Kristen Macon Cowell January 29, 2013 Honors Thesis Seminar - Professor White Urban Studies and Planning

University of California, San Diego Universities resemble small cities, thus innovations in transportation demand management at universities provide important lessons to cities. Schoup (2008) Abstract: The University of California, San Diegos Transportation and Services department is currently incurring an annual deficit of $2.1 million. In order to reduce costs and generate revenue, the university is eliminating fare-free shuttle services and local MTS bus access. The data compiled in this study indicate that eliminating fare-free bus and shuttle services will increase parking demand as a result of increased Single Occupancy Vehicle (SOV) trips. This increase is attributable to a willingness to pay for parking services relative to transit services, exposing a strong preference for driving over more sustainable transit modes. These transportation policy changes were based on a satisfaction survey performed by UCSD Transportation Services. This study postulates that the survey was inadequate to assess student willingness to make trade-offs for transportation services at specific price points. Conversely, the survey data in this analysis requires that respondents make trade-offs in transportation options, thus resulting in more accurate depictions of the market demand for commute modes. It is through this analysis that the study was able to provide critiques and recommendations to the university for more efficient pricing models and policies that align with campus sustainability goals.

I. Introduction i. UCSD Transportation Services Department The University of California, San Diegos Transportation Services (TS) provides students and faculty fare-free access to UCSD operated shuttles and MTS bus lines. The shuttles services currently operate ten lines, serving 3 million passengers per year. MTS bus access includes all routes that serve the campus, accommodating 2.5 million passengers, increasing more than ten times within the past ten years. In a report titled Parking and Transportation Needs at the University of California, San Diego 2006-07 to 2012-13 (2007), the departments of Campus Planning and Transportation and Parking Services1 outlines the success of the transportation strategies since 2000 and recommendation for the programs future. This report attributes this slow growth of parking consumption to improved shuttle and mass transit services (Campus Planning, 2007: 7). Proof of this is seen by the reduced parking demand and increased shuttle ridership. Despite the 42% increase in campus population since 1995, the campus experienced a mere 12% increase in A, B, and S spot occupancy (Campus Planning, 2007). Between 2003 and 2006, shuttle ridership increased by 50%, while S permit sales increased by only 16% (Campus Planning, 2007). The figures below delineate the other accomplishments TS had in reducing the number of single occupancy vehicle (SOV) trips by providing alternative transportation options. Overall, the percentage of SOV trips dissipated by 25% since 2001, thus mitigating parking demand and reducing CO2 emissions.

These departments were reorganized in 2012, forming the Transportation Services Department

Percentage of Commuters Using Each Mode By Single-Occupancy Vehicle By Alternatives - By Foot - By Bike - By Carpool - By Shuttle - By Bus - By Other
Figure 1.1: UCSD iCommute Report

2001 66% 34% 5% 2% 22% 1% 3% 1%

2012 41% 59% 8% 3% 26% 12% 10% 1%

Despite these successes, increased growth threatens the efficacy of these programs in reducing SOV trips to campus. In 2007, the department of physical planning reported that if the campus were to grow at steady state and no new buildings were planned, current alternative transportation programs and existing parking capacity would suffice (Campus Planning, 2007: 17). Nevertheless, the campus is projected to grow by 5,300 leaving the campus in excess demand of 1,660 parking spaces (Campus Planning, 2007). In order to mitigate this strain without suffering the exorbitant costs of parking, the authors promote the following: 1. Restricting the number of parking permits sold, 2. Negotiating with public transit agencies to increase transportation services to the campus, 3. Expanding campus-financed shuttle services to more communities, and/or 4. Raising the price of permits to pay for additional parking capacity.

ii. UCSD Transportation Services Funding

Unfortunately, the organizational structure of the Transportation Services department inhibits their ability to implement service expansions such as those listed above. Transportation Services operates under auxiliary status, meaning they cannot receive funds from the state or directly from tuition, and must be a self-sustaining service provider (California Review, 2013). Since 2003, TS has incurred an annual deficit of $2.1 million due to rising costs of providing shuttle and bus services relative to the revenue generated by other transportation programs, such as parking permits and citations. In 2009, the MTS bus subsidies cost the campus $1.46 million, 85% of this subsidy coming from parking and citation revenue (Sundstrom and Associates, 2009) In the same report, it was recorded that the campus shuttle programs costs UCSD $3.7 million annually. In light of these financial constraints, TSD is exploring solutions to continue providing quality services, while generating revenue to cover the $9.5 million spent on alternative transportation programs (Move UC San Diego, 2012). Continuing programs that reduce SOV trips subsequently reduce parking costs, an indirect effect that is often neglected in the argument for subsidized transit. Parking operations and maintenance accounts for $5.1 million and $2.1 million, respectively, of TS total costs (Move UC San Diego, 2012). The additional $5.5 million in capital debt to pay for the structures leaves parking attributable for $12.7 million of the $25.1 million in total department expenditures. The breakdown of Transportation Services expenditures is included below.

