ACCESS-A-RIDE Ways to Do the Right Thing More Efficiently
September 2016 FOREWORD
Founded in 1932, the Citizens Budget Commission (CBC) is a nonprofit, nonpartisan civic organization devoted to influencing constructive change in the finances and services of New York State and New York City governments. A major activity of CBC is conducting research on the financial and management practices of the State and the City and their authorities.
All CBC research is overseen by a committee of trustees. This report was prepared under the auspices of the Transportation Committee, which we co-chair. The other members of the Committee are Eric Altman, Ken Bond, Thomas Brodsky, Robert Burch, Lawrence Buttenwieser, Vishaan Chakrabarti, Herman Charbonneau, Steve Cohen, Rob Dailey, David Dantzler, Douglas Durst, Jake Elghanayan, Mary Francoeur, Bud Gibbs, William J. Gilbane, III; Martin Grant, Walter Harris, Peter Hein, Dale Hemmerdinger, Brian Horey, David Javdan, Steven Kantor, Andrew Kimball, Robert Krinsky, William Levine, James Lipscomb, Anthony Mannarino, Jim Normile, Charles John O’Byrne, Geoff Proulx, Carol Rosenthal, Michael Ryan, Brian Sanvidge, David Schiff, Dominick Servedio, Timothy Sheehan, Sonia Toledo, Claudia Wagner, Ron Weiner, and Edward Skyler, ex-officio.
The Committee’s work has focused on the finances of the Metropolitan Transportation Authority (MTA). Since 2004 the Committee has studied the MTA’s operating and capital budgets. This report explores the past, present, and future of Access-A-Ride, the MTA’s nearly half-billion dollar paratransit program that provides service for the mobility impaired in New York City.
Jamison Dague, Director of Infrastructure Studies, researched and prepared this report. Charles Brecher, Director of Research at CBC and Professor Emeritus at New York University’s Robert F. Wagner Graduate School of Public Service, provided research and editorial guidance and supervision.
TransitCenter generously funded the research for this report. The staff of TransitCenter, headed by Executive Director David Bragdon and Director of Research and Learning Tabitha Decker, played an important role in helping to facilitate the research, but CBC is responsible for the findings and recommendations. We thank them for their support and comments on various iterations ofthis report.
A draft of this report was reviewed by the MTA’s Vice President of Paratransit, Tom Charles and the MTA’s Chief Financial Officer, Robert Foran, as well as their staffs. In addition we shareda draft with New York City Transportation Commissioner Polly Trottenberg, New York University Rudin Center Director Mitchell Moss and Assistant Director for Technology Programming Sarah M. Kaufman, and Disabled in Action Vice President Edith Prentiss. We are grateful for their comments and suggestions; their willingness to help in preparation of the report reflects their commitment to the public goals their organizations serve but does not necessarily indicate their endorsement of any of CBC’s recommendations.
Kenneth Gibbs, Co-Chair
Steven Polan, Co-Chair
September 20, 2016
2 TABLE OF CONTENTS
1 EXECUTIVE SUMMARY 4 INTRODUCTION 6 EVOLUTION OF THE SYSTEM The ADA and Federal Standards Access-A-Ride’s Founding and Transfer to the MTA 1997 to 2008: Mushrooming Growth 2009 to 2016: Reining in Costs Access-A-Ride Today The Outlook to 2020 15 A COMPARATIVE PERSPECTIVE High Utilization Low Productivity 19 OPTIONS FOR IMPROVING EFFICIENCY AND FINANCING Lower Cost per Trip Better Manage Demand Change the Revenue Mix 27 REDESIGNING ACCESS-A-RIDE’S FUTURE 28 ENDNOTES
1 EXECUTIVE SUMMARY
Access-A-Ride (AAR) is the Metropolitan slowed AAR’s growth, saving the MTA nearly Transportation Authority’s (MTA) paratransit $2 billion from projected costs since 2009. program. Paratransit is the service offered Still, the outlook is for AAR’s fiscal problems to those who are unable to use the mass to worsen. The current financial plan projects transit agency’s subways and buses because total program expenses will reach $621 million of physical limitations. A fleet of contracted in 2020 as the volume of trips increases 6.5 vehicles supplemented by taxis and for-hire percent annually and the cost per trip surpasses vehicles provide 144,000 New Yorkers more $77. The amount of MTA revenue used to than 6 million rides annually, more than 20,000 subsidize AAR will grow to $385 million, or the each weekday. This service is vital for the equivalent of nearly 16 cents per mass transit mobility impaired and serves a widely valued ride. mission of the MTA. This report identifies three strategies and eight Although a desirable and important program, specific options that the MTA can pursue to AAR is expensive. In 2015 it cost $461 million improve the financial outlook and the quality and is budgeted at $476 million in 2016. New of paratransit services: York’s program is so expensive because it has a high volume of use and a high unit cost. Among 29 cities with paratransit programs providing 1. Lowering the Cost per Trip. The MTA can at least one-half million rides annually, New lower the average cost per ride by using York had the highest cost per trip—$71 in the lowest-cost transportation option for 2014. It also had the highest number of people each paratransit trip. While more than half registered to use the service even when of all paratransit trips are for ambulatory adjusted for population size—17 per 1,000 customers—persons able to walk and enter residents. and exit the vehicle without a personal aide—the MTA uses wheelchair-accessible This expensive program is financed in an vans and sedans operated by its dedicated inappropriate manner. The cost of assisting service providers for a significant share of those in need ought to be borne primarily these customers’ trips. The MTA could shift through broad based taxes, but only 39 percent these trips to its broker car service (BCS) of AAR’s cost is paid for in this way. The largest program, which uses a for-hire vehicle revenue source, comprising 57 percent of the broker to complete trips using black cars total, is an internal MTA cross-subsidy derived and liveries. These trips cost less than half from the fares, tolls, and dedicated taxes of similar trips on the MTA’s contracted generated by and for New York City subways carriers. Moving all ambulatory customers and buses; put another way, this subsidy is with BCS could save the MTA up to $126 equal to 11 cents for each regular public transit million annually. ride. AAR users are charged $2.75 per ride, and Additionally the MTA could provide these fares cover less than 4 percent of the service more efficiently and improve the costs of the program. customer experience by offering a subsidy Since its budget crisis brought on by the program that allows paratransit users the 2008 recession, the MTA has sought, with opportunity to use the City’s taxicab fleet some success, to reduce AAR costs. Through and Transportation Network Companies more rigorous eligibility guidelines and revised (TNC) like Uber and Lyft. Such a program trip scheduling and dispatch, the agency has would allow customers to reserve a trip for the same day rather than the current
1 practice of requiring reservations a day MetroCards to some AAR customers, though in advance. Though such a program may this program has not been well targeted or induce additional demand, the MTA could well designed to limit abuse. Moreover, the provide a capped subsidy to limit its program is slated to be rolled back, offering exposure, with the paratransit customer half-price trips rather than free trips. If the paying any additional metered fare. If the program were redesigned to limit fraud and MTA were able to replace all current trips encourage wider use of the fixed-route originating within the taxicab “hail zone” in system by paratransit customers and reduce Manhattan—south of 110th Street on the trips 5 percent, the program could save $22 West side and south of 96th Street on the million annually. East side—the agency could save up to $28 million annually. Another option is to offer feeder service, trips that connect users with accessible The MTA could also consider an overhaul fixed-route stops rather than door-to-door of the contracting relationships that make service, in a greater number of appropriate up the paratransit program. By altering its situations. Because such trips are accepted service design and contracting a single, full- less often by customers, this could reduce service broker the MTA could consolidate the number of trips taken and lower the unit the multiple management layers. Placing cost of those trips completed. In 2015 less responsibility with one entity would than 1 percent of trip requests were met encourage more competitive bidding for with an offer of feeder service; increasing service and allow the broker to shift trips this share to 5 percent could save up to $20 to better performing providers. Moreover, million annually. this design could separate the MTA from directly bargaining with service providers and allow for more flexibility in procurement. 3. Changing the Mix of Revenues. The goal of Other paratransit systems have significantly lowering the cross-subsidy from payers of lowered administrative costs under such regular fares is best served by lowering total a system design; if the MTA could match AAR expenses, because the cross-subsidy these systems’ performances, it could save covers the deficit left after other sources are up to $30 million annually. tapped. Thus the options identified above to lower expenses are also key strategies for lowering the internal cross-subsidy. 2. Better Managing Demand. Since 2002 Increased AAR fares are unlikely to become paratransit trips have grown at an average a substantially increased source of revenue. annual rate of 8.4 percent, nearly five times Under the scenario discussed above of the rate of growth of subway ridership. doubling the current fare, $181 million of Though the MTA has employed some the total $184 million in fiscal benefits would successful initiatives to contain paratransit come from the lower cost from eliminated costs by slowing trip growth, more could be rides while about $3 million would come done to better manage demand. One way from a net gain in fare revenue. However the is to discourage excessive use of paratransit MTA may be completing trips that another by charging a higher fare. Doubling the source can fund—the joint federal-state fare could save as much as $184 million Medicaid program that finances medical annually by reducing trips and increasing care for low-income residents. fare revenue; matching the fare of several peer systems instead could save up to $86 Under federal law States must ensure million. Medicaid patients receive necessary The MTA can also reduce demand by transportation to and from medical providing incentives for use of the fixed- providers. In New York City, AAR currently route system by paratransit customers when supplies many of these trips; however, appropriate. The MTA already provides free instead of reimbursing the MTA at a rate
2 similar to other wheelchair-accessible vans, the role of the internal cross-subsidy in taxis, or liveries—as much as $33 per trip— financing AAR. Instead of the projected annual the State will pay only the relevant public growth in trips of 6.5 percent, the goal should transit fare, $2.75. Changing this policy be to keep trip volume flat at the 2015 level. could generate an estimated $14 million Instead of allowing the cost per trip to rise to annually for the MTA. $77, the goal should be to lower it 16 percent to about $65. If these targets are achieved, This report ends with a vision of an improved the necessary City tax subsidy would decline outlook for AAR. A combination of available by $76 million, or 42 percent, and the cross- options could be implemented to achieve the subsidy would decline by $160 million, or the goals of containing the growth in number of equivalent of about 16 cents to 9 cents per trips, lowering the cost per trip, and reducing MetroCard swipe.
3 INTRODUCTION
When most New Yorkers think about public The second strategy recognizes that these transportation they picture buses, trains, enhancements to existing services may not the iconic New York City subway map, or be sufficient to enable many of the disabled Grand Central Terminal. However disabled to use the subway and buses to meet their persons thinking about public transportation travel needs. Additional aid may be necessary often conjure a list of challenges in getting because the nature of their disability prevents themselves and their belongings from one them from using the facilities or because bus part of the city to another—multiple and steep routes or accessible subway stations are not stairways, dangerous platforms, and distant available at their travel origin or destination. To bus stops. In response to many transit systems meet these needs the MTA and other transit inaccessibility, federal and state laws mandate agencies around the country rely on paratransit the widely shared sentiment that public services; that is, special services providing transportation services should be accessible to origin-to-destination service, often with smaller people with disabilities. Nationally and in New vehicles and usually for the mobility impaired, York, public opinion and the law support doing that supplement the fixed-route systems. The the right thing by making mass transit widely MTA’s paratransit program is known as Access- accessible. A-Ride (AAR). It is the focus of this report.
