A detailed independent study of fare-free operations at the Merrimack Valley Regional Transit Authority (MeVa) has concluded that the operational and social benefits of running fare-free buses are considerably greater than the value of the fare revenue that the agency used to collect from its riders.
For the past year, consultants from Stantec, with support from the Merrimack Valley Planning Commission (MVPC), have been studying the business case for fare-free operation at MeVa.
After hearing a presentation on the report's findings, the MeVa Advisory Board voted Thursday morning to adopt a "permanent" fare-free policy on all its routes.
"The value of the program far exceeds the costs of lost fare revenue, providing a compelling business case for continuing and expanding fare-free transit options,” said Stantec consultant Liza Cohen.
Higher ridership, happier workers, lower costs
Since it adopted a fare-free policy in early 2022, MeVa's ridership has surged. The agency's ridership today exceeds its pre-pandemic levels by about 60 percent, although some of that increase can be credited to service improvements.
“What had been empty seats on our buses before are now full seats, and we’re running more efficiently,” MeVa administrator Noah Berger told advisory board members at Thursday's meeting.
Replacing fares with other government funding turned out to save a considerable amount of time and hassle for MeVa's workers.
"Maintenance staff mentioned spending time moving the physical money from the buses into the vault, which was something that had to happen frequently. They were also spending quite a lot of time on farebox maintenance," said Cohen.
Now that those tasks aren't necessary, MeVa's maintenance staff have "over 100 hours saved weekly" to focus on more important maintenance and repair activities, said Cohen.
The policy has also yielded a considerable reduction in rider complaints, even though there are considerably more people riding the bus now.
Drivers reported that the lack of fare collection has also removed a major source of conflict between drivers and riders who previously couldn’t pay.
“Driver satisfaction is significantly higher,” said Cohen.
Regional economy benefits: better access, less congestion
While there were significant benefits to MeVa's operations, the consultants found that the benefits to the larger communtity were much greater.
To figure out how riders and the community at large was profiting from the new policy, Stantec administered a bilingual, in-person rider survey on MeVa's bus routes and at transit centers. They also interviewed drivers and local service organizations, and collected additional data from Census data, crash records, traffic counts, school attendance data, and other sources.
That rider survey data suggests that roughly one in five MeVa bus trips in 2023 and 2024 would have been made in a private car – most likely a taxi or rideshare – if the fare-free policy had not been in place.
Because private automobiles impose such large costs to their owners and to society at large, that relatively small amount of mode shift generated $1.7 million in social benefits, including nearly $1 million in savings from avoided vehicle operating costs and another quarter-million dollars in savings from reduced traffic congestion.
Stantec's consultants also found evidence of even larger benefits that can't as easily be quantified.
Trips to medical centers like Lawrence General Hospital nearly doubled after the fare-free policy took effect. Trips to Lawrence High School more than doubled.
“Seniors who ride fixed-route (buses) and paratransit just talked about a sense of freedom and independence not having to wait for a ride to get to their appointment,” said Cohen.
The study team also found evidence that riders were visiting local businesses more often.
“If I was paying for all the rides, you're looking at $80 a month. That's pretty much my grocery bill,” one rider told the survey team. "But now we're saving. Certainly, that's more I can use for my groceries."
$1.5 million from fares vs. $2 million in benefits from fare-free operation
All told, Stantec found that fare-free operations delivered $2 million a year in quantifiable benefits to MeVa and the cities it serves.
"The monetary value of those benefits supports a business case for
the fare-free program, as they well exceed the costs of lost fare revenue," their report concludes.
After hearing Stantec's presentation, MeVa's advisory board adopted a resolution to "permanently" adopt a fare-free policy, rather than approving it on a year-to-year basis, as they'd previously done.
Read a detailed summary of Stantec's "MeVa Fare-Free Evaluation and Business Case" here.
