Agency can no longer afford free rides
We’re glad Capital Metro board member Norm Chafetz is asking whether the transit agency can — and should — recover more of its costs in providing exclusive bus service for the University of Texas. As it stands, UT pays nearly half of what it costs Capital Metro to transport students and others around its Austin campus.
The numbers work out this way: Capital Metro spent $108.1 million during the past decade running its shuttle bus system for UT students, staffers and faculty members. UT paid the transit agency $52.8 million for the service, or about 49 percent of the cost.
That arrangement did not strain the agency back when it was flush with cash. But it is a contract that needs to be revisited in light of Capital Metro’s troubled financial affairs because of soaring costs the agency failed to plan for and lagging sales tax revenues. For now we agree with Chafetz, who is recommending that the contract with UT be renewed for two years (instead of three) so that Capital Metro’s new chief executive officer, Linda Watson, can revisit the contract sooner.
That is reasonable given that UT is pay- ing nearly half the cost for the specialized shuttle service on top of what students, staff and faculty pay in sales taxes that finance Capital Metro’s operating budget. But there are other fare policies that need to be addressed sooner because they have become huge financial liabilities that are depleting Capital Metro’s budget.
Given its financial predicament, Capital Metro no longer can afford a fare policy that awards free rides to seniors and people with disabilities. It is not a policy based on need; all seniors and people with disabilities — no matter how wealthy — get that break.
And while no one is suggesting that those passengers pay full fare, attempts to charge them 50 cents (half the regular $1.00 fare) to ride the buses have triggered political storms.
Capital Metro’s former board chairwoman, Margaret Gómez, successfully pushed the board to defeat a proposal for a 25 cents fare for passengers who now ride for free. That was last year, when Gómez was running for re-election for Travis County Commissioner.
Free rides for seniors and others were nice perks when the agency was flush with cash. But the agency, which has struggled to maintain solvency, no longer can sustain free service.
With about 30 percent of its passengers riding for free, Capital Metro is forfeiting nearly $1.7 million a year based on a 50 cent fare or about $850,000 a year based on 25 cents.
Another fare policy that the agency must revise provides door-to-door service for persons with disabilities who are unable to ride regular buses. Vans or sedans pick up and drop off passengers for medical appointments, shopping and other activities.
We are not suggesting that the agency eliminate or scale back the service, which exceeds requirements of the Americans with Disabilities Act. The agency’s policy should reflect the values of Central Texas, and we’re glad it does that. But the service in its present form is not financially sustainable and must be made more equitable.
In fiscal year 2009, Capital Metro spent nearly $20 million — about 10 percent of its budget — to serve 7,000 clients who use the specialized service. Riders pay just $1.20 each for the door-to-door service instead of the full $2.00 permitted by federal law. The agency could recover $460,000 more yearly by raising the fee to $2.00.
Mismanagement and poor planning have contributed to Capital Metro’s financial woes. The agency would be in much better shape had it raised fares for the above-mentioned services — as well as for regular bus service — years ago during good economic times. The agency now is playing catch-up with its finances.
Getting the agency’s finances in order will require in part revising generous transit services that Capital Metro no longer can afford.