EDC grounds its buses; BlueGo sputters to stay viable
By Kathryn Reed
El Dorado County pulled its two buses out of the BlueGo fleet Wednesday, creating an unstable situation for on-call riders of the public transit system.
“Because everything happened late (Tuesday) I’m not sure about the on-call services or what is being offered to those folks,” county Supervisor Norma Santiago told Lake Tahoe News late Wednesday. Until July 22 she was the vice president of the South Tahoe Area Transportation Authority. She is still on its board. “There are some discussions going on that I’m not privy to.”
(STATA is a nonprofit Nevada-based umbrella agency that runs the transit system on the South Shore.)
No one is riding El Dorado County-owned BlueGo buses. Photo/Kathryn Reed
On Wednesday afternoon one of the two buses was in the county’s transportation yard in Meyers. Just after 5pm a BlueGo bus was in service in the Meyers area headed toward South Lake Tahoe on Highway 50.
The directive to park the vehicles came about because of liability issues involving the county not being named on the certificate of insurance, Santiago said.
Two closed session items involving BlueGo were on the Board of Supervisors’ July 27 agenda, though no reportable action was taken. These pertained to lawsuits.
Eleven days ago the set route in Meyers was eliminated along with other changes in an attempt to put a Band-Aid on the ailing system.
Lake Tahoe News called BlueGo dispatch Wednesday asking about booking a ride for this morning for on-call service in Meyers. The dispatcher said it was possible, but there was limited availability.
Financial concerns
“Right now the county has no agreement with STATA,” Santiago said.
On June 29, she made a motion as chairwoman of the Board of Supervisors to not fund an estimated $181,343 for July 1, 2010, through June 30, 2012, to provide for the operation and funding of BlueGo on-call services. The board agreed.
Stacy Dingman, a STATA board member and spokeswoman for the group, told Lake Tahoe News this week she knew nothing of El Dorado County’s June vote even though the STATA board last met July 22.
Things are so bad at the Stateline agency that the B word – bankruptcy – has been broached.
“There have definitely been rumors about bankruptcy. The fiscal year began July 1. That is when new grants come in. Monies are coming in,” Dingman said.
Mike McLaughin, attorney for STATA, said, “The board is considering all of their available options and it would be imprudent not to consider bankruptcy as an option. Settling the debt with MV is an option and other options are available.”
State and federal dollars, which is what STATA relies on to keep the buses rolling, have strings attached. A basic requirement is to have annual audits and a semblance of financial stability.
STATA has neither. The audit for fiscal year ending June 30, 2009, is not done. And its financial solvency resembles scarlet red more than midnight black.
In an email from STATA accountant Rhonda Saigh to Dingman, which Dingman shared with LTN, it says, “The 08-09 audited financial statements have not yet been accepted by the board. That action is expected to be taken at the board meeting on Aug. 9. No public distribution or posting is appropriate prior to board acceptance. The audited financial statements are not required, but desired, to be posted on the website. To refresh your memory, the completion of the 08-09 audit was vastly delayed primarily because of the very, very late grant billings to NDOT. “
The Nevada Department of Transportation is so worried about STATA’s ability to operate that it sent STATA Chairwoman Nancy McDermid and Treasurer Dan Garrison an email July 12 saying it was threatening to cut off funding.
The letter from Derek Kirkland, transportation planner, says, “The biggest concern is that STATA is lacking cash flow and is relying solely on grant funding, which is not allowed. NDOT’s grant funding is a reimbursable program and requires a 50 percent local match,” Kirkland wrote. Later the letter says, “As I know you are very aware, STATA is in a very serious situation and risks shutting down service indefinitely.”
Federal law mandates annual, timely audits be done in order to receive funding.
One of the issues for El Dorado County is the 2009 audit is not approved, when in fact it’s the 2010 audit that should be under way. Audits are due to California by Dec. 31 each year.
“STATA has a contractual obligation to the county to provide us with an audited financial statement,” county Auditor-Controller Joe Harn said. “(It’s) unfortunate the audit was not completed sooner. It might have provided insight to the board of directors of STATA and to the county of El Dorado about what was happening financially to STATA.”
Because STATA is a Nevada corporation it does not have to meet some of the stricter rules California has on the books. John Andoh, the transit administrator who left STATA earlier this year, did not have to file papers with the Fair Political Practices Commission in relation to MV Transportation – his former employer – who he recommended to the board be the transit operator. If it were a California entity, the contract STATA signed that was valued at more money than it had, would have been null and void.
Looking for answers
Santiago says there is plenty of blame to go around for why STATA is in the quandary it’s in. She admits the board should have asked more questions of Andoh and not relied on this one staff person to be so powerful.
“Hindsight is 20-20. We should have reigned in John a lot sooner,” Santiago said. She said he misrepresented to MV what the board wanted and what STATA was capable of paying.
Andoh at one time tried to get El Dorado dollars passed to a dormant, essentially non-existent JPA called the Basin Transportation System that was established in the 1970s.
McLaughlin does not believe there has been any misappropriation of funds.
“I don’t think anyone has cast any doubt that all the funds in the operation were used for capital acquisition and operations. But the system was set up to run with a certain budget and all those budgeted funds did not come to fruition,” McLaughlin said.
