NJ Transit proposes fare hikes of up to 15%

NJ Transit announced it would seek to hike fares by up to 15% in its coming budgetary year and approve perpetual fare increases to account for revenue lost by pandemic declines in ridership the agency never fully recovered from.

The proposal to increase fares on buses, trains, and light rail cars by between 12.5% and 15% — with train tickets and interstate bus trips seeing the largest hikes — was met with immediate opposition from transit advocates.

“This proposed fare hike, the largest in recent years, places an unfair financial burden on the commuters and families who rely on NJ Transit for their daily transportation needs,” said Renae Reynolds, executive director of the Tri-State Transportation Campaign. “It is a clear indication that the current administration under Governor Murphy is failing to explore and implement alternative, sustainable funding strategies for our public transit system.”

The fare increases would be the first for NJ Transit since 2015, when ticket prices rose by an average of 9%.

The proposal also calls for NJ Transit to increase all fares by 3% annually beginning in July 2025.

The fare hikes are meant to address a fiscal cliff the agency faces in the fiscal year that begins July 1, when expenses will outstrip revenue by $106.6 million, according to new projections NJ Transit released alongside the fare hike proposal.

Based on NJ Transit fare revenue in the agency’s current budget, the higher fares would generate enough revenue to bridge that gap, but they would fall far short of meeting funding needs in the following year, when it’s expected to face a $917.8 million shortfall.

Advocates and some lawmakers, including Senate President Nicholas Scutari (D-Union), have called for the state to reinstate a corporate tax surcharge on business profits above $1 million to meet the agency’s funding needs, but lawmakers allowed that surcharge to expire at the end of 2023.

“New Jersey Transit is obviously in need of additional financial support, but continual fare increases will not fix the problem. We simply cannot rely on everyday commuters to carry the burden of NJ Transit’s billion dollar deficit, nor should we count on one-shot funding mechanisms to fill the hole,” Scutari said Wednesday.

Assembly Speaker Craig Coughlin (D-Middlesex) urged NJ Transit to consider how higher fares would impact commuters, adding legislators would explore options to fund transportation in the state.

Others urged the governor to reinstate the surcharge, which produced roughly $1 billion for the state annually but was a volatile source of revenue.

“Forcing riders to foot the bill and relying on farebox revenue to bridge the financial gap is not just inequitable, it’s bad policy,” said Alex Ambrose, a policy analyst for progressive think tank New Jersey Policy Perspective. “Policymakers chose corporations over New Jersey’s working families when they gave ultra-wealthy businesses like Amazon and Walmart a $1 billion tax cut. To prevent additional drastic fare hikes and service cuts, reinstating the Corporation Business Tax surcharge is the smart and practical way to fund NJ Transit.”

At present, NJ Transit is funded through a patchwork of fare revenue, state subsidies, diversions, and federal pandemic funds that are due to run dry partway through the coming fiscal year. The agency has no dedicated source of funding.

The agency will hold 10 in-person public hearings on the proposed hikes the week of Monday, March 4. Residents can also submit comments virtually using an online portal or by email. They can also mail comments to NJ Transit’s offices in Newark.