Why a New Contract

   
 

In early 2013, County Executive Chris Able directed the Milwaukee County Department of Transportation (MCDOT) to maximize transit value and accountability and, ultimately, service by aggressively bidding out the transit contract. MCDOT issued a new request for proposal (RFP) and received five bids, including one from MTS.

 

An independent panel of experts scored the bids on numerous criteria and recommended awarding the new contract to MV Transportation.

  

A new contract was negotiated between the County and MV and had the goal of increasing value and minimizing risk to the County. The proposed contract with MV (signed by both the County and MV) would have annually shifted $15 million from management and administrative expenses toward operations and service. This $15 million reinvestment could have:

  • Increased annual hours of bus services by approximately 140,000. This would be the equivalent of restoring all service cuts to the system that have taken place since 2003. This would have also meant the addition of hundreds of new jobs for drivers, mechanics and others.

  • Restored service frequency on routes where service has been reduced over time.

  • Restored and expanded service to business parks and job centers.

  • Expanded service to improve educational opportunities to area colleges and universities.

  • Increased ridership for an additional $11.5 million in revenue per year, assuming transit services were restored to 2003 levels – leading to further service expansion or fare reduction. 

In addition to this major reinvestment, the proposed contract ensured:

  • The Milwaukee County Board would continue to have the final say on fares and routes.

  • Any contractual deficits realized during the fiscal year would have been absorbed by the vendor. Under the current contract, deficits are covered by the taxpayers of Milwaukee County.

  • Operating incentive payments would be shared with Milwaukee-based employees of the vendor.

  • The vendor was held to specific performance standards and could be fined if they were not met. The current contract contains no such penalties.

  • Detailed, line-item budget and financial information would be shared with to the County. The current contract has no such requirements.

  • The real estate, buildings, buses, motor vehicles and equipment required for the operation of the transit System shall continue to remain the property of Milwaukee County.

  • The vendor would not be permitted to enter into emergency contracts that last longer than one year. The current contract allowed the incumbent vendor to enter into a three-year emergency contract for paratransit services that resulted in an unnecessary cost of $8 million to taxpayers.

  • Collective bargaining agreements and collective bargaining continue.

  • Current MTS employees are considered for positions in the new firm.

The Milwaukee County Board declined to consider the new contract; instead they want to “insource” the transit system (ie. County government running the system, without the help of expert providers). County Executive Abele and many others have serious concerns about the logistics and cost to taxpayers of transitioning more than 1,000 MCTS employees into county employees. The move would also mean losing the flexibility and expertise an outside company can provide. County Executive Abele has asked the County Board to stop their insourcing effort and instead work with him on issuing a new RFP. The Milwaukee Journal Sentinel supports the plan, as do many community leaders and groups.

 

As we saw with our last RFP, a competitive bidding process will allow us more money for transit operations along with a better contract. 

 

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