Vanpooling and Transit Agencies Module 3: Benefits to Incorporating Vanpools into a Transit Agency s Services A common theme we heard among the reasons why the transit agencies described in Module 2 began a vanpool program was to respond to customers needs. It is clear that vanpools can complement transit agency operations to fill gaps that the regular fixed or demand-response routing cannot. In fact, there are at least six ways in which transit agencies can benefit by offering vanpool service: First, vanpools help a transit agency provide better customer service. Second, offering a vanpool program allows a transit agency to provide an economical transportation option for both the agency and the riders. Third, a vanpool program may help transit agencies respond to state or local requirements, such as requirements to reduce congestion on area roads. Fourth, offering a vanpool program can further enhance a transit agency s public image. Fifth, by recording the ridership numbers in a vanpool program, an urban transit system may be able to qualify for additional federal funding. And sixth, when transit agencies implement a vanpool program, they help to preserve the environment. Looking at the first reason we mentioned, In what ways do vanpools help a transit agency provide better customer service? As mentioned in Module 1, by offering this flexible service, transit agencies are demonstrating that their top priority as a public mobility agency is to implement services that best respond to customers needs. The rewards of providing good customer service including increased community support and a positive public image are immeasurable. Vanpools are a quick start solution. A new vanpool program can be put in place faster than a new bus route, and once the program is in place, adding a new vanpool route requires only a small effort, so transit agencies can respond almost immediately to emerging needs. Vanpool routing is flexible and customized, as it is determined primarily by the riders. The riders choose where they will meet the van and if it will pick up and drop off passengers at a single or multiple stops. Vanpools can take riders to the closest transit stop, particularly from origins located far away from the transit system s hub. For example, the transit agency Pace Bus, operating in the 1
Chicago region, provides vans to commuters to cover the distance up to 10 miles one way between a public transit station and their work or between a public transit station and their home. This allows commuters to leave their cars at home; extends the functional life of a vanpool vehicle by continuing its use for short trips; and reduces the volume of individual cars parked at transit stations. Vanpools can stretch an agency s operating hours. Because vanpool scheduling is established according to a small group of riders needs, and because it doesn t need to be tied to a transit agency s operating hours, the service can effectively broaden a transit agency s hours of operation. Vanpools can travel where bus routes don t go. Many agencies use vanpools to extend the reach of transit services into areas not well served by fixed-route public transit. For example, in Houston, the vanpool program covers an 8-county area, far beyond the service area of the transit authority. Vanpools can provide access to jobs in suburban or rural areas. This can be seen, for example, in the many military installations that use vanpools to help their personnel travel to bases often located far from city centers, thus decreasing the number of parking spaces needed on base and traffic congestion at the secure entrances on base. It also provides military families with a way to save money by not having to purchase an additional commuting vehicle. Vanpools can also fill in gaps in transportation services for workers with jobs located in sprawling suburban areas, where company locations are dispersed and far from existing transit routes. Finally, vanpools can attract a new rider base to a transit agency s services. Some community members may wish to use existing public transportation services but cannot because the routing or schedule may not match their travel patterns. Vanpools, however, with their customized routing and scheduling, may be a more attractive option for these community members and be just the service that lures them from driving to work alone. A second benefit to a transit agency offering a vanpool program is that it allows them to provide an economical transportation option for both the agency and the riders. For an agency, a vanpool program can provide these financial benefits: Depending on how they are set up, vanpools can be wholly or mostly self-sustaining. Generally vanpool riders split the cost of the vanpool, including fuel and maintenance and the insurance costs. Thus the actual operating expenses of the vanpool are cost neutral. If a vanpool program is operated in-house, the transit agency then covers the administrative costs for the vanpool 2
