HomeMy WebLinkAbout06-06-2017 Item 18 Transit Fiscal Year 2017-19 Fund Review Meeting Date: 6/6/2017
FROM: Daryl Grigsby, Director of Public Works
Prepared By: Gamaliel Anguiano, Transit Manager
SUBJECT: TRANSIT FISCAL YEAR 2017-19 FUND REVIEW
RECOMMENDATION
1. Review and approve the Fiscal Year 2017-19 Transit Enterprise Fund Review; and
2. Conceptually approve the Fiscal Year 2017-19 Transit Enterprise Fund financials and budget,
with final action on June 20, 2017, with the adoption of the 2017-19 Financial Plan.
DISCUSSION
Overview
The City of San Luis Obispo has been providing public transit service s ince 1974. Each year,
SLO Transit provides essential bus service for over one million passengers. This report
presents the Fiscal Year 2017-19 Transit Fund review for the next two-year period and
provides a five-year forecast for the fund to identify fisc al issues that may affect the Fund.
The report also discusses changes in operational costs and potential funding changes in
local, state and federal funding levels.
Overall, the Transit Fund is forecast to end F iscal Year 2016-17 with a modest year-end
working capital amount to cover operations and assist in minor capital expenditure projects.
The Transit Fund will maintain the minimum 20% reserve level in working capital in
accordance with the City Financial Management policies. Finally, the City of Sa n Luis
Obispo's Transit Fund continues to provide a viable mobility option for residents and
visitors. A wide range of users continue to receive services, including commuters, transit -
dependent riders, students, disabled, and elderly.
Background
Fiscal Year 2017-19 Transit Enterprise Fund Analysis Report
The Fiscal Ye a r 2017-19 Transit Enterprise Fund Analysis Report (Attachment A )
includes changes in financial position, analysis assumptions, an update on major activities
and programs and shows the anticipated five-year capital improvement projects for the
fund.
As presented at the April 18th, 2017 Strategic Budget Review (SBR) the Transit Fund ended
Fiscal Year 2015-16 with a Working Capital of approximately $3 million. The fiscal outlook for
the next five years’ shows some uncertainties given today’s political climate and historical trends
so the Fund is projecting highly conservative revenue numbers. Operations can be sustained
despite CalPERS changes but for years outside of the two-year Financial Plan, the fund balance
is shrinking due to expenses exceeding annual revenues. Major capital projects, such as new bus
purchases, are highly dependent upon future grants.
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Expenses
Expenditures will continue to be mitigated to reflect revenue levels and m aintain mandatory
20% farebox recovery requirements. While staff had previously anticipated major service
expansion as recommended by the Short-Range Transit Plan, given the current financial
constraints, new services will not be as robust as first anticipated. These new services will be
rolled out beginning on June 18th and will provide important improvements to the base transit
services. This schedule will represent a modest service expansion. The remaining
recommendations for expansion of service will be phased in and dependent on the availability
of funding.
The four-year Operations & Maintenance contract with First Transit Inc, which commenced on
July 1st, 2016, establishes the operational cost for the next four years. Costs incrementally
increase approximately 3% each year. First Transit fees are based on fixed administrative costs
and non-fixed costs based on revenue service hours – these changes are reflected in the Fund
forecast.
Fuel prices for FY 16-17 have been lower than expected. Fuel industry forecasts, however,
predict that they will return to historic levels in FY 17-19, as already being seen. The Transit
Fund forecast continues to program fuel costs in a conservative manner due to the extreme
volatility of prices that have been experienced in recent past.
Revenues
The fund review includes new revenues that are anticipated as a result of the April 4th, 2017, City
Council approval of transit fares. The 25-cent change to the base fare, from $1.25 to $1.50, and
the changes to the various pass types enables the Transit Fund to meet the 20% farebox recovery
obligation.
