Expand use of Commuter Benefits

Assumptions

• Universal Transit Passes have the potential to decrease driving rates for work and school trips in San Francisco by 5 percent.
• Cost estimates do not account for the new transit service that would be required to accommodate thousands of new riders on crowded Muni routes

Analysis

Research has shown that universal transit passes implemented by employers, universities, and residential developers have the potential to shift workers from driving to transit ridership. However, the usefulness of universal transit passes may limited in environments where transit is already highly competitive. In particular, peak-hour riders on the key travel corridors in the Bay Area, where there are already transit capacity constraints, high parking costs, congested roadways, and walkable, mixed use neighborhoods, may be relatively insensitive to the cost of transit. Further, if the idea were implemented on a large scale in San Francisco, an area with already well-used transit, new riders could push demand for space on Muni vehicles above capacity. In such cases, additional funds may have to be provided to augment transit service. For this reason, universal transit passes would be most effectively deployed in a targeted fashion.

What we do now
Currently, Muni riders pay a cash fare or individually purchase one of a variety of passes. Muni’s Fast Pass provides adults with unlimited rides for $45 per month.

What we could do
Numerous transit agencies have teamed with universities, employers, or residential neighborhoods to provide Universal Transit Passes. These passes typically provide unlimited rides on local or regional transit providers for low monthly fees, often absorbed entirely by the employer, school, developer or homeowners’ association. They are particularly cost effective when they allow transit users to take advantage of transit capacity that might otherwise go unused. For employers, transit passes can double as a fringe benefit. Universities have the advantage of having a large population of users who may particularly receptive to transit uses. For each of these types of organizations, transit use may cut the demand for parking, saving the organization money.

A type of universal transit pass could also be created for residential developers and homeowners associations. Transportation demand management strategies such as universal transit passes allow developers to offer incentives to potential residents, and to create lower-traffic developments that may be more attractive to the surrounding community and reduce the need for more costly traffic impact mitigation.

Cost
The principle of employee and residential universal transit passes is similar to that of group insurance plans – transit agencies can offer deep bulk discounts when selling passes to a large group, with universal enrollment, on the basis that not all those offered the pass will actually use them regularly. A review of existing programs found that the annual per person fees are generally between 1 percent and 17 percent of the retail price for an equivalent annual transit pass.² In San Francisco, this is equivalent to $0.45 and $7.65 per month. If pass programs could be structured so that universities and city departments, paid an average of $5 per person covered, the total cost for 30,000 city workers and 61,000 university students and staff would be $455,000. Regulations could compel HOAs and private developers to purchase universal transit passes at no public cost.

These cost estimates reflect the likely retail purchase price of the passes for the institutions (universities and city departments) that purchase them. We have not attempted to calculate the cost impact on Muni. For Muni, the cost of universal transit passes would depend upon where and how they were deployed. Where transit passes would add riders to routes that now have spare capacity, the marginal cost would be $0. Where additional ridership created the need for new capacity, the cost per passenger would be very high. In this analysis, we have not attempted to calculate the cost of new service that Muni would need to provide in order to accommodate thousands of new riders on routes that are already at or near capacity.

Carbon Savings Potential
Residential Developments/HOAs: It is estimated that new development will house 170,600 new employed residents in San Francisco by 2030. Thirty-six percent of these new workers will drive to work, generating 763,000 VMT per day, or 195 million VMT per year. Used strategically, universal transit passes have the potential to reduce VMT from driving by up to 10 percent. However, If we assume that the policy could generate a 5 percent reduction at the typical new development, then the maximum possible annual reduction by 2030 would be 9.7 million VMT, or 3,500 metric tons. Because residence-based transit passes would be phased in with new construction, the benefits would be small at first and build over time.

Universities: The daily population of San Francisco’s universities is an estimated 61,000. Extrapolating from mode share of travel at San Francisco State University, we can estimate that approximately 18,300 students and staff drive to school and work each day. If we assume that a system of universal transit passes can decrease driver trips by 5 percent, then the maximum possible annual reduction will be 2.9 million VMT, or 1,000 metric tons. These measures could be implemented much more quickly for universities than for new residential developments. If we assume that pass programs could be established at $5 per student/staff member, then the cost per ton of emissions abatement would be about $140.

Employers: The City of San Francisco could create a universal transit pass for its own employees. Currently, the city employs approximately 30,000 workers, of whom an estimated 30 percent drive to work. If a universal transit pass system decreased driver trips by 5 percent, the resulting decrease then the maximum possible annual reduction will be 2.7 million VMT, or just under 1,000 metric tons. If we assume that pass programs could be established at a cost of $5 per employee, then the cost per ton of emissions abatement would be about $140.

Endnotes
¹ Five dollars per participant for 61,000 university students and staff, and 30,000 municipal workers. This cost reflects the likely purchase price of the passes for the universities and city departments, but not the cost to Muni of providing additional transit service.
² Pasadena Traffic Reduction Study. Nelson\Nygaard, 2006. www.ci.pasadena.ca.us/trans/ARCHIVE/20070421_Workshop/Pasadena_Traffic_Reduction_Strategies_11_2_06_DRAFT.pdf