Local Fare Flexibility & Visitor Contribution Policy (LFFVCP) — Hamilton Pilot

1Cabinet Paper

Title: Local Fare Flexibility & Visitor Contribution Policy (LFFVCP) — Hamilton Pilot

Purpose

To seek Cabinet agreement to enable public transport authorities (PTAs) to set resident‑verified micro‑fares and Visitor Contribution Fares (VCFs) on nominated routes; to direct Waka Kotahi NZ Transport Agency (NZTA) to support residency verification and fare rules in the National Ticketing Solution (NTS); and to approve a 12‑month pilot in Hamilton (CBD ↔ Hamilton Zoo corridor).

Proposal

• Agree in principle to a targeted change under the Land Transport Management Act 2003 (LTMA) to explicitly permit resident/visitor differential fares through Regional Public Transport Plans (RPTPs) and contracts.
• Direct NZTA to update RPTP guidance and configure NTS functionality for residency flags, library‑card linking, and resident/visitor fare rules with a published Privacy Impact Assessment (PIA).
• Approve a 12‑month Hamilton pilot on the Visitor Destinations Corridor (Transport Centre ↔ Hamilton Zoo on Route 3, Dinsdale): Resident Micro‑Fare of 10¢; Visitor Contribution Fare of $10.00; optional two‑hour visitor pass.
• Require quarterly reporting on patronage, equity impacts, net VCF revenue, and the pass‑through to Hamilton City Council (HCC) for visitor‑asset debt service.

Executive Summary

Councils face affordability pressure while needing mode shift and better access to visitor destinations. The LFFVCP lets PTAs keep fares ultra‑low for verified residents while asking visitors to contribute more where a corridor predominantly serves visitor assets (e.g., the Zoo). The approach aligns with the Sustainable Public Transport Framework (SPTF) and the Government Policy Statement emphasis on growing farebox/third‑party shares. The Hamilton pilot aligns roles (WRC as PTA; HCC as destination owner) and delivers transparent reporting and ring‑fenced visitor contributions.

Background

Under the SPTF, PTAs plan, procure and set fares via RPTPs and contracts. NZTA is rolling out the NTS (Motu Move), including account‑based fare rules and open‑loop payments. Hamilton Zoo is served by BUSIT Route 3 (Dinsdale), making it a practical first corridor for a resident/visitor fare trial.

Problem / Opportunity

Residents benefit from affordable everyday mobility; visitors value easy, direct access to attractions and can reasonably contribute more to local costs. Differential pricing by residency (not nationality or race) is feasible but not explicit in statute or guidance. Making it explicit reduces legal risk and accelerates adoption.

Objectives

• Keep local PT affordable for residents (10‑cent micro‑fare) without eroding service viability.
• Recover a meaningful visitor contribution on attraction corridors (net‑positive revenue after costs).
• Protect equity (retain national concessions; publish distributional analysis).
• Maintain privacy and consent‑based verification via NTS and local identity (e.g., library card).

Preferred Option

Amend LTMA (or make regulations and guidance) to expressly permit residency‑verified fares and VCFs in RPTPs, with ring‑fencing of net VCF for visitor‑asset costs via PTA↔TA agreements. Pilot in Hamilton on Route 3 to the Zoo.

Fare settings (pilot)

• Resident Micro‑Fare: 10¢ per boarding for NTS accounts flagged “Resident—Hamilton” or accounts linked to a Hamilton Libraries card.
• Visitor Contribution Fare: $10.00 per boarding; optional $14 two‑hour visitor pass to avoid transfer penalties.
• Concessions: national/regional concession entitlements remain equal or better than status quo.

Verification and privacy

NTS residency flag with user consent; one‑time library‑card link; publish PIA summary; data minimisation and short retention windows.

Legal and Human Rights

The Human Rights Act 1993 s21 does not list place of residence as a prohibited ground of discrimination. Pricing by residency (applied neutrally) is permissible, subject to standard equity and consultation tests. LTMA provides the framework for RPTPs and fare setting; an explicit enabling clause for resident/visitor differential fares will provide certainty.

Te Tiriti o Waitangi / Māori

RPTP variation consultation to include mana whenua and Māori partners. The pilot supports affordable access for resident whānau and reduces parking pressure near visitor destinations.

Financial Implications

Hamilton City Council’s audited 2023/24 Annual Report records: Interest on borrowings $54.841m; Total finance costs $59.310m; Net debt at 30 June 2024 $923m. The pilot’s net VCF will offset a small but meaningful portion of visitor‑asset debt service without increasing ratepayer burden.

Regulatory Impact

The proposed targeted amendment/regulation has low compliance cost, aligns with SPTF flexibility, and can be supported by NZTA guidance and NTS configuration.

Implementation

1. Q1: Cabinet in‑principle; MoT/NZTA draft LTMA enabling text and guidance; initiate NTS configuration and PIA.
2. Q2: WRC publishes RPTP variation for consultation (corridor, fares, equity analysis, privacy summary).
3. Q3: Contract updates, signage and comms; pilot go‑live; quarterly monitoring to Ministers and Councils.

Risks and Mitigations

• Tourism elasticity: mitigate with day‑pass and family bundles.
• Equity: retain national concessions and publish distributional analysis.
• Privacy perception: publish PIA summary; opt‑in verification; robust complaints process.

