CHAPTER 2

Literature Review and Agency Outreach

2.1 Literature Review

Fare-free transit, also known as zero-fare, fareless, and prepaid transit, refers to transit agencies that, under certain circumstances, do not collect a fare from some or all of their riders. While this project’s literature review focused on full fare-free policies in the United States described in several recently published reports, international and partial fare-free transit policies are also briefly discussed. The results of this literature review are presented as (1) international academic literature, (2) domestic academic literature and TCRP reports, (3) transit agency or state DOT reports focused on full fare-free policies, and (4) transit agency or state DOT reports and academic literature focused on partial fare-free transit policies.

High-level findings from the literature review include the following:

• The history and study of fare-free transit services in the United States spans decades. The COVID-19 pandemic sparked greater interest in the feasibility of fare-free transit services. Several recent academic studies and TCRP reports detailing fare-free policies in the United States have been published.
• While the United States contains most of the world’s fare-free transit programs, similar policies can be found in other countries, including South America, Europe, Asia, and Australia. The purposes, characteristics, and outcomes of fare-free transit services were found to vary widely from place to place.
• Kirschen and Pettine (2022) defined full fare-free transit as “agencies that do not collect fares from any riders” and partial fare-free transit as “agencies that do not collect fares from specific groups of riders, on certain routes or transit services, during certain times, or in defined areas.”
• Few transit agency/state DOT reports on full fare-free policy outcomes were available; at the time of this review, only one report, published by the Mid-America Regional Council (2022), was available that provided both pre- and post-implementation results.
• Several transit agency and state DOT reports provided good background information regarding the current state of full fare-free practices in the United States. Many transit agencies are considering extending their fare-free practices in the absence of COVID-19 relief funding and are searching for relevant peer agency experiences to determine feasibility.
• The advantages of full fare-free transit include those related to economic health, social equity, and environmental sustainability. Common benefits include increased ridership, increased access to opportunities for economically vulnerable rider groups, increased transit agency productivity, increased driver and rider satisfaction, improved community quality of life, and decreased greenhouse gas emissions.
• Potential disadvantages of fare-free transit include increased passenger loads, increased budget pressure, increased concerns about securing funding, increased complaints about disruptive riders, and decreased schedule adherence due to increased ridership.

• With the onset of the pandemic, temporary fare-free policies designed to reduce the spread of COVID-19 were common, although many have been discontinued.
• Partial fare-free policies are widespread in the United States, with nearly every agency offering some type of partial fare-free service.
• Three types of partial fare-free transit services have been defined: (1) temporally limited (i.e., by the time of day), (2) socially limited (i.e., for specific groups of riders), and (3) spatially limited (i.e., for specific routes or geographic areas).
• For partial fare-free policies in the United States, zero-fare eligibility is most often reserved for children under 5 years of age, older adults, downtown circulator/historic trolley routes, and university transit systems or U-Pass programs.

2.1.1 International Literature

In a study published abroad, Kębłowski (2019) offered a comprehensive definition of full fare-free transit (see text box) and conducted a global analysis of the potential effect of full fare-free transit policies on economic performance, sustainable development, and social justice. Three major observations were made in the study.

First, from the perspective of economic utility, efficiency, and growth, the study found that some believe fare-free policies are only viable in small transit networks with low ridership and low farebox recovery ratios. However, evidence was cited from larger agencies, particularly in Europe, that successfully implemented fare-free public transit and increased local revenue via taxes.

Second, from the perspective of sustainability, fare-free policies were generally found to induce mode shifts less from cars than from walking and biking. More effective methods of inducing a mode shift away from cars were to increase gas prices, restrict parking and road usage, and improve public transit quality by adjusting its speed, frequency, and coverage.

Third, from the perspective of social justice, fare-free policies in the United States and Europe were generally found to have increased ridership among socially vulnerable groups such as youths, older adults, low-income individuals, and unemployed individuals. Although the United States led the world in full fare-free policies during the 20th century, which resulted in substantial ridership increases, many of these policies were discontinued due to a lack of political will to address the need for increased network capacity and security measures (Kębłowski, 2019).

2.1.2 Domestic Literature and TCRP Reports

Most of the relevant domestic research has been published through TCRP. Most recently, Kirschen and Pettine (2022) created a 10-step fare-free transit evaluation framework that allows transit agencies to evaluate the appropriateness of various full or partial fare-free scenarios. The framework, detailed in TCRP Research Report 237: Fare-Free Transit Evaluation Framework, includes the following 10 steps categorized under organization, design, and feasibility:

• Organization
  • Step 1: Identify relevant context and form a project team.
  • Step 2: Assess the transit agency’s existing conditions.
  • Step 3: Review relevant peer agencies that have considered/implemented fare-free policies.
  • Step 4: Identify opportunities or challenges to implementing a fare-free policy.