In New York City two basic strategies AAR is a vital service that pursues an important promote this desired goal. First, facilities and and desirable mission. It serves about 144,000 equipment are modified to make existing disabled New Yorkers who take more than 6 services accessible to many of those with million trips annually. Though the MTA has disabilities. Between 1981 and 1998 the taken substantial steps to reduce growth in local public transit agency, the Metropolitan costs, saving the agency nearly $2 billion from Transportation Authority (MTA), converted its projected totals since 2009, the current AAR fleet of about 4,400 buses to be wheelchair- program remains expensive. AAR had a higher accessible.1 In addition in 1984 the MTA began per trip cost in 2014, about $71, than nearly a multiyear program to make 100 of its 469 any other paratransit service in the nation, and subway stations accessible to the disabled by supplies a relatively high number of trips per installing elevators and other features; the 100 capita when compared to other systems. The selected stations were those with particularly high unit cost and volume of service drive total high volumes of users or at key transfer or end expenditures to nearly one-half billion dollars points. So far work has been completed or is annually, more than the combined cost of the underway on 89 of these stations as well as 14 next three largest paratransit systems in the non-key stations; the remaining 11 key stations nation. Moreover, the service is financed in an are to be addressed in the MTA’s 2015-2019 inappropriate manner. Tax subsidies from state capital investment program.2 or local government that should finance the
AAR’s high unit cost and volume of service drive total expenditures to nearly one-half billion dollars annually, more than the combined cost of the next three largest paratransit systems in the nation
4 bulk of the cost cover only about 40 percent; in expenses. The second section provides a fares are a minor share of revenues, about comparative perspective showing the unit cost 4 percent. The MTA is obliged to cover the and utilization of paratransit systems in other remaining share of expenses, more than half, large U.S. cities. The third section presents from other fares, tolls, and dedicated taxes and options for improving AAR’s efficiency, better subsidies. The cross-subsidy is equivalent to 11 managing demand for its services, and altering cents per transit ride.3 its revenue structure. The final section presents potential improved outlooks for AAR based on This report analyzes the challenges of AAR and implementing a combination of the options presents options for making the service more in order to lower unit costs, better manage efficient and more rationally financed. The first demand, and reduce the financial burden on section describes the evolution of the system straphangers. including efforts by the MTA to curb the growth
5 EVOLUTION OF THE SYSTEM
Although the federal Americans with Disabilities 3. Fares that may not exceed twice the fare a Act (ADA) of 1990 is widely regarded as a comparable user of the fixed-route would landmark in promoting transit accessibility, in pay at a similar time of day;7 New York City major initiatives were already underway before its passage. Based on 4. Response time that allows for reservations provisions of the federal Rehabilitation Act of made before the close of business the day 1973 and the New York State Public Buildings prior to a requested trip; Law, advocates pursued litigation to require wheelchair-accessible buses, investments 5. No restrictions or priorities based on the in “key stations” in the subway system, and type of trip or purpose of trip; and new paratransit service using wheelchair lift- 6. No capacity constraints by rationing trips, equipped vans. In 1984 the City, State, and MTA maintaining waiting lists, delaying trips due consolidated these challenges and reached an to untimely pickups, denying substantial agreement with plaintiffs by passing the New numbers of trips, or forcing customers to York State Handicapped Transportation Act. It take part in trips of excessive length.8 stipulated the MTA would make 100 key subway stations fully accessible and that the entire bus The paratransit service may take an eligible rider 4 fleet would be wheelchair-accessible by 2020. from a point of origin to desired destination or In addition the act established a paratransit may be a “feeder” service. For applicable users, committee to study the issue in New York City feeder service provides transportation to and/ and design a paratransit program. In 1987 the or from an accessible bus stop or rail station.9 City began developing a paratransit program, Paratransit providers are expected to provide 5 and service began in 1990. “origin-to-destination” service, which ensures users are able to use paratransit service to get from their point of origin to their point of The ADA and Federal destination even if that requires assistance Standards outside the vehicle. Rather than stipulate “curb-to-curb” service, where providers are The ADA of 1990 required transit systems expected to assist passengers in entering and progressively to make bus and rail systems exiting vehicles, or “door-to-door” service, accessible to persons with disabilities. where providers must assist passengers from Moreover, the ADA recognizes some disabled the entrance of their origin to the entrance persons lack the functional ability to use of their destination, federal rules allow local conventional transit irrespective of accessibility jurisdictions to choose, recognizing certain aids; accordingly, transit agencies must provide individuals may be more suited to one or the an alternative in the form of paratransit other.10 With the exception of trips completed comparable to fixed-route service.6 by taxicab or for-hire vehicle, AAR provides door-to-door service to all registrants rather The Federal Transit Administration (FTA) is than determining the needed level of service responsible for enforcing these requirements for each trip individually. and has set six criteria for paratransit services: Figure 1 illustrates the steps in scheduling and 1. A service area defined as within ¾ mile of dispatching an ADA paratransit trip. Though a fixed-route; each transit agency operates differently, the figure explains a generic model. 2. The same hours and days of service as the fixed-route;
6 Figure 1: Basic Scheduling and Dispatching Operation of a Paratransit System
Schedule Ride Dispatch Vehicle Pick-Up Rider Take Rider to Destination t t h t t h t t h h t t h , t h t t t th may pick up additional th t t h th t location, and the driver riders and then drop off reservation center to t h t h t th th t th t h t t h t th th h mined destination. pick-up location.
o e General Accountability Office, ADA Paratransit Services: Demand Has Increased, but Little is Known about Compliance, GAO-13-17 (November 2012).
Transit agencies must establish a process for would not be fully effective until 1997, but determining eligibility; however, neither the compliance would require changes in the New ADA nor the FTA stipulates a method for doing York City service. so. Most agencies use some combination of self- certification, medical professional verification, In May 1993 the City and the MTA agreed to in-person interviews, and in-person functional transfer AAR to the MTA in July of that year. As and cognitive assessments.11 part of the transfer agreement, State law was amended to dedicate a portion of the Urban Tax (a tax on certain real estate transactions in Access-A-Ride’s Founding and New York City) to the MTA for its paratransit Transfer to the MTA program, and the City committed to annual appropriations to the MTA to support AAR. New York City’s paratransit program, AAR, The City’s subsidy was set at one-third the operating deficit of AAR with a cap of 120 was operated by the municipal Department 13 of Transportation and began service in percent of the previous year’s appropriation. January 1990 in compliance with the State’s The MTA sought to bring AAR into compliance Handicapped Transportation Act. The program with federal requirements. From 1992 to 1996 offered door-to-door service in wheelchair total trips grew from 297,000 annually to lift-equipped vans, operating from 7 a.m. to 575,000. Over this period program costs grew 7 p.m. on weekdays and 10 a.m. to 6 p.m. on from $10 million to $23 million annually, and weekends and holidays. In 1991 the program the average cost per trip increased from $34 cost the City $12 million for 225,294 trips, and to more than $40. (See Figure 2.) in 1992 cost $10 million for 297,462 trips.12 However, the City’s program did not meet the 1997 to 2008: Mushrooming federal ADA standards for paratransit service comparable to fixed-route service. First, AAR Growth operated on limited hours, not 24 hours a day like New York City’s subway and bus systems. Beginning in 1997, AAR experienced 12 years Second, the City’s program denied a large share of extraordinary growth. Ignited by expanded of trip requests owing to capacity constraints; ADA regulations, registrants grew by a factor from 1990 to 1992 AAR denied almost one of 3.6; completed trips and contracted vehicles in five trip requests. These denials were not in service grew by a factor of 9.4; and total permitted under ADA regulations. The ADA expenses grew by a factor of 15.8.14 (See also placed responsibility for paratransit with Figure 3.) local transit agencies; in New York City this was the MTA rather than the local Department The first major change occurred when federal of Transportation. Federal ADA standards courts ruled ADA paratransit service must ensure all eligible individuals can obtain a
7 Figure 2: Access-A-Ride Completed Trips and Expense, 1990 to 2015
Total Expense To al T (trips in millions) (expenses in millions)
1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015
Note Data for 1990 total expense not available; data for 1993 total trips estimated. o e Metropolitan Transportation Authority, Adopted Budget, February Financial Plan (annual editions 2009 to 2016), Paratransit Operations; data provided by Metropolitan Transportation Authority, Paratransit ivision;d City of New York, Mayor’s Management Report (annual editions 1990 to 1993), Department of Transportation, Missions and Indicators, and Executive Budget, Supporting Schedules (annual editions 1990 to 1993).
Figure 3: Access-A-Ride Selected Operating Statistics Indexed, 1994 to 2015 (1994 = 100)
Expense T Vehicles Registrants
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
o e Metropolitan Transportation Authority, Paratransit Division, email to Citizens Budget Commission staff (May 23, 2016).
8 paratransit reservation at any time fixed-route eased the need to increase the number of service is available.15 For the MTA this was contracted vehicles. By 2006 the City of New particularly onerous, as the transit system York Independent Budget Office calculated the operates 24 hours a day, 365 days a year. use of taxicabs and liveries helped AAR reduce Complying with this ruling led to an increase costs by 7 percent.18 in the share of trip requests completed from 68 percent in 1998 to 76 percent by 2000. To Even with these efforts, AAR expenses meet this increase in completed trips the MTA continued to grow. From 2002 to 2007 the increased the size of the paratransit fleet to program’s cost grew at an average annual rate meet 100 percent of demand and contracted of nearly 17 percent. The MTA’s financial plans additional vehicles to anticipate future capacity began referring to AAR as an “uncontrollable needs. From 1996 to 2000 the MTA more than cost.”19 As the 2008 recession upended public tripled the number of vehicles in service from sector budgets, the MTA faced a paratransit 201 to 633. Improving service led to lower budget projected to double again by 2011. productivity when measured as the number of AAR trips completed per hour of service. In 1996 AAR completed 1.29 trips per hour; by 2009 to 2016: Reining in Costs 2000 that had fallen 24 percent to 0.98 trips per hour of service.16 By 2009 paratransit growth was unsustainable: AAR costs had grown 56 percent over two years A second major regulatory change occurred in and subsequent updates to the MTA’s financial 2001 after a legal settlement further limited the plan anticipated paratransit expenses to grow MTA’s flexibility by requiring paratransit travel to $913 million by 2014. Public budget crises times comparable to the public transit system. brought on by the 2008 recession magnified In order to meet these guidelines, the MTA the need to reform the paratransit program. had to purchase additional vehicles and pay contractors for the additional hours needed The MTA’s 2009 budget included a paratransit to complete the same number of trips in a savings plan that proposed cutting costs and more timely fashion, decreasing the service’s raising revenues to save $57 million. This efficiency. Between 2000 and 2002 AAR proposal included doubling paratransit fares, productivity fell another 7 percent, dipping reforming cancellation and no-show policies, below 0.92 trips per hour of service.17 expanding use of taxis and for-hire vehicles, and renegotiated rates with contracted 20 As paratransit service improved, growing carriers. However, the MTA struggled to meet 21 demand required more vehicles, which its savings target. The 2010 budget included involved expanding carrier contracts. new targets; $40 million in 2010 and $80 22 New carrier contracts exposed the MTA million annually thereafter. This commitment to renegotiated reimbursement rates and began paying dividends saving more than $230 increased vehicle maintenance and insurance million annually by 2012. (See Table 1.) costs. In response, the MTA began shifting some trips from the dedicated vehicles under The largest savings, $107 million, came from contract to other carriers. Beginning in 2002 reduced trips, which the MTA attributes to a AAR began supplying paratransit trips for closer alignment with ADA eligibility guidelines ambulatory customers with taxicabs, liveries, and converting trips to fixed-route service. and black cars. At that time, more than three- Converting more trips to taxicabs saved $34 fourths of paratransit registrants did not million, and fleet reduction savings from require a wheelchair lift-equipped vehicle, and reduced insurance costs and fewer vehicle delivering service with a lower-cost sedan met purchases saved $24 million. Changes to carrier ADA guidelines and saved money. Particularly contracts—the termination of two carrier during peak demand, shifting appropriate contracts and a paratransit rate reduction customers to taxicabs and liveries allowed applied to all other carriers—combined the MTA to provide service more cheaply and saved more than $40 million. A variety of administrative efficiencies and other initiatives
9 Table 1: Access-A-Ride Cost Reduction Initiatives, 2011 and 2012
2011 2012
e e 69.8 106.8 In ea e ha e of non- C 14.1 33.5 Flee e tion 8.1 24.2 Pa a an a e e tion 19.7 23.6 A n ati e effi en e 13.4 21.4 Te nation of wo a e on a 8.0 15.9 No- how e tion 8.1 4.2 nfo e en of 3 4 le A A e e 1.6 1.5 Total Cost Reduction 1 2 8 2 1 1
No e e e a o a e w h tigh ene el g l y o e e an he n o tion of fee e e e an he e en on e on of o he fixe - o e y e . Flee e tion a ng o e f o e e n an e o an fewe eh le ha e . A n ati e effi en e n l e o e all en e an el g l y e tifi ation on a , a well a e e o e hea an eh le eha l ation ex en e .
