Passenger-Only Ferry Business Plan and Long Range Strategy October 29, 2014 PROJECT TEAM KPFF Consulting Engineers Mike Anderson Kristen Kissinger Scott Davis Art Anderson and Associates Patrick Vasicek IBI Consulting Group Paul Lavallee PRR Kirsten Hauge Kathy Schomer Progressions Carla Sawyer Steer Davies Gleave Pierre Villain Tindale Oliver Elisabeth Schuck Purpose and Background The business plan and long range strategy will be a blue print for implementation of Kitsap based POF service and will include a comprehensive near-term and long-range financial plan. Building a POF Business Plan • What can we learn from past POF service? • What should the governance structure be? • What do potential riders and the community tell us about POF service? • Where are the riders? • What terminal facilities and vessels do we need? • How should we manage and operate the service? • How should we phase implementation? • How much will this cost and how do we pay for it? • What economic benefits will the service bring? WHAT CAN WE LEARN FROM PAST POF SERVICE? Past and Present Ferry Ridership from Kitsap County (1999-2013) WHAT SHOULD THE GOVERNANCE STRUCTURE BE? Governance Findings • Five governance models were evaluated. • PTBA appears to be most applicable governance model: – KT is already qualified as a PTBA – PTBAs authorized to provide POF service – Requires voter approval for funding via MVET or Sales and Use Tax – KT pursuing statute modification to enable establishment of POF Ferry District and collection of parking taxes WHAT DO POTENTIAL RIDERS AND THE COMMUNITY TELL US ABOUT POF SERVICE? Public Involvement Goals • Inform the public and key stakeholders • Seek input to inform the POF business plan • Gauge community interest in POF • Build understanding about POF Stakeholder Interviews: Key Themes Community Opinion • Existing community support for POF • Previous POF service was great and well-used • Concern of cost to benefit ratio Benefits • Connectivity • Economic opportunities and employment • Better quality of life Challenges: • Building regional, political, and leadership support • Limited State and Federal funding opportunities Survey Results (2,204 Respondents) – Highest level of interest was from Seattle/Bremerton riders – Travel time, schedule flexibility and fare were the most important factors – Majority (79%) willing to pay $1 to $3 premium each way on their current fare – While not everyone likes to raise taxes, when asked how much sales tax they would be willing to pay, more than half (58%) are willing to pay a 0.2 to 0.4 of a percent increase in sales tax to fund POF – Arrival /departure times should revolve around commute periods – Preference for additional service expansion to weekday evenings WHERE ARE THE RIDERS? Population, Employment and Commute Pattern 2000 and 2010 Study Area Demographics and Growth Rates 2000 Total 2010 Total Compound Annual Growth Rate Population 329,500 371,965 1.39% Labor Force 157,615 182,681 1.49% 5,851 4,367 -2.88% Commuters to Downtown Seattle 2000-2010 Proposed Services to Seattle – Bremerton, Kingston and Southworth Initial Ridership Demand Summary 450,000 429,294 400,000 Annual Ridership Demand 350,000 300,000 250,000 6 Round Trips/Day 217,676 200,000 12 Round Trips/Day 177,608 147,335 150,000 100,000 50,000 0 Bremerton Projected Peak Period Demand Kingston Southworth Scenario Bremerton Kingston Southworth 6 RT/Day 36-128/per sailing 71-178/per sailing 59-147/per sailing 12 RT/Day 29-173/per sailing WHAT TERMINAL FACILITIES DO WE NEED? Terminal Locations Identified • Kitsap Terminals – Bremerton – Kingston – Southworth • Eastern Terminal – Pier 50, Seattle • Maintenance Facilities Proposed Improvements Kingston Note: A float is now complete, therefore additional improvements are minimal Southworth Proposed Improvements-Pier 50 • Sheltered terminal building with elevated access to WSF Terminal • Increased queuing capacity for projected Water Taxi ridership • Planning with future routes in mind • Existing float to be replaced with 4 slip ~2021 WHAT VESSELS DO WE NEED? Vessel Acquisition Recommendations • Service Vessels: – Bremerton: RP2 • (118 psgr) – Kingston: High speed • (150 psgr) – Southworth: More typical • (150 psgr) • Backup Capability: – RP3 (to serve Bremerton) – Share assets HOW SHOULD WE MANAGE AND OPERATE THE SERVICE? Service Delivery Options • Organizational Considerations – Marine Operating Environment – Marine Body of Work, Functions & Expertise • Four Alternatives – – – – Publicly Owned and Operated Privately Owned and Operated Public/Private Partnership Public/Public Partnership (recommended) Fare Collection Strategy Develop a fare collection strategy that: – Provides choices and