1. Presented on January 20, 2012

2. ◦ Services 2 23 fixed routes, 10 specials, 67 peak buses 108 vans, 95 daily vehicle runs Zone defined general public demand response; integrated with LANtaVan

3. FY2011 Financial Position 3

4. 4 (in 000s)FY2011 Current assets14,056 Noncurrent assets9,211 Capital assets, net18,300 Total assets41,567 Total liabilities17,294 Net assets: Invested in capital assets18,300 Restricted in net assets4,822 Unrestricted1,151 Total net assets24,273

5.  Current assets includes MATP receivable of $229K – estimated collection date is March 2012  Current liabilities includes line of credit balance of $3.2M – available line is $6M at an interest rate of prime + 0.5%  All accounts payable are current  Restricted net assets includes $4.8M of Act 44 Operating funding carryover  Unrestricted net assets includes $688K LANtaVan surplus 5

6. 6 Revenues (in 000s) FY2011 Passenger fares5,544 Government fare assistance programs 6,996 Other operating revenues529 Nonoperating revenues17,709 Total revenues30,778

7. 7 Operating Expenses (in 000s) FY2011 Wages7,250 Fringes6,664 Purchased transportation10,284 Fuel1,973 Insurance463 Other expenses3,298 Total operating expenses29,932

8. 8 Net Assets (in 000s) FY2011 Invested in capital assets18,300 Restricted net assets Act 44 carryover4,791 Insurance reserves31 Unrestricted net assets LANtaVan surplus688 Other463 Total net assets24,273

9. FY2011 Current Operations 9

10.  Current organization chart is provided as Handout #1  There are no vacant positions  New bus operator and maintenance positions are planned as part of the implementation of Moving LANta Forward 10

11. Collective bargaining agreement term is 12/15/10 to 12/14/12. * Non-union employees 11 Bus OperatorsCurrentProjected FY13 Starting wage$10.87$11.20 Top wage$21.74$22.40 Average wage$19.12$19.70 Contract wage increase3% Job ClassificationNumber- Full TimeNumber-Part Time Bus operators1320 Maintenance workers240 Operations supervisors*110 General/administrative*143 Senior management*40

12.  Part-time employees are used in clerical positions only  Approximately 40% of bus operators are “split shift” drivers  Outsourcing report is provided as Handout #2  LANtaVan and LANtaFlex services are subcontracted through an RFP process 12

13.  Health plan overviews, including copayments and deductibles, are provided as Handout #3  Coverage and contributions are reviewed as part of collective bargaining  All employees receive same coverage  LANta is currently self-insured for health coverage. Total FY11 costs, including stop-loss premium, were $3M.  From 2007 to 2011, costs increased 2% per year.  LANta engages a consultant to review the estimated costs of self- insurance versus premium based plan  Employee contributions are 1% of gross wages based on a 40 hour work week. Maximum contribution is $500 annually.  Health plan covers employee, spouse and eligible dependent children  Retirees and spouses are covered to age 65 if employee retires between 62 and 65. No coverage for retirees after 65. 13

14.  LANta administers and contributes to two defined benefit pension plans: the LANTA Union and LANta Non-Union Employees Pension Plans  Normal retirement age for both plans is 65  Early retirement under both plans is allowed at age 62 with 20 years of service  Participants in the Union plan make bi-weekly contributions of 3.5% of gross wages  Participants in the Non-Union plan make bi- weekly contributions of 3.0% of gross wages 14

15.  Plan descriptions and funding information is provided as Handout #4  Both plans are underfunded as a result of poor investment performance due to the current economic climate  The Union plan is 48% funded  The Non-Union plan is 65% funded 15

16.  LANta contributes the Minimum Municipal Obligation (“MMO”) to each plan  MMO is calculated by an independent actuary based on the current statute  LANta does not take advantage of protections available under Act 44, choosing to fund 100% of the amounts required to fund the plans 16

