Attachment 1ATTACHMENT 1
March 2019 School Bus Program Business Plan
TOWN OF LOS GATOS
SCHOOL BUS PROGRAM BUSINESS PLAN
Page 1
S C H O O L B U S P RO G R A M B U SI N E S S P L A N
1. BACKGROUND
In August 2016 the Town completed a Traffic Around Schools study which identffied optfons to mitfgate
the traffic congestfon around schools. The study has guided Town efforts towards creatfng Safe Routes
to Schools. One recommendatfon within the report is a school bussing program. Staff undertook a
Congestfon Relief School Bus Feasibility Study and in June 2018 the Town Council authorized staff to
proceed with a school bus pilot program targetfng a January 2019 start date. In the following months,
the Town proposed three routes based on potentfal ridership and sought signups from potentfal riders.
At the September 18, 2018 meetfng, the Town authorized the two routes with the highest sign up
numbers to proceed in the January 2019 pilot service. The pilot includes Route A - North Los Gatos to
Fisher Middle and Blossom Hill Elementary Schools and Route B – the Mountains to Los Gatos High
School and Fisher Middle School.
With the successful launch of the service, staff is presentfng this Business Plan to provide an in-depth
analysis of the program’s financial and organizatfonal outlook over the next five years and to present
two new concepts for the Council’s consideratfon. The Business Plan is tfmely as it prepares for
ongoing discussions of funding, staffing, and program size. By startfng the conversatfons early, the
Town will have more opportunitfes to explore resources to with which to create a sustainable program.
The Business Plan incorporates and is supplemented by a technical report prepared by the School Bus
Consultants. The technical report is included as Appendix A. Staff also relied on the experience of peer
agencies in the Bay Area in preparing the analysis. The Town’s pilot has much in common with these
programs, while maintaining its own differentfatfng factors. The peer agencies are listed in Table 1:
Table 1 – Peer Agencies and Locatfons
Agency Scale (# of routes) Schools Location
TRAFFIX 23 11 San Ramon Valley
Lamorinda 22 12 Lafayette, Moraga, and Orinda
Reed Union 12 4 Tiburon and Belvedere, Marin County
Ross Valley 10 3 San Anselmo and Fairfax, Marin County
Mill Valley 3 3 Mill Valley, Marin County
Los Gatos 2 4 Los Gatos
Town of Los Gatos
Page 2
2. PROGRAM GOALS AND BENEFITS
The Town has identffied a school bussing program as one piece of a multf-faceted approach towards
relieving congestfon around schools. From the very start the program has received strong support
from the schools, parents, and the community. Despite the small scale, the ridership as of March 1
includes 113 passengers, with 50 on Route A and 63 on Route B. Figure 1 illustrates passengers by
school.
Figure 1 – Passengers by School
The program’s transportatfon goal is to reduce traffic congestfon around schools. The congestfon relief
goal can be quantffied as a measurable industry standard of automobile trip reductfon. This may serve
as a more effectfve measure than the alternatfve industry standard of intersectfon delay as this latter
measure may not reflect an impact with a project. Tracking the reductfon of traffic congestfon at the
most impacted locatfons around school during the school peak tfmes will measure the value of
congestfon relief. Tracking the school-related automobile trip reductfon will measure the local and
regional transportatfon impacts and air quality benefits.
The Feasibility Study completed in 2018 identffied several congested corridors near schools, including
Los Gatos Boulevard, E. Main Street, South Santa Cruz Avenue, Blossom Hill Road, Shannon Road,
Highway 9, and Highway 17. The bus routes in the pilot program will help alleviate congestfon during
school bell tfmes on all of these congested corridors.
The total number of school-related automobile trips reduced is estfmated to be 101 per peak period
from the 113 students riding the bus, assuming on average 0.89 automobile trip/student1.
1 Calculated based on the family carpool rate of the current passengers. It was assumed that all children from
the same household were riding in the same family vehicle before started taking the bus.
Los Gatos
High School,
19
Fisher
Middle
School, 64
Blossom Hill
Elementary
School, 23
Lexington
Elementary
School, 7
Passengers by School
Total = 113
SCHOOL BUS PROGRAM BUSINESS PLAN
Page 3
The two-route pilot will reduce 2% to 4% of the total automobile volumes at the most impacted
intersectfons around schools during the peak 15-minute periods (Table 2). This is a moderate start of
congestfon relief at these most impacted locatfons. To reach a level of relief that is more notfceable,
the total auto volume reductfons during the peak 15-minute period would need to exceed 10%, which
will require four to six bus routes.
Table 2 - Congestfon Relief and Automobile Trips Reductfon at Most-impacted Locatfons
Auto volumes Automobile Trips Reduced
Locatfon (15-minute peak) 2019 2024 Goal
Blossom Hill Rd./Los Gatos Blvd. 990
19 99
Blossom Hill Rd./Cherry Blossom Ln. 458 19 45
Los Gatos Blvd./Shannon-Roberts 588 25 59
Average % of total auto volume 4% 10%
3. MARKET ANALYSIS
The Feasibility Study identffied 335 amenable passengers, which is approximately 6.5% of the total
student enrollment at 5,155 of the target schools. In the best-case scenario, assuming all of the
amenable passengers can be accommodated on the same routes, the Town can provide six routes at 56
passengers per route. However, it is important to note that the geographic distributfon of the
amenable passengers doesn’t lend itself to grouping all these passengers to only six routes.
Table 3 is a comparison of peer programs with an assessment of the current program size in relatfon to
the student enrollments. The average ridership among peer agencies is approximately 10% of total
student enrollment if the outlier of Reed Union is removed. Applying this typical 10% ridership to the
Los Gatos enrollment populatfon, the calculatfon results in 516 potentfal riders as the program matures.
Table 3 - Comparison of Peer Program’s Service Levels and Ridership
Agency Funding Source
(in addition to fare)
Year
Started
Current Riders/
Routes/Schools
2017/18 Student
Enrollment
Ridership/
Enrollment
TRAFFIX County Measure J 2009 1,700/ 23/ 11 32,504 5%
Lamorinda County Measure J 1994 1,500/ 22/ 12 13,628 11%
Reed Union County/City General
Fund, Sales Tax
2016 635/ 12/ 4 1,444 44%
Ross Valley County/City General
Fund, Sales Tax
2016 401/ 10/ 3 2,094 19%
Mill Valley County/City General
Fund, Sales Tax
2016 140/ 3/ 3 3,086 5%
Los Gatos Town General Fund 2019 113/ 2/ 4 5,155 2.7%
Notes: Prepared by School Bus Consultants 2019
Target school enrollments include all schools in the Los Gatos Union School District and Los Gatos High School.
Town of Los Gatos
Page 4
Should the Town seek to reach the theoretfcal 10% ridership mark with five or six routes, an effectfve
strategy would be to reuse buses amongst two tfers of service in both the morning and afternoon.
Reusing a bus twice in a service period would double the potentfal capacity. Effectfve bell tfering allows
for this reuse of buses and has been employed in Lamorinda and TRAFFIX. Therefore, in order to best
achieve a greater portfon of the market with limited financial resources, bell tfme coordinatfon in the
community will be necessary. The first step would be to align bell schedules to be consistent on all
school days in each school. The second step would be to establish bell tfering. This will be an endeavor
to discuss with the Town’s partner districts at the pilot stage as interest in the programs grows.
