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Hundreds of LA bus shelters go unbuilt, millions in promised revenue evaporate under city contract

More than half of the bus shelters planned under a city of Los Angeles contract have not been built, leaving riders at more than 800 locations without shelters and depriving the city of millions in unrealized advertising revenues, a KPCC investigation has found.

While the Los Angeles County Metropolitan Transportation Authority runs most buses and decides the locations of bus stops, shelters fall on city property so they're administered by individual municipalities within the county.

The city of L.A. contracted with the contractor CBS Decaux in 2001 to install more than 1,000 bus shelters over two decades, but the agreement has unraveled, and many bus riders face a long, hot summer without protection from the elements.

The virtual collapse of the bus shelter program has major ramifications for city coffers as well: as much as $80 million in projected revenue that could have been generated through advertising on the shelters and other street furniture like kiosks has not materialized.

What was once considered an innovative system to pay for bus shelters has fallen apart, partially because the City Council denied or slowed the permitting of the structures when complaints arose about the visual blight of street advertising in the 2000s. 

Despite a highly critical audit of the program in 2012 bringing these issues to light, city officials have made little progress in following through with recommendations to fix the contract and allow installations of bus shelters to move forward.

A woman uses an umbrella to stay out of the sun at a bus stop with no shelter on San Fernando Road in Pacoima.
Meghan McCarty/KPCC
A woman uses an umbrella to stay out of the sun at a bus stop with no shelter on San Fernando Road in Pacoima.

How it doesn't work

Bus rider Steve Santana knows the tricks of finding shade where there is none. At a bus stop in Pacoima on an especially hot San Fernando Valley morning recently, some people milled on the sidewalk but a line of about eight deep squeezed into a shady alley between two buildings near the stop.

"It's the sweat. You just feel nasty and unmotivated to work or do anything," Santana said as the sun beat down. "It kind of kills your day sometimes."

Of the nearly 8,000 bus stops in Los Angeles, about 6,200 of them lack shelters. If the bus shelter contract had been executed as intended, at least 662 more shelters would have been built by now.

To understand how things unraveled, return to the year 2001 when the city first reached agreement with CBS Decaux, a joint advertising venture of the Paris-based JCDecaux SA and CBS Outdoor Americas Inc., a one-time division of CBS renamed Outdoor Media.

The deal was an attempt by the city to install more shelters without having to come up itself with the needed construction funds. The business model was one that many cities adopted in the 1970s and 1980s. To pay for the bus shelters, municipalities partnered with a private company that agreed to install the structures in exchange for the right to sell advertising on them while sharing the revenue with the local governments.

But it was not a perfect system. 

Brian Taylor, a professor of urban planning and director of the UCLA Institute of Transportation Studies, has researched how competing interests have influenced where bus shelters have and have not gone up in Los Angeles over the years. 

"There is this conflict between the goals of the transit system, the goals of the city managing the sidewalks and the goals of the advertising company, and all those goals are not aligned," he said.

Bus riders and transit agencies want the shelters where they are most needed, often at busy bus stops in low-income communities where bus ridership is high. But advertising ventures like CBS Decaux have other priorities.

"The advertising company may be interested in putting their shelters on high-traffic streets where there are relatively few people waiting for buses," Taylor said. That's because crowded bus stops block the views of the ads and may not be located in neighborhoods where the displays sell for higher amounts.

In his 2001 study, Taylor found in the 1980s and 1990s, the interests of advertisers carried more weight, resulting in the disproportionate location of shelters in higher-income areas with low bus ridership.

The study offered Los Angeles officials several recommendations on how to more effectively distribute the shelters. Taylor suggested the city be given more control over where to place the shelters to better serve bus riders, even if it meant less ad revenue.

Then, to offset the lost dollars, he recommended the city sell more freestanding ads in other areas more desirable to advertisers, such as in central business districts with attractions like shopping centers and movie theaters.

When the city developed a new contract with CBS Decaux in 2001, officials incorporated many of Taylor's ideas into the deal, but it didn't take long for the agreement to break down.

"This is probably a case study of what not to do from both sides," said Wendy Greuel, the former city controller who in 2012 issued a sharply critical audit of the bus shelters program.

She found the process of approving permits to build the shelters had stalled during the early years of the contract, preventing the city from collecting more than $23 million in projected ad revenue at the time of the audit and potentially $57 million more over the life of the contract.

The delays came during a period of public backlash against billboards when advertising on the streets had become highly unpopular. The City Council was slow to approve some permits, and because the whole web of advertising kiosks and bus shelter construction interconnected, the rollout schedule for new shelters collapsed.

