AAATA: Ypsilanti Township Boards Bus

Board OKs adding township as member of expanded Ann Arbor Area Transportation Authority; also, $34M budget for FY 2014 approved

Ann Arbor Area Transportation Authority board meeting (Sept. 26, 2013): The board took two significant actions at this month’s meeting. First, board members approved AAATA’s operating budget for the 2014 fiscal year, which starts Oct. 1. The board also approved a revision to its articles of incorporation, adding Ypsilanti Township as a member and expanding the board from nine to 10 members.

Ypsilanti Township is now a member of the Ann Arbor Transportation Authority, pending consideration by the Ann Arbor and Ypsilanti city councils.

Ypsilanti Township is now a member of the Ann Arbor Transportation Authority, pending consideration by the Ann Arbor and Ypsilanti city councils. (Green indicates the geographic area included by the AAATA.)

If the Ann Arbor city council does not object, this would be the second expansion of the AAATA board this year. The item is expected to be on the Ann Arbor city council’s Oct. 21 agenda.

The earlier expansion was given final approval by the AAATA board at its June 20, 2013 meeting. That’s when the city of Ypsilanti was admitted as a member of the AAATA and its board was increased from seven to nine members, one of whom is appointed by the city of Ypsilanti.

Regarding the budget, on Sept. 26 the board approved a $33.97 million expenditure budget for fiscal year 2014. The budget includes revenues that almost exactly balance those expenditures, leaving an excess of $20,500. About half of the revenue to the AAATA comes from local sources (taxes, purchase of service agreements and fares) with most of the rest funded from state and federal support. The budget will fund roughly 7 million total passenger trips for the next year, according to the AAATA.

Also at its meeting, the board approved the selection of the law firm Pear Sperling Eggan & Daniels P.C. to handle AAATA’s legal work. The firm already handles legal work for the transit authority, so the board’s approval means that Pear Sperling will continue in that capacity for the next five years.

As a result of another board action at the Sept. 26 meeting, Charles Griffith will be leading the board for another year as chair. He was first chosen as chair last year by his colleagues. The pattern of chairs serving for two years is typical for the AAATA.

It was the first board meeting Jack Bernard attended as a board member since being confirmed by the Ann Arbor city council on Aug. 19, 2013. However, three other board members did not attend the AAATA meeting: Roger Kerson, Anya Dale and Gillian Ream Gainsley.

Those who did attend received several updates on various projects, including construction on the new Blake Transit Center in downtown Ann Arbor, AAATA’s new website, and activity related to the southeast Michigan regional transit authority (RTA). The next board meeting of the nascent four-county authority – which includes the city of Detroit and the counties of Washtenaw, Wayne, Oakland, and Macomb – will be held at 2 p.m. on Oct. 2 at the downtown location of the Ann Arbor District Library.

Ypsilanti Township in AAATA: Qualified OK

The board considered a resolution adding Ypsilanti Township a member of the AAATA – contingent on approval by the Ann Arbor city council, as well as other involved parties.

Jack Bernard, just before taking his seat at the AAATA board table

Newly appointed board member Jack Bernard, just before taking his seat at the AAATA board table.

The AAATA board resolution included approval of new articles of incorporation for the transportation authority.

Adding Ypsilanti Township in the way outlined in the articles of incorporation would expand the AAATA board from nine to 10 members. The additional seat would be appointed by the supervisor of Ypsilanti Township – an elected position held currently by Brenda Stumbo – with the approval of the township board.

The item is expected to be on the Ann Arbor city council’s Oct. 21 agenda. An earlier expansion was given final approval by the AAATA board at its June 20, 2013 meeting. That’s when the city of Ypsilanti was admitted as a member of the AAATA and its board was increased from seven to nine members, one of whom is appointed by the city of Ypsilanti.

Ann Arbor’s additional board seat on the AAATA was filled when the Ann Arbor city council appointed Jack Bernard. Bernard is a lecturer in the University of Michigan law school and an attorney with UM’s office of the vice president and general counsel. He is also currently chair of the university’s council for disability concerns. The city of Ypsilanti’s seat was filled with Gillian Ream Gainsley. Ream Gainsley is communications and development director at the Ypsilanti District Library.

The “resolved” clause of the AAATA board’s Sept. 26 resolution makes the approval of the revised articles of incorporation for the AAATA contingent on approval from the city of Ann Arbor and other parties [emphasis added]:

… approves Amendment 3 of the Articles of Incorporation of the Ann Arbor Area Transportation Authority, in the form attached hereto as Exhibit A, except that, in the event that Ypsilanti Township, or the City of Ypsilanti, or the City of Ann Arbor declines to approve said Articles as described above, the AAATA Board directs staff to reconvene those parties to reconcile any differences relative to the Articles and to bring a new draft to the AAATA Board and all other parties. [.pdf of AAATA complete resolution on admission of Ypsilanti Township as a member]

The sequence of events leading to the possible admission of Ypsilanti Township as a member of the transit authority would be slightly different from that leading to the admission of the city of Ypsilanti. The initial resolution adopted by the AATA board on the admission of the city of Ypsilanti was simply an acknowledgment of the request. The first formal action on approval of the amended articles of incorporation – which included the city of Ypsilanti – was taken by the Ann Arbor city council.

