A proposal to make Eugene, Oregon's bus system fare-free has been voted down by the regional transit district.
"LTD officials recently completed their analysis and came up with this conclusion: It doesn't pencil out."
"Free bus service has worked in some smaller communities where there's still plenty of capacity for new riders. "But we're in a different situation where we can't afford to absorb any more ridership," said Andy Vobora, LTD's director of service planning."
"Only 20 percent to 30 percent of LTD customers pay cash fares, with many more riding 'free' because of group pass plans paid for by their employers or schools. Fares of all types generate about $5.5 million annually for LTD, or roughly 15 percent of all revenues; a payroll tax on local businesses is the district's primary revenue source."
"Though some money would be saved by not collecting fares, LTD would still be looking at a total revenue gap of up to $5 million if it eliminated all fares - and would need some new state or local subsidy to make up the difference, Vobora said. Otherwise, LTD would have to look at budget and service cuts, he said."