Ordinance & License Committee - Regular Meeting

Yep, we're ready when you are sure. We'll go ahead then get started with the Board of Public Works meeting or excuse me, Transit Commission meeting for Thursday, June 18th, 2026. We'll start with a roll call. Chad O'Donnell, Kevin Riley, Joe Piper, Eileen Nicholas. Alright, with that will move to the Pledge of Allegiance. All right, anybody here for public comment? Seeing none, I'll move to election of officers.

Kevin Riley makes a motion that Chad O'Donnell be chairperson for the next calendar year.

Miklitz seconds.

Alex, I believe we need to nominate a co-chair as well? A vice chair? Doing it all in one would be ideal.

And then Kevin Riley also nominates himself as vice chair.

And just for clarification, it wouldn't be the calendar year. It would be the, I don't know, the all the manual year. All the dramatic year. Yeah.

Okay.

I still second.

All right. A motion and a second. Any discussion? That will take a vote. O'Donnell? Aye.

Kevin Riley? Aye. Piper? Aye.

Miklitz? Aye. All right. Motion passes. We'll move to item 5A.

5A, we have the presentation from Baker Tilly on the 2025 Transit Financial Audit. Jody Dobson, a principal at Baker Tilly, is coming up to give that presentation. So I'll turn it over to Jody.

Thank you very much for having me here tonight. So you have in front of you a two-page kind of summary of the audit process and results, and then there's also the full financial statements. So similar to prior years, our audit process starts in the fall with planning. We work with management to understand what may have changed during the year in processes or systems or contracts, et cetera. and use that to design how we want to complete our audit process. We use a number of different procedures to obtain audit evidence, whether that be confirmations, tracing things to supporting documentation, completing analytic procedures, testing controls, et cetera. But ultimately, we're able to issue our audit opinion on the financial statements for the transit operations. They received what we call an unmodified or a clean opinion. So that's the highest level of assurance that we can give. And that says that the financial statements are fair presentation in all material respects of the financial position and the results of operations for the year. In addition to the financial statement audit, we also assist with the citywide single audit. Because of the receipt of federal grant funding, the transit operations, their grants are typically part of that single audit that has to be completed, both for state and federal funding. So there we test both controls and compliance with the grant agreements, and there were no issues identified this year for the transit operations. So then if we go to the next page here, we've got just a couple financial highlights. The top of the page looks at the revenues for 2024 and 2025. And the first thing I'll point out is that they're very consistent, a slight increase in 2025 over 2024, but really stable operations, as well as the mix of information or of sources is very stable year over year. And then at the bottom, we have the expenses. And here, the expenses actually decreased a little bit in 2025. As we looked there, there was a small decrease in the overall labor and benefits, as well as materials and supplies and purchase transportation. The purchase transportation related to some changes in the Route 1 extension. That was anticipated there But overall the mix again relatively consistent with labor and benefits being the largest portion of the expenses and that's consistent with every transit operation I work with We do see that in both 2024 and 2025, the revenues outpaced the expenses or exceeded the expenses, and that was by design. Management has been working to draw down some of the ARPA or CARES funding that was available, and in the process of doing that is able to take some of the local subsidy from the city and set that aside into the reserve account so that if there are future years where an unanticipated expense were to occur or something like fuel is above budget, that there is a reserve to pay for those types of items. And so I did wanna note in looking at the overall financial statements that the reserve fund at the end of 2025 was just over 1.6 million. So I think overall, the audit this year went very smoothly. You know, we didn't have any difficulties. Management gets us everything we need and has answers along the way. And the overall results look very stable and positive. With that, I'm happy to answer any questions as well.

If I can just say one thing, and I apologize to Carrie, but Carrie Blado, our finance director, is here, and she does the bulk of this. This is the fine work that she does.

member jody thank you for your work and gary also thank you for the work that you do um i'm so i'm on the balance sheet and i just had a couple questions about the reserve fund so i know alex and brian and i have talked about that so i see I should have brought my cheaters. So I see the bump of about a million bucks from 24 to 25 and other funds reserve, right? And I also see the line above it due from other funds jumped by about a million too. So I guess it's a two-part question. So where is the COVID money? In what buckets on the balance sheet is the COVID money sitting currently? I guess that's my first question.

so the amounts that you have not yet drawn are not actually on the statements they're tracked in a grant available for you to draw but you have to have qualified expenses to draw those additional funds so where's that so is that cash still sitting with the feds yes okay i guess that's the note that i think that's the nugget that i that i always fail to remember is that yeah we have to we have to basically request reimbursement and that cash is still sitting with the feds yeah we

do have we control 1.6 million that is in that reserve and that is for operating but also for future capital like the buses we're going to buy next year that's that money is going to go towards that so we that 1.6 is in our control so how much is left for us to draw uh 2.8 million is left And that was as of the end of last year. Because we just, this is the lovely part of our financial world, because the state just gave us our state percentage, we have to, Carrie now has to race through and get all our financials up to date so we can give a more accurate number. But we can say most likely we're probably, ballpark, we're probably at about Right at this state, we're probably at about 2.3, 2.4 million left.

