Greater Greater Washington

Transit


Ignorant editorial, thoughtful analysis juxtaposed in Post

Let's say you have some opinions about what Metro should do, but you actually know almost nothing about Metro's actual policies. You might talk to your friends about it or comment on blogs, but it's unlikely the Washington Post will put your ideas on its Sunday local opinion page.


Photo by extension 504 on Flickr.

Unless, that is, you work for the Reason Foundation. The Post published an op-ed from Reason's Sam Staley, who shows he knows little about Metro by suggesting a policy that's already in place today: peak-of-the-peak fares.

Nobody must have checked with the Post's own transportation writers, like Bob "Dr. Gridlock" Thomson, who know plenty about transportation. Thomson showed his thorough comprehension of the complex issues around transportation with a very thoughtful analysis of the 2030 Group transportation priorities report.

In his op-ed, Staley writes,

Metro must set fares based on consumer demand by applying market-based pricing. Metro is leaving tens of millions of dollars on the rails simply because its fares don't capture the full higher value that riders are willing to pay at premium travel times.
Staley apparently didn't bother to look up Metro's fare structure before writing the piece. Because it already includes almost exactly what he suggests.

Peak of the peak pricing was a part of last year's fare increase, adding a 20¢ surcharge for trips in the busiest 1½ hour in the morning and evening. It's proven fairly unpopular, but revolved around the very ideas Staley is promoting, that people are willing to pay more at peak times (or if they're not, can ride the system earlier or later).

The specific peak-of-the-peak fare could probably use some tweaking to work better. It doesn't really quite match demand, either in terms of time or geography, but it's a close approximation. Many riders, though, would rather just remove the policy entirely, arguing that it's too confusing.

Still, the general concept is a sound one. It does make sense for Metro to capture the value it provides to riders. It's already doing that to a greater extent than almost any other system: according to statistics published in April, Metrorail is recovering 81% of its operating costs just from fares alone. Even when mixing in the lower cost recovery bus system, WMATA has one of the highest farebox recovery ratios in North America.

If it's good policy to have transit make back most of its costs from its users, what about other modes of transportation, like roads? Everything Staley says about Metro makes equal sense for driving. It's busiest at one time of day, to the point of being too crowded. Just as pricing the busiest lines at the busiest times of day has some economic logic to it, so does pricing the busiest roads at their most crowded.

Staley also suggests a "value capture" mechanism for WMATA to keep some of the tax revenue that comes from greater development around Metro stations. That would let the economic growth that transit brings help pay for transit. Again, it's a sound idea, though Staley seems not to understand the dynamics of the DC region in his explanation. Tomorrow, we'll take a look at this in more detail.

There are a lot of people in the Washington region who have very thoughtful and thoroughly informed recommendations about Metro. There are many transit advocates like the Action Committee for Transit, Coalition for Smarter Growth, MetroRiders.Org, Sierra Club Sustainable Metro DC campaign, and many more. There are the people from the Board of Trade, whose opinions I sometimes strongly disagree with but who are never just ignorant.

There's also the transportation team at the Post, led by the very knowledgeable and always thoughtful Bob Thomson and recently made stronger with the addition of Dana Hedgpeth covering Metro. Coming down at the opposite end of the ignorance-knowledge spectrum is Thomson's article today about the terrible 2030 Group report. I was very nervous about what the Post would write about this story, since 2030 employs a high-powered PR firm which promoted the study far and wide.

A few recent Post traffic articles (by other reporters) have unquestioningly bought into whatever spin comes in a press release, like Ashley Halsey III's coverage of a Governors Highway Safety Association report on traffic fatalities which blamed pedestrians or the flawed TTI report that mis-measured traffic congestion.

Thomson, on the other hand, penned a paragon of what a traffic study analysis article should be. He looks at the strengths and weaknesses of the report, and not just by quoting one person in favor and one opposed, but by actually understanding the intricacies of the issue.

Thomson notes that the study looked at "what transportation programs are most needed to ease congestion, [but] this is not how governments and commuters think." Instead, congestion relief is one priority along with "the creation of new travel options, economic development and neighborhood revitalization."

He notes how it's tough to assign credibility to a study which relies on anonymous "experts" and ends up suggesting many of the same projects the authors already were promoting, but also argues that these problems "[don't] mean the ideas are bad or unworthy of discussion."

While giving most of the article's space to explaining specifically what the study advocates, he also cautions about drawing too many conclusions from "experts":

Still, there's a problem with asking transportation professionals for solutions, and it's the same type of problem that was defined by a psychology professor named Abraham Maslow: "I suppose it is tempting, if the only tool you have is a hammer, to treat everything as if it were a nail."

In the case of the transportation engineers, designers and planners, their main solutions are expensive transportation projects. There are many serious obstacles to those solutions, and plenty of alternative ideas coming from outside the ranks of transportation professionals.

