Panel Recommends New Operator To Run Long Island Bus
Panel Selects Veolia Transportation; Company to Maintain Fares & Routes for 2012
Next Step - Contract Negotiations
Nassau County Executive Edward P. Mangano today announced that the RFP Panel formed in 2010 to evaluate public-private bids to manage and operate Long Island (LI) Bus operations beginning in 2012 has made an official selection. After reviewing proposals submitted by three private transportation operators, the panel, chaired by Nassau County Director of Real Estate Carl Schroeter, selected Veolia Transportation, Inc.
Upon receiving the panel’s selection, the County Executive forwarded it to the outgoing Chief Executive Officer (CEO) of the Rochester Genesee Regional Transportation Authority Mark Aesch, who was retained to review the panel’s selection. Mr. Aesch independently confirmed the panel’s selection and will further assist the County in transitioning to a privately managed and operated bus system. Mr. Aesch is nationally recognized for turning the Rochester Genesee Regional Transportation Authority from a money-losing, under-performing organization into a public sector leader – that has actually reduced reliance on taxpayer dollars. In the coming days, the County Attorney’s Office will negotiate a contract for review by the County Executive. The County Executive will determine whether it will go forward to the Presiding Officer of the County Legislature for appropriate legislative action.
“Because an agreement to continue with the MTA as the operator could not be reached, I will move forward with a public-private partnership in 2012 that maintains bus service without ceding to MTA demands for an additional $26 million from homeowners and employers through the form of higher property taxes,” said County Executive Mangano. “A public-private partnership to operate Long Island Bus makes sense for taxpayers. The steps we take today will protect riders and ensure bus service continues into the future. Residents will enjoy accountability for their tax dollars as the private sector will run bus service more efficiently and effectively and protect residents from real property tax increases.”
The creation of a public-private partnership to operate LI Bus is necessary as the Metropolitan Transportation Authority (MTA) voted on April 27, 2011 to cease all bus service in Nassau County after the end of 2011. In its proposal to provide the County’s fixed route transit and paratransit services, Veolia Transportation, Inc. proposed a first year budget of $106 million, a massive reduction from the current Long Island Bus budget of $141 million.
While the MTA has proposed to eliminate 27 fixed routes, Veolia Transportation, Inc. will maintain all routes for 2012. The County has made it clear to Veolia that route eliminations will only be considered as a last resort and only after consultation with the County and required public hearings. Veolia will study and analyze the current system to determine where efficiencies may be found to reduce the cost of the system, while maintaining and eventually expanding services. In the long term, anticipated revenues will be reinvested in the system to improve services and technology. Veolia also has stated their willingness to expand the County’s paratransit system and find efficiencies to improve service and reduce costs. The company has proposed a management team that consists of Michael H. Setzer serving as CEO of LI Bus. With over 30 years of experience in the transit industry, Mr. Setzer has served as CEO of transit systems in Minneapolis, Cincinnati and St. Louis.
In selecting Veolia Transportation, Inc. to provide the County’s fixed route transit and paratransit services, the Panel noted:
- Clear understanding of the requirements of the Request For Proposal and successful demonstration to the panel of their ability to operate the County’s system;
- Extensive and well-funded organization to support the system, both operationally and financially, even through periods of fiscal uncertainty. Veolia is a large organization and has the ability to absorb revenue shortfalls in the event they occur. In addition, Veolia has the ability to obtain funds to make capital purchases with the expectation that reimbursement will come from state and federal sources;
- Experience in every aspect of operation, including grant management and capital program management;
- Strong proposed management team, which has a great deal of experience in successfully managing systems as large as or larger than the County’s system;
- Price proposal which falls within the range established in the independent cost estimate;
- Detailed response to the panel’s request for additional information regarding fixed route service adjustments; and
Over the coming weeks, Nassau County will negotiate a contract with Veolia Transportation, Inc. to operate Nassau’s bus system. Upon reaching an agreement, the contract will then be forwarded to the Nassau County Legislature for approval.
