HomeMy WebLinkAboutStaff Report 4.A 6/16/2014Agenda Item #4.A
DATE: June 16, 2014
TO: Honorable Mayor and Members of the City Council through City Manager
FROM: Dan St. John, F.ASCE — Director, Public Works & Utilities
Joseph Rye — Transit Division Manager
SUBJECT: Public Hearing and Resolution Authorizing the Increase of Cash Fares for
Petaluma Transit and Petaluma Paratransit
It is recommended that the City Council conduct a public hearing, accept and consider comments
and adopt the attached resolution authorizing the increase in cash fares on Petaluma Transit and
Petaluma Paratransit effective August 2014.
BACKGROUND
Petaluma Transit (PT), like all transit agencies, charges fares to help offset a modest portion of
its operating costs. PT's last fare increase was in July 2010. The 2012 Short Range Transit Plan
programmed a fare increase for FY 2013-2014, which was not implemented. A fare increase at
this time is necessary for Petaluma to:
• Remain eligible for Transportation Development Act (TDA) funding
• Increase operating revenues to the transit agency
• Align PT fares with other neighboring transit agencies
Petaluma Transit's primary source of operations funding is TDA funds derived from a''/4 cent
statewide sales tax that is returned to communities based upon population. One of the eligibility
criteria TDA requires is that transit agencies in designated U.S. Census Bureau urban areas must
derive at least 20% of their operating costs from the sale of fares and passes. Sales of advertising
can also be used to augment the total fares and pass sales when calculating a transit agencys
fixed route "farebox recovery ratio". The rate is calculated as follows:
Farebox Recovery Ratio (FBR) equals total revenues from fares, passes, and sales divided by
total operating costs.
In the Bay Area, the Metropolitan Transportation Commission (MTC) is responsible for
distribution of TDA funding and monitoring adherence to all TDA finding rules and
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performance criteria, including FBR. MTC has local option sales taxes such as Sonoma County's
Measure M as additional "other local revenues" and included it with fares, passes and ad revenue
in calculating the FBR to help Petaluma, as well as the majority of other transit agencies in the
Bay Area suburbs, to exceed the TDA 20% FBR requirement. Without this interpretation of
TDA law, allowing other local revenue, the FY 12-13 FBR for Petaluma Transit was 16.2%.
With the allowance of other revenue (Measure M funds that go to Petaluma Transit), the FBR for
Petaluma (combined fixed route and paratransit) was 27.3 %.
The following table compares local fares and passes of neighboring transit agencies.
$1.50 $1.25 $0.75 $50 $25 $25
$135 $1.05 $0.60 $62.50 $47 $31.25
$2.00
$1.00
$1.00
$80
$40
$25
$1.75
$1.50
$0.85
$56
$44
$28
$1.50
$1.00
$0.75
$48
$33
$24
While enjoying an unprecedented increase in ridership in recent years, PT still struggles with a
FBR of only 16.2% in FY 2013 if Measure M revenues are not taken into account. A modest
fare increase, especially when accompanied by service augmentation, such as the proposed
August 2014 initiation of night service, will help PT approach its TDA funding requirement of
20% FBR.
MTC is encouraging the standardization of fares regionally. By implementing the proposed fare
increase, PT would be aligned with Santa Rosa CityBus, which charges a simple "base fare" of
$1.50 for adults.
On the Petaluma Paratransit side of operations, FTA regulations limit paratransit to no more than
double a one-way cash adult fixed route fare for basic ADA complementary service as provided
by Petaluma Paratransit.
The following table compares neighboring paratransit fares in the region and shows that
Petalmna Paratransit fares are generally equal to regional peer agencies.
TDA law requires Petaluma Paratransit to realize 10% of its operating costs from passenger fares
and advertising revenues. As on fixed route systems, MTC includes Measure M funding in the
calculation allowing Petaluma and other paratransit providers to "comply" with the 10% goal.
Excluding Measure M funds, Petaluma Paratransit's FBR in FY 2013 was 5.2%.
The 2012 Short Range Transit Plan (SRTP) anticipated a fare increase for FY 2013-2014.
Implementing the fare increase in FY 2014-2015 would follow the SRTP financial direction,
albeit late. Delaying the next fare increase to a later date without a significant and long -desired
service improvement would be less palatable to PT riders.
The proposed action meets Council Goal: "Achieve fiscal stability and maintain financial
sustainability".
