Chapel Hill Transit (CHT) provides bus service for Chapel Hill, Carrboro and UNC-Chapel Hill. It is facing financial challenges to sustain current service levels due to rising costs and declining state funding. CHT presented a strategic and financial sustainability plan to address an estimated $80 million funding gap over 10 years to maintain assets and operations. The plan considers options like pursuing additional regional funding, reducing service, raising fares, and increasing local taxes or partner contributions to achieve community transit goals. Feedback was requested on strategies to ensure long-term sustainability.

1. Chapel Hill Transit
Strategic and Financial
Sustainability Plan Update
Chapel Hill-Carrboro
Chamber of Commerce
February 5, 2015

2. Today’s Agenda
• Overview of Chapel Hill Transit
–Performance Overview
–Funding Overview
–Key Challenges Overview
• Strategic and Financial Sustainability
Plan Update
• Questions and Feedback

3. CHT Overview
CHT is the second largest transit system in North Carolina, serving Chapel Hill,
Carrboro and the University of North Carolina at Chapel Hill.
Responsibilities:
 Fixed-route Bus Service (32 weekday & weekend routes)
 EZ Rider (ADA Service)
 Short and Long Range Transit Planning
 Marketing and Public Relations
 Major Transit Initiatives
Staff (210 employees):
 Operations – 165
 Maintenance – 31
 Administration – 14
Fleet (118 revenue vehicles):
 Buses – 99 (29 hybrids)
 Demand Response – 19

4. Organizational Structure
While a department of the Town of Chapel Hill, CHT is advised by the Chapel Hill
Transit Partners Committee, which provides policy and financial guidance:
• Jim Ward, Chair, Town of Chapel Hill – Council Member
• Ed Harrison, Town of Chapel Hill – Council Member
• Matt Czajkowski, Town of Chapel Hill – Council Member
• Damon Seils, Town of Carrboro – Alderman
• Bethany Chaney, Town of Carrboro – Alderman
• Julie Eckenrode, Town of Carrboro – Assistant to the
Town Manager
• Meredith Weiss, University of North Carolina at Chapel Hill – Senior Associate Vice
Chancellor for Finance and Administration
• Than Austin, University of North Carolina at Chapel Hill – Associate Director of
Transportation and Planning
• Cheryl Stout, University of North Carolina at Chapel Hill – Director, Transportation and
Parking

5. Ridership:
– 6,938,657 annual rides (FY13-14)
– Over 133,435 rides per week
– Over 80 rides per capita
• Service Miles: 2,091,748
• Service Hours: 179,044
Performance standards:
– Rides/Hour: FR – 44.3 DR – 2.58
– Rides/Mile: FR – 3.92 DR – .20
– Cost/Ride: FR – $2.53 DR – $25.15
(FR = Fixed Route and DR = EZ Rider)
CHT DeliversCHT Delivers

6. CHT Delivers
Median Time Period Performance
(Passengers per Hour)
2014 2013 2012 2011
AM Peak
Start of
service – 9:59
a.m.
62.3 49.7 53.5 39.8
Midday
10:00 a.m. –
3:29 p.m.
64.1 54.8 56.4 51.1
PM Peak
3:30 p.m. –
6:59 p.m.
49.5 42.3 43.9 38.0
Night
7:00 p.m. –
End of service
36.6 30 30.4 26.6
Weekend 39.35 38.5 37.5 29.5

8. CHT & Sustainability
• 2nd highest transit ridership in the state.
• Using ULSD we are producing as little emissions as
possible from our traditional diesel buses.
• Hybrid buses are 19% more fuel efficient than diesel
buses and produce 57% less particulate matter than
standard diesel buses.
• By putting one Articulated bus on the road CHT can
take 2 traditional buses off the road.
• By designing for public transportation in initial
development plans, CHT transit vehicles are
accommodated, thereby promoting transit as a
viable means of transportation.

10. • More than 90% of transit expenses are directly related to putting
service on the street and are subject to market rates.
• CHT makes considerable and concerted efforts to mitigate
expense increases in every category.
FY2014-15 Budget Highlights

11. • FY12-13 included first increase in partner contributions in four years.
• FY09 and FY10 included ARRA funding of about $500,000 in each year.
Funding History

12. State & Federal Funding History
• Note – State Assistance has decreased by ~$1Million since FY10-11

13. Key Challenges
• Fleet Age:
– 42 buses, 13 demand response and 12 service
vehicles need to be replaced.
• Staffing:
– Full Time Operators
– Supervisory Staff
– Additional Maintenance Shift
• Funding
• Community and Partner Goals:
– 2020 Plan
– Current and Planned Development

14. Financial Sustainability Plan
• Development of Strategic and Financial Plans:
– Organizational Staffing Assessment
– Vision and Goal Setting Process
• Consistent with 2020 Comprehensive
Plan, 2020 Focus Area Studies, Carrboro
Vision 2020 and UNC’s Development
Plans
– Develop Strategic and Long Term Financial
Plan
• Identify full range of financing strategies
to meet operating, maintenance and
capital costs

