Fare Hike ’13: An end to the discounts?By
Let me pose a question: Why does the MTA hand out discounts on its pay-per-ride cards? Is it to reward transit riders? To encourage riders to stock up on rides to cut down on potentially long lines at the vending machines? Is it a relic of another era in which the MTA had to encourage its customers to switch from tokens to MetroCards? Mediate on that as we ponder a world without discounts.
Earlier this morning, in front of a crowd of high-rollers at a Crain’s New York breakfast, MTA Chairman and CEO asked and answered his own question about the upcoming March 2013 fare hike. While the authority will release the details next month, Lhota’s comments suggested the days for discounts — steep or otherwise — are nearly over. After internal debate about the topic, the MTA is likely going to ask the public to discuss ending fare discounts for pay-per-ride swipes.
According to Lhota, the MTA captures on average $1.63 per swipe in revenue from all riders who pay while the base fare is $2.25. With a meager seven-percent discount and a need to find $450 million, the MTA may wipe out bulk discounts entirely. Such a move, Lhota said, will go “a long way toward capturing revenue.” Plus, he asked of the current percentage, “do we really need to go to that level of a discount?” It’s unclear what such a move would mean for unlimited card users.
Once upon a time, the discount meant two free rides for every 10 purchased, but these days, we’re down to seven percent. Is it low enough for the MTA to eliminate entirely? The Straphangers Campaign, for one, isn’t too sure. Nothing that “eliminating the discount is no different than a fare hike” — which, of course, is the point — the Straphangers worried that doing away with the discount would penalize low-income riders. “The 7% discount on $10 purchases is more accessible to low-income riders,” they said in a statement, “while the seven-day ($29) or 30-day ($104) are a lot of money to have to put up front.”
Of course, the MTA wouldn’t be doing away with pay-per-ride options entirely; they’d just be doing away with the savings of about 15 cents per ride. Unfortunately, low-income riders aren’t in a position to seek out alternate transportation modes over 15 cents per swipe anyway, but yes, as with any fare hike, they’ll bear a heavier burden.
The Straphangers also say that “providing incentives to make bulk purchases of transit encourages greater subway and bus ridership.” That’s long been the party line from anyone regarding MetroCard discounts, but Lhota said he felt subway riders would buy in bulk anyway. Buying 17.75 rides just to get the 18th and 19th for free isn’t incentivizing too many straphangers, and the system’s heaviest users from just about any income bracket will continue to look to unlimited ride cards.
Ultimately, though, a fare hike is a fare hike is a fare hike, and to generate the revenue the MTA is going to look to raise what we pay for the cost of a subway ride. The full proposals will be available in October, and the public hearings will take place in November. Only then we will learn just what that seven percent discount means to New Yorkers.