Title
Staff Report for Resolution Accepting the Annual Report of the West San Leandro Shuttle Business Improvement District (BID) for Fiscal Year 2015-16 and Directing the City Manager to Impose the BID Assessment Rates Increased by the Consumer Price Index (CPI)
Staffreport
RECOMMENDATIONS
Staff recommends that the City Council adopt the Resolution accepting the Annual Report of the West San Leandro Shuttle Business Improvement District (BID) for Fiscal Year 2015-16 and direct the City Manager to impose the BID assessment at the increased rates, as recommended by the BID Advisory Board.
BACKGROUND
Business Improvement District and Annual Report
In December 2014, the City Council approved Ordinance No. 2014-023 expanding the BID service area and re-establishing the West San Leandro Business Improvement District (BID) for a period of 15-years. BID fees are collected through the City’s business license process.
The ordinance defines the boundaries of the BID, the amount of the annual assessment, the approved use of the assessment funds, and the effective period of the assessment. The Ordinance requires that an Advisory Board annually review the performance of LINKS for submission to the City Council. In addition, the Ordinance provides that the City Council may increase the annual assessment in an amount not to exceed the increase of the Consumer Price Index (San Francisco, Oakland, San Jose), as part of its review of the annual report.
The five to seven member Advisory Board includes the City’s Engineering and Transportation Director and the Director of Finance (or their designees). The business members appointed to the Advisory Board are Dora Wong of Coca Cola Bottling Company, Kristin Anderson, Eric F. Anderson, Inc., Alexandra Vasquez, Peterson Companies, Mike Adelson, Mr. Plastics and Steve Magidson, Docustream. The Advisory Board’s duties include review of the LINKS performance and budget, and a recommendation for the BID assessment rate. On December 3, 2015 the Advisory Board met to complete the annual review of the LINKS Shuttle. The FY 2015-16 Annual Report is attached to the Resolution for your information.
Analysis
The Annual Report includes a review of the LINKS performance, planned operations, and financials for FY 2014-15 and a recommendation for the FY 2015-16 BID assessment. Following is a summary of the Annual Report.
Service Enhancements
The BID renewal process which occurred in Fall 2014 provided an opportunity to consider service improvements. After outreach to businesses and in-depth work with transportation experts, in March 2015, the LINKS route was divided into two loops and expanded. Two shuttle buses were added to the service resulting in a total of four buses, two on each loop. LINKS continues to provide free shuttle transportation from the Downtown San Leandro BART station to the industrial area west of I-880 and Marina Blvd. The service operates Monday - Friday during peak commute hours (5:45 - 9:45 am and 3:00 - 7:00 pm). The new north and south loops reduce headways to 15-20 minutes, provide more frequent service and reduce the round trip travel time to about 30 minutes.
LINKS provides “first and last mile” connection between transit and employers in West San Leandro, serving major employers including Coca Cola Bottling Company, Federal Express, Walmart, and Costco, as well as small employers. There are over 600 employers and almost 17,000 employees in the LINKS service area. LINKS also provides transportation to retail centers and the Davis Street Family Resource Center, which services 10,000 low-income people each year.
In FY 2014-15, the San Leandro Transportation Management Organization (SLTMO) launched a new marketing campaign including a new logo, brochure, shuttle stop signs and website. The new website (www.sanleandrolinks.com) provides easy access to service information. Riders quickly began using the contact function on the website to provide helpful feedback. The website can be updated in-house allowing timely updates and better service to riders.
Participation in the BID helps businesses comply with the new Bay Area Air Quality Management District (BAAQMD) Commuter Benefits program. In 2014, the BAAQMD implemented a new Commuter Benefits Program that requires all employers with 50 or more full-time employees to provide commuter benefits to their employees. To comply with the Program, employers must select one (or more) of four commuter benefit options and register with BAAQMD. Participation in the LINKS BID satisfies Option 3 (“Employer Provided Transit”) under the new requirements, allowing businesses to save time and money.
LINKS Shuttle Ridership
The updated LINKS service started in mid-March 2015. Ridership for the “old” LINKS service (July - March), averaged 14,435 rides per month with an average of 674 rides per day. Ridership for the new service (April - June 2015) averaged 16,329 rides per month and 742 rides per day. It is anticipated that LINKS will eventually serve 1,000 riders per day.
Over the last year, LINKS experienced ongoing impacts related to prolonged and extensive construction along the LINKS route. Construction impacts combined with the new service changes impacted on-time performance throughout the year. LINKS riders have persevered through the new service hiccups and construction delays.
