Rethinking Transit

A reconstruction could be brewing for Miami-Dade Transit. Commissioner Javier D. Souto wrote an open letter last week discussing the issues that have arisen with the People’s Transportation Plan. Somehow the Miami Herald has ignored it in their series so far, but the South Florida Business Journal covered the letter. Souto begins by discussing the importance of mass transit in the day of $4/gallon gasoline and the continued difficulty with getting people out of their cars into an inconvenient transit alternative. After going on about the problems we have, he proposes a radical idea: privatize transit.

Souto starts the paragraph by saying, “if the desire is to make a profitable transit system…” This is where I imagine his whole paragraph must be sarcasm. Then I remember that there are still those who are convinced that transit should be funding itself, and those people would desire to make a profit from a transit system. So, Souto (or anyone else), if that is your desire, quench it. Transportation is not profitable. Period. Government subsidizes every aspect of it, from roads to railroads to bus systems to Metrorail. It’s a subject worthy of an entire post, so let’s just make it clear that profit should not be the goal of any transit system. Not unless we have a major paradigm shift to also make a profit with roads…

Regardless of motive, privatizing transit is not unheard of. The original streetcars in the US were all privately owned and operated. Unfortunately, that made it easier for them to fold as the automobile became the preferred mode of transportation in this country. The same thing happened with intercity passenger rail, and only a subsidized Amtrak is left standing. Those systems failed because their goal was to make a profit.

Today we have brought mass transit under government subsidy, and we have developed Public-Private Partnerships (PPP) that maintain governmental control and regulation. The I-595 project is a good example, as a private company will design, build, finance, operate, and maintain the improvements, while FDOT maintains control over things like standards and tolls. FDOT will not be turning a profit from the system, either. The toll FDOT collects will not be sufficient to pay off the concessionaire company for building it, so they will be using other budgeted funds to pay for it. Profit is the motivator for the private company, of course, but not for the government agency. Transit could work the same way. A private company could design, build, and finance Metrorail improvements, while operating and maintaining the existing and future system. The county would still have to control things like fares and basic standards.

That brings us to the biggest problem. Someone responsible would still have to manage a PPP. Until the county takes some major steps in the right direction, we would not have the confidence for them to direct a PPP any better than they have the current state of affairs. Could a PPP have any success in Miami-Dade Transit? Perhaps. Privatization might boost the confidence that transit can be managed properly (or it might not), but alone it is not sufficient to solve the woes of the People’s Transportation Plan. And it most definitely will not solve any financial woes. No profit will come to the government from such a privatization. Do you hear that, all you profit-minded capitalists?


Photo by Flickr user ImageMD


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  3. MDX: Dismantling Our Transit System One Route at a Time
  4. 15 Seconds of Transit Fame
  5. Federal Transit Rules Change, but In Miami More of the Same
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9 Responses to Transit Privatization

  1. Emperor Tomato says:

    It would be nice if the county tried to be efficient, or used our taxes in an effective way. I’m all for penny pinching where it can be done.
    I’m ok with the Private public partnership, and if a private company wants to build it fund it and get a 50 year lease I’ll support that.
    But if the county funds and builds, I am not in favor of giving it to a private entity to run and potentially profit.
    Also, handing over public roads and rails without setting up a public board of elected officials takes all price controls away from the public.

  2. Souto’s letter does have some interesting points; however, the gist throughout is still the same: “Transit (and the county) overpromised.”

    What do you think of his referendum-of-a-solution? A straw vote to put the 1/2 penny to buses or trains…

  3. JM Palacios says:

    Sorry I didn’t cover more of his letter; I was trying to focus on the privatization idea.

    The referendum feels like he is digging around desperately for ideas. Why should we be pitting buses against trains? I would be for the trains, but they don’t go everywhere. Transit needs both modes to work together to function properly. It seems to me like he’s thinking of the old argument that prefers buses over trains because they’re cheaper, and he hopes to convince voters of that.

    Buses just won’t cut it with a lot of people. I myself will ride the bus occasionally, but slow, unreliable service is the main reason I choose to bicycle to work every day. If I’m riding beside a bus on a 35mph street, we take turns passing each other. I pass him when he stops, and he passes me between stops. So overall I’m going just as fast!

  4. I understand your argument completely. Though I don’t currently ride my bike to work, I hope to do so soon. Ultimately, I think that sort of a straw vote in this community will be one that either gets skipped or glossed over by most voters, for whom transit doesn’t work anyhow.

    It would appear that the only solution to this crisis is sound management and a dedicated funding source not completely linked to fare-box revenue.

  5. JOrphe says:

    I just don’t understand why you all have a pet peeve with profit-driving transit companies? With years of wasted tax money, and corruption/political influence; calls to let Miami-Dade keep the status-quo is indeed more foolish than to create an private sector. Just look at Hong-kong, they have a privatized transit system that is efficient and so far, no whining passengers complaining about how the company “profiting” out of them. I think you all need to continue to do the research. Profit-center transit systems may seem “evil” to you transit fanatics but it is the only way that we residence can have a fully efficient public transportation system in this county.

  6. JM Palacios says:

    JOrphe, I’m sorry if I wasn’t clear enough on the issue. The only way you can get private companies involved in something is if they will profit. We don’t have a problem with them profiting from privatization. What I was saying is, the government will not profit. The way Souto made it sound in his letter was that somehow we would be turning transit into a profit-generating machine. That’s not what would happen. The government would be paying a private company to run transit, so as an elected official, he would still have to make sure it is funded. Transit would be privatized, but still subsidized. With current conditions in the U.S., no transit system can turn a profit without subsidy. (Unless the capital costs are already paid off and no expansion is taking place.)

    Our call is by no means to let Miami-Dade keep the status-quo. The call is for them to fix their problems without assuming that privatization will fix everything. If they have management and funding problems now, those problems could persist with mere privatization. In the sense that privatization will shuffle things up, then we are all for it. You just have to remember that privatization doesn’t and shouldn’t take control away from elected government officials.

  7. dwhuff says:

    Great site! Nice to see others sharing model railroading ideas

  8. John G says:

    Hey All,

    Transit privatization is actually a terrible idea. I could go into detail but there is a vid on youtube that clearly and efficiently explains it:

  9. John G says:

    Sorry the link didn’t come through:

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