Riverton Transit Authority: Electric Buses or Light Rail
The Riverton Transit Authority must decide how to spend a one-time $52 million capital grant. Option A would replace 40 aging diesel buses with electric models at $1.1 million each, including depot chargers; operating costs would fall about 30% per bus, but the depot's electrical capacity needs $6 million in upgrades. Option B would extend the Blue Line light rail by 2.3 miles and add four stations; projected daily ridership is 9,400, capital cost is $44 million, but the annual operating subsidy would rise by $2.8 million. The current bus fleet averages 12 years old and has a 19% breakdown rate during peak hours. The light rail extension would serve a corridor where bus ridership has grown 14% in two years. The authority has no dedicated funding for either option's ongoing costs, and the grant expires in 18 months. A council member has publicly questioned whether either option helps the neighborhoods with the longest commutes.
1. Recommend either Option A or Option B. Justify your choice by explicitly weighing at least two constraints from the setup, including one cost or timeline constraint.
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I would recommend Option A, but only if the authority commits to the depot upgrade in the same budget cycle. The $52 million grant covers 40 buses at $1.1 million ($44 million) plus the $6 million electrical upgrade, leaving $2 million for contingency. That matters because Option B's $44 million capital figure is not the full commitment: it adds $2.8 million in annual operating subsidy with no dedicated revenue, and the grant cannot fund that gap after year one. The bus fleet's 19% peak breakdown rate is an immediate service problem, while the rail corridor's 14% ridership growth is real but slower-moving. The strongest argument for B is capacity and long-term ridership, but the authority would be choosing a project with an unfunded operating tail over one it can fully capitalize. The council member's equity concern also favors buses: replacing unreliable buses improves service across existing routes sooner than a 2.3-mile extension.
2. Identify the strongest counterargument to your recommendation and respond to it without dismissing it.
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The strongest counterargument is that Option A locks the authority into a technology and a depot upgrade while doing nothing for the corridor where ridership is growing fastest. A critic could add that electric buses may have range limits on long routes and that the 30% operating savings are an estimate, not a guarantee. The response should concede the corridor need and separate it from the grant decision. The authority can use the $2 million contingency for a route study and seek federal or state operating funds for rail in the next cycle. On range, the authority should require a route-by-route simulation before purchase and retain diesel buses on the longest routes during transition. This does not defeat A; it makes A conditional and reversible at the margins. The key is not to claim buses solve equity or growth, only that they address the most immediate reliability failure within the grant's constraints.
3. What piece of missing information would most change your recommendation, and why?
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The most decision-relevant missing information is the actual incremental operating cost and reliability of electric buses on Riverton's routes, especially winter range and charger downtime. If the 30% savings were overstated or if electric buses could not cover the longest routes without midday charging, Option A's advantage would shrink. A second piece would be the light rail extension's operating funding source: if the state had already committed $2.8 million annually, Option B's main weakness would disappear. I would also want the breakdown data disaggregated by route, because a 19% systemwide rate could be concentrated on a few routes that electric buses cannot serve. None of this is recall; it is a test of which uncertainty actually flips the cost and service comparison.