Implementing Regional Fare Systems

A payment system where multiple agencies within a geographic location offer riders a unified system of consistent fares and policies allows for easier convenience for riders and cost-savings in fare processing for the agencies.

Riders are able to transfer from one agency to another easily, without multiple transactions. Agencies are able to share costs related to reconciliation and processing.

Agencies looking to work together need a formation of a governance structure for the program to lead the cooperative establishment of policies, resolution of financial issues and clarification of operating issues. After talking to several people involved in the process of regional fare system development, it sounds like you also need a lot of patience and a sense of humor to maintain your sanity.

One CarD For All

"I think recognition back in the '90s was that everyone will benefit by having a fare system that makes it easier for people to use transit," says Sound Transit spokesman Geoff Patrick, "and that all agencies benefit if more riders are encouraged to get on board."

ORCA, which stands for "one regional card for all," is a simplified fare collection system using smart card technology for bus, rail and ferry in King, Kitsap, Snohomish and Pierce counties in the Central Puget Sound area of the state of Washington.

The agencies participating in this regional fare system are Sound Transit, Everett Transit, King County Metro, Kitsap Transit, Pierce Transit, Community Transit and the Washington State Ferries.

The E-purse is a stored value on the pass and is used like cash by riders. The fare is deducted from the E-purse on the ORCA card. Paper transfers are no longer needed as they are automatically calculated with the ORCA card.

"You have a card that is transferred from one bus to another. The value you paid for your first ticket is good for two hours," explains Patrick. "You buy a $2 ticket at one agency, you go get on another agency's bus or train, that $2 you paid on the first trip is applied to the second; you only pay more if the second trip costs more."

He adds, "The card tracks it all and provides a means for the program to allocate revenue from that trip to both agencies."

Of course it wasn't an easy task to accomplish, as ORCA Contract Administrator Candace Carlson explains.

"There's a long history here in the Central Puget Sound amongst the seven agencies of intersystem transfers — and really since the mid-1970s there have been various regional pass programs that have tried to knit the agencies together using a variety of technologies.

"They have a history of doing that and doing revenue sharing, so then two things happened that kind of pushed it into the ORCA world," she says.

The first is when Sound Transit was formed as a regional transit authority by the state legislature. Sound Transit made one of its founding principles that it would achieve a truly regional ticket pass for everyone, which was part of its enabling legislation.

"The other thing is that the technology, smart card technology, was really becoming a very viable alternative for doing the kind of complex fare programs that we have at the transaction base level," says Carlson.

"Those two things kind of came together and really pushed it to the next level," she states. "It's so hard to do the revenue reconciliation amongst the many agencies based on survey data. I don't want to say they failed, but they certainly were flawed." She reiterates, "The technology made it possible to support our regional revenue sharing."

Another complex issue is determining the governance structure. Carlson explains the three options.

"One is called a joint powers association, where you actually spin off a kind of governmental entity to operate the fare system. The other is a lead agency model, where one agency signs to contract with a vendor, really assumes most of the liability and the responsibility and the other agencies kind of follow along. And then the third option is the inter-local agreement option which is much more of a cooperative communal approach where the agencies are bound by an agreement to share costs and responsibilities.

"There's no easy way to do this," she asserts. "All these options have benefits and flaws to them. The agencies here decided to use the inter-local agreement option and have gone forward with that even though there are vast differences among them.

"There are city government, state government, county government, public transportation government, so that adds a layer of complexity to decision making and certainly to writing this agreement." She continues, "They all decided that they would cooperate and that they would all have equal votes, if you will. So all of these agencies are coming together as equals, even though one agency has 40 buses and another has 2,000."

"We took a phased approach to bringing it on board," says Patrick. "We started with a limited roll out and in January we added a major step of ending paper transfers between the systems and replacing those with ORCA and I would say that that's been an effective mechanism for rolling out a sweeping set of changes."

Expanding on the lessons learned, Carlson talks about how to schedule projects of this nature. "It takes so much more time than when it's a single agency doing something and I don't know who really knows how to get a handle on it."

She stresses, "The engineering part of it is not the biggest challenge, the biggest challenge is all of the business rules that have to be rationalized amongst the agencies because you want your customers to feel like they're just dealing with one system, not seven.

"All of your customer service rules, your accounting rules, they all need to be the same. So what you're really doing is a business process reengineering of seven agencies with really different practices. It takes a lot of time."

Carlson continues, "All of these business rules, in many ways become software, so they drive the system. When you're seven agencies like we are — that were very committed and very involved in every decision, we had 13 different teams of subject-matter experts making these decisions — it just takes time"

With a tired laugh she adds, "And yet someone on the outside will say, 'Why is this taking so long?'

"We're working 12-hour days and we?re tearing our hair out, there's not enough time, it's just very challenging to understand the scope of what you're doing and the time it takes."

