- System Redesign
- Economic Impact Analysis
- Fare Equity
- Rail Car Replacement Study
- Financial Analysis and Economic Forecast:
- Strategic Plan
As part of a comprehensive examination of RTA's operations and impact on the Greater Cleveland and Cuyahoga County community, a series of five studies (the "pillar studies") are being conducted:
- System Redesign: Jarrett Walker + Associates have been selected to review RTA’s current system design and recommend improvements under various funding/budget scenarios, and to develop strategies to cost effectively address service frequency and service coverage goals for the maximum benefit of both current and future riders.
- Economic Impact: To quantify RTA’s economic impact on the region, and benefits to its residents.
- Fare Equity: LTK Engineering Services has been engaged to evaluate RTA’s fare structure, the impact of fare changes on ridership and revenue (elasticity), and the impact of potential fare changes on low income and minority populations, and to develop scenarios to balance ridership and revenue goals.
- Rail Car Replacement: To prioritize HRV vs. LRV replacement strategy, recommendations for fleet replacements vs. fleet rehabilitation, recommendations for maintenance practice modifications, structural enhancements and potential component/system modernization upgrades to extend the current life and improve vehicle reliability.
- Financial Analysis and Economic Forecast: The Greater Cleveland Partnership (GCP), Northeast Ohio’s Chamber of Commerce, offered to complete an independent, financial analysis and economic forecast for the Greater Cleveland Regional Transit Authority. WSP, a global leader in transportation consulting, was selected by the Partnership to complete this analysis.
These studies will provide input into a new Strategic Plan process which will begin in 2019.
Community Engagement Process Completed
We have now completed the final phase of the System Redesign Study’s community engagement process. During this round of engagement, riders and non-riders alike were asked to comment on two prospective bus system designs, one based on current funding levels and another that reflected a 25% increase in service hours. Both service designs were based on the community’s collective transit priorities identified earlier in this study: as 65% of the service was allocated to enhanced frequency, while the remaining 35% focused on market coverage.
Over the past few months more than twenty-five community meetings and customer intercepts were held. Additionally, nearly 1,300 individuals completed the most recent on-line survey, providing invaluable insight into the community’s opinion of the two service alternatives. Now our consultant, Jarrett Walker and his team are reviewing these results as they prepare their final recommendations.
On Tuesday, December 17, Jarrett Walker will present to the community his team’s final report at RTA’s Board of Trustees meeting. The report will summarize the study’s entire process and offer suggestions on how RTA can best design service to meet transit needs based on available and potential resources.
During the 1st Quarter of 2020, RTA’s Management and Service Planning professionals will have an opportunity to review the study’s findings and determine how best to implement the recommendations to better address the transit needs of the community. Implementation of any of the study’s recommendations will require both Board approval as well as further community involvement.
Jarett Walker + Associates have been selected to review RTA’s current system design and recommend improvements under various funding/budget scenarios, and to develop strategies to cost effectively address service frequency and service coverage goals for the maximum benefit of both current and future riders.
Two on-line surveys were administered earlier this year to solicit comment from both riders and non-riders alike regarding service priorities.
A series of community engagement meetings were held throughout the month of May. At these meetings, attendees were asked to comment on two different service plan variants (linked below) – one with a goal of maximizing frequency (attracting as many riders as possible) and the second focused on maximizing market coverage (being available in as many places as possible).
Both plans were developed within the constraint of the current operating budget. Each of these plans is offered to solicit comment regarding the community’s service priorities, with the ultimate outcome being a determination of the appropriate balance between ridership and coverage.
Cleveland State University’s Center for Economic Development (The Center) was contracted by RTA to quantify the economic benefit RTA generates annually for Cuyahoga County. In addition to the direct economic impact resulting from RTA employees residing in the County, The Center also measured the economic effect of RTA’s annual in-county expenditures as well as the economic benefit of purchases made by RTA and supplier employees.
Transit Impact on Cuyahoga County Property Values: $2.2 Billion
- Property values increased by 3.5% within a decade for previously unserved 429 Census Tracts which received some transit service
- 2010 median-based estimate of property value for those 429 Census Tracts is $65.7 billion in 2019 dollars
- The derived property value increase attributed to transit access is $2.2 billion in 2019 dollars
RTA’s Economic Impact to Cuyahoga County: $322 Million Annually
|2017 Economic Impact on GCRTA for Cuyahoga County|
|Operations||$292 Million||2,837||$200 Million|
|Capital Investments||$30 Million||140||$8 Million|
|Total||$322 Million||2,977||$208 Million|
RTA’s direct spending in Cuyahoga County accounts for $182 million of the total economic return to the County. An additional $35 million is a result of local businesses selling goods and services to RTA, while the final $104.6 million is a function of goods and services purchased by RTA and supplier employees residing in the County.
