Latest news with #RIPTA
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
Boston Globe
23-06-2025
- Business
- Boston Globe
Why I'm leaving Rhode Island
Get Rhode Map A weekday briefing from veteran Rhode Island reporters, focused on the things that matter most in the Ocean State. Enter Email Sign Up These highly sought after professionals can live anywhere they please. Why would they bother moving to a place like Rhode Island, where the only transit option is a bus that comes twice an hour during the day, and doesn't run at all when you want to attend a networking event, fundraiser, or just a fun night out with friends? Related : Advertisement While local politicians focus on tax incentives, many top companies are more focused on access to a highly specialized workforce. And those workers are attracted to places where they can afford good homes and get around easily. If Advertisement If Providence's Innovation District is to be the next Kendall Square, we need to put the $45 million a year in corporate tax subsidies — which we're not even breaking even on — to better use saving and growing RIPTA. Without investing it in mass transit, I can tell you right now, the companies will never come. Rhode Island never had a chance at That's why despite my roots in this state, like many before me, I'm leaving for greener pastures in Philadelphia, where I bought a home for a fraction of the price that it would cost here in Rhode Island, while comfortably ditching my car. Pennsylvania Governor John Shapiro is Advertisement When advocating for transit, an often forgotten part of the picture is housing. While rowhomes (i.e. townhomes) are the predominant housing in Philadelphia, developers are prevented from building them in most of Rhode Island because of exclusionary zoning rules that prevent people with lower-income from moving to more well-resourced neighborhoods. These rules, including massive minimum lot sizes, have led to Thankfully, and housing reform, prosperity will not come. Importantly, Philadelphia's proliferation of rowhomes is only possible because driving a car is a choice, not a requirement to have a full life in the city. Without the strength of SEPTA, many more residents would be required to buy and store a car in areas with limited street parking and zero off-street parking spots. I sincerely hope that will change, as the Related : Advertisement If the state is to prove itself as a place worth investing in and keeping people like me in it, transit and housing are the first places to look. Cameron LaFreniere is a volunteer with the Providence Streets Coalition and a fourth-generation Rhode Islander.
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
13-06-2025
- Business
- Yahoo
'It is essential': Riders and advocates plea for a lifeline for RIPTA
PROVIDENCE - Public transportation advocates are making a final push for state lawmakers to rescue the Rhode Island Public Transit Authority from a looming budget crisis that, if unaddressed, could slash bus service across the state. They came to the House Finance Committee in support of a slate of bills that would close or partly close a projected $33 million RIPTA budget deficit for the year starting July 1, protecting bus routes and transportation for the disabled. Jean Ann Giuliano of East Greenwich said RIPTA service had been a "game changer" for her 28-year-old autistic son, allowing him to live independently and ride it to his job at CVS. "RIPTA for him is a lifeline. It is not a convenience for James, it is a necessity. It is essential," Giuliano said at a May 21 House Finance Committee meeting. "Last year, the bus he takes was on the chopping block ... fortunately it was saved. This year it is probably going to be on the chopping block again and for us it is panic time." Amy Jo Glidden, co-chair of Rhode Island Transit Riders, said the cuts to bus service that would be required without money budgeted for transit would result in layoffs at RIPTA, routes cut or made less frequent, and lost jobs across the state by people who are no longer able to get to work. "This issue is personal for me. I do not own a car and rely on the bus to get around," Glidden said. "If RIPTA does not get the $32 million, catastrophe awaits." RIPTA's budget woes have reached this crisis point over the course of many years, but like most transit agencies in the United States, accelerated during the COVID pandemic. The pandemic cratered ridership and sent costs spiraling, but for four years federal aid plugged the revenue gap. Gov. Dan McKee has not suggested any new funding ideas for RIPTA. The "Save RIPTA" alliance has backed seven different public transit funding bills and it is not clear which have the best chance of passing. They include: Appropriating $32 million in the state budget Borrowing $100 million for transit Shifting more gas tax collections to RIPTA Dedicating taxes collected from ride-hailing companies such as Uber to transit Using every year of inflation to calculate the every-two-year gas tax increase (currently only the most recent year is