Staff Report #14
August 29, 2018
To All Commissioners
Re: Financial Update – Conventional Transit Services – Operating Budget – July 31, 2018
Recommendation
That the report be NOTED and FILED.
Background
Set out in the table below is the Statement of Operations for Conventional Transit Services for the seven month period ending July 31, 2018. The statement sets out actual to budget performance for the period.
London Transit Commission
Statement of Operations – Conventional Transit Services
Seven Months Ending July 31, 2018
(000’s omitted)
| Description | Actual | Budget | Amount Better (Worse) |
Percent Better (Worse) |
|
| Revenue | |||||
| Transportation | $ 18,161.7 | $ 18,088.8 | $ 72.9 | 0.4 % | |
| Operating | 859.9 | 806.2 | 53.7 | 6.7 % | |
| Transfers from reserves | 622.3 | 455.0 | 167.3 | 36.8 % | |
| Province – provincial gas tax | 4,555.6 | 4,555.6 | – | 0.0 % | |
| City of London | 16,898.1 | 16,898.1 | – | 0.0 % | |
| Total revenue | 41,097.6 | 40,803.7 | 293.9 | 0.7 % | |
| Expenditure | |||||
| Personnel cost | 27,437.3 | 27,330.6 | (106.7) | (0.4)% | |
| Direct bus maintenance | 3,432.4 | 3,449.8 | 17.4 | 0.5 % | |
| Fuel | 4,315.0 | 4,024.1 | (290.9) | (7.2)% | |
| Facility costs | 2,110.6 | 2,137.1 | 26.5 | 1.2 % | |
| Insurance | 1,823.4 | 1,745.0 | (78.4) | (4.5)% | |
| Contribution to reserves | 693.9 | 602.4 | (91.5) | (15.2)% | |
| All other material expense | 1,533.1 | 1,514.7 | (18.4) | (1.2)% | |
| Total expenditure | 41,345.6 | 40,803.7 | (541.9) | (1.3)% | |
| Net favourable/(unfavourable) | $ (248.8) | $ – | $ (248.8) | (0.6)% | |
As indicated, the conventional transit service to-date has a net unfavourable actual to budget performance of $248,800 representing approximately 0.6% of the total budget to-date of $40.8 million.
The major performance issues relate to:
Revenue
- favourable transportation revenue of $72,900 due to higher than budgeted ridership ($214,700) offset by lower average fare ($141,800) (mix of riders different vs. budget);
- favourable operating revenue of $53,700 due to higher than budgeted interest income; and
- an increase in the transfers from reserves of $167,300 utilized to offset the unfavourable insurance expenditures noted below ($99,400) as well as personnel costs related to the return to work program ($67,900).
Expenditures
- unfavourable personnel costs due mainly to higher than budgeted return to work program costs as well as the impact of Bill 148’s paid emergency days;
- unfavourable fuel costs of $290,900 attributed to unfavourable fuel rates ($367,500) offset by favourable fuel consumption ($76,600);
- unfavourable insurance claim costs of $78,400; and
- an increase over budget in contributions to reserves of $91,500 due to increases in interest income (operating revenue).
Ridership
The table below sets out actual to budget ridership performance for the seven months ending July 31, 2018 as well as comparison to the same period in the previous year.
| Description | Actual | Budget | Variance | % Variance | 2017 Actual | % Variance |
| Total Passengers (000’s) | 13,120.8 | 12,966.9 | 153.9 | 1.2 % | 12,772.0 | 2.7 % |
| Average Fare | $ 1.384 | $ 1.395 | $ (0.011) | (0.8)% | $ 1.380 | 0.3 % |
| Revenue Service Hours | 363.2 | 365.7 | (2.4) | (0.7)% | 352.6 | 3.0 % |
| Rides/Rev Service Hour | 36.1 | 35.5 | 0.7 | 1.9 % | 36.2 | (0.3)% |
Administration will continue to monitor the operating budget performance, including ridership, on a monthly basis.
Recommended by:
Mike Gregor, Director of Finance
Concurred in by:
Kelly S. Paleczny, General Manager