MTC has not indicated that they intend to change their policy of allowing credit for local option
sales tax funding such as Measure M in the TDA Farebox Recovery Ratio calculations. Because
marry metropolitan transportation planning organizations do not consider local transportation
taxes in the farebox calculation, it is possible that MTC could consider and implement a policy
change. If such were to come to fruition, it should be noted that failure to meet the TDA
requirement of 20% FBR can result in reduced TDA funding in the future. The reduction would
be the difference between the transit agency's FBR and the 20% standard.
The Transit Advisory Committee (TAC) recommends that the adult and
senior/disabled/Medicare cash fares be increased, while the student cash, and all other
monthly/quarterly passes remain at the current pricing levels, as summarized below:
Proposed Fares
Type
Proposed
Current
Adults
$1.50
$1.25
Students
$1.00
$1.00
Senior & Disabled
(Medicare)
$0.75
$0.50
Paratransit
$3.00
$2.50
No price increase is recommended for unlimited ride passes because they speed up operations,
and induce frequent trip taking once purchased. During the last fare increase in 2010, senior cash
fares were not increased. Most seniors that ride pay cash because it would require 30 one-way
trips per month to justify purchase of an unlimited ride Senior & Disabled pass for $15. Raising
the senior cash fare to $.75 will induce more sales of the monthly $15 senior pass.
TAC recommends continuing to price Petaluma Paratransit one-way fares at double the adult
fixed route rate to follow industry standards. This would raise the paratransit fares from $2.50 to
$3 for a one-way trip. TAC voted to recommend the fare increase as contained in this report at
their June 5, 2014 meeting. TAC also recommends setting the price of the 12 -ride, "rider card" at
$33 rather than $36, to mitigate the fare increase slightly for regular paratransit riders.
In conjuction with the fare increase, it is also recommended thatfixed route travel for all ADA -
eligible Petaluma Paratransit riders be provided for free, with a valid ID card. Free travel training
will continue to be offered to existing paratransit riders who wish to learn how to use the fixed
route system. This will serve to expand the travel options for many seniors who are eligible to
use paratransit under ADA law, but are physically able to use fixed route for some trips by
giving them a financial incentive. More seniors would be referred to the travel training program.
FINANCIAL IMPACTS
PT anticipates an increase of $2,000 in fare revenue per month based on an average of 8,000
adult cash riders paying $.25 more per trip in increased cash from adults. In addition, cash
paying seniors and disabled should increase revenue by $750 per month. On an annual basis,
these two fare increases will generate an additional $33,000 in fare revenue, which would boost
PT's FBR from 16.2% in FY 14 to over 18% in FY 15. This will highlight the City's good faith
effort at TDA firebox recovery ratio compliance.
ATTACHMENTS
1. Resolution
4
Attachment 1
PUBLIC HEARING AND RESOLUTION AUTHORIZING THE INCREASE
IN CASH FARES FOR PETALUMA TRANSIT AND PETALUMA PARATRANSIT
EFFECTIVE AUGUST 2014
WHEREAS, the funding sources upon which the City operates Petaluma Transit and
Petaluma Paratransit require compliance performance standards, specifically with Transportation
Development Act (TDA) farebox recovery ratio, requiring urban transit systems to recover 20%
of overall operating costs from passenger fares, a fare increase is necessary:
Adults
$1.50
Students
$1.00
Seniors/Disabled
$0.75
Paratransit
$3.00; and
WHEREAS, staff and Transit Advisory Committee have thoroughly discussed the need
for the fare increase over multiple recent meetings, and have identified the optimal time to
implement the needed fare increase is at the same time as the expansion of evening service; and
WHEREAS, the City has conducted outreach with the riding public and the Transit
Advisory Committee to refine the options under consideration, including review of these
proposed changes at multiple Transit Advisory Committee meetings on March 6, April 3, and
May 1, 2014, and through public workshops held on April 23, and May 6, 2014, at the Petaluma
Community Center, the Petaluma Senior Center, at the Eastside Transit Center, and advertised on
the transit website, buses, and bus stops, with comments received in person, via the web, and by
phone; and
WHEREAS, in accordance with City policy and Federal Transit Administration (FTA)
regulations that apply to all FTA grantees, sufficient public notice has been posted regarding the
intent of the City Council to hold a public hearing to consider a fare increase.
WHEREAS, the Transit Advisory Committee recommends approval of the fare increase
as described in this staff report and resolution.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of
Petaluma hereby authorizes modification to the cash fare structure, as follows:
Adult fare Increase from
$1.25 to $1.50
Student fare No Change
$1.00
Seniors/Disabled fare Increase from
$.050 to $.075
Paratransit fare Increase from
$2.50 to $3.00 per one way