HomeMy WebLinkAbout28-18 RESOLUTIONm
113 West Mountain Street
Fayetteville, AR 72701
(479) 575-8323
Resolution: 28-18
File Number: 2017-0766
OZARK REGIONAL TRANSIT ADDITIONAL FUNDING:
A RESOLUTION TO APPROVE A BUDGET ADJUSTMENT IN THE AMOUNT OF$122,908.00 TO
PROVIDE ADDITIONAL FUNDS TO MAINTAIN OZARK REGIONAL TRANSIT SERVICES IN THE
CITY OF FAYETTEVILLE AT THE 2017 SERVICE LEVELS
WHEREAS, Ozark Regional Transit has calculated that, due to operational cost increases, it will have
a 2018 budget shortfall in the amount of $338,000.00 if it maintains the same level of service across its
entire service area as 2017; and
WHEREAS, without an increase in funding, the service levels for four fixed routes in the City of
Fayetteville will have to be reduced.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
FAYETTEVILLE, ARKANSAS:
Section 1: That the City Council of the City of Fayetteville, Arkansas hereby approves a budget
adjustment, a copy of which is attached to this Resolution, in the amount of $122,908.00 to provide
additional funds to maintain Ozark Regional Transit services in the City of Fayetteville at the 2017
service levels.
PASSED and APPROVED on 1/2/2018
City of Fayetteville, Arkansas 113 West Mountain Street
f f? Fayetteville, AR 72701
i7; } (479) 575-8323
Text File
- File Number: 2017-0766
Agenda Date: 1/2/2018 Version: 1 Status: Passed
In Control: City Council Meeting File Type: Resolution
Agenda Number: D. 11
OZARK REGIONAL TRANSIT ADDITIONAL FUNDING:
A RESOLUTION TO APPROVE A BUDGET ADJUSTMENT IN THE AMOUNT OF $122,908.00 TO
PROVIDE ADDITIONAL FUNDS TO MAINTAIN OZARK REGIONAL TRANSIT SERVICES IN
THE CITY OF FAYETTEVILLE AT THE 2017 SERVICE LEVELS
WHEREAS, Ozark Regional Transit has calculated that, due to operational cost increases, it will have a 2018
budget shortfall in the amount of $338,000.00 if it maintains the same level of service across its entire service
area as 2017; and
WHEREAS, without an increase in funding, the service levels for four fixed routes in the City of Fayetteville
will have to be reduced.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
FAYETTEVILLE, ARKANSAS:
Section 1: That the City Council of the City of Fayetteville, Arkansas hereby approves a budget adjustment, a
copy of which is attached to this Resolution, in the amount of $122,908.00 to provide additional funds to
maintain Ozark Regional Transit services in the City of Fayetteville at the 2017 service levels.
City of Fayetteville, Arkansas Page 1 Printed on 11312018
Don Marr, Chief of Staff
Submitted By
City of Fayetteville Staff Review Form
2017-0766
legistar File ID
1,/2/2018
City Council Meeting Date - Agenda Item Only
N/A for Non -Agenda Item
12/19/2017 TRANSPORTATION SERVICES (410)
Submitted Date Division / Department
Action Recommendation:
Approval of a budget adjustment for $122,908 to cover funding gap to maintain four Ozark Regional Transit Routes
at the same service level as prior years.
Budget Impact:
2100.410.4100.5723.00
Account Number
Street Fund
Fund
Project Number
Project Title
Budgeted Item? No
Current Budget
$
300,000.00
Funds Obligated
$
300,000.00
Current Balance
$
Does item have a cost? Yes
Item Cost
$
122,908.00
Budget Adjustment Attached? Yes
Budget Adjustment
$
122,908.00
Remaining Budget
0
Previous Ordinance or Resolution # 2017-0755
Original Contract Number: Approval Date?
Comments:
CITY OF
FAYETTEVILLE
W4ff ARKANSAS
TO: Mayor Lioneld Jordan
City Council
THRU: City Attorney
City Clerk
FROM: Don Marr, Chief of Staff
DATE: December"! 9, 2017
SUBJECT: Funding Request by Ozark Regional Transit
STAFF MEMO
RECOMMENDATION:
To approve a budget adjustment for $122, 908 ($30,727 per fixed route) to maintain Ozark
Regional Transit Services to the 2017 service levels.
