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Abstract
Transit organizations are coming under increasing pressure to change in response to financial, demographic, public scrutiny, and responsiveness concerns. The public sector monopoly on providing public transportation service in major metropolitan areas, which has been the norm for the past 20 years, is now recognized as just one of a range of organizational options, and experimentation with alternative arrangements is now well underway. While no single dominant alternative to the traditional structure has yet emerged, several possibilities can be distinguished. One strategy is based on separation of policy and strategic planning from the day‐to‐day operation of the transportation system, with different organizations being assigned these responsibilities. A second strategy (these strategies are obviously not necessarily mutually exclusive) is to use more than one operating agency to provide service, with the operating responsibilities defined either geographically or through competitive bid. Principal aims of these forms of reorganization are to avoid the diseconomies of scale which may exist in large transit authorities, to increase responsiveness, and to introduce the threat of competition as a factor in determining the cost of providing service. This paper reviews the possible alternative organizational arrangements and presents the advantages and disadvantages of each.