Figure 1.2: .2: Transportation Services Expenses

Figure 1.3: .3: Transportation Services Revenue

Figure 1.4: California Review, , May 2013

iii. UCSD Transportation Services Market Study In 2012, UCSD performed a study to discern the UCSD communitys s reactions to proposed transportation policy changes in order to address the deficit issue. issue The survey asked 2,000 plus students, faculty, and staff to indicate their satisfaction with various alternatives to fund transportation services, such as increasing student fees and charging for weekend parking. For each proposal, the respon respondents dents designated a number from one to ten; a value of one signified signified, extremely satisfied, while ten indicated, not satisfied at all. Survey results indicated that undergraduate students are most averse to increases in parking fees, weekend parking charges, and cutting current transportation services. Undergraduates are the most willing to transition the MTS bus zone one program to a useruser based fee program, in which students who use public transit pay a subsidized rate. Students were the least satisfied with increase parking fees and imposing a weekend parking fee. It was according to these results that TS proposed the policy changes to be implemented in fall 2013. 7

iv. Transportation Policy Changes Fall 20132 Campus Shuttles:

The CityShuttle routes (Arriba/Nobel) will transition to be covered by the MTS SuperLoop. Transportation Services is working closely with MTS to ensure that the routes will be adequately covered by additional SuperLoop buses, which will be added to the route. The Hillcrest/Campus and Hillcrest/Old Town shuttle routes were combined

Parking: Rate Increases: As parking permit fees have not increased since 2006, Transportation Services will institute small, incremental increases over the next three years. The increases slated for year one are less than they would have been if parking rates had been increased annually over the last six years. The rate schedule for monthly parking permits appear below:
Monthly Parking Permit Fees Permit Type A B S M (Motorcycle) R (Reserved) NW (Night/Weekend) Contractor Current Rate $93 $81 $61 $22 $174 $14 $176 Year 1 Rate $107 $89 $67 $30 $226 $20 $250 Increase 15%* 10% 10% 36% 30% 43% 42%

Weekend/Night Parking: Weekend parking will cost $1 an hour or $6 a day. Exceptions will include Triton Day and Commencement. Increased restrictions on overnight and long-term parking in certain parking structures from 2 a.m. to 5 a.m. will be implemented to account for higher demand for parking spaces on campus. Alternative Transportation: Coaster Club, Pedal Club, Carpool and Vanpool program members will receive free parking incentives for 12 days per year, instead of 10 days per quarter. The Transit Club and its benefits will be phased out. Please watch for our new program as it develops.

Move UC San Diego website

II. Literary Analysis Providing transportation for university campuses is a complex assignment. Universities struggle to meet the needs of all segments of the campus population, while providing affordable mobility, especially given students budget constraints.

Universities frequently subsidize parking permits, thus growing the demand for parking structures and incurring millions of dollars in debt for the construction of these colossal capital projects (Schoup, 1999). In consideration of the costs of parking infrastructure and the environmental benefits of reducing single occupancy trips, planners incorporate strategies to encourage students and faculty to use alternative forms of transportation. This literary analysis will focus on the effects of subsidizing transit on college campuses. In order to reduce parking demand and improve accessibility, universities implement Unlimited Access (UA), also referred to fare-free programs. In general, UA programs universities pay public bus services an annual amount based on projected ridership and a subsidized market rate fare. In return, students, faculty, and staff can ride public bus routes for free by showing their campus ID card (Schoup, 1999). UA benefits the public transit agency by providing guaranteed revenue and increased ridership, thus reducing average operating costs per rider (Schoup, 1999). In a study of 35 campuses nation-wide, it was found that UA increased ridership between 70% and 200% (Dorsey 2005). Permanent demand-side subsidies provide a consistent revenue source for transit agencies, which are motivated to extend service to these UA areas where they know demand is strong. Additionally, this can attract full-fare customers, thus further The benefits of these

increasing revenue to extend services within the entire system. programs have been proven in applied pilot programs nation-wide.

