A fare-free TCAT?
Fiscal and operational challenges render a no-fare program unfeasible at this time
The question of whether TCAT should go fare-free and how that might be accomplished has been raised frequently by the public over the past several months.
While TCAT aplauds community members for their passion in trying to make local transit more accessible, too many roadblocks exist for the agency to implement a zero-fare program.
In 2022, the TCAT Board of Directors tasked its Planning Committee with addressing this question. This document and the supplemental material represents the report of the Committee.
Firstly, the question of whether TCAT should go fare-free is beyond the scope of the work of the Planning Committee. That decision would need to be made by the TCAT board, in consultation with TCAT staff and the TCAT underwriters. What this report attempts to do is to gather relevant information in one place, so that if the decision is made to implement a fare-free structure in the future, some of the ground work has already been done.
The most cited benefits of going fare-free include:
- Increased ridership, which has the effect of taking some cars off the road and potentially saving energy and reducing greenhouse gas emissions
- Equity, by increasing accessibility of low-income residents to transit
- Operational efficiency, by eliminating the costs associated with handling money, eliminating transfers, eliminating farebox maintenance, quicker boarding, etc.
However, TCAT in 2023 continues to experience severe constraints to its service. Decreased ridership and staff shortages and, to some extent, parts shortages are combining to make management of the TCAT system as difficult as it has ever been.
TCAT continues to uphold the Planning Committee’s earlier conclusion.
Some background
At the onset of the committee’s work on going fare-free, TCAT General Manager Scot Vanderpool laid out a set of criteria that would need to be met before we could begin going fare-free:
- The number of bus operators increases to 90 – 95
- Preventive maintenance services are maintained at 100% for a quarter of a year
- Addition of 2 additional qualified and trained mechanics
- Parts ordering becomes predictable
It was the the committee’s recommendation that the fare-free proposal, be re-examined by TCAT board and staff at such a time as the above criteria have been achieved. As of the second quarter of 2023, those conditions have not been achieved.
One decision that would need to be made before a fare-free system could be implemented is how the increased cost to TCAT would be funded. A rough, working estimate at this time is that an additional $1.5 million would be needed annually. There are many assumptions that go into this calculation.
It is unlikely that money to pay for the fare-free annual funding gap would come from a private donor. Therefore, one or all of the local underwriters would most likely have to fund some or all of this initiative. There has also been discussion of cultivating additional community partners to help fund TCAT, perhaps with something like bulk-fare agreements. Some large entities who could be approached include Ithaca College, the hospital, other large employers, and all the municipalities in the County. Sewing together this patchwork of funding would be a large undertaking.
A key piece of the financial picture is whether or not Cornell University would continue to contribute the equivalent of its current bulk fare payments – approximately $3.3 million at this time – if TCAT were to go fare-free. Despite repeated, direct requests to Cornell to comment on this, they have declined to do so.
Another decision that would need to be made is whether to attempt to transition to fare-free in stages, or to attempt to change all at once. TCAT has already gone fare-free for people aged 17 and younger. Other specific populations who could potentially go fare-free include seniors, low-income people, or people from a specific geographic area. Also, discussions have taken place for several years about the idea of a downtown circulator, which is usually envisioned as being fare-free.
An assumption is made that going fare-free will increase the number of riders on TCAT’s buses. We are currently estimating an increase of 20% to 30%, but that is really just a guess. It will be important if TCAT ever does go fare-free to monitor the actual change in ridership and to adjust the related calculations accordingly.
One of those related factors is the size of the fleet. Increased ridership would likely result in an increase in the size of the fleet necessary to meet the new, higher demand. In addition to an increase in the number of bus operators and mechanic-hours that a larger fleet would require, and to the price of additional buses and insurance and fuel and parts, there is the question of the size of the TCAT bus facility. The facility is currently crowded and does not have significant capacity to store more buses. TCAT has spent considerable resources in the past 7 years studying how to expand capacity, including building a new facility. No practical on-site solutions were found, and the cost of building a new facility is daunting ($50 million estimate in 2018). The size and capacity of the TCAT facility may be a limiting factor in going fare-free, and would need to be addressed before such a system could be initiated.
STOA – State Aid Operating Assistance from NYS – requires that at least 30 cents per passenger is charged in order to get reimbursement. Therefore, TCAT would need to account for a certain revenue dollar figure to be designated as being the match for STOA. It does not appear that this is a limitation to going fare-free, merely something that needs to be accounted for in our finances.
If we assume that going fare-free means the eventual elimination of the fare boxes, we must account for the ongoing need to accurately count passengers. This is essential for the efficiency of the TCAT system and for reimbursement purposes. In order to maximize the operational efficiency of the system, TCAT needs to know as much information as we can about who is riding, and where and when. TCAT does have Automatic Passenger Counters. The status of these counters would need to be assessed at such a time as fare-free is to be initiated.
One assumption that should not be made about a fare-free system is that, for example, a 20% increase in ridership would equal 20% more people using the system, or would result in a significant decrease in the number of cars on the road. There is some evidence that in a fare-free system, a considerable number of people will board a bus for a short trip that they might otherwise have walked. This is not a reason to decide against going fare-free, but it is something to keep in mind in terms of managing expectations.
There is also reason to believe that safety issues can rise in a fare-free system. Without a barrier of having to pay to board a bus, some people may do so and cause trouble. It is something that should be monitored if TCAT were to go fare-free so that any increase in incidents could be dealt with appropriately.
Some thinking should be done about the opportunity cost of going fare-free. Is going fare-free the most important project TCAT should engage in, given limited resources? New routes and increasing the frequency of service on existing routes would also serve the community well. For example, in 2014, Tioga Transit bus service was discontinued to West Danby. This is a very large geographic area that TCAT does not cover. Would the use of $1.5 million a year be better put towards going fare-free or towards restoring bus service to a large corner of the county?