Agenda of Public Transport Committee - Tuesday, 19 November 2024

Item No.	Subject of each matter to be considered	Reason for passing this resolution in relation to each matter	Grounds under Section 48(1) for the passing of this resolution	When the item can be released into the public
10.1	Public Excluded Public Transport Committee Minutes - 24 September 2024	As noted in the relevant Minutes.	As noted in the relevant Minutes.	To remain in public excluded.
10.2	Public Excluded Tauranga Public Transport Joint Committee Minutes - 4 June 2024	As noted in the relevant Minutes.	As noted in the relevant Minutes.	To remain in public excluded.

Public Transport Committee Minutes

24 September 2024

Public Transport Committee

Open Minutes

Commencing: Tuesday 24 September 2024, 9:30 am

Venue: Council Chambers, Regional House, 1 Elizabeth Street, Tauranga and via Zoom (Audio-visual meeting)

Chairperson: Cr Andrew von Dadelszen – Bay of Plenty Regional Council Toi Moana (BOPRC)

Deputy Chairperson: Cr Lyall Thurston - BOPRC

Members: Cr Jane Nees - BOPRC

Cr Paula Thompson – BOPRC (via Zoom)

Cr Malcolm Campbell – BOPRC

Cr Andrew Iles – Whakatāne District Council (WDC)

Cr Gavin Dennis (Alternate) – WDC

Mayor James Denyer – Western Bay of Plenty District Council (WBOPDC)

Deputy Mayor John Scrimgeour (Alternate) – WBOPDC (via Zoom)

Cr Glen Crowther – Tauranga City Council (TCC)

Cr Rod Taylor – TCC

Cr Rick Curach (Alternate) – TCC

Cr Conan O'Brien – Rotorua Lakes Council (RLC)

Mayor Tania Tapsell (Alternate) – RLC (via Zoom)

In Attendance: BOPRC Councillors: Cr Ron Scott; Cr McDonald (via Zoom)

BOPRC Staff: Oliver Haycock – Director, Public Transport; Andrew Williams – Manager, Transport Planning; Ange Foster – Communications and Engagement Manager; Prue Sisam – Communications Operations Team Leader; Katri Harmoinen – Transport Planner; Bron Healey – Principal Advisor, Transport; Matthew Kilpatrick – Senior Transport Planner; Steve Groom – Governance Manager; Claudia Cameron – Committee Advisor

Apologies: Susan Collins – NZ Transport Agency Waka Kotahi (NZTA); Garry Maloney (Alternate) – NZTA and Cr Ken Shirley – BOPRC

Chair’s Statement

The Chair reminded those present that this meeting was being livestreamed and recorded and that the recording would be made available on the Bay of Plenty Regional Council website following the meeting: Public Transport Committee Meeting - 24 September 2024 (youtube.com)

1. Apologies

Resolved

That the Public Transport Committee:

1 Accepts the apologies from Susan Collins - NZTA, Garry Maloney – NZTA (alternate) and Cr Ken Shirley - BOPRC tendered at the meeting.

Thurston/Crowther

CARRIED

2. Declaration of Conflicts of Interest

None declared.

3. Minutes

Minutes to be Confirmed

3.1

Public Transport Committee Minutes - 12 June 2024

Resolved

That the Public Transport Committee:

1 Confirms the Public Transport Committee Minutes - 12 June 2024 as a true and correct record.

Campbell/Nees

CARRIED

Minutes to be Received

3.2

Tauranga Public Transport Joint Committee Minutes - 4 June 2024

Resolved

That the Public Transport Committee:

1 Receives the minutes, Tauranga Public Transport Joint Committee Minutes - 4 June 2024.

Crowther/von Dadelszen

CARRIED

4. Presentations

4.1

Public Transport Tuawhā Arotake Q4, 2023/24 Performance Monitoring Report

Presentation: Public Transport Tuawhā Arotake Q4: Objective ID A4775998

Presented by: Oliver Haycock – Director, Public Transport

Key Points:

· Included the full financial performance for the year

· More services were operating after the prolonged recovery from the impacts of the COVID-19 pandemic and the driver shortage

· There had been some minor changes to the network over the past 12 months to increase efficiency

· Anecdotal feedback from communities indicated that increased living costs, CBD parking charges and fuel costs encouraged public transport use

· The overall patronage figures did not include on-demand patronage figures

· There had been an increase in Total Mobility and concessions trips compared to the previous financial year

· Staff had fielded over 5000 inquiries in the last quarter, with only 1.1% remaining outstanding

· Missed trips occurred in 1% of total trips and were often caused by congestion; there was optimism that projects to increase corridor efficiency would reduce this

· Expenditure had been lower than forecasted, partly due to a reduction in consultancy costs. Overspend due to inflationary pressures had been managed within budget.

In Response to Questions:

· Regarding the on-demand service:

o Algorithm adjustments were taking place to increase on-demand passenger efficiency

o Smaller buses were able to access the heart of residential areas

o Figures in the report were only for the previous financial year, however use of the service continued to grow

o Data was being collected and trends analysed to understand the future of the service following the trial period

o A progress report outlining the first six months of the trial would be presented to the Public Transport Committee

o At the trial’s conclusion a paper would be taken to Regional Council outlining future options

· The low patronage of the Katikati-Tauranga service was potentially due to service unreliability which was a result of congestion

· Noted that the apparent increased capex budget was due to a budgeted software development project being delayed.

Key Points - Members:

· Other councils had operated successful on-demand trials, however had not continued the service due to financial viability

· Assurance was sought that analysis of the BOPRC trial would be benchmarked against other Councils’ experiences.

Resolved

That the Public Transport Committee:

1 Receives the report, Public Transport Tuawhā Arotake Q4, 2023/24 Performance Monitoring Report.

von Dadelszen/Nees

CARRIED

5. Verbal Updates

5.1

Waka Eastern Bay Update

Tabled Document 1 - Waka Eastern Bay Update: Objective ID A4780006

Presented by: Cr Andrew Iles - Whakatāne District Council

Key Points:

· Trips had increased over the past year from 27 per month to over 300 per month

· There were now four vehicles in operation with two part-time paid drivers supported by volunteer drivers

· 166 registered users, many of whom had some form of disability

· Listed as a Total Mobility provider and had completed 18 trips to date; there were 13 users with Total Mobility cards and four Total Mobility Drivers.

In Response to Questions - Staff:

· Current bus contracts in the Eastern Bay were committed to operate until 2026, an on-demand trial could be considered via the 2025-2026 Annual Plan process.

Key Points - Members:

· Members of the community had expressed interest in a similar service in Te Puke.

