Transit Agencies Dangle Discounts and Perks to Woo Riders

When the COVID-19 pandemic hit in March 2020, ridership plummeted on Green Mountain Transit, Vermont’s largest public transit agency.

“Like just about every transit agency in the country, the demand for transit disappeared,” said Jon Moore, general manager of the agency, which runs buses in five northwest Vermont counties.

Officials knew they needed to do something. So they made all bus service free, at least temporarily. At first, the idea was to help protect drivers from COVID-19 by allowing passengers to board at the rear door as well as the front door, bypassing the farebox in either case.

As time went on, officials kept the zero-fare plan going to entice riders to return. They paid for the first two years with federal pandemic relief money and recently got state funding through June 2023.

Across the country, transit agencies are trying to deal with reduced ridership, revenue losses and teleworking by making changes aimed at luring riders back and attracting new ones.

Some agencies are eliminating or reducing fares or making weekly or monthly transit passes cheaper. Some have redesigned routes or extended service during off-peak hours and weekends. Some are dangling perks, such as gift cards or sweepstakes.

In San Francisco, Bay Area Rapid Transit is even sponsoring a contest asking riders to submit short stories that revolve around the theme “motion.” Finalists will get a $200 honorarium.

“It’s a challenging time. The industry hasn’t faced a situation where they’ve had to reduce service and see ridership drop like this,” said Chad Chitwood, a spokesperson for the American Public Transportation Association, a trade group. “It’s a time when they need to think about how they’re going to serve their communities going forward.”

In Vermont, ridership on Green Mountain’s urban routes now has reached 76% of pre-pandemic levels. Commuter routes are at 33%.

“It’s hard to say whether zero fare has built back ridership,” Moore said. “With fuel prices at record highs, that always drives ridership. But with teleworking and COVID, it’s hard to wrap our heads around what the trend data actually mean.”

In New York, the Metropolitan Transportation Authority in March announced a fare capping plan on subways and local buses. Once customers take 12 trips in a week, they’ll automatically ride free for the rest of the week. The agency also offered suburban commuters a monthly unlimited pass and a discounted 20-trip ticket.

And last month, the agency teamed up with the James Beard Foundation to sponsor a sweepstakes that offered riders a chance to win restaurant gift cards, overnight stays at hotels and tickets to a wine and food festival.

In the Boston area, the Massachusetts Bay Transportation Authority launched a pilot program called “Flex Pass” on its commuter rail in July 2020. It offered riders a cheaper, bundled fare good for any five days of travel within a 30-day period. The fare proved popular and was made permanent in March.

Big Challenges

Public transit has had a rough time during the pandemic. In the early months, ridership dropped by nearly 80% nationally as commuters worked remotely, transit agencies enforced social distancing and riders stayed away to protect their health.

While ridership numbers have gradually climbed, they were still down 48% nationally as of the week ending June 4, according to the American Public Transportation Association.

Part of the problem is that millions of Americans have transitioned to telework; they may be commuting fewer days or not at all.

Many transit agencies rely on farebox revenues to stay afloat. While Congress offered help by passing three COVID-19 relief measures together allotting nearly $70 billion to transit agencies, it was still just a stopgap, officials say.

Agencies have been using those federal dollars to keep operating, but most say that within the next year or two, that money will be gone. And while the new $1.2 trillion federal infrastructure law includes nearly $107 billion for public transit and $102 billion for commuter rail, Amtrak and high-speed rail, that money is primarily for capital expenses—not operating costs.

Agencies say they still need to have a steady revenue stream and bring back riders or attract new ones.

In Chicago, where the regional Metra commuter rail system is offering a new, cheaper monthly pass, spokesperson Michael Gillis said high gas prices also might help move people from cars to public transit. “If we can make our fares that attractive, we think it’s a good time to try this.”

Given the popularity of telework and hybrid work, the agency also has adjusted its schedule on some lines to focus less on rush hour and more on off-peak hours and weekends.

“We want people to ride the train for non-work commute trips, like big summer events in Chicago, which are really revved back up,” he said.

While ridership is moving steadily upward, Metra still is at only about 40% of its pre-pandemic numbers, according to Gillis. On June 1, there were 115,000 passenger trips.

Metra hopes to get back to 80% of pre-pandemic ridership by the end of 2024, Gillis said.

Free Parking and Three-Day Passes

In the Philadelphia area, the Southeastern Pennsylvania Transportation Authority, known as SEPTA, also is trying to woo back riders.

The agency, which runs subways, bus service and commuter rail, took a major hit during the pandemic, but ridership has been rising steadily on the urban lines and is now at 53% of pre-pandemic numbers, according to spokesperson Andrew Busch. SEPTA’s commuter rail is still lagging, though, at 44% of pre-pandemic levels.

Among some of the changes: Adjusting schedules to add more midday and weekend service and making parking free at SEPTA-owned lots. The agency also created a three-day pass targeted at people who work hybrid schedules.

SEPTA is particularly hopeful about its Key Advantage Program, a pilot with three major employers—Penn Medicine, Drexel University and Wawa—that are offering free transit passes to employees as a benefit. The employers pay SEPTA a fixed rate of about $140 per pass.

Busch said about 15,000 employees are eligible under the pilot, and approximately 7,000 are using the passes to ride on SEPTA. The agency hopes its board will make the program permanent in July and expand it to other large employers.

“It’s a new revenue stream and one that we think can grow over time,” Busch said. “Employers are committed to buy these passes every month.”

Even if transit agencies try new things, they’re still going to encounter major challenges, said Hayley Richardson, spokesperson for the TransitCenter, a nonprofit research and advocacy group based in New York.

Agencies must figure out ways to make themselves more useful to people for non-work trips, she said. They also should improve service and make it convenient for essential workers who have shifts that often aren’t 9 to 5, she added.

“A lot of these riders who have stuck with the system are low income and could benefit from agencies rolling out free fares and reduced fares for low-income people,” she said.

Even so, it’s unlikely large agencies that rely on revenue from white-collar workers will return to 100% of pre-pandemic ridership before federal relief money runs out, according to Richardson.

There’s only so much those agencies can do with fare discounts and better service, she said, adding that they’re going to have to tap new revenue sources at the state or local level, such as additional taxes. “This is going to become a big problem for agencies fairly soon, if not next year, then the year after.”