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Economic and policy considerations of advanced public transportation systems (APTS)

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Title:
Economic and policy considerations of advanced public transportation systems (APTS) assessing the economic feasibility of APTS
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English
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Ball, William L
National Urban Transit Institute (U.S.)
University of South Florida -- Center for Urban Transportation Research
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Center for Urban Transportation Research
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Tampa, Fla
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Local transit -- Technological innovations   ( lcsh )

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William L. Ball, principal investigator.
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"OCtober 1994."
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Issued as a project of the National Urban Transit Institute.

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usfldc doi - C01-00099
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.J .. II. National u:,L Urban .1d0'Transit ....... "1!+111"" Institute at the CENTER FOR URBAN TRANSPORTATION RESEARCH University of South Florida Florida State University Florida A&M University Florida International University ECONOMIC AND POLICY CONSIDERATIONS OF ADVANCED PUBLIC TRANSPORTATION SYSTEMS (APTS) Assessing the Economic Feasibility of APTS William L. Ball Principal Investigator Center for Urban T ransportation Research University of South Flo rida October 1994 CUTR Center for Urban Transportation Research College of Engineering, University of South Florida 4202 E Fowler Avenue, ENB 118 Tampa, Florida 33620-5350 ph (813 ) 974-3120, fax (813) 974-5168

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TlCHNICAL REPORT STANOARO tmJ! PAG E 1 Ropott No. 2 Gotemment AccessiOn No. 3. Catal.og No. NUT I 93USF5 2 4. nu. o1ne1 So.btllllo &.. Ropon 0.:.10 ECONOMIC AND POLICY CONSIDERATIONS OF ADVANCED PUBLIC October 1 994 TRANSPORTATION SYSTEMS (APTS), ASSESSING THE ECONOMIC 6 Pedcrmi:t; O rpn:aucn C oer. FEASIB I LITY OF APTS 7 Autl'lorll) 8 Pedtxmi:t; OrgMiul.icn Roport No. William L. Ball Research Associate 9. PMIOtminq Nemo ordAdeteu 10. \Votlt UrrOI No. National Urban Institute Center for Urban Transportation Research, University of South F l orida 11, Contractor Otani No. 4202 E. Fow ler Avenue ENB 1 1 8 Tampa, F l ortda 33620 5350 DTRS 93-G-Q019 12 N/fiN;'I fWI'II 1t11:1 Adlhu 13. l)po tf Roport ancJ P..-IO!S Coverod Office of Research and Spec ial Programs Admi nist rat i on July 1993 through October 1994 U.S. Department of T r a n sportation Fina l Report (2 of 2) Washington, D C 20690 14. SPQtdot
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TABLE OF CON T ENTS Acknowledgements . . . . . . . . . . . . . . . . . . . . . . . i v Abstr act . . . . . . . . . . . . . . . . . . . . . . . . . . . v Executive Summary . . . . . . . . . . . . . . . . . . . . . . 1 I. II. Ill IV. v VI. I ntroduction ... ... ............. .................... ........ APTS T echnologies . . ..... ..... ......... .... . .... . ..... APTS Evaluation ... . ....... ..... ..... .......... Gene r al Assessment .................... . ........... . ..... Alternative Investments Analysis ...... ..... .... . . .... . ..... Breakeven Analysis ............. ...... ................ ..... 1 1 14 18 24 49 61 Append i x A: List of Co n tributi n g Agenc i es . . . . . . . . . . . . . . . 68 Appendix B: List of APTS Tec h no l ogy Vendors . . . . . . . . . . . . 70 References . . -. . . . . . . . . . . . . . . . . . . . . . . 7 5 iii

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ACKNOWLEDGEMENTS This project is made possible through a grant from the U.S. Department of Transportat ion University Research Institute P rogram Their support is gratefully acknowledged A National Urban Transit Institute was established as part of the lntermodal Surface Transportation Efficiency Act (ISTEA) of 1991. Headquartered at the University of South Florida's (USF) Center for Urban Transportation Research (CUTR), the Institute is a consortium of USF, Florida Agricultural and Mechanical University, Florida International University and Florida State University. "Economics and Policy Considerations of Advanced Public Transpo rtatio n Systems (APTS)" is one project funded as part of the first year of the Ins titute's research program The objective of this project is to advance the state-of-the-art in assessing the economic feasibility of adapting APTS to public transportation systems. A companion document, "Backg round and Review of Evaluation Approaches" provides an overview of APTS technologies and a review of the various approaches that have been used in evaluating the technologies prior to this report National Urban Transit Institute Center for Urban Transportation Research College o f Eng ineering University of South Flotlda 4202 E. Fowler Avenue, ENB 118 Tampa, Florida 33620.5350 (813) 974 fax (813) 974-5168 GaJY L. Broscll Director CUTR Project Team: William L. Ball, Project Manager/Research Associate Michael C. Pielr2yk, ITS Program Manager Steven E. Polzin, Deputy Director for Policy Analysis Eric Hill. Research Associate Amy Pol.k. Research Associate Ray Yettew Student Research Assistant Rob Nevins, Student Research Assistant Tony Rodriguez. Student Reuarch Assistant Review and comments from the following individuals are gratefully acknowledged: Patricia A. Henderson, Dennis Hinebaugh, Edward A. Misrzejewski, Steven E. Polzin iv

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ECONOMIC AND POLICY CONS IDERAT IO N S OF ADVANCED PUBLIC TRANSPORTATION SYSTE MS (APTS): Assessing the Economic Feas i bility of APTS ABSTRACT This rep ort provi des a descript ion and discussion of Advanced Pub l ic T r ansportat io n Systems (APTS) techn ologies, and then focuses on met hods for assess i n g the e co nomi c feasib ilit y of implemen t ing these technologies Three eva luation techn i ques are presented, includ i ng a genera l assessment, an alternative investments analysis and a b r eakeven ana lys is. First, a general assessmen t is presented which provides a b rea kdown of costs collected for seven APTS techno logi es inc lu ding automat i c vehic le locat i on (AVL) automatic passenger coun t ers (APCs), advanced fare p a yment media, c omp uterized tel ep hone information systems computer ized di spatching/sc h e duli n g passenger infor mat i on displays (PIDs), and annunc i ators. This is f oll ow e d by t h e i den t ifi cat i on and qua lita t i ve assessment of the po t ential benefits of th ese t echnologies. Se co n d an al t ernative invest ments ana lysis was developed and is designed t o analyze the potent ia l i mpacts of us ing p r o p osed APTS fun ding for more tradi t io nal transit i nvestments such as an i ncrease in the leve l of service a re du cti o n in t h e average fare, or an expans i on of tra di t i onal mar ke t ing act iv iti e s Third a breakeven ana l ysis (deve loped by Mor lok, et a l. i n 19 91) i s presented and update d us in g fiscal yea r 1992 na t io n al transit statistics to est i mate t he re duced number o f buses and/or revenue miles necessary to break even on an i nvestment i n an Automat i c V e hicle Location (AVL) syste m that includes advanced communications ca p ab ili ty I n addition t h e analys is i s extende d t o est imate some of t he external b enefits that p otentia lly could r esult from t h e imp l ementat io n of an AVL system.

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EXECUTIVE SUMMARY Advanced Public Transportation Systems (APTS) are advanced navigation and communication technologies applied to all aspects of public transportation. The purpose of these advanced technologies is to increase the timeliness and availability of passenger informat i on and to improve the conven ience, reliability, and safety of transit service The primary objective of this report was to provide methods for assessing the preliminary feasibility of APTS investments for a transit system. Seven technologies were selected for more detailed analysis and consideration based on transit industry interest as measured by applications presented in the literature, case studies and presentations at national conferences, and the anticipated availability of information on costs and benefits of the respective technologies. These technologies i nclude: 1. Automatic Vehicle Location (AVL) AVL provides continuous tracking of vehicles through devices as simple as an on-board transponder communicating with a roadside signpost to sophisticated Global Positioning Systems (GPS) licensed for tracking by lhe U.S. Department of Defense. AVL usually is linked to a radio system enhancing driver dispatcher communication. Real-time vehicle location through AVL can provide the potential for improv ing ont ime performance by generating trend data to bette r plan schedules and routes 2. Automatic Passenger Counters (APCs) APCs aut om ate the passenger counting function. The technology enables the collection of boardings and alightings at each stop along with the time and date associated with each alighting and boarding. APCs can provide lhe benefits of more efficient use of vehicular and personnel resources and in creased operational productivity through accurate ridership counts. 3. Advanced Fare Payment Media -Advanced Fare Payment eliminates the time and effort required for fare payment during a transit trip by automating the transaction The automated payment function can take the form of debit cards or "smart" cards. DeM cards are magnetic stripe cards (e.g. credit cards) and are constructed of either paper or plastic. This type of card already is used by a number of transit agencies today. Smart cards, also the size of c redit cards can be contac t (inserted into a reader) or contactless (wireless transmission). The smart card technology for advanced fare payment media also allows for variable fare structures. The primary objective is to eliminate or reduce the on-vehicle delay caused by fare payment. 4. Computerized Telephone Information Systems The primary objective of advanced telephone information systems is to better inform transit users about transit service i.e., 1

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routes schedules, etc. Potential t ransit users can call the networ1< control cer.ter and describe where they are and where they want to go. Based on this request, a human operator or voice-synthesized operator can respond qu ickly to determine the best route for callers to take and can p rovi de information. such as necessary transfers, the nearest stop, and the next scheduled bus Automation of information provided over the telephone allows more calls to be answered by fewer operators in multiple languages. 5. Computerized Dispatching/Scheduling This is an extension of Computerized Telephone Information Systems and AVL, enabling a passenger to call (voice or touch tone) for transportation to a desired destination. The computer selects the bus that best serves the transit patron. Buses may deviate from established fixed r outes or may be summoned directly on demand Reservations also can be made by users of the system. This concept was successful in the United States in the 1970s (with small fleets) when dispatching was manual, and now is working extremely well in Germany, where the system is referred to as FOCCS (pronounced "fox") An operational test of a similar system is being conducted in Portland, Oregon. This techn ology offers the potential to serve sprawling development with fewer, and perhaps smaller vehicles. Inform ation also can be provided in multiple languages 6 Passenger Information Displays (PIDs) -The type of information availab le to the user varies by the system Computerized telephone informat ion and dispatching systems can communicate real-time. on-demand information requests directly to the trans i t user through PIDs, or kiosks Displays can be passive-showing differen t schedules, areas, routes, etc.-or interactive-show i ng users exactly what inform ation they want to see. A passenger information display can enable passengers to plan their routes by origin and destination points. PIDs are most effective at trans fer locatio ns major public facilities (regional shopping malls, civic centers stadiums, hotel complexes, etc.) and arrival points (airports, bus stations. e tc.). For example if installed at mode transfer stations, passengers can determine when the next bus will a rrive at the stop. From this determination, the passenger can wait for the bus, change modes, or spend time more efficiently while waiting. Information also can be provided in multiple languages. 7. Annunciators (Talking Bus) Annunciators also known as "Talking Bus," provide a recorded voice to announce stops on the r ou t e In addition to providing a new service to transit patrons, annunciators can help meet compliance requirements of the Americans 'Robert w. Behnke, Gennan "SmattBus" SysJems: Potential for Application in Portland, Oregon (Volumes 1 and 2) ( U .S. Department of Transportation. Federal Transi t Administration. January 1993). 2

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with D i sab ili ties Act As with computerized telephone information systems and PIDs. information also can be provided i n multiple languages From a strict econom i c perspective, a comprehensive benefiVcost analys i s ( BCA ) should be conducted to assess th e feasibil i ty of a series of investment altematives including APTS and more traditional transit investments However given that empirical data on the benefits of various APTS investments are limited and that the magnitude of these benefits could vary significantly by location, a comprehensive BCA may not be feasible for most transit systems due both to resource and da t a limitati ons For this reason, three altern at i v e eva luation options were offered In this report to assist in the pre liminary assessment of APTS investments. This will in turn provide some additional guidance for the APTS decisionmaking process at transit systems throu ghou t the United States. The three evaluation methods inclu ded the general assessment, alternative investmen ts analysis and breakeven analysis GENERAL ASSESS M ENT The genera l assessment provides a basic discussion of costs and benefits associated with each of the seven technologies. Cost information was so li cited from the literature and trans i t systems throughout the Un i ted States. It was discovered that public availability of APTS technology costs is extreme ly limited This is due to the proprietary nature of the costs in general, and the fact th at bids have not yet been formally requested for all seven technologies that were selected for analysis. Despite data lim i tations a significant amount of cost infor m a t i on was compiled and should prove useful to transit systems contemp l ati ng APT$ investmen t s APTS Costs Costs of selected APTS technologies w ere so li cited from trans i t systems throughout the U S and Toronto as w ell as through literature review A good rep r esentation of costs wa s obta ined for AVL systems ; however limited cost i nformat i on was obta ined for advanced fare paymen t computerized d i spatch i ng/schedu li ng and annun ci ators Cost information for APC systems computerized telephone i nformat i on systems and P I Ds i s lim i ted even further to anecdotal inform a tion co ll ected through review of ava il able benefit-cos t reports a nd d i scussions with professionals in the transit industry. Where poss i ble, bid tab summaries were collected to prov ide as much detail as possible regarding the componen t costs of each techno logy inv estment. The presentation of c o st information focuses so l ely on the estimation of cap i tal costs Virtu a ll y n o data were collected describing the cost of operating and maintaining these technolog ies In a survey conducted by Morlok trans it agencies with experienc e in AVL indicated that operating and maintenance costs of this technology are relat i vely small and believed to be offset by related 3

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cost savings (e.g., lower administrative and data costs).2 However no references to the operating and maintenance costs associated with the implementation of the remaining APTS technologies were identified. As a result, discussion of these costs is excluded from the analysis and left for future research. An additional consideration that is not reflected in the presentation of costs involves the designation of fixed versus variable costs. Most of the technology investments are likely to include significant fixed costs that would be required regardless of the size of the transit system. In addition, a portion of the investment also will include variable costs that will change with the number of buses that the t ransit system operates. The amount of fixed and variable costs as a percent of the total investment will vary significantly with the type of technology that is selected for implementat ion. For example, the fixed costs associated with an AVL system using GPS technology is expected to be much greater than those associated with a system using the signpost technology. Due to the lack of detailed cost infom1ation, fixed and variable costs have not been distinguished in the presentation of costs Despite the recognition of this shortcoming, the cost tables presented in clude a per bus cost in each example This in no way means that all technology costs are variable. This is included to enable transit systems to develop a general sense of the magnitude of total investment required for a given APTS technology Prior to mak ing a final decision, transit systems should make every effort to distinguish those co sts that are fixed and those that are variable. Finally, it is important to recognize that APTS technologies are evolving substantially over a short period of time. This constant state of change has significant cost implicat ions For example, economies of sca le, market penetration, and i ncrease d competition will contrib ute to downward pressure on costs. In addition, new features and products will continue to be deve l oped which will also impac t costs and benefits over time. A summary of the to tal costs collected for each of the APTS technologies is J)rovided in Table 1. A more detailed breakdown of these costs is provided in the complete report. 2Edward K. Motlok, Eric C. Bruun, and Kimberly J. Battle Bla ckmon, "Advanced Vehicle Monitoring and Communication Systems for Bus Transit: Benefits and Economic Feasibility, Executive Summary" (September 1991), p. 37. 4

