Executive Summary CAO Task Force Review/Recommendations FY 19 VRE Preliminary Budget as of 12-1-2017
December 7, 2017 CAO Task Force Recommendations
Supports a 3% increase ($517,508) in total jurisdictional subsidy as programmed in the six year plan. This increase pales in comparison to an estimated $8.75 million loss in state CIP capital and another $3 estimated million loss in state support for railroad access fees and debt service assistance in FY 20 due to the expiration of State Capital Project Revenue bond funding. Supports the $1 increase in VRE Amtrak Step up ticket from $7 to $8 per trip to offset an Amtrak contractual cost increase from $12 to $13 per trip in FY 19 Supports the additional 1 FTE Grants Accountant in Finance. VRE’s adopted CIP has grown from $11.2 million in FY 14 to $60 million in FY 19. The additional administrative burden of tracking multiple grant awards from an increasing number of sources and the increased complexity of grant reimbursement requests justifies the need for additional staff.
Date: 12/8/2017 1 VRE FY 19 Proposed Budget
Total Enterprise Budget (Operating/Non-Operating/Capital) $149,465,194 an increase of $16,061,372 or 12% over the FY 18 adopted amount of $133,403,822 FY 19 Operating Expenses (excludes non-operating costs such as debt service, operating reserve and capital items) totals $81,761,809 an increase of $3,531,448 or 4.5% over the FY 18 adopted amount of $78,230,361 FY 19 Non-Operating Expenses totals $6,760,870 an increase of $10,000 or 0.15% over the FY 18 adopted amount of $6,750,870 FY 19 Capital budget totals $60,942,515 an increase of $12,519,924 or 25.9% over the FY 18 adopted amount of $48,422,591 Includes $18.6 million in CMAQ/REF/SmartScale funded projects
Date: 12/8/2017 2 VRE Expenditure Budget
Operating/Non-Operating Expenses: FY2018 Operating FY2019 Operating Change % Chg Non-Departmental Operating 5,395,008 5,592,236 197,228 4% Executive Management 1,452,300 1,595,500 143,200 10% Chief of Staff 1,175,500 707,500 (468,000) -40% Marketing - 456,500 456,500 #DIV/0! Finance and Human Resources 3,672,500 4,148,500 476,000 13% Purchasing and Contract Administration 515,920 541,920 26,000 5% Project Development 1,069,250 1,206,900 137,650 13% Project Implementation 945,200 1,238,200 293,000 31% Rail Operations 1,886,000 2,102,000 216,000 11% Information Technology 2,316,333 2,175,803 (140,530) -6% Facilities Maintenance 4,590,950 4,453,750 (137,200) -3% Mechanical Operations 10,723,400 10,630,000 (93,400) -1% System Safety & Security 1,256,500 1,489,500 233,000 19% PRTC 104,000 104,000 - 0% NVTC 90,000 90,000 - 0% Train Operations 15,416,000 15,718,000 302,000 2% Maintenance of Equipment 6,360,500 7,020,500 660,000 10% Amtrak 4,407,000 4,621,000 214,000 5% Amtrak Access Fees 6,600,000 6,690,000 90,000 1% Norfolk Southern Access Fees 2,940,000 3,150,000 210,000 7% CSX Access Fees 7,300,000 8,030,000 730,000 10% - Total Operating/Non-Operating Expenses 78,216,361 81,761,809 3,545,448 4.53%
Date: 12/8/2017 3 FY 19 Budget - Expenditures
Major expenditure increases over the FY 18 adopted operating budget include: CSX – includes $200K in PTC costs & $150K station leases $730K Maintenance of Equipment – Keolis - longer trains & staff for L’Enfant mid-day storage $582K Consulting – includes $240K project mgmt. & design standard manuals - $100K mobile ticketing - $100K Transit Dev Plan $484K Salaries & Benefits-includes 1 additional FTE $474K 3% placeholder Merit/COLA in FY 19 - $218K Sales Commissions & Credit Card Processing $275K Norfolk Southern - ($150K PTC cost increase) $200K Passenger Charges – Amtrak Step-up from $12 to $13 $154K Station Parking Fees $130K
Date: 12/8/2017 4 FY 19 Budget - Expenditures
Reductions in Expenditures from FY 18 Adopted Diesel Fuel ($510K) Computer Equipment ($145K) Repairs & Maintenance ($84K)
Use of FY 17 Surplus for FY 19 Operating - $990K – One time costs Station painting – Brooke, Leeland, Rippon $300K Positive Train Control Start up costs $300K Project Manual & Design Standard Manual creation $240K LOU facility furniture $150K
Date: 12/8/2017 5 FY 19 FTE Increase
FY14 - FY19 FTE Count Change Dpt # Department FY14 FY15 FY16 FY17 FY18 FY19 FY18/19
21 Executive Management 2 2 3 3 3 3 0 22 Passenger Support Services 6 4 0 0 0 0 0 23 Chief of Staff/Govt Relations 1 2 2 2 3 2 -1 24 Marketing 1 1 1 1 0 1 1 25 Project Development 1 2 3 3 3 3 0 26 Rail Operations 5 4 8 8 8 8 0 31 Finance, Accounting & Human Resources 6 7 8 9 9 10 1 36 Information Technology 2 2 3 3 3 3 0 41 Project Implementation 4 4 3 5 5 5 0 45 Facilities Maintenance 1 1 1 2 2 2 0 46 Purchasing & Contract Administration 3 3 4 4 4 4 0 51 Mechanical Operations 4 6 7 7 7 7 0 56 System Safety and Security 1 1 2 2 2 2 0 Total 37 39 45 49 49 50 1 1 FTE Accountant/Grants – Total Cost $84,500 – Federal/State/Regional grant revenue has increased considerably over the past 10 years along with the number and complexity of grant reimbursement requests. Grantors have implemented additional reporting requirements, conduct more frequent reviews and limited timeframes for grants resulting in more frequent requests for extensions.
