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SR 10-10-2017 3B City Council Report City Council Meeting: October 10, 2017 Agenda Item: 3.B 1 of 11 To: Mayor and City Council From: Edward King, Director, Big Blue Bus, Transit Planning & Performance Subject: Big Blue Bus Fare Restructure Recommended Action Staff recommends that Council adopt the proposed fare adjustments as follows: decrease the TAP stored value single ride fare from $1.25 to $1.10, introduce a new $500 annual unlimited ride pass, and create new standardized pricing for employer provided fare media (Blue to Business). Executive Summary The primary purpose of this proposed fare adjustment is to refine previous changes made to the Big Blue Bus (BBB) fare structure in support of BBB’s strategic goals of reducing cash fare handling and reducing dwell time during boarding. The proposed change to the TAP stored value single fare from $1.25 to $1.10 for rechargeable TAP cards is expected to achieve a shift away from cash to prepaid fare media. This shift would reduce the time-consuming process of cash boarding, reduce dwell time, and speed up bus service. In addition, staff recommends two other adjustments to the fare structure. The first is the addition of a new $500 annual unlimited ride pass to enhance and streamline fare product sales to employers who subsidize bus fares for employees taking transit. The $500 annual pass is available to the general public, but is expected to be primarily used by employers. The second is to introduce new annual standardized pricing (Blue to Business) for employers who want to subsidize fares for larger groups of employees, including those who may ride transit infrequently. These new annual fare products remove the monthly burden of having to distribute fare products to employees or reload TAP cards on a monthly basis; and, secondly, remove 2 of 11 the monthly decision as to whether to continue to use transit, shifting all of these activities to once per year for those who choose this product. The addition of Blue to Business pricing provides group purchase of passes for employees and is directed at employers looking to encourage more transit use among non-users. Five price points for annual passes are differentiated based on what percentage of employees are supplied passes. Staff presented the detailed fare adjustment proposal at a public hearing held on August 1st, 2017 and at the Disability Commission meeting on October 2, 2017. Staff has summarized the community and customer feedback to the proposed fare adjustments and seeks Council approval of the fare adjustment proposal. If adopted, the new fare adjustments would be effective November 26, 2017. The final recommended action had been to end the practice of allowing Personal Care Assistants (PCAs) travelling with ACCESS certified riders to ride free of charge. Under this proposal, PCAs would have been required to pay a fare, creating greater fare equity across the BBB system. Staff presented this recommendation to the Disabilities Commission on October 2nd, 2017 and has concluded to defer this recommendation until after a full fare analysis has been performed for the next exception-based budget cycle. Background On October 27, 2015, Council unanimously adopted a fare restructure proposal to fund the enhanced service under Evolution of Blue, BBB’s service integration plan for first- last mile connectivity to the Expo Light Rail Line. The underpinning of the proposed fare restructure was to: increase revenue to offset Expo service integration operating expenditures, reduce fare handling and vehicle dwell time operating costs by encouraging use of prepaid period passes through appropriate pricing, and minimize ridership loss by providing a range of attractively priced options. 3 of 11 The fare adjustments went into effect on January 10, 2016 and included the following changes. No changes were made to Senior/Disabled/Medicare reduced fares.  Base Cash Fare increase from $1.00 to $1.25 ($0.25)  Express Cash Fare increase from $2.00 to $2.50 ($0.50)  Token Fare increase from $1.00 to $1.25 ($0.25)  2 Token Express Fare increase from $2.00 to $2.50 ($0.50)  13-Ride Pass increase from $12.00 to $14.00 ($2.00)  Regular 30-Day Pass decrease from $60.00 to $50.00 (-$10.00)  Youth 30-Day Pass decrease from $40.00 to $28.00 (-$12.00)  Express 30-Day Pass increase from $80.00 to $89.00 ($9.00)  New Rolling 7-Day Pass (Local) for $14.00 Subsequent to the fare change, on January 1, 2017, as a result of a later Council action taken in December 2016, the Youth 30-Day Pass price was further decreased from $28.00 to $19.00. The fare adjustments proposed in this staff report are intended to further refine the fare structure in support of the goals previously identified in the October 2015 fare restructure. Discussion The proposed fare adjustments continue the pursuit of goals identified in the fare restructure approved in 2015 and implemented in 2016. Those goals included reducing fare handling to speed up transit travel time by encouraging use of prepaid period passes through incentivized pricing, minimizing ridership loss by providing a range of attractively priced options, and increasing revenue to offset Expo service integration operating expenditures. Reduction of TAP Stored Value Single Ride Fare on Rechargeable TAP Cards from $1.25 to $1.10 4 of 11 The 2016 changes to the fare structure were successful in attracting some customers away from cash. The portion of customers who pay with cash declined from 50% at the conclusion of FY2014-15 to 44% at the conclusion of FY2016-17, reducing cash handling and vehicle dwell time. This proposal seeks to further reduce cash transactions from 44% to 15%, replacing them with TAP transactions. Cash customers require an average of 23 seconds of dwell time to complete payment, while a prepaid customer using a magnetic stripe card or smartcard requires less than 4 seconds on average to pay for their ride. The benefit of reducing cash transactions from 44% to 15% of all boardings is an expectation of an overall increase in travel speed of approximately .5 mph across the system. This increase in travel speed translates to a reduced operating cost of approximately 55 cents per customer per ride. Reduced cash handling and dwell time not only benefit BBB, but also provide a significant benefit to customers. Recent ridership reductions have strengthened the argument for exploring the question as to what can make BBB services more attractive to customers. BBB customer surveys have confirmed that the single largest complaint regarding BBB service is the excessive time it takes to travel by bus. In the open ended question “What is the most important thing BBB could do to improve your experience?”, 81% of respondents cited some aspect of travel time as being the most important place for improvement. The significantly longer boarding time of cash customers produces a drag on system efficiency, as all customers must wait for each transaction to complete before the bus can move forward. Increasing the number of customers using prepaid fares through discounting of passes enhances the attractiveness of transit, while simultaneously lowering the cost of operating the routes on a per customer basis. When examining strategies for attracting customers away from cash and towards prepaid fare media, BBB customers have expressed