AGENDA #2

Friday, February 28, 2003

Transportation Department

Initial Budget Presentation to the Mayor and Council

2003 – 2004

Mission Statement

Chapel Hill Transit’s mission is to:

· provide safe, convenient, affordable, reliable, and responsive public transportation services to residents and visitors of the Chapel Hill, Carrboro, and University of North Carolina communities,

· be accessible, efficiently operated and supportive of a healthy environment and a sustainable local economy, and to

· connect and coordinate with other transportation means in the Research Triangle area providing an alternative for local and regional travel.

The mission of the Parking Services Division is to:

• provide on-street and off-street parking for Chapel Hill’s citizens and visitors in an efficient and courteous manner, and to
• operate a parking enforcement system in compliance with the parking regulations adopted by the Town Council.

Brief Services Description

• Provide fixed route bus service, EZ rider service for the mobility challenged, and shared ride service for the communities of Chapel Hill, Carrboro, and the University of North Carolina.

• Operate the Tar Heel Express – a park and ride shuttle service for special events.

• Oversee the taxi franchise approvals and renewals according to the Town Code of Ordinances.

• Ensure compliance with State and Federal regulations.

• Ensure that statistics are reported accurately and timely.

• Manage the Town’s on- and off-street parking services.

Departmental Revenue Estimates - Transit     

Revenue Source	2001-02 Actual Revenue	2002-03 Budgeted Revenue	Estimated 2002-2003 Revenue	Estimated Revenue 2003-2004
Operating	1,062,740	274,000	286,155	298,000
Federal/State	2,482,508	2,505,708	2,497,675	2,505,708
University	2,383,322	3,866,986	3,761,372	4,282,018
Carrboro	546,675	748,786	722,561	831,956
Chapel Hill	1,900,895	2,278,328	2,198,531	2,530,614
Total	8,376,140	9,676,444	9,466,294	10,448,296

• Revenue estimates have been revised to reflect the conversion to fare-free and the resulting change in revenue flow from the partners.

• State and federal operating assistance funds continue to be shown based on recent discussions with state and federal transportation officials.

Departmental Base Budget Cost Estimates-Transit

Category	2001-02 Actual	2002-03 Budget	2002-03 Estimated	2003-04 Requested
Personnel	6,143,389	6,733,430	6,520,654	7,382,537
Operations	1,784,640	2,374,232	2,246,858	2,443,737
Capital	448,112	568,782	698,782	622,022
Total	8,376,141	9,676,444	9,466,294	10,448,296

Key Cost Issues

• Transit services were increased in October with the addition of the Jones Ferry Park and Ride lot (437 spaces) and the University’s new Friday Center lot (850 spaces).  Service is provided to these lots with 9 buses during peak hours only.

• Health insurance costs have increased for the Town.  A majority of the transit employees had the Doctor’s Health Plan and have been converted to the Cigna Health Plan.  This results in an increase of approximately $150,000 annually.  Next year’s budget amount for health insurance includes a 20% increase in premiums and would increase the cost by $134,607.  The Town is in the process of getting quotes from different providers for next year’s health insurance and we can adjust next year’s request when we have firm quotes for insurance.

• The need to replace the transit facility at the end of 2006 is resulting in the increase in the capital reserve amount.  We began to reserve money to cover the local share (10%) of the replacement facility in the 2002-03 budget.  Last year we were planning on a $1 million dollar local match for a $10 million facility.  The reserve amount in 2002-03 for the facility is $200,000.  This would have put away the needed $1 million in the 5 budget years prior to the replacement.  The annual reserve amount for the facility has been increased to $300,000 for the remaining 4 years.  This will equal a $1.4 million local match that will provide the match for a $14 million facility. This can be adjusted when the cost estimates are available.

• The local match for vehicle replacement has increased $21,160 because there are more vehicles on the replacement schedule.  The total capital reserve match increase is $121,160. 

• The 2003-04 budget request reflects a $94,963 increase in salaries compared to the 2002-03 original budget request to include the pay raises that were given in December 2002.

• The 2003-04 budget request includes a 5% reserve for pay adjustments for 9 months that equals $175,976.  The Workers’ Compensation estimate reflects a 15% increase in the premiums that equals $25,431.

• The transit computers have been purchased in the past with technology money provided from the NC Department of Transportation.  The State has eliminated computers from eligibility for technology grant money.  The annual cost for an ongoing computer replacement program is $23,464.

• The Chapel Hill Public Works crew will maintain the Jones Ferry Park and Ride lot.  This includes the grounds work and maintenance of the stormceptors.  The increased cost for Public Works to maintain the Park and Ride lot is $17,000.