counted.) Last year, the General Assembly provided $15 million − the other half of the deficit was plugged with the last remaining COVID funds − but made no move toward funding the agency long term. The one string attached to the $15 million was a requirement that RIPTA conduct an "efficiency study" by March that would search for ways to run the bus system at lower cost or in a way that generates more revenue. But last year was also a time of turmoil at RIPTA and, after the ouster of former CEO Scott Avedisian, the bus system's board of directors opted to give new CEO Chris Durand's team and consultants more time to search for efficiencies. On Thursday, May 22, Durand told the RIPTA board that the study was still being finished and he expected more documents from it to be available next week. RIPTA did send a "best practices review" of other similar-sized transit agencies from study consultant WSP to lawmakers May 16. It recommended, among other things, eliminating underperforming routes, increasing eligibility verification for paratransit service and shifting some service to "microtransit." On the revenue side, the report said agencies could look for more advertising opportunities. House Speaker K. Joseph Shekarchi said May 22 he has more requests for spending than the state has revenue and he expects RIPTA to find efficiencies. "They have to right the ship," he said about RIPTA. "The reality is they have to change. Public transit is important, for the economy and environment ... We gave them an extra $15 million and all I asked for is an efficiency study that's behind schedule." The only bill in the Save RIPTA package that McKee's administration has weighed in on is a proposal to shift some gas tax proceeds from highway projects to transit. Transportation Secretary Peter Alviti Jr., who is also the RIPTA board chairman, wrote to lawmakers that the Department of Transportation opposes the bill because it would "result in an annual loss of approximately $7 million, significantly impacting our capital program." Liza Burkin, board president of the Providence Streets Coalition, argued at the Finance Committee meeting that it is past time state leaders start making long-term decisions about RIPTA. "It is very sad we are still in the same place. We have studied this over and over and over and over," Burkin said. "The Save RIPTA campaign has chosen seven different ways of funding RIPTA. They are diverse, different ways. It is up to you all to decide. Just choose one or two." This article originally appeared on The Providence Journal: RIPTA is heading toward a crisis. Riders are begging for a lifeline.
Yahoo
13-06-2025
- Business
- Yahoo
What's in RI's proposed $14.3B budget? Help for primary care, RIPTA funds and 'Taylor Swift tax'
PROVIDENCE – Rhode Island House Democrats have unveiled a new $14.3 billion state budget that seeks to bolster the finances of primary care doctors, hospitals and nursing homes without raising income taxes on the wealthy. The proposed tax and spending plan for the year starting July 1 would raise Medicaid reimbursement rates to inject, including federal dollars, $45 million into primary care, $38 million into hospitals and $12 million into nursing homes. Funding for primary care practices would come in part from a new health insurance fee estimated to generate $30 million per year. Although it spares the well-heeled an income tax hike, the House budget resurrects a tax proposed a decade ago on second homes worth more than $1 million, branded the "Taylor Swift tax" after the Watch Hill vacation home of the famous pop star. Proceeds would go to fund the state's low-income housing tax credit. The budget would inject $15 million into the Rhode Island Public Transit Authority, the same amount of money lawmakers added to the statewide bus system a year ago but less than half of the $33 million the agency says it needs to plug a budget hole and avoid service cuts. The extra RIPTA funding will come from a 3-cent-per-gallon hike in the gas tax slated to go into effect July 1 and tweaks to the formula that distributes transportation funds. A 1-cent-per-gallon increase in the gas tax is already set to go into effect in July. The budget, a rewrite of the $14.2 billion tax and spending plan Gov. Dan McKee proposed in January, was quickly passed on an 11-3 vote by the House Finance Committee on June 10, setting it up for a vote before the full House on June 17. "All our colleagues have heard, the Senate has heard and we decided that we needed to take action now," House Speaker K. Joseph Shekarchi told reporters about the money for primary care. "We've heard that our reimbursement rates are low, and that's the primary cause of the health care shortage. We wanted to address that immediately." Senate President Valarie Lawson in an email applauded budget investments in healthcare, RIPTA and child care, suggesting it won't have much trouble passing that chamber. As expected, the House abandoned several of McKee's proposals, including a 50-cent hike in the cigarette tax, buying an office building from