What level of punishment should somebody who is trying to move between place to place receive for their lack of paying $1-3? The service was already going to operate, regardless of their lack of payment.

Some public transit has a much more rigid fare collection structure - trains are typically much more controlled entry points. But buses? It's in their best interest to get everyone on as quickly as possible and get everyone off as quickly as passive. Are you going to have gates that block you if you don't scan your card/phone from exiting? Same for boarding. Do you dedicate policing resources to ensuring the collection of what is certainly less than the cost to employ the police officer? Seems wasteful until you hit a very high ridership.