Motivations and Impediments to Service Contracting, Consolidations, and Strategic Alliances in Public Transit Organizations

Abstract

This article uses survey data to determine motivations and impediments to collaboration (i.e., contracting, merger/consolidation, and strategic alliance) among public transit systems in the United States. The results suggest that transit systems are more likely to contract out passenger service if they are involved in the initiation of the collaboration effort and if they are motivated by the possibility of increased resources and by government pressure. The impediments to contracting include resistance from other agencies and government funding agency restrictions. Mergers are motivated by cost savings and government initiatives (or pressure). Strategic alliances are motivated by the promise of increased service effectiveness but not so much by service quality, cost savings, or increased resources. An impediment to the formation of strategic alliances is size of required capital investment (cost of vehicles, equipment, and facilities). The article also examines the policy implications of these results.