The MBTA held its first public hearing Tuesday on the future of late-night service, which is on the chopping block as the transit agency looks for ways to reduce a projected $242 million deficit next fiscal year.

The T currently provides service until 2 a.m. on all subways lines and 10 key bus routes on Friday and Saturday nights. The service debuted as a pilot program in 2014 to much fanfare and continued in 2015 with some services scaled back.

But low ridership, high costs and a negative impact on maintenance have made the service “a real challenge” for the T to continue, MBTA assistant general manager Charles Planck said at Tuesday's public meeting.

“We’re facing substantial deficits at the MBTA and are evaluating all of the services we provide to determine how we can proceed and reduce operating deficits,” Planck said.

A couple dozen people attended Tuesday’s public meeting. Some of those in favor of keeping late-night service acknowledged the T’s need to cut costs, but said the service was important for the city's young population.

“I know they do need to make cuts, but I don’t think this is the right place,” said Logan Trupiano, a student at Suffolk University. “It might not affect the older population that much, but it really affects the college population.”

Late-night service costs the T about $14 million per year to operate. Planck said the service has a higher per passenger subsidy than service during regular hours — an average of $13 per late-night passenger compared to an average of $1.43 per passenger during regular hours.

“This is a per trip cost that is really unsustainable for the MBTA at present,” Planck said.

And ridership during late-night service has been declining since the service began, according to the T. Last year, an average of 13,000 riders used late-night service each night, down from an average of 16,000 nightly riders when the service launched in 2014 (That could be attributed to the scaling back of late-night service in June 2015 — when the T cut five late-night bus routes and started ending service 30 minutes earlier, at 2 a.m. instead of 2:30 a.m.)

Compare that to an average ridership of 72,711 at 5 p.m on weekdays, 33,271 riders at 3 p.m. on Saturday, and 14,562 riders at 5 a.m. on weekdays, according to the T.

Planck said providing late-night service also affects the T’s ability to perform maintenance by shortening the window of time workers have to make repairs — from five hours for normal weeknights to three hours on weekends.

“Access with tools and equipment to the site of rail jobs takes sometimes an hour to set up and an hour to take down in order to allow service to resume at 4:35 in the morning,” Planck said. “So it’s a real concern for us in terms of bringing the MBTA up to a state of good repair.”

The T is facing an estimated $7.3 billion state-of-good-repair backlog.

One of the expected benefits of the late-night service touted at its debut was that it would give people who work odd hours access to alternative transportation. But Planck said the T doesn't think the service does much for workers.

“We don't think that the 90 minutes we’re providing two nights a week is terribly significant in terms of economic impact and job access,” Planck said.

Late-night service is significant for Melissa Thomas, a student at Bunker Hill Community College who attended Tuesday’s meeting. She works as a waitress downtown and uses the late-night service regularly. She said her major concern is safety.

“I feel safer using the T because [I’m] in a big group instead of using taxis [or] Uber,” Thomas said, adding that she has had friends who have been attacked while walking home.

For Trupiano, the Suffolk student, safety is also a concern. He said getting rid of late-night service may put more inebriated students out into the streets, potentially leading to alcohol-related injuries or incidents.

“The T is the safest and most affordable way to get back to their apartments or dorms late at night,” Trupiano said during the hearing.

But others feel late-night service has a negative impact on their communities.

A life-long Boston resident who only identified herself as Marilyn said late-night trains are disruptive to people in her neighborhood. She lives in the Fields Corner area of Dorchester and said the trains run close to people's homes.

"It’s disrupting our sleep, so we’re not getting sleep and it’s affecting our everyday well-being as well as the functions that we need to do," she said, later adding: "You know when the train is running, you know when the train stops, you know when the train has snow ... People need to be able to rest and stay healthy and not have a negative impact on their health."

The T is required to do an equity-analysis of the service before it's cut. Planck said that analysis is still in progress, but initial findings show cutting the service would disproportionately affect minority and low-income riders.

In Tuesday's hearing, Planck outlined two options the T is considering for late-night service. One option is to completely eliminate the service, leaving late-night transportation up to taxis and ride-hailing services. Another option is for the T to request proposals from private providers to offer a comparable service at a lower operating cost. Planck said the T doesn't currently have a plan for what that type of service would look like.

When asked if there were more than two options, Planck said the T is open to considering "any alternative for how we might provide late-night service or organize late-night service in the future if it’s not directly provided by the MBTA."

This would mark the second time the T has experimented with late-night service and failed. The T started a late-night bus service called Night Owl in 2001, but it was cancelled in 2005 for budgetary reasons.

The T is holding another public meeting on late-night service Tuesday night. A third meeting is scheduled for Wednesday evening. Written comments will be accepted through Feb. 12 and can be submitted by email or regular mail (details here). The T’s fiscal control and management board will vote on what to do about late-night service at a later date.