Thomson is far less skeptical of an Outer Beltway crossing of the Potomac than I'd like him to be. He writes, "Drivers stuck on the Dulles Toll Road before the Beltway each morning have said they would love to see a new bridge farther west on the Potomac River to draw off traffic."

But this illustrates exactly the problem with this proposal: these drivers he's citing don't actually want the crossing, they just want other people off the road to ease traffic. Building a new road doesn't actually relieve traffic, as even the Wall Street Journal acknowledges. So these commuters Thomson hears from might think they'd benefit from a new crossing, but they really won't.

Every reporter should read Thomson's story as an example of how to thoughtfully analyze, rather than regurgitate, a report that comes out from a group with an agenda and a well-funded PR operation. And every editor should look at Staley's piece as a cautionary tale to beware op-eds on local issues from national organizations with an agenda, a well-funded PR operation, and little actual knowledge of local circumstances.

David Alpert is the Founder and Editor-in-Chief of Greater Greater Washington and Greater Greater Education. He worked as a Product Manager for Google for six years and has lived in the Boston, San Francisco, and New York metro areas in addition to Washington, DC. He loves the area which is, in many ways, greater than those others, and wants to see it become even greater. 

Comments

Add a comment »

Staley's general concept is not sound at all, nor is Peak of the Peak a good idea.

The reason is simple - he's isolated his analysis to only Metro, instead of looking at the entirety of the region's transportation system.

Indeed, there's plenty of research to support the idea that when looking at the entire system, transit should indeed be heavily subsidized at peak times simply because the system has far more capacity than roadways do:

http://www.rff.org/documents/rff-dp-06-21.pdf

http://www.rff.org/documents/RFF-DP-07-38.pdf

Staley got stuck in the modal silo.

by Alex B. on Jun 27, 2011 10:58 am • linkreport

"But this illustrates exactly the problem with this proposal: these drivers he's citing don't actually want the crossing, they just want other people off the road to ease traffic. "

Hm. I thought a standard GGW talking point is everyone in Washington should support Metrorail because, you know, every time we fund metro we get one driver off of 66, which makes traffic easier for everyone else.

by charlie on Jun 27, 2011 11:03 am • linkreport

The idea for peak-of-the-peak fares as a means to make more money is good enough, and it's not a *huge* financial burden for most commuters.

But the idea that commuters are *willing* to pay more to travel at the busiest times is ridiculous. Nobody is willing. They have no choice. People are held hostage by the fact that they need to get to work at a certain time. I can't imagine somebody actually saying, "Sorry Bob, I can't make that 9 a.m. meeting because it's going to cost me another 20 cents."

If it's a matter of paying a little more, I'd gladly pay up for an unlimited pass option. Everyone would still only be making one trip at the morning and afternoon rush hours.

by Chris Coleman on Jun 27, 2011 11:05 am • linkreport

The existence of peak of the peak does not mean that Staley is wrong: maybe the POP fare should be even higher

by SJE on Jun 27, 2011 11:08 am • linkreport

So when we look at bike lanes or sidewalks we shouldn't think of those projects only in terms of "how much they reduce congestion?", but that's the only consideration that should be taken into account when someone proposes a new road? Not, for example, whether the new roads add to the local economy.

Also, does anyone else think its odd that these studies that supposedly show that new roads don't decrease congestion actually only show that an increase in road mileage results in a corresponding increase in miles driven? Is miles driven equal to congestion? Even if a western Potomac crossing increased the number of vehicles on the road, I don't see why that means that the same bottlenecks would be present. The flow of traffic would be changed and, it seems, you could increase the number of cars on the road and reduce congestion at the same time.

by Greg on Jun 27, 2011 11:11 am • linkreport

Peak of peak will never work when somewhere between 40 to 60 percent of people riding at that time aren't paying a dime for their fares.

by charlie on Jun 27, 2011 11:15 am • linkreport

So if we're to use Staley's reasoning, should we impose congestion pricing on car commuters too? Why limit free-market fundamentalism to transit?

by John M on Jun 27, 2011 11:23 am • linkreport

@charlie
Hm. I thought a standard GGW talking point is everyone in Washington should support Metrorail because, you know, every time we fund metro we get one driver off of 66, which makes traffic easier for everyone else.

Last time I checked, Metro goes from the periphery to the core, more or less paralleling I-66. So yeah, it has the potential to reduce traffic on I-66.

The outer beltway goes along the periphery, so how exactly are people going along I-66 to the core going to want to use it?

There's no contradiction between the part you quoted and the position people have described before on this website.

by MLD on Jun 27, 2011 11:26 am • linkreport

@Greg:

"Even if a western Potomac crossing increased the number of vehicles on the road, I don't see why that means that the same bottlenecks would be present. The flow of traffic would be changed and, it seems, you could increase the number of cars on the road and reduce congestion at the same time."