Recommendations

1. Note the problem and opportunity outlined in this paper.
2. Agree in principle to enable resident/visitor differential fares via LTMA and guidance.
3. Direct NZTA to support residency verification and fare rules in NTS, with a PIA.
4. Approve the Hamilton Zoo Corridor pilot for 12 months, with the fare settings described.
5. Invite the Associate Minister of Transport to report back after two quarters on progress and net VCF delivered to HCC.

Annex 1 — Indicative Enabling Text (LTMA)

Resident and Visitor Differential Fares

1. Authorisation. A public transport authority may, in its regional public transport plan and related contracts, set differential public‑transport fares for residents and visitors on specified services or corridors.
2. Verification. Residency may be verified using approved instruments (including the National Ticketing Solution account attributes or local authority identity such as a library card), on a consented, privacy‑compliant basis.
3. Equity and consultation. The authority must (a) consult through the RPTP process; (b) demonstrate no disproportionate adverse effect on protected groups; and (c) maintain eligibility for national concession frameworks.
4. Ring‑fencing (optional). An RPTP may provide that net revenue from Visitor Contribution Fares on visitor‑destination corridors be applied to visitor assets (including debt‑service costs) under an agreement between the PTA and a territorial authority.

Annex 2 — Fare‑Rule Extract (NTS)

Token types: NTS Card / Mobile token / EMV (open loop) / Paper QR (visitor).
Attributes: resident_flag ∈ {HCC_resident, none}; concession_profile (child, youth, CSC, disability, etc.); cap_status.

Rule order (tap‑in):

1. Apply concession entitlements.
2. If resident_flag == HCC_resident → Fare = $0.10.
3. Else → Fare = $10.00 (or validate visitor day‑pass within 120 minutes).
4. Apply transfer policy (resident: free within 60 minutes; visitor: covered by pass).

References

• Human Rights Act 1993, s21 (prohibited grounds).
• LTMA, SPTF and RPTP guidance (Waka Kotahi).
• National Ticketing Solution (Motu Move) programme updates.
• BUSIT Route 3 (Dinsdale) — serves Hamilton Zoo.
• Hamilton City Council Annual Report 2023/24 (finance costs and net debt).

2RPTP Variation — Hamilton Visitor Destinations Corridor (Pilot)

Amendment Overview

Waikato Regional Council proposes a 12‑month pilot on the Visitor Destinations Corridor (Transport Centre ↔ Hamilton Zoo via Route 3, Dinsdale) introducing: (a) a Resident Micro‑Fare of 10¢; and (b) a Visitor Contribution Fare of $10.00 (with an optional two‑hour visitor pass).

Policy Rationale

Support affordable access for Hamilton residents, encourage mode shift to visitor destinations, and generate a transparent visitor contribution that is ring‑fenced to offset visitor‑asset debt service at Hamilton City Council.

Classification

The Corridor is classified as an integral public transport service under the LTMA and Waka Kotahi RPTP guidance.

Fare Policy

Resident Micro‑Fare

10¢ per boarding for NTS accounts flagged “Resident—Hamilton” or accounts linked to a valid Hamilton Libraries card.

Visitor Contribution Fare

$10.00 per adult boarding; optional $14 two‑hour visitor pass valid network‑wide to avoid transfer penalties.

Concessions

Existing national/regional concession entitlements remain equal or better than current settings.

Verification & Privacy

NTS residency flag (opt‑in, consent‑based) and one‑time library‑card linking. Publish a PIA summary, with data minimisation and short retention periods.

Contracts & Funding

Operator contracts updated to include resident/visitor fare rules. After operator and ticketing costs, net VCF is transferred from WRC to HCC under a Heads of Agreement for visitor‑asset debt service. Quarterly reporting to both councils.

Consultation

Statutory RPTP consultation including mana whenua, disability advocates, tourism/hospitality stakeholders, residents, and businesses. Publish an equity assessment and a privacy summary.

Monitoring & Evaluation

• Ridership (resident vs visitor) and occupancy.
• Net revenue (gross visitor fares minus costs).
• Equity impacts and customer satisfaction.
• Parking/traffic conditions near the Zoo.
• Net transfer to HCC for visitor‑asset debt service.

Implementation Timeline

1. Month 0–1: Council resolution to notify RPTP variation; consultation documents released.
2. Month 2–3: Consultation; analysis; council adoption of variation.
3. Month 4–5: Contract variations; NTS config; comms and signage.
4. Month 6: Go‑live; begin quarterly public reporting.

Schedules

Schedule A — Fare Rule (extract)

1. Apply concession entitlements.
2. If resident_flag == HCC_resident → Fare = $0.10.
3. Else → Fare = $10.00 or validate visitor pass.
4. Transfers: resident free within 60 minutes; visitor pass covers transfers within 120 minutes.

Schedule B — Heads of Agreement (key terms)

• Purpose: pass‑through of net VCF to HCC for visitor‑asset debt service.
• Reporting: quarterly ridership, revenue, costs, and net transfer.
• Review: tied to pilot evaluation or legislative change.

References

• BUSIT Route 3 (Dinsdale) — Transport Centre to Hamilton Zoo.
• Hamilton Zoo — “Public transport” visitor information.
• NTS (Motu Move) rollout updates.
• Human Rights Act 1993, s21; LTMA — RPTP framework.
• HCC Annual Report 2023/24 — finance costs and net debt.