In 2000 UCLAs BruinGO program subsidized bus fares for students within the Blue Bus service area, making it free for students to ride within the zone. It was found that upon implementation, bus ridership increased 134% for those who lived in this service zone (Brown, Baldwin, Schoup, 2001). Within the first year of this fare-free approach, of the students within the Blue Bus Zone using the service, 29% of them were new riders, 71% of which switched from single occupancy trips to campus (Schoup, 2001). The net result was a 33% reduction in SOV commuters. University of

Wisconsin-Milwaukee also implemented a UA program and experienced a 40% decrease in the share of vehicle trips to campus, and a decrease of 5 million vehicle mile trips (VMT) (Meyer and Beimborn, 1998). Unlimited Access programs directly reduce single occupancy trips and VMT, as well as the demand for parking. Colorado State and University of Illinois at UrbanaChampaign reported a reduction in parking demand ranging from 750 and 1,000 spaces, approximately 25% of total parking supply (Brown, Baldwin, Schoup, 2003). As seen in UCSDs transportation costs, reduction in parking demand translates into enormous cost savings for universities. Parking structures are immense capital infrastructure

investments for universities. Despite permit systems and parking regulations, the reality is that for every 1,000 parking spaces, the median [academic] institution loses almost $400,000 a year for surface parking, and more than $1,200,000 per year for structured parking (Kenney, 2004). UCLAs capital debt per parking space amounts to $150 per month, while the fee is only $43 (Brown, Baldwin, Schoup, 2003). The proven benefits of fare-free transit are exhibited not only in universities, but also through employer provisioning Eco-Passes. A study of Santa Clara Eco-Pass program indicated that for

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each dollar spent on transit, offices save between $23 and $237 on parking capital investments (Meyer and Beimborn, 1998). As these studies indicate, the financial

burden from parking can be successfully mitigated through Unlimited Access programs. Unlimited Access moderates the cost of providing parking for the administration, as well as reduces the costs of attending college for students. At Washington State University (WSU) provisioning of the Eco-Pass, a UA service, reduces transportation costs to students between $2,500 and $3,500 annually (Brown, Baldwin, Schoup, 2003). In this study, UCLAs cost of subsidizing riders was directly outweighed by transfer benefits to students for books and other expenditures not related to transportation. These savings resulted in a combined fare reduction benefit (increase in consumer surplus for existing and new riders) of $524,000, more than the cost paid for BruinGO (Schoup, 1999). Given these benefits to universities, students, and employees, further assessments to determine the effects of cutting fare-free transportation services at UCSD should be conducted. III. Methods i. Survey The survey administered in this study was prepared through Survey Monkey and distributed to students through direct solicitation and social media networks, primarily Facebook. The choices included three commute modes (bus, shuttle, or driving) at three prices ($40, $60, $80), for a total of nine ranking options. Preferences for driving were indicated by willingness to pay for an S permit, the undergraduate student parking access

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pass.

Additionally, the survey asked students to indicate whether they were a campus

resident or commuter. An example of the survey ranking is provided in Figure 4.1 below.

Figure 3.1: Survey ranking commute options

ii. Data The variables were coded for STATA analysis, statistical analysis software capable of performing economic regressions. Four variables: bus, shuttle, S permit, and campus resident, were coded as binary variables. Binary variables take on a value of 0 or 1, depending on whether the attribute is included in the option. For example, if the option relates to an S permit, then the other commute variables will take a value of 0, while the S permit takes a value of 1. Likewise, if the student is a resident of the campus, the campus variable will take on a 1. There are nine rows of data for each of the respondents. A sample of the dataset is included in Figure 4.2 and 4.3 12

Figure 3.2: .2: Data rows for the first three respondents, 9 lines each for each ranking.

iii. Regression The data was analyzed using an OLS regression3, rank was the dependent variable being explained by independent variables: commute mode, campus resident, and price. price The regression used in this analysis is listed below below, , omitting one of the commute com modes to avoid collinearity. Rank = 0 + 1(spermit) + 2 (shuttle)+ 3(campus) + 4(price) + The six regressions include the mode preferences for all residents, as well as two user groups: commuters and campus residents. The clustered option allows for the respondents commute rankings to be correlated with individuals other rankings. This method increases the standard errors, as it no longer considers each observation as independent responses, essentially reducing the sample size. The coef coefficients ficients and RR

An Ordinary Least Squares (OLS) regression is a method for estimating unknown parameters in a linear regression. The estimated estimat coefficients cients indicate the isolated effect of each independent variable on the dependent variable. The variables must be uncorrelated uncorrelat to each other and the error term.

