What Transportation Budget Cuts Could Mean to You

by Joan Lockwood-Reck, Marketing Service Development Manager for Greater Mercer TMA

The recently announced budget reductions for the state run public transportation system, NJ TRANSIT, may result in all of us paying a higher price. The proposed 30% fare increase on the Mercer area network of bus routes and rail service could have long term effects on a system that is targeted for growth. Fare increases typically impact ridership - sometimes temporarily, sometimes forever.

If the bus fare is raised by 30%, the one-way fare for a one zone bus ride would increase from $1.35 to $1.76. In Mercer County, the average median weekday one way trip for all NJT routes was 16,058 ( NJT April/May 2009). If all bus trips made were a one zone ride the revenue generated would be $28,181.79/day, assuming there is no loss of ridership. Typically with any fare increase there is a loss of ridership.

The frequently-used rule of thumb, known as the Simpson-Curtin rule, is that for every 3% fare increase, there will be a 1 % decline in ridership. Like most rules-of-thumb, this can be useful for a rough analysis, but other factors must be weighed to predict impact. If we apply the general rule-of thumb, this would mean that 1,606 passenger trips per day on the Mercer bus system would be lost. The amount of additional revenue generated after the fare increase would be $3,685.31. But the costs are really much higher.

“Choice riders,” those that have commute options, will explore alternatives modes, if they feel the value of transit has been diminished. This will result in more cars on the road, which means more congestion and more pollution.

The cost is even higher for those who do not have alternate modes of transportation for whom transportation will consume an even larger portion of their household income. Add on service cuts to fare increases, and these effects are more severe.

The next few months could be interesting – stay tuned.