Another lawsuit on the books
On July 27, the fourth lawsuit from MV Transportation, the transit operator for the South Shore system until June 20, was filed. This one in Douglas County names all of the member agencies of the South Tahoe Area Transportation Authority.
The entities named in the latest suit are: South Lake Tahoe, El Dorado County, Douglas County, Harveys, Harrah’s, MontBleu, Horizon, Lakeside, Heavenly, Ridge Tahoe, Tahoe Transportation District, and Tahoe Regional Planning Agency. TRPA is a non-voting member of STATA.
“The lawsuit filed (Tuesday) is pretty extensive. Everyone is scrambling,” Santiago said.
The problem is STATA owes MV more than $2 million, though the sparring entities disagree on exact amount.
Bringing in TTD
To appease NDOT, and probably other funding agencies, STATA at its special July 22 meeting that was a joint board meeting with Tahoe Transportation District, agreed to have this agency handle the day-to-day operation. Transit Resource Center has a limited contract to run the actual vehicles.
NDOT officials were at last week’s meeting. It had been the state agency’s recommendation in the July 12 letter that TTD be brought in.
TTD will do this through Sept. 30. This agency, which has two staff members, is tasked with handling grant proposals and administering the request for proposal to find a long-term bus operator for STATA.
It’s possible a longer contract could be issued or that TTD would take over the bus system and STATA would be dissolved. One thing that needs to be overcome is the TTD board is made up of public agencies, while STATA is a public-private enterprise.
Santiago envisions it being a rough road going forward for everyone involved.
“I think everybody is committed to making sure the BlueGo system continues to operate. It may operate on a smaller scale,” McLaughlin said. He said talks have centered on having a transit system where the operations fit the confirmed dollars coming in. “The system might get a bit smaller. I don’t think anyone anticipates the system going away.”
Virtually every time that government is in charge of something, one can expect inept results, at high cost, with massive taxpayer subsidy. The bus system is obviously no exception.
Is our area big enough to support any public transportation? Do we have enough daily ridership to justify a the full route structure?
Is the fare structure designed to support the operation or how much is the taxpayer being charged?
On call service is a duplicate and competitor of the taxi. How much does it cost to run this separate service and should we just let the taxis do what they are licensed to do while paying taxes?
Virtually every time that TRPA is in involved, one can expect inept results, at high cost, with massive taxpayer subsidy. The bus system is no exception. As was said before when ATM was sent on it’s way the whole system has gone to POT.
A taxi ride from the Y to Stateline is $40.00 round trip. The bus is $12.00. How do you afford $40 per day to get to and from work? If the bus system were more reliable and we got less government involvement and more private business sense, it could be self-sustaining. Yes, we NEED a bus system here for many of our locals who have no other way to get to and from work.
Amazing…again, why am I not surprised that this happened? Norma Santiago along with the Board of Directors need to take accountability as well for the dire situation that STATA is in. Why would the former Transit Administrator have misepresented to MV what the Board wanted? MV was in on the meetings with the Board as well as the committees that were established by the Board. The Board did not pay attention to the finances until it was too late. They did not allow the hiring of an accountant until August 09. I was a planner hired to take responsbility of a $5.8 million dollar transit system. The Board should have took my advice and hired an executive director back in August and not rely on a planner to manage the affairs of a disfunctional agency.
As non-profit corporation, the Transit Administrator was advised by Michael McLaughlin, Legal Counsel that the Transit Administrator should not file with the Fair Political Practices Commission since we were not a public agency. I tried to file, as well as encourge the Board to file also in 2009. Again, the Transit Adminstrator was not an executive. The Transit Administrator was a planner position hired under TRPA and assigned to STATA.
It should be noted that the Transit Adminsitrator did not recommend MV. The Board of Directors selected MV through a competitive process after reviewing bids from First Transit, MV and Silverado Stages in April 2009. Stacy Dingman, Rick Angelocci, Allen Coleman, Anna Hastie among others sat on a panel on scored these proposals. The Transit Administrator did not participate in the scoring. The evaluation committee recommended MV which went to the Board in June 2009 and again in August 2009. In the interim contract selection, again, a committee created by the Board selected MV over First Transit and El Camino Trailways in October 2008. The Transit Adminsitrator did not participate in the scoring of the proposals either. Please view minutes and staff reports from November 2008, June 2009 and August 2009 for more details on the selection of MV at http://www.bluego.org/board.aspx
I believe that further research is needed prior to writing these stories. If questions arise, a simple call or email should work.
Maybe STATA is on the right course finally by using TTD for its management. They should have went this direction after eliminated the Transit Administrator position instead of hiring consultants that were instrimental in causing the MV contract to be abuptly terminated.
Transit should not be this screwed up. However it appears all of this nonsense goes back to the lack of oversight by the City of South Lake Tahoe, El Dorado County, Douglas County and Heavenly of their contracts with ATM prior to hiring a planner through TRPA. Amazing.
tahoeadvocate
Farebox revenue is about 10 to 15% if I remember correctly.
Your reputation is inconsequential to getting a good transportation system for the public, Andoh. Blaming others is not conducive to finding a good system either. You were the administrator and if you felt you weren’t qualified you shouldn’t have accepted the job. Once accepted, you are equally responsible everyone plays a part.
Now is time to get everyone together and provide us decent inexpensive good transportation. Stop the fighting blaming and suing lets get this done.