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Table 1 Summary of Technology Costs Technology Location Cost Per Bus Total Cost Automatic Vehide Location Tampa $8.300 (Signpost TecMotogy) $1,574.990 Au1omalie Vehicle Location Kansas C i ty $ 7.640 (Signpost Technology) $2,172 .2 50 Automatic Vehicle Location Battlmote $33,720 (Global Position ing System) $ 7 925.765 Au1omatic Vehicle Location Denver (Global Positioning System) $16.670 $10.003.995 Advanced Communications San Diego $8.030 System $2, 634,750 Advanced Fare Payment Chattanooga $7 .350 $88. 1 5 0 (Smart Card) Computerized Dispatching Winston .. satem $49.120 $147.360 Annunciator Baltimore $17,760 $444,000 Communi(ation and Toronto $18, 70 0 lnf0fn1ation System $37. 400 .000 Communication and Dallas $21.100 $17.800.000 I n formation System APTS Benefits A significant p ort ion of the APTS literature is devo ted to the identificat i on and d i scussion of anticipated benefits associated with the imp lementat ion of APTS technologies. ranging from direct benefits like reduced costs and in creased ridership to extemal benefits such as reduce d congestion and emissions. However, very litt l e empir i cal evidence exists documenting the many benefits that are being claimed i n the industry and l iterature. Despite the lack of empirical support i t i s importan t to have a comp lete understand ing of the anticipated benefits. Potentia l agency and passenger benefits o f each of the seven technologies were identified and briefly dis c ussed i n this report. A summary of these benefits i s p r o vided in Table 2. 5

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Table 2 Summary of Agency and Passenger Benefits Automatic Vehicle Location (AVL) 1 I ncreased Efficiency/Reduced Cosls 2 Improved Data Colledlon 3. Improved Qualily of Service 4 Increased Ridership/Revenues 5 Enhanced Imag e of Transit System 6. Increased Security Automatic Passenger Counters (APCs) 1. Increased Accuracy of Passenger Counting Function 2. Reduced Labor Requiteme nts 3. lmptov ed Route Planning and ScheduJing Advanced Fare Payment Media 1. Increased Convenience for Passenger and Drive r 2. Improved Database of Fare Information Computerized Telephone Information Systems 1. Improved Qualil)l of Customer Service 2 More Efficient Customer Service 3. Increased Rkfership/Revenue Compu1erized Dispatching/Scheduling 1 Improved Quality of Serviee 2, Incr eased Efficiency 3. Increased F&e)(ibility 4 l ncteased Rtdership/Revenue Passenger lnfonnation Displays (PIOs) 1. Enhanced Customer Information 2 Increased RidetshipiRevenue Annunciators {Talking Bus) 1. Enh.anced Service to Passenger& 2. Enhanced Compliance with ADA Requirements 3. Inc reased Safety 6

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ALTERNATIVE INVESTMENTS ANALYSIS The alternative investments analysis assumes that the cost of the proposed APTS investment is available for use at the full discretion of the transit system. The question is then asked, 'What alternative investments could be made with this funding, and what impacts would these alternative investments have on ridership and revenues of the transit system?" These questions are analyzed for three of the more traditional transit investment alternatives including: an increase in revenue miles of service a reduction in passenger fare increase in trad itiona l marketing The purpose of the analysis is to quantify the impacts of alternative investments on ridership and revenue. In this exercise, a transit system is assumed to be contemplating a $1 million investment in APTS. This funding also is assumed to be completely flexible in that it could be used for any purpose at the discretion of the transit system. The impact of the first two investments is estimated through the use of demand elasticities. In contrast, the third investment alternative is analyzed from a qualitative perspective through discussion and literature review. Service and Fare Elasticities Service and fare elasticities are commonly developed and used to estimate the impact of changes in levels of service and fares on transit ridership. As a result, it is relatively simple to consider the potential impact of an alternative investment designed to increase revenue miles of service or to reduce the passenger fare. An elasticity of demand refers to the percent change in a dependent variable resulting from the percent change in an independent variable. For example, a service elasticity of demand of 0.47 indicates that a 1 percent increase in revenue miles of service is expected to result in a 0.47 percent increase in ridership. The examples provided in this section assume a service elasticity of demand as provided in "Patronage Impacts of Changes in Fares and Services," a report prepared by Ecosometrics in 1980. This document is recognized as the most comprehensive study of the effects of changes in fares and services on public transportation patronage' A more recent reference from an APTA publication is used for the assumed fare of demand It should be noted that can vary substantially from system to system. Therefore the Inc., "Patronage tmpacts of Changes in Transit Fares and Services" (U.S. Department of Transportation. 1980). 'American Public Transn Association, Effects of Fa"' Changes on Bus Ridership (May 1991). 7

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ideal situation would be to use elasticities that were estimated specifically for the transit system conducting the analysis These estimates would be more like ly to take into account the site specific characteristics of the tran sit service area. However, in the absence of system-specific information. generally-accepted service and fare elasticities are provided in these reports. Summary of Results The results of the comparison indicate that, for a representative t ransit agency a proposed $1 million investmen t annualized over six years could be used to: increase revenue miles of service, resulting in 48, 840 new revenue miles and 93 708 new passenger trips. This assumes that the $60,959 inc rease in passenger fare revenues Is invested in service expansion throughout the six year t ime period; reduce fares resulting in a reduction in the average fare of nearly $0.02, 129,003 new passenger trips, and a $125,877 decline in passenger fare revenues; expand marketing activities, the result of which is uncertain given that the literature is limited on the impacts of marketing on ridership ; impleme nt an APTS technology that would require a at least a 0.67 percent increase in ridership to achieve the same result as service expans i on o r a 0.92 pe rcent increase in ridership t o match the impact of reducing the average fare. Although limi ted, some evidence was presented indicating that APTS investments could result potentially in r idership and revenue impacts similar to those resulting from expanded service and a reduced average fare. The feasibility of APTS investments is further supported since the analysis in this chapte r focused only on the potential for increased ridership. The potential for achieving numerous other benefits of the many APTS technologies contributes to the feas ibility of many of the APTS investments. Although the impacts of APTS investments will undoubtedly vary by loca t ion and the type or combination of APTS technologies implemented, t his analysis provides preliminary information that will enable transit to put the prospect of APTS investments into some perspective relative to more traditional t ransit investments. 8

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BREAKEVEN ANALYSIS A breakeven analysis model developed by Morlok, Bruun and Blackmon was presented to aS$ist in determining the productivity improvements necessary to breakeven on an AVM/C i nvestment. The model was updated using 1992 national transit statist ics and extended to consider some of the external benefits that could potentially result f rom the implementation of an AVM/C system. The analysis is based on two ma jor hypotheses: (1) AVMIC systems have great potential for improving the productivity of bus transit by e i ther decreasing operating costs, i ncreasing revenues or some comb i nation of both, depending upon the priorities of the particular transit system, and (2) A VM/C systems have the potential to recoup the investment from cost savings. Using a representative transit system from the U S . two breakeven analyses were conducted The first estimated the tradeoff between a reduction in fleet size and revenue mi l es of service. while lhe second estimated the tradeoff between a reduction in revenue miles of service and an i ncrease i n fare revenues Table 3 summarizes these results. Table 3 Breakeven Analysis. Summary of Results Tradeoff Between Reduction in Fleet Size and Revenue Miles (necessary to break even on investment) Reduction i n Fleet Size -3.09 or 3 bu s e s (-2.30% ) Redudion in Revenue M iles -42,489 revenue m i les (-0.93% ) Tradeoff Between Reduction in Revenue Miles and Increase in Revenue (necessary to break even on investment) Reduction in Revenue Miles -42 .489 revenue miles ( 0.93%) Increase in Revenue $20 9 ,796 i n f are r evenue (2 30% ) Increase in Ridership 322,763 passenger trips (2.30%) If a reduction in revenue miles of service is achieved as a result of t he AVM/C system, numerous external benefits could be realized. i ncluding reduced trave l time. increased safety and reduced emi ssions. A summary of external benefits i s prov i ded i n Tab l e 4. It should be recogn i zed that the estimated external benefits are extremely conservative in nature since they are estimated solely on the basis of the reduced revenue miles of service and the resulting reduced exposure on the street network. Therefore. these estimates do not consider the potential for additional externa l benefrts that may result from more efficient provis i on of service. i.e., reduced emissions resulting from smoother travel speeds. 9

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Table 4 Summary of External Benefits 4 IN REVENUE MILES -42,489 Reduced Travel Time Revenue Hour/Revenue Ratio O.o784 l1. in Revenue Hours .331 Value of Vehicle Travel Time lor Transit Buses $72.79 I! Vehicle Travel Time Costs $242,495 Increased Safety Collisions per Million Bus Revenue Miles6 23.06 l1. in Incidents Du e to Reduced Ex.posure .98 1 Estimated Cost per lncident7 $44 222 tJ. in Accident Costs -$44,222 Reduced Emissions Average Bus Speed (mph)' 12.75 Hydrocarbons (grams per mile)9 6.29 Carbon Monoxide (grams pe r mile)9 49. 1 5 Oxides of Nitrogen (grams per mile)* 12.42 I! in Non-Methane Hydrocarbons (grams per mile} 7 ,259 I! in Carbon Monoxide (grams per mile) 2.088,357 tJ. in Oxides of Nitrogen (grams per mile) ,719 'uSDOT. FTA, CharacteriSiics of Urban Transportation Systems. Table 411, Value of Vehicle Travel T ime by Vehicle Class {1990 Dollars Per Vehicle Hour} ; NOTE: Costs for tra\!el include labor wages and fringes. vehicSe costs. and inventory costs. For trave l the value of time was assumed to be 60 percent of the wage rate for drivers and 45 percent of the wage rate for passeng e rs OU.S. Department of Transportation, Federal Transit Administration, Nationa l Transit Summade s and Trends From the 1992 National Tr.ansit Database (May 1 994) p. 74. 7USDOT. FTA. Characteristics of Ulban Transportation Syst ems Table Costs o f Pol ice-Rep orted Crashes by Highway Functional Class (1990 dollars); Assumes an average ollhe low ( loca l road) and h igh (other freeway) cost per crash; Cost incl udes medical services. ancillary services, eme rg ency services. lost wages, lost household production, losl qual ity of life. workplace disruption, insurance admin i st ra tion, legal an d court travel delay for un involved motorists, and p roperty damage. &Average bus speed computed by dividing revenue miJes by reven ue hou r s for the reptesenlative transit system of the U.S 91bid., Table 4 Illustrative Emission factors by Speed and C-alendar year (grams per miles): Use s MOBILE 4.1 emission factors for heavy duty vehicles in calendar year 1995; NOTE: based on the computed average bus speed of 12 75 mites per hour. 10

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I. INTRODUCTION Advanced Public Transportation Systems (APTS) are advanced navigation and commu nication technologies applied t o all aspects of public t ransportation. The purpose of these advanced techno l ogies is to increase the t imeliness and availab ility of passenger information and to imp rove the convenience reliability, and safety of transit service The Federal Transit Administration (FTA) established the APTS Program as part of the U S Department of Transportation s i nitiative in Intelligent Vehicle Highway Systems (IVHS) recently renamed Intellig en t Transportation Systems (IT S) to ass i st in the development and eva l uation of advanced technologies I n the transit industry. ITS originated as a mechanism f or enhancing transportation mobility, energy efficiency, env ironmental protection, and safety for automobile drivers. The APTS program was develope d in an effort to provide an equal focus on public transportation. FTA's primary objective Is to increase the industry's knowledge of successful applications of advanced technolog ies through operational tests eva lua t ion s, and the d i ssemination of It is hoped th at these efforts will le ad to widespread adoption of these techno logies "The impro ved public transportation services that will result should attract more ri ders to and ridesharin g modes. thus producing the added public benefits of reductions in traffic congestion, air pollution, and energy consumption."'0 Based on this statement, it is clear that APTS w ill continue to receive support at the federa l level in th e foreseeable future. Su pport exists for APTS Institutionally through the FTA, ITS America, and the transit industry in genera l. This has contributed to the fact that a majority of the literatur e and newspaper media in this subject area focuses on discus sio ns of the potenti a l benefits associated with the imp le mentation o f APTS techno l ogies. However few efforts have been made to quantify benefits empirically and then t o assess the of these benefits relative to the costs of implem enting operating and mai nta i ning these technologies. In response to this shortcoming, "'Carol P Schweiger, Mary Kihl. and Lawrence N Labell, Advancod Public Transportation Systems: Tlla State An Update '94 (U.S Department of Transportation, Federal Transit Administration, January 1994), p. 1. For example: 1ntelli9enl S ystems Could Attrac:l New R iders. Transit Leade r & Say : Transport (August 1 11190); "tinton: lnteligent Systems Ctitical." Passenger Ttanspotl (Augus t 1. 1994); "APTS Technology Can Benefit TntnSit Rldetship," Passenger (July 11, 1994), p 1 8 ; Ve
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this document offers some preliminary evaluation techniques for assessing the feasibility of APTS investments at the tra nsit system level. OBJECTIVE OF REPOR T The objective of t his report is to provide an assessment of APTS by introducing several evaluation methods that assist in pulling these advanced technologies into perspective. Eva luation methods are identified that can be used to ass ist in determining the preliminary feasib ility of APTS Investments without the findings of completed operat ional tests. From a strict economic perspect ive a comprehensive benefit/cost analysis (BCA) should be conducted to assess the feasibility of a series of investment alternatives, including APTS and more traditional transit investments. However, since empirical data on the costs and benefrts of various APTS investments are limited and the magnitude of these benefits could vary significantly by location, a comprehensive BCA may not be feasible for most transit systems due to resource and data limitations. For this reason three alternative evaluation options are offered i n this report to assist in the preliminary assessment of APTS investments. This will, in tum, provide some additional guidance for the APTS d ecisionmaking process at transit systems throughout the United States. OVERVIEW OF REPORT The remaining structure of the report is summarized below. Chapter II summarizes the technologies included within the frameworl< of APTS. The technologies selected for analysis in this report are identified and described. Chapter Ill provides an assessment of APTS evaluation The assessment includes a review of the evaluation framework developed by the Volpe Center for the evaluation of operational tests and i ntroduces three evaluation techniques for determin ing the preliminary feasibility of implementing an APTS technology Chapter IV provides a general assessment of APTS investments. The general assessment inc ludes the development of a clear understanding of costs and a qua litative description of benefits. The capital costs of implementing selected APTS technologies are provided in this report. In addition, benefits res ulting from advanced technologies that are ci ted in the literature or reported by transit systems are summarized and discussed 12