• Design
  • Step 5: Set evaluation goals and objectives.
  • Step 6: Determine performance measures.
  • Step 7: Establish selection criteria to determine feasibility.
  • Step 8: Select the fare-free scenarios to evaluate.
• Feasibility
  • Step 9: Measure the impacts of the scenarios using the evaluation plan.
  • Step 10: Select the preferred scenario using the selection criteria.

TCRP Synthesis 101: Implementation and Outcomes of Fare-Free Transit Systems (Volinski, 2012) summarizes the state-of-practice for full fare-free policies in the United States and in several other countries. The synthesis study found that most fare-free policies were implemented in the following areas:

• Small urban areas with modest ridership and large rural areas with low ridership.
• Resort communities with inordinately large demand during tourist seasons.
• University-dominated communities where most passengers were enrolled in or employed by the university.

The synthesis also found that smaller agencies with low ridership prior to implementing a fare-free policy could accommodate a ridership increase of 100 percent or more with existing capacity and with no effect on schedule adherence. The agencies participating in the study reported that they chose to not implement a nominal fare ($0.25 or $0.50) because of the negative impact on ridership and the substantial expenses associated with collecting the fare; such a nominal fare would result in little to no gain in revenue and potentially even result in a revenue loss. The synthesis also found that the Federal Section 5311 program—a program that provides capital, planning, and operating assistance to states to support public transit in rural areas—included a provision that encouraged nonurbanized areas to eliminate fares because the amount of assistance provided to such communities was reduced by the amount of farebox revenue reported (Volinski, 2012).

2.1.3 Agency Reports Focused on Full Fare-Free Policies

Several relevant reports have been published by transit agencies, state DOTs, and other government agencies. A 2023 report published by the Vermont Agency of Transportation (VTrans) quantified the ridership and revenue impacts of continuing Vermont’s statewide fare-free program (Vermont Agency of Transportation, 2023). To estimate the potential annual revenue foregone by a fare-free policy, ridership was forecasted for fiscal years 2023 and 2024. The study estimated that continuing fare-free transit in rural areas would decrease annual revenue by $303,000 but increase trips by 145,000. In urban areas, continuing fare-free transit would decrease annual revenue by $1.88 million but increase trips by 340,000. In the urban areas, fare collection expenses were about $36,000 (2 percent of fare revenue). Statewide, the overall fare collection expenses were around $150,000 (29 percent of fare revenue). The authors recommended that service should remain fare-free in the rural areas but be discontinued in the urban areas and for microtransit services. As reported in a follow-on study regarding funding sources for public transit nonfederal match (Vermont Agency of Transportation, 2024), VTrans has since reinstituted fares for their urban service but is considering alternative local funding sources for public transit.

In a study performed for the Kansas City Area Transportation Authority (KCATA) (Mid-America Regional Council, 2022), the impacts of its fare-free policy were analyzed to determine

economic benefits to the community and riders and identify necessary policy interventions to ensure sustainability and continued positive economic outcomes.

Quantitative outcomes of KCATA’s fare-free policy included high levels of rider satisfaction (88.3 percent) and security (security incidents per 100,000 riders decreased by 17 percent in 2019–2020). Employment, economic output, and personal income for the community and riders and agency ridership were predicted to increase, while carbon emissions were predicted to decrease (see text box).

Qualitative and equity outcomes of KCATA’s fare-free policy included the following:

• Increased access for high school students to employment and educational enrichment opportunities.
• Increased access to health care for people without private vehicles.
• High levels of support from community leaders.
• Increased likelihood for a small transfer in income from higher-income households to lower-income households because of the sales tax.

If changes to KCATA’s fare-free policy lead to a reduction in service, the potential exists for some riders to have less access to opportunities than they had before. If KCATA’s fare-free policy is discontinued, disproportionate equity impacts would result (Mid-America Regional Council, 2022).

A white paper published by the Northern Virginia Transportation Commission (2021) sought to provide a high-level overview of considerations for the evaluation of fare-free transit on locally operated, fixed-route bus transit systems. The paper reported that the elimination of fares resulted in ridership increases of 20 to 85 percent, depending on local factors, although strong evidence of a mode shift away from private vehicles was not observed. The increased ridership and potential associated service adjustments also had the potential to increase overall costs (Northern Virginia Transportation Commission, 2021).

An earlier study conducted for the Washington State Department of Transportation (Hodge et al., 1994) used in-state data to analyze the potential costs and benefits of offering fare-free transit. Overall, the experiences with fare-free policies in Washington were overwhelmingly positive, and researchers concluded that smaller communities were better served by fare-free transit policies. Agencies with low farebox recovery ratios were found to gain no net usable income by collecting fares because of the cost of fare collection. Agencies reported very few problems with disruptive riders, particularly in small communities or communities that offered education programs for student riders and enforced suspension of riding privileges for problem riders. The removal of the farebox resulted in the elimination of farebox disputes and driver conflicts with passengers. The authors argue that instead of measuring a system’s effectiveness based on the farebox recovery, a better measure may be the cost per rider over time (e.g., before and after the implementation of a fare-free policy) or the cost per new rider.

