BARTs Business Model What is Public Transits Business Model? July - - PowerPoint PPT Presentation

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BARTs Business Model What is Public Transits Business Model? July - - PowerPoint PPT Presentation

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BARTs Business Model What is Public Transits Business Model? July 31, 2018 BART Background Basic Facts Regional rail rapid transit Elected Board of Directors: 9 Comprised of 3 Counties: - Alameda, Contra Costa & San

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BART’s Business Model

July 31, 2018

What is Public Transit’s Business Model?

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SLIDE 2

2 BART Background

Basic Facts

  • Regional rail rapid transit
  • Elected Board of Directors: 9
  • Comprised of 3 Counties:
  • Alameda, Contra Costa & San Francisco
  • Serves San Mateo
  • Will serve Santa Clara in 2019
  • 414,166 weekday riders (FY18)
  • 121 revenue route miles
  • 5 lines, plus Oakland Airport
  • 48 stations
  • 48,000+ parking spaces

July 31, 2018 SPUR: What is Public Transit’s Business Model?

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3

  • FY19 Adopted Budget
  • Operating:

$ 922 M

  • Capital:

$1,355 M

  • Rail Farebox Ratio (FTA FY14):

(Fare Revenue/Operating Costs)

  • SF/OAK (BART)

78%

  • NYC (NYCTA)

63%

  • Wash DC (WMATA)

62%

  • Boston (MTBA)

60%

  • Philadelphia (SEPTA)

55%

July 31, 2018 SPUR: What is Public Transit’s Business Model? BART Background

Basic Facts

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Weekday Trips by Sub-Area

  • 52%: Transbay
  • 27%: intra-West Bay
  • 21%: intra-East Bay

Better BART, Better Market Street

2/3rds of BART trips begin or end on Market Street

Weekday Ridership (FY10 – FY16)

  • Growth:

29%

  • Growth:

~100,000

  • June 2015

433,000

4 SPUR: What is Public Transit’s Business Model? July 31, 2018

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Related to the BART Strategic Plan

  • Core: Related to BART’s Vision and Mission

– Seamless Mobility – Move people safely and reliably – Reduce Risk (safety/service/reputational/financial) – How do today’s decisions affect BART’s long-term outlook?

  • Dynamic: Related to BART’s current and future

environment

– Improve Customer Experience – Generate Revenue – Reduce Costs/Cost Neutral

July 31, 2018 SPUR: What is Public Transit’s Business Model?

BART’s Business Model

5

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BART Strategic Plan Framework

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Strategic Plan and FY19 Budget

Strategic Plan provides policy direction to Budget process & decisionmaking Strategic Plan function: Linking Policy guidance, Risk information, and Budget decisions

July 31, 2018 7

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Ten-Year Financial Outlook

July 31, 2018 SPUR: What is Public Transit’s Business Model?

  • $70
  • $60
  • $50
  • $40
  • $30
  • $20
  • $10

$0 $10 FY19 FY20 FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28 Millions

8

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BART DAS, July 2014

Riders by Station, by Time of Day

500 1000 1500 2000 2500 3000 3500 4000 4500 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00

Combined Station Entries & Exits in 15 Minute Increments

MT EM PL CC 19th BK 16th 12th 24th MA BP ED PH

Montgomery Embarcadero

July 31, 2018 SPUR: What is Public Transit’s Business Model? 9

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10 The Before and After Effects of BART

Transbay Service

July 31, 2018 SPUR: What is Public Transit’s Business Model?

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Recent BART Ridership Trends

101.0 103.7 110.8 117.8 117.1 126.0 128.5 124.2 120.6 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18

Annual Trips (millions)

July 31, 2018 SPUR: What is Public Transit’s Business Model? 11

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Rail Ridership Trends At Peer Agencies

July 31, 2018 SPUR: What is Public Transit’s Business Model?

0.2%

  • 10.4%
  • 4.7%
  • 1.3%
  • 0.2%
  • 0.8%
  • 4.5%

BART WMATA (DC) MARTA (Atlanta) CTA (Chicago) MBTA (Boston) NY MTA SEPTA (SE Penn)

Year-to-year % change (Calendar Year 2016 vs 2015)

Note: These data are based on “unlinked passenger trips.”