6. Reports

6.1

Chairperson's Report

Presentation: Baybus Website Presentation: Objective ID A4775343

Presented by: Oliver Haycock – Director, Public Transport; Ange Foster - Communications and Engagement Manager and Prue Sisam – Communications Operations Team Leader

Key Points:

· There were significant funding constraints from the National Land Transport Fund (NLTF). Initial analysis indicated the current levels of core services could be provided, but the programme of proposed improvements may require reconsideration and other funding options investigated

· The only programme which had secured Low Cost Low Risk (LCLR) funding was for the continuation of the on-demand trial

· Noted the projects to improve corridor efficiency would benefit the public transport network, however Cameron Road Stage 2 had not received funding

· The updated Baybus website was introduced and a demonstration provided:

o Responsive design, focus on user experience, worked effectively on all devices

o The journey planner was on-site and used location tracker

o Accurate live and timetabled route data; all available stops could be added to the timetable

o Clearer live tracking icon and better indication of service alerts

o Included accessible transport information with a comprehensive fare table and information.

In Response to Questions:

· Push alerts required users to log in; they could be made available in the future

· Although not an app, it was a mobile friendly webpage which could be saved on the user’s phone home screen

· An understanding of the National Ticketing Solution (NTS) technology integration was required prior to a decision being made regarding replacement of the Transit App

· Although Government/NZTA farebox recovery operational policy was in development, the Government Policy Statement (GPS) on land transport 2024 had signalled the need to increase farebox recovery. Guidance regarding targets was yet to be received, although would likely be similar to the 2018 farebox recovery level. Staff had commenced a regional fares review in anticipation of the required changes.

10.41 am – Cr Malcolm Campbell withdrew from the meeting.

Key Points - Members:

· Noted the Regional Transport Committee roundtables due to take place in Rotorua and the Eastern Bay to discuss the NLTF funding

· Consultation with businesses impacted by the proposed Cameron Road bus lanes was to be undertaken by TCC. Noted an error in the Chair’s Report, a report would be taken to TCC in February 2025 regarding this matter. Members requested the report be completed earlier if the decision was time sensitive

· As farebox recovery included other sources of revenue, emphasised the need to look at all potential sources of income, e.g. advertising on buses.

Resolved

That the Public Transport Committee:

1 Receives the report, Chairperson's Report.

von Dadelszen/Thurston

CARRIED

10.43 am – Cr Malcolm Campbell entered the meeting.

Decisions Required

6.2

Membership Update

Presented by: Matthew Kilpatrick – Senior Transport Planner and Steve Groom Governance Manager

Resolved

That the Public Transport Committee:

1 Receives the report, Membership Update;

2 Notes the new members of the Public Transport Committee representing Tauranga City Council as Cr Glen Crowther, Cr Rod Taylor and Cr Rick Curach (alternate);

3 Notes the new alternate member for NZ Transport Agency Waka Kotahi as Garry Maloney.

Thurston/Denyer

CARRIED

10.45 am – The meeting adjourned.

11.01 am – The meeting reconvened.

6.3

Bay of Plenty Regional Tertiary Contracts

Presented by: Oliver Haycock – Director, Public Transport

Key Points:

· Current tertiary contract funding was underpinned by a 51% contribution from NZTA via Low Cost Low Risk (LCLR) funding with the remainder coming from BOPRC and two tertiary institutes

· The NLTF had not provided for the continuation of funding leaving a funding gap of $280,000 per annum. Additionally neither tertiary institute had committed to the continuation of their portion of the funding

· Service patronage was low

· Staff were recommending the service cease at the end of the 2024 calendar year which required a decision by BOPRC as there were budgetary implications.

In Response to Questions:

· There was an option for tertiary institutions to provide their own shuttle service

· The projected funding requirement included assumed student contribution through the introduction of fares

· Extending the Katikati to Tauranga service to Toi Ohomai was not possible due to timetabling constraints and would therefore require an additional vehicles.

Key Points - Members:

· Acknowledged the need for fiscal responsibility

· Expressed regret at the potential loss of access for users and highlighted the importance of providing communities access to tertiary education

· Sought assurance that staff would endeavour to facilitate a replacement service through other organisations such as Waka Eastern Bay, Intercity and iwi

· Questioned whether the potential budget savings from the discontinuation of this service could be re-invested to improve other services

· Emphasised the need for a thorough communications programme

· Highlighted the need for a Western Bay network review, particularly regarding service times, to ensure convenience of alternative services.

Resolved

That the Public Transport Committee:

1 Receives the report, Bay of Plenty Regional Tertiary Contracts;

2 Endorses the recommendation that the Bay of Plenty Regional Tertiary Commuter services cease at the end of 2024;

3 Directs staff to follow up with Iwi and Tertiary Providers to investigate potential alternative options for all regional Tertiary Commuter services and to investigate potential changes to the Katikati commuter service to Tauranga.

That the Public Transport Committee recommends that the Regional Council:

4 Receives the report, Bay of Plenty Regional Tertiary Contracts;

5 Approves the recommendation that the Bay of Plenty Regional Tertiary Commuter services cease at the end of 2024.

Thurston/Nees

CARRIED

Minute Note:

The wording of resolution 3 was amended for improved clarity at a later point in the meeting. This was resolved by over 75% of voting members by a show of hands.

3 Directs staff to follow up with Iwi and Tertiary Providers to investigate potential alternative options for all Regional Tertiary Commuter Services and to investigate potential changes to the route 80, Katikati express service to Tauranga, as a mitigation for the withdrawal of the tertiary service.

Thurston/Nees

CARRIED

11.18 am – Mayor Tania Tapsell withdrew from the meeting.

Information Only

6.4

Bus User and Non-User Surveys

Presented by: Bron Healey – Principal Advisor, Transport

Key Points:

· Reported on key metrics to measure user experience and satisfaction, this allowed service adjustments to be made accordingly

· Trends were able to be measured over time

· Outlined points of note from the survey results:

o Accuracy of the Transit App

o Awareness of the Bee Card

o Barriers to use

· Noted that the non-user survey had not been funded for continuation as it was not an effective way to gather meaningful data.

In Response to Questions:

· Non-User Survey:

o Acknowledged that the demographics, particularly in rural Western Bay, were not representative

o The external agency who conducted the research used census data and cold-calling to reach participants, efforts were made to build a representative pool of participants but it was a challenge to get responses

o There was limited analysis of respondents proximity to a bus service

o Targeted engagement on a project by project basis was considered a more effective way to gather opinions of non-users going forward

· As Tauranga has more services than Rotorua there had been a larger discrepancy in levels of service during the COVID-19 pandemic and driver shortages; this may explain why Rotorua’s customer satisfaction levels had remained more stable than Tauranga’s.

Key Points - Members:

· Noted that there was limited bus service in rural Western Bay which may have impacted results

· Emphasised the importance of gathering data from non-users as they were potential customers

· Assumed that the environmental benefits of taking the bus would have been better reflected in the opinions of survey participants

· Highlighted the low number of youth/young adults who considered the bus good value for money, although considered this may be reflective of reliability. Emphasised the need to carefully adjust fares to maintain and increase patronage.

