Rides on the Las Vegas Monorail will cost more for visitors and less
for locals under a new fare structure being rolled out in the coming
weeks, which officials hope will help the rapid transit line finally
break even financially.
The existing $3 base one-way fare will grow to $5 as of Dec. 29,
while a $1 fare for Southern Nevadans who pre-purchase tickets goes
into effect Jan. 1, Curtis Myles, president and CEO of the Las Vegas
Monorail Co., said Wednesday.
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The moves are aimed at helping get total monorail revenues that now
hover around $90,000 per day to match the roughly $159,000 needed to
cover the $650 million rapid transit line's daily operating costs
and debt service in 2006.
That budget gap led the privately-built monorail to suffer an
estimated loss of more than $20 million this year. That amount was
covered by cash reserves.
"We'll have peaks and valleys through the year, but we'll meet
targets," Myles said. "By the end of 2006, I hope to say we're self-
sufficient, and have a bit of cushion."
Officials are betting that the fare hike, when combined with an
expected 11 percent increase in ridership, will result in a 63
percent jump in farebox revenues.
Myles said the percentage increase is based, in part, on increases
seen in the same months in different years during the monorail's
brief time open to the public for parts of 2004 and this year.
That jump also takes into account a loss of some riders due to the
fare hike.
"There is an expectation that we'll see, as a result of the fare
increases, some decrease in ridership," Myles said. "We expect to
increase ridership from marketing efforts. Hopefully, the two will
offset.
"There's a certain amount of discretionary dollars" that visitors
carry with them, Myles said. "You can absorb price increases
(better) with those discretionary dollars than if you're not a
visitor."
Earlier, financial analysts tracking the monorail's bonds said
transit systems usually suffer ridership slumps when fares go up,
but the monorail was less susceptible because of free-spending
tourists making up its customer base.
But analysts warned that a fare hike could not be so extreme that it
would make the four-mile monorail line behind the Strip less
competitive against cabs.
At current rates, a four-mile cab ride in the Las Vegas Valley costs
$11.20 for non-airport trips. And a one-way base fare on "The Deuce"
Strip bus route costs $2.
In addition, on one-way fares, multi-ride passes are also seeing
price increases Dec. 29. A ten-ride pass now costing $20 will be
$35; a one-day pass costing $10 will go to $15; and a three-day pass
costing $25 will be $40. A new two-ride pass will be created,
costing $9.
According to the monorail's 2006 budget, the fare increases will
allow the system to take in over $134,000 in fares from almost
32,000 riders each day next year, compared to around $82,000 on just
under 29,000 daily riders in 2005.
At the same time, officials expect nonfare revenues such as net
advertising receipts, concessions and other revenue streams to
explode, producing around $23,000 each day in 2006, up from just
$7,000 daily this year, thanks in part to anticipated new
sponsorship deals.
If the forecasts prove optimistic, the monorail is not in short-term
danger of default. Myles said if revenues remain at 2005 levels, the
system has enough cash reserves to pay its bills into 2008.
Myles said he hopes the fare drop for locals will encourage Strip
workers to try or keep using the system as part of their daily
commutes.
Initially, discount tickets will not be available at monorail
stations, where tickets are vended by automated machines that are
not now set up to confirm a rider's residency.
Instead, discount passes will be sold at Citizens Area Transit bus
stations throughout the valley, where customers can show a state
driver's license, ID card of sheriff's card.
Locals can then bring the discount passes with them to monorail
stations.
$10 roundtrip, almost the same as cab. This is absurd. And they
raise the rates 4 days before CES. I hope you enjoy the traffic jams
around the convention center. This project caused untold headaches
while it was being built on Koval, Paradise and Sands. It is
basically a total waste of money. I have ranted about this before
but you have this big project and now they are drastically raising
the rates. It was never built for locals so the reduction for them is
meaningless.