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squared values do not change when the cluster option is included. increased variation in standard errors reduces coefficients significance.

However, the

Since the survey instructions asked respondents to place their highest preference at the lowest number (value of 1), the data was re-coded so that the ranks intuitively make more sense. Rank was reversed, so that when mentioning an increase in rank it corresponds to an increase in preference for that mode. Without this reversal, negative coefficients would actually indicate an increase in satisfaction as seen by the lower rank (1 is the most preferred option and 9 is the least). Therefore, to avoid confusion, in this analysis an increase of rank will be associated with an increase in preference for that option. iv. Coefficient Interpretations Coefficients in OLS regressions allow us to isolate the effect each independent variable has on the dependent variable. The change in rank when mode shifts from driving to bus, but price stays the same, equals 2. The change in rank when price changes by one-unit, but mode stays the same, equals 4. Change in price has equal and opposite effects on rank, so that rank stays the same. These two inequalities can be set equal to each other, cancel out the change in rank terms, and solve. The result says that if mode changes from driving to bus and price changes by enough to keep rank constant, then the change in price must be B4/B2. Intuitively, this means that in order for rank to

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change (i.e a respondents s preference for a mode option) and their utility to remain the same, there must be a trade-off off in price4. The last two rows indicate the trade trade-off off associated with each alternative commute mode, parking and shuttle, relative to the base choice, bus. Dividing the coefficient on the independent variable by price derives this trade trade-off off value. The value indicates that if the price for the alternative commute mode (parking or shuttle) were to change by this amount, the respondents would be equally as well off using this commute mode or the bus. In other words, X is the coefficient of the commute mode (Commute Mode: Mod S Permit
Shuttle) / or

(Price). Therefore, X is the willingness to pay (if sign is negative) or compensation

(if sign is positive) to change commute mode. This value will be considered the value required to maintain students utility utility; for example, in Figure 4.1, this value would be $15. $15

Figure 3.4: .4: A pictorial explanation of coefficient interpretation

Utility is the representation of preference for one good or service. In order for one to ma maintain intain utility across a change from goods or services, there is a required trade trade-off, off, assuming the user is not indifferent. However, if this trade-off off is not made, the users utility will change, this value if known as marginal utility

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v. Coefficient Significance The coefficient on S permit and price remain statistically significant at the 95% confidence interval for all models in the study. The coefficient on shuttle is insignificant at the 95% level in all regressions. Although the coefficient on shuttle is statistically insignificant, the variable helps to explain the model as seen by the increase in the Rsquared term when the shuttle variable is included. The estimate is our best guess given the sample size, and the low t-scores designate that with a larger sample size the coefficient on shuttle could achieve higher statistical significance. For these reasons it will be interpreted as a relevant explanatory variable in this analysis. V. Results i. Commute Demand for All Residents The trade-off values indicate the most preferable commute mode, as determined by the willingness to pay for that mode, relative to bus services. In order to maintain their utility, the average respondents require compensation of $13.85 per month to switch from parking on campus to using the bus, compared to a significantly smaller compensation to switch from shuttles to buses, $2.48. Essentially, Transportation

Services can increase parking by $13.85 and the user will remain equally as well off taking the bus as driving to campus. However, users perceive shuttles and buses as closer substitutes, requiring only a $2.48 compensation to take the bus over the shuttle. Likewise, they will pay for shuttle services, whereas they require a subsidy to take the bus and keep their utility level the same. Overall, this data indicates that students prefer

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driving and taking the shuttle over bus commutes, however the higher price associated with S permit trade-off over shuttle means driving is the most highly preferred mode. ii. Resident Bus Demand The binary variable, campus, allows the analysis to segment the market results between campus residents and commuters. Once the two user groups are distinguishable the gap between willingness to pay for commute modes across different users becomes apparent. The data indicates that commuters will sustain a $15.76 increase in S permit prices to maintain their utility for parking compared to bus. However, residents require only a $10.88 reduction in parking to switch from using the bus to driving. Intuitively, this makes sense, as commuters must visit campus via one form of transportation or another, while not all campus residents own cars and thus do not demand parking at any price level. Therefore, campus residents without cars demand alternative transportation to run errands, commute to employment, and traverse the region, potentially accounting for the variation in trade-offs across user types. This observation is upheld in the positive sign of the shuttle trade-off price for residents indicating that the trade-off is actually positive. Commuters will pay $4.35 in shuttle prices per month in order to switch from bus to shuttle, however, campus residents actually must be compensated a value of $0.46 to switch from bus to shuttle services. This is the only case in the study where we observe a preference for buses over shuttle commutes, as seen by the fact that the price for buses actually needs to increase in order for the user to maintain their utility. This indicates residents do not value the shuttle services, and would pay to keep bus services over shuttle services. In accordance with