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Chapter V presents an Alterna t ive Investments Ana l ysis This process analyzes potential APTS investments in the context of what alternative and more tradi t io n a l transit investments cou l d be made with the same level of funding and what impacts these alternative investments would have in comparison to APTS investments Examp l es of more traditional transit i nvestments include expansion of service increase in the level of fare subsidy or i ncreases in traditional marketing activities Chapter VI extends an evaluation framework develo p ed by Morlok in which a convent i onal cost mode l i s used to estimate the fleet reduction or service r eduction necessary to break even o n an investment in an Advance Vehicle Mo ni toring and Communication technology (AVM/C) AVM/C is an automatic vehicle location system combined with an advanced communications system In addition to updating the model with 1992 national statistics, the ana l ysis i s extended to include the externa l benefits of reducing vehicle m i les of serv i ce, including reduced travel time i ncreased safety, and reduced emissions Appendix A provides the agency name, contact name and phone number for agencies that contributed infonnat i on and/or data to the project while Appendix B presents a l ist of vendors who offer equipment and/or services re l ated to the seven technologies selected for analysis in thi s report 02Morlok et al. 13

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II. APTS TECHNOLOGIES OVERVIEW The range of APTS technologies can be placed into three major categories inc lud ing Smart Traveler Technology, Smart lntermodal Systems and Smart Vehicle Technology. Each of these categories is summarized briefly below and a list of specific examples is provided for each technology classification." Smart Traveler Technology Individuals who have access to accurate real-time Information in making travel decisions involving high-occupancy vehicles and public transit are considered "smart travelers." The technologies within this category emphasize the demand side of the transportation supply and demand relationships in that they are directed at increasing and enhancing the availability of information and making the use of public transportation more convenient for public transportation users.1 Examples of this type of technology include the following: Advanced/Integrated Fare Payment Media Passenger Information Displays (Smart Kiosks) RealTime Rides hare Matching Multimodal Trip Reservation and Integrated Billing Systems Annunciators (Talking Bus) Smart lntermodal Systems Smart lntermodal Systems strive for coordination and integration of transportation services offered by multiple providers. These providers represent a variety of modes and funding sources. Integration is accomplished through electronic technologies that simplify financial and other kinds of transact ions more detai1 on APTS t&etlnology in general, see Schweiger. et al. "Ibid., p. 3. 14

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Some examples of Smart lntennodal Systems include the following: Computerized Telephone lnfonnation Systems Multimodal Smart Cards/Payment Systems High-Occupancy Vehicle Facility Monitoring Transportation Management Centers Vehicle Guidance Systems Smart Vehicle Technology This technology includes vehicle-based technologies designed to achieve more effective vehicle and fleet planning scheduling, and operations. In an effort to improve efficiency and effectiveness of service provided, Smart Vehicle Technology focuses on the vehicle." Examples of Smart Veh i cle Technology include: Advanced Communications Systems Automatic Vehicle Location Systems Transit Operations Software Computerized Dispatching/Schedu l ing Systems Automatic Passenger Counters Selection of Technologies for Analysis Seven advanced techno l ogies were chosen for more detailed analysis in this report. Technologies in i tially were selected based on transit industry interest as measured by applications in the l iterature, case studies and presentations at national conferences and the anticipated availability of i nformat i on on costs and benefits of technologies The selected technologies are summarized below. 1. Automatic Vehicle Location (AVL) AVL provides conlinuous tracking of veh i cles through devices as simple as an on-board transponder communicating with a roadside signpost lo sophisticated Global Positioning Systems (GPS) licensed for tracking by the U.S Department of Defense. AVL usually i s linked loa radio system enhancing driver d i spatcher communication. Real-time vehic l e location through AVL can provide the potentia l for improving on-t ime perfonnance by generating trend data to belter plan schedules and roules. 'Ibid., p. 45 15

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2. Automatic Passenger Counters (APCs) APCs automate the passenger counting function. The technology enables the collection of boardings and alightings at each stop along with the time and date associated with each alighting and boarding. APCs can provide the benefits of more efficient use of vehicular and personnel resources and increased operational productivity thrcugh accurate ridership counts. 3. Advanced Fare Payment Media Advanced Fare Payment eliminates the time and effort required for fare payment during a trans i t trip by automating the transaction The automated payment function can take the form of debit cards or "smart" cards. Debit cards are magnetic stripe cards (e. g credit cards) and are constructed of either paper or plastic. This type of card already is used by a number of transit agencies today. Smart cards, also the size of credit cards can be contact (inserted into a reader) or contactless (wireless transmission). The smart card technology for advanced fare payment media also allows for variable fare structures. The primary objective is to eliminate or r educe the on-vehicle delay caused by fare payment. 4. Computerized Telephone Information Systems -The primary object i ve of advanced telephone information systems is to better inform transit users about transit service, i.e., routes, schedules, etc. Potential transit users can call the network control center and describe where they are and where they want to go. Based on this request a human operator or voice-synthesized operator can respond quickly to determ i ne the best route for callers to take and can prcv i de additional i nformat i on, such as necessary transfers the nearest stop, and the next scheduled bus Automation of transit informat i on provided over the telephone allows more calls to be answered by fewer operators in muHiple languages 5. Computerized Dispatching/Scheduling Th i s is an extension of Computerized Telephone Information Systems and AVL, enabling a passenger to call {voice or touch tone) for transportation to a desired destination. The computer selects the bus that best serves the transit patron. Buses may dev i ate from established fixed routes or may be summoned directly on demand. Reservations also can be made by users of the system This concept was successful in the United States in the 1970s {with small fleets) when dispatching was manual, and now is working extremely well in Germany, where the system is referred to as FOCCS (pronounced "fox")18 An operational test of a similar system is being conducted in Portland. Oregon. This technology offers the potential to serve sprawl ing deve l opment with fewer, and perhaps smaller, vehicles. I nformation also can be provided in multiple l anguages ,.Robert w. Behnke. Getman smart-Bus Systems: Poten#al for Applica#on i n Portland. Oregon (Volumes 1 and 2) (U.S. Department of Transportation Federal Transit Administration January 1993) 16

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6. Passenger Information Displays (PIDs) The type of i nform a tion available t o the user varies by the system Computerized telephone i nformation and d i spatching systems can commun i cate real-time on-demand i nformation requests directly to the trans i t user through PIDs or kiosks D i splays can be pass ive-showi ng different schedu les. areas, routes, etc .-or interactive-showing users exactly what i nform a ti on they want to see. A passenger infor mation display can enable passengers to plan their routes by origin a nd destination points. PIDs are most effective at transfer locations, major public facilities (regional shopping malls, civic centers, stadiums, hotel complexes, etc.), and arriv al points (airports bus stations, etc.). For exa mple, if installed at mode transfer stations, passengers can determine wh en the next bus w ill arrive at the stop From this determination, the passenger can wait for the bus, change modes, or spend lime more efficiently while waiting. Information also can be provided in multiple languages 7. Annunciators (Talking Bus) Annunciators also known as Ta l king Bus," provide a recorded voice to announce stops on th e route In addition t o provid i ng a new serv i ce to trans i t patrons annunciators can hel p meet compliance requ i rements of the Americans with D i sabi lities Act As with co m puterized tel ephone i nformation systems and P I Ds I nformation a lso can be provided i n multi ple languages. 17

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Ill. APTS EVALUAT I ON Evaluation methods and techniques for assessing the feasibility of APTS investments are identified in this chapter. Based on the characteristics of the proposed investment and the availability of data for analysis, various analyses are recommended to assist in the decisionmaking process MOTIVATIONS Prior to presenting the evaluation processes, it is useful to develop a more t horough understanding of the motivations for investing in APTS technologies Different motivations can reflect different priorities, which in turn may necessitate different evaluation approaches. From a purely cost-effective management perspective, typical motivations that one might expect to see inc lude the following: to increase ridership to increase quality of service to reduce operating costs to enhance the image of the transit system However, in many instances where advanced technologies are Involved, motivations may not be based on this perspective Othe r motivations may inc lude : to keep up with other transit systems that are implemen t ing the techno lo gies to take advantage of grant money that is ava il able for technology demonstrations to satisfy political desires and ambitions When these aHemative motivations ex i st, t he investment decision may have already been made prior to any objective evaluat i on. Even i n such situations, the analyst should make every effort to determine whether the proposed investment is cost-effect i ve The evaluation process presented in the remainder of this chapter is intended to address the first set of motivat i ons identified. Four major steps are identified as part of the economic evaluation of an APTS technology. The process inclu des evaluation components only ; other e le ments of the dec i sion making process, such as funding and administ r ative considerations, are not included in this discussion. The four steps are summarized below. 18

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Step 1: Define Proposed APTS Investment Developing a thorough understanding of t he proposed APTS investment is the first step in in itiat ing a comprehensive evaluation. In many instances, different leve ls of investment will be identified based on different technologies that serve the same purpose and various options that can be added to the base investment. For example, the use of different technologies in the implementat ion of an AVL system can have a significant impact on the evaluation, particularly as it relates to the identification of costs. In addition, a transit system contemplating an investment in an AVL system also may want to consider a simultaneous investment in an advanced communications system, an automatic passenger counter system, or some other APTS technology. It may be appropriate to i dentify severa l alternative investment levels that recognize different technology investments and other additional options that could be added to the base APTS investment. By doing so several alternatives can then be evaluated simultaneously. Step 2: Conduct General Assessment Once the transit system has clearly defined the technology under consideration a general assessment of costs and benefits should be conducted The general assessment includes the preparation of a comprehensive list of costs and benefits for the base investment as well as any incremental costs or benefits that result from additional options identified. Secondary sources should be used to define and to the extent possible, quantify the costs and benefrts of the proposed APTS investment in as much detail as possible. Step 3: Conduct Preliminary Evaluation The purpose of preliminary evaluation is to assist in determining the feasib ili ty of a proposed APTS in vestment. In addition to the general assessmen t conducted in Step 2, the primary focus of thi s report is to present and discuss two preliminary evaluation techniques. These techniques include an Alternative I nvestments Analysis and a Breakeven Analysis. The results of the preliminary evaluation will assist in the decisionmaking pro cess of whether to continue to pursue an APTS investment. Step 4: Develop Evaluation Framework If the APTS investment is proposed to be a demonstration project through the Federal Transit Administration's ITS Operational Test grant program, the transit system must complete the formal grant application and submit it for funding. If the grant application is ap proved the transit system must conduct an operational test evaluation of the demonstration project as provided in guidelines developed by the Volpe Center. Even if funding for the APTS investment is received from a different source, it is recommended that the transit system use t he Volpe guidelines in 1g

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developing an evaluation framewo rk for the proposed APTS technology. The Volpe guidelines are summarized briefly in the following paragraphs. OPERATIONAL TEST EVALUATION (Volpe Center) Efforts have been made to demonstrate the array of APTS technologies in the form of operational tests being conducted throughout the United States. Sponsored by FTA. operational tests serve as the transition between research and development and full scale deployment of ITS technologies. These demonstration projects enable transit systems to evaluate how well advanced technologies perform under real operating conditions and assess the impacts and public support of the demonstrated technology 17 Operational tests are intended to provide more than just a demonstration of the technology. The deployment of these technologies are to be evaluated to help support: further development of APTS systems public policy affecting these systems marketing strategies by vendors the decis i on to make long-term investments in these systems Since funding has been made available for these operational tests, evaluation methods have focused primarily on the assessment of these technology demonstrations. However, since few operational tests have been comp leted, the amount of informa t ion and leve l of deta il that will result from these evaluations is uncertain. The Volpe National Transportation Systems Center has developed guidelines for planning, implementing, and reporting the results of APTS operational test evaluations. The primary objective in developing these gu i del ines is to encourage and support consistent evaluation methodology and to enhance the comparability and transferability of operational test results. The document, "Evaluation Guidelines for the Advanced Public Transportation Systems Operational Tests," provides an evaluation structure which should be customized for each operational test. Conceptually, the evaluation process can be thought of as the link between the operational test and technology transfer portions of the APT$ Program. '8 11Center for Urban TransportaOOn Researcfl, "Economic and Po licy Considerations of IVHS Transi t AppiK:ations. Technical Memorandum #1: Background and Review of Evaluation A,pproaches" (Oe<:ember 1993) p. 11. 3U.S. Department of Transportation. Federal Transit Administration. "Evaluation Guidelines for the Advanced Public Transporta tion Systems Operational Tests," Drofl (nd), p. 7 20

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As summarized below, the evaluat io n framework is composed of four major phases: eva luabon frame of reference, evaluation planning, eva luat i on implementat i on, and potential evaluation spin otis Phase 1: Evaluation Frame of Reference -The evaluation frame of reference establishes the op erational test applicat i on, APTS Program objectives, external influences and local issues, objectives, and site characteristics. Phase 2 : Evaluation Planning In the evaluation planning phase, the contractor works with the FTA, the Volpe Center, and var i ous local agencies to develop an eva l uat i on strategy. Developing the evaluation strategy involves the following task s : the determinat ion of measures of effectiveness (MOEs) and collection of de rivation techniques re qu ired to assess APTS financial impacts and functiona l characteristics, user acceptance, effectiveness, efficiency, and other im pacts planning decisions relative to data collection/analysis, including bas i c data collection/analysis design, criteria stratification sampling requirements, and timing of data collection determination of site data requirements and sources Once the strategy i s completed, a detai l ed evaluation plan can then be formulated. Phase 3: Evaluation Implementation -The imp l ementation phase is the period during which the evaluation p lan is executed and includes the following tasks : recording of project implementation/operational history collection/analysis of quantitative/qualitative measures conducting other analyses of information relevant to project issues collection/analysis of site specific data recording of external events preparing final summary evaluation report Phase 4: Evaluation Spin-offs In anticipation that operational tests likely will resuH in potential implementation and analytical spin-offs, the eva lu ation framework includes this phase to encourage contractors to contribute by sharing the broader l essons learned from a given operational test. Potential spin otis might include : comparison of project results with t h o se of other APTS projects application of project findings to innovations in other s ite s post-operational test project modifications at test site 21