Source: http://www.apta.com/resources/statistics/Documents/Ridership/2016-q4-ridership-APTA.pdf Unlinked passenger trips 12

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Transbay AM Floating Peak Hour, Peak Direction Ridership

2,500 5,000 7,500 10,000 12,500 15,000 17,500 20,000 22,500 25,000 27,500 30,000

Peak Hour Ridership

2015 2016 2017 2018

July 31, 2018 SPUR: What is Public Transit’s Business Model? 13

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Ridership by Day of Week

July 31, 2018 SPUR: What is Public Transit’s Business Model? 14

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Ridership Trends

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Fare Revenue

$274 $278 $291 $299 $318 $353 $353 $383 $399 $392 $393 $9 $19 $27 $33 $39 $35 $40 $41 $43 $49 $53 $54 $60 $63 $60 $61

$0 $100 $200 $300 $400 $500 $600 FY08 FY09 FY10 FY11 FY12 FY13 FY 14 FY 15 FY 16 FY 17 FY18 Est

Annual Fare Revenue (millions)

Core System CPI-based Fare Increase SFO Extension Date of Increase Average Increase 1/1/2006 3.7% 1/1/2008 5.4% 7/1/2009 6.1% 7/1/2012 1.4% 1/1/2014 5.2% 1/1/2016 3.4% 1/1/2018 2.7% July 31, 2018 SPUR: What is Public Transit’s Business Model? 16

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Capital Sources

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Total excludes $7M in reimbursable capital expenses

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FY17-31 CIP Major Investment Programs Need and Funding

Need and Funding (millions)

$- $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000 $8,000 $9,000 $10,000

Capital Asset Renewal Programs Big 3 (including TCMP) Core Capacity (Excluding TCMP) Access Enhancement and Station Mod BART Metro Earthquake Safety Program System Expansion Other Needs

Committed Funds Discretionary Funds Funding Gap

July 31, 2018 SPUR: What is Public Transit’s Business Model? 18

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Capital Budget History

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Operating to Capital Allocations

July 31, 2018 SPUR: What is Public Transit’s Business Model?

$428 $467 $498 $524 $498 $486 $524 $561 $569 $610 $637 $690 $743 $24 $34 $50 $8 $34 $59 $64 $84 $113 $148 $144 $123 $127 $63 $70 $66 $68 $68 $68 $62 $62 $58 $56 $49 $50 $51

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% $- $100 $200 $300 $400 $500 $600 $700 $800 $900 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 Budget % Operating Funds Allocated to Capital/Access Operating Expenditures ($M) Operating Expense Allocations to Capital, Access, and Reserves Debt Service % of Operating Funds Allocated to Capital/Access 20

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Related to the BART Strategic Plan

  • Core: Related to BART’s Vision and Mission

– Seamless Mobility – Move people safely and reliably – Reduce Risk (safety/service/reputational/financial) – How do today’s decisions affect BART’s long-term outlook?

  • Dynamic: Related to BART’s current and future

environment

– Improve Customer Experience – Generate Revenue – Reduce Costs/Cost Neutral

July 31, 2018 SPUR: What is Public Transit’s Business Model?

BART’s Business Model

21

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Near Term Focus and Issues

  • Operating Essentials

– Open BART to Antioch – May 2018 – Integrate New Rail Cars into revenue service – Staff an expanded Hayward Maintenance Complex

  • Initiatives to Improve Customer Experience, Reduce Costs,

Generate Revenue

– Quality of Life

  • Homelessness
  • Cleanliness
  • Fare Evasion
  • Safety & security

– Administrative process efficiency improvements – Access and Parking improvements

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Ridership and Employment Trends

July 31, 2018 SPUR: What is Public Transit’s Business Model?

