OPERATION COMMITTEE

OPERATION COMMITTEE

JULY 17, 2002

SUBJECT: SERVICE AGREEMENT BETWEEN THE Metro AND THE CITY OF NORWALK

ACTION: APPROVE SERVICE AGREEMENT BETWEEN THE Metro AND THE CITY OF NORWALK

RECOMMENDATION

Approve results of May 18, 2002 Public Hearing (Attachment A)

B. Authorize the Chief Executive Office to enter into a Service Agreement between the Los Angeles County Metropolitan Transportation Authority (Metro) and the City of Norwalk-Norwalk Transit System (NTS) to transfer operation of a 9.2 mile segment of Metro line 125 for six years effective September 1, 2002 through June 30, 2008 (Attachment B).

RATIONALE

The City of Norwalk requested that the Metro transfer operating responsibility for a portion of its contracted service Line 125 (east of the Norwalk Green Line (D Line) Station) to NTS. This request was made in response to the Southeast Bus Restructuring (SABRE) Study. The Service Agreement will transfer service on a 9.2-mile segment of Line 125 from First Transit, Inc. to Norwalk Transit Service (NTS) at the same revenue service hour rate as the present contracted service provider. The proposed contracted segment is that part of Line 125 from the Metro Green Line (D Line) Station in Norwalk to La Mirada.

Since the Metro’s Line 125 is a very long route (peak-period trips take two hours in a single direction), truncating the existing route at the Green Line (D Line) terminal would help in scheduling and ensuring better on-time performance of the remaining westerly segment of Line 125. During much of the day, service operates only once an hour along the eastern segment. Staff believes that a local community operator could more effectively serve this segment. The Service Agreement would transfer the operation of the 9.2-mile eastern segment of Line 125 to NTS.

First Transit would continue to operate the remaining 23.1-mile western segment of Line 125 from the Green Line (D Line) terminal to El Segundo. First Transit rate for operating an estimated 54,421 annual revenue service hours on Line 125 would be a unit rate of $ 43.92 per hour, less farebox revenue. The transfer of the 9.2-mile eastern segment of Line 125 to NTS will reduce First Transit’s revenue service hours on Line 125 by 9,468 revenue service hours in FY03. The Service Agreement between the Metro and NTS essentially transfers 9,468 revenue service hours from First Transit, at the same unit rate. The Service Agreement includes the Metro reimbursing NTS for fare passes, and the retention of fare box revenues by NTS.

The reduction in service hours is in accordance with the contract between the Metro and First Transit, Inc., which permits the Metro to reduce revenue service hours by 25% of the total contract hours without having to open the contract to renegotiations. This adjustment is well within the 25% margin that’s allowed per the contract.

Metro Board of Directors previously authorized a similar agreement with the City of Glendale in April 2000. At that time, the route of Metro contract Line 177 was restructured with each party agreeing to operate a portion of the restructured route. The City incorporated its route into the Bee Line Shuttle system; Metro continued to provide service to the Jet Propulsion Laboratory in Pasadena. Transfer connections between the two lines was established in Glendale.

On Saturday, May 18, 2002 staff conducted a public hearing to receive public testimony on a staff proposal to restructure Metro Line 125 (Rosecrans Avenue) in the Norwalk-La Mirada areas. The proposed modification would shorten the route to improve productivity and the quality of service. The public hearing was held in the Metro Board Room, and was conducted by the Deputy Executive Officer of Service Development, Rod Goldman, the appointed hearing officer for the event.

Nine individuals and organizations submitted written and oral testimony on the staff proposal through May 18^th, the close of the public record. Of the testimony received on this matter, virtually all were supportive of the change as long as specific concerns were addressed favorably.

Most respondents wanted assurances that Norwalk Transit would honor Metro fare media such as tokens and passes. Some wanted assurances that Norwalk Transit would continue to operate the same frequency, hours and days of service as Line 125 does today in the area. Another concern expressed by respondents was the need to establish convenient connections between Line 125 and new Norwalk Line 5 to minimize transfer waits at the I-605 Norwalk Green Line (D Line) Station. The current staff recommendation will satisfactorily accommodate these issues.

Attachment A summarizes public comment received on the staff proposal. Also included in the attachment is staff’s response to public comment, and an assessment of the potential impacts of the service modification. Overall, about 300 weekday patrons may need to transfer at the I-605 Station to continue their trip; however, no adverse economic impact is anticipated for these riders since their commute costs will remain the same or, in some cases, be less due to the lower Norwalk cash fare. By way of comparison, about 7,000 existing patrons stand to benefit from improved on-time performance made possible by the shorter route to be operated on Line 125. The Board should consider this information prior to approving the staff recommendation.

Based on the need to provide 9,468 revenue service hours funding, funding in the amount of $415,835 is included in the FY03 budget in cost center number 3590, Contract Services under project number 300011, Contract Bus Services and line item 50801, Purchased Transportation. This is the same rate the Metro would have paid to First Transit in FY03 with the exception of pass reimbursement provision. Thereafter, and for the following five years, the Metro would pay NTS the previous year’s unit rate plus an annual adjustment for cost of living based on the Consumer Price Index increase for the preceding 12 months. The proposed Service Agreement is shown in Attachment B.

The first alternative considered is to not transfer operation of this 9.2-mile eastern segment of Line 125 from First Transit to NTS. The Metro’s contractor, First Transit, Inc., would then continue to operate the entire Line 125 as a contract line. However, not transferring this portion of the line to NTS would not be in agreement with the Southeast Bus Restructuring (SABRE) Study.

The second alternative is to operate the local transit line using Metro staff. This alternative is not recommended. This line is a high subsidy requiring a higher ratio of funding. The unit rates of the proposed Service Agreement with NTS are much less than the higher operating rate of using Metro staff.