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MILWAUKEE COUNTY’S TRANSIT CRISIS

MILWAUKEE COUNTY’S TRANSIT CRISIS. Rob Henken, President November 2008. Purpose of Report.

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MILWAUKEE COUNTY’S TRANSIT CRISIS

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  1. MILWAUKEE COUNTY’S TRANSIT CRISIS Rob Henken, President November 2008

  2. Purpose of Report “The primary purpose of this report is to ensure that policymakers understand and acknowledge the dimensions of the problem facing MCTS. What is most critical is that they act immediately to implement realistic short‐term and long‐term fiscal solutions, or develop a plan for strategically ramping down transit service in a manner that will cause the least harm to riders and the local economy.”

  3. MCTS operating expenses (millions)

  4. MCTS fuel expenses, 2000-2008

  5. MCTS fringe benefit expenses Source: National Transit Database

  6. MCTS operating revenue (millions)

  7. Indexed growth of MCTS fixed-route revenue sources

  8. Federal funds available

  9. Use of federal funds: new bus purchases vs. operations

  10. Paratransit operating expenses

  11. MCTS bus service and ridership decline

  12. Rider profiles - 2007

  13. MCTS and peer systems – Cost effectiveness

  14. Funding projection assumptions • The Federal earmark for bus purchases doubles from $1.5 to $3 million per year. • Farebox and other transit revenue each increase 3% per year. • Operating expenditures increase 3.5% per year. • State operating assistance increases 2.5% per year. • Federal 5307 formula funds increase by 1% per year. • County property tax levy remains flat. • The entire $4.3 million in banked Federal capitalized maintenance reserves is utilized in the operating budget in 2009.

  15. MCTS funding projections (millions)

  16. Year-to-Year Options • Divert property tax dollars from other County functions • Increase property taxes • Re-bid transit management contract • Raise paratransit fares, cut paratransit service and/or increase the paratransit charge to human services programs • Continue to raise fares and cut service

  17. MCTS funding projections (millions) – including vehicle registration fee and BRT

  18. Milwaukee County – sales and gas tax scenarios

  19. MCTS 2009 Budget • Good news: no service cuts, no paratransit fare increase, moderate fixed service fare increase. • Bad news: uses all but $1 million of remaining capital “reserve”, increases charges to Aging and Disabilities, relies on one-time health care savings, extra $542,000 to maintain old buses. • Bottom line: nothing has been done in 2009 budget to address impending crisis, leaving huge potential problem for 2010 barring state legislative action and/or airport sale or lease.

  20. Conclusions • A striking structural imbalance has been building for years. Spend‐down of reserves and deferral of bus replacements has averted full‐fledged crisis, but time is about to run out. • Recent U.S. News and World Report article details fiscal crises facing other transit systems; notes that federal transportation trust fund will run out of money next year, suggests answers must come from local revenue. • A matter of priorities. No silver bullets. Increased efficiency a laudable goal, but likely not a source of significant savings. Which will it be - enhanced revenue or severe cuts in service?

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