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the previous point, shuttle services target commuters by facilitating trips from surrounding residential areas to campus. However, campus residents do not participate in these commutes as they live on campus, and thus require other transportation solutions to traverse the area for shopping, employment, and recreation. iii. Commuter Shuttle Demand The most relevant model in explaining change in ranking is the un-clustered commuter analysis (regression 3). This determination is specified by the highest Rsquared term and the most significant variables, as it is the only regression in which shuttle is significant at a 90% confidence interval. Regression 3 exposes commuters as a price elastic market, enduring the highest price increases to maintain utility/ranking for parking and shuttle services relative to bus options. To remain equally as well off as using the bus the monthly shuttle price can increase by $4.35 and parking by $15.76. As discussed in the previous section, commuter preferences contrast that of residents. The positive coefficients on resident trade-off indicates that they would need to be compensated to take the shuttle for them to be equally as well off as using the bus; whereas, on average commuters will need more than a four dollar increase. This data entails that when studying the demand for transportation services at UCSD it is important to distinguish between residents and commuters in order to accurately assess market demand and make pricing decisions. In UCSDs Transportation Services survey, respondents identified themselves as undergraduate, graduate student, faculty, or staff. This methodology did not consider the distinctive lifestyle differences between those living on campus and those commuting on

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a daily or semi-daily basis. The opposing magnitude and direction of the trade-offs for shuttle and parking services across the two undergraduate types (+ $0.46 and - $4.35) indicate that the market for transportation services is segmented between the two user types, and thus uniform pricing may not be the most efficient model.

Figure 4.1: Regression Output

iv. Effect on Parking Demand Regardless of user type, the parking trade-off for is exceptionally higher than shuttle services, approximately 5.6 times higher than the shuttle option. Users will be equally as satisfied with parking versus taking the bus given a $13.85 monthly increase in price. Likewise, the regression works in both directions, given a $13.85 savings users will be equally as well off using transit relative to parking. Thus, it can be determined

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that in order to entice students to leave their cars at home and take transit, a significant subsidy is required for transit. Conversely, respondents only require $2.48 compensation to switch from shuttles to bus services, a significantly smaller subsidy, but nonetheless still a subsidy. The study concludes that the demand for parking is the most price inelastic commute mode, meaning that it can sustain the highest price increase before users will substitute for another commute mode. VI. ANALYSIS i. UCSD Survey It is the opinion of this study that the UCSD market satisfaction survey conducted in 2012, which subsequently provided the basis for the proposed transportation policy changes, is not adequate to execute transportation decisions. The survey does not require respondents to make trade-offs between proposed changes, and thus allows them to express dissatisfaction with all options that require sacrifices without eliciting an ordinal rationale. The survey does not provide a comprehensive analysis of community

preferences relative to other options, thus it is inadequate to determine the most favorable strategy to address the deficit and raise funds. The results of the analysis performed in this study expose the weaknesses of this method of evaluating respondent data. In these results, an astounding 59.6% of

respondents indicated that they would not be satisfied at all if the university were to increase parking fees (Move UC San Diego: Survey Results, 2012). Though, when

forced to make choices across prices and commute modes through a ranking system, in order to preserve their utility from commuting, the average respondent was willing to pay

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$13.85 more in parking fees relative to bus services. This studys survey data indicates that when required to make sacrifices, respondents will endure price increases in order to avoid transportation mode shift. The UCSD survey did not account for this fact, thus finding overwhelming opposition to increasing parking fees, when this may not inherently be the case given substitutive alternatives. Further evidence of the surveys inadequacies can be seen in the inconsistent results of preference and commute mode share. 25.9% of undergraduate respondents were not satisfied at all with transitioning the bus services program to a user-based fee program. Bus commuters represent 10% of the mode share, the percentage of the campus community using MTS bus services. Thus, it is expected that only 10% of respondents, the bus users, would be against the user-based fee program. Yet, a much larger

