Memorandum

City of Lawrence

Public Transit

 

TO:

Dave Corliss, City Manager

 

FROM:

Cliff Galante, Public Transit Administrator

 

CC:

Debbie Van Saun, Assistant City Manager

 

Date:

April 12, 2007

 

RE:

2008 Budget Request

 

Presented herein is the 2008 Detailed Budget Request, Capital Outlay Request and supporting documents that provide detailed information concerning anticipated Federal and State grant funds to be received in 2008 and how they will be used.

 

The Public Transit Department over the next year will focus on:

 

Ø      Reissuing a Request for Proposal for contracted transportation provider services to operate transit service beyond 2008 since the current contract will expire on 12/31/08.

Ø      Further coordination with the University of Kansas transit services to improve mobility options for the community.

Ø      Further coordination with Haskell Indians Nations University and K-12 schools.

Ø      Further coordination with Johnson County Transit and KDOT on K-10 Connector service by having service expanded beyond college campuses to also serve major employers in Lawrence and Johnson County.

Ø      Continue efforts to grow participation in Carpool Connection for commuters in Lawrence interested in ridesharing.

Ø      Continue public outreach and education efforts about public transportation services within the community.

Ø      Ongoing implementation of travel training program both in individual and group settings.

Ø      Further develop partnerships with major employers in the community by developing incentive programs for employees to use public transit to get to and from work.

Ø      Continue to obtain vital customer feedback through passenger surveys that provide useful suggestions to staff on what people would like to see in terms of service improvements.

Ø      Continue efforts to make improvements to passenger amenities to make transit service more attractive and user-friendly.

Ø      Continue to work closely with the Public Transit Advisory Committee on Policy/Standards, Service/Amenity Improvements, and Public Outreach/Education efforts.

Ø      Continue efforts to improve the transit website to make it more user-friendly as well as to sell bus passes online.

Ø      Continue efforts to work on replacing fixed-route and paratransit vehicles that have fulfilled their useful service life requirements.

Ø      Continue efforts to influence the planning process so that public transportation is considered in all site/development plans and infrastructure improvements, e.g., bus pull-outs, sidewalks, wheelchair landing pads, transit shelters and benches, and transit-friendly corridors.

Ø      Continue efforts to build and grow effective relationships with Federal and State legislators and educating them on the importance of public transportation in our community and within the State of Kansas.

Ø      Continue efforts of working with the Kansas Congressional Delegation in obtaining Federal Transit Discretionary funding (e.g., FTA Section 5309) needed to fund major capital improvements for vehicle acquisition/replacement and construction of new bus facilities such a Bus Maintenance/Administration facility.

Ø      Continue efforts to find and obtain additional Federal and State resources needed to support operating the transit system and to make service improvements.

Ø      Remain actively involved with the Kansas Public Transit Association which promotes public transportation use in the State of Kansas.

Ø      Remain actively involved in serving on the American Public Transportation Association Small Operations Sub-Committee that is focused on the issues and needs of transit systems in small urban communities (less than 200,000 population) throughout the nation.

Ø      Maintain proper oversight of the City’s transportation provider, MV Transportation, Inc. and ensure compliance with all applicable Federal, State and local regulations.

Ø      Maintain proper oversight of University of Kansas Park and Ride shuttle service to ensure that City owned vehicles are properly operated and maintained and that service complies with applicable Federal, State, and local requirements.

Ø      Continue efforts to collect and submit operating data on a monthly and annual basis to the National Transit Database where the information is used to determine future Federal formula funding levels.

 

Critical Issues

 

There are a few critical issues that have come to the forefront that will impact next year’s FY08 budget.  The most critical issue surrounds the Public Transportation Fund being entirely spent down to a near zero balance in FY07.  In order for service to remain at current levels in terms of days of service, length of daily service hours, frequency of service, and route coverage providing accessibility to a variety of community resources, will require a significant influx of funding to off-set the funding no longer available in the transit fund.  It is important to keep in mind that current Federal and State resources cover approximately 50% of the total annual operating cost of the transit system and that Federal and State resources cover up to 80% of capital expenditures such as vehicle acquisition/

replacement.  Specifically, if additional resources are not dedicated to maintain current service levels, Lawrence citizens should possibly expect a combination of the following:

 

Ø      The elimination of Saturday fixed-route and paratransit service;

Ø      The elimination of weekday service after 6:00PM;

Ø      A decrease in the frequency of fixed-route service on all routes from 40 minutes to 80 minutes;

Ø      The elimination 4 buses that operate fixed-route service so the maximum amount fixed-route vehicles operated drops from 10 to 6 vehicles reducing the service area and accessibility to community resources.