Let's think about it this way: Say we remove all bottlenecks on I-66. How would that affect the marginal commuter, one who's thinking about hopping on I-66 vs. transit or another route? She's now more likely to drive on I-66. This induced demand increases traffic on I-66 until we reach an equilibrium level of congestion, which looks remarkably like the level of congestion before we removed all of those "bottlenecks." Except that now, there are even more cars sitting in that congestion.

This is why building roads--or, for that matter, building transit lines--tends not to reduce congestion in the long run. This is why we have to think about transportation network goals in terms of improving accessibility, not mobility.

by Gray on Jun 27, 2011 11:27 am • linkreport

Nice roundabout ad hominem attack there David. Mention "libertarian" and falsely accuse the author of ignorance regarding peak pricing.

The author suggested market pricing for metro fares, which as anyone should know is different than the published fare table, peak of the peak not withstanding.

by TGEoA on Jun 27, 2011 11:35 am • linkreport

Well, TGEoA, that's not exactly what Staley said. He invited criticism because he wrote this:

"If customers paid more to travel at peak times, for example, Metro could afford to provide more trains to meet rush-hour demand so that customers weren’t standing on platforms and missing trains that were too crowded to enter. This standard is similar to the rule of thumb in traffic management where cars shouldn’t have to sit through more than one cycle of a traffic light."

Two problems with that paragraph:

(1) It's not some hypothetical "if." Metrorail customers already do pay more to travel at peak times. We can argue about whether the premium should be larger or smaller, but contrary to the impression Staley gives, this is actually already happening. We could also make it more complicated, but again: the concrete example he gives is something that's already happening.

(2) Any reasonable peak or peak-of-peak premium is not going to be enough to solve the capacity constraints that keep WMATA from running more peak trains. Acting like it could only further encourages those who actually understand the constraints of the system to argue that Staley doesn't really know what he's talking about.

by Gray on Jun 27, 2011 11:53 am • linkreport

Peak of peak will never work when somewhere between 40 to 60 percent of people riding at that time aren't paying a dime for their fares.

That is exactly why POP pricing worked. You have to remember that the primary purpose of POP pricing was to raise more money for Metro to avoid service cuts. Since federal workers with their subsidies are price insensitive, POP has worked brilliantly to raise more money while still running trains at full capacity.

So if we're to use Staley's reasoning, should we impose congestion pricing on car commuters too?

That's exactly what Staley implied by citing California's toll roads as an example for Metro to emulate.

Peak of the peak pricing was a part of last year's fare increase, adding a 20¢ surcharge for trips in the busiest 1½ hour in the morning and evening. It's proven fairly unpopular,

Well, of course, POP pricing is unpopular just like any fare increase or service cut would be unpopular. The fairer comparison would be asking people whether they would rather raise all fares a little or institute POP pricing. That's pretty much what Metro did last year in their public input process and people chose POP.

Staley also suggests a "value capture" mechanism for WMATA to keep some of the tax revenue that comes from greater development around Metro stations.

I'm interested to see tomorrow's analysis of this idea which I think is a good one. Special tax districts have successfully built (or will build) the New York Ave and Potomac Yard metro stations and you could consider the Silver Line financed similarly since it's majority financed by increased DTR tolls. Seems like the idea is working.

by Falls Church on Jun 27, 2011 11:58 am • linkreport

@Gray

The key word Staley used is "market" pricing. Peak of the peak isn't market pricing, rather just a third tier added to the fare table.

by TGEoA on Jun 27, 2011 11:59 am • linkreport

@TGEoA

I get that he uses the term "market-based pricing," but then as I wrote above, the example he gives is exactly what we have already. He then continues:

"While a near real-time pricing system might be theoretically preferable, it would be more practical to adjust fares based on the hour or route traveled."

Once again, this is already done. Maybe he has a more complicated system in mind, but he doesn't share what that is--and he even explicitly rejects fully varying market pricing. In the end, this suggestion is fully consistent with what is currently in place.

by Gray on Jun 27, 2011 12:07 pm • linkreport

There's a lot to like in Staley's article but his solutions are often lacking. For example, he says:

Metro must set fares based on consumer demand by applying market-based pricing. Metro is leaving tens of millions of dollars on the rails simply because its fares don't capture the full higher value that riders are willing to pay at premium travel times.

I strongly agree with this sentiment! However John M nailed the perfect response:

So if we're to use Staley's reasoning, should we impose congestion pricing on car commuters too? Why limit free-market fundamentalism to transit?

Yes! But we don't do that! So the second best solution is...moderately higher fares during peak times! Peak of peak sucks, but it's an acceptable solution.

Staley says:

While a near real-time pricing system might be theoretically preferable, it would be more practical to adjust fares based on the hour or route traveled. This is the strategy used by Southern California’s pioneering toll roads that guarantees 65 mph speeds 24 hours a day. The key is to set fare levels to ensure reliable and high-level service.

