So, let’s say you do ride the bus. You pay your $0.90 (or a dollar, if you haven’t got exact change). How much service is that fare paying for? And how does our bus service get paid for overall?
I got the chance to hear these details from Long Beach Transit’s Manager of Government Relations, and it’s quite an interesting story. First, I should mention that Long Beach Transit is not a city department, but rather a non-profit corporation owned by the City of Long Beach. It’s run by a Board of Directors who are appointed by the Mayor and confirmed by the City Council.
The total capital and operating budget for the current fiscal year is a little over $93 million. Capital funds are used to pay for buses, equipment, buildings, fuel tanks, and the like, while operating funds go for salaries and benefits, supplies, fuel, and everyday upkeep. Some kinds of revenues can be used for either purpose, but more commonly funds are restricted to one use or the other. Operating funds are in shortest supply, so even when the agency has plenty of capital, say, to buy new buses, there’s little point if operating funds aren’t available to run them.
It turns out that our fares provide only one-fifth – that’s right, about 20-21% – of the system’s operating costs. The largest single portion of the operating budget, nearly 40%, comes from state sources, but a quarter comes from county funds – quite a substantial share. These are funds collected from two half-cent sales taxes: Proposition A, passed back in 1980, and Proposition C, passed in 1990. These funds come to Long Beach Transit through the LA County Metropolitan Transportation Authority (MTA), which uses some of the money to run its own transit system (including the Blue Line to Long Beach and numerous buses county-wide). MTA distributes the remaining funds to sixteen municipal transit systems in the county, including Long Beach Transit, according to a formula set in state law. (Long Beach Transit also gets a portion of “local return” funds from the City of Long Beach under Proposition A.)
Here’s a word about the state funding, and the state budget. Funds that come to Long Beach Transit out of the state sales tax collected on fuel can be used for operating or capital – useful money, in other words. The amount anticipated this year was about $7.5 million – right around ten percent of the operating budget. However, because transit funds have been diverted to balance the state’s budget shortfall – in the version just signed by Governor Schwarzenegger – the actual amount Long Beach will receive is about $4 million short this year. The LB Transit board will be meeting soon to decide how to handle this shortfall.
I’ve said this before, but I’ll mention again that LB Transit has been a leader in acquiring low-emission buses. About sixty of the 220 buses in our fleet are gasoline hybrids – same technology as a Prius, and they don’t burn diesel fuel – and more are on the way as older diesel buses retire. In fact, we are ahead of state regulations for transit bus fleets, but within the next 3-4 years, new regulations are expected that will require the purchase of “zero-emission” (electric or fuel cell) buses. Reportedly, these technologies have not yet been perfected for use in transit fleets.
Finally, a word about Measure R. I’ve also mentioned it in passing before, but in November we’ll see this additional half-cent county sales tax measure on the ballot. According to a fact sheet provided by LA County MTA, “The revenue generated from the existing transportation sales tax is inadequate to fund the range of transportation projects that [MTA] believes the County needs over the next 30 years.” The fact sheet also tells us that the Los Angeles County Economic Development Corporation estimates Measure R will cost each county resident an average of $25/year. And LB Transit estimates that the measure, if passed, could yield $7 – 10 million in operating revenues per year.
As pressure grows to reduce greenhouse gas emissions, state and local policies are beginning to emphasize “transit-oriented development.” If such policies are to be successful, we will need to find ways to pay for enhanced transit services. Come November, I will be interested to see if LA County voters believe Measure R is one of those ways.