CTA Tattler

The $5 fee is insufficiently high to dissuade even lower incoming people from using it. Consider how much money is lost from carrying multiple "paper" cards around due to accidental loss and disposal over time. If an individual is not rational enough, or intelligent enough to make the switch, they should be price discriminated against... sorry thats just econ 101.

by the way I think the Jewel/Dominick's preferred card example is a great one. People who are too lazy to sign-up for it are price disciminated against... even if there was a $5 fee for getting one, would that dissuade you from buying one (considering the hundreds of dollars saved throughout the year)? If you didn't get one, its your own fault. Thats how price discrimination is supposed to work.

"I'm betting you weren't at the board meeting like Sarah was or you would have heard Ron explain that the 2-day and 5 day visitor passes together represent less than 1% of passes sold, and their elimination will result in a cost savings to the CTA - all the other VP have higher usage. "

My apologies; I hadn't realized that attendance at the meeting was a prerequisite for having a valid point on here.

Anyhow, for someone who is so well informed, the information that you provide is singularly pointless. So what if the 2-day and 5-day passes account for less than 1% of pass sales. You haven't told us (and the budget document doesn't appear to, either) the comparable figures for the non-eliminated passes. And more generally, you would expect visitor passes in general to be a tiny fraction of pass sales; 30-day and 7-day passes, popular among residents, no doubt constitute a substantial majority of passes sold.

But most important of all, you've been duped by a red herring: CTA pass sales are artificially low in general because the CTA is reluctant to sell them. The CTA itself doesn't really sell its own passes: They have a handful of machines at the airports and Union Station, and of course CTA headquarters (a popular tourist destination) but that's about it. What visitor is going to think to go to the CTA website to learn that, hey, the place you should go to buy public transit fare media is... CVS? But not all CVS's, mind you... just some of them. WTF? And for that matter, for no apparent reason, the CTA has decided not to sell any of its passes at rail stations, despite the fact that they have equipment (the new credit card machines, if nothing else) that could easily dispense them.

And finally, as someone else mentioned above, the only reason offering additional visitor pass varieties costs the CTA anything extra in the first place is because the CTA insists on printing different passes in different colors. If they just printed them all on the same fare media, as is also done in New York City, then IT WOULDN'T MATTER whether they offer one type of visitor pass or 7 types, because the machines would be stocked with the same stuff and there would be no need to make a special trip to re-stock "2-day passes" if those run out more quickly than "3-day passes".

As I mentioned before, someone at the CTA has clearly taken a dislike to the whole concept of unlimited passes, since they are undoing the 1990's attempt to make them more affordable and they are eliminating various visitor passes rather than taking more straightforward steps to reduce the costs associated with them while keeping them available.

And by the way, who the heck cares that 30-day passes cost too much in the early 1990's? That's another red herring.

If some wonkish-type at the CTA has decided that unlimited passes are a bad thing, why don't they just come out and explain their view about that, rather than taking little obviously pretextual steps to slowly make passes less attractive and less available? I mean, the CTA is a public agency. Would it be too much for them to just explain what they want to do?

"by the way I think the Jewel/Dominick's preferred card example is a great one. People who are too lazy to sign-up for it are price disciminated against... even if there was a $5 fee for getting one, would that dissuade you from buying one (considering the hundreds of dollars saved throughout the year)? If you didn't get one, its your own fault. Thats how price discrimination is supposed to work."

I dispute Stephen's premise about why people don't sign up for things like that. I choose not to get such cards, mostly because the stores keep pressuring me to do it. That should tell you something about who benefits more from it--if it were me and not them, they wouldn't have to be so pushy. If all the stores care about is saving us money, there's nothing to stop them from lowering the price for everyone. You should see their reaction when they ask for "my card" assuming I must have one--I tell them "I don't do those," and sometimes the clerks give me an argument. Personally, I don't consider the savings an adequate tradeoff for what I give up: information about my purchase habits, the ability of the store to call or spam me whether I like it or not, and the requirement to swipe cards and punch buttons in order to make a purchase. But of course that's my decision--I am not complaining, because I think I have a better deal than those of you who give yourselves up to their database. So I pay cash for the merchandise. One of these days they'll try to tell me I have to identify myself and push buttons anyway, and I'll point out what it says on the money.

