It’s fare increase time again at Metra

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“It’s become a Chicagoland tradition that every year around this time, transit riders cross their fingers and hope they won’t be hit with service cuts and fare increases. Unfortunately, it looks like the tradition will continue this year.” -Lee Crandell to the Metra board on October 14, 2011. 

Lee Crandell is right, but the tradition is not something Metra, or any other Chicagoland transit agency, has much control over.

Metra staff has proposed fare increases to the board who have accepted the proposal and will submit them to public hearings in November (schedule at the end). The staff first proposed fare increases to the board on September 16, 2011. They proposed a revised fare increase at the October 14, 2011, meeting, at which Crandell spoke. The alternative to fare increase was one of two service reduction options.

In addition to the fare increase, staff proposed to change the validity period of 10-ride tickets and monthly passes, the refund policy for tickets and passes, and add a fee to process refunds. Another element in the proposal was to cut the weekend pass’s validity period to one day instead of both or all days. (Board member Jack Schaffer asked Metra CEO Alex Clifford how much money Metra would save if this was the new rule and Clifford responded that he didn’t know; October meeting minutes are not available.)

I’ve presented a summary of these changes in fare policy in a section below.

Before the staff proposed their fare change recommendations to the board in September, they explained the principles they held to create them and asked the board members for their opinions on the principles they adopted. The board seemed to be in agreement over them. These principles are presented in page 37 of the October presentation to the board (download the PDF). One board member, Mike McCoy, stated at the September board meeting that these principles should be adopted as Board policy. I think it’s wise to have a formal policy that guides staff members each year on how to evaluate fares and develop fare changes.

Principles for fare policy

This is a sample of the principles the staff developed, along with my reactions. 

• “Consider regular fare adjustments that ensure a balanced budget, keep pace with inflation, and avoid significant, infrequent fare increases” – Metra has typically raised fares only after several years; in the past decade it’s raised fares 4 times. In the previous decade it raised fares 1 time. (See page 37 of the September board presentation.)
• “No diversion of capital eligible funds to operating budget” – This practice must end at all transit agencies in the country. This is not a sustainable way to cover shortfalls. Think of it this way: Former Mayor Daley sold Chicago parking meters to cover a shortfall in the City’s budget. Does the City budget still have shortfalls? Yes, several that a one-time cash infusion of $1 billion couldn’t cover.
• “Evaluate fare policies of sister agencies and peers” – I don’t think this is very important. Metra’s customers most likely do not know who are Metra’s peers, nor do they care about the price of a ticket on the Long Island Railroad (New York), or the costs of operating Metro North (Connecticut, New York, New Jersey). It’s useful to look to other agencies to see what ideas they have to reduce costs or how they are proposing fare increases to their passengers, but comparing Metra to peers in order to see who offers a more advantageous trip to their customers is pointless as they are not in competition. Board member Schaffer said that “he frankly does not care what Metra’s peer agencies are doing” when it came to comparing Metra staff’s proposal to reduce the validity period of a 10-ride ticket (see page 15 of September meeting minutes).

Why does Metra have to raise fares

Lee Crandell, a manager for the Riders for Better Transit campaign at the Active Transportation Alliance, spoke at both the Chicago Transit Authority (CTA) and Metra board meetings this month. In his speech to the Metra board, he sympathized with them, acknowledging that it’s not Metra’s fault that it must choose between cutting service (when it’s slowly rising) or raising fares.

Criticizing Metra in this situation is a normal reaction—and certainly on behalf of the riders we represent, we urge you to explore every possible efficiency to prevent fare hikes or service cuts—but ultimately, it’s our elected leaders who hold the purse strings and decide whether our transit agencies will have enough funding to make ends meet. Transit is significantly under-funded because our elected leaders at the local, state and federal levels have put it on the back-burner. [Read the full comment.]

The Metra staff and board do not control what subsidy commuter rail receives to provide a vital transportation service to hundreds of thousands of Chicagoland residents each day; Money flows with fewer restrictions to the Illinois Department of Transportation when it comes to building and maintaining highways. But highway builders don’t answer to boards or have farebox recovery requirements (the portion of operating costs that must be covered by tickets). Transit and urban planners recognize that we cannot afford to continue building highways, even if that’s what most people use to get to work and shopping. There’s a cost to congestion and we’re all paying for it with pollution and lost time.