Resolved

That the Public Transport Committee:

1 Receives the report, Bus User and Non-User Surveys.

Crowther/Iles

CARRIED

6.5

Regional Public Transport Plan Action Plan - Implementation and Monitoring Report

Presented by: Katri Harmoinen – Transport Planner and Andrew Williams – Manager, Transport Planning

Key Points:

· The first progress report of the Regional Public Transport Plan (RPTP) following the development and adoption of the RPTP Action Plan

· Reported on the implementation of actions and monitoring of key performance indicators (KPI)

· Noted the National Land Transport Programme announcement and the impact the reduced NLTF funding would have, particularly on business cases

· Next steps:

o Continued improvement of the RPTP implementation and monitoring

o Build on any knowledge or data gaps

o Provide reports to the Public Transport Committee biannually.

In Response to Questions:

· KPI 4: Tauranga dwellings within 500m of a frequent service (every 15 minutes) bus stop included Tauranga and Western Bay but excluded industrial and commercial addresses

· Actions were able to be adjusted at the review of the RPTP to take into consideration the changing direction from central government

· Highlighted the importance of the Transport System Partnership (TPS) and collaboration with partners when looking at future project delivery with the available funding

· Staff were awaiting further direction from central government regarding future bus decarbonisation directives. The mandate from the previous government still existed: no purchase of new vehicles powered purely by fossil fuels beyond 2025 and the entire fleet decarbonised by 2035.

Key Points - Members:

· Expressed concern regarding mode shift and carbon reduction targets, and noted a missed opportunity regarding public transport and land use integration.

Resolved

That the Public Transport Committee:

1 Receives the report, Regional Public Transport Plan Action Plan - Implementation and Monitoring Report.

von Dadelszen/Thurston

CARRIED

7. Public Excluded Section

Resolved

Resolution to exclude the public

1 Excludes the public from the following parts of the proceedings of this meeting as set out below:

The general subject of each matter to be considered while the public is excluded, the reason for passing this resolution in relation to each matter, and the specific grounds under section 48(1) of the Local Government Official Information and Meetings Act 1987 for the passing of this resolution are as follows:

Item No.	Subject of each matter to be considered	Reason for passing this resolution in relation to each matter	Grounds under Section 48(1) for the passing of this resolution	When the item can be released into the public
7.1	Public Excluded Public Transport Committee Minutes - 12 June 2024	As noted in the relevant Minutes.	As noted in the relevant Minutes.	To remain in public excluded.
7.2	Public Excluded Tauranga Public Transport Joint Committee Minutes - 4 June 2024	As noted in the relevant Minutes.	As noted in the relevant Minutes.	To remain in public excluded.

Thurston/Nees

CARRIED

12.09 pm – the meeting closed.

Confirmed

Cr Andrew von Dadelszen

Chairperson, Public Transport Committee



Report To:	Public Transport Committee
Meeting Date:	19 November 2024
Report Authoriser:	Oliver Haycock

Chairperson's Report

Executive Summary

This report highlights matters of interest that the Committee Chair considers to be relevant to the business of the Public Transport Committee.

This report provides updates on:

· Emerging Issue - temporary status of bike racks on buses

· Tertiary Services cessation update

· School Services 2025

· Security update

Recommendations

That the Public Transport Committee:

1 Receives the report, Chairperson's Report.

Purpose

The purpose of this report is to provide PTC members with a summary of topical matters of potential interest.

Matters of Potential Interest

Temporary Disablement of Bike Racks on Public Transport Buses

On Wednesday, 6 November, Staff were contacted by bus operators, informing them that the Bus & Coach Association had reached the conclusion that a recent bulletin issued by NZTA may make buses fitted with front mounted bike racks Certificate of Fitness non-compliant with immediate effect, due to the potential obstruction of the vehicle headlights when the rack is deployed and carrying bikes.

Staff quickly engaged with other public transport agencies to develop a position which ensured a consistent response across the regions and minimise the impact on customers.

The issue is complex and requires clarification from NZTA and further engagement with the bus industry. Given the time this may take, staff felt that it was appropriate that operators temporarily disable bike racks and prioritise safety until the necessary clarification can be provided, and remedial measures can be implemented if required.

On 6 November, staff issued a position statement to operators, noting that Council’s focus is on the safety and wellbeing of passengers and frontline public transport staff, and that:

· all bike racks on buses on the Bay of Plenty public transport network be temporarily disabled from 11.59pm Friday 8 November until further notice is given

· no bike racks should be physically removed from buses unless express authorisation is given by BOPRC

· members of the public will be unable to use bike racks on buses until this matter is resolved

· operators can choose to temporarily disable bike racks in any manner that does not compromise the future use and integrity of the bike racks

· BOPRC will be communicating with the public on this matter. It is the operator’s responsibility to ensure front-line staff are appropriately briefed and trained on this matter

· BOPRC will be working proactively with our Regional Council partners, operators, the Bus and Coach Association and NZTA to resolve this matter as soon as possible.

A media release was sent out at 2:00pm on Thursday 7 November 2024, advising that Bay of Plenty Regional Council had announced a temporary stop to bike rack use on all public transport buses in the region, effective from Saturday 9 November.

A comprehensive communications plan has been enacted across several channels (including the Baybus website, Transit App, Facebook and on-bus messaging) to ensure stakeholders understand the impact on our network.

Staff will continue to actively monitor the situation and respond appropriately as it develops.

Regional Tertiary Commuter Services Cessation

The Public Transport Committee meeting held on 24 September 2024 recommended to Council that the Bay of Plenty Regional Tertiary Commuter services cease at the end of 2024. Additionally, the Committee directed staff to follow up with Iwi and Tertiary Providers to:

· investigate potential alternative options for all Regional Tertiary Commuter Services, and

· to investigate potential changes to the route 80, Katikati express service to Tauranga, as a mitigation for the withdrawal of the tertiary service.

At a meeting held on 23October 2024, Regional Council endorsed the recommendation from the Public Transport Committee that the Bay of Plenty Regional Tertiary Commuter services cease at the end of 2024.

Updates on the directives from the Public Transport Committee meeting on 24 September follow below.

Alternative options for Route 80

Staff have been working with the operator of route 80 to identify any opportunities to adjust the timetable to mitigate the withdrawal of route 103.

Adjusting the times of the morning services was explored to offer a more convenient departure time from Katikati. However, due to this route currently being operated by the same vehicle all day, this was found to have significant ramifications on the timing of other trips.

At the time of writing Staff await costs from the operator to add an extra inbound trip on Route 80 to replace the current Route 103 morning trip but anticipate that this proposal will not be deliverable within existing budgets, so will be unable to be progressed.

Engagement with the Murupara Community

Staff from the Rates and Transport Teams are collaborating with the Murupara Library and Service Centre to co-ordinate a drop-in information session. This session will allow residents to discuss their Bay of Plenty Regional Council rates and address any transport-related queries.

Transport Team staff will continue to explore potential alternative transport options following Council’s decision to cease the Tertiary Community bus services. They will also engage with community members and iwi in this regard.