In 2017, RTA created and sustained nearly 3,000 jobs in Cuyahoga County.
- 1,800 – RTA employees resided in the County
- 1,177 – Jobs created from RTA-purchased goods and services in the County and jobs created from goods and services purchased by RTA and supplier employees.
Transit Impact on Employment: $485.8 Million
- An estimated $485.8 million of annual earnings is brought home by those who depend on GCRTA transit services to get to work.
- Improved transit access in urban neighborhoods results in:
- A drop in poverty by nearly 12.3%
- Employment growth of more than 3%
- “Choice” transit riders also share in transit generated benefits.
- Collectively “choice riders” saved more than $51 million in 2017 by riding transit rather than driving.
- And all residents share in these collective benefits:
- Less congestion on roads results in enhanced public safety and less stress on an aging infrastructure.
- Cleaner air. Fewer cars on roads results in fewer pollutants released in the atmosphere.
- Fewer cars. Reduces the need for more parking, allowing for better land use in urban areas.
- Millennials have an affinity to taking transit. A robust transit system benefits employers in attracting a young, talented workforce.
Community Loss Without Transit:$448.7 Million
- Nearly 25,000 riders a day, are dependent on RTA to get to work
- Dependent work-trip commuters earn $485 million annually.
- Elimination of RTA service puts at risk 66% of these job holders.
- Not only would approximately $320 million in wages be lost, but unemployment cost would grow by nearly $6 million and result in a further strain on the region’s social services network.
- Daily, more than 3,000 Greater Clevelanders are dependent on RTA to access healthcare services. Without RTA, appointments would be cancelled or missed, resulting in a $103 million loss to the healthcare industry in efficiency and missed appointments.
- Twenty-five percent of RTA riders are students. And three out of four students depend on RTA service to get to school. The Cleveland Municipal School District alone saves $28.7 million annually by using RTA services instead of CMSD school buses.
- Provide the Authority with a framework to develop fare policy for the next 10 years.
- Enable RTA to better understand:
- Its ridership, and
- The relationship that exists between changes in fares, fare structure, fare collection, ridership, and revenue.
- Develop a recommended strategy for RTA’s future fare structure and fare collection system, including guidelines for tintegrating the future fare structure with the Authority's redesigned service system.
- Develop tools for the Authority to use in analyzing future fare changes
To begin the analysis of the current fare structure, LTK administered an on-board survey of current customers. The survey’s primary objective was to understand how customers use the system to pay their fare. In total nearly 3,000 customers participated in this initial survey.
Key Survey Findings
- Over 65% of trips are taken by riders travelling on the system more than 5 days per week.
- About 90% of trips are taken by riders making at least two, one-way trips, each day they use RTA.
- About half of all one-way trips on RTA require a transfer between RTA vehicles.
- Most riders are traveling to work.
- About 75% of riders did not have a car available to use instead of RTA.
On Tuesday, August 6th, LTK Engineering Services shared an interim report to the Board of Trustees at the External and Stakeholder Committee Meeting. This brief summary of the project included an initial draft of recommendations. The next step in the study’s timeline calls for additional public outreach. Engagement at these meetings will be focused on the community’s perception of fare structure and collection.
|September - December 2018||Survey GCRTA Riders to understand how they use the system and pay fares|
|September 2018 – February 2019||Analyze GCRTA and Peer Systems’ fare structures|
|February – June 2019||Develop tools for analyzing future fare changes|
|May 2019||Public Outreach regarding Fare Policy and Fare Structure|
|August 2019||Develop options for fare strategy elements and potential guidelines|
|September - October 2019||Public Outreach regarding specific options|
|October – November 2019||Develop recommended strategy|
|December 2019||Present recommended strategy to Board of Trustees|
GCRTA’s 33 mile rail network is a $3-4 billion infrastructure asset to the community. GCRTA’s Rail Car Replacement Program is a $240 million program, consisting of replacing 40 Tokyu heavy rail vehicles (HRVs) with 34 HRVs, and replacing 34 Breda light rail vehicles (LRVs) with 24 LRVs, associated infrastructure upgrades to the rail maintenance facility, equipment and stations to accommodate the new rail vehicles, and design, inspection, testing, and force account costs. GCRTA’s current HRV fleet is 34 years old and the LRV fleet is 37 years old, with both fleets exceeding their design lives.
