With surcharge looming, fare media liability could declineBy
Over the past few years, as the MTA’s fiscal outlook has remained bleak, news coverage has often focused on its fare media liability. Each year, the MTA recoups around $50-$60 million in unused fares when riders purchase pay-per-ride cards but fail to zero them out. As the discount math gets tougher, the amount recovered increases.
Amidst last year’s fare hikes, I reported that the MTA still expected to recover $52 million in fare media liability this year, and today, Jim O’Grady at WNYC verifies that figure. Interestingly, though, in his piece, O’Grady talks about the impact of the $1 surcharge.
The MTA hasn’t yet announced when it will implement the $1 surcharge on new MetroCards, but the authority believes the fee will lessen its fare media liability recovery figure. As straphangers have an incentive to zero their MetroCards, the MTA will see that total go down, but on the flip side, the $1 surcharge will generate around $20 million in revenue while reducing the agency’s fare collection costs. The authority currently spends around 15 cents of every $1 in revenue on fare collection costs, and a decrease of even one cent can save the authority hundreds of millions of dollars a year. They’ll forego the unspent rides in exchange for a more efficient collection system.