Latest news with #ChristopherDurand
Yahoo
09-07-2025
- Business
- Yahoo
RIPTA to consider spending cuts, layoffs, fare hikes. Here's why
PROVIDENCE – Bus fares are set to rise throughout the Ocean State and routes scaled back − including termination of the South County Beach Bus − as the Rhode Island Public Transit Authority cuts spending to close a projected $18 million budget gap. The exact size of the fare hike and details on which routes will be axed or see frequency reduced, is expected to be announced in July. In anticipation of the announcement, RIPTA has announced a series of nine legally-required public hearings starting July 28 where riders throughout the state can share their thoughts about the changes. "RIPTA's primary source of operating funds, the state gas tax, has failed to keep pace with inflation, making it inadequate to sustain a quality transit system and contributing to the agency's budget deficit,' RIPTA CEO Christopher Durand said in a Thursday, June 26 news release. 'We've worked diligently to manage our operations with limited resources, and an independent efficiency study has confirmed what we already knew: there are no hidden savings left to be found. At this point, in order to close the budget gap, we must reluctantly consider reducing service, increasing fares and laying off our workforce. Without new revenue, we simply have no other choice.' Riders should anticipate the "elimination of routes or route segments, decreased service frequency, reduced service span, and reduced or eliminated weekend service, the news release said. "The reductions would include the elimination of South County Express Beach Bus service." A consultant's "efficiency study" of how the statewide bus system can operate without federal pandemic funding is now expected to be released in "early to mid July," according to RIPTA spokesperson Cristy Raposo Perry. Cuts became inevitable when the General Assembly passed a state budget June 20 that provided RIPTA an extra $15 million next year through an increase in the state gas tax, but still left the agency facing an $18 million hole. At a June 26 meeting of the RIPTA Board of Directors, board members braced for bad news. How critical are RIPTA's money woes? Bad enough that after discussing the budget, the Board of Directors opted to go without insurance next year to protect the agency from catastrophic medical claims by employees. Called stop-loss insurance, these policies are used by employers who self-insure workers to guard against a sudden spike of expensive, unexpected claims. In most years, including each of the last five RIPTA has had a policy, claims exceeding the $400,000 threshold where the stop-loss policy kicks in have cost the agency less than its premiums. This past year, for example, the insurance only covered $100,000 in claims. The policy for next year would have cost $480,000 in premiums and fees. So, facing layoffs and route reductions that could exacerbate ridership losses, the board decided to roll the dice and go uninsured starting in July. "Maybe this is the year to go naked on this?" board member Normand Benoit suggested. Durand said the $480,000 saved by not buying a policy should be enough to save five jobs. Of course, that's unless there's a bad accident or a few people get really sick. RIPTA began buying stop-loss insurance after getting socked with $1.1 million claim in fiscal 2017-2018. "This will be the one opportunity I can think of off the top of my head to save some significant money," Benoit said. "Yes, we take on some additional risk. We're not going to know what the end result of this decision is until a year later." The rest of the board agreed, and the insurance policy was tabled. Like most mass transit agencies across the country, RIPTA saw ridership plunge during the COVID pandemic. Some of those bus passengers returned in recent years, but not all, and federal pandemic aid has now run out. Through May, RIPTA ridership was 300,000 people short of where it was at the same period in 2024, suggesting that ridership may have plateaued despite far fewer canceled bus trips than a year ago. The reduction in canceled trips is the result of a driver recruitment effort and pay raises that cured a persistent shortage. The budget shortfall could reverse some of those gains. Sections of the consultant efficiency study that have been released project that RIPTA might need to cut as much as 20% of its service and 90 employees. To try to find new riders and revenue, Durand said RIPTA is exploring partnerships with major employers, such as a deal with Amazon to serve its Johnston distribution center. RIPTA is in talks with Ocean State Job Lot to serve its headquarters in the Quonset Business Park in North Kingstown. This article originally appeared on The Providence Journal: Cash-strapped RIPTA awaits efficiency study to plan best route ahead
Yahoo
18-06-2025
- Business
- Yahoo
RIPTA faces 90 layoffs, 20% service cut even with funding in proposed House budget
