Charm City Circulator running $11.6M deficit (Baltimore: 2014, bankruptcy, elementary school)

[Infinite_heights77]

*Interesting.

Charm City Circulator running $11.6 million deficit - Baltimore Sun

Charm City Circulator running $11.6M deficit


Charm City Circulator Orange photographed on E Pratt Street. (Cassidy Johnson, Baltimore Sun)

By Yvonne Wenger, The Baltimore Sun

Rawlings-Blake said before she considers increasing the parking tax or charging a fare she wants her administration to study ridership trends, wait times and route adjustments.
"I want to find other options; I don't want to charge a fee," the mayor said. "It needs to be a self-sustaining program. I think we can get there without charging a fee."
The circulator launched in January 2010 and was running a deficit almost immediately. By the city's 2012 fiscal year, the circulator cost more than $15 million to run but only had about $6.2 million in revenue. Costs have outpaced revenues every year since.
Henry J. Raymond, Baltimore's finance director, said the city raised the parking tax from 16 to 20 percent over recent years to cover the cost of the circulator, but that wasn't enough to offset other factors contributing to the deficit.
The deficit has been caused in part by ad revenue falling short of projections, the addition of the circulator's Banner Route between the Inner Harbor and Locust Point and the bankruptcy of a fleet vendor that caused unbudgeted vehicle payments.
"Doing nothing is not an option," Raymond said.
An ongoing $130,000 consultant's study is due back by late January, and Rawlings-Blake said any decision about charges to the circulator are expected to be part of her administration's budget next year.
City Council President Bernard C. "Jack" Young called for a hearing, which is likely to be scheduled early next year.

[james777]

That's a lot of money. It might even be more money than the mayor and city council swindled from the taxpayers this year.

[dogpark]

Originally Posted by james777

That's a lot of money. It might even be more money than the mayor and city council swindled from the taxpayers this year.

Nah, I bet city corruption and waste is higher than the Circulator deficit. At least with the Circulator, you can get a bus ride out of it...

[Infinite_heights77]

When people use these words like "self-sustaining", I wonder what they actually mean by this? What does that entail?

[B.K.]

Heard on NPR this morning that SRB is planning on raising the parking lot tax rate again to help shore up the Circulator. How she intends to make this self-sustaining remains a mystery, as this tax is what already subsidizes the Circulator program. Surely not just via the advertising placards on the inside and outside of the buses.

[DubyaM]

There is no such thing as a free lunch. How can there not be a deficit if the rides are free?

[rudy_d]

Originally Posted by DubyaM

There is no such thing as a free lunch. How can there not be a deficit if the rides are free?

Of course the circulator isn't actually free. Most elementary school students could come to that conclusion. A deficit in municipal finance means that expenses exceed the revenues dedicated to it. Because it generates economic activity, the revenue numbers are probably understated since they're not directly attributable to the circulator. But it would be good to have a reliable source of funding.

[GoPhils]

Originally Posted by rudy_d

Of course the circulator isn't actually free. Most elementary school students could come to that conclusion. A deficit in municipal finance means that expenses exceed the revenues dedicated to it. Because it generates economic activity, the revenue numbers are probably understated since they're not directly attributable to the circulator. But it would be good to have a reliable source of funding.

I think you two are in agreement. Did they really expect it to directly create revenue when there are no fares?

[picardlx]

Originally Posted by rudy_d

...Because it generates economic activity, the revenue numbers are probably understated since they're not directly attributable to the circulator.

That's a little too sophisticated of a statement for these forums.