Revenue from fares on Sound Transit buses and trains has cratered in recent years as operating costs climb, creating a “financially unsustainable” trajectory for the regional transit agency, CEO Peter Rogoff told board members Thursday.
Depressed ridership because of COVID-19 underpins much of the drop in revenue. But Rogoff also blamed an increase in passengers who ride without paying, which comes as Sound Transit’s enforcement presence is significantly scaled back.
“When you’ve got a situation with a 98% chance of being out on the system and not being contacted by anybody to have any conversation, that just lends itself to further noncompliance,” he said. “We need to get back to a place where our passengers are honoring the honor system that we’re using.”
Rogoff’s warnings come as Sound Transit works to revamp its approach to fare enforcement, which was shown to disproportionately land on people of color. The agency previously employed security guards to check that riders had paid before boarding, but is currently testing the use of “fare ambassadors” instead. The ambassadors are not issuing citations for noncompliance, but instead are offering educational materials.
Some advocates have pushed Sound Transit to focus more on transit access over fare enforcement. But fare collection is a cornerstone of the agency’s long-term financial plan and recent negative trends necessitate action, Rogoff said.
The board, made up of elected and appointed leaders from across the region, will soon decide how it wants to proceed on fare enforcement.
From 2019 to 2020, revenue from fares dropped from $96 million to just $30 million as ridership dried up during shutdowns. Where revenue covered 32% of Link light rail’s operating cost in 2019, it made up 8% in 2020. When all is accounted for, Sound Transit staff forecasts that just 5% of light rail’s operating costs will have been covered by fare revenue in 2021. The agency’s board had previously set a goal of 40%, which it has only met once, in 2017.
In November 2021, ridership across all Sound Transit modes was just over 2 million people, compared to around 4 million before the pandemic.
Fare revenue from employer-provided ORCA cards was also down, from $48 million in 2019 to $13 million in 2021.
Sound Transit briefly suspended all fares in April and May 2020, as the state went into widespread lockdown. Fares went back into effect in June, but enforcement has not. The ambassador program launched in September of last year.
Rogoff, who is leaving the agency this spring, presented the board with data showing a jump in “fare evasion” from 3% in 2018-19 to between 10% and 30% in 2020-21, based on information collected by fare enforcement officers or ambassadors as they ask riders for proof of payment. As many as 40% to 70% of riders were “nonfare” passengers — which includes riders in 2020-21 who were exempt from fares for various reasons, such as age, as opposed to 14% in 2018-19.
The steep declines come as overall costs are projected to increase with an expanded light-rail network by as much as $3 billion through 2046.
The conversation around fare collection is unfolding as Sound Transit and its board grapple with the inequities in its enforcement and, separately, as the state Supreme Court prepares next month to hear arguments over whether it’s legal to ask passengers on all kinds of transit for proof of payment.
Data from 2015-19 showed that Black riders were disproportionately cited and punished for fare evasion, especially as the issue escalated into the court system. Fifty-seven percent of misdemeanors for fare evasion were issued to Black riders, who make up just 9% of riders.
Sound Transit’s board is still considering how it would like to reform the system of enforcement. On Thursday, Sound Transit leadership offered several recommendations.
One change would increase the number of warnings — from one to four — issued to passengers before they’re given a citation for $124. The third and fourth warnings would come with “administrative fines” of $50 and then $75 that could be satisfied through loading that money onto an ORCA card. Sound Transit would retain the right to refer infractions to court, but only after the fifth time.
At the same time, Sound Transit leadership recommended reducing the cost of youth and subsidized fares to $1 from $1.50, an effort to increase how often passengers are tapping their cards before boarding. Leadership also recommended expanding access to ORCA LIFT cards that allow low-income riders to pay a reduced fare.
“We have work to do to figure out what are the best ways to get to have a successful marketing campaign to get eligible riders signed up,” acknowledged Rogoff.
Board members did not give an immediate timeline for when they would take action on a new fare enforcement system.