Even with $15 million in new funding proposed by lawmakers, the Rhode Island Public Transit Authority would need to cut up to 20% of bus trips and lay off 90 employees to balance its budget next year, according to a consultant hired to find efficiencies in the system. The study identified ways RIPTA could generate between $2 million to $5 million in new revenue or savings, not enough to plug the agency's estimated $18 million budget gap. "There are no efficiencies that can be found that would completely close the budget gap that we are facing and prevent service reductions," RIPTA CEO Christopher Durand wrote in a letter to House leaders on June 16. "This will mean a reduction to the fixed route workforce by approximately 90 employees to get the service inline with financial resources." Such cuts to service will likely lead to "additional losses in terms of fare revenues," long-term loss of federal funds and loss of ridership due to diminished network effects and "inability to connect between routes," the study said. The options for raising more revenue identified in the "efficiency study" include an increase to RIPTA's standard $2 fare. Although the memo sent to lawmakers doesn't say how big the fare hike consultants studied would be, it was estimated to raise between $1 million to $2 million, depending on if it were extended to all routes. The study found that RIPTA could save up to $1 million by using federal reimbursement to pay for finance and procurement positions for capital projects. It also recommended shifting resources from rural routes to "low income and reverse commute services." And it said RIPTA's advertising revenue, which is roughly middle-of-the-pack for peer transit agencies, could possibly be boosted to make another $900,000 per year. "We are continuing to work as hard as we can to complete the study and I believe we are nearing the final scenarios. I'm providing this information as a heads up as I don't want to catch anyone off guard," Durand wrote to lawmakers. "In no way should these findings diminish the investments that the House is proposing for RIPTA." The study found RIPTA's operating costs are "in line with peer average" and its administrative costs are "below" average. RIPTA, like most transit agencies across the country, saw ridership crash during the COVID pandemic. Loss of fare revenue was plugged with federal aid, but since that assistance from Washington was exhausted this year, RIPTA has been facing a $33 million deficit for the year beginning July 1. As unpleasant as laying off 90 employees sounds, RIPTA was looking at up to 300 layoffs at the start of the year. Having to trim the workforce would also be a bitter pill for RIPTA to swallow after it raised pay recently to recruit new drivers and fix a shortage that was forcing the cancellation of trips. Gov. Dan McKee provided no additional funding for RIPTA in his budget proposal. The House rewrite of his budget unveiled June 10 included $15 million in recurring revenue for RIPTA in a proposed increase in the gas tax. Along with the funding, the budget mandates that RIPTA not cut the RIde Anywhere paratransit pilot program, which cost around $500,000 in its first year. The House passed the $14.4 billion state budget on June 17. It now moves to the state Senate. Liza Burkin, organizer of the Save RIPTA campaign and Providence Streets Coalition, said the latest consultant's report showed that there is no major inefficiency at the agency that can be fixed to close the budget gap. "Failing to fund RIPTA's $18M shortfall will initiate a chain reaction of route cancellations, fare hikes and job layoffs that will in turn lead to lower ridership and increases economic hardship," Burkin said. "This will ensure we will never achieve a robust system that affordably and sustainably gets people where they want to go." This story has been updated with new information. This article originally appeared on The Providence Journal: Consultant: To balance budget, RIPTA needs to lay off staff, cut service
Yahoo
09-04-2025
- Business
- Yahoo
RIPTA's finances are one hot mess. Lawmakers have four different solutions.
Rhode Island Public Transit Authority CEO Christopher Durand, center, stands inside the Senate Committee on Finance hearing room on April 8, 2025. He had just wrapped up a presentation on his agency's financial outlook for fiscal year 2026. (Photo by Christopher Shea/Rhode Island Current) A bill by Sen. Sam Zurier offers one way to plug the $32.6 million hole in the Rhode Island Public Transit Authority's upcoming budget: increasing the bus agency's share of the gas tax. The Providence Democrat's bill — one of four proposals seeking to solve the cash-strapped bus network's funding woes — would increase RIPTA's share of the state's tax on gasoline from 26% to 30%. It's a funding strategy that's garnered support from transit advocates and the agency's leader. 'With a $32 million shortfall, that's helpful,' RIPTA CEO Christopher Durand told the Senate Committee on Finance at a hearing on Tuesday. But the chairman of RIPTA's board of directors is opposed to the idea, arguing Zurier's gas tax shift would take away from the state department he leads. 'It would result in an annual loss of approximately $7 million, significantly impacting our capital program,' Rhode Island Department of Transportation Director Peter Alviti Jr., who the state mandated to steer RIPTA's board in 2023, wrote to the committee. Alviti did not attend Tuesday's three-hour hearing. Zurier argued Alviti's stance goes against RIPTA's board-supported goal of finding a sustainable funding source — which the gas tax has become less stable as more drivers shift to more fuel-efficient and electric vehicles. RIPTA now gets about $40 million in annual gasoline tax revenues, based on its existing allocation of 9.75 cents per gallon. That revenue is projected to drop over $1 million when fiscal year 2026 starts July 1, according to projections from the Rhode Island Department of Revenue. 'This would only restore the share RIPTA had,' Zurier said. 'It's very common sense.' Three other proposals were heard by the committee: A bill by Sen. Meghan Kallman, a Providence Democrat, would add a 75-cent fee to each fare collected by rideshare companies in order to fund mass transit. A bill by Sen. Robert Britto, an East Providence Democrat, would earmark the state's existing tax on rideshare trips toward mass transit. A resolution by Sen. Mark McKenney, a Warwick Democrat, would allocate $32.6 million from the general fund to fill RIPTA's latest budget gap. All four bills were held for further study by the committee as is standard procedure for an initial vetting by a legislative panel. Realistically, Durand said RIPTA can only cut around $10 million from its deficit because most of the expenses in the agency's $154 million spending plan are funded with federal money or tied into existing operations. 