GCRTA contracted with LTK Engineering Services for a Rail Car Evaluation. The study concluded the current HRVs have approximately five years of remaining useful life and the LRVs have approximately ten years of remaining useful life. LTK recommends GCRTA begin procuring HRVs by 2020 for delivery no later than 2023, followed by procuring LRVs by 2025, for delivery no later than 2028. The LTK report, completed on January 25, 2019, provides detail and justification for replacing both sets of rail cars.
GCRTA is proposing a multi-year potential funding program with 50% federal, 25% state, and 25% local sources. In anticipation of the need to replace the rail cars, GCRTA placed $23.3 million in a Rolling Stock Reserve Fund, and plans on adding approximately $5 million per year to the fund for use as local match towards grants for a total of $36 million. GCRTA has also committed $22.9 million of FTA Section 5307 and 5337 formula grant funds for FFY 2020-24 in our 5-year Capital Improvement Program (CIP) and will commit another $25.1 million of Federal Fiscal Year (FFY) 2025-29 formula funds towards the HRV and LRV replacements.
On July 15, 2019, GCRTA submitted a Better Utilizing Investments to Leverage Development (BUILD) grant requesting $25 million for the HRV replacements.
On September 13, 2019, NOACA awarded GCRTA $9.6 million of Surface Transportation Block Grant (STBG) funds for State Fiscal Year (SFY) 2021-24 and has recommended another $14.4 million of STBG funds for SFY 2025-30.
On September 25, 2019, ODOT Transportation Review Advisory Council (TRAC) determined that our request for $60 million was not eligible for their funding program. However, on October 25, 2019 ODOT awarded GCRTA $5 million of Ohio Transit Partnership Program (OTPP) funds for SFY 2020 for the HRV replacements and we anticipate a similar award for SFY 2021.
To date we have been awarded $60.8 million with another $57.2 million committed for a total of $118.0 million of the $240.0 million program.
Updated funding table
|Funding Source||Funding Amount||Awarded||Committed||Uncommitted||Comments|
|GCRTA Rolling Stock Reserve Fund||$36,000,000||$23,300,000||$12,700,000||$0||$23.3 million currently in fund, $12.7 million budgetted in 2020-2022.|
|FTA Section 5307 and 5337 Formula Grant Funds||$48,000,000||$22,900,000||$25,100,000||$0||$22.9 million in 2020-2021 CIP, $25.1 million in future 2025-2029 CIP.|
|FTA Section 5309/USDOT Build Funds||$72,000,000||$0||$0||$72,000,000||$25 million BUILD grant submitted on July 15, 2019. Other grant requests to be submitted in the future.|
|ODOT GRF||$60,000,000||$5,000,000||$5,000,000||$50,000,000||$5 million awarded for SFY 2020 OTPP with similar award expected for SFY 2021 OTPP. TRAC funding application was denied. Working with ODOT for additional funding opportunities for future years.|
|NOACA STBG||$24,000,000||$9,600,000||$14,400,000||$0||$9.6 million awarded for 2021-2024 Transportation Improvement Program (TIP) and $14.4 million recommended for 2025-2030 plan. Approved on September 13, 2019.|
In 2018 RTA contracted with LTK Engineering Services to perform a comprehensive evaluation for GCRTA’s Heavy Rail (HRV) (Red Line) & Light Rail (LRV) (Blue, Green and Waterfront Line) rail car fleets.
Both fleets have had some level of mid-life rehabilitation, but are now exceeding the accepted 30 year useful life for rail cars in their respective categories.
The scope of work was to determine the estimated remaining life of each fleet, and evaluate the benefits of a major rehabilitation vs. rail car replacement.