4. COST PROJECTIONS
For projectfon purpose, this Business Plan sets the range of service scale as between two and six routes
in Year 5. The Town has a five-year contract with Student Transportatfon America (STA). An annual
increase of 3% in the first four years and an increase of 4% in the last year are included in the contract.
Based on the service contract and informatfon from peer agencies, Town staff and consultant estfmated
the cost projectfons as shown in Table 4. The program’s cost increases in the next five years were based
on the current contract with the transportatfon provider. The total expenditures include transportatfon
service, contract management, customer service, tfcket sales, and program administratfon.
Table 4 - Projectfons of Costs
The five year cost projectfon aligns with comparable services in other communitfes . Going beyond the
five-year tfme frame, the service cost is more difficult to project and may increase at a higher rate.
Many agencies have experienced 20% to 30% increases upon establishing a new contract or upon
contract renewal. A Lamorinda School Bus Program report indicated that many of the northern
California school bus programs are facing the high level of cost increases due to competftfve
compensatfon and benefits required to attract and retain drivers.
5. REVENUE AND FUNDING STRATEGIES
As discussed in the Pilot Program Implementatfon Plan, this service would be funded by three sources:
fare revenue, grants, and Town funds.
Revenue - Fare
Year 1/2 Year 2 Year 3 Year 4 Year 5
FY 18/19 FY 19/20 FY 20/21 FY 21/22 FY 22/23
Two Routes 2 2 2 2 2
$167,528 $285,563 $294,130 $302,954 $315,072
Six Routes 2 2 2 4 6
$167,528 $285,563 $294,130 $605,908 $945,216
SCHOOL BUS PROGRAM BUSINESS PLAN
Page 5
The pilot program’s fare structure was established based on the parent survey indicatfng a high
sensitfvity to the fare. The Council approved the fare structure at $350 for a full year of service with
the understanding that introducing a very affordable model was necessary to build momentum in the
number of subscribers.
Farebox recovery ratfo is a measure of fare revenue as a percentage of the total expense. Based on the
passenger count at the end of December 2018, the first half year of the program will have a farebox
recovery ratfo of 10%. In FY 19/20 the ratfo is expected to increase to 15%, assuming an optfmistfc
ridership increase to reach 60 passengers per bus. These fare revenue figures are relatfvely low in
comparison to the peer agencies. In the FY18-19, Lamorinda’s farebox recovery ratfo was 31% and
TRAFFIX was 20%.
Assuming a goal of 30% farebox recovery ratfo for the Town’s program, this sectfon provides an analysis
of what it may take to get to this goal. Table 5 shows that the 30% ratfo would require a fare at $769 in
Year 5 if the buses are filled at 60 passengers. This fare target would require a 30% annual increase
startfng in Year 3, Fiscal Year 2020/21.
Table 5 - Cost and Fare Projectfons
It is important to understand the fare’s impacts on total revenue and ridership. The survey showed that
only 12% of the potentfal customers were willing to pay $750 or more . This demonstrates that
increased fares work counter to the goal of increased rid ership. A fare increase to this rate could create
a ridership decrease of up to 88%.
Lamorinda is planning to conduct a parent survey testfng a range of fees between $800 and $1,100.
The earliest opportunity for the Town to survey the parents for price sensitfvity is at the end of 2019.
The feedback can be used in determining the pass price in school year 2020/21. However, the program
may be too new to sustain a drastfc fare increase at this tfme.
Revenue – Grants and Regional Funds
In the past the Town has pursued the Transportatfon Fund for Clean Air (TFCA) grant through the Bay
Area Air Quality Management District (BAAQMD). However, the TFCA program would only grant a
marginal amount of the Town’s request due to the low air quality benefits. This determinatfon by the
Year 1/2
FY 2018/19
Year 2
FY 2019/20
Year 3
FY 2020/21
Year 4
FY 2021/22
Year 5
FY 2022/23
Farebox Recovery Target 10% 15% 19% 23% 30%
Fare $180 $350 $455 $592 $769
Town Contributfon $1,565 $2,030 $1,996 $1,933 $1,831
Annual Increase Rate 0% 30% 30% 30%
Town of Los Gatos
Page 6
BAAQMD will also make the TFCA grant funding highly unlikely in future years, unless the grant policies
are changed.
All other congestfon relief school bus programs receive dedicated sales tax revenue. The Contra Costa
County’s Measure J has a specific category of “Safe Transportatfon for Children” for a total of $90.9
million over 25 years. The dedicated funding levels are $1.6 million per year for the San Ramon Valley
School Bus Program (TRAFFIX) and $1.06 million per year for the Lamorinda School Bus Program. The
latest update came from Marin County. Measure AA , passed in November 2018, requires that 5% of the
revenue be spent on student transportatfon. Startfng in FY 2019/20 Marin Transit will contribute
$600,000 annually to the existfng five yellow bus programs within the County.
In comparison, the 2016 Santa Clara County 2016 Measure B doesn’t have dedicated revenue for a
school bus program. The Town may partfcipate in the competftfve category of “Innovatfve Mobility
Solutfons.” Staff’s positfon is that the Town’s school bus program is eligible, based on the current
program policies and guidelines. The annual funding level is approximately $1.5 million for the entfre
County.
Within Measure B, the project is also listed under the Highways program. Current focus on this
program is achieving a listfng for Highway 17 improvements. Staff recommends pursuing funding
through this program in 2021.
The final eligible program for congestfon relief funding within Measure B is the pavement maintenance
program. This program allows flexibility if the Towns Pavement Conditfon Index achieves a ratfng of 70
or higher. Should the Town reach this target, the Council could discuss repurposing capital
infrastructure funds to pay for part of the operatfonal costs of a school bus program.
It is worth notfng that there are great risks of not having dedicated revenue sources to support an
ongoing service. In California and in the Bay Area, there are very few transit service programs that rely
on competftfve grants as a predictable funding source. The few exceptfons are Stanford and Caltrain
shuttles, and VTA’s Downtown Area Shuttle (DASH), all of which are considered first- and last-mile
connectfons to major transit services. Although it is a smart strategy to use competftfve grant funds for
capital projects, it is very risky to rely on competftfve grants for services. Capital projects can wait for
funds as they tend to have a long project development tfme frame. Service is ongoing so the revenue
needs to be consistent and ongoing.
Revenue – Town Sources and Other Partner s
The FY2018-19 Capital Improvement Program (CIP) Budget includes $453,090 in FY 18/19 and FY19/20
for a pilot school bussing program for 18 months. Town subsidy in future years would need to be
discussed annually as part of the budget process.
Based on the experience of the peer agencies (Table 3), the Business Plan identffies these potentfal
funding sources for consideratfon:
SCHOOL BUS PROGRAM BUSINESS PLAN
Page 7
• General Fund: Town Council’s discretfon
• New dedicated funds – such as property assessments
• Contributfons from Santa Clara County and the citfes of Monte Sereno and San Jose (note that
no students from Monte Sereno or San Jose currently ride the bus)
• School Districts
• Non-profits and private contributfons
As of spring of 2019, Town staff have engaged the school districts and other jurisdictfons in
conversatfons of funding contributfons. None of these agencies has committed financial contributfon.
6. MANAGEMENT CHALLENGES
To contfnue to provide the service in the long term, the Town will face several management challenges.
Contracted Service:
The Town’s own experience and other agencies confirmed that there are very few providers available in
the student transportatfon business. This is a highly regulated field with a high level of liability. The
lack of competftfon and the high labor cost have resulted in increasing cost to public agencies .