And no, I don't have a Chicago Card Plus, just the regular one, which I put cash on about once a week.

"They have a handful of machines at the airports and Union Station, and of course CTA headquarters (a popular tourist destination) but that's about it. What visitor is going to think to go to the CTA website to learn that, hey, the place you should go to buy public transit fare media is... CVS? But not all CVS's, mind you... just some of them. WTF? And for that matter, for no apparent reason, the CTA has decided not to sell any of its passes at rail stations, despite the fact that they have equipment (the new credit card machines, if nothing else) that could easily dispense them."

Oh come on. I think you can figure out why they don't dispense them at rail stations. They have a very good reason for not doing so. It's the same reason why they don't sell the Chicago Cards at the stations (although that reason will no longer exist if this fare equilization goes through).

1. I'm pretty sure the average CTA rider does not have a single seat train ride to work. I'm confident that the average CTA rider is a bus rider with at least 1-3 transfers on their commute.

2. Some people think that chicago card users would take an unfair hit under this increase.
We think the original discount that Chicago Card users receive over cash and fare card users was discriminatory. According to Ron Humberman, the average Chicago Card user is more affluent than those who operate on passes, fare cards, and cash (you need to be able to have a credit card). Having everyone pay the same amount, regardless of fare media is fair. Cash transfers are what lots of riders want back.

3. This fare increase doesn't have to happen if the city just starts chipping in a reasonable amount to CTA operations from its own budget. Since the 70s, the City has only given $1/person/year to the CHICAGO Transit Authority from its budget. The sales tax levied within the city limit is a state tax and does not count, though city officials will bring it up. The 43 suburbs served by cta could also put money from their municipal budgets toward it. Then we wouldn't need to talk about raising fares on people who are losing their jobs.

===
Having everyone pay the same amount, regardless of fare media is fair.
===

Even cash, which is incredibly costly to process? You don't want to make any allowence for the cost of their choice in media? How is that fair?

And beyond fair, there is the concept of what do you want to encourage. Do you not want to encourage faster boardings? Do you not want to encourage people to choose to ride more often?

The media a rider chooses to use has an effect on the system. Why can't that be accounted for?

===
This fare increase doesn't have to happen if the city just starts chipping in a reasonable amount to CTA operations from its own budget.
===

It also doesn't have to happen if enough of us voluntarily donate, too.

But let's come back into the real world. There are lots of groups and organizations, both public and private, that benefit from CTA services, and aren't voluntarily giving extra money to the CTA. That's not how the real world works.

===
I'm confident that the average CTA rider is a bus rider with at least 1-3 transfers on their commute.
===

I'm not even sure that the average CTA rider is a commuter.

There are more reasons why people ride CTA than commuting, but I think too many people tend to think of CTA as nothing but a way to move commuters. It's far more than that.

The average commuter just may have a one-seat ride, but when you expand the universe beyond commuters, the average rider probably doesn't have a one-seat ride.

There's a lot of CTA that's part of a big grid in addition to those radial EL lines. There's a reason why you see so many people boarding and alighting at major intersections, and it's not because they walked there, or are walking from there!

But that's not a good reason to bring back cash transfers.

Cash costs money. Cash raises security issues. Cash needs to be counted. Cash needs to be transported. Cash needs to be handled. And the more cash you have, the more problems you have. More cash costs more money.

And thus, even though there are a lot of people who want cash transfers, we're back to the point where we have to consider how much a particular fare media costs to process.

Simply put, the CTA can't afford cash transfers.

"We think the original discount that Chicago Card users receive over cash and fare card users was discriminatory. According to Ron Humberman, the average Chicago Card user is more affluent than those who operate on passes, fare cards, and cash (you need to be able to have a credit card). Having everyone pay the same amount, regardless of fare media is fair."

