders should vote “no” on extending the gas tax in 2020.

Rachel Dawson is a Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Congestion Pricing in Portland: Good in Theory, Bad in Practice

By Eric Fruits, Ph.D.

“Good in theory, bad in practice.” Sure, it’s a cliché, but it’s a cliché because so often it’s true. It looks to be especially true regarding congestion pricing in the Pacific Northwest.

The Oregon Department of Transportation is pursuing plans to impose tolls on parts of Interstate 5 and Interstate 205. Portland recently announced the formation of an “equitable mobility” task force, with “congestion pricing” as a key component. Not to be outdone, Metro, the Portland area’s regional government, is launching a study it hopes will lead to region-wide congestion pricing.

One would expect that something as big and complex as congestion pricing would require substantial public input. However, Metro has made clear that, at least for its technical evaluation of scenarios, its process does “not anticipate significant public outreach.” This is likely because a key takeaway from a survey by DHM Research concludes tolling “is not a popular idea and residents are skeptical that it will be effective at reducing congestion.”

Done properly, congestion pricing reduces congestion. It increases traffic flow while reducing travel time and greenhouse gas emissions. Who knows, it many even reduce blood pressure and road rage. It also raises money. And, done properly, the money would be used to improve and increase road capacity, which in turn further reduces congestion. In theory, congestion pricing is a near-perfect solution to congestion.

But, it’s a long and winding road from theory to implementation. By the end of the trip, the plan that’s put in place often looks very different from the near perfection seen in textbooks. Along the way, policymakers see the dollar signs and shift the goals from minimizing congestion to maximizing revenues to feed their never-ending need for spending on policy priorities and pet projects. In the Portland region, there appears to be little appetite for using money raised from tolls to expand or improve the road network.

As plans progress, interest groups shift the focus from willingness to pay to ability to pay. If they get their way, the pricing scheme becomes less about reducing congestion and more about income redistribution. The way things are going, it’s likely the tolling schemes under consideration will look like nothing seen in a textbook, and roadway users will be worse off.

Recent research by ECONorthwest provides an indication of how much worse off Portland-area residents could be. The study, commissioned by Uber, estimates the costs and benefits of a tolling scheme under consideration in Seattle. The scheme would draw a line around the city of Seattle and charge every vehicle entering the cordon. The tolls would vary by time of day, based on projected congestion at those times.

The study estimates the time-saving benefits of reduced congestion against the costs of the tolls. It concludes that Seattle-area drivers would be almost $40 million a year worse off under the scheme they studied. In other words, the amount paid in tolls would be about $40 million more than the value of time saved from reduced congestion, not including rebates or benefits that could be funded by toll revenue.

While Portland-area policymakers give lip service to reducing congestion, the transportation policies they’ve put in place can only be described as congestion by design. “Road diets” such as lane reductions have choked off major arterials and sent drivers scurrying through side streets. Reduced speed limits have slowed traffic to a crawl in many areas. Speed bumps seem to be popping up faster than dandelions in spring.

Politics has a way of turning good ideas into bad policies. It’s very likely Portland-area politics will turn the good theory of congestion pricing into the bad practice of punishing drivers.

Eric Fruits, Ph.D. is Vice President of Research at Cascade Policy Institute, Oregon’s free market public policy research organization. This article appeared in The Oregonian on August 14, 2019.

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Think TriMet’s New Electric Buses Run on Wind Power? Think Again.

By Rachel Dawson

TriMet unveiled five new battery-electric buses (BEBs) in April 2019, the sides of which all donned images of windmills and sweeping gusts of wind. The BEBs each cost around $1 million, nearly twice as much as a traditional diesel bus. And these buses are just the beginning: The TriMet board voted last year to replace the entire fleet with battery-electric buses for $1.18 billion by 2040, a $500 million premium over a diesel fleet.

TriMet has been hailed an environmental hero for “riding the winds of change.” TriMet Spokesperson Roberta Altstadt claimed that TriMet was the first in the United States to “operate an electric bus on 100% renewable energy.” Without further research, it would be easy to think that TriMet’s new buses ran on clean wind energy. And that is exactly what TriMet is hoping you would think. But you would be wrong.

If the buses don’t run on 100% wind power, how is TriMet able to get away with saying they do?

TriMet spends $228.75 per month on what are known as renewable energy certificates (RECs) from PGE. RECs are a tradable commodity sold by renewable energy facilities (such as wind farms) to the wholesale market, that purport to represent the “environmental amenities” of certain renewable energy projects. By purchasing the RECs, TriMet has bought the legal right to claim it is using renewable energy; however, the agency has not purchased any energy itself.

This would be like my paying someone else to exercise at the gym for me, and then telling my family and friends I go to the gym. The person I pay reaps both financial and physical benefits while I merely get to pretend I have them.

Supporters of RECs claim the certificates offset fossil fuels and pay for the generation of new renewable energy. However, these claims are not entirely accurate. According to Daniel Press, a Professor of Environmental Studies at UC Santa Cruz, “RECs do little to reduce emissions in the real world because they have become too cheap to shift energy markets or incentivize businesses to build new turbines.” The income generated from RECs does not come close to the millions needed to construct more wind turbines, which means that RECs themselves don’t offset fossil fuels.

Despite its claims, it would be impossible for TriMet to run on 100% wind power unless it disconnected from the regional mixed grid and hooked up to its own personal wind farm. Even then, TriMet would be forced to rely on other backup power sources due to the volatility of wind generation.

While a wind turbine may be available to produce energy around 90% of the time, the average wind farm in the United States in 2018 had a capacity factor of only 37.4%. The capacity factor refers to the amount of energy produced in a year as a fraction of the farm’s maximum capacity. Wind farms produce electricity when winds reach about nine miles per hour and stop at roughly 55 mph to prevent equipment damage. If the wind isn’t blowing (or isn’t blowing strongly enough), little to no power can be generated.

This poses problems, as the electrical grid requires constant equilibrium or blackouts will result—power supply must meet energy demand. Every megawatt of wind power has to be backed up by an equal amount of traditional, “non-green” sources like coal and natural gas to account for times when wind energy isn’t generated. This would be like keeping a car constantly running at home in case the one you’re driving on the road fails.

Instead of a wind farm, TriMet receives its electricity from Portland General Electric, the same mixed grid your home is likely powered by. In 2020, this mixed grid will be made up of 37% natural gas, 28% coal, 18% hydro, 15% renewables, and 2% purchased power (power purchased on the wholesale market). Since wind only makes up a portion of renewables used by PGE, less than 15% of the electricity used by the “wind” buses is powered by wind. A greater percentage of the electricity used by TriMet’s BEBs comes from coal plants than wind farms.

If TriMet were honest with its riders, it would replace the windmills on the sides of the new buses with coal, natural gas, and hydroelectric power plants. In the name of accuracy, TriMet could place a windmill in the corner, demonstrating the small percentage of power generated by wind farms.

So instead of riding the “winds of change,” keep in mind that you’re just riding a really expensive bus.

Rachel Dawson is a Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

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WES at 10: Time to Admit Failure

By John A. Charles, Jr.

TriMet recently marked the ten-year anniversary of the Westside Express Service (WES), the 14.7-mile commuter rail line that runs from Wilsonville to Beaverton. Sadly, there was little to celebrate. WES ridership has been falling steadily since 2014, and there is no prospect that the line will ever meet the opening year forecast of 2,500 average daily boardings.

At the groundbreaking for WES in March 2007, then-Sen. Rod Monroe (D-Portland) gushed, “Wilsonville is jobs rich…the train will be full both ways…morning and afternoon. That is absolutely unique.”

It might have been unique if it had happened, but it had no connection to reality. Average daily ridership peaked in 2014 at 1,964 daily boardings, then dropped in each successive year. During Fiscal Year 2019, WES daily ridership has averaged only 1,505.

A central problem is that WES never had a clear mission; it was always a project in search of a purpose. At various times the train was promoted as: (1) a congestion relief tool for HWY 217; or (2) a catalyst for so-called “Transit-Oriented Development.” Neither of these arguments made sense.

During legislative hearings in Salem, representatives from Washington County claimed that WES would take 5,000 motor vehicles per day off nearby highways. But WES is not even capable of doing that because it only runs eight times (each direction) in the morning, and eight more times in the afternoon. And unlike traditional commuter trains pulling eight or nine passenger cars, WES travels only in one-car or two-car configurations. The train stations themselves are so short that even if TriMet started running eight-car trains, most passengers would have no way to get on or off.

Moreover, WES crosses more than 18 east-west suburban arterials four times each hour. On busy commuter routes, such as HWY 10, each train crossing delays dozens of vehicles for 40 seconds or more. Since the train itself typically only carries 50-60 passengers per run, this means that WES has made Washington County congestion worse than it was before the train opened.

WES has not been a catalyst for “transit-oriented development” and never will be. Train stations are noisy, and zoning restrictions would limit residential parking—even though new residents would need automobiles because it would be almost impossible to travel entirely by commuter rail.

WES was originally projected to cost $65 million and open in 2000. It actually cost $161.2 million and opened in 2009. The WES operating cost per ride in May 2019 was $18.21, roughly 4.5 times the cost of average TriMet bus service.

In June 2016, TriMet staff persuaded the Board to approve the purchase of two used rail cars to expand the WES fleet. The estimated cost for the purchase was $1.5 million, plus $500,000 more for retrofitting. At the time, TriMet claimed that this purchase was necessary to satisfy the “expected demands for growing WES service.” That demand was a fantasy.

When passenger rail forecasts fail to materialize, government planners tend to complain that “we just need more time.” After ten years, the clock has run out on WES. There are no more plausible excuses; it is simply a planning failure.

Taxpayers would be better served if we canceled WES, sold off the train cars, and moved the few commuter rail customers back to buses.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization. A version of this article appeared in The Portland Tribune on July 18, 2019.

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You and Your Car: Portland Public Enemy No. 1

By Micah Perry

Driving around Portland could get a lot more expensive. The Portland City Council just passed a resolution to create an “equitable mobility task force” to study how imposing steep new fees on city drivers could reduce congestion.

Proponents say the fees will help Portland meet its carbon reduction goals. They also claim that, by increasing the cost of driving and parking, low-income residents and people of color will be better off. Ironically, the city itself noted that “65% of peak car commuters in Portland are medium or low income,” meaning any new fees will actually hurt the communities they seek to help.

Fees being considered include increased parking prices, Uber or Lyft surcharges, a mileage tax, and tolls to enter certain areas of the city. This shouldn’t come as a surprise to most, as Portland frequently pursues anti-car policies, such as a citywide gasoline tax, a reduction in street parking downtown, and the city’s notorious “road diets,” which essentially create congestion by design.

If Portland truly cared about easing congestion amid a growing population, it would add lanes wherever possible. And, rather than try to tax people out of their cars, the city should reevaluate its approach to transit and create a public transportation system that can be attractive to commuters without having to resort to coercion.

Micah Perry is a Research Associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Congestion by Design on the New Sellwood Bridge

By John A. Charles, Jr.

Portland-area motorists who have to regularly cross the Sellwood Bridge may wonder why the new structure is twice as wide as the 1925 bridge, yet has the same number of travel lanes. The answer is simple. Portland transportation planners don’t want to solve traffic congestion problems; they prefer to make them worse.

We know this because 20 years ago, Metro published a report entitled the “South Willamette River Crossing Study” (SWRCS), which examined the long-term bridge needs in the stretch of the Willamette River from the Marquam Bridge down to Oregon City. The study found that by 2015, levels of traffic congestion on those bridges would be at “unacceptable or grossly unacceptable levels” if new capacity wasn’t provided.

The study also looked at numerous potential sites for a new bridge but ultimately recommended that no new crossings be constructed. The Metro Council decided instead to focus on “transportation demand management” (TDM) to address the growing congestion.  TDM is an amorphous concept utilizing public relations campaigns and regulatory mandates to encourage drivers to shift to other modes of travel.

Once the decision by Metro was made to place a freeze on new bridge capacity, it was easy for the City of Portland to implement a new policy downsizing Tacoma Street in Sellwood from a four-lane arterial to a two-lane “Main Street,” with lower speed limits. That made it politically impossible for Multnomah County, owner of the Sellwood Bridge, to replace the aging structure with a four-lane bridge.

The decision to build a new bridge was made in 2006, and construction began in 2012. The design featured two 12-foot-wide travel lanes for motor vehicles, two 12-foot-wide sidewalks, and two bike lanes. All the proponents claimed that dedicating more through-capacity for cyclists and pedestrians than vehicles would create a world-class, multi-modal showpiece that would finally tame the automobile and shift drivers to other modes.

In fact, when a USDOT official spoke at the groundbreaking ceremony while presenting an oversized check for $17 million, she told the audience, “We looked all over the country for the best projects, and I have to say, the application for the Sellwood Bridge project knocked it out of the park!”

Unfortunately, all of the hype turned out to be wrong. Extensive monitoring by Cascade Policy Institute over the past three years shows that on a typical day, motor vehicles account for 95% of all passenger-trips. Transit gets about 2%, and walking/cycling combined garner the final 3%. Traffic congestion is growing worse by the month because regional population is growing and the bridge infrastructure has not kept pace.

With a price tag of $328 million, the new bridge is 43 times more expensive than the original; but it’s not 43 times more useful. In fact, it’s less useful, because trucks are not allowed and TriMet never restored the promised transit service.

Metro’s no-growth policy was a predictable failure. It’s time for the Metro Council to admit the mistake, and begin a new planning process with the goal of building at least one new bridge for motorists in the South Willamette River Corridor.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research institute. A version of this article appeared in The Portland Tribune on July 11, 2019.

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SW Corridor Project: A Net Negative for the Environment

By John A. Charles, Jr.

Portland politicians claim to be concerned about carbon dioxide emissions and climate change. That’s why so many of them support TriMet’s proposed 12-mile light rail line from Portland to Bridgeport Village near Tigard. They think it will reduce fossil fuel use.

Their assumptions are wrong.

According to the Environmental Impact Statement (EIS) for the project, energy used during construction of the rail project will equal 5.9 trillion Btu. Much of this will be in the form of fossil fuels needed to power the heavy equipment. Additional energy will be used to manufacture the rail cars, tracks, and overhead wires.

The EIS claims that the negative environmental consequences of construction will be made up by energy saved from operations of the train. However, the operational savings are so small it would take 61 years to mitigate the carbon dioxide emissions of construction.

2035 Daily Vehicle Miles Traveled and Energy Consumption 

Vehicle Type Daily VMT – No build option Million Btu/Day – No build option Daily VMT

With Light Rail

Million Btu/Day

With Light Rail

Passenger vehicle 51,474,286 249,084 51,415,071 248,798
Heavy-duty trucks 3,389,982 73,132 3,389,288 73,117
Transit bus 100,122 3,546 97,501 3,453
Light rail 19,189 1,247 21,200 1,377
TOTAL 54,983,579 327,009 54,923,060 326,745

                                          Source: Draft EIS, SW Corridor Project

Unfortunately, all of the light rail cars will need to be replaced before then. Building new cars will require more energy, resulting in additional CO2 emissions and a longer payback period.

Light rail is not a solution to a perceived climate change problem; it IS a climate change problem. Any further planning for the SW Corridor project should be terminated.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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The New Sellwood Bridge: Promises Unfulfilled

By John A. Charles. Jr.

Executive Summary

Portland has an international reputation for successfully integrating land-use and transportation planning. The primary goals of such planning are to limit the physical size of the city and reduce the daily use of private motor vehicles by encouraging alternative modes of travel.

Many transportation policies have been developed in support of these goals. One of the most visible has been the policy of slowing vehicle speeds through “traffic calming” and “road diets.” Advocates claim that reducing road capacity for motor vehicles has only minor effects on travel time. They also assert that future demand for road space can be mitigated through mode-shifting from single-occupant driving to walking, biking and transit.

In the late 1990s the Sellwood Bridge and its eastside connector, Tacoma Street, provided a perfect opportunity to test both the concept of integrated planning as well as the strategy of implementing a road diet. The original Sellwood Bridge opened in 1925, and over the next 60 years it became the most heavily traveled two-lane bridge in the state. By the mid-1980s the Bridge was badly in need of either major remediation or replacement.

Multnomah County, which owned and operated it, imposed vehicle weight limits in 1985 and again in 2004. After the second reduction, all heavy vehicles (including transit buses) were prohibited.

With traffic levels continuing to rise, it was clear that Multnomah County needed to either build a wider replacement bridge or a two-lane replacement plus another bridge nearby to the south. Local planners, however, believed the Portland region to be overly reliant on the private automobile and decided to place a moratorium on any new Willamette River bridge capacity. They assumed that if the region simply stopped building bridges, they could persuade people to switch from driving to some other mode.

Soon thereafter, the City of Portland undertook a study of Tacoma Street in the Sellwood-Moreland neighborhood, with the goal of making it more pedestrian-friendly. The result of that process was a recommendation to downsize Tacoma from a four-lane collector to a two-lane “Main Street,” even though Tacoma was already a two-lane road except for four hours each weekday – 7-9 a.m. and 4-6 p.m. – when street parking was disallowed so that traffic flowing to and from the bridge could move faster. Striped crosswalks were also recommended in three locations between SE 6th and 13th, to allow pedestrians to safely cross mid-block.

Tacoma Street was put on a “road diet” in 2002, in which two travel lanes in each direction became one travel lane each way along with a center turn lane.  These changes meant the Sellwood Bridge replacement would also inevitably be limited to two traffic lanes. While the new bridge was designed to be more than twice as wide as the original, more than half the through-lane capacity was allocated to non-motorized uses. The County made this decision even though 98% of all peak-hour passenger-trips on the old bridge had taken place in motorized vehicles.

The new Sellwood Bridge opened for travel in February 2016. The north side cycling/walking facilities were open, but the south side bikeway and shared-use sidewalk did not open until 2017.

Now that the bridge has been fully operational for more than two years, it’s possible to measure actual travel patterns and compare them with the forecasted results. It turns out that the transportation planners were wrong in their prediction of how future travel needs would be met.

Traffic congestion is worse than before. Cycling and walking levels have not gone up as predicted, and transit service is far below the levels promised in the planning documents. Moreover, peak-hour vehicle throughput on the bridge has been permanently reduced due to new traffic signals at either end of the bridge and lowered speed limits.

Since bridge “supply” was reduced but motorized travel “demand” went up with population growth, motorists have increasingly resorted to cutting through side streets north and south of Tacoma in order to gain access to the bridge. In fact, the Tacoma Street downsizing made this practice easier by creating a middle turn lane that creates shelter for motorists trying to enter the traffic queue from side streets. This has degraded the quality of life for nearby residents.

Although the new Sellwood Bridge was marketed as a cutting-edge example of the Portland commitment to “multi-modalism,” the bridge itself is not even a multi-modal facility. Heavy trucks are prohibited, and there is no bus service most of the time. Average daily travel is actually more reliant on the private automobile than it was in 1993.

This paper examines the rationale for putting the Sellwood Bridge/Tacoma Street corridor on a road diet and compares actual travel data with pre-construction forecasts. It offers a cautionary note for city leaders who are planning for growth by shrinking important arterials such as Naito Parkway, Foster Road, and NE Broadway.

READ THE FULL REPORT

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, a position he has held since 2004. He received a BA degree with honors from University of Pittsburgh and an MPA degree from Portland State University. He has been writing about transportation policy for more than 30 years. The focus of his research is utilizing field studies to determine how the built environment influences urban travel behavior. He has co-authored case studies of transit-oriented developments in the Portland region related to the South Waterfront district, Hillsboro’s Orenco Station, and Steele Park in Washington County. His most recent paper is entitled, Why Cities and Counties Should Consider Leaving TriMet.

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Press Release: Multi-year case study of Multnomah County’s Sellwood Bridge explains the history behind worsening traffic congestion in the SE Portland bridge corridor

June 6, 2019

FOR IMMEDIATE RELEASE

Media Contact:
John A. Charles, Jr.
503-242-0900
john@cascadepolicy.org

PORTLAND, OR – Today Cascade Policy Institute released the results of a seven-year case study of the Sellwood Bridge reconstruction, The New Sellwood Bridge: Promises Unfulfilled.

The evidence shows that even though the new Sellwood Bridge is more than twice as wide as the original bridge, it moves fewer people at peak hours. Moreover, use of the bridge by cyclists and pedestrians has not increased significantly, despite the generous facilities provided for them.

As a result, traffic congestion in the bridge corridor is worse than it was in 2012, and cut-through traffic in the Sellwood neighborhood has seriously degraded the quality of life for those living and working there.

The increase in traffic congestion was actually planned for by Metro more than 20 years ago, when the regional agency placed a moratorium on any new Willamette River bridge capacity for motor vehicles between the Marquam Bridge and Oregon City. Metro believed that if a bridge cap was imposed, significant numbers of people could be diverted from auto travel to biking, walking, or transit.

Their assumptions were wrong. During two years of intensive field monitoring by Cascade Policy Institute, the combined travel share for biking and walking never exceeded three percent, as shown below:

Sellwood Bridge Travel Patterns, 2017-18

Based on hourly sampling

Year Total observed passenger-trips Auto share Transit share Bike share Pedestrian share
2017 13,593 95.1% 2.2% 2.2% 0.5%
2018 19,888 95.2% 1.9% 2.4% 0.6%

 

Although the new Sellwood Bridge was marketed as a cutting-edge example of the Portland commitment to “multi-modalism,” the bridge itself is not even a multi-modal facility. Heavy trucks are prohibited, and there is no bus service most of the time. Average daily travel is actually more reliant on the private automobile than it was in 1993.

According to Cascade Policy Institute President John A. Charles, Jr., who directed the study,

“Portland-area planners have long believed they could change travel behavior by starving the road system while promoting alternative modes such as transit, walking, and biking. The evidence from the Sellwood Bridge reconstruction shows that wider sidewalks are not a substitute for increased road capacity.”

John Charles is President and CEO of Cascade Policy Institute and has written about transportation policy for more than 30 years. The focus of his research is utilizing field studies to determine how the built environment influences urban travel behavior. Charles received a BA degree with honors from University of Pittsburgh and an MPA degree from Portland State University.

The full report, The New Sellwood Bridge: Promises Unfulfilled, can be downloaded here.

Founded in 1991, Cascade Policy Institute is Oregon’s free-market public policy research center. Cascade’s mission is to explore and promote public policy alternatives that foster individual liberty, personal responsibility, and economic opportunity. For more information, visit cascadepolicy.org.

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Wind Energy is Just Hot Air

By Miranda Bonifield

TriMet recently announced its first “zero-emission” bus is ready to roll, claiming that wind-powered buses are cleaner and easier to maintain. But the reality is that electric buses are dirtier and more expensive than traditional buses.

Wind and solar energy are both known as “intermittent resources” because both kinds of energy farming have long time periods when they don’t generate any power. Unfortunately, energy can’t just be stored like other commodities—as soon as it enters the power grid, it has to travel directly to the end user. There must be a constant supply to meet demand, or customers will not receive power reliably.

During unproductive periods (for instance, when wind turbines aren’t turning) renewable energy farms are forced to rely upon ordinary fuel. But because these periods are unpredictable, the backup has to be running even when power is being generated. Research has indicated as much as a 1% increase in traditional fuel use for every .88% increase in the long-run share of renewable energy. In other words, this supposedly clean energy uses more fuel than it replaces.

