The board of the Port Authority of Allegheny County, Pa., serving the Pittsburgh metropolitan region, announced last week that it would have to cut services by 35 percent by September 2 — the largest cut ever for the agency — if it is not provided an increase in state aid. The agency expects that it will have to increase fares and lay off 500 workers. This comes a year after the agency reduced services by 15 percent.
The service cuts planned would be, suffice it to say, devastating. The Port Authority’s austerity plans would eliminate almost half of the region’s routes. This is in a city where, according to the U.S. Census, more than a quarter of households have no vehicle available, and almost one-fifth of workers use transit to get to work — figures that are far higher than the national average, or even that of the vast majority of American center cities.
Pittsburgh, of course, is far from alone. From Boston — where a 23 percent fare increase and service cuts were approved a month ago — to Athens, Ga. — where night bus service is expected to be fully eliminated — American cities continue to cut their transit offerings. Friday’s U.S. national jobs report, which showed about 20,000 fewer people working in transit operations in April compared to a year ago (a 5 percent decline), only reinforced the fact that when it comes to transit service, cuts are the rule of the game.
What a paradox: These cutbacks are enforced even as fuel prices continue to rise and the demand for public transportation seems likely only to increase. Local revenues simply cannot keep up with demand.
At least part of the problem is the reliance on local and state revenues to subsidize operations costs for bus and rail services in cities across the country. Whereas the federal government was willing to cover more than half of the costs of a $523 million light rail expansion to Pittsburgh’s North Shore — opened in March — it can do nothing to cover the agency’s $64 million operating deficit expected for next year because of Congressionally imposed rules about what Washington can and cannot pay for.
The counterintuitive result is that cities that are doing well economically are able to pay for improved transit services, whereas those with many economic problems — the ones where transit is often needed most — are left to cut operations dramatically. Thus regional inequities are reinforced.
One argument suggests that if the federal government continues to absolve itself of responsibility for providing for mobility of people across the country, public services like transportation will continue to be cut even if there is an important demand for them — and even if investing in them improves the economy in the long-run. Europe’s current economic crisis, which stems in part from a shared economic zone with differentiated tax rates, divergent social service provisions and a demand that national governments enforce close-to-balanced budgets, has produced an environment in which downscaling of government investment is the norm, no matter the cost.
Is the situation in the U.S. so different? Forty-nine of 50 states, unlike the federal government, have some form of balanced budget rule; cities are almost never able to operate in the red. Meanwhile, competition between states and cities encourages them to lower their tax rates, making the provision of public services all the more difficult. Only Washington is able to borrow during recessions, and thus it must play the role of providing the back-up for public services like transit agencies that are left behind by declining local revenues. Yet current law makes that impossible. The result is reduction in provision despite an increase in need.
An important report from the Center on Budget and Policy Priorities last year, however, suggests that states do have more of an ability to invest in public service provision than they are typically assumed to have. Evidence shows that states that have increased taxes have not seen excessive outmigration, but rather increased government revenues.
What can we take from this? Cities and states like Pittsburgh that are facing massive cuts in public services should absolutely call on Washington to increase its provision of aid to local governments, especially through operations support. But absent that — and in this day and age, we cannot count on Congress for much — raising local and state taxes is a serious option. It takes guts for public officials to promote tax increases, but we need to keep the trains and buses running.