Report to/Rapport au :

 

Transit Commission

Commission du transport en commun

 

and Council / et au Conseil

 

April 11, 2012

11 avril 2012

 

Submitted by/Soumis par : Steve Kanellakos, Deputy City Manager/Directeur municipale adjointe, City Operations/Opérations municipales

 

Contact Person / Personne ressource:  John Manconi, General Manager/Directeur général, Transit Services/Services du transport en commun

613-842-3636 x2111, John.Manconi@ottawa.ca

 

 

CITY WIDE / À L’ÉCHELLE DE LA VILLE

Ref N°: ACS2012-COS-TRA-0003

 

 

SUBJECT:

 

OC Transpo fares -  2012/2013

 

OBJET :

 

TARIFS D’OC Transpo — 2012/2013

 

 

REPORT RECOMMENDATIONS:

That the Transit Commission recommend that Council approve:

 

1.    The adoption of the fares outlined in Document 1 of this report, to come into effect on July 1, 2012;

2.    The application of Express fares to the current Rural Express routes, as described in this report; and,

3.    The termination of the ECOPASS program, as described in this report.

 

 

RecommandationS du rapport

 

Que la Commission du transport en commun recommande au Conseil d’approuver :

 

1.     L’adoption des tarifs indiqués dans le document 1 du présent rapport, qui doivent entrer en vigueur le 1er juillet 2012;

2.     L’application des tarifs Express aux actuels circuits Rural Express, comme le précise le présent rapport;

3.      L’élimination du programme ECOPASS, comme le précise le présent rapport.

 

 

Background

 

As part of the Council approved 2012 Budget, transit fares could rise an overall average of 2.5 percent, effective July 1, 2012. With this increase, and with anticipated ridership levels, fare revenue in 2012 is expected to meet the budgeted amount of $174.25 million.

 

Also, as part of the 2012 Budget, Council approved that the U-Pass fare for eligible undergraduate and graduate university students from Carleton University and the University of Ottawa be set at $180.00 per semester, for the 2012-13 academic year.  Additionally, the fare for rural-urban Para Transpo trips would be set at a flat rate of $8.25 per trip. Council also approved that Annual Passes and Semester Passes would no longer be available in 2012.

 

This report recommends the detailed allocation of fare changes to achieve the overall 2.5 percent increase. This report also recommends elements of the fare structure to take advantage of the PRESTO smart card technology, which will be introduced this year.

 

The report uses a number of terms that are associated with the upcoming PRESTO system.  The following list of items and explanations are to help clarify the contents of this report.

Smart Card – the PRESTO smart card is an electronic fare payment system that provides customers with the ease and convenience of uploading cash onto the card, to either pay via e-Purse or monthly pass.  When the customer “taps” on a fare payment device, the system instantly calculates and deducts the correct fare.

e-Purse - short for Electronic Purse. It is where the customer stores cash value that, with a tap of the smart card, can be used to pay a fare, purchase a day pass, or pay for a companion.

 

Pay-per-ride – one fare purchase equals one ride - when a customer uses the e-Purse, cash or tickets to purchase a fare. 

 

Auto-renew – the ability of a customer using a PRESTO card to renew a monthly pass through automatic debit or credit card payment.

 

Transferable Pass – a feature of the PRESTO card that allows a person to share their card with another person when they are not using it; the person is in the same class; or it is used for e-Purse.

 

Card Reader – this is a device located on the bus.  The customer taps the PRESTO card across the reader for the fare to be acknowledged and accounted for.     

 

DISCUSSION

 

Document 1 of the report lists the recommended fares for 2012-13. These fares will come into effect July 1, 2012. Document 2 of this report is a comparison of the recommended 2012-13 fares with the current 2011-12 fares.

 

The recommended fares for 2012-13 include:

·         An overall average 2.5 percent fare increase;

·         Total fare revenue, as budgeted, of $174.25 million;

·         New pay-per-ride fare rates for payment via the e-Purse function of the PRESTO smart card system;

·         New discounted pay-per-ride fares for seniors;

·         The application of Express fares on the current Rural Express routes, to reduce fares for rural customers and to remove operational difficulties;

·         The end of the current pilot project of free service for seniors on Mondays and Fridays after noon (the current free service on Wednesdays will continue); and

·         The termination of the ECOPASS program as we move to implementing the PRESTO smart card program.

