Home Fare Hikes MTA continues to anticipate a March 2017 fare hike

MTA continues to anticipate a March 2017 fare hike

by Benjamin Kabak

New York City’s transit fares are on the rise again next year. In what was nothing more than a formality, the MTA this week confirmed that the agency’s policy of small biennial fare hikes will continue at least through 2019 and that the fares will rise in March of 2017 by an amount designed to increase fare revenue by around 4 percent. Riders aren’t happy, but if the MTA can offer a carrot to this ugly stick of increased transit costs, it’s a pill New Yorkers will resignedly swallow.

For a very long time, the MTA used to eschew fare hikes as a policy. Whether by order of those controlling the politics and purse strings in Albany or whether due to financial mismanagement, the agency would, as Chairman Tom Prendergast said on Wednesday, “stretch out” the period between fare hikes as much as they can. This led to perennially strained budgets and complicated negotiations with politicians. As the fares are the MTA’s only way to guarantee certain revenue, it wasn’t ideal, and the recent policy, enacted in the midst of a financial crisis, seems better than most, at least in a vacuum.

The problem with constant fare hikes is how it exposes the tension between what the MTA is and what people want it to be. Setting aside legitimate gripes about the declining quality of service, what do we want and need the MTA to be? Is it a vital government service that ensures mobility for New Yorkers across neighborhoods and income levels while saving our city, to the extent it can, from Los Angeles-level gridlock? Or is it an entity that’s supposed to cover (most of) its costs through fare revenue? Is it capitalism, socialism or some mix of both? I can’t given you a definitive answer; those are questions worthy of book-length explorations. But right now, it’s a mix of both, and the price we pay for rides keeps increasing.

So next year — and again in 2019 and probably again in 2021, 2023 and every two years until the Atlantic Ocean swallows our subway system — the fares will go up, and we’ll grin and bear it because even at $120 per month, a 30-day MetroCard will be a far better deal than driving everywhere. But something has to give. If the MTA is going to continue to raise fares, the agency also has to offer something in return for these fares hikes. Lately, the focus has been on a plan for reduced-fare MetroCards for low-income New Yorkers, and this movement will gain steam as another fare hike arrives. Under this plan, the city would subsidize rides, and the introduction of a new fare scheme would allow for a seamless transition to this arrangement if the city and state-run MTA can come to the table. The timing is right, but the politics of cooperation between the de Blasio Administration and Gov. Cuomo’s MTA may not be.

The other something to offer should be in the form of better service. During comments on the new financial plan earlier this week, Prendergast acknowledged that the MTA has to improve service faster, but speaking at a meeting and doing something are two vastly different things. The MTA is hamstrung by work rules that require significant lead time for workers to pick new shifts; thus, the MTA can’t add service tomorrow without planning for it six months ago. But if a fare hike is scheduled for eight months from now, the agency can certainly prepare to offer better service then. The questions are whether the agency has the capacity to deliver more frequent and more reliable subway service, and as a core competency, it’s not quite clear the MTA can do much better than it has been lately. That’s not a comforting thought, and ridership has flatlined as a result of it.

So where do we go from here? The fares are going to go up before the winter of 2016-2017 ends, and some service improvements or other relief should come with the hike. New Yorkers don’t like fare increases, and they certainly don’t like being told to pay more for what many few as sub-par service. To overcome the perception that the fare hike is simply a money-grab will require improved service of one form or another, and that right now is a big ask.

You may also like


TERRANOVA47 July 29, 2016 - 1:45 am

If the time for the fare hike is known, why isn’t the new fare announced?

Jumper July 29, 2016 - 2:50 am

I’ve proposed this before… but I think we should all go back to the days when jumping the turnstile was more acceptable.

If we all start doing it, it will be okay. Arrests are down and police are more focused on violent crimes, so you don’t have to worry as much anymore.

So let’s send the MTA a clear message… jump the turnstile… or buy a bike… it’s like the cost of a riding for one month… if we all switched to biking then the MTA would be screwed!

Caelestor July 29, 2016 - 4:48 am

Doing some math, a 4% fare increase would suggest a $2.58 ride (pay-per-ride). Thus the current system would switch to

16 percent bonus on $6+ refill

$32.50 7-day unlimited metrocard (break even at 13 rides)

$121.50 30-day unlimited metrocard (break even at 48 rides)

$6.03 express bus ride, $59 10-ride

I recommend that the 30-day pass be set to $118.50 (break even at 46 rides), to induce more ridership during off-peak. Ideally, none of the unlimited metrocards should increase in cost, but sometimes you have to compromise.