BACKGROUND:
On November 30, 2017, the Ozark Regional Staff asked the ORT Board members to request an
audience with each Municipality that is a part of the ORT Inter -local agreement and where
current fixed route service levels in the urbanized area exist to discuss a budget amendment
requesting $30,727 per fixed route offered in order to meet a balanced budget for operations of
the ORT system.
Ozark Regional Transit is formally petitioning the City of Fayetteville to increase the funding
levels for Fixed Route public transit services and FTA associated ADA Para -Transit Service.
The ORT 2018 budget will realize a local match shortfall and will also realize increased
operational cost for the upcoming year The items that play into this budgetary gap are:
• Decreases in County funding and associated State funding
• Increases in labor rates from year to year
• Increases in hard costs such as vehicle parts and fuels
• Decreases in on -vehicle advertising revenue due to not running ORT's own buses,
The 2018 proposed overall budget currently reflects the expected reductions in funding and is
also reflecting the associated rural demand response service reduction in hours and labor, as
well as the removal of the private partnership sponsored route and associated service hours
and labor. Even with these calculated reductions in funding and services, ORT finds its funding
below expected costs associated with running fixed route services in NWA.
DISCUSSION:
Ozark Regional Transit has calculated its shortfall in 2018 to be $338,000 in order to maintain
the same level of services as in 2017 for fixed routes. With eleven (11) urbanized fixed routes,
the equitable distribution of this shortfall would be $30,727 per fixed route That equates to an
increase per fixed route of 14.22%. 11 % of this increase is due to operational cost increases
Mailing Address:
113 W. Mountain Street www.fayetteville-ar.gov
Fayetteville, AR 72701
realized from 2016 to 2018. The other 3.22% is attributable to the operational cost increases
from 2017 to 2018. Only an increase in funding will ensure ORT is able to compensate for
operational increases expected in 2018 and will result in enough funding associated with State
supported expense items.
BUDGET/STAFF IMPACT:
This request will cost the City an additional $122,908 ($30,727 for four fixed routes within the
City of Fayetteville AR). This will be a budget adjustment utilizing City of Fayetteville reserve
funds. With the absence of this additional funding the routes will have to be reduced and
service levels cut to the corresponding dollar amounts needed.
Attachments:
Ozark Regional Transit Funding Request Memo
Budget Adjustment
() OZARK REGIONAL TRANSIT
2423 East Robinson Avenue, Springdale, Arkansas 72764
To: City of Fayetteville
From: Ozark Regional Transit
Re: 2018 Funding Level Increase
Ozark Regional Transit (ORT) is formally petitioning the City of Fayetteville to increase the funding levels for Fixed Route
Public Transit services and FTA associated ADA Para -Transit.
ORT's 2018 budget will realize a local match shortfall, and will also realize increases in operational costs.
There are many factors that play into the causes of this budgetary gap that include:
• Decreases in County funding and associated State funding.
• Increases in labor rates from year to year.
• Increases in hard costs such as vehicle parts and fuels.
• Decreases in on -vehicle advertising revenue due to not running our own buses.
To better understand where the City's funding supports ORT routes, we have calculated the straight operational cost for running a
fixed route. This cost includes:
• Wages for Operators and Maintenance
• Associated Benefits
• Vehicle Insurance
• Uniforms
• Shop Supplies
■ Communication Equipment and Service costs
• Equipment Rental and Repair
• Fuel and Oil
This does not include:
• Wages for Support Staff or Management
• Associated Benefits
• Property Insurance
• Office Supply Costs
• Computer Hardware and Software Service costs
• Utilities
+ Travel, Marketing or Association Dues
• Other Ancillary Expenses
• Costs associated with post -fire recovery
Joel Gardner, Executive Director
479-756-5901 Main Office www.ozark,org 479-756-2901 Facsimile
Melinda Campbell, Chief Fbrancial Officer
For 2016 and 2017, the costs per route are as follows:
Average Cost per Route
2017
2016
%Difference
One Route
$185,354
$165,171
11%
Two Routes
$370,709
$330,342
11%
Four Routes
$741,418
$660,684
11%
The costs that are not associated with directly operating a route are supported financially through the fare box revenue,
advertising revenue, local partnerships with non-governmental organizations and charter fares. There is also approximately
10% of these additional costs that are paid utilizing State funding, which is only obtained by providing rural services. Now that
we are forced to cut the rural services, due to the reduction in County funding, our State grant money has been decreased by
$100,000 or close to 40%.