Greuel made several recommendations in her audit. But four years since they were issued, many still haven't been completely adopted. Most importantly, she had urged the CBS Decaux contract and the rollout schedule for construction be renegotiated. 

Since the audit, only seven shelters have been installed, bringing the total to 621, despite the fact the city has issued permits for 829 other locations. An executive with JCDecaux, one half of the CBS Decaux venture, told KPCC his company is not to blame for the delay in new shelters.

"The intent was, when we got all the permits, we were supposed to get some kind of revised agreement," said J. Francois Nion, a company representative.

City officials would not comment on the current details of the contract renegotiation, citing the ongoing talks as the legal basis for withholding the information. Department of Public Works spokeswoman Elena Stern issued this statement:

"There are ongoing discussions about the contract between the City and CBS Decaux that may result in changes to the contract if both parties agree," the statement reads.

The last time the Bureau of Street Services formally updated the city controller's office on the progress of the audit recommendations was in June 2014.

In correspondence about the contract, officials noted they have been trying to renegotiate the agreement since 2003 but have been unable to reach a deal — and may not be able to do so within the remaining term of the contract that ends in 2021.

A bus stop on San Fernando Road in Pacoima, Los Angeles.
Meghan McCarty/KPCC
A bus stop on San Fernando Road in Pacoima, Los Angeles.

No shelter, fewer riders

Yvette Lopez-Ledesma, a community organizer with Pacoima Beautiful, an environmental justice advocacy group serving the northeast San Fernando Valley, has been working for more shelters in her community for years.

Pacoima is a mostly Latino, working-class neighborhood that depends heavily on public transit. On a hot April day, she walked the neighborhood with KPCC pointing to crowded bus stops with little or no shade from nearby trees or buildings, and no bus shelters.

"There you see another one. There's no shelter and the sun is on there all day," she said.

Lopez-Ledesma has all but given up on the current bus shelter program, but she hopes when the city comes up with a new contract in 2021, officials will invite bus riders and community groups like hers to hear about the needs of transit users at bus stops.

She believes it would benefit the city in the long run.

"If we all found the transit experience more comfortable, we might get out of our cars," she said.

L.A. City Councilman Mike Bonin wants to hear more feedback from bus riders. As chair of the council's transportation committee and a member of the Metro board, he's been a major supporter of efforts to increase transit ridership, along the lines of the city's long-range transportation blueprint,  Mobility Plan 2035.

"A big part of doing that is having bus shelters that allow people to stay out of the rain or sun," he said. "We need to be doing a lot more to make them better."

Research from Taylor, the UCLA transit expert, backs that up. He said transit users find waiting time much more onerous than the time spent on buses, and it looms much larger in their perceptions of transit.

"It makes a lot of sense to try to make the time spent waiting as comfortable, as safe and as certain as possible," he said. In addition to shelters, Taylor suggests features like accurate real-time arrival information, nearby bathrooms and Wi-Fi can go a long way in reducing the burden of waiting for bus riders.

Declining ridership on buses is a looming issue with dire implications for Metro, which saw its average weekday boardings drop by 9 percent in the second quarter between fiscal year 2014 and 2016, according to a report issued in January. 

Bonin has pledged to get to the bottom of the logjam in the current bus shelter contract, but he said he also hopes that future efforts to build shelters will not rely on funding from advertising.

He suggested the city could seek funds from sources like California's cap and trade market and give more power to Metro, the county transit agency, to control the shelters.

According to Taylor's research, granting the transit agency more say over bus shelters can improve their effectiveness. That's what San Francisco does.

San Francisco's roughly 1,200 shelters are administered by the San Francisco Municipal Transportation Authority and funded by advertisements, in some cases not placed directly on the bus shelter. So advertising can be placed on kiosks in high traffic areas, for example, and ads aren't blocked by bus riders using the shelters.

Following San Francisco's model would no doubt be more complicated in Los Angeles, where the city and transit agency jurisdictions are not the same. There are 88 cities and more than 20 smaller transit agencies in Los Angeles County.

But for Lopez-Ledesma, the Pacoima community advocate, bus shelters are not a minor matter.

"This is a huge issue," she said. "It's about people, and really trying to get dignified places for people to wait for their mode of transportation." 

We'd like to hear from you: tweet photos of your least favorite bus stop with the hashtag #SeekingShade or post them on Facebook, and tell us your experiences waiting without bus shelters in the comments section below. Checkout what other readers and listeners are saying here.