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use of project database in simulation models improvements in evaluation process, frame of reference, and plan For more specific informat ion on the APTS evaluation guidelines, refer to the Volpe Ce nter report "Evaluation Guidelines for the Advanced Public Transportation Systems Operational Tests." PRELIMINARY EVALUATION TECHNIQUES The general assessment as well as the three preliminary evaluation techniques are described below General Assessment In the general assessment technique, a detailed brea kdow n of costs for the propos ed investment must be prepared. This is followed by the development of a comprehensive list and qualitative analysis of the potential benefits of the proposed investment. Oecisionmakers must then weigh the costs and benefits in order to make a decision regarding full implemen tat ion of a proposed APTS investment. Chapter IV provides a discuss ion of costs and benefits for the seven selected APTS technologies. Alternative Investments Analysis The purpose of the alternative investments analysis is to analyze the potential impacts of using proposed APTS funding for more trad itiona l transit investments such as an increase in the level of service, a reduction in the average fare, or an expansion of traditional marketing activities. The impacts of the first two alternative investmen t s can be estimated in terms of increased ridership and revenues based on serv i ce and fare elasticities of demand, which are commonly used in the transit in dustry The i mpacts of investi ng in the expansion of t raditional marketing activities is also discussed. This analysis teChnique is presented in Chapter V Breakeven Analysis A breakeven analysis is presented based on work conducted by Morlok, et al., in 1991." The analysis assumes that the primary benefrt of an APTS investment is a reduction in fleet size or in revenue miles of service. The focus of the analysis is lar gely fo r evaluating APTS investments related to AVL. Based on this premise, a widely-accepted tran sit cost model is used to determine the reduced number of buses and/or revenue miles necessary to breakeven on the ''Morlok et al., pp. 28-59. 22

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APTS i n v estment. The ana l yst then must use judgement to predict whethe r the required reduction i s possible. The ana l ysis i s extended to quantify some o f the external benefi t s re s ulting f r o m a reduction i n revenue miles, inc l uding reduced travel time, i ncreased sa f ety and red u ced emi ssions. A discuss ion of the B r ea k even Analys i s is prov i ded i n Chapter VI. 23

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IV. GENERAL ASSESSMENT A general assessment of the selected APTS technologies is provided in this chapter and includes a compilation of costs and potential benefits associated with the seven technologies selected for invest i gation in th i s report. In addition to a comprehens i ve review of the literature transit systems throughout the States and in Toronto were contacted to solicit the latest in cost information for the technologies analyzed in this report. In addition potential benefits were c o mpi l ed for each technology as reported in the literature and through interviews with transit industry professionals who have had experience with APTS. A list of the contributing agencies is prov i ded in Appendix A, and a list of vendors that are known to provide equipment and services related to the selected technologies is provided in Appendix B Transit systems that are contemplating APTS investmen t s always should begin their decision making process b y conduct i ng a general assessment. I t is extremely important that the system develop a clear understanding of the detai l ed cos t s and pot ential benefits assoc i ated with a p roposed investment. Although the infonnation provided in this chapter does not provide the detail necessary to conduct a complete general assessment for a spec i fic transit agency it does provide the starting point for fully understanding the nature of costs and benefits associated with many APTS investments. From this start transit systems can build upon the assessment and customize the analysis to meet the specific needs of the agency While the general assessment of APTS costs was being conducted, i t was discovered that the public of techno l ogy costs is extremely limited This is due to the proprietary nature of the costs in general (i.e., pending transit agency bids), and the fact that, i n some cases, bids have not yet b een fonnally requested for each o f the technol o gies previously identified As a result, the t echnology costs presented in this chapter are limi ted to those that have been obtained as a result of available b i d tab summaries o r t hrough anecdota l infonnation collected t h r ough interviews with trans i t industry profess i onals. B i d infonnation is presented i n as much detail as poss i ble in table format, wh i le anecdotal i nfonnation is included in an attempt to enhance the understanding of technology costs from a more genera l perspective. Because of the limited availability of detailed costs for the selected APTS technologies. it is i mportant that this infonnation be used w i th caution. Th i s informat ion is not i ntended to be universa ll y applied to trans i t systems throughout the U.S. The p resentation of this cost infonn a tion is designed to provide trans i t agencies with some sense of the magnitude of investment requi r ed to i mplement APTS technologies 24

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TECHNOLOGY DISCUSSION Prior to the review of t echno logy costs, it is appropriate to provide additional detail concerning the technical characteristics of the APTS technolog ies. A brief technical descript i on is provided below for each of the seven AP T S technology i nvestments selected for evaluation in this report. Automatic Vehicle Loca tion (AVL) Systems AVL prov ides the backbone for most APTS systems. As a result, mor e information is available on AVL than any other APTS technology. AVL provides a means of continuously tracking the location of vehicles and is frequently combined with a voice communication system, allowing drivers to communicate with the dispatcher over a radio frequen cy Some trans it agencies have purchased an AVL system and an advanced communications systems simultaneously while other systems have purchased an AVL system to augment a commun i cation system that is already in place. Numerous technologies exist for the implementation of an AVL system. Regardless of the technology the fundamental princ ip le to these systems i s to establish an grid that covers the service area in question and then use some method of "mapping" the l ocation of vehicles to the grid. Six positioning techno l ogies have the capability of carrying out the fundamental principle of establishing the grid and then locating the position of vehic les on the grid. These technologies are described below Dead-Reckoning -Dead-reckoning combined with map-matching (see below) is the most low -tech form of technol ogy Dead-reckoning uses a compass and odometer to determine how far and in what direction a vehicle has t raveled from a known point. Unfortunately, the accuracy of dead-reckoning systems diminishes quickly distance approaching unacceptable levels within a few dozen m i les. Therefore, when this positioning technology is used, it is usually used in conjunct ion with other position ing technologies. Map-Matching Map-matching uses a compass and map database to correc t errors in other positioning systems. The system is based on the assumpt i on that if a vehicle is tuming, i t must be tuming onto one road from another. The map-matching system compares the current estimate of the vehic le s position to the closest t urn in the road and adjusts the vehicle's position accordingly Signposts being considered a low-technology application signposts have proven to be a reliable pos it ioning technology for many transit agencies When used in a transit applicat i on, roadside antennae are installed o n signposts along transit routes (i e. traffic 25

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signal poles, light poles, etc .) When a transit vehicle equipped with a transponder passes a signpost, the antenna records the information stored on the transponder as well as the time and d irection of movement One drawback to the use of signposts is tha t, if a bus route changes, many antennae likely will need to be removed and repos itioned along the new routes. 20 Signpost-based A VL is particularly useful for the automatic location of vehicles in systems where the routes seldom change, such as railcars. The signpost system is a closely related but far s impler version of a Multi-Lateration System, which is discussed next The difference is that, in the signpost system, the "grid" is simplified to be a r oad and the transmitter has an extremely low range This means that a single "circle" o r range can be used to find the loca tion of a vehicle. In addition, the signpost requires far less precision but more transmitters due to the lower range21 Multi-Lateration Systems There are two forms of multi-lateration technologies, inc luding tri-lateration systems and tri-angulation sys tems. Tri-lateration works by calculating the position of a vehicle by comparing the distance of the vehicle to the position of at least three different radio tower signa l s The positions of these radio towers are mapped to a grid as reference points. The radio towers estimate the distance of the vehicle by analyzing the time it takes a radio signal to travel from the radio tower to a transponder on the vehicle and reflect back t o the tower. If only one transmitter receives the refle cted signal then the system maps a circle onto the grid, with each point rep resenting a possible location of the vehicle. But if three or more tra nsmitters receive a reflected signal t hen the system can superimpose those three circles onto the grid, plot the intersection of those three circles and obtain a unique lo cation. The distance between transmitters can be as far as 10 miles or more. Depending on the local topography and number of radio frequency (RF) towers transmitting, positioning can be as accurate as +/50 feet Tri-angula tion systems operate using an entirely different method than other AVL systems. First, the antenna site is mapped onto the grid as with the previous two methods. Then, each antenna measures the angle or direction that a signal arrives As opposed to tri lateration, this method only requires two sites. After the loca t ion of an antenna site is plotted the bearing or direction of the signal can be measured with respect to two or more antennae. The more antennae that can acquire a bearing, the greater the accuracy of the 20Coley1Forrest, Inc., Cos\IBenefit Study'" (Denver, Colorado: Reglonal Transpotta1k>n Oi$1rict, June 1989), p. 9. 2 1David Cain, '"AVL Teehnoaogy Investigation and Applicability Reporr {Porttand. Oregon: Tri..County Metropolitan Transportalion O i slrict of Oregon, January 12. 1990). 26

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location 22 Although many commercial fleets have found radio signal tri angulation to be a cost-effective AVL technology, i t is feasible only where radio signa l towers already have been installed Vendors typically install towers only in metropolitan areas with sufficient size and population density to make the investment cost effective (e.g Los Angeles, Dallas. Houston, Detroit, Chicago, MiamilFt. Lauderdale) LORAN-e LORAN-e is a type of radio signal tri-angulat i on operated by the U.S. government and used primarily for ship and aircraft navigation LORANC is available in most areas of the continental Untied States. Other positioning technologies, such as commercial radio signal tri-angulation signpost and global positioning systems. appear to be replacing LORANC. This can likely be attributed to the cost of the vehicular receiver (approximately $2,200), as well as to problems with interference that can result from passing under high voltage transmission lines and viaducts Globa l Positioning Systems (GPSl A GPS reflects signals from an antenna installed on a veh i cle to one of a network of 24 satellites. This network was initially set up by the U.S Department of Defense, which now licenses half of its satellite time to commercial users. The satellite determines the vehic l e s position and relays thi s informat i on back to the fleet dispatcher GPS is the most high-tech of the posit i oning technologies available in AVL systems .23 The difference between tri-angulation and GPS is that, in the former method, the on-board (OBU) simp l y reflects or emits a si gnal, and the r e is no significant processing performed on the vehicle. In contrast, sign i ficant processing is performed by the on-vehicle unit with GPS In some cases. the satellites simply give a signal to the OBU which performs all the computat i on. The higher cost of the satellites and the intrinsically higher complexity of the OBU means that GPS systems generally will be more expensive than other methods.2 Automatic Passenger Counters (APCs) APCs count how many people board and a l ight a bus These counts also can be recorded by time of day The informat i on gathered from APCs is used for accurate ridership counts and future planning of schedules and routes. Vendors also are accustomed to leasing APC systems to transit agencies for the collection of data for the Section 15 reporting program required of 2)Schweiger el al. 27

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transit systems receiving federal funding. The APC system uses two adjacent and horizontal infrared light beams that span across the door steps of the transit vehicle. T he passenger counting process uses a four-step logical sequence to detect whether a passenger is boarding or alighting. Advanced Fare Payment Media The purpose of advanced media is to make fare payment eas ier and quicker. It allows for multiple trips to be paid for in advance, as well as for variable fare structures by time of day, day of week and fare discount programs, etc. Ease of fare payment is also an important consideration in meeting the compliance requirements of the Americans with Disabilities Act (ADA). There are several types of media that can be used for transit fare payment, including: Magnetic stripe cards Magnetic stripe cards can be made of paper or plastic and have a magnetic stripe that stores information related to fare payment. Cards are read and debited by be i ng either inserted and transported through a turnst i le or swiped through a reader The ca r ds can be disposable (paper) or permanently issued to passengers (p l astic) Magnetic stripe ca r ds are already in use at many transit systems in the U.S. (e.g., Washington Metro, San Francisco BART) and are not co n sidered an advanced technology Contact "smart" cards This fare card is the size of a conventional c r ed i t card and has a tiny microch ip built in that can perform processing functions upon contact. The cards are debited by inserting them into some type of reader Contactless "smart" cards -This card also contains a microchip and can perform complex processing functions. However, as the name suggests, it does not requ ire "contact" since it can use a variety of wireless transmission media, such as microwave radio frequency infrared, and aco u stic wave. These cards are read s imply by be ing in proximity to a reader antenna Computerized Telephone I nformation Systems In a transit telephone informat i on system passengers call into a central number that is answered by an operator The passenger informs the operator of the desired origin and destination and the operator then determines the optimal route the passenger should take. A variety of information can be provided including the route and bus(es) the passenge r should take, required transfers the transit stop nearest to the passenger's l ocation, next scheduled bus, etc 28

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This process can be improved by converting to a computerized tele phone informatio n system. Through voice or touch-tone activation, callers can indicate their transportation needs and the computer can respond quickly and accurately based on the information in the database. For example, to get schedule information (planned or real-time) on specific bus r outes the caller could enter route numbers on a touch tone phone. TeleRide Sage of California has designed a system that interprets spoken instructions over the phone. In cases where a human operator is still required, the computerized database can improve the information that is communicated to the caller. Computerized Dispatching/Scheduling Dial-A-Ride Transit (DRT) is a manual vehicle dispatch system developed in the United States during the 1960s and 1970s. T esting concluded that the system was feasible only for small fleets, up to 20 vehicles. However, recent technological advances have made the use of computerized dispatching feasible on a much larger scale. With these advances, passengers can i nput their origins and desired destinations in a number of ways, such as by keying in the informatio n at a kiosk or thro ugh a telephone or by communicating directly w ith a telephone operator. Passenger lnfonnatlon Displays (PIDs) Several different types of passenger information displays exist that can display a variety of informa tion for patrons. Displays can be passive (overhead 'TV monitors) or interactive ("smart" kiosks that enable passengers to plan their route by keying in their origin and destination). PIDs can display static informati on, such as when the next bus is scheduled to anive at a certain stop. In addition, when linked to an AVL system, realt ime bus arrival and departure information can be disp layed Annunciators Annunciators, also referred to as "Talking Buses," use a record ed voice to announce stops on a bus route without requiring any action from the driver. This technology also allows transrt to accommodate visually-impaired passengers, as required by t he Americans with Disabilit ies Act If int egrated with an AVL system a synthesized (computerized) voice can indicate r eal-t ime street/intersection locations through the communication of bus position in multiple la n guages. 29

