Time-Based Fares for the TTC? Maybe in 2015

The agenda for the TTC Board’s meeting on January 28, 2014, includes a report on time-based fares.  The report cites many advantages for a shift to this form of fare including:

• ease of understanding by riders and clarity for enforcement by operators and fare inspectors;
• simplicity of implementation on PRESTO;
• simplicity for routes using all-door loading where transfers would not be inspected on entry;
• compatibility with fare policy on most other transit systems.

The downside, such as it may be, would be a loss of revenue relative to the current fare structure of up to $20-million annually (a bit under 2%).  There are additional concerns related to a transitional period before PRESTO takes over the overwhelming majority of all fare transactions, such as the increased value of transfers issued freely in the subway which would become limited time passes.

Management recommends that time-based transfers be considered as part of the 2015 budget.  This would leave a final decision on such a change to the next Council and TTC Board.  Other proposed changes include discontinuing time-based transfers on St. Clair if a system-wide policy is rejected, and formulation of a policy for locations where time-based transfers would be allowed in future as an offset to major local construction activity (e.g. on Eglinton).

This is quite a refreshing report about TTC fare policy because it proceeds from the basis that this is something that can be done, that many other cities already have implemented, and which has benefits and costs that should be weighed as part of any decision.  We do not hear about all the money the TTC would be wasting on people who would obtain more transit for lower fare.  The contrast with the typical portrayal of Metropass users is quite astounding.

The report notes that only about 10% of existing trips on the TTC involve the use of a paper transfer because more than half the riders use passes, and many trips involve connections where there is no fare barrier and therefore no need for a transfer as proof of payment.  Trips that now involve multiple fares (e.g. a short there-and-back trip, or a multi-legged trip with stopovers) would be cheaper for those riders who do not now use passes, and who do not already organize their journeys to optimise transfer use.  (As someone who has used a Metropass since they were introduced in May 1980, I still miss the challenge of getting the most out of one fare.)

An obvious point the report completely misses is that a time-based fare would give the single fare more value in that it would buy a few hours of unlimited riding rather than a single connected trip.  This is particularly important for people who tend to pay their fares one at a time.

Another effect would be that Metropass users, now portrayed as taking an almost embarrassingly high number of “rides”, would be seen as using far fewer “fares” because some trips now counted as separate would now be part of one connected journey.  The concept of “lost revenue” to passholders would become even more difficult to justify in an environment where the right to use transit was sold by time, not by trip segment.

Indeed, the TTC will have to recalibrate how it counts “riders” and “fares”.

Transfer abuse is estimated to be the single largest source of “lost revenue” today.  I put that in quotation marks because transfers, and the inventive ways riders use them, have been around for over a century, and the “loss” was never money the TTC might have collected in the first place.  It is part of the cost of doing business, and indeed is a “cost” brought on by the obvious incentive riders have to maximize the return for their fares.

The TTC claims it loses almost $15m to transfer abuse each year, but that is not real money they could recoup without a large investment in enforcement.  The lost fares represent under 1.5% of the annual total (7.6-million fares out of 540-million).

The cost for a two-hour, unlimited use fare is estimated at $20-million annually.  This would have to be made up by additional subsidy (less than 5% over the current operating subsidy level), by an extraordinary fare increase (about 2% based on $1-billion in annual fare revenue) or by some combination of these.

Modified schemes with more restrictive policies would cost less, but they have drawbacks:

• a shorter time period such as 90 minutes would catch more riders and trigger second fares;
• restrictions on where a transfer could be reused would be confusing and would not completely eliminate arguments between staff and riders about transfer validity.

One aspect the report does not mention is the problem of delays and short-turns.  What happens if someone’s trip is pushed beyond the time limitation because of erratic TTC service?  In the case of manual fare inspection, there is at least a chance for a conversation to explain the circumstances, but where the fare check is automated, this is much more difficult.  Should riders be penalized with extra fares because of poor TTC service?

Time-based fares will be essential for regional fare integration.  A rider should be able to “buy” the ability to ride transit and change between routes regardless of which company operates the bus.  There could be a premium for including GO trains in a journey, but it should not be a full additional GO fare.  (This would make system-wide the existing co-fare practice between various 905 transit systems and GO.)  All of this is comparatively simple (from the technology, if not the political perspective) with a smart card fare system, and all but impossible with the TTC’s current transfer rules and fare collection.

Discussions of time-based transfers go back almost a decade.  The report includes excerpts from studies in 2005 and 2009.  The 2003 Ridership Growth Strategy looked at fare-by-distance and at time-of-day-based fare discounts, but not at transfers as short-term passes.

This is not a new idea, but one that until now has always been sandbagged by the combined effects of “we can’t afford it” arguments and an attitude that any fare reduction is “lost money” for the TTC, not an improvement in the system’s quality and attractiveness for riders.

A thorough discussion of this is long overdue and, but for the Ford interregnum, we might have seen this a few years back as part of the TTC’s concept for smart fare cards even without PRESTO.

The shift to time-based transfers, in effect to short-term passes, would complete the TTC’s move away from a one trip, one fare model.  This would increase transit’s attractiveness for casual or irregular users whose travel is penalized, compared to pass holders, by that outdated model.

Mayoral and Council candidates would do well to consider the benefits of this system, and look to implementation in 2015 at the latest.