Marc July 29, 2016 - 11:36 pm

I don’t think that the MTA wants to encourage more off-peak ridership. For the most part (outside the G, L, and possibly M, which serve gentrifying areas Brooklyn), the record ridership we have experienced has come off-peak and NYC Transit has been reluctant to increase service middays, evenings, and weekends to meet the demand. It was one thing encouraging ridership when cars were half empty but now that some lines are as crowded as rush hour at 2 PM and 9 PM on weekdays and most of the day on weekends, a fare policy that encourages more off-peak ridership with no added revenue beyond the fare increase will have to be associated with more service and the cost thereof.

Tower18 July 30, 2016 - 7:28 pm

And this is the problem with our American insistence that public benefits be run like corporations. The driving factor should not be profit or loss, but a weighing of the impact on the public good.

If doing a thing would result in more off-peak transit ridership, with less auto trips, this is an undisputed public good and this thing should be encouraged, not discouraged.

Bolwerk July 31, 2016 - 12:55 pm

It won’t result in fewer auto trips though. Transit’s net impact on auto trips is probably nil.

Larry Littlefield July 29, 2016 - 8:02 am

“Riders aren’t happy, but if the MTA can offer a carrot to this ugly stick of increased transit costs.”

The TWU has never done this in my memory, but if you have heard the pronouncements of other political powerful unions — police, teaches, local 1199 — over the past 25 years, there is no carrot.

“Give us more or we will give you even less.”

And since management pay and numbers have been cut relative to the rank and file, there is no one else to blame. For the TWU there is one other thing to blame, however — Generation Greed’s rising debts.

There are going to be big increases in pension costs down the line, into the future. That’s even without any more retroactive pension increases.

eo July 29, 2016 - 8:44 am

Subsidized fares are a bad idea. You end up encouraging more use by the lower fare paying customers inducing more crowding. How is that a good idea? At the lower out of pocket fare the portion of people who qualify for the subsidy will increase their demand for the service making crowding worse. While I sympathize with the less better off citizens, other avenues for helping them should be pursued. Whatever the city wants to spend on this should be given to the same people in another form, maybe even cash. If they want to use it on travel on the subway that is fine, but if they don’t then they should not be forced to do so. You are also likely to create a black market for the subsidized fare-cards or whatever they use to distribute the benefit. Basically even people who do not need the subsidized fare-cards because they do not commute, but qualify for them, will get them and then sell them to people who do not qualify for them splitting the subsidy between the seller and the buyer. Why do we need such a black market and the inefficiencies associated with it?

While not certain, you might also get secondary effects where if you give low cost rides to enough sketchy characters, certain full fare customers will start abandoning your service leading to overall revenue decline (and less crowding). This might or might not happen depending on the implementation of the subsidy, so it needs to be considered in the design of any subsidy.

Daniel July 29, 2016 - 11:40 am

While the concept of a citywide Universal Basic Income (as you kinda sorta allude to there) is intriguing, it’ll never pass in the State Legislature and I’m not even sure how it would work on a citywide level.

Also, how would the reduced fare for lower-income New Yorkers different from, say, the 65+ reduced fare card? I imagine it’s the same system which would include a personalized card with their name on it, so no ‘black market’ for these would really emerge. Your comment on the whole seems to be fear of them poors crowding the subway, which is kind of inhumane, quite frankly.

Megan July 29, 2016 - 11:58 am

He must be a transplant.

‘Whatever the city wants to spend on this should be given to the same people in another form, maybe even cash. If they want to use it on travel on the subway that is fine, but if they don’t then they should not be forced to do so.”

Go figure.

Bolwerk July 29, 2016 - 2:40 pm

Is it capitalism, socialism or some mix of both? I can’t given you a definitive answer; those are questions worthy of book-length explorations. But right now, it’s a mix of both, and the price we pay for rides keeps increasing.

A sort of elected, sort of appointed officer with suzerainty over a defined territory delegates power, authority, and dignities to a mismanaged hoard of local prominent/connected citizens and (mostly inept) careerists. It’s a feudal organization with a capitalistic financial structure. Or, otherwise, it’s like Plato’s republic run by object lessons in the Dunning-Krugger effect.