an overwhelming preference for paying with stored value on TAP, which is now the prevailing way to pay when customers are choosing between all publicly available fare products. TAP stored value is not only the most commonly chosen way to pay one’s fare, it also continues to attract 5 of 11 new riders. Ridership using this method of payment on BBB is up 51% in fiscal 2017 over fiscal 2016, and is close to one million riders annually. Reduction of the single ride fare on TAP stored value is expected to attract two-thirds of remaining cash riders, many of whom currently have access to TAP stored value but do not use it on BBB as there is no economic advantage to doing so. The net immediate impact of this change will be a short-term annual reduction in fare revenue as customers pay less fare using TAP stored value. However, it is a reasonable assumption that the new lower fare of $1.10 will attract new customers that do not currently ride BBB. Adding an Annual Unlimited Ride Pass and Standardized Pricing for Employers Providing Group Purchase of Fares for Employees (Blue to Business) Big Blue Bus staff has conducted a thorough review of its pricing structure and recommends introduction of an annual unlimited ride pass sold individually, as well as Blue to Business, a pricing structure for employers who wish to supply annual passes to employees, both those who use transit regularly and those who use transit infrequently, to encourage more use. The need for transit pass alternatives was identified through discussions with the Transportation Demand Management staff of the City of Santa Monica, who noted that the monthly pass distribution or monthly TAP reload process is cumbersome for employer subsidy programs and long-term transit users. The tedious process invites discontinuance of transit use by re-engaging consumers on a monthly basis about their transit choice. Annual unlimited ride passes address these concerns by facilitating easy provision of employer transportation benefits, removing the monthly workload of pass distribution or TAP re-loading, and avoiding the month-to-month decision making of employers and employees as to whether they should continue with the benefit. 6 of 11 The price of $500 for annual passes sold individually (ten times $50 monthly price) instead of $600 (twelve times $50 monthly price) takes into account two important considerations. Many employers, including the City of Santa Monica, exercise restraint in buying transit passes and elect not to buy a monthly pass for an employee who takes vacation or is otherwise absent in any given month, and instead purchase other fare products. As such, many employers do not buy twelve monthly passes for their employees. The second consideration is that employers have an expectation that committing to an annual pass will bring them some cost benefit over what they are currently spending to support an employee with transit subsidy for a full year. The standardized Blue to Business pricing for employers making group purchases of passes for employees is designed for employers who wish to encourage more transit use amongst employees who may only infrequently use transit or not use it at all. Typically, if an employer provides transit passes to only those employees who use transit, it is to less than 15% of employees. The Blue to Business pricing discounts bus passes based on the percent of employees supplied a pass, beginning at 15% of all employees. Price incentives are also available for 30%, 50%, 75% and 100% of all employees supplied transit passes. This pricing enables employers to provide unlimited use transit access to more employees at low cost, on the assumption that as one provides more passes, transit use per pass diminishes. This pricing structure uses known ridership patterns at other employers to determine appropriate price points for each percentage level (see Blue to Business Attachment E for detail). Employers will be required to commit to 12 months of purchase in order to qualify for Blue to Business pricing and will be provided a 12-month pass for each employee. Employers will be able to adjust percentages of employees supplied passes at their annual renewal date. The Blue to Business program aims to provide flexibility that serves not only employers but also Big Blue Bus. The intention behind the pricing is that Big Blue Bus obtain the same revenue per ride as cash fare (currently $1.25) for each ride provided. At the end 7 of 11 of each calendar year, the prices charged at each percentage point will be adjusted for the new year based on ridership activity in the prior year. Pricing will be raised or lowered in order to keep revenue per ride in alignment with the current base fare. Pricing for individual employers will be adjusted as each employer contract renews. Charging a Fare to Personal Care Assistants Travelling with ACCESS Services Clients Through a contract with ACCESS services, people certified as ACCESS services eligible currently ride BBB without paying a fare by tapping their ACCESS Services ID card on the TAP light validator. BBB then records these rides and bills ACCESS Services a 50 cent discounted fare for each ride. Some ACCESS services clients travel with Personal Care Assistants, who under current BBB policy do not pay a fare. Those riders do not carry an ACCESS services TAP card, are not certified through ACCESS, and do not board with any fare product under BBB policy. The rides taken by Personal Care Assistants are not reimbursed by ACCESS. Staff initially proposed charging the regular adult fare to ACCESS Personal Care Assistants because the current policy is problematic in that it sets up an inequity between Personal Care Assistants and all other people who are expected to either pay their fare, or are supported by another organization that pays their fare on their behalf, such as ACCESS Services, Santa Monica College, or the rider’s employer. The current policy also sets up an inequity between PCAs who do not pay a fare when riding with ACCESS certified disabled customers and PCAs who are charged a regular fare while riding with non-ACCESS certified disabled customers. Requiring all Personal Care Assistants to pay a fare regardless of what fare type the disabled customer travels with would eliminate this inequity. Title VI Civil Rights Considerations The revision of the price of a TAP stored value ride from $1.25 to $1.10 is subject to a fare equity analysis as defined by BBB’s Major Service and Fare Change Policy. The 8 of 11 fare equity analysis is required to ensure compliance with the Federal Transit Administration (FTA) Title VI regulations as defined by FTA Circular 4702.1B. The purpose of the analysis is to determine whether the proposed changes will result in a disparate impact on the basis of race, ethnicity, or national origin, or a disproportionate burden on the low-income population. Based on the thresholds set in the stated policy, minority customers would not experience a disparate impact as a result of the revised fare structure, nor would low- income customers experience a disproportionate burden as a result of the revised fare structure. Communication Plan Communication regarding the proposed new fares and fare media began on June 30, 2017. BBB staff communicated the details of the public hearing and invited the public to participate and provide feedback via the