It would be far more reasonable for TriMet to focus its energy on improving existing services rather than purchasing buses which are more than twice as expensive and may break down six times as frequently. The claim that wind-powered buses are more efficient for Oregonians is just a bunch of hot air.

Miranda Bonifield is a Research Associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Road Widening, Congestion Pricing Can Improve Metro-Area Drive Times

By Eric Fruits, Ph.D.

I’ve got a big family, which means we do a lot of laundry. With our old appliances, we were doing a load a day and there was a backlog of dirty clothes.

When our old washer and dryer went kaput, we decided on an upgrade. I bought the biggest, most energy efficient washer and dryer I could afford. I figured with bigger loads, we’d be doing fewer loads. But in some ways, I was wrong. Sure, the new washer and dryer could hold a lot more laundry, but we were still doing about a load a day.

However, something changed: The backlog of dirty clothes disappeared, and our utility bills decreased. Even though we are still washing clothes every day, we are washing more clothes more cheaply than we were before. Where it used to take three hours for a complete wash-and-dry cycle, now it’s closer to two hours. Those new appliances made our day-to-day lives measurably better off.

In Portland, the Oregon Department of Transportation is in the process of widening I-5 through the Rose Quarter, which has been named one of the worst bottlenecks in the country by the American Transportation Research Institute. ODOT forecasts the improvements will save more than 2.5 million hours of travel time each year and reduce crashes by up to 50 percent. For example, the current “worst” stretch (I-5 southbound, from the Going on-ramp to I-84 eastbound off-ramp), will see travel times drop 15-30 percent. Over a typical work year, that would save a commuter more than 20 hours of time stuck in his or her vehicle. Many, if not most, commuters through the Rose Quarter will be measurably better off because of this project.

Despite these anticipated benefits for commuters, opponents of the I-5 project claim that increasing highway capacity will increase congestion. They invoke a concept they call “induced demand,” arguing that wider roads “induce” people to drive more, leading to more traffic and ultimately even worse congestion than before the improvements were made. It’s much like arguing that I’m worse off because my new washer and dryer can handle more laundry than my old klunkers.

Critics of the project tend to confound traffic with congestion. Traffic is the number of vehicles or vehicle miles travelled. Congestion involves speeds or travel time. A road can have a lot of traffic and little congestion. Similarly, a road with relatively little traffic can be highly congested—such as streets around a neighborhood school in a residential area during drop-off and pick-up times.

To be sure, improvements around the Rose Quarter will increase traffic on I-5 and I-84. Some of that traffic will come from more people driving. But some of that traffic will be the result of people choosing to use the highways instead of taking arterials or residential streets, which will reduce congestion on these increasingly clogged roads. If it’s cheaper in terms of time to take a highway rather than an arterial, people will choose the highway. That’s not “induced” demand, that’s plain old vanilla demand. Lower prices lead to higher quantity demanded.

The Rose Quarter highway improvements are to be combined with a congestion pricing program that will further improve traffic speeds and travel times. Done properly, such pricing discourages driving when congestion is most likely. Anyone who has used Uber or Lyft has experienced congestion pricing with the services’ “surge pricing,” in which fares increase when demand for rides exceeds the number of drivers at a particular time. Congestion pricing smooths the timing of trips to foster a faster flow of vehicles.

The benefits of road widening are readily visible here in Portland. Last year, a newly completed auxiliary lane on I-5 southbound from OR 217 to I-205 removed a frustrating bottleneck. According to ODOT, that stretch of road went from five hours of afternoon rush-hour congestion to one hour a day of congestion, during the afternoon commute. OR 217 went from four hours of congestion to zero hours of congestion. I’m sure no one is sitting in their car on I-5 or OR 217 saying, “I really miss all that congestion.”

The Portland region is adding more than 30,000 people each year. Our transportation system needs to keep up with the influx of new residents, workers, and business activity. It’s this growth that’s inducing the demand for more and better roads, and the region needs to meet that demand.

Eric Fruits, Ph.D. is Vice President of Research at Cascade Policy Institute, Oregon’s free market public policy research organization. A version of this article appeared in The Portland Tribune on April 25, 2019.

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Metro’s Priorities Don’t Match Yours

By John A. Charles, Jr.

The Portland regional government known as Metro recently published the results of a poll regarding the most important issues to the region. Unsurprisingly, traffic congestion emerged as the number one concern: 96% of all respondents stated that congestion was a serious problem.

These results are consistent with virtually every poll taken over the past 25 years, yet congestion continues to get worse. The reason is that the Metro Council refuses to improve driving conditions and authorize new bridges and highways where they are needed, such as the west side of Portland.

Instead, Metro is determined to spend enormous sums of public money on additional light rail service that most people will never use.

Metro has appointed a 30-person Task Force to draft a ballot measure for 2020 seeking billions of dollars to build a light rail line to Bridgeport Village. This would be a complete waste of money. Transit ridership peaked in 2012. Since then, thousands of customers have left for Uber and Lyft, and they’re not coming back. TriMet is becoming irrelevant.

Sadly, no one at Metro or TriMet cares what taxpayers want—they only care about expanding their bureaucratic empires. Voters should remember this when the bond measure is unveiled later this year.

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John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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How Ride Hailing Services Can Complement Bus and Rail—and Save TriMet Money

By Eric Fruits, Ph.D.

After teaching an evening class at Portland State University, I walked up to the kiosk showing TriMet arrival times. My bus was coming in five minutes. Good news. One of my students was standing there, too. She shook her head, looked at her phone, and said, “My next bus is in 30 minutes. I’m just going to Uber home.” Her situation wasn’t unique. Across the country, more and more commuters see ride hailing as a reliable and affordable substitute for mass transit.

Transit agencies should see services such as Lyft and Uber as an opportunity rather than a threat. Toward that end, Cascade Policy Institute recommends TriMet pursue a pilot project that replaces one or more of its high-cost bus lines with ride hailing services supported by a subsidy funded with the cost savings from eliminating the high-cost line. The experiment likely will find that replacing high-cost bus service with ride hailing will improve ridership and save money.

TriMet faces a challenge of declining ridership in conjunction with rising costs. Ridership has declined for many public transit providers in the U.S.—TriMet reports bus boardings have dropped 13 percent from their 2009 peak. As the Portland Tribune reported, the agency thinks many factors have contributed to the decline in ridership, including gentrification in Portland, the growth of urban centers inside and outside the city, and the development of self-sufficient walkable neighborhoods that has reduced the need for bus trips.

Longer travel times likely are another factor that explains the decline in bus ridership. From 2007 through 2017, the average vehicle speed for TriMet buses has dropped by almost nine percent. Portland city commissioner Amanda Fritz recently tweeted that Portland’s new speed limit law has made her bus commute five minutes longer. Over a year, that’s about 30 extra hours sitting on a bus. With longer travel times, the costs to commuters of using public transit increase, leading to a decline in ridership.

As with any mass transit enterprise, TriMet operates a number of high-cost, low-ridership bus lines. For example, the agency reports the 97 (Tualatin-Sherwood Rd) bus line has about ten riders per hour at a cost of more than $18 per ride. The fare for a ride hailing service covering the same distance as the average bus trip would be less than $8. Service on this route could be completely replaced by ride hailing services and save TriMet thousands of dollars a week.

While ride hailing can replace mass transit, it can also complement bus and rail service. Recent research finds that ride hailing services have the largest positive effect on rail service in cities with large public transit systems already in place, such as Portland. In 2015, Lyft conducted a nationwide survey of riders and found that 25 percent of riders use Lyft to connect to public transit. Uber reports that nearly 25 percent of Uber trips in suburban Portland began or ended within one quarter-mile of a MAX or WES station.

More than a dozen cities in the United States currently have programs running similar to the pilot project we propose. Detroit’s program, “Woodward 2 Work,” runs late at night and is aimed at those who work late shifts when mass transit does not run. San Clemente replaced two high-cost bus lines with ride hailing. Marin County’s service is designed to boost ridership on commuter rail by making it more convenient for riders to get to and from rail stations. Several of the programs that began as pilots have been extended because of their success in serving commuters and saving money.

Many of these cities have developed procedures to accommodate users who do not have a smartphone and users with ADA-related needs. In approving ride hailing services in Portland, the city mandated a performance standard that called for wheelchair accessible vehicles to reach riders in thirty minutes or less. In Detroit’s program, riders without bank accounts can use prepaid gift cards.

The pilot project we recommend would be a low-cost, low-risk test of potential synergies between public transit and private ride hailing. If successful, the lessons learned can and should be applied to additional high-cost transit lines.

Eric Fruits, Ph.D. is an Oregon-based economist, adjunct professor at Portland State University, and Academic Advisor at Cascade Policy Institute, Oregon’s free market public policy research organization. A version of this article appeared in The Portland Tribune on January 24, 2019.

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Ride-Hailing Could Give an Uber-Needed Lyft to TriMet Service

By Miranda Bonifield

TriMet’s ridership has been steadily declining in recent years, to the great concern of transit advocates and fiscally conscious citizens alike. Proposed solutions involve sending expensive new bus and rail lines to underserved locations. But what if TriMet could reach new customers at a fraction of that cost?

Cascade Policy Institute recently released a study by economist Dr. Eric Fruits which found one or more high-cost and low-ridership bus lines could be replaced by facilitating the use of ride-hailing services in partnership with transit. Riders within particular areas could call an Uber or Lyft, ride to the bus, and then take public transit the rest of the way—a much more efficient and comfortable method than walking or biking through the rain. It could cost 55% less than expensive proposed bus lines—saving TriMet money—and slightly less than current bus and Max fares—saving customers money.

This isn’t a new idea; transit companies across the country have taken advantage of ride-hailing services’ ability to complement public transit. Studies have found a small but significant increase in transit ridership in cities with large transit systems which chose to partner with ride-hailing services. TriMet should pursue this low-risk, high-benefit option with a one-year pilot project beneficial to taxpayers, riders, and TriMet alike.

Miranda Bonifield is Research Associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

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ODOT’s Passenger Rail Project Equals Increasing Costs, High Taxpayer Subsidies

By Justus Armstrong

The Oregon Department of Transportation recently published its Tier 1 Draft Environmental Impact Statement (EIS) for the Oregon Passenger Rail Project, which plans to expand and improve passenger rail service between Eugene and Portland and increase Amtrak Cascades rail service from two to six round trips per day. Out of two potential build alternatives—Alternative 1, which would improve the existing Amtrak route, and Alternative 2, which would create a new route along Interstate 5 between Springfield and Oregon City—ODOT has identified Alternative 1 as the preferred alternative. Many are optimistic about improved passenger rail options, but Alternative 1 would include anywhere from $870 to $1,025 million in capital costs. Is the project worth such a high price?

One of the stated goals of the Passenger Rail plan is to implement a cost-effective project, but based on ODOT’s own testimony, it appears that Amtrak is actually becoming less cost-effective. In a 2017 Legislative report on passenger rail performance, ODOT reported that “[t]he gap between revenue and costs continues to increase.…It is likely the costs to operate the service will increase in the coming years.”

The EIS estimates that Alternative 1 would cost around $48 million a year in operations and maintenance costs—a sharp increase from the $17.75 million ODOT currently pays Amtrak annually to support the existing rail service. The EIS also admits that this is a conservative estimation based on the assumption that Amtrak payments will triple as the number of round trips triples. Currently, ODOT subsidizes each one-way Amtrak ride to the tune of about $118, and with the costs to operate Amtrak already rising, expanding an increasingly cost-ineffective service risks adding to an even greater burden on Oregon taxpayers.

On the other hand, if the improved passenger rail service were to achieve the 89 percent increase in ridership hoped for by 2035, ODOT’s subsidy would be distributed more broadly among an expected 646,000 annual rail passengers. Theoretically, this could help make ODOT’s investment more worthwhile.

More Amtrak passengers would mean more ticket revenue, lessening the gap between revenue and operating costs. However, ODOT’s ridership projections are largely based on the hope that population increases in the Willamette Valley “could result in unprecedented ridership increases.” In perspective, only 105,000 (less than 4%) of the Willamette Valley’s 2.8 million residents were riding Amtrak in 2015. Living up to the ridership goals in the EIS would require a significant shift in transportation choice towards intercity passenger rail not yet seen in Oregon.

The draft EIS does not include projections for expected revenues and fare recovery, so exact measures of cost effectiveness for the project are not yet nailed down. Unless fare recovery is significantly improved, Oregon will continue to lead the nation in passenger rail subsidies and triple already wasteful operating expenditures.

There is also the matter of the $1 billion in construction and design costs that would have to come from state and federal funds. ODOT’s passenger rail plans are likely motivated by prospects of broader eligibility for federal funding, but any advancements in rail service are bound to be a costly investment for Oregonians.

Public transportation expansions are often put forward as solutions to highway congestion. However, the EIS for the passenger rail project admits that neither build alternative would alleviate Oregon’s congestion issues, stating that the potential reduction in the number of vehicles on I-5 between Eugene and Portland “would not be significant enough to affect or improve congestion on I-5.” In fact, the EIS states that the project could even exacerbate congestion by increasing vehicle activity on surface streets near Amtrak stations. Expanding passenger rail service may benefit the small portion of the Willamette Valley population that uses Amtrak, but would do little to address Oregon’s broader transportation challenges.

Instead of expanding Amtrak rail service, ODOT could plan on gradually increasing the frequency of Thruway bus service over the next 20 years. The No Action alternative already includes plans to increase intercity bus service between Eugene and Portland to seven round trips per day, so why not focus on further increasing bus frequency rather than replacing it with a more costly rail alternative? That way, transportation service can be more flexibly adjusted to transportation demands without the same level of capital investment and heavy subsidies that expanding passenger rail would require.

Justus Armstrong is a Research Associate at Cascade Policy Institute, Oregon’s free-market public policy research organization.

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Press Release: Report shows ride-hailing services would be a viable solution for TriMet’s high-cost bus lines

FOR IMMEDIATE RELEASE

Media Contact:
John A. Charles, Jr.
503-242-0900
john@cascadepolicy.org

PORTLAND, Ore. – Today Cascade Policy Institute released a report that recommends TriMet pursue a one-year pilot program which replaces one or more high-cost and low-ridership bus lines with ride-hailing services. The program would be supported by a subsidy funded by the costs saved by eliminating the bus line.

The report, Ride-Hailing as a Solution for TriMet’s High Cost Bus Lines: A Proposal for a Pilot Project, was authored by Eric Fruits, Ph.D., an Oregon based economist and Portland State University adjunct professor.

The proposed pilot program would offer riders point to point service from ride-hailing companies like Uber and Lyft within a ride-hail zone, when and where within the zone would be most convenient to the rider. The two high-cost bus lines suggested by Fruits include lines 97 (Tualatin-Sherwood Rd) and 63 (Washington Park/Arlington Hts). These lines intersect other bus lines and MAX stops, so the proof of the transaction should be used as a 2.5-hour TriMet pass. Doing so would allow passengers to connect to other buses or light rail in the area.

Cascade President and CEO John A. Charles, Jr. stated, “TriMet should embrace the benefits ride-hailing services offer instead of viewing them as a threat. Pairing services like Uber and Lyft with TriMet’s bus services would give riders a convenient and affordable way to commute while saving TriMet considerable money.” Indeed, the cost of subsidizing 75% of a user’s ride-share fare would be 55% lower than the current cost of operating proposed bus lines 97 and 63.

This proposal comes with its own set of challenges in the form of barriers to access. Services such as Uber and Lyft are hailed through an app on an individual’s smartphone and paid for by linking an individual’s bank account to the app. Some TriMet users do not own either a smartphone or a bank account. Jurisdictions which have adopted similar programs have handled this challenge by creating call centers available to riders without smartphones and by giving unbanked riders prepaid gift cards.

Ride-hailing services also contract out wheelchair accessible rides to third-party companies which would allow disabled riders to continue to commute in the corridor.

Similar pilot projects have been implemented in cities across the United States as transit authorities have recognized and taken advantage of the benefits ride-hailing services offer. TriMet should follow suit and engage in a low-stakes, one-year pilot project in order to cut costs that are rising due to declining ridership in certain areas. Doing so will serve riders, TriMet, and taxpayers alike.

The full report, Ride-Hailing as a Solution for TriMet’s High Cost Bus Lines: A Proposal for a Pilot Project, can be downloaded here.

Founded in 1991, Cascade Policy Institute is Oregon’s free-market public policy research center. Cascade’s mission is to explore and promote public policy alternatives that foster individual liberty, personal responsibility, and economic opportunity. For more information, visit cascadepolicy.org.

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Ride Hailing as a Solution to TriMet’s High-Cost Bus Lines

A Proposal for a Pilot Project

By Eric Fruits, Ph.D.

Summary and recommendation

This report recommends TriMet pursue a one-year pilot project that replaces one or more of its high-cost bus lines with ride hailing services supported by a subsidy funded with the cost savings from eliminating the high-cost bus line.

  • A subsidy covering 75 percent of the fare to eligible riders would be straightforward and relatively easy to understand, implement, and use.
  • TriMet bus lines 97 (Tualatin-Sherwood Rd) and 63 (Washington Park/Arlington Hts) would be reasonable candidates for the pilot project. These lines provide the best combination of lower user costs and cost savings to TriMet.
  • The average rider’s cost would be slightly lower than current TriMet fares. Because the customer is paying a portion of the fare, riders would be more likely to weigh the benefits and costs of using the ride hail service as a connection to the TriMet system (first mile/last mile, a complement to TriMet service) versus door-to-door (a substitute for TriMet service).
  • The cost of the 75 percent subsidy on lines 97 and 63 would be approximately 55 percent lower than the current costs of operating the high-cost bus lines.

Each of the bus lines identified in this report intersects with other bus, MAX, and WES stops or overlaps TriMet transit centers. Uber found that nearly 25 percent of Uber trips in suburban Portland began or ended within one-quarter mile of a MAX or WES station, as shown in Figure 1 and Figure 2 of this report. To encourage use of ride hailing services as a complement to the TriMet system, proof of fare payment should also serve as a 2.5 hour TriMet pass.

More than a dozen cities in the United States have programs similar to the proposed pilot project. Many of these cities have developed procedures to accommodate users who do not have a smartphone and users with ADA-related needs. Several of the programs began as pilot programs that have been extended because of the success of the pilot.

TriMet faces a challenge of declining ridership in conjunction with rising costs. In addition, the agency operates a number of high-cost bus lines. At the same time, ride hailing services, such as Uber and Lyft have grown in popularity since their introduction to the Portland region in 2015, providing convenient, reliable, low-cost service to millions of riders.

Recent research finds that ride hailing services have the largest positive complementary effect on rail service in cities with large public transit systems already in place, such as Portland. For these cities, the researchers found a small, but statistically significant, complementary effect on bus ridership.

The pilot project recommended in this report would be a low-cost, low-risk test of potential synergies between public transit and private ride hailing. If successful, the lessons learned can and should be applied to additional high-cost transit lines.

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Proof by Assertion

By John A. Charles, Jr.

Many Portland drivers probably wonder why there are so many curb pop-outs on Portland streets. The pop-outs, also called bioswales, are usually shaped like rectangles or triangles and filled with plants, grass, and a drain pipe.

While advocates think the bioswales are important to protect water quality, a new report released by the Portland Auditor shows that there is little evidence to support such claims. The problem is the Portland Bureau of Environmental Services doesn’t have a monitoring plan.

In 2018 the Bureau spent $13 million in construction and maintenance costs for watershed protection, but no one was responsible for oversight. In fact, the Bureau did not even have an inventory to document where it spent money for restoration projects and the goals achieved.

This should not be a surprise. Both the Portland City Auditor and the Metro Auditor have issued multiple reports in recent years criticizing their own agencies for spending money without having systems in place to evaluate results. Those audits have generally been ignored by bureaucratic supervisors.

Unfortunately, Auditors can shine light on waste and mismanagement, but they cannot force changes. Only voters can do that by holding public officials accountable.

John A. Charles, Jr. is President and CEO of  Cascade Policy Institute, Oregon’s free market public policy research institute.

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TriMet’s New Electric Buses Will Be Less Reliable, More Costly

By John A. Charles, Jr.

The TriMet board recently voted to replace the agency’s entire bus fleet with battery-electric buses by 2040. Since each electric bus is more than twice as expensive as a standard diesel bus, this decision will cost taxpayers more than $550 million in excess costs.

The electric premium might be worth it if there were significant benefits to switching fuels, but there aren’t. In fact, battery-powered buses are far less reliable than diesel or natural gas buses. According to a recent study by the Federal Transit Administration, battery electric buses in Seattle only traveled 2,771 miles on average between breakdowns; for diesel buses, it was 17,332.

Since moving passengers is TriMet’s primary job, this alone should have disqualified battery buses from consideration.

The primary motivation for TriMet seems to be reducing so-called “greenhouse gases,” but battery-powered buses offer no real air quality benefit. The buses must be charged from the utility grid, which is powered mostly by coal and natural gas. Even large wind farms are backed up every minute of the day by other sources such as gas and hydro dams. Using battery-electric buses simply changes where greenhouse gases are emitted, which is meaningless.

A better alternative would be renewable natural gas, derived from processing food waste or methane emissions from landfills. For this reason the Los Angeles County Metropolitan Transit Authority concluded in 2016 that it would switch its entire fleet to renewable natural gas buses because it would provide “approximately 39% greater reductions in GHG emissions at half the cost” when compared to electric buses.

Finally, TriMet has no way to pay for the electric bus conversion. The staff recommended buying the first 80 electric buses with combinations of federal grants and money from the new statewide employee tax, followed by a hoped-for legislative bailout sometime after 2022. That’s not a plan, it’s a fantasy.

TriMet has already been awarded ten battery electric buses through grants from the federal government. A more prudent option going forward would be to buy ten buses using other fuels—such as compressed natural gas and renewable natural gas—and then test them all head-to-head to measure reliability, emissions, noise, and passenger comfort.

This was a rash decision. The TriMet Board should admit that it made a mistake, and spend the next two years analyzing alternative fuels. If taxpayers are going to be forced to pay an extra half-billion dollars for new buses, there should at least be a good reason.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization. A version of this article appeared in The Portland Tribune on November 13, 2018.

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Metro Should Let Transit Customers Drive Transportation Innovation

By Justus Armstrong

ABC’s Shark Tank may be coming to the Portland region—not in the form of a reality TV special, but as a taxpayer-funded project that positions the Metro regional government to act as a venture capital firm. Rather than investing in the success of growing businesses, however, the Sharks at Metro plan to fund temporary pilot projects that test new transportation technology.

Metro proposes that its Partnerships and Innovative Learning Opportunities in Transportation (PILOT) program—a component of the Emerging Technology Strategy—would help meet its “guided innovation” goals, but the shortsighted approach of this program ignores a vital question: Are risky technological investments the best use of taxpayer funding?

In a presentation at a Metro work session in July, Senior Technology Strategist Eliot Rose suggested the PILOT program would “guide innovation in transportation technology toward creating a more equitable and livable region.” Embedded in the presentation were numerous contradictions, beginning with the oxymoron of “guided innovation.” In Metro’s case, guided innovation more than likely means “hindered innovation,” with PILOT funding being a carrot-and-stick method of ensuring that emerging technologies take the direction technocrats deem appropriate, not the direction consumers are demanding.