Okay, and so that's over and above the million six that's on the balance sheet? okay and can we earn interest on that million six or do we have to worry about violating some rule or arbitrage or anything like that i do believe that money goes to the city it's not it's not anything that we control that's more mr shiro's world so i guess earning interest there okay so the million six that's money that we've pulled already from the cares money So how can we sit on $1.6 million if we don't have a corresponding expense to go with it to tell the government we need to be reimbursed for that?

So essentially what you do is you use your existing expenses each year to draw the CARES funds and get reimbursed for those expenses. And then in lieu, you're saying, because we've done that, our local share that would have covered those costs goes into the reserves. Where if you didn't have the CARES funds, the local share that had been budgeted would had to have paid those costs.

And if transit doesn't take the local share, the state of Wisconsin takes it away from me because of ERP and levy limits. Correct. So that's the fun part of this, is even though we're using CARES dollars to offset operating costs, I still have to take the levy money or I lose it. Okay, that's not a question. It's more of a statement, Jody.

That is the fund balancing, but it allows you to have this for the capital or other things once the CARES funds are gone.

Okay.

And it will smooth out, you know, the future years, you know, where we're talking. It will allow us to smooth that out so we're not on a cliff, you know.

OK, and one more question and then I'll yield to see if other folks have questions. But with the COVID money, I know there was some deadlines as it relates to spending that. Can you remind me, Jody? Do we have a deadline with this doubt with these dollars?

The only one that has a deadline for the transit ARPA dollars is is September. 30th of 2029 it's the end of the 29 fiscal year i can't officially say or we can't officially say we're done with our arpa dollars but we are most likely done with our arpa dollars we'll be closing that grant sometime this year the other two grants that we have the cares and Carissa funds, there is no sunset, but the FTA has not warned us, but has encouraged grantees to move that money along because the administration and Congress is looking at that. And that's not surprising. I mean, that's just doing their due diligence, you know, so. Jody, thank you.

I'll yield.

Any other questions?

um i just thank you for your for your work i just have one question and this might be just a matter of the way that uh things get reported but it appears to me the the state subsidy and the federal subsidies have decreased slightly and the city of waukesha's subsidies gone up slightly. Are we seeing that as a trend where our portion of the operating costs or operating revenues are going to be continuing in that direction?

That is one of the reasons why we've done all the service changes that we have is to long-term put ourselves in a position that we can be in a financial situation that works for the city and for the system. I don't know if you recall, but from 24 to 25, the combined state federal expense for operating went from 59.17% to 55.93%. So it was a three and a quarter percent decrease, which been in this now for about 28 years, I've never seen a decrease that significant in that short of time. And we had another pretty decent decrease this year. So yeah, that is a concern. It's not as much the federal as it is the state funding. The state funding, we're still at 2011 levels of state funding when you look at all, not us, but like aggregate across the state for transit funding.

That was my understanding. I was just, thank you for Helping me see that. Yeah, we do need to end. I commend the transit for all their efforts to be efficient and lean and plan for these future. Future economic possibilities.

Jody got one more question one of my other favorite topics is OPEB and I see the fact that we're it appears based on And again, I'm I read the note and I'm looking at the cash flow statement But it looks like we're in a pretty good spot as it relates to OPEB And is that because we really only have one employee in the transit? Okay Answering my own question. Okay.

Thank you Never hurts to confirm things

All right, any other questions? We don't need to take action on this, right?

It's just a matter of report.

All right, well then we can move to item 6A.

Jody, thank you. You have approval of the minutes from May 21st.

Piper, I'll make a motion to approve the minutes as presented.

Kevin Reilly, seconds.

All right, we have a motion and a second. I'll go ahead and take a vote. O'Donnell, aye. Kevin Reilly, aye.

Piper, aye.

Miklitz, aye.

All right, motion passes. We'll move to item 7A.

Item 7A is to review and act on proposed change order to our 2027 bus purchase from Gilly LLC. Last year, or last fall, the council approved the purchase of three buses with delivery in 2027. The lead time on buses is extending But we did have a small change order we're looking to, or we've proposed. And this was after we have our pre-production meeting. It's a meeting where we go in great detail. It takes a couple of hours with the manufacturer going through every component of the bus. And there were some things that were... Missing from our standard order that we would like to have just for consistency, parts, inventory, consistency for the drivers, and those type of items was about $1,300 difference from what they originally had quoted. And then another thing that we are looking to add, and this is a safety feature, is to have electronic assist added to the steering system. One of the things that our drivers, our trainers, our supervisors have all said is that the Gillig buses don't turn as well as our new flyer buses. That's our two makes that we have. and so we asked about that and unfortunately you can't just put a different steering wheel we have to get a different steering system and this was its electronics assistance it's used in a number of systems around the country it really improves steering it's a safety feature that If we can avoid one turning accident with this, it's probably well worth the money, or it is well worth the money, because turning accidents tend to be the most expensive ones that we have and the most climactic for the parties involved. So the total increase to the bus costs would be just over $4,500 per bus. It's still well below what our CIP amount was. So the total would go up to 664,752 per bus. And what we had in the CIP was 690. I just was reading an article in one of our trade magazines Fixed route buses are typically now in the $700,000 to $800,000. That's diesel buses, so we're still pretty low. And this should be the final cost. There's no other adjustments to the cost. The total increase is less than 1% of the total cost of the bus. So we'd recommend approval.