following strategies:  BBB website feature and detailed webpage  Transit Mall digital kiosk ads in Downtown Santa Monica  Transit Store ad  Transit Store take-one brochure  Bilingual onboard flyer  Bilingual onboard take-one brochure  BBB email alerts (three)  Social media posts on BBB Facebook, Twitter, and Instagram  Santa Monica Daily Press newspaper ad notices (two dates)  Media advisory  City of Santa Monica website feature  City of Santa Monica social media posts Engagement & Communication Timeline  June 30, 2017 – public awareness campaign launch 9 of 11  August 1, 2017 – public hearing held at Main Library  October 2, 2017 – Disability Commission meeting presentation of proposal  October 10, 2017 – Consent calendar staff report to Council recommending approval of fare adjustment proposal  November 26, 2017 – fare restructure implementation date Public Hearing and Feedback The fare restructure public hearing was held on August 1, 2017 at the Santa Monica Main Library. Eighteen members of the public signed in and approximately seven additional individuals joined without signing in after the hearing started, for a total of approximately 25 attendees. In addition, nine BBB staff members were present. Transit Director, Ed King, presented the proposed fare restructure and conducted a question and answer session at the end of his presentation. Analysis of Public Comment All public comments were reviewed in light of the recommended action. Feedback received as of 08/12/17 (comment period end date): 1) A total of 18 stakeholders made verbal comments at the public hearing. Fewer than half of the comments related to the proposed fare adjustment. Recurring themes included the suggestion to reinstate BBB to BBB transfers, disapproval of the elimination of a BBB token option, and increased TAP vendor locations/convenience. 2) Five comments were received on paper at the hearing. Two of these comments were unrelated to the fare proposal. All of these reflected the sentiments from the verbal comments received and were centered around improvements to the TAP system and the reinstatement of BBB to BBB transfers. 3) Nine comments were received via the GO system. Seven of the nine comments were related to the proposed fare adjustment. Recurring themes included, the 10 of 11 suggestion to reinstate BBB to BBB transfers, the ability to exchange BBB tokens for 1-Ride passes, the high cost of the annual pass, and the ability to pay the Rapid 10 upgrade fee using TAP. Disability Commission Meeting and Feedback Staff attended the regular monthly meeting of the Disability Commission on Tuesday, October 2, 2017 at the Ken Edwards Center. There was a quorum of Commissioners present, Commission staff, and one BBB staff member who presented on the fare adjustment proposal focusing on the recommendation to implement the regular fare of $1.25 for Personal Care Attendants. BBB staff presented that the current policy of allowing PCAs to ride without paying a fare on fixed route is not mirrored at other surrounding transit agencies, that the policy creates opportunities for abuse, and that it creates an inequity as this benefit does not exist for PCAs traveling with Dial-a-Ride customers or customers riding through Senior/Disabled/Medicare fares on BBB. Commissioners heard the presentation, but expressed concern regarding charging PCAs. Understanding the Commissioners’ concerns, staff will revisit this recommendation in conjunction with a total fare analysis of fixed route and Dial-a-Ride fares in preparation for the next exceptions-based budget. Financial Impacts and Budget Actions In the former transit marketplace, forces such as changes in fare were well understood and could be easily interpreted to cause predictable outcomes. However, with the recent national downturn in bus ridership, and the new entries into the transportation marketplace such as transportation network companies (TNCs), these causal relationships are now harder to predict. Staff can predict with some certainty that reducing fares would reduce short term revenue by approximately $697,000. However, providing accurate predictions of increased ridership and the associated revenue due to reduced fares is more of a challenge given recent trends. 11 of 11 Given elasticities of demand that have long held true in public transit, the changes to the base fare on TAP and the $500 annual pass would be expected to generate an additional 216,000 riders generating $239,000 additional revenue for Big Blue Bus, offsetting the short term losses. The introduction of Blue to Business fares would be expected to generate another 102,000 annual rides in the first year and $127,500 in new fares associated with those rides. The effect of these changes would be a net loss of $330,500 annually in fare revenue and an increase of approximately 318,000 riders in the same year. Big Blue Bus will monitor the effects of these changes and report back to Council 12 months after implementation to report on the full financial impacts. Revenues will be adjusted as needed during the FY2017-18 mid-year budget process. Prepared By: Timothy McCormick, Transit Planning and Performance Manager Approved Forwarded to Council Attachments: A. Title VI FTA Circular B. BBB Title VI Fare Equity Analysis C. Big Blue Bus Fare Restructure Staff Report October 27, 2015 D. Two-Year Pilot Reduced Fare Program for Youth and Students December 6, 2016 E. Blue to Business Pricing July 2017 F. Public Hearing Customer Comments G. Written Comments Table of Contents Purpose ..................................................................................................................................... 3 Executive Summary ................................................................................................................... 3 Background ................................................................................................................................ 3 Existing Fare Structure ............................................................................................................... 4 Proposed Fare Structure Changes ............................................................................................. 6 Methodology .............................................................................................................................. 6 Data Sources .......................................................................................................................... 6 Definitions .............................................................................................................................. 7 Title Vi Policies ....................................................................................................................... 7 Fare Equity Disparate Impact Policy: .................................................................................. 7 Fare Equity Disproportionate Burden Policy: ....................................................................... 8 Fare Equity Analysis .................................................................................................................. 8 Disparate Impact Analysis ...................................................................................................... 8 Disparate Impact Findings .................................................................................................. 