Sound Transit leader warns of steep drop in revenue

The head of the regional transit agency Sound Transit says revenue from fares on buses and trains has dropped significantly in recent years as operating costs climb, creating a "financially unsustainable" trajectory.

CEO Peter Rogoff told board members Thursday that depressed ridership because of the pandemic underpins much of the drop in revenue. The Seattle Times reports that Rogoff also blamed an increase in passengers who ride without paying, which comes as Sound Transit’s enforcement presence is significantly scaled back.

"When you’ve got a situation with a 98% chance of being out on the system and not being contacted by anybody to have any conversation, that just lends itself to further noncompliance," he said. "We need to get back to a place where our passengers are honoring the honor system that we’re using."

Rogoff’s warnings come as Sound Transit works to revamp its approach to fare enforcement, which was shown to disproportionately land on people of color.

The agency previously employed security guards to check that riders had paid before boarding, but is currently testing the use of "fare ambassadors" instead. The ambassadors are not issuing citations for noncompliance, but instead are offering educational materials.

Some advocates have pushed Sound Transit to focus more on transit access over fare enforcement. But fare collection is a cornerstone of the agency’s long-term financial plan and recent negative trends necessitate action, Rogoff said.

The board, made up of elected and appointed leaders from across the region, will soon decide how it wants to proceed on fare enforcement.

Sound Transit awarded federal grants for light rail projects

Sound Transit will receive more than $250 million in two federal grants for its light rail projects.

From 2019 to 2020, revenue from fares dropped from $96 million to just $30 million as ridership dried up during shutdowns. Where revenue covered 32% of Link light rail’s operating cost in 2019, it made up 8% in 2020. When all is accounted for, Sound Transit staff forecasts that just 5% of light rail’s operating costs will have been covered by fare revenue in 2021. The agency’s board had previously set a goal of 40%, which it has only met once, in 2017.

In November 2021, ridership across all Sound Transit modes was just over 2 million people, compared to around 4 million before the pandemic.

Fare revenue from employer-provided ORCA cards was also down, from $48 million in 2019 to $13 million in 2021.

Sound Transit briefly suspended all fares in April and May 2020, as the state went into widespread lockdown. Fares went back into effect in June, but enforcement has not. The ambassador program launched in September of last year.

Rogoff, who is leaving the agency this spring, presented the board with data showing a jump in "fare evasion" from 3% in 2018-19 to between 10% and 30% in 2020-21, based on information collected by fare enforcement officers or ambassadors as they ask riders for proof of payment.

As many as 40% to 70% of riders were "nonfare" passengers — which includes riders in 2020-21 who were exempt from fares for various reasons, such as age, as opposed to 14% in 2018-19.

The steep declines come as overall costs are projected to increase with an expanded light-rail network by as much as $3 billion through 2046.

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