City Council

Mayor Mark S. Nexsen Lake Havasu City Vice Mayor Don Callahan Lake Havasu City Police Facility Councilmember Crystal Alger 2360 McCulloch Blvd North Councilmember Dean Barlow Councilmember Donna Brister Work Session Minutes - Final Lake Havasu City, Arizona 86403 www.lhcaz.gov Councilmember Jeni Coke Councilmember David McAtlin City Council Tuesday, January 14, 2014 5:00 PM Work Session 1. CALL TO ORDER Mayor Nexsen called the meeting to order at 5:00 p.m. 2. PLEDGE OF ALLEGIANCE The mayor led in the Pledge of Allegiance. 3. ROLL CALL Councilmember Alger arrived at 5:01 p.m. Present: 7- Mayor Mark S. Nexsen, Councilmember Dean Barlow, Councilmember Crystal Alger, Councilmember Donna Brister, Vice Mayor Don Callahan, Councilmember Jeni Coke and Councilmember David McAtlin 4. CALL TO THE PUBLIC There were no requests to address the Council. 5. PUBLIC HEARINGS 5.1 ID 14-0040 REVIEW OF FUTURE TRANSIT SERVICE OPTIONS Operations Director Gary Parsons stated that at the September 24, 2013, City Council Work Session he brought forth transit service options and the costs associated with the City’s transition to a 5307 program. He noted that transiting to a 5307 program will be mandatory beginning on October 1st of this year. He said the City Council directed staff to come back with service options that would meet a general fund subsidy between $550,000 and $600,000 with other parameters such as operating until 5 p.m. or 6 p.m. to accommodate those looking for transit rides to and from work. Mr. Parsons advised that staff looked at the pros and cons of different fares and the reality is that the City cannot meet that number and still operate until 5 p.m. or 6 p.m. Lake Havasu City Page 1 City Council Work Session Minutes - Final January 14, 2014 Mr. Parsons presented the following three options: Option I – Public Transit Program 5307 Grant $1.50 Fare Fixed Route $3.00 Fare Curb-to-Curb Mr. Parsons explained that Option I includes three in-town bus routes, with Monday through Friday service from 7 a.m. to 6 p.m., and includes the Green Route (Shops at Lake Havasu) service Monday and Friday only from 8 a.m. to 5 p.m. He added that Option I would provide curb-to-curb service for seniors and disabled persons only, and would include no Saturday, Sunday or holiday service. Mr. Parsons stated that this option would still provide for Seniors-on-the-Move. The cost of service for Option I would be $1,322,388, with $650,000 in grant funds, leaving a City subsidy of $672,388. He noted that this amount was generated anticipating approximately 70,000 rides annually. Councilmember Callahan asked if the Seniors-on-the-Move use the regular buses, to which Mr. Parsons replied no, they have their own dedicated buses. Mayor Nexsen asked if there was any thought to providing service on Friday and Saturday for the Green Route service. He said for those that work Monday through Friday, Saturday service would accommodate their schedule and would allow the City to schedule a driver for two consecutive days versus four days apart. He asked if that would be more accommodating, to which Mr. Parsons replied that the reason the City did not choose Saturday is because the rest of the service would not be open. There was further discussion regarding the transfer center and transferring riders to the Green service buses. Councilmember Alger asked for the cost of providing service on Saturdays, to which Mr. Parsons replied that it would cost approximately $150,000 annually and includes going to the Shops at Lake Havasu. Councilmember Alger then asked for the cost if the Saturday service did not include the Shops at Lake Havasu and only provided a half-day of service. Mr. Parsons said it costs the City approximately $55 to provide transit service for one hour. He reviewed all the components of that $55 per hour cost. Mayor Nexsen said if there are four routes for a half day of service that would cost the City $55 per hour per route, to which Mr. Parsons replied yes and added that does not includes routes out to the mall. Mr. Parsons further added that it is mandated by the Americans with Disabilities Act that whenever the City runs a fixed route there must also be a curb-to-curb route, which would increase the cost per hour. Lake Havasu City Page 2 City Council Work Session Minutes - Final January 14, 2014 Mayor Nexsen said, not including the route to the mall, the City would be looking at just under $1,000 per hour, times 52 Saturdays, or $45,000 a year for only a few hours of service on Saturdays. There was further discussion regarding grant funding for transit service. Option IB - Public Transit Program 5307 Grant $1.50 Fare Fixed Route $3.00 Fare Curb-to-Curb Mr. Parsons explained that Option IB includes three in-town bus routes running Monday through Friday service from 7 a.m. to 6 p.m., but does not include the Green Route (Shops at Lake Havasu). He added that Option IB would provide curb-to-curb service for seniors and disabled persons only, and would include no Saturday, Sunday or holiday service. Mr. Parsons stated that this option would still provide for Seniors-on-the-Move. The cost of service for Option IB, at 60,000 rides annually, would be $1,285,886, with $631,749 in grant funds, leaving a City subsidy of $654,137. Option II – Senior & Disabled Persons 100% City Funded $3.50 Fare Mr. Parsons explained that Option II includes curb-to-curb