By allocating government funding to the transportation projects of its choice, Metro risks preventing better ideas from emerging and hampering the innovation necessary for real progress to take place. As Metro strategist Rose noted, ridesharing, bikesharing, and other technologies PILOT wishes to foster have already been expanding in Portland. This technological progress has taken place with private investment, yet Rose still concludes that public money is needed for it to continue.

During the July work session, Metro staff claimed that the government “needs to intervene to bring technology to people and communities that the market doesn’t serve.” This assumption presents another contradiction: If an investment isn’t cost-effective for a private actor, what makes it a cost-effective investment to Metro? And how can successful projects be expected to continue without public funding, if the projects’ functions wouldn’t otherwise be demanded by the market?

Furthermore, Metro’s plan risks sinking taxpayer money into potentially unsuccessful projects. The $165,000 Forth-Hacienda project was presented by Metro as an example of a successful pilot project—not because the project itself was successful, but because its failure offered a great learning experience. The desire to better understand new technologies is not without merit, but the experimental nature of such pilot projects hardly makes them a good fit for taxpayer funding.

For all the project’s flaws, discussion about Metro’s Emerging Technology Strategy has included some promising aspects. For instance, during the work session, Metro Councilor Shirley Craddick brought up the idea of transitioning some of TriMet’s responsibilities to ridesharing networks. Considering more innovative modes for public transportation would be a step in the right direction and likely would improve cost-effectiveness, quality, and ridership of transit while meeting the needs of the populations Metro seeks to assist.

Perhaps a more effective Emerging Technology Strategy could focus solely on ways to improve existing public transportation through new technology, rather than interfering with private transportation markets through subsidies and attempts to shape private development. Instead of subsidizing companies with PILOT funding, Metro could offer open-ended transportation vouchers directly to transit users, especially transit-dependent and underserved populations.

Transit vouchers could be spent on a variety of transportation options, including TriMet and the newer technologies the PILOT program intends to target, such as rideshare, bikeshare, and electric vehicle and autonomous vehicle rentals. Putting the money directly into the hands of transit users could drive innovation through consumer sovereignty on the demand side, encouraging competition and making companies work to meet transit users’ needs instead of Metro’s project specifications.

With its PILOT program, Metro seeks to encourage innovation while managing risk; but any risk associated with developing new technologies should be borne by the companies driving the innovation, not by the public. If Metro moves forward with the PILOT program, it will only hinder its own goals. Instead of shaping existing markets in the private sector, Metro should focus on applying technological improvements to public transportation options.

Moreover, Metro should reform the regulatory framework and barriers to entry that may be preventing the emerging transportation technology market from functioning at its best. After all, the expansion of Uber and Lyft in Portland didn’t take place because Portland subsidized these companies. It happened because Portland stopped banning them. Metro councilors and staff can’t foresee the direction that new technologies will take, so they can’t know enough in advance to guide the direction of innovation or adequately manage its risks. The best they can do is get out of the way.

Justus Armstrong is a Research Associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Electric Buses: Another Costly Fad

By John A. Charles, Jr.

The TriMet Board recently approved a plan to replace its entire fleet with battery-electric buses (BEBs) by 2040. If implemented, this will cost taxpayers $553 million more than buying diesel buses.

It might be worth the premium if battery powered buses were cleaner or more reliable, but they aren’t. King County, Washington has been testing BEBs since April 2016. On average, they only travel 2,771 miles between service failures. Diesel buses are good for 17,332 miles—more than six times as long.

In addition, battery buses are not the best environmental option, because they draw electricity from power plants using fossil fuels. The Los Angeles County Metropolitan Transit Authority went through an extensive analysis in 2016, and found that “renewable” natural gas derived from landfill methane had a much better environmental profile than electric vehicles.

For that reason, the MTA decided to convert its bus fleet to renewable natural gas, not electric. The agency concluded that renewable natural gas “achieves 39% greater reductions in greenhouse gas emissions, at half the cost” of electric buses.

What does TriMet know that the Los Angeles MTA doesn’t? That question should be answered before we spend $553 million.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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Moving in the Wrong Direction

By Jakob Puckett

Oregonians have a proud tradition of giving back to distinguished or disadvantaged members of society. Businesses have broken barriers to provide better service to groups like seniors, veterans, new families, and vulnerable people, by offering discounted rates or donating services for a worthy cause.

In one particular and familiar industry, however, the state will not allow such generosity. Customers in the aforementioned groups looking to move from one home to another, who could benefit from special offers, would find themselves out of luck, thanks to an apathetic state agency with misaligned priorities.

Not everyone will accept this, though. 2 Brothers Moving and Delivery, a home moving business in Portland, has challenged the status quo of the residential moving industry for years. In addition to moving and rearranging homes, company founder Adam Sweet has been shifting the legal landscape of how to start a home moving company in the first place.

After a much-publicized state police sting operation embroiled Sweet in a legal tangle about whether he, then a college student, could move other people’s furniture without permission from established moving companies, he challenged the law and won. No longer would new moving businesses have to justify their existence to the competition. Now, Sweet wants to change another part of the law, one that’s just as unfair to even more people.

The state of Oregon treats home moving services like a public utility and regulates them similarly to commodities like water and electricity. Home movers painstakingly must organize, request, and publish their tariffs (the rates they charge on every aspect of their service). And they truly do “request” what prices customers will pay for their services. The Oregon Department of Transportation (ODOT) gives permission for their rates, under the guidelines of what is considered “fair and reasonable.”

However, those with the most influence in this oversight process rarely approach this standard from a customer’s perspective. What is “fair and reasonable” to industrial moving companies who rarely make residential moves (the companies with the loudest voices within ODOT) may not be “fair and reasonable” in terms of residential customer benefit.

Pressured by mountains of impending paperwork, small home moving businesses often find it easier to accept the proposed rates of these larger companies, rather than requesting individualized rates. ODOT employees end up determining what is fair and reasonable, on everything from the price of boxes to move your television to whether you pay per hour and miles moved or by the weight of your furniture.

The state tries to tell businesses what the consumer wants, and oftentimes they are simply wrong.

Leaving aside whether household moving services are a natural monopoly—defined as an industry with nearly insurmountable entry barriers that render competition almost impossible—ODOT, under a “fair and reasonable” cloak, prevents customers from having options that would be offered in any other industry.

Discounts are not allowed, meaning seniors, veterans, or any other group for any other reason cannot receive a lower price, even if the business wants to offer it. Donating services as a charity to individuals, such as transitioning homeless individuals or those with cancer, are prohibited. Undercharging a customer based on the published tariff rate results in a series of increasing fines, culminating in the state revoking the company’s ability to do business at all.

If the goal is to ensure that customers are not fleeced by moving companies adding hidden fees, Sweet sees a simple solution: include proposed exceptions in the published tariffs. “If it’s published in the tariff, you should be able to charge it,” he says, and that includes discount options. The Department of Justice already handles cases of business fraud, and law enforcement already has mechanisms for dealing with those situations. Why should ODOT make the process more complicated to the disadvantage of customers? Most Americans move eleven times during their lives, meaning this question usually arises nearly a dozen times.

Ultimately, it turns out that consumers really do need protection, but not from their own shortsightedness or from home moving businesses. Rather, the real risk comes from the anti-consumer mantras echoing through the halls of ODOT, determining how good or bad of a deal individuals and families can get during moving season.

Jakob Puckett is a Research Associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

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When Did ODOT Become a Consumer Advocate?

By Jakob Puckett

Do you need to be protected from your own judgment? If you’re moving from one home to another, the state of Oregon thinks you do. The Oregon Department of Transportation thinks that you are not capable of finding a fair and reasonable price to pay a home moving business to move your furniture, so ODOT injected itself into the equation.

Home moving services have to painstakingly request permission from ODOT to determine what prices to charge, making it difficult for businesses to lower their prices or offer discounts.

Even when businesses want to offer a discount to veterans, senior citizens, or disadvantaged people, they are prohibited from showing such generosity under penalty of fines and business closure.

And why is this? ODOT thinks it knows what’s best for consumers and makes these decisions on its own, without much input from the businesses actually offering the services.

The person who suffers the most from this is you, because as long as ODOT gets to determine what a “fair and reasonable” price is, you are prevented from having options that would be offered in most other industries.

So when it comes to the regulation of the home moving industry, the situation is clear: It’s time for ODOT to leave the price-setting business, and move us in the right direction.

Jakob Puckett is a Research Associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

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High Costs and Low Ridership Are Nothing New for Southwest Corridor Project

By Rachel Dawson

Decreasing ridership paired with increasing costs makes for a bad business decision for TriMet’s proposed Southwest Corridor plan. The TriMet proposal would add an additional light rail line stretching from downtown Portland to Bridgeport Village in Tigard. The project’s draft environmental impact statement predicts what TriMet thinks will happen, without taking into consideration what has occurred with past projects.

The plan estimates that rides on every current light rail line will more than double, and the total weekday rides will nearly triple by the year 2035. However, in recent years light rail rides have been decreasing or plateauing across the board.

But overpredicting ridership isn’t anything new: Every single past TriMet light rail plan overestimated the number of rides it would have.

Additionally, the capital costs of light rail projects historically have been underestimated, meaning projects have proven to be more expensive than what TriMet had predicted. This has already become evident with the Southwest Corridor plan: In 2016 the capital costs were predicted to be $1.8 billion dollars, which increased to $2.8 billion in 2018.

Increasing prices plus decreasing ridership sounds more like a recipe for economic disaster than a successful project. You have the opportunity to voice your opinion at the southwest corridor public hearing on Thursday, July 19 at the Tigard City Hall.

Rachel Dawson is a Research Associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

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New Transportation Tax Is on the Wrong Side of History

By John A. Charles, Jr.

Oregon employers began receiving notices this week regarding the new statewide transit tax that goes into effect on July 1. The law requires all employers to withhold, report, and remit one-tenth of one percent of wages paid to their employees to the Oregon Department of Revenue. The money will go into a Statewide Transportation Improvement Fund to subsidize public transit agencies.

The new tax is being imposed at exactly the wrong time in history. Transit ridership is declining across the country, and it’s not because transit agencies lack money. The problem is that their service models are obsolete.

The ride-hailing revolution brought about by Uber, Lyft, Sidecar, and other start-ups has raised the expectations of customers. People now want on-demand, door-to-door service that they can order through their phones. The coming revolution in driverless cars will only accelerate that change.

The traditional service offered by legacy transit agencies—fixed-route, limited-schedule service on slow buses—just isn’t good enough anymore.

Subsidizing transit with one more tax will simply delay the inevitable. The legislature should repeal this tax as soon as possible.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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TriMet Shows Pension Reform Is Possible

By Scott Shepard and John A. Charles, Jr.

The Oregon legislature recently adjourned its 2018 session and once again took no action to reduce the long-term financial obligations of the Oregon Public Employee Retirement System. Conventional wisdom in Salem is that significant pension reform is impossible, so we should just quietly accept our fate that the PERS crisis will lead to layoffs at public schools and other service providers.

The conventional wisdom is wrong.

The Portland regional transit district, TriMet, is not part of PERS and has been slowly reforming its pension program since 2002. As a result, 100 percent of all new employees are now in 401(k)-style pensions that have no long-term liabilities for employers. These are referred to as “defined-contribution” pensions in which monthly payments are made by management into personal accounts owned by employees. Once those payments are made, the employer has no further financial obligations.

This stands in contrast to “defined-benefit” programs like PERS in which employees are promised various levels of retirement payments calculated through arcane formulas that leave management clueless about the major level of funding obligation they’ve agreed to.

The advantages for taxpayers of moving public employees into defined-contribution pensions is now evident in the actuarial projections done for TriMet. According to the most recent valuation, estimated annual benefit payments for TriMet defined-benefit pensions will peak in 2034 at $74.6 million, then drop to $24 million in 2060 and $6 million by 2072. They will hit zero by the turn of the century.

This was not something that TriMet did casually. Management was forced into it because of decisions made in the 1990s that caused long-term retiree obligations to explode. The TriMet Board realized that changes were necessary and voted to move all new, non-union hires into defined-contribution pensions after 2002.

Resistance from the bargaining unit kept TriMet from moving its new unionized workers to defined-contribution plans for another decade, by which time a citizens’ committee had issued a report declaring TriMet “on the brink” of disaster. During a protracted negotiation with the union in 2012, TriMet CFO Beth deHamel testified at a binding arbitration hearing that unless changes were made, “TriMet could be forced to default on its pension obligations or its other financial obligations in the future.”

Union leadership eventually agreed to move all new members to defined-contribution pensions by 2013. As a result, the number of active employees still accruing defined-benefit pension benefits fell from 1,580 to 1,460 during 2016. Last year, the unionized workers’ defined-benefit account reached nearly 80 percent funding; and the long-term, unfunded pension liability dropped by nearly $50 million.

The defined-contribution plan to which TriMet moved new workers has been recognized as one of the best in the country. It features low costs, high returns, and a guaranteed employer contribution that is paid irrespective of employee matching contributions.

TriMet’s pension reform offers a valuable guide to the Oregon legislature on how to contain and reverse the spiraling PERS disaster. The unfunded liabilities for PERS have grown from $16 billion to more than $25 billion in less than ten years.

Some reduction in PERS benefits will have to happen, and all parties will benefit from an orderly transition while there is still time. The state should emulate TriMet by moving its employees from defined-benefit to defined-contribution plans as soon as possible.  However, the legislature will be obliged to make bigger changes than would have been required years ago. It will have to move all current workers, whenever they were hired, to defined-contribution plans for all work performed after the date of the effective legislation.

The sooner this is done, the less painful later steps will be. As former TriMet General Manager Neil McFarlane noted recently, solving a pension crisis “doesn’t get any easier with passing time.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization. Scott Shepard is a lawyer who recently authored a new case study of TriMet’s pension reform for Cascade Policy Institute. The study, “Following in TriMet’s Tracks: Defined-Contribution Pensions a Necessary First Step to Oregon’s Fiscal Health,” is available here. A version of this article originally appeared in The Portland Tribune.

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In 9 Years, WES Hasn’t Decreased Westside Congestion

By John A. Charles, Jr.

February marked the nine-year anniversary of the Westside Express Service (WES), the commuter rail line that runs from Wilsonville to Beaverton. Sadly, there was little to celebrate.

A central problem is that WES never had a clear mission. At various times the train was promoted as: (1) a congestion relief tool for Highway 217; (2) a catalyst for so-called “Transit-Oriented Development;” or (3) a way of providing “another option” for travelers. None of these arguments has panned out.

During legislative hearings in Salem, representatives from Washington County claimed WES would take 5,000 motor vehicles per day off of nearby highways. But WES is not capable of that because it only runs eight times (each direction) in the morning, and eight times in the afternoon. Unlike traditional commuter trains pulling eight or nine passenger cars, WES travels only in one- or two-car configurations.

During its best hours of performance, the total number of passengers is less than 0.5% the number of motorists traveling on Highway 217/I-5 at those hours, so there has been no congestion relief.

Prior to WES, two TriMet bus lines provided more than 4,000 boardings per day in parallel routes. Commuter rail has replaced inexpensive bus service with a massively subsidized train. Taxpayers would be better served if we canceled WES and moved commuter rail customers back to buses.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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WES at 9: Time to Admit the Mistake

By John A. Charles, Jr.

February marked the nine-year anniversary of the Westside Express Service (WES), the 14.7-mile commuter rail line that runs from Wilsonville to Beaverton. Sadly, there was little to celebrate.

In the first few years of operation, ridership grew and it was at least plausible that WES eventually could become a productive transit line. However, average daily ridership peaked in 2014 at 1,964 daily boardings, then dropped in each successive year. During fiscal year 2018, WES ridership has averaged only 1,668 daily boardings.

A central problem is that WES never had a clear mission; it was always a project in search of a purpose. At various times the train was promoted as: (1) a congestion relief tool for Highway 217; (2) a catalyst for so-called “Transit-Oriented Development;” or (3) a way of providing “another option” for travelers. None of these arguments make sense.

During legislative hearings in Salem, representatives from Washington County claimed that WES would take 5,000 motor vehicles per day off of nearby highways. But WES is not even capable of doing that because it only runs eight times (each direction) in the morning, and eight more times in the afternoon. Unlike traditional commuter trains pulling eight or nine passenger cars, WES travels only in one-car or two-car configurations. The train stations themselves are so short that even if TriMet started running eight-car trains, most passengers would have no way to get on or off.

During its best hours of performance, the total number of passengers traveling on WES is less than 0.5% the number of motorists traveling on Highway 217/I-5 at those same hours, so there has been no congestion relief.

Moreover, WES crosses more than 18 east-west suburban arterials four times each hour. On busy commuter routes, such as Highway 10 or Scholls Ferry Road, each train crossing delays dozens of vehicles for 40 seconds or more. Since the train itself typically only carries 50-60 passengers per run, this means that WES actually has made Washington County congestion worse than it was before the train opened.

WES has not been a catalyst for “transit-oriented development” and never will be because the train stations are a nuisance, not an amenity. The noise associated with train arrivals was always underestimated and is not likely to induce new residential construction.

As for the hope that WES would provide “another transit option,” there were already two TriMet bus lines providing over 4,000 boardings per day in parallel routes prior to the opening of WES. Commuter rail simply replaced inexpensive bus service with a massively subsidized train.

Several key statistics summarize the problems with the train:

  • WES was originally projected to cost $65 million and open in 2000. It actually cost $161.2 million and opened in 2009.
  • TriMet projected an average daily ridership of 2,500 weekday boardings in the first year; actual weekday ridership was 1,156. It grew over time to 1,964 in 2014, but dropped to 1,771 in 2016 and 1,668 in 2018. Since each rider typically boards twice daily, only about 850 people actually use WES regularly.
  • The WES operating cost/ride is roughly five times the cost of average TriMet bus service.

Ridership and Cost Trends for WES

2009-2018

(inflation adjusted, 2015 $)

2009 2010 2011 2012 2014 2016 2018 % Change since 2014
   
Avg. daily boardings 1,156 1,313 1,571 1,700 1,964 1,810 1,668 -15%
Operating cost per ride $27.41 $24.46 $20.43 $18.39 $15.85 $13.55 $16.73 +6%
Cost/

train-mile   

$54.70 $54.12 $53.30 $53.79 $51.12 $53.82 $60.56 +18%
Cost/

train hour

$1,180 $1,166 $1,171 $1,180 $1,109 $1,178 $1,307 +18%
Average subsidy/ride $26.18 $23.00 $19.01 $17.64 $14.36 $12.07 $15.30 +7%

In June 2016 TriMet staff persuaded the Board to approve the purchase of two used rail cars to expand the WES fleet. The estimated cost for the purchase was $1.5 million, plus $500,000 more for retrofitting.

TriMet claimed that this purchase was necessary to satisfy the “expected demands for growing WES service.” That demand was a fantasy.

WES is destined to be a one-hit wonder―an expensive monument to the egos of TriMet leaders and Westside politicians. Taxpayers would be better served if we simply canceled WES, repaid grant funds to the federal government, and moved the few commuter rail customers back to buses.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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TriMet Shows Public Pension Reform Is Possible

By John A. Charles, Jr.

The Oregon legislature recently adjourned and once again took no action to reduce the unfunded liabilities of the Oregon Public Employee Retirement System (PERS). The reason is that most legislators think PERS reform is impossible. 

That belief is wrong. 

TriMet is not part of PERS and has been slowly reforming its pension program since 2002. As a result, 100% of all new employees are now in 401(k)-style pensions that have no long-term liabilities for employers. These are referred to as “defined-contribution” (DC) pensions in which monthly payments are made by management into retirement accounts owned by employees. Once those payments are made, the employer has no further financial obligations. 

This stands in contrast to “defined benefit” (DB) programs like PERS in which employees are promised high levels of retirement payments regardless of how investment funds are performing. 

The success of the TriMet reforms can be seen in its latest pension fund valuation, which shows that annual benefit payments for pensions will peak in 2034 at $75 million, then drop to zero by about 2085.           

TriMet’s pension reform offers a guide to the legislature on how to reverse the spiraling PERS disaster, where unfunded liabilities have grown to $25 billion. The state should move all employees to defined-contribution plans as soon as possible. 

This essay summarizes a new Cascade study of TriMet’s successful pension reform program. “Following in TriMet’s Tracks: Defined-Contribution Plans a Necessary First Step to Oregon’s Fiscal Health” can be found here.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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TriMet Shows That Public Pension Reform Is Possible

By Scott Shepard and John A. Charles, Jr.

The Oregon Legislature is currently meeting, and the conventional wisdom is that reform of Oregon’s overly generous Public Employee Retirement System (PERS) is impossible. According to Governor Kate Brown, we signed contracts with public employee unions, a deal is a deal, and we should just quietly accept our fate that the massive cost of PERS will lead to layoffs and service cuts at schools and other service providers.

There is another way.

The Portland regional transit district, TriMet, is not part of PERS and has been slowly reforming its pension program since 2002. As a result, 100% of all new employees are now in 401(k)-style pensions that have no long-term liabilities for employers. These are referred to as “defined-contribution” (DC) pensions in which monthly payments are made by management into personal accounts owned by employees. Once those payments are made, the employer has no further financial obligations. The eventual pension payouts will be a function of the market performance of whatever investments are chosen by individual employees.

This stands in contrast to “defined benefit” (DB) programs like PERS in which employees are promised various levels of retirement payments calculated through arcane formulas that leave management mostly clueless about the level of funding obligation they’ve agreed to. In many cases, those liabilities turn out to be much larger than expected.

The advantages for taxpayers of moving public employees into DC pensions is now evident in the actuarial valuations done for TriMet. According to the most recent valuation, projected annual benefit payments for TriMet DB pensions will peak in 2034 at $74.6 million, and then steadily decline to $6 million in 2072. They will hit zero by the turn of the century.

This was not something that TriMet did casually. Management was forced into it because of decisions made a decade earlier that caused long-term retiree obligations to explode. TriMet Board members are appointed by the governor. In the early 1990s, Governor Barbara Roberts and TriMet General Manager Tom Walsh wanted public approval of a massive expansion of TriMet’s light rail empire and the tax funding to pay for it. They feared that controversy about a union contract could endanger public support.

In their efforts to avoid strife, in 1994 they granted expensive concessions to the Amalgamated Transit Union Local 757 (“the ATU”) on behalf of its represented employees. Loren L. Wyss, the long-serving president of TriMet, objected and his battle with Walsh became public. In back-channel communications with Gov. Roberts, Walsh made it clear that either he or Wyss needed to go. In August 1994, Wyss met with Gov. Roberts, where he submitted his resignation.

As later explained in The Oregonian,

“…the contract just approved by Tri-Met union employees will protect all its members from additional contributions to their pensions for 10 years. It will also guarantee 3 percent minimum wage increases in the future…every single dollar of health, welfare, dental and vision plans will be paid for by the public employer; [and] the retirement age will decline to 58 within 10 years….”

The die was set for cost escalation. In the decade from 1994 to 2004, salaries and wages increased 72 percent; annual pension costs went up 160 percent; and the cost of health care benefits rose 116 percent. These increases plus stagnant revenues in the latter half of the period resulted in a tripling of unfunded pension liabilities, from $38 million in 1993 to $112.4 million in 2002.

