City to discontinue shared ride taxi program in 2025

With costs rising and ridership dwindling, the Rhinelander Common Council has exercised its option to end the city’s contract with Running Inc. (the current provider) and discontinue the shared ride program. Shared Ride is a program funded by both state and federal dollars that provides a shared ride taxi service in rural communities, city finance director Wendi Bixby explained in a memo to the council. 

“Every five years the City is required to complete a procurement process to solicit a taxi service provider by posting an RFP (request for proposals) for a two-year contract with three option years,” Bixby explained. “The service hours and original hourly service rate to the provider for the first two years are set with the RFP and award of the bid. The City can exercise its option to continue the service for each option year with the taxi service provider for their current year’s hourly rate adjusted for the August CPI. The City received the exercise for options form for 2025 with a CPI increase of 2.5%. If the City exercises its option to continue the shared ride program for the third option year, Running Inc. will be guaranteed up to $826,664.28 based on the hourly rate of $32.51/hour for up to 25,428 hours of service. The City can choose to not exercise its option and discontinue the shared ride program. The City of Rhinelander’s 2024 grant agreement is for $259,784 federal funding, $178,723 state funding, and estimated local share of $29,319. The goal of the program has been to operate with a zero local share. The federal funding is 32% of the expenditures. The state funding for 2024 is 54.7% of the expenditures and varies a little bit each year. The amount of expenditures reduced by the estimated passenger revenues and reduced by the federal and state funding is the local share. If the shared ride has an increase in revenue or a decrease in expenditures, there is a reduced estimate for local share. The City was very fortunate to receive additional ARPA funds through the federal grant agreement for 2020-2023 to cover the local share. Running, Inc. assisted the City in implementing an agency fare effective 7/1/2021, which increased revenues. Based on 2021 passenger trips, Running, Inc also assisted in calculating a passenger rate increase of $1.25 to all passenger fares approved by council late in 2022 for an effective date of 1/1/2023. The estimated revenue for 2023 was $344,000 based on the increase and used in the 2023 and 2024 applications. Unfortunately, the actual passenger revenues have been $260,925 in 2021, $281,146 in 2022, and $280,546 in 2023 with a projection of $269,277 in 2024. Even though the rates have increased, the passenger trips have decreased. There were 59,349 passenger and 785 agency trips in 2021, 51,944 passenger and 5,376 agency trips in 2022, and 41,508 passenger and 7,461 agency trips in 2023. The reduced passenger trips is due in part to difficulty filling the third shift position, but this also reduced the expenditures for service hours, which assists with reducing the local share. Another reason could be the presence of alternate taxi services in the area including Northwoods Transit Connections and Hodag Cab Company. The City will need to either exercise the options to operate the shared ride taxi service in 2025 or notify WisDOT soon after the 10/14/2024 council meeting if it will be discontinuing the program.”

Using $300,000 as an estimated passenger revenue, Bixby calculated the local share for 2025 to be an estimated as $76,563.

After hearing that the Hodag Cab Company, and potentially the Northwoods Transit Connection, can pick up the slack for riders, the alders opted to discontinue the program.

Bixby did note that the city does have the option of resuming the program in the future.

“If we discontinued it, we could continue it back again. We could apply again. We just have to give them a year’s notice,” she said.

In other business conducted during its Oct. 14 meeting, the council also approved a new policy for contacting city attorney Steve Sorenson. 

City administrator Patrick Reagan suggested the idea as a cost-saving measure.

“As we have been working through the budget process, it has been made apparent that our General Fund is facing tighter and tighter constraints each year, which means that the City needs to find various ways to better control expenses,” he wrote in a memo to the council. “One expense that can be better managed is that of utilizing the City Attorney. The Attorney, as he does with every municipality, has a rate of $295 per hour. Over the past year, City staff has an unwritten policy that, if a staff member believes they need to contact the attorney with an issue, they speak with the City Administrator first to determine if the issue can be solved prior to incurring the additional expense. As you will see in the document attached to the resolution, this has proven to be a cost saving from 2022 to 2023. Obviously, a lot of factors can have an impact on this expense, but we have found it to be one way to cut costs. Furthermore, this has been a standard policy in the other communities that I have been the City Manager, so this is not any sort of experiment or wild idea. Basically, this policy (contained in the resolution) states that the Mayor, Council President, City Administrator, Fire Chief, and Chief of Police are authorized to contact the City Attorney. The Fire Chief and the Police Chief are included due to the fact that they have been empowered to issue municipal infractions and, therefore, have a much greater likelihood of needing to speak with the City Attorney. Also, the Fire Chief and the Police Chief would be authorized to contact the City Attorney with matters related to issues within their own department only. Finally, this proposed policy still allows the City Attorney to be contacted by any official or employee if they have questions, comments, or concerns related to the City’s Ethics ordinance.”

The alders accepted the rationale and approved the policy.

David Holt, the longest-serving member of the council, spoke in favor of the policy.

“This is an issue that predates this council,” he said. “I can say that very factually. So in terms of policy, to me, we're not pointing fingers. We’re trying to establish policy. Policy goes past two-year election cycles. So it’s not about anybody individually. It’s about trying to create better policy for taxpayers. And this has been an issue that I’ve tried to raise since I’ve been on council, is that the length of time of meetings, for example, has a cost to it. The way we conduct ourselves has a cost...”

Heather Schaefer may be reached at [email protected].