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Grow the System, Not the Fares

July 24, 2008 By Barb Thoman, Transit for LIvable Communities

The Twin Cities region faces budget shortfalls as far as the eye can see for urban and suburban bus operations. The primary funding source for transit is a sales tax on vehicle purchases. But vehicle sales are down, and so is the funding for transit. These shortfalls come at a time when transit ridership is at record highs and many peak-hour buses are filled to capacity.

For the region, the projected shortfall is $45 million in 2009, $42 million in 2010 and $30 million in 2011. The 2009 deficit was reduced to $15 million when $30 million from the new quarter-cent regional sales tax for transitways was allocated to bus operations. The projected shortfalls represent about 10 percent of transit agency budgets.

The Metropolitan Council is proposing fare increases for bus and rail service to close the gap - 25 cents this year and possibly 50 cents more in 2009. The council held hearings this month on the proposed hikes and will accept written comments through Friday.

If the region's transit fares go up 25 cents, we will have some of the highest peak-hour rates in the nation -- $2.25 for local service, $3 for express. Only four of the 20 largest metropolitan areas have peak hour fares of $2.25 more - and in those regions, it buys you access to much larger and more robust transit systems. In our region, the higher fares will only cover a shortfall - they won't grow the bus system.

These budget shortfalls will again set back the Met Council's planned expansion of bus systems, which has been delayed each year since 2000. Expansion of bus and rail is needed to promote more compact and sustainable development patterns, fight climate change and make transportation more affordable within the region.

The budget shortfalls must be addressed, but there are alternatives to raising fares:

  • The Met Council has $19 million in its budget reserves. Tapping half of this fund would buy time for the 2009 Legislature to allocate additional funding.
  • A percentage of the funding from the motor vehicle sales tax now allocated to metropolitan trunk highways could be directed to Twin Cities transit instead by the 2009 Legislature. The region shouldn't be spending money on highway expansion projects if it can't even maintain the bus system.
  • Increase the regional sales tax for transit to cover the funding gap.
  • Institute a new tax on off-street parking and dedicate some or all of the revenue to transit. Transit in San Francisco is funded this way and Chicago also has a regional parking tax.
  • Revive the metro area property tax for transit operations.
Twin Citians deserve convenient, affordable alternatives to driving, and higher transit fares hurt people who need transit the most. With high gasoline prices and a slow economy, transit fares should be as affordable as possible. Raising bus fares stands in the way of our larger goal to develop a transit system that ensures more people access to the mobility they need.

Check out Transit for Livable Communities' newest policy brief, which compares transit fares in the Twin Cities with fares around the country. Many regions have comparable fares to those in the Twin Cities, but they have much more extensive systems.

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