DART Fare Structure. Increase. and Proposed Fare. Board Workshop January 5, 2018
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1 DART Fare Structure and Proposed Fare Increase Board Workshop January 5,
2 Presentation Outline Executive Summary Review of DART Fare Policy & FTA regulations, Financial Impact, and Fare History Fare Structure Changes Programmatic, Payment System Features, Pricing Revisions to initial proposal based on customer and Board member input Current & Proposed Fares Recap & Recommendation 1
3 Executive Summary Proposed fare structure amendment meets the financial commitment in the DART FY 2018 Twenty-Year Financial Plan and complies with Boardadopted Policy Revisions made to accommodate customer and Board input Coincides with introduction of new payment system and upgrades to both mobile and farebox systems 2
4 DART Fare Policy Background 3
5 DART Fare Policy & FTA Regulations Board-adopted Policy (III.01) State legislation ( ) requires fares sufficient to pay expenses FTA Regulations: Half fare for fixed route service for elderly & persons with disabilities, during off peak hours. Paratransit not more than twice the fixed route fare. Equity analysis ( Title VI ) to assess disparate effects on minority & low-income riders, and public meetings & hearing completed on staff proposal. 4
6 DART Financial Plan Considerations DART Financial Standard states Board will consider fare modifications to maintain DART s financial viability Twenty-Year Financial Plan (beginning in 2004) reflects a fare increase every 5 years Consistent, prudent financial practices adopted by DART Board and supported by subsequent Board decisions are cited by both Standard and Poor s and Moody s Investors Service rating agencies as one of the major factors underlying the high credit rating assigned to DART bond issues by both rating agencies 5
7 Fare Structure History 6
8 Fare Structure Components Fare schedule for each type of ticket (e.g. monthly pass) and explanatory footnotes (e.g. eligibility for reduced fare) Ratios: o Monthly = 16 day passes. o Annual = 10 x monthly. o Annual Corporate = 75% of Annual. o Regional = 2 x Local Programs Free fares (e.g. paratransit on fixed route, children under 5, voters, police officers in uniform) Reduced Fares Customer and route promotions, conventions, special event passes Corporate, residential, and higher education programs 7
9 Proposed Changes to Fare Structure 8
10 Proposed Fare Changes Introduction of single-ride fare for bus service at $2.50 (the price of 2- hour pass today) Expansion of 2-hour pass to a.m. / p.m. pass Across-the-board 20% fare increase except Mid-Day pass increase of 25 from $1.75 to $2.00 and Paratransit 50 increase from $3.00 to $3.50 Ratios to remain unchanged: Monthly = 16 day passes. Annual = 10 x monthly. Annual Corporate = 75% of Annual. Regional = 2 x Local except regional reduced fares will remain ½ local fare (see slide under comments received) Weekly pass ($25/week) eliminated. We sell a limited number of these passes & we expect fare capping to eliminate demand entirely. 9
11 New & Existing Fare Structure Features Single ride at $2.50 retains current price of two-hour pass and addresses almost 50% of all cash trips taken on bus Expansion of 2-hour pass to a.m. / p.m. pass Reduced Fare for high school students expanded from Monday through Friday to full week, starting in August 2018 Popular Midday discounted service increasing only 25 to $2.00 and expanded availability to full week Lone Star: Participants with TANF benefits eligible for reduced fare DART offers reduced fares for seniors, disabled, students & children on nearly all products (not just off-peak on base fare required by law) Higher Education Program contracts with schools to provide discounted service to students 10
12 Payment System Best Value Best value is a pay-as-you-go feature for the contactless payment cards upon deployment (and for GoPass in future) As the GoPassTap card is tapped, the system will deduct the lowest appropriate fare from the account balance associated with the card until the day / month cap is reached. [For example, first tap at 7:00 a.m. will deduct an a.m. pass cost. A second tap at 1:00 p.m. will deduct a midday pass cost. A third tap at 6:00 p.m. will deduct a day pass cost less the amounts already deducted.] The proposed cost of a GoPassTap card is $6.00. Upon activation, the account associated with the card will have transit value of $6.00. There is no additional cost for the card! 11
13 Payment System Fare Capping Fare Capping is a pay-as-you-go feature that allows DART riders, using GoPass or GoPassTap card, to automatically cap the daily & monthly fare so they will not spend more than needed on travel. Riders pay for each part of their journey until the cap amounts are reached, then pay no more for the rest of the day or month. To benefit from fare capping, riders must tap their DART card at a validator or activate their GoPass ticket as they board the bus or train. Fare capping for GoPass available May 2018; for GoPassTap cards available as the cards are deployed (starting in August 2018 ( soft launch) with full launch November 2018). 12
14 Payment System Stored Value Stored value is a payment system feature that allows DART riders to load value into a GoPass or GoPassTap account to use to purchase DART passes or pay for travel. Customers can add to the stored value in their account at retail locations throughout the service area, on-line, at the DART store, or by calling a special DART customer service number. 13
