Should Virginia bus systems go fare free permanently?

A version of this article first appeared in the Virginia Mercury.

When the General Assembly created the Transit Rider Incentive Program (TRIP) as part of Gov. Ralph Northam’s 2020 transportation omnibus, the lion’s share of the funding was allocated to support new regional bus routes. With COVID’s cancellation of much commuter service across the commonwealth, those dollars are now being dedicated to TRIP’s secondary goal: fare free transit pilot projects.

With large localities like Lynchburg, Roanoke, Alexandria, Richmond, Charlottesville, and Fairfax County now expressing interest in eliminating bus fares for at least three years, could the shift to zero fares in Virginia become permanent?

Have you heard the news? We plan to stay FARE FREE for the next 3 years. #Transit https://t.co/w4Ela02IuZ

— Charlottesville Area Transit (@RideWithCAT) March 26, 2021

Original intent

When lawmakers first allotted $1.5 million to the Department of Rail and Public Transportation last year, 75% of the funding was reserved to enhance regional connectivity in urbanized areas with populations of over 100,000 residents. The other quarter of the money was set aside to test out various initiatives to offset bus fares for low-income Virginians.

“That bill language passed, and then COVID-19 happened a couple days later,” said Jennifer DeBruhl — chief of public transportation at DRPT. “Since then the focus for TRIP has really shifted. Regional commuter services have had significant ridership impacts due to the pandemic and the shift to telecommuting, so there is somewhat less demand on that side of the program. However, the whole equity conversation that occurred over the course of the last year brought folks to look at how we can do more to make transit more affordable.”

DRPT’s efforts to make public transportation in Virginia more accessible got a shot in the arm this year when TRIP received a surprise $10 million allocation in the final round of budget negotiations. Although the initial $1.5 million is still locked into the original spending breakdown, the additional infusion of funds is free to be spent according to demand.

Nearly every transit system in the commonwealth eliminated fares last year as a public health measure in response to COVID, but until recently none had announced intentions to make that move to protect riders and operators more permanent. Based on the responses to a request for ideas DRPT issued to transit providers last fall, the list of bus systems seeking to stay fare free beyond the pandemic could soon grow substantially longer.

Free fares in Alexandria? “Alexandria Mayor Justin Wilson said it’s not as big a challenge as it once was to make it happen, from a funding perspective…He pointed out that fares haven’t been charged on buses for much of the past year.” https://t.co/1F6eV13rHl

— Coalition for Smarter Growth (@betterDCregion) March 31, 2021

Rural riders

Although even the terminology “city bus” evokes urban areas, few folks understand the extent to which rural Virginians rely upon public transportation as well. “The language in the bill creating TRIP specifies both urban and rural transit,” DeBruhl said. “Transit is a much bigger deal in these smaller areas than many people realize.”

Graham Transit in Bluefield, Virginia, on the West Virginia border, may only run three fixed routes to serve the town of 4,907, but their daily operations are a sign of how essential their service is. “Our primary route covers a low-income area, and that’s where the majority of our ridership comes from,” said James Hampton — Bluefield’s transportation manager. “We’re their only source of transportation. Without the bus they wouldn’t be able to get to doctor’s appointments or their jobs.”

In 2019, Graham Transit logged a new record for ridership, transporting more than 45,000 passengers in one year. Since the start of the pandemic, however, Bluefield’s buses have lost around 7,000 to 8,000 riders due to public health measures limiting capacity. “Our buses hold 14 passengers, but with the pandemic for safety reasons we can only hold seven at a time,” Hampton said.

Declining ridership would have meant declining farebox revenue if federal aid weren’t already filling the funding gap, but the 25 cent fare to ride Graham Transit never earned the agency big bucks even before COVID. The $8,000 riders paid into the system in 2019 represents little more than a drop in the bucket of Bluefield’s $300,000 annual bus budget. Now Hampton is hoping the TRIP program could cover that 2.6 % of funding riders used to provide.

“We’re looking at eliminating fares for many reasons from COVID to just the logistics of operators getting the coins to the main office,” he said. “Going fare free means our riders won’t have to worry about scrounging up a quarter which isn’t a lot of money, but a quarter is still a quarter. In the long run, I think going zero fare will actually increase our ridership.”

Eliminating fares is also likely to save Graham Transit money. The cost of the fareboxes alone in each of the town’s four buses adds up to $7,468 according to Hampton. Their coin counter is another $100. Once the staff time required to collect and transport the money and then reconcile those amounts with ridership counts is added in, the whole fare-collection endeavor hardly seems worth the cost.