The Town’s contract provider, Student Transportatfon of America (STA), has performed at a high service
level with a 100% delivery rate. This level of performance directly benefits the customers and is above
industry average.
Contract management:
In additfon to the working hours needed to manage the program, the wide range of expertfse necessary
is worth notfng. The four categories of tasks listed in Table 6 require very different skills and
experiences, many of which are not interchangeable. It is typically unrealistfc to expect all the skills
from a small staff. That experience is confirmed in the Town’s experience in startfng the pilot service.
Managing the service contract properly contributes to the high level of service quality, which is the
foundatfon to grow ridership. It is more beneficial and efficient to manage the contract properly than
dealing with the consequences and liabilitfes due to poor management.
Table 6 - Percentage of Staff Time on Tasks during a School Year
Tasks Fall Winter Spring Summer
Operations 60% 50% 30% 10%
Planning 5% 15% 25% 40%
Communications 30% 20% 20% 25%
Administrative 5% 15% 25% 25%
Total 100% 100% 100% 100%
Notes: Prepared by School Bus Consultants 2019
Town of Los Gatos
Page 8
7. ORGANIZATION STRUCTURE AND FIVE-YEAR OUTLOOK
This sectfon offers several optfons of how a program is managed and the pros and cons of each optfon.
A detailed analysis is provided in Appendix A. Table 7 provides a high-level comparison of these
optfons.
Town L ed and M anaged
This is the current model the Town of Los Gatos utflizes. The contracted school bus operator is
delivering the service and overseeing many dutfes such as driver dispatching, fielding bus locatfon
inquiries, maintaining buses, and staffing drivers. In this structure, Town staff is engaged with all
administratfve responsibilitfes; communicatfons with the parents, schools, and other interested partfes;
and contractor oversight dutfes. Oversight of the operatfonal dutfes is typically a daily task which at
tfmes (and especially during the start of the school year or when routes are changed) become s
substantfally tfme consuming.
Outsourced Program Management
The optfon exists for the Town to contract with an entfty to manage all administratfve, communicatfon ,
and oversight responsibilitfes for the school bus service. Town staff would stfll be engaged at the
highest level of oversight, with responsibility for ensuring the management service provider is
performing satfsfactorily as well as actfng as the high-level decision maker under the directfon of the
Town and its Council. Although this approach may be at comparable costs to a Town-managed
program, it may be challenging to identffy qualified program management service providers who have
the range of expertfse necessary to perform all required dutfes at the level the Town expects.
J oint Powers A u thority (JPA )
As the program grows, another optfon that exists is to transfer the authority and management of the
program to a Joint Powers Authority (JPA) organizatfon in which the Town would be one of several
partfcipatfng members. This is the structure in the TRAFFIX and Lamorinda programs and requires
engaging partner countfes, school districts, schools, municipalitfes, and other partner agencies who are
current or future stakeholders of the program. Under a JPA, the program management would fall
under the supervision of a member board that would hire staff to perform all administratfve,
communicatfon, and operatfonal dutfes. It is possible that an outsourced management system could be
contracted by the JPA as well. Under a JPA structure, Town staff would likely only be involved as a
member of the JPA board.
Transit Agency As A Service Provider
Currently none of the peer agencies is applying this model, although Marin County is studying this
optfon. Marin Transit is providing technical support to the programs in Marin County, actfng as the
SCHOOL BUS PROGRAM BUSINESS PLAN
Page 9
management entfty overseeing the service contracts. This model allows the Marin County programs to
benefit from Marin Transit’s expertfse in bus service delivery and management.
Table 7 - Pros and Cons of Program Management Optfons
Option Town-Managed Outsourced JPA Transit Agency
Decision-Making Town: 100% Town: 100% Shared Shared
Cost to Town High High Medium Low
Town Staffing Level High Low Medium Low
Pre-requisite Town’s
contributfon
Town’s
contributfon
Other funding
partners
Transit agency
Five -Year Outlook
It is feasible that the Town may evolve the program over the duratfon of the next five years through
some form of the structural optfons noted above. These optfons each affect staffing and funding
needs, and to a lesser degree the service procurement plan for the program.
As a progression, the Town may evolve from a Town-managed approach to a third-party managed
approach, which may then eventually evolve to a JPA-managed approach. It is also feasible that the
Town could transitfon directly from a self-managed approach to a JPA-managed approach, or to a
service provided by a transit agency. There is no right or wrong progression, but rather the transitfon
should be thoughtiully approached and executed as deemed most beneficial to the program.
Additfonally, there is no “right tfme” to initfate or evolve the transitfon other than those needs and
motfvatfons that spur the Town to do so.
8. PERFORMANCE STANDARD AND PROGRAM EVALUATION
The program should be evaluated based on performance standards to be approved by the Town
Council. There are many metrics in evaluatfng school bus service and congestfon relief measures, such
as ridership, fiscal impacts, and congestfon relief as the key performance measures.
Staff is recommending the primary performance standard be subscribers as measured by average daily
passes sold. Ridership is the leading factor in the program benefits, congestfon relief and automobile
trips reductfon. Subscribers is recommended as a performance measure because it is a proxy for
ridership and program benefits, the data is readily available, and it is not affected by external factors
that are outside of the control of the Town or the customers, such as traffic patterns and weather
conditfons. Staff recommends a minimum performance threshold set at 48 passengers per bus, which
is the capacity of a standard size bus for middle and high school students.
Staff further recommends a performance target of 60 passengers per bus by the end of the pilot
period, in the third quarter of FY 2019/20. The performance target of 60 passengers per bus is used
throughout the Business Plan for ridership and financial analyses.
Town of Los Gatos
Page 10
In additfon to the number of subscribers, ridership statfstfcs will allow the Town to better understand
the use and value of the program as a traffic reductfon program and public service to the community.
Figure 2 illustrates ridership compared to the numbers of subscribers. On average, there are fewer
than 50% of the subscribers who rode the bus.
Figure 2 - Ridership vs. Numbers of Subscribers
Notes: Ridership data collected from one day/week passenger counts conducted by STA
Without knowing the specific reasons, Town staff can offer a few interpretatfons:
• The fare is relatfvely low so customers don’t see the need to use the bus every day;
• There are many exceptfons to the students’ schedule, such as doctor’s appointments and after
school actfvitfes, make complying to a bus schedule unrealistfc on a daily basis.
As ridership directly contributes to the program’s congestfon relief benefits, it is important to better
understand what will help improve the numbers. Town staff will pursue input in the upcoming
customer survey.
The subscriber and ridership evaluatfon can be prepared on a quarterly basis to allow the Council and
community to track the program’s performance and assist the Council in determining adjustments to
fares, schedule, Town subsidy, etc.
SCHOOL BUS PROGRAM BUSINESS PLAN
Page 11
Appendix A provides a discussion of several metrics for success, including transportatfon benefits,
financial sustainability, safety, service quality, staffing and responsibilitfes, and bell schedules. The
Council may wish to consider these metrics in deciding on the future of the program.
9. NEAR TERM OPPORTUNITIES
The Business Plan illustrates the high cost and challenges in contfnuing to provid e the school bus
service. Although it is the community’s desire to reduce more vehicle trips around schools, the
potentfal for ridership increase is limited due to passenger preference and the inflexible nature of the
bus service. The program’s benefits are further limited by the available funding. These factors lead to
staff to go back to the problem statement of congestfon around schools and to consider alternatfve
solutfons.
