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City of Frankfurt shows alternative forms of public transport financing

Frankfurt Hauptbahnhof - tramway | © UTM/b

Study analyses instruments for public transport financing – employer contribution recommended

In times of tight public budgets, new financing potentials are needed. traffiQ, the public transport company of the city of Frankfurt am Main, has commissioned a study to explore and evaluate possible financing instruments and potentials. The results of this study were presented by Frankfurt’s Head of Mobility, City Councillor Wolfgang Siefert, on Monday, 20 November 2023. “Strengthening local public transport, i.e. encouraging more people to switch to public transport, is the common goal of the state government and the City of Frankfurt am Main. In order to be able to offer a well-developed network with modern and comfortable vehicles and stops, sufficient, reliable funding is required. The City of Frankfurt am Main subsidises local public transport with over 200 million euros per year. Nevertheless, more funds are needed from the federal and state governments, or we must be enabled to tap into alternative funds,” says Siefert.

The management consultancy civity, which was commissioned to carry out the study, analysed six instruments of so-called “beneficiary financing”. This means that in future, companies or individuals who benefit from the good public transport service in Frankfurt without using it themselves will also make a contribution. “Of the six instruments that we have analysed for beneficiary financing of public transport, our current assessment is that all of them can make a contribution to the transport transition. However, the employer contribution and congestion charge offer particularly high potential for financing public transport. The employer contribution clearly stands out due to the ease with which it can be implemented by means of a legislative amendment at state level. Added to this is the incentive for local companies to use a job ticket,” summarises study director Friedemann Brockmeyer from civity.

Frankfurt underground | © UTM/b

The employer’s contribution would be levied in the form of a monthly charge on companies based in the city. It is based on the number of employees in the respective company. If the employer provides its employees with a job ticket, this is offset against the employer contribution. In the calculations, the study envisages charging a contribution of two euros per employee per week. Companies that provide their employees with a job ticket would be charged one euro per employee per week. In addition to incentivising the use of job tickets, the study estimates that this would generate revenue of around 65 million euros per year. The other five instruments analysed are the CityMaut, which would generate around 47.6 million euros per year. An expansion of car park management would generate 7.7 million euros per year. A guest contribution, which would be levied per overnight stay and would go hand in hand with a travel authorisation for public transport, would generate 3.8 million euros per year. 2.9 million euros per year could be generated via the car park charge. Urban development contracts, i.e. the participation of investors or property owners in the vicinity of new residential areas in the costs of a direct public transport connection, would bring in one million euros per year.

“The employer contribution is one way of financially mastering the challenges of the coming years and decades in public transport. In addition to capacity and network expansion, such as the extension of the underground lines U4 and U5, the Ring tram, network improvement and increasing the attractiveness of jobs for drivers in order to counter the shortage of skilled workers,” summarises traffiQ Managing Director Prof. Dr.-Ing. Together with city councillor Siefert, he emphasises: “The employer contribution is an effective, easy-to-implement lever for good financing of public transport.”

A legal basis is required at state level to enable the city of Frankfurt am Main, as well as other cities, municipalities and districts in Hesse, to implement this instrument by means of statutes and thus make another important contribution not only to the consolidation of public transport funding, but also to the expansion of public transport in Hesse.

“The employer contribution can be an important contribution by those who benefit from good and future-oriented public transport. This will benefit them and everyone else. We call on the incoming state government to implement the legal basis as quickly as possible,” concludes Siefert.

The complete study is available (in German language) at: https://www.traffiq.de/traffiq/medien/veroeffentlichungen.html .

(Info: traffiQ)