300,000 320,000 340,000 360,000 380,000 400,000 420,000 440,000 460,000 480,000 500,000 1,800,000 1,900,000 2,000,000 2,100,000 2,200,000 2,300,000 2,400,000 2,500,000

BART Ridership vs SF-Oak-Hayward MSA Employment

SF-Oakland-Hayward MSA Employment Avg Weekday Ridership 12 per. Mov. Avg. (SF-Oakland-Hayward MSA Employment) 12 per. Mov. Avg. (Avg Weekday Ridership) 23

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Non-Passenger Revenue Opportunities

  • Transit Oriented Development
  • Advertising
  • The BART Digital Railway and Digital Strategy

July 31, 2018 SPUR: What is Public Transit’s Business Model? 24

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Current TOD Portfolio

Status Station Total Units Affordable Units % Affordable Office (SF) Retail (SF) Castro Valley (1993) 96 96 100% Fruitvale Phase I (2004) 47 10 21% 27,000 37,000 Pleasant Hill Phase I (2008) 422 84 20% 35,590 Hayward (1998) 170 0% Ashby (2011) 0% 80,000 Richmond Phase I (2004) 132 66 50% 9,000 MacArthur Ph I (2016) 90 90 100% San Leandro Ph I (2017) 115 115 100% 5,000 1,000 West Dublin (2013) 309 0% East Dublin (2008) 240 0% South Hayward Ph I (2017) 354 152 43% 1975 613 31% 112,000 82,590 MacArthur Ph II (begins 2017 & 2018) 787 56 7% 39,100 San Leandro Ph II (2017-2019) 85 85 100% Walnut Creek (began 2017) 596 0% Coliseum Phase I (2017-2019) 110 55 50% West Pleasanton (2017-2019) 0% 410,000 Pleasant Hill Block C (begin 2018) 200 0% Fruitvale Phase IIA (begin 2018) 94 92 98% 1872 288 15% 410,000 39,100 GRAND TOTAL 3847 901 23% 522,000 121,690 Completed TOTAL COMPLETED TOTAL UNDER CONST. & PLANNED Construction/ Planned

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Land Lease/Sale Participation* Ridership

Revenue from Transit-Oriented Development

  • Revenue is long term: from

choices made 10-20 years ago

  • Past priorities: ridership,

parking replacement, long term revenue

  • City Redevelopment played

major role in most completed projects

  • Decisions made today could

affect revenue in 7-10 years

2018 BART TOD-Generated Revenue

*Transit Benefit Fees, Revenue Sharing for Retail, Parking Garages

$740k $184K ~ $3 Million

July 31, 2018 SPUR: What is Public Transit’s Business Model? 26

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Revenue Share Opportunity

Based on OUTFRONT net revenue projection, total estimated payments to BART could be approximately $272M, of which $160M is guaranteed.

$9.0 M $12.0 M $12.0 M $12.0 M $12.0 M $13.0 M $14.0 M $15.0 M $16.0 M $17.0 M $18.0 M $10.0 M $.5 M $2.4 M $4.7 M $6.0 M $11.3 M $11.6 M $15.1 M $15.2 M $15.1 M $15.1 M $15.0 M $- $5,000,000 $10,000,000 $15,000,000 $20,000,000 $25,000,000 $30,000,000 $35,000,000 October 1, 2018 - June 30, 2019 FY20 FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28 FY29

BART Revenue Share Opportunity (based on Outfront projection) Signing Bonus Payment to BART (Guaranteed) Minimum Annual Payment to BART (Guaranteed) July 31, 2018 SPUR: What is Public Transit’s Business Model? 27

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Digital Railway – Current State

FY16

Fiber & Cellular Revenue

$8.5M

  • Underground Cellular Network
  • Above Ground Cellular Towers
  • Dark Fiber

FY17

Fiber & Cellular Revenue

$9.7M

July 31, 2018 SPUR: What is Public Transit’s Business Model? 28

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Digital Railway – Business Units

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Areas to Watch

  • Potential for further ridership declines
  • Ballot measure to repeal SB1, reducing BART’s STA

allocation

  • Next Economic Downturn
  • Impacts of National Policies

July 31, 2018 SPUR: What is Public Transit’s Business Model? 30

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Discussion and Questions Concluding Remarks

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