Sic Transit Transbus

Uncle Sam builds the bus of the future-a $28 million fiasco.


Strung out along the back fence of a dusty trucking-company storage yard in Phoenix are four freakish-looking buses, the ruins of a costly government dream that didn't come true. With a fifth prototype now stored on a snowy parking lot in a small town in Ohio, they are all that remains of a nine-year attempt by the US Department of Transportation to reshape the entire face of that pedestrian part of the American lifestyle, taking the bus.

Contemplated from Washington, from where such things frequently are contemplated, the bus hulks in Arizona and Ohio have inspired such unflattering descriptive appellations as "failure," "foolish," and "fiasco." The rotting, futuristic buses teach how some government programs turn out in the real world.

As government mistakes go, the cost of Transbus—the official name for the program that built the buses as prototypes in 1972—is not great, $28 million. Compared with the B-1 bomber, the C5A transport plane, and even a computerized people mover in West Virginia on which the Transportation Department blew $125 million, that's not a lot of money. "Peanuts," in fact, was the way former Transportation Secretary Brock Adams described the cost in comparison to other government fiascos.

But the implications of the Transbus failure are more serious. They illustrate, according to Rep. Norman Mineta (D-Calif.), chairman of a House subcommittee that held little-publicized hearings on Transbus last year, "how the government should not deal with new technology."

For the first four years of the Transbus program's life, the Urban Mass Transportation Administration, an arm of the Transportation Department, told bus lines and manufacturers that they soon would not be allowed to use and build anything but Transbus. Then in 1975, while the prototypes were still being tested, one of the 13 different people who ran UMTA during the Transbus years changed his mind. And that decision in 1975 killed the program—only no one bothered to recognize it until 1979. Despite the mortal wound, Transbus continued for four more years, bleeding money.

There is no scandal here and not, apparently, even a single crime. Said one congressional investigator: "I don't think there was any fraud. There were no hints of anything improper at any level."

It is a murky, convoluted tale. It unveils not a felony, but the system.


It all started with a 1968 report by the National Academy of Engineering. Build a more reliable, faster, easier-to-board, cosmetically attractive bus, the report urged, to lure people from their cars. The message appealed to the Department of Transportation. In 1971 the agency awarded a $28-million contract to Booz, Allen Applied Research, a respected consulting firm in Bethesda, Maryland. The objective: Start from scratch and design an entirely new bus, one that would catch the eye and draw passengers but at the same time use less fuel and be easier to maintain.

It was the first time the federal government had gotten into the bus-designing business. Before Transbus, the tiny industry—fewer than 6,000 vehicles sold a year—that builds the nation's buses had developed and marketed its own models just like cars.

Because UMTA pays 80 percent of the cost of new buses for the nation's public-transit agencies, the government can set whatever bus-buying policy it wants. The time seemed right to develop a workable bus design, then require manufacturers to make it and transit lines to use it, minimizing costs and easing maintenance through more standardized parts.

From the beginning, General Motors, the nation's biggest builder, was wary. Already at work on its own new bus model, GM nonetheless accepted an $8-million contract to build three of nine prototypes of the Transbus. Two other bus makers, American Motors and Flxible, got identical contracts.

Each company would develop its own design, then Booz, Allen would test all three, drawing up composite specifications for the new bus to include the best features of each. Floors would be lower—22 inches instead of 34—to make it easier to get on and off. Doors would be wider to speed boarding.

No sooner were the prototypes in the building stage than Congress passed the Rehabilitation Act of 1973, requiring that handicapped persons have full access to public transit. In one move, the objective of Transbus was changed. Instead of being a new, fast, durable, maintainable vehicle, Transbus was now primarily to be something everyone could ride. Each bus would have a ramp or hydraulic wheelchair lift. But the objective proved elusive. A reliable wheelchair lift was not available.

GM, Flxible, and American Motors continued work, however. By late 1974, the three companies had delivered their prototypes. They looked markedly different. Flxible's had 12 wheels and the silhouette of a shoebox. The other two models had three axles. GM threw in a radical new turbine engine.

Booz, Allen hired subcontractors in Phoenix and Buffalo to run extensive tests on the nine prototypes. Three of them would be deliberately crashed. Meanwhile, Booz, Allen had hatched a plan. The company and the American Public Transit Association urged the government to build a test fleet of from 100 to 600 Transbuses after the prototypes were evaluated.