• The requested amount for diesel fuel (kerosene) reflects a 5 cents a gallon increase over last year’s budgeted amount.  We budgeted $1.00 gallon last year and propose $1.05 next year.  The fuel prices for the first 6 months were favorable with a range of 68 cents a gallon to 95 cents a gallon.  The current price is $1.28 per gallon.  The increase to next year’s budget for $1.05 per gallon is $9,261.

• We purchase local radio advertising for the Chapel Hill Transit free bus program and the Tar Heel Express shuttle service to the University football and basketball game.  We began the advertising campaign in December and think it is important to continue to get the message out about the transit services offered in the community.  The increase to next year’s budget for an entire year of advertising is $17,800.

Key Programs or Services that are Going Well

• Fare-free has been well received by the community.  The ridership for the calendar year 2002 was 4.3 million and reflects a 42 per cent increase.  The last two quarters; data indicate a 55% increase in ridership.

Key Programs or Services that Could be Improved

• The demand response transit services, EZ rider, feeder services, and shared ride are growing as the transit system expands.  We are working on improving the scheduling process and hope to implement a computer scheduling software by late summer or early fall.  This should improve the service by optimizing the vehicle trips and streamlining the trip scheduling process.

Proposed Additions and Reductions

• The increased fleet size over the past 2 years without any increase in maintenance staff has made it necessary to evaluate the maintenance staffing so that we can recommend the correct number of maintenance personnel to adequately maintain the fleet.  We are working on this with transit consultants, Parsons Brinkerhoff Fleet Services division, so that we can make recommendations.

• We have increased our transit services over the last two years and have added some additional driver positions.  The Department is still challenged with having enough drivers and managing the overtime budget.  We are working with a transit operations consultant to evaluate our staffing requirement and make recommendations. 

• The half-time marketing position could be eliminated at this time.  We are advertising with local radio to get the word out about the fare free bus service.  We could use these resources to fund other more critical personnel needs.

Effect of a 5% Reduction in Budget

In order to reduce the Department budget by 5% (approximately $500,000), services would have to be cut.  In order to cut services, we would need to meet with the transit partners, Carrboro and the University, to evaluate the routes to determine agreed upon cuts in service.

PARKING SERVICES

Departmental Revenue Estimates-Off-Street Parking

Revenue Source	2000-01 Actual Revenue	2001-02 Budget Revenue	Estimated Revenue 2002-2003	Estimated Revenue 2003-2004
James Wallace Parking Deck	535,462	655,000	573,949	580,000
Lot Revenues	554,500	647,300	645,685	656,860
Tokens	13,245	12,000	8,932	9,000
Meter Fines	42,332	42,000	32,248	32,500
Other	254,712	200,00	289,585	0
Total	1,400,251	1,556,300	1,550,339	1,278,360

Departmental Base Budget Cost Estimates – Off-Street Parking

Category	2001-02 Actual Budget	2002-03 Budget Request	2002-03 Estimated	2003-04 Requested
Personnel	316,455	319,217	313,217	333,700
Operations	1,083,796	1,202,633	1,202,732	910,059
Capital	0	34,450	34,450	34,600
Total	1,400,251	1,556,300	1,550,399	1,278,359

Key Cost Issues

• The rate increases for the James Wallace Parking deck coupled with the convenience of the fare free transit system have resulted in a reduced volume of vehicles in the Rosemary Street deck during the daytime hours.  The parking deck now has available parking during the lunchtime peak period.

Departmental Revenue Estimates – On-Street Parking

Revenue Source	2001-02 Actual Revenue	2002-03 Budgeted Revenue	Estimated 2002-03 Revenue	Requested Revenue 2003-04
Meters	244,254	237,000	242,462	243,000
Tickets	375,267	400,000	358,839	365,000
Misc.	10,015	13,000	7,785	6,000
Total	629,536	650,000	609,086	614,000

Departmental Base Budget Cost Estimates – On Street Parking

Category	2001-02 Actual	2002-03 Budget	2002-03 Estimated	2003-04 Requested
Personnel	231,079	243,067	253,935	284,390
Operations	368,484	406,933	355,151	329,610
Capital	0	0	0	0
Total	599,563	650,000	609,086	614,000

Key Cost Issues

• The addition of the 5-minute grace period on the parking meters has resulted in less revenue from ticket fines but the staff has incurred fewer complaints from parkers that received a ticket within 1 or 2 minutes of the meter expiring.

• The on-street meter space lease program is off to a slow start.  The budgeted revenue from this program is $12,000 but the estimated revenue for this year is less than $3,000.  The lower demand for these types of leased spaces may warrant considering a lower fee than the $80.00 per month that an off-street parking spot brings in.