o e e o ol an T an o ation A ho y, Pa a an on, e a l o C tizen B ge Co on aff J ne 7, 2016). account for the remainder. With these efforts to 144,692 in 2016, down 15 percent from the and continued vigilance in identifying and program’s peak of 170,140 five years earlier.23 implementing paratransit savings, the MTA has made AAR less costly. By the end of 2016 the The second policy change is the introduction agency expects to have reduced its projected of feeder service.24 In 2010 the MTA began annual paratransit expense by more than $850 scheduling paratransit trips that either million, with cumulative savings approaching originated or terminated at bus stations. This $2 billion. trip-by-trip screening and extension of feeder service resulted in significant savings in two Two policy changes have been instrumental forms. First, feeder service reduced vehicle to these results. The first is the expanded service hours by generating shorter trips; use of in-person assessments to determine these savings are often modest. For the nearly eligibility. Prior to 2007, the MTA required only 10,000 feeder trips completed in 2015, the selected applicants to visit eligibility centers MTA estimates a one-third reduction in vehicle for an in-person assessment: applicants service hours. Assuming these trips replaced requesting personal care attendants (PCAs), average trips in terms of vehicle service hours applicants with cognitive disabilities, applicants this represents $125,000 in savings.25 Second, recertifying, and children. These applicants the offer of a feeder trip is more likely to be represented approximately half of the total. turned down by registrants than a door-to- Beginning in 2007, all applicants were door trip. While other factors may be involved, required to perform an in-person assessment the share of requested trips not scheduled with a certified professional at the eligibility increased from 6 percent in 2009 to 11 percent determination unit, providing more scrutiny to in 2010 when AAR introduced feeder service, the eligibility process and an increase in denials. a drop of an estimated 336,000 trips.26 (See From 2005 to 2009 AAR denied 6.5 percent of Figure 4.) In 2015 the MTA recorded 34,014 applicants; from 2010 to 2013 the rate more feeder trips refused, representing an estimated than doubled to 13.6 percent. Wider use of in- $2 million in savings.27 Since its inception, person assessments helped reduce registrants feeder service has saved the MTA $30 million in
10 Figure 4: Access-A-Ride Trip Requests, Share Not Scheduled, 2004 to 2015 To al e e Share of Requests not Secheduled
14 13 11 11 1 1
7 6 6 6 6 6 (total requests in millions)
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
o e Metropolitan Transportation Authority, Paratransit Division, email to Citizens Budget Commission staff (May 23, 2016).
direct costs, which does not include dampened increased 3.2 percent in 2012 but have fallen demand on trip requests.28 each year since, totaling less than 6.4 million in 2015. Total paratransit expense growth The MTA expected a third initiative, the Zero- has slowed, averaging 0.8 percent annually Fare MetroCard program, to further reduce since 2009. Despite these trends, the MTA trips and costs. First proposed in 2012 in anticipates faster growing costs in the future. a consultant report, the program seeks to encourage use of mass transit rather than individualized paratransit service whenever Access-A-Ride Today feasible by offering registrants free use of the fixed-route system.29 The MTA planned to issue Currently AAR offers shared-ride, door-to- Zero-Fare MetroCards to all AAR registrants, door, and feeder paratransit service 24 hours eventually using the card as a customer’s primary a day, 365 days a year and provides service identification for AAR services; however, the to a corridor within three-quarters of a mile agency has pared back this goal, instead issuing from the local bus and subway system through Zero-Fare MetroCards only to AAR registrants New York City and in portions of Nassau and who request them. Citing the consultant’s Westchester counties. Customers pay the report, the MTA expected to reduce paratransit single-ride transit fare—currently $2.75—to use demand by 15 percent.30 While the growth in the system and may travel with a pre-approved trips has slowed since the introduction of the personal care attendant (PCA) free of charge. Zero-Fare MetroCard in 2013, it is unclear how Customers may also travel with additional much of this deceleration is attributable to this guests as can be accommodated on a case-by- program. Moreover, in its July 2016 financial case basis; guests must pay $2.75 to ride. plan the agency has proposed changing the program from a Zero-Fare program into a To apply for AAR potential registrants reduced fare program.31 schedule an in-person assessment at one of six eligibility centers where they undergo an After increasing 43 percent from 2007 to interview or a functional test with a health care 2009, paratransit trips grew a more modest professional, or both, to determine their ability 6.2 percent in 2010 and decreased 2.5 percent to use the fixed-route system. The eligibility in 2011. (Refer to Figure 3.) Completed trips determination unit, staffed by physical and 11 occupational therapists, reviews assessments subcontract with black car and livery providers. and verifies whether or not an applicant meets In 2015 BCS completed nearly 1.3 million trips, the requirements for either full or conditional approximately one-fifth of all paratransit trips. eligibility, which is only for times when certain The third type is taxicabs and independent conditions limit travel on a fixed-route such as liveries and black cars, which the MTA uses to weather or navigational conditions.32 Eligibility supplement service for ambulatory customers. may be continual, meaning a condition is The majority of these trips are approved for permanent and the customer is not required reimbursement, meaning customers pay the to reapply, or temporary, for customers with appropriate fare—metered in the case of short-term limitations. With the exception of taxicabs or street-hail liveries (“green cabs”) those with continual eligibility, all registrants or negotiated in the case of black cars and must recertify their eligibility every five years.33 liveries—and AAR reimburses the customers this amount less the paratransit fare ($2.75). To schedule service, customers call to reserve a In 2015 this third category of providers was trip from one to two days in advance between responsible for nearly 400,000 trips, about 6 7 a.m. and 5 p.m. and provide a preferred percent of the total.35 pickup time or an appointment time—the time a customer wishes to arrive at his/her DSC contracts include variable payments destination. The MTA also accepts reservations based on the amount of time a vehicle is online. For some trips, a reservation may not in service, fixed payments for maintenance be scheduled immediately; in these cases, AAR of paratransit vehicles, and fixed payments collects additional requests before bundling associated with a firm’s overhead. BCS brokers trips together into the most efficient routes and their subcontracted drivers receive per- possible. Customers receive a response by trip payments determined using a zone-based 7 p.m. with their pickup time. Moreover, rate schedule.36 The MTA purchases wholesale customers may be denied door-to-door service fuel and insurance coverage on behalf of DSCs and instead offered feeder service. according to the number of vehicles contracted. In addition, the MTA employs 213 direct AAR provides its services through a employees who administer AAR, primarily by constellation of for-profit and not-for-profit monitoring contractor performance.37 contractors. Separate contracts govern AAR’s eligibility determination unit, command center AAR’s 2015 expenses of $462 million were which receives trip requests and designs divided among paratransit service contracts, schedules and routes, and carriers that personal services, and other than personal complete these routes.34 Though the transit services. (See Table 2.) Paratransit service agency owns vehicles used by its contracted contracts account for 81 percent of the total carriers, the maintenance of these vehicles is and include carrier services ($347 million), the responsibility of the carrier. command center ($26 million), and eligibility certification and other ($3 million). Personal AAR engages three types of contracted carriers. services totaled $21 million and funded the The first type are dedicated service carriers 213 paratransit staff at the MTA. Other than (DSC), for-profit and not-for-profit firms that personal services totaled $61 million and operate specifically equipped vans and cars included general liability insurance ($36 million), purchased and owned by the MTA that are fuel ($14 million), and other expenses ($11 solely dedicated to delivering paratransit million), mostly related to various professional service. In 2015 the MTA contracted with 15 services to support AAR. separate DSC firms to complete 4.7 million trips, approximately three-fourths of total paratransit AAR is supported with four revenue sources. trips. The second type are broker car services Fares collected from customers and their guests (BCS), which consist of two brokers responsible totaled nearly $18 million in 2015 and covered for scheduling and dispatching paratransit 4 percent of total program cost. Receipts from trips for ambulatory customers. BCS brokers the City’s Urban Tax, a combination of real
12 Table 2: Access-A-Ride Expenses and Revenues, 2015 to 2020 (dollars in millions)
201 2016 2017 2018 2019 2020 CAGR E penses 62 76 16 92 6 6 8 0 Pe onal e e 21 24 24 24 24 24 0.0 O he Than Pe onal e e 61 60 81 83 96 111 16.3 Insurance 36 39 44 50 59 69 15.1% Fuel 14 11 13 14 16 19 13.5% Other 11 10 24 19 21 23 23.5% Pa a an e e Con a 379 391 411 435 472 511 7.0 Carrier Services 347 356 374 395 430 465 6.9% Command Center 26 26 28 31 34 37 9.4% Eligibility Certification, Other 3 8 9 9 9 9 1.7% Re enues 62 76 16 92 6 6 8 0 Fa e e en e 18 18 20 21 22 24 6.7 an Tax 63 58 54 53 53 56 -1.1 C y e e en 124 127 141 150 165 182 9.5 TA C o - y 256 272 301 319 351 385 9.0
Source: Metropolitan Transportation Authority, 2017 Preliminary Budget, July Financial Plan 2017-2020 (July 2016), Paratransit Operations, p. III-18, Pa a an on, e a l o C tizen B ge Co on aff J ne 21, 2016). estate transfer and transaction taxes on certain this capital plan, the MTA shifted its purchasing properties in New York City, totaled $63 million strategy, investing in lower-cost vehicles than or 14 percent of total program costs. The third AAR’s traditional lift-equipped vans. Under this source is the subsidy from the City of New procurement reform, the MTA will be able to York, which in 2015 was $124 million or 27 fund future vehicle purchases through AAR’s percent of program costs. operating budget.
