Could PCEF funds be used to make public transit in Portland Free?

Photo by Slava Keyzman on Unsplash

Portland used to be considered a national leader in public transportation. When I first moved to the metro area after college, I would frequently ride the trains in from the west suburbs, taking advantage of the fareless square in the central city. However, in response to tightening budgets and unsupported criticism about the “types of people” that use public transit, Tri-Met moved away from fareless square and has been slow to champion new innovations outside of their current operations.

On January 1st, Tri-Met imposed a modest fare increase for public transit riders. This, in addition to frequent service delays and declining routes, have led to a lot of frustration within the community that rely on city busses and trains. At the same time, the city of Portland is sitting on an unexpected excess of funds from the Portland Clean Energy Fund.  What if the future of Tri-Met is moving towards $0 passenger fares, and what if the funds to do that already exist?

Is free public transportation a good idea?

The simple answer is yes… Expanding Tri-Met usage could significantly contribute to many of our city’s public goals. For example, it would remove all barriers to transportation for low-income Portlanders, promote a carbon alternative transportation system, and potentially boost activity in the Central City.

 Next, it’s important to know that this isn’t a new idea, and it has been implemented in other cities in the US…

·        Washington D.C. was recently the largest city in the country to make their public transportation complete free (https://bikeportland.org/2022/12/07/washington-d-c-council-votes-for-free-transit-citywide-367996).

·        In November of 2022, Portland State economist Mary King wrote an article in Street Roots calling for an increased payroll tax to make up the passenger fee and provide fee transit. (https://www.streetroots.org/news/2022/11/22/opinion-trimet-should-eliminate-fares-not-increase-them).

How much would it cost?

Based on my review of Tri-Met’s budget, passenger revenue was projected to be 7.7% of the total revenue for 2024, the remaining coming from a growing employer payroll tax base. Without getting too far into the weeds, a rough estimate for removing the passenger fees and maintaining current service levels would be $50 million per year. (This is based on the entire Tri-Met region, narrowing the amount to Portland specific would require more research but ultimately produce a significantly smaller number)

There are also realistic ways that the $50 million could potentially be significantly decreased over time. For example, block granting dollars to Tri-Met would allow for interest accrual on their revenue compared to the trickle in of passenger fares over the course of a year. Then there is the issue of fare collection and the expenses associated with it. As shown in the chart below, the cost of collecting fares is approximately $10-$12 million per year (estimate based on my reading of Tri-Met budget documents).

 Is this a good use of PCEF funds?

Commissioner Rubio and the Portland Clean Energy Fund are exploring how subsidized public transit would help our city achieve our environmental goals and possible be a good use of the $540 million in excess PCEF revenue. (https://www.opb.org/article/2023/12/13/portland-city-commissioner-proposes-540m-of-climate-action-funds-toward-city-bureaus/)

I agree with the position that our city should use funds over and above the original intended amount to fund current bureau services, assuming they meet the overarching goals of the program. Whether funding public transportation outweighs increased funding for affordable housing, preventing budget cuts at PBOT, or a myriad of other city functions that desperately need money is a valid question. The main point of this post is to bring attention to the fact that Portland already has great ideas and great programs. We should consider re-investing in them instead of reinventing the wheel.

Final Note…

After writing this post I had the opportunity to meet with a friend of mine that works in policy at Tri-Met. I proposed this thought exercise and feel like it is important to share her answers…

·        Yes, Tri-Met is interested in how they could access PCEF funds

·        No, free public transportation has not been introduced as a potential use of those funds

·        Why? Tri-Met is more focused on investing in clean-energy system upgrades and route expansion.

My thoughts after that conversation don’t change much. I support any ideas that leverage our existing systems and infrastructure to move towards our city’s climate goals. Whether it is reducing fees or investing in clean technology, our public transit system has a valid argument to be included in PCEF funding.

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