Multimodal Fare Payment Integration (2020)

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5 Overview of Multimodal Payment Convergence 1.1 Background and Synthesis Objectives Multimodal payment convergence is the ability to use the same payment media or technol- ogy to pay for services on multiple modes of transportation—which provides a more seam- less and convenient experience for users. A nationwide trend toward multimodal payment convergence has emerged in large part because of technological change and the addition of new services: • As technology evolves and new payment solutions are introduced, transit agencies are looking for ways to adapt and find the most effective means to upgrade fare systems and introduce new capabilities. • Users have more choice than ever before, with new services such as shared bicycles and scooters and ride hailing—all enabled by real-time data. As more of these options are deployed, users expect the ability to locate these services and to pay for them in an efficient manner. Agencies are interested in ways to more seamlessly integrate the user payment experience between their more traditional modes (rail, bus, ADA paratransit, parking, and tolling) and modes typically provided by private companies to meet user travel patterns and expectations, which are increasingly multimodal and powered by real-time data. As mobile and communication technologies improve and new payment solutions become available, agencies are adopting a variety of payment technologies. The emergence of contact- less cards, mobile payments, and account-based ticketing systems paired with legacy ticketing systems creates new opportunities but also introduces new challenges for systems integration and interoperability. These technological trends have pushed transit agencies to adapt, with many focusing on how to achieve multimodal fare payment convergence. Multimodal fare payment convergence has been popularized through both high-profile U.S. agency system upgrades and influence from international experience. Multimodal fare payment convergence projects are typically techno- logically complex, include many stakeholders, and necessitate a thorough understanding of and agreement on operational coordination between agencies and stakeholders. This synthesis includes a snapshot of the current state of practice in the United States on multimodal fare payment convergence, along with case examples that provide insight into the following: • Different types of payment convergence and how they are used in transit systems, • Opportunities, benefits, challenges, and issues related to payment convergence, • Strategies, actions, and procurement methods used to define, evaluate, develop, implement, and maintain multimodal payment capabilities, C H A P T E R 1

6 Multimodal Fare Payment Integration • Initiatives that enable multimodal payment convergence such as application programming interface integration, • Transit systems’ methods for building consensus around payment integration after identi- fication of outside parties, • Provision of cross-program incentives across identified groups such as seniors, students, and customers with disabilities, • Transit agencies’ handling of issues of equity and accessibility when multimodal payment integration tends to focus on noncash solutions, • Approaches to data management policies, and • Future trends in fare payment collection. The intended audience of this synthesis report is policy makers, managers of transit agency fare collections systems, and transit service providers who want to achieve multimodal payment convergence with transit agencies. This synthesis includes information on the state of the practice in the United States and may also be of interest to transit agency personnel who are looking to achieve multimodal payment convergence or are actively working on fare technology projects that address these issues. After reading this synthesis report, public agencies should have a better understanding of the various approaches that other agencies have deployed to achieve multimodal payment convergence, and may have considerations that are applicable to their unique circumstance. 1.2 Methodology, Approach, and Report Organization This synthesis comprises three main elements: a review of existing research, an industry survey, and in-depth case examples (featuring both U.S. and international experiences). The review of existing research and literature is designed to be broad, relying not only on published reports but also on news articles, self-published agency materials, and industry news sources. Because of the fast-changing nature of multimodal payment convergence projects, a broad literature review is necessary to capture the latest information. The industry survey was conducted online and sent to 46 agencies across the United States. Thirty-six agencies, representing 19 states and the District of Columbia, responded to the survey. Topics addressed in the survey include the following: • Agency characteristics, including fare payment systems and payment convergence, • Approach to implementing new fare payment systems, including identifying payment convergence opportunities, • Anticipated benefits of payment convergence, • Equity and accessibility issues resulting from working with private parties, • Data sharing and usage, and opportunities resulting from working with private parties, and • Regulatory considerations. For more details about the survey—including the questionnaire itself and the list of respondents—please see Appendix A and Appendix B. To supplement the survey and provide a richer discussion on the topic, this synthesis includes case examples of six agencies or cities focusing on these entities’ approaches to multi- modal payment convergence. The Los Angeles County Metropolitan Transportation Author- ity, Regional Transportation District of Denver, and Port Authority of Allegheny County (serving Pittsburgh) illustrate three ways to achieve payment convergence without overhauling the current system. The experience of the Bi-State Development Agency in St. Louis illustrates opportunities and challenges for medium-sized agencies. Translink, the operator and transac- tion processor of the nationwide fare collection system in the Netherlands, is an international

Overview of Multimodal Payment Convergence 7 example that illustrates a different approach to payment convergence. The City of Antwerp’s experience implementing Mobility as a Service (MaaS) highlights challenges faced by a public authority in coordinating the development of MaaS. This synthesis report is organized into five main chapters. • Chapter 1—Overview of Multimodal Payment Convergence is a summary of the background, synthesis objectives, methodology, approach, and report organization. • Chapter 2—History, Context, and Technological Change is an overview of the history, con- text, and technological changes underpinning fare payment systems. The literature review examines published papers on the topic and self-published information provided by transit agencies. • Chapter 3—Status of Payment Convergence in the United States describes the current state of the practice for transit agencies related to payment convergence based on survey data. • Chapter 4—Case Examples contains six case examples illustrating different ways that agencies and cities have achieved or are currently working on payment convergence. • Chapter 5—Conclusions and Further Research summarizes the findings of this synthesis and identifies potential areas for future research. At the end of the synthesis are References, Glossary, Abbreviations and Acronyms, Appendix A (survey), and Appendix B (list of survey respondents).