The fourth and largest source is an internal MTA cross-subsidy—revenues generated by The Outlook to 2020 other agency activities, as well as dedicated taxes necessary to balance the paratransit The MTA’s latest financial plan anticipates budget. This cross-subsidy totaled $256 million significant growth in AAR trips and expenditures in 2015, more than half of total AAR costs. This through the end of the financial plan period. sum is equal to 11 cents per MetroCard swipe, Trips are projected in increase by 7.4 percent or 6.3 percent of the average fare revenue per in 2017 and thereafter 6.5 percent annually transit ride.38 The heavy reliance on this cross- with expenditures reaching $646 million in subsidy underscores the impact of the AAR 2020.39 (Refer to Table 2.) Since trip volume program on the rest of the MTA’s financial plan. is the major driver of expenses, it is important to assess the reasonableness of the assumed In addition to operating expenses and revenues, growth rate of 6.5 percent. A case can be made AAR requires capital outlays. The MTA’s capital that this rate is too high. Since 2009 trips have program includes purchases of paratransit grown at an average annual rate of 0.3 percent, vehicles for DSCs to operate. In the 2010- and a shift to steady growth after seven years 2014 capital plan period, the MTA purchased of relative stability could be questioned. But a 192 paratransit vehicles for $9.4 million. During
13 case an also be made that the assumed rate is Urban Tax receipts are expected to fall 8 percent appropriate. The recent stability is the result of in 2016, 6 percent in 2017, and 3 percent special efforts to limit eligibility and trips that in 2018 owing to the cyclical nature of this may have had a one-time effect; moreover, revenue source and larger-than-expected real absent new policy initiatives and given the estate tax receipts in New York City in 2015. maturing of the large baby boomer cohort, a The MTA conservatively estimates Urban Tax return to the double-digit growth of previous receipts will remain flat in 2019 and grow 4 years is plausible. Given these uncertainties, percent in 2020. However, a downturn in the the 6.5 percent figure appears reasonable, local economy, particularly if such a downturn but is subject to wide variations in the coming has an outsized effect on commercial real years. estate, can lead to significant decreases in Urban Tax receipts. For example, following the Total expenses are expected to grow an historically harsh 2008 recession Urban Tax average of 8 percent annually, mostly driven receipts fell 84 percent. The dynamic nature of by average annual increases in carrier services Urban Tax revenues affects the City’s subsidy. of 6.9 percent. While carrier expenses largely Direct payments from the City are expected to track trip growth, DSC payment rates include grow at an average annual rate of 9.5 percent. adjustments for cost of living increases, leading to expense growth above 6.5 percent. Despite significant increases in fare revenue Insurance and fuel are expected to increase at and the City subsidy, the necessary internal relatively high average annual rates, 15 percent MTA cross-subsidy will also grow notably. and 14 percent respectively. As a variable cost, Annual average increases of 9 percent are fuel expense follows trips completed but is needed, bringing the sum to nearly $385 million also a function of wholesale fuel prices, which in 2020.41 In that year the cross-subsidy would have fallen from 2014 levels, but that the equal about 16 cents for every MetroCard MTA conservatively assumes will rebound in swipe on the subways and buses. the future. Insurance premiums are expected to grow as rates increase and as the MTA The MTA is seeking to keep the cross-subsidy increases the number of vehicles contracted to down by finding ways to lower AAR expenses. meet increasing demand. The agency’s July 2016 financial plan highlights fuel savings, lower insurance, and lower Other expenses are expected to more than scheduling and certification costs to help double in 2017, from $10 million to $24 reduce paratransit costs by an additional $58 million, as the MTA will begin funding vehicle million cumulatively from 2017 to 2020. The purchases through the operating budget. These MTA expects to meet these savings goals by expenses are expected to decrease 18 percent more closely aligning with requirements of the in 2018 before increasing at an average rate of ADA.42 However, even if this goal is realized, 9 percent through 2020. the necessary cross-subsidy from transit would still be equal to about 15 cents per ride. Fare revenue is projected to grow 6.7 percent annually. This projection assumes the MTA In brief, the current fiscal problems of AAR are keeps the base transit fare at $2.75 during the projected to worsen. The high rate of utilization agency’s planned fare increases in 2017 and likely will grow, the cost per trip will increase, 2019.40 and the cost burden imposed on the rest of the transit agency, and by extension regular subway and bus riders, will become greater.
14 A COMPARATIVE PERSPECTIVE
New York City’s extensive transit network Table 3: Paratransit Registrants makes comparative analysis difficult. New per 1,000 Residents in Service Area York’s 469 subway stations dwarf the total Population, Selected Systems, 2014 for the next largest number in the United States—146 in Chicago—and the bus system’s Registrants per 1,711 directional route miles could stretch from 43 1 000 Ser ice Midtown Manhattan to Atlanta and back. Registrants Area Residents New York City is both the nation’s largest Metropolitan Statistical Area by population New York 1 692 17 0 and has the largest share of residents using Bo on 68,000 16.3 public transportation to commute to work, an F an o 13,457 16.1 30.4 percent, or six times the national share.44 The ridership is immense: 2,500 passengers nnea ol - . Pa l 35,000 15.1 boarded New York’s subways and local buses Po lan , O 23,135 15.0 in the time used to read this paragraph. The scale and pervasiveness of transit in New onol l 14,305 15.0 York is a major reason AAR completes more o Angele 163,000 14.0 trips than the paratransit programs in Boston, Philadelphia, Washington D.C., and New Jersey a - a e Co n y 32,772 13.1 combined. Oaklan 17,419 12.2 a ylan a ew e) 25,000 11.3 Nonetheless, comparative analysis can be instructive. Fully 28 other transit agencies Ch ago 72,000 10.9 in the United States completed at least one- O ange Co n y, CA 32,256 10.6 half million paratransit trips in 2014 including 14 with more than 1 million annually.45 With a h ng on, .C. 38,900 10.5 appropriate adjustments for population size a ega 17,616 8.8 and regional cost factors, comparisons among this group can be meaningful. Three key en e 24,260 8.4 findings emerge from this analysis: (1) AAR has Fort Lauderdale 14,315 7.8 a relatively high volume of registered users and eattle 14,690 7.3 utilization per capita; (2) AAR’s cost per trip is unusually high; and (3) AAR has relatively an An on o 12,705 7.1 low productivity based on a frequently used A tin 5,438 5.0 indicator. alla 11,500 4.9 High Utilization Ph la el h a 14,124 4.2 o on 16,491 4.1 In New York a larger share of the population is an Jo e 7,095 3.8 registered to use paratransit than in any of the New Je ey a ew e) 21,000 1.1 other cities with large paratransit services. With
144,692 registrants, AAR has 17 registrants Source: U.S. Department of Transportation, Federal Transit Administration, for every 1,000 service area residents, highest National Transit Database (updated January 2015); and registrant data from among the 29 peer systems. (See Table 3.) AAR FTA ADA compliance reviews and various reports issued by transit agencies. also has the fifth highest number of paratransit
15 trips per capita, completing 759 trips per 1,000 Two factors that might be expected to influence residents in 2014, 49 percent higher than this measure of productivity do not appear to be the median for all large systems. Though the the source of AAR’s relatively low productivity. number of disabled persons and seniors living First, average trip length affects the number of in a region may affect paratransit registration, trips a vehicle can complete in a service hour; the data suggest this is not the cause of the a longer distance will take more time. Among MTA’s relatively high number of registrants: the 29 systems, longer trips correlate with the share of seniors—individuals older than lower productivities, but AAR’s average miles 64—residing in the MTA’s service area is 12.2 per trip of 9.6 is the 5th lowest. The 4th and percent, slightly below the median for all large 6th ranked systems, Orange County, California systems, and the share of disabled persons and Chicago, traveled an average of 9.5 miles residing in the MTA’s service area is 10.3 and 9.6 miles per trip and recorded 48 percent percent, the median for all large systems.46 and 28 percent higher productivity than AAR, respectively.49 One possible alternative explanation for the higher number of registrants in the service area Second, the degree of traffic congestion in an is that the AAR service area covers a larger urban area might influence productivity; more share of the city’s land area than is the case congestion would likely yield slower traveling for other systems. In addition it is possible that speeds, increasing the number of service hours paratransit is more heavily used in New York required to complete trips. However, data City because disabled persons have fewer on congestion compiled by the Texas A&M mobility options than in other places. For Transportation Institute does not support example, relatively few social service programs this hypothesis. Among the 29 peer systems provide paratransit service in the city, and car studied, higher placement on the Travel Time ownership is significantly lower than in other Index correlates with higher productivity.50 major metropolitan areas, which may impede other types of ridesharing with family members Two other factors may contribute to AAR’s low or friends.47 productivity compared to its peers. First, unlike any other system, AAR operates 24 hours a day. Based on data from 2014, the latest year for While traffic congestion may fall at night, fewer which comparative data are available, AAR’s riders means the paratransit system is less able cost per trip of more than $70 is the highest in to combine trips and maximize efficiency while the nation and well above second place New completing overnight trips. Second, the ADA Jersey Transit at $63. (See Table 4.) Adjusting requirement to keep paratransit travel times for regional cost differences makes AAR only comparable to public transit trips is an added slightly less an outlier; it falls to second place challenge in New York City, where bus and behind only Austin, Texas but still well above subway headways can be significantly smaller other large cities such as Chicago, Los Angeles, than other transit systems.51 and Washington, D.C. While AAR operates in a unique transit environment, it is still much more expensive Low Productivity than other systems that also must navigate dense and congested urban regions. Given AARs’ high cost per trip is related to low these findings, the MTA should pursue policies productivity. A commonly used measure of and practices that will make AAR more cost- paratransit productivity is the number of trips effective. completed per hour of service. On this indicator AAR ranked 26th of the 29 systems. (See Figure 5.) AAR’s productivity of 1.23 trips per revenue hour was lower than all but Boston, Washington, D.C., and Denver and only 77 percent of the median for all large systems.48
16 Table 4: ADA Paratransit Trips, Expenses, and Cost per Trip, 2014 ADA E penses ADA E penses per Trip ADA Trips n ll on ) Actual Adjusted New York 6 8 1 6 70 77 7 86 Ch ago 4,068,918 156 38.23 35.87 o Angele 3,751,555 124 33.12 28.14
a ylan a ew e) 2,288,803 86 37.49 33.80 a h ng on, .C. 2,126,461 106 49.60 41.40 nnea ol - . Pa l 1,905,563 53 27.84 27.11 Bo on 1,868,149 110 58.99 53.19 a - a e Co n y, FL 1,679,570 46 27.26 25.91 o on 1,662,261 49 29.47 29.30 O ange Co n y, CA 1,356,635 64 46.82 39.78
New Je ey a ew e) 1,271,302 80 63.19 55.19 a ega 1,087,762 45 41.06 41.39 eattle 1,081,469 62 57.59 55.80 onol l 1,026,711 41 39.47 32.22 Ph la el h a 1,011,560 31 30.86 28.60 an An on o 987,737 32 32.34 34.37 alla 803,255 32 40.19 39.87 Po lan , O 802,970 28 35.14 34.90 an F an o 771,114 20 25.41 21.12 Palm Beach County, FL 760,750 21 28.09 26.70 Oaklan 706,491 37 52.69 43.44 en e 696,415 39 55.47 52.93 Delaware (statewide) 651,680 37 56.94 56.15 Atlanta 583,950 29 49.33 51.82 Suffolk County, NY 571,997 27 46.92 40.70 A tin 550,309 33 60.53 61.33 St. Louis 548,965 23 42.41 47.28 an Jo e 523,195 20 38.20 31.76 Fort Lauderdale 518,513 12 23.75 22.58
Note: Adjusted cost per trip divides the cost per trip divides by the Regional Price Parity for the associated area. Regional Price Parities measure the differences in the price levels of goods and services across states and metropolitan areas for a given year, and they are expressed as a percentage of the overall national price level. Source: U.S. Department of Transportation, Federal Transit Administration, National Transit Database (updated January 2015); and U.S. Department of Commerce, Bureau of Economic Analysis, “RPP1, Regional Price Parities” (accessed June 15, 2016).
17 Figure 5: ADA Paratransit Trips per Vehicle Hour, Selected Systems, 2014
D s S n Fr n is o Hono P e h Co nt FL Port n OR Or nge Co nt CA De w re st tewi e Minne po is-St. P S n Antonio M r n st tewi e St. Lo is Fort L er e Ho ston Mi i-D e Co nt L s Veg s Chi go S n ose Seattle O n Phi e phi Los Ange es New erse st tewi e Austin At nt Suffolk County, NY New York oston shington D.C. Den er
0.00 0.50 1.00 1.50 2.00 2.50 3.00
Note: Productivity derived from “demand response” and “demand taxi” total hours of operation divided by ADA trips. For transit agencies supplying demand response and demand taxi trips for non-ADA participants, the share of ADA expenses to total expenses used to estimate share of ADA total hours of operation. o e U.S. Department of Transportation, Federal Transit Administration, National Transit Database (updated January 2015).
