Houston Strategies

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Civic activist Barry Klein died in June. He is best known for his successful efforts to prevent zoning in Houston. He also demanded accountability from the Metro transit agency (officially called the Metropolitan Transit Authority, or MTA), particularly in the 1980s and 1990s. I took possession of Barry's transportation-related archives, and I will share a few items in this and future posts. Today's featured item is the original plan for Metro.

Prior to the August 12, 1978, public election to create the Metro, the interim board advocating the creation of Metro published a 29-page booklet called "Metropolitan Transit Authority — Metro — Regional Transit Plan". The booklet is a detailed plan and guide for the transit agency, with management objectives, instructions for governance, and projects to undertake. Let's take a look at what was promised, and what actually happened.

Transit fares and operational cost

The most eye-opening objective was to finance a minimum of 40% of operational cost from transit fares. On page 28 in the section "Operations" the document says

The MTA Board is committed by formal resolution to securing 40-50% of the annual cost of operations from farebox revenues. This is significantly higher than for many other large systems, but the METRO user must pay a fair share of the cost of operations.

On page 12 in the section "Cost-Effectiveness" the document says

Transit revenues should be increased in proportion to operating costs so that the percentage of cost offset by system revenue remains in the range of 40-50%. In no event shall application of service standards result in erosion of the total system revenue/cost ratio below 40%.

On pages 8 and 9 in the section "MTA Goals and Objectives" the document lists the following objective

Increase transit revenues in proportion to operating cost increases so that the percentage of cost offset by system revenue remains in the range of 40-50%, in order to:

• maintain the overall financial soundness and efficiency of the system; and
• encourage constant review of each transit service efficiency and operating cost

Well, we know how that promise turned out. (See 2025 Metro report for full analysis.) In 2025 Metro's operating cost was $1.076 billion and it collected $48.8 million in fares, which covered 4.53% of operating cost.

The Metro web site has financial statements back to 2001, and financial data prior to 2001 is not readily available. A January 6, 1991, report in the Houston Chronicle stated, "The recovery rate is now less than 30%." In 2001 fares were 15.3% of operational cost and performance has steadily become worse with only a minimal recovery from the Covid low of 3.4%. The average fare collected per boarding in 2025 was $0.62, which on an inflation-adjusted basis is the lowest since 2001 and almost surely the lowest in Houston's transit history. The taxpayer subsidy per boarding was $13.07 in 2025.

The 2026 Public Transportation Fact Book (page 5) reports national totals for all transit for 2024, with $11.464 billion in fares collected and $66.682 billion operating expense, which is a national average of 17.2% of operating expense covered by fares. The original Metro objective was to be better than comparable transit systems, but it is now much worse than the national average.

Getting federal money at any cost

On page 26 the document states

The MTA Board has recognized that the availability of federal tax dollars is no reason to construct a costly and unused system, as has occurred in other cities. The development of a cautious, flexible system, coupled with voter commitment of a local tax source to transit, however, is the only way to obtain this area's fair share of federal transit funds.

Metro's record is better than most transit agencies. Early Metro efforts focused on the low-cost and adaptable HOV system which serves buses, vanpools, carpools and (later) toll-paying vehicles. The first effort to build rail was squashed by Mayor Bob Lanier in the 1990s. After Lanier's exit, the first 7.5-mile section of the Red Line opened in 2004, but was built at a very low cost by modern standards, around $324 million. For comparison, the planned Austin light rail, which will be at street level very similar to Houston Metro's light rail, will cost $8.2 billion for 9.8 miles, $837 million per mile.

Metro succumbed to the "get federal money" logic for the light rail expansion. If there ever was an "exhibit A" for an ill-conceived rail line, it would be the Green and Purple Lines. These routes cost $1.41 billion to build ($153 million per mile). Metro's long-term debt excluding commercial paper and capital leases increased $551.3 million from 2011 ($301.2 million) to 2012 ($852.5 million) for the light rail expansion. Long-term debt peaked at $1.078 billion in 2016 and currently stands at $692.9 million. Ridership on the Green and Purple Lines is very low, comparable to conventional bus routes. During the last 12 months, the Green Line averaged 3940 weekday boardings and the Purple Line averaged 4626 weekday boardings. For comparison, in July, a low ridership month, 13 bus routes had ridership over 4000 weekday riders (although they are longer than the rail lines).

