The increasingly widespread implementation of smart farecards makes implementing variable pricing far easier and more reliable than in years past. As smart cards become more ubiquitous, will transit systems gradually reverse course and begin implementing differentiated fares? Will political and institutional resistance to variable pricing hold firm, suggesting that implementation was never the principal obstacle? Or have flat fares become so thoroughly inculcated in transit practice that most transit managers are unaware of the now decades old research on the benefits of differentiated fares? This report explores these questions. 

To better understand motivations for fare changes and the potential for implementing marginal cost pricing, the report reviews the literature on transit fares and pricing, conducted indepth interviews with California transit officials, and administered a nationwide survey of transit agency CEOs, planners and analysts, and board members on the goals that shape fare policies.