 

Fare changes for seniors

 

The recommended fares bring in new discounted pay-per-ride fares for seniors, set at $2.00 per ride when using the e-Purse feature of the PRESTO smart card and at $2.50 per ride when paid by cash. Currently, discounted fares for seniors are only available with the purchase of a monthly pass.

 

Free service for seniors has been available on summer Wednesdays since 2007, on Wednesdays year-round since 2009, and also on Monday and Friday afternoons since April 2011. It is recommended that the free service on Mondays and Fridays be removed, and the value of that discount be transferred to create the new discounted single-ride fares. This change will also reduce the variation in fares by day of the week, which has led to confusion between customers and operators.

 

The effect of these changes is to widen the availability of discounted transit service to be more equitably available to seniors at more times of the week.

 

Fare changes on Rural Express routes

 

Rural Express Routes 221, 231, 232, 245, and 283 primarily serve the rural villages of Cumberland, Sarsfield, Navan, Vars, Carlsbad Springs, Manotick, Munster Hamlet, and Richmond. Fares on these routes are currently higher than Express routes, at $145 for a monthly pass, $5.20 when paid with tickets, and $5.25 cash. It is recommended that the fare on these routes be reduced, to be the same as on Express routes. (Along with this change, Route 245 would be designated as part of Route 99 and would operate at regular fare.)

 

This change is expected to increase ridership on the rural express routes, and the new ridership will bring in some new fare revenue. There is currently capacity available to accommodate growth on many Rural Express trips with no added operating costs. While each individual customer would pay less, the change is expected to increase ridership, which would bring in new revenue. Any change in total fare revenue would affect the property taxes collected in Rural Transit Area A in 2013, and would be included in the 2013 Budget.

 

Currently, some customers use Rural Express routes for trips that are entirely within the Urban Transit Area at Express fares, and it has proven difficult for operators to ensure that all customers have paid the correct fare for their trips. Setting the fares at the Express level will eliminate this operational problem.

 

Termination of the ECOPASS program

 

The introduction of PRESTO will allow former ECOPASS holders to customize their travel experience while providing the convenience and flexibility to purchase as many months of transit service as they need.   As a result, it is recommended that the ECOPASS Program be eliminated during the fall of 2012.

 

Further, OC Transpo is no longer able to sustain annual fares that are deeply discounted below operating costs.

 

In 2011-12, an ECOPASS subscription costs $990 per year, and with the 2.5 percent increase applied, it would cost $1,014 in 2012-13. By choosing to purchase 10 monthly passes and 10 days of pay-per-ride e-Purse fares, a typical current ECOPASS subscriber would pay $1,015 per year in 2012-13.

 

The cost of an ECOPASS will increase to the cost of an Adult Regular or Express monthly pass as of July 1, depending on what the customer has chosen.  ECOPASS subscribers will have the option to withdraw from the ECOPASS program by notifying their employer and taking advantage of paying less for their reduced transit needs during the summer. Although ECOPASS holders can continue with payroll deductions until the fall, they also will have the option to transition to PRESTO when they choose.  Each employer will be provided with proper termination notices in accordance with the terms of each employer’s respective ECOPASS contract.

 

ECOPASS holders, once they convert to PRESTO, will be able to take advantage of the new transferable bus pass.  This provides the benefit of allowing customers to transfer their bus pass within the same class. 

 

Staff will provide notification of the fare change to employers of ECOPASS subscribers and will  work with them to issue new PRESTO smart cards through the fall of 2012 to provide a seamless transition.

 

 

Other fare matters related to the introduction of PRESTO smart cards

 

The new PRESTO smart card system allows for customers to either pay per month for their fares, by purchasing a monthly pass and loading it on the card, or to pay per ride, by loading a cash value onto the e-Purse feature of the card. The card readers on  buses will verify the validity of monthly passes or will deduct the appropriate fare from the e-Purse balance on the card.

 

With the new PRESTO system, it will be possible, later this summer, for customers starting their trips at O-Train stations to pay for their ride using the e-Purse feature. The ticket vending machines will (in future) only be required for customers paying in cash, and they will be calibrated to accept the full cash fare rather than the current special O-Train single-ride fare. This change has no effect on the majority of O-Train customers, as most customers use a monthly pass, a U-Pass, or pay their fare on a bus route and transfer to the O-Train.