Up to this point, there had been four secretaries and acting secretaries of Transportation and four administrators and acting administrators of UMTA. As each new cabinet officer or bureaucrat came and went, Transbus was altered.

Then in January 1975, with the prototypes less than halfway through their testing, UMTA administrator Frank C. Herringer made a startling announcement. Herringer said he wanted to start requiring the purchase of Transbus and only Transbus in the near future. But in the meantime, he said, if any manufacturer was foolish enough to go ahead with a new model, knowing that the government would not allow use of federal funds to pay for it for more than a few months, UMTA would pay the bills anyway during the interim.

Herringer, now a vice president of Transamerica Corp. in San Francisco, said in a recent interview that he figured his announcement would scuttle GM's plans for a new model to preempt Transbus. Herringer now recalls—and aides involved in his deliberations at the time agree—that he was "flabbergasted" when, within three months, GM announced it was introducing its new bus anyway.

"It just seemed like such a dumb decision," Herringer recalled. "They [GM] were pretty arrogant. They may have felt that if they went ahead and made the investment [in tooling and engineering for the new bus, called the RTS-2] that they could come back and put pressure on the federal government and run that bluff."

GM proved to be dumb like a fox.


Herringer vowed to be uncompromising with GM. There was one problem. The month GM announced its decision, the Transportation Department got a new secretary, William Coleman. And three months later, Herringer quit to take over as head of San Francisco's Bay Area Rapid Transit District.

The door at UMTA revolved twice more, and in came acting administrator Judith Connor and, two months later, new administrator Robert Patricelli. Patricelli had a different vision of the program. He was inclined to let GM go ahead and sell the RTS-2. By then, Flxible had gotten the message and was well along in development of its new bus, called the 870. Both vehicles became known as Advanced Design Buses, or ADBs in transit lingo.

Patricelli, in fact, encouraged GM to go ahead with its new bus, according to UMTA insiders, House investigators, and GM executives themselves. "It was the marketplace," said Edward R. Stokel, GM's director of public transportation and coach sales. "As far as they were concerned, our bus was the same old girl with a different kimono on her. Bus companies were telling us to come out with a new bus. We had to listen to them."

GM also had made its own review of the Transbus program. It saw a program in trouble, its future clouded by Herringer's decision and years of indecision that led up to it. Despite knowing the RTS-2 might not break into black ink for six years, Stokel said, GM concluded that bringing out the new model would not be a significant risk. Transbus, the automotive giant concluded, was doomed.

GM's decision produced quick allegations that it had improper access to internal government decisions before they were publicly announced. Patricelli said things were so confused in the Transbus program at the time that there was nothing for GM to have learned. "There was no leak. There was nothing to know," he said. "There had, when GM made that move, not been any decision not to mandate Transbus."

GM, according to House investigators who looked for hanky-panky and found none, merely made a corporate and entirely legal judgment. "They knew they were GM and they thought they could force the market," said one investigator. "They could. They took the risk. It's as simple as that."


While all this was going on, meanwhile, Coleman, the new Transportation secretary, went to Miami, where some of the Transbus prototypes were being tested in limited street service. "Transbus was advertised to me as a bus that would provide transit for the handicapped," recalled Coleman, now a lawyer in practice in Washington. "But when I looked at it, you could only get one wheelchair on each bus, and the lift didn't work. So I said to Herringer, 'How in the hell can you say you're solving the problem of the handicapped?' What I saw didn't do it."

While officials in Washington were taking conflicting actions regarding the future of Transbus, Booz, Allen was watching from a polite distance. The rakish buses were being evaluated in Phoenix and Buffalo and put through their paces in test service in four cities. In Phoenix, at a sophisticated test track operated by a consulting company called Dynamic Sciences, Inc., technicians measured such arcane variables as "jerk," a measure of the smoothness of acceleration, and "dwell time," or the lapsed time required for the bus to stop, load passengers, and start again.

The prototypes were doing well, according to Ronald Ross, Booz, Allen's project director for Transbus, but on the morning of May 13, 1975, the project suffered a setback. This account is based on a 1975 report by Booz, Allen:

Temperatures topped 90, and Booz, Allen decided the weather was favorable for a punishing test of the engine and transmission of one of the Flxible prototypes. Loaded down with 160-pound sandbags—to simulate the weight of passengers—and with engine-temperature monitors hooked up, the unescorted bus was taken by two technicians onto an isolated stretch of Interstate 17, 30 miles north of Phoenix.