A timeline overview:

  • April 19, 2013: Ypsilanti city councilmember Pete Murdock addresses the Ann Arbor Transportation Authority board during its regular meeting to alert the AATA to the probable request by the city of Ypsilanti to join the AATA as a member.
  • April 23, 2013: Ypsilanti city council passes resolution requesting admission as a member of the AATA.
  • May 16, 2013: AATA board approves resolution acknowledging city of Ypsilanti’s request to join AATA.
  • June 3, 2013: Ann Arbor city council approves change to articles of incorporation, admitting city of Ypsilanti as a member of AATA and increasing board membership from seven to nine members, with one of the additional board seats to be appointed by the city of Ypsilanti.
  • June 18, 2013: Ypsilanti city council approves amended articles of incorporation for AATA.
  • June 20, 2013: AATA board approves resolution formally admitting city of Ypsilanti as a member of the board, ratifying articles of incorporation, including a name change to the Ann Arbor Area Transportation Authority.
  • Sept. 9, 2013: Ypsilanti Township board passes resolution requesting membership in AAATA.
  • Sept. 23, 2013: Ypsilanti Township board passes resolution approving amended articles of incorporation with membership for Ypsilanti Township.
  • Sept. 26, 2013: AAATA board approves amended articles of incorporation with membership for Ypsilanti Township, contingent on concurrence from other parties.
  • Oct. 15, 2013: Planned Ypsilanti city council agenda item on amended articles with membership for Ypsilanti Township.
  • Oct. 21, 2013: Planned Ann Arbor city council agenda item on amended articles with membership for Ypsilanti Township.

Historically, other jurisdictions – the city of Ypsilanti, Ypsilanti Township, Pittsfield Township, and Superior Township – have obtained some transit services from the AAATA through purchase of service agreements (POSAs). They have used general fund money authorized by the governing boards to pay the AAATA for that service. In November 2010, however, voters in the city of Ypsilanti approved a dedicated transit millage by a roughly 3:1 margin.

So the city of Ypsilanti has used the proceeds of that 0.987 mill tax to pay toward its POSA agreement. Now that the city of Ypsilanti is a member of the AAATA, the revenue from that 0.987 mill tax isn’t recorded under the POSA line item in the AAATA’s budget, but rather under the line item for local, millage-generated revenues.

The expansion of AAATA one jurisdiction at a time comes in the context of a demised attempt in 2012 to expand the AATA to all of Washtenaw County in one step. Since then, work has continued among a smaller cluster of communities geographically closer to Ann Arbor – to expand and increase the frequency of service and to establish reliable funding for that improved service.

The AAATA could, with voter approval, levy a uniform property tax on the entire geographic area of its membership – but the transit authority has historically not done that. Rather, the cities of Ann Arbor and Ypsilanti have dedicated transit millages, which are levied by the cities and transmitted to the AAATA.

Contributions of AAATA members, with impact of successful 0.7 millage, if Ypsilanti Township is admitted as a member.

Chart by AAATA. Contributions of AAATA members, with impact of successful 0.7 millage, if Ypsilanti Township is admitted as a member. The hollow blue box indicates the amount paid by Ypsilanti Township for its purchase of service agreement (POSA), which would be supplanted (and exceeded) by the 0.7 millage if it were to be approved.

One possibility for funding improved transportation services in the Ann Arbor area is through an additional tax levied by the AAATA. The amount of the millage that would be required to pay for the increased services is estimated at around 0.7 mills. In the event that the AAATA were to win voter approval of a 0.7 mill transit tax – a request that might be put on the ballot in May 2014 – the city of Ypsilanti’s existing millage would remain in place, as would that of the city of Ann Arbor. The 0.7 mill tax would need approval among a majority of voters in the geographic area of member jurisdictions – which would include the two cities (Ann Arbor and Ypsilanti) as well as Ypsilanti Township, if it is admitted as a member.

Ann Arbor’s city transportation tax is levied at the rate of 2.053 mills, and currently generates $9,565,000 annually, according to AAATA. The 0.7 mill additional tax would generate $3,230,007 in additional revenue in the city of Ann Arbor for a total Ann Arbor local contribution of more than $12.7 million. According to AAATA, Ypsilanti’s dedicated millage generates $274,000, which is less than its POSA agreement called for last year. The 0.7 mill tax would generate around $189,785 in additional revenue in the city of Ypsilanti, for a total contribution in the city of Ypsilanti of around $464,000.

Ypsilanti Township pays $329,294 annually for its POSA agreement. If a 0.7 mill tax were approved, that would generate around $707,969 in the township. Based on the amount of expanded services that the township would receive, the township contribution would be defined as just that $707,969.

The proposed expansion of service does not depend on the nascent southeast Michigan regional transit authority (RTA) – a four-county authority for southeastern Michigan, which includes the city of Detroit and the counties of Washtenaw, Wayne, Oakland, and Macomb. The RTA was established in late 2012 in a lame duck session of the Michigan legislature. According to the AAATA’s Sept. 26 informational packet, the RTA has so far spent just $98 of the $500,000 in the budget that was initially allocated to it. The RTA could ask for voter approval of a property tax or a vehicle registration fee to generate transit funding.

Ypsilanti Township in AAATA: Public Commentary

During public commentary at the start of the Sept. 26 meeting, Vivienne Armentrout told the board she had been impressed by the board’s retreat held earlier in the year as the board and staff sorted through priorities and limitations. That has led to development of a work plan, which was the basis of the balanced budget – which she thought the board would be approving that night. She told the board how she felt a board should work: Board members are not managers, she told them, they are policymakers. But she noted that they have a fiduciary duty, saying that the buck literally stops with them – because the budget is the instrument they use to lead the authority in accordance with the policies that they set.

Because of that fiduciary duty, Armentrout continued, she felt that the board should not be entering into what she called a “speculative venture” by adding Ypsilanti Township as a member to the authority. She called it speculative because the financial arrangements had not been firmly defined. She contended that the township had expectations of considerably expanded service, which are based in turn on the passage of a new millage. Based on the minutes of the township board’s meeting, Armentrout was not convinced that the Ypsilanti Township board of trustees understands that.

Armentrout said that there were no documents that laid out the specific responsibilities on both sides or that defined the financial arrangement. She allowed that there was some mention of a memorandum of understanding, but there was no draft document that can be examined. She continued by saying that many details were missing, including the exact amounts and formulas for the amount to be paid by Ypsilanti Township and how those amounts would be adjusted in the future and for how long the township is making a commitment. The township’s commitment is supposed to end with the passage of the millage, she said. She urged the AAATA board to postpone a decision until those financial issues could be resolved and a clear picture is presented – of the possible impact of this decision on the AAATA’s financial integrity.

