TO: AC Transit Board of Directors
FROM: Michael A. Hursh, General Manager/Chief Executive Officer
SUBJECT: Board Policy 333 Changes
ACTION ITEM
AGENDA PLANNING REQUEST: ?
RECOMMENDED ACTION(S):
Title
Consider approving amendments to Board Policy 333 - Fare Policy Goals and Methodology.
Staff Contact:
Chris Andrichak, Chief Financial Officer
Beverly Greene, Executive Director of External Affairs, Marketing & Communications
Body
STRATEGIC IMPORTANCE:
Goal - Convenient and Reliable Service
Initiative - Financial Efficiency and Revenue Maximization
The structure and implementation of the District's fare policies have direct effects on ridership, ease of system use, and revenues.
BUDGETARY/FISCAL IMPACT:
In Staff Report 22-187a in mid-2022, staff estimated moving to free transfers on Clipper(r) and the AC Transit mobile payment application would result in a loss of approximately 2% of total fare revenue. For the current Fiscal Year (FY) 2023-24, with a budget of $31.5 million in total fare revenue, 2% is $630,000. Looking at the pre-pandemic fare revenue from FY 2018-19 of $59.0 million, 2% is equal to $1.2 million.
The other proposed changes - allowing fare capping to be used for all pass products, and discontinuing 31-day 7- day passes in favor of monthly and weekly passes that are available both on Clipper and mobile - are expected to be cost-neutral for riders, or possibly reduction their costs, depending on their riding patterns. The reduction would come for riders who before might have bought a pass but do not ride enough in the month (or week, or day) to reach the full pass value. Since they would no longer be paying the full cost up-front - but only for the rides they take, up to the fare cap - passengers would no longer be at risk of "losing" any value of a pass they do not fully utilize.
These changes would be likely to result in a slight reduction in fare revenue for the District. Currently, if a rider purchases a multi-ride pass a...
Click here for full text