18 OPTIONS FOR IMPROVING EFFICIENCY AND FINANCING
Though AAR costs have remained below projected levels since 2010 and are on pace Lower Cost per Trip to decline in 2016, the program remains the Although the MTA has had some success in most expensive in the country owing to high containing AAR expenditures, the gains have unit costs and high utilization. Moreover, resulted almost entirely from lowering the its financing places a burden on users of the projected volume of trips rather than lowering regular mass transit services rather than being the cost per trip. As shown in Figure 6, the more heavily supported by fares and general tax $72.65 cost per trip in 2015 is the highest ever subsidies. Each of these problems is projected and is 4.5 percent above the figure for 2009 to worsen in the coming years. when serious cost containment measures were Given this troubling outlook, the MTA should initiated. Taking into account general price pursue three strategies to improve AAR’s inflation improves the trend somewhat, but the efficiency and financing—lower the cost per constant dollar (in 2015 dollars) cost per trip trip, better manage demand for the service, has remained within the range of $66 to $77 and shift revenues from an internal cross- since 2003. subsidy to other sources. Table 5 summarizes the estimated savings from eight options falling Increase Use of Broker Car Service. One in these three categories. way to increase efficiency is to ensure the least expensive type of appropriate vehicle is
Table 5: Estimated Ranges of Savings for Options to Improve Efficiency and Effectiveness of Access-A-Ride (dollars in millions) Estimated Sa ings Low High Lower Cost Per Trip Co le e All A la o y T w h B oke Ca e e 29 76 Provide Taxicab and For-hire Vehicle Subsidy Program 28 37 o e P o ti e e e f o F ll- e e B oke age y e e gn 25 30 Better Manage Demand o le Fa e 71 184 a h Fa e o Pee 20 86 In ea e e of F xe - o e y e w h Zero-Fare e oCa P og a 11 22 In ea e e of Fee e e e 9 20 Shift Re enue Sources e a e e en fo Non-e e gen y e al T an o 3 14
Source: Savings estimated by CBC staff using 2015 operating results. See text and endnotes for explanations.
19 dispatched to complete a trip. Not all AAR users one-quarter of all trips are completed with are the same; though the MTA distinguishes non-carrier modes and more than half of all between trips requiring a wheelchair- paratransit trips are completed by ambulatory accessible vehicle and trips that may be customers. Approximately 1.1 million trips, completed with a sedan, each may require 17 percent of the 2015 AAR total, do not either curb-to-curb or door-to-door service. require door-to-door service and likely could The MTA meets the needs of its customers by have been completed by a less-expensive, yet providing three types of service: conventional, appropriate, carrier.55 door-to-door paratransit completed by DSCs using wheelchair-accessible vans or sedans, Shifting appropriate customers from a DSC trips by black cars and liveries associated with provider to a BCS provider could save between one of two BCS brokers, and taxicab trips pre- $24 and $69 per trip on carrier services using approved on a case-by-case basis.52 2015 figures. Moreover, the MTA could gain fuel cost savings by shifting these trips to BCS, Table 6 shows the distribution of AAR trips by as black car and livery operators pay for their carrier type since 2008 and the 2015 average own fuel. Using 2015 trip totals as a base, cost per trip by type. In 2008 non-DSC services each 1 percent of rides shifted from DSCs to accounted for 8 percent of all trips. This share BCSs would save between $1.7 million and grew as high as 37 percent in 2012 but has $4.5 million in carrier service and fuel costs. 53 since declined to 26 percent. While the Eliminating the nearly 1.1 million ambulatory, average DSC trip cost about $66 in 2015, rates curb-to-curb eligible trips completed by DSCs vary based on the DSC. According to a report could save between $29 million and $76 from the City Comptroller, per trip rates ranged million.56 from $47.57 to $92.15 per trip or between 2.0 and 3.9 times the cost of the average BCS Additionally, the New York City Taxi and trip and between 2.8 and 5.5 times the cost Limousine Commission (TLC), which licenses of the average taxicab trip.54 Approximately taxicab, for-hire vehicle, and paratransit vehicle
Figure 6: Access-A-Ride Cost per Trip, Current and Real Dollars, 1994 to 2015 (real dollars in 2015 dollars)
Current Cost per Trip Real Cost per Trip
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
o e Metropolitan Transportation Authority, Paratransit Division, email to Citizens Budget Commission staff (May 23, 2016); and U.S. Department of Labor, Bureau of Labor Statistics (accessed May 16, 2016), Consumer Price Index-All Urban Customers, CUURA1015A0.
20 Table 6: Share of Access-A-Ride Trips by Carrier Type, 2008 to 2015
201 Direct 2008 2009 2010 2011 2012 201 201 201 Cost per Trip e a e e e Ca e 92 91 86 73 63 65 71 74 66.09 Tax a 8 9 14 17 17 12 7 6 15.76 B oke Ca e e 10 20 23 22 20 23.68 Total Trips (in millions) 6 6 8 6 6 6 8 6 7 6 6
Note: "Taxicab" includes black car and livery trips purchased with a voucher, and not booked through AAR's broker car service. Source: Staff of Metropolitan Transportation Authority, Paratransit Division, briefing to Citizens Budget Commission staff (April 25, 2016), and email to Citizens Budget Commission staff (June 23, 2016). drivers, could require all BCS drivers to provide vendor at the time ended its prepaid card door-to-door paratransit when applicable. program, and the transit agency was unable Doing so would allow the estimated 702,000 to replicate the prepaid card structure with ambulatory trips that may require door-to-door another bank owing to customer privacy laws service to use BCS as well, saving up to an and know-your-customer rules. Rather than additional $50 million. allowing a bank to issue cards directly to AAR customers, the MTA ended the program.57 Other jurisdictions, including Chicago and Taxicab and For-hire Vehicle Fare Subsidy Denver, have also instituted programs like Program. Another way the MTA could promote these, issuing vouchers to registrants to the use of more efficient modes is to establish redeem with taxicabs or other for-hire vehicles. a subsidy program for AAR trips completed by Like taxi service, a trip using Transportation taxicabs and other for-hire vehicles. In such a Network Companies (TNCs)—such as Uber program, paratransit registrants would be able or Lyft—may fit this model, lowering costs and to hail a cab or secure a black car or livery improving access for paratransit service. A pilot without reserving the trip in advance. The user program in Boston will offer a debit card that would be responsible for paying the normal works with Uber. The agency hopes to improve paratransit fare and the MTA would pay any service by providing paratransit customers with metered fare above this amount. This subsidy the flexibility of same-day booking as well as a would be delivered via a special debit card, way to track vehicle rides.58 More than lowering voucher issued to the registrant in advance, or unit costs, tapping into TNCs’ networks can other fare media the MTA procures as part of a provide the MTA with private sector software new fare payment system. platforms that may be able to more efficiently From 2010 to 2015 the MTA offered a similar deploy vehicles than its own systems, as well as 59 service to selected customers based on their more easily adapt to new technologies. frequent use of certain trips, mostly those The estimated average metered taxi fare in with regular trips to work and patients with 2015 was $20.79 per trip. If the MTA created recurring medical appointments for treatment a subsidy program for taxi trips whereby such as renal dialysis. AAR pre-approved customers paid the AAR fare ($2.75) and the participants and issued them prefunded debit MTA paid the remaining metered fare (on cards to use in taxicabs. Every two weeks the average approximately $18), the per trip cost registrant would be billed the paratransit fare would be lower than for DSCs or black cars or for each trip taken with the debit card and liveries operated through BCS. Assuming all of have their debit card recharged. Customers the 11 percent of AAR trips originating within gained flexibility and the MTA achieved savings the taxicab “hail zone” in Manhattan—south of on these trips. Despite its success, the MTA’s
21 110th Street on the West side and south of assigned. A stick and carrot approach may be 96th Street on the East side—were completed necessary to steer drivers toward accepting using such a program, the MTA could save an paratransit trips. Protections must be in place estimated $28 million.60 If customers using to ensure taxicab, street-hail liveries, TNCs, and TNCs were encouraged or required to use other for-hire vehicles do not avoid paratransit carpooling options such as UberPool, LyftLine, service for such a program to be effective; or Via, savings could be as high as $37 million.61 however, incentives such as higher fares or Moreover, it may be appropriate to expand this bonus payments may be more effective in expectation to the outer boroughs. Particularly ensuring drivers provide satisfactory paratransit with the advent of street-hail liveries and service. The use of ratings for such TNC app-hailed for-hire vehicles, a fare subsidy applications like Uber and Lyft could be one might extend beyond Manhattan’s hail zone. way to ensure registrants are able to commend Removing these trips from the manifests of or condemn a driver appropriately. The MTA DSC vehicles would also enable them to serve and TLC should collaborate to help increase their remaining customers more quickly and the wheelchair-accessible fleet and ensure all efficiently. drivers are receiving the proper training.
Such a subsidy would raise two potential Increasing the use of non-carrier modes with issues—induced demand and driver reluctance these methods will require solving technical to accept paratransit trips. In many cases problems as well. Payment of providers will customers would rather reserve a vehicle on require a separate system from the current the day of the trip—or better still, hail a cab or model, one that can verify a customer’s connect with a TNC immediately—than wait for eligibility and deliver payments to drivers. conventional paratransit service the next day. If Leveraging benefits from TNC-provided trips such more convenient service were available, may require smartphone access and ability then registrants might take more trips. While the to use the associated application. However, MTA could take steps to mitigate this concern, paratransit dispatchers may be able to tap such as limiting the subsidy and requiring directly into these networks to schedule and registrants to pay the metered fare above the coordinate trips on a registrant’s behalf. AAR amount, such limitations would not comply with ADA standards on fares. As a result, the MTA would be required to continue offering New Organizational Model. The MTA’s core conventional paratransit service.62Even if such competency is moving large numbers of people a program induced demand, each trip replaced through the region using its major transportation would save enough on average to supply 2.1 assets, namely the bus, subway, and commuter additional trips, meaning paratransit trips of rail systems. Though ADA compels the agency this type would need to increase 25 percent to provide paratransit service, such operations to increase total costs; paratransit trips of this lie outside the agency’s greatest strengths. In type would need to increase up to 118 percent response, the MTA has contracted with private if implemented as a carpool option.63 Such a firms to provide most paratransit functions while level of induced demand is unlikely. Moreover, it performs only administrative functions. This if paired with a proportionate increase in design has the benefit of fostering competition service and customer satisfaction, some share among contracted carriers and coordinating of induced demand may be acceptable. the reservation and dispatch functions under a single command center contract. Using a Drivers may see a paratransit trip as less private firm to manage call center operations appealing and either openly or covertly avoid at the command center also allows for such a trip in favor or a more attractive fare. smoother adjustments to staffing levels and A paratransit trip may require more time and introduction of new technologies. However, effort on behalf of the driver, and unlike DSCs contracting separately divides responsibility for or vehicles associated with BCS, they are not performance among several firms and places a heavy burden of coordination on the MTA.
22 Private brokers put distance between a transit agency and the entities they contract with to provide paratransit services, which can allow for more effective bargaining and greater flexibility when procuring services
Other paratransit system designs may provide costs are based on a per trip fare structure additional benefits. A full-service brokerage that takes into account the type of vehicle model allows transit agencies to set policy and service provided. Like the MTA, ATS and oversee the broker’s contract while reimburses providers based on vehicle-revenue leaving all other administrative functions— hours; however, ATS requires contractors meet including procurement, contract management agreed upon productivity goals based on the and monitoring, recordkeeping, and customer mix of trips assigned. Contractors exceeding its service—to a single contracted entity. Good productivity goal may gain additional trips while brokers can foster competition and redirect contractors failing to meet their productivity trips to better performers. Private brokers also goal may see trips shifted to other contractors. have the advantage of greater flexibility when By working with ATS, PAT has kept its general procuring services, particularly contracted administration expenses as a share of total carriers.64 expenses equal to 8 percent, or $1.82 per trip. Moreover, ATS has recorded one of the highest In 2014 AAR spent 19 percent of total productivities in the United States, completing paratransit expenses on general administration 2.27 trips per hour in 2014, 184 percent of costs, slightly less than the median for other AAR’s productivity. large systems.65 However, AAR’s $13.22 spent in general administration expenses per trip The success of this organizational model in ranked 9th most expensive of 29 other large other transit agencies is worth studying. While systems, 59 percent higher than the median.66 lowering general administration expenses per A move to a full-service brokerage might trip to less than $2 is ambitious, lowering the reduce these costs. The Santa Clara Valley share of total expenses dedicated to general Transportation Authority (VTA) manages its administration to the same level as these other paratransit in this manner. When VTA adopted systems could save between $25 million and this approach in 2012 they were able to lower $30 million.69 operating costs by 13 percent. This system design allowed OUTREACH, VTA’s broker, more flexibility to implement strategies to Better Manage Demand improve routing and scheduling, use more non- dedicated service providers, and centralize Since 2002 the number of paratransit trips vehicle maintenance. Under this system has grown at an average annual rate of 8.4 design, VTA spends 7 percent of all paratransit percent, nearly five times that of subway expenses on administration, the lowest share ridership (1.7 percent) and 12 times that of 70 of all systems studied.67 commuter rail ridership (0.7 percent). Thus far much of the MTA’s paratransit savings Another paratransit provider that uses this have been accomplished by slowing this trip model is Access Transportation Systems, Inc. growth; however, more could be done to (ATS), a full-service brokerage coordinating reduce trips. Two approaches are to facilitate service for the Port Authority of Allegheny and encourage shifting rides to the accessible County Transit (PAT) in Pittsburgh.68 Paratransit fixed-route services and to raise fares to cover
23 more of the cost of the most discretionary uses MetroCards convert to paratransit rides, then of paratransit. any net benefits are eliminated.