Ø      Under the service scenarios listed above would also result in potential layoff of 20 or more contracted local employees who in FY08 will be paid between $10.17 and $13.25 per hour and receive employer paid healthcare benefits. 

 

Furthermore, if the City Commission decides not to dedicate additional resources and moves forward with service cut backs, then per contractual terms with MV Transportation, Inc, any increase or decrease in the number of revenue vehicle service hours provided in the RFP of 15% or more will open the contract up for rate adjustment.  At this time there is not a fuel escalation clause in the contract meaning that for the last few years the City has not incurred higher fuel costs.  Any cost saving that the City expects to receive for the year will be somewhat offset by adjustments in the contractual rates.

 

In addition, the Transit Department is currently in the process of revising T Lift paratransit service policies to better manage the growing demand and cost for providing ADA complementary service as required by law for operating a public transportation system.  Furthermore, the Transit Department is in the process of increasing fares for both regular T fixed-route service and T Lift paratransit service.  What is proposed is that fares be doubled.  Increasing fares should help increase revenue for FY08, however it is anticipated that amount will not be sufficient to cover the funding gap.  The City Commission in May will be considering the service and fare policy changes and will need to decide to implement the recommended policies or not.  Their decision will impact revenues in FY08. 

 

Furthermore, in FY08 the City will be entering into its last year of the contract with MV Transportation, Inc. which will expire at year’s end.  Staff will be focused on issuing a new RFP for a contracted transportation provider beyond FY08.  The City Commission should anticipate that any new contract is going to be significantly more than what is presently being spent since it is likely that a future contract will have a fuel escalation clause and that contractors will factor in the age and maintenance requirements of the vehicle fleet being operated.  The Transit Department plans on replacing six (6) fixed-route vehicles with existing available funding by the time a new contract is enacted in FY09, however, half of the fixed-route fleet being operated will be  beyond the manufacturer’s and Federal Government’s specified useful-service life.  The contractors pricing, at least in FY09, will reflect the cost of maintaining and operating older vehicles until sufficient funding is obtained and vehicles can be replaced.  In addition, recent information obtained about prevailing wage rates in the transit industry indicates the Lawrence Transit System, as a contracted employee transit system, does not enjoy wages commensurate with public employee transit agencies in other urban communities in the State of Kansas.  Specifically, the current top rate for the Kansas City Area Transportation Authority for bus operators is $20.61.  The current top pay rate for bus operators for Johnson County Transit is $13.52, however, that rate is presently being renegotiated by their contracted service provider’s workers union.  The current pay rate for bus operators for the Unified Government of Wyandotte County is $16.10.  The current top pay rate for bus operators for Topeka Metropolitan Transit Authority is $15.88.  The current top pay rate for bus operators for the City of Wichita Transit System is $14.99.  The City Commission will need to decide in a future operating contract if it will want to set a minimum rate of what contracted bus operators working for the City are to be paid based on prevailing wages currently being paid by neighboring metropolitan communities for similar work performed.  Paying a competitive wage rate will attract more qualified bus operators and reduce contractor employee turnover that impacts the level and quality of service provided.

 

In addition, the University of Kansas will also be seeking a contracted transportation provider at the same time the City is searching to provide transit services beyond FY08.  The City Commission will need to decide if the City and University should work together on a joint procurement and have one contracted transit provider operate service for both the City and University.  This is going to require continued dialogue and negotiation in FY07.  The Transit Department will likely need to release an RFP for services beyond FY08 in late Spring.

 

Lastly, the City Commission in FY08 will also need to decide how much funding they are going to want to dedicate for the K-10 Connector to continue to provide service between Lawrence and Johnson County.  This service, launched earlier this year, is a one-year demonstration project that has exceeded initial expectations in terms of ridership.  Johnson County Transit is seeking funding partners in FY08 to continue operating service.  The City Commission will need to determine based on limited funds if it should focus on funding existing public transportation services in Lawrence or fund transportation services that link Lawrence to other communities.