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Fare-Free Transit Evaluation Framework (2022)

Chapter:3 Fare-Free Transit Evaluation in Practice

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Suggested Citation:"3 Fare-Free Transit Evaluation in Practice." National Academies of Sciences, Engineering, and Medicine. 2022. Fare-Free Transit Evaluation Framework. Washington, DC: The National Academies Press. doi: 10.17226/26732.
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Suggested Citation:"3 Fare-Free Transit Evaluation in Practice." National Academies of Sciences, Engineering, and Medicine. 2022. Fare-Free Transit Evaluation Framework. Washington, DC: The National Academies Press. doi: 10.17226/26732.
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Suggested Citation:"3 Fare-Free Transit Evaluation in Practice." National Academies of Sciences, Engineering, and Medicine. 2022. Fare-Free Transit Evaluation Framework. Washington, DC: The National Academies Press. doi: 10.17226/26732.
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Suggested Citation:"3 Fare-Free Transit Evaluation in Practice." National Academies of Sciences, Engineering, and Medicine. 2022. Fare-Free Transit Evaluation Framework. Washington, DC: The National Academies Press. doi: 10.17226/26732.
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Suggested Citation:"3 Fare-Free Transit Evaluation in Practice." National Academies of Sciences, Engineering, and Medicine. 2022. Fare-Free Transit Evaluation Framework. Washington, DC: The National Academies Press. doi: 10.17226/26732.
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Suggested Citation:"3 Fare-Free Transit Evaluation in Practice." National Academies of Sciences, Engineering, and Medicine. 2022. Fare-Free Transit Evaluation Framework. Washington, DC: The National Academies Press. doi: 10.17226/26732.
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Fare-Free Transit Evaluation Framework 3-1 3 FARE-FREE TRANSIT EVALUATION IN PRACTICE This chapter reviews the state of the practice of fare-free transit evaluation. This review was informed by a transit agency survey and interviews with staff from transit agencies, community organizations, and transit advocacy groups. The findings from this research informed the development of the fare-free transit evaluation framework. WHAT RESEARCH HAS BEEN CONDUCTED ON FARE-FREE TRANSIT EVALUATION? Despite growing interest in fare-free transit among US transit agencies, there are few studies on fare-free transit in the US; most research appears to explore case studies in other countries.27 Prior to the publication of this report, there were no apparent examples of a robust fare-free transit evaluation framework. Most research on fare-free transit in the US has focused on small urban areas, rural communities, or university and resort towns where transit agencies provide full fare-free transit. Much of this research was synthesized into the Transit Cooperative Research Program’s (TCRP’s) 2012 Synthesis 101: Implementation and Outcomes of Fare-Free Transit Systems report.28 Major findings from that report include:  Most fare-free transit agencies serve small communities  Transit agencies with low farebox recovery ratios are most likely to implement fare- free transit  Some funding sources reward transit agencies for operating fare-free  Fare-free transit can be a competitive asset for resort communities  Fare-free transit can improve operations on high-volume services

Fare-Free Transit Evaluation Framework 3-2  Implementing fare-free transit typically increases ridership by 20% to 60%  Fare-free transit eliminates fare disputes with operators but can increase the presence of disruptive passengers  There can be new or increased costs associated with fare-free transit  About 5% to 30% of new fare-free transit trips are made by people switching from other motorized modes  Fare-free transit can be a point of community pride WHAT INFORMATION INFORMED THIS REPORT’S EVALUATION FRAMEWORK? The fare-free transit evaluation framework in Chapter 2 of this report was developed based on qualitative and quantitative state-of-the-practice research described below. This research consisted of three primary methods:  A survey of transit agencies at various stages of fare-free transit consideration or implementation.  Interviews with staff from transit agencies, community organizations, and transit advocacy groups  A literature and media review of academic research, planning work, and journalism on fare-free transit More detail on each of these methods is below.

Fare-Free Transit Evaluation Framework 3-3 Transit Agency Survey The research team surveyed 35 US transit agencies and one state transportation agency to gather various perspectives on fare-free transit evaluation. The survey respondents represented transit agencies from various categories of fare-free transit (Figure 3-1). Figure 3-1 Table of Transit Agencies Surveyed Survey Agency Category Description of Category No. of Agencies Surveyed Full fare-free Transit agency does not collect fares from any riders. 14 Partially fare- free Transit agency does not collect fares from specific groups of riders, on certain routes or transit services, or in defined areas. These transit agencies may have been considering piloting or implementing fare-free transit. 16 Not fare-free Transit agency collects fares from all riders. These transit agencies may have been considering piloting or implementing fare-free transit. This category also includes one state agency respondent. 6 Total 36 The respondent agencies varied in terms of operating size and context. All full fare-free respondent transit agencies served small urban, rural, resort, or university-dominated communities, with smaller ridership, lower farebox recovery, and lower operating expenses than systems in larger metro areas. The partially and not fare-free respondents represented a wide range of transit agency sizes in terms of passenger trips provided, operating expense, and farebox recovery. Additional information on the methods and findings from the survey are in Appendix A. Interviews The research team conducted interviews with two types of subjects:  Transit Agency Staff: The project team identified 23 transit agencies with which to conduct staff interviews and assess as case studies based on the transit agency responses and other research into fare-free transit. These 23 agencies range in terms of size and type of community served. Staff from the case study transit agencies were interviewed through video conference calls or by email. The role the interviewed staff played in the evaluation or implementation of fare-free transit varied across transit agencies. Interview findings were used to create the case studies in Chapter 4 of this report and inform the findings of the state of the practice and the evaluation framework.

