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Caltrain Board Suspends Fare Increases, Approves New Equity Policy

Caltrain Board Suspends Fare Increases, Approves New Equity Policy

 

Budget Estimates show New Investment is needed to Maintain Service, Advance Equity Improvements

Facing an estimated $18.5 million shortfall, the Caltrain Board of Directors voted to postpone adoption of Fiscal Year (FY) 2021 Operating and Capital Budgets until their October Board meeting, where they will consider approving a budget that covers operations through the end of 2020.

The Board also took steps to enhance affordability and accessibility of the system by postponing previously-approved fare increases until after June 2021, and approving the system’s first Framework for Equity, Connectivity, Recovery and Growth. The Framework is part of the Caltrain Business Plan, an ongoing effort to define how the service will grow to meet the evolving needs of the region. The equity policies included in the Framework will help ensure that the rail service’s recovery from the coronavirus (COVID-19) pandemic occurs in a way that expands access to low-income individuals and communities of color that have historically been underrepresented in the system’s ridership.

In order to implement the Equity Framework, Caltrain will need to survive the impacts of the pandemic that have reduced ridership by 95%. To make up for this ridership loss and maintain service over the next year, the agency estimates it will need to identify an additional $18.5 million.

During the region’s shelter-in-place, over 3,500 weekday riders continue to rely on Caltrain for essential travel. Many of these riders are lower-income workers that do not have access to a car and depend on Caltrain to get to frontline jobs. The Board’s decision to suspend certain fare increases over the next year will help ensure the system continues to be accessible to these riders. Caltrain has taken additional steps during the pandemic to enhance affordability by providing low-income riders with a 50% discounted fare.

The Equity Framework envisions preserving this discount in the longer term, and would facilitate additional steps to increase social and racial equity on the system now, and in the future. The policies in the framework would improve connections to other local and regional systems that disadvantaged riders are more likely to rely on. It would also support increased off-peak service to make the system more relevant for workers with non-traditional work hours. Under the framework, Caltrain would also work toward better regionally coordinated fare and transfer policies.

Prior to the pandemic, Caltrain was working to identify new revenues that would allow it to implement these equity improvements. Now, the latest Caltrain budget estimates show that those new revenues will also be necessary for the system to survive the pandemic.

Caltrain staff identified a number of other potential revenue sources, including the sale of naming rights that are being pursued to help cover the projected $18.5 million shortfall. In August, the Board voted to place Measure RR on the November 3 ballot in San Mateo, San Francisco, and Santa Clara counties. If approved by two thirds of voters, funds from the measure could be leveraged to cover the budget shortfall and to implement the service and fare policies called for in the Equity Framework.

If no additional funding is identified, the rail service is at risk of shutting down. Cutting service would reduce expenses, but that savings could be negated by reduced revenue from the system’s GoPass program, which provides discounted annual passes to participating employers. Even shutting down the system would carry costs as during a shutdown, the agency would still be responsible for maintaining the corridor for freight rail operations. The cost of a 12 month shutdown is estimated to be over $60 million. It would also take more than a year to restart service after a shutdown. The remobilization and retraining of staff over that time would cost an estimated $93 million.

“Adopting policies embedded within the Equity Framework will improve the accessibility and affordability of Caltrain for the most vulnerable members of the communities that Caltrain serves,” said Caltrain Board Chair Dave Pine. “To ensure that these policies are successful, it is imperative that the system has new and reliable revenue to maintain service now and in the future. Any shutdown of the service would be the most inequitable consequence possible for all riders who depend upon this critical service.”

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About Caltrain: Owned and operated by the Peninsula Corridor Joint Powers Board, Caltrain provides commuter rail service from San Francisco to San Jose, with commute service to Gilroy. While the Joint Powers Board assumed operating responsibilities for the service in 1992, the railroad has provided the community with more than 150 years of continuous passenger service. Planning for the next 150 years of Peninsula rail service, Caltrain is on pace to electrify the corridor, reduce diesel emissions by 97 percent by 2040 and add more service to more stations.

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Media Contact: Dan Lieberman, 650.622.2492