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CR2002-186 Hop-A-Ride contract c,\IY Op ... ~ kOPKINS . November 27,2002 Council Report 02-186 HOP-A-RIDE CONTRACT Proposed Action Staff recommends the following motion: Move to award the 2003-4 Hop-A-Ride contract to AC Transportation, Inc., and increase the ticket price. Overview The Hop-A-Ride service is an advance-reservation, shared-ride, and door-to-door transportation service for anyone who needs transportation within the Hopkins City limits. The current system service operates Monday through Thursday from 7:00 a.m. to 5:00 p.m. and 7:00 a.m. to 4:00 p.m. on Friday. Two hours of additional service have been added per day in the peak time. There are six additional destinations outside the City limits. They are: 1. Methodist Hospital; 2. Opportunity Workshop in Opus II; 3. Shady Oak Beach; . 4. Knollwood shopping area; 5. leA food shelf; 6. Park Nicollet Medical Center. AC Transportation has had the Hop-A-Ride contract for the past four years. The service was last bid in 1999. The Metropolitan Council requires a bid every five years. AC Transportation Inc., was asked to provide a bid for the next two years. The bid for 2003 is $36.17 per hour, and the bid for 2004 is $36.86. The amount bid by AC Transportation was below the increase many other transportation systems are experiencing for 2003. The current price per hour is $35.50. Primary Issues to Consider . How is the Hop-A-Ride service funded? . What is the impact on the budget with a ticket price increase? . Is there a way to decrease the expense to the general fund? i " \. '1 'J \ (I, It'\,,-.1j \JI(t"(;i::r\ Nancy.$. Anderson Planner . '" CR02-186 Page 2 . Primary Issues to consider . How is the Hop-A-Ride service funded? The 2003 funding from the Met Council is $95,261. The City's general fund and revenue from the ticket sales provide the balance of the funding. The total 2003 budget would be $131,171; that would require a general fund contribution for 2003 of $17,953, based on the bid, current level of service and no increase in ticket price. The 2003 budget is based on 13,000 passengers. . What is the impact on the budget with a ticket price increase? The following is the budget for purchase of service and revenue: EXPENSES BASED ON THE CURRENT LEVEL TICKET PRICES 12 hours a day x 4 days = 48 hours per week 11 hours a day x 1 day= 11 hours per week 59 hours x $36.17 (bid) - $2134 per week $2134 per week x 52 = $110,970 110,970 Contract amount + $20,744 Other expenses . $131,714 Total expenses - $ 95,261 Met Council funding $ 36,453 Expenses funded from revenue and general fund $36,453 - $18,500 Revenue based on past years $17,953 General fund contribution EXPENSES BASED ON THE PROPOSED TICKET PRICES 12 hours a day x 4 days = 48 hours per week 11 hours a day x 1 day= 11 hours per week 59 hours x $36.17 (bid) = $2134 per week $2134 per week x 52 = $110,970 $110,970 Contract amount + $ 20,744 Other expenses $13 1 ,714 Total expenses - $ 95,261 Met Council funding $ 36,453 Expenses funded from revenue and general fund . $36,453 - $20,500 Revenue based on past history with .20 increase $15,953 General fund contribution . CR02-186 Page 3 . The ticket price has not been increased for three years. Staff is recommending that there be a .20 increase in the low-income ticket price. The following are the existing ticket prices: . Low income $1.80 . Regular income $5.00 . Knollwood $5.00 . Park Nicollet $5.00 The [allowing are the recommended ticket prices: . Low income $2.00 . Regular income $5.50 . Knollwood $5.50 . Park Nicollet $5.50 For every .10 increase in the low-income ticket price, $1200.00 is raised. There are very few requests for the regular income, Knollwood and Park Nicollet service. . . Is there a way to decrease the expense to the general fund? Last year we added 10 extra hours of service per week. A way to reduce the contract amount would be to eliminate the extra hours. This would reduce the total budget by $18,808. With the decrease of the hours, the following is the budget: 10 hours a day x 4 days = 40 hours per week 9 hours a day x 1 day= 9 hours per week 49 hours x $36.17 (bid) = $1772. per week $1773 per week x 52 = $92,161 $ 92,161 Contract amount + $ 20,744 Other expenses $112,905 Total expenses - $ 95.261 Met Council funding $ 17,644 Expenses funded from revenue and general fund $17 ,644 - $20.500 Revenue based on past history with .20 increase $ 0 General fund contribution . ~ CR02-186 Page 4 . Alternatives 1. Extend the contract to Alternative Choice Transportation, Inc. If the City Council considers this option, the contract will be extended to Alternative Choice Transportation, Inc. 2. Reject the bid from Alternative Choice Transportation, Inc. and direct staff to bid the service. Rejecting the extension and bidding the service probably will not result in many bids. In 1995 no bids were received after bidding the service out twice. In 1996, 1997, and 1998, only one bid was received, and in 1999 two bids were received. 3. Continue for further information. If the City Council indicates that further information is needed, the item should be continued. This item can be continued to December because the contract will expire December 31, 2002. . . -.