Comments on: AATA Financial Group: Let’s Continue

By: Vivienne Armentrout

Vivienne Armentrout — Wed, 29 Feb 2012 18:13:16 +0000

What the discussion on fares did not reflect is that AATA has a complex fare structure with many discounts and special fares, each of which has been crafted to achieve a distinct policy objective. The “base fare” is hardly paid by everyone. So when they say “average fare”, do they in fact mean an average yield over all fare classes? That might change with the season and for other reasons. For example, the GoPass system is subsidized both by the DDA and by AATA’s decision to accept less compensation for the program even as participation increases. The more people who utilize this (valuable) program, the lower the nominal fare.

And of course, there is the question of elasticity of demand, so as fares go up, ridership may decline, which lowers the revenue from fares. Etc. As you say, leave it to the consultants.

By: Dave Askins

Dave Askins — Wed, 29 Feb 2012 17:51:52 +0000

Re: [1] possible basic fare of $2 with additional from outside city limits into Ann Arbor Ken, I think what you're describing is certainly consistent with what the financial advisory group has in mind. But so would a lot of other different fare structures. The group would like the word "average" in the description of a $2 average fare to carry a lot of the meaning, which I think the board is content to leave vague at this point. In fact, the lack of specificity on fare structure is one of several points identified by the group as leading to the conclusion that it cannot at this time make a final funding recommendation. From the report:

The sub-group's recommendations regarding passenger fares are fairly general. The recommendations should be more fully developed to identify the specific services and markets whose fares would be affected, the phase-in period for any fare changes, and the resulting financial impacts on the Program.

Related to fares, it's worth noting that the AATA board approved an increase in the budget for its consultant at its Feb. 16, 2012 meeting, and one of the specific tasks identified for the increased contract is to work on fare structures and methods of payment.

By: Ken

Ken — Wed, 29 Feb 2012 16:25:49 +0000

Well now it sounds as though the finance committee is asking more questions than answering. So if my math is correct the base fare just to climb on board an AATA bus would then be $2.00? Any Express route from the burbs into A2 or the reverse would cost extra beyond the $2.00 fare?