Excellent! Sounds like his endorsing toll roads. I like that.

He mentions special taxing districts to capture the increase in land values. Great idea, but too administratively complex. Why don't we dedicate a sales tax to WMATA instead?

Chris Coleman writes:

But the idea that commuters are *willing* to pay more to travel at the busiest times is ridiculous. Nobody is willing.

This is using a different meaning of the term "willing." Obviously, no one likes paying more. But they clearly are willing to do it. Willing means "disposed or consenting." We aren't happy about paying more, but we do.

Of course, Staley starts the whole piece off by blaming WMATA for the Dulles project overruns. WMATA isn't responsible for that, the Airports Authority (MWAA) is. It's immensely misleading to portray MWAA's cost overruns as a fundamental need for WMATA reform. The case for WMATA reform is strong enough without it having to absorb MWAA's problems.

by WRD on Jun 27, 2011 12:12 pm • linkreport

Metro must set fares based on consumer demand by applying market-based pricing

While Stanley doesn't propose a mechanism for implementation, it doesnt negate the fact that metro has fixed published fares and peak of the peak has done nothing to reduce congestion. As Charlie points out it has only pulled in more money for Metro from people that aren't paying for it in the first place.

by TGEoA on Jun 27, 2011 12:25 pm • linkreport

@TGEoA

I still don't see your point. He does propose a method for implementation, which happens to look exactly like what is already done. He rejects one more complicated possibility, and then moves on. At no point does he either suggest a method which differs from the current system or demonstrate that he's even aware that this is currently done.

by Gray on Jun 27, 2011 12:32 pm • linkreport

@TGEoA

Your version (and probably Stanley's) of "market-based pricing" probably looks something like this:

Remove all government subsidies and then charge whatever Metro needs to/reduce service in order to break even.

Reality check: government is part of the market. We have collectively decided to fund Metro for various reasons because it has various public benefits. Metro charges fares to its customers that cover 60+% of the cost of their trips. During peak times, they charge more as that service is more valuable to their customers. During peak-of-the-peak, they charge even more as that service is even more congested and valuable.

That sounds pretty market-based to me. You make it sound as if transit agencies haven't raised fares from the 25 cents they were decades ago, and they just demand more and more subsidies from the public dole. This is untrue.

by MLD on Jun 27, 2011 12:43 pm • linkreport

"Market-based pricing" = the market determines the price.

Hmmm: a train pulls in at 8:30 and an auctioneer sells tickets for the seats. The price must start out high because the number of seats are limited, so that means "reverse bidding." Assume the price starts at $10/seat, and there are a few sold, then the auctioneer lowers the price to $9.50 and sells a few more, etc., until all the seats are sold.

Market-based pricing, that'll work.

by goldfish on Jun 27, 2011 12:50 pm • linkreport

@Alex B-

Subsidizing transit heavily during rush hour makes sense if (1) we're not pricing roads properly, (2) a lower price for transit gets people to take transit instead of driving, and (3) the transit system isn't heavily congested. If any one of those three things isn't true, then you want to raise the rush hour price.

(1) is clearly true now, though I'd love to change that.
(2) is less clear, though probably true.
(3) isn't true anymore. Metro is congested at rush hour, and is getting more and more congested. So lower rush-hour fares would just move people off of one congested and underpriced mode (cars) to another congested and underpriced mode (Metro).

by Rob on Jun 27, 2011 12:56 pm • linkreport

It's very hard to read that article and not conclude that Staley's familiarity with WMATA is incredibly superficial. Do instance, TGEoA defends Staley by saying that peak of peak hasn't reduced congestion due to federal employees having extreme price elasticity. Ok, so then how does that help Staley's argument? It just shows that he doesn't understand the supply demand dynamics of Metro. It's not enough to simply sat that there needs to be "market price" and then shrug your shoulders as to what that actually means and why it's not particularly applicable to a market full of price-insensitive users. And it's definitely flawed to imagine that supply can just be easily ramped up to meet the peak demand. It's complicated and a string of Libertarian talking points can't change that.

Even if you grant him the curtesy of ignoring the superficiality of his knowledge of Metro, his proposal for a more flexible pricing scheme is flawed. He suggests that a fully variable price would be ideal. But why is that so? His example of the highway is not transferable. The California roads work by setting aside some lanes. Drivers are presented with a decision: stay in your lane in traffic, or pay whatever the offered price is to gaurantee a fast ride. That's not possible with Metro. People have to decide well before they enter the station whether they want to "pay the price" to ride Metro. Even if you have the price posted outside the station, people have already invested themselves in taking Metro by walking or taking a bus to the station. There's likely no other choice for most riders once they get to the station. That's why we need published and fixed prices and why constantly variable pricing is not just impractical, it's pointless.

by TM on Jun 27, 2011 12:58 pm • linkreport

Damn autocorrect. Please grant me the "curtesy" to ignore my typos.

by TM on Jun 27, 2011 1:01 pm • linkreport

Most of GGW just wants the price of Metro to go up and up, it seems. When most subway systems are about $2 a ride, Metro can be anywhere from $1.50 to around 5 or 6 bucks.

