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1 Introduction BACKGROUND Transit agencies have long relied on private sector partners to assist in delivering services, looking to contractors for fixed-route and paratransit operations, and sometimes relying on taxi and/or human services transportation providers to increase the cost efficiency of ADA paratransit. Historically, both public and private operators offer mobility services to the general public and specialized populations. However, a multitude of new private mobility service providers has emerged in the last decade, as shown in Figure 1-1. These services leverage advances in mobile technology and digital platforms to connect customers with mobility options. A large class of these new providers is Transportation Network Companies (TNCs), which are the specific focus of this research effort.2 2 Microtransit services are distinct from TNCs, though some companies who provide TNC service also operate microtransit services. Microtransit is defined by TCRP Report 196 as âprivate services that operate passenger vans or small cutaways and develop routes and stops in response to customer input and demand, generally with tech-enabled booking and payment.â This report does not include consideration of partnerships between transit agencies and microtransit services. TCRP Report 196, âPrivate Transit: Existing Services and Emerging Directionsâ covers these partnerships. 1-1
1-2 Figure 1-1 Taxonomy of Mobility Service Providers, based on TCRP Report 196, Table 1 Service Type Stop Configuration Service Configuration Ride Request Format Fare Collection Access Requirements Private Market Services On-demand exclusive services (unshared taxis or TNCs) ï§ One-to-one ï§ Demand responsive ï§ On-demand ï§ Online/app ï§ Cash ï§ Credit ï§ Technology restrictions On-demand pooled services (shared taxis or TNCs) ï§ Many-to-many ï§ Demand responsive ï§ Zone route ï§ On-demand ï§ Online/app ï§ Cash ï§ Credit ï§ Technology restrictions Pre-arranged route- or zone-based services (microtransit) ï§ Few-to-few ï§ Few-to-one ï§ Fixed-route ï§ Zone route ï§ Pre-arranged ï§ Ticket ï§ Online/app ï§ Technology restrictions Flexible route-based services (jitneys, dollar vans) ï§ Many-to-one ï§ Few-to-one ï§ One-to-one ï§ Fixed-route ï§ Route deviation ï§ Request stop ï§ Street hail ï§ No arrangement ï§ Cash ï§ Ticket ï§ General public Sponsored Services Employer-based commuter services ï§ One-to-one ï§ Fixed-route ï§ Request stop ï§ No arrangement ï§ Free/subsidized ï§ Online/app ï§ Ticket ï§ Employee only Property-based services ï§ Few-to-one ï§ One-to-one ï§ Fixed-route ï§ Request stop ï§ No arrangement ï§ Pre-arranged ï§ Free/subsidized ï§ Online/app ï§ Ticket ï§ Affiliated only
1-3 TNCs established a market for a new kind of on-demand mobility and grew market share quickly. With growing popularity, particularly among younger, more affluent, and more educated individuals, coupled with aggressive expansion across the country, more than half of U.S. adults report they have heard of TNCs3 and 21% of adults in major cities personally use them.4 The impacts of TNCs on personal travel choice, vehicle miles traveled (VMT), transit ridership, and other outcomes are of great interest and importance to academic and industry audiences. As such, there are a number of recent studies and initiatives covering these topics, including: ï§ FTAâs Mobility on Demand (MOD) Sandbox Program (2016):5 In 2016, FTA announced $8 million of funding for MOD public transportation projects. This funding is part of a larger research effort to support transit agencies as they integrate new mobility modes into their networks. The 11 funded pilot programs will be evaluated on standardized performance metrics. ï§ TRB Special Report 319, âBetween Public and Private Mobility: Examining the Rise of Technology-Enabled Transportation Servicesâ (2015): A special report commissioned by the TRB Executive Committee to gather industry expertsâ input on recommendations for policy development, regulation, transportation planning, and infrastructure investment as it relates to technology-enabled transportation services, including TNCs. ï§ TCRP Report 188, âShared Mobility and the Transformation of Public Transitâ (2016): Prepared for American Public Transit Association (APTA), this report examines the relationship of technology-enabled shared mobility (including TNCs) to public transportation. It draws on interviews with transportation officials, a survey of shared mobility users, and analysis of transit and TNC capacity and demand. ï§ Schaller Consulting, âUnsustainable? The Growth of App-Based Ride Services and Traffic, Travel and the Future of NYCâ (2017): An independently produced report leveraging New York Cityâs uniquely available data on taxi and TNC trip