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Subby
02-04-2016, 10:41 AM
http://dailysignal.com/2016/02/03/dcs-bikesharing-programs-big-losses-show-why-government-shouldnt-fund-bikeshares/

tweet the author: http://twitter.com/MSargent83


The Problems With Publicly Subsidized Bikesharing

Take, for instance, Washington, D.C.’s Capital Bikeshare, which is the largest public bikesharing program in the country. Capital Bikeshare has over 350 stations primarily in D.C., but also in neighboring Maryland and Virginia. It has received multiple federal grants, including a $6.4 million starter grant, as well as continuous funding from local governments.

Capital Bikeshare riders traversed over 6.4 million miles in 2014—a blip compared to the nearly 2 billion passenger-miles traveled on D.C.’s rail and bus transit services. This huge disparity calls into question bikeshare’s value as a real mode of transit versus a desirable amenity.

And what about cost? Within its primary market of D.C., Capital Bikeshare covers only 70 percent of its operating costs, meaning it loses 30 cents on the dollar. While this may be a high ratio for transit services (which is not saying much), D.C.’s Capital Bikeshare lost $1.7 million on 2014 operations.

The bottom line is that D.C. taxpayers must fork over 65 cents every time someone hops on a Bikeshare bike. However, the real costs are actually much greater: Operating costs do not include the capital expenses of the bikes themselves, nor the expensive docks that must be built and connected to the city’s power grid.

rcannon100
02-04-2016, 11:32 AM
Does anyone have solid numbers for the subsidies for
* cars
* buses
* subway
* pedestrians (I mean pedestrians do not pay to use sidewalks)

That transportation is subsidized shocks no one (well I guess except for the heritage foundation). The real question is bang for the buck.

TwoWheelsDC
02-04-2016, 12:01 PM
the expensive docks that must be built and connected to the city’s power grid.

Except the docks are solar powered.

The rest isn't even worth acknowledging, as it's just Heritage Foundation boilerplate drivel. He probably just cut/pasted the word "bikeshare" into a previous article on Planned Parenthood or something.

jrenaut
02-04-2016, 12:24 PM
Every time I get on a bike in DC, I am safer because of Capital Bikeshare. The increase in bikes on the road, due in no small part to CaBi, means I'm less likely to be run over. If he would like to debate the value of my life and those of my family and fellow DC cyclists vs 65 cents, I'd like to cordially invite him to go **** himself.

Tim Kelley
02-04-2016, 12:34 PM
Does anyone have solid numbers for the subsidies for
* cars
* buses
* subway
* pedestrians (I mean pedestrians do not pay to use sidewalks)

That transportation is subsidized shocks no one (well I guess except for the heritage foundation). The real question is bang for the buck.

The ART bus, which is generally regarded as a good bus system will recover about 30% of it's annual expenses through the fare box.

chris_s
02-04-2016, 01:21 PM
The ART bus, which is generally regarded as a good bus system will recover about 30% of it's annual expenses through the fare box.

ART carried 5.76 million passenger miles in 2014 (http://www.novatransit.org/uploads/data/AllNovaData/AllNovaDataFY14.pdf). BikeShare carried 6.4 million according to the article, so Capital BikeShare moved more people-miles than ART.

UnknownCyclist
02-04-2016, 01:44 PM
Perhaps Arlington County can subsidize brown sandals to encourage more walking.

scoot
02-04-2016, 01:53 PM
Every time I get on a bike in DC, I am safer because of Capital Bikeshare. The increase in bikes on the road, due in no small part to CaBi, means I'm less likely to be run over. If he would like to debate the value of my life and those of my family and fellow DC cyclists vs 65 cents, I'd like to cordially invite him to go **** himself.

Perhaps Mr. Sargent should demonstrate his disapproval of transportation subsidies by repaying the government 45 cents (http://greatergreaterwashington.org/post/12208/funding-amtrak-is-more-cost-effective-than-subsidizing-roads/) for every mile that he has driven (https://pbs.twimg.com/profile_images/625830212471648257/MVxBmEVV.png).

Steve O
02-04-2016, 02:36 PM
The ART bus... will recover about 30% of it's annual expenses through the fare box.

Not including capital expenses, which I suspect are higher than bikeshare, too.

DismalScientist
02-04-2016, 02:45 PM
ART bus subsidization doesn't include the value of roads to ART buses. Of course, CaBi subsidization doesn't include the value of roads to CaBi riders. Not breaking road subsidies into fixed versus incremental costs is a further issue. I tend to believe that cross-mode discussion of subsidy levels is non-enlightening.

