New York’s MTA to Give Fare Incentives to Boost Ridership

(Bloomberg) -- New York’s Metropolitan Transportation Authority aims to lure more riders on subways and buses by capping fares next year and lowering commuter-rail fees as the transit agency tries to restore ridership to pre-pandemic levels.

The pilot program comes even as the MTA may be able to delay a 4% fare hike for a second year, potentially giving riders another incentive to use subways, buses and commuter trains.

Under the fare-capping plan, subway and bus riders who use the OMNY “tap and go” payment system will get free rides after their 12th trip of the week. Each week, riders would pay the current $2.75 single-ride fare for their first 12 trips starting every Monday and any additional rides during that week would be free, according to the MTA. No subway or bus OMNY user will pay more than $33 per week, the current charge for a 7-day unlimited MetroCard.

The MTA board plans to vote at its monthly meeting on Wednesday on the temporary fare program, which would begin March 1 and would last at least four months. Riders can tap their credit cards, smart device or One Metro New York card to ride subways and buses. The MTA launched the OMNY system in 2019 and it will replace the current MetroCard in 2023.

The MTA is the largest U.S. mass-transit provider, overseeing New York City’s subway and bus network along with its commuter lines Metro North Railroad and Long Island Railroad. The agency needs to restore ridership after subway usage plunged by as much as 90% during the pandemic. Weekday subway ridership last week was about 57% of 2019 levels.

The subway and bus fare-capping plan comes as the MTA could delay a planned July 2022 fare hike if the state’s upcoming budget directs money to the transit agency to help cover the cost to postpone into 2023. A 4% farebox boost would give the MTA an estimated $17 million next year, Bob Foran, the MTA’s chief financial officer, said Monday during a committee meeting.

“To the extent that the executive budget put forth in January by the governor and the budget director has funds to supplement or replace that, which we believe is an intention, then we would change that in the February budget,” Foran said.

MTA estimates the fare-capping incentive will cost as much as $20 million during the four-month pilot program, according to Tim Minton, spokesman for the MTA.

Discount Tickets

Starting March 1, the MTA will temporarily offer Metro North riders and Long Island Railroad customers a new 20-ticket pack, which will be 20% off the same number of peak one-way fares. The MTA will cut monthly tickets by 10% and will offer a flat $5 fare on weekday off-peak trains for trips made within New York City.

Those commuter-rail incentives are projected to cost about $12 million during the four-month program, according to Minton.

The MTA has struggled to bring riders back to its commuter rails as many people continue to work from home at least part of the week. Metro North last week carried about half the weekday riders it did in 2019 and weekday Long Island Railroad usage is a little more than half of pre-pandemic levels.

Improving ridership will help the MTA address its long-term budget shortfalls as federal aid to cover lost farebox revenue will dry up in 2025 and subway ridership may only reach 86% of pre-pandemic levels in 2024, a $1 billion loss every year in farebox revenue.

MTA’s board is also set to approve on Wednesday a $18.6 billion operating budget for 2022, which will include $2.4 billion of federal funds to help balance that spending plan. By 2025 the MTA projects it will need to use $1.4 billion of borrowed funds to help close its budget deficit.

The board will also weigh in on the MTA borrowing as much as $2.8 billion to cover capital needs in 2022, including $500 million for bridges and tunnels and another $305 million to implement a new tolling program that will charge drivers going into Manhattan’s central business district.

©2021 Bloomberg L.P.