Budget
Funding for LINKS comes from the BID, grants, the City of San Leandro, partnerships and advertising. The BID funds approximately one-half of the LINKS service. Over 30% of the budget is funded by grants. In 2015, the SLTMO was awarded a two-year Lifeline Cycle 3 grant totaling $370,000. Two major grant applications are pending, including a two-year Transportation Fund for Clean Air (TFCA) grant totaling $74,000 and an Alameda County Transportation Commission Measure BB application that could provide up to one million dollars ($1,000,000) over the next five (5) years. The City of San Leandro contributed $75,000 in FY 2014-15 to the operation of LINKS.
An agreement with Kaiser Permanente to run the Kaiser Shuttle and Transit Demand Management (TDM) program for the new Kaiser Permanente San Leandro Medical Center continues to provide additional funding to the SLTMO. In an effort to further diversify funding, in early 2015 the SLTMO entered into an agreement with Marina Square to advertise on the LINKS buses.
The SLTMO continues to pursue a variety of grant funding. However, grant funding is unpredictable. For example, the current Lifeline Cycle 3 grant will expire in two years. LINKS is not eligible to apply for Cycle 4 funds because the funding priority has been diverted to large fixed route providers. In addition, grant reimbursements can only be drawn as a percentage of the total expense for the reporting period. The reimbursement process creates a cash flow problem making it necessary to have a strong reserve balance at all times.
BID Recommendation
Proactive measures taken to generate new revenue and secure grants have helped to stabilize funding for LINKS. The cash flow gap resulting from the grant reimbursement process will continue to pose a challenge for LINKS. In order to ensure that funding for LINKS stays current with operating costs, it is recommended that the BID rate be adjusted by the Consumer Price Index.
Per the approved Ordinance, the BID may be increased annually by the Consumer Price Index, San Francisco - San Jose - Oakland, All Urban Consumers. The annual change in CPI from October 2014 to October 2015 is 2.6 percent. This results in the BID per owner/employee rate increasing from $21.00 to $21.55. Businesses with three (3) or fewer owner/employees, landlords, and non-profits will continue to be exempt from the BID assessment.
After reviewing the Annual Report, the BID Advisory Board made the following recommendations:
1. BID Rate - Increase the BID per owner/employee assessment rate by 2.6 percent, the annual change in Consumer Price Index (CPI) as provided for in Ordinance No. 2014-023. Businesses with three (3) or fewer owner/employees, landlords, and non-profits will continue to be exempt from the BID assessment.
2. LINKS Service - Continue to work with the transportation provider to address service issues, maintain on-time performance and enhance the LINKS rider experience.
3. Outreach - Outreach to employers and employees to educate and promote LINKS ridership.
4. Kaiser Contract - Refine and enhance the Transit Demand Management (TDM) and shuttle services provided to Kaiser Permanente.
5. Grants - Aggressively seek grant and other funding opportunities.
6. Rider Survey - Conduct a new rider survey to better understand rider needs, meet grant requirements and guide program planning.
7. Shuttle Improvements - As funding becomes available, the SLTMO is committed to aggressively pursuing technology upgrades such as onboard Wi-Fi and Global Positioning System (GPS) and a related smart-phone application to help riders track the shuttles.
Current Agency Policies
• Ordinance No. 2004-013, adopted June 21, 2004, amending Title 2 of the San Leandro Municipal Code to add a new Chapter 15 establishing the West San Leandro Business Improvement District
• Resolution No. 2004-153, adopted October 4, 2004, forming the West San Leandro Shuttle Business Improvement District Advisory Board
• Ordinance No. 2004-021, adopted October 18, 2004, specifying the time and manner of collecting the West San Leandro Shuttle BID assessments
• Resolution No. 2008-130, adopted October 20, 2008, amending Resolution No. 2004-153, modifying the membership of the West San Leandro Shuttle Business Improvement District Advisory Board
• Resolution No. 2009-014, adopted February 2, 2009, approving a Resolution of Intention to re-form the West San Leandro Shuttle Business Improvement District
• Ordinance No. 2009-002, adopted April 6, 2009, amending Title 2 of the San Leandro Municipal Code to add a new Chapter 15 re-establishing the West San Leandro Business Improvement District
• Resolution No. 2010-008 RDA, adopted September 20, 2010, the Redevelopment Agency of the City of San Leandro 2010-2014 Implementation Plan. The West San Leandro-MacArthur Boulevard Project Area identifies the maintenance of LINKS as an Economic Development Priority Program
• Ordinance No. 2014-023 re-establishing the West San Leandro Business Improvement District for a period of fifteen (15) years.
Applicable General Plan Policies
Goal 15.03 of the General Plan specifically encourages the use of shuttle buses as a viable alternative to driving and Action 15.03-A urges continuation of public/private partnerships to provide shuttle services and the pursuit of grant funding opportunities for such activities
ATTACHMENT
Attachment to Resolution
• San Leandro Transportation Management Organization Annual Report
PREPARED BY: Jeff Kay, Business Development Manager, Community Development Department