17.  Current Cost per Gallon ◦ Contract rate or market rate? Contract rate ◦ Terms of contract are provided as Handout #5 ◦ Includes purchase of fuel for LANtaVan  Projected Cost per Gallon and Basis for Projection ◦ Contract rate or market rate? Contract rate ◦ It is anticipated that the current contract terms/options will continue in future years 17

18.  Provide average fare: ◦ Current Amount ◦ Future Amount 18 Fare Type Date of Last IncreaseCurrent Amount Date of Planned Increase Amount After Planned Increase Base Fare 04/01/2007$2.00N/A Transfers $0.25N/A Zone Fares N/A Multi-ride passes One-Day Disabled One- Day 10-Ride 31-Day Annual 10/01/2011 10/01/2008 10/01/2011 $4.00 $1.00 $15.00 $55.00 $605.00 10/01/2013 N/A 10/01/2012 $5.00 N/A $16.00 $60.00 $660.00

19.  Date of Last Fare Increase – 10/01/2008  Current ◦ Average fare - $22.15 ◦ LANta has sponsorship arrangements with the County Area Agencies on Aging and MH/MR agencies  Planned Changes ◦ Date of planned increase - 10/01/2013 ◦ Estimated average fare - $25.50 ◦ There are no planned changes to the existing sponsorship arrangements 19

20. 20 FactorsCurrent Amount Projected Future Amount Explanation Pension$907K$1,134KCosts are controlled by market factors Workers’ Comp Insurance $368K$561KCosts are controlled by experience Increased service$750K$800KCosts are based on hourly costs and amount of service added

21. 21 FactorsCurrent Amount Projected Future Amount Explanation Fuel costs$1.9M?Costs are controlled by market factors at time of contract Easton Intermodal Center N/A$100KNew facility Health costs$3.0M?Costs are controlled by experience, market factors and regulations

22. 22 InitiativeCurrent Cost Planned Action and Implementation Date Projected Savings Consolidation of LANtaVan services to one subcontractor $9.5MInitial contract awarded in FY2007; extension awarded in FY2010 $8M over contract term Wage freeze (salaried employees) N/AImplemented for FY2010$30K SAFTI$1.4MAggressive defense of claims keeps premiums lower $500K/ Year Printed timetables$100KInternalized art work$10K/ Year Paratransit contract extension $9MExtension resulted in lower costs in year 5 $100K

23. 23 InitiativeCurrent Cost Planned Action and Implementation Date Projected Savings ADA certification program $2MIn-person certification will result in less paratransit use $300K/ Year Energy audit$100KResulted in suggestions for increasing efficiency $10K/year Hybrid buses$2.5MResulted in better fuel efficiency, less maintenance $10K/year in fuel and $150K in maintenance

24. 24 InitiativeCurrent Revenue Planned Action and Implementation Date Projected Revenues New revenue vehicle and shelter advertising program $250KNew vendor selected in FY2011 $200K additional per year Raising average fareN/AImplemented for FY2010 to lower discount on fare pass media – See Handout #6 $100K per year Private/public partnerships N/AImplemented in FY2012 – example: Amazon contract $100K per year Grants$16MAggressively pursue

25. 25 InitiativeCostPlanned Action and Implementation Date Projected Benefit Advanced Transit Management System $2MATMS project fully operational – includes APC, AVL and integrated operating systems (farebox, auto- announcement system, cameras) Data currently being used to assist in adding/re moving services ADA Certification$300K/ Year October 17, 2011 – in- person assessments for ADA- and MATP- sponsored consumers $300K/per year

26. 26 InitiativeCostPlanned Action and Implementation Date Projected Benefit Computer Aided Scheduling N/A – part of ATMS Spring 2012 – being tested now Results in more efficient schedules Flex Service$25KImplemented in August 2011 Results in more efficient delivery of service

27. FY2011 Service Statistics/ Trends 27

28.  Describe Any Proposed Changes 28 Fixed RouteFY 2010- 11 FY 2011- 12 FY 2012- 13 FY 2013- 14 FY 2014- 15 Rev. Veh. Miles2,7192,9263,066 Rev. Veh. Hours211224235 Passenger Trips5,6005,782- 5,963 5,924- 6,248 5,983- 6,435 6,043- 6,628 ACT 44 PERFORMANCE MEASURES Pass. Trips/Hour 26.526.6 27.428.2 Op. Cost/Hour$88.97$89.48$91.15$93.89$96.71 Op. Rev./Hour$22.16$20.88$20.69$21.50$21.93 Op. Cost/Trip$3.35$3.36$3.43