The MTA will continue to review the program Encourage Use of the Fixed-Route System. to determine its impact and improve fraud Options for shifting appropriate rides to the detection.75 Even if the MTA increased trips fixed-route system are an improved Zero- diverted to a modest 2.5 percent of the 6.4 Fare MetroCard program and increased use million total AAR trips in 2015 to the fixed- of feeder services. The MTA in 2011 began route system, the MTA could have saved a Zero-Fare MetroCard program, allowing $11 million. If 5 percent of all trips had been some AAR registrants to travel the fixed-route diverted to the fixed-route system, the annual system for free in lieu of a more expensive savings could surpass $22 million.76 AAR trip. The program has suffered from weak internal controls to limit use of the cards by Another way to encourage use of the fixed- ineligible individuals and has faced difficulties route system is to offer feeder service more in marketing the cards to registrants most able often. According to FTA regulations, feeder to use the fixed-route system.71 service may be offered so long as the trip is deemed accessible and comparable to a trip Based on experience in other cities, improving taken by a conventional user of the fixed-route the Zero-Fare MetroCard program may be system. However, in 2015 fewer than 44,000 made more effective by targeting it to new trip requests were met with an offer of feeder AAR applicants and accompanying it with service, merely 0.6 percent of total requests. an increase in the paratransit fare. (For more Of this group, AAR customers declined on fare increases, see section below.) In 34,014 offers of feeder service resulting in Washington D.C. Metro Access began allowing the reduction of a paratransit trip, while the paratransit customers to ride buses and remaining 9,668 accepted trips generated 33 subways for free while raising paratransit fares, percent fewer vehicle service hours than a in some cases doubling them. From 2010 to similar door-to-door paratransit trip.77 2013 paratransit trips declined 14 percent, and the agency estimated free use of the fixed- Currently the MTA provides feeder service only route system alone saved the agency up to to bus stops, not subway stations, and only $25 million annually.72 Other transit agencies for outgoing, not return, trips. The restriction have implemented similar fare incentives and on subway stops, despite 100 stations being achieved significant savings. Programs for made accessible, is because the escalators and paratransit customers in Boston and Utah elevators are not deemed sufficiently reliable demonstrated estimated savings of 9 percent and because FTA guidelines require transit and 7 percent, respectively.73 agencies assure sidewalk infrastructure issues or other obstacles do not make a customer’s Introduction of the Zero-Fare MetroCard in pathway unnavigable. The restriction on feeder New York was not accompanied by proper service for return trips is because these trips controls to deter improper use of the program. are often subject to unpredictable or changing According to a report from the MTA’s Inspector schedules, and offering feeder service pickups General in 2014, the transit agency did not 74 may result in long wait times for customers at have procedures in place to detect fraud. the end of their fixed-route journey. Since that time the MTA has stopped sending MetroCards to all paratransit registrants, Promoting greater use of feeder service by instead offering them only to those customers the MTA would require more collaboration who request one. Moreover, in its July 2016 with the City to remove navigational hazards financial plan the agency proposed turning between common fixed-route stops to widen the Zero-Fare program into a reduced fare the pool of potential trips. For example, street program. This shift has a high possibility of improvements to bus stops could elevate being counterproductive. If less than 3 percent sidewalks to cut down on the time needed to of the rides currently taken using Zero-Fare load and unload wheelchairs, allowing buses to
24 reduce dwell time while accommodating the Change the Revenue Mix mobility impaired. To permit feeder service on return trips, the MTA is working on options for As previously described, the current revenue users to provide coordinates and times while mix supporting AAR is 4 percent from fares, on board a bus. The MTA should accelerate 14 percent from the dedicated portion of the this work and further improve its scheduling Urban Tax, 27 percent from a subsidy from software to incorporate more feeder service in City of New York general fund revenues, and an efficient manner. If the share of trip requests 55 percent from an internal MTA cross-subsidy met with an offer of feeder service increased drawing on fares paid by regular subway and from the current 0.6 percent to 2.5 percent, bus riders. A better mix would be one in which $8.6 million would be saved in fewer trips and the internal cross-subsidy was lower and other service hours. If feeder service responses were sources were higher. increased to 5 percent, then the savings would be $20 million.78 The most effective strategy for lowering the cross-subsidy is lowering total costs. This is the case because the cross-subsidy covers a deficit Higher Fares. The ADA stipulates paratransit left after the other sources are tapped; the fare may not exceed twice the single-ride fare other revenue would change little or not at all of a similar trip. Since 1993 the MTA has set even if expenses were lower. Thus the options the AAR fare at the same level as the transit 79 identified above to lower expenses are also base fare. key strategies for lowering the internal cross- Efforts to double the AAR fare as part of the subsidy. 2009 MTA budget failed; however, as AAR costs continue to grow, the agency should Fares are unlikely to become a substantially revisit the policy.80 Such a change may be increased source of revenue. Even under the politically unpopular and would require the politically unlikely scenario discussed above of cooperation of other stakeholders. Yet without doubling the current fare, $181 million of the efforts to reduce demand, growing use of total $184 million in fiscal benefits comes from paratransit vehicles for discretionary trips lower cost from eliminated rides while about will escalate costs and put pressure on the $3 million comes from the net gain in fare quality of service for more essential trips. Fare revenue. Under that scenario the increase in elasticities for paratransit service have been fare revenue as a share of expenses is a modest measured between -0.13 and -0.41, meaning 3.9 percent to 7.5 percent. However the MTA that doubling fares could result in ridership may be completing trips that another source declines between 13 percent and 41 percent.81 can fund—payments from the joint federal- The fiscal benefits from a fare increase are state Medicaid program financing medical care primarily the reduced variable cost for the trips for low income residents. eliminated, but also include the net gain in fare revenue from the loss of revenue at the Medicaid Payments. Under federal law current price for eliminated trips and the added States must ensure Medicaid patients receive revenue at the higher price for the remaining necessary transportation to and from medical trips. Based on 2015 data, a doubling of fares providers, including trips related to medical would generate net fiscal benefits of between appointments. The benefit applies not only $71 million and $184 million annually. A more to emergency transportation by ambulances, modest fare increase from $2.75 to $3.50 or but to non-emergency medical transportation $4.00—paratransit fares in Washington, D.C. (NEMT) trips as well. These trips may be and Philadelphia, respectively—would net completed using ambulettes (including between $20 million and $86 million annually.82 wheelchair-accessible vans), taxis or liveries, and mass transit.83 Although AAR registrants are not required to state the nature of their trip to the MTA when securing a reservation, it is likely that a share of current trips qualifies
25 as NEMT and may be eligible for Medicaid as the rest of the City adult population, payments. But the MTA has no way of knowing approximately 52,250, or 36 percent, of AAR when this is the case or of documenting and customers are Medicaid eligible.85 If 1 in 20 billing for the service. trips by these Medicaid eligible customers are NEMTs, the MTA could generate an additional The MTA has attempted to establish that a share $3 million annually in Medicaid payments. If of its paratransit trips ought to be considered 1 in 5 of these trips is eligible for Medicaid NEMT; however, Medicaid authorizes reimbursement, the MTA could generate an transports using the least costly, most medically additional $10 million to $14 million annually. appropriate mode of transport. It has indicated it would reimburse the MTA only the fare paid Reforming federal and state policies to allow by AAR registrants. The difference between NEMT reimbursement for relevant paratransit the AAR fare and Medicaid reimbursement for trips may be a welcome change for other ambulettes, taxis, and liveries is significant, and paratransit providers in New York State as well, could defray some of the cost of paratransit including those in the MTA service region. service for eligible trips. According to federally reported data, ADA paratransit trips provided by New York transit For example, in New York City, depending upon agencies other than the MTA surpassed 5.7 the level of care, Medicaid pays for eligible trips between $25 and $33.84 Assuming the same million in 2014, costing more than $276 million. share of AAR registrants is enrolled in Medicaid
26 REDESIGNING ACCESS-A-RIDE’S FUTURE
Under current policies AAR’s problems will get Table 7: Access-A-Ride Expenses, worse. The program will become increasingly Revenues, and MTA Cross- expensive as the volume of trips grows and the cost per trip increases. The fiscal burden Subsidy, 2020, Financial Plan and on general taxpayers and on subway and bus Illustrative Savings Target riders who pay regular fares will also get worse. uly 2016 Savings The MTA’s leaders should purse new policy Projection Target directions to create a better future for AAR. A A T 8,349,011 6,360,165 Table 7 compares the MTA’s latest projections Co e T 77.42 65.00 for AAR with an alternative scenario that incorporates changes based on the policy To al x en e (in millions) 646 413 options identified in this report. A combination of available options could be implemented to Fa e e en e 24 26 achieve the goals of containing the growth in an Tax 56 56 number of trips, lowering the cost per trip, and C y e e en 182 102 reducing the role of the internal cross-subsidy in financing AAR. Instead of the projected TA C o - y 385 230 annual growth in trips of 6.5 percent, the goal should be to keep trip volume flat at the 2015 C o - y e T 0.16 0.09 level. Instead of allowing the cost per trip to Notes: Savings goal set by keeping ridership at 2015 levels and reducing the rise to $77, the goal should be to lower it cost per trip to $65. 16 percent to about $65. If these targets are Fare revenue estimated by increasing fares by 50 percent, equivalent to $4.12. achieved, the necessary City tax subsidy would City reimbursement assumes all non-fare revenues and non- decline $76 million, or 42 percent, and the reimbursable expenses as projected in the February 2016 financial plan. cross-subsidy from transit would decline $160 Source: Metropolitan Transportation Authority, 2017 Preliminary Budget, July Financial Plan 2017-2020 (July 2016), Paratransit Operations, p. III-18. million, or from about 16 cents to 9 cents per MetroCard swipe.
The options identified in this report can lead to these fiscal benefits while also improving the quality of service available to AAR registrants who can make greater use of alternative vehicles that better meet their needs and pick them up more promptly. All of AAR’s stakeholders— registrants, MTA and City officials, and ordinary straphangers should support the types of changes needed to realize a better future for this important service.