Date: 12/8/2017 6 Increase in Amtrak Step-Up Charge
Amtrak step-up ticket for each rider increases from $7 to $8 per trip in FY 19 VRE’s contractual costs for each rider on an Amtrak train increases from $12 to $13 per trip in FY 19 FY 16 FY 17 FY 18 FY 19 Actual Actual Adopted Proposed Cost per trip $10 $10 $12 $13 Rev per trip $5 $5 $7 $8 Revenue $469,655 $582,470 $478,800 $600,000 Expense $939,310 $1,164,940 $821,000 $975,000 Subsidy ($469,655) ($582,470) ($342,200) ($375,000)
Date: 12/8/2017 7 Ridership Year to Date
Total ridership July through November 2017 compared to same period last year: Cumulative Cumulative Cumulative Manassas Manassas Change % Change Fredericksburg Fredericksburg Change % Change System System % Change FY 17 FY 18 FY 17 FY 18 FY 17 FY 18 Change July 171,010 165,685 (5,325) -3.1% 215,517 207,246 (8,271) -3.8% 386,527 372,931 (13,596) -3.5% same service days Aug 195,790 195,363 (427) -1.6% 231,154 240,477 9,323 0.2% 426,944 435,840 8,896 -0.6% same service days Sept 193,677 177,840 (15,837) -3.9% 209,823 211,096 1,273 0.4% 403,500 388,936 (14,564) -1.6% 1 fewer service day Oct 179,857 186,603 6,746 -2.0% 207,678 227,903 20,225 2.6% 387,535 414,506 26,971 0.5% 1 additional service day Nov 169,084 167,350 (1,734) -1.8% 203,922 210,698 6,776 2.7% 373,006 378,048 5,042 0.6% 1 more service day
Total 909,418 892,841 (16,577) -1.8% 1,068,094 1,097,420 29,326 2.7% 1,977,512 1,990,261 12,749 0.6%
Date: 12/8/2017 8 Ridership
FY 19 preliminary estimate is 19,000 ADR or 4.75 million trips FY 19 estimate is up from FY 18 adopted of 18,200 or 4.55 million trips but not unrealistic in light of ridership gains achieved during FY17
Date: 12/8/2017 9 State Capital Assistance
In FY 2007 CTB authorized to issue Capital Project Revenue Bonds for transportation projects $3 Billion in total bond authority A minimum of 20% dedicated to capital transit ($60 million annually) Transit elected to receive funding over a ten year period Funding available through FY 19 General Assembly added $40M per year for transit in 2015 (HB1887) Revenue Advisory Board (RAB) created by HB 1359 to develop a proposal for new revenues to replace expiring CPR bonds and to develop a project based prioritization strategy for transit capital projects Final recommendations submitted to General Assembly on August 28, 2017 Discussion expected in 2018 and 2019 session of the General Assembly
Date: 12/8/2017 10 DRPT Projected Matching Ratios
Date: 12/8/2017 11 Railroad Access Fees
Track leases are the largest expense in the VRE expenditure budget ($17.9 Million) VRE’s only multi-year agreement that extends beyond FY 19 is Amtrak DRPT uses Flexible STP funds for Transit (which the state controls) for the federal share of VRE track lease funding – Could change if CPR bond revenue not replaced FY 18 FY 19 FY 20 FY 21 FY 22 FY 23 FY 24 Adopted Projected Projected Projected Projected Projected Projected # Trains 32 32 32 32 32 32 32 Cost $16,840,000 $17,870,000 $18,584,800 $19,197,152 $20,101,320 $20,905,372 $21,741,587
Federal Funds $8,420,000 $8,935,000 $9,292,400 $9,598,576 $10,050,660 $10,452,686 $10,870,794 State Funds $5,725,600 $6,075,800 $4,088,656 $3,071,544 $2,010,132 $836,215 $0 Local Funds $2,694,400 $2,859,200 $5,203,744 $6,527,032 $8,040,528 $9,616,471 $10,870,794 Federal % 50% 50% 50% 50% 50% 50% 50% State % 34% 34% 22% 16% 10% 4% 0% Local % 16% 16% 28% 34% 40% 46% 50%