Two Regional Councillors have indicated their attendance at the Murupara Community Board hui on 10th February 2025 to discuss Bay of Plenty Regional Council rates and the region’s transport. Staff will support as needed.

It is likely that no changes will be made to the remaining Murupara service (route 15/15a) due to difficulties around timetabling.

Stakeholder Communications

Staff have developed a comprehensive communications plan including a media statement issued 23 October 2024, and the following channels:

o Baybus website notification

o electronic direct messaging, including Transit App

o mailout to Beecard account owners

o In-bus posters, Facebook & newspaper notices

Where possible, the communications identify alternative bus options.

Additionally, communications Staff have engaged with the Tertiary to ensure that there is strong alignment with their communications activities.

Bus Operators

Staff have updated operators with the Council decision and confirmed that the services will end on 20 December 2024, ahead of contract expiry on 30 December 2024.

School Services 2025

A letter was sent to Tauranga and Te Puke schools 18 October 2024 to notify them that the existing level of school services would continue into 2025, but that Council is not able to add any new school routes or additional capacity in 2025.

As previous noted, Staff will conduct a full review of Tauranga and Te Puke school bus services in 2025 and will seek input from schools. The review will consider whether the Tauranga school transport offering appropriately balances the varying needs of students, with the financial sustainability of the public transport system.

Security

There have been several recent incidents of violence on buses around the country. In response to this issue, the Minister of Transport through NZTA Waka Kotahi is now collecting data on incidents through the normal monthly reporting cycle.

The current Tauranga security contract is due to end on 19 December 2024. For the last six months security guards have been deployed at the Durham Street interchange during the hours of 08:00-10:00 and 15:00-21:00 Monday to Friday only.

Staff investigations have shown that incidents reported by bus operators, public feedback and the Tauranga Transport Operations Centre appear to be trending upwards. Staff will continue to monitor the situation, especially for trends or correlations.



Report To:	Public Transport Committee
Meeting Date:	19 November 2024
Report Writer:	Niki Carling, Team Leader, Transport Planning
Report Authoriser:	Oliver Haycock, Director, Public Transport
Purpose:	This paper is to support decision making by the Committee on the proposed fares system, which will then be recommended to Regional Council for adoption at its meeting on 11 December 2024.

Regional Fares Review 2024 - Fare System Decisions

Executive Summary

The current Bay of Plenty public transport fares system has evolved over time into a system that:

• Is difficult to understand

• Does not provide consistency or balance across the region

• Generates low revenue.

Central government has directed Public Transport Authorities to increase the public transport revenue they generate from private share; the primary source of private share revenue in the Bay of Plenty is fares.

The timing of the review has been set to ensure that the parameters of the new fare system will be ready for National Ticketing Solution (NTS) configuration by the end of the 2024 calendar year, to feed into the NTS implementation process for the region, which will happen between January and August 2025.

Further to guidance received from workshops with both the Regional Council and the Public Transport Committee, initial fares modelling work was undertaken by staff and discussed with the Committee at a workshop on 1 November 2024.

Direction given by the Committee at this workshop has been used to refine this modelling, the results of which are being presented to the elected members at the Public Transport Committee meeting on 19 November 2024.

Recommendations

That the Public Transport Committee:

1 Receives the report, Regional Fares Review 2024 - Fare System Decisions;

2 Approves the fare system parameters – fare structure, concessions, products and adult base fare - as presented by staff;

3 Recommends that Regional Council adopt the recommended fare system at its 11 December 2024 meeting.

1. Introduction

The current Bay of Plenty public transport fares system has evolved incrementally over time because of several largely disconnected decisions at both regional and central government levels. The result is a system that:

· Is difficult to understand;

· Does not provide consistency or balance across the region; and

· Generates low revenue.

Critically, the region’s private share revenue, including farebox recovery, will need to increase to meet central government’s directive for Public Transport Authorities (PTAs) to increase the public transport revenue they generate from private share.

Work on the fares review to-date has included workshops with both the Regional Council and the Public Transport Committee. Direction given by elected members at these workshops has been used to undertake modelling of potential fare systems for the region. In summary, this direction has been:

Meeting/Workshop	Component	Direction provided
Regional Council workshop - 5 Sept	Fares principles	Principles ratings: · Simple – High · Customer-focused – High · Equitable – Medium · Incentivised – High · Transport system efficiency – Medium · Social equity – Medium · Financial sustainability – Medium-High
	Potential for charging children/youth	Consider charging children/youth
	Fare cap for Total Mobility	Staff proposed separate piece of work to review TM
	Level of community engagement	Community engagement to be at ‘information’ end of community engagement spectrum
PTC workshop - 24 September	Concessions
	‘Time of travel’ fares	Consider fares based on ‘time of travel’ e.g. peak/ off-peak, weekend fares
	Capped fares	Consider fare capping

At a second Public Transport Committee workshop on 1 November 2024, elected members were shown a preferred fare structure and key assumptions for a proposed new fare system, and modelling of the impact these would have, including on the farebox recovery ratio (FRR).

Staff sought elected members’ input on the preferred fare structure and key assumptions. They also identified and sought input on a set of additional considerations that could be used to refine modelling for the Committee meeting on 19 November 2024.

1.1 Legislative Framework

The Regional Public Transport Plan 2022-2032 (RPTP) adopted in 2022 is the key statutory document for public transport planning and investment in the region, required under the Land Transport Management Act 2003 (LTMA).

‘An equitable fare and pricing system that attracts new customers and rewards frequent use’ is an objective of the RPTP. The primary RPTP action to achieve this objective is: ‘Undertake a comprehensive region-wide fare review to give effect to the RPTP fares and pricing policies.’

1.2 Alignment with Strategic Framework

Future ready communities	Goal 6 We will empower communities to make sustainable choices and transition towards a low emissions economy.
Connected and enabled communities	Goal 8 Communities are connected through an effective transport system, land use and urban design that improves wellbeing, livability and environmental outcomes.

The performance of the region’s public transport services is continually monitored and reported through KPIs in the Arotake quarterly reports, found on the Council’s website, here.

The new NZTA Development Guidelines for Regional Public Transport Plans 2024 states that ‘PTAs must include a fares and pricing policy in their regional public transport plan that:

· Specifies the method for setting and reviewing fares, with fare pricing reviews to occur annually and fare structure reviews at least every six years.’

This is reflected in RPTP Policy 7.6: Reviewing fares: Conduct regular fare reviews which take into account inflation and changes in operating costs, while ensuring consistency with the fare principles in Policy 7.1.

Fares in the Bay of Plenty have not been reviewed regularly over the last few years. However, the current fares review will include a process for future review and adjustment of fares as part of Annual and Long Term Plan processes.

1.3 Community Well-beings Assessment

Dominant Well-Beings Affected

þ Environmental

Low - Positive

¨ Cultural

þ Social

Low - Negative

þ Economic

The two well-beings most affected by fare changes that may result from this fares review work are environmental wellbeing and social wellbeing.

