Saturday, January 22, 2011

Public Finance Debts Lead to Reduced Public Transit Service: The Case of Caltrain

Caltrain is a slow moving train that makes too many stops as it takes me from San Francisco to the Stanford area. I don't drive and BART doesn't connect to Stanford so I ride Caltrain.   Caltrain has a huge operating budget deficit.   I'd like to know why.  There aren't too many conductors on the trains so where does the money go?  Is there a huge amount of public works to upgrade and improve the train tracks?

Caltrain is cute but quite slow. It makes Amtrak look like a racehorse.  You can quickly get a sense of how many stops Caltrain makes and the time between stops from clicking here. To provide a sense of its speed, the local weekday train takes 51 minutes to go from San Francisco's 22nd Street to Palo Alto.   According to google maps these two locations are 25.5 miles apart; so this train moves at an average speed of 30 MPH.

Is that a high or low speed?  The 280 Highway runs parallel to Caltrain and its speed limit must be 70 mph. I realize that it becomes congested at peak times.    So, depending on your value of time and your distaste for a variable commute time;   Caltrain might be a better deal at rush hour on weekdays but the highway is the way to travel on weekends and off peak.   If this simple algebra is true, then is it a tragedy that Caltrain is considering;


  • Weekday trains would be reduced from 86 to 48, with service limited to commute hours.


  • No weekend service, eliminating up to 68 trains   



  • My solution to this deficit problem would work as follows;

    1. Institute road pricing on the 280 Highway and earmark 15% of the revenue collected to Caltrain.
    2. The peak time road pricing on the 280 would allocate resources efficiently and would nudge some drivers to substitute to Caltrain.
    3. With the peak time road pricing in place, demand for Caltrain would become more inelastic and it could raise its peak time fares.

    Economists can improve your quality of life!  Please consider our humble suggestions.

    1 comment :

    patel_akhil said...

    Or you could fund the capital investment out of the land value increases that would result from reduced commuting times as train services improved (and if land along the line didn't increase in value as a result of this investment then the market would have determined that this was a poorly guided public investment decision).