Kathy Griswold also addressed the board during public commentary time at the start of the meeting. She said there had been talk of a millage in the near future – an additional 0.7 mills for Ann Arbor residents. She stated that she supports transportation. She knew many students and hourly workers who rely on bus transportation. She told the board that they need to be very aware that they have made some missteps, and there is some dissatisfaction with the existing service because it doesn’t meet all of the needs of the Ann Arbor taxpayers. By proposing a millage, she said, expectations would be raised.

A number of students had approached her, Griswold said, and told her that the bus between Huron High School and Glencoe Hills is beyond capacity. She realized it was the beginning of a new school year, but cautioned that it was important not to have that kind of misstep if the AAATA wanted to ask voters for a new millage. Weekends are a real problem, she said. She knew a student who relies on the bus Monday through Friday and has to get up to catch a bus at 6:18 a.m. to get to school at 8 a.m. And on the weekend – because he worked Saturday and Sunday – he frequently has to pay for a taxi because he starts work before the bus service starts. She found it really disturbing when she sees young people who are trying to get ahead and make something of themselves having to struggle and having hurdles to overcome. She really wanted to see better services for Ann Arbor residents. If those services already exist, then better communication about them needs to happen – before any plans to expand are made, she concluded.

During her report from the planning and development committee, Sue Gott thanked members of the public for their attendance and commentary at that committee’s meetings. She said it was very helpful to receive that citizen input. Gott personally appreciated the fact that three members of the public had attended the most recent meeting of the planning and development committee, and all of them had given the committee good and thoughtful suggestions.

Ypsilanti Township in AAATA: Board Deliberations

During his report to the board, CEO Michael Ford commented on the addition of Ypsilanti Township to the AAATA. Ford reviewed some of the recent history. On Sept. 9, the Ypsilanti Township board of trustees had voted unanimously to request membership in AAATA. Since that time, attorneys for the authority, the township, the cities of Ypsilanti and Ann Arbor had met to draft mutually agreeable amendments to the articles of incorporation. The amended articles admit Ypsilanti Township as a member of the authority and give the township a seat on the board, bringing the total number of board members to 10.

On Sept. 23, Ford continued, the Ypsilanti Township board had voted unanimously to approve the amended articles of incorporation. AAATA’s performance monitoring and external relations (PMER) committee was recommending that the AAATA board also approve the articles of incorporation as amended, Ford said. He indicated that his understanding was the Ann Arbor city council would have the item on its Oct. 21 meeting agenda. The city of Ypsilanti would also be asked to approve the amended articles, Ford said, and is expected to have the item on its agenda on Oct. 15. If all parties approve the change, Ford said, it would bring more than 50% of Washtenaw County’s population into full participation in the AAATA.

As different communities transition from a purchase of service agreement-type relationship, to a member relationship, Ford said, it’s important to document the change with a formal contract. That had begun with the city of Ypsilanti, he noted. It ensures that the new member communities and the AAATA agree on what the obligations of a membership are.

Susan Baskett

AAATA board member Susan Baskett.

Reporting out from the PMER committee, Susan Baskett also noted that in the resolution approving Ypsilanti Township’s request for admission as a member, a “whereas” clause had been changed to make clear that the Ann Arbor city council has not yet acted on the matter but is expected to act.

Baskett also noted that the resolution admitting Ypsilanti Township into the AAATA included a “whereas” clause clarifying that the township’s financial commitment would be appropriate to the level of service received. Baskett indicated that she hoped those clarifications would help address some of the concerns that had been raised during the public commentary that evening. The committee was fully supportive of bringing a resolution to the board, Baskett concluded.

In comments later in the meeting, Eli Cooper acknowledged that over the last three or four meetings, the board had received a lot of public comment about the addition of Ypsilanti Township to the AAATA. As the AAATA moves forward, he said, the budget that’s under consideration for adoption and the services that have been provided historically are not related to the township as far as adding any additional financial liability to the authority. As the AAATA moves forward collectively as an urban core region, he said, there’s a mechanism in place that will allow the township to sustain the services that are contemplated. Cooper invited Ford to comment on that description.

Ford simplified Cooper’s sentiments by saying: “They’ll pay for what they get.” If the township wanted more service, they would pay for that, Ford said.

Baskett inquired whether the articles of incorporation and the other materials would be made public somewhere. Ford indicated that it would eventually all be placed on the AAATA’s website. Ford also indicated that some commonly asked questions with corresponding answers had been prepared. [.pdf of the AAATA's issue analysis]

Jack Bernard wanted to bring the topic to a level of clarity so that the public really does understand what the expansion would mean. He felt there is a genuine concern that the expansion would risk a decrease in service to the core of what has been the AAATA, or create additional costs. He felt that people are apprehensive because they see things growing and they compare it to other experiences that they’ve had when something has expanded – when there are greater expenses at greater risk. He felt it would be helpful to really get onto the table why the AAATA believes that those apprehensions can be alleviated.

Responding to Bernard, Ford pointed to the issue analysis and fact sheet as providing that assurance. Ford returned to a point he made earlier in the meeting – that Ypsilanti Township will be paying for the services that it receives.

Baskett pointed to the first page of the issue analysis that had been done by AAATA staff and read aloud the third bullet point:

AAATA’s funding base will be made more stable by Ypsilanti Township’s membership since Ypsilanti Township has pledged funding, equal to the cost of acquiring services through the Purchase of Service Agreement, to the Authority for transit purposes. This pledge is contained in the Township’s resolution requesting service and will be further documented in a memorandum of understanding. Note that the nature of Ypsilanti Township’s commitment will change in the event of any Authority millage, that is, the commitment of Ypsilanti Township’s general revenues can be reduced by the amount of revenue produced by the township’s share of an Authority millage. In other words, a 0.7 mil Authority levy, if enacted, would produce enough revenue in Ypsilanti Township to fully cover the cost of both existing and proposed new services in the township, making a contribution from their general fund unnecessary. This is illustrated in the accompanying chart, below.