Environmental: The use of public transport instead of individual cars is generally considered to benefit the environment, primarily through reduced emissions. Whilst the potential introduction of higher fares may result in a degree of patronage reduction, it is anticipated that there will also be increased patronage through the introduction of fare products that encourage more frequent use of public transport as well as organic growth resulting from population increase.

Social: Staff acknowledge that fare pricing increases, including the potential removal of free fares for children/young people, will likely have a negative social effect, especially for those in lower socio-economic households. However, concessions will still be available to those with access to a Community Services Card, or a SuperGold card and those approved for an accessibility concession.

2. Initial Fares Modelling

Fares modelling was undertaken using the direction given in the earlier workshops and a set of informed assumptions.

Modelling was undertaken for three base adult fare scenarios - $3.50, $3.70 and $4.00 - to produce projected revenue and patronage levels. Public transport point elasticities of demand were used from best practice domestic and international modelling and generally adopted principles of demand forecasting.

2.1 Assumptions

The assumptions made in the fares modelling work were:

Component	Assumption
Base adult fare (with prepaid card)	$3.70 - consistent for the whole region
Standard concession fare	50% off base adult fare
Concessions	Remove Senior concession Remove Tertiary concession Use national conditions for Supergold concession, ie. free travel between 9.00am and 3.00pm and after 6.30pm from Monday to Friday, and all day on weekends and public holidays
Child/Young person	Introduce peak charges for children/young people at 50% of adult fare
Time of travel	50% discount for off-peak travel
Capping	Revenue based caps Day Cap 2-3 trips Week Cap 7-8 trips

2.2 Fare structure base model

Fare structures establish rules and methods used to calculate the fare charged for a journey. Fare structures are generally either classified as:

· Flat fares

· Distance-based fares, or

· Zone-based fares.

A simple multi-criteria analysis of these fare structure options against the fares principles ratings provided by the Regional Council resulted in staff discounting further consideration of a distance-based fare structure. Flat and zone-based fare structures were used as the base for the fares modelling work.

2.3 Additional considerations

Through the initial modelling work, staff identified and sought feedback on a set of additional considerations, which could be used to refine the modelling for the Committee meeting on 19 November 2024.

· Organic growth in demand of between 3 and 6% over two years will add a further 0.4% to 0.8% to FRR;

· Loss prevention measures could add an additional 0.1%; and

· Increasing the Adult fare to $5 and Child fare to $2.50 for the On Demand trial could increase FRR in the order of 2% for the trial.

Staff also tested the appetite of the Committee to go ‘cashless’ with the launch of the National Ticketing Solution.

2.4 Initial fares modelling results

Analysis shows that in the Bay of Plenty, around 95% of patronage relates to travel within a single ‘urban zone’. The remaining ~5% of travel occurs in the outer zones and its impact on FRR is relatively low, providing a 0.1% increase. However, there are additional benefits to the use of a zonal structure in creating a fare system that is easy to understand across the region and can be readily adapted to include future intraregional routes.

The first phase of modelling gave the results in the table below. The “Base” scenario presents absolute numbers representing the current state. All other scenarios are presented as an incremental impact on the “Base”. For each scenario, an impact range is presented, which is governed by “high” and “low” elasticity^{^[1]} bounds.

In terms of context for these initial modelling results, All PTAs have been directed to work with the New Zealand Transport Agency – Waka Kotahi (NZTA) to identify and agree staged targets for private share revenue, which in the Bay of Plenty is currently mainly made up of farebox revenue. The early indication from NZTA is that the private share targets will be set at 2018/19 FRR levels (ie. 24% for the Bay of Plenty), with a stepped increase over 3 years.^{^[2]}

The initial modelling results above show significant inroads towards achieving this indicative target, by progressively applying the fares modelling assumptions identified in section 2.1.

It should be noted that the proposed formula to calculate “private share revenue” is likely to differ from the formula used to calculate the “farebox recovery ratio”. Once NZTA have completed their engagement with PTAs and confirmed the formula and targets, this updated approach will be adopted for future reporting.

3. Direction for Further Modelling

The Committee were generally in support of the fare structure, key assumptions and additional considerations presented by staff. The following additional work was requested by elected members and/or identified by staff towards the development of the next fare modelling iteration:

3.1 Zonal structure

· Look at reconfiguring the Tauranga urban zone to include Te Puna.

· Further work to recommend zonal fare increments.

For the initial modelling, staff assumed that the fare doubles at each successive zonal boundary. However, further work will be done to refine this by applying an incremental increase (z) for each zone, along the lines of x, x+z, x+2z, etc. It will also consider tailing off the increment for the outermost zones in the network.

3.2 Concessions/discounts

· Consider how a discount might be provided for families with multiple children (or could this be achieved by a lower cap applied to child concessions if possible under NTS).

3.3 Fare products

· Investigate feasibility of family passes under NTS.

3.4 On-Demand

· Fare structure changes should be applied to the On-Demand service, noting that there is a high likelihood that the trial will be deemed unsuccessful if the current farebox recovery is maintained.

· Targeted consultation with users should be conducted to test price sensitivity and proposed fare structure.

· Increasing the Adult fare to $5 and Child fare to $2.50 for the On- Demand trial could increase FRR in the order of 2%.

Given the proposed timeframes, there is no opportunity to include revised On-Demand fares as part of the introduction of the new fares system. On-Demand fares are being covered off in a separate report to this Committee Meeting – ‘Tauranga South On Demand Trial - Six Month Performance Report & Fare Pricing Considerations.’

3.5 Additional considerations

· Organic growth in demand of between 3 and 6% over two years will add a further 0.4% to 0.8% to FRR.

· Loss prevention measures could add an additional 0.1% to FRR.

In the main, feedback from the Committee members was that ‘going cashless’ should not happen in the early stages of the NTS rollout but should be considered in the medium-term.^{^[3]} Staff suggested that this could perhaps be introduced through a trial on a single route.

4. Further Modelling

The direction provided by the Committee and further work identified by staff has been used to undertake the second iteration of modelling, as summarised in the workshop presentation.

5. Future Fares and Pricing Reviews

In line with the NZTA requirements for fare structure and pricing reviews (identified in section 1.2), staff will be proposing to Regional Council that fare levels are reviewed annually, to feed into Council future planning processes.

However, in light of the work soon to commence with NZTA to determine targets for private share revenue staged over the next two years, the revenue impact of fare levels will over this period need close monitoring and possible further adjustment to help meet targets.

The timing of future fare structure reviews (both pricing and structure) will be subject to ongoing monitoring, consideration of alignment with RPTP, and central government direction, but will be at least every six years as required by NZTA.

The Regional Council may choose to delegate future fares consideration to the Public Transport Committee.

