Fiscal Management and Control Board. Fare Policy October 16, Draft for Discussion & Policy Purposes Only

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1 Fiscal Management and Control Board Fare Policy October 16,

2 Components of Fares Fare Level Different types of pricing by: By mode By time of day By distance By rider type (reduced fare) Subscription vs pay per ride Operations How and where people purchase and validate their fare: Before boarding vehicle While boarding vehicle After boarding vehicle Technology How we collect fares: Fare media (cash, ticket, smartcard, mobile) Hardware (faregates, fareboxes, readers, etc) Software (back office, account based, real-time capacities) Enforcement Different methods/responsibilities: Gated areas Frontline employees Proof of payment with inspection MBTA Police 2

3 Legislation around Fares Section MGL 161A(5)(d) 161A(5)(e) MBTA Requirement Public hearings for fare increases of 10% or more 50% discounts for: those ages 5-11, 65+ and disabled MA residents 161A(5)(q) Maximize fare revenue through reasonable and equitable fares, ridership growth & TOD 161A(11) Achieve a Net Operating Investment Per Passenger Mile (NOIPPM) of $0.20 or better. 272 (98a) Not charging blind or deaf people and for seeing-eye dogs. Session Laws 2013, Ch 46(4) Increase Fare Recovery Ratio by at least 10% annually 2013, Ch 46(61)(d) Not raise fares more than every 24-months, or at an annual rate greater than 5%. Operating budget to include sufficient revenue from fees and fares to meet benchmarks 2013, Ch 46(61)(d) established in the statute (for FY17) 2013, Ch 46(61)(d) Contribute at least 32.75% of operating revenue from fares/fees Federal Regulations FTA circular A Not directly or inadvertently cause a disparate impact or disproportionate burden on any protected group or individual Equity analysis for any fare increase or decrease in any amount 3

4 Legislation around Fare Policy 161A(5)(r) To adopt, and revise as appropriate, a fare policy which addresses fare levels, including discounts, fare equity and a fare structure, including, but limited to, fare media and passes. Said fare policy shall include a system for free or substantially price-reduced transfer privileges. 4

5 Current Fares Base Fare (Cash/ Ticket) Local Bus Rapid Transit Commuter Rail $2.10 $ Zones (Z1A, 1-10) CharlieCard $1.60 $2.10 Fare: $ Monthly Pass $50 $75 $75-$ Discrete Fare Products Services: Local bus, express bus (inner/outer), rapid transit, commuter rail (zones and interzones), ferry (4 services), theride Payment media: Cash, CharlieCard, CharlieTicket, Mobile, Ticket Time: Passes (month, 7 day, 1 day), stored value, 10 ride Who: Reduced fares for seniors, people with disabilities, students 5

6 History of Fare Increases Single-Ride Fares Over Time MBTA Fare Revenue by Mode $2.50 Rapid Transit (Heavy & Light Rail) Commuter Rail Surface Transit (Bus and Trolley) School, Senior & Paratransit (RIDE) $ % +5% Ferry Boat $700,000,000 $ % +20% +7% $600,000,000 $500,000,000 $ % +39% $400,000, % $300,000,000 $0.50 $200,000,000 $0.00 $100,000,000 Bus Single-Ride Fare Subway / Rapid Transit Single-Ride Fare $0 6

7 Passes and Mode Differential Should we encourage pay per ride or subscription/pass usage? What multiple for passes? What differential between bus and rapid/bus for the core MBTA system? Agency Base Fare Subway One trip Bus Cost of Bus + Subway Pass Multiple 28.3 (base fare) MBTA $2.65 $2.10 $ (CC fare) $50 MTA $2.75 $2.75 $ n/a Cost of Bus Only Pass Multiple Notes 23.8 (base fare) (CC fare) MUNI $2.25 $2.25 $ $ $ $5.90 $1.75 $ WMATA SEPTA $2.25 $2.25 $ n/a MARTA $2.50 $2.50 $ n/a CTA $2.25 $2.00 $ n/a TriMet $2.50 $2.50 $ n/a $17.50 a week 40.0 $83 pass usable on BART stations within San Francisco $4 used as base fare for multiple calculation, 4 week passes in a month 7

8 Fare Policy Set by two documents 1) Fare Policy Statement: States policy objectives used to make fare decisions Satisfies 161A(5)(r) Last adopted in ) MBTA Tariff: Sets fare levels and transfer rules, pass validity, etc. -Up for review every 2 years per legislation 8

9 Existing Fare Policy Statement Adopted in Customer- and Community-Related Objectives a. Increase Ridership Utilization and Occupancy b. Establish Equitable Fares c. Enhance Mobility and Access 2. Financial and Privacy Objectives a. Maintain or Increase Fare Revenue Stream b. Maximize Fare Revenue Collection c. Respect Customer Privacy 9

10 Possible Policy Objectives 1. Increase revenue a. Maximize fare revenue collection b. Increase ridership c. Fare structure easy to understand d. Fares easy to pay 2. Improve Operations a. Shift ridership to under used capacity b. Reduce dwell times c. Minimize conflicts between operators and riders 3. Social and Environmental Goals a. Equitable fare structure b. Increase regional access and mobility c. Promote mode shift d. Respect Customer Privacy 10

11 Next Steps FMCB feedback on Fare Policy Objectives Revised Fare Policy statement Public input on Fare Policy statement FMCB adopts new Fare Policy statement FMCB considers Fare Change scenarios Public input on Proposed Fare Changes FMCB adopts Fare Changes as part of FY17 Budget Fare Changes take effect July 1,