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Urban Transport

Encouraging economic growth is seen as the key driver to achieving a wide range of policy objectives, such as raising living standards and improving the well-being of citizens. However, in urban areas these gains are offset by increased car ownership and use, resulting in the often chronic levels of traffic congestion seen today. Combined with the need to ensure sustainable mobility policies for the future, policies are increasingly promoting the use of public transport and non-vehicular transport modes to develop energy-efficient mobility. Moreover, within an increasingly developed transport network, where user trips combine multiple modes, each offering its own level of accessibility and service, transport schemes need to ensure connectivity within the overall transport network to secure ridership and ensure their own sustainability.

Public bodies need to provide a coherent policy response to include integrated urban policies, sustainable funding sources with increasing efficiency and profitability and innovative public transport services that offer high quality mobility solutions. Delivery of urban transport schemes, arguably more than any other sector, requires a strong public body with authority to achieve inter-jurisdiction coordination across the urban conurbation, ensure rights of way, take charge of project delivery, monitor contract compliance, and enforce service standards. The use of public-private partnerships intensifies these requirements by exposing and quantifying related risks insofar as they relate to the specific component of the transport network under PPP delivery. Under a stable revenue structure and operating environment, PPP projects can successfully deliver successful projects by capitalizing on the private sectors ability and contracted incentives to provide efficient and sustainable transport services. 

Issues

  • Policy and planning coordination

    Delivering an efficient transportation system through PPPs can be effective if incorporated into an overall strategic plan for the transportation system. The process must be managed well, since urban areas encompass a multitude of public and...

    Delivering an efficient transportation system through PPPs can be effective if incorporated into an overall strategic plan for the transportation system. The process must be managed well, since urban areas encompass a multitude of public and private actors as well as civil society which can lead to lengthy planning and implementation decisions.

  • Land acquisition

    Limited availability of urban space can make new urban transport schemes lengthy and costly through land acquisition costs and expropriation procedures. Resettlement of affected communities can also be complex, and must be well handled to ensure...

    Limited availability of urban space can make new urban transport schemes lengthy and costly through land acquisition costs and expropriation procedures. Resettlement of affected communities can also be complex, and must be well handled to ensure project success. 

  • Rule of law

    PPPs require strong rules of law and property rights to avoid expropriation. Without this assurance, only traditional, less risky, public infrastructure provision is feasible.

    PPPs require strong rules of law and property rights to avoid expropriation. Without this assurance, only traditional, less risky, public infrastructure provision is feasible.

  • Interface

    Development of urban transport projects need to be carefully connected to other urban transport systems; ridership levels on any given system are highly dependent on the availability of feeder services, service levels on other systems and on...

    Development of urban transport projects need to be carefully connected to other urban transport systems; ridership levels on any given system are highly dependent on the availability of feeder services, service levels on other systems and on overall urban mobility policy. The delivery of a new public transport project often depends as much on the ability to interface with the rest of the urban transport system as on the quality of the project itself.

  • Fare controls and affordability

    In the urban context, mobility is a public policy objective. As a result, public authorities often control fares and, to some extent service levels to ensure affordability and coverage. 

    In the urban context, mobility is a public policy objective. As a result, public authorities often control fares and, to some extent service levels to ensure affordability and coverage. 

  • Subsidies

    Given fare controls, there are only a few public transport systems in the world recover operating costs through ticket revenues alone, given low ability and willingness to pay. Ticket revenues are thus unlikely to be able to cover any new...

    Given fare controls, there are only a few public transport systems in the world recover operating costs through ticket revenues alone, given low ability and willingness to pay. Ticket revenues are thus unlikely to be able to cover any new investment for system upgrade or expansion. Urban transport projects must therefore explore other areas of revenue generation, including land value capture, dedicated fiscal instruments, commercial revenues and contingent liability coverage. They also must rely on some degree of public subsidy, either through revenue support or capital grants.  

  • Changing environment

    The dynamic urban environment and political context can require frequent changes in the way transport services are delivered, either through an increase in service levels, an expansion of transport networks to new urban areas, an integration of...

    The dynamic urban environment and political context can require frequent changes in the way transport services are delivered, either through an increase in service levels, an expansion of transport networks to new urban areas, an integration of new transport networks and services or adjusting fare policy or revenue collection methods.

Tools & Guidance

    • 2013
    • European Union

    Guidelines for developing and implementing a sustainable urban mobility plan

    Urban mobility planning is a challenging and complex task. Planners need to manage many, sometimes conflicting demands and requirements on the local level and even beyond when it comes to contributing to European climate change and energy efficiency targets. The complexity increases in case of political change and, as is currently the case in many European countries, severe financial constraints. The guidelines are the result of a thorough and European-wide expert consultation process organised between 2010 and 2013 as part of a service contract for the European Commission. They define a Sustainable Urban Mobility Plan as a strategic plan designed to satisfy the mobility needs of people and businesses in cities and their surroundings...

    • 2007
    • PPIAF

    Toolkit on Market-Based Approaches in Private Sector Provision of Bus Services

    This toolkit is designed to help government officials and policy makers evaluate existing and alternative urban bus systems in developing and transitional countries. It offers practical advice to enact fundamental system reforms.