8 Disproportionate Burden Analysis ..........................................................................................10 Disproportionate Burden Findings ......................................................................................10 Further Actions ......................................................................................................................12 Conclusion ................................................................................................................................12 Appendix ...................................................................................................................................13 Purpose Big Blue Bus (BBB) is proposing a reduction in the TAP stored value fare to encourage riders to switch from on-board cash fares to prepaid TAP fares. The TAP stored value fare is equivalent to the cash fare and allow riders to pay for each ride with a TAP smartcard loaded with a cash balance. Under the current fare structure, the cost per ride on TAP stored value versus the on- board cash fare is the same. The proposed fare change would benefit existing and future riders that use stored value by providing a reduced cost per ride. On-board cash fare riders slow down the boarding process as a result of the time required to physically insert the necessary bills and coins into the farebox. The resulting delay in service has a substantial negative impact on rider experience, on-time performance and operating costs across the system. Increased smartcard adoption will benefit all BBB customers through reduced dwell times, improved reliability, and better on-time performance. These benefits will ultimately result in faster travel times and will allow BBB to provide a more competitive transportation alternative to the automobile. Increased smartcard use will also diminish cash transactions, which will alleviate potential farebox malfunctions that result from heavy, everyday use by cash paying customers. The proposed fare reduction is subject to a fare equity analysis as defined by BBB’s Major Service and Fare Change Policy. The fare equity analysis, contained herein, is required to ensure compliance with the Federal Transit Administration (FTA) Title VI regulations as defined by FTA Circular 4702.1B. The purpose of this analysis is to determine whether the proposed changes will result in a disparate impact on the basis of race, ethnicity, or national origin, or a disproportionate burden on the low-income population. Executive Summary Title VI of the Civil Rights Act of 1964 prohibits discrimination on the basis of race, color, or national origin in any program or activity that receives Federal funds or other Federal financial assistance. In compliance with this law, Big Blue Bus has conducted a Title VI analysis on the proposed fare change. This analysis has found that the revised fare structure does not result in an adverse disparate impact on the minority population or an adverse disproportionate burden on the low-income population. Background Over the past two years, the BBB route network was reconfigured to improve transit connections with the Metro Expo Line, which was extended to provide rail service at an additional seven stations within the BBB service area. As a transportation alternative to the congested I-10 freeway, the Expo Line has generated substantial ridership at each of the seven new stations since opening on May 20, 2016. Having completed the reconfiguration of the route network, BBB is now focused on improving the quality of service by offering a more attractive transportation product to existing and future transit customers. The proposed reduction in the TAP stored value fare, and the associated cost and time savings, is one measure in BBB’s overall effort to improve the quality of service. Existing Fare Structure BBB fares vary based on rider classification, service classification (Local or Express), and fare category. Rider classifications include: Regular (age 19-61), Youth (age 5-18), Senior (age 62+)/Disabled/Medicare, and Children (age 4 and under). Service classifications include: Local (all routes excluding Rapid 10) and Express (Rapid 10). Fare categories include: Cash, Token, Day Pass, 7 Day Pass, 13 Ride Pass, and 30 Day Pass. Each of these three factors will determine the price paid by each customer. The current BBB fare structure went into effect on January 10, 2016. Under the 2016 changes, the base cash fare was increased by $0.25 to $1.25, the express cash fare was increased by $0.50 to $2.50, the 13 ride pass was increased by $2.00 to $14.00, the regular 30-day pass was decreased by $10.00 to $50.00, the 30-day youth pass was decreased by $2.00 to $38.00, the express 30-day pass was increased by $9.00 to $89.00, and a new 7-day local pass was created at a price of $14.00. Rider Classification Fare Category Existing Price Regular Cash Local $1.25 Cash Express $2.50 Day Pass $4.00 7 Day Pass $14.00 13 Ride Pass $14.00 30 Day Local Pass $50.00 30 Day Express Pass $89.00 Senior /Disabled /Medicare S/D/M Cash Local $0.50 S/D/M Cash Express $1.00 S/D/M Day Pass $1.50 S/D/M 13 Ride Pass $6.00 S/D/M 30 Day Local Pass $24.00 S/D/M 30 Day Express $40.00 Youth Youth 30 Day Local Pass $38.00 All Token Local (1 token) $1.25 Token Express (2 tokens) $2.50 Access ID Free EZ Pass Transfer Free Interagency Transfers $0.50 Santa Monica College ID Free UCLA Flash Pass / BruinGo! Free / $0.50 Children Free fare (age 4 and under) Free Figure 1: Existing BBB Fare Structure According to the most recent fare utilization data, 45% of all BBB riders pay with cash, 23% of all riders are UCLA and Santa Monica College students, and the remaining 32% of all riders are spread across the other fare categories. BBB issues passes in two fare media types, either on TAP or on the magnetic swipe / trim dip passes sold by BBB. TAP usage currently represents 26% of all riders. Cash 45% Token 1% Day Passes 3% 30 Day Passes 4% 13 Rides 1% 7 Day Passes 1% Transfers 5% Santa Monica College 13% UCLA 9% TAP Access/Access 5% TAP Ezpass 5% TAP Stored Value Cards 7% Free Rides 1% YTD Ridership FY16-17 Percentage by Fare Cateogory Proposed Fare Structure Changes BBB is proposing a revised fare structure that will reduce the existing price of the TAP stored value fare from $1.25 to $1.10. The proposed $0.15 reduction is expected to result in an increase in ridership and a subsequent decrease in revenue. All other fares will remain unchanged. The proposed reduction in the TAP stored value fare is expected to shift riders from cash boardings to pre-paid or pass boardings. Increased smartcard adoption will benefit all BBB riders through reduced dwell times, improved reliability, and better on-time performance. Using the Simpson-Curtin Formula to estimate the effect of the proposed change, ridership is expected to increase annually by 211,173 riders and revenue is expected to decrease annually by $453,588. The revised fare structure is expected to reduce cash ridership to approximately 22%. Methodology Data Sources The fare equity analysis was completed using passenger survey data from the January 2016 Big Blue Bus Customer Perception Survey. Cash 45% TAP 26% Magnetic Swipe or Trim Dip 19% Cash Purchase of Magnetic Pass on Bus 1% Flash Pass/Press Key 4% Token 1% UCLA -Cash 50 Bruin Go 4% YTD Ridership FY16-17 Percentage by Fare Media