 

As it is impractical to install PRESTO card readers on taxis used in Para Transpo service, Para Transpo customers will continue to use photo identification cards and paper monthly passes. OC Transpo staff are developing a new fare system for Para Transpo service that will provide additional convenience and flexibility to Para customers.  

 

Along with the introduction of the PRESTO system, the defined age groups of customers will be adjusted to be consistent with those of other transit systems using the PRESTO system across the Province. These are: free fare (0 to 5 years); child (6 to 12 years); student (13 to 19 years); adult (20 to 64 years); and, seniors (65+ years).  Eligible fulltime university students from Carleton University and University of Ottawa who are 20 years or older will use their U-Pass from September to April, but will need to pay adult fares during the summer.

 

By the end of the year, with upgrades to the back-office system, OC Transpo’s PRESTO cards will be interchangeable with nine other transit systems in the Toronto / Hamilton area. This will allow PRESTO card holders the convenience of using their cards while travelling, and will ensure that students and seniors can continue to receive their discounts when they travel.

 

The use of paper tickets will be closely monitored as customers transition to PRESTO cards. A decision will be made toward the end of the year whether to continue the sale of paper tickets.

 

 

RURAL IMPLICATIONS

 

The recommendations in this report would reduce the fares charged on the current Rural Express routes. While each individual customer would pay less, the change is expected to increase ridership, which would create new revenue. Any change in total fare revenue would affect the property taxes collected in Rural Transit Area A in 2013, and would be reported as part of the 2013 budget.

 

CONSULTATION

In preparing this report, staff have had the advantage of submissions made by transit customers and City advisory committees. In addition, staff have had direct discussions with representatives of the Seniors Advisory Committee, Algonquin College, la Cité collégiale, and CEPEO (Conseil des écoles publiques de l'Est de l'Ontario).

 

 

LEGAL IMPLICATIONS

There are no legal impediments to implementing the recommendations outlined in this report.  Legal Services will work with staff to implement the necessary changes required to the Transit Services By-law 2007-268.

 

 

RISK MANAGEMENT IMPLICATIONS

Risk management implications are highlighted throughout this report, including financial information regarding the implementation of the 2012-13 Fare Table detailed in the Financial Implications section below.    

 

 

FINANCIAL IMPLICATIONS

The fare rates as proposed in this report achieve an average 2.5% increase, which is consistent with the fare assumptions established in the 2012 Transit Budget approved by Council on November 30, 2011.  Based on these rates, and on ridership projections, the fare revenues will meet the established 2012 Budget of $174.25 million.   Transit will also meet the 2012 budgeted revenue/cost ratio, which is the share of operating costs to be borne by transit riders, of 53.3%.  The City’s fiscal framework has established a goal of 55% for the Transit revenue/cost ratio.  Certain risks, however, if fully realized may alter the above projection.

 

With the discontinuance of the ECOPASS program current ECOPASS customers will give consideration to their options. 

 

Generally, transit riders will benefit from the more economical Monthly Pass product.  In some instances, such as during a vacation period, a pass holder may elect to use the pay-per-ride option.  This could potentially reduce the amount of revenue collected from an individual by $10 - $30 in such a month.  These are decisions based on personal circumstances, which cannot easily be estimated, particularly during an implementation period.

  

A new feature of the PRESTO card is that it is transferable between users within the same class only; however, cards within a discount category (i.e. seniors or students) cannot be used by a person not qualifying for a discount.  As e-Purse cardholders must pay for each ride taken, the risk of reduced revenue is limited to monthly pass holders who could potentially share their card when not on their person.  

 

The PRESTO card also offers improvements in revenue controls as the software will limit the potential for fare evasion, invalid transfers, tickets, and passes, etc.   An initial assessment found that these improved controls would largely offset any potential loss from transferability. 

 

 

ACCESSIBILITY IMPACTS

The recommended fare changes for seniors will widen the availability of discounted transit service to be more equitably available to seniors at more times of the week. There are no effects from these recommendations on transit service for customers with disabilities.

 

 

Technology Implications

There are no IT implications for this fare change.