Who is Veolia Transportation, Inc.?
Veolia Transportation, Inc. is a leader in the transportation industry; multi-national corporation responsible for the management of transit systems throughout the world. In the United States (U.S.) and Canada, Veolia Transportation operates service pursuant to over 200 contracts with 18,000 employees and transports over 400 million people annually. Veolia Transportation’s Transit Division operates some of the largest and most sophisticated bus networks in the U.S. and Canada in cities of all sizes, including Las Vegas, Phoenix, Denver, San Diego, Atlanta, Baltimore, and the suburbs of Washington, D.C. and Toronto. Veolia Transportation, Inc. is a division of Veolia Transport, a company that moves 2.6 billion passengers world-wide annually. Veolia Transportation, Inc. and Veolia Transport are, in turn, subsidiaries of Veolia Environment, a Fortune 200 company and a global leader in water management, waste management, recovery and recycling, energy management, and transportation of people and goods, employing over 320,000 workers worldwide.
What Systems Are Maintained by Veolia and Relevant to Nassau County?
Veolia Transportation, Inc. manages the New Orleans Regional Transit Authority. Veolia took over New Orleans’ fixed route and paratransit system after a short period with another private operator following the devastation of Hurricane Katrina. Since taking over operations, Veolia has reduced operating costs by 20% while significantly increasing the on-time performance of both the fixed route and paratransit systems. Veolia Transportation, Inc. has been able to secure additional funding to expand transit services in New Orleans including a $47 million TIGER grant for the New Orleans streetcar project; they believe they can secure additional funding for the County’s bus system.
The Regional Transportation Commission of Southern Nevada, a mixed fleet with multiple garages, is also maintained by Veolia Transportation, Inc. The company operates this fixed route system in Las Vegas which serves 54 million passengers annually and 17 million revenue miles, as opposed to approximately 14 million revenue miles in Nassau County.
Veolia Transportation, Inc. maintains the Metropolitan Transportation System in San Diego. The company has successfully transformed this former public operation to private management. Veolia also maintains the Regional Public Transit Authority in Arizona. The company successfully completed a turnkey transfer of operations from another operator in only 7 days.
Furthermore, Veolia operates 17 systems that use Compressed Natural Gas (CNG) powered fleets; the largest being the Foothills Transit system in California that operates 302 CNG buses.
MTA: No Way!
In 2010, the MTA demanded that Nassau County increase its subsidy for 2011 from $9 million annually to $26 million annually. County Executive Mangano made it clear that he would not increase property taxes on homeowners and employers to simply fund the MTA’s bloated bureaucracy. Meanwhile, State Senator Charles Fuschillo (R – Merrick) secured the funding necessary to maintain the MTA as the operator of Long Island Bus until December 31, 2011, and provide a smooth transition to a private operator in 2012. Privatizing the operation of LI Bus became necessary as the MTA voted on April 27, 2011 to cease all bus service in Nassau County after the end of 2011.
The truth remains that the MTA is taking $100 million more than ever from Nassau County taxpayers through the job-killing payroll tax. They have applied no credit for this money toward the bus system. Instead, they cut services for the riders, which include people with disabilities and students. In fact, the MTA is consuming Nassau County tax dollars to subsidize New York City’s transportation system.
Newspapers throughout the State have reported time and time again on the areas of waste and concern within the MTA. Examples include:
- increasing property taxes and killing jobs with the payroll tax;
- authorizing 97 percent of Long Island Rail Road workers over age 50 who retired with 20 years of service to receive disability payments – this is three to four times the national average for railroads;
- approving a $350,000 annual salary for its’ Chairman, along with a $500,000 golden parachute should he be fired;
- spending $560 million on overtime (equates to the cost of employing an extra 7,000 people);
- paying 8,074 employees over $100,000 in 2009;
- paying employees when they aren’t even working;
- paying a Long Island Rail Road Repairman $142,857 in overtime in 2009; and
- maintaining two sets of financial books.
Watch the Video