Transit officials in Kansas City, Mo., plan to eliminate bus fares system-wide this year. Leadership views the move, which will erase about 8 percent of the agency's revenue, as a boost to the local economy.
Buses in the largest city in Missouri are on track to offer free rides.
Officials with the Kansas City Area Transportation Authority (KCATA) plan to phase out the system’s $1.50 fare in the coming year, in a move to remove at least one barrier standing in the way of riders choosing the transit system to get to jobs, run errands and more.
Public transit “needs to be woven into the fabric of the community as a whole,” said Robbie Makinen, president and CEO of KCATA. And discussions about improving health care, housing, education and other quality-of-life factors are all intricately linked to transportation and transit.
“You can’t have discussions about solving those issues without public transit,” he remarked.
If the idea of a fare-free transit system seems radical, Makinen is quick to point out that KCATA has been gradually phasing out fares for certain users. Today, veterans ride free, as do high school students. Also, the agency teamed up with “safety net” providers such as domestic violence shelters to waive fares for users of these services as well.
Fares have also been removed from a newly launched bus-rapid transit line, a 10-mile corridor known as Prospect Max.
“So when people say, ‘Oh, they made transit free in Kansas City,’ no — we’ve been systematically and strategically looking at this,” Makinen said.
It should also be noted that the new Kansas City Streetcar, stretching two miles through downtown, has always been free to ride.
Fares make up about 8 percent of KCATA’s $100 million budget, said Makinen, and once the costs associated with collecting and counting the money are taken into consideration, “it’s not really $8 million. It’s less.”
A fare-free system would also speed up boarding times, since buses often dwell for several moments while riders feed money into fareboxes. Removing fares would also have the positive effect of removing opportunities for disputes between riders and bus drivers.
“Before, when there was an incident, 85-90 percent of the time something happened on a vehicle, it was because of ... $1.50. It was a farebox dispute,” said Makinen. “With this, now our operators are safer because the operator isn’t the focus of an incident, if there is one.”
Transit systems as large as those like Los Angeles Metro have toyed with the idea of waiving fares. At the recent CoMotion LA conference in Los Angeles in November, Phil Washington, CEO of LA Metro, proposed using revenue generated from congestion pricing to replace fare revenue in the areas where congestion pricing is put in place.
“We haven’t even scratched the surface, in terms of the benefits that free transit can bring,” said Washington in comments at the conference. “Free transit in the area, and taking that burden away from families, in terms of the expense of transportation, could mean the difference between affordable housing. It could impact homelessness.”
LA Metro has not yet released any congestion pricing proposals, and is still studying the issue. About 4 percent of LA Metro’s revenue is generated from fares, according to financial reports.
In St. Louis, a closer peer city to Kansas City, fares make up about 15 percent of revenues, said Jerry Vallely, external communications manager for Bi-State Development, which oversees Metro Transit in St. Louis.
“The only group of riders we waive fares for are children 4 and under,” said Vallely. “We do offer half-price fares for seniors, children 5-13 and disabled passengers. We currently do not waive fares for any specific routes or services.”
The average passenger fare across U.S. transit systems was $1.56 in 2017, according to the American Public Transportation Association (APTA). Fares made up 36 percent of operating funding, for transit systems nationwide, followed by local sources (32 percent), state sources (23 percent) and other sources (9 percent). Transit agencies also receive federal and other funding, often earmarked for capital projects.
When viewed through the larger economic lens, said Makinen in Kansas City, money that riders would have dropped into fare boxes will be reinvested back into the local economy.
The University of Missouri-Kansas City conducted a financial impact study looking at the effects of eliminating fares. The study concluded the $8 million collected in fares goes back into the local economy, generating $17 million in economic activity and $700,000 in sales tax and 100 new jobs.
“If Ms. Johnson is living on Prospect [Avenue] and she’s saving $1,500, $2,000 a year on public transit because she’s not putting it in my farebox, where’s that money going to go? It’s not going to leave the state. It’s going right back into the local economy,” said Makinen.
To finance an $8 million budget hole formed when rider fares disappear in Kansas City, Makinen said he aims to keep the growth of the administrative arm of KCATA to a minimum, which he believes frees the agency to be more nimble and make it more open to exploring technology and other innovations.
“And then we’re also going to work — like we’re doing now — on public-private partnerships to say, ‘OK, you want to try something? Come to Kansas City, and let’s do a pilot,’” Makinen added.
Ultimately, making the bus free stands to increase ridership within the KCATA system. The free bus rapid transit line serves some 85,000 riders a month. But that’s hardly the only goal.
“Ridership is a byproduct,” said Makinen. “It’s a byproduct of [having] a system that offers something to the customers: easy access, options, control and definitely affordable now.”