SLO Transit farebox income also includes the University Transit Subsidy. This subsidy provides
for unlimited trips for students, staff, and faculty on SLO Transit. Cal Poly current ridership is
65% of the total annual trips for the system. The current one-year extension approved by
Council is scheduled to expire on June 30th, 2017 and is currently being negotiated by staff of the
two agencies. It is likely that an extension for a month to month continuation of the program
will be accommodated if a revised agreement is not completed prior to that date. For the fund
projection staff is using a very conservative subsidy amount increase as a placeholder for its
projections in the fund review.
State funding is a major funding source for Transit . The Transit Development Act (TDA) of
California provides two funding sources for transportation programs in general and transit in
particular. Local Transportation Fund (LTF) is derived from a ¼ cent of the general sales tax
collected statewide. State Transit Assistance fund (STA), which is derived from the statewide
sales tax on diesel fuel.
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1. STA - Fuel price estimates used to set STA revenue amounts, have been lower than
anticipated. Therefore, the tax collected on it has also been lower than expected and STA
adjustments downward have resulted. Although the recent escalation in fuel prices could
have a positive impact in helping reverse the declining STA trend, the escalation of fuel
prices will also have a negative impact on the fuel budget line item.
2. LTF – Similarly, sales tax revenue on gasoline that funds our LTF has been lower but
more recently has begun to stabilize
3. Regional Transit Authority (RTA) Joint Powers Authority (JPA)Funding – the City is a
major JPA partner of the Regional Transit Authority (RTA) who provides our demand
responsive and intracity transit services for the county. Current “off-the-top” funding
requirements for RTA comes directly from state transit funding sources. If these revenue
sources are down it means less funding for SLO Transit unless RTA can accommodate
the reduction. Similarly, if RTA costs increase, additional TDA revenue is required to
help fund their services. RTA expenses are projected to significantly increase during each
of the next two years. This results in less funding for City services and are reflected in the
budget forecast.
Fortunately , during this Financial Plan timeframe the Transit Fund has a modest working
capital reserve and unspent revenue from prior years due to waiting for the SRTP approval
and changes in service levels. These amounts will help address the reduced State revenues
in the next two-year plan. This is significant as it will enable staff to continue services in the
short-term and develop strategies for long-term sustainability and service delivery in the outer
years of the forecast.
Furthermore, Governor Brown recently signed into law Senate Bill No. 1 (SB1). SB1 is an
additional fuel tax to help support transportation projects across the state. Early projections
suggest that revenues generated by SB1 could help the Transit Enterprise Fund in a modest
way. However, it should be noted that there is some disapproval and desire to repeal SB1 by
opposition groups. Given the timeframe for implementation of SB1, funding from this source
has been omitted from this financial plan until it is certain. Staff will be able to provide a
clearer picture of the impact of SB1 at a Mid-Year budget update but the annual amounts for
operating will likely be under $50,000.
Federal funding is the other major source for the Transit Fund. The Fixing America’s Surface
Transportation (FAST) Act is the current federal transportation funding program. While the
FAST Act continues modest support of public transportation, recent recommended cuts to the
Department of Transportation’s budget by the current Administration has some local
implications to the Transit fund. So far, these appear to be nominal, but are uncertain for the
long term. Staff is proceeding with conservative numbers for Federal assistance.
Capital Projects
The 2017-19 Transit Enterprise Fund identifies the essential capital projects for the next five
years. These projects include replacement of six (6) transit vehicles anticipated to meet their
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“end-of-useful-life” (per Federal Transit Administration) within the next five years. The ability
to carry out these replacements dependent on federal grants which typically fund up to 80% of
the capital expenditure. If the City is not awarded any of these capital assistance grants, the
costs will not be incurred and some alternative fleet management plan will need to be put in
place.
Overall, capital funding continues to be fully dependent upon Federal and State grants.
ENVIRONMENTAL REVIEW
Adoption of a budget is not a project as defined under CEQA.
FISCAL IMPACT
Attached to this report is the detailed analysis of the Transit Fund revenues, expenditures and
changes in financial position. The 2017 Transit Fund Analysis includes the key assumptions
used in preparing the Fund projections. Consistent with the analysis presented to Council in this
report and the Preliminary 2015-17 Financial Plan, there are sufficient funds to support
operations with capital projects being completed pending grant funding.
