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Posted on Wed, Sep 23, 2009 : 6:18 p.m.

AATA board approves balanced 2010 budget, uses $220,000 in stimulus funds to bridge Ypsilanti shortfall

By Ryan J. Stanton

The Ann Arbor Transportation Authority board of directors today approved a balanced budget for 2010 and decided to use $220,000 in federal stimulus money to cover bus service agreements to bridge gaps in Ypsilanti and Ypsilanti Township.

The board decided unanimously to make the emergency move to assist the two communities, keeping transit services going for the next year without cuts to services.

Ypsilanti city and township officials had informed AATA that, as a result of adverse economic conditions, the amount billed for their services next year was more than they could afford to pay.


AATA board member Ted Annis, left, objected to the adoption of AATA's $25 million budget today, saying it was "too fat." Ryan J. Stanton |

"I think it's unfortunate that Yspilanti and Ypsilanti Township find themselves in this position. I think, frankly, it's understandable," said board chairman David Nacht. "Let's be absolutely plain about it, this is a subsidy. It is a transmission of wealth from this agency, which has the ability to spend these funds, to the eastern side of Washtenaw County."

Nacht said even though the AATA is a creation of the Ann Arbor City Council and primarily funded by Ann Arbor taxpayers, the Ann Arbor community and economy depends on the labor that comes from Ypsilanti. For that reason, he said it makes sense to use AATA stimulus money for Ypsilanti.

AATA board member Charles Griffith said the use of stimulus funds is only a short-term solution to a financial problem that is expected to continue. He said it points to a deficiency in the current way AATA services are structured, forcing municipalities outside Ann Arbor to use limited general operating funds to contract for services when Ann Arbor has a long-term millage to pay for its share of services.

AATA board members said they expect Ypsilanti city and township officials to spend the next year exploring longer-term funding solutions. AATA also is gauging interest in a countywide millage.

The 4-1 vote to approve the 2010 fiscal year budget was less easily reached by AATA's board today. AATA officials were able to cut $828,000 from the budget, but that wasn't enough for board member Ted Annis, who wanted to see another $1 million in costs trimmed.

"I can't support the budget. I think the budget is too fat," Annis said. "If we want to get to a countywide bus system with a countywide millage, we're going to have to show a very good efficiency."

Annis said AATA is operating with more than $4 million in inefficiencies. He said the current cost per bus service hour is $102, and he'd prefer to bring that down to $96.

The budget for the fiscal year starting Oct. 1 totals $25.5 million, about $9.7 million of which comes from local tax revenues. Another $1.1 million comes from purchase of service agreements, $4.3 million from passenger revenues, $6.8 million in state assistance, $3.2 million in federal assistance and $361,200 in interest.

Other board members commended the work of AATA CEO Michael Ford and his staff for working to identify cost reduction strategies. AATA officials said both management and union personnel worked together to study all aspects of AATA's operations.

Among the measures implemented are the conversion of AATA's phone service to Voice Over Internet Protocol in partnership with the city of Ann Arbor, the recycling of old bus signs, increased efficiencies in the use of personnel and the sale of waste oil to refineries for reprocessing instead of paying vendors to dispose of it.

The new budget includes payments of $320,000 for a local connector study and $200,000 for the commuter express route from Canton, which is funded through a federal grant and passenger fares.

Ford said AATA expects to come in under budget for the fiscal year ending this month.

Ryan Stanton covers government for Reach him at or 734-623-2529.


Steve Gutterman

Thu, Sep 24, 2009 : 1:12 p.m.

There is a likelihood that a local options bill will be reintroduced in the House this session. Local options is the way that most new transit projects around the country have been locally funded in recent years. Local options also has the support of Michigan roadbuilders and related industries. Enabling state legislation alone would allow counties to put to voters the choice to impose local gas and diesel fees, local vehicle registration and license fees, or local property transfer taxes. A State Constitutional amendment plus enabling state legislation would allow counties to put to voters the choice to impose a local general sales tax.

Nancy Shore

Thu, Sep 24, 2009 : 12:50 p.m.

I really applaud the AATA's efforts to try to find a solution to keeping bus transportation viable to the eastern part of the county. As David Nacht stated, there are a tremendous number of employees that live in the Ypsilanti and Ypsilanti Township area that use AATA buses to get to work. It is in the economic interest of Ann Arbor to find ways to support the eastern part of the county. At the same time, this sort of funding is not sustainable, so some sort of regional solution will have to be considered. At this point, I'm not sure if there is any better idea out there than a millage.

ann arbor girl

Thu, Sep 24, 2009 : 12:30 p.m.

A strong regional transit system must be developed, if Washtenaw County is to accomodate the residents and industries we need in the future. I've been following AATA for awhile including reading meeting minutes & reading financials - the "fat" Mr. Annis refernces appears to be due to how different transit agencies account for expenses (some include some items for overhead, others do not). Given this, AATA's cost per service hour was seen as greater than some others. From what I've been seeing, AATA staff continue to do a terrific job providing transit service given the limited dollars available to them.

Steve Gutterman

Thu, Sep 24, 2009 : 11:33 a.m.

Some responses to previous comments: There are no transportation modalities that operate without public subsidies, and that includes automobile travel. The taxes you pay on fuel (a direct tax) do not fully pay the costs of driving, which includes road construction and repair, traffic enforcement, emergency service--all public services; accident-related medical expenses; geo-political/military expenses to keep cheap oil flowing; air, water and noise pollution; long-term resource depletion; negative land use impacts (including loss of productive land and carving up of communities for freeways); and other costs borne by society at large. Through federal and state general taxes, we publicly subsidize passenger and freight transport via private automobile, truck, plane, train and ship. I don't have children, yet I pay taxes that go to the public school system to help subsidize the education of other people's children. As a taxpayer, I pay into services that benefit the public good, some of which personally benefit me, others which do not. Some public expenditures I am vehemently opposed to, such as the choice to invade Iraq (over $600 Billion and counting) But I do not consider paying taxes in principle to be theft; I consider it an investment in the public good and my obligation as a member of society and a functioning democracy.

Chuck Warpehoski

Thu, Sep 24, 2009 : 9:31 a.m.

Ted Annis would have more credibility when he calls for "efficiency" if he had spent time actually RIDING the AATA buses and the buses of the systems he wants to compare us to. Efficiency is one measure of a bus system, but it's not the only one. If you cut expenses for service coverage, bus maintenance, etc. to the point that nobody wants to ride the bus, you may have a low cost/service mile (the metric Ted focuses on), but you would NOT have a well-functioning bus system.

Tort Reform

Thu, Sep 24, 2009 : 7:23 a.m.

Equating charitable giving with taxation forced at the point of a gun is laughably disingenuous.


Thu, Sep 24, 2009 : 5:32 a.m.

Bailouts? Is that what the bible called helping the least of your brethren? As a responsible citizen, I want to do my part to see that ALL children have transportation to school, that ALL working poor have transportation to work. Even the most narrow self-centered vision surely sees that working poor pay taxes too.

Ryan J. Stanton

Wed, Sep 23, 2009 : 8:56 p.m.

Ford said AATA officials already have identified 19 possible opportunities to work toward further cost reductions in 2010. The budget also takes into account AATAs five-year labor contract, which officials say has enabled AATA to take major steps toward controlling the future costs of health care for both active and retired employees. Ford said the full extent of the savings will be realized in the fifth year of the contract.


Wed, Sep 23, 2009 : 6:07 p.m.

So what happens next year? Who will AATA lean on to support an inefficient bus business?????? AATA needs to be profitable or downsize operations. No more bailouts!