Introduction
Public transit is a public good, and if we’re serious about making transit an alternative to driving, it should be fare-free.
I start this essay with the strongest version of my argument because I don’t want you to come away with any illusions about how I think of public transit: it’s good for the environment, good for deconstructing the inhuman car-centric hell-scapes that are most American streets, and good for helping folks get around the region they live in. We should be doing everything in our power to improve public transit and to get more people to ride it, and one of the most important and effective ways to do that is to abolish fares.
This proposition probably seems radical if you’ve been paying for bus and train trips for your entire life, but I really don’t think it’s particularly out there. In fact, I think achieving fare-free transit in the Portland region wouldn’t even take that much work from a policy perspective.
So in this essay, I’m going to lay out a brief case for how and why we should make TriMet, the Portland metro area’s transit system, fare-free. I firmly believe that ALL public transit worldwide should be fare-free, but my experience as an activist and a transit rider is mostly limited to TriMet, which has been my primary way of getting around since 2000. I’d love to connect with activists who are fighting for transit justice elsewhere, but I’m not about to tell you how things could or should work in your area.
This case builds on the work of many activists and advocates in the Portland area. I don’t want to give anyone the sense that I think I’m the first person to credibly suggest a fare-free TriMet. I’m proud to be a long-time member and supporter of OPAL Environmental Justice Oregon & Bus Riders Unite, the union by and for TriMet riders. OPAL and BRU have led the way on lengthening how long a transfer lasts on TriMet to implementing the low-income fare equity program. They’ve been strong voices on demilitarizing our transit system and ensuring that it works for riders. This essays reflects what I’ve learned from my friends at OPAL, and what I’ve seen as a long-time transit-dependent TriMet rider. But while you’re here, take a second to join OPAL’s Up With Riders campaign.
Fare-Free Transit in Oregon and Beyond
First things first: not only would TriMet not be the first transit agency in the world to go fare-free, it wouldn’t even be the first in Oregon: both Corvallis City Transit and Wilsonville’s SMART system are fare-free. Let’s review a few of the local and international models for fare-free transit, to highlight the different ways a few regions have approached this issue:
Wilsonville/SMART
Wilsonville’s transit system is known as SMART, short for South Metro Area Rapid Transit. It’s a partially fare-free system: most of its routes are free for riders, except for express routes to and from Salem & Portland, which charge between $1.50 and $3 a ride. If your bus stays within the City of Wilsonville, it’s free to ride. SMART is operated by the City of Wilsonville directly, and the service is primarily paid for through a local 0.5% payroll tax on employers, as well as outside grant funding. Near as I can tell, SMART has been fare-free from its inception, and only began charging premium fares on inter-city routes in 2005.
Corvallis/CTS
The City of Corvallis operates a system called CTS, also known as Corvallis City Transit, which is operated by an outside contractor but funded by the city. In February 2011, CTS abolished fares after passing a Transit Operations Fee (TOF), a monthly fee charged to utility customers who live in the City of Corvallis. As of January 2019, the fee worked out to about $3.16 per month for folks who live in single-family homes, and $2.18 per month for folks in apartments. It’s also charged to commercial and industrial customers based on the type of business they operate. Everyone sees their monthly charge on their water bill.
Going fare-free had a major, positive impact on ridership in Corvallis, and we’ll take a look at that a little later when we talk about the potential impact of fare-free transit on TriMet.
Tallinn, Estonia
In 2013, the capital of Estonia, Tallinn, partially abolished fares on public transit after a referendum in which 75% of voters approved a fare-free system. Notably, you must be a resident of Tallinn to take advantage of free fares; tourists are still required to pay them. But if you are a registered Tallinn resident, you pay about 2 euros for a “green card” which gives you the right to ride transit for free.
This registration scheme is interesting. In the wake of adopting their fare-free system, Tallinn saw an increase of 25,000 officially-registered city residents. It’s also led to some friction with tourists, some of whom object to paying more than residents for tram and bus rides. But even though the fare-free system has been criticized as a poor use of public money, it’s been successful enough that the entire country will adopt a partially fare-free system.
One fact to hold on to for later: according to the BBC, a third of Tallinn’s transit revenue came from fares — that’s a larger share than the amount of TriMet’s revenue which comes from fares.