Sue Gott allowed that one possibility is that a millage would be approved. But she felt it was important to also engage in some Plan B thinking – if there is no millage. The other question Gott asked related to the total activity of the AAATA – venturing that staff has a full plate. She asked Ford to comment on the administrative capacity of AAATA to continue route planning and other expansion opportunities. Ford indicated that in connection with the urban core process, AAATA staff had gone out and talked to a lot of people and received a lot of input. A lot of the heavy lifting and difficult work had been done, he felt – as far as what the actual service look like.

Going forward, Ford saw an increased need for communication – within the cities of Ypsilanti and Ann Arbor as well as Ypsilanti Township. He felt AAATA is in a good position to deal with that. Ford said he did not see expansion as a burden but as a need to communicate to the public in general: “I think that we’re there. We’ve done a lot of good work. We’ve got some refinements to do.” Details of the schedules and bus stop locations will need to be communicated, he allowed. He did not feel that the expansion would compromise planning efforts, and he felt AAATA was in a position to handle the expansion.

About Plan B – if a millage is not approved – Ford said there would really be no change from the way service is currently delivered and paid for. If Ypsilanti Township is a member, they’d be paying their fair share. If and when a millage is approved, Ford continued, then that’s a whole new discussion. For right now it’ll be business as usual, Ford said – but he allowed that they want to tighten up the relationship with more formal agreements. He did not foresee any major change in staff time or involvement. He concluded that he did not foresee any burden on the AAATA.

Charles Griffith offered some historical perspective on why the board was at the point of discussing adding Ypsilanti Township as a member. When the AAATA had begun a long-term planning efforts a few years back and was considering how it might include other jurisdictions, a fairly wide net had been cast. AAATA staff and board members had talked with all the other jurisdictions the county, he said, and a lot of interest had been generated throughout the county. An effort had been initiated to look at some version of a countywide transportation authority structure, Griffith said. When that was put to the test – that is, when local officials from those jurisdictions had to say yes or no about whether they wanted to be a member of the countywide authority – more of them said no.

So that effort at expansion had then been refined, Griffith said. The Ann Arbor city council had requested that the AAATA approach the task of starting with an “urban core” area that included the city of Ypsilanti, Ypsilanti Township, Pittsfield Township and the city of Saline. A number of meetings of those urban core communities had taken place over the last several months – to take a look at how to create a more vibrant regional transportation system. For some jurisdictions – like the city of Ypsilanti and Ypsilanti Township, which is requesting that same opportunity – it’s a way for long-term partners to have a chance to participate in governance, by being able to appoint a member to the board. In some cases, Griffith said, that relationship between the jurisdiction and the AAATA went back 30 years.

Secondly, those jurisdictions have the opportunity to participate in a millage request, as part of the request of the AAATA, Griffith said. Currently the funding comes from each jurisdiction individually. There’s a certain efficiency related to all the jurisdictions being able to request additional funding jointly, he said. The downside to it, and the reason it doesn’t work for every community, Griffith explained, is that each jurisdiction has different service needs. If a large part of the jurisdiction is rural and that area doesn’t need as much service as a more urban community, it might not work for that jurisdiction to request a millage at the same rate as another community. Because of service needs and tax base differences, it is not necessarily that easy to make a multi-jurisdictional millage request, Griffith allowed. But Ypsilanti Township has come to the conclusion that it would work for that township – at least with the plan that the AAATA has come up with so far.

Other communities, like Pittsfield Township, have said that a membership would not work for them. A millage request of that size would mean more transportation service than they’re willing to take on right now, Griffith said. So Pittsfield Township is happy to find that funding base on its own, and contract with the AAATA for service.

Griffith summarized his view on the guiding principle for admission to the authority by saying: “It shouldn’t matter to us which way a jurisdiction wants to participate in our authority, but from my perspective at least we want to provide the opportunity for them to participate at the highest level possible.” He felt the overall goal is to improve and increase the opportunities for members of the community. For Ypsilanti Township to be member of the AAATA makes sense, Griffith said. That’s because the township can continue to participate in the AAATA on a long-term basis under its existing arrangement. Or there will be a millage request, which would provide a different funding opportunity, he said.

Service needs would change over time, Griffith allowed – and that is why the AAATA has a 5-year plan as well as a 30-year plan, which anticipates further growth in transit over that time period.

Eric Mahler indicated he would support the resolution. If in the future other jurisdictions wanted to join the AAATA, he said, he thought the board would engage in the basic is-it-good-is-it-bad debate over and over again. It’s important for board members to lay out clearly to the public as well as to each other what the guiding principles are. He echoed Griffith’s sentiments – that it makes sense to allow jurisdictions to participate in the AAATA at the highest level that they would like to.

Mahler felt there is more risk in not letting jurisdictions into the authority. It sends a bad message to say, “We don’t want you in our authority.” Mahler continued: “It’s better to have a partner than a client.” Mahler believed that the status quo is not actually the status quo – saying that the status quo means you’re actually receding.

Mahler allowed that there might be discrepancies in service in the city of Ann Arbor in certain pockets here and there, and he felt those issues need to be addressed. At the same time, those pockets – where something might have been missed or could be improved – should not hold the AAATA back from expanding to those jurisdictions that want transportation services. Like any business, he said, you fix what’s wrong and you keep moving forward. He looked forward to Ypsilanti Township’s participation on the board.

Outcome: The board voted unanimously to approve the resolution adding Ypsilanti Township as a member of the AAATA.

Ypsilanti Township in AAATA: Public Commentary Coda

During public commentary at the conclusion of the meeting, Vivienne Armentrout told the board that the documents that the AAATA had cited clarifying Ypsilanti Township’s commitment were not convincing – because they were not contracts.

Vivienne Armentrout

Vivienne Armentrout.

And the issues analysis doesn’t commit anyone to anything, she said. She called it a “concept paper.” She also said that “whereas” clauses and in resolutions have no binding power. It’s the information in the resolved clause that commits a municipality to spend money, she said. Ypsilanti Township is not committed to anything, she contended. The “whereas” clauses that the AAATA had taken such care to insert have no force, she said.

