CENTRE AREA TRANSPORTATION AUTHORITY
December 15, 2010
CATA Board Meeting Room
2081 W. Whitehall Road
State College, PA 16801
BOARD MEMBERS PRESENT: John Spychalski, Chairman
Joe Davidson, Vice-Chairman
Richard Kipp, Treasurer
STAFF PRESENT: Hugh Mose, General Manager
Louwana Oliva, Assistant General Manager
Judith Minor, Director of Administration
Kimberly Fragola, Assistant Director of Administration
Mark Kutzer, Director of Maintenance
Eric Bernier, Service Development Manager
Jackie Sheader, Marketing Manager
Greg Kausch, Transportation Planner
Ryan Harshbarger, Transportation Analyst
Nick Soccio, Facilities Manager
Marsha Kyper, Assistant to the General Manager
I. CALL TO ORDER
Chairman Spychalski called the meeting to order at 4:14 p.m.
II. PUBLIC COMMENT
There was no public comment.
III. ACKNOWLEDMENT OF GARY POWERS’ FINAL MEETING
This was Gary Powers’ final meeting due to the term limits which Patton Township imposes on its appointments to the CATA Board. The Board and staff in attendance expressed appreciation to Gary for his ten years of service on the Board and presented him with a resolution of appreciation.
IV. DISCUSSION ITEMS
A. Mid-year Recap
Hugh Mose referred to a memo provided to the Board which provided an update on the progress which has been made in addressing the annual goals that the Board had laid out for the staff.
B. Funding Update
Hugh Mose reported that at this point there is still no solid information on federal funding for the current fiscal year, nor FY 2011/12. As for state funding, an inquiry to PennDOT elicited the response that in spite of recent upticks in sales tax receipts CATA should plan for the same level of state funding next year as it received this year. Hugh referred to the same “pessimistic” and “optimistic” spreadsheets that Judi Minor had prepared for the last Work Session in October, which were again included for the Board’s information. Hugh reiterated that under the most favorable circumstances CATA’s financial situation is not sustainable long-term, and that unless things turn around, some serious belt-tightening will be necessary.
Hugh Mose stated his desire to confirm that, philosophically, everyone is on the same page regarding whether cutting back should begin now, well in advance of when funds are expected to run out. Hugh further stated that the service planning team believes that significant cost savings can be gained by reorganizing the service in a way that reduces “platform time” with minimal impacts on riders; that some options for consideration would be the increasing of efficiencies by interlining routes to minimize travel time, deleting certain trips to facilitate driver lunch breaks, running less “regular” service and more “express” trips, etc. Hugh reported that regardless of increased efficiencies, several thousand hours of service may need to be cut.
Hugh Mose reported that beyond service adjustments, CATA is somewhat limited in how much it can cut from the budget. Fully three-quarters of CATA’s operating budget is consumed by personnel costs (half is in just two line items: Driver wages and Driver benefits), while other major categories, such as fuel, insurance, parts and utilities, are relatively fixed. Hugh went on to state that he does not believe that conditions yet require dramatic cuts in training, marketing, and other areas that would hurt CATA, but that there are “soft” areas where expenditures can and will be reduced.
Hugh Mose further stated that the other way to make some pretty serious inroads into CATA’s operating costs will be to limit the escalation of wage, salary and benefit expenses, perhaps scale back certain elements of its compensation program, and even consider eliminating positions. Hugh stated that for many reasons – not the least of which is that CATA has a represented workforce – such changes should be approached very carefully. Hugh recommended that in order to give the Board ample time to consider these issues, a separate Executive Session should be scheduled at a later date.
The consensus of the Board was that planning for service cuts and reductions in expenditures should begin now, well in advance of when it is projected that funds will run out; that it would consider the options of interlining routes, deleting trips to facilitate driver lunch breaks and the running of less “regular” service and more “express” trips; that a separate Executive Session to discuss personnel issues as related to the funding situation should be scheduled at a later date.
