Iowa City buses may be free for all riders later this year as Iowa City Council considers zero-fare transit system

The Iowa City City Council is considering making its public transit system free for all riders across a two-year span.

Iowa City Transit recommended prioritizing a two-year zero-fare pilot system at a city council work session Tuesday. Evaluating the "feasibility and funding sources needed for a zero-fare transit system" is part of Iowa City’s Strategic Plan through 2028.

Ridership would increase anywhere from 20% to 60% through the proposed system, Darian Nagle-Gamm, director of transportation services told the city council, while it would help cut down on the city's carbon footprint.

“This is one of those rare, rare community projects that will truly address climate, equity, economic objectives, livability objectives,” she said. “It could really put Iowa City on the map… in all honesty, the ease with which people move throughout (a) community is a hallmark of a great community.”

Zero-fare transit system to support Iowa City’s climate goals, buses’ on-time performances

There will be no fee or pass required for people to come aboard Iowa City’s public transportation if this pilot system moves forward.

Iowa City bus fare is currently $1. The services are for adults 65 and older and qualifying people with disabilities, half-price for youth, and free for Medicare card holders and Johnson County SEATS card holders. The county’s SEATS transit system provides rides for senior citizens, people with disabilities or anyone else who may have difficulties traveling otherwise. Riders for paratransit operations pay $2.

The benefits of a zero-fare transit system include an increase in ridership and reduced conflicts at the farebox, increasing the likelihood of on-time arrivals. The initiative would also support the city’s climate action and livability goals while removing barriers for public transit use, Nagle-Gamm said.

“Zero fare first and foremost will remove a significant barrier for transit use,” she said. “And whether that barrier is the cost or the fact that you have to go somewhere, get a pass, figure out how to work the farebox. It’s something you have to do to get onto the bus.”

If Iowa City City Council proceeds with the proposed system, community members could expect to be fare-free by summer or fall of this year through 2025. Iowa City Transit and city council will revisit the pilot program annually, according to Nagle-Gamm.

“CAMBUS is already zero fare,” Councilor John Thomas said. “I think having both systems zero fare makes a much more coherent statement about Iowa City as a transit city.”

More: Johnson County decreased greenhouse gas emissions by 28 percent over a 10-year span, study reveals

A potential loss of public transportation fare revenue

Public transportation fare revenue made up 8% of Iowa City Transit’s funding resources in fiscal year 2022. The loss wouldn't damage the budget too significantly, Nagle-Gamm said.

“It’s not an insignificant portion but compared to all of our other funding sources, it is relatively small,” she said.

Had a zero-fare policy existed in FY 2022, $871,902 in fare revenue would have been lost.

Nearly half of the funding for Iowa City Transit in FY 2022 comes from property taxes through a transit levy.

Funding from the Federal Transit Administration’s urbanized area formula grants is important to Iowa City Transit’s income, Nagle-Gamm said. It’s that funding source that presents a few unknowns for Iowa City Transit after 2026. The Bipartisan Infrastructure Law authorized up to $108 billion to support federal public transportation programs, according to the FTA, though whether that funding will continue past 2026 or drop off is not known, Nagle-Gamm explained.

Federal funds are distributed by the Metropolitan Planning Organization of Johnson County to Iowa City Transit based upon a formula that considers multiple criteria, including fare revenue.

Iowa City Transit would lose $600,000 annually by moving to zero fare if there are no changes to the MPOJC’s formula, according to last year’s distributions. So, Iowa City would need to propose a change to the formula to ensure funding continues regardless of the change to zero fare, Nagle-Gamm said.

An increase in ridership could lead to more buses, staff

Should a zero-fare system result in an increase in ridership as expected, more staff and buses would be necessary. Paratransit demand is also expected to increase if fare is removed as well.

Nagle-Gamm said one of the challenges a zero-fare system could cause would be an increase in people riding the bus just for the ride, taking away space needed for riders with destinations in mind.

Iowa City Transit already has rules in place to address this. Riders can ride a route and back before they will be required to exit the bus.

Iowa City Council will have a resolution to pass the zero-fare pilot system on the agenda for the May 30 city council meeting or for meetings after, Mayor Bruce Teague said.

Paris Barraza covers entertainment, lifestyle and arts at the Iowa City Press-Citizen. Reach her at PBarraza@press-citizen.com or 319-519-9731. Follow her on Twitter @ParisBarraza.

This article originally appeared on Iowa City Press-Citizen: Iowa City Council considers piloting zero-fare transit system