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Minimum viable public infrastructure

# April 27, 2023

Minimum Viable Products (MVPs) are popular in startups because they allow testing of underlying risks without needing to build a full solution. In hardware companies, MVPs demonstrate that a solution can be physically built given specification constraints. In software companies, they prove that a problem is legitimate and there is consumer interest in the solution. Once you get the initial signal, iterate. Move fast and break things. The other clichés also apply.

Public infrastructure obviously isn't treated the same way. You can't iterate when you're building huge things. You also can't tolerate failure in the same way. You don't want a bridge constructed in a month only to fall down the year after. The bulk of the bureaucracy for infrastructure is making sure projects meet this bar of safety; safe to use, safe to be around, and safe for the environment.

But we do have minimum viable infrastructure: situations where we have some basic infrastructure but it's simply not good. You can check the boxes on a tourism advertisement and that's about it. It doesn't actually solve for the key needs that the infrastructure seeks to address but it's typically visible enough for people to be aware of its existence.

As one representative case, a staggering number of people I speak with in San Francisco categorically refuse to ride the Muni, which services the bus and lightrail lines in the city. Common complaints include reliability, noise, safety, and the inconvenience of switching lines. The drawbacks are so severe they've opted to avoid public transit altogether. If their destination is nearby, they'll walk; otherwise, they'll call an Uber or buy a car1.

But as someone who still rides Muni despite its problems, I'll be the first to say it's really not that bad. And given my own hesitations, I'm always surprised that I often end up being its strongest defender. But the reputation of public transit in the Bay Area is unfortunately so deeply buried in the trash can that it would be a Herculean task to lift it out. Only 57 percent of Muni riders rate its overall service positively; and that's only considering people that actually ride the Muni.

That's bad. It causes a negative flywheel - fewer people ride transit, resulting in less public support for funding transit, which in turn leads to service interruptions or cuts, and even fewer riders. The cycle continues.

Irritatingly, nothing's actually being done about it. There needs to be more investment in public transportation around US metro centers to make it legitimately useful, but I'm sure voters would galk at the pricetag to fund changes that are actually required. For comparison, here's a non-scientific comparison of SF and a few other cities2:

City Operating Budget USD Revenue USD Note Latest Project Costs USD
San Francisco 1.3B 219M (usage fares)
361M (parking fees)
Shortfall made up by city general fund and state operating grants
Large capital projects funded by proposition funds
1. 300M (Van Ness Bus Lanes)
2. 1.95B (SF Central Subway)
London 9.82B 11.32B 925M in capital renewals
518M in net interest costs
1. 25B (Elizabeth line)
2. 435M (DLR Train Upgrade)
Copenhagen Unknown Unknown 1. 2.3B (M1 & M2 Subways)
2. 3.8B (M3 Subway)
3. 492M (M4 Subway)
Auckland 2.29B (amortized budget for the decade) 2B

Muni's operating budget is $1.3 billion annually. The composition of this budget is relatively rare, however, in having such a large discrepancy between budget and revenue brought in by ridership fares. Even when you include parking ticket revenue, the SFMTA is still reliant on the city and state for the $720million of shortfall in additional subsidies. Imagine increasing the Muni budget by 2x to equate it to Auckland, or 8x to equate it to London. Based on current revenue this would mean almost all budget increases would have to be funded by additional tax revenue. Most voters would shrug and ask why. They're not going to use it anyway.

Let's take away SF's minimum viable infrastructure for a second. Let's imagine that the city had no public transit. None at all. No busses, no lightrail, no subway, no anything. Just cars on the winding hills for as far as the eye can see. It can still have a CalTrain terminal in Mission Bay, that I'll give to you.

Given San Francisco's progressive tendencies and its wealthy tax base, the absence of public transit would certainly be deemed unacceptable. Task forces would be formed, activists would get involved, and before you know it there would be a proposal on the local ballot. The outcome would be one of two things:

  1. Subsidize ridesharing, like Uber or Waymo
  2. Invest in public transit

I imagine the bureaucratic headache of the first approach would be severe but not entirely unsurmountable. More problematic is the congestion; rideshare services will need more cars to service the demand and those cars will necessarily make traffic worse. Public transit has the benefit of being able to bypass individual cars - either in dedicated lines or underground - so it can be net beneficial to reducing traffic and getting people somewhere faster.

So let's assume SF chooses to invest in a serious public transit works project. How do you pay for it? Levy additional property/sales tax most likely, or sell bonds for a future return on investment. I'd bet you voters would pass that proposition in a heartbeat - even if it ended up being a 2x, 5x, or 10x multiplier of what Muni's budget is today. The unknown whitespace of something new (dare I say - going from 0 to 1) creates excitement. The promise of a better future for a currently broken system just doesn't deliver in the same way.

The danger of having infrastructure offerings at all when they're bad is that people think they can never get good. There's nothing physically intractable about getting good infrastructure in San Francisco or in the US more broadly. It's a question of policy and funding. But I do believe those policy issues are intractable if there's not a hard fork with the current system.

Let's instead play out this:

  1. Modify California's stringent (and often unnecessarily litigious) environmental review for certain public transit projects. Have a fixed public comment window and then stop accepting roadblocks.
  2. Take two billion dollars (the same amount that SF just spent on one 2 mile extension of a subway) and invite a public competition for digging tunnels and building stations. The Boring Company is obviously a candidate but let the city put its innovation where its mouth is. I'm sure the proptech ecosystem would be thrilled to throw their hat into the ring.
  3. Create a new public-private company to manage the new effort. Cap the staffing at 20 of the best people you can. Pay them way above top of market, assuming they meet certain project milestones.
  4. Don't discount the public facing brand. Before any concrete is poured, people will look towards graphic design for signs that this effort is a break the same bureaucratic policy that gave us Muni, Bart, and Caltrain. You have some good material to tap if you're looking for inspiration.
  5. Make it go where people want to go outside of working hours. Connect Chrissy Field with the Financial District. Connect the Mission with the Sunset. Connect the Richmond with the Embarcadero.
  6. Dig. Dig out of the lime-light. Dig without having to close Van Ness for 5 years. But whatever you do, just dig.
  7. Don't open it prematurely. It's better to exceed expectations than to fall flat. First impressions are lasting. Build momentum, keep building excitement.

Then finally, in 5 years, or 10 years, release it to the public. Maybe coincide it with the first flower blooms of spring. Bypass rush hour traffic and get to the ocean shore from your office building. Go out in Hayes when you live in Potrero and pop back home. For that vision 2028 or 2033 doesn't even sound that far away.

The core of my point - and unfortunately I fear it may be true - is we need a reset on public transit. For all the promises of finally reinvesting in infrastructure development, we're not doing the best job. Voters need to be handed a more comprehensive choice: a package of law changes that make it easier to build, the establishment of learner agencies to conduct that building, and a better marketing message to the people: "If you fund this, we're going all in. It'll be worth the wait."

There's nothing minimum viable about that.

  1. When I really pushed, most people said they last tried to ride the Muni 5 years ago. Some admitted to never trying to ride it at all. Its damaged reputation so far preceded it that they just wrote it off entirely. 

  2. I looked around for a centralized source that aggregated funding, revenue, and large projects but came up short. If you dig into the raw data I was surprised to find how variable accounting models are for transit across the world. There are a lot of subtle differences in how revenue sources are reported, what is drawn from the city budget versus increases in tax rates, and how large infrastructure projects are green-lit and funded. If anyone has more updated or consistent data, please shoot it my way. 

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