PotomacCyclist
02-04-2016, 02:53 PM
The accounting for transportation spending is muddled. There are road and bridge costs at the federal level, state level and municipal level. At the federal level, "Highway Trust Fund" spending also includes transit spending. The total is subsidized heavily from non-gas tax revenue, but the breakdown is unclear.

I've read wildly varying reports about the road subsidy at the federal level. One obscure federal report I read indicates that highway users actually paid more into the system, but that doesn't seem right. I've never heard that before, or anything close to it. Even so, that report doesn't cover streets or roads.

At the state level, the amount of road subsidy varies by state. I believe that in Virginia, transportation spending has been delinked from consumer gas taxes. The system was switched over to more reliance on wholesale gas taxes. I didn't follow the story too closely since I never buy gasoline. I remember reading articles that indicated only a minority of Virginia road spending costs would be covered by gas tax revenue but I don't have the sources on hand.

This article from the Tax Foundation (which is considered to have a conservative bias) indicated in 2014 that drivers (road users) only covered 50.4 percent of road costs (construction and maintenance) at the state and local level, nationwide. Part of the "subsidy" came from federal gas tax revenue though. Those drivers paid the federal gas tax revenue as well, but the accounting is garbled. Even so, total gas tax revenue and tolls still do not cover the state/local cost of road spending.

Mass transit is more heavily subsidized, when looking solely at tax/fee revenue versus direct spending. But transit is more efficient at moving large numbers of people in densely-populated areas and it doesn't involve the costs of pollution or death that car driving does.

http://taxfoundation.org/article/gasoline-taxes-and-user-fees-pay-only-half-state-local-road-spending

But such analyses don't include the very significant expenses and subsidies related to free/subsidized parking or parking minimums, or the imbalanced subsidy for drivers compared to transit users. (That imbalance was addressed recently, as transit users now have the same or about the same monthly tax benefit as drivers do.) The analysis doesn't cover other expenses (externalities) either. Single-occupant car driving has massive negative costs not directly accounted for in these studies, although they are examined in other articles and studies. This includes the death rates on roads, primarily caused by drivers. (Most of the fatalities are also drivers.) About 33,000 Americans die each year in traffic collisions and incidents. Most of them involve cars. (I've never seen any stats on how many deaths are caused by cyclists, but the numbers are exceedingly low. Most estimates are in the 5-6 range, nationwide. NYS did a multi-year study. Over 5 years in the entire state, cyclists only caused 2 or 3 deaths total, thus less than one a year across the entire, heavily-populated state.)

I'll let others figure out how to account for the economic toll of all those deaths, but that's a shockingly high number. (It was even higher 40 years ago, before seat belt use was mandated. Thus, when I read about people saying, "we never wore seat belts when I was a kid and no one died," I can only shake my head. If 10,000+ fewer deaths per year, largely because of seat belt use, is the same as "no one died" when people didn't wear seat belts, then I'm missing something.) There are also tens of thousands of serious but non-fatal car injuries, and hundreds of thousands of less serious car-related injuries each year, just in the U.S.

Of course, we've heard about some of the safety issues on Metro and Amtrak, but transit still tends to be far safer per vehicle mile traveled than car driving is. A fatal incident every few years on Metro is terrible. But why isn't it even more terrible that someone dies on the roads every day or two in this area?

Then there is the significant toll of air pollution and related diseases. This is a tough one to nail down because coal burning for electricity generation is also a major contributor to air pollution. But cars are also a major source of that pollution. The cost in the U.S. was estimated at $131 billion in 2011.

https://www.washingtonpost.com/news/energy-environment/wp/2016/01/29/the-staggering-economic-cost-of-air-pollution/

None of that is included in the true cost of car driving, but it absolutely should be.

Then there is the problem of creating systems that almost force people to drive, even for short distances. While this isn't so much the case in many parts of DC and Arlington, it is true for certain areas, and much more the case in many suburbs, here and across the U.S. This leads to sedentary lifestyles, which along with junk food diets, costs the U.S. an estimated $250-300 billion a year in AVOIDABLE health costs (from type 2 diabetes, metabolic syndrome/obesity, early-onset heart disease and so on). In addition, Alzheimer's is now thought to be diabetes type 3, meaning that its onset may be related to sedentary lifestyles and junk food/high sugar diets. That costs another $100-150 billion a year, some of which might be avoidable through more active lifestyles and better diets. None of this is included in the economic/societal cost of driving, but it should be.