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APTSCOSTS As ind icated previously, costs of selected APTS technolog ies were solicited from systems throughout the U.S. and Toronto as well as through literature review. A good representation of costs was obtained for AVL systems; however, limited cost informat ion was obta ined for advanced fare payment, computerized dispatching/scheduling, and annunciators. Cost infonnation for APC systems, computerized telephone infonnation systems, and PIDs is limited even further to anecdotal infor mation collected through review of available benefit-cost reports and discussions with professionals in the transit industry. Where possible, bid tab summaries were collected to provide as much detail as possible regarding the component costs of each technology investment. The presentation of cost infonna t ion focuses solely on the estimation of capital costs. Virtually no data were collected describing the cost of operating and maintaining these technologies. In a survey conducted by Morlok transit agencies with experience in AVL ind ica ted that operating and maintenance costs of this technology are relatively small and believed to be offset by related cost savings (e.g., lower administrative and data costs) .25 However, no references to the operating and maintenance costs associated with the implementation of the remaining APTS technologies were identified. As a resuH, discussion of these costs is excluded f rom the analysis and left for future research An additional consideration t hat is not reflected in the presenta tion of costs i nvolves the designation of fixed versus variable costs Most of the technology investments are likely to include significant fixed costs that would be required regardless of the size of the t ransit system In a portion of the investment also will include variable costs that w ill change with the number of buses th at the transit system operates The amount of fixed and variable costs as a percent of the to tal investment will vary significantly with the type of technology that is selected for implementation. For example, the fixed costs associated with an AVL system using GPS techno l ogy is expected to be much greater than those associated with a system using the signpost technology. Due to the lack of detailed cost infonnatlon fixed and variable costs have not been distinguished in t he presentation of costs. Despite the recognition of this shortcoming, the cost tables presented include a per bus cost in each example. Th is in no way means that all technology costs are variable. This is inc lude d to enable transi t systems t o develop a general sense of the magnitude of total investment required fo r a given APTS technology. Prior to making a final decision. transit systems should make every effort to distinguish those costs that are fiXed and those that are variable. "Morlok et at .. p. 37. 30

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Finally, it is important to recognize that APTS technologies are evolving substantially over a short period of time. This constant state of change has significant cost implications. For example, economies of scale, market penetration, and increased compe tition will contribute to downward pressure on costs. In addition, new features and products will continue to be developed which will also impact costs and benefits over time. The remainder of t his section presents cost information for each of the technologies. The technologies are presented according to the amount of detail that was available on the respective costs (most to least). Due to the inexac t nature of cost identification, the component costs summarized in the tables are rounded. Automatic Vehicle Location Four AVL bid proposals were obtained from transit agencies in Tampa, Kansas City, Baltimore, and D enver The Tampa and Kansas City transit agencies procured signpost-type AVL systems while Baltimore and Denver purchased GPS-based systems. In addition a bid summary was obtained for a "communication s center" at San Die go Transit Corporation. The primary components of a complete AVL system inclu de: (1) a method of position determination (2) a means of communication with the dispatcher in rea l-t ime (3) a centralized p roce sso r capable of storing and using transmitted location information (4) miscellaneous components, such as software and t r a ining The costs for the four AVL systems are presented in Tab les 5 through 8 while the communications system costs for San Diego are provided i n Table 9. 31

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Tamps -The transit system in Tampa impl emen ted an AVL system using the signpost technology and is currently in use for 190 transit vehicles The cost information compiled for the Tampa AVL system resulted from an extremely competitive bidding process which resulted in what is believed to be an extremely low cost for the communications system that was procured along with the AVL system. Maintenance costs were included with each line item cost. However the $8,300 AVL cost per bus is in line with expected AVL cost range of $6,300-$8,500 per bus .26 An AVL system cost summary for Tampa is provided in Table 5. Equipment and maintenance Software Training Miscellaneous TOTAL Table 5 Tampa AVL Costs" (Signpost Tec hnology 190 vehlciH) FEATURE COST PER BUS Communieetions sys1em $3,680 Location system $950 Central processjng station $2,100 $1,110 $ 180 $28 0 58,300 TOTAL COST $698.460 $180,070 $398,360 $210,800 $34,600 $52,700 $1,574,990 MU.S Department of Transportation, Federal Transit Administration. "Analysis of IVHS Benefits/Costs Studies, Proje<:.l Memorandum" (September 1993), pp. A53 A54. 2 7Hillsborough Area Regional Transit Authotlty, "Bid Proposal Summary for Mobil e Communications Terminal" (Tampa. Florida: June 1989). 32

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Kansas City -The Kansas City tra nsit agency also used the signpost technology in the i mplementation of th eir AVL system The cost per bus for the Kansas City sys te m is very s i milar to the costs of the signpost system imp l emented in Tampa. The structure of thi s particular bid allowed the truest identification of an AVL-only bid. A summary of the costs i s provided in Table 6 E quipment and maintenance T able 6 Kansas City AVL Coats28 (Signpost Technology, 284 vehicles) FEATURE COST PER BUS Communications system $5,970 Location system $55 0 Central processing station $1, 020 Software. training, m iscellaneous $100 TOTAL $7,640 TOTAL COST $ 1 ,696 480 $156,800 $289 ,990 $28,980 $2.172.250 28Kansas C ity Metro. "Bid Proposal SummafY for Automatic Vehicle Tracking System" (Kansas City, Missouri: 1990). 33

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BaltimoreThe positioning technology for the Baltimore AVL system is GPS which, as expected, requires a much more significant investment In addition to the more expensive positioning technology, the higher cost can also be attributed to AVL and radio system upgrades being combined with a light rail system The AVL system also was procured with an Automatic Passenger Counter system. A summary of the AVL costs for Baltimore is provided in Table 7. Equipment Software Training Miscellaneous TOTAL Table7 Baltimore AVL Costs" (GPS Technology, 235 vehicles) FEATURE COST PER BUS Communications system $10,320 Location system $10,500 Cenltal processing station $11,820 $620 $280 $180 $33.720 TOTAL COST $2,424,285 $2,468,425 $2, 777,750 $145 ,860 $86,285 $43, 160 $7 925,765 ztea ltimore Mass Transit Administration. "Bid Proposal Summary for AVl Communication System, Computer-Aided Dispatch, and Automatic Passenger Counting System" (Baltimore. Maryland: June 1994). 34

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Denver-The cost of the Denve r AVL system wh ich also uses GPS, is similar to the Baltimore AVL system. However, it is believed that t he communications system contributed to greater costs possib l y due to geographical co n straints. A cost summary for the Denver AVL system is prov i ded in Tab l e 8. Main t enance training and installation we r e included in the location system equipment costs. Equipment Table 8 De-nver AVL Costs" (GPS Technology, 600 veh i cles) FEATURE COST PER BUS Communications system $ 1 1,350 Location system $1,700 Central processing stalion $3,140 Software. training. miscellaneous $480 TOTAL $16,670 30CoJey/Forrest, tnc . p. 11. 35 TOTAL COST $6,81 1 ,350 $1,019.300 $1,665 645 $287,500 $ 1 0,003,995

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San DiegoIn add"ion to the four bid summaries obtained for AVL systems, San Diego Transit Corporation provided a bid summary for the procurement of a "communications center," referred to locally as MORDACS, or Mobile Radio and Data Communications System Although this procurement did not include AVL, it is common to include advanced communications technology with the implementation of AVL. Therefore, it was determ in e d that in clusion of this information under the discussion of AVL was appropriate. The costs for the communications center are summarized in Table 9 Equipment costs include base station equipment for three locations, along with a central communications center, vehicle rad ios, vehicle data units, vehicle data terminals, and test program software. The "miscellaneous" line item includes costs for a 12-month warranty policy and f r eight charges. Table 9 San Diego Transit Corporation "'Communications Center Costs31 (328 vehicles) FEATURE COST PER BUS TOTAL COST Equipment $7,300 $2,395,565 Training $70 $23,895 Miscellaneous $660 $215 ,290 TOTAL $8,G30 $2,634,750 l 1San Diego Transi t Corporation, "Pr oposal Form" (San Diego. California: October 24 1986) 36

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SummaryThe Tampa and Kansas C ity AVL systems were of the signpost variety and included the prowrement of the follo wing equ i pmen t : s i gnpost transmitters bus-mounted AVL receiver and associated equipment bus-mounted radio system and AVL interface central processing station for AVL computer system and dispatcher software to track vehicles and produce reports The AVL systems in Baltimore and Denver make use of GPS technology and the procurements included some or an of the following equipment: microwave or fiber-optic trunk links to connect multiple facilities expens ive or dual-purpose communication equ i pment with many options other APTS systems such as automat i c passenger counters tel ephone information systems or computerized routing systems Table 10 summarizes the AVL costs presented I n this section O ther Technology Costs As i ndicated previously, limited cost information wa s obtained for: advanced fare payment (smart cards) computerized dispatching/scheduling annunciators One bid proposal was obtained for each of these technologies The cost breakdown i s prov i ded i n Tables 11 through 13. As ind i cated previously cost information for APC systems computerized tel ephone i nformation systems, and PIDs is l i mited to anecdotal comments and rough total cost estimates that were collected based largely on discussions with transi t industry professionals. This information is presented under the heading of other miscellaneous costs. 37

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Tampa Feature Signpost Tec hnology $per Bus Total Coat Communications $3,680 $698,460 System Loca6o n System $950 $180,070 Central Processing $2,100 $398,360 Station Software, Tra i ning, $1,570 $298,100 Mise. TOTAL $8 300 $1,574 990 Table 10 Summary of AVL Costa Kanua City Baltimore Signpost Technology GPS Technology $per SUI Total Cost $per Bus Total Coot $5,970 $1, 696,480 $10,320 $2.424,285 $550 $156,800 $ 1 0,500 $2 ,4 68,425 $1,020 $289,990 $11,820 $2 777,750 $100 $28 ,980 $1,080 $255,305 $7,640 $2,172 250 $33,720 $7 925,765 38 Denver San Diego GPS Technology Communications System $per Bus Total Cost $per Bu Total Cost $11, 350 $6,811 ,350 $7,300 $2,395,565 $1,70 0 $ 1 ,0 19,300 nla nla $3 ,140 $1,685 ,845 n/a n/a $480 $287 ,500 $730 $239,185 $16,670 $10 003.995 $8.030 $2,634,750

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Advanced Fare Payment-"Smart Card" (Chattanooga) The Chattanooga Area Regional Transportation Authority (CARTA) is in the process of conducting a demonstration of an advanced, non-contact, automatic fare collect i on and accounting system for i ts planned parking garage(s) in downtown Chattanooga as well as for the downtown shuttle buses The plan is to sell parking spaces to area employees and emp l oyers For those parking in the garage(s), the downtown shuttle w ill provide transportation to job locat i ons. Use of the shuttle service will be encouraged by offering parking credits for each day the shuttle is used. CARTA plans to use a microprocessor-based fare card ("smart card") for the activation of gate and automatic fare collection equipment, and collection of ridership and billing i nformation. A cost summary is provided in Table 11. The "miscellaneous" line i tem includes shipping, insurance, site license, and installation The "spare parts" line item i ncludes an additional display mon i tor, keyboard, and extra parts for the card readers.32 Equipment Softwa r e Training Spare Parts M iscellaneous TOTAL Table 11 Chattanoog.a Are Regional Transit Smart Ca r d Costa (12 vehicles) FEATURE COST PER UNIT COST PER BUS Contad and contactless $2.040 $2.550 r eaders (15) 8K Contact smart cards $75 $ 160 (26) Contactless smart cards $10 $42 0 (500) -$2.520 $ 4 20 $200 $1.080 $7 .350 TOTAL COST $30,650 $1,950 $5,000 $30,200 $5 ,000 $2.360 $12,990 $88,150 Area Regional Transportation Authority, "RFP (and winning p roposal) for Non-Contact, Automatic Fare Collection and Accounting E quipment and Services" (Chattanooga, Tennessee : May 1994). 39

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Computerized Dispatching (Winston-Salem) -The Winston-Salem computerized dispatching and scheduling system i s known locally as the Mobility Management Project. Insta ll ed only on three paratransit vehicles in the init i a l phase of the project the costs for the system also include AVL and smart card i nterface. More spec i fically software costs include a paralransit scheduling system, two dispatcher station schedulers communications software AVL interface software and smart card interface software. Equipment costs include four workstations. a master communications station, three mobile data terminals, three e l ectronic fare card readers, and AVL hardware Costs under the "m i scellaneous" line i tem include odometer readers, a base s i gnalling unit, mobile data test set, and two modems for d i spatch office and radio l inks. The costs for the Winston Salem computerized dispatching and scheduling system are summarized in Table 12. Table 12 Winston-Salem Transa Authority Computerized Dispatching Coats" (3 paratransit veh i cles) FEATURE COST PER BUS TOTAL COST Equipment $3 1,300 $93,900 Software $ 1 2.71 0 $38,125 Miscellaneous $5.110 $15.335 TOTA L $49.120 $ 1 47.360 winstooSalem Transit Aulhority. "Phase I Equipment Costs Mobility Management Projecr (May 1994) 40

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Annunciator (Baltimore) Cost information for the procurement of annunciators to be installed on 25 transit vehicles were provided through a telephone interv iew; formal bid proposal summaries were not available. A summary of these costs is provided in Table 13. Distinguishing the line item that inc ludes engineering maintenance, tra in ing, and management from the equipment and software categories was an estimate provided by the agency in the interview. FEATURE Equipment Software Table 13 Baltimore MTA Annunciator Costs (25 vehicles) COST PER BUS $8,000 $6,000 Engineering, maintenance. training, management $3,760 TOTAL $17,760 TOTAL COST $200 ,000 $150,000 $94,000 $444,000 Other Miscellaneous Costs Cost references noted below were obtained through telephone interviews or literature review for the remaining three APTS technologies (APCs, computerized telephone information systems, and PIOs) as well as for some the technologies discussed previously. Communications Information System (often combined with A VL) The Toronto Transit Commission estimated the cost for a system-wide communication and information system to be $37.4 million, or approximately $18,700 for each of their 2,000 surface fleet vehicles. 34 The Dallas Area Rapid Transit system estimated the total cost for a system-wide communication and informatio n system to be $17.8 million, or $21,100 per bus.,. For a 15-vehicle fleet the California Advanced Public Transportation Systems (CAPTS) Branch of Caltrans, along with the City of Anaheim and the Orange County Transportation Authority have proposed a demonstration of a real-time transfer information system at an 34Toronto Transit Commission. "CIS Cost/Benefits" (Toronto. Canada: September 1988) p 2. "Dallas Area Rapid "Bid Proposal for Integ rated AVURadio System" (Dallas, Texas: July 1991). 41

