Free transit attracts riders and helps communities in more ways than one

In January, Missoula, Montana’s transit agency, Mountain Line, began a three-year, “zero-fare” demonstration project on its fixed-route and door-to-door services, meaning boarding passengers no longer pay to use the bus.

Implementing a zero-fare system was part of a larger transit improvement package that includes late-night service on its four most popular routes, increased frequency on key routes, and more door-to-door service to help senior and disabled residents.

The demonstration project costs $460,000 per year to operate. The University of Montana and the city are its biggest funders, annually contributing $205,000 and $100,000 respectively. The balance is made up of 12 other community partners, including Missoula County, the metropolitan planning organization, hospitals and medical centers, public schools, the department for aging, downtown and parking associations, a shopping mall, and an affordable-housing provider.

According to a 2012 Transportation Research Board (TRB) report, Missoula is one of more than 35 communities in the United States that have implemented fare-free public transit systems. Mountain Line cites its inspiration as Corvallis, Oregon, where the Corvallis Transit System ridership grew by 37.9 percent in its first year of fare-less operation.

Mountain Line is aiming a bit higher. It serves just under one million bus riders each year and hopes to grow its ridership by 45 percent within three years. This would be an annual ridership increase of 400,000 or 1.4 million riders by the end of three years.

According to Bill Pfeiffer, Mountain Line’s community outreach coordinator, “In June 2015, just our 6th month of zero-fare service, we gave 50 percent more rides than in June of 2014. Before this February, Mountain Line had never broken the 100,000 ride barrier. We’ve broken 100,000 rides every month since, setting ridership records in every month of 2015. As of July 31st, overall ridership has already increased 26 percent from the previous year, and for the first time ever, our ridership increased during the summer months.”

MountainLineRidershipMthly Graph

Overall, throughout the country, zero-fare systems have resulted in many benefits, including:

  • Lower administrative costs: The costs associated with charging and collecting fares, like acquiring fare boxes, issuing various tickets (transfer passes and monthly passes, for example) and enforcing the payment of fares.
  • Savings in travel time: With no fares to collect, passengers can board more quickly. Less time spent at the stops (known in planning lingo as “dwell time”), in turn, helps reduce travel time.
  • Fuller buses: As current customers ride more often, ridership in the off-peak hours increases.
  • Improved quality of life: Reductions in traffic yield less pollution and congestion, improving overall health and quality of life.
  • Enhanced community pride: More than just an amenity, having fare-free transit service is a source of community pride. It has even helped communities earn recognition, like state and national awards as “best places to live.” Missoula Mayor John Engen called the fare-free service “a feather in the community’s cap.”
  • Modal shift: Up to 30 percent of the additional trips generated from operating with no fares come from people switching from other motorized modes. This is really significant because in my experience, transportation planners seem to always be talking about attracting “choice riders,” that is, riders who can afford to drive but choose to use other modes like transit. Typical suggestions center around providing nicer buses or more amenities at transit stops, but I’ve never heard anyone suggest offering reduced fares, let alone free ones. Isn’t it ironic that the way to entice those who have money to use transit is to offer them free service?
  • Transit equity: By removing the fare requirement, transit service becomes accessible to everyone, regardless of income. I have heard of transit systems providing reduced fares for their low-income residents. To qualify, a person must submit documentation to prove their income falls below the stated threshold and must provide verification of income periodically to remain eligible for the subsidy. Just think about the bureaucracy this generates and the humiliation for the recipient. A fare-free system disposes of all of this.
  • Improved transit image: According to Mountain Line, “When zero-fare community bus services are properly funded and maintained, the image of the buses changes from being the clunky transportation choice of last resort to the service that connects all elements of the community and provides equal opportunity to access all that a community offers.”
  • Increased productivity of public investment: With zero-fare, the funding per passenger drops significantly and the effectiveness and productivity of public investments in transit are enhanced.
  • Increased support from bus operators: Bus operators are reportedly very supportive of zero-fare policies in almost all locations where such service exists. Not having to collect and enforce fares frees them to answer passengers’ questions and focus on safe bus operation.

