KC Light Rail

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Are buses really cheaper to operate?

One of the overlooked stories in all of the media coverage about skyrocketing gas prices is the price of diesel fuel. Yes, it's exactly $1 more per gallon in the KC metro and surpassed $4 long ago. Since KC's transit operators run diesel buses exclusively, this has to be hitting hard (or at least scaring the pants off those who know when their fuel contracts need renewed).

We were prompted to bring this up while reading an update on Charlotte's fledgling light rail line that opened late last year. Buried in an this update about the line's success is the following statement: "Operating Lynx [light rail] is cheaper than buses, especially in the wake of a surge in fuel prices." So subtract the capital cost — which is substantially higher upfront for light rail, although the equipment lasts longer and feds provide matching funds — and you are now achieving cost parity for operations. Coincidentally, Charlotte's transit agency is about to ask for a fare increase to cover the shortfalls caused by rising diesel costs.

In short, don't be surprised to see a fare increase before light rail starts running in KC… just not before November! The fare bump to $1.25 occurred in early 2006 when gas was probably around the $2 mark. Factor in basically-flat sales tax revenue and it's not a pretty picture for the near term.

5 Comments so far

  1. Eric Rogers June 3rd, 2008 8:08 am

    The flat sales tax revenue will also be an issue for light rail. Despite all of the retail development on the Plaza, in Downtown, and in the Northland, KCMO’s sales tax revenue is stagnant. The new development is not generating an increase in revenue.

    Some think it is because virtually all of the new development is TIFed or otherwise subsidized, so the net increase goes to the developers instead of the city. Others think it is because the new development is just barely offsetting losses from stores closing in the east and southeast of the city.

    It’s probably a combination of the two, but it shows the danger of relying a single revenue source. It is really too bad that the task force isn’t seriously considering a diversified revenue stream that includes not only sales tax but also business taxes, license fees, etc.

  2. northlander June 3rd, 2008 4:35 pm

    Looks like we will have a 30% increase in electricity as well.

  3. […] bus tax in KCMO: SB 1131. Seems it’s simply waiting for Governor Matt Blunt’s signature. We posted earlier that flat sales tax proceeds + higher fuel costs does not a happy transit authority make, […]

  4. northlander June 3rd, 2008 10:20 pm

    So after $25 million for start up cost for the “Max” how many Max buses are on main, and how many regular buses? What is the total amount of gas they burn per year??

  5. Dave June 3rd, 2008 10:29 pm

    We have no idea, and we doubt the ATA would share that info.

    The MAX buses themselves barely qualify as BRT*, but basically share a route with local #57. Regardless, the “start-up costs” (capital) had a federal match… no way they could have paid for that with the paltry KCMO bus tax.

    *The “light rail on wheels” argument would be valid if MAX matched capacity and speed. The buses are the same capacity as a regular bus (versus articulated, which hold about double); there is no off-board ticketing; and no level boarding. All of these things affect the efficiency of the route and make it less effective than light rail.

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