6. Considerations

6.1 Risks and Mitigations

Noted below are the biggest risks to the project:

Risk	Risk Level	Mitigating Actions
Timing – risk of not meeting deadlines for NTS configuration	High	· Contingency planning · Regular touchpoints with Governance · Support recommendations to Governance with comprehensive information and analysis to support efficient decision making. · Create and maintain momentum in process · Prioritise internal resources
Community – risk that the proposed options are not positively received or understood	High	· Develop a comprehensive stakeholder Communications and Engagement Plan · Clearly define the challenge that Council is facing (i.e. do nothing is not an option)
Funding - risk of not securing national funding if preferred option does not align with national policy direction	High	· Develop options that align with national direction · Keep NZTA engaged and informed throughout the review process
Private revenue share requirements – risk of NZTA/ Council not having confirmed targets in time to inform the fare review process	High	· Work closely with NZTA public transport partners to sort targets

6.2 Climate Change

The use of public transport instead of individual cars is inherently supportive of climate change mitigation, through reduced emissions. While the potential introduction of higher fare levels may result in a degree of patronage reduction and potential shift to car use, it is anticipated that there will also be increased patronage through the introduction of fare products that encourage more frequent use of public transport, as well as organic growth resulting from population increase, which will support climate change mitigation goals.

6.3 Implications for Māori

Potential fare pricing increases, including removing free fares for children/young people, will likely impact those in lower socio-economic households and those with larger families. However, concessions will still be available to those with access to a Community Services Card, or a SuperGold card and those approved for an accessibility concession.

Some of the region’s rural communities have a disproportionately higher population of Māori who might potentially be impacted by a zonal system when travelling longer distances to access urban centres. However, refined modelling to include zonal fare increments that tail off in the outer zones has identified some potential fare reductions for those travelling longer distances, especially in the eastern Bay of Plenty.

6.4 Community Engagement

INFORM

Whakamōhio

To provide affected communities with balanced and objective information to assist them in understanding the problems, alternatives and/or solutions.

The focus of community engagement on the fares review has been to inform the community about the work underway. In addition to newspaper advertising and social media, a Participate page has been created to inform and seek feedback on concessions and fare products eg, capping and time of travel discounts. Staff have also undertaken ‘light touch’, face-to-face engagement by attending existing events e.g. markets and have engaged with bus users at the Durham Street and Arawa Street (Rotorua) interchanges.

A summary of the feedback received to-date will be tabled at the meeting.

6.5 Financial Implications

There are no material unbudgeted financial implications and this fits within the allocated budget.

7. Next Steps

This work culminates with the parameters of the new fare system ready for National Ticketing Solution (NTS) configuration by the end of the 2024 calendar year. These will then feed into the NTS implementation process for the region.

In the context of the NTS implementation for the Bay of Plenty, the next steps are:



Report To:	Public Transport Committee
Meeting Date:	19 November 2024
Report Writer:	Andrew Williams, Manager, Transport Planning and Melissa Winters, Senior Network Planner
Report Authoriser:	Oliver Haycock, Director, Public Transport
Purpose:	To provide the six-month performance report and consider changes to the fare structure and pricing.

Tauranga South On Demand Trial - Six Month Performance Report & Fare Pricing Considerations

Executive Summary

Since 25 March 2025 the Tauranga South On Demand Trial has been in operation, over six months. Data has been collected during the trial’s duration and this paper provides the first performance report provided at Attachment 1: Baybus On-Demand: Six-Month Performance Monitoring Report.

Furthermore, the paper provides information to support a decision to raise the fare price for the On Demand service, with five options outlined. The staff recommended option, is Option 3, which would see the Adult Cash fare rise to $5.

An April 2025 go-live timeframe is estimated to be the best timeline achievable given the complexity of the changes required to the technology that feeds into fare and other inter-dependent system changes, including the relocation of Tauranga’s CBD interchange to Durham Street south.

If the Committee chose to implement a fare change from April 2025 it would allow data to be collected on the fare change across six months i.e., up to the end of the trial in late September 2025.

Recommendations

That the Public Transport Committee:

1 Receives the report, Tauranga South On Demand Trial - Six Month Performance Report & Fare Pricing Considerations;

2 Agrees to increase the fare price of the Baybus On Demand service in line with Option 3, outlined herein, and that it be implemented from April 2025 for the remainder of the trial;

3 Agrees to inform the public of any proposed changes, rather than undertake specific consultation to inform decision making; and

4 Notes that any decision to change fare pricing for Baybus On Demand would be subject to confirmation with funding partners.

1. Introduction

Since 25 March 2025 the Tauranga South On Demand Trial has been in operation. It is expected to operate for a period of up to 18 months, finishing in September 2025.

As part of the trial, monitoring has been undertaken to assess the trial’s performance, including its financial performance and viability. The financial viability of the trial has, in recent times, become an item of heightened interest – particularly given governments retraction on funding for public transport and forthcoming patronage targets that will require Public Transport Associations (PTAs) to increase the private share of cost recovery.

To that end, this paper provides two key items:

1. A six-month performance report provided at Attachment 1: Baybus On-Demand: Six-Month Performance Monitoring Report; and

2. Information to support a decision to raise the fare price for the On Demand service.

Of the above two items, the performance report is for information only, but it does provide valuable context to support the Committee’s decision regarding possible fare pricing increases.

1.1 Legislative Framework

Regional Council is responsible for funding and contracting public transport services under Part 5 of the Land Transport Management Act 2003 (LTMA).

The overall purpose of the LTMA is to contribute to an effective, efficient, and safe land transport system in the public interest. Section 115 of the LTMA includes a set of principles that are intended to guide the actions of Regional Councils in undertaking their public transport functions.

1.2 Alignment with Strategic Framework

Connected and enabled communities

Goal 8 Communities are connected through an effective transport system, land use and urban design that improves wellbeing, livability and environmental outcomes.

1.2.1 Community Well-beings Assessment

Dominant Well-Beings Affected

þ Environmental

Low - Negative

þ Cultural

Low - Negative

þ Social

Low - Negative

þ Economic

Low - Negative

Increasing the cost of fares on the On Demand service would likely have a negative impact across the four dominant well-beings. However, fare increases may have several benefits, including information to understand how fare pricing may impact the On Demand market and determine if changes could increase fare recovery ratio for the service, among others.

2. Context

The Tauranga South On Demand Trial began operation on 25 March 2024, under the brand name ‘Baybus On Demand’. The aim of the trial is to better understand how an on-demand service can complement and/or replace fixed public transport and increase patronage.

The trial consists of five electric vehicles operating a rideshare service within the Tauranga south area seven days a week (6am-7pm). The trial is expected to operate for a period of up to 18 months, finishing in September 2025, at the latest. The trial replaced the Route 51 fixed service – operating between Pyes Pa and Tauranga Crossing.

The standard adult fare is $3.40 when paying through the On Demand phone application. However, several concessions are applied to this standard fare price.

Local share funding of $977,000 was allocated in the 2023-24 Annual Plan by Regional Council. This was supported by an NZTA capped allocation of $1.0M. The total investment was $1.97M. Consideration of funding the On Demand trial beyond the current 18-month trial period will be considered through the 2024/25 Annual Plan process.

