NORFOLK, Va. (WAVY) – Hampton Roads Transit (HRT) outlined a plan Thursday to try to improve revenue, as it continues to deal with being more than $5 million over budget at the end of the fiscal year.
The burden to make up that $5.3 million budget deficit falls to the cities HRT serves. Norfolk alone will need to pay $2 million — a burden some city leaders felt blindsided by. HRT acknowledged Thursday that it could do better.
“We are going to revise our monthly reporting. We’re also going to distribute that information much wider than before, sending it to other city leaders, like financial officers and city managers,” HRT CEO William Harrell told 10 On Your Side.
At a work session Thursday, attended by more city leaders than normal, HRT explained how its “true up” costs were poorly projected for fiscal year 2016. One side noted that, “FY 2016 budget forecasts were off target, resulting in significant true up balances.” They mentioned that both of the next two fiscal years are also trending “unfavorably.” HRT acknowledged in the presentation that there’s a need to “mitigate risks.”
True up costs are essentially costs that are left over after farebox revenue, state and federal funding are tapped out.
HRT leaders then explained the cause of the costs: Maintenance of an aging fleet, facility maintenance, overtime costs and a decrease in ridership.
“We’re looking at cutting some overtime costs. We’re looking at all of our general expenses. We’re going to do what we can to tighten our belts to help the cities,” Harrell said.
While HRT leaders did not offer any specific solutions to mitigate true up costs in the future, ideas floated included the possibility of phased true up payments from cities and retooling routes through a transit development plan, vowing a route analysis to see if any should be changed and set up a management and financial advisory committee.
Board members like Chesapeake Vice Mayor Rick West cautioned that those ideas are only a good start. He says a regional mindset must be adopted.
“Public transportation is a function of the region, yet it’s funded by the willingness to participate according to each city.”
West says unless HRT comes up with a direct revenue source, like a cut to transportation, gas, or sales tax, the problems will persist.
“I guess it’s the willingness for leaders to convince the constituents that this is a service we need to pay for. It’s all about being able to pay for.”
When 10 On Your Side Andy Fox spoke with HRT President and CEO William Harrell earlier this month he said he is doing what he can to ease the financial burden by eliminating positions and cutting hiring and spending where he can.
“I understand the frustration of politicians. The bottom line is we need to review the facts and work together,” said Harrell.
If you’d like to give HRT rider feedback, there’s an online survey and a series of public meetings throughout March. Click here for more information.