ESTABLISHING A POLICY ON FUNDING THE OPERATING COST OF THE CITY BUS SYSTEM.

    WHEREAS, the public transit system of the City and County of Honolulu is comprised of the bus system which provides regularly scheduled, fixed route service and the special transit service which provides paratransit services for persons with disabilities; and

    WHEREAS, the City bus system benefits the general welfare by increasing public mobility, lessening traffic congestion by diverting people from cars, reducing emissions and pollutants associated with vehicular travel, and decreasing the demand for limited on- and off-street parking; and

    WHEREAS, as an essential municipal service, the City bus system is heavily patronized as evidenced by the following statistics reported by the Department of Transportation Services: actual ridership of 73.1 million in fiscal year 1997-98 and 69.7 million in fiscal year 1998-99 and projected ridership of 70 million in fiscal year 1999-2000; and

    WHEREAS, notwithstanding the heavy public use and benefits derived from the City bus system, a large portion of the operating cost of the City bus system is subsidized by nonusers via the City's general and highway funds; and

    WHEREAS, a smaller portion is funded by the farebox revenues which have ranged from 20 to 30 percent of the operating cost of the City bus system in recent years; and

    WHEREAS, recognizing the monetary demands of the operating cost of the bus system on the City budget, the Council's 1995 Budget Summit recommended that the City Administration and the Council find a means of limiting the subsidy for the bus operations to 70%, or a similar amount, so that the subsidy does not grow unreasonably high; and

    WHEREAS, the Council finds that such a policy is necessary to guide the City administration and the Council in the proper planning and budgeting for the City bus system which includes:

    (1)    Establishing a ridership goal for each fiscal year which must be achieved in order to generate the necessary fare revenues for that year;

    (2)    Encouraging an evaluation of the impact of ridership forecasts and fare revenue projections when considering budgetary decisions affecting service levels; and

    (3)    Setting a percentage limit on the subsidy for the City bus system;

now, therefore,

    BE IT RESOLVED by the Council of the City and County of Honolulu that the funding of the annual operating cost of the City bus system, excluding special transit service and debt service, be governed by the following policy:

    (1)    Bus fares shall be adjusted as provided under this policy so that the farebox recovery ratio does not fall below 27 percent nor exceed 33 percent; and

    (2)    The portion of operating cost remaining after application of paragraph (1) and intergovernmental grants shall be funded with the City's highway funds and general funds;

and

    BE IT FURTHER RESOLVED that upon the adoption of this Resolution, all subsequent annual executive operating budgets submitted by the Mayor to the Council shall comply with this policy; and

                     INTRODUCED BY:

                     Duke Bainum

                    
                                Councilmembers

DATE OF INTRODUCTION:

February 15, 2000

Honolulu, Hawaii