The AAATA is admitting a municipality as a member that is a Michigan township – which operates under the assumptions that townships do, Armentrout cautioned. She was familiar with these assumptions from her years of service on the Washtenaw County board of commissioners – in particular with Ypsilanti Township. Washtenaw County had spent $1 million defending a lawsuit that had been brought by Ypsilanti Township, alleging that the county was overcharging the township for its share of sheriff deputy services. After about three years of litigation, she continued, the township had finally lost. Both entities had spent a lot of money over very fine print material, she said. Townships are very interested in getting their money’s worth. Ypsilanti Township expects every tax dollar that goes from them in any form to come back to them in exactly those needed services or they will not be satisfied.

Ypsilanti Township will advocate and agitate for additional services, Armentrout said. “I promise you, you’re going to have a lot of issues to deal with in the future if this takes place,” she said. She told the board that they did not have any guarantee even that Ypsilanti Township would pay the purchase of service agreement amount. She allowed that she might be overstating the case and there might be some goodwill involved, but she told the board that what they had approved was a handshake.

AAATA FY 2014 Budget

The board was asked to approve a $33.97 million expenditure budget for fiscal year 2014. The budget for FY 2014, which starts on Oct. 1, includes revenues that almost exactly balance those expenditures, leaving an excess of $20,500.

The FY 2014 budget restores a three-month operating reserve. The board previously had authorized dipping below that level after the state of Michigan’s allocation for operating support last year was less than expected. During the past year, however, the state legislature made an additional appropriation increasing the percentage of operating expenses subsidized by the state from 27.11% to 30.65%.

According to CEO Michael Ford’s monthly written report to the board, the budget will fund 200,000 fixed-route service hours, 64,000 paratransit service hours, 19,000 NightRide service hours, 9,000 AirRide service hours and over 2,000 ExpressRide service hours.

That translates into 7 million total passenger trips for the next year. The FY 2014 budget reflects about a 4.9% increase compared to last year.

AAATA FY 2014 Budget: Board Deliberations

About the fiscal year 2014 operating budget, Ford noted during his report to the board that the work plan was complete and had been adopted by the board at its previous meeting in August.

AAATA FY 2014 Revenue Budget

AAATA FY 2014 Budget: Revenue. (Chart by The Chronicle with data from AAATA)

The planning and development committee had reviewed the budget several times, he noted, and he had met with individual board members to go over the budget in more detail. The nearly $34 million budget, Ford continued, supports the projects in the work plan and will allow the AAATA to provide about 200,000 fixed-route service hours, 64,000 paratransit service hours, 19,000 NightRide service hours, 9,000 AirRide hours, and over 2,000 Express Ride service hours. That’s a total of about 294,000 service hours, which would include about 7 million passenger trips.

To support that level of service, Ford continued, the budget assumed an increase in service, staff and resources – such as motor coach operators and service crew, and maintenance, to support the new Blake Transit Center in downtown Ann Arbor. Biodiesel fuel prices are expected to increase, he said. Ford appreciated the board working with staff on the budget.

Later in the meeting, Sue Gott asked if the FY 2013 budget would be amended to reflect the additional supplemental state operating support the AAATA had received. Controller Phil Webb noted that there were only three days left in the fiscal year. But the differences between actual and budgeted could simply be explained, he said.

When the board reached the budget agenda item, Ford thanked board members for their time and consideration. The budget had been reviewed in a fair amount of detail, he said. If another presentation was desired, staff was prepared to do that, but he felt the board had already seen the topic quite a bit. He felt the staff had pretty well exhausted the information.

AATA FY 2014 Budget: Expenses

AAATA FY 2014 Budget: Expenses. (Chart by The Chronicle with data from AAATA)

Gott responded to Ford by saying that for the benefit of the public, who had not necessarily attended all the meetings and followed the discussion of the development of the budget, it would be helpful to have a few highlights. Controller Phil Webb was asked to provide the highlights.

Webb began by saying that the budget represents all of the human resources and financial resources that are needed over the next 12 months. Development of the budget, he said, begins by looking at The Ride Guide. The Ride Guide is essentially a promise to the community to provide a certain number of hours of service on the street, he said. That’s the basis of figuring out how many drivers are needed, how many mechanics are needed, how many buses are needed, and how much fuel will be used.

From that follows a certain amount of paratransit service that’s required to be provided, he said. AAATA goes beyond the minimum requirements of the Americans with Disabilities Act, he noted.

Webb pointed out that local tax dollars are not used to provide the AirRide service or the ExpressRide services.

Gott followed up with a comment indicating she was satisfied with the way Webb monitored cash flow through the year. She noted that they had heard the concern from the public that the AAATA maintain its financial strength and she indicated the board members all felt a responsibility to do that. She felt that the regular routine monitoring that was in place assured that responsibility is met.

Jack Bernard asked Webb to explain the benchmarking process that the AAATA is going through. Bernard felt it was important for the public to have a sense that the AAATA not looking at itself in a vacuum.

Webb indicated that a peer analysis is done routinely. The AAATA looks at its peers within the state of Michigan because the state of Michigan’s funding is unique, he said. So the AAATA compares itself to mid-sized systems in Lansing and Grand Rapids and Flint, as well as across the country – Madison, Wisc. and some other college towns that have a similar demographic. “We compare favorably in some avenues and dis-favorably in other areas, and we strive to improve ourselves as we go on,” Webb said. That comparative analysis would be coming back to the performance monitoring and external relations (PMER) committee in the next couple of months.

Eric Mahler asked if the AAATA had a separate capital budget. Webb explained that the AAATA does have a capital and categorical grant program – and the board’s first look at that would be at the October planning and development (PDC) committee meeting. And at the December meeting, board approval would be requested. The timeframe this year is a month earlier compared to the previous year – because the plan must also be submitted to the southeast Michigan regional transit authority (RTA), Webb explained.