ALTERNATIVES
Modify the Fund Analysis. The City Council could choose to accept all or part of the 2017
Transit Fund Review analysis as presented to and direct staff to seek additional funding sources,
defer capital projects or provide transit operating cost reductions. Staff does not recommend this
option as the proposed fiscal forecast provides the best “snapshot” of funding at this time based
upon the current and the latest information projected and provided by the State an d Federal
governments. Staff will continue to update the fiscal forecast and information on funding
sources as received, with the intention to defer capital projects if grant funds are not realized.
Attachments:
a - Transit Fund Analysis 2017
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ATTACHMENT 1
TRANSIT ENTERPRISE FUND REVIEW
2017-19 Financial Plan
Transit Enterprise Fund
2017 Fund Analysis
June 6th, 2017
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Attachment 1
Page 2
2017 Transit Fund
TABLE OF CONTENTS
I. Contents
I. OVERVIEW ........................................................................................................................... 3
II. 2017-19 FINANCIAL PLAN ................................................................................................. 3
1. Summary of Operating Programs ................................................................................. 3
2. Capital Improvement Program ..................................................................................... 4
3. Revenues, Subventions, and Grants ............................................................................. 4
III. ASSUMPTIONS .................................................................................................................. 5
1. General Government Assumptions ............................................................................... 5
2. Revenue Assumptions .................................................................................................. 5
3. Transportation Operating Expenses.............................................................................. 6
4. Capital Improvement Program (CIP) Expenses ........................................................... 7
5. Ridership Assumptions ................................................................................................. 7
6. Other Unknowns ........................................................................................................... 8
IV. EXHIBIT A – Changes in Financial Position ...................................................................... 8
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Attachment 1
Page 3
2017 Transit Fund Report
I. OVERVIEW
This report presents the financial position of the Transit Enterprise Fund and recommends
operating program and capital project requests to address the identified needs in the Transit
Services program for the FY 2017-19 Financial Plan.
In recognition of the transit industry’s dependency on State and Federal funding, the Transit Fund
program is moving forward with caution and conservative es timates. In July of 2016, the City
awarded an Operations & Maintenance contract to First Transit Inc. The four -year contract, which
commenced July 1st, 2016, establishes the operational cost for the next four years. In August of 2016,
the City adopted the 2017-22 Short Range Transit Plan. This plan outlines the development of the
SLO Transit system for the next five years. The SRTP calls for a modification of routes for greater
connectivity and efficiency while also expanding transit services to better meet current and projected
passenger demand levels. Most of the recommended changes which result in greater connectivity and
efficiency are scheduled to be implemented on June 18 th, 2017, accompanied by a very modest
expansion of service. Remaining expansion of service will be dependent on the availability of funding.
State transit funding, particularly the Local Transit Fund (LTF), is expected to decrease for FY 17-
18 and beyond. Overall LTF revenues are expected to be about 11% lower for the City.
Fortunately, the Transit Fund has a modest working capital reserve that will help address the
reduced LTF revenues in the next two-year plan. Fuel prices for FY 16-17 have been lower than
expected and industry forecasts predict that they will return to historic levels in FY 17-18. The
Transit Fund budgets fuel costs in a conservative manner due to the historic volatility of prices that
have been experienced.
Overall, funding continues to be lean and highly dependent upon Federal and State grants and their
final budget appropriations. The currently forecast funding, along with the Cal Poly agreement
and farebox recovery, allow SLO Transit to continue its existing level of service. On April 4, 2017
the Council adopted new fares for the SLO Transit system. These changes in fares are included in
the five-year forecast and help deliver services as outlined in the SRTP. Capital expenditures will
be limited to projects that can be funded from grant revenues, keeping the local match required to
a minimum and preserving as much for operating expenses as possible.
II. 2017-19 FINANCIAL PLAN
1. Summary of Operating Programs
Below is the summary of the 2017-19 Financial Plan operating budget projections for the Transit
Services Enterprise Fund.