I give up. Michael Pitula, can you please read any of the three or four posts in the last few days (such as here: http://www.ctatattler.com/2008/10/analysis-of-pro.html#comment-134409367 ) that explain that you do NOT need a credit card to use a Chicago Card. I don't even know why I am bothering to respond to this because everytime I point out that the people making this assumption are incorrect they NEVER respond. I don't even think they look at the thread after they make their drive-by comment.

If, by any chance, Michael Pitula, does read this he may wish to understand the defintion of "average": http://dictionary.reference.com/browse/average The context he is using it doesn't make sense, as Rusty has sort of pointed out.

And it also shouldn't be too hard ro read the whole thread before commenting. I think it displays a certain level of rudeness to display so clearly, like Michael Pitula, that one is only interested in stating something but not actually reading what others have stated.

MK wrote: "I think you can figure out why they don't dispense them at rail stations. They have a very good reason for not doing so."

What is the reason?

I answered that in the next sentence after the part you quoted.

Ok, about Jewel, they dont spam you, they dont sell your info, they dont give a shit where you live. The only reason they have you sign up is to price discriminate... do a google learn about that subject and you'll realize why they do it. Its because they can upsell products to people like you because you're paranoid, lazy, or, more important, irrational. So you're willing to pay more. But they can't upsell everyone so they offer and promote a card (which comes with the benefit of customer loyalty) to those who seek a better deal.

Same reason why discounts are offered to seniors and students, many retailers can't sell to those groups at market value so they discount in order to make the sale happen and move inventory.

Basic economics people! Google it, price discrimination, thats what this is about.

Also, one of the other writers makes a very good point about cash fares being far more susceptible to loss and many other maintenance expenses. I would further this point by noting that the CTA can make a lot of money over the long run by investing dollars deposited in Chicago Card accounts (values likely to be larger than "paper" cards) in corporate paper.

===
People who are too lazy to sign-up for it are price disciminated against... even if there was a $5 fee for getting one, would that dissuade you from buying one (considering the hundreds of dollars saved throughout the year)?
===

When the Chicago Card first came out, the fare was the same as the Transit Card. And the $5 fee would be enough to dissuade anyone who wasn't a daily commuter.

====
I would further this point by noting that the CTA can make a lot of money over the long run by investing dollars deposited in Chicago Card accounts (values likely to be larger than "paper" cards) in corporate paper.
====

Can they legally invest this money?

Remember that this money isn't counted as revenue until it's actually spent on a ride. Until then, it's a seperately accounted for current asset, with a coresponding current liablity.

I guess they theoretically could borrow against the current asset, and invest that money in something, but can they legally do that under current law?

As far as I know, Jewel cashiers will always give you the discount after you tell them you don't have a card. This extends to the self-checkout lanes, where you can ask the attendant to punch in the store's code. I haven't been asked whether I wanted a card in years and I can't remember goingt to a Jewel and not getting the discount. (And I can't speak to Domenick's because there aren't any in the last few neighborhoods I've lived in.)

In the meantime:

MK wrote: "I think you can figure out why they don't dispense them at rail stations. They have a very good reason for not doing so."

What is the reason?

Posted by: stillwaiting | October 13, 2008 at 06:02 PM

I answered that in the next sentence after the part you quoted.

Posted by: MK | October 13, 2008 at 06:39 PM

The next sentence was:

It's the same reason why they don't sell the Chicago Cards at the stations (although that reason will no longer exist if this fare equilization goes through).

So no, you didn't answer that; you just said the two reasons are the same. Care to enlighten us idiots?

I guess it is more accurate to say that it is the same as one of the reasons why they don't sell the Chicago Card at the stations. There are other reasons. But yes, Bob, I did state it. If someone mentions that they said something that answers a question and you don't see the answer below the question then I suppose the next thing to do would be to look above. It wouldn't neccessarally be immedietely above, but I would guess it would be a pretty good bet that it would be somewhere.

