Sunday, July 14, 2024

Wave needs $750K to balance budget, board considers recommended route changes

Wave Transit needs $750,000 to balance its upcoming budget to continue operations as normal. (Port City Daily/Amy Passaretti Willis)

WILMINGTON — Without hundreds of thousands more in funding, the Cape Fear Public Transportation Authority will be operating in a deficit, resulting in potential cuts to service.

READ MORE: ‘Everything is on the table’: Wave strategizes for 5-year short-range plan

At a special meeting on Wednesday, the CFPTA board of directors reviewed recommendations for its next short-range plan for the Wave system, which includes 12 bus routes and a micro transit program. 

During the discussion, CFPTA Executive Director Mark Hairr — newly hired in September — said the authority is facing a $750,000 deficit in fiscal year 2025 if funding remains the same. 

Board member and New Hanover County Chief Financial Officer Eric Credle explained the authority can get through the upcoming fiscal year by using reserve funds, but doing so would deplete them by the next fiscal year. After that, he said the board was looking at a $2.8 million deficit in FY26.

Wave’s financial struggles aren’t new. Starting in 2016, the authority began failing to reach its goals for revenues brought in by rider fares while at the same time requesting additional funding from local governments. In late 2019, then-NHC commissioner Julia Olson-Boseman brought forward a surprise to withdraw its funding from Wave

Following that, both the city and county leadership approved a resolution to “restructure” the regional public transit system, including gutting the entire board and firing the executive director. At the time, Wave Transit was requesting a $700,000 loan to prevent the suspension of services. 

A new board was appointed in 2020, made up of mainly county and city officials, and a new director was hired. In 2021, the board put in place a long-term solution for sustainable funding with a goal of reaching financial independence by 2028.

Voters turned down a quarter-cent transit tax in 2022 that would have provided $65 million to Wave over 10 years.

Currently, Wave operates on a roughly $11.7-million budget — slightly higher than FY23’s $11.6-million allocation — and is receiving an additional $770,000 over the next four years from the Bipartisan Infrastructure Law.

CFPTA receives the bulk of its funding from the federal government, but subsidies have remained stagnant or declined as costs have risen. Around $12 million in Covid-19 relief funds are also being phased out. The authority receives state and local funding, the latter from the City of Wilmington and New Hanover County, which combined make up 20% of the budget.

City of Wilmington manager Tony Caudle questioned what would happen if the board could not secure enough funding to cover the deficit; Hairr said the system would have no choice but to reduce services.

The board was presented with a hypothetical of how it would look based on suggestions from consultant Nelson\Nygaard. Senior Associate Keaton Wetzel outlined the firm’s alternative route proposals based on three scenarios: a 30% reduction in budget — which will occur if the board cannot secure the needed $750,000 — a revenue neutral budget, and a 30% increase in budget. 

Wetzel’s revenue reduction scenario would be “detrimental to most riders,” though the company could mitigate some losses with a few proposals. Wave would have to combine some routes, already being proposed in the other scenarios for efficiency, and Nelson\Nygaard would suggest discontinuing the downtown trolley due to lower ridership. 

There would not, however, be a loss in coverage of current routes. However, frequency would decrease; Wetzel said only the College Road, Southside, downtown and medical district residents would be able to access buses that run every 30 minutes.

Wetzel added the industry standard for “frequent” service would be every 15 minutes, and evidence shows a transportation system is more effective with increased frequency as opposed to more routes over a wider coverage of a municipality.

Board chair and New Hanover County Manager Chris Coudriet and City of Wilmington Manager Tony Caudle said only the elected officials they represent could make a decision to increase funding. Both indicated support for increasing frequency in the Wave system.

“I don’t think anyone wants to see the system contract,” Coudriet said at a special meeting held Wednesday.

Coudriet was concerned with “level-setting” in the short term, while shooting for the proposals outlined in a 30% budget increase. 

Wetzel said there was broad consensus among its surveyed population that more frequency is needed along Market Street, Carolina Beach Road, College Road, Oleander Drive, and between downtown and the medical district. 

Many of the firm’s suggestions focus on improving efficiency along these corridors. For example, route 108 that runs along Market Street would become more simplified. Under a budget neutral situation, this route is proposed for every 30 minutes, six days a week; with an increase, this could be a 15-minute frequency. Another proposal is synchronizing routes 205 and 2010 to offer a bus from downtown to the medical district every 15 minutes. 

Some tradeoffs with these adjustments would be slightly longer walks to the bus stop for some riders, though this would be confined to the more walkable urban core of Wilmington.

Nelson\Nygaard also proposed to adapt the downtown trolley to only stop at major downtown destinations aimed at accommodating tourists. Currently, it runs through the Brooklyn Arts, Central Business, Castle Street and South Front districts. Though the firm proposed operating at a 30-minute frequency, expanding to Sunday service, and having later end times, the tradeoff is earlier start times and seasonal operation from March to November.

Wetzel pointed out the route, as is, sees long stretches of no ridership during the day with very long transfer times on most trips. Those things make it more suitable for visitors.

The low-ridership routes — east Market Street and Eastwood Road — have little-to-no boardings, according to Wetzel. He said these customers cost three times as much as other passengers in the system because of the low boardings. He recommends it become RideMICRO routes instead.

RideMICRO, a point-to-point service akin to ride-share apps, is more expensive by nature due to its low passenger service per trip. Because of this, Wetzel recommends eliminating the program in areas where the bus routes are popular, such as those centered in downtown. 

“You don’t want to compete and undercut the ability of your bus routes,” Wetzel said. 

No formal vote on the plan was taken on Wednesday, though the City of Wilmington and New Hanover County are already in budget planning mode. When adopted, the Wave short-term plan will cover 2024 to 2028.

[Editor’s Note: A previous version of this article identified Eric Credle as CFO for the City of Wilmington. He is now correctly identified as CFO for New Hanover County. PCD regrets the error.]


Reach journalist Brenna Flanagan at brenna@localdailymedia.com.

Want to read more from PCD? Subscribe now and then sign up for our newsletter, Wilmington Wire, and get the headlines delivered to your inbox every morning.

Related Articles