Abstract
This study reports the results of an analysis of the potential cost impacts of private-sector-service contracting by transit agencies as well as the results of a nationwide survey of the magnitude and characteristics of existing transit-service contracting. Using cost models developed during the study, an evaluation was made of the cost impacts of contracting out 5 to 20% of the existing services of 19 medium and large transit agencies, and all service of 3 small agencies. The evaluation determined that large agencies would save 2 to 49% of the costs of the contracted service, with a mean savings of 28%, and that medium size agencies would save up to 31% of the cost of service they contracted, with a mean savings of 14%. No cost savings were indicated for some small and medium agencies. A separate analysis of potential cost savings, using a statistical model developed from data supplied by agencies which currently contract for fixed-route bus service, predicted that agencies of 100 or more vehicles would save 26 percent of the cost of contracted services.