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Members of Voices for Public Transit know public transportation benefits everyone. We’re keeping it moving.

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Members of Voices for Public Transit know public transportation benefits everyone. We’re keeping it moving.

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Supply Chain: The “Service” in Public Transit Service

While many public transit systems are public (government) agencies, they often rely on a wide range of private-sector contractors to meet their staffing or service needs. Even vehicle operations — such as driving buses or conducting trains — may be provided by licensed professional contractors rather than agency employees.

This approach to supporting the services required for public transit operations gives public transit systems greater flexibility, helps them manage costs more effectively, and keeps overall service more affordable and efficient.

What Types of Services are Contracted?

According to a study conducted by the U.S. Government Accountability Office (GAO), the majority of American public transit systems contract some or all of their operations and services. Private-sector contractors include a wide array of professionals:

  • Vehicle, system, and facility maintenance
  • Construction
  • Security
  • Technology services
  • Advertising and public relations
  • Vehicle operations

Contracting brings competitive bidding to public transit operations, which can enable systems to save costs and improve services while supporting millions of private-sector jobs.

Public-Private Partnerships

In some regions, public transit agencies enter into long-term, more-comprehensive contracting arrangements known as public-private partnerships, or P3s. Private contractors provide the financing for a public transit project or service, like a new rail line or an extension of bus service, and operate the service in return for ongoing payments from the public transit agency.

Denver’s Regional Transportation District (RTD), for example, has a P3 arrangement with a private contractor to run rail service on the city’s east side. This type of contracting can make expanding public transportation more feasible than the public transit agency or local taxpayers having to shoulder the upfront costs alone. While P3s are not appropriate for every public transportation system, they are one solution for raising funds and tapping new ideas to improve public transit.