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Center Identification Number:  527-04

Project Title:  Impacts of Transfer Fares on Transit Ridership and Revenue

Principal Investigator:          

Fabian Cevallos, Senior Research Associate                                 

813-974-3120

E-mail:  fabian@cutr.usf.edu

Institution:                                                     

Center for Urban Transportation Research

University of South Florida

Tampa, Florida

External Project Contact:     

Tara Bartee, Public Transit Planning Administrator

I.  Project Objectives                             

To investigate how transit transfer fares and policies  affect ridership and revenue, and to examine the reasoning for the implementation of these fares as it pertains to policy, budgetary, and operational issues.  To present currently used methodologies and techniques and to research the state of the art practices related to impacts of fare structure changes.  Finally, to develop a framework and recommendations to assist transit agencies in the evaluation of transfer fare and policy changes as a tool for decision making.

II.  Project Abstract

Transfers are used by the transit industry to allow passengers to move between routes in the system.  This gives the riders flexibility to reach locations that are not provided by a direct connection, which due to cost constraints and system design are not always possible.  However, using transfers as part of the fare structure creates additional burden on the operator that collects the fares, the agency that provides the media and the bookkeeping, the rider that pays for the transfer, and the additional time added to the trip due to the transaction.  Transfer policy aside from the fare can be complex.  How long is the transfer usable?  What are the policies for transfers between modes?  What is the transfer media?  How do you track transfers in your system?  An easier approach might be to eliminate transfer fares altogether, however it is not clear what are the short-term and long-term impacts on revenue and ridership.  Proponents of free transfers and those who advocate eliminating or charging for transfers usually rely on assumptions, which are not based on a systematic methodology.  The need for research investigating the impacts of transfer policy and fares on revenue and ridership is imminent.

III.  Task Descriptions

This project will include five distinct tasks designed to achieve the objectives listed above.  Each task is described below.

Task 1:  Review of the Literature pertaining to Transfer Policy/Fares

The investigators will review and summarize previous studies related to transfers.  A vast amount of research has been dedicated to exploring fare policies and the impacts of fare structure changes on transit revenue and ridership. 

The results of this task will inform the development of a topic guide for the conduct of surveys to transit agencies.  The results of these studies will be summarized, along with the results of Task 2 (described below), in Technical Memorandum 1.

Task 2:  Identify currently used methodologies

Based on results from the literature review and peer-to-peer discussions, a series of currently used methodologies will be identified.  This will include, but not limited to, procedural frameworks as well as qualitative evaluation using different fare elasticities.  Special attention will be given to the reasoning behind the selection of these methodologies:  in particular, policy considerations, budgetary, and operational issues.

Deliverable:    Technical Memorandum 1 – Literature Review and Current Methodologies Results

Task 3:  Develop and Administer Questionnaire to Transit Agencies

Based on the findings from Tasks 1 and 2, the investigators will develop and administer a questionnaire survey instrument to determine the specific components of and issues faced by transit agencies on the implementation of transfer policy/fare changes.  Specific topics that will be addressed include operational, budgetary, policy, and efficiency impacts of these changes.  Related issues will also be addressed as they are presented.  Finally, feedback from transit agencies related to motivation, methodologies, and political issues will be considered.

Task 4:  Conduct Survey of Transit Agencies

This task consists of the development and conduct of surveys with transit agencies that have implemented changes in transfer policy/fares.  The purpose of the survey will be to collect information related to the nature of any relationship between revenue and ridership due to changes in the transfer policy and fare structure as well as the agency motivation to implement such changes.  In addition, key personnel will be interviewed regarding customer characteristics, agency objectives, and methodologies used during this process.  Finally, the survey will be used to gather pertinent lessons learned from the selected transit agencies.

Deliverable:    Technical Memorandum 2 – Synthesis of Survey and Interview Results: Lesson learned from Transfer Fares Changes in the US

Task 5:  Develop Best Practices Report

The final task of the research will synthesize the results of all previous tasks in order to develop a report on the Best Practices in the evaluation of transfer policy/fare changes.  The report will highlight programs that have been successful, as well as document challenges facing these types of fare structure and policy changes.  The report will seek to isolate specific characteristics or conditions that contribute to success, as well as those that present challenges to overall effectiveness and success.  In addition, the report will offer recommendations related to the appropriateness of changing transfer fares/policy and the relevance of future technologies.  Finally, overall recommendations on the best way to apply the proposed methodology, to effectively measure the impacts of transfer fares on ridership and revenue, will be presented.

IV.  Project Schedule, Milestones

Project Start Date: 

V.  Project Budget

Notes: The project team will include faculty, students, and secretarial and other support staff who will work directly on the project and whose costs are reflected in the direct costs of the project as listed above.
 

VI.  Student Involvement

Graduate students will be used to assist in the review of pertinent literature, identification of currently use methodologies, preparation and analysis of qualitative data collection steps, conduct the surveys of transit agencies, data analysis, and preparation of materials for the final report.

VII.  Relationship to Other Research Projects

This project will draw on the experience and knowledge gained through the vast research that has been conducted related to operations planning and fare policy and elasticities. 

VIII.  Technology Transfer Activities

The results of this analysis will be provided to the FDOT through a series of technical memoranda and a final report, as outlined above.  Copies of the final report will be provided to the Research Office, the State Public Transportation Administrator, the Manager of the Transit Office, APTA, and the transit systems that participated in the analyses.  Information will also be made available thought the CUTR website and through presentations at local and national conferences.

IX.  Potential Benefits of the Project

The benefits of the project include the dissemination of information related to the state of the art in the evaluation of transfer policies and transfer fare changes.  In addition, this research will allow Florida and other national transit agencies to effectively assess the impacts of these changes on revenue and ridership.  Finally, the research will assist Florida and other government agencies, consultants, and researchers that are interested in the development, implementation, and evaluation of the impacts of transfer fares changes.

X.  TRB Keywords

Transfer fares, fare structure, fare elasticities, public transportation, transfer policy.

National Center for Transit Research · at the Center For Urban Transportation Research · University of South Florida · 4202 E. Fowler Ave., CUT100 · Tampa, FL 33620-5375 · (813) 974-3120 · (813) 974-5168 · www.nctr.usf.edu · Comments: webmaster@cutr.eng.usf.edu