Fare-Free Transit Evaluation Framework 3-4  Staff from Community Organizations and Transit Advocacy Groups: The project team conducted interviews with staff from community-based organizations and transit advocacy groups to gather information on perspectives of fare-free transit from various transit stakeholders. The project team leveraged existing connections with community representatives in Chicago and elsewhere in the US to solicit feedback from eight organizations. Additional information about the interviews and key findings can be seen in Appendix C. Literature Review Throughout the survey, interviews, and evaluation framework development process, the project team reviewed various academic and professional research documents, journalistic assessments of fare-free transit evaluations and implementations, and transit agency or consultant reports and briefs. These documents are cited throughout this report. WHAT IS THE STATE OF THE PRACTICE? Findings from the research team’s survey, interview, and literature review work are summarized below under two main topics:  Fare-free transit impacts: The measured and anticipated effects of fare-free transit for transit agencies and the communities they serve.  Fare-free transit evaluations: How transit agencies have evaluated the impacts and long-term success of fare-free transit in their communities. Fare-Free Transit Impacts Fare-free transit has many impacts—both costs and benefits. These costs and benefits are borne by different stakeholders; riders, non-riders, transit agency staff, local government, non-profit organizations, and the broader community are all affected. The impacts of fare-free transit were commonly cited by survey respondents and interviewees as the primary way transit agencies organized their evaluation and/or monitoring of fare-free transit. These impacts can be organized into two categories:  Measurable impacts: These impacts can be measured and shown to have been an outcome of fare-free transit. Examples of measurable impacts include changes in ridership, operating costs, or farebox revenue. Although some transit agencies have measured these impacts, many other transit agencies have not. This makes generalizing and predicting measurable impacts of fare-free transit difficult in many cases.

Fare-Free Transit Evaluation Framework 3-5  Assumed impacts: Assumed impacts include costs and benefits that cannot easily be measured, but reasonable logic leads transit agencies to assume they are occurring, sometimes with the assistance of qualitative information. Examples of assumed impacts include changes in the perceived or actual safety and comfort of passengers, community traffic congestion, and greenhouse gas emissions. This section summarizes the project team’s findings on the measured and assumed benefits and costs of fare-free transit. Further, the impacts are organized under four common themes: access, mobility & equity; operational efficiency, financial health, and community impacts (Figure 3-2). Figure 3-3 outlines the impacts discussed in this section. Figure 3-2 Fare-Free Transit Impact Themes Access, Mobility & Equity Operational Efficiency Financial Health Community Impacts How fare-free transit impacts transit access, mobility, and equity How fare-free transit impacts a transit agency’s ability to provide and operate quality service How fare-free transit impacts a transit agency’s short- and long- term financial wellbeing How fare-free transit impacts the community’s economy, sustainability, and congestion

Fare-Free Transit Evaluation Framework 3-6 Figure 3-3 Summary of Fare-Free Transit Impacts Access, Mobility & Equity Benefits  Increases transit ridership  Reduces financial barriers to accessing transit  Mitigates impacts of historically inequitable transportation policy  Increases focus on operating service over collecting revenue  Eliminates fare-related policing  Expands access to those who do not benefit from discounted programs provided through employers Costs  May constrain funding that could be spent on service  May lead to more regressive source of funding (e.g., sales tax) Operational Efficiency Benefits  Increases service productivity  May decrease dwell times, increasing speed and reliability  Eliminates fare-related disputes  Eliminates fare collection equipment and attendant labor requirements (e.g., operations and maintenance) Costs  May lead to overcapacity on some trips and require additional service  May increase paratransit demand and require additional service  May restrict transit agency’s ability to collect ridership data  May increase presence of disruptive passengers and result in additional security costs and impacts Financial Health Benefits  Reduces or eliminates fare collection costs  May reduce overall cost per passenger trip  May expand transit agency eligibility for new funding sources Costs  Eliminates farebox revenue, which may be considerable for many transit agencies  Likely to require new revenue sources, such as taxes, municipal contributions, or private partnerships Community Impacts Benefits  May reduce traffic congestion  May reduce local pollution and greenhouse gas emissions  May catalyze development and/or increase land value  May increase community pride  Allows riders to spend money in the community they would have spent on transit Costs  May increase public criticism of transit agency and its fare policy