Citizens Bank in East Providence and a tax on digital advertising that the governor hoped would pull in $9.5 million next year and $23.5 million annually by 2030. But the House budget agreed with the governor on other proposals, including a new fee on electric vehicles and charging the state's 5% hotel tax to short-term rentals of whole homes on sites such as Airbnb. Other budget highlights include: Truck tolls. The House accepted McKee's plan to turn on the legal-again tolls on tractor trailers in the first half of 2026 and collect an estimated $10 million in state revenue. Washington Bridge: $22 million in state dollars to match federal funds to build a new westbound Washington Bridge. Education: The House proposal would spend $16.5 million more on education than McKee proposed and $59 million more than the current-year budget. Conveyance tax: A 63% increase in the real estate conveyance tax on all home purchases, which doubles for the portion of a sale over $800,000 is proposed with proceeds going to services for homeless Rhode Islanders. The tax increase is projected to raise $8.4 million next year. Airbnb: Extends the 5% state hotel tax to whole-house rentals, something lawmakers rejected last year but McKee's budget expects will generate $4.7 million per year, with a part of the collections also going to homeless services. DMV: A $1 hike in the Division of Motor Vehicles "technology fee" to $3.50 per transaction. Superman Building: The House budget included a provision, already passed as a standalone bill in the Senate, that would exempt the owner of the vacant Industrial Trust Tower in Providence from sales tax on construction materials while claiming a maximum in other state incentives. Parking: The state's 7% sales tax would be charged to parking, generating $3.2 million per year. Nicotine pouches: The tax applied to the wholesale cost of tobacco products would be expanded to synthetic nicotine pouches such as Zyn, generating $12 million per year. Vacation home tax: The "Taylor Swift Tax" would not go into effect until the fiscal year that starts July 1, 2026 and no estimate was provided of how much it would eventually raise. Longtime advocates of increasing taxes on Rhode Island's highest-earning residents hoped the budget pressure facing the state this year would convince top lawmakers that the time was now right to do it. They proposed a 3% surcharge on income above $625,000, which was estimated to generate $190 million in annual revenue. And as lawmakers waited for the final details of the budget to be hammered out on June 10, the Working Families Party camped outside the State House with a box truck showing illuminated messages of support for a tax hike, such as, "Save Rhode Island. Tax the Rich." But Shekarchi told reporters that lawmakers decided against a tax hike, at least until the state knows whether Congress is going to pass a tax cut bill that could slash Medicaid funding and shift more costs to states. "We don't know what's going to happen in Washington," Shekarchi said. "We don't know what changes are going to be made in the federal tax code. We felt comfortable enough to do the non-owner-occupied taxes over a million dollars at this time, and we will revisit that issue when we have more clarity from Washington." But Working Families Political Director Zack Mezera said what's happening in Washington is even more reason to make the "1% pay their fair share," not an excuse. 'Today's budget shows that state leadership would rather raise gas taxes for working families than increase taxes on millionaires," Mezera wrote in a news release. "As President Trump and his allies advance destructive cuts that could cause over 240,000 Rhode Islanders to lose Medicaid and hundreds of educators and care workers to lose their jobs, we need bold action to raise revenue now – otherwise working people and small businesses will be paying the price for years." With $15 million from the budget to fill a $33 million projected shortfall, it looks as though RIPTA is going to need to scale back what it does, but Shekarchi said it would not necessarily mean large layoffs or route cuts. "I think they need to look at everything," he said. "Maybe it's smaller buses, maybe it's addressing the ride schedule, maybe it's a slight fare increase, maybe it's looking at management positions. That's why we mandated, when we gave them $15 million last year, they do an efficiency study and find out the solutions." Despite the prospect of having to make painful cuts this summer, RIPTA CEO Christopher Durand said the bus system is "grateful" for the additional permanent state revenue. "The agency has long needed a consistent funding stream to allow us to better support getting Rhode Islanders to work, school and healthcare," he said in an email. "The last time the agency saw a permanent change in its funding structure was over ten years ago; this is a needed improvement, which we are thankful for." This article originally appeared on The Providence Journal: RI's proposed $14.3B budget: Primary care; RIPTA; 'Taylor Swift tax'
