To balance this year’s budget, Fairfax County raised the price of express bus routes 380, 595 and 597 from $3.00 each way to $7.00 each way. They didn’t change schedules or service frequency. And they didn’t make a similar change on three other lines, creating nearly ideal conditions for an economics experiment. The result: On two of these express bus routes, Fairfax lost little ridership and nearly doubled their revenue. Meanwhile, ridership and revenue plummeted on the third.
Fairfax didn’t publicly explain their reasoning, but I believe it related to with the recent increase in federal transportation subsidy. Federal workers can now get $230 per month in transit passes, up from $120 per month previously. With that change, round-trip travel for federal workers less than about $12 per day is essentially free, providing a means for local governments to get additional revenue without losing much ridership. However, this depends on riders being primarily government workers, and not having close substitutes for their commutes.
The baseline data showed a slight increase in ridership from June to July. Average ridership grew between 1.75% and 7.8% for lines 171, 401 and 950, whose fares did not change.
For lines 595 and 597, which travel between park and rides in Reston and Pentagon/Crystal City, respectively, the lines experienced modest drops in ridership, about 20%. Combined with nearly doubling of fares, the change resulted in a net revenue gain for the county, nearly doubling. This is probably due to the high government employees ridership and lack of close substitutes for these lines. The nearest substitute other than driving would be to take a bus to West Falls Church, take the Orange line and then transfer to the Blue line, a “three seat” ride. According to the schedules, that trip takes approximately the same amount of time, but with three vehicles, it’s more likely that one of them would have a problem.
In contrast, ridership on line 380, from Franconia/Springfield to the Pentagon, dropped by almost 80%, and average revenue was cut in half. Although the ridership is likely a lot of government workers, the Blue line provides the same trip with a much better frequency, about the same travel time, a more comfortable ride, and after the fare change, about half the cost.
These results show that it’s sometimes possible to get more revenue by raising fares, but the results depend heavily on the circumstances. Fairfax should reconsider its decision to raise fares so heavily, at least on the 380. Where there are close substitutes, large fare increases can actually decrease revenues and are counterproductive. Now there are fewer people riding the 380 and paying more each, so the county has to subsidize the bus line even more.
The county has informed me that they are studying a new variation of the 380 line to visit more park and rides and charge a lower fare. This is in the preliminary stages so it would still need to be vetted by Supervisors for impact on their constituents. It is still a very, very rough draft plan.