Dismayed Metro board members learned yesterday that a proposed year-end fare increase is expected to cut the system's already sagging ridership even more. Also, it may require 10-cent bus transfer charges and an end to discounts of flash passes and on rush-hour fares for the elderly and handicapped.

The roughly 10 percent bus and rail fare increase, which could go into effect as early as Dec. 5, was tentatively approved by the board May 23 as part of Metro's 1982 budget. It would be the third major increase in a year and a half.

Yesterday, however, when the board was finally presented by its staff with four plans for implementing the increase, members said they were shocked at the ridership projections and other implications of the increase, which is designed to raise $7.3 million between December and next June 30 -- the end of the 1982 fiscal year.

"We're at a crossroads . . . The buses are losing riders," said board member Marie Travesky of Fairfax County. She said that if fares increase again, her county will be "tied up" with traffic as people return to communting by car.

"We just can't keep going up and up," said the Rev. Jerry A. Moore Jr., a board member from the District of Columbia. "We've come to the point already where low-income people aren't riding the system."

"In the rush to raise revenue we are pushing our fare so high we are hurting ridership," said Metro General Manager Richard S. Page.

But the system needs that $7.3 million to meet rising costs and so yesterday Page and his staff offered four possible approaches to implement the fare increase, which could go into effect Dec. 5 to coincide with the opening of the Red Line subway extension from Dupont Circle north along Connecticut Avenue to Yuma Street NW.

All four approaches, which were taken under consideration by the board for possible action on Aug. 13, contain the bus transfer fee and end flash pass discounts and rush hour reductions for the elderly and handicapped.

The differ in their base fare changes. Under one, the base fare would remain 60 cents but with dramatic increases for longer distance travel. Another would jump the base fare to 75 cents but impose lesser increases for long distance travel. In the two in-between scenarios, the base fare would jump to 65 cents, with various combinations of charges for mileage.

The bulk of the needed revenue would come from those changes, with lesser amounts coming from the following:

Adding the 10-cent bus transfer fee, which Page said would affect about one-third of bus riders. He said it is aimed at stopping the "giveaway" in which people who can't use their transfers pass them on to others, and would rasie $1.3 million during the last seven months of fiscal year 1982.

Eliminating the 50-cent to $2.50 flash pass discounts, which would affect about 45,000 riders. Page said he thinks people will still buy the passes for their convenience. This measure would raise an estimated $682,000 during the last part of the fiscal year.

Eliminating rush-hour discounts for the elderly and handicapped, which is projected to force about 2,000 such people to change their hours for riding the bus. Another 8,000 won't change because they are on work trips -- but Page said if they are on work trips then it is not sensible to give them a discount anyway.On rail, 2,700 of the 5,800 elderly and handicapped who use the system are on work trips, Metro officials estimate. The change could raise $365,000 during the last part of the fiscal year.

The problem is that ridership is expected to drop by as much as 1.7 percent under the varying approaches, according to the staff estimates.

Page and other Metro officials said that systemwide fare increases on July 1, 1980, and Jan. 1 this year were among the factors causing ridership to drop in the year ended last June 30 for the first time since 1973. Other factors included cutbacks in service and problems of reliability and comfort, such as screeching brakes.

The drop was slight -- 2.4 percent for bus and rail combined -- but still shocking coming after years of dramatic increases. Transit ridership jumped 42.6 percent here from the subway's 1976 opening through June 30, 1980.

Bob Pickett, head of Metro's financialf and transit analysis branch, said rail ridership is now about the same as it was a year ago while bus ridership is down about 6 percent. Part of the at decline in bus ridership is due to people changing to rail as the rail system grows toward its 101-mile goal.

"We'll meet the revenue goals one way or another, either by reducing service or raising fares or some combination of those," said board Chairman Joseph Alexander.

But members of the planning staff immediately told him in yesterday's board meeting that service has already been trimmed so much that it may be hard to cut it further. "If we cut service, we'll cut a lot more riders," Pickett said.

Alexander suggested that the money might be raised if local jurisdictions could agree to pass a major regional transit tax. There was some discussion of this, but it is a notion that local politicians have resisted in the past.