PORT ANGELES — Clallam Transit board members have approved a six-year transit development plan for 2020-25 that reflects funding uncertainties related to the COVID-19 pandemic and the status of Initiative 976.
The unanimous vote was taken at the monthly meeting on Wednesday.
The rolling plan is required by state law to annually demonstrate how the agency will meet state and local long-range priorities for public transportation, capital improvements and significant operating changes planned for the system as well as detail how program needs will be funded.
Board members also heard departmental reports, including securing $3 million in grant funding that will be used to purchase new coaches for shuttle service in Sequim and Forks, approved a lease agreement extension for the Sequim Transit Center with the city of Sequim, and they went into executive session to discuss its annual performance review of Clallam Transit general manager Kevin Gallacci.
No public comment was received prior to the board’s vote to adopt the development plan.
“There are uncertainties with how 976 has impacted us and the other funding sources we do receive,” Gallacci said, referencing a voter-approved 2019 initiative that would significantly cut the state’s transportation budget.
After a number of legal challenges, the state Supreme Court will decide whether to implement the initiative.
Gallacci said the agency has received a total of $4.4 million in funding in two installments from the federal Coronavirus Aid, Relief and Economic Security (CARES) Act.
“Cares Act funding is keeping us whole and providing funding as an essential workforce to keep transit running at the level it is right now,” Gallacci said in an interview following the meeting.
“This funding is short-term support to see us through the crisis. I don’t see federal funding staying at this level, but I see the potential for more operating funding from the federal government in the future. The biggest unknown and the biggest impact is 976 for funds that Transit uses and depends on.”
Board Chair Lindsey Schromen-Wawrin, who is also a Port Angeles City Council member, expressed concerns upon seeing rising expenses and a drawdown of Transit reserves in the final years of the plan.
Clallam Transit finance manager Dunyele Mason clarified the financial forecast.
“Our six-year forecast is showing and assuming that our sales tax is being impacted by COVID,” Mason said.
“If you look across the six years, you will see that it has dropped back to the prior year, 2019, and dovetails with the assumptions used by the CARES Act funding. Sales tax is an unknown.
“The reason there is a big drop-off in 2023 is because the CARES Act money is gone, and we don’t know what is happening with sales tax. Sales tax revenues came in higher than ever last month, so it’s hard to predict what is going to happen with it.”
Gallacci didn’t have specific information for Clallam County but mentioned a delay in reporting or paying sales tax statewide.
“It may represent a lag in reporting to the state Department of Revenue or pent-up consumer demand after quarantine,” Gallacci said.
He said the agency will need to be flexible in developing future funding sources and cautious with large capital expenses.
“We are in really good financial shape, and capital is at a great level right now,” Gallacci said. “I am concerned about next year, the budget we are putting together and potential funding shortfalls if they do happen.
“We could extend our capital replacement program and defer projects. It could come down to reducing service or some efficiencies in staffing. We could receive more funding to support rural transit systems from the state and federal government.
“And we do have the option to ask the board to approve a ballot measure for a sales tax increase of one-tenth to three-tenths of a cent. But we have lots of options to think through before that time,” he said.
“We’ve bumped out the electric [vehicle infrastructure] a little further, trying to be cautious of getting ourselves to commit to any large projects due to cost and what new technologies could be available.
“Basically, we want to plan for the worst and hope for the best while keeping as much service on the road in the future.”
Sports reporter Michael Carman can be contacted at 360-406-0674 or at [email protected].