Fare-Free Transit Evaluation Framework 3-7 Note: Impacts noted in this chart may vary by type of fare-free transit. For example, a partially fare-free transit system may not completely eliminate farebox equipment, which would not allow the transit agency to benefit from reduced operating and maintenance costs associated with fare collection equipment. Benefits The primary benefits that survey respondents and interviewees reported from fare-free transit include greater mobility for community members, social equity improvements, more efficient transit service, reduced fare collection costs, and local economic growth. These key benefits and others are discussed in more detail below. Access, Mobility, and Equity Survey respondents and interviewees reported that fare-free transit almost always causes an immediate increase in transit ridership. To the extent that a financial barrier to accessing transit is removed from community members, their mobility is also improved. In many instances, this improved mobility means greater access to opportunity (e.g., school, shopping, recreation, healthcare) for community members. Survey respondents and interviewees also reported that fare-free transit is assumed to improve social equity outcomes, as lower-income passengers save money they might otherwise have spent on transit. More specific survey and interview findings related to access, mobility, and equity benefits of fare-free transit include:  Transit agencies that went fare-free prior to the COVID-19 pandemic saw an increase in fixed-route ridership anywhere between 20% and over 100% in the first two years, especially among those who are young, those with low-incomes, and those experiencing homelessness. Most transit agencies that went partially fare-free for only select populations did not see significant increases in ridership.  Transit agencies experienced a range of paratransit ridership changes after going fare-free, from no change to a 60% increase.  Transit agencies that piloted or implemented long-term fare-free transit following the COVID-19 pandemic have also seen increased ridership up to 26%. 29  Though some transit agencies already provide discounts to some rider groups, these discounts often have barriers to access, such as personal identification or application requirements, and other administrative burdens. The impact of these barriers is clear from the observed low uptake rates of many low-income programs. Full fare-free transit eliminates these barriers and reduces administrative burdens for both riders and transit agencies.30

Fare-Free Transit Evaluation Framework 3-8  Partial fare-free transit that is focused in areas and on modes that are most used by low-income, minority, and youth riders allows transit agencies to maintain a source of fare revenue, particularly from higher-earning riders.  Existing transit subsidies, such as employer passes, often provide de facto fare-free transit to certain riders, many of whom are higher-income. This is an inequitable outcome where riders who can afford transit receive discounts, and riders who may benefit more from fare-free transit do not have access to these discounts. 31 Fare-free transit can reduce this inequity.  Fare-free transit can reduce transit agencies’ focus on farebox recovery and increase their attention to service provision based on need, creating a more equitable service that does not consider ability to pay.32  Many riders prefer full fare-free transit to partial fare-free transit, because the latter may involve fare enforcement, which can lead to overpolicing of racial and ethnic minorities, who are often more likely to be transit-dependent.33, 34 Ridership Increase at Mountain Line In 2015, Mountain Line (Missoula, MT) piloted their ‘zero-fare demonstration project’. Within three years, the transit agency saw a 70% increase in ridership. The increase was largest in the first two years after the fare-free pilot began, and then stabilized. Figure 3-4 Mountain Line Ridership Source: National Transit Database Start of Zero-Fare Demonstration Project 0 500,000 1,000,000 1,500,000 2,000,000 2013 2014 2015 2016 2017 2018 2019 An nu al U nl in ke d Pa ss en ge r T rip s Year

Fare-Free Transit Evaluation Framework 3-9 Operational Efficiency Fare-free transit may produce operational benefits, such as increased productivity and reduced dwell times. More specific survey and interview findings related to operations benefits of fare-free transit include:  Because fare-free transit almost always increases ridership it also typically leads to increased productivity, in terms of boardings per revenue hour. This and other efficiency measures can make transit agencies eligible for additional funding, such as Small Transit Incentive Cities (STIC) funding.35  Eliminating fare collection can improve service quality by reducing dwell times through efficient, all-door boarding, without the need for additional technology such as rear-door card readers.36, 37, 38 This increases reliability and can offset the increase in boarding time caused by increased ridership.  Because full fare-free transit eliminates fare collection, it also eliminates the possibility of fare-related conflicts between operators and passengers.  Full fare-free transit eliminates farebox and other fare collection equipment, which reduces the number of things an operator must operate, maintain, and monitor. This also reduces maintenance employees’ workload and eliminates the step of emptying the farebox when the bus pulls into the base.

