Everyone knows about transit, it is even part of daily life for many who use it as their primary mode of transport. Almost everyone has to pay to get on transit, the price to pay, or fare, is usually around 3 to 5 Canadian dollars. In this article, you’ll know weither or not a sustainable transit agency can afford to be free.
First up, let’s talk ridership. By logic if it costs money, you’ll lean more towards taking your car, especially if you live in a suburban place, as it is more convenient to use, and you can go where you want, wen you want, as long as you have gas in it. If the bus is free, you might look at the schedules and try to take that instead knowing you’re saving up on gas money. For this comparaison, I’ll use Stratford (pop. 36 500) and Orangeville (pop. 32 600). Both towns are in SouthernWestern Ontario and have transit systems; Stratford’s has a fare, Orangeville doesn’t. To better capture how much people use transit, I’ll let the numbers speak. Stratford, with it’s 3$ fare, saw about 2.5% of it’s population on it’s busses, Orangeville, on the other hand, is expected to see 4 to 5% in 2026, that’s a 2x jump only for it being 3$ less.
Now, with cheaper busses and more people, you might think they’re going to go bankrupt, but Orangeville’s system is half as in debt as Stratford’s system. A reason of that might be that; keeping up and running a fare collection system can be quite costly. In Orangeville, before it’s fare-free project, 80 000 out of the 150 000$ from fare revenue went towards maintaining the system. Now that they don’t make money off fares, they’re about 70 000$ in the hole which may look like a lot, but it’s about the price of a fancy car. You still have to remember, that’s a city of 32 000 people, so the 3$ fare they used to pay twice daily, is now 2.50$ annually paid as taxes, that’s a huge downwards spike over what it used to be.
Secondly, advertisements exist, let’s say you have a fare and put an ad in the bus. Maybe 2% of you population will see it. If the ad company pays 1$ per view, over 30 000 people, that’s about 600$ from ad revenue alone. Now, if you, for say, have a fare-free system, that 8% of 30 000 is about 2400 people, so 2400$ which can go up even faster if more and more people take the free bus.
I won’t go into too many details but many fare-free cities do better than most fared cities. I hope you liked this first article of mine and I will be releasing more soon. If you want to learn more about transit news and concepts, feel free to subscribe here and on my Youtube channels.