T view on fare-free buses: Demand up, revenue down

Offering all MBTA bus trips free of fares could carry a price tag of hundreds of millions of dollars, driven by both increased operating costs and foregone revenue, T officials said on Monday.

As the transit agency weighs new low-income fare options and pushes toward an overhaul of how riders pay to take trips, MBTA staff outlined impacts that they believe could stem from eliminating fares on buses. Several elected officials, including Boston Mayor Kim Janey, have called for the T to make buses free to riders.

The MBTA is required by law to offer its paratransit service at no more than twice the price of similar fixed-route bus fares, so under the current rules, making buses free would also require the T to make the RIDE free. Fare-free options could lead to between 5 million and 13 million additional rides on local buses per year, a 5 to 11 percent increase over pre-Covid levels, according to MBTA Acting Assistant General Manage Lynsey Heffernan.

The T might also need to serve a 25 to 45 percent increase in demand on the RIDE paratransit service, representing 400,000 to 700,000 more trips, Heffernan said. Without boosting service to meet the increase in demand, Heffernan said the midpoint cost estimate for fare-free buses and RIDE service — including lost revenue, plus additional capital and operating expenses — would be $117 million in the first year and $105 million each year afterward. If the T increased service, the midpoint cost estimate would rise to $452 million in the first year and $153 million annually thereafter, largely driven by significant investment needed in year one to expand the bus fleet and maintenance facilities.

“All of these capital investments, particularly in bus infrastructure, take a significant time to implement, so those are not things that we could move forward with very quickly,” Heffernan told the Fiscal and Management Control Board.

Ultimately, decisions on free bus rides and other changes at the T could land in the lap of the Legislature, which may want a say over transit policies and has a larger budget and revenue pool to draw from than the T.