The good news is that Metro has built less light rail than other cities, which has limited the financial damage. In June I did a comparison of Metro to Dallas DART. Dallas has a 119-mile light rail system with 93 miles converging on downtown. Dallas light rail has not increased DART ridership or revitalized downtown. Per-capita ridership is about the same in Dallas (20.5) as Houston (19.5), even though Metro's service area is nearly twice as large as DART's. DART's long-term debt, incurred to build the light rail system, is $4.03 billion. As I detailed in the June post, businesses and sports teams are fleeing downtown Dallas and its light rail hub, causing a grim outlook for the future of downtown Dallas and expected ridership decline.

Broken promises for railroad crossing separations

On page 20 the document states

The Metropolitan Transit Authority proposes construction of 30-50 railroad grade crossing separations over a ten-year period between 1979 and 1988.

The list of 51 candidate locations is in the scanned documents below, and I mapped them for easy viewing. Here we are 48 years later and only 10 separations have been built. Three were done by HCTRA, three were done by TxDOT, one was done by Metro (Harrisburg along the Green Line) and I was not able to determine the funding for the remaining three. (Click spreadsheet image for details. It's possible Metro contributed funding to the three with unknown funding.)

The plan for railroad crossing separations targeted building projects by 1988, but very little was done. In 1988 Metro began funding the General Mobility Program (called infrastructure assistance in its financial statement), which returns sales tax revenue to local governments where tax revenue originates, targeting 25% of sales tax annually. As a practical matter, Metro's role in funding specific projects ended when it began the general mobility program. The recipients of General Mobility funds appear to have allocated funds to their priorities without regard to the original Metro plan. The City of Houston is the main recipient of General Mobility funds, and its 2025 comprehensive financial report (page 148) states that it received $190.1 from Metro and allocated $51.8 million to Capital Projects, $110.9 million to Special Revenue Funds and $27.4 million to the General Fund. Beyond that statement, it is very difficult to find the trail of money and its ultimate use. (Which Special Revenue Funds? It seems impossible to determine from the financial statement.)

While Metro's 1978 list may not reflect today's priorities, the need for railroad grade separations has not diminished. The December 2024 fatality of a Milby High School student (1, 2) focused attention on railroad crossings, with the Chronicle doing a multi-part series called "Dangerous Crossings". Nowhere in the report does the Chronicle mention that Metro promised a large program to build grade separations. In fact, in this article the Chronicle blames just about everyone except Metro: "The mayors. The school superintendents. The state lawmakers. The Congress members and senators. And yes, the train executives, who time and again would promise to improve rail safety but rarely delivered."

In a December 2024 editorial former Metro board member Christof Spieler proposed a large-scale program of railroad grade separations. He doesn't mention that the railroad separation program Metro promised to voters was mostly ignored by Metro and the subsequent recipients of Metro General Mobility funds.

Partially in response to the Milby fatality, the Texas Legislature in 2025 approved a special $250 million program for railroad separations. TxDOT is paying for the $10 million new separation at Milby High School, and $40 million is allocated for a separation at the intersection of Griggs, Long and Mykawa Roads. TxDOT recently received a $756 million federal grant for railroad separations, including three in the Houston area along US 90A in Missouri City and Sugar Land. TxDOT is completing the environmental process for two new separations along Hirsh road at Tidwell and Little York. TxDOT is now the leader in planning and funding future railroad crossing separations in Houston.

Broken promises for street intersection grade separations

On page 19 the document states

Where excessive delay to transit and/or vehicle flow is identified along major arterial streets, the Metropolitan Transit Authority will enter into joint funding commitments with local governments for the construction of grade separations or major intersection redesign. The Metropolitan Transit Authority will dedicate funding over the period 1979-1988 for improvement of 10-15 intersections. Additional intersections may be added dependent upon the participation of local governments.

The list of 19 candidate locations is in the scanned documents below, and I mapped them for easy viewing. Here we are 48 years later and only 6 separations have been built. Four separations were built by TxDOT, one (South Post Oak at South Main, phase 1 built around 1984) was at least partially done by TxDOT (US 90A bridge) and for one I don't know the funding agency (South Post Oak at West Bellfort).

Just like railroad separations, Metro mostly or totally ignored the promised projects in its plan, and subsequent recipients of General Mobility funding have also done very little for intersection improvement.