15 Programmatic Changes Effective Upon Board Adoption Expand Reduced Fare availability for high school students from Monday through Friday to full week, found in the Footnotes to Product Price Schedule and Section 4: Special Programs Stored Value and Fare Capping, found in Section 3: Stored Value and Fare Capping Clarifications to Fare Structure Wording, found in Footnotes to Product Price Schedule and Section 2: Free Fares 14
16 Programmatic Changes Effective Upon Board Adoption Addition of Programs now in pilot: Reduced Fares for the service area residents participating in a transitional program, found in Footnotes to Product Price Schedule and Mobility on Demand found in Section 4: Special Programs Addition of Reference to Other DART Policies: DART Board Policy III.07 DART Service Outside Service Area Boundary, and Policy III.16 Site Specific Shuttle Service Policy, both found in Section 4: Special Programs. 15
17 Changes Deferred Annual pass fare increase (originally proposed for January 2018) Options include: Fare increase for passes starting January 2019 Fare increase for passes purchased August 2018 or later. (Most annual passes are purchased at start of the year but a limited amount of (corporate & retail) are purchased during the year at a pro-rated amount.) New staff proposal: Fare increase for passes purchased August 2018 or later 16
18 Revisions resulting from Customer and Board Input 17
19 Comments Received - Day Pass and A.M./P.M. Changes Initial proposal: Change from 2-hr & day pass to A.M. & P.M. pass Why: New farebox ticket issuing mechanism more reliable, but will not issue mag-stripe ticket needed to develop ticket easier for operators to inspect. (And lower cost A.M./P.M. passes would reduce reselling.) Comments received: Offer midday pass on weekend for customers beginning journey shortly before noon. Retain convenience of day pass. New staff proposal: Expand midday pass availability to full week and retain the ability to offer a DART day pass on bus and TVMs year round. 18
20 Comments Received Trade Schools Initial staff proposal: Drop trade schools from Reduced Fare & Higher Education programs Why: DART requires student to complete a student ID application. However, Riders often purchase student reduced fare ticket at TVM without having obtained DART-issued student ID difficult to enforce due to variety of trade school types, school terms, identification. Comments received: Not equitable to drop trade schools from reduced fare programs. New staff proposal: Retain trade schools in Reduced Fare & Higher Education programs. Improve TVM process. 19
21 Comments Received - Regional Reduced Fare Initial staff proposal: Increase Regional Reduced Fare to ½ Regional Full Price Fare Why: Reduced fare products are currently regional passes but sell for ½ local reduced fare. Staff proposal revises reduced fare to mirror regular fare i.e. regional reduced passes sell for ½ regional full price fare. Comments received: This represents a large increase for reduced fare riders that travel regionally. New staff proposal: Continue reduced fare products as regional that sell for ½ local prices. Work with FWTA & DCTA regarding acceptance. (Without inter-agency agreement, riders will need to purchase FWTA or DCTA passes when travelling from one agency service area to another). 20
22 Comments Received - Annual fare increase option Initial staff proposal: The approved FY 2018 Financial Plan assumes a fare increase that remains in place for five years Comments received: A fare increase every 5 years results in a large percentage increase New staff proposal: The most appropriate time to consider a change in approach would be in conjunction with discussion of FY 2019 Financial Plan The percentage increase associated with an annual fare increase needs to be tested against several twenty year scenarios to confirm what percentage would essentially be equivalent to the current five year approach Discussions of lower annual percentage increases than an percentage that maintains equivalence needs to be addressed as part of the FY 2019 Financial Plan and Budget deliberations 21
23 Current & Proposed Fares 22
24 Current and Proposed Fares Current Proposed Single Ride (available only on bus) Aug Local N/A $2.50 Reduced Fare N/A 1.25 Regional N/A N/A Single Ride - Paratransit Mar Paratransit Demand Response Van/Sedan $ Service Paratransit Book of 10 (to be replaced by DART payment card) Paratransit Trips to Fixed-Route Stops Paratransit Eligible Riders on Fixed-Route Service FREE FREE 23
25 Current and Proposed Fares Current Proposed Two-Hour (will expand to a.m./p.m.) Aug Local $2.50 $3.00 Regional Reduced Fare Regional Mid-Day (9:30 a.m. 2:30 p.m.) Local Regional Day Local Regional Reduced Fare Day Pass Voucher Regional (10 vouchers) $30.00 $
26 Current and Proposed Fares Current Proposed Aug Week (not available after August 2018) Local $25.00 N/A Regional N/A Month Local $96.00 Regional Reduced Fare Regional Lone Star Regional Paratransit N/A
27 Current and Proposed Fares Current Proposed Aug Annual Local $ $ Regional 1, , Senior Regional Corporate Local Corporate Regional 1, ,
28 Payment Systems Changes 27
