Prohibition on universal fare free policies

Section 5323 of title 49, United States Code, is amended by adding at the end the following: (w) Prohibition on universal fare free policies (1) In general A recipient of assistance under this chapter may not provide a universal fare free policy that allows all users of a public transportation service provided by or on behalf of such recipient from using such service without paying a fare. (2) Exception Nothing in this subsection shall prevent an recipient described in paragraph (1) from providing a targeted fare policy that allows a certain group of riders to ride for free or reduced charge including for— (A) seniors; (B) low-income riders; (C) students; or (D) employees or members of an organization whereby use of such public transportation is paid for through an agreement between an entity and the designated recipient. (3) Waiver The Secretary of Transportation may waive the requirements of paragraph (1) if a recipient of assistance under this chapter is able to identify a dedicated source of operating revenue for such a universal fare free policy from a non-Federal source..