Eli Cooper noted that the budget process had begun with the board’s retreat in the spring. A work program had been outlined. Cooper also described several rounds of committee meetings and discussion by the board. The information had been thoroughly vetted by the board, he said. That was the process.

As to the substance, Cooper reacted to some of the public commentary that had been given – about service to residents. Cooper felt it’s important to note in thinking about the budget and service to residents, given the resources that are available, that the AAATA is doing a fantastic job in providing a reliable world-class service within the community. The challenge is taking something that is good and making it better, he said.

Wringing out additional efficiencies and effectiveness sounds ideal, but that would be more difficult, he said. The question of moving forward and providing even more services that the community warrants – that’s a conversation that will need to be conducted with the community about the resources necessary to ramp up from a great level of service.

So as a board member, Cooper said he would be supporting the budget. He acknowledged that there are unmet needs and that there will be some conversations moving forward about how to best position the AAATA to meet the needs that the community expects, recognizing the AAATA’s financial resources.

Charles Griffith observed that there is a 4.9% increase in the budget compared to last year. So Griffith asked how the authority was able to handle that, and where the additional revenue had come from.

Webb noted that the AAATA is providing over 200,000 hours of fixed-route service, which is more than the AAATA has ever provided. That’s a 2.8% increase compared to the current year, Webb explained. A lot of the additional expenses go to support those services, he said. There are also some research and development projects the AAATA is working on, two of which are funded at an 80% level through federal planning grants, with the remaining 20% made up through a local share. Those projects are the connector analysis study and the WALLY station feasibility project.

Outcome: The board unanimously approved the fiscal year 2014 budget, which starts Oct. 1, 2013.

Selection of Pear Sperling for Legal Work

The board considered a resolution selecting Pear Sperling Eggan & Daniels P.C. to continue to represent the AAATA.

The contract runs five years starting on Oct. 1, 2013, and is based on an hourly rate. The value of the contract is expected to exceed a total of $100,000. That’s the amount triggering a requirement of board approval.

According to the staff memo on the resolution, 48 vendors downloaded the RFP (request for proposals) issued by the AAATA and 10 firms responded to it. Written proposals were evaluated and scored, and the top four proposers were offered interviews. After the interview process, “best and final” offers were requested from the top two proposers.

Out of that process, Pear Sperling Eggan & Daniels P.C. was chosen to provide legal counsel to the AAATA on general corporate, labor and employment matters.

At the Sept. 26 meeting during her report from the performance monitoring and external relations (PMER) committee, Susan Baskett said the committee was satisfied with the staff report on the request for proposals (RFP) and bidding process. The committee supported bringing back the incumbent law firm. Baskett indicated that she’d suggested to staff that they maintain an ongoing evaluation of all vendors so that if the AAATA were asked for a recommendation about any of its vendors, it would be documented.

Later in the meeting, Eric Mahler, who’s an attorney, asked how much the authority expected to spend in legal services. He wondered what the fee arrangement was – a flat fee or regular hourly-type work? AAATA staff indicated that the contract is based on an hourly rate but on an as-needed basis.

Mahler indicated that Pear Sperling was the lowest bidder, and said that generally when it comes to a law firm, you probably do get what you pay for. However, he said that Pear Sperling is an excellent law firm. Staff indicated that the fee rate is locked in for five years.

Baskett indicated that part of the PMER committee’s recommendation was based on Pear Sperling’s past performance, and it was not merely a decision to continue with that firm just because it was the lowest bidder.

Outcome: The board voted unanimously to select Pear Sperling for legal work for the next five years.

Board Governance

Two items appeared on the agenda related to board governance: selection of a board chair for the coming fiscal year; and adoption of the meeting schedule for the upcoming year.

Board Governance: Officer Elections

On the board’s agenda was the annual election of board officers. Charles Griffith was elected last year to serve as board chair. The pattern for the last few chairs is for them to serve two years in that capacity – but a term as chair is just one year.

Griffith is climate & energy program director for the Ecology Center. He has already served for seven years on the AAATA board, and his current appointment lasts another three years. He was reappointed to the board on May 2, 2011 to another five-year term after first being appointed on Sept. 19, 2006.

AAATA board chair Charles Griffith

AAATA board chair Charles Griffith.

The other two officers coming into the Sept. 26 meeting were Eli Cooper as treasurer and Anya Dale as secretary.

Griffith introduced the topic of officer elections by noting that it had been the board’s custom to rotate officer positions every couple of years. The current officers had been serving in that capacity one year or less, he noted. He’d asked Roger Kerson to head up a nomination committee. That committee had recommended that the current officers continue in that capacity. But Griffith indicated that he would entertain any nominations from the floor.

Sue Gott spoke on Kerson’s behalf, because he was absent. She’d served on the nominating committee with Kerson. Kerson had done quite a bit of due diligence talking with board members, Gott reported. Because some members of the board are new and might not be quite ready to step into an officer role, she and Kerson felt that it made sense to give the current officers, who are doing a good job, a continued opportunity. And because others had not volunteered an interest, it was appropriate that the existing officers be put forward as a slate for election, she said.

Gott thanked Anya Dale in her role as secretary, Griffith in his role as chair, and Eli Cooper in his role as treasurer. So that was the slate of officers that she and Kerson wanted formally to put before the board for its consideration. She invited any other questions about the committee deliberations.

Outcome: The board voted unanimously to elect existing officers to another term.

Board Governance: Committees

The AAATA board has two standing committees – the planning and development committee (PDC), and the performance monitoring and external relations committee (PMER). Griffith noted that new board member Jack Bernard had been assigned to the PMER committee. That results in the following committee composition:

  • planning and development committee: Sue Gott (chair), Eli Cooper, Gillian Ream Gainsley, Eric Mahler.
  • performance monitoring and external relations committee: Roger Kerson (chair), Susan Baskett, Jack Bernard, Anya Dale.

The PMER committee was mentioned during public commentary. Commenting on the new website during public commentary time at the start of the meeting, Jim Mogensen said that he’d looked for the minutes from the PMER committee and he had been told that the meetings of that committee weren’t available because the meetings of that committee are no longer public meetings.