Charge us MORE! One day, we will reach the Utopian dream of public transportation being something other than travel for poor people and commuters who have cars to drive on weekends(outside of their twice daily jaunts into the system).

What is funny is that this eventually prices out the poor people or shifts them to buses. Maybe that IS the point. Gentrify the rails further, and make them safer for the upper middle class.

Gosh, I hope they revoke those student passes, so those punks have to pay five bucks to participate in a group mugging at L'Enfant or Chinatown.

Oh wait, Metro will never spend this increased revenue on anything but awesome customer service agents and sleepy escalator techs....

by ed on Jun 27, 2011 1:03 pm • linkreport

Don't forget that a secondary goal of PotP is to shift peak riders to off-peak riders, where trains are less full, and service is cheaper to operate.

Because the Federal Government is notoriously conservative about its work schedules, this hasn't really worked. You've also got to warn that higher PotP fares could just force people into cars, instead of earlier trains. (Although I'd argue that carpools are still a good alternative, and an efficient use of resources/infrastructure)

Those peak trips are indeed more expensive for Metro to operate, because there are a handful of Red Line trains and train operators who make a total of 4 round trips a day -- two in the morning, two in the evening; and sit unused the rest of the time.

However, those railcars and salaried drivers incur many of the same costs, whether they're moving or sitting still in the railyards. As a percentage of the total budget, power and wear/tear costs are actually pretty low.

Adding off-peak riders is pretty much a slam dunk for Metro, because they've already got the drivers/trains on call, and it usually frees up some peak capacity.

by andrew on Jun 27, 2011 1:07 pm • linkreport

"Because the Federal Government is notoriously conservative about its work schedules, this hasn't really worked." The federal government supports flexible work schedules, which was designed to reduce congestion. They've been doing this for 2 or 3 decades.

The off-peak fares are simply not practical for most riders given the competing demands of family (e.g., schools, childcare, soccer games, etc.) which affect a large proportion of commuters. Work demands like regularized meetings also present barriers. the trouble with "market" solutions is that markets are easily distorted--sometimes by monopolies, sometimes by the lack of information transparency (the lack of info on how much we subsidize roads, for example), and the interdependent nature of markets--the market for transportation is not somehow isolated from other demands on people's resources.

by Rich on Jun 27, 2011 1:35 pm • linkreport

@TGEoA "Nice roundabout ad hominem attack there David. Mention "libertarian" and falsely accuse the author of ignorance regarding peak pricing.
The author suggested market pricing for metro fares, which as anyone should know is different than the published fare table, peak of the peak not withstanding.

While I agree with you that David's commentary turns out to be misguided because he is basing it on a misreading of what the author said, I think you should give David the benefit of the doubt that this wasn't a purposeful 'roundabout ad hominem attack'.

I've had people well versed in zoning issues tell me off line that much of David's commentary on GGW and at hearings vis-a-vis zoning is misguided because it is based on a misunderstanding of the zoning law and on what has transpired to arrive at the current comprehensive plan and zoning regs.

by Lamce on Jun 27, 2011 2:21 pm • linkreport

I'd agree with Rob that congestion is indicative that the price is too low - same as for roads and parking. So let's raise prices where congestion is an issue. This should raise a little money while moving people off Metro during these times. We can then prevent more of them from driving by lowering the price just off peak - so as to make the fare increase revenue neutral.

Or perhaps we could use the added revenue to make late-night trains totally free. Opening the fare gates would also make it slightly faster - and perhaps they could do without station managers, thus saving more money?

Anyway, it doesn't make any sense to run over-crowded trains at one part of the day and mostly empty ones at other parts of the day so change the pricing to bring them both into the goldilocks zone.

by David C on Jun 27, 2011 2:21 pm • linkreport

the trouble with "market" solutions is that markets are easily distorted

I disagree. The demand curve for Metro rides appears to be inelastic.

This isn't a "distortion" at all. What it's saying is Metro riders really like being able to not get fired for being late every day. Riders are willing to pay for that. Metro, by increasing price, is able to capture some of the benefits from the preference of its riders.

The same problem occurs with gasoline. Increasing the tax on gasoline is very painful because we're all pretty much stuck with paying it. Likewise, it's very painful when gasoline prices increase because demand for gasoline isn't as responsive to price as some other goods are.

(Just like we're stuck paying a peak-of-peak fare increases)

This isn't a bug of the market, but a feature. Prices are telling riders to go in early or late. Just as high gasoline prices are telling drivers to drive less.

