LA Times 1/18/14 by Laura Nelson
Well there is another surprise; MTA’s revenues do not support their costs. $36M shortfall! Put another way, if they were a business, they would be out of business.
They plan to raise fares to support their budget. Given the fact of how poorly the system has been managed today, no matter how much they raise the fares, the end result will be the same, an operating loss.
The only way the MTA can can win is by improving service and attracting the next tier of riders, LA’s middle class. 85% of the riders in the bus cannot afford cars and are typically in the lowest economic class. MTA sells to this crowd because they don’t care to offer a service only a lift. (Check out the advanced signage I saw on my recent bus trip!)
Overall, we need to adopt the practices outlined in “Driving Excellence” by Mark Aensk.
Mark ran the Rockchester, NY transit system and made it work in a down economy without rate hikes. He did one thing, he made it attra
ctive to new customers who started using the system.
The MTA gets only 26% of their revenues from fares. You and I as taxpayers are footing the bills for the other 74%. This money that should be used for maintaining our roads and infrastructure.
Ultimately, Running transit like a business is the only way we will be successful. Segment your services, innovate to attract new customers and provide world class experiences. This is how you turn a deficit into a surplus, or as we say in the real world “a profit!”