Fare-Free Transit Evaluation Framework 3-10 LINK Transit’s Small Transit Intensive Cities Funding Implications Link Transit found in their fare-free transit evaluation that the anticipated ridership increase was expected to qualify the transit agency for approximately $275,000 in additional funding from the Small Transit Intensive Cities (STIC) funding program. STIC is a federal program designed to reward high performing small transit systems. The program provides funding to small urbanized transit agencies with population under 200,000 through evaluation of six performance metrics with established thresholds. Transit agencies qualify for $274,458 per metric threshold met or exceeded. Link Transit exceeded five out of six thresholds in 2019 (Figure 3-5). Figure 3-5 Link Transit STIC Funding Metrics and Thresholds, 2019 Metric Funding Threshold Link Transit Values Passenger Miles per Vehicle Revenue Mile 5.87 5.44 Passenger Miles per Vehicle Revenue Hour 100.70 105.42 Vehicle Revenue Miles per Capita 11.68 29.74 Vehicle Revenue Hours per Capita 0.74 1.53 Passenger Miles per Capita 78.55 161.76 Passenger Trips per Capita 11.98 14.77 Source: Link Transit Financial Health Fare-free transit can have financial benefits for transit agencies, such as reductions in fare collection costs, lower operating cost per passenger, and access to more stable funding. More specific survey and interview findings related to financial benefits of fare-free transit include:  Under full fare-free transit, transit agencies save on existing and future costs of collecting fares including producing and selling fare media; operating and maintaining fareboxes; counting, securing, and transporting cash; and upgrading fare technology.

Fare-Free Transit Evaluation Framework 3-11  Fare-free transit often results in lower operating costs and increased ridership, which reduces a transit agency’s costs per passenger trip.  Fare-free transit expands funding opportunities that could become more reliable than fare revenue, including grants specific to fare-free transit, grants for increasing operating efficiency, and community funding partnerships. 39, 40  By eliminating fare collection costs and the administrative costs associated with discounted fares, small to mid-sized transit agencies have been able to lower operating costs and qualify for additional state and federal grant funding for operating expenses.41  Transit agencies have used a wide variety of replacements for farebox revenue, including a corporate gross receipts tax, sales tax, municipal general funds, advertising, private partnerships, a dedicated transit tax or fee, or a combination of methods. Financial Efficiency at ART Area Regional Transit (ART) (St. Lucie County, FL) saw an increase in financial efficiency following the elimination of fares. Despite the foregone fare revenue, the ridership increase resulted in a lower subsidy per boarding (the operating cost not covered by fares or advertising revenue) (Figure 3-6). Figure 3-6 ART Subsidy per Boarding Source: St. Lucie County Community Transit, Fare-Free Transit Service Evaluation, 202042 Fare-Free Pilot Started $0 $2 $4 $6 $8 $10 $12 $14 2014 2015 2016 2017 2018 Su bs id y pe r B oa rd in g Fiscal Year

Fare-Free Transit Evaluation Framework 3-12 Community Impacts Fare-free transit has benefits for more than just transit agencies and their riders. These external benefits can range from short-term congestion reduction to long-term economic development and civic pride. Many of these benefits align with community goals and priorities at all levels (e.g., stakeholder, transit agency, municipal, state, federal) around equity, mobility, and sustainability. More specific survey and interview findings related to external community benefits of fare-free transit include:  Community members who do not ride transit can also benefit from the ridership increases caused by fare-free transit, as mode shift to transit may reduce carbon emissions and traffic congestion.43, 44 Some fare-free transit supporters describe mode shift to reduce carbon emissions as a key reason for supporting fare-free transit. Fare-free transit is also considered by some to increase the quality of life and public health of residents by reducing their exposure to local pollution, also through mode shift and reduction of single-occupancy vehicle use.45, 46, 47  Fare-free transit almost always improves mobility and access to destinations, which can increase land value for certain uses. This improved access can attract real estate development, which could grow a community’s property tax revenue, as well as provide public realm and infrastructure improvements.48, 49  Many transit agencies with fare-free transit report that their fare-free transit is a point of community pride—even to those who do not use transit.  Although fare-free transit reduces or eliminates fare revenue to a transit agency, the money passengers save is likely circulated elsewhere in the community, potentially increasing its impact.50

Fare-Free Transit Evaluation Framework 3-13 Local Economic Impact in Kansas City In 2020, KCATA worked with the Center for Economic Information at the University of Missouri Kansas City to measure the economic impacts of a proposed fare-free transit policy, ZeroFare KC. The resulting research showed that fare-free transit would have a positive impact on the quality of life in the Kansas City Region. Based on the researchers’ economic model, the Regional Gross Domestic product was projected to increase between $13 million and $17.9 million because of ZeroFare KC. This positive impact would be the result of the fare cost savings to riders, many of whom have annual incomes below $40,000 who would be able to redirect those savings towards real estate, hospitals, wholesale trade, and insurance (Figure 3-7). Figure 3-7 Estimated Spending in Top Four Categories Source: RideKC51 $0 $500,000 $1,000,000 $1,500,000 $2,000,000 $2,500,000 Real estate (rent, mortgages) Hospitals Wholesale trade (i.e., Costco, Sam's Club) Insurance carriers