 

 

TERm of council priorities

The recommendations outlined in this report support Council’s priority of offering reliable travel options at the lowest possible cost and in a financially and operationally sustainable way.

 

 

SUPPORTING DOCUMENTATION

Document 1 – Recommended Fares, effective July 1, 2012, immediately follows the report.

Document 2 – Comparison with previous year, immediately follows the report.

 

 

DISPOSITION

Upon approval of this report by Transit Commission, staff will forward the OC Transpo Fares 2012-13 report, including Document 1 and 2, to Council on April 25, 2012.

 

This timeframe is required to provide Legal Services appropriate opportunity to incorporate the necessary changes into the Transit Services By-law 2007-268 before the July 1, 2012, deadline.  

 

OC Transpo staff will advise customers of the fare changes and will take the technical and logistical steps to implement them.

 

 

                                                                                                                                      Document 1

 

Recommended Fares, effective July 1, 2012

 

Pay-per-month fares (passes)

 

Fare Category

Service Type

Amount ($)

Adult

Regular

96.25

Adult

Express

119.00

Student

Regular

76.75

Student

Express

90.25

Senior

All

39.00

Community

All

32.00

 

Pay-per-ride fares

 

Fare Category

Service Type

Payment Method

Amount ($)

Adult/Student

Regular

e-Purse

2.65

Adult/Student/Senior

Regular

Ticket

  3.00(1)

Adult/Student

Regular

Cash

3.30

Adult/Student/Senior

Express

e-Purse

4.00

Adult/Student/Senior

Express

Ticket

  4.50(1)

Adult/Student/Senior

Express

Cash

4.65

Senior

Regular

e-Purse

2.00

Senior

Regular

Cash

2.50

Child

All

e-Purse

1.50

Child

All

Ticket

1.50

Child

All

Cash

1.75

All

Para Transpo Rural

Cash/Ticket

  8.25(2)

 

Other charges

 

 

Amount ($)

Replacement PRESTO card

6.00

Day Pass

7.75

U-Pass – Per semester

180.00(2)

Special event service – First hour

310.00

Special event service – Each additional hour

155.00

Park and ride permit – Gold permit

51.25

Park and ride permit – Baseline and Jeanne d’Arc

22.50

 

Notes:

1.    These fare types are planned to be phased out during 2012-13

2.    These fares have already been approved by Council

 

                                                                                                                                      Document 2

Comparison with previous year

 

Pay-per-month fares (passes)

 

Customer Group

Service Type

Recommended 2012-13 Fare

Comparable

2011-12 Fare

Change

Adult

Regular

96.25

94.00

+2.4%

Adult

Express

119.00

116.00

+2.6%

Adult

Rural Express

145.00

-17.9%(1)

Student

Regular

76.75

75.00

+2.3%

Student

Express

90.25

88.00

+2.6%

Student

Rural Express

113.00

-20.1%(1)

Senior

All

39.00

37.00

+5.4%

Community

All

32.00

32.00

No change

 

Pay-per-ride fares

 

Customer Group

Service Type

Payment Method

Recommended 2012-13 Fare

Comparable

2011-12 Fare

Change

Adult/Student

Regular

e-Purse

2.65

2.60

+1.9%

Adult/Student/Senior

Regular

Ticket

3.00

2.60

+15.4%

Adult/Student

Regular

Cash

3.30

3.25

+1.5%

Adult/Student/Senior

Express

e-Purse

4.00

3.90

+2.6%

Adult/Student/Senior

Express

Ticket

4.50

3.90

+15.4%

Adult/Student/Senior

Express

Cash

4.65

4.25

+9.4%

Adult/Student/Senior

Rural Express

e-Purse

-

5.20

  -23.1% (1)

Adult/Student/Senior

Rural Express

Ticket

-

5.20

  -13.5% (1)

Adult/Student/Senior

Rural Express

Cash

-

5.25

  -11.4% (1)

Senior

Regular

e-Purse

2.00

2.60

-23.0%

Senior

Regular

Cash

2.50

3.25

-23.1%

Child

All

e-Purse

1.50

1.30

+15.4%

Child

All

Ticket

1.50

1.30

+15.4%

Child

All

Cash

1.75

1.60

+9.4%

 

Notes

1.    Compares 2011-12 Rural Express fares with recommended 2012-13 Express fares.