2.1 National Policy & Funding Context

The Government Policy Statement for land transport (GPS 2024) sets the Government’s priorities for land transport investment over the next 10-year period. GPS 2024 notes the declining private share of public transport costs and the corresponding increase in National Land Transport Fund (NLTF) share in recent years, as illustrated by Figure 1.

A graph of a graph showing the number of shares

Description automatically generated with medium confidence

Figure 1: Funding share of public transport costs 2010 – 2022.

GPS 2024 sets out clear expectations of local government requiring “greater farebox recovery and third-party revenue by Public Transport Authorities (PTAs) … to help support the increased costs that are occurring through the public transport sector and to reduce pressure on ratepayers and taxpayers”.

Subsequently, the New Zealand Transport Agency – Waka Kotahi (NZTA) have been tasked to work with PTAs to increase private share funding, including identifying and agreeing fare recovery targets by December 2024 and longer-term targets by December 2025. To this end, staff are currently working on the Regional Fares Review – a separate, yet connected, piece of work.

It is within this context, and through a review of the regional fares, that staff have been asked to consider increasing fares for the On Demand service. Consideration of this is provided from Section 4, within this report.

3. Performance Monitoring Reporting

As part of the operation of the trial, staff have been monitoring its operation. Previous reporting has been provided through Transport Arotake Reports, here.

This reporting has been provided at a high-level and in a largely an ad-hoc manner. Now, with over six-months’ worth of data collection, some clearer findings and views can be formed. Key findings, as outlined at Attachment 1, note:

· A total patronage of 18,798 carried;

· A vehicle utilisation of 47%;

· A 5% Fare Recovery Ratio (FRR) with forecasts remaining at a similar level for the 2024/25 financial year;

· Operating expenditure is tracking on budget;

· Operating revenue has a minor variance of approximately -$38,000;

· That patronage is 536% higher than Route 51, which was paused for the trial period

· That the total average cost per passenger is $2.80 higher for On Demand than Route 51 service at $27.93 and $25.17, respectively; and

· Customer satisfaction is high – 93% have given the service a five-star rating, 92% considered the fare represented value for money, and of those, 46% would still choose the service if fares were increased to $5.

With decisions on the trial’s future potentially imminent, and opportunities to make changes to the composition of the trial, closer monitoring and reporting is increasingly relevant. To that end, it is intended that the following performance monitoring reports will be produced:

1. Six-month performance report: the first of three reports covering the six months – April-September, 2024 – of the trial. This report is provided as Attachment 1.

2. 12-month performance report: the second of three reports covering the period October 2024 – March 2025.

3. 18-month performance report: the final report, covering the remainder of the trial period – April-September, 2025.

4. On Demand Fare Pricing

Fare pricing for the On Demand service was set at the same standard rate as the fixed urban services, at $3.40 for the full adult fare, and discounted to $2.72 with a Beecard. Any concessions are applied to the adult fare price and require the use of a Beecard.

As outlined at Attachment 1, the key metric that supports understanding the impact of fare prices on operational cost is the Fare Recovery Ratio (FRR). FRR can be described as the percentage of operating costs covered by fare revenues, indicating how much of the service's expenses are funded by passenger fares rather than subsidies or other sources. Table 1 provides actual and forecast FRR for the On Demand service.

Table 1: On Demand Fare Recovery Ratio - Actual & Forecast

Period	FRR	Comment
Quarter 4 – 2023/24	3.7%	As Included in Transport Arotake for same periods.
Quarter 1 – 2024/25	6.2%	As Included in Transport Arotake for same periods.
Forecast – 2024/25 Financial Year	4.7%	Forecast FRR based on actuals from Q4 2023 and Q1 2024, up to 30 June 2025. Does not account for potential fare increases.

Based on the above figures, if fare prices remain at current levels, FRR is forecast to be approximately 5%. The average FRR across the Tauranga network is 12.8%, therefore by comparison, the On Demand service FRR is relatively low. As noted, the current average cost per passenger is $27.93.

Following direction provided at a recent fare review workshop, options to increase the fare price for the On Demand service have been considered. Ultimately, any fare price changes could be deemed as a ‘trial within the trial’ and would enable staff and the Committee to:

· Determine the extent of any change to the current fare price;

· Understand market sensitivities to an increase in fare costs; and

· Potentially support an increased fare recovery ratio for the trial service.

Data would then be utilised to support future performance monitoring and further inform decisions on the future of the service, beyond the trial.

4.1 Changes to Fare Pricing – Options

Five options are provided, as outlined in Table 2, below.

Table 2: Fare Pricing Options

Option

Comment & Price Change

Option 1

Maintain the status quo.

Keep fares at the current level – no changes are required. The current Adult Cash fare is $3.40, or $2.72 with a Bee Card.

Option 2

Increase the Adult Fare to $4.40, or $3.40 with a Bee Card. A 50% concession applies to other fares.

Option 3

(Staff Recommended)

Increase the Adult Fare to $5, or $4 with a Bee Card. A 50% concession applies to other fares.

Option 4

Increase the Adult Fare to $6, or $4.50 with a Bee Card. A 50% concession applies to other fares.

Option 5

Increase all fares to $4.50 i.e., a flat fare – no concessions.

The four options to increase the fare price are modelled at a high-level, with forecast patronage and revenue impacts provided, in Table 3, below. Option 3 is the staff recommended option.

Option 1 has not been modelled, as no changes are proposed. Attachment 1 provides significant detail related to Option 1 i.e., six-months of data on current fare pricing.

Table 3: Fare Increases & Modelled Impact

	Option 2	Option 3	Option 4	Option 5
*Fare increases*
*Adult Cash*	$ 4.40	$ 5.00	$ 6.00	$ 4.50
*Adult Beecard*	$ 3.40	$ 4.00	$ 4.50	Flat Fare for All Users
*Child Cash (50% Adult)*	$ 2.20	$ 2.50	$ 3.00
*Child Beecard (50% Adult)*	$ 1.70	$ 2.00	$ 2.25
*Senior (50% Adult)*	$ 1.70	$ 2.00	$ 2.25
*Supergold*	$ -	$ -	$ -
*Community Connect (50% Adult)*	$ 1.70	$ 2.00	$ 2.25
*Modelled impact*
*Patronage Impact*	-10%	-15%	-20%	-24%
*Revenue Impact*	+$ 12,004	+$ 17,565	+$22,819	+$33,045
*Forecast 2024/25 FRR*	5.8%	6.4%	6.9%	7.9%
*Increase to 2024/25 FRR forecast*	1.2%	1.7%	2.2%	3.2%

4.2 Staff Recommendation

Of the options to increase fares, staff consider that Option 3, as the preferred, because:

· Based on customer feedback, 92% considered the current fare represented value for money, and of those, 46% would still choose the service if fares were increased to $5 – the price of an Adult Cash fare recommended by Option 3.

· It maintains a differential between On Demand, which is a “rideshare” service, and private hire/taxis, which offer a private door-to-door service.

· It provides a likely increase fare recovery without impacting patronage too significantly.

