Memorandum

City of Lawrence

City Manager’s Office

DATE:	11/5/08
TO:	David L. Corliss, City Manager
FROM:	Casey Liebst, Budget Manager
CC:	Cynthia Boecker, Assistant City Manager Diane Stoddard, Assistant City Manager Jonathan Douglass, Assistant to the City Manager
RE:	Transit Items Post Sales Tax

Below is a summary of the status on a number of items related to the transit sales tax.

• MV Contract.  Preliminary negotiations with MV Transportation, Inc. are underway.  A draft contract is being reviewed by staff and should be coming to the City Commission for their review, and if appropriate, approval. 
• KU Consolidation, Coordination, Merger.  Weekly meetings continue with the University of Kansas to work toward the goal of a coordinated or merged system by July 1, 2009.  A meeting with KU officials has been scheduled to review the work of the planning team and to discuss issues related to the appropriateness of their involvement in the recruitment of a new Transit Administrator for the City. 
• Budget Amendments.  The City’s 2009 Budget included authority to spend the 0.2% sales tax for transit and the 0.3% sales tax for infrastructure.   However, the budget will need to be amended to provide the authority to spend the 0.05% transit sales tax approved by the voters.  Staff is also working to determine the most transparent way to account for the sales tax proceeds and expenditures. 
• Funding for first five months.  The timing of the first distribution of sales tax receipts will create a cash flow issue for the Transit Fund.  It will be necessary to pay for the operations of the first five months of the system using other City funds.  In essence, the Transit Fund will borrow funds from another city fund, which will then be paid back over a period of no more than three years. 
• Fleet Replacement.  Historically, the city has replaced three Paratransit vehicles each year, using 100% state funds.  These vehicles, which are ordered using a cooperative purchasing arrangement through the state, are scheduled to be ordered in November.  The City currently has sufficient dedicated federal funds and transit reserve funds to replace seven fixed route vehicles.  The remainder of the fleet will be replaced as funds are available.  The issue of the appropriateness of the size of the fleet continues to be explored.  However, the federal grant award documents specifically state that we must acquire 30 foot heavy duty buses.  It would be possible to amend the grant award.  However, this would significantly delay the procurement process. 

More information on these items will be provided to the City Commission as it becomes available.