mileage and trips. It concludes that: TNCs have added to vehicle miles traveled in New York City; that most growth occurred in northern Manhattan and the outer boroughs; and that growth in Manhattan was concentrated in the morning and afternoon peaks and in evenings and weekends. ï§ UC-Davis Research Report 17-07, âDisruptive Transportation: The Adoption, Utilization, and Impacts of Ride-Hailing in the United Statesâ (2017): This study uses a survey of a representative sample of residents of seven major U.S. cities to understand the adoption, utilization, and impacts of TNCs. It finds that 49 to 61% of TNC trips would have otherwise been taken by transit, walking, or biking, or not taken at all, 3 FTA, âShared Mobility FAQs: Controlled Substance and Alcohol Testing Requirements,â available at https://www.transit.dot.gov/regulations-and-guidance/shared-mobility-faqs-controlled-substance-and-alcohol-testing- requirements 4 FTA, âShared Mobility FAQs: Controlled Substance and Alcohol Testing Requirements,â available at https://www.transit.dot.gov/regulations-and-guidance/shared-mobility-faqs-controlled-substance-and-alcohol-testing- requirements 5 FTA, âShared Mobility FAQs: Controlled Substance and Alcohol Testing Requirements,â available at https://www.transit.dot.gov/regulations-and-guidance/shared-mobility-faqs-controlled-substance-and-alcohol-testing- requirements
1-4 and states that TNCs are likely contributors to a network-wide increase in vehicle miles traveled. ï§ TCRP Report 195, âBroadening Understanding of Interplay Among Public Transit, Shared Mobility, and Personal Automobilesâ (2018): This report uses data acquired in partnership from a TNC in addition to information gathered through a shared mobility and transit user survey and four surveys conducted by transit agencies in Atlanta, the San Francisco Bay Area, New Jersey, and Washington, D.C. It might help answer the question of whether to enter into partnerships with TNCs. ï§ TCRP Report 196, âPrivate Transit: Existing Services and Emerging Directionsâ (2018): By studying the spectrum of private transit services and offering case studies, this report informs public and private stakeholders of the ways these services address transportation needs in a variety of operating environments. It includes several case studies of microtransit partnerships. ï§ TCRP J-05, Topic 17-03, âLegal Considerations in Relationships between Transit Agencies and Ride-Sourcing Service Providersâ (2018): This comprehensive review of regulatory responses to TNCs finds that there exists a âpatchworkâ of rules and regulations across jurisdictions, and that partnerships have developed both contractually and non-contractually. The reportâs intended audience is transit agency legal staff, but planning staff will find it a useful resource on topics of procurement, contractual provisions, compliance with federal legislation, litigation associated with TNCs, and risk management issues. ï§ Schaller Consulting, âThe New Automobility: Uber, Lyft, and the Future of American Citiesâ (2018): Relying on recently published research and new data from the National Household Travel Survey, this report finds that TNCs compete mainly with transit, walking, and biking; that shared TNC rides have not offset the vehicle miles traveled impacts of exclusive ride TNC trips; and that TNCs can be a valuable extension of public transit. ï§ SUMC Shared Mobility Toolkit (2016): Prepared by the Shared Use Mobility Center (SUMC),this resource includes three interactive tools to âhelp cities and public sector leaders better realize the benefits of shared mobility.â The Shared Mobility Policy Database includes hundreds of shared mobility policies, studies, and strategic plans from around the country. The Mapping and Opportunity Analysis Tool identifies where mobility services are lacking, and which modes might support mobility in those areas. The Benefits Calculator models greenhouse gas, vehicle miles traveled, and other benefits tied to shared mobility growth. This set of research provides the transit industry with the primary considerations transit agencies must have in mind when deciding whether or not to establish a partnership with one or more TNCs. And, while the existing body of literature includes policy recommendations, no one study has yet to identify specific, practical guidance for transit agencies that have decided to pursue partnerships. This report fills that gap. Motivations for Partnerships between Transit Agencies and TNCs Our research reveals several motivations for partnerships between transit agencies and TNCs. These motivations include increasing cost effectiveness, demonstrating innovation, avoiding major capital investments such as park-and-rides, and increasing mobility for existing and/or new transit customers.