2.1.4 Agency Reports and Literature Focused on Partial Fare-Free Policies

Nearly every U.S. transit agency either offers or has offered some form of partial fare-free transit. Some states have programs that aim to facilitate fare-free transit for certain rider groups on a statewide scale. For example, Washington offers a transit support grant to agencies that implement a fare-free policy on all their modes for youths aged 18 and under (Washington State Department of Transportation, n.d.), Illinois offers fare-free transit benefits to older adults

and people with disabilities who have low incomes (Illinois Department on Aging, n.d.), and Pennsylvania has a program that allows all individuals aged 65 and older to ride fixed-route transit for free (Pennsylvania Department of Transportation, n.d.). Selected studies that describe experiences with partial fare-free policies in the United States are described in the following.

As shown in Figure 3, Kębłowski (2019) defined three major types of partial fare-free transit services: (1) temporally limited (i.e., by the time of day), (2) socially limited (i.e., for specific groups of riders), and (3) spatially limited (i.e., for specific routes or geographic areas).

In TCRP Research Report 237: Fare-Free Transit Evaluation Framework (Kirschen and Pettine, 2022), 10 agencies with partial fare-free transit policies were considered as case studies. The case studies collectively included temporally, socially, and spatially limited policies. In general, these policies resulted in increased ridership, increased costs due to additional demand, and decreased fare disputes. Funding sources for these programs included federal and state funds, one-time grants, payroll/sales taxes, and partnerships/cost-sharing with local institutions, businesses, and governments.

Other reports published by TCRP have considered specific types of partial fare-free transit, including TCRP Research Report 242: Homelessness: A Guide for Public Transportation, which considered free trips for unhoused populations (Zapata et al., 2023); TCRP Synthesis 87: Practices in the Development and Deployment of Downtown Circulators, which considered free downtown circulators (Boyle, 2011); and TCRP Report 78: Transit Systems in College and University Communities, which considered free transit systems in college and university communities (i.e., U-Pass programs) (Krueger and Murray, 2008). These policies were generally found to facilitate better services to individuals in need, decrease traffic congestion and air quality issues, and increase transit ridership.

2.2 Agency Outreach

Outreach to multiple state DOTs and transit authorities provided insightful feedback in support of this study. Table 1 lists the state DOT and transit agency participants. These participants included a range of small to large state DOTs and transit agencies and represented an array of funding sources. The state DOT contacts often provided the research team with additional transit agencies or other contacts, reflecting a breadth of innovative and challenging environments with both full and partial fare-free implementations.

The outreach discussions were consistent with findings from the literature review but yielded a greater level of detail that could be helpful when considering fare-free transit service implementation. Increased ridership, increased equity, decreased fare collection expenses, and improved

Table 1. Agency outreach participants.

operations (e.g., decreased boarding times) were universally recognized benefits. Concerns over increased real/perceived security issues, increased costs, and second-order impacts such as increased demands for paratransit services were also discussed. The success of fare-free programs generally hinged on finding a means of offsetting the decreased fare revenues and any increased costs while executing careful planning to offset or mitigate any potential negative consequences. Larger agencies had greater challenges executing fare-free services than small or rural agencies did.

With respect to the roles of each agency, the role of state DOTs in transit service—specifically fare-free transit service—was primarily focused on administering the programmatic funding from federal and state sources and providing general technical support to the agencies within their state, with a primary focus on rural systems. In some cases, depending on the state’s overall policy focus, general and targeted funding programs provide options for fare-free transit service (e.g., the flexing of highway program dollars to transit). Other states do not have the flexibility to support fare-free transit services and take a generally neutral approach. Fare-free transit services can be divisive at times, and the agencies within the states are generally the principal drivers of the implementations based on their needs and ability to assemble the funding levels needed to sustain operations.

The role of local transit agencies is to implement fare-free transit services within the confines of their available funds and to manage the benefits and impacts of the services. Agency staff know their community populations, the community’s service needs and priorities, the agency’s long-term capital programs, and the local partners who can make fare-free transit service a reality. They are on the front line in managing driver and passenger safety issues (real and perceived) and reacting to changes in funding availability (e.g., COVID-19 relief funds).

The remainder of this section summarizes specific findings from the outreach effort. State DOTs and transit agencies from the same state are generally listed concurrently.

