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A proposal for a 15% fare increase, set to take effect from July 1, 2024, has been proposed by New Jersey Transit. This hike, the first in over six years, results from significant budget deficits and escalating operational costs.
The agency experienced a drastic reduction in farebox revenue due to the COVID-19 pandemic, with ridership levels still below pre-pandemic figures. Despite this, service performance enhancements and customer experience improvements have been maintained, such as restoring locomotive engineers and introducing new fare payment technologies.
Federal COVID relief funding, which was used to maintain these service levels, is projected to run out by Fiscal Year 2025. Preliminary budget estimates for the same year indicated a deficit of $119 million, leading to the necessity of this fare adjustment.
The fare increase proposal also includes annual system-wide increases of 3% starting from July 1, 2025. This move is intended to address mandatory non-discretionary cost escalations, including inflation, increased healthcare costs, contractual wage increments, and the operational costs of replacing abandoned private carrier bus routes.
New Jersey Transit has implemented various internal cost reductions and revenue enhancements to mitigate these issues. However, it claims these measures alone will not suffice to close the budget gap. The proposed fare increment, coupled with other internal efficiencies and revenue enhancements, would enable a fully funded Fiscal Year 2025 operating budget without reducing service levels.
A series of public hearings have been scheduled across the state in March to allow residents to provide feedback on the proposed fare hikes.