Metro riders are getting more out of their fare cards, one more reason why the transit agency says it is getting squeezed economically.
The agency says it is earning less money than in the past from unused fares — when, for example, a rider throws away a fare card with a few cents left. Instead, passengers are using reloadable plastic SmarTrip cards and wasting less of the money they have paid.
That’s good news for riders, but bad news for Metro.
The shift, Metro says, means it cannot count on an estimated $11 million in next year’s proposed budget. The problem is one of the factors causing the yawning $175 million gap in the $1.4 billion operating budget.
For the past two years, the agency assumed it could tap into about 5 percent of fares when riders failed to use all the money on their cards, Chief Financial Officer Carol Kissal told board members.
But she said that assumption was now too high. Instead, she said, Metro should assume that 3 percent of fares would never be used.
The issue is complicated because the agency doesn’t count fare money when it’s bought; instead it puts it on the books only when it is used. The unused portion is considered revenue after a set period when the agency believes it is safe to declare it unused.
The need for the change is not surprising. In April, the transit agency phased out the paper Metrochek fare vouchers given out by employers. It has been encouraging more riders to use the SmarTrip cards.
SmarTrip card use rose to 75 percent of rail trips in October, compared with 69 percent in a three-month period last year, according to Metro. The jump on Metrobus was even higher, with SmarTrip use at 60 percent in October from 29 percent in 2008.
“As we move in this direction, we will have less revenue that we can declare,”said Peter Benjamin, a board member and the authority’s former chief financial officer. “We will get down to practically nothing.”
Metro has raked in some unexpected unused money, though. The agency estimates that $2 million in fares bought for the inauguration went unused, likely from commemorative Barack Obama fare cards kept as keepsakes.
But to fill the hole in the future, Metro likely will ask riders to make up the difference, and then some, by seeking fare increases next year. A staff proposal calls for $92.5 million in fare increases — the equivalent of about 15 percent increases if issued across the board — to close the budget gap.