2.2.1 Vermont Agency of Transportation

Transit services in Vermont are provided by one small urban agency in Burlington [Green Mountain Transit (GMT)] and six rural transit providers. One of the rural transit providers is located in both Vermont and New Hampshire. The entire state implemented fare-free service in March 2020 in response to the COVID-19 pandemic. As of March 2024, GMT is planning to transition back to charging fares, and the rural providers will focus on sustaining the fare-free program long term. Driven to a large degree by university and hospital students/employees, ridership at GMT is now nearing pre-pandemic levels. Pre-pandemic fares made up 18 percent of GMT’s operations budget, and were 3 to 4 percent for the rural providers. Advance Transit, which provides service to the Upper Valley area of rural Vermont, saw a 20 percent increase in ridership with fare-free service before the pandemic. Some tourist-centric transit services providing access to mountain ski areas have offered fare-free services for many years but ceased services altogether during the pandemic.

Working closely with the transit agencies in Vermont, VTrans was already planning to implement a fare-free pilot program, but the pandemic accelerated these plans. Notable findings from this pilot program include the following:

• Flexing federal transportation funds provided an option to fund these fare-free services.
• Funding levels for agencies that offer nonemergency medical transportation services may be affected by the amount of fares charged, resulting in a lower reimbursement.
• Security concerns with disruptive and all-day riders did not materialize.
• Microtransit services were being considered for implementation by some agencies as a premium service with fares; charging fares may limit the number of no-shows and cancellations.
• Some concerns were noted regarding increased paratransit costs.

2.2.2 Vermont Transit Agencies (Various)

Two studies were recently commissioned by VTrans to review the impacts of and funding sources for fare-free transit services in the state (Vermont Agency of Transportation, 2023; 2024). The research team was referred to the consultant who performed the studies.

As noted previously, Vermont has a single small urban transit agency in Burlington and six rural transit agencies. In Burlington, GMT serves a population of 110,000, operates 40 to 50 buses at peak pullout, completes 2 to 2.5 million trips per year, accounts for 50 percent of the state’s transit ridership, and receives 50 percent of the state’s transit budget. GMT implemented fare-free operations at the start of the COVID-19 pandemic but began reinstating fare collection on April 1, 2024, with some routes scheduled to resume fare collection on May 20, 2024. One commuter route will remain fare-free (Green Mountain Transit, 2024). In addition, some students and faculty are eligible for fare-free services through an agreement with the universities; multiple institutions participate in the Unlimited Access Program, including the University of Vermont, the University of Vermont Medical Center, Champlain College, and Saint Michael’s College. Rural agencies are likely to continue fare-free operation. Prior to the pandemic, two transit agencies already offered fare-free services. Other agencies had designated routes that were fare-free or had very low fares.

The transit agencies in Vermont rely on a wide range of funding mechanisms. In the urban area, GMT is supported through available state funds, local partner (city) contributions, and an agreement with the local universities for service. The Transportation Management Association administers the Unlimited Access Program agreement, which includes these institutions. Since its inception, GMT has assessed its member municipalities under its taxation authority. These member municipalities include nine urban/suburban municipalities and another municipality that contributes voluntarily based either on local budget line items or via petition at a town meeting. Rural transit agencies are supported through available state funds and agreements with ski resorts, human service agencies, and federal Medicaid providers. Some colleges also contribute, and some agencies have philanthropic programs seeking private donations. Vermont flexes over $20 million in highway funds, which exceeds its FTA apportionment.

Based on the collective experiences of these transit agencies, the following key findings and guiding principles have emerged:

• Transit operators favored fare-free operations because these operations decreased conflicts over fare collection and increased safety during the pandemic by minimizing contact with riders and allowing for rear entry.
• Issues with all-day or disruptive passengers occurred infrequently, but policies were in place to address these issues.
• Implementing fare-free service may have hidden costs (e.g., university student/faculty and hospital employee fares are paid through separate agreements).

• Agencies need to be ready to answer the question, “Does it have value if it is free?”
• Fare policies for microtransit services may need to be considered differently because of concerns over high no-show rates.
• Rural transit agencies report positive experiences with fare-free services as long as the agencies were made whole financially.
• Ridership impacts of fare-free services were mixed among the transit agencies.
• Little or no data existed to evaluate the impacts of fare-free transit services on dwell time.
• Passengers favored fare-free transit services because the system was easier to use, with no exact change requirements or embarrassment over unfamiliarity with the system.
• Partial fare-free services that target specific riders, modes, areas, routes, or times of day provide a possible alternative to full free-fare services.
• An interesting analysis technique for fare-free transit services included a comparison of increased ridership to lost revenue (similar to the comparison of projected increased ridership to new service costs).
• Transit agencies offering nonemergency medical transportation for federal Medicaid recipients may experience negative funding impacts for their fare-free services. Funding amounts may decrease due to formula issues and methods for maintaining recipient definitions and service roles.
• Riders who had a choice of modes continued choosing their personal vehicles; fare-free transit services predominantly benefited riders who did not have a choice of modes.

