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Microtransit Has Broad Appeal, Despite Clear Drawbacks

More public transit agencies are offering low-fare, on-demand shuttle service as a way to connect people to existing transit services and serve far-flung communities. But many transit advocates are wary of the trend.

A microtransit van near Sacramento, Calif. The service has a broad allure for public officials, because it can provide some form of alternative mobility to wide swaths of disconnected communities all at once. Critics say it’s a far cry from the efficiency of mass transit, and a high cost for transit agencies. (Sacramento Area Council of Governments)
In Brief:
  • Microtransit has evolved from pilot programs to being a permanent feature of many public transit agencies in the U.S.

  • The services allow flexible routes and on-demand rides at a low cost to people who aren’t well served by transit.

  • Advocates say it’s inefficient, highly expensive per rider and an opportunity cost for transit agencies that doesn’t increase ridership overall.

  • In 2019 and again in 2020, voters in Gwinnett County, Ga., rejected proposals to expand public transit. In both cases, the proposals would have brought new rail and bus service to the suburban county and created new transit connections with Atlanta. But after both referendums failed — partly because of persistent hostility toward MARTA, Atlanta’s public transit agency — Gwinnett County planners went back to the drawing board. A new plan, which may go up for a vote as soon as next year, eschews expensive rail projects and focuses on moving people around the county.

    Even without big investments in the flashiest transit projects, the plan could transform mobility for county residents, says Ben Ku, a county commissioner. If it’s approved, “I can confidently say that you can get anywhere in Gwinnett County without a car,” Ku told Governing in a recent interview.

    How does a 400-square-mile county with nearly a million people achieve total, non-car mobility overnight? The answer, county planners say, is microtransit. Gwinnett County began running microtransit services, a type of on-demand transit where riders use a phone app to order a shuttle that will pick them up at or near their house, during a pilot phase in 2019. It now runs two microtransit zones, allowing residents to get from any point to any other point within those areas. If its Transit Development Plan is approved, the whole county would become a microtransit zone, and residents could hire a van to get anywhere they need to go.

    Microtransit services, which are typically offered by local governments or public transit agencies but operated by third-party companies, have been steadily spreading in the U.S. for years. They’re similar to ride-sharing companies like Uber and Lyft — and operated by similar types of tech startups — but heavily subsidized like other forms of public transit.

    Microtransit has a broad allure for public officials, because it can provide some form of alternative mobility to wide swaths of disconnected communities all at once. Critics say it’s a far cry from the efficiency of mass transit, and a high cost for transit agencies that doesn’t generate any significant increase in overall ridership. But few anticipate the trend slowing down any time soon.

    How It Works 

    Many cities and rural areas in the U.S. now offer microtransit, either as part of a pilot program or as a permanent part of their transit services. The systems work differently in rural, suburban and urban settings, but in all cases, they let riders pay a small fare to book a ride to a predetermined location. Some systems offer door-to-door or curb-to-curb service; others ask riders to walk to a nearby “stop” to be picked up at the requested time. The main feature of microtransit is that the routes are flexible, rather than fixed like buses and trains.

    Gwinnett County launched permanent microtransit service in two zones, Snellville and Lawrenceville, this past summer. Riders use an app to pre-schedule or request a ride on demand. The app has been downloaded 4,000 times so far, according to Natasha Tyler, the transit division director for Gwinnett County.

    Ridership has gradually increased in the first few months of service, and it’s up 60 percent since the first week of September, Tyler says. The county aims to reach riders within 20 minutes of their request. Its initial goal was to reach four passengers per hour — one for each vehicle in service — with an eventual target of averaging 12 passengers per hour.

    In the early stages, the service has hit its initial target in the middle of the week, and averaged two to three riders per hour on other days, Tyler says. People use it to get to and from afterschool activities when school buses aren’t running, she says, or to get to the Walmart; others ride it to fixed-route bus stops at the edge of the microtransit zones and ride the bus to their final destination.

    That’s been one of the main hoped-for benefits of microtransit around the country — that it will provide “first mile/last mile” connections to existing transit services. County officials are able to tweak the boundaries of the microtransit zones based on where they believe demand is.

    Filling in Transit Gaps

    The appeal for sprawling areas poorly served by traditional transit is obvious, but much denser places are experimenting with microtransit too. One example is in Jersey City, across the Hudson River from New York, where about half the population already commutes to work using public transit. But Jersey City doesn’t control the quality of service at the local level, and many areas of town are still poorly served, says Barkha Patel, the city’s director of infrastructure.

