MBTA lays out how much it would cost to offer low-income fare

MBTA officials estimated Thursday they would need at least a year and about $5 million to get a widespread low-income fare option off the ground, plus tens of millions of dollars per year to cover its recurring costs.

The startup price — which would effectively mirror money Gov. Maura Healey proposed for the fare option in her state budget bill — would cover the process of staffing up with workers who would run the program, conducting necessary equity analyses, and crafting an online application.

In the first year, the T should expect a total price tag of about $28 million to $31 million due to lost fare revenue and operational costs, according to the figures MBTA staff presented at a board meeting Thursday.

Officials expect that enrollment in a low-income fare option would continue to grow and plateau after about five years, at which point the annual costs would settle at $52 million to $59 million.

"A program like this we would expect to induce some incremental demand," said MBTA Director of Fare Policy and Analytics Steven Povich. "When you make things cheaper, more people ride, which is a great value of the program."

Those projections assume the program would offer roughly half-priced fares to participants and limit eligibility to households at or below 200 percent of the federal poverty level, which is a threshold that many other state and federal benefit programs use.

The MBTA offers discounts through its Youth Pass program and to senior riders, but lower-income riders between the ages of 26 and 64 do not have any reduced-price options. About 60,000 riders fall into that age range with incomes below 200 percent of the federal poverty line, according to figures presented Thursday.

Healey called in her fiscal year 2024 budget for using $5 million on "one-time expenses" to explore a means-tested fare program at the T.