So with all these benefits, why don’t all transit agencies operate fare free? According to the TRB, fare-free public transit makes the most sense for systems in which the percentage of fare-box revenue-to-operating expenses is low.

Free Bus

Charleston, South Carolina launched a free bus service in 2013

The TRB found that the three types of communities most likely to adopt a fare-free policy are:

  • rural and small urban
  • university dominated, and
  • resort communities.

Although a small number of public transit systems in larger urban areas experimented with offering some version of fare-free service over the years (from Denver, Colorado in 1979 to San Francisco, California in 2008), finding a source of funds to replace their substantial fare-box revenues proved too difficult. In fact, as of 2012, no public transit system in the United States with more than 100 buses offered fare-free service.

So fare-free transit systems clearly work in communities of the right size and type. Given the numerous benefits, it seems worthwhile for larger communities to explore or revisit the possibilities for going fare free in whole or at least in part.

So, for example, a city may find that going fare-free during the off-peak hours effectively attracts ridership during that time, increasing the productivity of the service and perhaps drawing riders to the peak hours as well.

Similarly, a community may want to experiment with fare-free service for a limited time – like a month – as a way to attract more riders in the long run. May is National Bike Month, so why can’t another month be National Transit Month? That could be a period to give fare-free a try.

Being from the Northeast, I would nominate one of the winter months, when people may not want to deal with the hassles of driving in the cold and snow.

In what ways do you think zero-fare systems would help or hurt public transportation’s overall good to society?

Photos and graphic courtesy of Mountain Line and North Charleston.

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18 Comments or Mentions

17 Comment(s)

Kelly Glenn

This is an exciting trend. In addition to obvious benefits for low-income riders, it is one of the few improvements that I think will attract car owners. Since car owners pay most of the costs of owning a car – the payments, insurance and maintenance – regardless of how many miles they drive, there is little incentive to pay for a short bus ride when most of the costs of driving are already paid. Fare-free trials could also serve to break down mental barriers for people who have never tried the bus, or who never carry cash.

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Monique Wahba

Excellent points, Kelly. I hadn’t thought of fare-free transit attracting car owners that way as I focus on the variable expenses of car ownership like payments at the pump! Good point also about those who never carry cash. With ATM fees so high, I know I tend to use credit over cash.

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Kelly Glenn

Also, did you mean to say University of Montana was one of its biggest supporters, rather than U of Missoula?

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Paul Mackie

Yes. Thanks for catching that, Kelly. It’s fixed.

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Richard Masoner

The 2008 free fare experiment in the San Francisco Bay Area (covered the entire region, not just San Francisco) wasn’t really a funding issue — if we want free fares, we’ll find the funding for it. The main problem were probably complaints from regular riders, and a poor experience for the newbies who all crammed onto already overcrowded trains, buses and ferries when our regional transportation agency declared a free fare day.

Given your interest in transportation equity, another possible solution is something like a Transit Assistance Program for low-income residents and the homeless.

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Greg Strandberg

I live in Missoula. We’ve had property taxes raise every year for years. The County is raising taxes, the schools are raising taxes. People are fed up.

It’s clear that the administrative costs of taking fares will go down when you stop taking money.

The City of Missoula does not have $100,000 a year for this, nor do its taxpayers. We’re involved with a costly water lawsuit that will cause additional tax hikes.

There’s no such thing as a free ride – someone always pays.

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John Jones

Having managed one of the free services in a Colorado resort county, I can tell you that the shine will wear off this penny quickly. When it does, the funding issues will start, and when ridership drops off, what then?
Over time, riders tend to treat it like what they perceive they pay for it…nothing.

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Monique Wahba

Yes, a transit system can’t just declare a fare free day without planning for the added demand. A sure fire recipe for failure. While a transit assistance program definitely has merit, I’m sensitive to the paperwork entailed to run such a program, and more importantly, the humility of the transit rider.

