4. Small Transit Intensive Cities

The typical transit system serving a small urbanized area generally has somewhat different characteristics from those serving larger urbanized areas. In small cities, the focus is generally on providing basic mobility for residents, especially those whose access to auto transportation is limited by age, income, or disability. Modes provided are limited to bus and/or demand response services operating at relatively low frequency. Such low volume systems often have a significant need for operating assistance to pay for the costs of running the system. By contrast, mass transit in large cities will often play additional roles in providing relief from traffic congestion and encouraging efficient land use patterns. Schedule frequencies are high, and bus systems may be supplemented by high capacity, high-speed rail systems. The greatest funding needs are generally on the capital side, as transit systems need to replace large, heavily utilized vehicle fleets and fund service expansions as the urbanized area grows.

As with any such generalization, however, there are some small cities that differ significantly from such norms. Such cities provide a level of transit service far greater than their size and density characteristics would typically suggest. In fact, some of these so-called Small Transit Intensive Cities operate more vehicles and carry more riders than do other cities with much larger populations. These cities generally share one or both of the following characteristics:
Special Populations. Many small transit intensive cities have special characteristics that encourage high transit usage. One example is college and university towns. The campus provides a high volume activity center for the community, and nearby parking may be limited. College students generally have below-average auto ownership and tend to live in high density housing. Such factors contribute to a higher level of transit usage than would be typically seen in a community of its size. Similar factors contribute to high transit usage in other small cities with special populations, such as resort destinations.

High Levels of State and Local Transit Funding. States and local governments vary widely in their commitments to providing public funding for mass transit. In areas where mass transit is seen as a priority, capital and operating assistance from state and local governments may allow a transit operator to provide much more service than is typically provided in other small urbanized areas without such funding.

4.1 Measures of Transit Intensity

The language of Section 3033 of TEA-21 and the discussion above imply that small transit intensive cities should have certain measurable transit system characteristics. In order to understand just how extensive the issue of small transit intensive cities is, measures of transit service intensity were computed for transit operators in urbanized areas for the period 1996-98. The computed measures of transit service intensity can be grouped into four categories:
Vehicle Utilization

Transit intensive cities have transit systems with vehicles that are heavily utilized by the public. Measures of vehicle utilization include passenger miles per vehicle revenue mile and passenger miles per vehicle revenue hour. These measures are noted in the language of Section 3033 of TEA-21, which also makes reference to transit vehicle utilization levels in small urbanized areas that exceed the averages for such use by urbanized areas over 200,000 in population.

Service Provision

Transit intensive cities provide a high level of transit service to their citizenry. This can be measured by vehicle revenue miles per capita or vehicle revenue hours per capita. There are several small cities that can be classified as transit intensive by these measures.

Service Consumption

Transit intensive cities have a high rate of service consumption by their populations. This can be measured by passenger miles traveled per capita or unlinked passenger trips per capita.

Statistical Outliers

Transit intensive cities have service levels that are significantly greater than would be predicted given the urbanized area's population and population density. In the language of statistical modeling, such cities would be called "outliers." In the context of the above discussion of need, these are cities whose existing needs (reflected by service levels) are not captured by their potential needs (reflected by population and population density).
For purposes of measurement, small transit intensive cities were defined as small urbanized areas whose intensity measure exceed the average for larger urbanized areas (population between 200,000 and 1,000,000). Such a definition is in keeping with the language of Section 3033. Statistical outliers were defined as small urbanized areas with substantially greater service provision (vehicle revenue miles) and service consumption (passenger miles) than would be expected given their size and density, as determined by a regression analysis. Exhibit 1 lists the small urbanized areas that can be classified as transit intensive by one or more of the above criteria.

Exhibit 1: Small Transit Intensive Cities

There are several important caveats in interpreting these measures. The most important concerns the area served by the transit operators based in each small city. Many transit operators in small urbanized areas also serve populations outside the primary urbanized area, either in other urbanized areas or in nonurbanized areas. Unlike transit operators serving large urbanized areas (over 200,000 in population), however, these transit operators are not required to break out their formula-related operating statistics (passenger miles and vehicle revenue miles) by urbanized area. Population figures, however, are for the primary urbanized area alone. Thus, the per capita intensity measures may be slightly inflated by service provided outside of the primary urbanized area. See Appendix A for more detail on the data and methodology used in these calculations.

4.2 Funding Issues

As currently constituted, the urbanized area formula for small urbanized areas includes demographic factors (population and population density) but not service factors (vehicle revenue miles, passenger miles, operating costs), as does the bus formula for large urbanized areas. In the context of the earlier discussion on needs, this means that the funding formula for small urbanized areas reflects potential needs but not existing needs. Small transit intensive cities, however, are precisely those that do offer high levels of transit service relative to their size. Thus, transit systems in such cities receive less federal formula funding than they would if the formula also used service levels.

According to commenters on this study, however, such systems were in the past often able to make use of other sources of federal transit funding whose availability has diminished in recent years. Among these sources were:
Discretionary Capital Grants

Because of their nature and the issues facing them, small transit intensive cities were often strong candidates for receiving discretionary funds through the Section 5309 Capital Investment Grants program. Increased congressional earmarking of these funds in recent years, however, has substantially reduced the availability of these funds on a discretionary basis.

Unused Governor's Apportionment

In some states, transit operators in small transit intensive cities were able to make use of portions of the Section 5307 Governor's Apportionment that would otherwise be unused. The two sources of this unused portion were the operating assistance cap and cities without transit service.

The operating assistance cap

Prior to TEA-21, urbanized area formula funds could be used for either operating or capital expenditures, subject to a cap on the amount that could be used for operating assistance in each urbanized area.3 Many transit operators, especially in small cities, had funding needs that were primarily on the operations side, rather than capital needs. As a result, they were unable to use the full amount of the formula funding attributable to their particular area, and the "excess" was made available for reallocation to transit operators in other areas with capital needs. Many small transit intensive cities were able to obtain additional capital funding in this way. TEA-21, however, gave full flexibility to small urbanized areas on how formula funds could be allocated to capital or operating use. As a result, small urbanized areas with operating assistance needs are able to devote their full allocation to operations, and the excess is no longer available for redistribution.

Unserved urbanized areas

In some large states, there are small urbanized areas which do not have any transit service that is eligible for Section 5307 funding. Such states are able to redistribute the portion of the Governor's Apportionment attributable to such areas among cities that do have transit service. As more small urbanized areas initiate service, however, these unallocated funds are reduced.4
The result of these reductions in available funding sources has left operators in small transit intensive cities with more limited resources for capital needs even as they face pressures from their communities and customers to expand and improve existing service.
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3 While the operating assistance cap was only phased out under TEA-21, it had been raised in the years just prior such that the cap was rarely binding for small urbanized areas. Thus, this avenue of additional funding was primarily available in the more distant past (ca. 1995 and earlier).

4 Between 1996 and 1998, the number of small urbanized areas with a transit system reporting operational data increased from 196 to 206 (out of 281 total urbanized areas between 50,000 and 200,000 in population).