Then there is the problem of reliance on oil and petroleum products. This is a harder one to nail down, or as difficult as some of the other calculations. Much of our overseas military spending is related to protecting oil supplies. There are human rights violations and aggressive military actions around the world, but we only tend to get involved in the Middle East, because of oil. Our reliance on petroleum is a national weakness so we do need to keep an eye on major oil-producing areas. But this cost should also be considered as part of the true subsidy of car driving and gasoline consumption. But it isn't. We've spent trillions of dollars on military actions over recent decades (primarily the Iraq War) without improving national security. Some may object to this, but those costs are undeniable and most parties agree that the supposed rationale for the war was deeply flawed. There are always objections to subsidizing research and production of alternative fuel sources, but why? Some military leaders agree that our reliance on petroleum is a huge security vulnerability and that we should be subsidizing alternative fuel production, even if it's "expensive." As noted, there are huge unaccounted-for subsidies of car driving that leave the entire country very vulnerable. While car driving doesn't have to be tied directly to petroleum consumption, currently it is and it will remain so for the foreseeable future.

The 2015 transportation bill covers the next five years, moving the federal level away from the short-term agreements that had been used recently. It includes one-time revenue sources to pay for the overall transportation subsidies. More of the same, but at least there will be better medium-term planning for transportation projects. Subsidy levels appear at levels similar to those currently in place, meaning subsidies for all.

If anyone objects to subsidies for bikeshare, then those objections should also apply to car driving, parking, mass transit, passenger rail and flight. If anyone points to the Bixi bankruptcy as a sign that bikeshare is not sustainable, then they should also point to the frequent bankruptcies in other transportation sectors. Both GM and Chrysler have faced bankruptcy and collapse in the very recent past. The government had to bail out GM with tens of billions of dollars and an eventual $11 billion loss. Chrysler also underwent reorganization in bankruptcy during the Great Recession.

http://www.reuters.com/article/us-autos-gm-treasury-idUSBREA3T0MR20140430

Many car manufacturers have disappeared over the decades. Almost every airline has gone bankrupt over time. Some more than once. All of the three current largest airlines (and their predecessor companies) have gone through bankruptcy in the past 14 years.

http://money.cnn.com/infographic/news/companies/airline-merger/

Passenger railroads disappeared because of a lack of viability, which is why Amtrak was created. Privately-built roads have gone bankrupt. The debt for the privately-built Dulles Greenway had to be restructured. The bottom line is that transportation does not pay for itself through user fees, ever. No transportation mode does. But some transportation modes have very significant negative costs that do not figure into official calculations. Everyone has to live with the harm from those negatives, so we absolutely should be concerned about those costs.

I don't see any of those negatives coming from bikeshare though, aside from minor annoyances among some drivers (some of whom don't seem to mind that so many Americans get killed by texting, speeding, red-light running or drunk drivers). I'm perfectly fine with bikeshare getting subsidies. It doesn't kill, and every other transportation mode is also subsidized. In fact, bikeshare has turned out to be THE safest mode of transportation of them all. (I can't say I was expecting that, but that's what has happened.) Not a single U.S. bikeshare death. The total number of bikeshare trips was 23 million in Aug. 2014. That number has to be in the 25-28 million range by now, and still no reported deaths.

PotomacCyclist
02-04-2016, 03:01 PM
Another article from the Tax Foundation about road spending subsidies in 2013, including the federal subsidy sourced from federal gas tax revenue:

http://taxfoundation.org/blog/road-spending-state-funded-user-taxes-and-fees-including-federal-gas-tax-revenues

The Share of Federal, State & Local Road Spending Covered by User Taxes and User Fees (2010 data):

D.C. 4.8% (not a typo, at least on my part)
Maryland 45.8%
Virginia 47.7%

U.S. average 50.7%

lordofthemark
02-04-2016, 04:04 PM
ART bus subsidization doesn't include the value of roads to ART buses. Of course, CaBi subsidization doesn't include the value of roads to CaBi riders. Not breaking road subsidies into fixed versus incremental costs is a further issue. I tend to believe that cross-mode discussion of subsidy levels is non-enlightening.

I strongly agree. And I say that as someone who once wrote a paper on modal subsidy per passenger (they made me - anyone who called to ask about it, I pointed out that it was not necessarily a good guide to policy) As Dismal states, quite apart from the usual discussion of externalities, the fixed vs incremental cost question is huge. We are not going to stop having a road system. Period. There is only a slightly higher chance that we might not have a transit system.

Incremental benefit cost analysis, though still not easy, remains the best approach.