Just after noon, at the crest of a steep hill, mechanic Gary Loring, behind the wheel, noticed that the coach started to decelerate rapidly. A popping noise was heard through the firewall. Cautiously, Loring looked in his rearview mirror. Smoke was billowing from the engine compartment. Loring steered for the shoulder. Unable to open the Transbus's radically designed hood, Loring emptied four fire extinguishers onto what he could see of the fire, then had to back away because the flames were spreading.

Within nine minutes, the fire—raging out of control—was burning into the passenger compartment, sucked through air conditioning ducts and around key components. The acrylic windows began to melt. Seat cushions burned, spewing noxious gases.

Twenty-seven minutes after the fire started, the entire $2.5-million bus was in flames. Without an escort vehicle or access to a telephone, the two men could do nothing but stand on the shoulder and watch it burn. Less than 40 minutes later, there was nothing left.

Though a full load of passengers could have been evacuated before the fire spread out of the engine compartment, the fire shook the Booz, Allen staff. Clearly, the Flxible prototype had serious design problems.

"It was an unfortunate mistake, but not a tragedy," recalled Ronald Ross, Booz, Allen's project director. "We learned from it. It was valuable information."


Back in Washington, it was business as usual. Plans for the 600-Transbus test fleet were quietly scrapped.

In 1976 Patricelli effectively decided to kill Transbus for good. In July of that year he issued a policy order that said, in effect, that the GM and Flxible advanced design buses would be good enough, even if they weren't Transbus. Furthermore, Patricelli said, the low Transbus floor (it was then back at 22 inches) was impractical. After February 1977, Patricelli announced, UMTA would require that new buses bought with its money meet the existing specifications for the new GMs and Flxibles. But a month before the requirement would have gone into effect, Patricelli quit.

President Carter had taken office. Coleman succeeded Patricelli as DOT Secretary, then was replaced by Brock Adams, a five-term congressman from Washington state. And after two acting administrators had warmed the UMTA chair for a total of eight months, administrator Richard Page took office.

Adams had a very different idea. He un-killed Transbus and lowered the floor again. "When I got there, you've got the prototypes out there and nobody is satisfied with them," said Adams, now an attorney in practice in Washington D.C., and Seattle.

Shortly after he took office, Adams went with Carter and then HEW Secretary Joseph A. Califano to a meeting of handicapped groups, all of which were pressing for a fully accessible bus line. Transbus, Adams recalled, seemed to be the objective of the handicapped. "I mean, people chained themselves to Joe Califano's house for days over the thing," Adams recalled.

Meanwhile, though the Transbus program was degenerating into hopeless confusion, Adams served notice in 1978 that after September 1979 only vehicles meeting the Transbus specifications would be eligible for federal funds. Taking the government at its word, a consortium of transit systems in Los Angeles (the Southern California Rapid Transit District), Miami, and Philadelphia advertised for bids for 530 Transbuses in January 1979.

A bid-opening was scheduled for May, but when the date arrived, there were no bids to be opened. American Motors had quit the bus business and GM and Flxible, citing an elaborate series of technical problems, refused to bid. "We held the party and nobody came," said Adams. "That's what happened.…That was their business! We had paid them [the manufacturers] a number of million dollars to develop a prototype and they spend damn near 10 years on it and they said they couldn't build it. At that point, I pulled in the scientific people and told them to tell me what's wrong."

The Department of Transportation hired the Mitre Corporation, a consultant in McLean, Virginia, to study the Transbus fiasco. But one study wasn't enough for Adams. So he commissioned the National Research Council, an organ of the National Academy of Sciences, to make a study of the study made by Mitre.

But before the study and the study of the study could be completed, Adams himself got into hot water with President Carter because he refused to fill out "report cards" demanded on key department officials during a White House shakeup of the cabinet. Adams was canned for his insubordination in July 1979.

After two short-lived acting secretaries, Neil Goldschmidt took office. He made it clear he didn't care about Transbus. To make matters even more confusing, UMTA administrator Page had quit at about the time of the no-bid opening for Transbus, leaving UMTA in the hands of two acting administrators until Theodore Lutz took office in December 1979.