Comparing these three examples to Portland
One things to be clear about, because I know critics of fare-free transit will mention it: all three of the cities above are considerably smaller than the population served by TriMet. According to TriMet, their service area includes a population of about 1.8 million people — versus 441,000 registered residents of Tallinn who have access to fare-free; almost 60,000 people in Corvallis; and about 25,000 in Wilsonville. Providing fare-free transit in Portland would cost more in raw dollars than any of these examples. But the reality is, the question is not whether the funding sources exist to pay for this — they do; after all, TriMet was easily able to find $11 million to build a new transit jail, and they’ve got no shortage of money for their pet projects, like the WES boondoggle. The question is, do we have the political will to make it happen?
Fares and Other Ways TriMet Makes Money
In TriMet’s 2020 adopted budget, the agency assumes that 16.1% of their revenue will “passenger revenue,” which is the wonky industry term for fares. 60.1% of their funding comes from payroll taxes, and 19.6% comes from state and federal grants. It’s important to start with these numbers, because we need to establish from the get-go that most of TriMet’s revenue comes from sources other than fares. Most of your trip on TriMet is subsidized by other funding sources; all I’m proposing is that we subsidize more of it.
So let’s talk specifics: $110 million. That’s the amount of passenger revenue — fares — that TriMet is expecting to pull in during the 2020–21 budget cycle. That’s the base amount we’d need to raise to pay for the current amount TriMet’s collecting in fares, although as I’m going to argue later, I think it’s a little more complicated than that, because administering a fare-based system has direct costs as well, and we can expect that ridership would increase once TriMet goes fare-free. But that $110 million a good jumping-off point for the amount of money we’re talking about.
Other Funding Sources
Oregon Revised Statutes Chapter 267 governs mass transit districts, of which there are two (and a half) in Oregon: TriMet, Lane Transit District in Lane County, and the Salem/Keizer Cherriots system (which is halfway to becoming a mass transit district, a long story that isn’t really relevant here). Let’s look at ORS 267.300, which gives these mass transit districts authority to raise the funds to operate their service. I’m going to copy in the legal-ese from the statute, and then unpack what each of these means:
(a) Levy of ad valorem taxes under ORS 267.305.
This means a property tax on property within the TriMet service district. This can be used for both “operations” — which means everything related to the actual operation of the system, like wages & benefits for drivers — and “capital expenditures” — which means the construction of new infrastructure like MAX lines, bus stops, etc.
(b) Service charges and user fees collected under ORS 267.320.
This means fares, for the most part.
(c) Use of the revolving fund authorized under ORS 267.310.
This is a little wonky, but basically gives TriMet the authority to pass a limited property tax to fund “the planning and construction, acquisition, purchase or lease of a mass transit system”
(d) Sale of bonds under ORS 267.330 to 267.345.
This is one of the primary ways TriMet funds its capital construction department to build new bus and MAX infrastructure. A bond is a fancy kind of loan: TriMet essentially borrows money from certain investors by selling them “bonds,” which are a promise to use future revenues to pay back the bondholders plus a little interest. It’s like a savings bond, if you’re familiar with those, but at a much larger, institutional scale.
(e) Levy of business license fees under ORS 267.360.
TriMet could impose “a fee on any business, trade, occupation and profession carried on or practiced in the district”
(f) Levy of a tax measured by net income under ORS 267.370.
TriMet could impose up to a 1% income tax on all residents and businesses within the TriMet service area
(g) Levy of a tax measured by employer payrolls under ORS 267.380, 267.385 and 267.420.
This is TriMet’s main source of revenue now: your employer pays a payroll tax, sort of like how Social Security taxes are paid. And under a law passed by the Oregon Legislature in 2017, you also pay an employee payroll tax, which is a fancy way of saying they deduct money from your wages to pay for transit. It appears on your paycheck as the “transit tax,” if you’ve noticed it.
(h) Use of funds accepted under ORS 267.390.
Federal funds.
(i) Short-term borrowings under ORS 267.400.
Loans against guaranteed future funding.
(j) Levy of a tax measured by net earnings from self-employment under ORS 267.380 and 267.385.
The self-employment tax paid by independent contractors and other self-employed folks.
That’s a lot of funding options! And yet almost all of TriMet’s revenue comes from payroll taxes, state & federal grants, bonds to pay for new construction, and fares.
Fares Cost Money
Since fares are classified as “revenue,” it’s tempting to think of them as just money coming into the agency. But it costs money to administer a fare-based system:
Fare Inspectors
To enforce the fare system, TriMet pays for its own in-house Fare Inspectors and Customer Experience Agents, who are involved with fare enforcement actions on bus and MAX. The agency has the equivalent of 12 in-house fare inspectors (who wear white shirts), for a cost of $806,432 in salary according to the 2020 Adopted Budget. They also pay $78,013 in salary to their Fare Enforcement Manager to coordinate all of this. Customer Experience Agents (who wear blue shirts) have a larger portfolio than just fare enforcement, so it’s unfair to consider them just a part of this fare apparatus, but I’ll note that the equivalent of 11 full-time Customer Experience Agents make $522,705 in base salary.