Date: 12/8/2017 12 Adopted CIP – FY2009 – FY2019
VRE’s CIP expanded dramatically after FY2014 due to additional federal funding VRE also received favorable treatment under TSDAC where state match is determined based on the total project cost instead of the non-federal share
Date: 12/8/2017 13 FY 19 CIP
Source of Funding Program Area Project Name Amount (Millions) Train Maintenance & Storage Facilities New York Avenue Midday Storage Facility $21.8 Fed Formula Broad Run Expansion $4.4 CMAQ Life-Cycle Overhaul and Upgrade Facility $3.0 Fed Formula Train Maintenance & Storage Facilities Total $29.1 Passenger Station Facilities Quantico Station Improvements $2.0 SmartScale Brooke Station Improvements $2.5 REF Leeland Road Station Improvements $2.5 REF Alexandria Pedestrian Tunnel $5.3 SmartScale Washing Union Station Improvements $5.0 Fed Formula Passenger Station Facilities Total $17.2 Asset Management/State of Good Repair Equipment Asset Management Program $3.4 Fed Formula Facilities Asset management Program $2.5 Fed Formula Enhacement Grant - Security $0.1 Fed Formula Asset Management/State of Good Repair Total $6.0 Rolling Stock Equipment Fleet Expansion Coaches (Fredericksburg line) $2.0 SmartScale Rolling Stock Equipment Total $2.0 Information Technology ERP Implementation $2.6 Capital Reserve TRIP System/VMS Upgrade $1.0 Capital Reserve Information Technology Total $3.6 Capital Reserve Capital Reserve Contribution $3.0 Local Subsidy Capital Reserve Total $3.0 Grand Total $61.0
Date: 12/8/2017 14 FY 19 CIP
A total of $1.4 million in local monies (4.0%) leverages $35.8 million in federal and state funding: Equipment Storage Project - $21.8M Washington Union Station Improvements - $5.0M Equipment Asset Management Program - $3.4 M Life-Cycle Overhaul and Upgrade Facility - $3.0M Facilities Asset Management Program - $2.5M Security Enhancements - $105K $18.6 million in CIP projects require no local match Alexandria Pedestrian Tunnel - $5.3M -SmartScale Broad Run Expansion - $4.4M - CMAQ Brooke and Leeland Platforms - $4.9M - REF Fleet Expansion Coaches & Quantico Station Improvements - $4.0M - SmartScale
Date: 12/8/2017 15 FY 19 CIP - Revenues
Sources of Funds for FY19-24 CIP FY19 Budget FY20 Budget FY21 Budget FY22 Budget FY23 Budget FY24 Budget Federal Funding 23,265,966 23,265,966 23,265,966 23,265,966 23,265,966 23,265,966 State Capital Match for Federal Formula Funds 11,080,923 2,326,597 2,326,597 2,326,597 2,326,597 2,326,597 Federal CMAQ 3,507,604 1,983,942 2,792,030 2,101,430 1,639,781 0 State Capital Match CMAQ 876,901 495,986 698,008 525,358 409,945 0 State REF/SmartScale 14,230,000 5,199,500 0 33,919,225 32,433,396 0 Local Match 1,431,120 3,489,895 3,489,895 3,489,895 3,489,895 3,489,895 Other Funding (Includes $3 M Local Capital Contribution) 6,550,000 3,200,000 3,000,000 3,000,000 3,000,000 3,000,000 Grand Total 60,942,515 39,961,886 35,572,496 68,628,471 66,565,580 32,082,458
State Capital Match on federal formula funds declines 79% or $8.75 million between FY 19 – FY 20
Date: 12/8/2017 16 FY 18 CIP – Capital Reserve