At the start of the meeting, board chair Charles Griffith welcomed newly-appointed board member Jack Bernard, thanking him for being willing to join the team. “We are really thrilled to have you,” Griffith said. Bernard replied,” I’m glad to be here.”

AAATA CEO Michael Ford also welcomed Bernard to the board table at the start of his report to the board. He noted that Bernard had already devoted a lot of time and energy to staff meetings and had gone through an orientation recently. “We appreciate your time and effort,” Ford said.

Board Governance: Meeting Schedule

Also at the Sept. 26 meeting, the board considered its regular meeting schedule for fiscal year 2014, which runs from Oct. 1, 2013 through Sept. 30, 2014. The basic pattern of meetings is every third Thursday of the month. [.pdf of 2013 meeting schedule] Meeting start time is 6:30 p.m.

Outcome: Without debate, the board voted unanimously to adopt its regular meeting schedule.

Local Advisory Council

Rebecca Burke reported from the AAATA’s local advisory council (LAC), a group that provides input and feedback to AAATA on disability and senior issues. She asked the board to approve the recommendation from the council on appointments to its executive board – Cheryl Weber and John Kuchinski.

Burke also asked that the board re-examine the charge to the local advisory council – asking that communication be improved between the board and the LAC. She suggested that someone from the board be assigned as a liaison to make the communication smoother.

Outcome: The board voted unanimously to make the requested appointments to the LAC executive committee.

Communications, Committees, CEO, Commentary

At its Sept. 26 meeting, the board entertained various communications, including its usual reports from the performance monitoring and external relations committee, the planning and development committee, as well as from CEO Michael Ford. The board also heard commentary from the public. Here are some highlights.

Comm/Comm: Regional Transit Authority (RTA)

On the topic of the southeast Michigan regional transit Authority (RTA), Michael Ford indicated that board chair Charles Griffith and AAATA staff had met with the RTA’s CEO, John Hertel, to discuss the need for cooperation and education on any regional funding request that voters might receive. The RTA had selected members for its citizens advisory committee, Ford reported. Four members of the committee were selected from Washtenaw County: LuAnne Bullington, Prasanth Guruaja, Larry Krieg and John Waterman. AAATA staff continue to attend the meetings of the RTA, Ford said.

Ford mentioned during his report to the board that the Ann Arbor city council would be having a session on transportation issues, focused specifically on the RTA. [That's a work session scheduled for Oct. 14, 2013.]

And later during the AAATA board meeting, Griffith noted that the next meeting of the RTA board would be in Ann Arbor in the same room where the AAATA meets – the fourth floor conference room of the downtown library at 343 S. Fifth Ave. That meeting will be taking place on Wednesday, Oct. 2 at 2 p.m.

Comm/Comm: On-board Rider Survey

During her report from the performance monitoring and external relations committee, Susan Baskett described an upcoming survey to be done by CJI Research Corp. in late October. The same company has conducted the last two onboard surveys – in 2009 and 2011. The firm also has a strong transit background, Baskett said. The sample size of 2,500 respondents would result in a 95% confidence level on the results, she said.

Survey questions would cover issues like rider origin and destination, satisfaction with the new website, and English proficiency of riders. English proficiency of riders is related to a new requirement of Title VI, she said. Surveys will be printed in Spanish and Chinese.

Baskett reported that Bernard had suggested including questions about riders with disabilities. The survey would take place in late October over the course of about a week. Surveys would be handed out on the busy routes. Baskett hoped that the results of the survey would be back for preliminary consideration by the committee in mid-December.

Comm/Comm: Blake Transit Center

Sue Gott reported that the planning and development committee had received an update from Dawn Gabay on the artwork that will be integrated into the new Blake Transit Center under construction in downtown Ann Arbor. The RFP for the artwork had been re-issued.

The project is about a month behind schedule but within budget, according to Michael Ford’s report to the board.

Eli Cooper congratulated the project team on continuing to make progress on the construction. He recalled at the beginning of the year the board had been told about frost laws, and the target completion date has slipped. That could have created a cascade leading to more and more delay, he said. But to the staff’s credit, the delay had been stemmed at that point. “Job well done, keep it up,” Cooper concluded.

Comm/Comm: Environmental Law Conference

Charles Griffith told his board colleagues that he had just arrived from the University of Michigan law school having attended an event where the newly appointed director of the U.S. Environmental Protection Agency had delivered some remarks. [Gina McCarthy, the EPA's administrator, was appointed this summer.] She had been kicking off a conference, he reported, that the UM law school is hosting – on environmental law and public health. The following day a number of different sessions would be offered, he continued, noting that they were all free. He highlighted one of the sessions in particular – on sustainable communities. He noted that the sustainable communities session would feature at least one local speaker, Jonathan Levine, who was involved in transportation planning in the region.

Comm/Comm: Ecology Center Fundraiser

During communications, Charles Griffith announced what he called a “shameless plug” for the Ecology Center, which employs him. The center was hosting its annual fundraiser dinner on Oct. 3, and the keynote address for that event would be delivered by one of the most world-renowned climate scientists. He ventured that it would be a very interesting talk. Tickets were still available, he said.

During public commentary after Griffith’s remarks, Vivienne Armentrout filled in the name of the world-renowned climate scientist, which Griffith had not included – James Hansen.

Comm/Comm: Minutes, Ypsilanti Routes

During public commentary at the start of the meeting, Jim Mogensen addressed the board about the way his comments during public commentary at the board’s previous meeting had been portrayed in the official minutes – which the board would be asked to approve at that night’s meeting. He allowed that when you’re trying to say things within the confines of a two-minute time period, you have to appeal to allusions and other devices and sometimes things could get lost in the translation.

He had commented on the financial arrangements between the University of Michigan and the AAATA with respect to service to the east Ann Arbor medical center. He read aloud from the proposed minutes: “Mr. Mogensen commented on the perception of a lost opportunity not having service to the east Ann Arbor medical center related to express ride.” What he thought he had conveyed, Mogensen said, was a lost opportunity to have more money from the University of Michigan relating to the east Ann Arbor medical center service, not that the service had not happened.