Fred Hansen followed Tom Walsh as General Manger; and he moved new, non-union hires into DC pensions after 2002. This was a first step towards fiscal sanity. Resistance from the ATU kept TriMet from moving its new unionized workers to DC plans for another decade, by which time a citizens’ committee of Portlanders had issued a report declaring TriMet “on the brink” of disaster.

During a protracted negotiation with the union in 2012, TriMet CFO Beth deHamel testified at a binding arbitration hearing,

“TriMet’s union defined benefit plan would be placed on critical status and under federal oversight if it were a private pension plan subject to ERISA.” She also stated that unless something was done to shore up the plan, “TriMet could be forced to default on its pension obligations or its other financial obligations in the future.”

Union leadership eventually agreed to move all new members to DC pensions by 2013, while protecting existing members from reform. As a result of this delay, the union workers’ DB fund remained only 59 percent funded in 2013.

Nevertheless, the trends were now moving in the right direction. The number of active employees still accruing DB pension benefits fell from 1,580 to 1,460 from 2016 to 2017 alone. In 2017 the unionized workers’ DB account reached nearly 80 percent funding, with unfunded liability falling by nearly $50 million in a single year.

Neil McFarlane was TriMet General Manager during that era. He commented recently, “The shift [to DC pensions] has been a success. TriMet is paying more than the required annual contribution every year right now” because the system is closed. “We will be fully funded within the next few years: five to ten for the union plan, fewer for the non-union.”

The DC plan to which TriMet moved new workers has been recognized as one of the best in the country. It features low costs, high returns, and a guaranteed employer contribution that is paid irrespective of employee matching contributions. As a DC plan it does not create open-ended, unpredictable public liabilities to be paid by generations as yet unborn.

TriMet has not fully banished the ghosts of unsustainable employee-benefit promises past. It still faces a massive and escalating unfunded liability driven by health care costs, known in accounting jargon as “other post-employment benefits,” or OPEB. The health care benefits that TriMet granted away in the 1994 contract debacle have been described as “universal health care into the afterlife.”

The description is only a minor exaggeration, as the plan offered TriMet’s unionized employees health care without premiums and with mere $5 co-pays, and benefits that ran not only throughout retirement, but to the employees’ spouses and dependents for fully 16 years after the employees’ deaths. Total unfunded liability for OPEBs reached an astonishing $769 million dollars in 2016.

Compare: State Paralysis on PERS 

TriMet’s pension reform efforts offer a valuable guide to the Oregon legislature on how to contain and reverse the spiraling PERS disaster. The unfunded liabilities for PERS have grown from $16 billion to more than $25 billion in less than ten years, even with the far-too-optimistic 7.2 percent assumed-savings rate (i.e., discount rate) in place. Were the rate adjusted down to its actuarially appropriate level, PERS’ unfunded liability would explode to $50 billion or more at a stroke.

Even at the current recognized rate, funding status has fallen below 70 percent, even while mandatory payments to PERS by government employers have passed 26 percent of payroll.

Municipalities are laying off workers, depleting public services, and raising fees in order to fund the present level of recognized PERS unfunded liabilities. Some reduction in pension benefits will have to happen, one way or another. All parties will benefit from an orderly effort to reform benefits while there is still time. 

The Way Forward

The state should follow the tracks laid by TriMet by moving its employees from DB to DC plans as soon as possible. As TriMet has demonstrated, this move will begin to stanch the fiscal wounds that have been inflicted by a generation of recklessly overgenerous pension benefit promises.

Unfortunately for everyone, PERS reform has been hamstrung for more than 20 years by a wayward state Supreme Court, which has thwarted previous attempts at thoughtful change with erroneous interpretations of the federal Contract Clause. The legislature will be obliged to make bigger changes than would have been required years ago. It will have to move all current workers, whenever they were hired, to DC plans for all work performed after the date of the effective legislation.

While this reform will be significant, it also will be deeply equitable. Right now, older workers are receiving higher benefits for each hour worked than ever will be available to younger workers. This isn’t fair, and it may violate civil rights laws: Younger workers are more diverse than their older peers, which means that benefit reductions that affect only new workers have a disparate impact on women and minorities.

The reform will also pass constitutional muster. As the Oregon Supreme Court finally recognized in its Moro decision, correcting its long-held error, the legislature may change any benefits for work not yet performed, even for current employees.

The Oregon Legislature can and must follow TriMet’s example. The sooner this is done, the less drastic any later steps will be. According to TriMet General Manager McFarlane, solving a pension crisis “doesn’t get any easier with passing time.”

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free-market research center. Scott Shepard is a lawyer and was a visiting law professor at Willamette University during 2016. This essay is a summary of a case study of TriMet’s pension reform written by Mr. Shepard for Cascade Policy Institute. The full report is available here. This essay was originally published in the February 2018 edition of the newsletter “Oregon Transformation: Ideas for Growth and Change,” a project of Third Century Solutions.

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Following in TriMet’s Tracks: Defined-Contribution Pensions a Necessary First Step to Oregon’s Fiscal Health

By Scott Shepard

Scott Shepard is a lawyer and was a visiting law professor at Willamette University in Salem, Oregon during 2016. He is the author of “A Lost Generation but Renewed Hope: Oregon’s Pension Crisis and the Road to Reform,” an academic study on Oregon state pensions published August 1, 2017 by the Mercatus Center at George Mason University. He is an Academic Advisor to Cascade Policy Institute, Oregon’s free-market public policy research center.

Introduction 

As recently as 2012, TriMet faced a pension funding disaster. Indefensibly overgenerous pension benefits granted in the early 1990s threatened to bankrupt the public transit system and to cripple the Portland metro area. While TriMet still has difficult reform ahead of it (regarding its other post-employment benefits promises), it has achieved pension fund stability by replacing its unsustainable defined-benefit pension promises with a well-designed, defined-contribution retirement plan.

“Defined-contribution” (DC) pensions are retirement benefit plans in which monthly payments are made by management into personal accounts owned by employees. Once those payments are made, the employer has no further financial obligations. The eventual pension payouts will be a function of the market performance of whatever investments are chosen by individual employees.

This stands in contrast to “defined-benefit” (DB) programs like Oregon’s Public Employees Retirement System (PERS). Under DB programs, employees are promised various levels of retirement payments calculated through arcane formulas that leave management mostly uninformed as to the level of funding obligation to which they have agreed. In many cases, those liabilities turn out to be much larger than expected. 

TriMet has brought its pension funding liabilities under control by moving its employees from defined-benefit plans to defined-contribution plans: first its management employees hired after 2002, then its unionized employees hired after 2012. The shift followed the lead of most private sector businesses, the federal government, and an increasing number of states. As a result of the change, TriMet’s pension obligations are moving steadily and reliably toward full funding within the near to medium term. This glide path to full funding is allowing the organization to focus on other vital personnel issues such as managing the cost of other post-employment benefits (“OPEBs,” which are primarily health care benefits for unionized workers) for current workers and retirees.

Oregon and its municipalities can only envy TriMet in this regard. The defined-benefit PERS funding costs continue to spiral out of control. These unbridled expenses are crushing local governments and school districts, forcing layoffs, hiring and wage freezes, bigger class sizes, reduced government services, and increased taxes. The failure to reform harms younger and more diverse workers at the expense of their older colleagues, and private-industry workers in favor of their government-employee neighbors. Taxpayers have said “enough,” voting 60-40 in 2016 against significant state tax hikes that inevitably would have been dedicated to helping to fund the PERS shortfall.

One necessary step toward addressing this problem is for the state of Oregon to follow in TriMet’s tracks, moving PERS workers from DB to DC plans. TriMet started down this road fully 15 years ago, while the state has dithered. Oregon must play catch-up by moving all PERS-covered workers to DC plans for work to be performed after the changeover.

This move by itself likely will not be enough to solve Oregon’s public pension crisis. The state has already promised more than it can reasonably pay. But moving to DC plans for all work not yet performed is a necessary first step. And the faster the legislature acts, the less severe—and the less upsetting to retirees and current and future employees—will be the other reforms required later.

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TriMet Needs a Broader Definition of Diversity

By John A. Charles, Jr.

TriMet has been recruiting a new General Manager for the past six months. At its January meeting, the Board announced the name of the leading contender and offered the public a chance to ask questions.

Before the questioning began, however, an executive search firm hired by TriMet summarized the recruiting process. Celia Kupersmith of KL2 Connects said that more than three dozen applications had been vetted, and a significant number of them were women or racial minorities. A black woman was one of three finalists.

However, the top applicant was Doug Kelsey, a white male currently employed by TriMet.

Many activists in the audience criticized the process. They complained that TriMet had proceeded too quickly and with not enough transparency. In particular, they were upset that virtually all applicants requested privacy in order to protect the jobs they already had. Soon thereafter, the TriMet Board announced that it would delay a final hiring decision while it reassessed its process.

Many of TriMet’s critics have a naïve view of the business world, and it shows in the self-contradictory nature of their demands. They want a deep pool of talent, rich with ethnic and gender diversity, but they also want a very public process. The two goals are mutually exclusive. Complete transparency means most qualified candidates will not apply.

They also have a narrow concept of “diversity.” Race and gender are just two attributes the Board should consider. What about intellectual diversity?

TriMet has been working off the same philosophical playbook for over 35 years. The focus has always been two-fold: (1) building a network of low-speed, low-capacity light rail lines; and (2) maintaining “labor peace” by agreeing to wage agreements that include expensive retiree benefits. That vision is looking very stale these days.

TriMet’s ridership is in a steady decline. It peaked in fiscal year 2012 and ridership has dropped in each of the last three years. Only 2.4% of total travel in the Portland region takes place on transit, making it irrelevant or even a nuisance to most taxpayers.

Light rail has lower ridership today than before the Orange line to Milwaukie was built. During FY 2017, boarding rides per-hour on MAX reached the lowest level since light rail opened in 1986.

TriMet’s financial position would be unsustainable were it not for massive and growing subsidies. During the past two decades, TriMet has promised so much to employees in the form of pensions and post-employment health care benefits that the agency now has unfunded liabilities of nearly $1 billion.

At the TriMet hearing in January, I asked Mr. Kelsey whether he saw any possibility that TriMet’s next light rail project—a multi-billion line to Bridgeport Village—might be canceled under his leadership, given the problems stated above. He responded that light rail was still a very important part of TriMet’s planning and he was not about to abandon it.

That answer concerned me because TriMet seems wedded to an outdated business model. Both in Portland and elsewhere, ridesharing companies such as Uber and Lyft are steadily eroding the market share of both regulated taxis and transit operators. This trend will only accelerate as autonomous vehicles become a reality.

Over the next 20 years, shared driverless cars likely will revolutionize the transit industry. Capital-intensive light rail and streetcar systems will face rising costs with declining ridership, creating a fiscal death spiral.

TriMet and its executive search consultants have done a commendable job of recruiting a diverse field of CEO candidates when measured by race and gender. What is lacking is a broader concept of “diversity” to include new ways of thinking about transit.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization. A version of this article originally appeared in The Portland Tribune.

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For Green Activists, the Cleanest Cars in History Are Bad News

By John A. Charles, Jr.

The Oregon Legislature convened again this week. A top priority for some officials is SB 1507,

which would create an energy rationing program that likely would increase the cost of gasoline to more than $7 dollars per gallon by 2035. This is being promoted as a means of reducing carbon dioxide, which some people think is a pollutant.

Coincidentally, the Environmental Protection Agency just released its latest update of automobile emissions trends for carbon dioxide. The report shows that CO2 emissions per mile for all motor vehicles sold in 2017 were the lowest since the agency began collecting data in 1975.

For truck SUVs, the reduction since 1975 was 50%. For minivans it was 51%. For standard passenger cars it was 55%. Almost miraculously, automakers have produced the cleanest cars in history while also making them much safer and more pleasant to drive than the 1975 models.

One would think that environmental advocates would be pleased with this success story, but good news is actually bad news for activists. They can only pass onerous legislation when everyone thinks we have a crisis.

We don’t have a crisis, and we don’t need this bill.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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Road Policy Belongs to Those Who Show Up

By John A. Charles, Jr.

The Oregon Department of Transportation is hosting three Open Houses this month to discuss the possibility of changing how several local highways are managed.

Currently, we finance roads through gasoline taxes. However, a growing number of cars use little or no gasoline. Therefore, the legislature is requiring ODOT to study an alternative finance mechanism for I-205 and part of I-5 that would rely on user fees collected electronically.

In addition, those fees would vary in price depending on the time of day, direction of travel, and day of the week.

While this may sound punitive, the fact is that a single highway lane can move anywhere from 700 vehicles per lane, per hour, to more than 2,000 vehicles, depending on the density of traffic. At times of hyper-congestion, throughput drops dramatically as we sit in stop-and-go conditions.

An alternative would be to use variable toll rates to even out demand, thereby tripling the number of cars per lane while averaging about 45 miles per hour.

Is it a good idea to make our highways three times more productive through congestion pricing? That’s what the Open Houses will explore. Interested motorists should attend, because policy belongs to those who show up.

 

This is the schedule for ODOT’s community conversations, according to the department’s press release:

  • Tuesday, Jan. 23, 4:30 to 7:30 p.m., Clackamas Town Center Community Room (Level 1 near Buckle and across from Macy’s), 12000 S.E. 82nd Avenue, Happy Valley
  • Saturday, Jan. 27, 10 a.m. to 1 p.m., Lloyd Center (Level 1 between Ross and the ice rink), 2201 Lloyd Center, Portland
  • Tuesday, Jan. 30, 4:30 to 7:30 p.m., Vancouver Community Library, 901 C Street, Vancouver.
  • 17 to Feb. 5, the Online Open House will be active at odotvaluepricing.org. The public can see materials, view video recordings of the project Policy Advisory Committee meetings and leave comments for the project team.

 

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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Poll Shows Voters Are Smarter Than Politicians Think

By John A. Charles, Jr.

In November the regional government, Metro, released the results of a new public opinion poll of 800 registered voters living in the tri-county region.

One of the questions was, “In a few words of your own, what is the most important change that could be made to improve the quality of life in the Portland region?”

The top three responses were: dealing with the homeless/poverty (25%); affordable housing (17%); and traffic congestion (14%).

Environmental issues tied for last place (2%), and global warming did not even make the list.

This is roughly the opposite of what we frequently hear from many of the political talking heads. Listening to them, one would think that environmental Armageddon is upon us, especially because Donald Trump is President.

For instance, the top legislative priority for Senator Michael Dembrow (D-Portland), who chairs the Senate Environment Committee, is a bill he hopes to pass in early 2018 that would create a $700 million/year tax on carbon dioxide by establishing a convoluted industrial regulatory program. The ambient environment would not be improved one bit by this tax, but all of our basic necessities—food, clothing, shelter, and energy—would become more expensive.

Sen. Dembrow’s biggest supporter on this issue is Governor Kate Brown, who recently flew to Bonn, Germany to hobnob with celebrities at a United Nations conference on global warming. The two of them are convinced that if they can make energy more expensive, we’ll all use less of it and the world will be saved from “global warming.”

Most voters intuitively know that this is a scam. The term “global warming” doesn’t even have a useful definition. Voters know that the pain-versus-gain equation of global warming taxes is heavily one-sided: the “benefits” of reducing fossil fuel use are highly speculative (and may not exist at all); long-term (potentially thousands of years away); and global in nature. Yet the costs will be known, immediate, and local.

As the Metro poll shows, there is very little grassroots support for this kind of punishment.

It’s not surprising that homelessness, housing, and traffic congestion rank as the top three issues in the Metro poll because these are problems most of us confront daily. They are also things we can take action on.

Unfortunately, government itself has caused much of the mess, so voters will need to think carefully before signing on to more tax-and-spend programs. Almost every time regulators intervene in real estate markets, the result is some combination of less housing production and higher housing prices.

Take the most obvious intervention: urban growth boundaries. Since 1980, the population of the Portland metro region has increased by about 78%, but the available land supply for housing has only gone up by 10%. Making buildable land artificially scarce and thus more expensive is not a winning strategy if you’re trying to provide more housing.

But lack of land is just the start. After you add in ubiquitous farm and forestland zoning, extortionist system development charges, tree protection ordinances, inclusionary zoning requirements, prevailing wage rules on public housing projects, and numerous other interventions, the result is that we have a serious shortage of housing.

Even the government is trapped in government regulation. Last spring the Portland City Council approved spending $3.7 million to purchase a strip club on SE Powell Boulevard near Cleveland High School. The City plans to tear down the building and build 200 to 300 units of low-income public housing on the 50,000-square-foot property. City officials have admitted that it will take two years just to obtain the necessary permits for the redevelopment.

If it takes this long to get the permits for one of Mayor Ted Wheeler’s top priorities, imagine the delays facing a private sector developer.

The housing woes in such cities as Portland, San Francisco, New York, and Seattle are mostly self-inflicted. Housing supply is lagging demand because we’ve created so many barriers to housing construction. Removing those barriers should be a top priority for the state legislature when it convenes in February.

Global warming legislation does not even deserve a hearing.

John A. Charles, Jr. is President and CEO of the Portland-based Cascade Policy Institute, Oregon’s free market public policy research organization. A version of this article was published by the Pamplin Media Group and appeared in The Portland Tribune.

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Tolling People on to Portland’s Highways

Tolling People on to Portland’s Highways

By John A. Charles, Jr.

Earlier this year the state legislature passed a bill requiring the Oregon Transportation Commission (OTC) to apply for federal authorization to implement “value pricing” on two regional highways: I-205, and I-5 from the Washington border to the intersection with I-205. The OTC must apply by December 31, 2018.

Although value pricing may sound vague or somewhat ominous, motorists should be happy with this new policy. It has the potential to eliminate traffic congestion and create a revenue stream that will allow us to build the new highways and bridges that we need.

First, some background. “Value pricing” is a bureaucratic term for electronic tolling of highways where the toll rates vary based on the density of traffic. Usually, the rates change based on time of day, direction of travel, and day of the week. The rates are set to ensure 45 MPH driving conditions at all times of the day, hence the “value” offered to motorists.

There are many possible variations on this theme. In most cases, value pricing is used on new highway lanes, allowing drivers the option of staying in the unpriced, general purpose lanes. That probably will not be feasible in the Portland region because there is no room for an entire new network of priced lanes on I-5.

In some ways this is a blessing, because variable tolling will make our current lanes more productive. If priced properly, it’s possible that new lanes will not even be needed, saving us the expense of construction.

Value pricing is necessary because our current system cannot address congestion. Our highway network is an open access system, where each trip appears to be “free.” Of course, it’s not free—it’s being paid for by various back-door mechanisms such as motor fuel taxes, vehicle registration fees, and random federal grants. But we think it’s free, so during peak hours we see a “stampede” effect.

When too many people try to get on at the same time, per-lane throughput drops substantially. The carrying capacity for most highways is roughly 1,800 vehicles per-hour in each lane. At times of hyper-congestion, this can drop to 900 vehicles or fewer.

By using variable pricing, we can clear up the stampede and get per-lane travel back to 1,600 or 1,800 vehicles per-hour. In essence, value pricing allows us to “toll on” more people than we “toll off.”

The effect of this was seen recently when tolls on the Port Mann Bridge in Canada were removed on September 1. The Port Mann is a 10-lane bridge over the Fraser River near Vancouver. After tolls were removed, the result was a huge increase in congestion. One driver saw her daily commute increase by 25 minutes each way. She told a news reporter, “Absolutely, it’s terrible. It’s selfish but I want those tolls back on.”

In addition to the benefits of free-flow driving conditions, variable tolling will also create the dedicated revenue stream we need for future highway expansion. There is no doubt that we need several new bridges over the Columbia River, plus additional highway lanes elsewhere. Value pricing will tell us where to build, when to build, and who is willing to pay.

Fortunately, the Oregon Constitution does not allow toll revenues to be siphoned off for non-highway uses such as light rail construction. Therefore, money paid by motorists will benefit them directly.

The new law mandates value pricing on two specific highways but also authorizes the OTC to implement pricing anywhere else. Since the Portland highway network is an integrated system including I-84, I-5, I-405, HW 26, HW 217, and I-205, it would be better to implement value pricing region-wide to ensure that motorists get what they want: free-flow driving conditions, at all times of the day.

Most new highways being built around the world are using electronic tolling with variable rates. The new Oregon law is an opportunity for us to learn from that experience and to implement a Portland highway pricing system that truly delivers “value” for motorists.

John A. Charles, Jr. is President and CEO of the Portland-based Cascade Policy Institute, Oregon’s free market public policy research organization. A version of this article was originally published by the Pamplin Media Group and appeared in the Wilsonville Spokesman and The Portland Tribune.

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Portland’s latest attempt to centrally plan transportation patterns is backfiring

By Jessica Miller

Portland has a longstanding history of attempting to socially engineer people’s transportation patterns, and the “Better Naito” project is no different.

In 2015, a group of students from Portland State University created the idea of “Better Naito” as their capstone project. From April 28th until September 30th each year, Portland planners intend to enhance the lives of pedestrians and bikers along the Waterfront by reducing car capacity from two lanes to one on SW Naito Parkway and transforming one lane into an open area for walkers and bikers. The project was implemented and paid for by the Portland Bureau of Transportation (PBOT), Portland State University (PSU), Better Block PDX, and $350,000 from the Portland City Council.

Advocates of “Better Naito” claim that “[f]eedback from the public was very positive,” but there is more to the story. After receiving copious amounts of negative feedback from business owners who see fewer shoppers, employees who experience longer commutes, and shoppers who can’t reach desired downtown destinations, the Portland Businesses Alliance created a petition to the Portland City Council in opposition to “Better Naito.” They claim the project is “harmful to our city’s economy and extremely disruptive to commuters.”

It’s no surprise Portland’s latest attempt to centrally plan commuters’ lives is backfiring, but that hasn’t stopped advocates from making the project annual. To voice your opinion on “Better Naito,” visit the Portland Business Alliance’s online petition.


Jessica Miller is a Research Associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

 

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Transportation Finance Isn’t as Complicated as Legislators Make It

By John A. Charles, Jr.

Some members of the Oregon Legislature think you don’t pay enough to travel. Therefore, they are considering a 298-page bill that would create multiple new transportation taxes.

The draft legislation, HB 2017, includes dramatic increases to vehicle registration fees, higher gas tax rates, a new sales tax on the purchase of motor vehicles and bicycles, and a statewide tax on all employees to subsidize transit.

In addition, a percentage of money currently paid by customers of investor-owned electric and gas utilities would be diverted to subsidize electric vehicle owners.

Billions of dollars would flow to various bureaucratic entities, with little accountability. Those of us paying the taxes would hardly know we’re paying them, and we would have no idea how the money was being spent.

The legislative strategy of simply “throwing money” at transportation is not going to work, because it’s already been tried. For example, TriMet riders only account for about 10% of all revenue in the FY 18 budget; the rest of TriMet’s income is derived from various backdoor taxes.

The agency’s most lucrative income source is the regional payroll tax, authorized by the legislature decades ago. TriMet has been raising its payroll tax rate almost every year since 2005 and will continue to do so through 2024. As a result, the agency now collects over $366 million annually from employers to subsidize transit operations. Yet, in the first decade after tax rates began rising, TriMet service actually declined.