Highways are not supported as much by user fees as transit is. An enormous portion of roads are paid for by general revenues while many people believe gas taxes pay for a majority of road building and maintenance – they don’t. Transit is supported by sales tax, user fees (tickets), advertising, and other revenue sources.

The Urbanophile calculates the benefit of providing transit:

 In Chicago, which is gearing up for another round of fare hikes and service cuts, the cost of congestion avoided due to public transit is about the same as the combined operating budget of all regional transit agencies. Chicago transit is effectively self-funded in terms of benefits delivered to motorists alone.

According to the Texas Transportation Institute’s 2010 Urban Mobility Report (TTI UMR), which the Urbanophile is referencing, ranks Chicago as having the highest congestion cost in the United States, at $8.2 billion*. (Some controversy surrounds the TTI’s UMR in that it is used to support the expansion of roadways. The group CEOs for Cities published a critique, Driven Apart, that “reveals how sprawl is lengthening our commutes and why misleading mobility measures [TTI’s UMR] are making things worse by suggesting more highways are the solution”.)

Who can fix this

I wrote in August that some cities’ residents vote to tax themselves to support transit. We do that here in Chicagoland, but the legislature imposed the tax. In Phoenix and Los Angeles, residents imposed the tax on themselves by approving a referendum.

Another idea is to tie transit agency revenues to property taxes instead of sales taxes. Property values are not as volatile as consumer product prices and may do a better job of providing a sustainable source of funding for transit. The Illinois legislature would have to make this change.

The Illinois legislature can reduce the subsidy to building and maintaining roads and transfer this subsidy to increase funding for transit.

All of these ideas are in addition to the constant discovery of new efficiencies and new grant opportunities from the federal government. Several Metra board members stressed this in the September meeting, yet there may be a theoretical limit to maximizing revenue and reducing costs.

For now I recommend that you join the Riders for Better Transit campaign to stay in touch. And continue to educate yourself on the complexities of transportation funding in Chicago and the United States (it’s equally complex in any city in the country). Also contact the Governor and legislators about Metra and CTA fare increases and service cuts using the Riders for Better Transit action alert webpage.

Summary of fare policy changes

• Price of weekend pass will not change
• One-Way Ticket – Valid for 14 days, including date of purchase; No refund (currently valid for 1 year and can be refunded at any time until expiration, or can be replaced with a new ticket, no refund fee)
• Ten-Ride Ticket – Valid for 1 year from date of purchase; Refundable 3 months from date of purchase; May be refunded with up to 9 rides used;  Refund subject to $5 handling fee (currently refundable up at any time until expiration, no refund fee)
• Monthly Ticket – Valid through end of month; Refund subject to $10 handling fee (currently valid through end of month until next weekday at 12 PM; no refund fee)

There are other changes: see page 39 in the October board presentation.

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The rules on how this ticket can be used may be changing. The board will vote on November 11, 2011, to accept or reject the fare increases and changes to fare policy. Photo by Eric Pancer. 

Public hearing schedule

There are eight public hearings schedule to lend Metra your thoughts on the fare increases and changes in fare policy, four each on November 2nd and November 3rd, all from 4-7 PM. There is one in Chicago (at Metra headquarters, 547 W Jackson Blvd), two in suburban Cook County, and one each in DuPage, Kane, Lake, McHenry, and Will counties. View the details in this Google Fusion Table or in the interactive map below.

In order to educate passengers on the changes, Metra distributed a special edition of its monthly newsletter (available in all train cars), On The Bi-Level. Paul Dailing of Mokena Patch dissects the scenarios and dollar figures presented in the newsletter; he finds it odd that Metra uses suspect or inflated numbers because even with accurate variables it would have come out the winner when compared to driving downtown and parking.

See a related story on Steven Can Plan about Metra’s marketing and assumptions about people’s familiarity with Metra’s service as an alternative to driving downtown. 

*Congestion cost is defined as “Value of extra travel time (which we call delay) and the extra fuel consumed by vehicles traveling at slower speeds. Travel time has a value of $16.01 per person-hour and $105.67 per truck-hour in 2009. Fuel cost per gallon is the average price for each state.” From the Urban Mobility Report FAQ page.

Top photo: A Metra train crosses Kinzie Street near Ogilvie Transportation Center, by masMiguel.