Metro Fare Restructuring Proposals

8/13/2019 Metro Fare Restructuring Proposals

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The approved n o t i c e w i l l be posted a n d d i s t r i b u t e d f o l l o w i n g the January 2014 B o a r dadopt ion of h i s r e p o r t . A d d i t i o n a l outreach i l l a l s o b e conduc ted a t Metro ServiceCo u n c i l s n March , a s e l l a s t h e r c o m m u n i c a t i o n s e h i c l e s t o encourage p u b l i cc o m m e n t . The Board i l l p r e s i d e over he p u b l i c h e a r i n g a n d r e c e i v e tes t imony r o mthe p u b l i c o n these m a t t e r s . A t a f f r e p o r t w o u l d then b e prepared s u m m a r i z i n g t he

f i n d i n g s of he p u b l i c h e a r i n g a long w i t h s p e c i f i c s t a f f recommenda t ions . The e p o r tw o u l d be presented t o the Board of i r e c t o r s a t i t s r e g u l a r meeting o n May 2, 2014 o ra c t i o n . n i t i a limplementat ion of he a r e adjustments s proposed o r Sep tember ,2014.

DISCUSSION

S t a f f i s propos ing t w o p t i o n s f o r a e v i s e d f a r e s t r u c t u r e a s presented i n At tachment A .H i g h l i g h t s of he proposed changes are s u m m a r i z e d below.

n Opt ion 1 At tachment A , page ) , the b a s e a r e a l l o w s u n l i m i t e dm u l t i d i r e c t i o n a l t r a n s f e r s t o a n y Metro a i l or b u s i n e w i t h i n 9 inu tes ofp a y me n t w h en u s i n g a TAP a r d .

pt ion 2 At tachment A , pag e 3 ) l s o a l l o w s u n l i m i t e d m u l t i d i r e c t i o n a l t r a n s f e r st o a n y Metro a i l or b u s i n e w i t h i n 9 i n u t e s w h en u s i n g a TAP a r d a n di n t r o d u c e s lower a r e s d u r i n g o f f-peak hours a n d h i g h e r f a r e s d u r i n g peak h o u r s .

Both o p t i o n s have been developed a s a m u l t i-year a r e r e s t r u c t u r i n g p r o g r a m i n t h r e ephases , i t h i n c r e m e n t a l c h a n g e s a k i n g p l a c e i n FY15 , FY18 a n d FY21.

Monthly p a s s e s i l l be o n s o l i d a t e d w i t h EZ a s s e s e g i n n i n g i n Phase 2,a l l o w i n g passenger s o connec t e f i n r e e n Metro a n d o t h e r l o c a l t r a n s i t o p e r a t o r su s i n g

ai n g l e pass . This o n s o l i d a t i o n

a l s o e l i m i n a t e sa d d i t i o n a l

f a r e s f o r r i d e r sw i t h a Metro p a s s r a n s f e r r i n g t o a m u n i c i p a lc a r r i e r . Fares o r Express b u s i n e s w i l l be o n s o l i d a t e d i n t o one p re miu m surcharge. Fares i l l be d j u s t e d every t w o years based o n C o n s u m er r i c e Index C P I )

b e g i n n i n g i n FY23 n order o keep a r e s i n l i n e w i t h i n f l a t i o n r a t e s .

Metro p r o p o s e s o r e a l i g n f a r e s w i t h s e r v i c e t h i s year a n d o c o n d u c t a m o r ecomprehensive s t u d y of e r v i c e s next e a r .

M a n y passengers r a n s f e r a t l e a s t one ime o reach t h e i r d e s t i n a t i o n , but he u r r e n tf a r e s t r u c t u r e r e q u i r e s p a y me n t o r each b o a r d i n g . While Metro f f e r s discounted i n t e r -a g e n c y r a n s f e r s Metro o M u n i ) ,we o not f f e r i n t r a - a g e n c y r a n s f e r s Metro oM e t r o ) . M e t r o s c u r r e n t f a r e s t r u c t u r e p e n a l i z e s t r a n s i t - dependent i d e r s f o r t r a n s f e r r i n galthough i n d u s t r y trends s h o w h a t m o s t r a n s i t agencies f f e r f r e e or discountedt r a n s f e r s . The n a b i l i t y t o t r a n s f e r r e s u l t s i n s y s t e m i n e q u i t i e s , because i d e r s w h o s eo r i g i n a n d d e s t i n a t i o n are not erved by a i n g l e r o u t e p a y m o r e w h en not s i n g a p ass .F u r t h e r , t h i s m o d e l d o e s not encourage u l l use of he p u b l i c investment n M e t r o ss y s t e m .