Over time, drivers switch to more efficient cars, restoring some elasticity to the gasoline demand curve. Likewise, Metro riders will begin to demand different work hours (and/or employers will volunteer to provide better hours). Or maybe it will be better transportation benefits. This will help lessen the impact of the fare increases, but it takes time for this to happen.

I'd also like to note Federal Government workers probably have more flexible work schedules than most private sector workers with benefits like flextime and telework (no time to source this now, however).

by WRD on Jun 27, 2011 2:38 pm • linkreport

@Rob

Subsidizing transit heavily during rush hour makes sense if (1) we're not pricing roads properly, (2) a lower price for transit gets people to take transit instead of driving, and (3) the transit system isn't heavily congested. If any one of those three things isn't true, then you want to raise the rush hour price.

(1) is clearly true now, though I'd love to change that.
(2) is less clear, though probably true.
(3) isn't true anymore. Metro is congested at rush hour, and is getting more and more congested. So lower rush-hour fares would just move people off of one congested and underpriced mode (cars) to another congested and underpriced mode (Metro).

Well, I don't think those research papers I posted were policy proposals, but rather analysis.

The point is, however, that even with a congested Metro system, encouraging more riders on that system still has fewer negative externalities to the population at large (congestion, pollution, traffic deaths, etc) even if it's a less than ideal situation.

The other takeaway is about relative cost - subsidy is somewhat relative. The larger point is that we should encourage people to use the higher capacity travel mode, i.e. Metro.

Yes, Metro is congested at key points at the peak hour - but it still can handle that congestion better than other modes of travel, and to the extent that discouraging peak riders via PotP fares shifts them to drive instead of ride, we've moved backwards as a whole.

by Alex B. on Jun 27, 2011 2:42 pm • linkreport

to the extent that discouraging peak riders via PotP fares shifts them to drive instead of ride, we've moved backwards as a whole.

If so, then yes. But I think you can structure the fares so that you get more people to ride transit without spending more money. Right now your shifting people to driving because Metro is overfull.

I believe the following two statements are true:

1. There is some ideal pricing structure that will end up with the maximum number of riders for the current Metro subsidy.
2. It isn't the one we have.

Whether we can figure out and implement a structure that gets us closer to the ideal isn't clear, but I think we should at least consider ways to get there.

by David C on Jun 27, 2011 2:47 pm • linkreport

the trouble with "market" solutions is that markets are easily distorted

I disagree. The demand curve for Metro rides appears to be inelastic.

You're really just proving my point. The people who argue for market solutions are oblivious to all of the ways that market assumptions (transparency of information, equal access to markets, etc.) are routinely violated. The violations often are willful and carried out by the people who bankroll libertarian position paper mills.

by Rich on Jun 27, 2011 2:51 pm • linkreport

It's adorable that you think WaPo's editorial board thinks things like factual accuracy or a command of the subject matter being discussed are in any way important. As a proof-by-contradiction I offer up near every damned thing they've run in the last five years.

by Don on Jun 27, 2011 5:40 pm • linkreport

The peak-of-the-peak fare is not designed to "... shift peak riders to off-peak riders,". There was a survey 1-2 months ago that showed most of commuters didnt change their behavior with the higher rate, reason is simple, most people still have to get in at work at a certain time and/or dont have a comparable means of transportation so there can not be that much "shift" there. On top of that, why is PoP charged at 8am on almost empty trains? Orange line towards Vienna is 10% used in the mornings, yet we are still charged PotP. I suspect is the same for any train leaving DC in the mornings.

So, no elasticity and charges for below capacity....let's call it what it is, a tax or surcharge to increase WMATA revenues. And as a regular user I'm fine with having such a tax. But then it should be charged to ALL users at all times (like a fuel surcharge) and not ONLY to the suckers (like me) that have to get to work by 8:30am, dont have any flexibility on the time and dont have any other means of transportation.

by RE on Jun 28, 2011 9:27 am • linkreport

RE: Good points. WMATA analyzed other PoP options that get around some of the problems you cited, but the Board ultimately went with simpler over fairer. We analyzed some even fairer options.

by David Alpert on Jun 28, 2011 9:34 am • linkreport

If you have to be at work by 8:30am and don't have any flexibility on time and don't have any other means, then it sounds like Metro is a bargain for you.

The market is not fair. Look at the way airline tickets are sold. You don't pay what something costs the provider, you pay what it's worth to you. So pricing isn't going to be "fair" in the sense that everyone will pay the same amount. It will be fair in that everyone will know the price and can decide if it works for them or not.