It was during May of 1979 that the House Committee on Public Works and Transportation held hearings to try to sort out what had happened. When a subcommittee set out to conduct hearings, it asked for testimony from Gary Gayton, UMTA acting administrator for about 10 days.

One of the subcommittee members asked Gayton to comment on the best way to make public transit accessible for the handicapped. The question drew this response from the government's official representative: "I have only been with UMTA about a week and a half at this point. I am reviewing a lot of memos and trying to get up-to-date on many of the technical issues. I don't think at this particular time, sir, I can fully answer that question."

The hearing was attended by an exasperated trio of transit agency administrators—Jack Gilstrap of Southern California's RTD, Peter V. Young of Philadelphia, and Ernest R. Gerlach of Miami. Gerlach was on the stand when a committee member asked what the transit agencies actually wanted. Replied Gerlach: "We need the bus equivalent of the cowhand's quarter horse that will serve him well for many years, not a Spectacular Bid that will, under tender loving care, perform outstandingly well in selected races for a few years before retiring."

Elsewhere in Washington, the Transbus study and the study of the study were nearing completion. And the inevitable had occurred. The Transportation Department announced that, in the face of a dearth of manufacturers, it was indefinitely delaying the deadline for buying Transbus. GM and Flxible still had the market cornered with their $145,000 ADBs.

First Mitre Corporation, and then the National Research Council concluded that, despite scathing criticism of GM and Flxible at the House hearings and among transit lines and government agencies, the decision not to bid represented "reasonable and understandable business judgments." There was a split, however, on whether from a technical standpoint, in the aftermath of the $28 million department development program, Transbus could be built at all. Mitre said it could. The National Research Council said it could not.


In the Congressional Budget Office, still another study was under way. In November 1979, it brought the Transbus concept full circle.

The budget office report dealt with a question never fully studied by the Transbus program, though the entire concept depended on it: Is a fully accessible bus what handicapped people really need? The budget office concluded that even equipping every bus with a wheelchair lift would eventually serve not more than seven percent of all severely disabled persons. And providing the service—taking into account the costs of lifts and maintenance—would be a staggering $38 per trip.

Providing special taxi or van service, the budget office concluded, would make transportation available to 26 percent of the handicapped at a cost of $7.62 per trip. Even buying wheelchair-bound persons private automobiles equipped with special controls would make transportation available to 316,000 more persons than Transbus and cost $477 million less in the long run.

There had been hints at the conclusions as early as the May hearings. The RTD's Gilstrap, for instance, testified that there are 6,000 transportation programs for the handicapped in the Los Angeles area but that they are not coordinated and there is no organized plan to work with the local bus system. GM's Stokel testified that 16 lift-equipped buses in Detroit, handled an average of a total of only 2.4 passengers per day. Six lift-equipped buses in Fayetteville, North Carolina, had been in service 18 months, but they had carried only one wheelchair passenger among them in the entire period.

"We had one heck of a program. But unfortunately, none of us really stay in government long enough." Drawing the conclusion was Carlos C. Villarreal, UMTA administrator from April 1969 through February 1973. By staying just under four years, Villarreal set a longevity record for time in office by an UMTA chief concerned with Transbus. He now works for a Washington consulting firm.

Representative Mineta, chairman of the House Transbus subcommittee, agreed. "This was a bad example of federal inconsistency," he said. Mineta and members of the subcommittee said they see in Transbus a lesson that government ought to learn but isn't likely to. Former Transportation Secretary Adams called Transbus ill-conceived from the beginning but said he had no choice but to try to salvage what he could when he got into office.

There remains the haunting possibility that all the government got for $28 million is five rotting prototypes in Phoenix and outside a Flxible factory in Loudonville, Ohio. The other four were burned or destroyed.

Booz, Allen's Ronald Ross wishes the Transbus dream or nightmare—whichever it is—could end. He wants the prototypes destroyed. "To me, it's like displaying a dead body too long," he said. "There's no purpose to it any more. The purpose is over, and why people hang onto them, I'm not too sure."

Allan Parachini is a staff writer for the Los Angeles Times. This article is adapted from one that appeared in the Los Angeles Times. Copyright © 1980 by the Los Angeles Times. Reprinted by permission.