    “We’re one of the most densely populated cities in the entire country,” Patel says. “Even if there are bus lines and light rail [in many areas], frequencies are very poor and headways are too long. We saw that there was a lot of room for improvement and there were a lot of transit deserts within Jersey City.”

    Jersey City launched its microtransit service in 2020, and surpassed a million rides last summer. In the first quarter of 2023, the service completed 162,000 rides, outpacing the city’s goal of at least 10,000 rides a week, and had an average wait time of 18.2 minutes. Demand has increased every time the service has expanded, Patel says. The city created zones to serve people who don’t have good access to transit, and has tweaked them several times to make sure they’re serving riders with the greatest need, targeting neighborhoods with more people of color and lower household incomes.

    Without those parameters, it’s likely that demand alone would mean lots of trips within areas that already have good transit connections, and where people might use the service as a cheap alternative to Uber and Lyft. It’s important not to let microtransit poach riders from existing transit services, Patel says. Jersey City is “very close to that edge where we don’t want to go too much further” with microtransit expansions, she says.

    High-Subsidy Service

    For Jersey City, the ability to quickly launch microtransit to serve specific neighborhoods, without having to plan a bus line or build new infrastructure, was a major component of the appeal. But it still requires a substantial investment from the city. Last year, Jersey City paid $7.5 million to Via, the New York-based company that operates the service, according to a news report.

    Gwinnett County pays a different company, Transdev, to run its service. The cost is $72 per revenue hour, Tyler says. With four vehicles in service 14 hours a day six days a week, that adds up to about $1.25 million a year. If the service gets an average of four passengers per hour, the per-ride subsidy is about $15 per passenger after the $3 fare. Critics commonly point to the high rider subsidy as a mark of the inefficiency of microtransit.

    A Los Angeles Metro pilot program was called "an expensive flop" in 2019, when it was paying an estimated $14.50 subsidy per ride. But the cost has only gone up: More recent reporting puts the subsidy at about $43 per ride. Sacramento’s system has a similar cost per ride, with about 16,000 riders a month, according to a spokesperson for the Sacramento Regional Transit District.
    A Los Angeles microtransit pilot program was called "an expensive flop" in 2019, when it was paying an estimated $14.50 subsidy per ride. But the cost has only gone up: more recent reporting puts the subsidy at about $43 per ride. (American Public Transportation Association)
    All public transit is heavily subsidized, and many officials say it’s worth investing in options for people who don’t live near bus and train lines. But a key question is what microtransit is meant to accomplish. Jarrett Walker, a consultant who helps transit agencies redesign their networks, has written frequently about the competing goals of coverage and ridership for transit providers.

    Agencies may want to cover more total territory with service, often for good reasons, but that comes at the expense of concentrating transit in the areas where it will generate the most ridership. Microtransit makes some sense as a coverage service, Walker has argued, but not if the goal is to get more ridership.

    Labor unions have also been skeptical of microtransit services, especially because some of the tech startups that operate them started out as competitors to Uber and Lyft, which have categorized their drivers as independent contractors rather than employees. Union workers have fought efforts to replace all fixed-route bus service in Denton, Texas, with on-demand microtransit operated by Via. The Amalgamated Transit Union (ATU), which represents transit workers in the U.S. and Canada, says it’s focused on maintaining good jobs for people who run buses and trains.

    “It’s hard to say whether microtransit is here to stay or just a passing fad, but right now there’s no denying its popularity,” says ATU’s international president, John Costa, in an email. “We know all too well that private contractors are more interested in profits than public service, so we’re paying close attention to the companies that are pushing this technology and the impact it’s having on our transit systems.”

    TransitCenter, the New York-based advocacy group, has argued that in addition to being inefficient, microtransit is an opportunity cost for transit agencies. Money and time that agencies invest in on-demand services run by third parties is money and time they can’t spend on improving traditional, high-ridership services, the group says.

    “Our view overall is that these microtransit projects have not lived up to their promises,” says Chris Van Eyken, director of research and policy at TransitCenter. “At the start it was great that folks were trying something new and trying to find new ways to get folks on transit, but it hasn’t really worked.”

    Services should be judged on whether they increase overall ridership on a transit system, Van Eyken says. Microtransit hasn’t been shown to do that. For many communities, it is an appealing option because it looks like a fast, low-cost way to start new transit service. But it doesn’t necessarily provide meaningful mobility at a community or city scale, he says.

    “You can sort of walk away from it not having solved the connectivity issue that that community is facing,” Van Eyken says.
    Jared Brey is a senior staff writer for Governing. He can be found on Twitter at @jaredbrey.
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