Projects & Case Studies

    • 2014
    • Eduardo Engel and Alexander Galetovic
    • World Bank Group (WBG)

    Urban Transport

    Can public-private partnerships work?

    Cities exist, grow, and prosper because they take advantage of scale economies and specialization wrought by agglomeration. But output growth inevitably stresses transport infrastructure because production requires space and mobility. To prevent congestion from crowding out agglomeration benefits and to expand the supply of urban land, cities must invest in transport infrastructure. Yet balancing the growing demand for infrastructure with its supply is often difficult. In particular, many cities lack the funding to maintain and expand streets and urban highways. Also problematic is that roads are managed like a social service rather than subjected to market discipline. Can public-private partnerships (PPPs) deal with these problems...

    • 2008
    • European Union

    Contracting in Urban Public Transport

    Report contracted by the European Commission -- DG TREN. The organisation of local and regional public transport in Europe was been submitted to considerable changes during the last two decades. Several kinds of legal features can govern the relationship between transport authorities and transport operators. Licences, authorisations, concessions, contracts, etc. are examples of such relationships. The legal frameworks of the various member states are determinant in the shaping of such relationships. This report provides a number of tools to facilitate the comparison of various organisational forms. This will help understanding the complexity of contracting practices in European public transport. Such comparison may then be the source of...

    • 2008
    • Roger Allport, Richard Brown, Stephen Glaister and Tony Travers

    Success and Failure in Urban Transport Infrastructure Projects

    Transport is increasingly viewed and evaluated as an integrated programme of projects as opposed to individual projects. Whilst this may be true in more successful environments, there are many differing environments worldwide and cases where this does not yet happen. This report provides an evidence-based study focused on urban transport infrastructure projects, and in particular urban rail projects, on defining success of transport projects, and importance of having good funding and procurement strategies in place at an early stage.

    • 2014
    • Mathieu Verougstraete and Han Zeng
    • United Nations Economic and Social Commission for Asia and the Pacific (ESCAP)

    Land Value Capture Mechanism

    The Case of the Hong Kong MTR

    This case study presents how a property development programme has been used to finance Hong Kong’s public transport system and discusses whether this model is replicable in other countries

    • 2014
    • Mathieu Verougstraete and Isabelle Enders
    • United Nations Economic and Social Commission for Asia and the Pacific (ESCAP)

    Traffic Demand Risk

    The case of Bangkok’s Skytrain (BTS)

    This case study examines the issue of traffic demand risk and sheds light on how the problem of inaccurate ridership forecasts can impact a PPP project by using the example of the Bangkok SkyTrain.

Lessons & Analysis

    • 2014
    • Thomas Maier, Matthew Jordan-Tank
    • World Economic Forum, European Bank for Reconstruction and Development (EBRD)

    Accelerating Infrastructure Delivery

    New Evidence from International Financial Institutions

    Infrastructure is an important driver of economic competitiveness in the present globalized investment landscape. Yet the divergence between the need for infrastructure and the ability of governments to deliver continues to widen, creating a bottleneck for growth and diversification. These gaps have widened in certain developed markets owing to limits imposed by public indebtedness and, in emerging markets, by the underestimation of the growing need for infrastructure due to population growth and urbanization. In both cases, more effective delivery mechanisms are needed. 

    • 2014
    • United Nations Environment Programme (UNEP), Rockefeller Foundation, The International Council on Clean Transportation, GTZ, Climate Works Foundation, BARR Foundation, Institute for Transportation and Development Policy

    The BRT Standard and Best Practices 2013

    The BRT Standard is an evaluation tool for world-class bus rapid transit (BRT) based on international best practices. It is also the centerpiece of a global effort by leaders in bus rapid transit design to establish a common definition of BRT and ensure that BRT systems more uniformly deliver world-class passenger experiences, significant economic benefits, and positive environmental impacts. The BRT Standard functions as a means of achieving a common definition, as a scoring system, and as a planning tool. By defining the essential elements of BRT, it provides a framework for system designers, decision-makers, and the sustainable-transport community to identify and implement top-quality BRT corridors. The BRT Standard celebrates...

    • 2010
    • Cledan Mandri-Perrott (with Iain Menzies)
    • PPIAF, World Bank Group (WBG)

    Private Sector Participation in Light Rail/Light Metro Transit Initiatives

    This book addresses the growing worldwide interest in the use of light rail metro transit (LRMT) schemes to provide urban transport solutions and reviews the potential use of public-private partnership (PPP), or private-public participation, models to support LRMT schemes. This work, funded by the World Bank and the Public-Private Infrastructure Advisory Facility, is based on extensive industry consultation and the development of case studies from recent major LRMT schemes, all involving some form of PPP arrangement. The approach begins with the basic premise that the need for an LRMT scheme has already been justified and that there is a need for a systematic approach for assessing and developing the scheme while making use of some form...

    • 2010
    • Iain Menzies, Cledan Mandri-Perrott
    • PPIAF

    Private Sector Participation in Urban Rail

    Getting the Structure Right

    In developing urban rail projects, a range of major cities around the world have turned to public-private partnership models, to leverage both public and private resources and expertise. Dissecting the successes and failures of public-private urban rail schemes, this note examines how policy makers can best deal with the main risks involved in designing, procuring, and implementing such schemes. It also draws lessons on best practice in developing and managing contractual arrangements that can help ensure their success and sustainability.

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