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Center Identification Number:  77923 

Project Title: Exploring Opportunities to Expand Public Transportation Services in Florida Through Potential Private Sector Participation: Phase I – Analysis of Contracting for Fixed Route Bus Service

Principal Investigator:

Stephen L. Reich, Program Director
Transportation Program Evaluation and Economic Analysis

Center for Urban Transportation Research
University of South Florida

Phone: 813-974-6435
E-mail: reich@cutr.usf.edu
Fax: 813-974-5168

External Project Contact:     

Diane Quigley
Transit Planning Administrator - Florida Department of Transportation
(850) 414-4520
Email: diane.quigley@dot.state.fl.us

Start and End Dates

Start Date:  March 2010               Expected End Date: March 2011

I.  Project Objective/Problem Statement

As the gap between transportation infrastructure and service needs and available resources continues to grow, elected officials, government executives and transportation professionals are continually challenged to assess and explore methods for operating more efficiently. The Florida Department of Transportation (FDOT) is interested in examining the potential for and issues surrounding greater private sector participation in the provision of public transportation in the state.

Previous experience with the privatization of government functions implies that the shift to the private sector can be most effective when there is a strong need for flexibility, the extent and level of the service is easy to quantify, and the private sector has more expertise than a government entity in an area. Privatization has been shown to be less than ideal in circumstances where potential cost savings are not easily calculable, effectiveness is overly sacrificed for efficiency, there is a lack of competition, too much of the appropriate government or regulatory control is yielded, and procurement arrangements are not transparent.

In keeping with its tradition of understanding best practices and lessons learned by others, FDOT is requesting CUTR to provide detailed data on this topic through a reallocation of National Center for Transit Research project funds. In this anticipated first phase of study, the Center for Urban Transportation Research will analyze the extent and efficacy of public transit agencies contracting with private providers for the provision of fixed route bus service.

II. Objectives/Tasks

The objective of this research project is to investigate, document, analyze, and synthesize previous privatization efforts for providing fixed route public transportation services in Florida and the U.S. Additionally, the research project will identify potential criteria to be used by policy-makers in deciding the appropriateness of privatizing a public transportation function and provide comparative analysis of cost effectiveness of agencies contracting for bus service and those that directly operate it. The project will exclude the area of paratransit as not to duplicate the efforts already underway related to a forthcoming report sponsored by the Florida Developmental Disabilities Council and The Able Trust. The project will include an estimate of potential savings that might accrue to transit operators in Florida, if it is demonstrated through the analysis that efficiencies can be reasonably expected.

Task 1. Project Management

This task will cover project management at CUTR, including producing required progress reports and carrying out deliverable reviews before submittal to FDOT. A kick-off meeting shall be scheduled to occur within the first 30 days of execution by the university. The preferred method for the kick-off meeting is via teleconference or video conference. At a minimum, the project manager and the principal investigator will attend. The Research Center staff must be advised of the meeting and given the option to attend. Other parties may be invited, as appropriate. The subject of the meeting will be to review and discuss the project’s tasks, schedule, milestones, deliverables, reporting requirements, and deployment plan. A summary of the kick-off meeting shall be included in the first progress report.

Task 2. Literature and Regulatory Review

For this research project, CUTR will conduct a comprehensive review of past studies and reports on the topic of contracting for fixed route bus service in the United States. The Transportation Research Board’s Special Report 258, “Contracting for Bus and Demand-Responsive Transit Services” will provide a valuable historical view as the report includes data and survey results from the late 1990’s into 2000. This task will include consideration of the following issues:

• Federal statutes and rules governing private transit operations • State regulations or laws pertaining to public transportation privatization • Trends and attitudes in the U.S. on the topic • Best practices employed by agencies considering contracting fixed route service • Particular attention to issues and the implications associated with section 13(c) of the Urban Mass Transit Act of 1964

The review of the literature will include academic research, industry data and reports, and trade publication articles on the project topic.

Task 3. Identify Privatization Considerations

In this task, CUTR will draw on the results of the literature review and consultation with industry representatives to develop a matrix of issues to be considered when contemplating contracting for bus services rather than a directly operated model. It is expected that the groups contacted will range from those conducting objective analysis on the topic to those with a particular point of view.

Task 4. Analyze Public Transportation Bus Contracting Trends and Outcomes

CUTR will review all of the agencies in the U.S. and identify those that have privatized part or all of their fixed route bus service using the National Transit Database (NTD). A national profile of agencies will be developed in order to fully understand the extent of privately operated bus service. This analysis will then be compared to the results from TRB Special Report 258 as well as the previous 10 years of data in the NTD to determine trends in the industry and examine any patterns that might exist relating to size, location or other factors associated with U.S. transit agencies. This analysis will examine agencies that directly operate all fixed route service, those that provide service through both means, and those that completely purchase the service.

Using a statistical “cluster analysis,” CUTR researchers will select “peer” agencies for the three combinations of contracting for service. Efficiency metrics will then be developed, calculated and compared for the agencies to determine if there are consistent cost advantages to one method of service provision over the other(s). A series of graphs and tables will be developed to assist in the analysis of the data and for inclusion in the final report.