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estimated cost of $2.45 million, or $163,333 per vehicle. However important to note that this system integrates transit and general traffic management monitoring and transfer of real-time information to travelers. Costs associated with traveler information ($1.27 million) equipment ($334,000), software development ($350,000), and integration testing ($115,000) represent 85 percent of the total demonstration proposal costs.36 Automatic Passenger Counters Urban Transportation Associates (Cleveland, Ohio) indicated that their purchase cost per bus for an automatic passenger counter is $7, 500-$8,500 each. They point out that because their system can provide such detailed passenger count data, the counters are be ing installed on only 10 percent of the transit fleet fo r adequate system-wide capture Computerized Telephone Information Systems At Metro-Dade Transit, a recent l ine item bid cost for a computerized telephone information (bi-lingual) system was approximately $700 000 .37 Computerized Dispatching/Scheduling The estimated average total cost per vehicle for a computerized dispatching and scheduling, includ i ng hardware and software ranges between $3 250-$4,000.38 Total operations center cost for hardware and software averages $65 000 Passenger Information Displays The unit cost for a Westinghouse "smart k i osk" (passenger information display) is estimated at $15,000. '"Canrans, California Advanced Publ ic Transportat ion Systems Branch (CAPTS). CAPTS Oemonsttatio n Proposal for TransiVTraffJC Manage-ment Integration and Travele r Information Projecr (April 12, 1994). Harris Electronics Systems Division, Metro-Dade CADIAVL Final Design Review Report ( December 10 1993) ; and Metro-Dade Transi' Agency, "'Proposal Summary for Customer Information Syslem (Miami, Florida: June 1 990) 38Schweiger et al. 42

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APTS BENEFITS A significant portion of ITS literatu re is devo ted to the identification of the anticipated benefits associated implementatio n, ranging from direct benefits like reduced costs and increased ridership, to ind irect benefrts such as reduced congestion and emissions However, where the lite rature falls short is in the documentation of these benefrts, particularly i n the area of APTS. Very little empirical evidence exists that documents the benefits claimed in the indus try and literature. Despite the l ack of empirical support, it is important to have a complete understanding of the benefits being cla imed The purpose of this section is to facilitate the understanding of p otentia l agency and passenger benefrts specific to each of the technologies included in this study. This will provide the background necessary for a more thorough understanding of the evaluation techniques presented in the remainder of this document. Automatic Vehicle Location (AVL) Increased Efficiency/Reduced Costs The primary benefit of AVL is the potential for increased efficiency and reduced costs through r educed labor requirements, more efficient use of exist ing labor resources, more efficient use of capital equipment, and more efficient vehicle maintenance planning.39 Improved Data Collection AVL systems can prov ide the ab ility to analyze cumulative data to determine how routes, schedules and operations can be improve d. This may include more efficient fleet and personnel deployment, reduced need for surveyors and ride checkers, and imp roved ability to tailor supply to meet demand. The result of these improvements could be either reduced costs if the decis ion is made to maintain the same level of service, or increased service if the decision is made to use the savings for service expansion."' Improved Quality of Service AVL provides a mechanism for monitoring on-time performance in real-time The actual locati on of transit vehicles ca n be compared with the expected position (based on the schedule}. Whe n transmitted to the dispatching center the potent ia l for improving on-time schedule performance is evident. In addition, as indicated in the improved data co llect i on process. AVL systems enab l e the collection of information that can imp rove scheduling and route p lanning which, in tum result in et al . pp 9-13; and Toronto Transit Commission. communkatio n s and l nrocmation Systems (CIS). Phase VI, Final Report'" (May 1986). pp. 111. 112 .. Morlok et al .. p. 12. "Schweiger et al .. p. 48 43

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improved on-time performance and service reliability. Finally, if implemented in conjunction with some other form of APTS technology real-time schedule information can potentially be relayed to passengers.'' Increased Ridership/Revenues -The potential for increased ridership and the associated fare revenue will presumably be the response to improvements in the quality of service and increased rider satisfaction." The Toronto Transit Commission estimated that an AVL system would conservatively result in a 0.5 to 1 0 percent increase in ridership."' Enhanced Image of Transit SystemThe image of the transit system i s enhanced through the effective use of advanced technology, since communities tend to develop a sense of pride in their involvement in new and innova tive concepts." Increased Security -When an AVL system is linked with a communication system, the transit system can, in essence, offer an info rma l watch" service to the communities served. When a crime or accident is witnessed by a driver or is occu rri ng on a bus, the incident can be reported through the communication system or a "panic" button and the exact locat ion of the incident will be known imme diately ... Automatic Passenger Counters (APCs) Increased Accuracy of Passenger Counting Function -An APC provides a mechanism for collecting accurate counts of b oardings and allghtings at all stops. The use of APCs enables an exact count of passengers without the requirement of ind ivi dual surveyors and/or ridecheckers. This technology is particularly effective in collecting informat i on required in the Section 15 reporting process. Reduced Labor Requirements -Passenger count information was previously collected through manual ride check surveys or informa ti on comp i led fo rm the farebox. The use of APCs eliminates the need for labor to carry out t h is process. 42Toronto Commission (May 1986) p. 121. "Molfok et al. p. 11; and Toronto Commiss i on (May 1986), p 1 1 5 roronto Transit Commission, "Communication and Information System, Evaluation Update" (June 1988). p. 9 et al., p. 32 .. SchWeiger et al p. 48; Morlok et al., p. 11; and Toronto Transit Commiss ion (May 1986), p. 12 0. 44

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Improved Route Planning and Scheduling -Access to continuous ridecheck infonnation provides unlimited opportunities for improving the rout e and schedule planning process. The infonnation provides the ability to analyze ridership by route, stop, time of day, season, and any other cross-tabulation that may enhance the process. Advanced Fare Payment Media Increased Convenience for Passenger and Driver -The use of advanced fare media eliminates the need to manually transfer the tare payment from passenger to driver. Improved Database of Fare Information -The automation of the fare payment enables the creation of a database on fare collection, which can provide more detailed infonnation regarding revenue, passengers, and origins and destinations." In addition, recent developments in smart card technology can assist transit systems in the development of more equitable and efficient fare policies ... Computerized Telephone Information Systems Improved Quality of Customer Service -Computerized telephone infonnation systems can provide improvements in the quality and effectiveness of infonnation provided to existing and potential patrons of the transit system. Through the use of management inf onnation systems andlor geographic infonnation systems (GIS), the ava ila bi li ty of infonnation i s improved and can be relayed to customers much more quickly. Prospective passengers can be provided not only with schedule infonnation but also with info r mation related to trip length, trip time, and walking distance to the bus stop. More Efficient Customer Service-An effective telephone inform ation system enables more telephone calls to be handled by fewer operators reducing the cost of labor. It is particular1y designed for use by indivi duals unfamiliar with the city and its bus routes 50 Increased Ridership/Revenue -The potential for increased ridership and revenue exists in response to improved customer infonnatio n through the telephone informat ion system. 1Schweiger et a.l. .. pp. 27, 28. 46John Collura, "'Evaluating the Use of Smart Card Systems in the Provision of Rural and Small Urban Transit Servi-ces" (Transportation Research Board. 72nd Annual Meeting, Paper No. 9311 00: January 1014. 199 3), p. 1. 9Schweiger et al., p. 7. "Schweiger et at, p. 4. 45

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Computerized Dispatching/Scheduling Improved Quality of Service -The use of this technology results in several benefits to the passengers including a faster response time, a quieter cab interior without radio communications and regular customers can use identifier numbers to reduce call time to less than 10 seconds'' Increased Efficiency-With assistance from a computer information system a customer can qui ckly schedule the most convenient trip possible based on complete knowledge. In addition as dispatchers and call-takers learn to u se the system, productivity increases and less skill is required since all information i s provided by the computerized system 52 Increased Flexibility -This type of transi t service is the most flexible in responding to specific needs and demands of the general public. The service goes where people are and takes them where they want to go Increase Ridership/Revenue -The provision of a h i gher quality door-to-door trans i t service has the potential for increasing ridership and associated fare revenues. Passenger lnfonnation Displays (PIDs) Enhanced Customer Information PIDs provide detailed information that improves the travel dec i sionmaking of exist i ng and potentia l passengers. In addition the display gives the opportunity to share any relevant information with passengers including schedule changes weather bulletins public service announcements and advertisements, among others. Increased Ridership/Revenue -The potent i al for increased ridership and associated revenue exists as a result of the advanced direct marketing techniques that are provided through the use of PIDs. The ava i lability of information and the ease with which it can be accessed increases the probability that an observer will use the service. R Stone, Gorman Gilbert. and Anna Nalevanko, Assessment of Computer Ojspatch Technology in the Porat.ransi t Industry (Federal T r ansit Administration: March 1992), p 17. "Stone et al .. p 15 46

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Annunc iato rs (Talking Bus) t=nhanced Service to PassengersThe prov ision of annunciators on transit vehicles is an additional service that transit systems can provide to passengers. Recorded announcements regard ing the next stop are particularly useful to riders who have difficulty reading or are unfamiliar with the system. In passengers i n general can relax while riding, knowing that their stop will be announced prior to arrival. Enhanced Compliance with ADA Requirements Annunciators are extremely useful in helping to comply w ith ADA requirements as it relates t o equal opportunity and access to transit services for the visually-impaired. Incre ased Safety When annunciators are used, the number of driver distractions is reduced as a result of a decline in the number of questions aske d by passengers regarding the next stop As a result, the transit vehicle is likely to be driven more safely Table 14 summarizes the potential benefits of each of the APTS technologies presented in this section as compiled from literature review and from discussions with industry professionals who have had experience with various APTS technologies 47

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Table 14 Summary of Agency and Passenger Benefrts Automatic Vehicle Location (AVL) 1 Increased Efficiency/Reduced CoS1s 2. Improved Dabl Collection 3. Improved Ouali1y of Service 4. Increased Ridership/Revenues 5 Enhanced Image of Transa System 6. Increased Security Automatic Passenger Counters (APCs) 1. Increased Accuracy of Passenger Counting Function 2. Reduced Labor Requirements 3. Improved Route Planning and Schedul ing Advanced Fare Payment Media 1 Increased Convenience f o r Passenger and Driver 2 Improved Database of Fare Information Computerized Telephone Information Systems 1. Improved Qual1ty of Customer Service 2 More Efficient Customer Service 3. Increased Ridership/Revenue Computerized Dispatching/Scheduling 1. Improved Quality of Service 2. lnaeased Efficiency 3. Increased Flexibility 4. I ncreased Ridership/Revenue Passenger lnfonnation Displays (PIOs) 1 Enhanced Customet lnfonnation 2. Increased Ridership/Revenue Annunciators (Ta lking Bus) 1. Enhanced Service to Passengers 2 Enhanced Compliance with ADA Requirements 3 Increased Safety 48

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V. ALTERNATIVE INVESTMENTS ANALYSIS The alternative investments analysis assumes that the cost of the proposed APTS investment is avai lab le for use at the full discretion of the transit system. The question is then asked, 'What investments could be made with this funding, and what impacts would these alternative i nvestments have on ridership and revenues of the transit system?" These questions are analyzed for three of t he more traditional transit investment aHernatives, including: an increase in revenue miles of service a reduction in passenger fare increase in traditional marketing activities The purpose of the analysis is to quantify the impacts of alternative investments on ridership and revenue In this exercise, a transit system is assumed to be contemplating a $1 million inv estment in APTS. This funding also is assumed to be comp letely flexible in that it could be used for any purpose at the discretion of the transit system The impact of the first two investme nts is estimated through the use of demand elastic ities. In contrast, the third investment alternative is analyzed fro m a qualitative perspective through dis cussion and literature review. SERVICE AND FARE ELASTICITIES Service and fare elastic i ties are commonly developed and used to estimate the impact of changes in levels of service and fares on transit ridership. As a result it is relat ive ly simple to consider the potential impact of an alternat ive investment des ig ned to increase revenue miles of service or to reduce the passenger fare An elastic ity of demand refers to the pe rcent change in a dependent variable resulting fro m the percent change in an independent variable For example, a service e lasticity of demand of 0.47 indicates that a 1 percent inc rease in revenue miles of service is expected to resu lt in a 0.47 percent increase in ridership The examples provided in this section assume a service elasticity of demand as p r ovided in "Patronage Impacts of Changes in Transit Fares and Services ," a report prepared by Ecosometrics in 1980. This document is recognized as the most comprehensive study of the effects of changes in fares and services on public transp ortat ion patronage'' A more recent reference from an APTA publication is used for the assumed fare elasticity of demand. 54 It "Ecosomettlcs Inc., "Pa lronage I m pact s of Changes in Trans i t Fares and Sel'lices" (U.S. Department of Transportation. 1 980). "American Public Association /Effects of Fam Changes on Bus Ridership (May 1991) 49

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should be noted that elasticities can vary substantially from system to system Therefore, the i deal situation would be to use elast i cities that were estimated specifically for the system conducting the analysis. These est i mates would be more like l y to take into account the site spec i fic characteristics of the transit service area. However i n the absence of system-specific information, generally-accepted serv ice and fare elasticities are provided in these reports. THE REPRESENTATIVE TRANSIT AGENCY The characteristics of the transit system used in the examples be low are representative of the average transit system in the United States. This information was determ i ned by taking national summary statist i cs for bus services i n fiscal year 1992 and divid i ng these statistics by the total number of bus systems. The res ult is a series of statistical indicators for a representative bus system in the States. Some basic characteristics are prov i ded i n Table 15. Table 15 Characteristics of Representative Bus System in the United States National Bus Transit System I ndicators Number of Agencies Operating Bus Servic e 339 Number ol Buses Operate
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INCREASE IN REVENUE MILES OF SERVICE The first traditional investment alternative considered is a general expansion i n revenue miles of service. T his expansion may come about in a number of ways including adding new routes restructuring existing routes, or reducing the headways on existing sc h edules In order to analyze the impact of trans f erring capita l funding to an operating investment, the amount of the proposed APTS investment must be annua l ized over the l ife of the equipment. The impacts of these annua l dollars can then be assessed as i f they were used to expand the operating budget. The annualized investment for a proposed AP T S investment is relatively easy to calculate once the total investment cost of the APTS is known, along with its useful life and the minimum attractive rate of return on capital (1) required by the transi t age ncy. In the example below the proposed APTS investment is assumed to be $1 mill i on, with the APTS eq u ipment having a useful l ife of six years. I n addition, the i i s assumed to be 7 percent, which i s typ i ca l for a transij agency assumi n g all values are in constant dollars (i.e not including t he effect of inflation in future years). 55 With these assumptions cons i de r the following: AI= T l x CRF where : AI = annualized investment n = total investment CRF =capital recover factor: [i(1+i )"JI((1+i)"-1] If i = 7% and N = 6 years then: CRF = [( 07 ) (1.07)8]1[(1.07)8 -1 ] = 0 2098 Sin ce the total investment is assumed to be $1 million the annua liz ed i nvestment can then be computed as follows (NOTE : The present value of an annuity payment of $209 796 over s i x years is $1 m i llion): AI= ($1,000 000)(0.2098) = $209 796 With an annual i zed investment estimated, the i mpact of using th i s fund i ng for the expansion of service can be assessed In the first year of the analys i s the $209,796 can be used to expand service by 37 848 revenue mi l es, or 0.82 pe r cent. Th i s i s estimated based on the operating cost "Office of Management and BudgeL "Circular N o A-94, Revised Technical Memorandum No. 64 (October 29, 1992) 5 1

