Los Angeles’ public transit agency is facing the biggest operating deficit in its history -- roughly $250 million. The results won’t only hurt bus riders. If the Metropolitan Transportation Authority cuts back on service, it will drive more people to drive, jamming Southern California’s roads and polluting its air even more than usual.
The economic downturn gets most of the blame. High joblessness means less ridership, cutting receipts at the fare box. A drop in sales taxes hits the agency particularly hard, and continual borrowing of transit funds by Sacramento worsens the pain. Yet none of these problems lies at the heart of what really ails the MTA: Voters tend to think they can have a decent transit system without paying for it, and politicians lack the courage to tell them otherwise.
Though the shortfall is worse this year than ever, the MTA has had a structural budget deficit since the late 1990s. Usually, the politicians on the agency’s board make up the difference by digging into reserve funds or making other one-time fixes rather than addressing the underlying problems. That can’t go on forever.
One cause of the shortfall is low fares. In most big U.S. cities, it costs at least $2 to ride the bus, and big-city transit agencies typically make enough from fares to cover about 40% of their operating expenses. In L.A. a one-way ride costs $1.25, and fares cover only about 26% of the MTA’s expenses. The fare will jump to $1.50 in July, but that still won’t be enough to make up for the budget shortfall. One solution would be to impose an annual schedule of hikes to put fares in line with other cities and allow them to keep up with inflation. Ridership would probably fall in the short term, but such fare-based plunges seldom last long; moreover, L.A. bus and rail riders are going to have to pay their fair share of the costs if they want to avoid deep cuts in service.
Transit subsidies at the state level are also problematic. Voter initiatives have tied transit funding to the sales tax on gasoline, an unstable source that state lawmakers have found relatively easy to divert. Transit funds should more properly come from the excise tax on gasoline, a per-gallon charge that doesn’t change regardless of prices at the pump -- and that tax, which hasn’t been hiked since 1994, should be raised and indexed to inflation. You can’t keep building new transit lines and raising operating costs while relying on a static revenue source.
Mayor Antonio Villaraigosa has done a good job promoting the much-needed “subway to the sea,” but he seems to regard this as the only public transit legacy worth pursuing. He could do more lasting good by having the courage to fight for genuine solutions to the MTA’s structural deficit.