2.2.3 California DOT

The California DOT (Caltrans) provides general guidance to transit agencies regarding the use of various funding structures. As of March 2024, approximately 12 transit agencies in California offered full or partial fare-free policies. Fare-free policies may be offered on a more limited basis for students and youths using these funds. Caltrans maintains a fare structure that can be used to support fare-free policies throughout the state; the agency is currently focused on developing an integrated fare platform.

Based on its experiences with fare-free transit services in the state, the following key findings and initiatives have emerged:

• Fare-free transit services limit data collection that is tied to smart cards or fareboxes, but automatic passenger counters may provide an alternative.
• Some concern was expressed over the continuation of university partnerships if no fares were charged.
• Paratransit and microtransit services are difficult costs to reconcile within a fare-free structure.
• Caltrans is leading an effort to provide an integrated fare-purchase system that will provide options for agencies, particularly smaller agencies, to tailor fare-free services.
• The importance of local champions to drive fare-free transit service implementations was stressed; fare-free transit service has been divisive at times at the state level.
• The scale of costs for fare-free services at larger transit agencies brings unique challenges to implementation.

2.2.4 Los Angeles County Metropolitan Transportation Authority

The Los Angeles County Metropolitan Transportation Authority (LA Metro) provided systemwide fare-free service from March 2020 to January 2022 in response to the COVID-19 pandemic. During this time, LA Metro established a task force to monitor the fare-free policy, studying

the policy’s advantages and disadvantages. This effort led to a decision to implement a fare-free pilot program for K–14 students.

In 2016 (before the COVID-19 pandemic), decision-makers initiated the U-Pass program for college students attending schools in Los Angeles County; college students were allowed to use any participating rail or bus transit service within the county for travel for free. In June 2021, LA Metro began a 2-year, multiphase Fareless System Initiative. In Phase I, all K–14 students at participating schools in Los Angeles County completed applications and began using the pass-based system, which provides origin/destination and ridership data. Phase II will include low-income riders as part of the Low-Income Fare Is Easy program once the required funding has been identified.

Funding sources used by LA Metro have included the 2020 Coronavirus Aid, Relief, and Economic Security Act; the 2021 American Rescue Plan Act; and various partnership contributions/agreements with K–12 school districts and community colleges. Ongoing fare-free transit services are focused on K–12, college, and university students. During the initial pilot period for Phase I, partner school districts paid a universal rate of $3 per student for all K–12 students enrolled; partner community colleges paid $7 per student.

Interviews with LA Metro staff revealed the following key findings based on their experiences with fare-free transit services:

• The primary motivation for the fare-free policy during the COVID-19 pandemic was the safety of the driver and passengers.
• The LA Metro fare system uses smart cards; during Phase I of the Fareless System Initiative, staff were challenged to manage the volume of students accessing the web portal to apply for smart cards and to distribute the cards after the applications were complete.
• A full (universal) fare-free system was considered as an alternative, but the expected annual cost impact was $500 million to $1 billion, a significant portion of which would originate from increased demand for paratransit services.
• During the pandemic, homeless populations increased in Los Angeles County, and a corresponding increase in homeless riders occurred, particularly as they were being pushed out of public spaces like parks.
• LA Metro instituted a homeless outreach program intended to direct homeless individuals at stations and on transit routes and lines to supportive mental health or housing services.
• Security and safety incidents increased during the pandemic; lower ridership levels may have exposed existing riders to a greater risk of threats or violence.
• LA Metro found that safety and security concerns were largely addressed on routes with increased numbers of riders; riders had an increased sense of security if fellow passengers could observe bad behaviors.
• By retaining the smart card system, LA Metro was able to continue collecting data on participation and ridership, which is required to maintain their funding sources.

2.2.5 Virginia Department of Rail and Public Transportation

In February 2020, the Virginia General Assembly passed the Transportation Omnibus Bill (House Bill 1414), which created the Transit Ridership Incentive Program (TRIP) that sets aside a portion of funding for zero- and reduced-fare programs. The goal is to reduce barriers to transit use among low-income communities. Under this program, any of the state’s 38 transit agencies can apply for funding, request technical support, and seek guidance for initiating free-fare transit services. As a supplemental program, transit agencies can separately apply to offer riders reduced-fare passes. The TRIP is focused on developing zero-fare zones and zero-fare corridors.

The Virginia Department of Rail and Public Transportation (DRPT) Transit and Planning Divisions oversee this program.

Any successful TRIP grant recipient receives 3 years of state funding for fare-free transit service implementation, which requires a 20 percent grant match in year one, a 40 percent grant match in year two, and a 60 percent grant match in year three. In the fourth year, grantees are required to commit 100 percent local funding for systemwide zero-fare projects. Some transit agencies in Virginia remain committed to free-fare policies, while others relied on funding during the pandemic and are now collecting fares again. Applications for TRIP were first sought in September 2022, so the program remains in the early stages.