Hugh Mose reported that since raising fares in August, cash, token and pass revenues are up overall by 12.36%, while ridership in these categories has risen 10.35%. Cash revenue, however, has declined by 1.24% through October. Hugh further stated that the data suggest that many riders have shifted from cash to tokens or passes, where there are much greater discounts. Hugh cautioned that the increase in token revenue could very likely be inflated due to people having purchased extra tokens in July and August in anticipation of the fare increase.
Hugh Mose stated that tokens and passes had historically been sold at a small discount relative to the cash fare. However, with the cash fare increase from $1.25 to $1.50 that took effect on August 1, that degree of discount was significantly increased so that a rider who purchases tokens by the roll pays $1.40 per trip and because not all tokens sold are redeemed, the effective rate is considerably higher. Hugh went on to state that likewise, the discount for OnePasses was increased, so that a twice-a-day rider would be paying roughly $1.30 per trip. However, because so many OnePass riders are very heavy users of the service, data shows that the average pass-holder is paying as low as $1.15 per trip. Hugh suggested that in order to increase fare revenue, consideration might be given to increasing the prices for OnePasses, and perhaps tokens.
Chairman Spychalski requested that staff look at the fare structure of other peer transit systems and report its findings to the Board. The Board consensus was that it would consider increasing the cost of a CATA OnePass.
E. Apartment Passes
Hugh Mose reported that each year in anticipation of what the ridership from each apartment complex will be, an appropriate pass price is negotiated, which keeps each complex at roughly the same per-trip rate. However, the year-after-year increased utilization has driven down the per-trip revenue. This year, if current trends continue, the revenue per trip will range from $0.64 at Waupelani Lofts to $1.03 at Oak Hill, with an average of $0.78. Although apartment pass customers can be transported very efficiently (they travel in large numbers, they are clustered together and they are generally located close-in), they cost on the order of $1.30 per ride, including overheads. Hugh stated that the very low per-trip rates, plus the fact that there are over 1.5 million annual apartment complex riders, suggests that consideration be given to a significant increase in the price of apartment passes.
Hugh Mose cautioned that because significant increases are needed from several of the complexes, this may be the time to consider moving to a whole new model for all the complexes; one which has been successfully used for several years with Vairo Village which has been paying by the trip (currently $0.93/ride), and starting this year with the apartments controlled by Copper Beach (at $0.90/ride). Furthermore, these complexes charge tenants for the privilege of getting a bus pass. Hugh further stated that if ridership grows, contracting by the trip will give CATA additional revenue, rather than simply adding to passenger capacity problems. Also, if some apartments opt to charge tenants for the privilege of getting a pass, as Copper Beech has done, that is likely to dampen the demand, but cause the occasional rider to become a “profitable” cash customer.
The consensus of the Board was that it would support a move to negotiating a “by the trip” contract with each apartment complex.
F. Penn State
Hugh Mose reported that Penn State currently pays $54.22 per revenue hour for LOOP and LINK service, an amount that is slightly less than the direct cost of providing the service. However, the extra miles and hours run, as well as all the additional riders carried, result in CATA getting additional federal and state funding, so that the hourly rate represents a fair number. Until this year the University had always agreed to an annual increase in the hourly rate commensurate with the growth in CATA’s cost of operating the service. However, this year Penn State said they couldn’t pay the additional 5.0% CATA needed, so a combination of a smaller hourly rate increase, a slight reduction in service, and an increase in the Ride-for-Five rate were negotiated.
Hugh stated that any approach used to negotiate this year’s contract with Penn State needs to leave the University open to easily move to Universal Access, an option it is in the midst of considering. Hugh then inquired if the Board was in agreement to utilizing the same approach for next year as was used last year. The consensus of the Board was that this same approach be used, subject to such adjustments as might be needed during negotiations to best meet CATA’s needs.
G. Service Policy
Eric Bernier stated that because CATA will be cutting service in the coming year, discussion needs to take place regarding service policies, so that the staff has some guidance as it looks at what services might be the best candidates for curtailment.
Eric Bernier stated that cutting service is always a challenge, and with CATA, it’s particularly difficult. If the least productive trips are cut, which are neighborhood service, a large portion of CATA’s service area will be disenfranchised, and routes that primarily serve permanent residents will be eliminated. If service in the commercial corridors is cut, where already only one bus an hour is operating, so little service will be running that it will be difficult to attract and retain riders. Eric went on to state that if the student housing corridors are targeted, where the buses are already overcrowded, CATA will be leaving riders standing on the curb, in many cases people who have prepaid for the service. If CATA attempts to cut service on campus, it will be inviting the University to take the LOOP and LINK in-house, or contract with another entity.