Yes, if you look annoyed at Jewel or CVS (not, from my experience, at Dominick's) about the fact that you are not getting a discount even though you don't have the card they will usually give it to you anyway. But I really would not want to go through that process every time I buy something. Do you? I guarantee you that if Jewel and CVS automatically gave me discounts whether or not I have the card then I wouldn't have got them. I remember specifically having reciepts from Jewel that stated "you would have saved X money with the preferred card". So if they just give discounts to everybody at your Jewel then that is unusual.

"It wouldn't neccessarally be immedietely above, but I would guess it would be a pretty good bet that it would be somewhere."

Heh.

Well, you said "the very next sentence," and now you acknowledge you have no idea where the answer is, just that you're pretty sure you mentioned it. Sometimes you remind me of a certain Vice Presidential candidate.

The resemblance continues with your next train of "thought," where you assume that I "look annoyed" when they ask for my card. Nothing could be farther from the truth; I don't really care if I save a few pennies or not, but I'm always politely grateful when they punch in their code after I say I don't have a card. Do you often "look annoyed"? Maybe they only do it for friendly people. But they've done it for years, and they've done it consistently; when the people in front of me don't have cards, they get the discount too.

I think the structure of the fare increase is deranged. Eliminating the Chicago Card bonus when so many people are still using cash or farecards is idiotic. And what amounts to more than a 42 percent fare increase for the CTA's most regular users is simply cruel.

The bottom line is that if this fare increase goes through, I will quit using the Chicago Card and go back to using cash. There's no reason for me to give the CTA personal information or have cash tied up on an instrument that fails periodically and is inconvenient to replace.

I simply cannot believe the number of posts here rationalizing this increase. If you want to see how a properly run transit system works, go and look at London, where an Oyster Card fare is £1.50 and a cash fare is £4.00. Do the "poor" there suffer? I think not, but partly because they can pick up an Oyster Card and get it replaced at any train station, without filling out a form, without any other invasion of privacy, and with the ability to reload it with cash, a debit card, or a credit card as they choose at any ticket machine. And if they want fare protection, they can register the card -- that's the only circumstance under which you give away any information. Now that's convenience.

And it gets better. Because the Oyster Card is "tap-in" AND "tap-out", it has the capability to combine journeys without a transfer charge and also calculate your lowest possible fare for the day (or week as the case may be), so between Underground (their 'el), and Overground (their Metra), both of which take Oyster, you're guaranteed the lowest possible fare under any circumstance, even retroactively. You take four or more rides in a day, at the end of the day it recalculates that as a day pass. And so on.

But here we're effectively talking about poking e-fare users in the eye and going back to dollar bills. Is that any way to run a transit system? No, but if I'm not given a reason to use Chicago Card, I won't use it.

The current lower rates for CTA card users reflect the lower costs they cause the system to incur. Those costs primarily relate to the handling of cash. The first day I get charged higher rater that are not cost justified, I will show up at the station with two rolls of pennies.

I don't give the cashier an annoyed look, but I don't beg either. I just tell them I don't do cards. If they want to give me the discount anyway they can do so. If they want to give me an argument, I'm less likely to come back to that store again.

Of course if the cashier tries to sell me a bag of jalapeno barbeque flavor potato chips, I'll give them an annoyed look. I don't know why Jewel makes them do this when they know we hate it. And I don't appreciate Dominick's putting me on the spot about some charity--I already have my favorites that I give to. Hey--at least the CTA personnel and fare machines are not doing this kind of thing to us...yet! Can you imagine? ;)

Well, whatever MK's intended point might have been, the fact of the matter is that the CTA does not sell its own passes at most rail stations. That's the main reason they don't sell as well as they might. The CTA has easy, cost-effective ways of fixing that, yet choses not to. Granted, they are a monopoly and so they can get away with being irrational some of the time without paying much of a price, but you'd think Huberman would aspire to more, based on his relatively good record thus far.

"Heh.

