Cost Estimates and Revenue Options for Universal Fare-Free Bus Transit in Hawaiʻi
Executive Summary
Public transit connects people to opportunity: to jobs, school, medical care, and daily life. When we remove the cost of a fare and develop our transit systems with reliability and accessibility in mind, we can directly expand who can get where they need to go.
Hawaiʻi is one of the most expensive places to live in the United States. Housing, food, and transportation costs place enormous pressure on working families, and the burden falls heaviest on those with the least. In 2025, the public cost of the vehicle economy in Hawaiʻi was $14,400 per taxpayer, or $33,600 per household, regardless of vehicle ownership. The additional private cost of vehicle ownership is substantial—an extra $21,800 per household, per year.
Public transit offers a powerful alternative. A single transit trip costs a fraction of what a vehicle trip costs, and sustained investment in transit infrastructure generates substantial economic returns—an estimated $5 billion in GDP for every $1 billion in annual investment over 20 years.
Yet across counties, transit ridership varies significantly. Transit ridership on Oʻahu has yet to recover to pre-pandemic levels, and recent fare increases are making the problem worse. Hawaiʻi County tells a different story: after bus ridership fell from 663,784 passenger trips in FY2019 to 325,049 in FY2021, it not only rebounded but has since exceeded pre-pandemic level—a turnaround driven by the county’s shift to fare-free service.
Fare revenue covers only a small share of what it costs to run Hawaiʻi’s bus systems. On Oʻahu, fares cover roughly 15 percent of TheBus’s operating costs, with the remaining 85 percent already funded through public revenue regardless of what riders pay.
In February 2026, Hawaiʻi Appleseed released “Keiki Ride Free,” a policy report recommending that Hawaiʻi enact statewide legislation to provide free transit for all residents age 18 and under. This report builds on that foundation, estimates the cost of a universal fare-free bus transit program, and identifies funding sources the state can use to pay for it.
A universal program does not replace Keiki Ride Free, rather it is a broader version of the same goal. Cost estimates provided in this report are broken out by both county and rider age group to preserve that option.
We estimate a statewide universal fare-free bus program would cost approximately $62.4 million annually in the near term, assuming 10 percent utilization on Oʻahu and 5 percent on neighbor islands. Hawaiʻi County’s Hele-On program, which has already been fare-free since 2022, adds no additional cost.
This report focuses specifically on public bus transit, not rail or paratransit. The report does not recommend fare-free access to Skyline in the near-term: the system is still in active construction and its operating picture is not yet settled, so we recommend revisiting rail integration in a future report.
Hawaiʻi Appleseed recommends:
Enacting statewide legislation establishing a permanent, universal fare-free bus transit program;
Funding it through the barrel tax, the Clean Fuel Standard (SHIFT), or the State Highway Fund, distributed to counties by formula;
Requiring county transit agencies to report ridership, cost, and utilization data annually; and
Investing in service improvements alongside fare elimination.
