WAVE: $ 700,000 loan required by Wilmington and New Hanover or operations will stop in three weeks
Update 5 p.m. – This article has been updated to include comments from the Wilmington Metropolitan Planning Organization. It has also been updated to note the Executive Director of WAVE Alberty Eby issued a press release denying that WAVE plans to suspend the service; Eby declined to address the email sent by WAVE’s CFO to Wilmington and New Hanover County, to which Eby was copied, which explicitly stated that WAVE would be “forced to suspend operations” without a loan.
WILMINGTON – WAVE informed city and county officials that without a loan or cash advance of $ 700,000, it would be forced to suspend operations in mid-February. WAVE stated that this was a further shortfall, in addition to previous financial difficulties, and that it resulted from a delay in funding the grants which is “not the fault of the Authority. “.
WAVE said the shortfall was due in part to a delayed funding request by the Wilmington Metropolitan Planning Organization (WMPO) as well as continuing financial difficulties from the North Carolina Department of Transportation. (NCDOT). WMPO denies that its request was “delayed”.
WAVE also said it needs a loan, not new funding, and still expects to receive delayed state and federal grants.
New Hanover County confirmed Thursday that the Cape Fear Public Transportation Authority (WAVE) informed the county and Wilmington financial offices of the situation on Tuesday, January 21. The county and city are currently “determining the next steps and the way forward.”
WAVE did not indicate in its request the amount of the $ 700,000 it was requesting from Wilmington and NHC individually.
WAVE has faced increasing financial difficulties over the past year; recently the Authority reduced hours of service to remedy a pre-existing problem $ 745,000 deficit. Earlier this month, New Hanover County President Julia Olson-Boseman and Wilmington Mayor Bill Saffo announced WAVE would be restructured. While Saffo was more positive about WAVE’s performance, Olson-Boseman said the restructuring would include, in her mind, the liquidation of the current board and administration, saying she had “no confidence In the leadership of WAVE.
$ 1.2 million in deferred funding
The email sent Tuesday afternoon from Joseph Mininni, WAVE’s director of finance and administration, to New Hanover County CFO Lisa Wurtzbacher, and Wilmington Deputy CFO Bryon Dorey.
“On behalf of the Cape Fear Public Transportation Authority, we are requesting a loan or cash advance of $ 700,000 on fiscal year 2021 funding. No fault on the part of the Authority, receipt of federal and state funding associated with fiscal year 2020 totaling $ 1,197,000 has been delayed. This request goes beyond any additional support envisaged for fiscal year 2020. Without a loan or advance, the Authority will be forced to suspend its operations from February 15 of this year, ”wrote Mininni.
Mininni noted that the request was “due to the delay of [State’s Maintenance Assistance Program (SMAP)] funding in the amount of $ 697,000 and a federal grant of $ 500,000. Last week we were informed by the state that this year’s state SMAP funding, which was due to be released in January, was being delayed until an unknown future date due to NCDOT’s own cash flow issues.
Mininni noted that without NCDOT’s financial woes, WAVE would have received about half of the $ 1.2 million in funding in October.
The half a million dollars in federal funding is also being delayed. According to WAVE, the WMPO did not request an allocation from the Authority on time and, due to this delay, the funds will not be received until June. The WMPO disputes this, claiming that it received funding, a request for additional funding from WAVE in August, and that it followed the proper procedure to “flex” funding from another federal program and allocate it to WAVE. .
Mininni concluded by acknowledging pre-existing concerns regarding WAVE’s financial stability.
“We understand that this is an unusual and important request and that there will be many questions and concerns given the precarious financial situation of the Authority. We are available and willing to respond to each of these to the best of our ability, ”he wrote.
Chronology of the shortfall
According to internal emails provided by New Hanover County, Wurtzbacher contacted WAVE for additional information and a timeline of when the Authority realized there would be funding shortages.
According to an email from Wurtzbacher to county commissioners, “Wave learned of the delay in funding SMAP on January 7 and there is no firm indication at this point as to when that funding will be available. Wave also reported that they discovered in November that the WMPO had not applied for federal grant funding for Wave.
Wurtzbacher also noted that while WAVE’s board was “generally aware” that it would make this request, the board had not been formally notified. WAVE staff plan to do so at today’s meeting, according to Wurtzbacher.
Wurtzbacher noted that WAVE had not provided further details on the closure of particular roads or all operations, saying this would likely be determined after the Authority’s board discussed a plan.
New Hanover County is currently considering meeting WAVE’s demand; a spokesperson for Wilmington said city staff would make a recommendation on the issue to city council at its February 4 meeting.
Port City Daily has also contacted WAVE Executive Director Albert Eby, who has not commented on the Authority’s situation since Olson-Boseman and Saffo announced restructuring plans. Eby did not respond, but issued a press release denying that WAVE intended to suspend service; Eby declined to comment on Mininni’s email, although it has been carbon-copied.
Port City Daily also contacted the [W]MPO, which was apparently part of a large part of the Authority’s shortfall, although Mininni told Port City Daily that WAVE was not “blaming” the WMPO.
WMPO Executive Director Mike Kozlosky said he “would not characterize the timeline as a ‘delayed request by DFO to allocate funds to the Authority.” He noted that “[t]here is a process that is necessary to flexibly and allocate these funds.
Kozlosky offered the following description of the process:
The federal funds mentioned in the email are funds attributable directly to the Surface Transportation Block Grants Program (STBGP-DA). These funds are Federal Highway Administration (FHWA) funds that are under-allocated to DFO due to the DFO Transportation Management Zone designation (urbanized area of over 200,000 people). The eligibility requirements for the project and activity are outlined in 23 USC 133: Block Grants Program for Surface Transportation.
These STBGP-DA funds are discretionary and awarded by the DFO Board of Directors through a competitive process. DFO received a funding request from the Cape Fear Public Transportation Authority for these funds in August 2019. The DFO Board of Directors supported the allocation of $ 500,000 in STBGP-DA funding for fiscal year 2020 to the Cape Fear Public Transportation Authority for active public transport (preventive maintenance and ADA) on September 25, 2019. This funding allocation provides additional funds to the Authority that are not specifically earmarked or guaranteed as such. Since these federal highway funds are used for public transportation activities, they must be transferred from the FHWA to the Federal Transit Administration (FTA). The request for flexibility was submitted by DFO to the North Carolina Department of Transportation on October 23, 2019. The administrative change was posted as part of the agenda of the North Carolina Transportation Council and Council. Wilmington Urban Area DFO (Administrative Amendment 20-1) in January. and will be considered for formal approval by the North Carolina Transportation Council and DFO Urban Wilmington Council in February.
This article will be updated with any new information and all the responses from public transport players.
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