27 ENDNOTES
1 Permanent Citizens Advisory Committee to to the fixed-route. See: 49 CFR Sec. 37-129, the MTA, Welcome Aboard, accessibility at the Appendix D to Part 37-Construction and MTA (October 2008), pp. 1-8, www.pcac.org/ Interpretation of Provisions of 49 CFR. wp-content/uploads/2014/09/Welcome-Aboard- Accessibility-at-the-MTA.pdf. 10 U.S. Department of Transportation, Federal Transit Administration, “Origin-to-Destination 2 Metropolitan Transportation Authority, Capital Service” (accessed July 29, 2016), www.transit. Plan 2015-2019, Renew, Enhance, Expand (April dot.gov/regulations-and-guidance/civil-rights-ada/ 20, 2016), p. 56, http://web.mta.info/capital/pdf/ origin-destination-service. MTA_15-19_Capital_Plan_Board_WEB_Approved_ v2.pdf. 11 Three categories of eligibility are (1) those that cannot independently board, ride, or exit a bus 3 Sources and methods used to calculate these or train accessible to persons in wheelchairs, (2) figures are described in later text and tables. disabled persons who can use accessible fixed- route vehicles who wish to travel a route that 4 State of New York, Joint Senate Bill 10133 and does not have these vehicles, and (3) persons Assembly Bill 11981 (June 28, 1984). with specific impairment-related conditions preventing travel to or from fixed-route boarding 5 Service began in January 1990 in the Bronx, locations. Agencies may also require applicants Brooklyn, Manhattan, and Queens and in July to self-certify, provide professional verification of 1990 on Staten Island. See: City of New York, need via documentation, or both. See: General Office of Management and Budget, Executive Accountability Office, ADA Paratransit Services: Budget, Fiscal Year 1992, Message of the Mayor (May Demand Has Increased, but Little is Known about 10, 1991), p. 189. Compliance, GAO-13-17 (November 2012), Table 2: Types of ADA Paratransit Eligibility 6 49 CFR Sec. 37-123(e); and General Determination Processes Used by Transit Agencies, Accountability Office, Americans With Disabilities p. 6, www.gao.gov/products/GAO-13-17. Act: Challenges Faced by Transit Agencies in Complying With the Act’s Requirements, RCED-94- 12 City of New York, Mayor’s Office of Operations, 58 (March 1994), p. 1, www.gao.gov/products/ Mayor’s Management Report (annual editions 1990 RCED-94-58. to 1993), “Department of Transportation,” and Office of Management and Budget, Executive 7 Additionally, personal care attendants may not be Budget, Supporting Schedules (annual editions 1990 charged a fare. to 1993). 8 General Accountability Office, ADA Paratransit 13 Paratransit Agreement Between City of New Services: Demand Has Increased, but Little is Known York and the Metropolitan Transportation Authority about Compliance, GAO-13-17 (November (May 28, 1993), pp. 1-2. 2012), Table 1: ADA Minimum Paratransit Service Requirements for Comparability to Fixed-Route 14 Metropolitan Transportation Authority, Service, p. 5, www.gao.gov/products/GAO-13-17. Paratransit Division, email to Citizens Budget Commission staff (May 23, 2016). 9 The MTA does not include the subway system in scheduling consideration at this time because 15 Leye Jeannette Chrzanowski, “DOT Guidance many stations are inaccessible and matching trip Clarifies Paratransit Regulations,” The Disability origins and destinations to accessible stations is News Service, Inc. (March 3, 2000; accessed problematic. A paratransit fare may be charged, but customers may not be charged for transfer
28 April 5, 2016), www.uic.edu/orgs/ada-greatlakes/ 24 The MTA introduced a feeder service pilot adanews/003dotguidance.htm. program in 2007; however, the agency halted expansion as the call center found it easier to 16 Metropolitan Transportation Authority, schedule individuals for full door-to-door service. Paratransit Division, email to Citizens Budget See: U.S. Department of Transportation, Federal Commission staff (June 21, 2016). Transit Administration, National Transit Database (updated January 2015), www.ntdprogram. 17 The lack of data regarding the number of gov/ntdprogram/data.htm; and Metropolitan non-dedicated service carrier trips completed Transportation Authority, 2010 Adopted Budget, from 2002 to 2007 make determining actual February Financial Plan 2010-2013 (February productivity difficult. Productivity is presumed 2010), http://web.mta.info/mta/budget/. to be lower in all years owing to the completion of some ADA trips by non-DSC providers. See: 25 Savings calculated using average vehicle service Metropolitan Transportation Authority, Paratransit hour cost of $30. See: City of New York, Office of Division, email to Citizens Budget Commission the Comptroller, Audit Report of the Metropolitan staff (May 23, 2016). Transportation Authority’s Oversight of the Access- A-Ride Program, FK15-098A (May 2016), http:// 18 New York City Independent Budget Office, comptroller.nyc.gov/reports/audit/?r=05-17-16_ Using Taxi Vouchers to Lower the Cost of Paratransit FK15-098A. Service (June 2007), pp. 6-8, www.ibo.nyc.ny.us/ iboreports/WebTaxiVouchersJune07.pdf. 26 Metropolitan Transportation Authority, Paratransit Division, email to Citizens Budget 19 Metropolitan Transportation Authority, 2008 Commission staff (May 23, 2016). Final Proposed Budget, November Financial Plan 2008-2011 (November 2007), p. 70, http://web. 27 Average cost per trip of $57.53 used to mta.info/mta/budget/. determine savings from foregone trips, equal to average per trip payment to contracted carriers in 20 Metropolitan Transportation Authority, 2009 2015. See: Metropolitan Transportation Authority, Adopted Budget, February Financial Plan 2009-2012 Paratransit Division, email to Citizens Budget (February 2009) and MTA New York City Transit/ Commission staff (June 7, 2016). Staten Island Railway Additional Actions for Budget Balance-Proposed Savings, p. 293, http://web.mta. 28 Metropolitan Transportation Authority, info/mta/budget/. Paratransit Division, email to Citizens Budget Commission staff (July 26, 2016). 21 Metropolitan Transportation Authority, 2010 Final Proposed Budget, November Financial Plan 29 Zero-Fare MetroCards allow AAR users to swipe 2010-2013 (November 2009), Volume II, p. 113, into a subway station or onto a bus multiple times http://web.mta.info/mta/budget/. in order to allow personal care attendants or guests to ride with them. 22 Metropolitan Transportation Authority, Final Proposed Budget, November Financial Plan (annual 30 Metropolitan Transportation Authority, editions 2009 and 2010) and MTA New York City Committee on Finance, Staff Summary – Paratransit Transit, Budget Reduction Program Summary, p. Cost Savings Initiative (June 2012), p. 1, http://web. 472, http://web.mta.info/mta/budget/. mta.info/mta/news/books/docs/staffsummary_ finance_1206.pdf. 23 Metropolitan Transportation Authority, Paratransit Division, email to Citizens Budget 31 Metropolitan Transportation Authority, 2017 Commission staff (May 23, 2016); and Office of Preliminary Budget, July Financial Plan 2017-2020 the New York State Comptroller, Metropolitan (July 2016), V-254, http://web.mta.info/mta/ Transportation Authority: An Overview of the budget/. Paratransit Program, Report No. 1-2015 (April 2014), pp. 1-2, www.osc.state.ny.us/osdc/rpt1- 32 These categories include Stairs Restricted, 2015.pdf. Extreme Cold/Heat, Other Weather, Unfamiliar Places, and Excessive Distance.
29 33 Metropolitan Transportation Authority, New York Operations, p. II-69, and MTA New York City City Transit, “Access-A-Ride Service Application” Transit Ridership/Traffic Volume (Utilization) p. (2015), http://web.mta.info/nyct/paratran/access_ V-242, http://web.mta.info/mta/budget/. application.pdf. 42 Metropolitan Transportation Authority, 2017 34 The MTA retains the right to review appeals of Preliminary Budget, July Financial Plan (July 2016), eligibility determinations, as well as the hardware Volume II, p. V-240, http://web.mta.info/mta/ and software systems responsible for aggregating budget/. reservations and dispatching drivers and vehicles. 43 Directional route miles of local bus and select 35 Metropolitan Transportation Authority, bus service reported in the 2014 National Transit Paratransit Division, email to Citizens Budget Database. Distance to and from Atlanta calculated Commission staff (June 23, 2016) and presentation using driving directions in Google Maps. to Citizens Budget Commission staff (April 25, 2015); and New York City Independent Budget 44 U.S. Census Bureau, American Community Survey Office, Access-A-Ride: With More Riders, Costs Are (2014), S0801 Community Characteristics, http:// Rising Sharply (October 2006), p. 4, www.ibo.nyc. factfinder.census.gov/faces/nav/jsf/pages/index. ny.us/iboreports/FBparatransit10306.pdf. xhtml.
36 City of New York, Office of the Comptroller, 45 Selected systems include all paratransit Audit Report of the Metropolitan Transportation providers reporting 500,000 ADA trips or Authority’s Oversight of the Access-A-Ride Program, more and reporting ADA-related expenses FK15-098A (May 2016), http://comptroller.nyc. in 2014—the latest year for which data are gov/reports/audit/?r=05-17-16_FK15-098A. available. This list includes: Alameda-Contra Costa Transit District (Oakland), Access Services 37 Metropolitan Transportation Authority, 2017 (Los Angeles), Bi-State Development Agency of Preliminary Budget, July Financial Plan 2017-2020 the Missouri-Illinois Metropolitan District (St. (July 2016), p. V-263, http://web.mta.info/mta/ Louis), PalmTran (Palm Beach County, Florida), budget/. Broward County Transit Division (Fort Lauderdale), Capital Metropolitan Transportation Authority 38 Calculations use 2015 total for transit cross- (Austin, Texas), City and County of Honolulu subsidy for AAR and transit ridership. See: Department of Transportation Services, Dallas Metropolitan Transportation Authority, 2017 Area Rapid Transit, Delaware Transit Corporation, Preliminary Budget, July Financial Plan 2017-2020 Denver Regional Transportation District, King (July 2016), MTA New York City Transit Ridership County Metro Transit (Seattle), Maryland Transit Traffic Volume (Utilization), p. V-242, http://web. Administration, Massachusetts Bay Transportation mta.info/mta/budget/, and Paratransit Division, Authority (Boston), Metro Mobility (Minneapolis), email to Citizens Budget Commission staff (May Metropolitan Atlanta Rapid Transit Authority 23, 2016). (California), Metropolitan Transit Authority of Harris County, Texas (Houston), Miami-Dade Transit, 39 Metropolitan Transportation Authority, 2017 New Jersey Transit, Orange County Transportation Preliminary Budget, July Financial Plan 2017-2020 Authority, Pace-Suburban Bus Division (Chicago), (July 2016) and MTA New York City Transit Regional Transportation Commission of Southern Paratransit Operations, p. II-69, http://web.mta. Nevada (Las Vegas), San Francisco Municipal info/mta/budget/. Railway, Santa Clara Valley Transportation Authority (San Jose), Southeastern Pennsylvania 40 Though the MTA typically increases the base Transportation Authority (Philadelphia), Suffolk fare during a fare increase, it is not required. County Department of Public Works (Long Island, 41 Per transit trip equivalent calculated using New New York), Tri-County Metropolitan Transportation York City subway and bus projected ridership. District of Oregon (Portland), VIA Metropolitan See: Metropolitan Transportation Authority, 2017 Transit (San Antonio), and Washington Preliminary Budget, July Financial Plan (July 2016), Metropolitan Area Transit Authority. See: U.S. Volume II, MTA New York City Transit Paratransit Department of Transportation, Federal Transit