The grant application process for technical support under TRIP allows rural transit agencies to receive 50 percent funding with a 50 percent local match. Technical support can include assistance in developing fare policies and development of performing fare and equity studies to strengthen their 3-year grant applications.

As of May 2024, Charlottesville Area Transit (n.d.), Fredericksburg Regional Transit (2022), the Greater Richmond Transit Company (2020), the Alexandria Transit Company (2022), Mountain Empire Transit (Mountain Empire Older Citizens, Inc., 2020), Mountain Lynx Transit (District Three Governmental Cooperative, n.d.), the City of Fairfax (n.d.), and the City of Petersburg (n.d.) each offered fare-free policies.

Key findings and guiding principles offered by the Virginia DRPT staff included the following:

• Based on the TRIP applicant pool, many urban transit systems that offer free-fare services have more dynamic funding streams.
• Urban system justification for a fare-free implementation included increased ridership and use of transit services and the impact on low-income riders.
• Fare-free transit service policies can be divisive; boards with multiple agency representation (with different policy perspectives) presented a challenge for Virginia DRPT staff.
• The marketing of fare-free transit services was a key component of successful implementations.
• Partial fare-free transit services may be a good alternative in communities with a high dependency on fare revenues.
• Policies that require riders to alight at the end of a route appear to have addressed concerns with all-day riders.
• Contingency planning for future COVID-like events now includes consideration of fare-free transit services.

2.2.6 Missouri DOT

Transit agencies in Missouri range from large urban agencies in St. Louis (providing service in both Missouri and Illinois) and Kansas City (providing service in both Missouri and Kansas) to smaller urban and rural providers. KCATA was the only large urban agency in the state that implemented fare-free services during the COVID-19 pandemic. Some smaller urban and rural providers temporarily offered zero- or reduced-fare services during the pandemic, but most have returned to regular fares.

The Missouri DOT provides funding outside of federal pass-through funds to transit agencies. As a large metropolitan area, additional state funding for fare-free transit services in Kansas City is somewhat restricted. The Missouri DOT provides state funding to KCATA through the State Transit Assistance Program to assist with its operations costs, including any increased costs due to its fare-free transit services. Prior to July 1, 2022, the funding for this program was $1.7 million. The funding for this program increased to $8.7 million in July 2022 and to $11.7 million in July 2023. These state dollars can be used as a match for FTA federal programs.

Over a 3-year period, KCATA and the RideKC streetcar system received an 85 percent increase in allocated funding from this state program. Despite these encouraging funding trends, the Missouri DOT assumes a neutral role in the fare-free decision and offers limited opportunities for funding support.

2.2.7 Kansas City Area Transportation Authority

Kansas City is a mid-sized urban area with five transit operators across the region, all operating under the RideKC brand. KCATA is the designated recipient of FTA Urbanized Area Formula Grants – 5307 funds to support operations. The Ride KC or KC streetcar system (owned by the City of Kansas City, MO) runs through a transportation development district (TDD), which funds the streetcar’s fare-free services via sales and property taxes paid by the district’s stakeholders. The Ride KC streetcar, which was planned for fare-free operations from its inception, is being expanded from 2 miles to 6 miles.

As a large transit agency that implemented fare-free services pre-pandemic, KCATA had a unique role within the context of this study. A partial fare-free policy for the bus system was implemented in 2017, targeting veterans, university students, and high school students. The COVID-19 pandemic drove the decision to implement a regional fare-free policy in March 2022, which has remained in place since that time (RideKC, 2024). Before the pandemic, the wider bus system solicited partnerships with the Blue Cross Blue Shield Association and various universities, hospitals, and social services to financially support rider discounts. The City of Kansas City previously approved two sales taxes dedicated to transit and covering a portion of the citywide zero-fare policy ordinance, with the mayor championing the fare-free policies.

Based on their extensive experiences with fare-free transit services, KCATA staff provided numerous key findings and guiding principles. Key findings related to policy motivation included the following:

• The primary motivation for the RideKC streetcar fare-free policy was to encourage multimodal users in the TDD to overcome skepticism on a perceived new mode of travel and to eliminate inefficiencies of fare collection on a 2-mile system.
• The motivation for the fare-free policy for the regionwide bus system and paratransit services was multifaceted and included increased economic benefits through increased ridership, increased transit performance through decreased dwell times, and increased safety during the COVID-19 pandemic through decreased rider engagement and rear boarding options.