This sectfon of the Business Plan describes the preliminary concepts of two additfonal service optfon
for discussion purpose. The intent is to test the initfal interest level and seek directfon on exploring
these concepts alongside the discussion of the long-term outlook of the school bus program. The
details on cost and the steps to implement these concepts have not yet been worked out. This sectfon
illustrates each at the conceptual level and highlights the key elements of considering these models.
S ervice as VTA school trippers
The Santa Clara Valley Transportatfon Authority (VTA) provides school trippers in 16 Citfes to
approximately eight high schools and middle schools. These routes have become part of the regular
service with no cost to these citfes. These routes operate school days only and add capacity at specific
tfmes of the day when schools start and release. These services are open to the public and operate
with published tfmetables. VTA’s current youth pass is $35 per month or $385 per year and pass
holders can use all VTA services. Passengers without a pass can also ride by paying for the single ride.
In the September 2018 decision, Route C from North and East Los Gatos to High School was not
selected. A potentfal pilot can provide a similar route as a VTA school tripper, serving North and East
parts of the town and Los Gatos High School. The service can accommodate both customers on
subscriptfon plus the daily riders, which may provide a solutfon that would result in reliable ridership
and flexibility to the passengers.
As this is a different service model, it is predicated that some of the amenable passengers may not be
open to a public transit service. During the Feasibility Study preparatfon, some parents expressed
reservatfons regarding a public transit model, especially for younger students. The concept would test
the customers’ acceptance of a public transit model in comparison of the yellow school bus model. At
the same tfme, not requiring a subscriptfon can attract other passengers.
Based on the original sign up number of 150, the current market has sufficient ridership demand to
support four VTA routes at the 35 – 40 passenger capacity. Ridership for six routes is also possible as
Town of Los Gatos
Page 12
the service areas are expanded. If successfully, this service would be an affordable optfon for the
customers and a financially sustainable solutfon for the Town.
Requestfng a new service would require politfcal capital. However, this concept has a strong ridership
potentfal since the Town has completed a thorough market anal ysis. If the Town is willing to guarantee
ridership and revenue from monthly passes, it will be the first agency in the County to partner with VTA
with such guarantees to begin a new service. This will be in a stark contrast to the typical way in
startfng a new public bus service, in which the ridership is unknown and not guaranteed. In today’s
public transit environment, the Town is in a good positfon to encourage VTA to support a successful
start. This is a promising way to “expand the transit pie” by tapping into the un-served market and
getting more trips on transit.
Vanpool Incentive Program
In this model, the Town would provide incentfves to families who form vanpools that serve school trips
and reduce school-related traffic. The Town would need to establish performance standards, for
example: minimum number of passengers, for qualificatfons.
This model would have the potentfal to attract passengers in lower density areas and/or the ones
desire a higher level of flexibility. It would give customers the maximum control and relieve the Town
from most of the management responsibilitfes. However, it is a very expensive service with a lower
level of congestfon relief benefits.
10. SCHEDULE AND NEXT STEPS
March 2019 Town Council review and discusses the Business Plan
March Existfng customer satfsfactfon and future interest survey
April Develop new concepts, if directed
May School year 2019/20 final service and payment
August School year 2019/20 school bus service starts
September Return to Council with results of pursuing directfon provided in
March
March 2020 Determine the business model for the 20/21 school year and Town
funding as appropriate
August 2020 Earliest possible start date of other service models
SCHOOL BUS PROGRAM BUSINESS PLAN
Page 13
Appendix A
Technical Input to
Business Plan
Prepared by School Bus Consultants
Technical Input to
Business Plan
Town of Los Gatos
March 2019
Town of Los Gatos – Technical Input to Business Plan 2
Table of Contents
Introduction ......................................................................................................................................... 3
Program Structures ............................................................................................................................. 4
Tasks of a Transportation Program ................................................................................................ 4
Service Quality ............................................................................................................................... 4
Town Management ......................................................................................................................... 5
Outsourced Program Management................................................................................................. 5
Joint Powers Authority .................................................................................................................... 6
Staffing Needs .................................................................................................................................... 8
Peer Examples ............................................................................................................................. 10
Service Procurement Plan ................................................................................................................ 12
Funding Strategy ............................................................................................................................... 13
Market Analysis ................................................................................................................................. 15
Metrics for Success ........................................................................................................................... 17
Conclusion ........................................................................................................................................ 18
Town of Los Gatos – Technical Input to Business Plan 3
Introduction
This Technical Input to the Business Plan will focus on the future of the Town of Los Gatos’s traffic
mitigation school bus program over a general time span of the next five years starting with the kick-off
of the pilot program in January 2019. In this document, School Bus Consultants provides
recommendations pertaining to the funding, structural, and operational options available to the
program as it becomes further established in the community and grows as a service over a time
frame of the next five years.
Town of Los Gatos – Technical Input to Business Plan 4
Program Structures
This section will first provide an overview of the general tasks required to execute a successful
student transportation program. The next section will discuss three viable structures for the Town to
operate and manage this transportation program. The advantages and disadvantages of each will be
discussed at a high level based on industry experience including knowledge of the operating
structures of similar programs in the Bay Area including the Lamorinda School Bus Program and the
TRAFFIX program in San Ramon and Danville. Subsequent sections will provide further context on
staffing needs, service procurement, and funding as they relate to the three structures.
Tasks of a Transportation Program
In order to provide a traffic-mitigation school bus program to the community, the Town must engage
in a high level of program management. The tasks related to a successful and effectively managed
program can be summarized into the following categories:
1. Operations: This includes the contracting of a school bus operator that will provide the Town with
buses, drivers, bus operations management, and maintenance functions. The Town must oversee
the work of this contractor on both a daily operational basis as well as a long-term contractual
level.
2. Planning: This includes the development and adjustment of routes. Work related to planning is
highest when new routes are designed, or yearly adjustments are made before the start of a
school year or semester. Adjustments to routes may need to be made at an interim basis during a
school year due to traffic issues and the requests of new or alternative bus stops.
3. Communications and Customer Care: The Town will need to engage with the schools and
districts representing the stakeholders to which it will provide services. This again requires a daily
operating function to handle escalated service issues or student behavior problems. Many daily
service-related inquires and issues should be handled by the school bus operator yet is likely that
key decisions will need to be made and communicated to stakeholders by the Town. Furthermore,
long-term service planning tasks related to adjusting bus arrival times and new routes will need to
be communicated to the various stakeholders.
4. Administrative: The Town must plan for the administrative management of the program,
engaging with the Town Council and community regarding the program’s status, recruiting
ridership, and processing sign-ups and payments.
Service Quality
The proper execution of the previously described phases of program management are critical to a
high level of service. Service quality is important to any school bus or transit operation, but is of even
greater importance to a premium, parent-paid service. High service levels in which routes are
deployed in a safe, dependable and timely manner will help the program retain current riders and
bring in prospective riders. Inversely, poor performance over time may damage the reputation and
longevity of the program. It should be stated that issues will arise on a periodic basis such as a late
bus due to traffic or an occasional missed stop and the program should not be expected to be perfect.
However, persistent issues that are not addressed through operational and planning adjustments in
any given management structure will jeopardize the program as a paid service. Thus, the success of
this program will depend greatly on proper management.
