SR-1000-001-01 (3)
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COUDCll Meetlng:
2/25/86
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Santa Monlca, Cal~fornla
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TO: Mayor and City Councll
FROM: Clty Staff
SUBJECT: Approve Short Range Translt Plan and Author1ze the City
Manager to Flle Applications for Funds
Introduction
ThlS report requests that the C1 ty counCll approve the Short
Range Translt Plan (SRTP) and authorize the C1ty Manager to flle
the Plan with the Los Angeles County Transportatlon Commlss1on
(LAcTC) and the Southern cal1fornla Associatlon of Governments
(SCAG), 10 order for the Santa Monlca Munlcipal Bus Llnes to
remaln ellg~ble for Federal and State tranSl t grant funds. In
addl. tlon, thlS report requests that Cl ty Councll authorlze the
C1ty Manager to flle appllcatlons for funds made available by the
Transportatlon Development Act (TDA) and State Translt Assistance
Fund (STAF) after the SRTP has been approved by SCAG and LACTC.
The deadl~ne for flllng thlS year's Plan is March 14, 1986.
Coples of the SRTP are avallable in the Clty Caunell offlce and
clty Clerk's offlce.
Background
The Mun1clpal Bus Llnes 15 requlred each year by the Federal
government to submlt a SRTP cover1ng a flve-year period. The
Plan exam~nes eXlstlng serVlces, proJects future needs for
serVlce and equipment, and presents two flve-year flnanclal
b-E
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Councll Meetlng: 2/25/86
Santa Mon~ca, Ca1~fornia
plans.
Th~s year1s SRTP 1S an update to last year's report and
covers flsca1 years 1987-199l.
Whlle the primary purpose of the SRTP is to provide budget
~nformat1on and just~ficatlon to LACTC for use ~n maklng
allocatlons for FY 1986-87, the Plan does provlde a prO]€ctlon of
future years based on the lnformat~on currently avallable.
F~nancial projectlons for FY 1986-87 wlll serve as the baS1S for
preparation of the Transportat1on Department budget which w~ll be
cons~dered by the City counell durlng the Clty budget process.
Fiscal years beyond 1986-87 w~ll agaln be addressed ln next
year's verSlon of the Plan and In future Clty budgets.
Preparatlon of the SRTP ~5 flnanced 80 percent by the Urban Mass
Transportatlon Admln~stratlon (UMTA) and 20 percent by TDA funds
allocated for this purpose.
The Plan this year was prepared by
ATE Management and SerVlce Company, with substantial lnput from
the Transportat~on department staff, under a contract approved by
the Clty Councll.
The SRTP lS prepared ln accordance with
gUldel~nes developed by UMTA, SCAG and LAcTC.
In Ilne w~th the SRTP gUldelines, the document presents an
overview of the Munlc1pal Bus Llnes (Chapter l), evaluates
exist~ng cond~ t~ons of serv~ce and facill tles (Chapter 2) and
then
presents
a
f1ve-year
f1nancial
plan
(Chapter 3).
Projectlons for future years are based on financ1al assumptlons
developed by LACTc. Th~s year, LAcTC requlres that two separate
f1ve-year flnanclal plans be developed:
one based on the
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CounCll Meet1ng: 2/25/86
Santa Monlca, Cal~fornla
avallab1l1ty of Federal funding aSSlstance, the other assum1ng
the delet10n of Federal funds.
It should also be noted that, ~n accordance wlth new Federal
gUldellnes lssued by the UMTA on January 24, 1986, this year's
Plan also describes in Sectlon l.4, the C~tyls process for
involvlng the prlvate sector 1n the C1ty'S transportatlon
programs.
In order to actually rece1ve the subs1dy funds 1dent1f1ed ~n the
SRTP, appl~catlons must be f~led wlth UMTA, SCAG and LACTC, In
conformance wlth app11cable gUldellnes.
F~nanc~al Analysis
OUTSIDE FUNDING SOURCES
The followlng 15 a descrlpt10n of the four major outs~de revenue
sources ut1lized ln the Plan and the current outlook for each.
l) Federal Transit Operatlng Ass1stance
The Reagan Admin1strat1on has again announced ltS lntent~on to
el1ffi1nate federal operatlng assistance for trans1t systems
through the FY 1986-87 federal budget process. Although Congress
has not concurred wlth maJor program cuts ln the past, the newly
enacted Gramm-Rudman Amendment makes substant1al cuts or total
el~mlnation of transit operating assistance more l~kely. If
implemented, thlS would mean a potent1al loss to Santa Mon1ca of
$2.2 m~l11on annually.
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Councll Meet~ng: 2/25/86
Santa Monlca, Cal~fornia
The effect of th~s loss is reflected in one of the two budgets
prepared under SRTP gUlde1~nes.
2) Transportatlon Development Act (TDA) Art2cle 4 Funds
TDA Article 4 Funds, which are der~ved from sales tax revenues,
are available for trans~t operatlng and capltal purposes. TDA
funds have hlstorlcal1y ~ncreased In proport~on to the r~se ln
retail revenues.
The LAcTC is project~ng that TDA revenues for
FY 1986-87 wl11 r1se f~ve percent from FY 1985-86.
For Santa
Monlca,
the resul tlng
subs1.dy flgure
for FY
1986-87
1.S
$7,197,000.
Flsca1 years 1987-88 through 1990-9l are projected
to lncrease at f1ve percent per year.
3) State Translt Assistance Fund (STAF)
The STAF der~ves ltS revenue from State budget appropriations of
gasollne sales tax fund accordlng to a compl~cated formula.