Ralfff August 1, 2016 - 4:00 pm

I don’t think they think that they’re competent. I think they don’t care.

Megan July 29, 2016 - 11:50 am

“You end up encouraging more use by the lower fare paying customers inducing more crowding”

Stopped reading there.

Bolwerk July 29, 2016 - 2:10 pm

Oh, please, most of that that goes against a century of observed reality on every continent inhabited by an urban population.

Subsidies are perfectly fair, and neoliberalism is eternally stupid. The primary beneficiaries of many, maybe most, rides are employers and the state, not the rider. Subsidies reflect that reality. (The state is always at least a secondary beneficiary when a ride promotes any kind of taxable economic activity.)

Nick July 30, 2016 - 11:09 am

There are no fares that aren’t subsidized

Alon Levy July 30, 2016 - 8:30 pm

There are subsidized farecards right now. In New York, public school students get MetroCards that they can use to get to school. There are reduced fares for seniors in many systems. Is there a major problem of a black market? (Note: major problem, not one incident that the NY Post turned into a moral panic.)

BrooklynBus July 29, 2016 - 10:49 am

The MTA can’t continually raise the fare endlessly. They really need to consider switching to a fairer tine based fare instead of one that is vehicle based allowing an unlimited number of subways but only one bus transfer. Many trips can be made quicker by bus train and bus than two buses. Also, SBS increases the number of trips requiring an extra fare which is totally unfair. Consider the B46 SBS that doesn’t operate for the full route meaning that any passenger boarding on Broadway who wants to use SBS must pay a second fare to transfer to any crosstown bus.

Econ Transit Guy July 29, 2016 - 11:02 am

The MTA certainly can “raise the fare endlessly,” especially by amounts that largely track annual CPI increases. The issue is that these two next increases, while still designed to overcome years of artificially low fares, are outpacing inflation by a few percentage points. A time-based fare is fairly impractical from numerous perspectives.

BrooklynBus July 29, 2016 - 5:47 pm

I don’t see at all how a time based system is impractical at all. The two hour current limit on transfer time could be changed to 90 minutes except for areas and times where buses operate every 30 or 60 minutes, and you would be allowed 90 minutes to travel between your first entry to the system and your last transfer. That way anyone paying a double fare would probably making extra long trips anyway like over 15 or 20 miles, but n one making short trips of three or four mikes would be paying double fares as they are doing now.

The MTA is against this because of the fear of losing too much revenue from those making round trips with one fare. However, since the vast majority of round trios are not completed in two hours, the amount of revenue lost is over estimated and would be offset by new trips being made, encouraging people to make multi-purpose trips as those in cars frequently do which is more energy efficient. New technology could add additional options.

It took the TA 50 years to complete the two bus transfer system which was irrational for many years because of the same fear. Then that fear prevented bus subway transfers also. In both cases the revenue loss was overestimated and the same mistake is being made again.

Duke July 29, 2016 - 9:39 pm

The cost of everything in New York City is rising faster than inflation. Transit fares are hardly unique in this regard. There is a problem here that is bigger than the MTA.

john July 29, 2016 - 11:54 am

I’m guessing whatever new fare technology they implement will improve on the bus transfer limitation. Or at least I’m HOPING. 🙂

Ed July 29, 2016 - 11:46 am

Ben’s post raises some pertinent philosophical issues that all mass transit systems confront.

The first is to what extent is the ability of people to move around the city a public good? This is actually not as obvious as it first appears. Mass transit is often opposed, and this in fact goes back to opposition to building passenger railroads in the nineteenth century, because people don’t like poor people leaving their neighborhoods. And in Latin American cities, with worse crime issues than in the US, the metros (subways) actually are safer and more pleasant to travel on than other forms of transportation because favela residents don’t own the fares.

However, in the US, since World War II people are expected due to other features of urban planning policy to at least commute long distances to work.

Once you take the position that people moving around the city is a public good (which I do, if it wasn’t clear in the earlier paragraphs), then the logical approach to fares is to have the system paid for out of the public treasury in one form or another. That means no fares or heavily subsidized fares, though no fares at all have the advantage of removing the costs and delays associated with charging a fare.