Intersection improvement needs have changed in the 48 years since the 1978 Metro list, but I can definitely confirm that two locations on the original list are still problem spots that need improvement: Richmond at Weslayan and FM 1960 at Steubner-Airline (Veterans Memorial). Four other intersections urgently needing improvement based on today's needs are Chimney Rock at Richmond, Fountainview at Richmond, JFK Boulevard at Greens Road (Bush airport entrance) and South Post Oak at Willowbend.

I remember reports of plans for a separation at Gessner and Westheimer as far back as the 1970s when I was a kid in Sharpstown. It never happened, but is still listed in the H-GAC long term plan (page 21). Could it actually get done after a 50-year delay? I'll believe it when I see it. An amusing historical tidbit I remember is the construction of the South Post Oak Road separation at South Main, around 1984. All the bridge beams were put in position, and then there was a pause in construction. Radio station KLOL had a late-night weekly television show featuring rock group music videos and comedy bits. They did a farcical news report about the the bridge deck being stolen, with authorities looking for the missing pavement. (It was humor that registered with me!)

Generally speaking, the Houston area has been a poor performer in the improvement of intersections. This is a shame, because bottleneck reduction at intersections is the easiest and most feasible way to improve traffic flow. For comparison, the Dallas-Fort Worth area has a long-running program of intersection improvements, which normally includes dual left-turn lanes and dedicated right turn lanes. In North Texas it's matter of policy to upgrade intersection design to modern standards. Here, it's entirely hit-and-miss but mostly miss, with intersection improvements mostly random and mostly on TxDOT-managed streets like FM 1960 and Westheimer.

Conclusion

Nearly 50 years after Metro presented its founding plan to voters in 1978, we can look back and conclude that Metro has mostly kept some promises but totally failed for others.

Metro promised to be financially conserverative, saying on page 28, "The MTA Board is committed to a conservative approach fiscally, operationally and technologically," and on page 26, "By the use of free public right-of-way and commitment to a flexible system using reliable, proven technology, METRO will keep costs to an essential level and avoid the costly mistakes of other cities." That promise has mostly been achieved. Metro focused on bus service and the low-cost, adaptable HOV system in its first 25 years. In 1988 it formalized its General Mobility Program to share revenue with member cities. The first section of the Red Line opened in 2004 was built at a very low cost and achieved good ridership until Covid. Limited light rail construction has limited the financial damage which light rail inflicts, even with the ill-advised Green and Purple lines. Metro carries a relatively low debt burden, $693 million in 2025.

The largest failure is Metro's promise to finance a reasonable percentage of operations with fare revenue. Metro promised a goal to finance 40% of operational cost with fares, but hasn't been anywhere close to that target in the last 25 years and in 2025 fares covered only 4.3% of operational costs. The finances of Metro have become overwhelmingly focused on transit boarding subsidies. It collected $1.086 billion in sales tax in 2025, and its operating loss was $1.027 billion, 95% of sales tax revenue. Every time someone stepped on a bus or train in 2025, taxpayers contributed $13.07.

Metro's 1978 plan promised voters an ambitious program of railroad crossing separations and intersection improvements in its first 10 years, but little or nothing was done. In 1988 Metro started its General Mobility Program to share sales tax revenue with member cities, and the cities, particularly the City of Houston, mostly ignored the projects listed in Metro's plan.

A plan formulated at a certain time, in this case 1978 during a period of huge population growth and mobility crisis, has a limited shelf-life of validity. In 48 years, much has changed in the transportation landscape to reduce public demand for transit and make service much more expensive: employers moving to the suburbs, employees working from home, dramatically increased cost for all construction especially the astronomical increase for rail construction since the early 2000s, and shifting political priorities in favor of huge fare subsidies. With self-driving cars now operational on a limited basis including here in Houston, we can expect more disruption and transit demand reduction in the future. (influencer videos 1, 2, 3)

As I've stated before in my annual analysis of Metro's financial statements, the management directive of Metro should be to provide bus service to the transit-dependent sector at the lowest possible cost to taxpayers. I have advocated reducing the boarding subsidy to its pre-Covid level of $10.96 per boarding, and preferably lower. Costly projects like light rail and bus rapid transit must be avoided because they incur debt and don't increase ridership. Going forward, we can hope that Metro will be open to adopting new technology as self-driving cars continue to make progress to the mainstream, potentially reducing costs to taxpayers and dramatically increasing convenience for its customers.