'There really isn't a whole lot to trim,' Durand said. The agency projects about 300 employees losing their jobs if lawmakers don't provide any new funding. There are ways RIPTA can try to generate revenue. A presentation Durand gave the committee floated a 5% fare increase, which the agency projects would bring in $470,871 annually. But such a change could decrease ridership by 100,000 trips, according to RIPTA's presentation. Durand had promised the agency's board of directors last December that raising fares would not be on the table. Another potential source could be by courting more businesses to buy ad spots on sheltered stops, which the agency projects would bring in $440,000 annually. Committee Chairman Lou DiPalma, a Middletown Democrat, suggested RIPTA could take over non-emergency medical transportation for Medicaid enrollees, something the agency used to provide until the service was privatized some years ago. State leaders are still waiting on RIPTA to submit an independent efficiency study of its operations, as mandated in the state's fiscal 2025 budget. The study was supposed to be done March 1, but the agency's board of directors delayed the bid process last year until it could find a permanent CEO Durand, who was the interim CEO for seven months, took over the agency permanently last November. RIPTA's board finally awarded a contract to do the efficiency study on March 27 to Canadian engineering consulting firm WSP, which likely won't have a final report complete until the summer — after the General Assembly likely wraps up this year's legislative session. Durand provided lawmakers with a two-page memo from WSP detailing how transit agencies nationwide are dealing with ridership and workforce challenges following the pandemic. DiPalma called the lack of a final study at this point 'extremely disappointing.' 'We need facts and data,' he said. 'This is not going to satisfy what we need for the budget.' But DiPalma did not blame Durand for RIPTA's latest financial crisis, instead placing it on Gov. Dan McKee for leaving it unaddressed in his recommended budget and passing the buck to the General Assembly. 'That's categorically what happened — we're given the charge to figure it out, and we're going to figure it out,' DiPalma said. 'Rhode Islanders expect to have a public transit authority that serves their needs — in an efficient and effective manner.' SUBSCRIBE: GET THE MORNING HEADLINES DELIVERED TO YOUR INBOX
Yahoo
28-03-2025
- Business
- Yahoo
New RIPTA hub site eyed near train station, but project future uncertain.
The empty lawn between Providence Place mall and train station has become a leading site for a proposed Rhode Island Public Transit Authority bus hub, but the project's viability is in doubt because of the agency's fiscal woes. A consortium RIPTA hired at the start of last year to identify where a new state bus hub should go, what it should look like and how it should be paid for released its findings Thursday and named the Francis Street lot one of two targeted sites. The other is a short walk on the opposite side of the Providence Train Station on Park Row West. State officials have been working to move the state's central bus hub somewhere −possibly anywhere − other than its current home for more than a decade. And for much of that time, supporters of a new bus hub have hoped that building it inside of a larger private development will help provide a way to finance it. But RIPTA faces a projected $32 million budget deficit for the year starting July 1 and the report from the Next Wave Partners consortium acknowledges that multifamily construction is "challenging in any market" even before factoring in Trump administration tariffs and uncertainty around federal spending. The RIPTA Board of Directors discussed the Next Wave report Thursday afternoon, but did not take any vote on it. RIPTA CEO Christopher Durand said the agency still supports the new hub, but needs to sort out its money issues and do some hard thinking about the best way to proceed. "I think that there's obviously a lot of value to a new transit center especially colocated with rail, but it's got to be the right project, the right way," Durand said. "I think we've explored the idea of a transit-oriented development that could help offset the cost, maybe be at revenue source for RIPTA, help the operating budget. And I think as we worked with Next Wave, we exhausted those options and I just don't think, there's not a model that's materializing that would do what we need." Voters approved $35 million for a new bus hub in 2014 even though state officials at the time had not agreed on a location for one. Since then more than a dozen sites have been studied and several different detailed plans proposed − ranging from a mixed-use building on Dorrance Street to a tunnel under Kennedy Plaza − before being scrapped. RIPTA entered into a public-private partnership with Next Wave, which is lead by Gilbane Development and Marsella Development, that involves the consortium potentially planning, promoting, designing, financing and ultimately building the transit center. The amount of money the private group is paid depends on how far the project goes. A contract signed last year that would pay Next Wave $16.9 million if all six phases up to 60% design of a new hub were completed. Through two phases, RIPTA has paid Next Wave $2.5 million so far, spokeswoman Cristy Raposo Perry said. 