Staff Report #9
October 30, 2024
To All Commissioners
Re: Financial Update – Conventional Transit Services – Operating Budget – September 30, 2024
Recommendation
That the report be NOTED and FILED.
Background
Set out in the table below is the Statement of Operations for Conventional Transit Services for the nine-month period ending September 30, 2024. The statement sets out actual to budget performance for the period.
London Transit Commission Statement of Operations – Conventional Transit Services Nine Months Ending September 30, 2024 (000’s omitted)
| Description | Actual | Budget | Amount Better (Worse) | Percent Better (Worse) | |
| Revenue | |||||
| Transportation | $ 28,470.5 | $ 28,458.3 | $ 12.2 | 0 .0 % | |
| Operating | 2,191.3 | 1,495.6 | 695.7 | 46.5 % | |
| Transfers from reserves | 937.8 | 1,203.2 | (265.4) | (22.1)% | |
| Province-provincial gas tax | 8,002.0 | 8,400.1 | (398.1) | (4.7)% | |
| City of London | 32,315.3 | 32,315.3 | – | 0.0 % | |
| Total revenue | 71,916.9 | 71,872.5 | 44.4 | 0.1 % | |
| Expenditure | |||||
| Personnel cost | 46,653.0 | 47,183.6 | 530.6 | 1.1 % | |
| Direct bus maintenance | 6,937.7 | 6,836.1 | (101.6) | (1.5)% | |
| Fuel | 6,983.4 | 7,821.7 | 838.3 | 10.7 % | |
| Facility costs | 2,320.0 | 2,553.0 | 233.0 | 9.1 % | |
| Insurance | 3,911.7 | 4,235.9 | 324.2 | 7.7 % | |
| Contribution to reserves | 978.7 | 561.6 | (417.1) | (74.3)% | |
| All other material expense | 2,818.8 | 2,680.6 | (138.2) | (5.2)% | |
| Total expenditure | 70,603.2 | 71,872.5 | 1,269.3 | 1.8 % | |
| Net favourable/(unfavourable) | $ 1,313.6 | $ – | $ 1,313.6 | 1.8 % | |
As indicated in the above table, the conventional service has a net favourable operating budget performance to-date of 1.8% or $1,316,600. An explanation of the variances is set out below.
Revenue
- favourable operating revenues of $695,700 due mainly to higher interest income earned, noting $417,100 relates to interest earned on reserve funds and is highlighted below as an unfavourable contribution to reserves;
- unfavourable transfers from reserves of $265,400 as the required contribution to cover insurance claims is $265,400 less than budgeted, noting this decrease is offset below within the favourable insurance cost; and
- a reduction in projected provincial gas tax requirements at this time, noting a full analysis of reserves and reserve funds, including provincial gas tax, will be completed at year end.
Expenditures
- favourable personnel costs of $530,600 due primarily to the timing of filling vacant positions;
- unfavourable direct bus maintenance and servicing costs of $101,600 due mainly to the continued outsourcing of MTO inspection work required due the vacant positions in Fleet and Facilities;
- favourable fuel costs of $838,300 due mainly to continued lower than budgeted diesel fuel prices;
- favourable insurance costs of $324,200 due to lower than budgeted claim costs ($265,400) and a favourable 2024-2025 insurance program renewal ($58,800); and
- unfavourable contributions to reserves of $417,100 due to the increase in interest income earned on reserves, noted above in operating revenue.
Ridership
The table below sets out actual to budget ridership performance as well as a comparison to the same period in the previous year.
Ridership Performance – Actual vs. Budget Nine Months Ending September 30, 2024 (000’s omitted)
| Description | Actual | Budget | Variance | % Variance | 2023 Actual | % Variance |
| Total Passengers (000’s) | 14,240.8 | 14,047.9 | 192.9 | 1.4 % | 13,182.0 | 8.0 % |
| Average Fare | $ 1.999 | $ 2.030 | $ (0.031) | (1.5)% | $ 1.948 | 2.6 % |
| Revenue Service Hours | 525.6 | 526.4 | (0.7) | (0.1)% | 504.8 | 4.1 % |
| Rides/Rev Service Hour | 27.1 | 26.7 | 0.4 | 1.5 % | 26.1 | 3.7 % |
Administration will continue to monitor the operating budget performance, including ridership, on a monthly basis.
Recommended by:
Mike Gregor, Director of Finance
Concurred in by:
Kelly S. Paleczny, General Manager