She stresses, "I would say setting expectations would be a really big challenge for anyone doing it."

An integral component of the ORCA card is the business accounts. "Central to our image is our business account system," says Carlson. "That was very important to our design and distribution of the passes."

The business accounts provide employers an easy way to provide transportation benefits to employees or students. The program includes card management, including Web-based program management.

From the card to applications, they are constantly thinking of ways to improve ORCA and make it more convenient for its riders. "It's on a card today, but it could be on a keychain or a watch fob," Carlson shares as one possibility. She expands, "I think taking it to that next level to make transit applications a really convenient thing for people to load it on their phone or whatever.

"It's certainly an exciting development, not one we'll be getting up and ready today, but there are a number of ways to go with it."

Connected in the Bay

Carlson says the ORCA team has always worked closely with San Francisco on matters of regional fare collection because they have the same vendor, ERG Transit Systems out of Australia. They have the same vendor, but there are significant differences in how the operations are run. She emphasizes, "It was helpful to have someone, but they're really not the same models at all."

John Goodwin, public information officer for the Metropolitan Transportation Commission (MTC) in the Bay Area, says of Translink, "It was an effort to stitch together the roughly two dozen separate transit agencies that we have in our region. The idea was to knit those together into a seamless, passenger-friendly network so that a single card could be used to pay your fare on any of the agencies."

He adds, "We're not all the way there yet, but we?ve got most of it that accounts for the bulk of the ridership."

The engineering behind Translink, he says, was the same used in other successful instruments, such as the Octopus in Hong Kong. Motorola was awarded the prime contract, ERG Transit Systems was a subcontractor to Motorola. ERG's participation was purchased last year by Cubic.

Originally Trankslink was managed by the TransLink Consortium, which included the MTC and the major transit agencies in the Bay area. That changed last year as it was too challenging explains Goodwin. MTC is now managing the program itself.

The development has been funded by MTC through a combination of federal, state and regional funds, with federal funding having been provided through FTA 5307 Congestion Mitigation and Air Quality Improvement Program and Surface Transportation Program. Additional funding has been provided through State Transit Assistance, STP Exchange and Regional Measure 2 tolls.

"It was really conceived of as a means to make transit more convenient for the passenger, that was the primary purpose," Goodwin says of Translink. "With that said, we realized there were some operational benefits as well.

"If you have enough people using Translink, you speed the boarding process, you don't have people fumbling for cash, trying to fit a dollar bill into a bill acceptance device on a bus, and provided you have sufficient usage, it reduces the amount of cash that the transit operators have to handle themselves."

He reiterates, "There are really three different advantages, but the primary purpose of the Translink program is to make transit itself more convenient and therefore a more attractive option for people."

The card stores value in the form of e-cash (electronic cash). Cards and value can be purchased and added to online by phone, mail, online, retail outlets and at the agency offices. The e-cash does not expire and works just like cash on the vehicles of participating transit agencies.

A piece of advice Goodwin shares is to introduce the card as a means of carrying cash. "What we call e-cash," he says, "rather than a medium for loading discount tickets or monthly passes or employer transit benefits offered by employers.

"We do all of that and it all works, but it has taken a long time to get it all to work." So for speed and ease of launch, he suggests fewer possible fare instruments, just start with e-cash and you will probably get off to a very quick and a very successful start he says.

The message they've been sending out is that what ever the rider is getting from the transit agency now, it's available on Translink. "That's a simple message," Goodwin says. "I don't think we would ever go down the road of trying to communicate the hundreds of possible combinations going from San Fran to Muni to BART; too many possibilities." He adds with a laugh, "We have an app for that.

"The agencies already had many, many different kinds of fare instruments; they had 31-day passes, discounted high-value tickets on the BART system. Our system was designed to try and take in every single one of these combinations and then the business rules had to be written so that every possible fare combination could be incorporated.

"We had not only 26 different agencies, but we had literally hundreds of different fare combinations."

He stresses, "No. 1, try not to do it with two dozen or more operators."

The real marketing of Translink if scheduled to get underway this summer, Goodwin says. And it will also be getting a name change. "When the real aggressive marketing push begins in June it will be done with a new name. That moniker is Clipper, to evoke the historic era of the clipper ships and it's attached to the California Gold Rush days, and also designed to eliminate any confusion between TransLink the transit operator in Vancouver. "It's very prominent in our conscience now and it was in the fall of '09 in the lead up, up to the games."

Finding humor in the stress of making Translink come to fruition he adds, "My advice for other agencies making a move to smart card is 1. Try to do it in a region that doesn't have so many transit agencies." With a laugh he adds, "My deepest sympathies would go out to anyone trying to implement a smart card program incorporating more agencies than we have."