City of
San Luis Obispo
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Attachment 1
Page 4
The Fund Analysis is not proposing any Significant Operating Program Changes (SOPC).
2. Capital Improvement Program
Below is the summary of the 2017-19 Financial Plan capital project budget projections for the
Transit Enterprise Fund.
2017-18 2018-19 2019-20 2020-21 2021-22
Budget Budget Projected Projected Projected
Bus Stop Shelter Replacements 25,000$ 25,000$ 25,000$ 25,000$ 25,000$
Automatic Vehicle Location System 310,000$
SLO Transit Bus Replacements 1,060,000$ 1,590,000$ 1,590,000$
Trolley Replacement 250,000$
UPS Battery Replacement 1,001$ 1,001$
VM Infrastructure
Server Operating System 982$
VoIP Phone System 1,247$
Tait Radio System 52,299$
Firewall Replacement 2,035$
South Hills Radio Site Upgrade and Radio 3,317$ 2,395$
Microsoft Office Replacement 875$
Total Capital Program Expenditures 338,317$ 1,141,570$ 1,617,035$ 1,615,982$ 277,248$
Transit Capital Program
There are no vehicle replacements needed in 2017-18, however, beginning in FY 2018-19 the Fund
will again need to start programming vehicle replacements to retire vehicles beyond their useful
life. These replacements will be fully reliant on grant assistance to complete and if funding does
not materialize, the projects will need deferral or modification. The fund assumes participation of
Federal capital funding a ratio of 80/20 for all vehicle replacements.
3. Revenues, Subventions, and Grants
Federal revenues, which comprise 40% of operating costs, are expected to be about the same as
previous year’s allocation. However, State transit funding is predicted to decrease for this fiscal
year 2017-18 as a result of the lower than expected sales/gas tax/excise tax revenues in the Local
Transportation Fund (LTF) by as much as 11%. There is some hope that this decrease in State
funds is only true of this budget cycle and will recover to normal levels in outlying years. With
the recent passage of the Road Repair and Accountability Act of 2017 (SB -1), staff anticipates
additional revenue for transit but it is unknown at this time what that amount may be. Staff will
continue to monitor the revenues received by SB-1 and return at midyear if additional funding
appropriations are available.
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Attachment 1
Page 5
2017-18 2018-19 2019-20 2020-21 2021-22
Budget Budget Projected Projected Projected
Investment and Property Revenues 5,800$ 5,800$ 5,800$ 5,800$ 5,800$
From Other Governments
TDA Revenues (LTF)1,160,677$ 1,046,313$ 1,160,677$ 1,160,677$ 1,160,677$
TDA Revenues (STA)143,846$ 143,846$ 143,846$ 143,846$ 143,846$
Other Grants*174,600$ 1,060,000$ 1,590,000$ 1,590,000$ 250,000$
FTA Grants 1,399,640$ 1,399,640$ 1,399,640$ 1,399,640$ 1,399,640$
Service Charges 787,914$ 799,715$ 816,876$ 834,501$ 834,501$
Other Revenues 8,000$ 8,000$ 6,600$ 6,600$ 6,600$
Total Revenues 3,680,477$ 4,463,314$ 5,123,439$ 5,141,064$ 3,801,064$
Transit Revenue
III. ASSUMPTIONS
The following assumptions have been used to forecast the Transit Enterprise Fund analysis. The
discussion below provides detail for the key assumptions used to generate the changes in financial
position as provided as Exhibit A. It is important to note the proposed budget is a “snapshot” of
current funding and expenditure projections as of June 2017. The following discussion focuses on
major issues that could have an affect the Transit Enterprise Fund next fiscal year. These
assumptions have been incorporated into the 2017-19 budget projections.
1. General Government Assumptions
Minimum working capital (reserve) should equal at least 20% of the total Operating Program
expenditures per the City's fiscal policy. The 2017-19 year-end working capital meets the
minimum reserve policy levels however it will be spent down over time along with unspent prior
year revenues to address LTF reductions.