Much of the new money went to pay for generous union contracts rather than the promised service improvements. The result: In 2016, employee benefits equaled 123% of wages. In other years the ratio has been as high as 149%. This is not a finance model that we should emulate.

The best way to improve any kind of service is to have a tight fit between what we pay as consumers and what we get in return. If we don’t know the real price, we can’t evaluate the purchase. And if taxpayers are being forced to subsidize unrelated services, there can be no fiscal discipline.

A better option would be to euthanize this 298-page monstrosity and work to implement highly-targeted user fees. The social costs of travel such as congestion, road wear, and noise pollution vary considerably by time of day, direction of travel, weight of the vehicle, and other factors. The user fees that we pay should account for these differences.

Gasoline taxes and vehicle registration fees are poor user fees because they are fixed, mostly invisible, and not time-sensitive. But new technologies now allow us to collect the full cost of each trip in real time by all modes of travel.

Some auto insurance companies already collect detailed driving data because they sell mileage-based policies. Millions of American drivers also own toll tags for use in modern tollways. And many transit operators use digital technology to collect variable fees based on distance traveled, type of service, and time of day.

User fees should be precisely calculated, and revenues should be dedicated to maintaining and improving the services paid for by consumers, with no cross-subsidization of other modes.

Transportation finance doesn’t have to be complicated. Legislators only make it that way when they don’t want you to know where the money is going.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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The Case of the Missing Transit Money

By John A. Charles, Jr.

Last week the TriMet Board adopted a budget for fiscal year 2018, which begins on July 1.

As usual, the budget shows no correlation between the levels of subsidies given to TriMet and the amount of service provided to customers.

For example, in 2008, TriMet had a total of $397 million to pay for operations of bus and rail service. In 2018, the agency predicts it will have $600 million, a 51% increase. Yet bus service—which carries two-thirds of all passengers—has barely improved.

In 2008 the “revenue-miles” of bus service (those miles where buses were in operation) totaled 22,574,030. If service increases in 2018 as planned, the total is likely to be 22,597,927—only a 0.1% increase.

Where did all the money go?

TriMet claims that increased light rail service made up the difference, but between 2008 and 2016 the revenue-miles of MAX only went up 14%. No service increase in 2018 will make up the difference between 14% and 51%.

Moreover, ridership is not growing along with the increased funding. In fact it is shrinking. During 2008 the total number of “originating rides” (which excludes transfers) was 77.6 million. Ridership peaked in 2012 at 80 million, and then dropped to 77.2 million in 2016.

TriMet is also losing market share, especially at peak hours. According to the Portland city auditor, in 2008 an estimated 15% of all Portland commuters used TriMet. By 2016, that had dropped to just 10%.

The steady rise in TriMet’s revenue is almost entirely due to tax subsidies, not passenger fares. In fact, next year passenger fares will only account for 10% of TriMet’s all-funds budget—likely the lowest level of passenger support in TriMet history.

Nonetheless, the Oregon legislature is considering a bill that would authorize a new, statewide employer tax that would generate even more subsidies for transit. The Portland experience shows that this is a bad idea. The more we subsidize monopoly transit, the more the employees divert funds for their own use.

Last year TriMet spent $1.23 on employee benefits for every $1.00 expended in wages. That largely explains why service levels have been stagnant.

In 1969 the Portland City Council put Rose City Transit out of business because Councilors believed that a government-run monopoly would be much more efficient than a private-for-profit company. The TriMet experience has shown that the City Council was wrong.


John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

 

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The Greatest Challenge to Traffic Safety? It’s Not Residential Speed Limits

By John A. Charles, Jr.

Earlier this week the Oregon House of Representatives passed HB 2682, which will allow Portland to lower traffic speeds on residential streets from 25 MPH to 20 MPH. This was hailed as an important step towards reaching the city’s goal of zero traffic fatalities by 2025, but in reality the bill is mostly symbolic.

First, HB 2682 only affects residential streets. Most traffic fatalities occur on higher-speed arterials.

Second, reducing travel speed is just one of many factors in traffic safety, and not always the most important. According to the 2015 Portland Traffic Safety Report, 54% of fatal crashes involve alcohol or drugs. When pedestrians are involved, 30% of fatalities involve either an intoxicated walker or driver.

Traffic speed is a factor, but 80% of Portland’s fatalities and serious injuries occur on the 19% of roadways that are posted at 30 MPH or higher. None of those roads will be affected by HB 2682.

The ubiquitous use of digital devices by motorists, cyclists, and pedestrians represents the greatest new challenge to traffic safety. Unfortunately, people who would rather text than watch the road are unlikely to be helped by a law that reduces speeds in quiet neighborhoods from slow to slower.


John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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Let’s Build Some Highways

By John A. Charles, Jr.

Oregon stopped building new highways in 1983 when I-205 was completed. Top planning officials began espousing a philosophy of spending money on rail transit rather than roads. The government also used the power of zoning to crowd more people into urban centers, in the belief that high density would lead to less reliance on cars.

The new strategy failed.

The Portland regional transit agency, TriMet, was given more than $3.6 billion to build a light rail system; yet between 1997 and 2016, TriMet’s market share of all commute trips in Portland fell from 12% to 10%. As a result, traffic congestion has become a major barrier to regional mobility.

Now a bipartisan group of legislators, led by Republican Rich Vial of Wilsonville and Democrat Brian Clem of Salem, has introduced a bill that would jump-start the highway-building process. HB 3231 would authorize cities and counties to jointly form special districts for the purpose of building and operating limited-access public highways.

If built, such highways would likely be financed through loans, with debt service paid off by tolls.

So far HB 3231 has not received a public hearing. It should. Motorists deserve all the highways they are willing to pay for. Let’s give them a chance to vote with their dollars for a better road system.


John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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Portland’s Regional Transit Strategy Is Not Working

By John A. Charles, Jr.

The Portland Auditor released the 2016 Annual Community Survey on November 30. The responses show that the share of all commute trips taken by public transit fell 17% during the past year.

This was part of a longer-term decline in transit use. The transit share of all Portland commute trips peaked in 2008 at 15%. Since then it has hovered near 12%, and now rests at 10%.

Taxpayers should be especially concerned about the negative correlation between passenger rail construction and market share. In 1997, when the region had only one light rail line—the Blue line to Gresham—transit market share was 12%.

After extending the Blue line to Hillsboro and adding four new lines plus the WES commuter rail and the Portland Streetcar, transit market share is only 10%.

Travel Mode Share for Weekday Commuting

Portland citywide, 1997-2016

Mode 1997 2000 2004 2008 2010 2012 2014 2015 2016
                   
SOV 71% 69% 72% 65% 62% 61% 63% 60% 61%
Carpool 9% 9% 8% 8% 7% 6% 6% 5% 6%
Transit 12% 14% 13% 15% 12% 12% 11% 12% 10%
Bike 3% 3% 4% 8% 7% 7% 8% 7% 8%
Walk 5% 5% 3% 4% 6% 7% 8% 9% 9%
Other n/a n/a n/a n/a 7% 6% 6% 7% 7%

      Source: Portland Auditor, Annual Community Survey

The numbers cited above are for citywide travel patterns. When broken out by sector, the Auditor found that just 5% of all commuters in Southwest Portland took transit to work in 2016. Despite this lack of interest by commuters, TriMet and Metro are working to gain approval for another light rail line extension from Portland State University through SW Portland to Bridgeport Village. The likely construction cost will be around $2.4 billion.

Unfortunately, there is no empirical basis for thinking that cannibalizing current bus service with costly new trains would have any measurable effect on transit use.

Transit advocates like to claim that we simply need to spend more money to boost ridership, but we’ve already tried that. TriMet’s annual operating budget went up from $212.2 million in 1998 to $542.2 million in 2016. After adjusting for inflation, that’s an increase of 72%. Those increases were on top of construction costs for rail, which cumulatively exceeded $3.6 billion during that era.

It’s time to stop the myth-making and start holding public officials accountable for a plan that isn’t working.


John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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Uber Translated: Better Service for the Underserved

By Lydia White

It’s not news that free-market visionaries provide better service than their corrupt competitors, but big government advocates are reluctant to admit it, even when such enterprise benefits their causes.

Ride-hailing services like Uber and Lyft provide cheaper, timelier, and higher quality rides. They better serve those with lower incomes and disabilities. They give Portland residents a local source of income. They also better comply with city regulations.

Uber serves high- and low-income communities equally; taxis underserve poorer neighborhoods. Ride-hailing services connect the disabled with handicap-accessible cars; taxi companies force disabled users to wait and hope for one to eventually pass by.

The Portland City Auditor claims the Portland Bureau of Transportation (PBOT) isn’t doing enough to “monitor the quality of service by ride-for-hire companies” and ensure riders from low-income communities or with disabilities are fairly served. Yet PBOT found that while Uber and Lyft provide a plethora of data (too much, in fact, for PBOT to analyze), taxi companies fail to comply with the Bureau’s requirements. Moreover, Uber’s internal rating system provides its own system of accountability—including cleanliness and efficiency.

The free market is forging ahead with 21st-century technology. While cronyism befell taxi companies, Uber and Lyft created an innovative alternative.

Proponents of big government should embrace the free-market sharing economy, especially if they truly wish to help traditionally underserved minorities.


Lydia White is a Research Associate at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Light Rail to Bridgeport Village: The Dumbest Train Project Yet

By John A. Charles, Jr.

TriMet and Metro are promoting the idea of a new light rail line from Portland State University to the Bridgeport Village shopping mall in Tualatin.

The question is, who would ride it?

We already know from experience that mall shoppers prefer private cars to trains. The Red Line to the airport was opened in 2001 specifically to service the Cascade Station shopping center, which is anchored by IKEA, Target, and Best Buy. Field observations conducted by Cascade Policy Institute in 2010 and again in 2016 showed that more than 98% of all passenger-trips to and from Cascade Station are made in private automobiles. Light rail is simply irrelevant.

The same is true for Gresham Station, another shopping center specifically built around a light rail stop. Regardless of the time-of-day or day-of-week, virtually all trips to and from Gresham Station are made in private vehicles.

The Green MAX line, which terminates at Clackamas Town Center, has also had no effect on travel patterns at the mall.

In order for the Bridgeport Village line to be built, Tigard residents will need to approve the city’s participation in the project by voting for Measure 34-255 in the November election. Local voters should learn from experience and turn down this measure. Light rail through Tigard would be a total waste of money.

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MAX at 30: Portland Transit Needs a New Plan

September 5 marked the official 30th anniversary of the opening of TriMet’s light rail system. Like many Portland residents, I took a free ride that day and felt that this was a big step forward for transit service.

Unfortunately, actual performance never lived up to the hype. My hopes for “high-speed” transit were dashed when I discovered how many stops there were. The average train speed today is only 18 MPH.

My expectation that MAX would include five or six train cars was also incorrect. There are only two cars per train on MAX, and there will never be more than two cars because Portland has 200-foot blocks in downtown. Longer trains would block busy intersections.

The cost of construction also spiraled out of control. The Orange line to Milwaukie cost $210 million per mile, making it hundreds of times more costly than simple bus improvements.

In short, MAX is a low-speed, low-capacity, high-cost system, when what we really need is just the opposite—a higher-speed, higher-capacity, low-cost system.

Regional leaders should pull the plug on any more rail and start focusing on the future of transit, which will feature driverless vehicles, door-to-door delivery, and private car-sharing services such as Uber Technologies.

The passenger rail era died a hundred years ago. It’s time for Portland to get into the 21st century.

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New Report: Transportation Funding Should Be a State and Local Responsibility

Study Finds That Transportation Funding Should Be a State and Local Responsibility

May 4, 2016 

FOR IMMEDIATE RELEASE

Media Contact:
John A. Charles, Jr.

503-242-0900

john@cascadepolicy.org

PORTLAND, Ore. –  In a study released today by Cascade Policy Institute, economist Randall Pozdena recommends that transportation regulation and finance devolve from the federal government to state and local governments. In addition, the study recommends that most transportation taxes be replaced with targeted user fees, to ensure that those who pay for services receive benefits commensurate with those payments.

For over 30 years, the federal government has assumed a disproportionately large role in the regulation and subsidization of transportation services. Yet, most travel is local. For instance, the Cascade research paper found: 

  • More than 50% of all household trips, by all modes, are less than five miles long
  • More than 90% are less than 20 miles
  • 92% of freight shipments are less than 500 miles, by weight

Despite the dominance of local travel, 32% of all transportation funding flows through federal processes.

Of the various transport modes, private freight, airline travel, and pipeline shipments are the least regulated and least subsidized. These modes benefit from high levels of private ownership and capital investment, subject to normal market discipline.

Highway travel and transit suffer from the most distortions and cross-subsidies through federal intervention. As a result, most urban areas face growing levels of traffic congestion, and large urban transit systems are seriously (and often tragically) under-maintained.

The transit industry, which has steadily become a government-sponsored enterprise since passage of the Urban Mass Transit Act of 1964, is the sector most in need of a new business model. According to Dr. Pozdena,

“By definition, transit trips are extremely short and not important parts of larger networks. Federal and state governments should be out of the transit sector altogether, and rely on fare box revenue to ensure that the cost of the service is worthwhile to the user.”

For comparison purposes, Dr. Pozdena calculates that it costs roughly $60,000 to recruit one new additional transit rider in Oregon, which is 10 times the cost of providing new highway capacity for one additional auto commuter.

The Portland region in particular suffers from a mode imbalance in which vast sums of federal and state dollars have been spent on lightly-used passenger rail lines, while new highways and bridges have been canceled or delayed. This problem can be solved by inviting private investors to build needed new facilities through toll-based payments, and implementing time-of-day pricing schemes to ensure free-flow travel conditions on the regional highway system.

Last week the Oregon legislature announced the formation of an 18-person task force to study transportation funding for the 2017 legislative session. According to John A. Charles, Jr., CEO of Cascade Policy Institute,

“The Oregon Legislature has struggled unsuccessfully for decades to devise a sustainable transportation funding system. As yet another task force prepares to scale the fortress wall with the same weapons used in previous assaults, members should consider a new approach including targeted user fees rather than broad-based taxes, electronic tolling and variable pricing, elimination of political mandates prohibiting new highway facilities, and market-based reforms including privatization.

“These principles work everywhere else in the economy; they would work in the transportation sector as well, if we allowed them.”

The full report, Devolution of Transportation: Reducing Big Government Involvement in Transportation Decision-Making, can be downloaded here.


Founded in 1991, Cascade Policy Institute is Oregon’s premier policy research center. Cascade’s mission is to explore and promote public policy alternatives that foster individual liberty, personal responsibility, and economic opportunity. To that end, the Institute publishes policy studies, provides public speakers, organizes community forums, and sponsors educational programs. Cascade Policy Institute is a tax-exempt educational organization as defined under IRS code 501(c)(3). Cascade neither solicits nor accepts government funding and is supported by individual, foundation, and business contributions. The views expressed in Cascade’s reports are the authors’ own.

 

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TriMet’s Edifice Complex

Recently TriMet announced that after two years of planning for an expensive new “bus rapid transit” line from Gresham to Portland, the new service would actually take 8-11 minutes longer than current buses.

Over in Southwest Portland, TriMet is planning a $2 billion light rail line to Bridgeport Village near Tualatin, a suburban shopping mall.

Agency planners are fascinated with shiny new objects, but most riders don’t benefit. For example, between 2000 and 2015, TriMet opened five new rail lines, but the total vehicle-miles of daily transit service actually dropped by 5%.

It’s time to admit that TriMet’s basic business model is becoming obsolete. The agency is a sluggish monopoly that takes years to bring new service to market, while customers live in a smartphone world where they have millions of choices and same-day delivery.

In particular, the coming era of driverless vehicles will create entirely new businesses that will free riders from the tyranny of fixed-route transit service. Legacy systems such as TriMet will be stuck with a vast network of aging infrastructure that will be too expensive to maintain.

We don’t need another light rail line to Bridgeport, or a bus rapid transit line to Gresham. What we need is new vision of mobility in Portland.

(revised 4/6/16)

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Portland Chases Another Dream

The U.S. Department of Transportation announced this week that Portland is one of seven cities still in the running for a $50 million grant as part of DOT’s “Smart Cities” challenge. Portland is proposing to build “smarter streets” that talk to self-driving cars and to develop an app that will decrease reliance on private automobiles.

This is not a joke, and it’s not another episode of Portlandia. There are actually federal bureaucrats who think that putting sensors in streets to talk with computerized cars is important, and that Portland is capable of running such a system.

Apparently, they are unaware that Portland’s street system is so run down that the city could be the film location for a Mad Max movie.

And given the region’s obsession with 19th century street cars that move more slowly than pedestrians, why would anyone think Portland is capable of being a national leader in 21st century roads?

This is a city that tried to prevent car-sharing companies such as Uber and Lyft from legally operating here last year. No fancy street sensors were required; the necessary smart phones were already in the hands of potential customers. All the City Council needed to do was get out of the way, and even that was too complicated for them.

We should let Google worry about autonomous cars. Portland should stick to something simple, like filling potholes.

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Broken Promises: The Real Trends in TriMet’s Transit Performance (2004-2015)

TriMet’s ridership is declining and its level of fixed-route service is lower today than it was in 2004. According to mainstream transit advocates, the solution is to spend more public money.

The problem is we’ve already tried that, and it’s not working. TriMet has been imposing a regional payroll tax on most employers since 1972. The rate was initially 0.30%, then grew to 0.60% by 1979. During the 2003 legislative session, TriMet sought approval to raise it by another tenth of a percent. According to TriMet General Manager Fred Hansen, “TriMet’s proposed payroll tax increase will be used exclusively to provide new or enhanced transit service. This will include assisting in the operation of Washington County Commuter Rail, Clackamas County light rail, Lake Oswego Streetcar, increasing Frequent Service routes, and enhanced local service connections to these lines.”

The rate increase was approved, and was phased in over a 10-year period, beginning January 2005.

During the 2009 legislative session, TriMet lobbied for another rate increase, phased in over 10 years. The new rate of 0.7337% went into effect on January 1, 2016.

Now that we have more than a decade of experience with payroll tax rate increases, it is informative to compare revenue trends with service trends. The results show that there is no correlation between revenue and service.

 

 

TriMet Financial Resource Trends for Operations

2004-2015

 (000s) 

2004 2006 2008 2010 2012 2014 2015 % change
Passenger fares $55,665 $68,464 $80,818 $93,729 $102,240 $114,618 $116,734 +110%
Tax revenue $155,705 $192,450 $215,133 $208,933 $248,384 $275,357 $292,077 +88%
Total operations $290,513 $342,274 $404,481 $433,609 $488,360 $522,155 $493,572* +70%

 

*Grant revenue in 2015 dropped by $41,876 due to timing of receipt; those funds will appear in TriMet’s 2016 income statement.

 

VIEW TABLE IN PDF HERE

 

In fact, there is negative correlation – as TriMet’s revenue went up over the course of a decade, actual service went down. 

 

Annual Fixed Route Service and Ridership Trends for TriMet

2004-2015 

2004 2006 2008 2010 2012 2014 2015 % change
 
Hours of service 1,698,492 1,653,180 1,712,724 1,682,180 1,561,242 1,608,090 1,676,826 -1.3%
Miles of service 27,548,927 26,830,124 26,448,873 25,781,480 23,625,960 23,763,420 24,248,910 -12%
Originating rides 71,284,800 74,947,200 77,582,400 77,769,119 80,042,810 75,779,560 77,260,430 +8.4

 

Source: TriMet, http://www.trimet.org/pdfs/publications/trimetridership.pdf 

VIEW TABLE IN PDF HERE

 

There is a slight correlation between revenue and transit use, as total originating rides went up 8% while operating revenue went up 70%. However, ridership peaked in 2012 and has dropped by 3.5% since then.

It is also interesting to compare revenue trends with TriMet’s share of commute trips. The Portland Auditor has conducted an annual “community survey” since 1997, and those surveys measure travel choices by Portland residents. The results show that TriMet’s market share of commuting has remained exactly the same since 1997, despite (or because of) massive expenditures on rail transit during that period. 

 

Travel Mode Share for Weekday Commuting

Portland citywide, 1997-2015 

Mode 1997 2000 2004 2008 2010 2012 2013 2014 2015
                   
SOV 71% 69% 72% 65% 62% 61% 64% 63% 60%
Carpool 9% 9% 8% 8% 7% 6% 6% 6% 5%
Transit 12% 14% 13% 15% 12% 12% 10% 11% 12%
Bike 3% 3% 4% 8% 7% 7% 7% 8% 9%
Walk 5% 5% 3% 4% 6% 7% 7% 8% 8%
Other n/a n/a n/a n/a 7% 6% 6% 6% 7%

VIEW TABLE IN PDF HERE

Notwithstanding the obvious drop in service, TriMet claims that the legislative promise was met because new rail lines were opened. But to the 66% of TriMet riders who saw their bus service drop by 12%, shiny new rail lines were of little consolation.

The chief enablers of TriMet’s tax addiction have been Portland-area business associations, including Portland Business Alliance, Westside Economic Alliance, Oregon Business Association, and the Central Eastside Industrial Council. Those groups repeatedly embraced higher taxes for their members on the premise that more transit revenue equaled more transit service. That premise is clearly false.

When the TriMet Board meets to increase the tax rate again in September, Portland business groups should reconsider their automatic support. Unless and until TriMet service levels reach those of 2004, there is no reason to continue “throwing money” at an underperforming monopoly.


John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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Failed Promises: Why the Legislature Should Reject TriMet’s Request for New Spending Authority

TriMet is currently seeking new spending authority in SB 1510 to help finance regional “multi-modal” transportation projects. Legislators should deny this request based on previous experience with TriMet commitments.

To refresh the memory: during the 2003 session, TriMet sought approval to increase the payroll tax rate by one-tenth of a percent. According to TriMet’s then-General Manager,

“TriMet’s proposed payroll tax increase will be used exclusively to provide new or enhanced transit service. This will include assisting in the operation of Washington County Commuter Rail, Clackamas County light rail, Lake Oswego Streetcar, a substantial increase in Frequent Service routes, and enhanced local connections to these lines.”[1]

The rate increase was approved, and was phased in over a 10-year period.

During the 2009 legislative session, TriMet sought an additional rate increase. The legislature again approved the request. The TriMet board approved the first of 10 planned rate increases last September, and the new rate of 0.7337% went into effect on January 1, 2016.

Let’s look at the results. After a decade of tax increases, it’s clear that there is no correlation between increased TriMet revenue and actual levels of service: 

TriMet Financial Resource Trends for Operations, 2004-2015

 (000s)

CLICK HERE TO VIEW TABLE IN PDF 

2004 2006 2008 2010 2012 2014 2015 % change
Passenger fares $55,665 $68,464 $80,818 $93,729 $102,240 $114,618 $116,734 +110%
Tax revenue $155,705 $192,450 $215,133 $208,933 $248,384 $275,357 $292,077 +88%
Total operations $290,513 $342,274 $404,481 $433,609 $488,360 $522,155 $493,572 +70%

 

In fact, there is negative correlation – as TriMet’s revenue went up over the course of a decade, actual service went down: 

Annual Fixed Route Service and Ridership Trends for TriMet

2004-2015

CLICK HERE TO VIEW TABLE IN PDF 

2004 2006 2008 2010 2012 2014 2015 % change
 
Hours of service 1,698,492 1,653,180 1,712,724 1,682,180 1,561,242 1,608,090 1,676,826 -1.3%
Miles of service 27,548,927 26,830,124 26,448,873 25,781,480 23,625,960 23,763,420 24,248,910 -12%
Originating rides 71,284,800 74,947,200 77,582,400 77,769,119 80,042,810 75,779,560 77,260,430 +8.4%

 Note: The term “originating rides” excludes transfers.