Town of Los Gatos – Technical Input to Business Plan 5
Town Management
The Town has several options for how to structure the program and oversee the operational,
planning, communication, and administrative responsibilities inherent in a school bus program. The
option to utilize and increase Town staff resources to oversee the program duties will be the initial
framework for the pilot program. SBC considers utilizing current staff and/or the hiring of additional
staff, contracted workers or interns to perform these duties as part of a Town-managed structure.
Among all options, the contracted school bus operator will oversee many duties such as driver
dispatching, fielding bus location inquiries, maintaining buses, and staffing drivers. In this structure,
Town staff will be engaged with all administrative, communication and contractor oversight duties.
Oversight of the operational duties is typically a daily task that at times (and especially during the start
of the school year or when routes are changed) will become substantially time consuming. Issues that
will likely become Town responsibilities include but are not limited to: persistently late buses, student
behavioral issues, bus accidents, and escalated complaints.
Advantages:
• Utilizing current salaried employees to perform planning and administrative tasks can reduce
program costs allowing current Town employees to use their various skills to support the school
bus program.
• Can utilize contracted, part-time or full-time employees to oversee operational and communication
functions with lower overall program costs. As skills, needs, and time allows, contracted
employees may also assist with tasks for other Town projects. This has been observed in similar
program models.
• Keeping the program under the Town allows for more direct control of goals and service levels.
Disadvantages:
• As the program grows Town staff may be over-burdened with school bus related work and not
able to perform other Town tasks, or inadequate oversight of the program could result in lower
service levels.
• Town staff may not have a full range of experience with school bus transportation to adequately
manage a program and ensure high service levels during the pilot period and beyond.
• Part time contract employees may be less likely to remain in their position as they seek full time
work and benefits. This can result in position turnover that can affect program management.
• Program costs are managed and shouldered by the Town only.
Outsourced Program Management
The option exists for the Town to contract with an entity to manage all administrative, communication
and oversight responsibilities for the school bus service. Town staff would still be engaged at the
highest level of oversight, with responsibility for ensuring the management service provider is
performing satisfactorily as well as acting as the high-level decision maker under the direction of the
Town and its Council. There would also be some level of contract and performance management
responsibilities in this scenario, focused on the management vendor and how well it was fulfilling its
responsibilities. All responsibilities would be minimal compared to the Town-managed model. While
most liability could be effectively distributed down to the management company and school bus
contractor, the Town would still bear some responsibility and potential liability for the service.
Town of Los Gatos – Technical Input to Business Plan 6
Advantages:
• School bus industry and technical experience is gained through a service management entity.
• Outside resources and experience are available to the local staff under the service management
entity.
• The direction and final decision making will remain with the Town at a high level, while daily
functions are delegated.
Disadvantages:
• The Town has less direct supervision on service levels and quality at a day to day level.
• Program cost control could be limited due to less oversight of route planning.
• A separate service management contract may result in comparable program costs to a Town-
managed program. Costs of an outside service provider would need to be analyzed on a case by
case basis to establish any relative cost increase or decrease and the associated value of utilizing
each service provider.
• It may be challenging for the Town to identify qualified program management service providers
who have the range of expertise necessary to perform all required duties.
Joint Powers Authority
As the program grows, another option that exists is to transfer the authority and management of the
program to a Joint Powers Authority (JPA) organization in which the Town would be one of several
participating members. This structure would result from engaging partner counties, school districts,
schools, municipalities and/or other partner agencies who are current or future stakeholders of the
program. Under a JPA, the program management would fall under the supervision of a member
board that would hire staff to perform all administrative, communication, and operational duties. It is
possible that an outsourced management system could be contracted by the JPA as well. Under a
JPA structure, Town staff would likely only be involved as a member of the JPA board.
Advantages:
• Additional monetary resources are available to help the program grow and relieve the Town of full
financial responsibility.
• Program oversight at a high level is shared among multiple agencies via a board.
• Program management will be given to employees of a service management agency under the
authority of the board.
Disadvantages:
• The Town loses direct oversight of the program and its service levels.
• The Town must share decision making with other entities with potentially different goals than the
Town.
• Each member agency may want to shift resources and program focus to receive a larger portion
of the program’s services.
• The overall decision-making process has been observed to take longer due to the logistics of
convening members from multiple agencies for board subcommittee meetings. This may lengthen
planning efforts and require more administrative time for staff.
Town of Los Gatos – Technical Input to Business Plan 7
It is feasible that the Town may evolve the program over the duration of the next five years through
some form(s) of all three structural options. The above options seek to illustrate the various structural
avenues available and the considerations that should be made towards them. These options each
affect staffing and funding needs, and to a lesser degree the service procurement plan for the
program.
As a progression, the Town may evolve from a Town-managed approach to a third-party managed
approach, which may then eventually evolve to a JPA-managed approach. It is also feasible that the
Town could transition directly from a self-managed approach to a JPA-managed approach. There is
no right or wrong progression, but rather the transition should be thoughtfully approached and
executed as deemed most beneficial to the program. Additionally, there is no “right time” to initiate
and/or evolve the transition other than those needs and motivations that spur the Town to do so.
Town staff has indicated to SBC that it is willing and able to initiate and manage the program through
the pilot phase and potentially beyond but would like to transition the management of the program to
a third-party or JPA-managed structure as soon as possible and no later than five years into the
program. This time frame is both feasible and prudent, and the Town should proceed at its desired
pace to accomplish this transition.
Town of Los Gatos – Technical Input to Business Plan 8
Staffing Needs
The Town’s current plan is to initiate the pilot service with a Town-managed structure. The Town
intends to hire a contracted half-time employee to manage the operational, administrative and
communication duties of the program. This contracted employee is slated to be assisted by a Town
staff member as well as a Town intern. For the initial two-route pilot program, SBC believes this level
of staffing is feasible with the Town’s understanding that the standing-up of the program will require a
higher level of effort than ongoing operations once the program is established and executing. On the
weekly average though, SBC believes this can be done through a total of 40 applied hours a week.
SBC advises that under this structure the contracted employee perform the tasks of program
management, including managing the service operator, daily communication with schools, program
enrollment, and invoicing and payment processing. Town staff can be involved with council and
district level communications, program planning, and contract management. These assignments
allow the contracted employee to perform more daily operational management duties, while staff
perform long term planning and program management level duties. Should these tasks require more
time by the contracted employee or the Town staff member, SBC recommends that the Town be
ready to increase the hours of the contracted employee as needed and feasible given budget
limitations or be prepared to utilize Town staff to a greater degree.
An increase in staffing resources will be needed should the number of program routes increase.
While an increased number of routes will not directly increase work for all program management
functions, such as route planning duties and high-level communication duties, the functions of
invoicing, payment processing, and school-level communication will all grow substantially based upon
the number of routes, students and schools added to the program. It should be noted that theoretical
increase of three routes added to an existing school served by the program would not materially
increase the communications with school staff, but it would materially increase the invoicing and
payment processing needs for the program.
It should be noted that resource needs associated with student sign-ups, invoicing and payment
processing may vary based upon the technology used for these functions. Strategically employing
applicable software may allow these tasks to be performed more autonomously through an online
portal which would reduce the need for Town staff to process enrollment. Conversely, the number of
employee hours increases given the program’s rules regarding sign-up and payments. More work will
be involved if enrollment occurs year-round and/or if families can cancel membership mid semester.
This variability to the enrollment structure benefits the program by attracting parents and riders who
desire more flexibility in order to use the bus services. The Town will need to balance the provision of
program enrollment structures that attract more customers, and the increased costs in administrative
time to run a flexible system.
