Free Buses, Costly Lessons

State and Local Government |
By Scott Tanner | Read Time 2 minutes minutes

A recent paper arguing for fare-free buses in New York City reads like something we’ve already tried—and failed at—in Kansas City.

In 2020, Kansas City became the first major U.S. city to eliminate bus fares entirely. At the time, city leaders leaned on a slapdash four-page “mini report” that promised an $11 million local GDP boost. To put it mildly, it was wrong.

Since then, ridership dropped, assaults on drivers went up, and the Kansas City Area Transportation Authority (KCATA) is now staring down a $10 million budget gap. The COVID money that kept KCATA afloat runs out next year. KCATA’s new leadership is asking to study whether fares should return. That’s where we are now: back at the beginning, but with less credibility and fewer resources.

The New York proposal has the same weaknesses. The author estimates a 23% increase in ridership, a 12% increase in speed and billions in economic gains—all for the low, low cost of $600 million in forgone fare revenue. But his math is speculative, his benefits are theoretical, and like in Kansas City, the costs are very real.

The problem isn’t just financial. Prices matter. Fares aren’t only about revenue—they’re also a tool to manage demand, discourage misuse, and incentivize better service. Eliminate them and you get overuse, fewer behavioral constraints, and more wear on already stretched systems. You also change the customer’s relationship with the service. When it’s free, expectations fall—for riders and for the agency.

Proponents talk about fairness. But there’s nothing fair about asking everyone to pay for a system that primarily serves a few. The better solution is targeted subsidies for those who need the help, which would preserve incentives, protect the system, and respect taxpayers.

Kansas City tried fare-free transit. It failed. New York doesn’t have to make the same mistake.

About the Author

Scott Tanner joined the Show-Me Institute in July of 2013. He earned a B.A. in political science from the College of Wooster. Scott previously worked for the Mitt Romney campaign in Iowa during both the caucuses and the general election of the 2012 cycle. In between, he worked at the Iowa State House for a legislative session. Scott is primarily interested in fiscal and economic policy and considers the Show-Me Institutes mission one of crucial importance. Scott lives in the Central West End neighborhood of Saint Louis City.

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