P u b l i c Hearing o r Fare e s t r u c t u r i n g Pa g e 2





now. d j u s t i n g f a r e s w i l l h e l p i n c r e a s e revenues o fund f u t u r e p r o j e c t s a n d o p e r a t i o n a lc o s t s .

Metro cus tomers h a v e s e e n o n l y t h r e e f a r e increases i n n i n e t e e n y e a r s . I n 2008s e n i o r , d i s a b l e d a n d s tudent a r e s we r e frozen th rough D e c e m b e r 2 0 1 2 and r emain

f r o z e n .As

a b o r costs a n d o t h e r costs h a v e r i s e n , M e t r o s f a r e revenues h a v e n o t k ep tp a c e w i t h i n f l a t i o n . Metro m u s t increase t s f a r e revenues o adhe re o i t s LRTP nd beable t o m e e t t s e x p e n s e s .

T h re e P h a s e d A p p ro a c h

To i n i mi ze i n a n c i a l i m p a c t o cus tomer s h i s f i s c a l l y r e s p o n s i b l e f a r e p o l i c y wouldi n c o r p o r a t e gradual a n d p e r i o d i c f a r e changes .

Fare r e s t r u c t u r i n g has been proposed i n t h r e e phases i t h i n c r e m e n t a l 25¢ base a r ec h a n g e s c c u r r i n g every h r e e y e a r s , a n d p a s s a r e s i n c r e a s i n g a c c o r d i n g l y . T h e i r s t

p h a s e d c h a n g e would t ak e place i n FY15 he s e c o n d i n F Y 1 8 and the t h i r d i n FY21 .T h e a r g e t e d farebox recovery r a t i o of 33 would be accompl i shed w i t h theimpl ementat ion of P h a s e 3 .

C o n s o l i d a t i o n of Regula r Monthly P a s s e s a n d EZ a s s e s

T h e c h a n g e s unde r o n s i d e r a t i o n i n c l u d e c o n s o l i d a t i n g the Metro r e g u l a r monthly p a s sw i t h the EZ ass l l o w i n g r i d e r s t o connec t o o t h e r t r a n s i t o p e r a t o r s a n d r i d ethroughout LA C o u n ty i t h o n e pass. H o w e v e r b e c a u s e l l m u n i c i p a l operators are noty e t TAP - enabled h i s a l t e r n a t i v e can o n l y be i m p l e m e n t e d d u r i n g P h a s e 2.

S i l v e r a n d E x p r e s s B u s Lines

Also o b e n e f i t r i d e r s , t h i s proposal i n c l u d e s a i m p l i f i c a t i o n of o n e a nd p r e m i u m f a r e s .Un d e r the c u r r e n t f a r e s t r u c t u r e , a p r e m i u m f a r e i s cha rged on the S i l v e r L i n e , andt h e r e are t wo z o n e u p c h a rg e s n a d d i t i o n t o the base a r e f o r Express buses. To

s i m p l i f y the a r e s t r u c t u r e , the proposed c h a n g e s n c l u d e the c o n s o l i d a t i o n of the t woexp ress z o n e s n t o o n e p r e m i u m surcharge. Furthermore the n e w a r e s t r u c t u r eequal izes the a r e s f o r the S i l v e r L i n e a n d E x p r e s s buses i t h the goal of v e n t u a l l ye l i m i n a t i n g zones . O n c e z o n e s h a v e been e l i m i n a t e d , the cost of i d i n g the S i l v e r L i n eor an E x p r e s s bus would be the same s the base a r e .

Future Fare Adjus tmen t s Ba s e d on CPI

H i s t o r i c a l l y , M e t r o s fares h a v e not kep t p a c e w i t h i n f l a t i o n . This creates a i t u a t i o n i n

which f a r e s l l behind a n d increases b e c o m e r e a c t i o n a r y , m a k i n g t h e m u n p r e d i c t a b l et o r i d e r s .