Hugh Mose stated that rather than start talking right away about changes that might be made to individual routes, perhaps it would be worthwhile to discuss CATA’s overall service philosophy.
The consensus of the Board was that staff should prepare specific recommendations for the Board’s consideration regarding revisions to the current service philosophy and policies.
H. Local Shares
Hugh Mose reported that in the mid-2000’s, when CATA was in tough financial straits, for six years running it asked the local Municipalities for and received 5.0% annual increases. Then, following the passage of Act 44, two years passed without a request for any additional funds from the local municipalities. For the current year CATA was granted a 5.0% increase. The participating municipalities and Penn State currently contribute $440,784 in local shares, less than four percent of CATA’s total operating budget.
Hugh Mose further reported that under Act 44, each transit system in the Commonwealth is required to secure a 15% local match to state operating assistance. Recognizing that getting to this level would be challenging for many communities, the law also limits any system’s annual increase to 5.0%, starting with the local match requirement that was in place under the prior state assistance program. Under this scheme CATA’s required local match this year is $410,774; next year it is expected to be $431,312, which will be just less than what is currently being received. Hugh stated that rather than have local funding fall to within $10,000 of the minimum, CATA should ask its municipal funding partners for another 5.0% increase.
The consensus of the Board was to ask for a 5.0% increase in funding from the local Municipalities.
Hugh Mose stated that a second local share issue relates to equity between Harris Township and Halfmoon Township. For the municipalities that are members of the Authority, the allocation system uses the COG formula to allocate the local share attributable to those routes that are considered to have some degree of regional value. (A prime example would be the P Route to the Mount Nittany Medical Center.) The assessments for Bellefonte Borough and Spring and Benner Townships, which lie outside of the Centre Region, have been based solely on the costs calculated for the route(s) that serve each.
Hugh Mose went on to state that with service to Halfmoon, CATA now has a municipality that is not a member of the Authority but IS in the Centre Region. Since the inception of service to Stormstown CATA has been treating Halfmoon like the other outlying municipalities that contract for service, with the result that Halfmoon pays less than $5,000 for its share of the mileage on the Z (Stormstown) Route. Harris pays slightly more for its B (Boalsburg) Route service, but because its local share includes a piece of all of the routes with regional significance, the Harris total is over $22,000. In addition, because under the current Miller Formula the miles of an “external” route that lie inside the boundaries of the CATA member municipalities are considered entirely “regional,” Harris Township actually pays nearly $1,000 to support its share of the Z Route.
Hugh Mose stated that the best way to address this inconsistency may be to reconsider the entire “regional factor” approach which would require the unanimous approval of the COG municipalities, and may be difficult to achieve, because of the impact on College Township, which benefits greatly because many of its routes have a large regional component. However, Hugh stated that if the Harris/Halfmoon discrepancy becomes an issue in the development of the coming year’s budget, he is prepared to suggest that approach, unless the Board has a different idea.
The consensus of the Board was to be proactive and to place the removal of the regional factor in determining local shares before the COG Finance Committee for its consideration.
J. Miller Formula
Hugh Mose stated that about five years ago, at the request of State College Borough, the COG Finance Committee considered the issue of whether the COG Formula used to allocate costs for other regional services should be used for CATA’s local shares. The CATA staff supported the change, because it felt that it would greatly simplify the cost allocation process. However, not all of the municipalities agreed, so no change was made. The issue has not been discussed seriously since, but it could come up again this year.
Hugh Mose reported the impacts on each CATA member municipality. Harris Township would see the largest percentage increase and Patton the greatest decrease, both in total dollars and in percent. Also, there would be other issues, such as losing the linkage between local share and miles of service, needing a new system for allocating costs for outlying municipalities and the equitable sharing of public-private partnership revenues. Hugh further stated that CATA should proceed very cautiously.