And at the end of the previous meeting, Mogensen continued, when he had talked about changes to the service schedule that were made in August, there had been proposed changes to the Route #6B and Route #11. The unclear communication by the AAATA had not been about how the process was handled, he said. The problem had arisen when the decision was made not to make the changes to the Route 11 service. What happened at Chidester Place, where he lives, is that residents did not realize that those changes had not actually been implemented. So there was confusion about that, he said. As a follow-up, he said, there had been a problem with the printed schedule.

Summing up the current situation, Mogensen said, “It’s all alright, we’ve got it figured out.” He’d worked with AAATA staff to distribute copies of the correct schedule for the residents’ newsletter at Chidester Place. So everybody knows that the bus will not come at eight minutes after the hour but rather at 15 minutes after the hour. That matters for people who are trying to make connections, he concluded.

Susan Baskett inquired how Mogensen’s comments about the minutes would be handled. Board chair Charles Griffith suggested that the minutes be altered to conform with Mogensen’s description of what he’d said his remarks were intended to convey. The board approved the amended minutes.

Comm/Comm: Briarwood Mall Bus Stop

During his report to the board, CEO Michael Ford said the new bus stop at Briarwood Mall is complete and is operational. He described operations there as going “quite well.” Responding to some of the concerns that had been raised about the width of the boarding area – concerns raised during public commentary at the August board meeting – Ford reported that it was 10 feet wide. The Americans with Disabilities Act minimum width requirement is 8 feet, he said. Briarwood Mall had originally proposed 5 feet, but by working with the mall, that had been expanded to 10 feet. He described the development of the new bus stop as a cooperative effort between Briarwood Mall and AAATA. The mall had done the construction of the bus stop, and the AAATA had provided the shelter.

Later during question time, Jack Bernard reported that he’d watched the previous meeting of the board, and that’s why he felt he could vote on approval of the minutes. The remarks made during that meeting by Carolyn Grawi, director of advocacy and education for the Center for Independent Living, had caught his attention. She had talked about the new bus stop out at Briarwood Mall. Bernard told Ford that he thought Ford had addressed Grawi’s concerns quite nicely – except for the part related to things like garbage cans and newspaper distribution boxes. Grawi expressed apprehension about such items cluttering the space. Bernard allowed that it was not a space that the AAATA would be able to control all the time. So he hoped that dialogue can be maintained between the AAATA and Briarwood Mall to make sure that the space is actually effective. Ford indicated that the AAATA has a good relationship with Briarwood Mall and could follow up.

Comm/Comm: Fair Fares

During public commentary time at the end of the meeting, Jim Mogensen addressed the board on the topic of the financial arrangement between the University of Michigan and the AAATA for the M-Ride program. It results in $1 of revenue to the AAATA per ride. That had reminded him, he said, of the health care debate. You hear during the debate on health care that the problem is people go to the emergency room and the rest of us have to pay for them, he said. But if you’ve ever been a low-income, uninsured person, he said, you know that’s not what happens.

If you go to the emergency room and you are a low-income person and you don’t qualify for Medicare Medicaid then you get a bill – you get a very big bill, he said. And you get a payment plan. But it’s not free. There have been some proposals to limit the amount that people who are uninsured would have to pay, but the operators of health care systems say: You can’t do that – we’ll never be able to make our budget work if you cap it at what Medicaid pays!

The question came up when bus fares were raised: Did the University Michigan have to pay the additional fare? And the comment that was made was that the AAATA couldn’t do that, Mogensen said, because it would make it difficult for the University of Michigan to budget. He quipped that low-income people have no difficulty budgeting. He related his experience getting on the bus one day when a University of Michigan student said to him: I don’t have to pay anything to ride – what do you have to pay? Mogensen said that he did not give the student a lecture. But he had to admit, he said, “It was a moment!”

Present: Charles Griffith, Eric Mahler, Susan Baskett, Eli Cooper, Sue Gott, Jack Bernard.

Absent: Roger Kerson, Anya Dale, Gillian Ream Gainsley.

Next regular meeting: Thursday, Oct. 17, 2013 at 6:30 p.m. at the Ann Arbor District Library, 343 S. Fifth Ave., Ann Arbor [Check Chronicle event listings to confirm date.]

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  1. September 30, 2013 at 2:57 pm | permalink

    Regarding my comments about the Ypsilanti Township lawsuit against Washtenaw County, here is a link to the Chronicle’s coverage of the settlement. [link]

    “The bulk of the recommended payment – $732,927 – will come from Ypsilanti Township”

    “County representatives previously indicated they were seeking around $2 million. The county is not seeking payment for its legal expenses related to the lawsuit, which are estimated to be just over $1 million.”

    So the County lost both in expected revenue and in legal costs. Also, the time and effort expended by county officials, including commissioners, was not inconsiderable.

    As indicated by the Chronicle’s coverage, the lawsuit was initiated in 2006 and settled in 2011 after a number of appeals.

  2. October 4, 2013 at 5:58 pm | permalink

    In my comments, I remarked upon the uncertainty posed by the impending Federal shutdown.

    Now that this is a reality, I suggest that all parties should move even more cautiously in allocating resources to expansion. According to information published by the Department of Transportation, essentially the entire Federal Transit Administration has been furloughed (501 of 529 employees).

    As I read it, this will severely impact AAATA’s activities and funding stream. Though some of the Federal support for local transit comes from the gas tax and is therefore not affected, the employees who administer it are not on the job. A couple of quotes:

    “FTA customarily reimburses transit agencies for ongoing operations and construction projects to enable them to provide transit services and pay employees and contractors. October is typically a month where grantees request substantial reimbursements. In October of FY 2013 payments averaged about $200 million per week.”

    “FTA has sufficient liquidating cash. However, FTA would not outlay funds because appropriations would not be available to pay the salaries of staff executing payments.”