The $300,000 decision

A 40-foot, ad-free bus. Photo by Kelly Davis.

When the Metropolitan Transit System rolled out a new look for its buses in 2004, it also introduced a new policy: no advertising allowed on the outside of buses carrying the updated red-and-white paint job. Since then, as old buses are swapped out for new, revenue from exterior bus ads has shrunk. In 2007, MTS made roughly $1.3 million from the ads; last year, it took in a little less than $800,000.

Meanwhile, MTS has had to raise fares and cut bus routes and is still facing a $7-million budget shortfall, due largely to a loss of $30 million in state funding.

So what was that about not allowing advertising on buses?

On Jan. 20, the MTS Board of Directors was presented with three options: continue with the policy of no advertising on newly branded buses; allow advertising on up to 100 40-foot buses, resulting in roughly $300,000 in annual revenue; or allow advertising on 170 40-footers—which would bring in $340,000, according to a report to the board. Not up for consideration was the revenue that could be generated from allowing ads on the fleet’s re-branded 45- and 60-foot buses, of which there are currently 52.

The board opted, in a 9-1 vote, to maintain the status quo.

San Diego City Councilmember Todd Gloria was the board’s lone dissenting vote. He acknowledged that $300,000 isn’t a lot of money compared with MTS’s $200-million-plus operating budget, but he estimates that it’s enough to keep a bus route going.

“If you’re an elderly person, say a person in City Heights that relies on a route that’s now being cut or eliminated or stopping on Sundays, it may not be a lot of money, but it’s a lot to them,” he said.

“The board grappled considerably with this issue and weighed that potential income gain with the value of how the new paint scheme has helped to elevate the image of transit, created a highly recognizable brand and helped cause, perhaps, gains in ridership,” MTS spokesperson Rob Schupp told CityBeat in an e-mail. In a follow-up phone conversation, Schupp acknowledged that there’s been no market research to support the link between the look of the buses and an increase in ridership.

“People choose to take public transit for many reasons,” Gloria countered. “The lack of advertising on the side of a vehicle is not one of them. People choose transit when it’s timed competitively with other forms of transportation and when the price is right.”

MTS is the largest transit provider in California that’s phasing out exterior bus ads. Neither L.A.’s Metro transit agency nor San Francisco’s MUNI have policies against exterior advertising, other than MUNI’s rule barring advertising on windows.

Schupp said MTS is exploring other ways to generate advertising revenue, like selling naming rights for trolley lines and transit stations and allowing electronic advertising at bus and trolley stations and static ads on convenience kiosks and vending machines.