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Analysis of Operating Revenue Enhancement Opportunities for Miami-Dade Transit

Analysis of Operating Revenue Enhancement Opportunities for Miami-Dade Transit. Miami-Dade Citizens’ Independent Transportation Trust November 2010. A Report by Infrastructure Management Group & Planning and Economics Group. Operating Revenue Enhancement Opportunities: Project Overview.

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Analysis of Operating Revenue Enhancement Opportunities for Miami-Dade Transit

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  1. Analysis of Operating Revenue Enhancement Opportunities for Miami-Dade Transit Miami-Dade Citizens’ Independent Transportation Trust November 2010 A Report by Infrastructure Management Group & Planning and Economics Group

  2. Operating Revenue Enhancement Opportunities: Project Overview • The IMG Team was tasked by CITT to identify and evaluate the full spectrum of alternatives for increasing operating revenues to the County’s mass transit system and to close the substantial gap projected in 2014 in the MDT Pro Forma. • By reviewing how transit properties in the U.S. and internationally fund their operations, the IMG Team has prepared a “menu” of potential revenue techniques for the County to consider. • This “menu” will give the County a full understanding of how to leverage the half percent sales tax revenues to produce the maximum benefit for the County’s mass transit systems. • This builds on the team’s prior work analyzing methods to fund capital expansion, delivered in 2009.

  3. Operating Revenue Enhancement Opportunities: Methodology The IMG team methodology for this revenue enhancement task consists of the following steps: • Research national and international potential revenue techniques: Research studies and reports detailing potential revenue at transit properties in the U.S. and worldwide. • Summarize the spectrum and use of potential revenue techniques: Develop an annotated bibliography to summarize the results of this literature review. Develop a list of techniques and of leading transit properties implementing them. • Gain perspective from Miami-Dade: Meeting with County officials and staff to discuss revenue enhancement efforts implemented and considered for MDT. • Provide best practice, innovative knowledge from industry leaders on potential revenue techniques: Interview selected properties and organizations across the U.S. of various sizes and types, representing a broad spectrum of techniques. • Report comprehensively of industry knowledge on potential revenue techniques: Provide a comprehensive menu of revenue options.

  4. Operating Revenue Enhancement Opportunities: Report Structure and Discussion of Revenue Techniques

  5. Operating Revenue Enhancement Opportunities: Report Conclusions The avenues for generating transit operating revenue are fairly well defined (generally sales and property taxes), and there is no single solution. While important to maximize, system revenue sources alone have limited potential to fill the entire projected budget gap. Advertising, parking, and concessions represent limited revenue enhancement opportunities. U.S. cities employ a wide mix of taxes and fees to close budget gaps, including creatively using revenue sources associated and not typically associated with transit such as utility fees and “sin” taxes. Value capture tools are among the most powerful non-tax revenue sources including direct taxes on business and development through impact fees, special assessment districts, or payroll taxes have the greatest revenue potential. Tolling is a key potential new source for revenue with the Miami-Dade Expressway Authority (MDX) planning to expand, and the implementation of toll lanes on I-95 in the County.

  6. Operating Revenue Enhancement Opportunities: Report Conclusions (continued) 6. MDT does have a number of immediate enhancements MDT can quickly undertake to increase revenue, such as the following: Aggressively pursue advertising solutions, such as bus and train wraps, domination advertising, and variable signage. Reconsider selling naming rights for Metrorail and Metromover stations by revisiting the contracting options and developing partnerships. Capitalize on MDT’s right-of-way in highly-trafficked where advertising, billboards, and joint development opportunities are available. Stay abreast of technology solutions that are at the cutting edge of transit partnerships –Wi-Fi, GPS-based advertising, social media, etc. International transit agencies view transit as a federal responsibility and are more likely to contract out operations. Focusing upon revenues is only one side of the ledger.  A complete view would also focus on operating expenses.

  7. Operating Revenue Enhancement Opportunities: System Based Revenue

  8. Operating Revenue Enhancement Opportunities: Non-System Based Revenue

  9. Operating Revenue Enhancement Opportunities: Techniques by Prevalence

  10. Operating Revenue Enhancement Opportunities: Key MDT Opportunities and Issues

  11. Operating Revenue Enhancement Opportunities: Transit Surtax Provides Far Less Revenue Than Other Systems *Sales taxes are used for operations and capital costs. Comparison to operating budget is to show magnitude of collections.

  12. Operating Revenue Enhancement Opportunities: Next Steps • Receive input from CITT, County staff, and other stakeholders. • Incorporate comments and finalize report. • Present to full CITT November 30, and, potentially Transit, Infrastructure and Roads Committee (TIRC). • Policymakers determine course of action to implement revenue enhancements. Picture Credit: King Kong Bus Wrap by Advertising Agency: Bates Y&R, in Copenhagen, Denmark

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