· It creates an opportunity to test market sensitivities and supports data collection to determine the impact of the change.

· It includes a charge for all users, except for SuperGold eligible customers, and therefore captures most of the market as a paying customer.

4.2.1 Operationalising a fare-price change

To implement a change to the fare pricing for the On Demand service, several operational matters need to be taken into consideration. Table 4, below, provides a timeline for implementing a change if the Committee resolved to increase fares. April 2025 is the estimated go-live date for fare changes to be when it would be best, and achievable, to make the change.

Table 4: Timeframe to operationalise a fare change.

Date	Output & Comment
*15 December 2024 –* *15 January 2025*	No changes can be made to ticketing systems over a Christmas freeze period. This is a measure put in place by RITS consortium, of which BOPRC is a member, intended to ensure that time can be factored into enable changes outside of the holiday season.
*February 2025*	Update to data systems undertaken. Such changes need to align with other operational matters requiring change e.g., Tauranga interchange relocation. Communications outputs released to customers and communities within the trial area.
*April 2025*	*Estimated go-live* with system change to support updated fare costs. Timed alongside other key operational changes.
*April – September 2025*	Increase in fares trialled within the On Demand trial period, up to the trial’s contracted trial period. Allows for a six-month fare-trial.
*September 2025*	The On Demand contract is set to expire 25^th September 2025. No decisions have yet been made on its future beyond this date. Without intervention, the trial will cease on this date.

The timeline is the best that can be achieved given the complexity of the changes required to the technology that feeds into fare changes and other inter-dependent changes to systems, for example, the relocation of Tauranga’s CBD interchange to Durham Street south.

If the Committee would like to see a change to the fare pricing, a decision on that needs to be made at this meeting to ensure that the timeline can be met. Staff will work on implementing a fare change between now and the implementation date – estimated to be April 2025.

If the Committee choose to implement a fare change from April 2025, it would allow data to be collected on the fare change across six months i.e., up to the end of the trial in late September 2025.

5. Considerations

5.1 Risks and Mitigations

There are factors that supports the opportunity to increase fares for the On Demand service, including the government policy position outlined above, the relatively low FRR measured to date for the service, and the opportunity to trial the impact of fare increases during the trial period. However, any decision to do so should be considered alongside possible risks, outlined Table 5, below.

Table 5: Risks of Increasing Fare Pricing

Risk	Comment & Mitigation
*Operational*	A fare price increase would not be able to occur until April 2025, due to several system wide change requirements. There is a risk some changes may take longer than expected but staff currently consider April to be achievable.
*Cost*	Delivering any change will incur staff time as part of BAU. Initial estimates to support associated communication and system changes would likely cost approximately $5,000, predominantly related to administrative costs associated with system updates.
*Patronage impact*	It is likely that any increase in fares will have a patronage impact. Staff consider that Option 3 provides a reasonable balance with a modelled impact of -15% on patronage. Additionally, any fare increase will have a commensurate positive impact on FRR, modelled at 6.4%.
*National Ticketing Solution (NTS)*	Alignment with NTS requirements will need to be accounted for, however, assurances have been provided at a national level that configuration and changes in conjunction with NTS roll-out are achievable. Communications to inform the changes to any fares for On Demand and the delivery of NTS will be well communicated to mitigate customer confusion.

On balance, staff consider that any increase in fares for the service is achievable and a worthy consideration, particularly given the trial nature of the service.

5.2 Climate Change

The use of public transport instead of individual cars is inherently supportive of climate change mitigation, through reduced emissions. While the potential introduction of higher fare levels may result in a degree of patronage reduction and potential shift to car use, due to the trial nature of the On Demand service, any impacts over the increased fare period of approximately six-months will be unlikely to have any significant impact, particularly with the trial utilising fully electric vehicles.

5.3 Implications for Māori

Fare increases are likely to have an impact on Māori. However, given the contained nature of the trial within a restricted geographic area, and that any fare increase is only intended to be for a six-month period, impacts for Māori are likely to be minor.

5.4 Community Engagement

INFORM

Whakamōhio

To provide affected communities with balanced and objective information to assist them in understanding the problems, alternatives and/or solutions.

If the Committee decides to increase the fare of the On Demand service, community engagement could be undertaken. However, staff consider that this is not necessary considering:

· Other fixed route services operate within the trial area;

· Fare price changes will be communicated well in advance;

· Change is more likely to be expected, given the “trial” nature of the service;

· Customer surveys are available 24/7 via the phone application; and

· It is likely to extend the delivery timeframe for which a fare change could be implemented and may extend it past April – the current estimated go-live timeframe.

It is therefore the staff recommendation that a well-directed marketing and communications strategy be commenced from early 2025 to support any change.

5.5 Financial Implications

If the recommendation is adopted by Council, will it result in:

If the answer is ‘no’ to both questions please select the dropdown option 1 and complete appropriately.

If the answer is ‘yes’ to either question please select “Budget Implications” in the building block below and liaise with your Management Accountant in order to complete the Financial Impact table.

The financial implications for this change are provided for in Section 4.1, above.

6. Next Steps

The 12-month Performance Monitoring Report will be provided to the Committee on its release.

Next Steps: What next? What resources are needed? Further analysis? Timeframes ahead. Any consultation planned. Remind Council of the process ahead. Next update to Council?

Conclusion: Short concluding remarks. Referring back to recommendations. No new content.

If the Committee resolves to implement fare changes to the On Demand service, staff will commence operational requirements.

Attachments

Attachment 1 - Baybus On Demand Six-Month Performance Monitoring Report ⇩

[1] Elasticities are an economic concept to measure of how responsive one economic variable is to a change in another. For fares modelling, an elasticity range is used to estimate how patronage will respond to changes in fare.

[2] NZTA is looking to issue its ‘Increasing Private Share’ engagement document in the same week as the next Public Transport Committee meeting.

[3] NZTA’s ‘Development Guidelines for Public Transport Plans 2024’ states that ‘PTAs should seek to minimise the use of cash over time and include their position for the use of cash in their fares and pricing policy’.

Chairperson	Cr Andrew von Dadelszen
Deputy Chairperson	Cr Lyall Thurston
Members	Cr Malcolm Campbell Cr Jane Nees Cr Ken Shirley Cr Paula Thompson
External Members Two Tauranga City Council representatives One representative each: Rotorua Lakes Council Western Bay of Plenty District Council Whakatāne District Council All of whom are voting members. One Waka Kotahi NZTA non-voting representative	Cr Glen Crowther Cr Rod Taylor Cr Rick Curach (Alternate) Cr Conan O’Brien Mayor Tania Tapsell (Alternate) Mayor James Denyer Deputy Mayor John Scrimgeour (Alternate) Cr Andrew Iles Cr Gavin Dennis (Alternate) Susan Collins Garry Maloney (Alternate)
Ex Officio	Chairman Doug Leeder
Quorum	Six members, consisting of more than half the number of voting members of which four must be BOPRC members
Meeting frequency	Quarterly