Source: TriMet, http://www.trimet.org/pdfs/publications/trimetridership.pdf 

There is a slight correlation between revenue and transit use, as total originating rides went up 8% while operating revenue went up 70%. However, ridership peaked in 2012 and has dropped by 3.5% since then.

TriMet claims that the 2003 promise of “enhanced service” was met because many new rail lines were built. But to the 66% of TriMet riders who travel by bus and saw their service drop by 12%, shiny new rail lines were of little consolation.

TriMet now wants to expand its reach through SB 1510 so as to spend new funds for “multi-modal” projects. We suggest a simple response: unless and until TriMet transit service returns to at least 2004 levels, no additional spending authority should be granted.

[1] Fred Hansen, testimony before the Senate Revenue Committee on SB 549, March 11, 2003, p. 3.


John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization. 

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TriMet’s 7-Year-Old WES Line: Still a Project in Search of a Purpose

February marks the seven-year anniversary of the Westside Express Service (WES), the 14.7-mile commuter rail line that runs from Wilsonville to Beaverton. While the train’s owner, TriMet, has emphasized the steady growth in ridership over time, the truth is that WES has been a failure. Daily boardings are still far below the opening-year forecast, and taxpayers subsidize each rider by nearly $35 per round trip.

Although WES was 15 years in the making, it was always a project in search of a purpose. At various times the train was promoted as: (1) a congestion relief tool for HWY 217; (2) a catalyst for so-called “Transit-Oriented Development;” or (3) a way of providing “another option” for travelers. None of these arguments holds up to scrutiny.

During legislative hearings in Salem, representatives from Washington County claimed that WES would take 5,000 motor vehicles per day off of nearby highways. But WES is not even capable of doing that because it only runs 8 times (each direction) in the morning, and 8 more times in the afternoon. And unlike traditional commuter trains pulling eight or nine passenger cars, WES travels only in one-car or two-car configurations.

During its best hours of performance, the total number of passengers traveling on WES is less than 0.5% the number of motorists traveling on HWY 217/I-5 at those same hours. WES crosses more than 18 east-west arterials four times each hour. On busy commuter routes, such as HW 10 or Scholls Ferry Road, each train crossing delays dozens of vehicles for 40 seconds or more.

Since the train itself typically only carries 50-70 passengers per run, this means that WES actually has made Washington County congestion worse than it was before the train opened.

WES also will not be a catalyst for “transit-oriented development,” because the train stations are a nuisance, not an amenity. The noise associated with train arrivals was always underestimated and has proven to be a significant problem for nearby businesses and residents.

As for the hope that WES would provide “another transit option,” there were already two TriMet bus lines providing over 4,000 boardings per day in parallel routes prior to the opening of WES. Commuter rail simply replaced inexpensive bus service with a massively subsidized train.

Several key statistics summarize the problems with the train:

  • WES was originally projected to cost $65 million and open in 2000. It actually cost $161.2 million and opened in 2009.
  • TriMet projected an average daily ridership of 2,400 weekday boardings in the first year; actual weekday ridership was 1,156. It grew over time to 1,964 in 2014, but dropped to 1,771 last year. Since each rider typically boards twice daily, only about 900 people actually use WES regularly.
  • The WES operating cost/ride in January 2016 was $15.95, roughly five times the cost of bus service.

Ridership and Cost Trends for WES

2009-2015

(in 2015 $)

 

2009 2010 2011 2012 2013 2014 2015 % change
 
Avg. daily boardings 1,156 1,313 1,571 1,700 1,876 1,964 1,771 +53%
Operating cost per ride $27.41 $24.46 $20.43 $18.39 $18.98 $15.85 $18.60 -32%
Cost/train-mile    $54.70 $54.12 $53.30 $53.79 $56.82 $51.12 $55.01 +1%
Cost/train hour $1,180 $1,166 $1,171 $1,180 $1,501 $1,109 $1,203 +2%
Average subsidy/ride $26.18 $23.00 $19.01 $17.64 $17.19 $14.36 $17.10 -35%

 

 


Ridership has certainly improved since 2009, but still remains far below the rosy projections made by TriMet for the opening year of operation. There is little reason to think that ridership will grow significantly, given that the train runs exclusively through four suburban communities with no major job centers within walking distance of train stations.

WES is destined to be a one-hit wonder―an expensive monument to the egos of TriMet leaders and Westside politicians. Taxpayers would be better served if we simply canceled WES, repaid grant funds to the federal government, and moved the few WES customers back to buses.


John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

 

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WES at 7: Still a Financial Train Wreck

February marks the seven-year anniversary of the Westside Express Service (WES), the 15-mile commuter rail line that runs from Wilsonville to Beaverton. While the train’s owner, TriMet, promotes WES as a transit success story, the truth is that commuter rail has been a failure.

WES was originally projected to cost $65 million and open in 2000. It actually cost $161 million and opened in 2009.

TriMet projected an average daily ridership of 2,400 weekday boardings in the first year. Actual daily ridership in 2009 was 1,156, less than half the forecast.

Ridership grew over time and peaked at 1,964 in 2014, but then dropped. For January 2016, daily boardings averaged only 1,735. Since each rider typically boards twice daily, that means fewer than 900 people actually use WES regularly.

The operating cost per ride is $16, most of which is subsidized by taxpayers. This is five times the cost of bus service.

Rail proponents have long dreamed of extending WES to Salem, but taxpayers would be better served if we simply shut the train down. When you’re losing $14 per boarding, you can’t make it up in volume.


John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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New Transportation Funding Bill: Going Nowhere FAST

Last week Congress passed H.R. 22, a five-year transportation funding bill known as Fixing America’s Surface Transportation, or FAST.

Under the terms of FAST, the federal Highway Trust Fund will take in about $208 billion in federal gas taxes, while sending $280 billion back to the states by 2020. The $70 billion deficit will be made up from income taxes.

Essentially, this is the same thing Congress has been doing for decades. Since 1993 we’ve paid a federal gas tax of $18.4 cents/gallon; the money flows to Washington; then it gets sent back to the states after a chunk of it has been diverted into a wasteful transit account.

There is no policy rationale for this circular travel of dollars. Most auto, transit, and truck trips are local. Therefore, the operational money should be collected locally as well.

What Congress should have done is repeal the federal gas tax and shut down the federal transportation agencies.

The FAST Act was an expensive band-aid for a problem that needs a new approach. We have the technology to collect mileage-based user fees from motorists, truck operators, and transit customers. We should use that technology to pay for the roads and transit facilities that consumers are willing to pay for, and stop waiting to be saved by a federal transportation Santa Claus.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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The Futility of Public Hearings

Over the past four years, TriMet and Metro have been planning something called the SW Corridor Project. Metro describes it as a multi-modal project featuring new transit capacity, local street improvements, and enhancements to trails, sidewalks, and bike lanes. The project will begin at Portland State, travel along Barbur Boulevard, and terminate somewhere near Tualatin.

The exact nature of the transit element has never been disclosed; ostensibly, the choice is between light rail and bus-rapid transit. The Project Steering Committee insists that final decisions on the technology, route, terminus, and financial plan are still open for discussion, with some preliminary decisions scheduled for 2016.

Curiously, however, at the November 11 TriMet Board of Directors planning retreat, the Board was informed (at 3:17:05) by project staff that opening day for the project has already been set: September 12, 2025.

How is it that TriMet already knows the exact day that operations will commence, if it doesn’t even know any of the particulars – including a proposed, $250 million tunnel to PCC-Sylvania that would only be built if light rail is chosen?

Apparently, all decisions have actually been made, and future public hearings will be just as fake as the past ones.

All aboard for light rail to Bridgeport Village. Only 3,581 days till the opening ceremony!

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

 

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Is TriMet Better Off Than Greece?

Syndicated financial writer Malcolm Berko recently advised a small investor to stay away from Greek bonds or securities. He wrote, “Greece has morphed into a bureaucratic five-star welfare state; but in reality, Greece is a one-star economy. The pensions and entitlements consume 52 percent of government income.”

Well, TriMet’s most recent audited financial statement was released in September, and last year TriMet’s “income” – money earned from customers buying rides, advertising, or services – totaled $153.4 million. The cost of fringe benefits such as pensions and health insurance equaled $166.8 million, or 109% of income.

But the actual problem at TriMet is far worse, because most of the obligations for pensions and other benefits don’t show up as current-year expenses. They appear in financial statements as accrued liabilities that have to be paid off sometime in the future.

Taking into account all liabilities for fringe benefits, TriMet has $711 million in health care obligations, $18 million in pension liabilities for management, and $159 million in pension costs for the union. This sums to $888 million in actuarial accrued unfunded liabilities, or 579% of operating income.

Greece is an international financial disaster; but compared with TriMet, it’s a model of fiscal restraint.

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Mysteries of Tilikum Crossing

Portland’s newest bridge over the Willamette River, Tilikum Crossing, has a few puzzling design features. Apparently, a barrier down the middle of the bridge means that a stalled light rail train or bus would shut down transportation until it was removed, because no vehicle could go around it.

If the bridge is only open to trains, buses, cyclists, and pedestrians, what useful purpose does the barrier serve? (Other than potential MAX and TriMet bus line rush hour chaos, that is.)

And that’s not all….

Syndicated radio host Lars Larson interviewed Cascade’s John Charles on Monday. Click on the Listen link to hear John reveal his observations from Portland’s South Waterfront during Tilikum Crossing’s opening week.

You might be surprised by what he saw bicyclists doing on SW Moody Avenue.

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Tilikum Crossing: More Punishment for Motorists

The new bridge over the Willamette River, TriMet’s Tilikum Crossing, opened for business on Saturday. With beautiful weather and parties at every stop of the Orange MAX line, a good time was had by the thousands of sightseers.

Unfortunately, now that we’ve returned to gray skies and normal weekday travel, it’s clear that the bridge created both winners and losers. The big winners are light rail passengers and bicyclists. The scenic bikeway has already proven immensely popular with local cyclists, who are crossing at a rate 10 times higher than the rate previously observed on the nearby Ross Island Bridge.

The big losers are motorists. The Tilikum Crossing is closed to autos and trucks. In addition, the new traffic signal at the west end of the bridge creates a major bottleneck on SW Moody Avenue, the busiest road within the district.

At both morning and afternoon peak-periods, Moody Avenue traffic is shut down 60% of the time in order to accommodate light rail, the streetcar, and buses leaving or entering the bridge. This gums up all north-south travel, including most of the same bike riders cruising over from east Portland, who must cross Moody Avenue as they exit the bridge.

Moody Avenue motorists have no choice but to wait through red lights that sometime exceed three minutes; but pedestrians and cyclists are rebelling by the hundreds. After losing patience, they simply cross the rail tracks illegally.

In most normal cities, a new bridge makes everyone better off. But in Portland, a bridge simply becomes one more weapon in the political war on mobility.

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Oregon Leads the Nation in Passenger Rail Subsidies

By John A. Charles, Jr.

In the waning days of the 2015 legislative session, a much publicized group of eight legislators conducted extensive negotiations with the Governor’s office over a “transportation package” that would have raised fuel taxes, created a new transit tax, repealed most of the “low-carbon fuels standard” enacted earlier in the session, and paid for various highway improvement projects. That package failed, leaving many observers with the impression that Oregon is “underinvesting” in transportation.

But not every mode suffered. For the few riders of ODOT’s Portland-Eugene passenger rail line, the bank vault was open. The legislature approved $18 million in subsidies for the 2015-17 biennium, including $10.4 million in scarce General Fund dollars.

While this may not sound like a lot in the big picture, it’s quite generous given the minimal use of this line. For the most recent year, the line generated a mere $180,000 in passenger fares, but racked up operating expenses of $7,875,409. This worked out to an operating subsidy of $65.70/ride.

However, the reality is actually much worse. Upon vigorous questioning by Ways and Means Subcommittee Co-Chair Betsy Johnson, ODOT admitted that the “all-in” subsidy was closer to $120/ride.

Was this embarrassing to rail advocates? Hardly. When the multi-billion ODOT budget was up for its single public hearing, there were 21 witnesses who testified—and 20 of them spoke for the sole purpose of defending the rail subsidy. This author was the only witness to suggest euthanizing passenger rail.

The problem is that two decades ago, Amtrak began off-loading most short-line runs to states. ODOT and its legislative overseers foolishly agreed to accept this responsibility, and taxpayers have spent more than $300 million since 1994 propping up the line. Bureaucrats and single-issue advocates know that once you let the “camel’s nose under the tent,” the rest of the camel will soon follow—and then it will be too late to cut the program.

So even though the ODOT rail administrator was the subject of withering criticism by various members of the Ways and Means subcommittee during budget hearing, in the end he was still standing—and walking away with the full appropriation.

Coincidentally, as the ODOT budget was being considered, the Washington, D.C.-based Brookings Institution released a new paper showing the extent of passenger rail operating subsidies across the nation. In every case, transit districts lost money last year, but the losses were relatively modest on a per-boarding basis. The biggest loser, the Hampton Roads Transit system of Virginia, had subsidies of $6.63 per ride.

For whatever reason, Brookings ignored the Portland-Eugene line, as well as the TriMet commuter rail line running from Beaverton to Wilsonville, which has operating subsidies of roughly $12/ride. Cascade Policy Institute took the Brookings data and created a new chart showing that Oregon was at the top of the leaderboard in the category of “most wasteful transit lines,” and shared this with various legislators. Predictably, it had no effect.

Oregon surface transportation infrastructure continues to deteriorate; but for the privileged few who take the rail line from Eugene to Portland, life is good.


John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization. This article originally appeared in the August 2015 edition of the newsletter, “Oregon Transformation: Ideas for Growth and Change.”

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The Extinction of Public Transit

By Emma Newman

Uber and Lyft have recently gained over 50 percent of the taxi market in Portland. This is especially notable as Portland was initially hostile to ridesharing companies, to the point of filing a lawsuit against Uber late last year. This industry takeover is just one example of how private market innovation has upended government-regulated transit.

At a recent Metro hearing on the SW Corridor project, one of the main arguments for pursuing a costly light rail tunnel requiring the destruction of several homes was that ten years of disruption is worth 100 years of use. But considering the speed at which the transportation industry is changing, is long-term use of public transit infrastructure likely?

Public transit is rarely anyone’s first choice due to inconvenience, time cost, and lack of reliability—problems that personal vehicles rarely face. Overcoming these factors has made ridesharing companies more popular than traditional taxicabs.

The fact that private market solutions will increasingly outcompete public transit is evident not only with companies like Uber and Lyft, but with future technologies as well. Google’s driverless car being used on a wide scale may seem to be far into the future; but if costly transit projects are being justified by decades of potential future use, transit planners need to consider what the future of transit may actually look like.

Emma Newman is a research associate at Cascade Policy Institute, Oregon’s free market think tank. She is a student at George Fox University, where she is studying Economics and Computer Science.

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Press Release: Cascade Policy Institute Urges TriMet to Cancel Proposed Tax Increase

July 23, 2015

FOR IMMEDIATE RELEASE

Media Contact:

John A. Charles, Jr.

503-242-0900

john@cascadepolicy.org

Cascade Policy Institute Urges TriMet to Cancel Proposed Tax Increase

PORTLAND, Ore. – At Wednesday’s TriMet board meeting, Cascade Policy Institute President John A. Charles, Jr. presented a detailed critique of TriMet’s proposed tax increase, and urged the Board to cancel public hearings on the tax proposal set for August and September.

Over the past several months, TriMet has been quietly meeting with business associations and large employers in efforts to gain political support to raise the rate of the regional payroll tax it imposes on most employers within the transit district. The current rate is 0.7237 percent. The proposal is to raise it by 1/10th of a percent, phased in over a ten-year period.

TriMet expects to have the first reading of the proposal on August 12, and a Board vote is scheduled for September 23. If approved, the rate increase will go into effect on January 1, 2016.

In his testimony, Charles pointed out that the last time TriMet increased the tax rate – the period of 2005-2014 – total operating revenues for TriMet increased by 80%, but actual service declined by nearly 14%. This was contrary to promises made by TriMet management in 2003 when the legislature authorized the tax rate increase.

Charles also reiterated that TriMet’s cost of employee benefits is unsustainable, with the cost of benefits equaling 149% of the cost of wages in 2014.

In addition to financial issues, the effectiveness of TriMet service is declining. According to TriMet records, ridership in 2014 was lower than it was in 2007, despite an increase in regional population. TriMet’s market share is also dropping. Portland commuters used transit for 12% of trips in 1997; in 2014, that number had dropped to 11%.

According to Charles, “TriMet thinks that the most recent labor agreement solves its employee compensation problem. It doesn’t. Until the cost of benefits drops below the cost of wages, TriMet has no moral authority to impose higher tax rates on local employers.”

The full critique of TriMet’s proposal can be viewed here.

Cascade Policy Institute is a nonprofit, nonpartisan public policy research and educational organization that focuses on state and local issues in Oregon. Cascade’s mission is to develop and promote public policy alternatives that foster individual liberty, personal responsibility, and economic opportunity.

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Does PCC-Sylvania Need a Light Rail Tunnel?

By Emma Newman

Metro and TriMet are jointly considering an expansion of the light rail system to PCC-Sylvania in SW Portland, by building a tunnel to the campus from Barbur Boulevard. The tunneling would have a significant impact on the surrounding neighborhood, forcing many homeowners to move away while still requiring PCC students to make a long walk to their classes.

Currently, 84 percent of PCC students drive to school, even with the campus being served by both shuttles and busses. If this tunnel plan is chosen, Oregon taxpayers will be saddled with paying half of the two billion dollar cost.

When asked at what point the costs of building new transit outweigh the benefits, a Metro spokesperson responded that “transportation planning is more an art than a science.”

An alternative plan under consideration is a rapid bus line which would also service PCC-Sylvania. While this would be about half the cost and much less inconvenient than digging a rail tunnel, it still would be a response to a need that doesn’t exist.

Despite the low ridership of current transit options, transportation officials continue to follow the mantra of “if you build it they will come,” rather than follow the laws of supply and demand.

Emma Newman is a research associate at Cascade Policy Institute, Oregon’s free market think tank. She is a student at George Fox University, where she is studying Economics and Computer Science.

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Event Video – Aging Roads? New Ideas!

Cascade welcomed transportation expert Adrian Moore, Ph.D., Vice President of Policy for Reason Foundation, at a special event at Multnomah Athletic Club on April 29, 2015. Adrian gave a lively, informative, and interactive presentation on a variety of transportation innovations and road financing options. The discussion ranged from topics such as driverless cars to wireless transponders. If you missed the event, you can watch it here. We hope to see you at Cascade’s next event!

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Time to “Uberize” the Transportation Economy

This week marks the beginning of a 120-day “pilot project” by the City of Portland to allow private car-sharing companies such as Uber and Lyft to legally compete with cab companies. Given the consumer demand for such services, there is little doubt that the Portland experiment will become permanent.

Cab services have long been heavily regulated. Detailed rules governed every facet of operation, including rates, dispatching, and―most importantly―the number of cabs allowed in the city. Although justified as “protecting the public interest,” the system was really designed to protect cab companies from new competition.

This model is now being swept aside by the dual forces of technological innovation and entrepreneurial success. Goodbye taxi cartel, hello freedom.

Unfortunately, the roads that we all use are still run as a government monopoly. As with the old taxi cartel, if state officials decide that no more highways will be built, consumers are stuck with a shortage of service. And in fact, that decision has already been made. The last new highway in the Portland region opened in 1982. There are no plans for a new one.

Ultimately, this model can’t work. As Portland grows, we will need new roads. Encouraging the road-building “Ubers” of the world to provide these services is the next logical step in the growth of the regional transport economy.

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Aging Roads? New Ideas!

Cascade Policy Institute

presents

Aging Roads? New Ideas!

 Adrian Moore

featuring

Adrian Moore, Ph.D.

Vice President of Policy at Reason Foundation

The City of Portland is grappling with ways to pay for the rising costs of maintaining and building roads. The Oregon Department of Transportation is facing a similar problem with the state highway system. Adrian Moore is Vice President of the Reason Foundation and an international expert in transportation finance policy. His presentation will feature the latest innovations in highway, tunnel, bridge and road finance from around the world, with commentary about how these ideas might be applicable to Oregon.

About Adrian Moore:

Moore has testified before Congress and regularly advises federal, state and local officials on policy initiatives.  He is a member of the Transportation Research Board, and in 2006 he was appointed by Congress to serve on the National Surface Transportation Infrastructure Finance Commission.  In 2009 he was appointed by Governor Schwarzenegger to California’s Public Infrastructure Advisory Commission.

Mr. Moore is co-author of the book Curb Rights: A Foundation for Free Enterprise in Urban Transit, published in 1997 by the Brookings Institution Press, which was runner up for the Sir Antony Fisher International Memorial Award, and of Mobility First: A New Vision for Transportation in a Globally Competitive 21st Century published in November 2008.  And he is author of dozens of policy studies and articles.  

Mr. Moore earned a Ph.D. in Economics from the University of California, Irvine. He holds a Master’s in Economics from the University of California, Irvine and a Master’s in History from California State University, Chico.

Dessert buffet

Complimentary coffee, tea, iced tea

No-host bar (cash only) 

$15 advance payment (April 27th) — $20 after April 27th and at the door (if seating available)

***

Cascade Policy Institute is a 501(c)(3) nonprofit organization. Donations are tax deductible and accepted with gratitude.


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TriMet’s Great Disappearing Act

During the 2003 session of the Oregon State Legislature, TriMet sought an increase in the regional payroll tax rate. In public testimony, TriMet General Manager Fred Hansen said, “TriMet’s proposed payroll tax increase will be used exclusively to provide new or enhanced transit service.”

The legislature approved TriMet’s request, and the payroll tax rate went up every January for ten straight years. By the end of 2014, TriMet had received $34.4 million in new payroll tax revenues attributable to rate increases. Yet during that same decade, the miles of transit service offered to patrons actually dropped by 14%, while the hours of service declined by 5%.

Like a magic show, TriMet tried to distract the audience by pointing to grand celebrations for the opening of the WES commuter rail line and the Green MAX line, both of which opened in 2009. But overall service levels were reduced five times in six years, the opposite of what was promised in 2003.

TriMet’s proposed budget for 2015-16 was released last week. It calls for “expanding service through the opening of the Portland-Milwaukie light rail line.” Once again, all the attention will be on new trains, while total service levels will still be far below the levels we had in 2003.

State legislators should be asking TriMet where all the money went. But sadly, no one in Salem cares about results.