29 New Payment System Features GoPass (mobile) upgrade with ability to purchase tickets and add stored value using cash rather than a credit or debit card, available Spring 2018 Contactless payment card (GoPassTap) available August 2018 ( soft launch; full launch November 2018) with similar stored value features Cards available at over 900 locations throughout service area starting in August 2018 Retail locations accept cash for GoPass mobile (starting Spring 2018) & payment card purchases (starting in August 2018) Fare capping allows the pay-as-you-go purchase of a monthly pass. Available May 2018 for GoPass and August 2018 for GoPassTap 28
30 Payment System Mobile App & Contactless Payment Card Customers will continue to be able to set up a GoPass account on their mobile phone using the DART GoPass app The new DART payment system will also include contactless payment cards (GoPassTap). Customers can purchase GoPassTap cards at retail locations throughout the service area, on-line, or at the DART store. GoPassTap cards will have valuable features such as lost card value protection once registered. Riders must tap their DART card at a validator or activate their GoPass ticket as they board the bus or train. The new payment system will have new features including : Stored value, best value, and fare capping 29
31 Farebox Replacement New fareboxes will be installed in the first calendar quarter of 2018 New equipment will reduce revenue loss associated with out of service fareboxes Ridership reporting will reflect a noticeable increase in bus ridership due to reduction of out-of-service fareboxes Cash collection expenditures will be reduced due to lower cost printed media and lower maintenance cost due to elimination of trim unit (an expensive and high maintenance device previously needed to hold print media) 30
32 Recommendation 31
33 Recap Proposed fare structure amendment meets the financial commitment in the DART FY 2018 Twenty-Year Financial Plan and complies with Boardadopted Policy Expansion of discount programs: Single ride at $2.50 retains current price of two-hour pass. A.M./P.M. adds value over two hour product. Reduced Fare for high school students expanded from Monday- Friday to full week. Trade schools remain in reduced fare programs. Reduced fares remain regional passes. 32
34 Recap (continued) The new payment system will include contactless payment cards available at retail locations throughout the service area. The new payment system will have new features including: Stored value Best value Fare capping Lost card value protection. 33
35 Summary of Recommendations Across-the-board 20% price increase except Mid-Day pass increase of 25 from $1.75 to $2.00, change to AM/PM from two hour and Paratransit 50 increase from $3.00 to $3.50 effective August 2018 Retain current ratios : Monthly = 16 day passes. Annual = 10 x monthly. Annual Corporate = 75% of Annual. Regional = 2 x Local except regional reduced fares will remain ½ local fare Re-introduce single-ride fare for bus service at $2.50 (the price of 2-hour pass today) 34
36 Summary of Recommendations (continued) Trade schools continue as part of the reduced fare programs Weekly pass ($25/week) eliminated Reduced Fare for high school students expanded from Monday through Friday to full week Midday pass availability extended to weekends Reduced fares remain regional passes 35
37 Financial Impact Product Current Proposed Impact ($000) Total ($000) Day - Local (Change to AM + PM) Some customers will shift to either a AM or PM fare ($1,981) $13,582 Day - Reduced Fare (Change to AM + PM) Some customers will shift to either a AM or PM fare (402) 2,777 Day - Govt. & Not-for-Profit ,816 Two-hour - Local (Change to AM/PM) Some customers will shift to single ride fare of $ ,990 18,081 Two-hour Reduced (Change to AM/PM) ,707 3,127 Midday - Local ,872 Monthly - Local ,204 9,122 Monthly - Reduced ,670 Annual - Corporate Local ,712 10,276 Annual - Corporate Regional 1, , ,511 All Other (include Paratransit) 3,245 8,732 Total Passenger Revenues $10,445 $74,568 36
38 Overview of Proposed Fare Increase (20%) Fare Types Avg % Increase Estimated FY 2018 Revenue Daily Use: Single Ride, AM/PM, Midday and Day Pass Vouchers Extended Use: 7-Day (converted to AM/PM) and Monthly Other: Retail Annual and Special Event Projected FY 2019 Revenue Revenue Impact Daily Use 17% $ 34,749,642 $ 41,694,213 $ 6,944,571 Extended Use 20% 12,812,878 14,627,876 1,814,998 Corporate 20% 12,155,918 12,807, ,868 Paratransit 20% 2,446,509 2,932, ,083 College 20% 1,596,649 2,128, ,192 Other 20% 360, ,286 15,373 Totals $ 64,122,509 $ 74,567,594 $ 10,445,085 37
39 Calendar for Fare Structure Approval and Implementation Date Description 1/5/18 Board workshop 1/23/18 Budget & Finance Committee briefing of new fares 2/27/18 Budget & Finance Committee approval of new fares 3/3/18 Board approval of new fare structure 3/3/18 Effective date of programmatic changes (e.g. fare capping) May 2018 August 2018 August 2018 August 2018 August 2018 August 2018 November 2018 March 2019 GoPass 2.0: Fare capping on GoPass Deployment of new payment system ( soft launch) Fare capping on contactless payment cards General fare increase Introduction of $2.50 single fare on bus Elimination of weekly pass Start charging fares for LoveLink ride from Love Field Annual pass fare increase Full launch of new payment system Expansion of new payment system to, and fare increase for, Paratransit service 38
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