the best transportation value for riders – Builds from a highly successful ORCA program – Reflects the value to the rider of high quality passenger-only services – Avoids AM and PM ridership imbalances & achieves ridership goals Success of ORCA KT Monthly Pass Puget Pass Stored Value April 2014 – Bus Boardings % of Total ORCA 154,812 81% 7,090 4% 29,988 16% April 2014 – Foot Ferry Boardings % of Total ORCA 26,567 89% 311 1% 3,101 10% Fare Collection Strategy How will it work? – Price and collect fares in each direction – Price at current lowest cost alternative plus $1-$3 per trip – Accept all current ORCA products with “top up” as needed – Introduce a new Kitsap Transit Bus + Ferry monthly pass Example Schedules Bremerton Kingston Southworth Depart Bremerton Depart Seattle Depart Kingston Depart Seattle Depart Southworth Depart Seattle 0545 0620 0540 0620 0600 0630 0655 0730 0700 0740 0700 0730 0805 0840* 0820 0900* 0800 0830 1525 1600 1520 1600 1505* 1620 1635 1710 1640 1720 1650 1720 1745 1820 1800 1840 1750 1820 Notes: BOLD times indicate PM * Indicates dead head run for fuel HOW SHOULD WE PHASE IMPLEMENTATION? Phasing Plan Risks: •Bremerton Without Back-up boat (18 mo) •Schedule Risks at Pier 50 (Seattle) HOW MUCH WILL THIS COST AND HOW DO WE PAY FOR IT? Key Financial Assumptions • The annual revenue is set at 75% of the revenue projections calculated in earlier phases of the project. • The King County Marine Division operates the program with service levels and schedules set by Kitsap Transit. • Current King County marine labor rates are used • Farebox revenue growth and cost escalation rates are the same and reflect KTs past experience. • Local tax revenue growth rates also reflect KT experience over the last several years. • The financial plan must address on-going operating subsidy requirements and capital funding. – Launching three routes requires approx. $44M between 2015-2023. – Bremerton and Kingston routes requires approx. $25 M from 2015-2018. • The options for assembling a capital funding portfolio are: – Grants (relying upon the New Starts program) – Bond Financing – Local Funds • Ongoing operating subsidy requirements grow as each route is added Year Annual Subsidy Farebox Recovery Service Level 2016 2018 $2 M $5.4 M 28.6% 33.4% One Vessel serving Bremerton One Vessel serving Kingston, Two vessels serving Bremerton 2023 $8 M 34.5% One Vessel serving Southworth, One Vessel serving Kingston, Two vessels serving Bremerton Analysis of POF Revenue Sources • Current Kitsap Transit revenues are insufficient to support cross sound POF • 2003: HB 1853 passed by State Legislature – Expands authority to provide and fund POF – Signaled intent for local POF funding – State funding primarily reserved for WSF • Local revenue sources – Provide most flexibility and stability (reoccurring) – Most require voter approval Potential Funding Sources • Local – Sales tax (existing PTBA, all transit, POF only) – Motor vehicle excise tax – Property tax/excess levy • State – WSDOT Regional Mobility Grant Program • Federal – – – – Surface Transportation Funds, Urbanized Funds Ferry boat/facilities grant programs New Starts TIGER Grant WHAT ECONOMIC BENEFITS WILL THE SERVICE BRING? Economic Benefit Analysis • Methods – Literature Review – Using Mode Choice Model • Types of Benefits – User – Real Estate – Wider Economic Economic Impacts—User Benefits – Travel time savings to users who opt to take the POF – Benefits of increased accessibility for users who opt to remain on an existing transit service or roadways Scenario Total Market Demand 2013 Annual POF Ridership Annual Ticket Revenue ($2014) Annual Travel Time Savings ($2014) Bremerton – Seattle 6 RT / day 1.37M 212,544 $1.2M $3.2M Kingston – Seattle 6 RT / day 1.07M 167,325 $1.3M $2.2M Southworth – Seattle 6 RT/ day 0.67M 138,805 $0.8M $2.1M Economic Benefits – What the Literature Tells Us Real Estate Benefits: – Property value premiums within ¼ to ½ mile from a station – The price premium may be much higher than average in a metro area with a strong housing market and a reliable transit system that effectively connects residents with jobs and other destinations Wider Economic Benefits: – Increased accessibility – Employment gains – Local economic growth due to enhanced productivity Economic Impacts—Real Estate and Wider Economic Benefits – Using relationships identified in the research and conservative assumptions based on user benefits calculations – Indicative results Wider Economic Benefits / Year Total Real Estate Value Created Within ½ Mile Bremerton – Seattle $811,000 $3.8M Kingston – Seattle $540,000 $3.6M Southworth – Seattle $513,000 $2.1M
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