30 Administration, National Transit Database (updated 51 Metropolitan Transportation Authority, January 2015), and Table 19: Transit Operating Paratransit Division, email to Citizens Budget Statistics: Service Supplied and Consumed,www. Commission staff (July 26, 2016). transit.dot.gov/ntd. 52 Some trips may be purchased with a pre- 46 Service area population is reported by transit approved voucher. Additionally trips to AAR agencies to the National Transit Database. Shares assessment centers to establish or renew eligibility of service area population older than 64 years and trips to Veterans Affairs Hospitals may be of age and disabled are calculated using the completed using taxicab vouchers. See: City American Community Survey. When a precise of New York, Independent Budget Office, Taxi service area is not known, American Community Vouchers for Paratransit (2007), pp. 2-3, www.ibo. Survey geographies are approximated. See: U.S. nyc.ny.us/iboreports/WebTaxiVouchersJune07.pdf. Department of Transportation, Federal Transit Administration, National Transit Database (updated 53 This decline is largely owing to a retrenchment in January 2015), www.transit.dot.gov/ntd; and use of taxicabs for ADA paratransit trips owing to U.S. Census Bureau, American Community Survey concerns with fraud and abuse. See: Metropolitan (2014), S0801 Community Characteristics, http:// Transportation Authority, Office of the Inspector factfinder.census.gov/faces/nav/jsf/pages/index. General, Fraud Controls in the Paratransit Taxi xhtml. Reimbursement Program, Report No. 2014-22 (January 2015), www.mtaig.state.ny.us/assets/ 47 According to Census estimates, only 45 percent pdf/14-22.pdf. of households in New York City have access to a vehicle. That same figure is 91 percent nationally, 54 Trip totals for individual DSCs come from City 90 percent in Los Angeles County, 88 percent in Comptroller’s report. Remaining taxicab trips and the Chicago Metropolitan Area, and 86 percent in expense totals for each type of trip are calculated the Boston Metropolitan Area. See: U.S. Census using data provided by the MTA. See: City of Bureau, American Community Survey (2014), New York, Office of the Comptroller, Audit Report B08201, Household Size by Vehicle Available, of the Metropolitan Transportation Authority’s https://factfinder.census.gov. Oversight of the Access-A-Ride Program, FK15-098A (May 2016), http://comptroller.nyc.gov/reports/ 48 U.S. Department of Transportation, Federal audit/?r=05-17-16_FK15-098A; and Metropolitan Transit Administration, National Transit Database Transportation Authority, Paratransit Division, (updated January 2015), and Table 19: Transit email to Citizens Budget Commission staff (June Operating Statistics: Service Supplied and 21, 2016). Consumed, www.transit.dot.gov/ntd. 55 Metropolitan Transportation Authority, 49 U.S. Department of Transportation, Federal presentation to Citizens Budget Commission staff Transit Administration, National Transit Database (April 25, 2015), and Paratransit Division, email to (updated January 2015), and Table 19: Transit Citizens Budget Commission staff (July 26, 2016). Operating Statistics: Service Supplied and Consumed, www.transit.dot.gov/ntd. 56 Calculations assume the MTA incurs $3.08 in fuel costs per DSC trip. 50 The Travel Time Index compares peak period travel time to free-flow travel time. The Travel 57 These new banking regulations required a bank Time Index is an estimate of the conditions faced to issue a prepaid card directly to a customer, by urban travelers and can be used to compare and not through the MTA. Owing to privacy laws, different urban areas. The correlation coefficient once this relationship was established, the MTA for Travel Time Index to Trips Completed per could not view individual users’ transactions. Vehicle Hour for the 29 peer systems studied is This opacity would keep the MTA from certifying 0.05. See: Texas A&M Transportation Institute, users were paying for the nature of trip the transit 2015 Urban Mobility Scorecard (August 2015), agency was authorizing. See: Dan Timmeny, New http://mobility.tamu.edu/ums/. York City Taxi and Limousine Commission, phone interview with Citizens Budget Commission staff;
31 and Metropolitan Transportation Authority, “A 63 Calculation assumes full savings from all trips New Option for Access-A-Ride Customer” (press originating in Manhattan hail zone is offset by release, December 15, 2010), www.mta.info/ induced demand of the same type of trips. news/2010/12/15/new-option-access-ride- customers. 64 U.S. Department of Transportation, Federal Transit Administration, Accessible Transit Services 58 Luz Lazo, “Uber flirts with transit agencies for All, FTA No. 0081 (prepared by Disability Rights across the U.S. for a share of paratransit Education and Defense Fund and Marilyn Golden, services,” Washington Post (March 5, December 2014), pp. 28-31, 43-44, 49-50, 56-57. 2016), www.washingtonpost.com/local/ trafficandcommuting/uber-flirts-with-transit- 65 In 2014 AAR spent 18.7 percent of total agencies-across-the-us-for-a-share-of-paratransit- expenses on general administration. The median services/2016/03/05/5eb8b118-d751-11e5- figure for abovementioned peer systems was 19.0 9823-02b905009f99_story.html. percent. See: U.S. Department of Transportation, Federal Transit Administration, National Transit 59 Joseph Kane, Adie Tomer, and Robert Puentes, Database (updated January 2015), Table 13: Transit Metropolitan Policy Program at Brookings, “How Operating Expenses by Mode, Type of Service and Lyft and Uber can improve transit agency budgets” Object Class, www.transit.dot.gov/ntd. (March 8, 2016), www.brookings.edu/research/ papers/2016/03/08-lyft-uber-transit-agency- 66 U.S. Department of Transportation, Federal budgets-kane-tomer-puentes. Transit Administration, National Transit Database (updated January 2015), Table 13: Transit 60 The calculation estimates trips per cab per Operating Expenses by Mode, Type of Service hour using the median number of taxicab trips and Object Class and Table 19: Transit Operating per hour divided by active taxicabs. To estimate Statistics: Service Supplied and Consumed,www. average fare, average gross taxicab driver revenue transit.dot.gov/ntd. per hour is divided by estimated trips per hour. This figure is reduced by 15 percent to adjust for 67 U.S. Department of Transportation, Federal estimated tips received to arrive at an average Transit Administration, Accessible Transit Services fare. Approximately 11 percent of all AAR trips for All, FTA No. 0081 (prepared by Disability Rights originated in the taxicab “hail zone” in 2015. Education and Defense Fund and Marilyn Golden, Estimated savings calculated using per trip December 2014), Appendix D: Case Studies, pp. reimbursement rates for all AAR trips less voucher D-4- D-36. trips, which is equal to $55.45. Adjustment is 68 made for customers paying the $2.75 paratransit ATS and Pittsburgh’s transit agency, PAT, are fare. Calculation includes fuel savings as not included in our list of peers because this previously calculated. See: New York City, Taxi and paratransit service completed 485,703 ADA trips Limousine Commission, 2016 TLC Factbook (2016), in 2014; however, when all non-ADA paratransit accompanying data, Tables 3 and 7, www.nyc.gov/ trips are included, ATS completed nearly 1.6 million html/tlc/downloads/excel/2016_tlc_factbook.xlsx. trips in 2014, more than New Jersey Transit.
69 61 These services generally allow TNC drivers to Calculations used 2015 totals: $462 million pick up multiple customers with multiple drop-off in total expenses and $61 million administrative locations. Customers in these cases pay a flat fare expenses, or 13 percent of the total. Range of typically starting at $5. savings assumes total expenses and administrative expenses both reduced in commensurate amounts 62 U.S. Department of Transportation, Federal so that administrative expenses are equal to 7.2 Transit Administration, Transit Cooperative Research percent and 8 percent of total expenses. See: U.S. Program, Use of Taxis in Public Transportation for Department of Transportation, Federal Transit People with Disabilities and Older Adults, Synthesis Administration, National Transit Database (updated 119 (March 2016), www.tcrponline.org/ January 2015), Table 13: Transit Operating PDFDocuments/tcrp_syn_119.pdf. Expenses by Mode, Type of Service and Object Class, www.transit.dot.gov/ntd.
32 70 Metropolitan Transportation Authority, 79 Under the paratransit agreement between the Paratransit Division, email to Citizens Budget City and the MTA, restructuring the fare requires Commission staff (May 23, 2016). both written agreement from the City and approval by the FTA. Any effort to bypass this rule may 71 Metropolitan Transportation Authority, Office of be stopped by a claimant—that is, a paratransit the Inspector General, Improving Safety Controls in registrant—by seeking an injunction. See: the MTA NYC Transit Paratransit Broker Car Service Paratransit Agreement Between City of New York Program, OIG Report No. 2013-18 (April 2014), p. and the Metropolitan Transportation Authority 3, (May 28, 1993), pp. 13 and 21.
72 Daniel C. Vock, “Disabled in DC: Coping With 80 As an attempt to minimize the paratransit Increasing Costs and Demand for Paratransit,” costs, the MTA’s law department reviewed the Governing (August 31, 2015), www.governing. agreement with the City to determine if the transit com/topics/transportation-infrastructure/gov- agency could single-handedly increase the fare. washington-paratransit-series-one.html. The agency later determined this was not possible. See: Metropolitan Transportation Authority, 73 Transportation Research Board, Transit Paratransit Division, email to Citizens Budget Cooperative Research Program, Strategy Guide to Commission staff (June 28, 2016). Enable and Promote the Use of Fixed-Route Transit by People with Disabilities, Report 163 (2013), pp. 89- 81 Paul Metaxatos and Lise Dirks, “Cost Estimation 90 and Table 7-11 Sample cost savings for three of Fare-Free ADA Complementary Paratransit levels of trip diversion, p. 101, http://onlinepubs. Service in Illinois,” Journal of Public Transportation trb.org/onlinepubs/tcrp/tcrp_rpt_163.pdf. (2012), Volume 15, No. 4, pp. 70-71; and Federal Transit Administration, Transit Cooperative 74 Metropolitan Transportation Authority, Office Research Program, Improving ADA Paratransit of the Inspector General, Fraud Controls in the Demand Estimation: Regional Modeling, TCRP Paratransit Zero-Fare MetroCard Program, OIG Report 158 (prepared by Mark Bradley Research Report No. 2014-10 (August 2014), www.mtaig. and Consulting and Nelson\Nygard Consulting state.ny.us/assets/pdf/14-10.pdf. Associates, 2012), p. 5, http://onlinepubs.trb.org/ onlinepubs/tcrp/tcrp_rpt_158.pdf. 75 Metropolitan Transportation Authority, Paratransit Division, email to Citizens Budget 82 Range of net benefits calculated using elasticities Commission staff (July 26, 2016). of -0.13 and -0.41, 2015 completed trips, and average cost per trip of $57.53, the average 76 Savings calculated using average cost per trip contract reimbursement per trip to contracted of $66.40 and average fuel cost of $3.08 per trip. carriers in 2015. Net benefits include changes See: Metropolitan Transportation Authority, 2016 in fare revenue and operating expense. See: Adopted Budget, February Financial Plan 2016- Washington Metropolitan Area Transit Authority, 2019 (February 2016), Paratransit Operations, p. “MetroAccess Customer Guide” (accessed June III-18, http://web.mta.info/mta/budget/. 15, 2016), www.wmata.com/accessibility/ 77 Metropolitan Transportation Authority, metroaccess_service/customer_guide.cfm#fares; Paratransit Division, email to Citizens Budget Southeastern Pennsylvania Transportation Commission staff (June 21, 2016). Authority, CCT Connect Senior Shared-Ride Program (2015), p. 2, www.septa.org/service/cct/pdf/ 78 Savings estimates uses 2015 total trip requests SRP-Brochure-rev-113015.pdf; and Metropolitan and assumes paratransit users will reject the Transportation Authority, 2016 Adopted Budget, same share of feeder trip responses as in 2015. February Financial Plan 2016-2019 (February In this case, the average cost per trip is $69.48, 2016), Paratransit Operations, p. III-18, http://web. the average per trip reimbursement for DSCs and mta.info/mta/budget/. average fuel cost per trip in 2015. Calculations for 83 savings from reduced vehicle hours assumes each New York State, Department of Health, New vehicle service hour costs $30. York State Medicaid Program, Transportation Manual Policy Guidelines (April 2016), www.
33 emedny.org/ProviderManuals/transportation/ Schedule, 4/1/2016, www.emedny.org/ PDFS/Transportation_Manual_Policy_Section.pdf. ProviderManuals/Transportation/index.aspx.
84 This includes ambulettes as well as taxis, 85 Calculation assumes average beneficiaries for liveries, and vans for adult transportation, New York City less Temporary Assistance for transportation to mental health programs, Needy Families children, safety net children, and and medically necessary transport. for Medicaid and Medicaid and Subsistence. Other reimbursement schedules exist for See: New York State, Department of Health, mileage-based reimbursements but are not “Medicaid Quarterly Reports of Beneficiaries and Expenditures by Category of Eligibility and Social considered in this calculation. See: eMedNY, Service District” (accessed May 16, 2016), 2014 “Transportation Manual” (accessed May 11, Calendar Year, www.health.ny.gov/statistics/ 2016), NYS Medicaid Transportation Fee health_care/medicaid/quarterly/ssd/2014/cy/ beneficiaries.htm.
34 ACCESS-A-RIDE Ways to Do the Right Thing More Efficiently
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