Figure 2: Current Ridership and Revenue The following information was obtained from the customer surveys for use in the fare equity analysis:  Method of fare payment  Rider race/ethnicity  Rider income Rider demographics were combined with the method of fare payment to determine the systemwide, minority, and low-income fare utilization for all methods of payment. The percentage of systemwide fare utilization for cash fares and TAP fares will be compared to the fare utilization by minority and low-income populations. The resulting comparison will establish whether minority or low-income riders are more, or less, likely to use the fare category that would be subject to the fare change. Definitions In performing the fare equity analysis, minority riders have been defined as survey respondents who completed the race/ethnicity question and marked any category besides white-alone. Low- income riders have been defined as survey respondents who completed the income question and listed a household income that was less than $34,999 per year. The income threshold for this analysis was established using the U.S. Department of Housing and Urban Development’s 2016 Adjusted Home Income Limits for Los Angeles County at the “Very Low Income” level. The two persons per household threshold was used as the income level standard that defined the low-income population. The Adjusted Home Income Limits are the same guidelines that Big Blue Bus uses for customers to qualify for the Metro Rider Relief fare subsidy program. 2016 Adjusted Home Income Limits Persons per Household Annual Income 1 $30,400 or below 2 $34,750 or below 3 $39,100 or below 4 $43,400 or below 5 $46,900 or below 6 $50,350 or below Figure 3: 2016 Adjusted Home Income Limits Title Vi Policies As required by the FTA Title VI regulations, the public was engaged in the development of BBB’s disparate impact and disproportionate burden policies. These two policies determine if the revised fare structure will result in a disparate impact or disproportionate burden. Fare Equity Disparate Impact Policy: “A disparate impact occurs when the percentage minority population adversely impacted by a major service change or fare change is fifteen percent (15%) higher than the average minority population of the Big Blue Bus service area, or when the percentage non-minority population beneficially impacted by a major service change or fare change is fifteen percent (15%) higher than the average non-minority population of the Big Blue Bus service area.” (BBB Title VI Standard and Policies, Pg. 9) Fare Equity Disproportionate Burden Policy: “A disproportionate burden occurs when the percentage low-income population adversely impacted by a major service change or fare change is fifteen percent (15%) higher than the average low-income population of the Big Blue Bus service area, or when the percentage non- low-income population beneficially impacted by a major service change or fare change is fifteen percent (15%) higher than the average non-low-income population of the Big Blue Bus service area.” (BBB Title VI Standards and Policies, Pg. 9) Fare Equity Analysis The revised fare structure represents an improvement and will benefit BBB riders that currently use or elect to switch to the TAP stored value fare. As such, the following analyses must determine whether the minority or low-income populations will be unfairly impacted by this improvement. Disparate Impact Analysis There were 3,258 respondents that completed the race/ethnicity question. Of these total responses, 75% of riders were identified as minority riders (riders that selected a race other than white-alone). The survey results indicate that three out of every four riders is a minority rider. Figure 4: Systemwide Ridership by Race Disparate Impact Findings  Minority riders comprise 75% of systemwide riders 75% 25% 0%10%20%30%40%50%60%70%80% Minority White (Non-Hispanic) Percent of Riders Ra c e Systemwide Race/Ethnicity -2016 Survey  Cash is the most popular fare choice amongst minority (57%) and non-minority (53%) riders  Minority riders are 4% more likely to use cash compared with non-minority riders (57% vs 53%)  Minority riders are 1% less likely to use TAP compared with non-minority riders (10% vs 11%)  Minority cash fare utilization is 2% higher than the systemwide percent of minority riders (77% vs 75%) Figure 5: Fare Utilization Comparison by Race Figure 6: Fare Breakdown by Race Based on the 15% threshold, established in the Disparate Impact Policy, minority riders would not experience a disparate impact as a result of the revised fare structure. Minority riders are 4% 57% 12% 10% 8% 5% 4% 3% 1% 1% 53% 7% 11% 10% 10% 5% 1% 2% 1% 0%10%20%30%40%50%60% Cash SMC TAP BBB-Pass UCLA Flash Pass Access Pass Transfer (interagency) BBB-Token Other Percent of Riders Fa r e Fare Utilization Comparison -2016 Survey Non-Minority Minority 90% 85% 81% 77% 72% 70% 69% 67% 59% 10% 15% 19% 23% 28% 30% 31% 33% 41% 0%20%40%60%80%100% Transfer (interagency) SMC Other Cash TAP BBB-Pass Access Pass BBB-Token UCLA Flash Pass Percent of Riders Fa r e Fare Breakdown by Race -2016 Survey Minority Non-Minority more likely to use cash and 1% less likely to use TAP compared with non-minority riders. The proposed TAP stored value fare is anticipated to benefit both minority and non-minority riders to a similar degree. Disproportionate Burden Analysis There were 1,874 respondents that completed the household income question. Of these total responses, 71% were identified as low-income riders (riders that earned less than $34,999 in total household income). The survey results indicate that five out of every seven riders is a low-income rider. Figure 7: Systemwide Ridership by Income Disproportionate Burden Findings  Low-income riders comprise 71% of systemwide riders  Cash is the most popular fare choice amongst low-income (59%) and non-low-income (50%) riders  Low-income riders are 9% more likely to use cash compared with non-low-income riders (59% vs 50%)  Low-income riders are 6% less likely to use TAP compared with non-low-income riders (9% vs 15%)  Low-income cash fare utilization is 3% higher than the systemwide percent of low-income riders (74% vs 71%)  Low-income TAP utilization is 13% lower than the systemwide percent of low-income riders (58% vs 71%) 40% 31% 14% 7% 5% 4% 0%5%10%15%20%25%30%35%40%45% Less than $20,000 $20,000-$34,999 $35,000-$49,999 $50,000-$74,999 $75,000-$99,999 $100,000 or More Percent of Riders Ho u s e h o l d I n c o m e Systemwide Income -2016 Survey Low-Income Figure 8: Fare Utilization Comparison by Income Figure 9: Fare Breakdown by Income Based on the 15% threshold, set in the Disproportionate Burden Policy, low-income riders would not experience a disproportionate burden as a result of the revised fare structure. Low-income riders are 9% more likely to use cash and 6% less likely to use TAP compared with non-low- income riders. The proposed TAP stored value fare is anticipated to benefit non-low-income riders to a greater degree than low-income riders due to the greater utilization of TAP by non-low- income riders. Additional analysis of the low-income population is included in the “Further Actions” section below. 