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per revenue mile estimated for the representative transit agency ($209,796 I $5.54 = 37,848 revenue miles). With an assumed service elasticity of demand of 0.63, a 0.52 percent increase in ridership is expected in the first year (72 759 unlinked passenger trips).56 Wilh an assumed average fare of $0.65 this additional ridership results in a $47,331 increase in fare revenue The analysis assumes that revenue generated as a of inc reased ridership is reinvested to expand service further in the following years. This process continues for six years, which Is the estimated life of the proposed APTS technology Transferring the $1 million in funding from the proposed APTS cap ita l investment to an operating investment (service expansion), along w ith reinvestment of increased fare revenues in a 0.67 percent increase in ridership over the six-year time period (93,708 passenger trips). Table 16 summarizes the analysis. REDUCTION IN PASSENGER FARE A second investment a"emative could be to use the $1 million to reduce the average passenger fare. This likely would not be accomplished through a reduction in the full cash fare but through an expansion of fare discount programs, such as monthly passes, multiple ride tickets or reduced fares for school children and the elderly. Just as in the analysis of increased service, the annualized investment can be used to estimate the ridersh ip and revenue impacts of reducing the average fare If the annualized investment ($20g, 796) were used to further subsidize operations, the average fare could be theoretically reduced from $0.65 to app roximatel y $0.63 in the first year and maintained through the six-year t ime period. With a fare elasticity of demand assumed to be -0.40 the representative transit agency could expect to aract 129,003 additional unlinked passenger trips.$7 Although the ridership impacts of reducing fares are more significant than the increase in service presented previously (129 003 passenger trips in the first year of the fare reduction vs. 93,708 passenger trips at the end of the six-year time period with service expansion). the revenue impacts favor the service expansion. The reduction in fare results in two conflicting revenue impacts: seService elasticity for increase in bus vehicle miles (includes peak and off-peak hours}, as taken from Ecosometrics Inc .. p. xiv. disaggregate fare elasticity fot bus service, as taken from American Public Transit Association, Effects of Faro Changes on Bus Ridership, p iii 52

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TabS. 16 tmpaets of Increased Level o f Servlc:e Year Annualized Purc:h.aaed Total %Change Servk e Ridership Total %Change Revenue lnv .. tment Rev Miles Rev MUea Rev Miles Elasticily Generated Rlcle111hlp Ridership G..-.erated 0 0 0 4,589. 971 . -14,005.900 -1 $209.796 37,848 4,627,818 0 .82% 0 .63 72,759 14,078,658 0.519% $47,331 2 $209,796 8,539 4,636,357 0 18% 0 .63 16,280 14,094,939 0.116% $10,591 3 $209. 796 1,911 4 ,638,268 0 .04% 0 .63 3.636 14,098,575 0.026% $2,365 4 $209,796 427 4 ,638, 6 9 4 0 .01% 0 .63 812 14,099,386 0.006% $528 5 $209,796 95 4,638,790 0 .00% 0 .63 181 14,099,568 0.001% S118 6 $209,796 21 4,638,81 1 0 .00% 0 .63 40 14,099,608 0 .000% $26 Total nla 48.840 nla nlo nJo 93, 708 nla 0 .668% $60. 959 1 Tablo17 Im pacts of Reduced Fare Annualized Incr eased Average .Chango Faro Ridership Total %Change Revtnue R evenue N e t Fare Revenue Year I nvestment Subsidy Fare Fare Elutic:ity Generated Ridersh i p Ri dershi p Gen erated Loss Change 0 0 $0.000 $0.651 14,005,900 .. -.. .. 1 $209.796 $0.01 5 $0.636 2 .30% .40 129. 003 14,134.902 0 92% $83,918 ($209 ,796) ($125,877) 2 $209,796 $0.000 $0.636 0 .00% 0 .40 0 14 134 ,902 0.00% $0 $0 $0 3 $209,796 $0.000 $0.636 0 .00% 0 40 0 14,134,902 0.0 0 % $0 so $0 I 4 $209,796 $0.000 $0.636 0 .00% 0.40 0 14, 134 ,902 0.00% so so $0 5 $209,796 $0.000 $0.636 0 .00% 0 .40 0 14,134 ,902 0 .00% so so $0 6 $209,796 $0.000 $0.636 0 .00% 0.40 0 14,134.902 0 .00% $0 $0 so Total nla $0.D15 nJa nla nla 129.003 nJa 0 .92% -.$83,918 ($209,796) ($125.877) 53

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(1) Passenger fare revenue increases in the first ye,u as a result of new riders taking advantage of the lower fare (129,003 passenger trips x $0.636 = $83 918). (2) Passenger fare revenue declines in the first year due to the lower fare that existing riders can now pay (14 005,900 existing passenger trips x reduction in average fare = -$209,796). The net revenue impact is a $125,877 decline in passenger fare revenue. The results of the fare reduction analysis are summa rized in Table 17 on the previous page INCREASE IN TRADITIONAL MARKET I NG ACTIV I TIES In contrast to service and fare elasticities the concept of a marketing elasticity of demand is not common in the transit industry. Since the primary purpose of marketing is to capture new riders and retain existing riders, the lack of a marketing elasticity of demand makes it somewhat difficult to evaluate alternative investments in traditional marketing activities Despite this uncertainty, the potential impac ts of increased market ing are explored in this section Limited research has been conducted to quantify the impact of marketing on transit ridership. This can be attributed In part to four major reasons. First, targeted marketing traditionally receives little attention within transit systems A 1990 study of the role of marketing in mass transit revealed that marketing seldom plays an important role in the system planning and policy decisionmaking process within transit systems 58 If marketing is not emphasized as an important issue then it makes sense that l ittle research would be conducted in this area. Second, it is extremely difficult to isolate the impacts of transit marketing on ridership. Numerous factors play a role in determining r idership for a transit system including level of service, frequency of service, passenger fare, population density and the operating environment in general. Third, the impacts of marketing can vary substant i ally from system to system based on the nature and quality of marketing and promotional activities. As a result, even where research has been conducted there may be problems with applying the conclusions of a specific study area to other areas around the country. However, this same argument can be made regarding service elastic iti es since some systems may do a better job of designing and schedul i ng new service. "Mary F. Smith, Nabil Y. Razzouk, and Scad A. Richardson, 'The Role of Marketing in Mass Transrt: An Empirical Inve stigation," TransportatiOn Joumal (1990). pp. 30, 31 54

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Fourth, the interrelationship between public relations/promotion and population is extremely i mportant. In areas characterized by significant population growth and/or constant changes in the composition of the populat i on, effective and continuous marl
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In 1984, a grant was awa rd ed as part of the UMTA Service and Met hods Demonstration Program to the I daho Transportation Department ( l TD). The actual management and implementa t ion of the project was subcontracted to the Ma r ket ing Department of Boise State University (BSU). The purpose of the study was the development of mal1
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increases were maintained As a result, specific conclusions cannot be made regarding the ridership impact of using the $1 million proposed investment (annua l ized over six years). With these in m i nd, is recognized that a to marketing is a judgment call that every transit agency must make In recent years, there has been a renewed interest in the support of research and application of marketing activities, with particular emphasis on total management (TOM), the identification of transit markets, and an increased focus on the customer in general."' Clearly, the potential ex i sts for a s i gnificant retum on a marketing investment However, since the impacts of expanded marketing activ i ties cannot be generalized to the transit industry as a whole, the potential impacts of this alternative investment must be considered on a system-specific basis COMPARISON OF APTS VS. TRADITIONAL INVESTMENTS Using generally accepted service and fare elasticit ies, thi s section illustrates that it is relatively easy to estimate the ridership and revenue impacts of an expansion in serv i ce or a reduction in the average fare. This is not the case for an investment i n expanded market i ng Simi l arly, given that APTS technologies have not been fully tested and is somewhat difficult to estimate the impact of these advanced technology investments on ridership and r evenue. Therefore a range of potential ridership impacts was i dentified Table 19 provides the estimated impact of percent increases in ride r sh i p from one percent to e ight percent in increments of one percent for the representative trans i t agency For example, a one percent increase in ridership results in 140,059 additional pa s senger trips and $91 038 in i ncreased passenger fare revenue, while an eight percent increase i n ridersh i p equates to 1,120,472 new passenger trips and $728,307 in add i tional revenue. 64Recen t research in transit marketing includes Transit Cooperative Research Program (T CRP) P r otect B-2. Integrating Market Resean:h into Transit Management, TCRP P r oject F-3 Total Quality Management i n P ublic TransporlaUon ; T CRP Project H-4 8 Tronsil Markets of the Future The Challenge of Change 57

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Table 19 Ridership Impact Sc.enarlos Resulting From APTS R i dership Increase 4 in Ridorshlp Average Fare 41n Revenue 14.005.900 1% 140,059 $0 .65 $91.038 14.005,900 2% 280.118 $0.65 $182.077 14.005.900 3% 420.177 $0 .65 $273,115 14. 005.900 4% 560.236 $0.65 $364.153 14.005.900 5% 700.295 $0.65 $455,192 14,005,900 6% 840,354 $0.65 $546,230 14,005,900 7% 980,413 $0.65 $637,268 14,005,900 8% 1.120,472 $0.65 $728,307 A review of the impacts of more transit investments is provided in Tabl e 2 0 T his table summarizes the estimated impact of the investments on ridership and revenue. In order for the APTS investment to achieve the same ridership impact as a service incre ase, a 0.67 percent inc rea se in ridership would be required over the assumed six-year life of the APTS equipment. A 0 .92 percent increase in ridership would be requ ired in response to the APTS investment to match the ridersh ip impact of the reduction in av erage fare. Is it reasonable to expect this response? Table 20 Review of Traditional Transit Investme-nt Impacts Investment Alternative 4 in Ridership A In Revenue 1ncrease in Level of Service 93,708 0 .67% $60,95905 0.67% Re
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ridership increases similar to those estimated for a service increase and fare reduction for the representative transit system. Ridership changes in response to other ty pes of APTS inve stments could not be determined, but it is certainly not out of the realm of possibility to expect a similar response to several other APTS investments including advanced fare payment media, computerized telephone information systems, and passenger information displays. It is important to recognize that the alternative investments analysis looks only at ridership and revenue impacts and does not reflect the potential impa cts of other APTS benefits, such as those described in the previous chapter. When these additional benefits are considered, APTS investments appear to be even more feasible. Table 2 1 Research on the Impact of APTS on Ridership Transit System Type of APTS 4 in Ridership Automatic Vehicle Toronto Transit Commission Monitoring and 0.5% to 1% Communications System (AVM/C) ridership Metro Transit, Halifax, Nova AVM/C dec l ines were Scotia slowed and stopped ridership Oublin, Ireland AVM/C dedines were reversed Summary A comparison of traditional transit investments and APTS inv estments was conducted to determine their respective ridership and revenue impacts. The results of the comparison indicate that, for the representative transit agency, a proposed $1 million investment annualized over six years could be used to: increase revenue miles of service, resulting in 48,840 new revenue miles and 93,708 new passenger trips. This assumes that the $60,959 inc rease in passenger fare revenues is used to expand service throughout the six year time period; reduce fares, resulting in a reduction in the average fare of nearly $0.02, 129 ,003 new passenger trips, and a $125 877 decl ine in passenge r fare revenues; 59

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expand marl<.eting activities, the result of which is uncertain, given that the literature is limited on the impacts of marketing on ridership; implement an APTS technology that would require a at least a 0.67 percent increase in ridership to achieve the same result as service expansion or a 0.92 percent increase in ridership to match the impact of reducing the average fare Although limited, some evidence was presented indicating that APTS investments could potentially result in ridership and revenue impac ts similar to those resulting from expanded service and a reduced average fare. The feas ibi lity of APTS investments is further supported since the analysis in this chapter focused only on the potential for increased ridership. The potential for achieving numerous other benefits of the many APTS technologies contributes to the feasibility of many of the APTS investments. Although the impacts of APTS investments will undoubtedly vary by location and type or combination of APTS technologies implemented, this analysis provides preliminary infonnation that will enable transit systems to put the prospect of APTS investments i nto some perspective relative to more traditional transit investments. 60

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Vl. BREAKEVEN ANALYSIS The breakeven analysis presented in this chapter is based largely on the research effort of Morlok. Bruun, and Blackmon.$< The focus of the Morlok research was to advance the state-of the-art in the evaluation of Advanced Vehicle Mo nit oring and Communication systems (AVM/C). AVM/C refers to an AVL system that also includes advanced communication capabilities. This section updates the Morlok model using 1992 national transit statistics and extends the model to consider some of the external benefits that could potentially result from the impleme ntation of AVM/C systems. Two major conclusions resulted from the Morlok study: ( 1 ) AVM/C systems have great potential for improving the productivity of bus t ransit by either decreasing operating costs increasing revenues or some combination of both, depending upon the objectives of the transit system. (2) AVM/C systems have the potential to recoup their entire cost from operating and capital cost savings. These conclusions were based on secondary data sources such as studies conducted in Cincinnati and Toronto In Cincinnati, an operationa l test of AVM/C was conducted with 30 buses Operational tests results indica ted that weekday bus miles declined by 7.2 pe r cent, while platform hours were reduced by 8.2 percent. This was translated to a 2 percent reduction in t he agency budget. The overall conclus ion of the study suggests that, if implemen ted system-wide, AVM/C could reduce peak hour buses by 2 percent. Another study that was conducted in Toronto concluded that routes equipped wi th AVMIC required 4 3 percent to 9.2 percent fewer buses than other routes. Several other examples were also cited in the Morlok study Based on these conclusions a breakeven analysis was developed to assist in determining the productivity improvements necessary to breakeven on an AVM/C investment. The methodology for conducting t his analysis is presented in the remainder of th is chapter. The analysis is extended to inc lude a l ook at some of t h e external benefits that could potentially result from the se improvements in productiv it y Characleristics of a represen tative trans i t system are first defined using national aggregate t ransit statistics; this system is t hen used to illustrate the breakeven analysis The result i ng ana lys is is conserva t ive in nature since it i ncludes only those agency benefits that stem from financial impacts "MMok et al. 61

