Chapter 6, ACCS Strategic Plan

This text-only version is offered as a more accessible alternative to this PDF document: Arlington County Commuter Services Transportation Demand Management Plan (PDF, 2.6 MB).

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FINANCIAL PLAN

The ACCS financial plan includes a look at planned base operating budget and expense estimates from FY2018 through FY2023, the organization’s six-year capital budget, and projected expenses by proposed Priority Strategy. The ACCS base operating budget covers the cost of the activities of all core programs. The base budget includes neither the costs of any unfunded expansion programs nor Capital Bikeshare operating or administrative costs. The majority of ACCS’ capital expenses are associated with Capital Bikeshare, renovations to Commuter Stores® and the purchase of new or replacement Mobile Commuter Stores®.

ACCS strives to be financially sustainable to ensure that the award-winning programs continue supporting the efficient use of Arlington’s transportation network by those who live, work, and or visit the County. As such, ACCS diligently tracks expenses and performance to ensure they are providing the best programs at the lowest possible costs. ACCS also keeps a close eye on revenues, which depend heavily on federal CMAQ funding and commissions from fare media sales, and are contingent on larger commuter trends and continued legislative support.

Although a draft is shown in this chapter, ACCS’ FY2018 budget will not be final until the start of the new fiscal year in July 2017. Arlington County’s budget process begins in the fall of each calendar year, and ACCS prepares external grant and funding requests through the early spring of each year. Arlington County’s overall operating budget is adopted at the end of spring and the Capital Improvement Plan (CIP) is adopted in the summer after state budgets are released in June. ACCS’ capital budget is incorporated in the County’s Capital Improvement Plan (CIP) process.

BUDGET OVERVIEW: STAFF SIZE AND RESOURCES

In FY2017, ACCS employed staff to serve the transportation demand management needs of 220,400 residents, over 211,000 employees who work in Arlington, and the many visitors that the County hosts each year. TDM is a person-to-person business, and a cost centers analysis conducted in 2014 revealed that personnel costs account for the largest share of ACCS operating expenses, or 53 percent of the base operating budget. The rest of the base operating budget is made up of production costs (13 percent), facilities costs (7 percent), professional services (11 percent), administrative expenses (7 percent), and computer, data, software, and office equipment related expenses (10 percent).

OPERATING REVENUE AND EXPENSES

Summary

Figure 4 summarizes ACCS’ projected operating revenue and expenses from FY2018 to FY2023. FY2018 figures are based on a draft budget current as of January 2017, however, the FY2018 budget will not be finalized until it is adopted in July 2017. Although the figure has not yet been officially approved, ACCS plans to request $7,000,000 in Congestion Mitigation and Air Quality (CMAQ) funding for FY2023 and that figure was incorporated in the FY2023 projection. All other revenue projections are based on either committed funding (CMAQ) or projections based historical experience with annual increase. The projected revenues are based on the assumption of continuing business operations as they are today.

Figure 4: Projected Operating Revenue and Expenses (In Thousands of Dollars), FY2018-FY2023

Graph omitted from text-only version. Graph data:

Total Expenses:

FY 2018 $11,568
FY 2019 $11,937
FY 2020 $12,316
FY 2021 $12,654
FY 2022 $13,003
FY 2023 $13,362

Total Revenue:

FY 2018 $11,666
FY 2019 $12,668
FY 2020 $11,986
FY 2021 $13,013
FY 2022 $12,535
FY 2023 $14,136

Operating Expenses

Table 37 provides a detailed breakdown of ACCS’ FY2018 proposed and FY2019-FY2023 projected base program operating expenses. Given current known financial operating constraints, with the exception of the Marketing program (which is projected to rise by set amounts), it was assumed that all ACCS base program expenses will increase by 3 percent per year only to account for inflation. The 3 percent increase reflects standard inflation rates and is applied to ensure that programs can remain operating at the same quality as the previous year. As certain programs increase their operations through service expansions profiled in Chapter 5 (such as the Commuter Stores® program opening new facilities, thereby adding annual costs), these base expenses may also adjust during the years to come.

