TO: AC Transit Board of Directors
FROM: Michael A. Hursh, General Manager
SUBJECT: Cost of Service Trend
BRIEFING ITEM
RECOMMENDED ACTION(S):
Title
Consider receiving a report on the trend of hourly cost of service. [Requested by Director Shaw - 8/11/2021].
Body
STRATEGIC IMPORTANCE:
Goal - Financial Stability and Resiliency
Initiative - Financial Efficiency and Revenue Maximization
Having metrics for service costs allow the District to compare its performance over time and to other agencies.
BUDGETARY/FISCAL IMPACT:
There is no budgetary impact from this report.
BACKGROUND/RATIONALE:
Transit agencies use a selection of cost metrics to measure the performance and efficiency of service. The most common measures look at variations of cost per hour and cost per mile. By looking at costs based on standard units, the measures allow for comparisons over time, and with some consideration, between agencies. In addition, the District uses these measures as a basis for what it charges to other entities for contracted service.
Costs per Hour
Attachment 1 shows the past several years of a selection of cost per hour metrics on the first page, and overall revenues for comparison. Some definitions to go along with the metrics:
* Fully Loaded Cost - all expenses for District-operated bus service divided by hours.
* Marginal Cost - Attempts to measure just the cost of service on the street without administrative burden. Expenses included are: operator labor and fringe (except for new bus operators in training), maintenance labor and fringe, bus parts, diesel, hydrogen, electricity for bus charging, and lubricants. A second marginal cost adds in the cost of service supervision.
* Revenue Hours - all the time a bus is in revenue service including layover and recovery time but excluding deadhead and rest/meal breaks.
* Platform Hours - all the time a bus is outside the yard. Includes revenue hours plus deadhead, and rest/meal breaks.
* Deadhead - the time a bus ...
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