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Report Shows Oregon Public Employment Contracts Are a Ticking Time Bomb

PORTLAND, Ore. – Cascade Policy Institute today announced the release of a new report showing that Oregon public employers have more than $2.6 billion in unfunded actuarially accrued liabilities associated with non-pension benefits promised to current and future retirees. These benefits, often referred to as “Other Post-Employment Benefits (OPEB),” typically include health care coverage for retirees, but may include other forms of deferred compensation such as life insurance.

A decade ago, the Governmental Accounting Standards Board (GASB) mandated that public employers begin clearly stating financial obligations for OPEB in their comprehensive annual financial reports. However, employers were not required to set up trust funds to pay for these promises. As a result, the Cascade review of 125 financial reports of state, regional, and local governments shows that most employers have no money set aside and are paying for OPEB obligations out of annual operating revenues. This cannibalizes funds needed for actual services.

The Portland transit agency TriMet has the biggest unfunded OPEB liability, estimated to be $950 million as of January 2014. Other employers with relatively large unfunded liabilities include Lebanon school district, Tillamook County, and the city of Corvallis.

Cascade President and CEO John A. Charles, Jr. said, “Over a period of decades, Oregon public employers have deliberately back-loaded employment contracts so that the cost of generous compensation packages would not become apparent until decades later, when the decision-makers themselves would be long gone. Those time bombs are now exploding, harming public school students, transit riders, and others who rely on public services.”

The Cascade paper is a call to action for the legislature to impose some form of fiscal discipline on public employers by requiring them to make annual contributions to OPEB trust funds. Legislation to accomplish this has been considered in past sessions but never approved.

In commenting on this failure, Charles noted, “Actuaries always state what it would take to amortize OPEB liabilities over a 25-year period; these are referred to as ‘annual required contributions (ARC).’ Unfortunately, most government managers treat the ARC as merely a suggestion. All the Oregon legislature has to do is pass a one-page bill reaffirming that ‘required’ means ‘required.’ How hard can that be?”

The Cascade report, Unfunded OPEB Liabilities for Oregon Public Employers: A $2.6 Billion Time Bomb, can be downloaded here.

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No Wonder Portland Can’t Afford to Maintain Streets

The Portland City Council seems determined to raise taxes to pay for street maintenance. But the City doesn’t have a revenue shortage problem; it has a spending misallocation problem, which continues to grow.

The latest example is a proposal to begin collecting and publicizing energy consumption data from about 1,000 of the largest commercial buildings in the city. This is being proposed as part of the city’s Quixotic attempt to “fight climate change.” Proponents claim soothing words that the regulation would “provide market recognition to those who perform really well” on some arbitrary energy consumption scorecard.

In fact, this is just an effort to shame building owners, managers, and tenants into adjusting their behavior to conform to the political edicts of City Hall. Commercial buildings consuming “too much” energy will receive a Scarlet Letter and be harassed by bureaucrats and activist groups into expensive energy conservation retrofits, many of which will make no financial sense.

The cost of city oversight? At least one full-time employee. This is why city streets are falling apart. Too many bureaucrats are pushing papers for programs that are irrelevant to the core functions of government. The Council should kill this idea before it goes any further.

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Portland’s Streetcar Audit: What Went Wrong?

Last Thursday, auditors released a report questioning the Portland Streetcar’s performance. Ridership counts were inflated by 19%. Several additional metrics, including hourly vehicle operating costs and on-time performance, were either unreported or deemed not suitable for use. What went wrong?

First, too much data wasn’t reported. This includes measures for frequency of service, vehicle failure, and fare survey results. Other useful metrics, such as fare box recovery ratio, were simply incapable of being measured, due to a lack of data collection.

Second, when data existed, much was unreliable. Portland Streetcar uses surveying and self-reporting for many of its metrics, and these methods are prone to high error rates. Automatic passenger counters were recently installed to improve ridership accuracy. However, only six of the seventeen cars were outfitted, decreasing their overall effectiveness.

Finally, oversight was lacking. Performance reports were found to be incomplete with questionable results, an issue frequently overlooked by the Portland Bureau of Transportation. More troubling, the City does not have a systematic approach for using performance information to guide management decisions, leading to several missed opportunities for improvement.

Portland Streetcar has a long way to go before its metrics can be trusted again. While increased governmental supervision might sound enticing, there is a better way forward. Portland Streetcar should follow reproducible research principles and make its raw, unaggregated data easily available. This would allow anyone the ability to challenge their findings and methodology, the ultimate form of public oversight.

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Portland Should Join the “Free World” of Ridesharing

In November, Beaverton, Gresham, Hillsboro, and Tigard, Oregon joined Vancouver, Washington in welcoming ridesharing juggernaut Uber to operate legally in their cities. Conspicuously absent from this list was the region’s largest city, Portland, which became virtually surrounded by the smartphone app transit economy. Then, on the evening of December 5, Uber began operating without permission in Portland, in effect daring the authorities to stop it.*

If Soviet East Berlin couldn’t keep Western freedom out by building its infamous Wall, what chance does Portland have keeping its residents from exercising their freedom to choose ridesharing within arbitrary lines on a map?

Until now, most major cities have granted virtual monopolies to a few taxicab companies on the assumption that government must protect both the livelihoods of drivers and the safety and convenience of passengers within their jurisdictions. Economists will tell you that here, and in virtually every government-regulated industry, “the regulated end up capturing the regulators.” In this case the taxicab companies end up influencing government regulators to protect them from competition at the expense of the public.

Such influence is now ending in many cities, thanks to the rise of mobile applications, but it’s still going strong in Portland. So strong that a recent study of 50 large American cities gave Portland a grade of “F” for Transportation-Friendliness, primarily because it is so hostile to ridesharing.

Ridesharing can mean anything from carpooling with your neighbors to using a mobile app to summon one of many cars in your community whose owners are willing to drive you for money to your destination. Drivers can work as much or as little as they wish, “clocking in” to the app and out of it to fit their own lifestyles.

The new app economy has sprung up over a few short years, thanks to the creativity and productivity unleashed after another American “Berlin Wall” was torn down. The mandated breakup of the government-protected monopoly Bell Telephone System in 1982, and the rise of the Internet a few years later, led to the smartphones we all hold in our hands today. Going from no mobile applications in 2007, some two billion people worldwide now use them to improve their lives.

Mobile apps do virtually anything you can think of, from facilitating your online banking, to investing, to checking your health status…to helping you find quick, reliable transportation through companies such as Uber, Lyft, and a host of others.

Uber requires that drivers pass background checks, carry the proper insurance, own relatively new cars, etc. The beauty of ridesharing apps is that they can let drivers and passengers know something about who they’re riding with through instant feedback on the app. You can see your driver’s name, photo, car, license plate number, and rating by other passengers before ever getting in his or her car. Likewise, the driver can know your name and reputation assigned by your previous Uber drivers. Such feedback encourages everyone to be on their best behavior.

Uber requires that you pay with a previously enrolled credit card. No cash changes hands in the car, which may mean speedier and safer transactions. And, before ordering a ride the app can estimate the cost of your trip (often lower than a taxi) and how many minutes it will be before your car arrives. Note that nothing stops current taxicab companies from doing these same things―except perhaps government regulations.

This isn’t all about Uber. Uber is simply the largest ridesharing company at the moment, having just closed a $1.2 billion investment round that values the company at $40 billion. But if Uber fails to innovate or succumbs to recent bad publicity, it could end up like other also-ran technology firms. No ridesharing company has government-monopoly protection to shield it from your choosing another provider.

Beyond opening up transportation options for the public, ridesharing companies open up income-generating opportunities for car owners. In a truly free economy, we should celebrate the technological innovation that allows people with cars to make money by giving rides to people who want them.

The sharing economy itself stems from the realization that all of us own assets that we may not use all the time, whether it’s a spare bedroom in your home (think Airbnb), or an automobile that sits in your driveway for hours a day.

In city after city, people recognize the benefits of allowing ridesharing companies to operate. Portland Commissioner Steve Novick apparently justifies his decision to wait by saying he wants to find “…a way to adopt a less anachronistic [taxicab] system without destroying people’s livelihoods.” There is a way, Commissioner. Rather than imposing anachronistic regulations on ridesharing companies, remove them from the taxi industry and let everyone earn a living by offering customers more and better service.

Recently, more than 40 Portland business leaders demanded taxi reforms, calling on the City Council to legalize ridesharing. They wrote,

“…We have confidence you will see the laws and regulations that protect the taxi industry here in Portland for what they really are: outdated….They’re making people wonder―how can a taxi industry lobby keep Portland from being counted among the progressive, forward-thinking cities that are providing their residents and visitors with fast, easy, on demand services like Uber and its peers.” 

It’s time for Portland to live up to its hype and let young (and not so young) creatives do what they do best—create services that the rest of us want and need. It’s time to legalize transit freedom and bring Portland out of the Transportation Dark Ages.

* On December 8 the City issued a cease-and-desist order against Uber for 5pm December 11 and asked a Multnomah County judge to stop Uber from operating in Portland. Within less than 24 hours of these developments, Uber’s online petition asking Mayor Hales to let Uber operate in the City gathered more than 10,000 signatures.

Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.

 

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Portland’s “F” Doesn’t Stand for “Transportation Friendly”

R Street Institute, a D.C.-based think tank, released its Ridescore website last week. The site grades 50 large U.S. cities based on taxi, limo, and transportation network friendliness. Portland received an F, making it the second-most transportation-hostile city in the survey. Why did Portland rank so poorly?

For taxis, competition is restricted through the use of a fleet cap, which limits the number of vehicles each cab company can operate. A recent study by the Portland Bureau of Transportation shows demand for taxis far exceeds supply on weekends, a direct symptom of fleet caps which prohibit even one more cab unless consumer demand for that cab can be proven before it is even put on the street.

As for limos, Portland forces customers to wait a minimum of one hour before receiving service. On top of that, fares for limos must be at least 35% more than those for taxis, keeping prices artificially high.

Finally, Portland is so hostile to transportation network companies like Uber, Lyft, and Sidecar that they have not been able to enter the market at all.

Portland is known for having one of the best public transportation systems in the country. Despite this, our misregulated private transportation system is one of the worst. Until this changes, we’ll continue to be stuck in the transportation dark ages.

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Scare Tactics Not Working in Road Tax Debates

The Oregon Department of Transportation (ODOT) recently issued a report describing the deteriorating condition of Oregon highways. The authors estimate that the cumulative cost to the state economy from poor roads will be $94 billion by 2035.

At the same time, the Portland City Council is considering a new local income tax to pay for road maintenance and safety, citing a lack of adequate funding.

While road maintenance is indeed a problem throughout Oregon, the public is unlikely to approve new road taxes. The primary reason is a lack of trust. During the past 15 years, Portland has squandered vast amounts of money on fads like streetcars, light rail, bioswales, and “road diets.” At the state level, ODOT spent nearly two decades and $180 million on a silly bridge-with-light-rail proposal to Vancouver, Washington that is now dead.

These projects were mostly aimed at getting people “out of their cars.” Yet the reality is, regardless of how people travel, more than 99% of all trips take place on a road. So road maintenance needs to be the top priority with existing transportation dollars.

New methods to pay for transportation infrastructure will eventually be needed, but politicians need to re-earn the public’s trust before that can happen.

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Scare Tactics Not Working in Road Tax Debates

The Oregon Department of Transportation (ODOT) recently issued a report describing the deteriorating condition of Oregon highways. The authors estimate that the cumulative cost to the state economy from poor roads will be $94 billion by 2035.

At the same time, the Portland City Council is considering a new local income tax to pay for road maintenance and safety, citing a lack of adequate funding.

While road maintenance is indeed a problem throughout Oregon, the public is unlikely to approve new road taxes. The primary reason is a lack of trust. During the past 15 years, Portland has squandered vast amounts of money on fads like streetcars, light rail, bioswales, and “road diets.” At the state level, ODOT spent nearly two decades and $180 million on a silly bridge-with-light-rail proposal to Vancouver, Washington that is now dead.

These projects were mostly aimed at getting people “out of their cars.” Yet the reality is, regardless of how people travel, more than 99% of all trips take place on a road. So road maintenance needs to be the top priority with existing transportation dollars.

New methods to pay for transportation infrastructure will eventually be needed, but politicians need to re-earn the public’s trust before that can happen.

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No New Street Fee: City Council Should Approve Street Maintenance from the General Fund

Last week Portland City Commissioner Steve Novick suggested that the City Council approve $7 million in General Fund dollars to help pay for street maintenance. The City expects to have a surplus of some $9 million this fall, allowing new discretionary requests from individual bureaus.

Such a transfer would be far preferable to enacting a street tax, which has been widely opposed. Continuing to push the tax would be divisive and a huge waste of time for the hundreds of city residents who would show up to oppose it. Street maintenance is one of the most basic responsibilities for any municipality. Therefore, it is appropriate to use property tax dollars from the General Fund to maintain the road network.

Moreover, the City Council has an abysmal track record of managing dedicated transportation user fees. This was highlighted in a report issued last year by the Portland City Auditor, showing that dedicated transportation revenues had been going up over the last decade, while actual spending on road maintenance had dropped. This conclusion makes any proposed tax increase a non-starter.

The unexpected budget surplus gives the Council a graceful way to put the street tax proposal to bed. They should take the opportunity and move on.

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Forum on the Future of America’s Transportation Infrastructure

Cascade president and CEO John Charles  presented on the demise of the highway trust fund at a Portland town forum on August 4, 2014. The forum, sponsored by Rep. Earl Blumenauer, included a number of presenters that spoke on the the future of America’s transportation infrastructure.

Charles’s presentation can be seen at 1 hour and 14 minute (1:14) mark of the video shown below.

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The Demise of the Highway Trust Fund: A Market Solution

 

In the 1967 film The Graduate, Dustin Hoffman plays a nerdy twenty-something who suffers through an unwanted college graduation party hosted by his parents. As he makes the rounds, a middle-aged business man offers a memorable bit of career advice: “I just have one word for you: plastics.”

 

In the context of today’s forum on the future of the Highway Trust Fund, I also offer one word of advice: Uber.

 

Most of you probably know that the ride-sharing company Uber relies on the use of a smartphone app to connect potential customers with nearby drivers who use their own vehicles to provide door-to-door transit service. The $17 billion company has become so successful that in late June thousands of taxi drivers around the world went on strike to protest this private, unsubsidized challenge to their monopoly franchises.

 

The Oregonian reported recently that Uber had launched in Vancouver, WA, but faces one major barrier: The company’s service is outlawed in Portland. In fact, Portland is the only major city on the entire west coast that does not allow Uber.

 

This issue is symbolic of everything that’s wrong with transportation policy. Municipal taxi regulation is as anachronistic as the price and route control which used to be imposed by the Civil Aeronautics Board (CAB); and the Congressional decision to euthanize the CAB in 1978 enabled the market-based airline revolution that changed flying from a boutique experience for the wealthy to a mass consumption option for the middle class.

 

Transportation insiders are now obsessed by the consistent failure of Congress to come up with a new funding stream for surface transportation programs, but the success of Uber suggests that we’re looking in the wrong places for money. There is a vast amount of investment capital circling the globe, looking for a profitable place to land. That capital can be deployed to the benefit of motorists and transit users if we create real markets in transportation.

 

Apparently, most people in this room have a different perspective; they agree with Congressman Blumenauer that the primary solution is to raise the 18.4 cents/gallon federal gas tax. But if we step back and think about the nature of the problem, there is no reason to have the federal government involved at all. The beneficiaries of every transportation investment are the users, who can pay the full cost through user fees or local taxes. All users are local.

 

Collecting taxes from Ames, Iowa and Camden, New Jersey to finance a road culvert project in Beaverton, OR is a convoluted and wasteful way to pay for service. The only reason we cling to it is because it benefits the politicians and bureaucrats whose power base is tied to the laundering of gas tax money through Washington, D.C. The legislative ability to pork-barrel from one state to another removes all fiscal discipline, and virtually guarantees that vast amounts of money will be wasted on useless toys such as “high-speed rail.”

 

I was asked to defend the concept of “devolution” today, and I’m happy to do so. There are federal agencies that should follow the Civil Aeronautics Board into the bureaucratic burial grounds, including the Federal Highway Administration and the Federal Transit Administration. Neither adds much value, and both distract us from better solutions.

 

However, devolution would only be a small step forward because state and local politicians love to pork-barrel tax money just as much as federal officials do, and they’re very good at it. For instance, in 2013, the Portland Auditor released a report entitled: “Transportation funding: revenue up, street maintenance down.” That’s all you need to know about the contrived road maintenance crisis in Portland.

 

The Metro Auditor has published at least 5 reports since 2008 chastising Metro for wasteful transportation spending. The Metro Council has completely ignored these reports.

 

TriMet has been awash in taxpayer cash over the last decade, yet service has dropped. Between 2004 and 2013, total annual operations revenue at TriMet went up 62%, while annual vehicle miles of transit service went down by 14%.

 

Given that pork-barreling is endemic to government spending, the transportation finance “solution” requires a massive dose of Uber, whereby capital is raised from private investors, innovative services are marketed entirely on the basis of consumer preference, and the profit motive imposes fiscal discipline on spending.

 

What is preventing this from happening in transportation is the mindset of government officials. They want to control the flow of investment dollars, pick all the projects, set all the prices, and determine how and where people travel.

 

In other words, they insist that we regulate surface transportation in the same failed way that the CAB used to set prices and routes for commercial airlines.

 

The Uberization of the transportation economy would involve at least the following elements:

 

  1. Allowing/encouraging bridges and limited access highways to be converted to tollways, with variable pricing in those urban areas where peak-hour traffic congestion is a problem. The gas tax at any level cannot solve urban congestion because traffic varies by day of the week, time of day, location, and direction of travel. Therefore, the appropriate user fee must vary in real time as well in order to modify behavior appropriately.

 

  1. Restricting the use of all highway toll revenues to maintenance and expansion of those tollways. Motorists cannot be used as ATMs for non-road boondoggles.

 

  1. Allowing/encouraging private companies to build new highways and bridges with private equity, financed through electronic tolls, without excessive regulation. The latter point is highly relevant as we consider the possibility of a third bridge over the Columbia River that might be built by a private company and financed entirely with tolls. If that company approached Metro next week seeking help with the environmental permits, everyone in this room knows what the response would be: drop dead.

 

We need a major attitude adjustment among regulators, not just more money.

 

  1. Deregulating the entire transportation market to allow/encourage competition to TriMet, the streetcar, the taxi cartel, PDOT, and ODOT.

 

  1. Devolving all decisions away from the federal government, and converting the existing 18.4 cents/gallon federal gas tax to an add-on state tax (which would bring the state tax rate to 48.4 cents/mile).

 

  1. Creating real markets in transportation infrastructure and returning consumer sovereignty, whereby consumers get all the transportation choices they want – as long as they are willing to pay for them.

 

The decades-old arguments about the federal gas tax versus some other funding mechanism is stale. You can choose to stay in that endless legislative loop, or you can get out of it and look for something else. The success of private companies such as Uber, Lyft, Bolt Bus, and the large consortiums building new tollroads all around the world indicates that there is plenty of money available for the construction, reconstruction, and maintenance of surface transportation facilities under the right conditions. The job of elected officials is to create those conditions and then get out of the way.

 

I predict that within two years, Uber will be legal in Portland, and the local taxi cartel will have morphed into something much more market-driven. We should applaud this change, and look for other opportunities to connect consumers with service providers through the dynamic market process.

 

A version of this essay was presented at a Portland town forum sponsored by Rep. Earl Blumenauer on August 4, 2014.

 

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Time for a Third Bridge to Vancouver

Last week a conceptual plan for a new bridge over the Columbia River was unveiled at a public forum in Vancouver, WA. The plan, presented by Florida-based Figg Engineering, calls for a four-lane bridge east of I-205. The new bridge would have 144 feet of river clearance – the same as the I-205 Bridge — and include sidewalks and bikeways completely protected from highway traffic.

The financing is still to be determined, but could involve user fees, known as tolls. In fact, one option would be for the bridge to be privately owned and operated, paid entirely with tolls. Those drivers unwilling to pay could continue to use the Glenn Jackson Bridge, as they do today.

Oregon political officials are notably cold towards the idea of a third or fourth bridge over the Columbia. Local politicians believe that the two bridges we have now are all we should ever get – even though Portland is served by nearly a dozen bridges over the smaller Willamette River.

As the Portland-Vancouver region grows we will need much more bridge capacity. Since government won’t provide it, we should welcome this opportunity to pursue a private investment option.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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Should Portland Residents Pay Another Fee to Cover Basic Road Maintenance?

Portland Mayor Charlie Hales is proposing a new transportation tax for 2015. He claims this is needed to offset a decline in revenue.

However, the facts show a different story. Total revenue for transportation has been growing for decades. For example, from 1996-2007, Portland transportation revenue grew by 60%. According to the city auditor, that was the largest increase among all city agencies during that period.

Portland’s general fund has also been flush. Between 2003 and 2012, the amount of annual tax revenue the city received from each Portland resident increased from $2,292 to $2,656. Total property taxes grew by 27% during that time.

Despite all this money, the city’s streets are poorly maintained. The problem is that local politicians have preferred to spend vast amounts on frivolous toys like the eastside streetcar and Milwaukie light rail, rather than taking care of basic maintenance. As a result, transportation debt service has increased from 10% of discretionary spending to 20% in just the past four years. The charge card is getting maxed out.

Instead of demanding more tax dollars for shiny new objects, the City Council should maintain and improve the basic road network. If this task is too difficult, taxpayers should ask why we bother to have a city government at all.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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Time to Stop Throwing Money down the WES Sinkhole

In its proposed fiscal year 2015 budget, TriMet forecasts the purchase of two additional vehicles for the Wilsonville-to-Beaverton commuter rail line known as WES. The total cost will be $8.5 million in borrowed funds. None of those costs will be paid by WES riders; $600,000 annually in debt service will be paid by taxpayers for the next 20 years, for a total of $12 million.

This is a critical decision point for the TriMet board. Approving the proposed budget will expand the WES vehicle fleet from four to six and irrevocably commit the agency to commuter rail. But the five-year track record of WES suggests that another decision would be more defensible: shutting the train down completely.

There are at least three reasons to consider this option. First, WES is an energy hog. According to a new report by the Federal Railroad Administration, the average energy consumed by all commuter rail systems in America during 2010 was 2,923 British Thermal Units (BTU) per passenger-mile. WES was close to the bottom: It consumed 5,961 BTU per passenger-mile, more than twice the national average (by comparison the top performer was Stockton, CA: 1,907 BTU/passenger-mile).

Not only is WES inefficient compared with its peer group, it is wasteful compared with other modes of travel. The national average for all transit buses was 4,240 BTU per passenger-mile; for all light-duty cars, the average was 3,364.

In a state where most politicians are obsessed with energy conservation, it is difficult to justify expansion of a publicly subsidized line that is so wasteful.

Second, WES is TriMet’s most expensive fixed-route service, with an average per-ride cost of $12. Thus, even if ridership grows, it will not help TriMet, since the agency loses about $10 on every trip.

To see just how expensive WES is, we can compare it to an express bus route in the same corridor opened last year by the transit operator in Wilsonville, South Metro Area Rapid Transit (SMART). The costs of the bus are only 3% of WES: $1.30 per mile versus $43.74 for WES.

