Expanding Muni's Kids Ride Free program to include 18-year-old low- and middle-income youths would cost an additional $1.1 million a year, while eliminating income limits altogether would nearly double the $3 million annual cost, according to a new city report being released as the transit agency considers whether to continue the pilot program at all.

City officials could cover the increased costs by raising the sales tax, imposing a special tax on private shuttle buses that use city property, or establishing a local vehicle license fee, according to the report by the Board of Supervisors Budget and Legislative Analyst.

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The report was requested by Supervisor David Campos, who pushed for the pilot program established in March. It allows San Francisco kids between the ages of 5 and 17 whose parents make less than the Bay Area median - $103,000 for a household of four - to ride Muni for free through June of this year.

About 78 percent of the estimated 40,000 eligible young people have registered for the program, the report said.

The pilot project for what's also known as Free Muni for Youth has not been nearly as expensive as Muni officials estimated when they were debating the program two years ago. The program itself costs about half of what Muni officials initially projected, he said, and it has not led to an expensive increase in service, the report found.

The Municipal Transportation Agency should make the program permanent and consider including 18-year-olds who meet the existing income requirements, Campos said, since many young people turn 18 while they are still in high school.

"I think this report confirms what we have been hearing - the program has been a resounding success," Campos said. "I think the report gives a lot of policy reasons for continuing the program and, if anything, we need to consider expanding it to include 18-year olds."

Continue or change

Over the next two months, the MTA's Board of Directors will decide whether to continue or change the $2.9 million program next fiscal year as part of its larger budget debate.

The board is holding its first public hearing on the proposed MTA budget Tuesday at 1 p.m.; it will approve a budget by the end of April and send it to the supervisors, who can accept or reject but not alter the proposal.

Paul Rose, an MTA spokesman, said the agency appreciates the analysis of the free Muni program and will consider its findings as the board works to adopt a budget.

In the report, the analyst considered a number of alternatives to the current setup, including a $1.3 million price tag to expand the program to include 18-year-olds who meet the current income requirement.

If Muni was to offer free rides to all youths ages 5 to 17, regardless of income, it would cost the city an additional $2.3 million annually. If the income requirement was scrapped and the age was expanded to include 18-year-olds, the annual price tag would increase by another $1.4 million. All told, expanding the program to include all city residents between ages 5 and 18 would cost the city $6.7 million a year.

40,000 kids helped

Bob Allen, transportation justice director at Urban Habitat - an advocacy group for low-income communities - said the report shows how wildly successful the first year of the program has been. He cited the high level of participation and low cost as reasons the free ride program should be made permanent and expanded to include all youths.

"We are talking about (almost) 40,000 kids, and this is beyond school, this is helping them get to after-school programs, to jobs - it's not just replacing the old school bus service," Allen said. "The impact of this investment is huge. You will hear from some people, 'We can't afford this,' but how can we afford not to invest this small amount?"

As families in San Francisco are squeezed by increasing housing prices and other rising costs, he said, this is an easy, inexpensive way to make the city more affordable. The budget being considered by the MTA is $915.4 million for the year that starts July 1.

"You can't build housing in a day, but this is an instant benefit," he said. "We are creating the next generation of transit riders - I can't think of a better way to do that than by making this permanent and hopefully expanding it."