General Assumptions include:
Revenue Assumptions:
a) 0% increase in Federal Grants and 11% decrease in annual State Grants.
b) 9% Fare Increase in 2017-18 and a 1% annual increase thereafter. An annual
increase in Cal Poly Service Agreement.
c) Bus replacement grant revenue is assumed for each bus replacement.
d) 2017-19 LTF revenue reductions are based upon the Regional Transit Authority
(RTA) 'off the top' allocation as adopted by the RTA Board on 5/3/17.
Expenditure Revenues:
a) 2% annual increase in staffing costs.
b) 3% annual increase for contract services per agreement with First Transit.
c) 3% annual increase for operational short-range transit plan implementation
The Transit Enterprise Fund will commit all available transit funding to SLO Transit and will carry
over any unused funding for use in subsequent years and to maintain an adequate year-end fund
balance (reserve) and help weather budget uncertainties.
2. Revenue Assumptions
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Attachment 1
Page 6
Federal Transit Administration
Federal Transit Assistance (FTA) funding is formula-based upon population and service level
categories. In addition, the SLO Central Urbanized Area receives addition FTA funding for
performing above industry standards. Indications are that the final transit apportionments will
remain similar to current levels. The Fund Analysis projects FTA funding of $1,399,640 in 2017-
18 and 2018-19. FY 17-18 amounts have already been programmed by SLOCOG but need to
await final Federal adoption. This Federal funding will be used for operating assistance of SLO
Transit services and various capital projects such as bus shelter replacements, transit facility
expansion, and bus replacements.
Transportation Development Act
The Transportation Development Act (TDA) is comprised of two sources of funding for
transportation programs, Local Transportation Funds (LTF) and State Transportation Assistance
(STA) funding. LTF is derived from ¼ cent collected in retail sales taxes. STA is derived from
the statewide sales tax on diesel fuel. Both funds are distributed to the regions by the State.
With the recent decrease in fuel prices, along with some other factors, LTF funds are lower than
anticipated. While some “normalization” in the volatile fuel market has occurred, the “benefits”
of are not certain yet. The County Auditor LTF projections a re lower than originally estimated
with approximately $1,160,677 (-11%) in 2017-18 from the previous year which benefited from
one-time higher than anticipated increases. Fortunately, the Transit Fund has a modest working
capital reserve and unspent revenue from the previous year in the LTF. These amounts will help
address the reduced LTF revenues in the next two-year plan.
Fare Revenue
On April 4th, 2017, City Council approved the first rate change to Transit fares in over eight years.
The 25-cent change to the base fare and the subsequent changes to the various pass types helps
support the transit fund in meeting its obligation for generated 20% (farebox recovery) of the
operational costs in revenue. The 20% farebox recovery is based on newly project operational
cost of a new service contract and phased in implementation of the SRTP.
Cal Poly Subsidy
This subsidy program between the City and CalPoly provides for unlimited trips for students, staff,
and faculty on SLO Transit; which, on average, account for 65% of the total system’s ridership.
The current one-year extension approved by Council is scheduled to expire on June 30th, 2017.
Staff hopes to bring a renegotiated multi-year subsidy agreement to Council before then. A month-
to-month extension may be necessary if otherwise. Meanwhile, staff is using a very conservative
subsidy amount as a placeholder for its projections.
Trolley Operations
Trolley operations were reduced in FY 2012-13 in response to the loss of Tourism Business
Improvement District (TBID) support and declining ridership. Since then, Trolley ridership has
improved and the operation is now better supported with the 25¢ fare collected for each ride.
3. Transportation Operating Expenses
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Attachment 1
Page 7
Contract Services
In July of 2016, the City awarded an Operations & Maintenance contract to First Transit Inc. The
four-year contract, which commenced July 1st, 2016, establishes the operational cost for the next
four years. Costs incrementally increase on average by approximately 3% annually. First Transit
fees are based on fixed administrative costs and non-fixed costs based on revenue service hours.
Fuel
Fuel costs continue to be volatile and are difficult to predict. Fuel prices for FY 16-17 have been
lower than expected. However, industry forecasts predict that they will return to historic levels in
FY 17-19, as already being seen. The Transit Fund forecast continues to program fuel costs in a
conservative manner due to the extreme volatility of prices that have been experienced in recent
past.