To summarize the preceding discussion on staffing needs, the following Table 1 is given as a general
scale in the number of working hours needed to manage the program based on the number of routes.
Initial demand on staff is likely to be higher. Table 1 represents the staff resources needed for an
established program. These estimates are based on SBC’s understanding of the management
practices of similar programs in the Bay Area such as Lamorinda, and TRAFFIX.
Town of Los Gatos – Technical Input to Business Plan 9
Table 1: Staffing Needs per Program Route
Routes Recommended Weekly
Staffing Resources Potential Staffing Composition
1 - 4 40 hours 20-30hr part time contacted employee +
10-20hr Town staff
5 - 8 40 - 60 hours
40hr contacted employee, + possible
20hr Town staff OR 20hr part time
contracted employee
9 - 12 60 - 80 hours 40hr contacted employee, + 20-40hr
contracted employee
13 - 24 80 hours Two 40hr contacted employees
Provided below in Table 2 is a breakdown of time dedicated to different tasks over a school year.
This understanding is based on industry experience and the structures off both Lamorinda and
TRAFFIX. The underlying trend is that the focus on operations is greatest at the start of a school year
with less focus on planning except to adjust routes with issues. Planning time increases at the end of
the school year to make changes to the next year’s routes. Communications is an important task at
the start of the school year to support daily operations and continues to be an important task as
planning becomes a focus and higher-level changes need to be arranged with school and district
stakeholders. Administrative duties exist throughout a school year yet are often minimized during start
up periods.
Table 2: Percentage of Staff Time on Tasks during a School Year
Tasks Fall Winter Spring Summer
Operations 60 percent 50 percent 30 percent 10 percent
Planning 5 percent 15 percent 25 percent 40 percent
Communications 30 percent 20 percent 20 percent 25 percent
Administrative 5 percent 15 percent 25 percent 25 percent
Total 100% 100% 100% 100%
As previously noted in the Program Structures section of this document, it may be challenging for the
Town to obtain staff that can adequately fulfill the range of skills noted in Table 2 and that are
necessary to run a growing school bus operation. Seasoned workers in the school bus industry will be
able to execute the tasks of operations supervision, communication and some planning duties, but
may be limited in marketing the program (an important aspect of communications during the pilot
Town of Los Gatos – Technical Input to Business Plan 10
program) and performing board related and financial administrative duties. It has been observed that
other programs have focused on staff that have stronger marketing and communication skills
necessary to promote and expand a program but may not possess industry operational knowledge.
The part time staff focused on operational tasks will therefore likely need to be supported by Town
staff (see Table 1) to perform the needed administrative tasks during the pilot program period. As the
program grows and an additional full-time or part-time dedicated staff is added to the program, the
Town should ensure that a complementary mix of administrative, communication, planning and
operations skills are provided for on the team.
If the Town was to decide that it no longer wanted to manage the program itself and moved to
contract out those responsibilities to a management company, then the management service provider
should analyze its own staffing needs to fulfill the assignment as part of its contract bid. The above
table could then be used by the Town to determine the validity of proposed staffing resources as
specified by the management service provider. Additionally, high-level administrative duties and
decision making would still need to be performed by Town staff and should be accounted for within
the Town’s budget and staffing estimates. Furthermore, should the Town enter a JPA, then the JPA
would likely need to staff the program at a similar or higher level to account for the increased board-
level administrative needs and duties.
Regarding staffing costs, SBC understands the costs savings in utilizing staff resources that are
already engaged in other Town duties as well as utilizing part time contracted employees. Both
options minimize the overhead costs to the program. As the program grows, however, it will
eventually necessitate full-time staffing resources which will likely incur benefits and/or wages to
cover contracted employee benefits. These increased program costs will likely benefit the program in
attracting and retaining qualified staff. Since the demand of a school bus program fluctuates
throughout the school year, it may benefit the Town to strategically assign program staff to other
Town duties in order to balance out the costs to the school bus program and other Town functions.
Under a JPA structure, the capacity to leverage the program staff to work on other functions would be
limited. Furthermore, JPA staff would likely not be allowed to utilize existing Town benefits structures.
A JPA structure, therefore, may result in higher staffing costs.
Peer Examples
As previously discussed Lamorinda and TRAFFIX provide potential examples and lessons learned on
how to staff and structure a traffic mitigation school bus program. Though each program is similar in
size and under the authority of a JPA, the nature of their operational oversite is different. Lamorinda
has a 22 bus, 1500 student operation and is managed by one full-time program manager and a full-
time administrative assistant. Both employees spend a portion of their yearly time on another program
for the city of Lafayette, a member of the Lamorinda JPA. SBC estimates that both employees spend
70 to 80 percent of their time performing work for the Lamorinda bus program; equating to an
estimate 1.5 full-time equivalents (FTEs) to oversee the program.
TRAFFIX has a 23 bus, 1700 student program and has historically employed 1 contracted full-time
manager to fulfil the oversite duties of their program. This is supplemented by staff members of the
various agencies in the TRAFFIX JPA who assist the contracted employee with administrative and
planning duties. Thus, the TRAFFIX program is being overseen by an estimated 1.25 to 1.5 FTE’s
with an assumed cumulative contribution of 0.25 to 0.5 FTE’s from the staff members of the JPA
agencies. Table 3 summarizes these staffing arrangements of both Lamorinda and TRAFFIX.
Town of Los Gatos – Technical Input to Business Plan 11
Table 3: Staffing Arrangements of Peer Programs
Program Current Riders /
Routes / Schools Weekly Staffing Resources Current Staffing Composition
Lamorinda 1,500 riders / 22
routes / 12 schools
65 to 80 hours depending on
time of year
Two 40hr contacted employees
(spend a small portion of time on
another city program)
TRAFFIX 1,700 riders / 23
routes / 11 schools 40 - 60 hours 40hr contacted employee, + 10-
20hr from staff of JPA agencies
The above description and estimation of FTE’s shows that each similar sized program requires 1.5
FTEs to oversee their program’s work. The major difference is Lamorinda has dedicated staff to
oversee this work while TRAFFIX must rely on additional resources from the JPA member agencies.
Though SBC does not claim to know all the facets of either structure’s successes and drawbacks, it is
SBC’s observation that the Lamorinda management structure has been more successful in employee
retention and program oversite. The TRAFFIX model with only 1 dedicated FTE has resulted in
position turnover and extended reliance on staff of the JPA organizations to oversee the program.
To address historically high turnover and the difficulty of finding an employee with a full range of
necessary skills, TRAFFIX has entered a Memorandum of Understanding with the city of San Ramon
(a JPA member) to have the TRAFFIX program be managed by an administrative coordinator under
the direction and employment of the city’s Transportation Division Manager. This move was likely
executed to provide stability, direct oversite, and enhanced benefits to the TRAFFIX coordinator in
the hope of attracting and retaining a highly qualified employee. It further provides increased FTE’s to
supervise the program. SBC presumes that this move will result in a dedicated 1.25 to 1.75 FTE’s to
oversee the program, whereas historically this supplementary assistance was shared by the JPA
agencies on a rotating basis. This underscores SBC’s staffing recommendations in Table 1 which
demonstrate that one FTE is only sustainable for up to 4 to 5 routes.
