Wichita council exploring stopgap funding options for transit system

With a $2 million shortfall looming for Wichita’s transit system, City Council members are considering a stopgap approach for next year as they review options for new long-term funding.

During a workshop Tuesday, council members looked at several ways to save the system from a funding “death spiral,” including a proposed sales tax of 1/10 of a cent recommended by the Transit Advisory Board.

But some council members said they weren’t sure voters were ready for a new sales tax proposal just eight months after they soundly defeated a proposed 1-cent sales tax that would have raised $400 million over five years to fund transit, street maintenance, a new water supply and a jobs fund.

And the state sales tax rate went up to 6.5 percent on July 1, meaning Wichitans already will pay 7.5 percent total.

“Transit is incredibly critical to the success of a city our size, so my hope is to find a revenue stream that will make it more robust,” said Mayor Jeff Longwell.

“My fear is if we go out today (with a sales tax proposal) that we’ll catch the brunt of the anger and sentiment of our citizens that want to take it out on the state or anyone else that has raised taxes and are going to share their disgust by voting this one down to send the message to everyone.”

“I’m not going to do that,” Longwell said. “I’m not going to make us a poster child for all government just so this can fail and be a message. It’s too critical. So we’re going to figure out how we can get it done and the right timing for it.”

With less than a month before the city finalizes next year’s budget, Longwell directed City Manager Robert Layton to find $2 million to plug an expected transit deficit.

It’s not yet clear where that money will come from.

In the meantime, Longwell said, the city should create redesigned routes and survey the public over the “appetite” for a new sales tax.

Council members expressed frustration with the situation.

“We can’t kill our transit system and that’s just about what we’re doing,” said council member Janet Miller, stressing the importance of transit for the working poor. “I’m even willing to look at a mill levy increase, and I’m sure everyone’s head up here just exploded.”

Council member James Clendenin said he doesn’t think that the failure of the sales tax last fall means the council can’t ask the public again on transit alone.

Funding options

Transit director Steve Spade told the council there are four options: cutting service, shifting money from the general fund, creating a 1/20 of a cent sales tax or creating a 1/10 of a cent sales tax.

None of those options helps make the system more robust except the 1/10 of a cent sales tax, he said, and the current system is running at about 50 percent of the service that it should be for a city of this size.

One-tenth of a cent is the same amount transit would have received last fall if that referendum had passed. The tax would generate $7.1 million next year and more than $8 million by 2018 and for the next several years, according to projections.

Of that, about $3 million a year would go toward paying transit’s debt service to the city, Spade said. The other $5 million would fund improvements to the system, like extended routes and hours.

A sales tax of 1/20 of a cent would generate about $3.5 million in 2016. That amount would meet transit’s financial obligations, but would not allow for it to expand.

Even if service has to be cut, Spade said, transit should still look at redesigning and streamlining routes in areas with higher ridership, primarily in the core of the city.

A service cut would mean eliminating eight routes on Saturdays and further reducing Saturday hours from 12 hours to eight, Spade said.

This story was originally published July 7, 2015 at 6:59 PM with the headline "Wichita council exploring stopgap funding options for transit system."