'Over the past year we have solicited feedback from thousands of Rhode Islanders and completed an analysis of several possible sites for a new transit center," Durand said in an email. "While we are confident that a modern transit center can improve ridership, the downtown area and the rider experience, we are going to take our time to analyze the most viable options and the cost associated given the agency's current budget gap." Next Wave held public listening sessions on the bus hub last year that tested the popularity of different hub locations excluding Kennedy Plaza. After the sessions the group began focusing their work on land around the train station, specifically the Park Row property parcel owned by Capital Properties to the east of the station. In exploring ways to route buses into a hub there, the group was intrigued by the land to the west of the station, underneath which the northeast corridor tracks now pass. The land between the station and mall has been eyed for development before, but the complications associated with building over the tracks and dealing with the federal government have scared most plans off. The Next Wave report recommends RIPTA seeking a number of potential public funding sources to finance the bus hub including a federal Railroad Rehabilitation and Improvement Financing loan program. If the project includes apartments, Next Wave recommends making 30% of them below market rent to qualify for public affordable housing financing. Many transit advocates and riders want the state's central bus hub to remain at Kennedy Plaza. This article originally appeared on The Providence Journal: RIPTA eyes new site near Providence Place mall for bus hub
Yahoo
14-03-2025
- Business
- Yahoo
RIPTA may have to lay off 300 employees, reduce service if budget gap isn't filled
Rhode Island's statewide bus system would have to shed around 300 employees if lawmakers do not provide new funding to close a projected $32 million budget gap for next year, the Rhode Island Public Transit Authority said Thursday. The agency released its layoff estimate two days after RIPTA management told lawmakers that they had not identified any way to plug the deficit that would not involve hurting workers and riders. "If nothing else changes, and I do think there are opportunities to come up with new revenues, but I am not seeing anything right now that would solve that in full," RIPTA CEO Christopher Durand told the House Finance Committee on Tuesday night. "So I think we would have to be looking at service reductions or modifications, potentially fairly large ones." Durand didn't put any numbers on how large those reductions would be or how many layoffs would accompany them when asked Tuesday, but on Thursday RIPTA spokeswoman Cristy Raposo Perry provided this update: "Without any new revenue sources, and assuming there are no changes to our operations, we would need to reduce our workforce by nearly 300 employees. While a finalized reduction plan is not yet in place, it would involve significant service cuts statewide." RIPTA had 849 employees as of February, according to a House Fiscal Office report, so a 300-worker reduction would be more than a third of the agency's workforce. Budget woes have been building at RIPTA, and at nearly all transit agencies across the country, since ridership crashed during the COVID-19 pandemic. Federal aid plugged the gap, but it was exhausted this year. Lawmakers last summer included $15 million in leftover federal funds in RIPTA's $154 million budget to get the agency through the fiscal year that ends June 30. But now all the pandemic money − both the dollars specifically for transit and the $1.1 billion in all-purpose American Rescue Plan Act aid −has been spoken for, and the state is facing a $250 million projected budget shortfall. Gov. Dan McKee's proposed budget for next year is silent on RIPTA's budget deficit and actually includes around $1 million fewer state dollars (mostly via the gas tax) than this year. So it will again be up to the General Assembly to prevent hundreds of layoffs and service reductions, such as eliminated routes or fewer bus trips per day on the routes that remain. State lawmakers have proposed a number of bills to "Save RIPTA," with ideas that include requiring large employers to buy bus passes for workers, increasing RIPTA's proceeds from the state gas tax and directing sales taxes collected from ride-hailing apps to the bus system. As a condition of giving RIPTA an extra $15 million this year, lawmakers required the agency do an "efficiency study" to identify ways to save money going forward. The study was supposed to have been done by March 1, but RIPTA delayed it when former CEO Scott Avedisian resigned last April and was replaced by Durand. Durand said RIPTA expects bids from interested consultants to be submitted by the end of Thursday, with work beginning in early April and recommendations delivered in May or early June. Some of the ideas Durand said the state is looking at to provide more revenue to RIPTA include taking over non-emergency medical transportation for Medicaid enrollees, a service that it used to provide but that was privatized years ago. To increase ridership, Durand said RIPTA is looking to provide more bus routes directly to large employers, similar to the service it runs to Amazon's new warehouse in Johnston. Durand said 30 people per day are riding to and from Amazon. The company is paying RIPTA $90,000 for passes. He said Quonset Point in North Kingstown and the new stadium at Tidewater Landing in Pawtucket are other areas where RIPTA sees opportunities for growth. This article originally appeared on The Providence Journal: RIPTA warns of mass layoffs, major service cuts if budget gap not filled