Within Marin County there are three school bus programs with the focus on traffic reduction that are
managed by Marin Transit. Each has a different oversight structure with Reed Union organized as a
JPA of the Town of Tiburon and City of Belvedere; Mill Valley established by the district, and Ross
Valley established directly by Marin Transit. Each of these constitutes a different oversight structure,
with which SBC is less familiar regarding day to day needs. These programs have therefore not been
included in this peer analysis. SBC would presume, however, that the staffing levels within each
agency are significantly lower than Lamorinda and TRAFFIX as their duties are limited to high level
administrative tasks and since Marin Transit is handling management tasks of communications,
planning, and most substantially, operations.
Town of Los Gatos – Technical Input to Business Plan 12
Service Procurement Plan
The Town of Los Gatos has already executed the process of developing and posting an RFP for the
contracted services of a school bus operator. SBC participated in this process at an advisory level
through the review of the RFP development, solicitation and proposal review processes. As was the
case in the most recent RFP process, the scope of service should always be variable to allow for
growth in the number of routes both during and after the pilot period. The Town’s goal for the program
is that ridership demand and its success at relieving traffic congestion will create an ongoing need for
more routes. An RFP should be structured to accommodate for a substantive increase in the number
of routes, as needed.
Over the program’s contractual periods with school bus operators, it is advised that the Town monitor
and track the service quality of the operator through established contract and performance
management methods. Employing strong contract and performance management practices will
ensure the highest quality of service as well as give the Town an accurate and fair measurement of
the service operator when the next instance of competitive bidding comes around. Contract
performance measurement can include tracking of bus arrival times, compliance monitoring of the
contractor's driver records, and ensuring proper communication between the contractor and the
Town.
Either during the pilot or during the early years of the established program, there will come a decision
point to renew with the current school bus service provider or go out to bid. SBC recommends making
these decisions with the use of the aforementioned contract and performance management practices.
If services have not been historically satisfactory with the current vendor, then it will likely be best to
once again bid out the work. If historical services have been to the Town’s satisfaction, however, then
a negotiated renewal approach may be more beneficial to all parties, especially if the number of
routes remains below 10. Should the program begin to grow larger than 10 routes, then regardless of
past contractor performance it may be beneficial to once again engage in a competitive bidding
process. If/as the program grows in size and scope, it may very well attract more service providers in
future competitive bidding efforts. This reality could result in more completive contractor pricing as
well as enhanced competition that leads to superior service levels. However, this does not guarantee
costs will not go up overall as the costs of school bus services have seen a dramatic increase to
larger-scale (i.e. Lamorinda and TRAFFIX) programs in the region by as much as 20 percent.
Finally, should the program evolve into a JPA, it is likely that a new contract would be needed
between a school bus contractor and the JPA. This ensures that the full responsibility and authority
resides with the JPA rather than the Town.
A final element to be aware of regarding service procurement is the availability of school bus
operators. Operating a school bus company involves a large amount of capital; a large inherent
liability in providing services; and the challenging task of maintaining an adequate number of certified
drivers in a competitive market. Together these factors have historically reduced the number of
operators in any given region or city within the U.S. This reduction in the number of qualified
operators can make it difficult for public entities to procure services and at competitive rates.
Town of Los Gatos – Technical Input to Business Plan 13
Funding Strategy
The Town is currently using its own General Fund to resource the pilot program along with parent
contributions. Based on feedback from surveys, it was determined that the community would be most
interested in participating in the program at the lower end cost of $350 per academic year. A higher
share of program funding will therefore need to be shouldered by the Town. During the feasibility
study, county measure dollars and grants have been pursued but have yet to result in concrete
additional funding sources. These funding sources should absolutely be pursued throughout the pilot
and beyond for the program’s duration, but not relied upon as stable sources of additional funding.
In the case of similar programs, TRAFFIX and Lamorinda each rely on a specific Contra Costa
County measures to fund a predominant portion of their programs’ operating expenses. The rest of
the program’s funding comes from per student parent contributions. Marin County programs are each
funded via a combination of County funds (supported via Marin County Measure A), local city funds,
and parent contributions. Though these programs have been successful models for several years,
multiple factors can place their programs in difficult financial situations:
• Variable County measure funding: Both the TRAFFIX and Lamorinda programs rely on Contra
Costa County Measure J funding. Funding for Measure J is based on a half cent local sales tax
that is distributed to many programs including the two school bus programs previously mentioned.
The County measure provides an estimated $90.9 million to be provided to “Safe Transportation
for Children” over 25 years resulting in an estimated $1.06 million per year for Lamorinda and
$1.6 million per year for TRAFFIX. However, tax revenues can fluctuate over the 25-year time
span of the measure. Furthermore, the measure could end in 2034 without a replacement
measure or new funding source. Measure J requires that programs establish a 3 percent reserve
annually to cover potential dips in sales tax revenue. Marin County programs have been in
existence for a shorter period time. Measure A funding that support these programs is subject to
renewal as was the case in 2018.
• Increase in program operating costs: It is common practice for school bus transportation
service vendors to build in yearly inflation cost increases as part of their service contract. In the
case of the current contact the Town will see a 3 percent (and in the last year 4 percent) yearly
increase of the contract cost. Beyond this inflation-based increase, costs for school bus services
may rise between contract periods. This can occur even when new RFP’s are created to seek
competitive bids from service providers. Though in no way the only factor, recent service costs
have likely increased for most vendors due to the need to pay drivers higher wages and benefits
to compensate for cost of living increases and in order to retain and recruit drivers during a strong
economy. This effect is even more pronounced in major US cities.
• Potential limitations in increasing parent contributions: Increasing parent contribution per
rider can offset increased program costs yet is subject to a loss in overall ridership should the per
rider price become higher than the community’s tolerance. Though small increases to ridership
fares is both likely and necessary over time, major price increases are typically met with
community push back and frustration. For example, to avoid increasing parent contribution to all
riders, Lamorinda has approached route consolidation in order to mitigate increased operator
costs. This tactic is more achievable in a larger operation that services multiple schools and grade
levels. Thus, it may be a solution in the future if the Town is operating numerous routes and must
find a way of reducing costs without drastically increasing ridership fares or eliminating service
completely.
Town of Los Gatos – Technical Input to Business Plan 14
The variability and current lack of grant measure funding may put the Town in the position of needing
to dedicate resources to not only a pilot, but the established program itself. As seen in the Marin
County programs, local contribution can be part of the base funding structure. SBC recommends that
this potential liability be clearly understood and accepted by the Town and its Council as it moves
forward and evaluates the success of the program. Should the Town continue services past the pilot
period, a consistent and reliable funding source that can increase with likely service cost increases
will be critical to the program’s longevity.
To secure further funding for the program’s growth, it may be advantageous to the Town and other
public entities to join together as partners in the school bus program. Potential partners include
municipalities whose residents will benefit from utilization of the school bus services, as well as
counties, school districts, schools, municipalities and/or other partner agencies that benefit from the
regional traffic reduction. As the program grows, the number of routes could be increased to service
more than just schools located in the Town of Los Gatos: thus, reducing regional traffic in neighboring
municipalities. School districts themselves could become viable partners given the success of the
program as well as existing school busing programs in the region. This partnership in the form of a
JPA can allow the costs to be shared amongst all stakeholders who benefit from the services. This
partnership could stabilize the funding sources of the program as well as give the stakeholders more
say in the direction of the program and how funding is divided. If measure and grant funding are
acquired, then the cost to each member could be reduced. A larger JPA program may also be able to
attract more measure and grant funding as an established and growing entity in the region.