Table 37: Projected ACCS Base Operating Expenses, FY2018-FY2023

Operating Revenue

ACCS’ operating revenue is powered by federal and state long- and short-term grant funding (as well as local matches), contributions from the Arlington County General Fund, contributions from developers through the TDM for Site Plan Development program, office space reimbursements, and fare media sales commissions.

Table 38 provides an overview of the organization’s projected operating revenue from FY2018 through FY2023. Federal Congestion Mitigation and Air Quality (CMAQ) funding is projected to account for at least 40 percent of ACCS’ funding over the entire six-year period. Should ACCS receive the $7,000,000 in CMAQ funding it plans to request for FY2023, CMAQ will comprise over half of the overall budget during that fiscal year.

ACCS’ Regional TCM Term (VDOT) and DRPT TDM Operating Assistance grants are each projected to rise by 3 percent during the six-year period; the VDOT NuRide grant is anticipated to remain flat. Local revenue from the Arlington County General Fund is anticipated to rise by 3 percent each year, while revenue from the TDM for Site Plan Development program should increase by 5 percent each fiscal period. Local transit aid from the NVTC Transit Account will remain flat throughout the six-year period. Internal transfers from the Transit Bureau, which cover the operations of the Commuter Store at Shirlington Station, marketing for Arlington’s fixed route bus service ART, and web and call center services provided for ART, anticipate a 3 percent increase beginning in FY2019. Finally, ACCS also expects that reimbursements for office space will go up by 3 percent each year.

Table 38: Projected ACCS Operating Revenue, FY2017-FY2023

CAPITAL FUNDING

ACCS’ capital revenue sources have primarily been used to fund new Commuter Stores® as well as renovations to existing stores, and the Capital Bikeshare Program. The ACCS capital program is included in Arlington County’s Capital Improvement Plan. Currently, the three main sources are projected to fund ACCS’ capital needs are:

• “Pay-As-You-Go” (PAYG) funds, or County funds that happen to be available at the time of funding;
• Transportation Capital Fund (TCF) funding derived from Arlington’s real estate tax on commercial and industrial (C&I) properties, currently set at $0.125 per $100 of assessed value; and
• TCF funding derived from the Virginia General Assembly’s House Bill 2313, which raises new transportation revenues for Northern Virginia through a series of state-imposed regional taxes and fees. The Northern Virginia Transportation Authority (NVTA) distributes 30 percent of these funds to member localities.

Table 39 shows ACCS’ projected capital funding for FY2018 through FY2023. The capital plan includes a line item for the Columbia Pike Smart Corridor program, which refers to a Smart Scale grant for which ACCS has applied. This program, if approved for funding, will permit ACCS to implement a series of TDM improvements along Columbia Pike, including a new Commuter Store, new bikeshare stations, a real-time and augmented reality transit information program, and new bicycle parking. Finally, as is the case with operating expenses, should expansion programs listed in Chapter 5 be approved, capital funding listed in Table 39 may be subject to change.

Table 39: Projected ACCS Capital Funding, FY2017 – FY2023

FUNDING NEEDS BY PRIORITY STRATEGY

Chapter 5 of this plan covers ACCS’ proposed expansion programs by Priority Strategy, planned for implementation between FY2018 and FY2023. Table 40 shows the cost of these expansion programs – which are not currently included in ACCS’ operating or capital budgets – by fiscal year. In terms of expansion program implementation, FY2020 is projected to be the costliest fiscal year for ACCS. Although many programs are projected to have ongoing, annual costs, initial implementation of expansion programs in FY2021 is anticipated to be relatively less expensive.

Table 40: Priority Strategies’ Cost by Fiscal Year

This text-only version is offered as a more accessible alternative to this PDF document: Arlington County Commuter Services Transportation Demand Management Plan (PDF, 2.6 MB).

Text-Only Table of Contents