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REPRESENTATIVE TRANSIT SYSTEM Similar to the example provided in the alternative investments analysis, a representative transit system is used to demonstrate the breakeven analysis. The data required for this analysis are provided in Table 22. Table 22 Data for Demonstration of Breakeven Analysis Aggregate Bus Trans i t System Indicators (United States) Number of Agencies Operating Bus Service 339 Number of Buses Operating in Peak Servioe 43 ,847 Total Bus Operal!ng Expense $8,625,100,000 Bus Vehicle Operat i ons Expense $4 909,700,000 Vehicle Main ten ance Expense $1 ,724, 100,000 Non-Vehicle Maintenance Expense $307 500,000 Materia l s and Util ities Expense $ 1,049,100 ,000 General Admi nistration E>cpense $1.683 800,000 Total Revenue Miles 1 ,556 000,000 Total Revenue Hours 122.000 ,000 Total Passenger Trips 4,748.000 ,000 Passenger Fare Revenue $3,088 ,648.310 Representative Transrt Agency Average System Fleet Size 129 Vehicle Operating Expense Percentage 56 .92% Non-Vehjcle Maintenance Expense Percentage 3 .57 % General Administration Expense Percentage 1 9.52% Materials and Ulili1ies Expense Per R evenue M i le $0.6 7 Maintenance Expense Per Revenue Mile $1.1 1 Average Passenger Trips 14,00 5,900 Farebox Recovery 35.81% Average Fare $0.65 Source: U S Department of Transportation Federal Admi n istration, National Transit Summaries and Trends From the 1992 Na tional T ran si/ (May 1994) 62

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INCREMENTAL COST MODEL A widely-accepted incremental cost model was used to conduct the breakeven ana l ysis: Total Cost (TC) =A x (revenue hours) + B x (revenue mil es) + C x (fleet size) where: (calculated using data from representative transi t agency) A = (vehicle operat i ons %) x (total expense/total revenue hours) = (56 .9 2%) x ($8 625 billion/122 million) = $40 .2 4 per revenue hour B = (material and expense per revenue mile) +(vehicle maintenance expense per revenue mile) = ($0.67) + ($1.11) = $1.78 per revenue mile C = (non-vehicle ma intenance%+ general administrative%) x (total operat i ng expense/fleet size) + [(bus cost) x (CRF)] = (3.57% + 19.52%) x ($8.625 billion/43,847 buses) + ($178,000 x 0 1259) = $67,825 per bus' The resulting to t al cost equation is: TC = $40.24 (revenue hours) + $ 1 .78 (revenue miles) + $67,825 (fleet s i ze) In order to evaluate the APTS investmen t. an incremen t al cost equation is necessary to estimate the change i n costs due to the AVM/C invest ment. The modified equation is: 11 TC = $40.24 (11 revenue hours) + $1.78 (11 revenue mites) + $67 825 (/1 fleet size) The annualized investment in the proposed AVM/C system is (as ca l culated for the Alternative Investments Analysis): AI= (t ot al APTS investment) x (CRF) + (O&M) = $209,796 G 7Purchase price assumed t o b e $178 000 for a 4Q.foot transi t bus as taken from: U S Department of Transportation, Federal Transil Adminislration, Characteristics of Urt>an Transportation Systems (Septembe r 1992). Table 3 11, Cos1s of Heavy Duly Buses (1990 doRars); CRF = capilal recovery factor= where i = minimum attractive rate of r'etum (assumed 7%) and N a l ife of bus (assumed 12 years) 63

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where: AI = annual investment CRF = capital recovery factor O&M = operat ing and maintenance cost Operating and ma intenance costs are assumed to be zero since th e survey of AVM/C systems conducted as part of the Mortok study indicated that these costs were very small and believed to be offset by related cost savings ... To break even on the APTS investmen t, the total cost reduction (t. TC) must exactly offset the investment cost in the technology. -AI= t. TC = $40.24 (t. revenue hours)+ $1.78 (t. revenue miles)+ $67,825 (t. fleet size) To simplify the equation further, it can be assumed that revenue hours will decline at a fixed ratio to revenue miles. This makes sense, particularly with small incremental changes If X is the ratio of revenue hours to r evenue miles t his equation can be rewritten as: -AI = AX (t. revenue miles) + B (t. revenue miles) + C (t. fleet size) -AI = (AX + B)(t. revenue miles) + C (t. fleet size) Reducing the model to two variables enables the equation to be portrayed graphically as presented below in slope intercept form: t. fleet size = (-AI/C) [(AX + B)/C) x (t. revenue miles) where: intercept = (-AI/C) slope of the breakeven line= -((AX + B)/C) X = r atio of revenue hours to revenue miles (assumes a constant ratio with incremental changes) To illustrate the breakeven l in e graphically, the axis points can be estimated from the previous equation: "Morlok et al .. p 37. 64

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-AI/C = -($209,796/$67,825) = -3.09 buses -{AI/(AX +B))= -[($209,796)/[($40 24)(0 0784) + 1.78D = -42,489 revenue miles The breakeven line I s illustrated in Figure 1 Figur. 1 Breakeven l ine. Tradeoff Between Reduced Fleet Size and Reduced Revenue Miles -AI C ,. -3.09 buses The breakeven line identifies the possible combinations of fleet size reduct i on and revenue mile reduction necessary to breakeven on the APTS investment. At one extreme, revenue miles of service could be ma i nta i ned with a smaller fleet size, while the other extreme is maintaining the same fleet size and reducing revenue miles of serv i ce. There are also a range of options for break ing even on the i nvestment through a comb i nat i on of r eductions in fleet size and revenue miles of service. In this examp le, the trans i t system would need to red u ce the fleet size by 3 buses (actually 3.09 buses to exactly break even) or reduce revenue miles by 42 ,489 in order to break even on the i nvestment. Many agencies are not in a to reduce fleet size in the near future, particularly if the fleet is relatively new or under a long-term lease. In these situations, fleet reduct i on may resul t in substantial financial penalties that could offset any cost savings that might have occurred For these agencies, the breakeven analysis becomes a tradeoff between a reduction in revenue miles and i ncreased revenue resulting from ridership increases due to the AVM/C system The breakeven l ine for this tradeoff is: 65

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ll revenue = (AX + B)(ll revenue miles} + A I In this variation of the breakeven analys i s the representat i ve transit system must reduce service by 42,489 revenue m i les or i ncrease revenue by $209 796 With an average fare of $0 65 (refer back to Table 22), an increase of 322,763 passenger trips (2.30 percent i ncrease) would be required to break even on the investment. Table 23 summarizes the results of the breakeven analysis for the representative t r ansit system. Tabla 23 Breakeven Analysis. Summary of Results Tradeoff Between Reduction In Fleet S ize and Revenue Miles (necessary to break even on investment) Reduction in Fleel Size 3.09 or 3 buses (.30%) Reduction in Revenue M iles -42,489 revenue (.0 93%) Tradeoff Between Reduction in Revenue Miles and Increase In Revenue (necessary to break even on investment) Reduction i n Revenue M iles -42,489 rev e nue mi l es (.0.93%) tnaease in Revenue $209 796 in far e revenue (2.30% ) lnaease in R idership 322 763 passenger ( 2 .30%) EXTERNAL BENEFITS OF AVM/C If the reduction in revenue miles of service is achieved as a resu l t of the implementation of the AVMIC system numerous external benefits cou l d be real i zed, including reduced travel time, increased safety, and r educed emissions In t h i s section secondary sources are used to quantify some of the external benefits that could potent i ally result from a reduction i n revenue miles of service. Table 24 presents a summary of some of the external benefits of AVM/C systems. It should be recognized that the estimated external benefits are extremely conservative in nature since they are estimated solely on t he basis of the reduced revenue miles of service a n d the resulting reduced exposure on the street network. The estimation does not consider the potential for additional external benefits that may result from more effic i ent provision of service, such as r educed emissions resulting from smoother travel speeds A detailed analysis of the external benefits of APTS investments is beyond the scope of this project, particularly s i nce the data result i ng from operat i onal tests are still l imited. However, the i nformation provided here does provide a preliminary i ndication of the extent of externa l benefits that could potentially be derived fro m AVM/C. 66

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Table 24 Summary of External Benefits 4 IN REVENUE MILES -42,489 Reduced Travel Time Revenue Hour/Revenue Mile Ratio 0.0784 A in Revenue Hours -3,33 1 Value of Vehicle Trave l Tame for Transit Buses $72.79 6. Vehide Travel Time Cosls -$242 ,495 Increased Safety Collisions per Mjllion Bus Revenue Miles10 23.06 1!. In Incidents Due to Reduced Exposure -0 .98 1 Estimated Cost per Incident" $44.222 4 in Accident Costs -$44,222 Reduced Emissions Average Bus Speed (mph)" t2.75 Non-Metnane Hydrocarbons (grams per mile)73 6.29 Catbon Monoxide (grams per mt&e)73 49 15 Oxides of Nitrogen (grams per mile}73 12.42 A in Non-Methane Hydrocarbon s (grams per mile) -26 7,259 1!. in Carbon Monoxide (grams per mile) 2,088 ,357 6 in O)(kSes o r Nitrogen (gtams per miSe) 27,71 9 69USDOT, FlA. Characteristics of Ulban Transportation Systems. Table 4-11 Value of V e hicle Travel Time by Vehicle Class (1990 OollalS Per Vehicle Hour); NOTE: Costs for on-the -job travel incl ude labor wages and fringes, vehiCle oos.ts. and i rw&ntory costs. For off-the-job travel_. the value of time was assumed to be 60 percent of the wage ra t e for drivers and 45 percent of the wage rate for passengers. 70t.J.S. Department of Transportation. Federal Transit Administration National Transit Summanes and Trends From tho 1992 National Transit Database (May 1994), p. 74. "USDOT, FTA, Characteristics of Urban Transportation Systems Tab le 4-19, Cost s ofPolice-Rep Oited Crashes by H ighway Functional Class (1990 doll atS) ; Assumes an average ofthelow (local road) and high (other freeway) cost per cl'ash: Cost includes medical seNices. ancillary seNices, emergency services Jost wages. lost household production. lost quality of life worl<.place disruption insurance adm i n i s tra tion legal and court, travel delay for uninvolved motorists, and property damage )' 1Average bus speed computed by d ividing revenue miles by revenue hours for the representative transit system of the U.S 131bid., Table 4-17, Illustrative Emission Factors by Speed and Calendar yea r (grams per miles }: Uses MOBILE 4.1 emission factors for heavy duty vehicles in calendar y&ar 1995; NOTE : based on th e computed average bus speed of 12.75 per hour. 67

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APPENDIX A LIST OF CONTRIBUTING AGENCIES The following agencies (and contacts) contributed data directly to this report or provided general insight and direction regarding APTS technologies: Hillsborough Araa Regional Transit (Tampa) Mr. Steve Roberts (813) 623-5853 Metr
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Federal Transit Administration (Washington, D.C.) Mr. Ron Fisher, (202) 366-4995 Mr. Sean Ricl
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APPENDIX B LIST OF APT S TECH N OLOGY VEN DORS The following are primary vendors that p ro v ide one or mo r e of the seven techn ologies d i scussed in this report. AUTOMATIC VEHICLE LOCAnON (AVL) SYSTE M S DNdReck oning M ap M atching Etak. l ne. Menlo Pari<, CA ( 4 1 5) 328-3825 Fairch ild Defense Gennantown MD (301) 428.0023 GECMarcon i Transport System Borehamwood Hertfo r dshire England <44181 953 2 030 Marl< I V T ransportation P r oducts G roup Plano TX (214) E lecttoCom Communication Systems Arl ington, TX (817) 695 7521 GECMa r oon i Transport System Borehamwood. Hertfordshire E ngland + 44181 2030 Glenayre E lectronics Cha rl otte N C (704) 553 Signposts 7 0 Navigation Data Systems, Inc. New Orleans, LA (504) 734-5566 N o rth r o p E SD NS Norwood MA (6 1 7) 762-5300 Siemens Transportation Systems. Inc. New Yor1<, N Y (212) 446 9260 T r imble Navigation S unnyval e CA ( 800) 827-8000 Mark lV Tran sportati o n Products Group P lano, TX (214) 424 651 1 Siemens Trans po rta t ion Syst ems, l ne. New Yor1<, NY (212 ) 446-92 6 0

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Locus, Inc. Madison. WI (608) 244-0500 LORAH.C and Commercial Radio Signal Tri .. ng&tlation Qualcomm, Inc. San Diego, CA (619) 587-1121 Navigation Data Systems, Inc. New Orleans, LA (504) 734-5566 AirTouch Tele ttac Garden GtOVe, CA (800) 80().7100 Code-Aiann Inc. Madison Heights, Ml (313) 583 MobiaeVision lndianapofis, IN (317) 573-2200 Pinpoitlt Communications, Richardson. TX (214) 705-2400 71 Terrapin Corporatiol"' Garden Grove, CA (714) 898-8200 E F Johnson Company Bum.svilfe, MN (8t2) 882-5500 Ericsson GE Mobile Communications. Inc. lynchburg, VA (804) 528 7000 Hughes Transp Mgt S ystems (HTMS) Ful l erto n. CA (714) 732 -o848 ElectroCom Convnunications Syttems, LP. Santa Fe Springs, CA (310 ) 948-9493

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Global Positioning System (GPS) AutoTrac Inc. Dal l as. TX (214) 480-8145 Acc-0-Point Torrance. CA (310) 618-7076 Ball Space and Systems Engineering Divis ion (BSSED) San Diego CA (619) 457-5550 Fairchild Defense Ge
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Advanced Fare AT&T IVHS Communications Systems Bridgewater, NJ (908) 658 COMS I S Corporation PiHsburgh. PA (412) 279-9110 Cubic Automatic Revenue CollecOOn Gmup San D i ego, CA (619) 263-3100 OATAFARE Mississauga, Ontario, Canada (416) 890-2794 GFI GENFARE Elk Grove. IL (708) 593-8855 Mart< IV Transportation Products Group Plano, TX (214) 423-1540 Sclllumberger T edlnologles Chesapeak e VA (804) 523-2178 Oiooover Card Services, Inc. Riverwoods. 11 (708) 405-3959 Computerized Telephone fnfonnatlon System.s Easy Slteet Softwara. Inc. Raf
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Computerized Dispol<:hlng Automated Dispatch Servioes, Inc. M iami, FL (305) 471..()442 Mobil e Systems, Inc. Raleigh. NC (919) 787-9801 Micro Dynamics Cotp Evans ville I N (812) 4n-3090 Automated Business Solullons Media. PA (215) 436-8700 Mobile Computer Systems, Inc. Pari<. KS (913) 339-4088 Passenger Information Ofaplaya T eleride Sage, Ltd. Toronto, Canada (416) 596-1940 AT&T NCR North Brunswick NJ (908) 4 18-321 8 Digital Recorders. Inc. (ORI) Research Triangle Park. NC (800) 222 Lumi nal or Plano. TX (214) 424-6511 Annunciators 74 Westinghouse Transportation Systems Baltimore. MO (410) 765-8329 MetroVisi on of Nor1h America. Inc East Sy1'3C
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