proportion, 25.9%, of respondents indicated extreme dissatisfaction with this proposal. This denotes there is an overall resistance to eliminating Unlimited Access services at UCSD, a resistance that exceeds those who actually consume it. This is interesting given the data in this study, which found that the bus was least preferred to both driving and taking the shuttle. In other words, given this overwhelming disregard for bus trips, it is reasonable to expect that less than a quarter of the population would be extremely dissatisfied with a user-based program, especially since 90% of the population does not use it. These contradictions continue through out the survey results, indicating that UCSD survey approach failed to capture the data associated with students prioritization of modes based on relative preferences for services. In line with this summation, 41% of UCSD community commutes via SOV trips, yet 59.6% of respondents indicated that they

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would be extremely dissatisfied with parking permit increases. Thus, it is according to this 25.9% dissatisfaction with user-based bus fees, compared to 59.6% for parking permit increases, that TS sought to implement a user-based fee program over increasing parking prices to resolve the transportation deficit. This majority rules approach may seem reasonable, yet when the entirety of UCSDs commute situation is put into context it appears less rational. As previous research speaks to the extensive benefits of Unlimited Access, and the regression indicates a willingness to pay for parking, basing policy decisions on a satisfaction survey appears imprudent. The reason for the results of the UCSD survey, in which opposition to service reductions or price increase exceeded the participating market, are innumerable and speculative. But what is important is that the UCSD survey captures an over-stated aversion to increased prices and reduced services beyond those that the policy affects. This data suggests that regardless of mode consumption,

respondents are collectively against price increases and service reductions, regardless of whether they consume it or not, an extraordinarily predictable conclusion. ii. Policy Price Changes UCSD Transportation Services policy and price changes are operating in reverse of the commute mode trade-off incentives found in this study. Parking prices are

undergoing a mere $6 (10%), yet the fare-free bus and shuttle programs are eliminated, replaced by a $28 monthly pass. Conversely, the data indicates that residents and

commuters will sustain an increase in S permits to maintain the same utility as using the bus services, $10.88 and $15.76, respectively. Collectively, students will only pay $2.48

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to retain the shuttle services. Likewise, this translates to a $2.48 payment to switch to bus services and remain equally well off. Nevertheless, the shuttles replacement via the MTS bus service, a $28 monthly fee, is approximately $25 more than the average student would be willing to pay for a service identical to shuttles, let alone the replacement MTS SuperLoop. This unwillingness to pay for alternative transportation will result in

substitution to SOV trips for a portion of the commuter population depending on preference for buses, as well as individual budget constraints. With the elimination of shuttle services, which accounts for 12% of the mode share, it can be assumed that in the future these riders will split between driving and using the bus, depending on individual preferences. Yet, in observation of the data presented in this study and the forthcoming MTS bus fee, this mode share will most likely shift to driving, as the fee for bus passes exceeds the trade-off required for students to choose bus commutes over parking. The effects of ranking and trade-off prices when there are only two commute choices will determine what portion of this 12% switches to driving and the resulting effect on the parking demand. If the campus wants to remain on track with sustainable goals, both environmentally and financially, they need to keep these fare-free alternatives to SOV trips. As the policies exist now, they will set the Transportation Services department

back in greening the campus and avoiding the financial burden associates with parking demand. The figures compiled in this study indicate a willingness to pay more for parking relative to transit at a sustained utility level, however they require compensation to switch from using the shuttle or driving to using the bus. This would suggest that if

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the campus seeks to increase funds and reduce parking congestion they should increase parking fees to this trade-off threshold, and maintain fare-free bus and shuttle service. iii. Price Discrimination The prior analyses consider student responses as a whole without segregating the responses by campus resident or commuter. Nevertheless, One of the most interesting observations in this study was the singular case in which the shuttle trade-off took on a positive coefficient. This implies residents willingness to pay for bus services over campus shuttles, whereas as all commuters and students as a whole require compensation to switch to bus from both shuttle and driving. Granted, the fee is a minimal $0.46, however it does signify that there is a potential to charge resident, whether through a marginal fee or by phasing into a use-based fee program. Alternatively, the data indicates that to keep commuters using the bus, subsidies need to remain in place, thus this revenue opportunity does not exist. These distinctions in preference and willingness to pay identify an opportunity to charge user types different fees. In contrast to residents, commuters are willing to pay $4.35 per month to use shuttle services relative to the bus, compared to $2.48 for respondents overall. Moreover, this observation fails to account for those who actually use the shuttle, which, if assessed separately, would most likely estimate a higher valuation. Consequently, a monthly student fee could be implemented on all commuters for shuttle programs. A transportation fee for commuters can act as a tax and help deter unwanted behavior, such as SOV trips that increase the demand for parking, congestion, and carbon emissions.

