IMPACT ON TRANSIT RIDERSHIP AND REVENUE OF REDUCED FARES FOR THE ELDERLY

A DEMONSTRATION OF REDUCED TRANSIT FARES FOR ELDERLY PASSENGERS IS EXAMINED TO ESTIMATE THE IMPACT ON RIDERSHIP AND REVENUE. THE PROJECT WAS UNDERTAKEN IN PITTSBURGH DURING 1970; FARES FOR ELDERLY PERSONS HOLDING SPECIAL IDENTIFICATION CARDS WERE CUT BY 15 CENTS FOR OFF-PEAK AND WEEKEND RIDERS. THE NEARLY 60% OF ALL ELIGIBLE CUSTOMERS (NUMBERING ALMOST 79,000 PERSONS) REGISTERED TO PARTICIPATE IN THE REDUCED FARE EXPERIMENT. ALL RELEVANT ASPECTS OF THE PROJECT ARE DOCUMENTED WITH REFERENCE TO BACKGROUND AND SURVEY METHODOLOGY. RESULTS ARE OUTLINED FOR OVERALL RIDERSHIP (BEFORE AND AFTER), PEAK-HOUR, OFF-PEAK, AND PROJECTED RIDERSHIP. EXPECTED RIDERSHIP PRIOR TO IMPLEMENTATION OF REDUCED FARES WAS A MONTHLY 5.73 ROUND TRIPS PER PASSHOLDER. AVERAGE RIDERSHIP UNDER THE PLAN, HOWEVER, ROSE TO NEARLY SEVEN ROUND TRIPS PER MONTH. OFF- PEAK RIDERSHIP ROSE SUBSTANTIALLY AT THE EXPENSE OF DEMAND DURING PEAK-HOURS. MORE THAN 1.1 MILLION NEW TRIPS WERE ESTIMATED TO HAVE BEEN GENERATED BY THE FARE REDUCTION. NET REVENUE LOSSES TO THE TRANSIT SYSTEM WERE APPROXIMATELY $628,900. THE DIVERSION OF PEAK-HOUR RIDERSHIP (WHEN TRANSIT PRODUCTIVITY IS HIGHEST) AND REVENUE LOST ON THE VOLUME OF BASE DEMAND OFFSET GAINS FROM THE OTHERWISE HIGHER NUMBER OF TRIPS. HOWEVER, INTANGIBLE SAVINGS MAY HAVE BEEN GENERATED WHICH ARE NOT REFLECTED BY COMPUTATIONS OF NET FAREBOX LOSSES. A FRAMEWORK FOR BENEFIT-COST ANALYSIS OF THE REDUCED FARE DEMONSTRATION IS OUTLINED BRIEFLY. REPRODUCTIONS OF THE SURVEY INSTRUMENT AND RELEVANT COMPUTER PRINTOUTS ARE APPENDED. /UMTA/