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I wouldn't necessarily see public transit as a waste of resources, even if it's in a smaller, auto-friendly city. Whether or not the creme de la creme of town use it, it's an important option for those who can't afford the costs of insuring, fueling and maintaining a car, can't drive for health reasons, or choose not to. After all, even smaller cities close to national forests and reserves still have city parks, and don't consider them to be a wasted resource.
If anything, a reliable transit system is a sound investment to make for the day when that smaller city won't be as small (unless it's stagnant or shrinking). When the city expands, it'll be much more cost effective to purchase a few more buses (especially when fed and state funding is available to cover most of the cost) and expand the service coverage and hours than to plot out a new network of highways and parking garages.
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