Would you use a BART Bond for your car?

This post attempts to simplify BART and the bond required to cover its maintenance costs into a situation individuals are more familiar with, a car and loan.  ​

Imagine, you bought the most expensive car 44 years ago for $8,900 ($51,000 in 2016 dollars). It was the best car in town and even the mayor took a ride in it. You've used it every day for 40 years for commuting to work, taking your kids to school and going to the ball game with friends. It's been a great car, but now it's really showing its age.

Continental Mark IV. Costs $8,900 in 1972.

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Every year, you've done all the required maintenance to keep it running and even make it nicer. You've changed its oil, replaced the seats,  generally kept it in reliable condition. But now maintenance is getting more expensive and things like the motor just might stop working. You can't miss work because your car doesn't work. You need to do something.

You call your mechanic and share your worries. She has done a great job through the years keeping your car running and you trust her. She says their are three  options.

1. Do nothing. The car will become increasingly unreliable and the costs of maintenance will increase. This will cost less now, but will costs will grow exponentially.
2. Fix the major systems.  You can replace the engine, steering system, electrical system, wheels, and gas system.  This will take 10 years to complete and cost more than original car. The performance of the car will increase ~20%. The cost of maintaining the system will remain the same.
3. Upgrade to a new system. Technology has gotten a lot better in 44 years and now there are cars that are much faster and cost less to maintain. For about the same cost of fixing your existing car, you can buy a whole new car. Maybe even the mayor will come take a ride with you again.   ​​

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Tesla Model S. Costs $66,000

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This example with the car are similar to the situation we face with BART. The times match when BART was constructed (1972).  The costs of buying and repairing the car are proportional to the original cost to construct BART ($9.3 Billion in 2016 dollars), the estimated cost to maintain BART (>$10 Billion over the next 10 years). Determining the cost of replacing BART with a better system will be the topic of the next post.

I hope this was helpful to get an intuitive sense of the decision the BART Board and voters get to make in November.  Should we continue to maintain our Lincoln or should we upgrade with the times. 

I do support the 2016 BART bond but we need directors who know how to build a transit system that won't need another bond in 10 years. 

References:

• Cost of Original BART.
• Cost of Capital Improvements for next 10 years.