While the transportation industry seeks to move people and product across the nation, New Jersey has indicated that some of its provided bus and rail lines are not profitable enough to maintain. Three bus routes will be shut down beginning September 30th, and others will only operate during heavy traffic times. Although these routes are being modified, NJ Transportation Liability is increased as the market is likely to become more competitive.
Bus route 655 between Princeton and Plainsboro, route 307 between Freehold and Great Adventure, and 318 between Philadelphia and Great Adventure, will be discontinued as of the end of this month, according to NewJersey.com. These route closures are a result of the realization that the operating costs of the lines far exceed the fares received from using them. For example, some of the biggest losing lines’ fares only cover an estimated 5 percent of the total cost.
In addition, other lines such as the 872, 419 and the 463 will have limited number of stops or lose late night service altogether. What’s more, a 9 percent fare increases is also taking effect on October 1st to accommodate these changes.
According to NJ.com, the 655 was the fourth worst performing route in the state in 2014, with fares only covering 4.4 percent of the total operating costs. The routes are evaluated four times per year and the best lines’ fares cover up to 48 percent of operating costs.
NJ Transit spokeswoman Nancy Snyder stated “The agency makes necessary adjustments to service, such as frequency of service, the span of service within the service day and route modifications long before considering a discontinuation of service.” In other words, the closure of the above mentioned routes is the last resort for remedying the hefty loss of state revenue.
At Tri-State Insurance Agency, we specialize in the transportation industry. Our coverage options safeguard a variety of risk exposures that are unique to the industry. For more information, we invite you to contact our knowledgeable specialists today at (888) 990-0526.