General Government
The newly revised Cost Allocation Plan resulted in an increase of approximately 7% for FY 2017-
18 over the current year. This increase is attributed to the change in methodology for how the City
calculates direct and indirect charges for Enterprise Funds that receive General Fund program
support. The Cost Allocation Plan, which also affects the performance of farebox ratio, is
considered a Central Service plan by the FTA and does not require FTA review or certification.
Future cost to the transit system for indirect costs could increase significantly due to the increase
in retirement costs associated with the discount rate adjustment.
Short Range Transit Plan
In August of 2016, the City adopted the 2017-22 Short Range Transit Plan. This plan outlines the
development of the SLO Transit system for the next five years. The SRTP calls for a modification
of routes for greater connectivity and efficiency while also expanding transit services to better
meet current and projected passenger demand levels. Most of the recommended changes which
result in greater connectivity and efficiency are scheduled to be implemented on June 18th, 2017,
accompanied by a very modest expansion of service. The remaining recommendations for
expansion of service will be phased in and dependent on the availability of funding.
4. Capital Improvement Program (CIP) Expenses
The Transit Fund analysis anticipates a conservative level of Federal funding apportionment for in
the 2017-19 fiscal years. Capital expenditures will be limited to projects that can be funded from
grant revenues, keeping the local match required to a min imum and preserving as much for
operating expenses as possible. There is no vehicle replacement in 2017-18, however, beginning
in FY 2018-19 the Fund will again need to start programming vehicle replacements to retire vehicle
beyond their useful life. The fund assumes participation of Federal capital funding a ratio of 80/20
for all vehicle replacements. The fund assumes participation of Federal capital fund in a ratio of
80/20 for all vehicle replacements. In 2014 the County became eligible to receive Cong estion
Mitigation and Air Quality (CMAQ) federal funding. This funding is a discretionary fund and can
be used for capital assistance. The Fund analysis does not anticipate the use of CMAQ at this time
but will seek funding assistance from this fund (particularly for vehicle replacement) if it is
available in future years.
5. Ridership Assumptions
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Attachment 1
Page 8
FY 2015-16 set an all-time high record ridership with 1,209,701 trips provided during this period.
Transit ridership is cyclical with consecutive years of regular increases followed by years of slow
decline. Based upon year to date ridership, FY 16-17 will not be as high as last year’s historic
numbers with a forecast of being slightly above the 1,100,000-ridership threshold.
6. Other Unknowns
Volatile Fuel Prices
Staff continues to exercise prudent judgment in projecting budgets for fuel needed for the SLO
Transit system. Volatile fuel prices continue to pose challenges in balancing the budget. Staff will
continue to analyze fuel trends and make budget adjustments as necessary.
Regional Transit Authority Participation
The fund analysis assumes a modest increase of City funding to RTA services. Depending upon
RTA need, state funding available for use by SLO Transit could be less if RTA requires increased
funding beyond amounts assumed in the fund forecast.
California Air Resource Board – Zero Emission Goal
The Air Resource Board, California’s air quality regulatory body, has started with the development
of its Zero Emission fleet goal for heavy duty vehicles. In this goal, they are proposing that all
heavy-duty vehicles (buses included) move to electric-powered vehicles by 2030, in order to meet
their air quality attainment standards. The current price of an EV vehicle is still well over $1
million per vehicle so the ability to adopt this goal is still out of reach for most transit agencies.
However, considering the twelve-year life of a vehicle, transit agencies across the State will need
to consider procuring EV vehicles come 2018 if this goal is adopted.