Key findings and guiding principles related to funding included the following:

• The City of Kansas City championed fare-free policies and supports them financially within the city limits, but the larger region outside the city limits may return to fare-based systems.
• Farebox updates for vehicles due to age or obsolescence were estimated to cost at least $8 million across the regional fleet of buses.
• Partnerships with veterans’ services, universities, hospitals, and the Blue Cross Blue Shield Association remain in place.
• As a funding source for the fare-free transit services via the RideKC streetcar, the TDD relies on special property taxes and sales taxes in the district to generate funds. As the line expands and approaches lower-density areas with lower sales and property tax revenue, fare-free transit services become less economically viable.
• If the TDD is no longer able to cover the costs of the RideKC Streetcar, deliberate design decisions have been made to enable future farebox installation (e.g., platforms and streetcars contain electrical conduits for farebox installation).

• As COVID-19 relief funds dissipate, implementation of a regionwide fare-free policy by KCATA may be difficult because the region spans two states and includes five transit operators.

Key findings and guiding principles related to transit safety and security included the following:

• Before initiating a fare-free policy in 2020, nearly all security incidents involving the bus operator were fare disputes.
• Incidents between riders have increased, which may stem from overcrowding, persons riding the bus without destinations, and riders with various other issues.
• Bus operators have requested a return to front-door boarding so they can more closely monitor problem riders or riders who have been banned from boarding the bus.
• Since 2019, KCATA has increased the number of security officers from four to 26 to address increased incidents with persons riding without a destination, with a segment of that population having mental health or addiction issues.
• A policy that requires the service vehicle to be emptied at the end of a route helped to address issues with all-day riders, but enforcing the policy is a challenge.
• Off-duty police officers are used to supplement security, and some partnerships were made with business districts to provide on-street staff who routinely ride in the RideKC streetcar to maintain a presence.

Finally, key findings related to ridership and rider perceptions included the following:

• During the COVID-19 pandemic, reduced transit service levels combined with the fare-free policy resulted in nearly overcrowded vehicles.
• The drop in ridership associated with the pandemic was not severe because the fare-free policy was already in place during COVID-19.
• Public outreach and surveys helped improve support for and identify concerns regarding fare-free transit services.
• Anecdotal responses from this outreach indicated that a segment of the ridership community has a preference to pay fares to maintain a perceived ride quality (i.e., by limiting all-day riders or riders whom they view as potentially disruptive).
• Onboard surveys of actual riders indicated support for the fare-free policy because of the convenience of getting on and off the bus without the worry and hassle of smartphone apps or payments.
• Reestablishing partnerships with veterans’ services, universities, hospitals, and others are being evaluated for the future to offset the loss of revenue from fare-free policies.
• A permanent full fare-free policy may be difficult given that the entire region (two states) and five transit operators participate concurrently under one brand as COVID-19 relief funds recede.

2.2.8 Hawaii DOT

Through its statewide planning office, the Hawaii DOT coordinates and supports three rural transit agencies in the counties of Maui, Kauai, and Hawaii. The County of Hawaii Mass Transit Agency offers fixed-route and paratransit services across the entire Big Island, including two urban areas on different sides of the island. This agency is the only transit service provider in the state of Hawaii with a fare-free transit policy in effect at the time of this writing.

Key findings and guiding principles offered by the Hawaii DOT staff included the following:

• The Hawaii DOT provides no state funding for transit.
• The decision to pursue a fare-free policy was made at the county level.
• The County of Hawaii has a dedicated fund for transit and low (7 to 8 percent) past fare recovery. The county also has a high concentration of low-income residents.

• Conversely, the transit agencies of the County of Maui and the County of Kauai have no dedicated transit funds and must compete with other departments for funds at the county level.
• The future loss of COVID-19 relief funding (and the change for riders) was a factor in the decision not to implement fare-free transit services.

2.2.9 County of Hawaii Mass Transit Agency, City of Escalon Transit, and Link Transit

The County of Hawaii Mass Transit Agency, City of Escalon Transit in California, and Link Transit in North Carolina are all managed by the same director (serving as an employee of all three agencies). This single point of contact was able to provide information for each of these transit agencies.

The County of Hawaii Mass Transit Agency operates fixed-route and paratransit services on the Big Island, including two urban areas and the surrounding rural areas. Buses range from 25 to 40 feet in length. The transit agency was motivated to implement a fare-free policy because of a low farebox recovery rate and declining ridership. Funding from the 2021 Coronavirus Response and Relief Supplemental Appropriations Act and the 2021 American Rescue Plan Act enabled them to enact their fare-free policy. Annual ridership has doubled from 294,000 to 588,000 since the transit agency added more routes, instituted fare-free services, and introduced a fare-based vanpool program. Riders were able to board more quickly and were not discouraged from taking public transit because of the fare collection barrier. The fare-free policy also freed up account clerks to take on other neglected responsibilities at the agency. Considering a potential return to a fare-based system, the transit agency is considering instituting a Genfare smart card system at a cost of $21,000 per bus.