Fare-Free Transit Evaluation Framework 3-14 Costs Despite the potential benefits of fare-free transit options, many transit agencies, riders, advocates, and other stakeholders see serious challenges and costs associated with fare-free transit, including fare revenue loss, a potential increase in service requirements, safety and security issues, and other trade-offs. These costs and drawbacks to fare-free transit are discussed in greater detail below. Access, Equity, and Mobility Negative or concerning aspects of fare-free transit on access, equity, and mobility are most often tied to the potential for funding trade-offs. Specific survey and interview findings related to access, mobility, and equity costs of fare-free transit include:  Some transit stakeholders think transit agencies should keep their primary focus on providing higher-quality service, especially to people with low-incomes or people living in underserved communities. To these stakeholders, the focus on fare-free transit is misplaced; some argue that making a service free is not as important as making a low-quality service better, even if it costs a fare.  Transit agencies should ensure that any fare revenue replacement funding sources are not regressive. The equity benefits of fare-free transit could potentially be lost if replacement revenue comes from a regressive source like a sales tax. Some advocates suggest a graduated income tax that ensures those who earn more pay more.  Eliminating fare revenue for some transit agencies may cause service cuts, which may significantly negatively impact transit riders’ mobility. In areas where the majority of transit riders are those with low-incomes or people of color, this may have negative equity impacts. Fare-free transit should not be used as an excuse for not improving service or ensuring access to transit (e.g., meeting Americans with Disabilities Act [ADA] requirements).  Those who benefit from fare-free transit the most do not always have the time and energy to advocate for themselves, so it can be difficult to measure their priorities. Transit agencies should partner with community groups to disseminate information to their audiences with a particular focus on those with low-incomes, people of color, older adults, persons with disabilities, and youth riders. Through this partnership, community groups should be compensated for their time. Additionally, it is important for transit agencies to acknowledge and respond to any feedback received.

Fare-Free Transit Evaluation Framework 3-15 Operational Efficiency Increased ridership from fare-free transit can challenge transit operations. Specific survey and interview findings related to operational costs of fare-free transit include:  The increase in ridership from fare-free transit can cause overcapacity issues on some trips. Some transit agencies have had a hard time supporting increased demand after a fare-free transit implementation. To support increased demand, some transit agencies need to purchase new vehicles, hire new staff, and operate additional service—all of which is costly.  Because full fare-free transit requires complementary ADA paratransit to also be fare- freeiii, transit agencies are concerned that the lack of fares will increase demand for paratransit trips to a level that cannot be supported by the transit agency, due to operational (i.e., driver and vehicle availability) and financial constraints. To counter this, some transit agencies tighten paratransit eligibility requirements, to reduce demand while remaining in compliance with the law.  Because hiring can be challenging for many transit agencies, many transit agencies are concerned about the prospect of needing to increase staffing to support fare-free transit.52, 53  Eliminating fare collection may restrict a transit agency’s ability to collect ridership data without fareboxes and fare media (e.g., origin-destination data). This may lead to increased costs for on-board surveys and other data collection methods.  Many transit stakeholders are concerned about the potential for or actual increase in disruptive riders on fare-free transit. These concerns, which typically revolve around people with mental health or substance abuse issues, are a major barrier to fare-free transit.iv  Most surveyed transit agencies that had implemented fare-free transit did not find disruptive passengers to be a major challenge after implementation, due to their overall small numbers. Some transit agencies have had success mitigating disruptive behavior with strong code of conduct policies, destination requirements, and policies that require disembarking at the final stop. iii Federal Regulation 37.135(c) requires that the paratransit fare for an ADA eligible rider not exceed twice the fixed-route full fare of a similar trip. FTA Circular 4710.1 clarifies that the maximum that may be charged for paratransit when the equivalent fixed-route fare is zero would therefore be zero as well. iv The 2016 TCRP Synthesis 121, Report on Transit Agency Practices in Interacting with People Who Are Homeless, identified that transit agencies do not have enough resources to meaningfully help homeless people riding the system. Partnerships with social services, ongoing outreach, and recognizing the humanity of individuals were identified in this report as ways to create a safe atmosphere on transit.

Fare-Free Transit Evaluation Framework 3-16  Transit agencies that measured the impacts to safety and security incidents after fare- free implementation either saw a slight increase or decrease in incidents per boarding. Many transit agencies experienced reductions in passenger conflicts due to the elimination of fare-related conflict between passengers and operators.54, 55  If transit agencies respond to disruptive passengers on full fare-free transit with increased policing, then this may result in the disparate impacts of overpolicing of riders who are people of color and low-income riders. The Rapid’s Challenges with Disruptive Passengers One example of a transit agency for which disruptive passengers was a significant challenge is The Rapid (Grand Rapids, MI). The transit agency provided fare-free transit on two routes, but reinstated fares on one line due to individuals experiencing homelessness utilizing the services for sheltering purposes and behavioral issues related to public intoxication. The Rapid did not have any type of code-of-conduct policy related to these issues in place and reported a desire for best practices from other agencies in dealing with disruptive passengers. Financial Health Long-term financial health is almost always the first concern facing transit agencies when considering fare-free programs. The impact of fare-free transit on costs and revenues varied widely across transit agencies surveyed and interviewed, depending on existing ridership, transit agency size, alternate funding sources, and previous fare systems. Specific survey and interview findings related to financial costs of fare-free transit include:  Full fare-free transit has proven more viable for small- to mid-sized transit agencies than for large transit agencies, as revenue from lower farebox recovery rate-systems is more easily replaced.  For larger transit agencies where fare revenue is a larger portion of operating revenues, considerable replacement revenue would be required for the transit agency to go full fare-free without cutting service. Finding replacement revenue is often cited as the largest challenge to providing partial or full fare-free transit on a high-farebox recovery ratio transit system.