Transit Service from Wilsonville Station to Beaverton Transit Center

Operating cost/mile

Operating cost/hour

TriMet Express Rail

$43.74

$949.84

SMART Express Bus

$   1.30

$   83.17

Finally, WES ridership is tiny. WES now has about 940 daily riders who account for 1,880 average weekday “boardings.” This is still far below the forecast of 2,500 that was made for opening-year service (2009).

I’ve ridden WES at least 100 times in order to catch the express bus to Salem that picks up WES transfers in Wilsonville. For the privileged few on the train, it’s a nice trip. There are usually plenty of empty seats, free internet service, and lots of legroom. Plus, I feel like royalty as we shut down traffic temporarily on more than 20 east-west cross streets along the way. While this results in a net increase in regional congestion, it’s fun for the train riders.

But just because I personally enjoy WES, that doesn’t make it a good public investment. The bus alternative would move just as many riders at less cost and with lower fuel consumption.

Back in the 1990s, Westside politicians and rail boosters fell in love with the concept of a commuter train to Wilsonville. As with all such pork-barrel campaigns, the promises vastly exceeded eventual performance. But current TriMet board members can claim plausible deniability; none of them were on the Board back then, so it wasn’t their fault.

Now they have a chance to clean up the mess. It won’t be fun having to admit that mistakes were made; but if the Board is serious about re-setting TriMet on a path of financial sustainability, there will be many such decisions to be made. A long journey begins with the first step.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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Energy-Efficiency Myths of Commuter Rail

Advocates of rail transit tend to argue that we need trains because they are more energy-efficient than buses or cars. Unfortunately, that’s only true in some cases.

According to a new report by the Federal Railroad Administration, the average energy consumed by all commuter rail systems in America during 2011 was 2,923 British Thermal Units (BTUs) per passenger-mile. But the commuter line operated by TriMet (WES) was close to the bottom: WES consumed 5,961 BTU per passenger-mile, more than twice the national average.

Not only is WES inefficient compared with its peer group, but it is wasteful compared with other modes of travel. The national average for all transit buses was 4,240 BTU per passenger-mile; for all light-duty cars, the average was 3,364.

Based on these numbers, the environment would be better off if WES were terminated and riders simply got in their cars.

Nonetheless, TriMet management is “all-in” on more commuter rail. In its proposed FY 15 budget, the agency plans to purchase two additional rail vehicles at a total cost of $8.5 million. None of those costs will be paid by the privileged few who ride WES; debt service will be paid by taxpayers for the next 20 years.

It’s a cliché but still true: In government, nothing succeeds like failure.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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John Charles Debates Tigard’s Light Rail Ballot Measure

During January’s Tigard Initiative Public Forum, John Charles debated a Tigard City Counselor on the merits of the Tigard ballot measure that would place restraints on the Tigard City Council regarding the Southwest Corridor Plan.

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As TriMet Sinks, Should Portland Suburbs Go Down With the Ship?

Last week Cascade released a report encouraging cities and counties to consider leaving TriMet due to its financial mismanagement.

TriMet has long admitted that its labor costs are unsustainable. In addition, the agency’s addiction to costly rail construction has cannibalized bus service, which has been cut by 14% in the past five years.

Comparison with other local transit districts paints a stark picture. The cost per mile of operation for the TriMet commuter rail line is $43.74. TriMet’s flagship service, light rail, costs $11.96 per mile. Yet, the small city of Sandy runs its own bus service for $2.57 per mile.

TriMet predicts that additional service cuts will be required by 2017 and every year thereafter to balance the budget, which essentially would shut down the agency by 2025. TriMet’s only strategy has been to seek contract concessions from the bargaining unit representing most workers, but this is unlikely to succeed. The ongoing PERS crisis shows that once management agrees to expensive fringe benefits for unionized workers, it’s almost impossible to reduce them later.

TriMet is in a death spiral of its own making. Local jurisdictions might be hoping for the best, but they should plan for the worst. Leaving TriMet is an option that needs to be on the table.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization. 

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$52 Million Retrofit Makes Traffic Worse in Portland’s South Waterfront

A case study released by Cascade Policy Institute shows the $52 million retrofit of Portland’s Southwest Moody Avenue is already increasing local traffic congestion and will be unable to accommodate future road capacity needs in the future.

SW Moody Avenue was raised 14 feet and the overall right-of-way widened to 75 feet. This was to accommodate double-tracking of the Portland streetcar, pedestrian walkways on either side, and a massive two-way bicycle track. The primary purpose was to allow the Portland-Milwaukie light rail line to pass over Moody Avenue at-grade and stop at the OHSU Collaborative Life Sciences Building.

Before-and-after traffic counts conducted by Cascade Policy Institute on Moody Avenue show the percentage of all trips by automobile has increased since the retrofit was completed, despite the generous right-of-way allocated to non-motorized travelers.

According to Cascade President John A. Charles, Jr., “The South Waterfront has long been a Potemkin Village for Portland planners. It…will soon be served by an aerial tram, streetcar, light rail, elevated pedestrian walkway, a monster cycle track, and a 100-foot wide pedestrian greenway. But the actual evidence shows that the district is highly reliant on auto use, and the reliance is growing. Now it’s too late to provide road capacity for future build-out because so much space was allocated to the streetcar and light rail.”

To read the full report on Portland’s Moody Avenue retrofit, visit cascadepolicy.org.

Kathryn Hickok is Publications Director at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Report Makes the Case for Cities and Counties to Leave TriMet

A report released Monday by Cascade Policy Institute recommends that cities and counties within TriMet’s service jurisdiction consider leaving the transit district.

The study shows that TriMet’s ongoing financial crisis is not just a temporary problem, but a permanent one caused by a failed business model. The agency has one of the most expensive union contracts in America, and the managerial obsession with rail transit is cannibalizing bus service. These problems go back decades, and it’s now too late to fix them.

Due to these factors, TriMet will face annual service reductions beginning fiscal year 2017. Those cuts will slowly destroy the agency. State law has long allowed jurisdictions to leave TriMet, and six communities already have: Molalla, Wilsonville, Sandy, Canby, Damascus, and Boring. Four of those cities created their own transit districts. Based on these experiences, the Cascade study recommends that more jurisdictions consider opting out and create their own transit districts.

Cascade Policy Institute’s report shows that the four cities operating their own public transit systems have lower labor costs, lower payroll tax rates, no long-term debt, virtually no unfunded liabilities for retirees, and better service than they previously had under TriMet.

Services under TriMet have continually declined since 2005, yet the TriMet payroll tax is at an all-time high of 0.72 percent.

“With major TriMet service cuts projected for FY 17 and every year thereafter, jurisdictions still paying the TriMet payroll tax should begin investigating options for leaving the district,” says the report.

According to Cascade President John A. Charles, Jr., “When TriMet was formed in 1969, the expectation among supporters was that creating a single public monopoly transit provider would create economies of scale. Unfortunately, what we really created were ‘diseconomies of scale.’ TriMet’s business model is now permanently dysfunctional, and the evidence from opt-out cities is that ‘smaller is better.’ Cities such as Sherwood, Tualatin, Lake Oswego, and West Linn should not wait for the inevitable collapse of TriMet; they should actively begin assessing the prospects for creating their own transit agencies, either as stand-alone districts or in partnership with nearby communities.”

Click here for the PDF version:

Download version

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Report Shows $52 Million Street Project Makes Traffic Worse

case study released today by Cascade Policy Institute shows that the $52 million retrofit to Portland’s Southwest Moody Avenue is already increasing local traffic congestion and will be unable to accommodate future road capacity needs for the South Waterfront district in the future.

During 2011-12 SW Moody Avenue was raised 14 feet and the overall right-of-way (ROW) widened to 75 feet. This was done to accommodate double-tracking of the Portland streetcar, pedestrian walkways on either side, a massive two-way bicycle track, storm water treatment planters, and relocated utilities. The primary purpose of the retrofit was to allow the Portland-Milwaukie light rail line to pass over Moody Avenue at-grade and stop at the OHSU Collaborative Life Sciences Building, currently under construction.

The retrofit reduced lane capacity on Moody for motor vehicles by moving the streetcar directly onto the road (it had previously run on adjacent ROW) and adding a double-track, despite the fact that motor vehicles are the dominant mode of travel in the district. Before-and-after traffic counts conducted by Cascade Policy Institute on Moody Avenue show that the percentage of all trips by automobile has increased since the retrofit was completed, despite the generous ROW allocated to non-motorized travelers.

To make matters worse, in September 2013 the entire road was shut down for three weeks and much of the new work torn up so that the light rail tracks could cross at grade just west of the new Willamette River rail bridge. Since accommodating light rail was the primary purpose of raising Moody in the first place, this additional retrofit simply wasted tax dollars and inconvenienced local travelers. Neither the City of Portland nor TriMet has provided a credible public explanation of why this was done.

According to Cascade President John A. Charles, Jr., “The South Waterfront has long been a Potemkin Village for Portland planners. It’s likely the only neighborhood in the world that will soon be served by an aerial tram, streetcar, light rail, elevated pedestrian walkway, a monster cycle track, and a 100-foot wide pedestrian greenway. But the actual evidence shows that the district is highly reliant on auto use, and the reliance is growing. Now it’s too late to provide road capacity for future build-out because so much space was allocated to the streetcar and light rail.”

Click here to read the report.

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The Check Engine Light Is On

By William Newell

Imagine you’re in a car traveling down I-5 at 60 mph. The car has been modified with solar panels to supplement the car’s gas engine. Suddenly, as you’re driving down the highway, the sun disappears behind the clouds. In order to maintain your current speed, one of two things needs to happen: Another “idling” engine needs to kick in, or the main gas engine needs to “rev” up.

This hypothetical situation is similar to how the electrical grid works. The electric grid, just like the car, needs back-up generators and large high-capacity generators to make up for the times when wind and solar power fail. Often it’s natural gas or coal plants which fill the gaps. These power plants either continually operate without producing electricity as “spinning reserve,” or they operate less efficiently because they are “revved” up and down constantly.

Now, you can probably see the major drawback to subsidizing intermittent energy sources. It is because they rarely create enough sustained electricity to maintain grid stability; and power plants must “spin” or “rev” up and down, meaning little emissions savings are actually achieved.

If our government leaders continue to preach about saving the environment and reducing emissions, they may want to look under the hood to see if their plan will really work.

William Newell is a research associate at Cascade Policy Institute, Oregon’s free market public policy research organization. He is a graduate of Willamette University.

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TriMet Violates Clean Air Act While “Regulators” Stay Silent

In previous decades the Portland region failed to meet national air quality standards for carbon monoxide pollution and was designated a “non-attainment” area under the federal Clean Air Act. As a result, the region was required to develop and implement strategies to reduce carbon monoxide.

One of the strategies is that TriMet must increase transit service by 1% annually for the period 2006-2017, on the premise that more transit service will reduce auto-related carbon monoxide emissions. TriMet’s compliance must be measured on the basis of a 5-year “rolling average” of actual hours of service. The “baseline year” for compliance is 2004 and includes the opening of the Yellow MAX line, which began operating that year. This strategy was specifically devised by TriMet to grandfather in the Yellow line, thus giving the agency the best chance for compliance.

However, even with this advantage, TriMet has not met the obligation to increase service. In fact, TriMet service has been steadily decreasing. This is a potential problem not only for TriMet, but for other local governments. If the Portland region were to be found out of compliance with the Clean Air Act, the federal government could delay or cancel federal dollars for such projects as Milwaukie light rail and the Columbia River Crossing. For regional politicians, this would be a disaster.

In January, the crisis was taken up by one of the obscure committees run by Metro―the Transportation Policy Advisory Committee (TPAC), comprised mostly of local government bureaucrats. TPAC agreed to recommend that compliance be measured on the basis of cumulative average of service hours for the 10-year period 2007-2017. The new “baseline year” would become 2008.

After TPAC, the plan had to be approved by the Oregon Environmental Quality Commission (EQC), the governing board for the state DEQ. The EQC took testimony in August and rubber-stamped the TPAC recommendation in early December.

Last week the issue moved to JPACT, another obscure Metro committee that approves all regional transportation spending. The free pass for TriMet was quickly approved.

The final stop will be the Metro Council, which will approve the change on December 19.

Sadly, none of the four entities approving the recommendation ever seriously considered enforcing the Clean Air Act. The top priority at every level has been to craft an escape hatch so that business as usual can continue. However, even a cursory look at the evidence would have shown that TriMet had no excuses for non-compliance.

For example, Metro/TriMet/DEQ have all claimed that the “abrupt drop” in TriMet service was “caused by the recent deep recession.” However, as shown in Table 1, the drop in TriMet fixed-route service has not been abrupt; both hours of service and miles of service were lower in 2012 than they were in 2004, so this has been a problem for years.

 

Table 1

Annual Fixed Route Service Trends for TriMet

2004-2012

 

FY 04

FY 06

FY 08

FY 10

FY 12

Change

Veh. revenue hours

1,698,492

1,653,180

1,712,724

1,682,180

1,561,242

-8.1%

Veh. revenue miles

27,548,927

26,830,124

26,448,873

25,781,480

23,625,960

-14.2

Moreover, the recession had little to do with the cuts because TriMet’s operating budget has grown by 62% since 2004 (Table 2).

Table 2

TriMet Financial Resources

2004-2013 (000s)

 

 

2004

2006

2008

2011

2012

2013

% change

 

 

 

 

 

 

 

 

Passenger fares

$ 59,487

$ 68,464

$ 80,818

$ 96,889

$ 102,240

$ 112,500

+89%

Payroll tax revenue

$ 168,378

$ 192,450

$ 215,133

$ 226,456

$ 248,384

$ 259,233

+54%

Total operations revenue

$ 315,130

$ 342,274

$ 404,481

$ 410,388

$ 488,360

$ 508,971

+62%

It’s interesting that the pollutant in question here―carbon monoxide―is a serious one that can permanently injure or kill people, and has been explicitly regulated under the Clean Air Act for over 40 years. Yet, local air quality regulators don’t care about TriMet’s non-compliance. Meanwhile, Metro is squandering a vast amount of public money on its co-called “Climate Smart Communities” plan, aimed at decreasing carbon dioxide―a harmless trace element that has never been explicitly regulated by the Clean Air Act.

In fact, the most notable consequence of increased CO2 levels in lab experiments is the faster growth of plants, which is generally thought to be a good thing. But CO2 has been demonized by environmental activists as a cause of “global warming,” so it must be regulated.

The new compliance plan for TriMet subtly changes the goal posts. By moving from a five-year rolling average to a 10-year average, and shifting the baseline year to 2008, TriMet picks a better year to begin measuring (service levels had already dropped by 2008), and gives itself more future years to “forecast” increased service, even if there is no reason to think such service will materialize. TriMet has publicly stated that the cost of employee fringe benefits must be reduced by 50% in order to restore lost service, and everyone who has watched public employee union negotiations knows that such concessions will never be made.

TriMet is a federal clean air scofflaw, but the local “regulators” are all in on the scam. For a region that prides itself as an environmental leader, this is a disgrace.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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TriMet Finally Admits Rail Problems

Last week I wrote about the problems TriMet is having with its constantly failing rail system. On Wednesday, TriMet General Manager Neil McFarlane announced that the agency is hiring an outside firm to review light rail maintenance needs. The contract will cost a maximum of $245,000.

This is an important acknowledgment by TriMet that the vaunted regional rail system is suffering from chronic breakdowns that will require ever-increasing levels of maintenance.

The ownership problems associated with rail transit are well known within the industry. Indeed, four years ago the head of the Federal Transit Administration (FTA), Peter Rogoff, gave a speech on this topic to a room full of transit executives. Mr. Rogoff reminded people that rail systems have significant long-term costs. FTA had recently concluded that there were more than $78 billion in deferred maintenance costs for public transit agencies in the U.S., and three-fourths of those costs were associated with rail systems.

TriMet management is having to face up to this reality. The supposed “operating advantages” of hauling rail cars disappear when the lifecycle costs of rail system ownership are taken into account. Bus transit doesn’t face these problems. The cost of a bus is only one-tenth the cost of a rail car; it can be sent to many locations rather than a few dozen; and the ubiquitous road system is paid for by millions of motorists, not the transit agency. This keeps the maintenance costs of bus transit to a manageable level.

Unfortunately, TriMet is in a financial free-fall, and absorbing substantial costs for depreciation and maintenance of light rail will worsen the fall for a long time to come.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization. 

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The Chronic Failure of Rail Transit

The local transit agency, TriMet, likes to claim that continued expansion of the regional rail system is critical because rail has operational cost savings over buses.

Unfortunately, this assertion overlooks a glaring problem: The rail system breaks down approximately 30% of the time.

I subscribe to a TriMet email system that notifies me every time there are service outages on light rail or the streetcar. During the past 12 months, I received 117 such notices.

The Steel Bridge rail crossing is the source of most problems, and when it goes out, four MAX lines are affected. Thousands of riders are inconvenienced, often for hours. But there are many other reasons for rail malfunctions: cold weather, hot weather, collisions with automobiles, and security problems, to name a few.

In addition, Portland streetcar service was completely shut down in the South Waterfront for three weeks in September, due to construction of the Milwaukie light rail line.

In every case of a rail outage, passengers have to be rescued by buses. The road system is ubiquitous, so buses have many options for traveling from one location to another. When a rail car goes down, everything behind it backs up.

TriMet’s management is obsessed with building more rail, but the backbone of daily service is the ordinary bus.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization. 

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Why Cities and Counties Should Consider Leaving TriMet

Please join us for Cascade’s monthly Policy Picnic led by Cascade President John Charles on Wednesday, November 20th, at noon.

Portland’s regional transit monopoly, TriMet, has reduced service five times in the past four years and forecasts much deeper cuts beginning 2017. The agency has no long-term financial plan to address its unsustainable operating costs. However, there is an escape route for affected jurisdictions: leaving the transit district. Six communities have left TriMet since 1988, and four have established their own districts. All of them provide better service at lower cost than TriMet. In this session, we will discuss TriMet’s financial condition and examine the experience of the four opt-out transit districts.

Admission is free. Please bring your own lunch. Coffee and cookies will be served. Space is limited to sixteen guests on a first come, first served basis, so sign up early.

Sponsored By

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The Trouble with ObamaCare Is…Parking?

By John A. Charles, Jr.

Oregon is scrambling to open its new federally mandated health insurance exchange, dubbed Cover Oregon, on time October 1st.  Since the commodity being marketed is health insurance, one can only imagine the number of things going wrong: price quotes, online application forms, privacy protection, etc.

But when Cover Oregon’s Chief Operating Officer went on a recent multi-state conference call with President Obama to discuss the problems various states were having with their exchanges, she didn’t mention any of those issues. She said the number one problem for her organization was parking.*

When asked by the President to clarify, she said, “We have 150 employees at our Tualatin office, and only 96 parking spaces.” The President had to tell her that even the vast powers of the Oval Office did not extend to solving local parking shortages.

This was a classic Oregon moment. In a conversation about how the state will ration health care―an industry covering roughly one-seventh of the economy―we discover that management can’t even successfully ration parking for their own employees.

ObamaCare is already collapsing under its own weight. Things are likely to get much worse before they get better. 

* The source of this story was testimony by Rocky King, Executive Director of Cover Oregon. He told it on Sept. 16th in testimony to a joint hearing of the interim House and Senate health care committees in Salem. The hearing audio wasn’t posted immediately but it is now online here:
http://www.leg.state.or.us/listn/archive/archive.2013i/HHC-201309161400.ram.

The parking story begins at about 59:35 and ends at about 1:00:35 into the hearing.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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“Field of Dreams” Is No Strategy for TriMet

September 12 will be the 15th anniversary of the opening of Westside MAX. Unlike most transit projects, Westside light rail was deliberately routed through vacant land with the expectation that it would be a catalyst for “Transit-Oriented Development” (TOD). Planners stated, “The success or failure will be determined in large part by what happens around its 20 stations.”

Fifteen years later, the record is disappointing. There have been thousands of housing units built near light rail, but very little retail or office space. In at least two cases, ground-floor retail near light rail was such a flop that it was later ripped out and converted to residential. Most projects have been under-built for parking, causing problems for both residents and neighbors.

Most importantly, light rail did not magically change travel behavior in Washington County. Extensive field monitoring by Cascade shows that for a quarter-mile or half-mile radius around MAX stations, more than 85% of all trips to and from the area during the morning peak period take place in a motor vehicle. Light rail use rarely exceeds 8% of all trips, and the ratio drops even more on weekends.

The “Field of Dreams” strategy was fun for a movie, but it hasn’t worked for transit planning. TriMet should learn from this experience and pull the plug on any more light rail projects.

John A. Charles, Jr. is President and CEO of Cascade Policy Institute, Oregon’s free market public policy research organization.

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Moving Forward from the Columbia River Crossing

By Kevin Sharp

With the recent suspension of the Columbia River Crossing project, people are already asking, “What should replace it?” The answer, at least for right now, is, “Nothing.” While it is frustrating that the government spent $170 million to not build a bridge, the cost of a poorly conceived bridge would be much greater.

Before Portland and Vancouver do anything else, they need to look seriously into the root of the transportation problems facing each city and plan accordingly. They also need to understand that just replacing the I-5 Bridge with a different bridge is not a lasting solution to the traffic problems. A new bridge needs to be a supplement to the existing Columbia River bridges.

To make the project viable, Portland also needs to abandon its inherently political goal of spreading light rail anywhere and everywhere. A simple bridge to ease traffic congestion is all that is necessary; but Portland transportation planners continually insist on expanding the MAX line to Washington―while Washington residents obviously do not want that. Any attempt to send light rail to Vancouver will only waste more time, taxpayer dollars, and resources that could go to more productive and valuable projects. A bridge should connect the cities; it doesn’t need to drive them apart.

Kevin Sharp is a research associate at Cascade Policy Institute, Oregon’s free-market think tank.

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Statement on the Columbia River Crossing Project

For Immediate Release

Media Contact
John A. Charles, Jr., john@cascadepolicy.org
503-459-3727
Sarah Ross Wolf, sarah@cascadepolicy.org
503-242-0900

Statement on the
Columbia River Crossing Project

PORTLAND, Ore. – In light of the decision by the governors of Washington and Oregon to shut down planning for the Columbia River Crossing (CRC) project, John A. Charles, Jr., President and CEO of Cascade Policy Institute, issued the following statement:

“The CRC was never a solution to any transportation problem, and the Washington State Legislature did the right thing by refusing to appropriate more money for it.

“As the two Northwest governors move forward, they should consider the following points:

  • The Interstate Bridge is not in any danger of imminent collapse and should be used for decades to come.
  • Expansion of rail transit between Vancouver and Portland should be taken off the table. Existing express bus service operated by C-TRAN is already providing excellent transit between the two cities.
  • Any new bridge should have a minimum river clearance of 144 feet, which matches the Glenn Jackson Bridge.
  • The governors should consider building at least two new Columbia River bridges in the region, one to the west of I-5 and one to the east of I-205. The reasons are to create redundancy in the case of an earthquake, and to provide better connectivity between the states. By dispersing traffic across four bridges, most congestion problems will disappear, making all classes of bridge users better off and reducing emissions caused by congestion.

“We have ten bridges across the Willamette River in Portland, and each serves an important purpose. There is no policy reason why we should restrict the number of Columbia River crossings to just two.”

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