I'll make a motion to approve that.

Kevin really seconds.

Alright, any discussion?

That will take a vote.

O'Donnell I Kevin Riley I Piper I make let's I alright motion passes will move to item 7B 7B is on hold.

Unfortunately, Wistot has not gotten us the operating assistance contract, so per the city city attorney. Since we do not have the agreement, we cannot act on that one.

So then we'll move to item 7C.

7C is review and act on the paratransit aid agreement with the state of Wisconsin Department of Transportation for 2026. We do have this agreement, and this provides funding for our Metrolift for our disabled riders. And the good news with this is that we received a slight increase of about 5%, just over $4,000 more than last year's. So the total funding amount is $91,209. And so we would just recommend approval.

Ms. Piper, I'll make a motion to approve. Kevin Riley seconds.

All right, we have a motion and a second. Any discussion? Seeing none, I'll take a vote. O'Donnell, aye.

Kevin Riley, aye. Piper, aye.

Miklitz, aye. All right, the motion passes. We'll move to item eight.

um 8a is um and this is more of a courtesy for this commission we've talked a lot about uh update on our service levels and um oh sorry my screen just went bad but the city administrator has asked that at a future council meeting this summer that we present on the changes we've made since the council as a whole does not have as close of a view of the changes we've made. And so I'm just gonna quickly go over the service changes. It's very much like the update we provided in December, but I just wanted to go over it. And we'll go in a little more depth when we give this presentation to the council, As always, please ask questions if you have any. Just the first bit is we did implement some changes come for June, June 15th on Monday, and they seem to be going well. We do have some more changes for the weekend. but they are going well. And then we had some additional changes, minor reductions that will take effect in August and some other service changes. So when the August, and they've already been approved by the council. When the August changes take effect, um the total weekly service hours in the city will have been reduced by about a third from 2020 so pre-covered levels so we're dropping from in this table shows or this chart shows that we're dropping from just under 900 hours of service in within the city of waukesha to just over 600 hours And looking at this, kind of going through the archives, this is the lowest level of service hours that we've had in the city since 1990. It's about, on an annual basis, about 31,000 hours, and it's about where we will be when these changes take effect. And also, just wanted to point out, actually the city administrator wanted us to point out that the city's contribution to transit, financial contribution, is the lowest since 2011. That was part of our part of the financial management plan. And we've gone over several times, we've gone over all the changes. I think one thing I'll just say is with all these studies and initiatives that we've done, for a system our size to do what we've done in the last five years, this would take typically an aggressive approach. 10 years, but we've done a lot in this time. And a lot of it, though, has to do with sewer packs, been a great partner with getting us these studies in a timely fashion. And then again, just kind of this on page two, we just kind of go over the all the different changes, you know, just more highlighted some of the things. But one thing I will point out is related to capital. is because of the changes on the operating side, the last item, starting next year when we replace those buses, we're getting three, we're getting rid of five. Our plan is to ask for three for 28 and get rid of six. So we're gonna reduce the fixed fleet over a course of time by six buses. So that's over $4 million less in fleet replacement costs over it. over the next three or four years. One real positive thing, and one of the things we didn't want to just cut service just to cut service, we want to minimize the impact as much as possible on the passengers, but we did want to improve our ridership efficiency And the rides per hour is our big measure of that. And as you can see, from 22 to current, we've increased from just over 6 1⁄2 to almost 9 1⁄2, so that's about a 45% increase in our ridership efficiency. So that's something that... So more people on fewer buses. and then the last thing just kind of factoring in here is metrolift I mean, it's on-demand service, so it's not like we have a set amount. It's based on the demand, and as we have stated several times, we've seen a pretty strong growth out of COVID, and now we're above levels. Actually, for 2026, we're probably going to hit about 15,000 rides, which we haven't seen that since 2012. And we had much more buses, much more. You know, we had many more buses out and a total fleet of seven. Right now, we're doing that with a total of four, but that's becoming more and more difficult for us to do. So we are going to request an additional bus in order to meet that demand. But to do it with five instead of seven is still pretty good. But we've got software that helps us with that. But that does the increased Metrolift demand does increase the number of hours, the driver hours related to that. And from 24 to 25, we've had an increase of basically seven tenths of a full time position. So basically a part time position of 28 hours. So that is a factor, too, that we're going to have to deal with financially as well. So. But that is, and I'm sorry if I went too fast, but that is just a quick overview of the presentation we're going to provide in the council next month.

Thank you very much. Anybody have anything else? That we are adjourned.

Thank you. Thanks, Brian. Thank you, Barry. Thank you.