Joel Volinski, Director. National Center for Transit Research University of South Florida
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1 Lessons Learned in Transit Efficiencies, Cost Reductions, and Revenue Generation Third Edition Joel Volinski, Director National Center for Transit Research University of South Florida February 10, 2011 CUTR Webcast Series 1
2 Study Objective Identify cost saving and revenue generation techniques that produce the least harm to passengers Share the information gained with the entire transit industry People seldom improve when they have no other mode but themselves to copy after. 2
3 Methodology Direct s sent to 600 managers using APTA s electronic directory Follow F up phone calls and s Literature/Internet Research 3
4 Results of Surveys Responses received from 94 agencies Over 200 techniques were reported Some were significant, and others minor, but all are evidence of systems trying to do their best 4
5 Painful Recession-driven Choices Layoffs Hiring Freezes Wage Freezes Furloughs Elimination of Vacancies Reduced training and professional development Deferred Maintenance/Reduced Capital 5
6 Impacts to customers and personnel 84% of agencies reported they are considering i raising fares or cutting service 59% already had done so by April % predict budget shortfalls for FY2011 CTA and NYCT laying off over 1,000 employees each MARTA planning for a 25% cut in service 6
7 Managing resources is critical Creativity/desperation i i i is still alive and well The structural problem is huge, but agencies can still help themselves These techniques might not bridge the budget gap, but they demonstrate the agency is doing all it can with what it has 7
8 Customer suggestions on how to bring in new revenue Put snowplows and salt spreaders on buses for snow removal and charge the city Allow furniture companies to demonstrate their wares inside transit stations For a fee and after a little training, let people experience what it is like to drive a bus Reserve a train car for singles who want to mingle sponsored by match.com 8
9 Marketing and Advertising New York, Chicago, and Santa Monica are exploring digital LED advertising on the sides of buses 9
10 Marketing and Advertising Phoenix/Denver now wrap light rail trains and expect $350,000 /$1.1M in revenue annually 10
11 Marketing and Advertising Star Metro is buying its own vinyl wrap printer for $30,000 and will print their own ads and produce wraps and banners for others 11
12 Audio Advertising on Buses Dayton, t Champaign-Urbana, Ub TARTA, and KCATA now have audio ads timed to promote businesses along routes Partnership of Continental radio/gps system and Commuter Advertising developed on-board messaging KCATA gets 40% of revenue, expects $60,000 in the first year (no start up costs) Agency announcements have priority 12
13 Marketing and Advertising Metro t in Minneapolis has sold the naming rights for its rail station (Target) NYCT gives exclusive rights to advertisers at stations (station domination) Cleveland sold the naming rights to BRT 13
14 Purchasing/Procurement NJT purchases all fuel for its contracted services to lower cost and avoid tax saving $250,000 Red Rose Transit reduced banking services by $25,000 by seeking bids Tri-Met reduced printed schedule costs by $30,000 by printing only when needed 14
15 Purchasing/Procurement (continued) 88 vendors voluntarily participate in an SFRTA Deficit Reduction Plan. 88 vendors have reduced their prices between 3 and 10% resulting in $3 million in savings per year (CTA saves $2 million) UTA contracted out for cleaning services to save $200, NCTD purchased 28 Star Tran buses saving fuel costs and capital dollars 15
16 Revenues/Savings from facilities Lynx and CTA leased empty office space in their facilities to earn $155K and $1 million Long Beach Transit has audited their electric, water, and waste procedures and cut costs by 15% TARC reported cost reductions of 55% in HVAC of their bus garage Rockford Mass Transit built a body shop and reduced cost of body work by 50% through lower hourly cost and no mark up on parts 16
17 More revenue from facilities Red d Rose Transit earns $20, a year from leasing its radio tower to cell phone companies MBTA will earn $1 million a year from billboards they will have erected on their properties 17
