NC: GTA Bus Contractor's Bid Solves $2.5M Budget Gap

May 14--GREENSBORO -- Bus riders, rejoice.

The city's $2.5 million bus system budget crisis -- and the planned rate increases and service cuts -- likely has been averted for at least a year.

The Greensboro Transit Authority board is recommending that the City Council enter a new, three-year contract with Veolia Transportation Services, the company that operates the city's bus system, Libby James, the manager of the city's public transportation division, said Tuesday.

The bid came in under budget. So much so, in fact, that the transit system's projected $2.5 million budget shortfall narrowed to $700,000 -- an amount that can be paid with reserve funds.

That means riders won't face the service reductions or the 25-cent fare increase Greensboro officials proposed to balance the budget.

"We've been negotiating hard with the contractors," Adam Fischer, the city's transportation director, said Tuesday.

The new contract wouldn't eliminate the transit system's budget problems. But it would buy the city some time to consider other ways to cover costs, Fischer said.

The council will consider the Veolia contract at its meeting next week.

GTA's $22 million budget has been whacked by federal, state and local governments in recent years.

To close the budget gap, earlier this spring the GTA board recommended the most extensive service cuts in the 23-year history of the bus system.

The changes would have made riding the bus more expensive and less convenient.

The city had planned to scale back nighttime bus service and consolidate routes on weeknights and weekends, among other changes.

The GTA board also had agreed to increase the bus fare 25 cents to $1.75.

The board took most of those recommendations off the table because of the contract savings, Fischer said. He said the city will continue, as planned, to let PART take over the airport-area Career Express route, which will save GTA about $290,000 a year but won't change the service.

Veolia has operated the city's buses since 1999, James said. Veolia is responsible for the day-to-day operations and oversight for 220 employees.

The proposed contract would be worth about $45.7 million for three years. The city has the option to renew the contract for two additional years.

Fischer said the city would have to come up with ways -- other than dipping into savings -- to pay for GTA in the second and third years of the contract, when the money due Veolia would increase.

"Hopefully, revenues will pick up, and it won't be quite or nearly as daunting as the $2.5 million (budget gap)," Fischer said.

Contact Amanda Lehmert at (336) 373-7075, and follow @alehmert_NR on Twitter.

Copyright 2014 - News & Record, Greensboro, N.C.

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