To nsu re t h a t the farebox recovery r a t i o rema ins a t a u s t a i n a b l e l e v e l beyond t heimpl ementat ion of P h a s e nd t o a l l o w the r i d i n g p u b l i c t o p l a n a c c o r d i n g l y , Metro

P u b l i c Hearing f o r Fare R e s t r u c t u r i n g P a g e 4



s h o u ld c o n s i d e r r e v i s i n g i t s f a r e p o l i c y t o a l l o w f o r f a r e a d ju s tme n t s c o m m e n s u r a t e w i t ht h e r a t e of n f l a t i o n . Ev e r y t w o y e a r s , f a r e s s h o u l d be a d j u s t e d by CPI , r o u n d e d t o t hen e a r e s t 5¢ o r r e g u l a r fa re s a n d t o the nea re s t d o l l a r f o r p a s s e s .

T i t l e V I

B a s e d o n a T i t l e V I a n a l y s i s , t h e t w o o p t i o n s a s p r e s e n t e d i n A t t a c h m e n t A o n otc rea te a n y d i s p a r a t e i m p a c t s or d i s p r o p o r t i o n a t e b u r d e n s o n M e t r o s m i n o r i t y a n d l o w -i n c o m e r i d e r s . S t a f f i s c u r r e n t l y p e r f o r m i n ga i t l e V I a n a l y s i s o n w h e t h e r o f f e r i n g o f f -

p e a k d iscoun ts o n l y t o TAP a r d u s e r s p o s e s a d i s p a r a t e i m p a c t or d i s p r o p o r t i o n a t eb u r d e n o n m i n o r i t y or low- i n c o m e r i d e r s . T h e u l l T i t l e V I a n a l y s i s w i l l be p r o v i d e d a t t h eM a r c h 29, 2014 p u b l i c h e a r i n g .

F I N A N C I A L IMPACT

I n P h a s e 1 , t h e p r o p o s e d f a r e r e s t r u c t u r i n g i s es t ima ted t o p r o v i d e app rox ima te ly 30M

of i n c r e m e n t a l f a r e r e v e n u e s o v e r t h e FY15 b u d g e t e d a m o u n t of350M

o r t o t a lFY15

f a r e r e v e n u e s of 380M. I m p l e m e n t a t i o n of P h a s e 2 s es t ima ted t o p r o v i d eapp rox ima te ly 41 M f i n c r e m e n t a l f a r e r e v e n u e s o v e r t h e FY18 p r o j e c t e d a m o u n t of 384M o r t o t a l FY18 a r e r e v e n u e s of 4 2 5 M . P h a s e 3 s es t ima ted t o p r o v i d eapp rox ima te ly 53M f inc remen ta l f a r e r e v e n u e s o v e r t h e FY21 p r o j e c t e d a m o u n t of 417M o r t o t a l FY21 f a r e r e v e n u e s of 470M. d d i t i o n a l r e v e n u e s i l l be u s e d t o f u n dc u r r e n t s e r v i c e l e v e l s a n d p la n n e d e x p a n s io n s .

F i n a n c i a l p r o j e c t i o n s a s s u m e h a t inc reased f a r e s w i l lc a u s e s h o r t- t e r m d e c l i n e s i n

r i d e r s h i p a f t e r e a c h p h a s e i s i m p l e m e n t e d . i s t o r i c a l e x p e r i e n c e s u g g e s t s t h a t some

r i d e r s w i l l r e t u r n t o t h e s y s t e m w i t h i n th ree t o s i x m o n t h s a f t e r e a c h p r i c e c h a n g e .

ALTERNATIVES CONSIDERED

O p t io n 2 A t t a c h m e n t A , p a g e 3 ) s p r e s e n t e d i n A t t a c h m e n t A i e l d s the same 29%f a r e b o x recove ry r a t e a c h i e v e d i n P h a s e 1 of O p t i o n 1 . P r o j e c t i o n s i n d i c a t e t h a t thep e a k b a s e a r e i n P h a s e 1 f o r t h i s a l t e r n a t i v e s h o u l d be a t l e a s t 2.25 . This wo u l dr e p r e s e n t a 50% nc rease f r o m t h e c u r r e n t 1.50 b a s e f a r e d u r i n g p e a k h o u r s .