Heavy Rail Car Assessment Results
Estimated HRV Remaining Life: 5 years
Recommendation: Replace Fleet vs. Rehabilitate
Rationale for Replacement:
- Structural loss from corrosion
- Lack of readily available spare parts
- Cost of rehabilitation far exceeds replacement cost
Projected Procurement Schedule: Start in 2020 with delivery in 2023
Recommended Fleet Size: 34 (reduction due to greater reliability and fewer maintenance requirements)
Projected Vehicle Budget: $102,000,000 (34 HRVs @ $3 million/vehicle)
Light Rail Vehicle Assessment Results
Estimated LRV Remaining Life: 10 years
Recommendation: Replace Fleet vs. Rehabilitate
Rationale for Replacement:
- Structural loss from corrosion
- Lack of readily available spare parts
- Cost of rehabilitation far exceeds replacement cost
Projected Procurement Schedule: Start in 2025 with delivery in 2028
Recommended Fleet Size: 24 (reduction due to greater reliability and fewer maintenance requirements)
Projected Vehicle Budget: $96,000,000 (24 LRVs @ $4 million/vehicle)
Final Recommendations – Budget and Procurement
Projected Budget: $240 million (includes: vehicles, rail shop infrastructure improvements as well as contingency)
LTK recommends the procurement of two different fleets (HRV and LRV) rather than a single, common car to serve both High and Low platforms. A single, common car fleet would require significant infrastructure work at rail stations as well as eliminate the ability to phase in vehicle purchase and delivery.
Finally, LTK recommends if possible, RTA attempt to procure the new fleets with available option on an existing contract, which would save RTA time and money by reducing up-front engineering and development costs.
WSP was tasked by the Greater Cleveland Partnership (GCP) to complete the financial analysis and economic forecast to answer six broad research questions:
- How does RTA compare to its peers?
- What are the economic and market risks RTA faces?
- What are the financial issues RTA faces?
- What potential efficiencies could increase financial performance, and what strategies could maximize revenue?
- What are current Key Performance Indicators and what processes and/or other indicators can be implemented?
- What are current and potential future local funding mechanisms for transit?
The table below presents the study’s key findings on each research question and a rating of RTA's relative performance.
|Research Question||Key Findings||Rating|
|Benchmarking||On par with peers, except for administrative and paratrtansit costs; rail service volume is high compared to ridership||Medium|
|Economic and Market Risks||Future of rapid transit in Cuyahoga County is tied to regional planning and economic development||Medium|
|Operational budget appears to be balanced based on RTA assumptions||Excellent|
|Significant funding gaps for rail car and rail infrastructure replacement||Low|
|Cost Efficiencies and Revenue Opportunities||Up to $21 million in savings and $8 million in additional revenues can be achieved by implementing recommendations.||Medium|
|Key Performance Indicators||Strong KPI system, but need to improve public transparency and internal communications||Medium|
|Revenue Options to Bridge Funding Gaps||RTA is authorized to levy sales-and-use and property taxes at the county level; both have a large base and could bridge capital funding gaps.||Medium|
Conclusions and Recommendations
The following recommendations emerged from the study:
- Benchmarking: RTA’s operational performance offers a mixed picture, with high-performing services (Bus Rapid Transit: the HealthLine) countered by services that are not performing in line with peers with respect to cost (local bus) or ridership (rail services). Additionally, administration cost appear to be higher than most peers. From a governance standpoint, RTA’s Board would benefit from limiting terms and eliminating the stipend for Board members.
- Economic and Market Risk: RTA is facing risks related to its funding, its operation, its assets and broad regional trends. Opportunities to mitigate these risks, based on stakeholder input, include new CEO leadership, a recently completed bus system redesign study, and while less certain, the recent growth in downtown population.
- Financial Issues: RTA’s financial outlook shows limited deficits in the operating budget. However, projected cost of procuring a new rail fleet and meeting other unfunded capital needs, primarily related to the rail system, far exceeds available capital reserves.
- Cost Efficiencies and Revenue Enhancement Strategies: Cost reduction strategies, relying on privatization and internal reorganization, could lead to a potential cost savings of $21 million a year, while additional revenue could amount to $8 million through ridership recovery with local bus redesign and reinvestment in the rail system. To support its rail infrastructure, the region should consider as a priority, long-term coordination of RTA’s service development and capital investments with governmental, business and non-profit entities to direct economic development toward rail station areas, which are currently under-utilized.
- Key Performance Indicators: RTA has successfully developed advanced performance reporting systems. To enhance its performance-based management, reputation and transparency, RTA should share its goals and results both internally with all its employees and externally with its riders and the public.
- Revenue Sources and Options to Bridge Funding Gaps: RTA has the ability to levy sales-and-use and property taxes at the county level. Based on RTA’s assessment of its capital needs, substantial funding increases are need to recapitalize its rail infrastructure and replace its rail fleet. What is uncertain is if that increased funding to cover the capital shortfall will yield a high return-on-investment in terms of increased ridership.
The full GCP Report, as prepared by WSP, is available here.