Rethinking Metro’s passes, part 3: A new pass proposal

Yesterday, we talked about Metro’s existing rail and bus pass system, and some key features and ideas that should guide a redesign. Based on those considerations, here are my proposed weekly passes for Metro:

• Buy Bus, Get Rail Free. Off-peak rail usually has some spare capacity available. But a bus flash pass holder has a choice between pay-per-use rail and free bus. Since it would improve customers’ available options and would not likely cost Metro much more, unlimited weekly bus passes could also give the holder off-peak rail at no additional charge.
• Pick-Your-Price Rail. Metro offers two weekly rail passes, one at $39 for unlimited rides, and one at $26.40, good for rides up to $2.65 each way (you can pay any extra at the Addfare machine). Why not expand the options to include any amount the customer wants? The Seattle area has the Puget Pass (PDF), where you select your typical ride price, and buy a pass based on that price. For example, if you typically pay $2.00 each way, you’d pay $20.00 a week for the pass. Any rides at that price or less would be free. The system could deduct any extra from your stored value. Metro could then offer passes good for any value from $1.35 (the lowest non-rush fare) all the way up to $4.50 (the maximum fare).
• Just Add Bus. While we’re at it, why should rail passes be limited to rail only? Metro should give rail pass customers the option to add an unlimited bus pass for $6 or $7. It needs to be cheaper than adding a full $11 bus pass because of transfer discounts, but not too cheap or else Metro will lose too much revenue.

This simplifies the passes available while still providing a lot of flexibility. Bus passengers get some free rail, rail passengers get a pass that meets their specific needs, and people that ride both get a pass that reflects the transfer discounts they’re used to.

Here are some other things to think about:

One difficulty with the customized rail pass is how to get people to buy the pass for the full value of their typical commute. There’s an incentive to lowball the requested amount so that less money is wasted on days that you might be sick, on travel or leave, or travel outside of rush periods. The system will automatically deduct any extra, so it would still work and be just as convenient to buy a $23.00 pass, commute with it and enjoy unlimited nights and weekends.

Is this undesirable? One of the benefits for the transit agency is that they receive a steady stream of revenue, and it might be good to increase that by encouraging rail commuters to buy larger passes. Although it raises some city/suburb balance and equity concerns, it might be desirable to encourage larger passes by offering something like a 5% discount on the pass price above $23.00 or even on the entire pass price.

Another difficulty with encouraging pass use is that many workers are on alternative work schedules, sometimes involving alternate Fridays or Mondays off, or working one or more days from home. These workers might end up having half of the weeks a pass being a good deal, and half not. Would it be worth it to encourage those workers to buy a pass all the time rather than buying them only some weeks? One way to do this would be to provide a loyalty program, where if you buy twelve passes in a row, the thirteenth is free. Some transit systems sell more heavily discounted monthly passes, and a few even offer a yearly subscription with the twelfth month free. This would be a return to the situation before 2001, where large farecard purchases enjoyed a 10% bonus, but it would be applied only to riders using passes, and it would be available to bus riders too.

Under this system, here are some scenarios:

• Unlimited Bus and Rail (annual): $2,577.60 (compare to $2,600 today for 52 bus and rail passes, or $2,646 for maximum rail + bus fare with transfers for all work days)
• Medium distance rail ($2.65 each way): $1,262.40 per year (compare to $1,372.80 for 52 short rail passes)
• Long-distance rail: The biggest discount over existing passes would go to those riding exactly $3.90 each way, who would pay $2,121.60 per year for service that used to cost $2,600.00, and would enjoy unlimited bus and nearly unlimited rail.
• Bus-only rider: This person would go from paying $572 a year for unlimited bus to paying $528 (8% decrease over what was already discounted about 13%) and getting unlimited off-peak rail, a really good deal when you take into account the extent of Metro’s bus and rail service.

To balance out these additional discounts, which can be up to 18% off the current pass price, Metro would likely have to increase the single ride fares (though not by the full 18% because some people would get smaller discounts than 18%). This is somewhat consistent with the opinion I’ve seen frequently here and other blogs, that we should increase prices on non-SmarTrip, non-commuter fares more than others.

Metro is going to have to do something when passes are migrated to SmarTrip. They need to figure out what the rules are for transfers, since we haven’t had any transfer possibilities with passes. They’re also going to need to deal with a fairly large revenue loss if they just port over the passes we already have. There are some passes that a lot of people are going to start using once they get more convenient, and their off-peak revenue is going to decline.

Therefore, Metro should completely redesign the bus and rail pass system. For bus passengers, giving pass holders unlimited off-peak rail is both fiscally and technologically feasible. For rail passengers, there’s no need to offer only two options when a pick-your-price pass would suit riders’ needs. For customers that ride both rail and bus, Metro should offer a combination pass that takes into account transfer discounts available to cash passengers. Purchasing passes should be encouraged through appropriate volume and loyalty discounts.