Fare Policies, Structures, and Technologies

Abstract

Cooperative Research Program (TCRP) Project A-1 has involved a comprehensive study of the major parameters of the transit fare decision-making process: fare policy, fare strategy and structure, and fare technology. Every transit agency must eventually address each of these areas, and, while each has typically been evaluated separately, it is important to understand the interrelationship among them. Policy generally guides the direction for strategy and structure, but technology decisions can also affect decisions regarding structure -- as well as policy. Electronic fare payment, for instance, offers the agency the ability to provide a broad range of fare options, while improving its own revenue control and operations planning capabilities. Emerging technological developments can also facilitate the expansion of the existing use of fare instruments to a broader base, possibly including other transit operators and non-transit functions. Thus, as transit agencies face pressures to maximize their operating efficiencies, increase revenues and expand their ridership, the need to be aware of capabilities of the emerging technologies becomes more important than ever. Project A-1 consisted of the following major elements: (1) Initial Review: a review of the current fare policies/structures and types of fare payment/collection technologies at transit agencies of various sizes in the U.S. and for selected cases in other countries; (2) Case Study Analysis: case studies of the decision-making process and results of the development of fare policies, modification of existing fare structures, and selection of new technologies and equipment at twelve U.S. transit agencies (of varying size and modal orientation); and (3) Review of Technology Trends and Developments: a review and assessment of the emerging trends and developments related to fare payment/collection technology; this effort includes a review of electronic fare payment applications around the world, as well as emerging developments such as regional fare integration, multiple use of fare cards, post payment, and electronic funds transfer. This report highlights the issues to be considered in making fare-related decisions, the experiences of transit agencies in selecting and using the various approaches, and the advantages and disadvantages--and future promise--of emerging developments. A companion document, Transit Decision-Making Guidelines, has been designed to quickly assist policy makers and managers in making fare-related decisions. This document is reproduced herein in Appendix D. The case studies discussed in this report are presented in a separate document, Fare Policies, Structures, and Technologies: Case Studies. This document is available for loan by request to the TCRP, 2101 Constitution Avenue, NW, Washington, D.C. 20418.

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