COTA Considering Fare Increase

It’s that time again. COTA considers raising fares every three years. Fares went up to $1.50 for a local ride in 2006, were delayed a year and raised to $1.75 in 2010, but they’re on the agenda again for 2012.

COTA board to debate fare increase for 2012
Despite surplus, riders expected to pay certain share
By Robert Vitale
The Columbus Dispatch Tuesday September 27, 2011 4:52 AM

Although they’ve piled up nearly $42 million in surpluses over the past three years, Central Ohio Transit Authority board members will begin discussions today about a potential fare increase in 2012.

The agency took in $10.9 million more than it spent last year, but officials said they want to make sure passengers pay their fair share for an operation that’s funded overwhelmingly by a portion of Franklin County’s 6.75 percent sales tax.

COTA long has sought to keep riders paying 18 to 20 percent of the agency’s yearly expenses, said spokesman Marty Stutz. With costs increasing faster than revenue, that share dipped to 17.6 percent last year.

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First, I think it’s good that COTA considers fare increases on a periodic basis instead of waiting for a crises like many transit agencies.  Second, it’s also good that they have a standard for farebox recovery ratio, the percent of the operating costs covered by fares, that can be used to help determine when a fare increase is justified.  Given the goal of 18-20%, and the current ratio of 17.6%, I thought it would be interesting to see COTA’s historical farebox recovery ratios based on National Transit Database (NTD) data.

Year	Farebox Recovery Ratio	Fare Revenue	Operating Costs
2000	20.1%	$13,255,339	$65,963,988
2001	18.5%	$13,195,008	$71,376,998
2002	19.6%	$13,165,114	$67,291,912
2003	17.7%	$12,497,957	$70,567,912
2004	16.6%	$11,779,221	$70,960,352
2005	16.0%	$11,756,470	$73,268,125
2006	19.6%	$13,205,864	$67,361,346
2007	18.8%	$13,071,440	$69,572,572
2008	17.8%	$13,884,507	$78,134,053
2009	17.1%	$13,817,908	$81,041,138
2010	17.6%	$15,400,000	$87,500,000

Note: 2010 data based on numbers in Dispatch article, not NTD data.

You can see that operating costs usually go up, although there is some variabilty based on the price of gas and amount of service provided.  If operating costs increase, and service levels, ridership, and fares all stay about the same, then the farebox recovery ratio slowly declines over time until fares are raised to generate more revenue.  That’s where COTA is heading now, with the ratio under 18% for the last three years.  So it’s probably a good time to consider a fare increase.  Either that, or radically rethink transit funding all together.

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