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Despite the logic behind charging fees to different user groups based on their willingness to pay, it remains contentious to charge users for a service they do not all consume. It makes sense in the case of commuters, in which the fee encourages them to use more sustainable alternative transportation by indirectly penalizing automobile trips with a tax. However, imposing a fee to campus residents for bus services when not all students use the bus nor contribute to parking demand renders this approach less reasonable. Therefore, implementing a user-based fee program for residents could avoid this issue while still generating revenue and taking advantage of their positive trade-off for bus services. However, this price would have to be low enough as to keep the bus preferable to bringing a car for off campus trips. Opposite to resident market segment, the data indicates that if user-based fee strategy were applied to commuters there would be a reduction in alternative transportation ridership. Further data would need to

recorded and analyzed in order to make further determinations as to the feasibility of these fee structures. Charging only one type of student for a service, can appear unfair and will likely face opposition in the labyrinths of university policy. However, purely in terms of economic efficiency, based on the data collected on student preferences it makes sense to charge commuters for shuttle operations and residents for bus services at some level. Thus, in order to gain funding for bus services and mitigate parking demand, only one segment of the market can be charged for either type of services. This raises questions of equity and feasibility in actually passing these student fees, however it is a compelling strategy to achieving a more efficient pricing structure for UCSD campus services.

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iv. Funding Structure So far, the recommendations in the analysis disregarded the funding limitations in place for Transportation Services department. Operating under an auxiliary status, TS cannot raise funds through tuition and student fees, but rather they must be a selfsustaining entity. The origins of this funding structure originated from aversions to student-wide funding for major capital parking projects, an investments that not all students would utilize or benefit from, merely contribute to funding. (California Review, 2013). For these reasons, mandating campus-wide fees to provision this public good is controversial, and these limitations extend to bus and shuttle services. In considering the appropriateness of transportation funding through general student fees, the external costs of the infrastructure should also be considered. As seen by figures in the literary analysis and UCSDs expenditure, investing in more parking structures will increase debt and operations costs, all while encouraging more SOV trips. The external costs of providing parking include increased CO2 emissions, local congestion, impermeable hardscape, and inefficient land use, as well as numerous other considerations. Conversely, providing public transportation has the opposite effect on all of these externalities. Therefore, UCSD administration should consider amending

Transportation Services auxiliary services to allow general student fees to fund transportation with positive environmental impacts. Like the commuter fee, this could support expanding existing services, and tax students who choose to drive and not take advantage of the services they already pay for in fees.

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The university most likely wants to avoid the student backlash as a result of proposing an amendment that can increase student fees. Consequently, they can maintain the auxiliary status and raise funds for the shuttle and bus services through increase S permit fees. If the price of parking were to rise to the equilibrium level, transit services could be expanded thus providing a higher quality service and increasing ridership. Likewise, as ridership increases and transit becomes a viable alternative to SOV trips parking demand will reduce. It is true that given this reduction, subsequent funding for these transportation services will decline. However, ideally, at this point the service will have improved and meet the commuter demand that students will be willing to pay userfees over the costs of S permits. Granted, this pricing system is a long-term process, but it may be necessary to stave off financial catastrophe and compromised mobility at UCSD. VII. Conclusion The University of California, San Diegos Transportation Services department has arrived at a financial cliff, unable to support current alternative transportation services. The department seeks a strategy to raise funds and provide high quality alternatives to single occupancy vehicle trips. Within the past ten years the success of their fare-free MTS bus and UCSD shuttle services reduced SOV trips by 25%, resulting in a reduction in carbon emissions, campus congestion, and demand for costly parking structures. However, this is all being jeopardized with the elimination of the shuttle services and the $28 monthly fee for MTS transit. The satisfaction survey UCSD used to arrive at these conclusions did not capture the marginal relative demand for commute options across the