NEXT STEPS

Wi t h B o a r d a p p r o v a l , s t a f f w i l l i n i t i t et h e p u b l i c a t i o n of t h e l e g a l n o t i c e a n d p r e p a r e f o rt h e u p c o m i n g p u b l i c h e a r i n g .

ATTACHMENTS

A . N o t i c e of P u b l i c H e a r i n g

P u b l i c H e a r i n g f o r Fare R e s t r u c t u r i n g P a g e 5



P r e p a r e d b y : N a l i n i A h u j a , Execu t ive D i r e c t o r O f f i c e o f M a n a g e m e n t a n d B u d g e t 2 1 3 ) 92 2 -3 0 8 8M i c h e l l e N avar ro , D i r e c t o r o f Budge t , f f i c e o f M a n a g e m e n t a ndB u d g e t

P u b l i c Hearing f o r F are R e s t r u c t u r i n g P a g e



P a u l C. Ta 3 Fo r ~Deputy C h i e f E x e c u t i v e O f f i c e r

~

r t h u r T. L e a h yC h i e f E x e c u t i v e O f f i c e r

P u b l i c H e a r i n g f o r Fare R e s t r u c t u r i n g P a g e



Attachmen t A

Notice o f P u b l i c Hear ingL o s Angeles M e t r o p o l i t a n T r a n s p o r t a t i o n A u t h o r i t y

A u b l i c h e a r i n g w i l l b e h e l d b y the Board of i r e c t o r s of the L o s Angeles C o u n t yM e t r o p o l i t a n T r a n s p o r t a t i o n A u t h o r i t y Metro) n Saturday March 29 , 2014 t 9 :OOam i n

the Metro Headquar ters B u i l d i n g , l o c a t e d a t One a t e wa y Plaza, Los Angeles . Th eh e a r i n g i s b e i n g h e l d i n con fo rmance w i t h f e d e r a l p u b l i c h e a r i n g requirements o u t l i n e di n Section 9 e) 3) H) f the Surface T r a n s p o r t a t i o n Assistance Act of 1982 , asa m e n d e d , a n d p u b l i c h e a r i n g g u i d e l i n e s adop ted b y M e t r o s Board of i r e c t o r s i n 1993 ,a s a m e n d e d .

U n d e r the n e w a r e s t r u c t u r e , b e g i n n i n g i n P h a s e 1 , the b a s e a r e w i l l i n c l u d e u n l i m i t e d

m u l t i d i r e c t i o n a l t r a n s f e r s t o a n y Metroi l

or b u s i n e w i t h i n 90 inu tes o fi r s t

boardingw h e n u s i n g a TAP a r d . T h e a s t boarding mu s t occur i t h i n 90 inutes of the i r s t

b o a r d i n g . Beginning i n P h a s e 2 , the month ly pass i l l b e o n s o l i d a t e d w i t h the EZpass, l l o w i n g customers o r i d e Metro v e h i c l e s a n d connect o o t h e r l o c a l t r a n s i t

operators u s i n g a i n g l e pass. f t e r P h a s e 3 nd beginning i n FY2 3 , a r e s w i l l b ea d j u s t e d b y the C o n s u m e r r i c e Index C P I ) v e ry tw o years o ensure h a t fares keeppace w i t h i n f l a t i o n .

Option 2 n c l u d e s l l of the a b o v e c h a n g e s a n d i n t r o d u c e s reduced o f f-peak a r e f o rr e g u l a r r i d e r s M o n d a y o F r i d a y f r o m gam o 3pm nd 7pm o S a m . T h e n i t i l boardingw i l l determine the a r e . O f f-peak i n c l u d e s l l d a y o n the w e e k e nds a n d l l f e d e r a lh o l i d a y s . This o p t i o n can p o s s i b l y s h i f t r i d e r s f r o m p e a k o o f f peak h o u r s .