Regarding safety and security, no disputes with bus operators occurred while the fare-free transit services were in place. The County of Hawaii Mass Transit Agency developed an initial security plan that stressed to drivers the importance of discouraging all-day riders, and the agency increased its annual security budget by $200,000 in advance of the fare-free services. Previously, security was maintained only at bus stops and stations. Now, security rides along on all transit buses. The transit agency also instituted a policy that requires all riders to have a destination in an effort to deter all-day or joy riders. The City of Escalon Transit in California and Link Transit in North Carolina maintain this same policy.

Prior to implementing fare-free transit services, the City of Escalon Transit in California carried from 2,000 to 3,000 passenger trips annually, with a farebox recovery rate of 1 percent. The transit agency used a Genfare system for processing fares. In California, state law requires rural transit systems to meet a specific farebox recovery ratio. This state law motivated the decision to institute a fare-free policy. Following the implementation of the fare-free services, the transit agency saw a 3 percent increase in ridership, primarily from older adults and low-income riders.

Link Transit is a small transit agency in Burlington, North Carolina. Link Transit recently instituted a fare-free policy to primarily eliminate administrative costs and associated impacts on municipal government.

2.2.10 Mississippi DOT

The Mississippi DOT does not provide additional funding to transit authorities beyond federal pass-through funds. The research team was referred to Oxford University Transit and Choctaw Nation Tribal Transit for further information.

2.2.11 Oxford University Transit

Oxford University Transit serves the city of Oxford, Mississippi, and the University of Mississippi. The agency offers fixed-route (using 30 30- and 40-foot buses) and paratransit services focused on city routes, campus routes, student housing routes, and safe rides home on Thursday, Friday, and Saturday nights. These routes also provide service to voting sites, the food bank, and medical facilities. Service for persons with disabilities is provided, but the service demands are low (9 to 10 trips per day). The rider population outside the university traffic is generally low-income and transit-dependent.

Oxford University Transit was founded in 2008 and has grown to be the largest transit service in Mississippi, with a pre-pandemic ridership of 1.4 million trips per year. A partnership agreement with the university allows students to ride for free, but nonstudents are required to pay a fare. In the summer of 2019 (when student traffic was low), a fare-free transit service pilot program was conducted. The results revealed a 25 percent increase in ridership during that summer period. In March 2020, the agency adopted ongoing fare-free services. Prior to the adoption of the fare-free services, the transit agency collected $20,000 in fares as part of its $6 million budget. Fare collection costs were found to be about the same as the revenue that was being collected.

The transit agency receives federal funding through the Federal Section 5311 program. Funding for the required match and additional services is provided by the University of Mississippi and the City of Oxford, and through funding agreements with apartment complexes serving the student population. The funding mix did not change with the introduction of fare-free services.

Based on the agency’s experiences with fare-free transit services, the following key findings and guiding principles have emerged:

• University and local community funding supported fare-free transit service implementation. Oxford University Transit leveraged a unique set of funding sources to increase access and remove barriers to transportation for riders with economic and social challenges.
• To address issues with all-day riders (often asleep) when temperatures are at the hot and cold extremes, the transit agency implemented a policy that required drivers to work with the passengers to assist them in finding their destination after one trip around the bus route. Late-night service involved some intoxicated passengers who required intervention by security personnel.
• A local champion plays an important role in pushing for fare-free transit services. In this case, the general manager proposed the change and made an effective case to the governing body.
• The Mississippi DOT remained generally neutral regarding the fare-free policy decision.
• The current intent is to continue fare-free transit services indefinitely. Fare collection expenses are deemed too high to be practical.

2.2.12 Choctaw Nation Tribal Transit

Choctaw Nation Tribal Transit serves an area much larger than the Choctaw tribal lands, which are geographically discontinuous. Service is provided to nine counties and includes services in Meridian, Mississippi, which is not part of tribal lands. All services are demand-responsive with accessible vehicles. Some longer trips are accommodated between Choctaw and Meridian to medical facilities in Jackson, Mississippi. These trips are provided as a transit service and are not funded as part of a federal Medicare/Medicaid nonemergency medical transportation program (considered high risk for the agency). Compared to traditional rural transit services that can access various state and federal funding sources, tribal transit services do not have the same access to funding.

During the COVID-19 pandemic, the agency focused on required medical trips (e.g., for dialysis) and serving essential workers. Fares were not charged at the height of the pandemic but resumed shortly thereafter. The Choctaw Nation subsidizes fares for tribal members; members pay half of the regular fares for routine trips and no fare for longer medical trips if authorized by the health center.

The COVID-19 pandemic took a high toll on the older adult members of the Choctaw Nation. As noted previously, transit is a people business, and many of the drivers were close to those they served. The death of so many of their riders struck the drivers hard; drivers were struggling with the mental toll of their personal risk with exposure as well as the loss of so many they were close to. The agency took steps to address this. This example serves as a lesson learned for any future health events.