1-5 TNCs are motivated to collaborate with transit agencies for several reasons as well. These partnerships increase the visibility of TNCs to potential new customers, demonstrate shared values and good-faith efforts to solve local mobility challenges, reveal the constraints and needs faced by transit agencies, and address shared challenges such as pick-up/drop-off queueing. To date, these motivations have resulted in partnership models that vary according to the target customer and the purpose of the resulting program (e.g., suburban mobility, first mile/last mile access, late night transportation, or alternative paratransit option). And, while partnerships between transit agencies and private mobility providers are not new, partnerships with TNCs present new opportunities and challenges as the partners navigate toward mutually beneficial program models. Opportunities ï§ In some cases, transit agencies and TNCs can support each otherâs growth. TNCs benefit from policies and infrastructure designs that support or encourage first mile/last mile access. Likewise, insofar as TNCs have the potential to shift some trips out of personal autos and into shared trips linked to transit hubs, transit agencies have the potential to capitalize on downstream effects of mode shift away from drive-alone. ï§ Unlike most transit agencies, TNCs collect data on the specific origins and destinations of individual customers, enabling a keen understanding of localized mobility patterns. As managers of mobility, transit agencies are mutually interested in this information, which could be used to refine transit networks. Further, the data orientation of TNCs has the potential to demonstrate specific cost savings, mobility improvements, or other outcomes of interest to transit agencies. ï§ TNCs offer several features not found among other private mobility service providers. These include the ability to request and pay for a ride exclusively through a smartphone; the ability to see the location of the vehicle on its way to pick up a customer; the ability to review and rate both customers and drivers through an app; and the ability to set prices dynamically based on demand. These features might help transit agencies achieve goals beyond the provision of trips, such as improvements to customer satisfaction. ï§ TNCs are customer-service oriented. TNCs have the ability to revoke driversâ ability to participate in the platform based on customer reviews. TNCs also have the ability to revoke customer privileges based on the reviews of their driver-partners. ï§ TNC fleets are independent of transit agency-owned vehicles. TNC drivers typically use their own personal vehicles for service, rather than a company-owned, maintained, and/or insured fleet vehicle. This provides an opportunity to right-size vehicles for context and need, offering potential cost savings and other benefits. ï§ TNCs are data-oriented. Transit agencies are interested in partnerships for specific, outcome-driven motivations. TNCsâ data can improve transit agenciesâ understanding of progress toward specific goals, such as cost savings, increased access to transit, or increased customer satisfaction. Challenges ï§ Some transit agencies considering partnering with a TNCs have expressed uncertainty about the interpretation of and adherence to existing federal requirements (e.g., Title VI of the Civil Rights Act, the Americans with Disabilities Act (ADA), and National Transit Database (NTD) reporting). Since the earliest partnerships were started, FTA has made significant progress in clarifying what is required. Some outstanding questions on partnership requirements were addressed in FTA guidance, which reminded
1-6 transit agencies of their obligation to ensure equity and access when developing partnerships to improve mobility at lower cost. The letter included clarifying language indicating that the use of federal funds triggers Title VI and re-confirmed that the ADA applies to partnerships regardless of the source of funds. Still, though most transit agencies use local funding sources and structure partnerships to make accessible vehicles, cash pay, and phoned-in requests available, there is limited data to gauge how well people with disabilities and other protected classes are being served in these pilots. ï§ Though operational information is available, TNCs seek protection of their data. Historically, coming to agreement on which data points are needed and what can be shared has been a common challenge within prospective transit agency-TNC partnerships. ï§ For its driver-partners, TNCs review driving records and criminal backgrounds through state DMVs and third parties. Unlike other commercial drivers, TNCsâ drivers do not undergo fingerprinting, physical exams, or drug testing, and generally do not receive any specialized sensitivity training (except in a few cases in which the TNC partners with a local non-profit or has structured its business model to target these customers). Unless multiple options are made available to customers (e.g. two TNCs or a TNC and a taxi), recipients of federal funding must require drug and alcohol testing of drivers.6 TNCsâ less comprehensive background check process poses a liability concern to some transit agencies considering partnerships â sometimes large enough for the transit agency to delay or forego an agreement. ï§ TNCsâ original business model was business-to-consumer, not business-to- government. Unlike private operators hired to provide fixed-route public transit or ADA paratransit services, TNCs have attracted a large customer base on their own, outside of partnerships with transit agencies. As such, their businesses are not structured for government contracting. Thus, a partnership with a transit agency that often has varying regulations can pose a hurdle to reaching basic agreement terms. 6 FTA, âShared Mobility FAQs: Controlled Substance and Alcohol Testing Requirements,â available at https://www.transit.dot.gov/regulations-and-guidance/shared-mobility-faqs-controlled-substance-and-alcohol-testing- requirements
