American mass transit has a problem – ridership is declining, and even the places which grew up around the railroads, broadly speaking, refuse to upzone, even around transit. Transit agencies, long cognizant of this problem, have sought to resolve it through a variety of “first- and last-mile” options. Though this could take many forms – carpooling, bikes, dockless scooters, etc. – this generally refers to shuttle services from a transit station to a farther-afield employment or activity center. This is not new, and many systems already feature examples.

Done right, last-mile service can make transit more efficient, because routes do not have to distend themselves between Point A and B if Point C can be reached with a transfer. However, one wonders if there would be more of these services if bus transportation were provided by the free market. Indeed, where private bus service is allowed or, at least, tolerated, networks have tended to form organically.

Most transportation scholars are aware of the networks of “dollar vans” and “jitneys” in Metro New York City. These systems emerged organically, serving largely immigrant communities in Queens, Brooklyn, and New Jersey’s Hudson County, and both compete with and complement the city’s subway and bus system. While New Jersey’s regulatory environment is somewhat friendlier, with the bridge and tunnel services benefiting from being under comprehensive federal regulations thanks to their interstate character, jitneys in the outer boroughs operate on the “grey market,” of dubious legality. It is likely the case that demand in these neighborhoods is so intense that regulators cannot suppress it. While it should be noted that some of the services in North Jersey have been occasionally fraught with serious safety concerns, enforcement of safety regulations, rather than a blanket ban, is the answer; additionally, establishing requirements for leased curb space would both increase safety, through less cutthroat bidding for pickups, while benefiting operators.

If regulations on local bus service were limited to reasonable safety, consumer protection, and accessibility restrictions, it is possible that such “last-mile” services could more easily emerge organically. This would particularly be the case if cities spent at least a portion of limited transit revenue on demand-side subsidies and agreed to price roads correctly. In reality, operators who wish to operate their own services must more often than not navigate complex and obstructive regulatory policies, even in the most transit-reliant cities. Changing these policies would go a long way towards innovating local bus service, providing the potential for a variety of feeder options, just as limited legalization of ride-hail services allowed Uber and Lyft to thrive.

To be sure, this option will not solve the problem in every city – some routes just wouldn’t be profitable. But rather than strain budgets, why not allow the private sector to explore last-mile connections? Under such an arrangement, transit agencies could focus on high-demand routes, while allowing for entrepreneurs to operate connecting shuttles. The answer for agencies, broadly speaking, is to work with, not against, innovative providers.

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