service for seniors and disabled persons as well as qualified low income and veterans, running Monday through Friday from 7 a.m. to 5 p.m., but does not include the Green Route (Shops at Lake Havasu). He added that Option II does not include Saturday, Sunday, holiday or County service. Mr. Parsons stated that this option would also provide for Seniors-on-the-Move to the Senior Center only. Mr. Parsons added that with Option II there would be bus purchase assistance from the Arizona Department of Transportation (ADOT). The cost of service for Option II, at 20,000 rides annually, would be $600,000 in City funds. Mr. Parsons added that there are no grants available to help the City operate this option, unlike a 5307 program, which dramatically reduces the number of rides that the City will be able to provide. There was discussion regarding the number of riders at 7 a.m. during the winter and summer months. Lake Havasu City Page 3 City Council Work Session Minutes - Final January 14, 2014 Mayor Nexsen clarified that the City currently subsidizes $575,000 out of General Fund for transit service, to which Mr. Parsons replied that was correct. Mr. Parsons explained that the City is currently funded under the 5311 program, which is more grant funds, through September 30, 2014. He said the City could start the new program earlier to begin the process of hiring and certifying drivers which is a lengthy process. Mr. Parsons said he was hopeful that the City would be able to continue the current service until September 30th when the weather begins to cool down and then institute the shorter hours. There was discussion regarding whether the owners and businesses at the Shops at Lake Havasu and mall area would be willing to help fund transit service or advertise on the buses. Mayor Nexsen said the funding for transit service is not a one-time thing, it is ongoing. He said, for instance, at the end of a decade the City will have spent over $7 million for transit service. It is a long term decision that does not stop; however, he recognizes that there are people who need these rides. Mayor Nexsen said he would opt for Option I because the other options do not provide a great deal of savings. Mr. Parsons said the City is optimistic that State funding will return in the future. He added that there are many agencies and organizations throughout the State working hard to get the State to return local transportation assistance funds. He said those funds were worth about $225,000 to Lake Havasu City about four years ago and the City used those funds to match federal funds. Mr. Parsons added that at the peak of Local Transportation Assistance Funds (LTAF) and federal funds, the City subsidy was around $300,000 for transit service. Councilmember Callahan said he was in favor of Option I because it was the lowest price at $10 per ride, versus Option II at almost $30 per ride. Mayor Nexsen opened the public hearing. John Heinze, Jr., resident of Lake Havasu City, addressed the Council and said he was very upset to hear about transit service. He said he uses the bus service often because he is disabled and uses a monthly bus pass. He said he understands that there are cuts in busing, but there are people like him who cannot afford a vehicle. Mr. Heinze, Jr. said he spoke with people about the Green Route and they are in favor of continuing this route because it brings people out to the mall to shop and to the movies. Mr. Heinze, Jr. said Kingman has a busing system that is awesome and they are a much smaller town than Lake Havasu. He asked why the City needs white sand on the beaches when that money could be used for transit. He said if transit is cut then he will not have transportation. He asked the Council to dig deeper on how to keep funding the busing system. Lake Havasu City Page 4 City Council Work Session Minutes - Final January 14, 2014 Mr. Parsons said the City is under the same 5311 program as Kingman; however, Lake Havasu City is going to lose that program. He said Kingman’s program runs almost 100,000 miles a year less than the City’s transit service as Kingman’s commercial area is more closely compact whereas we are much more spread out. Mr. Parsons said the same goes for Bullhead City as most of their commercial area is off of Highway 95. He stated that Lake Havasu City has a lot of “dead” distance between rides that is costing the City money. Mr. Don Bergen, resident of Lake Havasu City, addressed the Council and said Lake Havasu City for several years has supported Special Olympics with a grant to transport athletes to and from practices. Mr. Bergen explained the need to continue transit service for the athletes to get to and from their games and practices. He stated that the primary responsibility of City government is to adequately serve its residents and that includes a transit system to get people to work, doctors and stores. He added that many low income residents cannot afford a car or only have one car, and many of these low income families are not just sitting collecting welfare, they are working jobs that our businesses need filled. Mr. Bergen said in addition to low income, Lake Havasu City has many elderly and disabled residents. He said if the City reduces weekday hours many may be out of a job and may have to relocate. Mr. Bergen said riders pay $1.25 a ride for transit, which is higher than Kingman or Bullhead