However, there is an additional issue of capacity. Once the system runs over capacity, you have to start keeping people from using the system anyway. And it turns out the best way to do this is by charging fares as opposed to other forms of rationing, you at least get some revenue from this and it allows individuals to cut back in accordance with their need and their ability to pay.

We are stuck with fares, for political reasons and for capacity reasons. And if we have fares, they have to increase at least in lien with population growth and inflation.

In principle, as a public good, as much of the funding for transportation in general should be a charge on the treasury, with mass transit preferred as being both more efficient (lower operating costs per passenger mile) and imposing lower energy and environmental costs. I understand this way of thinking runs almost exactly contrary to the culture. But this is the goal.

I’m not sure if there are any ways to improve the process. Maybe the same approach that is used for allowing rent increases on rent stabilized apartments should be used for MTA fares. Yes, I know. But all stake-holders would get their say in a fairly orderly process and it really would be an improvement over what we now have.

mister July 29, 2016 - 1:22 pm

The issue of how mass transit is paid for goes beyond considering whether it is a public service or a self sustaining business. The question is: Who benefits from it? Yes, those who ride it benefit when they ride it, and as such, they pay a fare. But also, real-estate in many places is much more valuable because of the density that is only really possible because of the mass transit system. So should those property owners have to pay for the service that helps them run a profitable business? I think the answer is yes, but there is very little of that in place here in New York.

The other issue is that if we fund something as a ‘public good’, and just throw money at it, it could become wasteful and unnecessary, but we will keep throwing money into it because it ‘serves the public’. This is a problem the MTA has been facing for a while, new technologies that could reduce costs are either not adopted, or they are adopted but implemented in a way that keeps costs inflated. As we have seen recently, rideshare programs are starting to target the subway’s core ridership, and if driverless technology becomes a reality, it will become even more difficult for MTA to remain competitive on price unless they can increase their efficiency. If they can’t, will the ‘public good’ argument result in even more money coming from the public treasury in order to keep transit running? I don’t know the answer here.

BK Bed-Stuy July 29, 2016 - 4:06 pm

Driverless cars won’t fix anything, stop saying this. In a place like NYC, it will always be more efficient to move people via mass transit. Think about spatial requirements, the economies of scale that our current system already has, and the amount of resources need to get driverless system up and running. Nope, waaaaaaaaaaaay better idea to spend that capital and apply technology to mass transit.

Bolwerk July 30, 2016 - 2:05 pm

Buses and ferries already fixed everything. There are no problems left. Except the few that we need monorails for.

mister July 30, 2016 - 3:59 pm

Oh, I agree with you that driverless cars will not be the solution in NYC. But with a driver, rideshares are already starting to try and compete with transit. If they don’t have a driver, and use slightly larger vehicles, they will really be able to compete with transit, unless the MTA can find a way to become more efficient.

JJJ July 29, 2016 - 1:28 pm

MTA should be run like a business.

And by that I mean no business would be insane enough to raise prices 4% every two years.

They should taker their cues from successful businesses. Maybe offer a 5 (rides) for $4 deal. Or free 2 hour shipping (rides) for $99 a year.

Chris C July 29, 2016 - 2:48 pm

Current ticketing systen can’t handle that sort of thing. You could probbaly do it by handing out single use only cards though but that would be wasteful (and costly)

And yes some businesses do raise their prices on a yearly basis and sometimes more often. They can react more closely to e.g. changes in the gas price or the main comodity they use.

If the price of jet fuel went up you can bet your bottom dollar the airlines won’t wait 2 years to put their prices up it wll be done in 2 days.

BK Bed-Stuy July 29, 2016 - 4:15 pm

The MTA should not be run like a business. And by that I mean businesses always have the right to not do business with a customer that is too costly or too much of a pain. Governments do not, and should not act this way. Mobility should not be a luxury, it is vital to life in an urban environment. And, to the increase, I totally support pegging the fare to inflation, though I would also support dropping the fare and making up the difference with a wealth tax. Riders should have *some* stake in the ride (but it should be relatively cheap), and pegging to inflation prevents having to reinvent-the-wheel with finance structures all the time.

Alon Levy July 30, 2016 - 8:33 pm

Do supermarkets not raise their prices by about 2% a year on average?