program, including setting up the vanpool ridership, collecting ridership data, and processing payments. If the vanpool program is operated through a third-party, administrative costs can be factored into rider fees. Even with the administrative costs, a vanpool service can cost an agency less than if it were to respond to customers needs by offering a peak-hour commuter service. Vanpools are far less expensive to purchase then full-size buses. Another option is to lease the vanpools and fold the cost into riders fees. For example, Ben Franklin Transit in Washington State began its vanpool service using leased vehicles until it had the necessary capital funds to purchase its first vans. And, as mentioned earlier, vanpools are an economical way to respond to the need for longdistance service or service in low-density areas where the cost to run a fixed-route bus service may be cost prohibitive. Vanpools can be equally cost-effective for riders: It allows them to split the cost and responsibility of the trip into work among fellow passengers, thus saving the rider from shouldering this burden alone. It also saves on wear-and-tear for private vehicles that otherwise would have been driven to work, again saving the rider money. Vanpools are a cost-effective option for long-distance travel, such as for trips of 15 miles or more. This is because, as the costs of travel, based on mileage, increases, the cost savings to participants to split those costs increases. For example, in Washington state, a group of teachers were each driving alone 70 miles to their school and paying $400/month each. Once they formed a vanpool, their costs were reduced to $135/month each. Another financial incentive for commuters who travel by vanpool or public transit is the Commuter Tax Benefit. This benefit, administered through riders employers, allows the riders, and potentially their employers, to save on federal taxes by paying for their commute with pretax dollars. Learn more about this in the resources provided with this module. A third reason transit agencies may implement a vanpool program is to respond to state or local requirements. For example, Washington, California, and several metropolitan areas have laws that require them to reduce the amount of commuter traffic on their roads. Employers over a certain size are required to provide incentives to employees to try transit, vanpools, or other options to driving alone. By working with a local transit agency or vanpool provider, an employer can comply with these requirements. 3
In addition, adding vanpool revenue miles to a transit agency s other revenue miles can help to boost the farebox recovery ratio, or the ratio of revenue collected through fares to the cost of running the transit service. Some states (California and Maryland, for example) have set minimum ratios for transportation agencies; because vanpools can have a very high even as high as 100%--ratio of revenue to expenses, when added to the ratio for buses or trains, the data can strengthen the overall farebox recovery ratio. A fourth reason to offer a vanpool program is to further enhance a transit agency s public image. A transit-branded vanpool with a high level of customer service can support the transit agency s having a very positive public image. Vanpools show that a transit agency can adapt quickly to changing employer or worker transportation needs, and thus provide an effective option for ensuring employees can arrive at work consistently on time. A fifth reason for implementing a vanpool program is to qualify for additional funding. This applies only to agencies that receive urban transit funding (known as Section 5307 funding) from the Federal Transit Administration, or agencies located in designated small transit intensive cities (see the link to the list of transit intensive cities included with this module). To do this, transit vanpool revenue miles are reported to the National Transit Database along with the agencies bus revenue miles, thus increasing their total number of revenue miles, which plays into the formula by which they are allocated federal funding. 1 A sixth area in which transit agencies benefit when they implement a vanpool program is to help preserve the environment. Each 15-passenger vanpool has the potential to remove 15 cars from the roads, thus reducing vehiclebased pollution. This positive impact is further amplified when you consider that some of those 15 cars may not be newer models, and thus may emit more pollutants, whereas most vans are in operation for no more than 5 years, and thus are newer models that emit less pollutants. Another environmental advantage to using a single van over multiple cars is that the van takes up much less space in a parking facility. This could help reduce the need for paved parking spaces, and potentially lead to more green space surrounding buildings. For existing work sites that are applying for LEED certification, documenting the number of employees who switch from driving alone to using an alternative mode such as vanpooling, carpooling, cycling, walking, or taking transit can add LEED points. Transit agencies can partner with new or existing companies, or a transportation management association if one exists in the region, to plan vanpools or transit services. 2 1 http://www.fta.dot.gov/7926.html 2 http://www.usgbc.org/node/2613721?return=/credits/existing-buildings/v4 4
We ve reviewed many compelling reasons for transit agencies to consider integrating vanpooling into their services. To recap, vanpools Provide good customer service Provide an economical transportation option for both the agency and the riders Help communities respond to state and local requirements, such as commute reduction ordinances Further enhance a transit agency public image Help transit agencies qualify for additional federal funding, and Help preserve the environment Module 4 will look at different strategies for implementing a vanpool program. 5