Transit Dangles Perks to Lure Riders in New Hybrid-Work Reality

Take a selfie while riding transit and win free sports tickets. Uncomfortable in a standing-room-only rail car? Call up a virtual seating map on your smartphone to see if there are open seats.

Transit agencies around the country are adding perks, discounts, and updated features as they adjust to their new reality: the five-day-a-week commute to an in-person job may not come back for a lot of people. Agencies that relied on fare hikes and assumed a captive audience have shifted to figuring out what it takes to win people back on board while they count on money from the new infrastructure law to give them some padding.

“We have to rethink the fact that transit historically has been treated like it has to pay for itself and to invest in transit in a way that reflects that it is a must-have essential service,” said Janno Lieber, acting chair and CEO of New York’s Metropolitan Transportation Authority. “We’re an $18 billion a year business that lost half its customers.”

Transit ridership plummeted by 79% in 2020 compared to 2019, according to the American Public Transportation Association. Now, the Biden administration and local officials are touting the new infrastructure spending as a way to revitalize transit into a ubiquitous option for a greener transportation future.

Agencies are reshaping fare and ridership plans to target riders with hybrid work schedules even as they deal with worker shortages and new Covid-19 variants that have kept crowds and service levels from fully returning.

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The Boston area’s Massachusetts Bay Transportation Authority launched a Flex Pass tailored to those who used to buy monthly passes. It includes five one-day passes for commuter rail at a 10% discount that can be used within a month. “We are hearing definite appetite for different fare products and we’re just trying to determine how we can meet that need,” General Manager Steve Poftak said.

The Maryland Transit Administration announced similar three- and 10-day passes.

“What’s been different is the mix of riders, where we have more riders riding at all different times of the day, that’s offsetting fewer riders that you might say are riding a traditional 9-to-5,” said Peter Rogoff, CEO of the Seattle area’s Sound Transit. That agency saw passenger counts drop as much as 80% during the pandemic’s peak, then bounce back recently as riders travel to universities, stadiums, and the airport.

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Expanding to Gain Riders

The infrastructure law (Public Law 117-58) provides about $89.9 billion for transit over the next five years, which the administration called a record amount. Transit agencies say that a longer-term way to get riders back is through capital projects, with service upgrades and expansions.

“World-class cities like Charlotte deserve world-class transit systems, and this law is going to help you build those systems,” Vice President Kamala Harris said in North Carolina earlier this month.

Agencies across the country pointed to projects they hope to build with the new federal funds. Sound Transit’s expansions will trigger a “very dramatic spike in ridership in those neighborhoods,” Rogoff said.

But analysts have raised concerns that the law is tilted toward new facilities instead of maintenance. When agencies build rail lines that aren’t supported by ridership, they generally have to cut bus service because they don’t have the resources to operate both, said Baruch Feigenbaum, senior managing director of transportation policy at the Reason Foundation.

“Buses are used more by who we call transit-dependent riders, folks who don’t have access to a vehicle, and so they are actually more hurt when their lines are cut, versus if there was a rail line that we chose not to build,” he said.

Transit expansion projects haven’t gone without criticism, as they can be costly and take years. The long-delayed Silver Line expansion of Washington D.C.’s mass-transit system is set to open in 2022 after being roughly planned since the 1960s.

Free, Reduced Fare Spreads

In New York, ridership fell to about 10% of normal levels on subways in the pandemic’s early days and the system was losing $200 million a week, Lieber said. Although that has since improved, MTA projects it will only get back to 85% of previous ridership by the end of next year.

To aid the recovery, MTA announced Monday it was aiming to cap fares next year and lower commuter-rail fees. New York’s subway and bus riders who use their “tap and go” payment system will ride free after their 12th trip of the week.

In New Orleans, which also had ridership fall as much as 90%, the Regional Transit Authority reduced the cost of its monthly transit pass and made it valid across streetcars, buses, and ferries, CEO Alex Wiggins said.

Monthly pass sales increased about 20% during a six-month pilot program, and the agency’s board will consider making it permanent. “Prior to Covid, we were averaging essentially almost 20 million passenger trips a year, and it’s our goal to return to that in 2022,” Wiggins said.

Federal money has also made free rides an option. Boston’s new mayor, Michelle Wu, took steps last month to use $8 million in federal funds to cut fares on several bus routes for a two-year period.

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Her request comes after a four-month fare-free pilot program on one bus route boosted ridership to 92% of pre-pandemic levels, the city said.

Lawmakers introduced a bill (S. 1172) earlier this year to fund fare-free transit more widely. Democrats’ social spending and tax package (H.R. 5376), which is awaiting action in the Senate, also includes funding that could be used for fare-free or reduced fare-service.

Several transit agencies in North Carolina suspended bus fares until June 2022, using Covid-19 relief funding provided by Congress. Charles Lattuca, head of GoTriangle in the state, said going fare-free helped keep drivers from having face-to-face contact with customers and removed the cost barrier to ridership.

Photo: Maddie Meyer/Getty Images

A Covid-19 poster inside the Massachusetts Bay Transportation Authority’s Park Street station on March 29, 2020, in Boston.

Tickets, New Tech Pitched

Promotions and new technology have also been tried as methods to woo riders.

Boston’s transit authority is capitalizing on higher gasoline prices to go after its biggest competitor: the car. Drivers stuck in traffic or filling up at the pump can see “Next time take the T” billboards and display-screen advertising. It even handed out Dunkin’ gift cards on one morning commute.

“There is a segment of former customers who are driving in their cars,” Poftak said. “What they’re finding is their commutes are getting longer and longer and we’re trying to communicate with those customers.”

California’s Bay Area Council launched a social media contest to promote transit agencies adding back routes and more frequent service. Riders who snap a picture riding transit enter for a chance to win tickets to local sporting events, including the San Francisco Giants, Golden State Warriors, and Oakland A’s.

“We were assuming a number of people had moved during the pandemic or were commuting to a new location, as many of the companies in the Bay Area have been more flexible about where folks work,” said Gwen Litvak, senior vice president of public policy for the Bay Area Council. “We were really trying to get at that behavior change moment.”

Some agencies are rolling out mobile pay, virtual seating previews, and apps. The Southeastern Pennsylvania Transportation Authority, which serves Philadelphia, launched a new online tool to provide customers with information about seat availability on vehicles as they plan their trips.

A survey from TransLoc Inc., a transportation software company that is a subsidiary of Ford Motor Co.‘s Ford Mobility, found that 74% of respondents want new apps or technology for transit. Riders find safety protocols and overcrowding to be increasingly important, TransLoc CEO Brett Wheatley said.

“They just have higher expectations now for public transit,” he said.

To contact the reporter on this story: Lillianna Byington in Washington at lbyington@bloombergindustry.com

To contact the editors responsible for this story: Bernie Kohn at bkohn@bloomberglaw.com; Sarah Babbage at sbabbage@bgov.com