More than 19,300 people rode the Blacksburg-to-D.C. “Virginia Breeze” bus line launched by the Department of Rail and Public Transportation (DRPT) during its first year in operation. The $200,000 subsidy amounts to a subsidy of roughly $10 per ticket. Was that a good expenditure of public funds? Let’s dig into that question.
Partnering with Megabus, the inter-city bus company, DRPT rolled out the service in November 2017 with seven stops along Interstate 81 and in Northern Virginia. Greater Greater Washington describes the partnership this way:
Virginia has access to buses and logistical support without having to buy its own fleet or hire staff to maintain and drive them. For a ticket price ranging between $15 and $50, passengers on the 56-seat Breeze buses get a restroom, baggage storage, free Wi-Fi, and in-seat power outlets just like regular Megabus customers. Breeze riders can even buy interline tickets for Megabus destinations beyond the Union Station terminus, a first-of-its-kind feature in the US.
Farebox recovery, the percentage of costs recovered by ticket sales, has consistently run around 70% to 80% since launch, far superior to the typical transit company’s 30% recovery.
Now DRPT is planning to launch two more bus services next year: a Martinsville-to-Richmond route and a Danville-to-Washington route, also with multiple stops along each route.
The obvious question a skeptic would ask is why the need for an average $10-per-passenger subsidy? If a Virginia Tech student is willing to pay $50 for a ticket home to Northern Virginia, would he or she hesitate to pay $10 to $20 more? And if they’re not willing, why not? Do they have other means of getting home? When I was in college (in the Dark Ages), kids posted notes on bulletin boards looking for ride shares. Typically, car-less students could find someone to take them in exchange for gas money. Somehow Hokies managed to find their way home before the advent of Virginia Breeze. How, oh, however did they do it?
I’m no longer connected to that world, but I bet that most have smart phones and ride-sharing apps like this one: Waze Carpool.
Conversely, reasonable arguments can be made in support of Virginia Breeze. The bus consolidates 30 or 40 or so students into a single vehicle. A bus takes up a lot less space capacity on an overloaded Interstate 81 than many cars. If the state is willing to expend billions of dollars to expand I-81’s capacity, surely it’s worth expending a few thousand to reduce traffic on the same arterial.
Actually, that depends. I don’t have the data to make that calculation, but it would look something like this (using totally made-up figures for purposes of demonstrating the logic): Let’s say the Virginia Department of Transportation proposes spending $3 billion for I-81 upgrades to be financed through the sale of 30-year bonds. Let’s say that the cost of financing + maintenance + operations equals $200 million a year. And let’s say that the improvements increase I-81’s throughout by 20,000 vehicles per day. That amounts to an expenditure of about $14 per vehicle. Now, let’s say the average vehicle carries 1.3 people. That works out to an expenditure of about $10.50 per passenger — slightly more than the $10 Virginia Breeze subsidy. Under that scenario, the Virginia Breeze might make economic sense.
But wait… We cannot assume that every Virginia Breeze passenger would have driven a single-occupancy vehicle instead. Perhaps some would have ridden a commercial bus service. Perhaps some would have carpooled. Perhaps a few would have hitch-hiked, and some would have foregone taking the trip. The only way to estimate the alternative behavior is to conduct market research — actually questioning would-be passengers. Whatever the case, we can be reasonably certain that the 19,300 Virginia Breeze riders would not have added 19,300 cars to the roads. The number would be significantly smaller.
As you can see, the analysis can get very complicated. Is the $10-a-head subsidy worth it to reduce traffic on I-81? You tell me.
(Hat tip: Win Barber)
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