59% 11% 9% 6% 6% 5% 2% 1% 0% 50% 8% 15% 11% 10% 3% 2% 1% 1% 0%20%40%60%80% Cash SMC TAP UCLA Flash Pass BBB-Pass Access Pass Transfer (interagency) BBB-Token Other Percent of Riders Fa r e Fare Utilization Comparison -2016 Survey Non-Low-Income Low-Income 81% 78% 76% 74% 68% 60% 58% 58% 50% 19% 22% 24% 26% 32% 40% 42% 42% 50% 0%20%40%60%80%100% Access Pass SMC Transfer (interagency) Cash BBB-Token BBB-Pass UCLA Flash Pass TAP Other Percent of Riders Fa r e Fare Breakdown by Income -2016 Survey Low-Income Non-Low-Income Further Actions Since there is less TAP utilization among low-income riders, there will be a smaller percentage of low-income riders that benefit from the fare change as compared with non-low-income riders. Actions to avoid, minimize, or mitigate the proposed changes are not required as the proposed change does not result in a disproportionate burden. However, further discussion of the low- income population can shed some light on BBB’s current practices to make transit service affordable and accessible. Out of the total number of low-income riders, 59% pay their fare with on-board cash and 79% have a mobile phone with a data plan. Customers with a data plan can access the internet to purchase a TAP smartcard and can also reload their existing smartcard via https://www.taptogo.net/. The TAP stored value fare will also be available on BBB’s mobile fare payment application and is available at all Metro ticket vending machines. BBB is continuing to work closely with Metro to expand the availability of TAP retail outlets throughout the service area. BBB is also an ongoing participant in Metro’s Rider Relief program, which provides qualifying riders with a $10 subsidy per month for the purchase of a weekly or monthly pass. This fare program substantially reduces the cost per ride for low-income riders and can offset their transportation expenses. Figure 10: Mobile Phone Ownership by Income Conclusion Title VI of the Civil Rights Act of 1964 prohibits discrimination on the basis of race, color, or national origin in any program or activity that receives Federal funds or other Federal financial assistance. In compliance with this law, Big Blue Bus has conducted a Title VI analysis on the proposed fare change. This analysis has found that the revised fare structure does not result in 2% 18% 79% 2% 14% 84% 0%20%40%60%80%100% I don't have a phone No Yes Does your mobile phone have a data plan to surf the Internet? Non-Low-Income Low-Income an adverse disparate impact on the minority population or an adverse disproportionate burden on the low-income population. The proposed reduction in the TAP stored value smartcard fare is expected to benefit existing and future customers using prepaid TAP fares and will benefit all customers through reduced dwell times, improved reliability, and better on-time performance throughout the BBB system. Appendix Big Blue Bus – SURVEY FINAL 2. FARE PAYMENT How did you pay for your fare today? Cash Big Blue Bus – Paper Pass TAP – Stored Value SMC (Santa Monica College - ID) UCLA Flash Pass Other 40. HOUSEHOLD INCOME What is your cumulative Household Income (Total of all people earning money in the house)? Less than $20,000 $20,000-$34,999 $35,000-$49,999 $50,000-$74,999 $75,000-$99,999 $100,000-or more Decline 41. RACE/ETHNICITY Select the group(s) that best describe(s) you. (Select All that Apply) White Black Hispanic/Latino Asian/Pacific Islander Native American Other Blue to Business Pricing Minimum Percent of Total Employees Supplied Passes Cost per Annual Pass 15%$175* 30%$105* 50%$70* 75%$50* 100%$42* * Employers must purchase a minimum of 30 annual unlimited ride passes and adhere to the percentages of employees stated above to obtain this discounted pricing. These annual passes are supplied on personalized rechargeable TAP cards at an additional cost of $5 each. Personalized TAP cards can be easily cancelled and replaced if lost or stolen. Fare Adjustment Public Hearing – Summary of Feedback Big Blue Bus (BBB), in accordance with Federal Transportation Administration Circular 9030.1D, held a public hearing on the proposed fare restructure on August 1, 2017 from 6pm to 7:30 pm at the Santa Monica Main Library. BBB staff communicated the details of the hearing and invitation for public participation via the following: • BBB website feature and detailed webpage • Transit Mall digital kiosk ad • Transit Store ad • Transit Store take-one brochure • Bilingual onboard flyer • Bilingual onboard take-one brochure • BBB email alerts (three) • Social media posts on BBB FB, Twitter, and Instagram • Santa Monica Daily Press newspaper ad notices (two dates) • Media advisory • City of Santa Monica website feature • City of Santa Monica social media posts Eighteen members of the public signed-in and approximately seven additional individuals joined without signing in after the hearing started, for a total of approximately 25 attendees. In addition, BBB had nine staff members present. Transit Director, Ed King, presented the proposed fare restructure and conducted a question and answer session at the end of his presentation. The following is a summary of the feedback from members of the public. 1) A total of 18 stakeholders made verbal comments at the public hearing. Fewer than half of the comments related to the proposed fare adjustment. Recurring themes included, the suggestion to reinstate BBB to BBB transfers, disapproval of the elimination of a BBB token option, and increased TAP vendor locations/convenience. 2) Five comments were received on paper at the hearing. Two of these comments were unrelated to the fare proposal. All of these reflected the sentiments from the verbal comments received and were centered around improvements to the TAP system and the reinstatement of BBB to BBB transfers. 3) Nine comments were received via the GO system. Seven of the nine comments were related to the proposed fare adjustment. Recurring themes included, the suggestion to reinstate BBB to BBB transfers, the ability to exchange BBB tokens for 1-Ride passes, the high cost of the annual pass, and the ability to pay the Rapid 10 upgrade fee using TAP. Feedback Received via GO Name Comment 1. Allon Percus Bring back BBB to BBB transfers instead of lowering the single ride fare. Believes free transfers encourages customers to ride more as he does now on Metro’s Expo Line. 2. Mark Bartelt Implement a token exchange for 1-Ride passes. 3. Hector Ramirez Does the single ride fare discount apply to Token Transit? 4. Anne Brown Believes the cost of the annual pass is prohibitive to low-income customers. Suggests BBB provide the option for customers to pay in installments. Or, implement a monthly cap on per-person fares at the cost of a monthly pass. 5. Anonymous - BBB rider for over 30 years The annual pass does not make sense for Seniors. 6. Stephen Ma Paying the Rapid 10 upgrade fee in cash is inconvenient because it requires coins. BBB should look into providing IATs using a TAP card. 7. Peter Altschuler Does not believe the 15¢ discount is incentive enough for customers to go on TAP because acquiring a TAP card is inconvenient and we require customers to pay a full fare when transferring from one BBB to another BBB. 8. Tim Colvin Would like to exchange the bus tokens for TAP enabled 1-Ride passes. 9. Virginia Halstensgard Believes the annual pass is designed for high-income earners or employers and is not within reach of regular customers. Additionally, she believes the $100 savings is being subsidized by regular customers. Written Feedback Received at Public Hearing Name Comment 1. Anonymous Improve TAP system to make it more efficient, and requests more TAP workshops for S/D/M riders. 