The p u r p o s e of h i s h e a r i n g i s t o r e c e i v e p u b l i c testimony o n p o s s i b l e r e s t r u c t u r i n g ofM e t r o s f a r e s t r u c t u r e . T he se changes are necessary o finance M e t r o s b u s and i l

operations a n d planned expansions . Ba s e d o n a Ti t l e VI a n a l y s i s , the i n r oo p t i o n s a spresented d o n o t c r e a t e a n y i s p a r a t e impacts or d i s p r o p o r t i o n a t e burdens o n m i n o r i t y

or low- i n c o me r i d e r s . The u l l Ti t l e V I a n a l y s i s w i l l b e p r o v i d e d a t the March 29 , 2 0 1 4p u b l i c h e a r i n g . L i s t e d be low are the proposals n o w under o n s i d e r a t i o n :



OPTION 1

CURRENT PHASE PHASE Z PHASE 3FY15 FY18 FY21

Re u l a r Cur ten t r i c i n

1 .50ase Fare (90 r ~ n t r a n s f e r TAP ard o n l y )

Day Pass 5 .00

Weekly (7 ay) 20.00

Monthly (30 day) 75 .00

EZ as s 85 .00

Muni Transfers 0.35

Monthly Zone Upcha rge E Z / S i l v e r/Express) 22.00

SeniorlDisabled_ _

Peak 0 .55

Of f-Peak 0.25

Day Pass 1 .80

Monthly (30 day) 14 .00

EZ as s 35.00

Monthly Zone Upcha rge (EZ Pass) 9.50M u n i Transfers 0 .10

1.00

Stu d en f /Co l i eg e

Student C as h

S t u d e r r t 30 Da y 24.00

College 30 Da y 36.00

Silver

Regular Silver 2 .45

S i l v e r Upcha rge 0 .25 0.95

Sen io r /Disabled S i l v e r 1 .15

Sen io r /Disabled Of f -peak i l v e r 0 .85

Senior /Disabled S i l v e r U~:hame3 _ 0 .30 - 0.60

E x p res s-- _ _ -

2 .20 - 2.90xpress Fare

Express Zone Upcharge3 0 .70 - 1 .40Sen io r /Disabled Expr ess Upcharge 0 .30 - 0.60

Boardings

IMPACTS:

F areb o x R e c o v e r y 26

Fare pe r Board ing 0 .70

A-- _

A

2 .001 .75

7 .00 8.00

25.00 30.00

100 .00 Consolidate w/EZ

110 .00 120 .00

0 .50 0.50

22.00 22.00

0.75 0.90

0.35 0.50

2.50 3.00

20 .00 24.00

42 .00 50 .00

9.50 9.50 0.25 0.25

1.25 1 .50

29.00 35.00

43.00 52.00

-- . .

2.502.50

0 .75 0 .50

1.35 1 .35

0.95 0.95

0.60 0 .45

2.502.50

0.75 0.50 0 .60 0.45

-4 -3

0.85/ 90

A

2.25 -- -

9.00

32.00

Consolidate w/EZ

135.00

0.50

22.00

1 .10

0.70

3.50

28.00

60 .00

9.50 0.25

1.75

42.00

62 .00

2.50

0.25

1.35

0.95

0.25

2.50

0.25 0.25

-2

3 4 . 1 4 %

1 . 11

~ O ff-Peak hours are Weekdays 9 .m. - .m. and 7 .m. - .m. and l l day o n weekends an dFederal h o l i d a y s .Z T h e p e c i a l f a r e s f o r S i l v e r and Express i n e s w i l lb e g r a d u a l l y phased out o b e the same r i c e as th ebase a r e .3 T h e i l v e r and Express upcharge a p p l i e s t o weekly, monthly and EZ ass h o l d e r s . Senior / D i s a b l e d ,Students / C o l l e g e monthly pass h o l d e r s and Day Pass h o l d e r s pay no d d i t i o n a l upcharge, u r r e n t l y o r nany u t u r e phases

2



OPTION'2 -Off Peak inc luded

CURRENT PHASE PHASE 2 PHASE 3FY75 FY18 - -- FY21

Re u h a r Curren t r i c i n

Base Fare 90 r i n t r a n s f e r TAP ard o n l y ) 1 .50

Off Peak

Day Pass 5.00Weekly (7 ay) 20.00M o n t h l y(30 ay) 75.00EZ as s 85.00M u n i r a n s f e r s 0 .35M o n t h l yZone Upcharge S i l v e r/ F ~ c p r e s s ) 22.00Monthl Zone U harge( EZ ass) 22.00Sen iodDisab ledPeak 0.55

Off -Peak 0 .25

DayPass 1 .80

M o n t h l y(30 day) 14 .00EZ as s 35.00M o n t h l yZone Upcharge (EZ ass) 9.50M u n i r a n s f e r s 0 .10S t u d e n U C o l l e e