Capital Reserve – Uncommitted Balance End of FY 13 - $3.4 million End of FY 14 - $8.6 million End of FY 15 - $15.5 million End of FY 16 - $21.993 million End of FY 17 - $27.2 million End of FY 18 - $39.2 million Includes $11 million contribution from FY2017 surplus $3 million capital contribution $1.6 million combined commitment to EMV Compliance; Broad Run Expansion and Crystal City Station Improvements End of FY 19 – $38.6 million includes $3 million capital contribution and $3.6 million combined commitment to ERP Implementation and TRIP/VMS Upgrade Most of the capital reserve contributions from FY 08 through FY 17 have come from surplus funds
Date: 12/8/2017 17 Total Jurisdictional Subsidy History
Date: 12/8/2017 18 Jurisdictional Subsidy
MetroRail SafeTrack work was on-going when the annual ridership survey was performed in October of 2016 causing Fairfax County’s share of ridership and subsidy to greatly increase in FY 18 as commuters sought alternatives to reductions in MetroRail service. Metro SafeTrack work was concluded during the summer of 2017. Ridership patterns in the October 2017 ridership survey have by and large returned to their historical norms for FY 19
Date: 12/8/2017 19 Jurisdictional Subsidy
Date: 12/8/2017 20 Jurisdictional Subsidy - 3 Years
Actual Actual Proposed FY 2019 FY 2017 FY2018 Budget Based Subsidy Subsidy on 10/4/17 Survey
Alexandria 140,589 $140,589 $144,807 Arlington 205,692 $205,692 $211,863 Fairfax County 5,160,910 $6,099,301 $5,385,794 Fredericksburg 483,524 $417,278 $436,568 Manassas 749,371 $684,586 $785,898 Manassas Park 511,777 $474,718 $511,311 Prince William County 5,968,406 $5,363,372 $6,183,745 Stafford County 2,647,222 $2,344,514 $2,475,127 Spotsylvania 1,382,749 $1,520,191 $1,632,635 Total $17,250,240 $17,250,240 $17,767,748
Date: 12/8/2017 21 Jurisdictional Subsidy w 3% Increase
Proposed FY 2019 Actual Budget Based FY2018 Net Change Net Change on 10/4/17 Survey Subsidy $ %
Alexandria $144,807 $140,589 $4,218 3.0% Arlington $211,863 $205,692 $6,171 3.0% Fairfax County $5,385,794 $6,099,300 ($713,506) -11.7% Fredericksburg $436,568 $417,278 $19,290 4.6% Manassas $785,898 $684,586 $101,312 14.8% Manassas Park $511,311 $474,718 $36,593 7.7% Prince William County $6,183,745 $5,363,372 $820,373 15.3% Stafford County $2,475,127 $2,344,514 $130,613 5.6% Spotsylvania $1,632,635 $1,520,191 $112,444 7.4% Total $17,767,748 $17,250,240 $517,508 3.0%
Date: 12/8/2017 22 Jurisdictional Subsidy w/o 3% increase
Proposed FY 2019 Actual Budget Based FY2018 Net Change Net Change on 10/4/17 Survey Subsidy $ %
Alexandria $144,807 $140,589 $4,218 3.0% Arlington $211,863 $205,692 $6,171 3.0% Fairfax County $5,261,467 $6,099,300 ($837,833) -13.7% Fredericksburg $415,539 $417,278 ($1,739) -0.4% Manassas $761,536 $684,586 $76,950 11.2% Manassas Park $495,858 $474,718 $21,140 4.5% Prince William County $6,008,216 $5,363,372 $644,844 12.0% Stafford County $2,386,221 $2,344,514 $41,707 1.8% Spotsylvania $1,564,733 $1,520,191 $44,542 2.9% Total $17,250,240 $17,250,240 $0 0.0%
Date: 12/8/2017 23 Jurisdictional Subsidy
Proposed FY 2019 Proposed FY 2019 Budget Based Budget Based on 10/4/17 Survey on 10/4/17 Survey 3% Increase No Increase Difference % Difference Alexandria $144,807 $144,807 $0 -- Arlington $211,863 $211,863 $0 -- Fairfax County $5,385,794 $5,261,467 $124,327 2.4% Fredericksburg $436,568 $415,539 $21,029 5.1% Manassas $785,898 $761,536 $24,362 3.2% Manassas Park $511,311 $495,858 $15,453 3.1% Prince William County $6,183,745 $6,008,216 $175,529 2.9% Stafford County $2,475,127 $2,386,221 $88,906 3.7% Spotsylvania $1,632,635 $1,564,733 $67,902 4.3% Total $17,767,748 $17,250,240 $517,508 3.0%
Date: 12/8/2017 24