Fare-Free Transit Evaluation Framework 3-17 Corvallis Transit System's Replacement Revenue The idea of implementing fare-free transit on Corvallis Transit System (CTS) was promoted by the Corvallis Sustainability Coalition as a strategy to make the city more livable. To replace fare revenue, the city implemented a Transit Operations Fee (TOF) on residents and businesses through their monthly utility services bill. During city council meetings, city and transit agency staff framed transit as a necessary public utility to which every member of the community should contribute. The transit agency credits this framing with the success of the program and reports high levels of community pride in fare-free transit service. The TOF is reviewed annually by City Council, so Council has the option to adjust the fee every year. Revenue at the “floor” level is approximately $900,000 annually, with 76% of the fee replacing the general fund and 21% replacing fares. The remaining 3% is intended for increases in service. The TOF also provides a source for local matching fund requirements for the purchase of new equipment. In addition to TOF contributions levied on a per-bed basis, Oregon State University (OSU) continues to support transit with a long-standing annual direct contribution of $130,000. In 2022, the fee was $3.44 per month for single family homes, $2.38 per unit in multifamily homes, and $0.054 per trip for non-residential customers. This consistent revenue source ensures long-term financial viability for the transit agency. Community Impacts There are considerably fewer negative community impacts from fare-free transit than there are benefits. One negative community impact that has occurred on some systems is an increase in public criticism of a transit agency, especially the narrative that the transit agency is providing ‘handouts’ to riders that don’t pay their fair share for the service they are using. Although some transit agencies have seen an increase in public criticism, they also typically see an increase in public compliments of the transit agency after fare-free implementation. The prevalence of different responses may vary based on the transit agency’s messaging.

Fare-Free Transit Evaluation Framework 3-18 This elevation of public discourse around a fare-free policy is not unique to public transit; major transportation policy changes across all modes often result in an increase in positive and negative public discourse surrounding the policy change. Challenges with Public Perspective in Ellensburg Some fare-free transit agencies, such as Ellensburg Central Transit (Ellensburg, WA), experienced a small but loud opposition early in the program, which eventually faded out as people experienced the new system. Mountain Line reported increases in community pride and ownership of the free-fare programs and that not charging fares is now an integral part of the system identity. More public pushback occurred in systems that reported more problems with disruptive passengers. For example, Sandy Area Metro (Sandy, OR) instituted a $1 fare on their previously fare-free transit after complaints from local businesses about destination-less riders. However, ridership fell dramatically, and began to negatively impact downtown businesses. The city then returned to mostly fare-free transit while keeping a small charge for out-of-town routes to mitigate some of the issues stemming from fare-free service.

Fare-Free Transit Evaluation Framework 3-19 International Fare-Free Transit Context Fare-free transit has been used as a tool to achieve sustainability goals, reduce congestion, and reduce the cost of transportation across Europe, South America, and Asia. To better understand the international context of fare-free transit, the research team reviewed a 2020 report, Why (not) Abolish Fares? Exploring the Global Geographic of Fare-Free Public Transport, that documented different perspectives on fare-free transit across the world. 56 The report found that more than 100 cities worldwide had made public transit free, mostly in Europe, with implementations ranging from small communities of around 10,000 residents to counties of over 100,000 residents. Key outcomes from the case studies include:  Full fare-free transit programs show that removing fares tends to substantially increase transit ridership  Full fare-free transit does not typically reduce car use unless combined with measures to increase the cost of driving, such as congestion pricing, parking pricing, or travel restrictions on personal automobiles  Additional benefits include additional access to jobs, increased public satisfaction with transit, opportunities for new funding, cost savings, and traffic safety More details on the outcomes from select countries are included below. Estonia In 2013, Tallinn became the first capital city in the European Union to provide free public transit after the city’s annual public transport satisfaction survey, which had previously shown that fare pricing was riders’ most common source of disapproval of the system. Just a year after the introduction of full fare-free transit, ridership increased by 14% while nationwide public transit mode share decreased in Estonia during the same period. Full fare-free transit particularly improved the mobility of low-income residents. In years since fare-free transit was implemented, survey respondents have reported improved access to employment opportunities and a significant increase in overall satisfaction with local public transportation.57 Because of the success of Tallinn’s free public transport program, Estonia began a push towards nationwide fare- free public transport in 2018.58 France Examples of fare-free transit from France show that eliminating fares can increase customer satisfaction and open doors for new funding sources. In Aubagne, France, implementing full fare-free transit eliminated €1.6 million of fare revenue, which