Student Cash 1.00Student 3 0 Da y 24.00C o l l e g e30 ay. - - _ _--

36.00S i l v e r

Regular Silver 2 .45

Regular i l v e r O f f-PeakS i l v e r Upcharge3 0.25 0.95Senior / D i s a b l e d S i l v e r 1 .15

Senior / D i s a b l e d O f f-peak i l v e r 0.85Senior / D i s a b l e d S i l v e r Upcharge 0.30 - 0.60

Ex ress - - 2.20 2.90egular Express

Regular Express O f f-Peak

Express Zone Upcharge3 0.70 1.40

Senior / D i s a b l e d Express 0 .85 1.15

SeniodDisabled Express Upch arge 0.30 0.60Boardings

IM PAC TS:Farebox Rec overy 26%

Fare er Board in 0.70

A-

A A

2 .25 2.75 3.25

1.50 1 .75 2.00

9. 00 11 .00 13.00 32. 00 38.00 45.00

125.00 C o n s o l i d a t ew/E Z C o n s o l i d a t ew/E Z 1 35. 00 150. 00 180. 00

0.50 0 .50 0.50 22.00 0.00 0.00 22.00 22.00 22.00

0 .90 1 .00 1 .10

0.50 0.55 0.60

2 .75 3.25 3.50 22.00 25.00 28.00 42.00 50.00 60.00 9 .50 9.50 9.50 0.25 0.25

1.50

0.25

__ 1 .751.25

29.00 35.00 42.00 43 0 52 p

_Same s Base Fare

F2 0_ _ _

Same s Base Fare2.50

1.75 Same s Base Fare Same s Base Fare

0.25 n on e n on e

1 .15 Same s Base Fare Same s Base Fare

0.95 Same s Base Fare Same s Base Fare

0.45 n o n e n o n e

Same s Base Fare Same s Base Fare2.50 1.75 Same s Base Fare Same s Base Fare

0.25 n on e n on e

1 .15 Same s Base Fare Same s Base Fare

0. 25 n on e n on e-6% -3% -3%

29 .10% 31 .23% 34 .33% 0.84 0.97 1.14

~ Off -Peak hours are Weekdays 9 .m. .m. a n d 7 .m. .m. a n d l l day on weekends an dFederal h o l i d a y s .2 ~T h e p e c i a l f a r e s f o r S i l v e r a n d Express i n e s w i l lbe r a d u a l l y phased out o b e h e same r i c e as thebase a r e .3 T h e i l v e r a n d Express upcha rge p p l i e s t o weekly, monthl y a n d EZ ass h o l d e r s . Senior / D i s a b l e d ,Students / C o l l e g e monthly pass h o l d e r s a n d Day Pass h o l d e r s pay n o d d i t i o n a l upcharge, u r r e n t l y or nany u t u r e phases



F a r e c h a n g e s c o n s i s t e n t w i t h these proposals may be a p p r o v e d i n w h o l e o r i n p a r t l a t e rt h i s year based o n p u b l i c i n p u t . T h e p r o p o s e d e f f e c t i v e d a t e o r the a p p r o v e d c h a n g e si s S e p t e m b e r 1 2014 . n t e r e s t e d m e m b e r s o f the p u b l i c are encouraged t o a t t e n d t heu p c o min g p u b l i c h e a r i n g a n d p r o v i d e t e s t i m o n y . There l l a l s o be a d d i t i o n a l f a r ef o r u m s h e l d a t the r e g u l a r l y scheduled Service Council meet ings i n March . P e r s o n s

u n ab l e t o a t t e n d the h e a r i n g o r the a r e f o r u m s may ubmit a w r i t t e n testimonyp o s t m a r k e d through M a rc h 2 9 2 0 1 4 . C o r r e s p o n d e n c e sh o u l d be addressed t o :

L o s A n ge l e s C o u n t y M e t r o p o l i t a n T r a n s p o r t a t i o n A u t h o r i t yOne G a t e w a y P l a z aL o s Angeles CA 0 0 1 2 -2 9 3 2A t t n : Michele Jackson

Comments may l s o be submitted e l e c t r o n i c a l l y t o p u b l i c h e a r i n g@metro .ne t .

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Metro Fare Restructuring Proposals