2. Jan-Michael Medina Inconvenience of limited availability of locations to purchase single-fare or TAP cards, discouraging for non-regular users. Mobile passes are great, but not for those who don’t have credit cards. Need more creative ways to get TAP cards in hands of residents. 3. Barbara Whitney Would like free BBB transfers. Paying two fares is a huge disincentive. Verbal Feedback Received at Public Hearing Name Comment 1. Stakeholder Dislikes the proposal to eliminate BBB tokens and to replace them with single- use TAP cards, especially paper cards that cannot be reused. Thinks BBB should come up with a better alternative. Also, stakeholder believes that the TAP application process is not fast enough and BBB should have the ability to process and issue TAP card with photos immediately. 2. Stakeholder Instead of eliminating BBB tokens all together, why doesn’t BBB go back to using Metro tokens. You are getting rid of something that the most vulnerable customers use. 3. Stakeholder Concerned about the number of places to get a TAP card is limited. Compounded by the limited Transit Store hours, specifically not having weekend hours, makes it difficult for people in Santa Monica to get a card. 4. Stakeholder Inquired about trading in tokens for 1-Ride passes. Written Feedback Received via GO Allon Percus Synopsis: Bring back BBB to BBB transfers instead of lowering the single ride fare. Believes free transfers encourages customers to ride more as he does now on Metro’s Expo Line. I think it is a really bad idea to lower the one-way trip fare for TAP customers. The fare is already quite low. What would be SO MUCH BETTER is allowing free transfers for TAP customers. Charging extra money for a transfer is utterly absurd from the customer's perspective. Transfers are an imposed inconvenience. In what other 5. Stakeholder Inquired about the ability to purchase an interagency transfer using a TAP card versus cash. Additionally, wanted to know why BBB eliminated BBB to BBB transfers. 6. Barbara Whitney – Crossroads School It is a huge disincentive not to have a BBB to BBB free transfer option both for employers and Santa Monica residents. 7. Stakeholder BBB thinks of itself as a regional system, but BBB is also here to serve the community. BBB is also running a community short hop service and people want to make quick connections from one bus line within SM to another. Customer thinks it’s absolutely essential to bring those transfers back as convenience for BBB customers and perspective customers. 8. Stakeholder Inquired about any accommodation for anyone who invests in an annual pass and then, for whatever reason, isn’t able to use the pass. Can they be refunded for any unused months? 9. Stakeholder Integrate Blue at Night with TAP card for more convenient payments. 10. Stakeholder Provide City of Santa Monica students free bus passes while the law is that students up to age 16 must attend school. business could one ever get away with charging more money for an inconvenient product than for a convenient one??? This makes no sense at all, and it would be far better to RAISE the base fare so that it covers enough of your costs that you can allow free transfers within (say) 2 hours, as Metro does. The fact that I can now transfer for free from the Metro expo line to the red or purple lines downtown is really helpful, and is an encouragement for me to use their service. The fact that Big Blue Bus charges extra for the bus ride to the expo line discourages me from using your service: I have taken over 100 expo line trips in the past year, and only twice have I taken the bus between my home and the 26th/Bergamot station. Mark Bartelt Synopsis: Implement a token exchange for 1-Ride passes. Hello, BBB ... One of the items mentioned is "discontinuation of single-use tokens and introduction of a new 1-Ride Pass that is TAP enabled as its replacement". I have no problem with that, but I'm hopeful that those of us who have tokens will be able to exchange them for single-ride TAP passes. The reason is that I have quite a few tokens which certainly won't get used before these adjustments take place, because I'm old enough to use the senior fare. But I keep a supply of tokens on hand for out-of-town visitors to use when they're here. I hope I won't be left with a bunch of tokens that I paid money for, but which will become worthless. Please implement an "exchange tokens for single-ride TAP passes" policy. Thanks! Hector Ramirez Synopsis: Does the single ride fare discount apply to Token Transit? Dear Friends, I may not be able to attend the August 1st meeting regarding the BBB fare adjustments, however, I wish to contribute some input. I assume that the TAP discount being suggested also applies to users of the Token Tap smartphone application. Thank you for your consideration and I look forward to the meeting, if possible. HR Anne Brown Synopsis: Believes the cost of the annual pass is prohibitive to low-income customers. Suggests BBB provide the option for customers to pay in installments. Or, implement a monthly cap on per-person fares at the cost of a monthly pass. I urge the Big Blue Bus to adjust the currently monthly and proposed annual pass in one of two ways to make the passes more accessible to lower-income riders, for whom passes' up-front costs often prove too high, but who would greatly benefit from the lower marginal trip cost often afforded to pass holders. First, to allow riders purchase the new proposed annual pass in payment installments; annual passes often allow for the lowest per-ride cost to riders, but at the same time, the high up front costs make them financially out of reach to many lower-income riders, who would most benefit from an annual pass. Research repeatedly finds that lower- income adults have difficulty paying for passes due to these up-front costs. For example, a report by the Mineta Institute suggests to "Divide large, lump-sum transportation costs such as transit passes into smaller, more frequent payments, to make the costs more manageable." (see full report here: http://transweb.sjsu.edu/MTIportal/research/publications/documents/2806_10-02.pdf) Alternatively, other cities place a monthly cap on per-person fares at the cost of a monthly pass. The same could be done for Big Blue Bus' current monthly or proposed annual pass. A cap extends the benefits of holding a pass (lower marginal trip costs when amortized across a month's worth of trips) to those who cannot afford the up-front costs of passes. Anonymous - BBB rider for over 30 years Synopsis: The annual pass does not make sense for Seniors. Do you realize that your $500 annual pass is $20 MORE than a year's worth of $40 Senior TAP Monthly pass???? And, since with an annual pass BBB has the use of our funds without paying for it, the $40/monthly pass should be discounted if you purchase a $480 yearly pass. Stephen Ma Synopsis: Paying the Rapid 10 upgrade fee in cash is inconvenient because it requires coins. BBB should look into providing IATs using a TAP card. Passengers will be required to bring $1.40 cash, which means at least 3 coins and a 1 dollar bill, for R10 assuming the fare of R10 remains the same and the base fare for TAP becomes $1.10. It is going to