Pass Programs, Fare Programs and Fare Policy Analysis Marla Lien, General Counsel Regional Transportation District, Denver, CO
Types of Discount Fare Programs: Frequency Discounts (multi-ride, monthly or annual passes) Volume Purchase Discount (RTD EcoPass, College Pass, Student Pass, Neighborhood Pass) Tax Discount Employer sponsored pre-tax benefit (26 U.S.C. 132 (f); I.R.S. Publication 15-B, currently $130 per month) Income Based Discounts
Fare Equity Considerations FTA requires federal grantees to perform a fare Equity Analysis for all fare changes 49 C.F.R. Part 21 Nondiscrimination in Federally Assisted Programs Effectuation of Title VI of the Civil Rights Act of 1964 Appendix A: Activities to which Part 21 applies: 13) Use of grants and loans made in connection with public transportation programs (49 U.S.C. chapter 53) Fare Equity analysis also includes consideration of Executive Order 12898 (Environmental Justice)
FTA Guidance Circular 4702.1B Title VI Compliane Circular 4703.1 Environmental Justice Compliance Analysis to determine whether fare changes are disproportionately borne by Environmental Justice (EJ) Populations is described in the Title VI Circular (pg. 39) Master Agreement Section 12 requires compliance with FTA Circulars Circular 4701.1B Appendix K Fare Equity Analysis (checklists is for both Title VI and EJ Circulars)
FTA Oversight Relevant Definitions from Circular 4702.1B: Discrimination refers to any action or inaction, whether intentional or unintentional, in any program or activity of a Federal aid recipient, subrecipient, or contractor that results in disparate treatment, disparate impact, or perpetuating the effects of prior discrimination based on race, color, or national origin.
FTA Oversight Definitions (cont.) Disparate impact refers to a facially neutral policy or practice that disproportionately affects members of a group identified by race, color, or national origin, where the recipient s policy or practice lacks a substantial legitimate justification and where there exists one or more alternatives that would serve the same legitimate objectives but with less disproportionate effect on the basis of race, color, or national origin.
FTA Oversight Definitions (cont.) Disproportionate burden refers to a neutral policy or practice that disproportionately affects lowincome populations more than non-low-income populations. A finding of disproportionate burden requires the recipient to evaluate alternatives and mitigate burdens where practicable.
FTA Oversight Definitions (cont.) Disparate treatment refers to a actions that result in circumstances where similarly situated persons are intentionally treated differently (i.e., less favorably) than others because of their race, color, or national origin.
FTA Oversight Definitions (cont.) Noncompliance refers to an FTA determination that the recipient is not in compliance with the DOT Title VI regulations, and has engaged in activities that have had the purpose or effect of denying persons the benefits of, excluding from participation in, or subjecting persons to discrimination in the recipient s program or activity on the basis of race, color, or national origin.
Civil Liability FTA determination of noncompliance is distinct from civil liability. See, Alexander v. Sandoval 532 US 275, 121 S.Ct.1511 (2001) Title VI allows agencies to promulgate disparate impact regulations but do not allow a private right of action for enforcement.
Civil Liability (cont.) Suits based on disparate impact have had limited success: New York Urban League Inc. v. State of New York, 71 F3d 1031 (1995). Preliminary injunction sought due to disparate impact of fare increases on urban and suburban riders, based on farebox recovery ratios for different services. Court founds variety and complexity of factors related to revenue and costs of service were such the farebox recovery alone was not sufficient basis for a preliminary injunction stopping proposed fare increase.
Civil Liability (cont.) Darensburg v. Metro Transportation Commission 611 F. Supp 2d 944 (2009) Suit brought under state law very similar to Title VI. Plaintiffs alleged disparate impact based on funding decisions for a variety of services form a variety of sources. Court made over 300 Findings of Fact and ultimately concluded that based on variety and complexity of decisions, types of services and reasons for decision, no disparate impact.
Civil Liability (cont.) But, in Mungia v. Illinois, 2010 WL 3172740 Plaintiffs alleged once agency knew of disparate impacts implementation was intentional. The claim was dismissed because no disparate impact was found.
Equity Analysis Appendix K to Circular 4702.1B is for both disparate impact and disproportionate burden analysis. If there is a disparate impact need to substantial legitimate justification and show there are no alternatives that would have a less disparate impact and still accomplish legitimate program goals. If transit provider goes forward, propose mitigation. If there is a disproportionate burden take steps to avoid, minimize or mitigate the impact.
RTD Pass Programs Before and After 2016 Fare Changes Business EcoPass Utilization Percent of all riders that pay with EcoPass Percent of Minority riders that pay with EcoPass Percent of Non Minority riders that pay with EcoPass Percent of Low Income riders that pay with EcoPass Percent of Non Low Income riders that pay with EcoPass 19.0% 12.1% 23.4% 2.4% 34.0%
RTD Pass Programs Before and After 2016 Fare Changes (cont.) 2015 Structure Average Fare Paid per Trip Business EcoPass Total System Local Bus $1.56 $1.95 Express Bus $2.78 $3.25 Regional Bus $3.47 $4.12 Local Rail $1.56 $1.99 Express Rail $2.78 $3.44 Regional Rail $3.47 $4.41 SkyRide $3.47 $5.42 Total $2.28 $2.47 2016 Structure with 18% Increase for EcoPass Average Fare Paid per Trip Business EcoPass Total System Local Bus $2.23 $2.40 Express Bus $3.70 $3.99 Regional Bus $3.87 $4.20 Local Rail $2.23 $2.50 Express Rail $3.05 $3.39 Regional Rail $3.87 $4.40 SkyRide $3.87 $5.22 Total $2.83 $2.83
RTD Nonprofit Agency Reduced Fare Program Program started more than 25 years ago Program open to government agencies and nonprofits that assist low-income individuals Income eligibility based on Women Infant and Children guidelines published by U.S. Department of Agriculture at 7.C.F.R Part 246 Currently 240+ participating agencies Agencies purchase $6 million in fare media annually at discount rates 17
2016 Changes Change the name of the program to RTD Nonprofit Program Provide a consistent 50 percent discount for all fare media 10 Ride ticket books Day Pass coupon books Monthly Passes Streamline administration by reducing reporting requirements and frequency of reporting 18
2016 Changes (cont.) Allow agencies to recover the entire cost paid to RTD from their clients if they choose Allow a primary account holder (such as county human services) to distribute pass products to other agencies with proper documentation Improve payment and pick-up options allowing returns of unused monthly passes for credit, offer delivery at agency expense 19
Revenue Impact Demand for the program is expected to increase with the proposed changes Staff recommends that a monthly cap be placed on the number of passes sold each month Guarantee current purchase quantities plus 10% for existing agencies Monitor program to determine if additional funding should be identified for this program 20