Even leaving out the blue-shirts, that’s just under $900,000 in salary costs for fare enforcement.
Transit Police
TriMet also funds the Transit Police Division housed in the Portland Police Bureau, which takes police officers from across the TriMet service area and tasks them with TriMet-related issues. These are the folks who work together to check fares on the TriMet system, write warnings and tickets for people who ride without fare, and who sometimes detain and interrogate individuals in the transit jail. The budget makes it a little hard to figure out exactly how much TriMet pays Portland Police for this service, but we can safely assume it’s the lion’s share of the $15.1 million in approved Security Services in the current budget.
I don’t for a second think that abolishing fares would lead to TriMet entirely ending its support for the Transit Police Division, especially because they also spend money on K9 police and “anti-terrorism enforcement,” which indicates how deeply ingrained law enforcement culture is within the agency. We should work toward the abolition of this militarized law enforcement on transit just as we should work toward the abolition of all police and prisons. But even if you keep some police presence on the system, you can reduce the amount you spend on Transit Police considerably, and save millions of dollars.
Ticket Vending Machines and On-Bus Fare Systems
The ticket vending machines (which TriMet internally calls “TVMs” for short) at MAX stations and transit centers, as well as the ticket printers and Hop card readers on buses, all cost money to build, operate, and maintain. For example, according to documents I received when I worked for the Amalgamated Transit Union, TriMet spends almost 20 cents per ticket for the new tickets you get out of TVMs, which you can use with the Hop card readers. In their 2020 budget, TriMet allocates $1.3 million for materials costs overall for tickets/passes (basically, this is what they’re spending on the rolls of tickets for each vending machine or bus ticket printer, and the cost of month passes/stickers).
The combined cost of the personnel and materials for their Fare Revenue Department is $10.9 million.
TriMet Ticket Office
The TriMet Ticket Office in Pioneer Square is going to be “upgraded” according to the 2020 budget, at a cost of almost $1.4 million. Abolishing fares eliminates the need to maintain a ticket office separate from existing customer service.
I’m Not Saying We Should Put Workers Out of Their Jobs
I used to work for the union representing TriMet workers, so I feel honor-bound to say that I am NOT trying to put the hardworking frontline employees of TriMet out of their jobs (although I’m absolutely trying to put the Transit Police out of their jobs). I believe that all of the folks who currently work on fare enforcement should be transitioned to other jobs within the agency over time as equivalent positions come open, or be allowed to retire early with no penalty to their retirement security, in a just transition to a fare-free system. That means that you wouldn’t see the same kind of cost savings by going fare-free that you would by just laying these folks off outright. But that would be a cruel thing to do in an agency that’s already pretty dang cruel to its front-line workers.
My point here is that, because a fare-based system costs money to operate and administer, it’s not fair to look at the $110 million in “passenger revenue” as simply a source of funding. It also requires many millions of dollars in expenditures.
So, How Would We Fund a Fare-Free TriMet?
The biggest objection to fare-free transit, and one I’ve personally heard TriMet executives use in conversation, is that it would be prohibitively expensive to abolish fares. But as we’ve just seen, most of TriMet’s money comes from sources other than fares, and they don’t make use of all of the funding options available to them. Plus, it costs money to operate a fare-based system, and you can gradually — and humanely, in the case of frontline workers — eliminate those costs by going fare-free, depending on how you implement it.
The other thing I haven’t gotten into is how much money TriMet wastes in its capital construction program, which is the fancy term for the program that builds new MAX lines and physical transit infrastructure. Although the agency likes to claim that capital funding can’t be mixed with operations funding, that’s just not true. Every year, the agency transfers money between the funds in creative ways; in the 2020 budget, for example, they set aside over $31 million as “Operating Resources Dedicated for Capital.”
TriMet’s recent history with capital constructions projects leaves a lot to be desired. WES — the diesel-powered commuter train between Beaverton and Wilsonville, which you would be forgiven for forgetting about — cost $166 million to develop, and has never come anywhere close to its projected ridership numbers. Both the Orange and Green MAX lines are in a similar boat, having cost large amounts of money without meeting their ridership goals. The new SW Corridor, sometimes referred to as the “Purple Line,” is shaping up to be a similar waste of billions of dollars.