Fare-Free Transit Evaluation Framework 3-20 spurred the region to levy a transport tax on large business that generates approximately €5.7 million for equipment, maintenance, and labor costs. The subsequent system improvements produced a 136% increase in ridership. Similarly, a weekend-only fare-free bus program in Dunkirk, France was extended to weekdays to accompany a network redesign and fleet expansion. Poland Poland features 21 localities with fare-fare transit, the highest nationwide concentration in the world. Each of these transit systems abolished fares after 2010, representing a shift in Polish transportation policy. Poland is using fare-free public transit as a strategy to reduce private vehicle ownership and the pollution and noise associated with car usage. In Lubin County, fare-free transit was implemented as part of a municipal social policy to expand access to transportation services. Initial results have been dramatic, as ridership doubled after a year of fare elimination. In addition to ridership gains, Lubin has seen substantial savings due to eliminating fare enforcement.59 China While only three municipalities in China offer full fare-fare transit, early signs point to the policy’s potential. Gaoping is a small but densely populated city of 72,000 residents in Northern China. The government established free transit in 2013 to relieve congestion, encourage transit use, and discourage illegal motorcycle taxis. A 2015 study found that fare abolition increased transit ridership by 320 percent. Traffic safety greatly improved due to the subsequent mode shift, providing evidence that fare-free transit could be an effective solution for curbing traffic congestion in countries with high residential density.60 Changning and Kangbashi both offer full fare-free transit, as well. Changning’s 300,000 residents make it one of the biggest cities without a transit fare and serves as an international example for other mid-sized cities with similar transportation policy ambitions. The city of Kangbashi, built in anticipation of high population growth, eliminated the transit fare in 2015 to attract future residents.61

Fare-Free Transit Evaluation Framework 3-21 Fare-Free Transit Evaluations There are two primary time periods in which fare-free transit can be evaluated: before and after implementation. These evaluation types can generally be described as:  Feasibility Evaluation: Conducted before fare-free transit is implemented, to see if it is feasible for the transit agency. This type of evaluation typically focuses on estimating the likely benefits and costs of one or more types of fare-free transit.  Post-Implementation Evaluation: Conducted after fare-free transit has been implemented. This evaluation type usually analyzes how successful fare-free transit has been for the transit agency, including measured benefits and costs. Using this information, transit agencies may recommend continuing or stopping the fare-free transit implementation. Detailed descriptions of how both feasibility and post-implementation evaluations have been conducted by US transit agencies, as well as common elements included in both types of evaluations are provided below. Common Evaluation Elements Although there are several research papers that synthesize evaluations of partial and full fare- free programs in the US, there are no standard evaluation methods for feasibility or post- implementation evaluations. This research team’s review of completed evaluations, however, did uncover several common elements of fare-free transit evaluations. Most fare-free transit evaluations are focused around estimating or measuring the answers to key questions regarding fare-free transit. In TCRP Synthesis 101, the primary questions transit agencies ask were identified through a survey:  Is/was it cost-effective to eliminate the fare collection process?  What effect did/will fare-free transit have on ridership and system capacity?  What effect did/will fare-free transit have on service quality and customer satisfaction? To attempt to answer these questions, transit agencies used a variety of metrics (many of which are measured as estimates), including:  Cost of implementing the fare-free policy (e.g., lost revenue, new service, new vehicles, new facilities) on a per service area-capita basis  Change in farebox recovery ratio  Change in subsidy per rider  Change in overall service provided (e.g., service hours)

Fare-Free Transit Evaluation Framework 3-22  Savings from eliminating fare collection  Ridership Impact  Revenue sources and amounts  On-time performance  Fare-free transit’s impact on parking (e.g., utilization, cost, provision) Some transit agencies also used qualitative metrics to evaluate fare-free transit’s costs and benefits, such as:  Community feedback: compliments, complaints, and general sentiment  Bus operator feedback: benefits, challenges, and general sentiment  Issues with ‘problem passengers’ Feasibility Evaluation In general, only a few transit agencies have systematically evaluated the feasibility of implementing fare-free transit prior to implementation. Those that did complete formal evaluations of some kind usually conducted literature, peer, and best practices reviews, operational analyses, and financial evaluations. Some of the key financial issues that have been identified in feasibility evaluations are:  Many transit agencies struggle to find replacements for lost farebox revenue. Without this replacement revenue, some transit agencies decided against going fare- free, especially agencies with higher farebox recovery rates and larger operating budgets.  When transit agencies did identify alternative funding sources to make up for lost farebox revenue, they typically looked to taxes, municipal general funds, advertising, private partnerships, state and federal grants, or some combination of these and other methods.  Many transit agencies did not have a long-term alternative funding source secured when beginning fare-free transit. In the 2021 Northern Virginia Transportation Commission (NVTC) White Paper: Zero-Fare and Reduced-Fare Options for Northern Virginia Transit Providers, NVTC examined regional, national, and international examples of both full and partial fare-free and reduced-fare programs. As part of this assessment, the report identified several key guiding questions that may be good practice for future feasibility evaluations to consider:  Who is riding transit currently and who would benefit most from the fare options?  Is cost the determining factor for mode choice?