18 Controlling Health Care Costs Chittendond County switched from a premium based co-pay to a high deductible plan saving hundreds of thousands Akron Metro outsourced FMLA management and had a 15% drop in FMLA usage 18
19 Controlling Health Care Costs Stark Area Regional Transit instituted FSA savings plans for pre-tax payment of health care costs and established a self-insured layer to hospitalization care, saved $350,000 a year BART provides a medical opt-outout for those with access to other insurance AC Transit hired a consultant to monitor workers comp and review medical billing and saved $930,000; 000 KAT had WC agent speak to operators to show impact 19
20 Better Management Process GCRTA established Transit Stat for data driven management decisions based on team review of performance to save $15 M over two years MDT used the Six Sigma process to reduce warranty cycle time from 96 days to 55 days and reduce percentage of buses down due to parts from 10% to 2.6% MARTA s improved attendance analysis saves the agency $4M 20
21 Greater use of partners Rochester-Genesee s Business Development Program works with education, non-profit, and private companies to subsidize service 21
22 Greater Use of Partners Monterey TD partners with local military installations that use the Federal Transportation Incentive Program-Mass Transit Benefit to pay for 11 new routes and earn $2 million (10% of total revenue and 16% of total boardings. Nashville s Easy Ride program works with Nashville s Easy Ride program works with colleges and State and County offices to subsidize transit for their employees 22
23 VRT performs vehicle emission inspection services for State DMV for $28 per test 23
24 VRT earns fees for administering DMV vehicle registration (3% for first $500K, 5% for everything above) 24
25 Savings in Operations SW Transit in Minneapolis reached an agreement to park their express buses at fairgrounds on the edge of downtown to save $100K NCTD contracted out the operations of their entire bus system and avoided d a 25% service reduction at same cost San Joaquin replaced fixed route and paratransit services with route deviation to reduce costs per trip from $50 to $19 SARTA saves $200K by reduced idling MUNI can save $3M consolidating stops 25
26 Savings in Paratransit TARC uses Yellow Cabs to fill in only when needed to carry paratransit trips, saving $300,000 through reduced trip costs, better fuel mileage, and smaller fleet CCCTA s Community Connection program provides vans to non-profits who provide ADA- eligible trips saving $350,000, reducing trip costs from $26 to $.79 and adding 4.6% more trips at no extra cost 26
27 Savings from Better Planning Rochester Genesee ss formalized route productivity evaluation program has saved millions LAMTA route restructuring eliminated 145,000 hours of duplicative or nonproductive service MDT utilized data from automated fare collection system that saved $12 million with little effect on ridership 27
28 Technology Server virtualization allows Omnitrans to consolidate servers from 75 to 57 and eventually to 12 to save $100K on replacement; web-based data warehouse consolidates various applications saving $400K and lots of time RTD is using thin clients rather than PCs (eliminating hard drives) saving all information to main servers. This reduces set up and maintenance time, uses.10% of energy, lasts three times longer and is 90% recyclable 28
29 Technology in Facilities Ak i i LEEDS ifi d Akron s new transit center is LEEDS certified and will achieve ROI in less than ten years through solar panels and geothermal wells 29
30 Other Techniques Boca Raton has developers and businesses make one-time or annual voluntary contributions based on square footage and/or traffic impacts Miami-Dade s Managed Lanes are working as intended and bringing in sufficient revenue to fund transit services in the corridor 30
31 EMP Engine Cooling System Replacing hydraulically-driven cooling fans with 8 smaller electric fans saves 700 gallons of diesel a year - payback is 3 to 5 years 31
32 Other Maintenance Techniques Rebuilding b friction plates in Voith transmissions i rather than buying new saved Tri-Met $250,000 Indygo reduced overtime in their maintenance shop from 20% to 9% with an Ellipse planning and scheduling gpackage saving g$ $500,000 32
33 Low-Tech Grounds Maintenance 33
34 For More Information Joel Volinski, Director, NCTR
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