Rural public transit yields nearly $4 for every dollar spent, study estimates

Rural transit in Illinois rarely makes headlines, yet for thousands of residents across the state, it is a daily lifeline.

Unlike the bus and rail systems familiar to urban riders, rural transit largely consists of on-demand services like vans that connect people to work, medical appointments, grocery stores and other essential destinations. Despite its importance, rural transit remains underfunded and understudied, even as state and local agencies invest significant resources to keep it running.

A new study from the Urban Transportation Center at the University of Illinois Chicago's College of Urban Planning and Public Affairs takes a closer look at what those investments produce. Led by center director P.S. Sriraj, the research quantifies the societal benefits of transit systems in rural areas, communities with populations under 50,000, and examines how they support broader social determinants of health, such as access to medical care and recreation.

The findings suggest that every dollar the state puts into rural transit returns nearly $4 in value through improved health outcomes, increased workforce participation, reduced strain on social services and other economic activity.

Sriraj explains what motivated the study and what the findings mean for Illinois riders, providers and policymakers. This interview has been edited for length and clarity.

Why look specifically at rural transit in Illinois?

The Illinois Department of Transportation is our main sponsor, and they serve the entire state, including rural constituents. Over the last few years, we've made an effort to ensure our work benefits the many different parts of the state.

A few earlier projects led us here. We studied how rural transit systems benefit residents traveling to health care facilities. When we looked closely at four counties in central Illinois, I quickly understood the impacts extended far beyond health care access.

There's a significant body of research on social determinants of health: access to food, employment, education, recreation, exercise and medical care. Rural transit is funded through a complex mix of federal pass-through programs and state matching funds. The state invests real dollars into these systems, yet there's very little understanding of what returns they get back. Our study tries to fill that gap by calculating returns on the state's investment, framed through the lens of social determinants of health.

Chicago residents are familiar with public transit in the form of buses and trains that pick up and drop off riders on a fixed route. By contrast, what does rural transit look like?

Rural transit is not one-size-fits-all. In rural areas, it is very rare to see a fixed route system. Almost all of these are demand-response. Riders call a local operator and provide their coordinates for where they need to be, where they are going and what time. The provider then arranges the trip.

This may be as simple as a dispatcher writing requests on paper and handing it over to a local driver. Some larger providers have software for logging these requests. Vehicles are usually minivans or small buses, not 40- or 60-foot buses. It's highly personalized, flexible and labor-intensive.

Your headline finding - a $4 return for every $1 of state investment - is striking. Where does that finding come from?

Benefit-cost analysis, especially social benefit-cost analysis, has limitations. It's difficult to combine monetary and nonmonetary variables, unless you employ advanced econometric methods.

That said, decision-makers love numbers and understand benefit-cost ratios. Based on the conventional benefit-cost analysis, a number greater than one signals "good investment." Caution must be exercised in ensuring that the results of our analysis, which indicate a $4 return on investment, is not misconstrued. In reality, the $4 return does not translate into revenue flowing back to the state. Instead, that $4 reflects the overall impact on society because of that dollar investment. These are all savings, in a way: things like health care outcomes that lead to better, reduced health care costs, reduced social service expenditures and increased participation in the labor force. That is what the $4 number is reflective of.

Given these benefits, why is rural transit still so underfunded?

Transit across the board is underfunded. Government resources are stretched thin in every sector, and that is reflected in the state of our infrastructure and various other aspects that we use on a daily basis that are all public commodities. There's also a longstanding problem with the metrics used to evaluate transit. There is a need for better metrics that will reflect the true impact of public transportation. This is partly because transit's benefits that include many positive externalities, improved public health, reduced pollution, increased mobility, are often not captured fully in the current way of quantifying the impact of transit, while on the same token, road use often is knocked for the many negative externalities like accidents, congestion and emissions. To show the true value of transit or any mode of transportation, one must "internalize" those externalities. Our study is an attempt to do that for rural transit systems.

For Illinois residents reading about this study, what's the key takeaway, whether they're in Chicago or in a rural town?

For urban residents, rural transit is an essential service that looks very different from city transit. For someone in rural areas, they can see how they can better utilize these systems to take care of their many needs. For transit agencies, the study gives them a framework as well as some hard numbers to demonstrate and communicate their value. If an agency can show that every dollar invested yields significant returns, it strengthens their case when articulating their needs to decision makers.