Urban Area Transit Strategy Advanced Technology Update August 2019 Technical Appendix C . Urban Area Transit Strategy Technology Update Shared Mobility Public/Private Partnerships White Paper Prepared By CHS Consulting Group June 3, 2019 1.0 Summary of Findings Over the past decade, new players have appeared on the transportation scene, and they’re making their presence felt. Shared mobility modes like bike share, car share, ride‐hailing, and microtransit have widened the choices available for movement, particularly in urban areas. The extent of their impact on public transportation is a matter of lively debate, with few definitive conclusions. Nonetheless, their allure to the public is obvious, and many transit systems have wondered if they should partner with these new service providers, rather than compete with them. This White Paper explores such partnerships by focusing on three case studies in which a transit agency or city has forged bonds with private ride‐hailing and microtransit companies. Due to the reluctance of private operators to reveal what they consider to be proprietary information, hard data on costs and cost‐effectiveness are often difficult to come by. This is true even when public agencies are sponsoring the service. Nonetheless, it appears that, for the most part, the operating efficiency of modes such as ride‐hailing and microtransit are only a fraction of what would be expected from fixed‐route services, whether or not a public partnership is involved. The attractiveness to public agencies may be that the overall cost of such service in a particular area is less than what would be required with a fixed‐route alternative. This seems to be the case for AC Transit in San Francisco’s East Bay, which is operating its own microtransit service in partnership with a company that developed its dispatching software. In other areas, such as Pinellas County, Florida and West Sacramento, California, partnered shared mobility services have been overlaid on a fixed‐route system. These have been implemented to provide first‐mile/last‐mile connectivity to fixed‐route transit, as well as to offer a travel experience closer to what transit’s competitors have been delivering. One theme that continually emerges in this inquiry is whether transit in any form—fixed‐route or demand‐responsive, operated publicly or through a partnership—is warranted in low‐ demand areas. From a technical standpoint, the answer is usually “no.” Agencies like the Metropolitan Transit System (MTS) generally have standards that guide them in determining where transit service is cost‐effective and where it is not. However, issues of geographic or socio‐economic equity are also a factor in most urban areas, whether or not they are codified in local ordinances. These often impel public agencies to provide service where none would be warranted according to adopted guidelines. The field of shared mobility is still young and evolving, so what has been experienced to date may not resemble future operations. Nonetheless, the current partnerships between public and private entities appear to be a fruitful way of moving into the future. They will inform subsequent decisions by public agencies on if and how to provide transit service, particularly to low‐demand areas. 1 2.0 Introduction and Background The Urban Area Transit Strategy (UATS) was undertaken by SANDAG in 2011 as a component in developing the 2050 Regional Transportation Plan (RTP). The objective was to guide the RTP by comparing alternative transit strategies for the more urbanized areas of the San Diego Region. Various transit networks and modes were hypothesized in a series of planning scenarios in order to home in on the most effective for inclusion in the RTP. This process included brainstorming sessions with key stakeholders, examination of strategies employed in other urban areas, and computer simulations of operations and ridership. In preparing San Diego Forward, the 2019‐2050 update to the RTP, SANDAG wanted to consider the effects of new technologies that have emerged since the last version of the RTP was released. These include connected and autonomous vehicles, electrically‐propelled vehicles, and various app‐based transportation services, such as ride‐hailing and microtransit. A report prepared for SANDAG in February 2018 summarized the wide range of such emerging technologies. The purpose of this White Paper is to focus on subsets of the previous effort by investigating two forms of app‐based shared mobility providers. Ride‐hailing companies offer rides in personal vehicles to customers who request them through a smartphone application, and many of these companies provide shared‐ride options. Microtransit companies use vans or small buses to serve defined stops but not necessarily with defined routes or schedules; they may be summoned with a smartphone application (“app”) or through a call‐in system. In most instances, the app‐based services operate independently of existing transit providers, but in some instances, partnerships between the two have formed. This report examines partnerships between public agencies or jurisdictions and shared mobility transportation services. Shared mobility services constitute a potential threat to public transportation, as evidenced by transit ridership losses throughout the country after these services were introduced.1 On the other hand, these services provide an opportunity for the public sector to relinquish direct operation of transit in areas that may be more cost‐effectively served by the private providers. This White Paper explores these themes in a general way and then concentrates on three case studies that can provide lessons for the San Diego region. 2 3.0 Shared Mobility Partnerships 3.1 Diversity of Partnerships App‐based providers such as Uber, Lyft, and Via operate shared mobility services in many American cities, as well as overseas. As mentioned, these services are generally independent from other forms of transport and, in effect, compete with them. Private autos, taxis, and public transportation all have been impacted as some of their ridership has been diverted to the shared mobility providers. This trend is generally considered positive in regard to lowering individual auto trips but negative in its impacts on transit. Partnerships between the public sector and private shared mobility companies can help overcome these negative impacts. With some financial incentives, cooperating private providers could serve low‐density areas, offering area‐wide service or first‐mile/last‐mile connecting service to a transit system’s trunk lines. This would allow the transit agency to focus its resources on high‐density corridors, which is a more cost‐effective business model for them. In this respect, the public and private providers could be complementary rather than competitive. Partnerships throughout the U.S. are diverse in terms of how they are organized and how they function. The public partner is generally a public transit operator, such as in Atlanta, Dallas, and Kansas City. However, jurisdictions (such as New Haven and Seattle) have also formed partnership with private transportation providers. Other bodies, like Transportation Management Associations (TMAs) have also served as the “public” partner (as in Centennial, Colorado). The private service providers include car‐share companies (e.g., HOURCAR in Minneapolis), bike‐share companies (e.g., Pittsburgh Bike Share), ride‐hailing services (e.g., Uber and Lyft), and microtransit operators (e.g., Via and the former Bridj and Chariot). In many cases, the private entity operates under a cooperative agreement with the public entity. Sometimes this agreement involves nothing more than sharing software so that the users of a public service can find a link to the app of a private provider in the community, and vice versa; that’s essentially what’s being done in Dallas. In other cases, the private entity operates a service that is partially subsidized by the public entity, as in Philadelphia. Sometimes the service itself is operated by the public entity using routing/dispatching software provided by the private entity (as in Marin and Alameda counties in California). The nature of the service in these partnerships also varies. Common are first‐mile/last‐mile feeders in which the private provider’s vehicles or software enables service to and from low‐ density communities where conventional fixed‐route service is not cost‐effective for the public operator. In these systems, the private provider brings passengers to bus stops or rail stations operated by the public provider, as is practiced in Pinellas County, Florida and Dayton, Ohio. Another variation is area‐wide service. Passengers are transported by the private operator throughout a neighborhood or an entire city at rates subsidized by the public partner, as in 3 Arlington, Texas. In some locations—as described later for West Sacramento, California‐‐the distinction between these functions blurs. 3.2 Adapting Private Models to Public Service Much of the initial interest in private shared mobility services was based upon their success in attracting customers, often at the expense of transit. Transit ridership fell in 30 of 35 major U.S. metropolitan areas in 2017,2 but even transit’s critics point out that shared mobility is not the only cause. Cheaper gas prices, more teleworking, greater on‐line purchasing, and slower buses caused by increased congestion are also contributing elements. In fact, a 2016 American Public Transportation