City. He said a private shuttle service would cost them $6 to $9 a ride, and if they need wheelchair access that is $29 a ride. Mr. Bergen said he has contacted Senator Ward and Representative Borrelli. He added that four years ago the local transportation assistance funds were swept away from the State lottery to support the State General Fund even though the lottery and State General Fund are in good financial health. Mr. Bergan added that he currently sits as Vice Chairman on the Public Works Advisory Board (PWAB) which reviewed the original and revised transit options. He said the PWAB voted unanimously to not accept them as being beneficial to the City. Mr. Bergen said the transit 5311 grant is proposed to change from a good funding to a much lower funding of the 5307 grant, due to the 2010 census that put Lake Havasu City over the 50,000; however, we are not a large metropolitan area and with the current economy we have lost population and may now be well under that mark. He added that this could be why transit ridership has declined. Mr. Bergen asked how many people are served each day by the Fire Department, Police Department, the sewer division; yet these are very necessary services. Mr. Bergen stated that some people are concerned about the relatively small amount of riders on the large buses that is not very cost effective. He said he wished there was a way to use smaller vehicles but the grants affect that. Mr. Bergen urged the Council to raise rates if they must, but do not cut service availability. He asked the Council to look closely at possibly reducing the large expenditures that are now in effect or are being proposed to save the City’s valuable and needed transit service. Mayor Nexsen stated that a new census was released and showed an increase from 52,500 to 52,900. He said what the City tries to do is provide services and spend money on things that will Lake Havasu City Page 5 City Council Work Session Minutes - Final January 14, 2014 receive a return on investment. He said the City Council is cognizant that people need this to go to work; however, having said that, just like in a family budget there are not unlimited funds. He said the City has to divide the funding the best way possible. Mayor Nexsen reiterated that this is not a one-time expenditure, it is an operating expenditure and once the money is spent it is gone. He said next year it will have to be budgeted again and again the next year just to keep the same level of service. Mayor Nexsen said he recognizes that there is a definite need for transit service but the City cannot go into deficit spending. He said he agrees with Mr. Bergen that the State needs to balance their budget on their own backs and not on cities and towns backs. He added that LTAF funds are disappearing, but also the State has swept $1.7 billion in Highway User Revenue Funds (HURF) over the past 12 to 14 years. Councilmember Alger asked if the City could increase the fare to accommodate a Saturday service. Mr. Parsons explained how increasing fare affects transit grant funding. He said if it costs the City $1 million to operate transit service for one year, and the City receives $100,000 in fare revenue, the City only qualifies for a 50/50 match on $900,000. He said in addition when you consider increasing transit fare you will find people becoming home bound because they simply cannot afford to ride. Councilmember Barlow said he was in favor of Option I. He added that he disagrees with the Mayor in that he believes there are functions where the City should not expect to make money. He said a City should provide certain services to the citizens and this is one of them, even if it costs the City $600,000. Mayor Nexsen said he was also in favor of Option I. He clarified that he never meant to imply that the City is going to make money on transit, it is understood that it is a subsidy. Councilmember Coke noted that Option I did not include holidays and asked if the City was compensating an extra day to accommodate those closed days, to which Mr. Parsons replied no those days were used as cost savings. Councilmember Brister thanked those in the audience and added that this is a very difficult decision as there are many people who need this transportation. She encouraged others to also contact State senators and representatives, like Mr. Bergen did, to voice their concerns about transit funding. Councilmember McAtlin said he was in favor of Option I as it made the most sense. Mayor Nexsen said there was a general consensus from the Council for Option I. He said he would like to extend the current service as long as the City can into September 2014 and reconsider Lake Havasu City Page 6 City Council Work Session Minutes - Final January 14, 2014 improvements or additional days if LTAF money comes back. City Manager Charlie Cassens said staff will move forward with the numbers from Option I in the upcoming budget discussions. 6. ADJOURN Upon motion by Councilmember Callahan and seconded, the meeting adjourned at 6:00 p.m. CERTIFICATION I hereby certify that the foregoing is a full and true copy of the Work Session Meeting Minutes of the Lake Havasu City Council held on the 14th day of January, 2014. I further certify that the meeting was duly called and posted, and that a quorum was present. ____________________________________ Kelly Williams, City Clerk Lake Havasu City Page 7