Fares for South Shore Line riders will increase an average of 10% on July 1 after a 4-1 vote by the Northern Indiana Commuter Transportation District board.
Gary Mayor Eddie Melton voted no Wednesday, explaining he had more questions about it before he could support it.
General Manager and President Michael Noland said the fare increase comes after the railroad has depleted its savings following the COVID-19 pandemic.
“We have not had a fare increase on this RR since 2018,” he said. Planned increases were skipped when the pandemic caused ridership to plummet.
As the railroad went to the Statehouse looking for additional funding, Noland said, state officials asked, “What are you doing with respect to self-help?”
The railroad has been conservative with its operating expenses and partnered with labor unions to find ways to reduce expenses and turn that into wages, he said. Still, a fare increase was needed.
Noland said the fare increase will bring in about $1.25 million to $1.5 million in additional revenue annually.
The fare increase is a big jump, at an average of 10%, but it’s been a long time coming. The consumer price increase has gone up “something like 35%” since 2018, he said.
Future fare increases are likely, perhaps 5% every other year beginning July 1, 2027, if inflation is around 2.5% per year, he said.
The railroad held five public hearings on the fare increases in April and May and solicited comments in writing and by email as well. “We received feedback. No one ever raises their hand and says please, please, please raise our fares,” Noland said.
The hearings in Porter, LaPorte and St. Joseph counties didn’t draw any attendees, Director of Strategic Planning and Grants Kelly Wenger said.
“We did not have a tremendous opposition to it,” Noland said.
In implementing the fare increase, the railroad is eliminating its buy-one-get-one-free promotion for monthly tickets.
“We heavily discount our monthly tickets,” which have historically been the railroad’s bread and butter, Noland said. “They’re still important riders to us,” but ridership trends are changing.
The pandemic taught companies that employees working at home could still be productive. Fewer people working in an office five days a week means fewer riders each day.
Now a lot of workers are in the office just two or three days a week, Noland said. They’re not necessarily working 9 to 5 in the office, either. Some just need to be there in time for a 9:30 a.m. staff meeting and can leave earlier, affecting rush hour demand for trains.
“The monthly ticket doesn’t make sense to them. They’re not getting the value out of it,” Noland said. Instead, they might opt for a 10-ride or 25-ride ticket. With the new fare structure, a 10-ride ticket is discounted 10% over the single-ride rate. It previously was discounted 5%. A 25-ride ticket now will be discounted 20%, rather than 10%.
The monthly ticket price is going up 10%. “We’re going to keep it. We’re not going to get rid of it,” Noland said. It will be up to riders to decide which ticket best serves their needs.
The railroad’s overall ticket sales have jumped 32.4% for the first four months of this year, compared to the same period last year. One-way tickets are up 33.2%, and monthly tickets are up just 8%, the lowest increase of any type of ticket. 25-ride ticket sales are up 11.6% and 10-ride tickets are up 11.7%.
The railroad offers reduced-price fares for senior citizens, active duty military, children under 13 and riders with disabilities. In addition, up to three children 13 and under can ride free when accompanied by a parent on weekend, holiday and off-peak weekday trains.
Wenger, whose many duties include compliance officer for Title 6, which affects low-income and minority communities, said they’re not adversely affected by the fare increase, based on 2024 ridership data.
Hudson Lake, the one community showing a disparate impact for the new fare structure, was based on insufficient response for that community. Only one person responded to the survey.
“Hudson Lake on a good day has four riders,” Noland said. The last passenger count was three, Wenger said. “We must have lost someone somewhere along the way.”
On-time performance has improved dramatically in the past year even as more trains are operating. Weekly trains reporting on-time performance increased 142% and trains arriving within 10 minutes of scheduled arrival time are up 85%.
Noland, looking at a chart on the performance increase, remarked, “I wish my stock portfolio looked like that.”
The board discussed potential impacts on ridership from external events. If the state decided to turn the Borman Expressway into a toll road, that “likely would drive, from an economic standpoint, ridership to the South Shore Line,” Noland said.
“That shifts their mentality: Maybe you know what, I’m going to take the train,” he said. When the Dan Ryan Expressway was under construction, ridership hit an all-time high.
Board chair Lyndsay Quist, who heads the Indiana Department of Transportation, said her agency did some preliminary work when the General Assembly talked this past session about tolling on the state’s expressways but hasn’t submitted a formal request to the federal government yet.
Doug Ross is a freelance reporter for the Post-Tribune.
