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Transit authority faces payment deadline

June 10, 2003|by DON AINES

chambersburg@herald-mail.com

CHAMBERSBURG, Pa. - The clock is ticking on the Chambersburg Transit Authority, but board members insisted Monday they can make a deadline of midnight tonight to pay a $3,000 insurance premium and keep the buses rolling.

At the same meeting, the board voted unanimously to reduce the runs even further, from one route daily to a Monday, Wednesday, Friday schedule beginning June 16.

Further problems could arrive before that midnight deadline at tonight's meeting of the Chambersburg Borough Council, which may discuss whether to shut off the fuel pump for the buses.

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"I think the question has been tossed around, but it's not on the agenda," said Councilwoman Sharon Bigler, who attended the CTA meeting.

CTA President James Jenkins said the authority owes the borough approximately $17,000 for gasoline.

The board is taking additional actions to try and reduce its costs in an effort to stay in operation until July 1, when it hopes to get additional state and federal subsidies. Jenkins said state and federal transportation agencies will not support the CTA's efforts to make it to the next fiscal year if operations are suspended before July 1.

One way is to reduce the number of insured vehicles from seven to four and to negotiate a reduction in the $3,000 premium because of its lower level of operations.

"The premium was based on more buses running than we have now," said Merle Frey, a member of the board.

Coming June 23 is another deadline, when the authority must pay its workers' compensation premium. Peg Eyer, who is serving as an unpaid volunteer to manage the authority's administrative affairs, said she will try to negotiate a lower rate on that premium based on the authority having reduced the number of people it employs since it went from seven routes to one in March.

"The (insurer) has already told me that will come down," Eyer said.

The authority still faces major hurdles over the next 20 days, including coming up with a budget and a recovery plan to submit to the Pennsylvania Department of Transportation. Last month, Borough Manager Eric Oyer said he had decided not to help the CTA draft a recovery plan because there did not seem to be any way for it to pay off its debts to local creditors, even if the money it owes to state and federal transportation agencies is forgiven.

At the May 27 meeting, an independent audit showed the authority had more than $1 million in liabilities against $321,000 in assets at the end of June 30, 2002. Since then, Oyer said he believed the financial picture had worsened and that the CTA had minimal assets, but still about $1 million in debts to government agencies and private vendors.

The audit for the 2000 to 2002 budget years showed the authority has misapplied hundreds of thousands of dollars earmarked for the purchase of buses and other capital improvements and used them for operations.

"I don't think many people think we can pull it off, but I think we can," Eyer said about getting the bus system back on better financial footing.

Jenkins said the system will try to operate on fares, donations and charters until next month. That includes donations from board members, he said, noting Sam Kuhn had paid the bill for storing the buses at a new location after they were ordered moved last month by the owner of the lot where they had been stored.

Board member Wade Burkholder said he was concerned about continuing operations if the authority was just going to incur more debt.

"When you're going down a hole ... you don't ask for a bigger shovel," he said.

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