IV. EXHIBIT A – Changes in Financial Position
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Attachment 1
Page 9
2017-19 TRANSIT FUND
FINANCIAL SCHEDULES
TRANSIT FUND FIVE-YEAR FORECAST
Actual
2015-16
Mid-Year
Budget 2016-17
Projected
2017-18
Projected
2018-19
Projected
2019-20
Projected
2020-21
Projected
2021-22
Revenues
Investment and Property Revenues 11,203 5,800 5,800 5,800 5,800 5,800 5,800
From Other Governments
TDA Revenues (LTF)1,312,716 1,286,625 1,160,677 1,046,313 1,160,677 1,160,677 1,160,677
TDA Revenues (STA)162,418 159,890 143,846 143,846 143,846 143,846 143,846
Other Grants*39,738 1,300,200 174,600 1,060,000 1,590,000 1,590,000 250,000
FTA Grants 1,373,948 1,424,555 1,399,640 1,399,640 1,399,640 1,399,640 1,399,641
Service Charges 658,601 690,381 787,914 799,715 816,876 834,501 834,501
Other Revenues 868 4,600 8,000 8,000 6,600 6,600 6,600
TOTAL REVENUES:3,559,492 4,872,051 3,680,477 4,463,314 5,123,439 5,141,064 3,801,065
Expenditures
Operating Programs
Operating Expenses 2,920,657 3,448,368 3,321,189 3,411,092 3,505,513 3,511,832 3,518,277
Retirement Contribution 22,956 22,956 23,276 24,545 25,066
Unfunded Liabilities 38,229 41,634 41,634 50,263 53,858
Discount Rate Adjustment 1,884 3,823 8,526 10,555
General Government 277,329 288,995 319,987 319,987 319,987 319,987 319,987
Motion Project -one time 58,081 58,081
Motion Project - on going 21,020 23,579
Total Operating Programs 3,197,986 3,737,363 3,760,442 3,876,654 3,894,233 3,915,153 3,927,742
Capital Improvement Plan Projects*232,661 1,657,388 338,317 1,141,570 1,617,035 1,615,982 277,248
TOTAL EXPENDITURES:3,430,647 5,394,751 4,098,759 5,018,224 5,511,268 5,531,135 4,204,990
Other Sources (Uses)
Cashflow adjustment for working capital
Operating Transfers Out
Other Sources (4,200)
TOTAL OTHER SOURCES:0 (4,200)0 0 0 0 0
Revenues and Other Sources
(Over/Under) 128,846 (526,900)(418,281)(554,910)(387,829)(390,070)(403,925)
Working Capital, Beginning of Year 2,775,920 2,904,766 2,377,866 1,959,585 1,404,675 1,016,846 626,776
Working Capital, End of Year Fund
Reserves 2,904,766 2,377,866 1,959,585 1,404,675 1,016,846 626,776 222,851
* Bus Replacements costs are equal to the Other Grant revenues. Should grant funding for bus replacements not become available, staff will
explore other options, such as bus refurbishment, to extend the life of the buses.
Revenue Assumptions: 0% increase in Federal Grants and 10% decrease in annual State Grants. An annual increase in Cal Poly Service
Agreement. 9% increase in Fare Increase in 2017-18 and a 1% annual increase thereafter. Bus replacement grant revenue is assumed for
each bus replacement. 2017-19 LTF revenue reductions are based upon the Reginonal Transit Authority (RTA) 'off the top' allocation as
adopted by the RTA Board on 5/3/17.
Expenditure Assumptions: 2% annual increase in staffing costs, 3% annual increase for contract services per agreement with First Transit,
3% annual increase for operational short range plan implementation
2017-19 Finacial Plan Out-Year Fund Projections
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Transit Fiscal Year 2017-19 Fund ReviewCity Council Presentation June 6th, 2017
Transit HighlightsFY 15/16 set Record Ridership with over 1.2 Mrides
Transit Highlights2015 Council approved purchase of three replacement vehicles2017 Took delivery of three latest transit vehicles1) Emission Reduction Tech2) Aerodynamic Styling3) New Paint Scheme4) Video Infotainment5) Sunroof Escape Hatches6) And more…
Transit Highlights2016 adoption of the Short Range Transit Plan (SRTP)1) Simplified Nomenclature2) Bi-Directional Service3) Streamlined/ Efficient Routes4) Meaningful connections5) 12 New Bus Stops6) Expansion of Service Schedule
Transit Highlights2017 implementation of SRTP.