The consensus of the Board was that the issue goes hand-in-hand with the Harris/Halfmoon local share issue and agreed that a proactive approach to reconsidering how local shares are determined should be taken.
K. Exterior Bus Advertising
Jackie Sheader reported that several years back at the request of the College Township representative on the COG Finance Committee, the Board conducted a thorough review of bus advertising, and ultimately decided to continue not placing ads on the exteriors of the buses. In light of CATA’s current financial situation, the staff believes that exterior bus advertising should once again be looked at, so that the Board can reaffirm its position on the matter, and to be able to quickly implement a program should CATA’s financial situation require it. Jackie referenced an accompanying memo outlining some considerations and offering a recommendation.
The consensus of the Board was that dialogue with Penn State must occur in order to determine its expectation/position on revenue sharing and control over the advertising that would appear on buses; that the municipalities would also need to be consulted; that an RFP would help with the decision in that it would result in more definitive cost and revenue figures.
L. CATARIDE Eligibility
Hugh Mose stated that the Americans with Disabilities Act (ADA) requires transit systems to offer complementary paratransit for individuals who have mobility or cognitive impairments that preclude their using a fixed-route bus. Over the years CATA has been liberal in its interpretation of eligibility, has allowed wheelchair users to self-certify that they are in a wheel chair and cannot ride a regular bus with a lift, and has relied on a health care professional’s assessment to determine who else qualifies for the service. As a result, there are many riders taking advantage of ADA complementary paratransit who clearly can (and do) ride fixed-route buses.
Hugh Mose further stated that at some point CATA is going to need to reconsider its approach to eligibility for ADA complementary paratransit. Although the number of paratransit users is miniscule compared to the number of fixed-route riders, and the overall use of the CATARIDE program is declining, the number of non-senior wheelchair users, the subset of ridership that requires the highest subsidy, is on the rise. On the other hand, allowing people in wheelchairs to use paratransit if they are willing to do so minimizes the impact they have on the capacity and schedule adherence of fixed-route buses. Given CATA’s current financial situation, this may be a good time to tackle this issue, but if a change is made, it is going to be a major undertaking for the staff, and a very contentious issue for those riders who are affected and their advocates.
The consensus of the Board was to ask staff to provide the Board with specific data on how many people will be impacted, the reduction in cost of paratransit and the cost of administration of a change.
M. Bus Fleet Replacement Program
Hugh Mose reported that four years ago, recognizing that many of the buses in its fleet would reach the end of their service life at about the same time, the Board asked the staff to develop a fleet restoration plan which was subsequently adopted by the Board. Over the ensuing years CATA has been pursuing the program, although for a variety of reasons the refurbishment program has included more buses than initially called for, and bus replacement efforts have been delayed by over a year. Hugh further reported that CATA has also taken possession of nine previously-owned buses that will need replacement or rehabilitation, and it has discovered that the replacement of CNG tanks complicates disposition plans.
Hugh Mose stated that when it looked like CATA might be able to acquire some additional used-but-still-useful buses from the Georgia Regional Transportation Authority, the Board directed that any recommendation to add more used buses to the fleet should not be made in the absence of an updated Fleet Plan. It was expected that a proposal and plan for the Board would be available at this Work Session, but the buses under consideration are no longer available and the update of the plan is still being conducted.
Louwana Oliva reported that it is still important to update the Fleet Plan, because by 2011 all but four of CATA’s 61 buses will be at least ten years old. An updated plan and recommendations will now be made at the January meeting.
N. Capital Planning
Hugh Mose referenced a spreadsheet that showed CATA’s Capital Improvement Program going out five years, which was taken directly from the FY 2010/11 Budget Document. Hugh stated that this item was on the agenda as a reminder to the Board of those major investments that the staff believes CATA will need to be making over the coming years, and to clarify how important it will be to aggressively pursue federal earmarks, CMAQ and JARC funding, and any other discretionary funding that may be available.
Hugh Mose stated that the possibility of utilizing a bond issue to fund the facility expansion would be explored.
Chairman Spychalski adjourned the meeting at 7:57 p.m.
VI. Executive Session
Scheduling of an Executive Session to discuss personnel matters was deferred to a later date.