15. Financial Sustainability Plan
• Current Focus to Inform FY2016 Budget
Process:
– Capital Plan and Associated Funding
Plan
– Short-Term Staffing Plan
• Future Focus:
– Service Development
– Long-Term Staffing Plan
– Performance Benchmarking

16. Strategic and Financial Sustainability Plan

17. Significant Ridership Growth
NelsonNygaard Consulting Associates, Inc.
0
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
8,000,000
9,000,000
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
PassengerTrips
■ Source: National Transit Database
95
%
Drop in ridership
reflects 2010
service cuts

18. Significant Increase in Service Provided
NelsonNygaard Consulting Associates, Inc.
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
RevenueHours
■ Source: National Transit Database
26
%

19. Increase in Cost per Hour of Service
NelsonNygaard Consulting Associates, Inc.
■ Source: National Transit Database
68%
$0
$20
$40
$60
$80
$100
$120
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
OperatingExpenseperRevenue
Hour
Operator Salary/Wages: 53%
Fringe Benefits: 104%
Fuel/Lube: 382%
Casualty/Liability Costs: 86%

20. NelsonNygaard Consulting Associates, Inc.
Revenue Trends: Federal Funding
■ Source: Town of Chapel Hill
$-
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15

21. NelsonNygaard Consulting Associates, Inc.
Revenue Trends: State Funding
■ Source: Town of Chapel Hill
$-
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
$3,500,000
$4,000,000
FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15
-26%

22. Chapel Hill Transit – Partner Contributions
NelsonNygaard Consulting Associates, Inc.
$-
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15
UNC Carrboro Chapel Hill
■ Source: Town of Chapel Hill
49%

23. State of the System
■ Growth has Stabilized
– Ridership and service hours remained steady
– Cost increases largely reflect inflation
■ But, Impact of Growth and Expansion Still Being Felt
– Providing more service
– Cost of each unit of service increased
– Funding equation changed
• Federal and state funds flat, declining and changing
• Partner increases offset declines
■ Growth Occurred Without Corresponding Investments
• Capital – mostly vehicles but also some facilities
• Staffing – operators, mechanics, and supervisors
NelsonNygaard Consulting Associates, Inc.

24. State of the System
■ Chapel Hill Transit Operations are Financially
Unsustainable
■ $80 million (estimated) additional revenues needed
over next 10 years
– Invest in capital investments
• Buses, paratransit vehicles, technology, and park-and-ride lots
– Invest in staff and operations
• Operators, mechanics, and supervisors
NelsonNygaard Consulting Associates, Inc.

25. Opportunities

26. Potential Opportunities
■ Orange County Bus and Rail Investment Plan
■ Reduce Service Levels
■ Additional Revenue Sources (Fares)
■ Finance Vehicle Purchases/Lease Vehicles
■ Increase Local Taxes/Partner Contributions
NelsonNygaard Consulting Associates, Inc.

27. Orange County Bus and Rail Investment Plan
■ New (2012) Revenues for Transit in Orange County
– One-half Cent Sales Tax
– New or increased Vehicle Registration Fees
■ Full Year Revenues Estimated at $6.7 million – All Sources
– Most for regional services and future light rail
■ Existing Service (Chapel Hill Transit) has Access to New
Vehicle Registration Fee Revenues Only
– Estimated revenue - $338,000/yr
– 2% per year is assumed growth rate
– Already assumed in financial projections for operations and
capital
NelsonNygaard Consulting Associates, Inc.

28. Reduce Service/Operate Fewer Routes
Opportunities
■ Potential strategy to
reduce cost and demands
on capital resources
Challenges
■ Big impact on riders
■ Contrary to CHT Partner
priorities and community
goals
■ Less service results in
fewer federal and state
funds
NelsonNygaard Consulting Associates, Inc.

29. Fares and User Fees
Opportunities
■ Shares costs with users
Challenges
■ Requires capital investment
(fare boxes)
■ Will impact service
operations and staffing
■ Will impact ridership
NelsonNygaard Consulting Associates, Inc.

30. Leasing and Debt Financing
Opportunities
■ Allows CHT to acquire
vehicles relatively quickly
■ Spreads costs evenly over
several years
■ Town of Chapel Hill
already has vehicle leasing
program
Challenges
■ Current governance
structure means Town of
Chapel Hill alone would
hold the debt
■ Adds financing costs
NelsonNygaard Consulting Associates, Inc.

31. Raise Taxes/Partner Contributions
Opportunities
■ Increase funding to system
needs
■ Share burden across
partners
Challenges
■ Contrary to CHT Partner
priorities
■ Just raised taxes and
increased fees
NelsonNygaard Consulting Associates, Inc.

32. Questions/Feedback
Brian M Litchfield
Director
Chapel Hill Transit
(919) 969-4908
blitchfield@townofchapelhill.org
www.chtransit.org
www.facebook.com/chtransit
www.twitter.com/chtransit
Customer Service Line: (919) 969-4900

33. It’s about Community Goals