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campus population. The survey results also failed to factor the corresponding strain associated with the elimination of one service would have on the demand for another. This study provided insight into the market for transportation services at UCSD by analyzing preferences for specific commute modes and corresponding price elasticity. In addition, the analysis made these determinations while considering the varying nature of campus residents and commuter market segments. The regression data denoted

driving as the most preferred commute mode, eliciting the highest levels of compensation in order to switch to bus services, an average value of $13.85. Shuttle services were preferred to bus services, but called for an average compensation of only $2.48 in order to switch from using the shuttle services to buses. When only commuter respondents were considered, both of these values increased. The significance of this observation relays that there are distinct mode preferences in the overall market, as well as user types. Findings substantiate a pricing model in which student fees vary depending on whether the student is a commuter or campus resident. Specifically, it is found that there commuters are willing to pay $4.35 per month to continue campus shuttle services, and this is before further segregating the market between users and non-users. Imposing a transportation fee on commuters in order to fund shuttle services can serve as a tax for SOV commuters, and therefore a subsidized user fee for those pursuing more sustainable commutes such as the shuttle. The commuter market will prefer driving given a $15.76 increase in bus fees, let alone the $28 MTS monthly shuttle pass. Unfortunately, UCSDs proposed policy changes will shift commuter demand from alternative transportation options to parking demand.

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The increase in parking demand associated with these policy changes invite longterm costs to the Transportation Services department. Eliminating Unlimited Access

programs will result in negative externalities by increasing the demand for parking structures, operation, and maintenance. The positive effects of these fare-free programs are proven in universities nation-wide, increasing ridership by up to 200% and reducing parking costs by $27 to $237 per dollar spent on UA programs. UCSDs new policy contrasts the sustainable goals of the campus. Eliminating the fare-free shuttle and bus threatens to eradicate the programs decade long success in reducing SOV trips and avoiding a need for more parking structures. This study recommends that UCSD Transportation Services department increase funds to support alternative transportation through parking fees. Parking is the most elastic commute mode and will sustain the highest increases in price, additionally it produces the most negative environmental effects, and thus price increase should reflect these details. On the other hand, shuttle and bus services require subsidies in order to attract ridership, thus both services should remain fare-free to serve campus mobility and promote a sustainable campus. Pricing policies should reflect these observations, increasing parking prices rather than eliminating Unlimited Access for bus services. Providing the optimal amount of transportation services is a complex and contentious process. Campuses consist of a diverse population with varying needs and distinct preferences. Therefore, in considering these preferences in order to make

planning decisions, administrations must evaluate strategic alternative in terms of the trade-offs their constituents are willing to make for one service or another. Additionally, pricing models should incorporate the negative external effects of each policy, whether it

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is increasing carbon emissions or creating excess demand for local bus services. In conclusion, UCSDs alternative transportation system has experienced immense success in the past ten years. Therefore, their response to the current deficit should be

approached according to the suggestions listed above in order to accomplish an robust, efficient, and profitable transportation system.

Works Cited Brown, Jeffrey, Daniel Baldwin Hess, and Donald Shoup. "BruinGO: An Evaluation." (2003). Brown, Jeffrey, Daniel Baldwin Hess, and Donald Shoup. "Fare-Free Public Transit at Universities An Evaluation." Journal of Planning Education and Research 23, no. 1 (2003): 69-82. Brown, Jeffrey, Daniel Baldwin Hess, and Donald Shoup. "Unlimited access." Transportation 28, no. 3 (2001): 233-267. Brown, Bradley. "Transportation Services (TS) Financial Crisis." The California Review. Project Sumo and Associated Students. 9 May 2013. Accessed June 14, 2013. Griffin, Jade. "Transportation Services Helps Keep Campus Green," UCSD News Center, April 3, 2013, accessed May 22, 2013. Meyer, James, and Edward A. Beimborn. "Usage, impacts, and benefits of innovative transit pass program." Transportation Research Record: Journal of the Transportation Research Board 1618, no. 1 (1998): 131-138. Dorsey, Bryan. Mass Transit Trends and the Role of Unlimited Access in Transportation Demand Management, Journal of Transport Geography 13, no. 3 (2005): 235-246 "Move UC San Diego: Proposed Changes." Move UC San Diego, March 8, 2013, accessed June 14, 2013, acessed June 10, 2013. Move UC San Diego: Transportation Services Survey. Move UC San Diego, June, 2012, accessed April 23, 2013. Shoup, Donald C. "The trouble with minimum parking requirements."Transportation Research Part A: Policy and Practice 33, no. 7 (1999): 549-574. Sundstrom and Associates. Transit and Shuttle Funding Project: Review of Funding Practices at Other Universities, UC San Diego Transportation Services Department, March, 2009, accessed May 7, 2013.

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