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Monique Wahba

Greg – Glad you bring up the financial impact of the program. Perhaps I’ll explore how such fare free programs are funded in another article. For now, I’d like to point out that Corvallis funds its fare free service from a Transit Operations Fee (TOF) collected from its utility customers indexed to the average price of regular grade gasoline. This is said to provide stable funding to match its federal and state funds. Read about it at: http://www.corvallisoregon.gov/index.aspx?page=846

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Patty Hue

Greg Strandburg is always complaining about how he’s being taxed to death in Missoula. The $100,000 that the City is contributing to this reaps probably ten times as much in savings in terms of congestion, and just puts more money in the pockets of locals who don’t have much to begin with. Zero fare if done right, can be a huge benefit to those of us who are struggling to make ends meet, can’t afford a car, but still need to get around town for work, errands, appointments, etc. It has made a big difference.

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Monique Wahba

Glad to hear fare free transit is making a positive difference. Thanks.

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Zvi Leve

It is really important to recognize that ‘free transit’ is only appropriate at limited scales as indicated in the TRB report cited in this article. All transportation infrastructure costs money, and the adage ‘you get what you pay for’ certainly holds true for public transit too. The point that there are costs associated with fare collection is a very good one, but gradually we are moving toward ‘smart technologies’ which may permit small transit operators to ‘outsource’ their fare collection services to third-parties. Will be interesting to follow those trends in the future. Another side benefit of fare collection is that it can provide precious data about demand, but once again this requires the resources to be able to make use of that information.

In order for public transit to be a viable option for ‘discretionary travellers’ it must be reliable and have good system coverage. This costs money and also requires continuously looking after your clients needs. If there is no financial incentive to providing transit services, it will be run like any other non-responsive bureaucracy, and that is the exact opposite of what we need to convince people to get out of their cars.

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Monique Wahba

Outsourcing is interesting. I wonder how significant an impact it will have on fare collection. As I mentioned in the article, Missoula didn’t decide one day to go transit free. After careful planning, the transit agency timed going transit free with a number of improvements to its service. And as you point out Zvi, a transit agency cannot become complacent when ridership goes up.

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Zvi Leve

A few people above mentioned providing discounts (or free) fares for certain classes of riders. This does not necessarily need to be a very bureaucratic procedure although most transit agencies do excel in creating needlessly complicated procedures. The idea of offering something for free might encourage a new kind of thinking about the ‘return on administrative investment’. I think that anyone who receives some form of social assistance should automatically qualify for reduced fare status. In Montreal, all students get a 50% discount on transit fares, and one can claim student status up to the age of 25 (ie through graduate school).

Another option would be providing some form of transit or transportation credit on income tax. Undoubtedly government bureaucrats would want to see receipts, but is that really necessary? Why not just offer anyone with an annual income less than X dollars some form of ‘transportation credit’ to help them cover costs? And if someone does not own a car, this credit could be made even higher!

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Monique Wahba

I still advocate for free to all. If that isn’t possible…I like the idea of somehow automating reductions for those on social assistance. As to tax credits, what I’ve seen in our lower income communities is that a number of people do not file taxes and that it often takes some kind of education and outreach campaign to reach folks, inform them of the benefit of filing (like the earned income tax credit) and provide the assistance for them to do so. So much for simple!

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Teri Sheets

Has anyone researched the ADA complementary paratransit service implications of providing fare-free fixed route transit? Because the ADA rules require that the fare for ADA paratransit service be no greater than twice the base fare for fixed route service, twice a zero fare would be zero. How would local entities cope with what would be a huge latent demand for demand-response ADA service? And how would they even begin the cover the additional cost to provide the service given that demand-response trips are much more expensive to provide? If these questions could be answered, then perhaps more entities would be able to consider fare-free transit as a viable option.

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Monique Wahba

Mountain Line’s fare free transit applies to door-to-door service as well. How they do it is a very good question.

Reply

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