Expert says public transportation doesn’t make money

By Emmanuel T. Erediano, Aug 26, 2013
[http://www.mvariety.com/cnmi/cnmi-news/local/58530-expert-says-public-transportation-doesn-t-make-money ]

ONE of the consultants currently conducting a feasibility study for Saipan’s fixed-flexed route and para-transit system says public transportation does not make money. But “there is a need out there,” according to Transit Consulting Network president Wally Beck of Ontario, Canada. Beck is the main consultant contracted by the Commonwealth Office of Transit Authority to determine whether, under what conditions and at what cost, public transportation can be introduced, operated and sustained on Saipan, and, eventually Rota and Tinian. With him was Charles Fitzsimmons, founder and chief executive officer of TechKnowledge Consulting.

Their study, according to special assistant for public transportation Thomas J. Camacho, includes “a comprehensive analysis of past and existing transportation systems, existing and future land-use patterns, travel-demand patterns and roadway-congestion issues.”

Beck and Fitzsimmons presented data on car ownership on Saipan, Tinian and Rota, which showed that 23 percent of households had no vehicles. Their presentation also showed that car ownership was the second biggest household expense, next to home ownership. Some of their data indicated that a person earning $10 per hour must work approximately 12 to 16 hours a week to cover the cost of owning and operating a car.

They said that public transit, if properly designed and supported, “can reduce the need for car ownership.” They also presented transit peer reviews that indicated the population of different states and territories that have transit systems.

Fitzsimmons said they need to know what would be required to get an average level of services and determine the demand. When asked how feasible it is going to be if the population is declining, Beck said he has never run into a situation where the population is declining. He said that depending on what comes out in the feasibility study, they may suggest a slow start-up model “and it’s up to the decision-makers to determine what ‘feasible’ means. In other words, how much money are we going to spend? Transit system do not make money. No transit system does. So it comes right down to how much they want to invest in the community for those that don’t own a car, need to go to the doctor and need to go shopping but have no means.”

Beck said having a transit system is a quality of life issue. It is a public service. “If we build a library or a bicycle path, nobody asks how much money we get back from that bicycle path.,” he said. But he added that transit “is critical”: “People have to go to medical appointments. And if they have to pay $10 or $20 for a taxi, then, what are they sacrificing? Food?”

He did not mention that on Saipan, illegal taxis charge $3 only, and those who do not own cars usually share rides with their friends who have vehicles.

Beck said the capital funding to start up the system is provided through the federal transit agency, but the operating costs are borne locally. Aside from the revenues that depend on how many people use the transit system, there are other things that can be done to earn money, Beck said. “You can possibly sell advertising space at bus shelters — you can sell advertising on buses and you can use them for special events because there are going to be wheel-chair-accessible buses,” Beck said. Camacho said since COTA was created, its activity has grown tremendously. He said they are now using two vans because they have a “steadily increasing number of riders.”

Former high school teacher Ambrose Bennett said there are many people in Kagman who do not have their own cars. Most of them are students and workers. “In fact two people who are in my rent-to-own tricycle program, told me they would not have a job if it were not for my rent-to-own motorcycle program,” he said. “My neighbor down the street just recently gave her car to her daughter so her daughter could get to work and she rented a motorcycle from me so she could get to work as well. There are a lot of people in Kagman that really need transit services,” he added.

Bennett said a transit system may actually motivate people to get a job because they won’t have to worry about not having a car to get to work. He believes that most of those on food stamps are there because they can’t get to work due to lack of transportation. Beck said the feasibility study will show the cost model or the business model and what governance should be in place to operate the transit system. Then the cash-strapped CNMI government will have to decide whether it is going to put money into it and how much.

Beck said it will take a few years for people to get used to a transit system. “Everybody has to be patient. You don’t build a highway over night. It takes time,” he added.

Amtrak, the U.S. intercity passenger railroad supported by federal taxpayers, reported in March that its losses in fiscal year 2012 were $361 million, the lowest since 1975, down from $446 million in the previous 12 months. Established in 1971, Amtrak has never made an annual profit.

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