Draft 2012 Budget Summary

Introduction

Intercity Transit’s 2012 budget is driven by the policy and action strategies outlined in its 2012-2017 Transit Development Plan (TDP) and 2012-2017 Strategic Plan. Updated each April, the TDP defines the basic public transportation services Intercity Transit will provide over the next six years using a financially constrained operating model. The Strategic Plan, to be adopted mid-November, includes specific detail on agency policy positions, service levels and corresponding resource assumptions, and the updated financial plan for the next six years. The Strategic Plan also defines Intercity Transit’s capital program and the infrastructure investments necessary to implement the corresponding service levels and policies. The financial forecast for the first year of the Strategic Plan sets the limit on budget expenditures for the 2012 budget.

The proposed 2012 budget includes a very modest 1-percent service increase and a few new discretionary expenditures. It also includes the continuation of several major capital projects, namely the early work on expansion of the maintenance and operations facility (also known as the Pattison Street facility), the Olympia Transit Center expansion, both of which have been operating beyond capacity, and the development of the Hawks Prairie Park-and-Ride facility adjacent to the congested I-5 corridor in northeast Lacey.

The agency also will purchase fleet vehicles used mostly to replace aging buses and vans. This includes purchase of seven new hybrid diesel-electric coaches, ten Dial-A-Lift vans, and 46 vanpool vans.

The 2012 budget details the expenditures required to implement the service levels and policies outlined in the first year (2012) of the six-year Transit Development and Strategic Plans. The budget development process is an opportunity for the public and the Intercity Transit Authority to determine whether or not the benefits of implementing the policies, service levels and capital projects defined in these plans justify the costs.

Background

The 2012 budget includes a significant amount of capital funding carried over from 2011, $16.3 million of this is dedicated to the three aforementioned projects – the expansion of the maintenance and operations center (Pattison Street) facility, the Olympia Transit Center expansion, and the Hawks Prairie Park-and-Ride. The 2012 budget also includes:

Upgrading the Maintenance facility by installing catwalks for employee safety and purchasing a new air compressor/dryer.
Painting the Amtrak Centennial Station interior.
Enhancing bus stops to improve their accessibility and installing energy efficient solar lighting.
Upgrading the Pattison Street facility lighting.

New capital projects for 2012 are relatively minor and include:

Replacing several older staff vehicles, including the purchase of one all-electric vehicle.
A fiber optic project to provide high-speed network connections between the Intercity Transit headquarter facility (Pattison facility), the Olympia Transit Center, and Emergency Operations Center

2012 Budget Highlights

The proposed 2012 Intercity Transit total budget is $58,738,543 of which $33.3 million is for operations and $25.4 million is for capital improvements. This budget proposes to:

Slightly increase service by adding a small amount of intercounty service between Olympia and Tacoma and adding Dial-A-Lift hours.
Project an 8-percent increase in sales tax revenue.
Complete the Olympia Transit Center expansion design and engineering work and begin its construction.
Provide a 2-percent general wage increase for non-represented employees and maintenance employees represented by the International Association of Machinists (IAM). The 2012 wage rate for transit operators represented by the Amalgamated Transit Union (ATU) will be determined through collective bargaining on a new agreement effective January 1, 2012. The proposed budget assumes no general wage increase for ATU represented employees.

New Staff Positions

The 2012 budget includes some new staff positions, primarily for Operators to enable the additional service support for fixed-route and Dial-A-Lift, as well as the following:

An Environmental & Sustainability Coordinator will assist with the implementation and continuing administration of the agency’s ongoing Environmental Sustainability Management System effort.
A Youth Education Program Assistant, a grant-funded temporary position, will support the additional work in the agency’s successful and growing youth education program.
An Automotive Technician will allow the agency to maintain the automotive fleet efficiently, meet Preventative Maintenance standards, and support the timely integration of new vehicles into service operation.

Conclusion

The 2012 budget allows a modest service increase and focuses on delivering quality transportation services and continuing major capital projects, most of which are funded through existing grants.

Intercity Transit enters 2012 in a good financial position due to the passage of the sales tax increase in August 2010 and continues to be successful obtaining both federal and state grant funds. However, the agency also faces an uncertain future given the continued economic recession and unstable recovery. The sudden and rapid rise in fuel price significantly increased costs in 2008. This, followed by the equally fast decrease in 2009, made budgeting for these costs extremely difficult. We are taking a conservative approach by forecasting a fuel price below the 2008 peak, but above the 2011 average.

This budget addresses the transportation needs of our growing community and continues Intercity Transit’s commitment to sustainability and sound environmental practices. We continue to be a public transportation agency committed to providing mobility to all and supporting a healthy, livable, and prosperous community -- environmentally, economically, and socially.