Bolwerk July 31, 2016 - 1:24 pm

Looks like the “Food at Home” category in the Amerifat CPI index comes out to about 2.57%.

If I recall, inflation on unlimited MetroCards from 1996 to 2013 was around 67%. So that’s like 2

Bolwerk July 31, 2016 - 1:29 pm

(Ugh, please disregard premature post. Frau Catslut jumped on my keyboard as I was finishing two details.)

Looks like the “Food at Home” category in the Amerifat CPI index comes out to about 2.57% from January 2001 to January 2016.

If I recall, inflation on unlimited MetroCards from 1996 to 2013 was around 67%. So that compounds at like 3%/year.

But this is in light of lower inflation recently, and higher inflation over the prior decade.

Justin Samuels July 31, 2016 - 12:34 am

What do you mean businesses don’t raise their prices every two years. As time goes by businesses of course raise their prices, and it can be more frequently than every two years.

The problem is New Yorkers cannot understand that to have good subway service, either you pay for it in the form of higher fares OR you are going to pay for it in the form of higher taxes.

Moofie July 29, 2016 - 2:05 pm

The question of capitalism versus socialism hasn’t ever really been answered. NYC is the only place in the US where public transit is widely used enough that it constitutes the majority of commuting so it becomes a real question. NYC stopped building bridges but NYS decided to replace the Tappan Zee Bridge without any public transit component so things are really schizophrenic at the state level. I’m going to ignore NJ for now since Christy has just one upped killing the rail tunnel but stopping all repairs in the state.

Roger July 29, 2016 - 8:18 pm

Uber would be cheaper than MTA if this continues…..

Larry Littlefield July 30, 2016 - 11:15 am

If Uber is able to match origins/destinations for two or three riders then it may not be cheaper, but it will soon be the same price or just a little more for door to door service within the same borough. And beat the hell out of buses.

At one time, the MTA had a lower price for buses. The prices were for subway, bus, combo — with combo equaling subway alone. This gets a little tricky with monthlies, but it is possible the MTA might want to consider doing something like that again.

Bolwerk July 30, 2016 - 2:09 pm

Why would things be tricky with monthlies? A pass by definition should cover a whole spectrum of transportation. A bus pass could cover buses. A transit pass could cover all transit.

I don’t see a financial reason to do this though. Buses cost something like 2x what subways cost per passenger-mile as is. The only reason to do it would be to encourage more bus rides, and that can probably be done through other means (like increasing the cost of fares relative to passes).

AMH August 1, 2016 - 10:30 am

I think the best way to encourage more bus rides is by making buses faster, which has the benefit of reducing operating costs.

Bolwerk August 1, 2016 - 7:45 pm

Well, yeah, or more reliable.

Thing is, I think the decline in bus ridership might be more a demographic shift than anything right or wrong with buses. NYC buses have always kind of sucked, their users have always been shat upon. That didn’t start recently, and if anything there has been some at least tepid reform recently.

Tom Schmidt July 31, 2016 - 4:59 pm

That’s doubtful, but the MTA will get to a point where increasing fares cost revenue. Three people can take a cab two miles for less money than three fares on the subway.

I forget the fare hike that convinced me to walk from Grand Central to Herald Square to catch the PATH, but I wound up saving money, losing little time (16 minutes’ walk versus about 10 minutes on subway), and improving my health. As fares rise, on the margin, walking in Midtown gets cheaper. The MTA will at some point eliminate all trips under a mile, and it makes a tidy profit on those.

I already know some young people looking at Citibike monthly for transport in place of MTA, for the months other than Dec-March.

Nick July 30, 2016 - 11:20 am

Regarding the question of capitalism vs. socialism in transit: the vast majority of systems are a combination of both. There are almost no transportation systems (including cars/roads) that don’t combine some form of user fee with a subsidy. For cars, the subsidies are primarily through free parking requirements and the fact that the gas tax does not cover the full cost of road maintenance.

To my knowledge, the few times that transportation systems have paid for themselves are when they could capture capital from increased real estate values. For example, private train companies would buy up extra land around new routes to sell to developers (or develop themselves) for huge profit, which would then fund further expansion.

So the question isn’t really between socialism and capitalism, but what system or combination of systems is best for a city and what financing mechanisms can support it.

AMH August 1, 2016 - 10:31 am

Well said.


Leave a Comment