The state’s Comprehensive Transportation Fund, which helps pay for services like Dial-a-Ride, is expected to decrease slightly over the next four years. Courtesy | Wikimedia
City raises fares, adds advertising to offset reduction
Falling support from the state government threatens Hillsdale’s Dial-a-Ride program as the city raised the subsidized transport’s fares for the second time in two years last month.
Hillsdale officials say they’re doing everything they can to keep the city’s Dial-a-Ride program afloat as state support declines and costs continue to rise.
Under the new schedule, in-town fares for adults will rise from $3.50 to $5, and fares for children, students, seniors, and individuals with disabilities will climb from $2 to $2.50. For trips to or from designated out-of-town locations, adult fares will move from $5 to $6 with corresponding increases for other riders.
“In Hillsdale, we have three options for dealing with declining transportation funding: increase rates, find alternative funding sources, or spend property tax money to subsidize the service,” Acting Mayor Joshua Paladino said. “We’re doing all three, and we will probably have to continue to do all three for the foreseeable future.”
The city is now subsidizing Dial-a-Ride at a rate of $120,000 to $150,000 a year, according to Paladino. It also recently added bus advertising to help offset the cost to the city. But the fare hikes and advertising revenue won’t close the whole funding shortfall.
“The fare increases will not cover the gap. The city will still have to appropriate money from its general fund to cover the costs of the buses,” Ward 1 Councilman Jacob Bruns said. “Furthermore, the city is likely going to have to purchase two more buses in the coming two years, amounting to over $200,000.”
Paladino said the state’s spending priorities are part of the problem.
“Municipal concerns are lower on the state’s list of priorities than special-interest handouts,” Paladino said. “State politicians apparently prefer to subsidize high-publicity investments, rather than humbly and simply sending money back to local governments to help with their core functions.”
The state’s Comprehensive Transportation Fund, which helps pay for services like Dial-a-Ride, is expected to decrease slightly over the next four years.
“Between 2018 and 2024, the state of Michigan has increased expenditures from $56.8 billion to $83.5 billion,” Paladino said. “Much of this money went to the ruling class’ preferred methods of economic development, including targeted investments in favored legislative districts and direct corporate subsidies.”
Bruns said current budget trends suggest local services will continue to feel the squeeze.
“State funding has been decreasing because the legislature and governor are appropriating less money to these programs proportionally,” Bruns said. “Meanwhile, they spend money on green energy initiatives that also cost Michiganders more.”
With uncertainty surrounding future funding, Michael LaFaive of Mackinac Center for Public Policy said cities across Michigan may need to rethink how they deliver public transportation.
“At times, effective management requires different approaches, including competitive contracting, transportation vouchers or outright load shedding,” LaFaive said. “Load shedding is an older term to reflect those times when a government gets out of a business entirely.”
He said one alternative model, which the Mackinac Center has promoted in the past, involves shifting toward ride-sharing platforms.
“The Mackinac Center has recommended an ‘Uberization’ approach in the past,” LaFaive said. “Instead of providing an expensive busing service, governments could provide digital cards for low-income riders so they can hail their own, more personalized rides.”
LaFaive also recommended shared ride models such as Uber Pool and Lyft Line, which allow riders heading in the same direction to split the cost of a trip by sharing a vehicle with others.
According to The Hillsdalian Substack, the federal government continues to cover 18% of Dial-a-Ride’s costs annually, but the steady drop in state support has increased the city’s reliance on local funds.
LaFaive said future transportation models may depend more heavily on innovation.
“The future of transportation involves autonomous vehicles and more highly nuanced ride sharing opportunities,” he said. “Far more employment opportunities are available by car than bus, something transit authorities everywhere should consider.”
Send tips to the City News team: collegiancitynews@gmail.com