Fare-Free Transit Evaluation Framework 3-23  What level of ridership growth can be sustained without substantial added investments?  What are the costs of fare collection and their relationship to loss in revenue from fare-free implementation?  What funding options might become available under a fare-free system? Service Trade-Offs at Iowa City Transit Some transit agencies have recently evaluated a fare-free transit option and decided to maintain fares due to concerns about gaps in funding and the need to increase service to keep up with the additional demand. Iowa City Transit (Iowa City Area, IA) conducted a fare-free analysis at the beginning of 2020 as part of the Iowa City Area Transit Study.62 The transit agency opted not to go fare- free because staff felt the expansion of service to Saturdays for most routes and increased service frequency would not have been financially possible without farebox revenue. Fare-Free Pilot Programs In many cases, transit agencies have found that fare-free transit feasibility evaluations provide only high-level estimates of likely outcomes. With the uncertainty associated with these estimates in mind, several transit agencies found it prudent to advance a pilot fare-free transit program, giving the transit agency time to perform a blended feasibility and post- implementation evaluation that produces more information for decision makers. The structure of pilot programs may vary. Intercity Transit’s Five-Year Zero-Fare Pilot After the passage of a citywide proposition (Proposition 1) in Olympia, WA, Intercity Transit made a commitment to fulfill their nine community-defined priorities, one of which involves making fare collection more

Fare-Free Transit Evaluation Framework 3-24 efficient and in line with other peer agencies. After evaluating the impacts, the transit agency found that they were spending more to collect fares than they were receiving in fare revenue. In the end, the transit agency decided a fare-free pilot would serve as the most “economical, effective and fastest way” to achieve the proposition’s goals. In January 2020, the transit agency implemented a five-year pilot of fare-free transit. The length of the pilot was chosen to provide enough time to measure the full range of impacts of the policy, while not committing to a permanent change. In the first month of the pilot, the transit agency’s ridership grew by 20% in the first month compared to the previous year. Due to the COVID-19 pandemic, impacts of the pilot will be difficult to measure in the first few years, but the transit agency will continue to monitor progress. Post-Implementation Evaluation Only a few fare-free transit agencies completed an evaluation after the implementation. Of the transit agencies that performed post-implementation evaluations, the metrics used were largely operational and included:  Ridership  Revenue  Passenger or vehicle boarding times  Additional service needs  Change in passenger destinations  Public opinion When assessing public opinion and other, more qualitative metrics, transit agencies have used several tools, including informal operator feedback, on-board surveys, voter surveys, and online surveys. The post-implementation evaluations that were completed were noted as especially useful in guiding decision makers, such as transit agency leadership or government officials, on whether to continue the program.

Fare-Free Transit Evaluation Framework 3-25 Post-Implementation Evaluation Multiple surveyed transit agencies have continued to monitor ridership, transit agency operations, finances, and the community after implementation:  Area Regional Transit (St. Lucie County, FL) evaluated their full fare-free transit during a three-year pilot across various metrics including ridership, productivity, subsidy per passenger, and operating speed.  Cache Valley Transit District (Logan, UT) evaluates its fare-free policy every five years and looks at the qualitative and quantitative impacts of returning to fares.  DASH (Alexandria, VA) is conducting several customer surveys in the first year following implementation to gauge the impact of the new network and free fares.  Kansas City Area Transportation Authority (Kansas City, MO) is currently evaluating the community health benefits of the policy to leverage additional funding.  Link Transit (Wenatchee, WA) plans to evaluate the policy for effectiveness, potential operational aspects the transit agency plans to consider include ridership, paratransit demand, and passenger conflicts  Mountain Line (Missoula, MT) conducted a rider survey in the second year of the program to measure changes in ridership

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Recognizing the strong recent interest throughout the United States to consider and implement fare-free transit, decision-making tools are needed to help public transit practitioners evaluate fare-free transit.

The TRB Transit Cooperative Research Program's pre-publication draft of TCRP Research Report 237: Fare-Free Transit Evaluation Framework presents a framework that can be used by public transit practitioners to evaluate the potential benefits, costs, and trade-offs of implementing fare-free transit.

Supplemental to the report is an Infographic.

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