For 2018, ORT will have to propose an overall budget below the 2017 budget proposed and subsequent expected actuals, The
2018 budget currently reflects the expected reductions in funding and is also reflecting the associated rural demand response
service reduction in hours and labor, as well as the removal of the private partnership sponsored route and associated
service hours and labor. Even with these calculated reductions in funding and services, ORT finds its funding below expected
costs associated with running fixed route services in NWA.
On November 30, 2017 ORT staff asked that the Board members request an audience with each city we provide fixed route
services in, to allow us that audience from whom to request additional funding, in order to maintain our current fixed route
service levels in the urbanized area. ORT also offered a secondary resolution. Although contradictory to our plans to continue
public transit growth and development, it is the only other predictable alternative to keep the 2018 budget balanced; we
reduce service hours daily by 1.5 hours. Again, these are the present options that allow us to enter into 2018 with a balanced
budget.
ORT has calculated its shortfall in 2018 to be $338,000 in order to maintain the same level of services as in 2017 for fixed
routes. With eleven (11) urbanized fixed routes, the equitable distribution of this shortfall would be $30,727 per fixed route.
That equates to an increase per fixed route of 14.22%. As indicated above, 11% of this increase is due to operational cost
increases realized from 2016 to 2017. The other 3.22% is attributable to the operational cost increases from 2017 to 2018.
Only an increase in funding will ensure ORT is able to compensate for operational increases expected in 2018 and will result in
enough funding associated with State supported expense items. Due to ORT applying approximately 10% of its budget to the
State grant, for 2018, our proposed budget of $3,538,000 will have $353,800 reimbursable by that State grant.
When ORT staff began the final assembly of the 2018 budget, we took into consideration that there would be 4 less operators
needed because of the loss of the County and private funding. Even though we are reducing our overall employee pool
through natural attrition, there are some jobs and duties that cannot be reduced. While a portion of staff salary and benefits
can be attributable to the State grant, having lost that funding stream does not allow me to reduce staff hours or duties at the
non -operational and mechanical jobs level.
Over the years, ORT has maintained a lean leadership team. We have excelled in ensuring that no positions are manned or
created that are not integral to the operation of the system. Many of our staff or leadership perform multiple layers of duties
that would normally be staffed by more than one individual. However, due to our lean nature and propensity to be as frugal
as possible, we do not over -staff or open positions until it is absolutely necessary. In the 2018 budget, we are reducing the
number of operators needed to perform our daily tasks. This does not translate into reducing leadership or staff positions due
to the fact that we continue to consolidate and delegate tasks and responsibilities to our present, few positions.
It is my hope that the City of Fayetteville will review this letter of request, and grant the increase of $30,727 per fixed route
for the total of $122,908 in additional funding for 2018 budget. If you have any questions, or request further clarification of
this budget dilemma, please do not hesitate to contact me directly,
10 1, ar re , Executi a Director
Ozark Regional Transit
Joel Gardner, Executive Director
479-756-5901 Main Office www.ozark.org 479.756-2901 Fac8ittille
Melinda Campbell, Chief Financial Officer
City of Fayetteville, Arkansas - Budget Adjustment Form (Legistar)
Budget Year Division Adjustment Number
CHIEF OF STAFF (070)
2018 (BY) /Org2
Requestor: Don Marr
BUDGET ADJUSTMENT DESCRIPTION / JUSTIFICATION:
Ozark Regional Transit has requested additional funds in order maintain four routes at the same service level as in prior
years.
COUNCIL DATE: 1/2/2018
LEGISTAR FILE ID#: 2017-0766
13 Gwb1cwU1 FeW
12/20/2017 7:28 AM
Budget Director
TYPE:
DESCRIPTION:
Date
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GLDATE:
RESOLUTION/ORDINANCE
I POSTED:
f
TOTAL
122,908 122,908
v.20170707
Increase / (Decrease)
Proiect.Sub#
Account Number
Expense Revenue
Project Sub AT
Account Name
2100.410.4100-5723.00
122,908 -
EX
Transfer to -Ozark Regional Transit
2100.410.4100-4999.99
- 122,908
RE
Use Fund Balance - Current
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