LESSONS NOT LEARNED Privatization Of Transport Has Led To Unregulated Chaos Conditions Approach Tipping Point On Boston’s Streets And Rails

Reprinted with Permission of Banker & Tradesman

The transportation landscape in Greater Boston is changing in subtle but momentous ways. Technological innovations and industry disrupters are remaking the way we think about mobility. The dominance of transportation network companies, also known as rideshare companies, has permanently altered our thinking about urban mobility. The prospect of autonomous and connected vehicles is radically changing the way we think about land use, infrastructure and privacy. The trend towards smart cities has us reimagining our relationship with the urban environment, forcing us to consider how technology will change how transportation services are delivered. However, there is a less well known trend also gaining momentum – the privatization of transit.

The trend towards privatization started decades ago, when municipalities started forcing land developers to fix infrastructure as a condition of receiving permits. Historically, it has been government’s job to build infrastructure. In the 1980s, tax conscious communities across the United States reversed course, limiting the growth of taxes. As a result of the movement to reduce taxes, municipalities turned to private interests to fix infrastructure on a project by project basis. Over time, this trend extended to state governments as well.

Today, continued pressure on state and municipal budgets is prompting a new wave of privatization efforts. The repeal of the indexed gas tax in Massachusetts was felt far and wide in the transportation sector. It was clear that taxpayers did not want to pay more taxes for better transportation. This has been most acutely visible in the transit sector, where urban environments have been pitted against rural communities: cities want the state to invest more in transit, and rural communities do not want to see increased taxes to pay for urban mass transit. Enter the private sector again.

Across the state, private interests are creating their own mobility solutions because the cities and the state can’t (or won’t) help them. The Medical Academic and Scientific Community Organization Inc. (MASCO) was a pioneer in this area, creating a fleet of shuttle buses that serve the mobility needs of the Longwood Medical Area. Other private interests have followed suit, including Partners Health Care, which operates an extensive shuttle bus network for its employees and patients.

Transportation Management Associations (TMAs) have also become very prevalent in providing quasi-private shuttle systems. TMAs are public-private partnerships of businesses and government, working together to provide mobility solutions. The underlying logic of TMAs is that companies can pool their resources to make transportation solutions more cost effective, while simultaneously reducing traffic congestion, improving air quality and creating economic development.

Recently, the biotechnology industry has jumped on board with this trend, offering bus transportation from the suburbs into new facilities in Boston and Cambridge. Companies such as Vertex, Biogen and Genzyme have shuttle bus services to the city from suburban locations. These services are expanding rapidly to improve the quality of life of prized, highly skilled employees who want to work in Boston but do not want to sit in traffic for three hours a day.

 A Thoughtful Approach

The latest trend is just now evolving and will involve multifamily residential developments. As Boston continues its housing boom, land developers are finding that the transit system is over capacity and unreliable, two characteristics that are not helpful when trying to lease an apartment targeted to the urban demographic. To solve this problem, land developers are turning to transportation network companies, like Bridj, to fill the gap between available transit and tenant expectations. On-demand shuttle services are proving to be more convenient than the MBTA and provide faster service to key employment centers, such as Kendall Square and the Seaport. And they are competing on cost, as well.

All of these new mobility options are propping up our transportation system, despite a lack of direct taxpayer investment (we are, of course, paying for these services in costs passed through by these private entities). There are consequences to the creation of all these new mobility options. Our roads are becoming clogged with independent shuttle systems, circulating all day on city streets. Our curb space is becoming cluttered with shuttles picking up and discharging passengers. We have literally dozens of shuttle systems operating without any coordination or unifying service plan. These are the very conditions that led to the establishment of government-run mass transit systems in the 20th century. We did not learn the lessons of nearly 100 years ago, when Boston’s transit system was a network of privately operated systems. Due to the chaos of all the operators, the city stepped in to take control of the private entities and operate them as a unified transit system.

As the state of our transportation system continues to evolve, it will be important for Greater Boston and the state to consider this trend. Thoughtful planning can solve the issues associated with privatized transit, without putting the government in charge. Unfortunately, the current state of affairs is unregulated chaos.