Like I said, it sounds like Metro is a bargain for you(And, I should point out that your trip is still subsidized) so why do you care if others are paying less? It reminds me of the Bible story about the people who work in the vineyard for different lengths of the day and get paid the same. Then the early morning workers complain that it isn't fair. There is nothing unfair about different people getting different deals if you agree to the deal you're offered. Inequitable? yes. Unfair? No.

by David C on Jun 28, 2011 9:39 am • linkreport

@David Alpert

I don't think RE is talking about better ways of administering PotP - I think RE is saying that PotP should be scrapped in general and that revenue that WMATA is looking for should be raised via a simple, across the board fare increase.

It's true, the board went with the simplest PotP option - but I think the point is that a straight (and smaller, due to the broad base) fare increase is even simpler yet.

As it is, the congestion pricing element of PotP has failed to generate any useful results. It's a fare hike designed to generate revenue and nothing more - let's call it what it is.

by Alex B. on Jun 28, 2011 10:18 am • linkreport

Really? It didn't shift anyone? I find that impossible to believe. Surely someone changed their commute patterns.

by David C on Jun 28, 2011 10:28 am • linkreport

Sure, a very small minority did - but not enough to actually relieve congestion on the congested parts of the system.

That's the whole point of why PotP failed - the way it was designed, it was never going to work at reducing congestion at peak times. It's not like WMATA's data on this is shocking - it was an utterly predictable outcome.

The benefit of PotP is that it provided WMATA a way to raise fare revenue without looking like they had increased fares.

http://www.wmata.com/about_metro/board_of_directors/board_docs/041411_4AReviewofFY2011FareChanges.pdf

From WMATA:

Metrorail
Rail ridership is marginally lower than the same period last year
Ridership is relatively less responsive to fare changes than expected
The Peak-of-the-Peak (POP) surcharge resulted in no significant shift of ridership to other periods
Farecard surcharge resulted in passengers switching to SmarTrip®

The larger question is this - even if some people did shift, but not enough to actually improve space, then what have you gained?

Think of it in performance parking terms - if you increase the rates but that still doesn't get you to the Shoupian 85% occupancy level, then you haven't yet seen any benefit from that increase.

I'd posit that we haven't seen that benefit because PotP was never structured to deliver it - it doesn't apply to the right station geographies, it doesn't apply at the right times, it adds to the overall complexity of the fare system, and it doesn't take into account the overall transportation system costs.

by Alex B. on Jun 28, 2011 10:45 am • linkreport

Alex is quite right. Call PoP what it is -- a hidden increase.

When looking at usage, remember short term vs. long terms. Short term I clearly say some line as people would wait until the end of pop to board. I did that in Rockville the other day -- and was the only one. So short term you might see change, but long term you just deal with it.

Performance Parking is the same scam. Raise rates, just call it something fancy to distract people.

by charlie on Jun 28, 2011 10:49 am • linkreport

There were 2 motivations at work. PoP as implemented met one, not the other.

1) To encourage people to ride at less busy times. Not successful.

2) To get a large enough fare increase to avoid service cuts, but to minimize the loss of ridership and potential "death spiral."

That was successful. By picking the busiest time when other alternatives aren't appealing either, and a time when a large proportion of riders get their transit subsidized by their employer, Metro was able to capture more of the benefit of its service (to use Staley's terms) without losing many riders.

So PoP accomplished the purpose WMATA staff were really thinking about. It might have been able to do some of #1 as well, which is what advocates were looking for, but the finance staff weren't focused on. Or maybe it couldn't have anyway.

by David Alpert on Jun 28, 2011 10:52 am • linkreport

Or maybe it couldn't have anyway.

Again, I don't think this is a surprise - it didn't seem like it was going out on a limb to predict that PotP as structured was not going to shift trips all that much.

Of those two motivations, I'd say revenue was responsible for 85% of it. The 15% devoted to shifting ridership was less about actually shifting ridership and more about providing some cover for yet another fare increase (if my memory serves, that was to be the third in three years).

You'll get no argument from me on WMATA's need to raise fares in that budget cycle - I just think the negatives of PotP (added complexity to an already complex and almost incomprehensible fare structure, etc) far outweigh the benefits. WMATA should have just raised that revenue by making the across the board fare increase 35 cents instead of 30 or something along those lines.

by Alex B. on Jun 28, 2011 11:00 am • linkreport

@David A: Isnt a To:/From: solution a zone fare system by other name? Call it "DC Downtown" and charge 50c PotP, and leave the rest of the system with regular fares. The complexity has not increased and the "capacity hoggers" are the ones paying for it. What alternatives the users have for trips within "DC downtown"? Bus, bicycle, cabs (ok, ideally with a synchronized offering like London) so it's balancing the public transportation more effectively with a inter-mode impact(hope they don't drive since there is no parking in downtown, right?)

@David C: is not a question to be a bargain or not. Is the only alternative, hence there is no "shift" as I pointed out. Is not that im "willing to pay the PotP" is that me and all DC-outbound morning commuters cant do another thing...or we can get a car, but is that what the PotP wants?