Fare isn’t fair

A little more than 200 miles to the east, the math for Greater Richmond Transit Company also presents a compelling case to consider keeping zero fares beyond the pandemic: $570,000 for farebox collection and security, $400,000 for fare enforcement on the Pulse, $340,000 for the paper to print bus passes — all those costs and more add up to over $1.7 million GRTC spends annually to maintain fare collection on its fleet of buses.

“If I’m spending $1.7 million each year to collect $7 million in fares from businesses, institutions, and wealthier commuters, then that makes sense to me,” said GRTC CEO Julie Timm. “But if I’m spending $1.7 million each year in order to collect the majority of fares from impoverished people who can barely afford to put their money into the system, then we need to reflect.”

According to GRTC’s recently released 2020 annual report, 27% of riders have a combined household income of less than $10,000 per year. Over half earn less than the federal poverty rate for Virginia of $26,500 for a family of four, and a full 89% of GRTC’s riders have household incomes below the state median. Layer on the statistic that 74% of the system’s riders are people of color, and the equity argument behind refraining from fare collection grows ever stronger in the eyes of advocates.

“The ridership holding so strong throughout the pandemic is a testament to how much of an essential role GRTC plays and how our region’s essential workers rely upon the bus to get around,” said Nelson Reveley, director of operations for RVA Rapid Transit — the state’s only transit rider advocacy group. “The vast majority of folks riding GRTC right now are already wrestling with low incomes, and the pandemic has hit them really hard. Being able to extend that financial relief of free transportation, which has a value to households of, on average, $1,000 per person per year, would be huge.”

In fiscal year 2019, GRTC collected roughly $4.5 million in revenue from local routes in the City of Richmond, the same routes which are primarily frequented by low-income people of color. Even officials in Chesterfield County — an historically transit-skeptical locality — seem increasingly convinced eliminating fares could be a boon to workers and function as a backdoor boost to wages.

“When you start looking at transit as a public service versus a business, it starts to make more sense,” said Jesse Smith, the deputy county administrator, in an interview with the Chesterfield Observer.

Pilot or permanent?

For now, advocates like Reveley are calling on local leaders to organize a multi-year pilot program to analyze the impact of zero fares on GRTC and its riders beyond the pandemic. “We want to be able to test out the practical, political, and fiscal realities of it,” he said. “In the near term, there is no tradeoff between zero fares and greater frequencies or coverage because of the expansion coming via the Central Virginia Transportation Authority. Having a three to five year pilot would give us time to dig into what is the most equitable transit system we can have and allow time for deeper community conversations to figure out long-term funding.”

If the roughly $5 million needed annually to maintain GRTC’s zero fare policy permanently can’t be found, Richmond’s bus system would likely move to an account-based system similar to that of Metro’s pre-loaded tap cards. The additional costs of such a system including new technology, call center staff, and the requirement to still accept cash to accommodate riders without bank accounts would almost certainly lead to a system-wide fare hike.

“Account-based systems are very expensive to put in place and maintain,” said Timm. “Other places like Nashville that have gone this route have actually introduced a higher base fare at the same time as they rolled out more equitable policies like fare-capping. When you have the counterbalance of a strong commuter population, it can make sense, but one of the things COVID taught us is that we don’t have that here.”

One concept under consideration would leave all Richmond routes fare free but charge GRTC riders whose commute crosses county lines. Beyond the fact that such a hybrid fare system would actually cost more than staying fully fare free, the greater concern is that anything less than a system-wide commitment to zero fare transit may not earn the endorsement of DRPT — or access to its TRIP funds — either.

“When you start breaking out just pieces and parts of a system as zero fare, that requires a lot of enforcement and additional administrative costs to control who has access to zero fares and who doesn’t,” said DeBruhl.

Currently DRPT is finalizing a solicitation for applications for its TRIP program which it hopes to share with Virginia’s forty-plus transit providers later this spring. “We are really looking for meaningful, well-planned project proposals,” DeBruhl said. “We want to see where folks have put the time and thought into how they would implement zero fare transit and where there is a longer term commitment to having zero fares as a multi-year pilot project.

Timm for one hopes to submit a winning proposal: “Maintaining zero fare transit is an investment in our communities, in our economy, and in our future growth, but the reality is that it’s a gap in our budget that has to be filled. In Richmond, our funding gap is so small that if we were ever to wean off of fares now is the time to do it. However, if we do continue zero fares post-COVID, we need some kind of acknowledgement from our partners that when we get to the end of the pilot that they would be willing to still invest in this model.”