1-7 RESEARCH OBJECTIVE As described in the original call for proposals, âResearch is needed on existing and potential collaborations and partnerships between public transportation and TNCs to increase understanding and support effective decision making in this emerging area.â7 As such, the objective of this research is to produce practical guidance for decision makers to enhance understanding and to facilitate informed decisions on where, when, and how partnerships between transit agencies and TNCs should be considered and pursued. In this report, based on our review of 20 past, current, and in-development partnerships between transit agencies and TNCs, we consider: Chapter 4: Case Studies ï§ Motivations for entering into partnerships ï§ Regulatory considerations examined as part of the partnership design, including identification of barriers, risks, and legal restrictions at the federal, state, and local levels that make agreements between transit agencies and TNCs challenging ï§ Methods for marketing pilot programs to customers ï§ Methods and metrics to measure outcomes or indicate success of partnerships ï§ Funding mechanisms and budgets used to establish partnerships Chapter 5: Findings ï§ Data and information requirements of transit agencies and TNCs ï§ The range of benefits and outcomes that transit agencies, communities, and customers have pursued through partnerships ï§ The challenges faced by transit agencies as technology-enabled services are implemented and expanded Chapter 6: Partnership Playbook ï§ Options for structuring partnerships ï§ Strategies for mitigating barriers, risks, and legal restrictions, implemented and under consideration, that may ease the development of partnerships ï§ Mechanisms for accountability for TNCs, whose ability to be responsive to public transportation agencies may be affected by market forces Chapter 7: Needs for Further Research ï§ Needs for further research, such as imaginative future scenarios, beyond current experience 7 TRB, âTCRP J-11/Task 26: Collaborations and Partnerships between Public Transportation and Transportation Network Companies (TNCs),â available online at http://apps.trb.org/cmsfeed/TRBNetProjectDisplay.asp?ProjectID=4297
1-8 KEY TERMS This report adopts shared mobility definitions as used by the Federal Transit Administration (FTA). Definitions not covered by the FTA are acknowledged in the footnotes. Key terms used in this report include: ï§ Microtransit: âIT-enabled private multi-passenger transportation services [â¦] that serve passengers using dynamically generated routes, and may expect passengers to make their way to and from common pick-up or drop-off points. Vehicles can range from large SUVs to vans to shuttle buses. Because they provide transit-like service but on a smaller, more flexible scale, these new services have been referred to as microtransit.â8 ï§ Mobility on Demand (MOD): An integrated and connected multimodal network of safe, affordable, and reliable transportation options that are available and accessible to all travelers. Also used to refer to the MOD Sandbox Program, which âprovides a venue through which integrated MOD concepts and solutions â supported through local partnerships â are demonstrated in real-world settings.â ï§ National Transit Database (NTD): âA reporting system that collects public transportation financial and operating information.â ï§ Paratransit: âComparable transit service required by the Americans with Disabilities Act for individuals with disabilities who are unable to use fixed-route transportation systems. [49 CFR 37.3]â ï§ Shared-Use Mobility (or Shared Mobility): âTransportation services that are shared among customers, including transit agencies; taxis and limos; bike sharing; car sharing (round-trip, one-way, and personal vehicle sharing); ridesharing (car-pooling, van-pooling); ridesourcing; scooter sharing; shuttle services; neighborhood jitneys; and commercial delivery vehicles providing flexible goods movement.â ï§ Transit (also referred to as Public Transportation): âTransportation by a conveyance that provides regular and continuing general or special transportation to the public, but does not include school bus, charter, or intercity bus transportation or intercity passenger rail transportation.â This report considers TNC partnerships with transit agencies that report to the National Transit Database. ï§ Transportation Network Company (TNC): âProvides prearranged transportation services for compensation using an online-enabled application or platform (such as smartphone apps) to connect drivers using their personal vehicles with passengers.9â ï§ Wheelchair-Accessible Vehicles (WAVs): a vehicle shall be considered to be readily accessible to and usable by individuals with disabilities if it meets the requirements of [Â§ 37.7(a)] and the standards set forth in Part 38 of this title.â The full list of the FTAâs definitions can be found on their website, https://www.transit.dot.gov/regulations-and-guidance/shared-mobility-definitions and https://www.transit.dot.gov/ntd/national-transit-database-ntd-glossary. 8 TCRP Report 196 notes that not all microtransit is necessarily IT-enabled. Some privately operated jitneys, small shuttles operated by employers, and commercial/residential shuttles may be considered microtransit without adopting smartphone-based dispatch or fare payment. Report 196 offers the broader definition of microtransit as the following: âAt its most broad, almost any flexible service in the space between taxis/TNCs and fixed-route transit, regardless of the mix of public or private ownership or operation.â However, the report states, âas with the on-demand pooled [TNC] services, most microtransit services require a credit card for payment and a smartphone for a arranging a ride.â 9 California Public Utilities Commission, âTransportation Network Companies,â available at http://www.cpuc.ca.gov/General.aspx?id=787