Report shows FastCAT sales don't cover costs yet
Only 582 passes have been sold.
Dec. 04, 2012
A report released by the city manager and staff Sunday showed FastCAT Express sales are not covering the annual costs of the route.
"Our goal is to cover the costs," City Manager Mike Matthes said. "We'll do that however we can, but that doesn't happen right away."
Pass sales needed to support the cost of FastCAT total 5,441 per semester, but only 582 have been sold as of Monday night.
Similar transit systems in more established university collaborations in the Midwest usually charge $75 to $85 per semester. MU students pay $16.85 per semester, Mayor Bob McDavid said in a City Council meeting.
"That ($75 to $85) is the market rate," McDavid said. "We're undercutting that. For me, the goal is to have service that students want to pay the market rate."
Though the price is low, Columbia Transit cannot raise costs too quickly, Matthes said.
"If we were to charge what it really costs, it might scare the market away," Matthes said.
Currently, 5 percent of the total available market has FastCAT passes. Part of the the reason for the low market penetration is that students are used to driving cars to commute around Columbia, McDavid said.
"We face a cultural pressure here," he said. "This is a commuter campus — this is not a transit campus. Students pay money, $120 to $180 per year, to drive their cars to parking lots. We in America like our cars — that market penetration is something to follow, and it's a challenge. "
New construction will bring more students to the market, thus opening an opportunity for more customers, Matthes said.
"We're actively marketing to apartment complexes," Matthes said. "(With shuttle services) I think (apartment owners) don't realize how expensive it is to run a bus — they think they can beat the city. It's better for everyone to buy group passes. It's an amenity they can offer their residents."
By spreading information about the economic and environmental benefits of using FastCAT, City Council hopes to encourage more students to use the service. Right now, students pay nearly 10 times in parking costs than in transit, Matthes said.
"If we get the information out, there is a compelling reason to try transit," Matthes said. "We're hopeful about incremental growth."
Revenue for FastCAT comes from a combination of fares, pass sales, state grant money and advertising.
"We've got this crazy funding mechanism, so now how do we go from where we are to something more streamlined and that can last long-term?" Matthes said.
The idea of FastCAT came after city officials toured of transit systems in Ames, Iowa, Lawrence, Kan., and Champaign-Urbana, Ill., where bus services for students are provided with funding help from Iowa State University, the University of Kansas and the University of Illinois.
City Council hopes to improve FastCAT routes with the information from the report, Matthes said.
"This gives us a baseline," he said. "I'm very hopeful about the future success of FastCAT and the other routes."