Last week, I was getting on the bus and I noticed something uncanny: almost no one was paying fare to get on the bus. I thought perhaps this was a remnant from the COVID era when they suspended bus fares to maximize social distancing between the bus driver and passengers. Alternatively, I thought people skirting fare payment was another symptom of higher crime here in the Washington D.C. area. It very well could be neither one of those things. In December 2022, the D.C. Council unanimously approved eliminating the $2 bus fare for all D.C. buses, which made D.C. the largest U.S. city to implement zero-fare buses.
This plan was to take effect in July 2023. However, it was in May 2023 that the Washington Metropolitan Area Transit Authority (WMATA) asked that the plan be delayed for a year. As of date, WMATA still shows the $2 charge on its website. Fare evasion has become an issue to the point where the D.C. Council is trying to pass a bill to step up fare evasion enforcement. Regardless of whether WMATA approves the elimination of bus fares begs the question of whether the idea of free-fare buses are wise transit policy.
The premise behind offering zero-fare transit is to boost declining ridership. There are some who view zero-fare buses as a way to improve transit access to lower-income individuals. Zero-fare buses do indeed increase ridership. You would hope that giving something away at no cost to an end-user would increase usage. In spite of increased ridership, zero-fare buses did cause other unintended consequences.
As the 2012 National Academies report entitled Implementation and Outcomes of Fare-Free Transit Systems points out, increased ridership also increased delays, overcrowding, and "problem passengers." The increased rowdiness from these "problem passengers" could actually increase a need for security services that exceed the contact between law and enforcement and riders for evading fares (e.g., Studenmund and Connor, 1982). These are actually some of the reasons why Austin and Denver abandoned their free-fare transit.
Another argument for the policy is to divert people from using their cars in favor of public transit, which would help with carbon emissions. A third rationale would be to ease bottlenecks on already-congested transport networks. To quote the Left-leaning news outlet CNN, "fare-free supporters also hope dropping fares will improve congestion, carbon emissions, and noise pollution from cars by getting more drivers to take transit. But results from European cities reveal little evidence it accomplishes these goals."
A September 2020 study from the International Association of Public Transport showed this lack of evidence by concluding that "there is no evidence that free fare public transport (FFPT) alone is not enough to bring about modal shift, social inclusion, and economic development to a city." The lack of modal transfer was observed in the Estonian capital of Tallinn (Cats et al., 2017), as well as Trenton, New Jersey and Denver, Colorado (Studenmund and Connor, 1982).
Then there is the ill-conceived notion that this would actually be free. As Nobel Prize economist Milton Friedman was fond of saying, "there is no such thing as a free lunch." Scarcity is a key concept in economics because we live in a world of limited resources. As such, supply will almost always, if not always, exceed demand for a good or service. Part of economics is to find ways to best allocate limited recourses in the midst of scarcity.
Public transit is no exception and couching support for zero-fare buses in terms of "return on investment for empathy, compassion, and social equity" does nothing to skirt that reality. As a matter of fact, the reason why WMATA asked for a delay for zero-fare buses is because WMATA is anticipating a $750 million budgetary shortfall in 2025. I could hear a clamoring for increased taxes to help pay for zero-fare buses. Here is the thing: a March 2022 report from the Congressional Budget Office (CBO) pointed out that two-thirds of the income for transit agencies comes from government sources (i.e., taxation). Budgetary woes were an issue for transit agencies across the United States pre-COVID. The pandemic only exacerbated these shortfalls. Zero-fare advocates cannot contend that lost funds need to be recuperated somehow.
Zero-fare systems deprive transit systems of funds that they can use to improve quality of service. According to a 2019 survey of transit riders across multiple U.S. cities from transit advocacy group TransitCenter, the main area of improvement identified by transit riders was quality of transit services. Concerns about fares were much lower on this list of priorities. This lines up with WMATA survey results from Fall 2022 that indicated that fast, frequent, and reliable service are top priorities for WMATA passengers.
Much like with bans, a blanket zero-fare policy are a blunt instrument that causes further damage to the transit system that they are trying to save. Using zero-fare systems to deprive transit agencies of much-needed revenue would plausibly make transit less reliable, less frequent, and less safe.
Ideally, I would have transit be privately owned, operated, and funded (also see Cato Institute analysis here). Short of that, you could have a targeted fare policy in which you offer lower-income household reduced fares to balance transit agency budgetary concerns with access to public transit. Unfortunately, I see the zero-fare crowd gaining traction because it is an easy political win that does nothing to help improve bus service quality or the budgetary woes of transit agencies.
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