Town of Los Gatos – Technical Input to Business Plan 15
Market Analysis
A school bus program focused on traffic mitigation has a unique business focus and therefore a
distinctive market. Where normal school bus programs seek to provide transportation to all interested
student riders residing at a given distance from the school, a traffic focused program must add in the
focus of targeting theses services to those areas where traffic congestion may be reduced the most.
An additional layer of complexity is added via a paid program where providing an attractive and
beneficial service is also a necessary parameter. The feasibility study undertaken by the Town and
SBC during the Spring/Summer of 2018 shows that with all these parameters the initial interests in
the community for the program was 335 student riders. As of the beginning of the pilot program in
January 2019, the paid enrollment was 102 riders. Not all 335 were provided a viable transportation
option at this time given that only 2 routes were offered during the pilot program.
SBC believes that these 2 routes servicing 4 schools is an adequate starting point for the program to
grow. This averages to 51 riders per bus, a strong starting point considering the average maximum
bus capacity for a secondary school is 48 students, and the average maximum capacity for an
elementary school is 72 students.
The below Table 4 is a comparison of peer programs in the Bay Area with an assessment of the
current program size in relation to the student enrollment sizes. From this assessment the Town can
begin to understand the potential growth and market potential for their similar traffic program. The
percentage of riders per enrollment averages to 10 percent if the outlier of Reed Union is removed
(Reed Union considered an outlier as there was limited data on the ridership figures of the district).
Various elements factor in to this 10 percent average ridership population of the available enrollment.
Limiting factors to ridership include students residing within proximity to school, preference of other
transportation methods, similar mountainous geographies where buses cannot reach all students,
limited service times, and the focus of program routes on areas that benefit traffic congestion relief.
Table 4: Comparison of Peer Program’s Service Levels and Ridership
Program Funding Source Year
Started
Current Riders / Routes /
Schools
2017/18
Enrollment at
Distiricts Served
Ridership as
Percentage of
Enrollment
Lamorinda County Measure J
Ridership Fees 1994 1,500 riders / 22 routes /
12 schools 13,628 11 percent
TRAFFIX County Measure J
Ridership Fees 2009 1,700 riders / 23 routes /
11 schools 32,504 5 percent
Marin County:
Reed Union
County General Fund
Local City
Ridership Fees
2016 635 riders / 12 routes /
4 schools 1,444 44 percent
Marin County:
Ross Valley
County General Fund
Local City
Ridership Fees
2016 401 riders / 10 routes /
3 schools 2,094 19 percent
Marin County:
Mill Valley
County General Fund
Local City
Ridership Fees
2016
Pilot continuing:
140 riders / 3 routes /
3 schools
3,086 5 percent
Town of Los
Gatos
Town Funding
Ridership Fees 2019
Pilot continuing: 104
paid riders as of Jan
2019 / 2 routes /
3 schools
5,263 2 percent
Town of Los Gatos – Technical Input to Business Plan 16
Last row changed to 113 paid riders/2 routes/4 schools, enrollment 5,155, 2.7 percent
Should this assessed 10 percent ridership average amongst peer programs be applied to the Town of
Los Gatos enrollment population, a potential 526 riders are feasible. The Town hopes to reach five to
six routes at the fifth year of the program. At an average of 60 riders per route, a five to six route
program could service 300 to 360 students. This would constitute 5 percent to 6.5 percent of the
enrollment population. This may likely be the limit of the Town considering the proximity of many
families to their respective schools. Should the Town seek to reach the theoretical 10 percent
ridership mark with five or six routes, an effective strategy would be to reuse buses amongst two tiers
of service in both the morning and afternoon. Reusing a bus twice in a service period would double
the potential capacity and therefore funding. Effective bell tiering allows for this reuse of buses and
has been employed in Lamorinda and TRAFFIX. Therefore, in order to best achieve a greater portion
of the market with a limited number of resources, bell time coordination in the community will be
necessary. This may be an endeavor to discuss with the Town’s partner districts at the pilot stage as
interest in the programs grows.
Town of Los Gatos – Technical Input to Business Plan 17
Metrics for Success
During the pilot and following its establishment as an established service to the community, the
strength and merit of the program should be evaluated on several levels. The tracking of the program
on these levels will prove to current and future stakeholders the value of the service to the community
and its main goal of traffic reduction. Categories to evaluate and track include but are not limited to:
1. Program Enrollment and Ridership: Tracking the number of students/households that enroll in
the program as well as daily, weekly or monthly ridership figures (variable based on operational
capacity to track these figures). While enrollment numbers carry higher value in terms of funding,
ridership statistics will allow the Town to better understand the use and value of the program as a
traffic reduction program and public service to the community.
2. Transportation Benefits – Congestion Relief and Automobile Trips Reduction: Tracking the
reduction of traffic congestion at the most impacted locations around school campuses during
peak commute times will establish the program’s value towards the goal of congestion relief.
Tracking the school-related automobile trip reduction will measure the local and regional
transportation impacts and regional air quality benefits.
3. Financial Sustainability: Utilizing the pilot to understand the true operating and administrative
costs will assist in projecting future costs should the program continue and expand
4. Safety: Tracking safety is a best practice of any school bus operation, and such measurements
will help engender the service as a strong alternative to personal vehicle transportation.
5. Service Quality: As mentioned previously, measuring quality of the service will ensure that the
service provider is performing to both Town and community expectations.
6. Staffing and Responsibilities: The number of hours and the effectiveness of the time spent
managing the program by Town staff and contracted employees should better inform future
staffing needs should the program continue and expand.
7. Bell Schedules: It is highly recommended that as the program continues to grow, bell schedules
of the program associated schools be evaluated for adjustments as to better accommodate school
bus transportation. Schools may be able to share transportation services should their bell times
be ideally offset and aligned for early releases and/or late start days. Additionally, bell schedules
can be adjusted so that one bus can perform two to three tiers of service to multiple schools
during both morning and afternoon service periods. Bell schedule driven adjustments would also
allow the program to increase ridership and therefore funding for the program.
Town of Los Gatos – Technical Input to Business Plan 18
Conclusion
School Bus Consultants believes that the current enthusiasm for the traffic mitigation school bus
program will continue to grow with the start of the pilot in January 2019. This initial period will provide
the Town with crucial understanding of staffing needs, program demand through waitlist and
ridership, and service quality. SBC believes the current staffing plan of one contracted employee
assisted by Town staff will suffice for the initial pilot period. However, SBC advises the Town to be
flexible with early start-up demands and the potential to increase the contracted worker to 30 hours or
beyond if needed.
As the program becomes more established and grows in the number of routes servicing the Town,
SBC sees strong potential for a JPA to be formed with regional stakeholders. A critical reason for this
is the security in funding from a network of partners. This partnership may further benefit the Town in
relinquishing itself from management duties, yet this change does come with a loss of direct control
over the program’s future. Further caveats to a JPA structure are the increased levels of board
oversite on all decisions and the potential for lingering liability as a JPA member. These caveats
being stated, SBC believes that the Town should work towards a successful program that can be
promoted though the tracking of its traffic mitigation and value-add to the community. This value will
create community buy-in and potential partnerships from which a JPA can be created and a growing
program can be sustained.
For Questions or Comments:
Patrick D. Kneib
p: (843) 410-6743
e: pkneib@schoolbusconsultants.com
Ian M. Jones
p: (818) 617-9703
e: ijones@schoolbusconsultants.com
www.TransParGroup.com