be inconvenient. Also, Big Blue Bus should investigate ways to load interagency transfers directly to the TAP card. Peter Altschuler Synopsis: Does not believe the 15¢ discount is incentive enough for customers to go on TAP because acquiring a TAP card is inconvenient and we require customers to pay a full fare when transferring from one BBB to another BBB. Subject: The proposed fare adjustments are... … designed far more for BBB than they are for transit riders. They may simplify cash handling for BBB, but they don’t simplify the acquisition of a TAP card by riders. While the cost of a fare will fall —if riders use a TAP card — the 15¢ differential won’t provide an incentive for anyone to go out of their way to buy a card. What won’t be falling is the cost of a trip that now requires multiple lines. The #3 route, which used to travel from LAX all the way to UCLA, now ends at the odd location of Arizona and 5th. To get to UCLA, riders now have to change busses… and pay a separate full fare because transfers are no longer provided. If that’s a planner’s idea of how to boost revenue, I’d review that person’s credentials. Given the overlap among BBB and Metro routes, it makes far more sense to plan a trip on Metro, which does provide transfers, than to pay multiple full fares on BBB. I’ve lived in Santa Monica for 38 years, and I’ve yet to grasp the logic of its bus route modifications. Rather than make it easier to use the Big Blue Bus, it remains a challenge to get from point A to point B. The best example is Santa Monica’s main N/S commercial street, Lincoln Boulevard. It’s a transit dead zone from Pico to Wilshire with no options for stops at Olympic, Colorado, Broadway, or Arizona. The best one can hope for is a transfer at 4th Street and Santa Monica, and that gets you only to Lincoln and Santa Monica Boulevards or Lincoln and Wilshire. The businesses (and their customers) between Pico and Santa Monica Boulevards have no public transit to rely on at all. Ironically, the original garage for Santa Monica’s busses was between Olympic and Colorado— before it was Hill & Vaughan or the antiques mall. Now that’s gone, too, thanks to the myth of the Expo Line’s “benefits.” So, no, I won’t be switching to more public transit. The cost and inconvenience are too great. p Tim Colvin Synopsis: Would like to exchange the bus tokens for TAP enabled 1-Ride passes. I have a few hundred bus tokens. I called the BBB yesterday, and I was told that I cannot exchange them for a tap card, or anything else. This seems terribly wrong to me. I am simply looking for a fair exchange, before the tokens are phased out. What can be done about this? Virginia Halstensgard Synopsis: Believes the annual pass is designed for high-income earners or employers and is not within reach of regular customers. Additionally, she believes the $100 savings is being subsidized by regular customers. I am extremely opposed to the "An introduction of a new Annual Pass for a sale price of $500, a $100 savings." This savings will mean that the typical rider, who probably does not have a great salaried job to help pay the $500 fare, will have to subsidize this $100 break that the wealthier employee with a great job will get. This is wrong! The riders who do not have the bigger funds to purchase the $500 Annual Pass should absolutely not be paying the full price and forced to subsidize this better off company or employee who can afford the much higher ticket. It is high time the guys with all the money pay their fair share and for government to stop subsidizing the rich! Written Feedback at Public Hearing Anonymous Synopsis: Improve TAP system to make it more efficient, and requests more TAP workshops for S/D/M riders Lobby Metro to upgrade TAP system, providing complete TAP card service for Seniors, Disabled, Medicare, giving photo TAP cards instantly, instead of waiting, or available only once a month. Jan-Michael Medina Synopsis: Limited availability of locations to purchase single-fare or TAP cards is inconvenient and discouraging for non-regular transit riders. Mobile passes are a great idea, but does not factor in those who don’t have access to credit cards. Need creative ideas to put TAP cards in hands of residents. 1. The availability of places to purchase a single fare or TAP card is inconvenient. While I understand you can purchase at certain stores, I am not going to travel out of my way for a one-way fare. As a regular bus-rider, I typically have money stored on my TAP card, but for non-regular users, they will be discouraged from taking the bus or they are the individuals using cash and holding up the bus (from my experience). 2. Mobile passes are a good step forward, but there are still limitations. I can’t purchase multiple tickets (if I had children traveling with me), and not everyone has access to a credit card. 3. Think creatively to expand ability to put TAP cards in the hands of residents and their ability to refill. 4. Convenience is everything. Barbara Whitney Synopsis: Would like free BBB transfers reinstated, 2 fares is a huge disincentive. I came to make a pitch for re-instating transfers (free!). It is a big disincentive to have to pay 2 fares for a short trip. In my case, I can drive from home at Main/Hollister to work at 20th/Olympic in 7 minutes. Or I can take 2 routes (#8 & #16) to get to work conveniently, but it’s a minimum of 30 minutes. In choosing between a 7 min. drive and a car-free, longer commute of 30 min., the requirement to pay 2 fares kicks me over the edge and back to the car. I also supervise an active, successful TDM program at Crossroads School and am trying to encourage BBB use, but the transfer issue really gets in the way. Please keep your eyes on the big picture * use the advantage of transfers for a single trip! & otherwise, line 16 is great! Verbal Feedback at Public Hearing See transcript. I t e m 3 - B 1 0 / 1 0 / 1 7 1 o f 3 I t e m 3 - B 1 0 / 1 0 / 1 7 It e m 3- B 10 / 1 0 / 1 7 2 of 3 It e m 3- B 10 / 1 0 / 1 7 1 Vernice Hankins From:Ed King Sent:Thursday, October 05, 2017 5:16 PM To:Stephanie Venegas; Ted Winterer; Gleam Davis; Pam OConnor; Sue Himmelrich; Terry O’Day; Councilmember Kevin McKeown; Tony Vazquez Cc:councilmtgitems; Anuj Gupta; Rick Cole Subject:RE: Letter from Disability Commission: 10/10 Agenda Item 3B Mayor and Councilmembers:  Pursuant to the feedback that we received Monday evening from the Disabilities Commission, we have modified our  original recommendation and will not charge a fare to PCAs who accompany an Access Services Member on a BBB trip.  Please contact me should you have any questions after perusing the staff report.  Thank you.  Ed  From: Stephanie Venegas   Sent: Thursday, October 05, 2017 5:07 PM  To: Ted Winterer <Ted.Winterer@SMGOV.NET>; Gleam Davis <Gleam.Davis@SMGOV.NET>; Pam OConnor  <Pam.OConnor@SMGOV.NET>; Sue Himmelrich <Sue.Himmelrich@SMGOV.NET>; Terry O’Day  <Terry.Oday@smgov.net>; Councilmember Kevin McKeown <Kevin.McKeown@SMGOV.NET>; Tony Vazquez  <Tony.Vazquez@SMGOV.NET>  Cc: councilmtgitems <councilmtgitems@SMGOV.NET>; Ed King <Ed.King@SMGOV.NET>; Anuj Gupta  <Anuj.Gupta@SMGOV.NET>  Subject: FW: Letter from Disability Commission: 10/10 Agenda Item 3B  Council‐  Please see the attached letter from the Disabilities Commission: Item 3B ‐ Big Blue Bus Fare Restructure  Thanks,  Stephanie  Item 3-B 10/10/17 3 of 3 Item 3-B 10/10/17