I dont think your example is correct, a particular airline doesnt impose a surcharge to passengers that fly only 8-9:30 to/from any destination (customers will choose an alternative). They DO charge differently for destinations more congested, at any time of the day/week. Same with gas tax, you charge to all. And i didnt talked about relation costs to fares at all. So it's about aligning the fares with the intended behaviour WMATA wants users to have (and increase revenues).

Once again, my point is that Im ok to charge a levy to ALL passengers (if we are trying to increase WMATA revenues, get more weekend trains, better integration with bicycle, bus, cabs, fix scalators...) or just to the ones using full capacity (if we are trying to get them to pay for additional trains or shift to other public transp. options). And we should do it for ALL transportation modes (yes, cars included)

And im dont know that many public transportation parables in the bible (St Paul rode his own horse until he had an accident after all), but i do not think is fair for users that do NOT have alternative PUBLIC transportation and do NOT cause overcrowding to pay extra. I get David A point about simplicity, I think simplicity here is not achieving the PotP goals, so PotP (or any fare increase) can be improved.

by RE on Jun 28, 2011 11:13 am • linkreport

@Alex B: exactly was i was going after

by RE on Jun 28, 2011 11:19 am • linkreport

@RE:

It is sound policy to charge more for congestion. I think the airplane example was quite apt. See the Wikipedia entry on Price Discrimination for more examples.

(As an aside, this is an example of a imperfect market. However that doesn't mean we throw out the idea of market-based solutions all together)

Peak of peak wasn't ideal, but Metro has to balance complexity against efficiency. Of course not everyone is going to be happy.

by WRD on Jun 28, 2011 11:36 am • linkreport

@WRD: agree on your points on charging more for congestion and price discrimination. However, my point is that PoP is not a charge for congestion but a tax to increase revenue (as Alex B and David A shown above, dont need to beat that agian)....and for the 3rd time, Im ok with increasing WMATA revenues, for the reasons I mentioned as well. And price discrimination in a private company (airline) main goal is maximize profits considering competition and other factors. It doesnt matter how you discriminate (provide is legal and you can make extra profits). The airline CEO will answer on that to shareholders. But thats not WMATA's goal or environment, thats why i said is not the right example.

Agree PotP is not ideal, thats why im saying we should improve the fares (with zoning, better system software for calculating fares, less fare complexity, integrated schedule and fares with bus, circulator, bicyle, other agencies....) to the issues that WMATA has recognized like increase ridership, revenues, reduce congestion...Right now PotP just focuses on increase revenues on the less elastic customer segment ...if I was a WMATA commissioner (not sure thats the word) i'd add another 30c to Potp next year, politically is the safest bet and Id probably will get away with it. thats a short term solution that doesnt solve WMATA's problems.

by RE on Jun 28, 2011 11:57 am • linkreport

Think of it in performance parking terms - if you increase the rates but that still doesn't get you to the Shoupian 85% occupancy level, then you haven't yet seen any benefit from that increase.

I totally disagree. The small amount of shifting we've seen would mean that some trains that were totally full, would be slightly less than totally full. Or that the 30 people left on the platform is now only 27 people. That means service is slightly better. This is not a binary system. An incremental change is an incremental improvement.

But thats not WMATA's goal

This is the part of WMATA that I think people get hung up on. Some say "Metro doesn't turn a profit and is subsidized so it's a failure", but WMATA isn't a business with a goal of maximizing profit. If they were, they might be able to turn a profit (on operations at least) by raising fares.

Some say "WMATA isn't maximizing ridership" as though that were the only goal. But if that were the only goal it wouldn't charge fares at all.

WAMTA has to straddle the two and try to maximize ridership for the subsidy they're given. If there is a time of day when they have a large, well-funded market that is largely captive to their pricing, by all means they should charge them what the market will bear. There a sweet spot where raising or lowering prices will decrease riders per dollar of subsidy, and that's what they should aim for. Clearly we're not there yet.

by David C on Jun 28, 2011 1:42 pm • linkreport

That's funny. Whenever I read something from the Reason Foundation, no matter how reasonable given the context, I always think of Maslow's Hammer-Nail line. Ironic given the use, considering all things must be market-rated according to Reason no matter how much context or availability of spin-off cost/benefits there might be, particularly of the sorts that are yet incalculable. But surely don't think about that when they suggest they have objectivism on their side.

by WalkableDFW on Jul 6, 2011 8:43 am • linkreport

Add a Comment

Name: (will be displayed on the comments page)

Email: (must be your real address, but will be kept private)

URL: (optional, will be displayed)

Your comment:

By submitting a comment, you agree to abide by our comment policy.
Notify me of followup comments via email. (You can also subscribe without commenting.)
Save my name and email address on this computer so I don't have to enter it next time, and so I don't have to answer the anti-spam map challenge question in the future.

or

Support Us