Assumptions:Revenues1)Federal Grants - Flat2)State Grants – Declining by approx. 10%3)Local – Increasing by approx. 9%Expenditures1)2% annual increase in staffing costs2)3% annual increase for contract services per agreement with First Transit 3)3% annual increase for operational Short Range Transit Plan Implementation
2017-19 Revenues Vs. Expenses39%34%22%5%RevenuesFederalStateLocalOther11%68%4%17%ExpensesAdministrative CostsPurchased TransportationGeneral GovCapital Improvement Projects
2017-19 Capital Projects1.Automatic Vehicle Location System replacement will be funded by FY 15/16 & 16/17 CA State Prop 1B Grant.2.Bus Stop Amenities (e.g. shelters, benches, etc.) being purchased with fund balance.3.Replacing two buses, reaching the end of useful-life, in the second year (2018-19) will be highly dependent of the award of Capital Grants.4.Funding for citywide I.T. projects
Summary & Next Steps1)Continue to monitor Federal & State grant revenuesa.Program State SB1 Grant Money2)Work with our Regional partners to further address the areas increasingly limited allocated funding3)Enter into a long-term agreement with CalPoly for a Transit Subsidy Program4)Continue to promote the use of SLO Transita)Young adultsb)Seniorsc)Others
Questions?
TRANSIT FUND FIVE-YEAR FORECASTActual 2015-16Mid-Year Budget 2016-17Projected 2017-18Projected 2018-19Projected 2019-20Projected 2020-21Projected 2021-22RevenuesInvestment and Property Revenues 6,404 5,800 5,800 5,800 5,800 5,800 5,800From Other GovernmentsTDA Revenues (LTF) 1,312,716 1,286,625 1,160,677 1,046,313 1,160,677 1,160,677 1,160,677TDA Revenues (STA) 162,418 159,890 143,846 143,846 143,846 143,846 143,846Other Grants* 39,738 1,300,200 174,600 1,060,000 1,590,000 1,590,000 250,000FTA Grants 1,373,948 1,424,555 1,399,640 1,399,640 1,399,640 1,399,640 1,399,641Service Charges 658,601 690,381 774,114 785,915 804,476 822,101 822,101Other Revenues 868 4,600 8,000 8,000 6,600 6,600 6,600TOTAL REVENUES: 3,554,693 4,872,051 3,666,677 4,449,514 5,111,039 5,128,664 3,788,665ExpendituresOperating ProgramsOperating Expenses 2,920,657 3,448,368 3,321,189 3,411,092 3,505,513 3,511,832 3,518,277Retirement Contribution 22,956 23,276 23,276 24,545 25,066Unfunded Liabilities 38,229 41,634 41,634 50,263 53,858Discount Rate Adjustment 1,884 3,823 8,526 10,555General Government 277,329 288,995 319,987 319,987 319,987 319,987 319,987Motion Project -one time 58,081 58,081Motion Project - on going 21,020 23,579Total Operating Programs 3,197,986 3,737,363 3,760,442 3,876,974 3,894,233 3,915,153 3,927,742Capital Improvement Plan Projects* 1,657,388 338,317 1,141,570 1,617,035 1,615,982 277,248TOTAL EXPENDITURES: 3,197,986 5,394,751 4,098,759 5,018,544 5,511,268 5,531,135 4,204,990Other Sources (Uses)Cashflow adjustment for working capitalOperating Transfers OutOther Sources (4,200)TOTAL OTHER SOURCES: 0 (4,200) 0 0 0 0 0Revenues and Other Sources (Over/Under) 356,708 (526,900) (432,081) (569,030) (400,229) (402,470) (416,325)Working Capital, Beginning of Year2,775,920 2,983,714 2,456,814 2,024,733 1,455,703 1,055,474 653,004Adjustment for Long Term Accruals(148,914)Working Capital, End of Year Fund Reserves 2,983,714 2,456,814 2,024,733 1,455,703 1,055,474 653,004 236,6792017-19 Finacial PlanOut-Year Fund Projections