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Raleigh Pushes for Permanent Fare-Free Transit

The state capital has a modest-sized transit system, so taking out the farebox during the pandemic was easy and so far everyone likes the outcome. But making free bus service financially sustainable could be harder.

Riders board a city transit bus in Raleigh, N.C. (
David Meeker seems like an unlikely champion of fare-free transit in Raleigh, N.C., or anywhere. He works in the real estate and the restaurant industries as partner in Carpenter Development, which plays a role in redeveloping the fast-growing southern city’s urban core.

But Meeker is also a huge proponent of public transit, and for years he’s been helping to build a coalition to turn Raleigh’s transit system fare free.

“You are giving every person who can't afford a car $50 a month, that’s $600 bucks a year, and for a lot of people that's a month's rent,” says Meeker. “It's not even like a one-time $600 check. It's every year for the next 30 years, you're giving a $600 check.”

Before the pandemic, Meeker and his allies figured a fare-free campaign would take four or five years to win. But as COVID-19 swept over the country, the City Council acted quickly to scrap payments for bus riders. That would allow all-door boarding — minimizing interaction with the driver — and it would be a boon for beleaguered essential workers who still had to report to work.

They also figured it would be a good way to prevent germs passing by money: Raleigh’s $1.25 fare was often paid in cash because there were no fare cards (although you could buy daily, weekly or monthly passes).

In 2021, the City Council has extended the pandemic-era fare-free norm for another budget year. For Meeker and his allies, both in and out of government, this feels like the moment to lock in this policy change.

“It opened a unique window, where we had the opportunity to implement fare free for the pandemic, and then keep it in this budget,” says Jonathan Melton, an at-large councilmember. “We saw similar things happen in other areas of the city, where the pandemic put light on things that we could do differently, like outdoor dining and expanded access in our rights of way.”

Making transit fare free in a municipality like Raleigh, where almost 2 million people rode the system in 2019, is a different proposition than in the larger cities that dominate the public transportation conversation. In cities like Washington, D.C., or New York, fares make up a huge percent of a transit agency’s budget.

By comparison, in 2019, the cost of running Raleigh’s bus network was over $31 million with fare revenues only coming to $3.4 million. When the amount spent on collecting that revenue is considered — paying people to collect and move large amounts of physical money — the actual amount is even less. Meeker says that an analysis of Kansas City, which is a similarly sized city with a similar transit system, found that 40 percent of fare revenue was spent on collection.

During the pandemic, the cost of going fare free was covered by the influx of federal funds that were used to prop up the operating budgets of transit agencies all over the country. Thanks to the Biden administration’s American Rescue Plan Act, that aid is being extended, with both municipal governments and transit service specifically receiving aid.

“We may have money left over from the federal government, and we may be able to spend it for another year [on fare-free transit], to give us more time to figure out how to close the gap,” says Corey Branch, mayor pro tem for the Raleigh City Council.

So far, there’s been no campaign against the idea of giving transit users a free ride. Meeker says the institutions of higher education are for it because many of their students don’t have cars, and even the Chamber of Commerce is supportive because it's a marketable and environmentally friendly idea.

But fare-free transit hasn’t truly faced a reckoning yet. The flood of federal funds was meant to boost an essential service while some of its normal revenue streams were not available. It is by no means guaranteed, or even likely, that large-scale federal support for transit operations will be extended into a post-COVID future.

If there is a fight, it will come over how to actually pay for that gap in funds where fares used to be when there aren’t pain-free dollars from D.C. floating around. Branch says council staff are studying different ways to pay for the policy in the future.

“I'm not going to say that there hasn't been a lot of pushback, because I haven't gone in deep conversation yet,” says Branch, who also chairs council’s transportation committee. “In order to remain fare free, we could look at a sales tax. I hate to say property tax, but that could be in the conversation. Looking at other grants, finding ways to bring in roughly $5 million annually is going to be key.”

Branch wants to find $5 million annually, instead of the $3.4 million that was required in 2019, because he expects more service to be added, especially as planned bus rapid transit lines are rolled out in the years ahead. He also expects the fare-free option to increase demand on the service, which could require more frequency.

There has been debate over the idea of going fare free in larger cities like Los Angeles and Boston. As Henry Grabar argued in Slate, what actually keeps many riders off these systems is their unreliability and long wait times. Why not spend the money that could go to free fares on making the system actually service the people who ride it?

But in smaller cities like Raleigh, where fares are a small part of the budget compared to systems like Washington, D.C., maybe that won’t be as big of a challenge. Megan Ryerson, a professor of transportation at the University of Pennsylvania says, “it's a very different calculus in cities like Raleigh, and I think there are a lot of equity benefits to free transit.”

Meeker says that continued fare-free service will increase both the reliability and popularity of Raleigh’s transit system. When so many riders were paid in cash before, the process could be intimidating: Who carries $1.25 around with them all the time?

“If you can just show up to the bus stop and hop on and not have to worry about it, that ease of entry is a big deal,” says Meeker.

Paying fares also made the buses slower, as passengers boarded and counted out nickels and dimes or tried to slide crinkled dollar bills into the fare machine. Now with free boarding, both doors are used and the boarding process is much quicker.

“The bus system is moving faster and more efficiently than ever now,” says Meeker. “I think fare free is the way to go first, then get a lot of demand because it's free and then crank up the service.”

Jake Blumgart is a senior writer for Governing and covers transportation and infrastructure. He lives in Philadelphia. Follow him on Twitter at @jblumgart.
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