Association for Public Policy Analysis & Management

The Small Transit Intensive Cities (STIC) program was established in 2005 by the federal government to support and improve the performance of small transit agencies (those with service area populations below 200,000). This grants program is an example of a performance-based grants management approach in which the smaller transit agencies are awarded additional grant funding beyond the conventional population based grants if they meet targets regarding outputs, outcomes, and/or system productivity. The targets for these smaller agencies are set each year as the average performance level of medium-size transit agencies (with service area populations between 200,000 and 1 million) for that particular year on the following six performance measures: revenue miles per capita, revenue hours per capita, passenger trips per capita, passenger miles per capita, passenger miles per revenue mile, and passenger miles per revenue hour. Since larger transit systems tend to provide more intense service levels and generate higher volumes of ridership, these targets represent “stretch objectives for most smaller systems. This study employs time series analysis to evaluate the impact of the STIC program in improving the performance of the targeted agencies on each of these six measures. We analyze data over 17 years (from 1997 to 2013) for 452 transit agencies on these performance measures, which were obtained from the National Transit Database. The results indicate that the implementation of the STIC program has helped improve the performance of smaller transit agencies, but this impact has varied for the six indicators. The measures of transit outputs (passenger miles per revenue hour and revenue miles per capita) and outcomes (passenger trips per capita and passenger miles per capita) showed significant improvement after the implementation of the grants program. However, the two indicators representing system productivity (passenger miles per revenue mile and passenger miles per revenue hour) showed no improvement as a result of the STIC grants. This study has important implications for the STIC as well as other federal grants programs employing a performance-based model. The results support the notion that grants with dynamic targets can be effective in improving the performance of local agencies, and that their impact may vary across different aspects of overall performance.