CUTR will contact selected agencies that are used in the peer analysis described above to determine the motivations for the decisions regarding contracting out, to gather insights into lessons learned, and to document what best practices an agency considering this method of providing fixed route service might consider.

Task 5. Potential Application in Florida

In this task, CUTR will use all of the data and lessons learned collected in the previous tasks to provide a cursory analysis of what potential a higher degree of privatization has for Florida’s fixed-route transit providers. CUTR will examine the extent of contracting by Florida agencies and use existing data to estimate future service needs. The effort will then extrapolate the potential implications for Florida of employing opportunities that may be identified in the course of the study. This task will focus on the potential cost advantages or disadvantages that might be gained for existing and future service in Florida.

In this task and throughout the development of the final report, CUTR will remain sensitive to the local nature of public transportation operations and will not be engaged in making any specific recommendation for any particular transit agency. Rather, the focus will be to provide objective insights on when, where, and how the utilization of private providers might result in benefits to a community that desires to create, maintain, or expand transit services and on overall impacts of a change towards more reliance on private providers might mean for the state.

Task 6. Synthesis of Information/ Final Report

At the conclusion of the project funding period (90 days before the end date), CUTR will summarize and synthesize all of the data collected in the previous tasks and provide a draft final report to FDOT’s Public Transportation Office (PTO). The 90-day review period will allow adjustments resulting from FDOT comments, including any newly identified public transportation privatization initiatives or any legislative proposals that may emerge during the conduct of the research project.

The revised document will result in a synthesis of findings and will serve as the final report. It will be provided to the FDOT Project Manager within 12 months of the notice to proceed. Further details on the final report are described below in the section “Deliverables.”

Work not included in this scope of service is not to be performed and will not be subject to compensation by the Department.

III. Deliverables

Progress Reports

The Principal Investigator will submit quarterly progress reports to the Research Center. The first report will cover the activity that occurred in the 90 days following the issuance of the Task Work Order.

Reports should be submitted within 30 days of the end of the reporting period. Reports are due even if little or no progress has occurred (in which case, the report should explain delays and/or lack of progress). Progress reports should be sent in MS Word to Sandra Bell, sandra.bell@dot.state.fl.us .

Progress reports must include the following information: 1. Contract Number, Task Work Order Number, and Title 2. Work performed during the period being reported 3. Work to be performed in the following period 4. Anticipated modifications (i.e., to funding, schedule, or scope). This section is for reporting/informational purposes, not for officially requesting an amendment. Note: To request an amendment to a contract, the contractor must provide the project manager with the appropriate information (i.e., what is being requested with justification) in the required format. If the project manager concurs with the request, he/she shall forward it with his/her approval and commentary, as appropriate, to the Research Center for administrative review and processing (pending available funds, etc.) 5. A Progress Schedule (figures A, B, and C) updated to reflect activities for the period being reported.

Failure to submit progress reports in a timely manner may result in termination of the work order.

Draft Final Reports

The Draft Final Report is due 90 days prior to the end date of the task work order. The draft final report will be submitted to Sandra Bell, sandra.bell@dot.state.fl.us. It should be edited for technical accuracy, grammar, clarity, organization, and format prior to submission to the Department for technical approval. The Research Center expects contractors to be able to provide well-written, high quality reports that address the objectives defined by the scope of service. Draft final reports must be prepared in accordance with the “Guidelines for Preparing Draft Final and Final Reports.”

Final Reports

Once the draft final reports have been approved, the university shall prepare the final report. The university will deliver a minimum eight (8) copies of the final report in MS Word on CD or DVD. The CD/DVDs should be labeled in a professional manner and include at a minimum the contract number, task work order number, project title and date.

The final report is due no later than the end date of the task work order and should be delivered to the following address:

The Florida Department of Transportation Research Center

MS30 605 Suwannee Street

Tallahassee, FL 32399-0450

I.                  IV.  Project Schedule

                It is anticipated that the project will be completed within 12 months of the written notice to proceed from the Department.

V.  Project Budget

        Total Budget    $74,839

VI. Use of Graduate Student(s) and Other Research Assistants

There will be no need for a graduate student.

VII. Equipment

No need for non-standard equipment is expected for conducting the proposed research. Reimbursement will only occur upon receipt of and only for the amount of the purchasing invoice for the subject equipment. The university, upon receipt of any purchased equipment, shall forward to the Research Center a copy of the purchase invoice/property description as detailed in Exhibit C – Budget/serial number and receipt. The Department will prepare and forward inventory control label(s), which the university shall have affixed to the property.

VIII. Travel

No travel will occur on this project.

All travel shall be in accordance with Section 112.061, Florida Statutes. FDOT employees may not travel on research contracts.

National Center for Transit Research · at the Center For Urban Transportation Research · University of South Florida · 4202 E. Fowler Ave., CUT100 · Tampa, FL 33620-5375 · (813) 974-3120 · (813) 974-5168 · www.nctr.usf.edu · Comments: webmaster@cutr.eng.usf.edu