Milwaukee County's Transit Crisis

Coverage of the Public Policy Forum's latest report, "Milwaukee County's Transit Crisis: How did we get here and what do we do now?" appeared in Sunday's Milwaukee Journal Sentinel. Unfortunately, the headline was somewhat misleading. It stated that the Forum is calling for a wheel tax, which we are NOT. This was simply one of a number of options that we identified in the report as possibly helping to solve the financial crisis faced by MCTS if policymakers wish to solve it with a new revenue source. That said, the article did a good job summarizing the Forum's research, which found that policymakers face a stark choice:

They can accept a transit system that is a shell of its former self – one that contains no freeway flyer service, few night and weekend options, and sparse service west of 76th Street, south of Oklahoma Avenue or north of Silver Spring Drive – or they can consider one or more selections from a difficult menu of policy options that could either delay the day of reckoning once again, or perhaps prevent it altogether.

Key findings from the Public Policy Forum's analysis of the Milwaukee County Transit System funding crisis:

• Barring an infusion of new funds from the federal government, the need for federal funds in the system’s operating budget soon will outstrip the amount of funds available by well over $15 million annually. Funding projections developed by the Forum – and reviewed for reasonableness by current and former Milwaukee County Transit System (MCTS) officials – show potential overall shortfalls of $1.6 million in 2009, $18.3 million in 2010, $23.7 million in 2011 and $21.1 million in 2012.


• Since 2001, nearly $40 million of a $44 million reserve of federal capital funds has been allocated by the county to fill holes in MCTS’ operating budget and avoid significant service cuts. At the same time, bus purchases have been deferred to allow for the expenditure of those reserves on operations. The elimination of the reserve and the looming need to replace at least 150 buses sets up an ominous fiscal crisis.


• MCTS not only faces serious funding issues pertaining to fixed route service, but it also must address a growing funding gap in paratransit services for persons with disabilities due to increased demand for those services.


• MCTS’ fiscal challenge has been greatly exacerbated by a new governmental accounting rule that requires the system to budget annually for its long-term liability for retiree health care benefits. This has added approximately $8.5 million per year to MCTS’ operating budget.


• MCTS buses carried 10.3 million fewer riders in 2007 than they carried just seven years earlier, ranking it first among 13 peer transit systems in lost riders from 2000 to 2006. Only once in the last seven years did MCTS see an increase in ridership (a 1.9% increase between 2004 and 2005). The uptick corresponded to the only year that fixed-route bus service was increased.


• The cost effectiveness of MCTS buses was best among peer systems in 2006 based on data from the Wisconsin Department of Transportation and the Federal Transit Administration, indicating that further cost savings due to efficiency improvements may be limited.