Annual appropriatlons are subJect to the State budget process.
The SRTP assumes these approprlatlons wl11 be made.
Based on
LACTc's lnstructions, Santa Monlca's share for FY 1986-87 w111 be
$653,000 and ~s proJected to rernaln constant during the flve-year
plann~ng perlod.
4) Proposltlon A Fundlng
As a result of Proposltion A, passed by Los Angeles County voters
~n 1980, one-half percent of the County's sales tax proceeds are
to be used for tranSl t purposes.
Twenty-f~ve percent of these
funds (Local Return Funds) are d~str~buted to each c~ty In the
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Council Meet~ng: 2/25/86
Santa Monica, California
County based on its proportional share of the County populatlon.
W~th the end of the Fare Reduct10n Program on June 30, 1985,
40 percent of the Propos1tion A Funds (Dlscret~onary Funds) are
allocated at the dlscretlon of LACTC.
The remalnlng funds, 35
percent, are allocated for rall purposes. Santa Monlca Mun1c1pal
Bus L~nes is e1~glble to receive fundlng from the Proposit1on A
Local Return Program and the PrOposlt1on A Discret~onary Program.
a) Proposltlon A D~scretlonary:
The LACTc allocates the 40 percent D~scretlonary Funds among the
County's translt operators subJect to the adoption of a
Memorandum of Understanding (MOD) between each operator and the
LACTC.
Wl thln the Dlscret~onary Program, two methods are ut11J.zed to
allocate funds to each tranSl t property.
The maJor portlon is
allocated based on a formula (Formula Funds), while the second
and smaller portion is allocated based on a Trans1t Performance
Measurement (TPM) Program adopted by the CommJ.SSlon J.n December
1985 (Incent1ve Funds).
As an addltlonal ~ncentlve
for eff1Clent operatlons,
the
Dlscretlonary Program provldes for some or all of the funds not
used by an operator J.n a glven year to be carried forward for a
maXlmum of two years thereafter.
In the Dlscretlonary Formula
Program, 50 percent of the unused funds may be carried over for
two years; and ~n the D~scretlonary Incentlve Program, lOO
percent of the unused funds may be carrled over for two years.
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councl1 Meetlng: 2/25/86
Santa Monlca, californ~a
Slnce Santa Monlca has not used any funds under the D~scretlonary
Program to date, lt lS ellglble to receive up to $6 mill10n In FY
1987, plus an addltional $2.9 mlllion In funds carrled over from
FY 1986.
However, lf Federal fundlng is cont~nued, the SRTP
proJects that none of these funds wlll be used in FY 1986-87 and,
lnstead, that the carryover be utll1zed to provlde addltlonal
fund~ng for FY 1987-88 and future years.
If Federal fundlng ~s
elim~nated, it 1S the availability of these Proposltion A
Dlscretionary Funds wh~ch allows the Municlpal Bus Llnes the
fleXlbllity to adjust wlthout sacrlflclng bus serVlce or ralslng
fares.
b) Proposltlon A Local Return:
For the flve-year perlod, the SRTP projects fundlng from thlS
source at only the mlnimum level requ~red by LACTC for
partlclpatlon ln the much larger Proposltion A Discretionary
Program descrlbed above.
For FY 1986-87, the Local Return
contributlon amounts to $234,000.
It should be noted that LACTc
assumes that these funds will lncrease by flve percent each year
due to increased retall sales.
OPERATING REVENUES
Operatlng revenues (fares, charter, advert~slng, interest) are
projected to remaln stable at $6.4 mllllon throughout the
flve-year perlod.
By Judicl0US use of fundlng sources and
carryover pri vlleges, the Plan projects no increase In fares,
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councll Meetlng: 2/25/86
Santa Monica, Callfornla
even wlth the loss of Federal fundlng, lf patronage and serVlce
remaln stable.
CAPITAL PROGRAM
If Federal assistance remalns lntact, the SRTP fully provldes for
the Municipal Bus Llnes I flve-year cap1tal program, including
fleet replacement, facll~ty ~mprovement, equ~pment modern1zat~on
and other capltal needs.
In additlon, thls scenarlO also
~ncludes annual contrlbutlons ln the amount of $l milllon to the
ra~l reserve program approved by the Cl ty Councl1 on July lO,
1984.
If the Federal asslstance program lS ellm~nated, the
contrlbutlons to the rall reserve program would be reduced In
future years. Also, after FY 1990, other segments of the capltal
program, includlng future reserves for bus replacement, would be
reduced.
The Munlclpal Bus Llnes' proJected FY 1986-87 capital plan would
be
the
same
under both
fundlng
scenarios.
It
lncludes
rehabllitatlon of the remalning 15 Grumman Flxlble buses and
purchase of a new rad~o system.
Recommendatlon
Clty staff recommends that the Clty Council:
l) Approve the Short Range Trans~t Plan and authorlze the clty
Manager
to
file
the
Plan Wl th
the
Los
Angeles
County
Transportatlon commlSS1on and the Southern Cal1fornla Associat~on
of Governments, and
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. .
TD:JFH:JLS:]w
councll Meet~ng:
Santa Monica, California
2/25/86
2) Author~ze the C~ ty Manager to file appl~cat~ons for funds
made avallable by the Transportatlon Development Act and the
State Trans~t Asslstance Fund.
Prepared by: J. F. Hutchlson, Director of Transportation
Janet Shelton, Senior Adm1nlstrat~on Analyst
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