My proposal here is simple: we should fund a fare-free TriMet primarily through a graduated personal/business income tax, an increase in the employer payroll tax which already funds operations, a reduction in the costs of administering a fare system, and a rededication of capital expenses to operations.
The Effects of Fare-Free Transit
Okay, that’s the wonky nuts and bolts of funding. The upshot is that TriMet has the money to pay for a fare-free system, and we’d really just need to figure out how to reconfigure the budget to make it happen. This wouldn’t be nearly as hard as many folks seem to think it is. But now I want to focus on what fare-free does for transit systems:
Fare-Free Improves Ridership
This is probably intuitive to anyone who rides public transit: if you make the system fare-free, more folks will ride it. This is one of the major effects that’s been seen in places which have gone fare-free. For example, in Corvallis, ridership increased by 37.9% in the first year the system went fare-free. In Tallinn, Estonia, ridership was up 14% within the first 9 months of the system going fare-free. In Merced, CA, a short-term fare-free experiment increased monthly ridership by nearly 27%. When TriMet implemented Fareless Square in 1975, trips within that area increased 811% over the next 3 years.
This also makes economic sense. I’m not going to get into a long discussion of “elasticity,” the way economists measure the interaction of the price of something vs. the demand for that thing, but the idea is relevant here. According to the Oregon Department of Transportation, of all agencies, a 1% decrease in fares is expected to yield a 0.4% increase in ridership. You’d expect, then, that a 100% decrease in fares would yield a 40% increase in ridership — which closely matches the Corvallis example.
This is especially important because TriMet’s ridership has been falling for years. In every fiscal year since 2015, the raw number of people boarding a TriMet bus or train has fallen. That means that today, fewer people are riding TriMet than 4 years ago — and when you consider how Portland’s population has grown in that time, it’s even worse. In a healthy transit system, you’d expect to see ridership increase by at least the same rate as population growth, and you’re always hoping for bigger increases than that. If we want more folks to ride TriMet, going fare-free is a good way to do that.
Fare-Free Speeds Up Service
This one is easy to understand: if you remove the whole process of putting in cash and getting a ticket, or tapping your card on the Hop reader, you save time in the boarding process at each stop. That reduces what we transit nerds call “dwell times,” the amount of time a bus or train is parked at a stop while boarding/deboarding riders. Additionally, eliminating fares means we would be able to move away from riders getting onto buses via just the front door, speeding up the flow of riders and thus speeding up buses and trains.
Arguments Against Fare-Free Transit
Most of the arguments I’ve seen against fare-free transit revolve around a variation on something fittingly called the “free rider” problem. The idea is that, by making transit fare-free, riders will value the service less, and behave poorly on buses and trains (i.e. by tagging vehicles with graffiti, eating and drinking on the service, etc.). I’ve never found this argument particularly persuasive, in part because there are ways to implement fare-free that make it clear that riders are still paying for the service in other ways, for example, Corvallis’ inclusion of the transit fee on everyone’s water bills. Beyond that, I also think that folks can correct others’ behavior in community-oriented ways on transit; speaking personally, I’ve never known my fellow riders to be shy about telling someone to turn their music down.
The other big objection to fare-free transit is fairer, and that’s the downside of increased ridership. After all, if you’re on a standing-room-only downtown bus during rush hour, the idea of packing in 40% more riders probably seems impossible. My response to this objection is on the glib side, but the answer is to ensure that service is increased for specific trips where buses are near or at capacity, decreasing the time between buses and trains (which is aided by the decrease in boarding times), and other service enhancements like dedicated right-of-way and prioritizing transit at traffic lights. There is a cost to all of this, but I remain convinced that the question is not whether the resources exist, but how they’re being spent currently.
Conclusion
Fare-free transit improves ridership. It makes service smoother. And it ensures that public transit serves its basic function: moving our cities, towns, and everywhere in between.
What I’ve outlined above is (obviously) not a campaign plan or even a full analysis of what it would cost to abolish fares on TriMet. Rather, I’m trying to make the case that a fare-free system is desirable, it’s doable, and it’s not nearly as complicated as many folks think.
Achieving a fare-free TriMet wouldn’t be easy, to be clear. It would take the dedicated efforts of activists, everyday transit riders, and the community as a whole, and it would require pushing back on TriMet’s increasingly corporate culture. But guess what? That energy and skill exists in this community. There are a lot of folks who are smart and passionate who are already fighting to make TriMet better every day. If we come together to demand it — and craft a plan a little more specific than what I’ve been able to manage here — we CAN achieve a fare-free TriMet. And as we watch the effects of climate change impact communities across the world in disastrous ways, we are morally obligated to work toward making public transit free.
