(The Center Square) – Transit agencies across the country have waived fares in an effort to boost sagging ridership that hasn’t been able to rebound since the COVID-19 pandemic. Taxpayers are picking up more of the costs as a result.
In 2020, the Kansas City City Council in Missouri voted unanimously to eliminate fares for riders to promote “transportation equity” within the region.
The city collected $11.1 million in fares and directly generated revenue in 2019. Federal money for operating expenses were $14 million. By 2021, fares and directly generated revenue dropped to $2.2 million and federal assistance nearly doubled to $27.3 million.
While passengers are getting a free ride, the municipalities that pay for it with taxes have said the cost is too steep.
The city of Gladstone canceled its contract with the Kansas City Area Transportation Authority when its contract-for-service was set to increase from $86,132 in fiscal year 2023 to $339,256 in fiscal year 2024, an increase of nearly 400%.
Instead, the city will go with a new app-based on-demand service with the Kansas City Area Transportation Authority that will charge fares ranging from $3 to $10. There would be limited free fares for certain destinations.
In North Carolina, GoRaleigh suspended fares through June 2024. The transit agency that serves the Raleigh area said that the COVID-19 federal emergency packages have helped pay for the loss of fares. GoRaleigh transit brought in $6.3 million in fares in 2019 before the pandemic. GoRaleigh brought in $1.9 million in fares and directly-generated revenue in 2021. That’s a 70% decline in revenue. GoRaleigh received $3.9 million in federal money in 2020 and $6 million in federal funding in 2021.
In Tucson, Arizona, all transit rides are free in 2023. The city is negotiating with “potential regional partners” to make the free fares permanent.
Sun Tran, which serves the Tucson area, generated $14.9 million in fares and directly generated revenues in 2019, the year before the pandemic. That revenue dropped to $3.1 million in 2021. Federal pandemic relief has bailed out transit agencies across the country. In Tucson, federal aid increased from $7.5 million in 2019 to $37.1 million in 2021.
In Colorado, transit was free for riders throughout the state from June through August thanks to $28 million from a new state law.
Overall, total ridership in all forms of transit has stalled during the recovery of the COVID pandemic. Ridership reached 2.5 billion in the fourth quarter of 2019, according to a report from the American Public Transportation Association. It has bounced back to 1.7 billion as of the first quarter of 2023, or 66% of pre-pandemic levels.
Randal O’Toole, the Transportation Policy Center Director at the Independence Institute, said he has several objections to zero-fare transit.
“Just what makes transit so important that increasing ridership is a primary goal no matter what the cost to taxpayers?” O’Toole asked.
O’Toole said he had several issues with “zero-fare” transit.
He said 95% of the low-income workers pay for transit rides they rarely or never take which he called “socially unjust.”
“Fares represent the value that people place on transit,” O’Toole said in an email to The Center Square. “If the only way to get people to ride transit is to reduce fares to zero, that shows that people don’t really value it.”
O’Toole said transit agencies “are chasing tax dollars” to build more rail transit and other expensive infrastructure, most of which he said is oriented to downtowns.
“The reason for this is that they get such a small share of their revenues from transit riders so don’t really care about what riders need,” O’Toole said. “Reducing fares to zero only makes this problem worse.”
The American Public Transportation Association didn’t return an email seeking comment. The Colorado Association of Transit Agencies did not respond to an email seeking comment.