Well, you said "the very next sentence," and now you acknowledge you have no idea where the answer is, just that you're pretty sure you mentioned it. "

I think you know very well, Bob, that I was not indicating that I didn't know where I answered it. I was attempting to give a hint so you can find it for yourself. I did answer the question in the "very next sentence" when I said that the visitor passes are clearly not sold in the stations for the same reason as the Chicago Card. Having just posted a few hours earlier about the main reason why the Chicago Card is more difficult to get I really didn't think it was neccessary to repeat myself. I figured that most people would immedietely figure out that when I say "the same reason why the Chicago Card is not sold at stations" that I mean what I had just stated about the purpose of that card's distribution methods(which is what triggered the whole discussion about Jewel, which ironically you get into in the same post you express bewilderment at what I said). And I really do believe that most people did figure that out. But apparently not the two people posting about it.

The incentive was to get you to use the Chicago Card. Now that you're using it there's no reason to continue the incentive.

Ralph,

The level of ignorance in your comment is astounding. It shows a complete lack of understanding about the way things work. Apparently Ron Huberman has many of the same misconceptions as you. A customer purchases a product because he or she believes that its benefits outweigh its costs (costs are not just monetary and include such things as time or lack of convenience). Once a certain amount of people are enticed by these benefits to purchase the product it is not as if these people just automatically will continue to get this product for the rest of their life. If a company (or government agency like the CTA) takes away the reason for people to use a product it means that these almost everybody will no longer do so. This is just common sense and is something that everybody should intuitively know. I am completely baffled as to how Huberman could be so stupid as to actually think (as he seems to based on this fare equalization and his public comments) that the percentage of people who are Chicago Card users will just permantally be what it is now. It shows an astonishing level of naivity about the way the world works. I just don't understand it. Huberman doesn't seem to be as stupid as his decisions and comments about this display. Perhapss there is some other motivation behind this that we don't know about. If so, it probably is wise for Huberman to make this public so that he doesn't continue to come off as a complet bafoon. If Starbucks decided that from now on it will make its espresso drinks of less quality because "people are already purchasing them" and somehow believed that the demand would not dramitacally decrease they would be laughed at. This is exactly the same thing. Espresso customers and Chicago Card customers are not a permanant amount of people who once they started to use the product do no stop. It is not a constant variable like "blond haired people" or "females over the age of thirty-five". Everything Huberman has done publicly shows that he doesn't understand this.

Where in the world is the media? None of their coverage of the Fare increase has even remotely touched on this issue. They, like Huberman, seem completely confused as to why people use certain types of tickets. They have acted as if all of this is constant and have stated such things as "fares will go up between 25 and 50 cents depending on mode of payment". Crains Chicago Business was unbelievably misleading when it stated "for most riders, fares will go up 25 cents". As far as I'm concerned, this is a 67 cent fare increase. In the current system, the lowest fare possible is $1.58 ($1.75 minus 10% for the bonus). Now the lowest fare is $2.25. If we are not talking about the lowest fare possible, why do we even care about a fare increase? The people who will not attempt to get the cheapest fare obviously wouldn't care about it. The CTA won from the public relations standpount with the so-called fare increase in 2006. I didn't consider that an increase because the lowest fare possible did not change. Yet it satisfied some people, such as legislators and their constituants, who were complaining that the fare hadn't been raised in a while. Now it is getting another PR benefit from acting as if this is basically a 25 cent increase instead of a 67 cent increase. And, ironically, it will end up hurting the CTA because people will stop using the ticket that causes the most cost savings for the agency. Like I said, the fares obviously should be raised. But this is not the way to do it.

It seems like every article I read people only post the first day. There have not been a lot of follow up reports to the fare hike, the "public meeting" or the fact the board will decide on the 13th of November. Please write the board

ctaboard@transitchicago.com

My big gripe- aside from service, is all the money wasted by the CTA building under Gallery 37 because the Mayor wanted it done, even though the city has zero responsibility for funding the CTA- it is done through taxes it is not in the City's budget.

Chicago Business June 8, 2008. "the CTA in several stages over the past year or so has poured an extra $60 million to $70 million of its own money into the project, despite its shortage of capital funds," sources say.