29. 29

30. 30 Shared-RideFY 2010- 11 FY 2011- 12 FY 2012- 13 FY 2013- 14 FY 2014- 15 Total Veh. Miles 4,8854,6054,7434,8855,032 Cost per Mile$1.95$2.07 Total Veh. Hours 193184189195201 Cost per Hour$47.77$51.77$51.91$51.82$51.79 Total Pass. Trips 433434 Cost per Trip$21.33$21.95$22.61$23.28$23.98 Rev. per Trip$22.4221.25$21.65$22.58$24.44 Trips per Hour2.242.362.302.232.16

31. FY2011 Funding Statistics/ Trends 31

32. 32 FY 2010- 11 FY 2011- 12 FY 2012- 13 FY 2013- 14 FY 2014- 15 Total Operating Expenses18,77320,07824,43022,07322,735 Total Operating Revenue4,7614,6764,8645,0545,155 Total Operating Deficit14,01215,40216,56617.01917,580 Subsidies: Federal5,0404,9254,930 State8,2929,76310,88611,30111,823 Local680714750788827 Total Funding14,01215,40216,56617,01917,580 Balance (Cumulative)$4,800$2,800$841$100$0

33. 33 FY 2010- 11 FY 2011- 12 FY 2012- 13 FY 2013- 14 FY 2014- 15 Operating Expense10,80511,29511,63411,98312,342 Passenger Revenue1,3021,1881,4121,3841,385 Lottery2,5832,794 3,213 MATP4,2913,8573,9724,4144,546 Other (Includes ADA charges) 2,8123,1522,8593,2783,395 Balance (Cumulative)688384(123)184381

34. FY2011 Other Information/ Assumptions 34

35.  Moving LANta Forward ◦ 12 year strategic plan; adopted in 2010 ◦ Undertaken to address:  Rapid population growth and development  Significant growth in fixed route ridership  Prioritize use of Act 44 funding ◦ Plan includes:  Service Plan  Marketing Plan  Land Use Outreach Strategy 35

36.  MLF Service Plan identified three levels of expansion: 36 Level Change from 2010 Target Year Revenue Hours % Change Peak Vehicles Short22,00011.042014 Intermediate64,00033.082020 Long214,000119.026 With available funding

37.  First implementation steps with August 2011 restructure ◦ Schedule simplification ◦ New direct connections ◦ Created system of core routes ◦ New route nomenclature  Three digit designation  Provides indication of level of service ◦ Running time issues addressed ◦ Structure to guide enhancements 37

38.  Close to reaching Short Term plan levels ◦ 2011 changes added 4% to annual rev hours ◦ Another 4% budgeted for ‘12-’13  Organization’s goal is to reach Intermediate Plan levels ◦ Brings LANta to avg. rev hrs/capita for peer systems 38

39. 39 Revenue Hours per Capita 2010 Service Levels Revenue Hours per Capita Intermediate Term Plan

40.  Land Use Outreach – Expansion must be supported through land use decisions ◦ Municipal Planning Commission presentations ◦ HUD Sustainable Communities grant 40

41.  Continued frequency/span enhancements on 100’s routes – create a core system to: ◦ Be a feasible transportation alternative for more residents ◦ Create target corridors for development, economic incentives, specialty zoning 41

42. 42

43.  100’s routes enhancements ◦ August 2011 restructure addressed many span issues; minor enhancements still needed ◦ Focus will be on frequency  Goal: 15 min peak; 30 min off-peak frequencies ◦ Trip time and frequency enhancements through new Enhanced Bus models  Enhanced Bus/BRT Study - underway 43

44.  Address demand resulting from employment growth and development in: ◦ Western Lehigh County (Route 100 corridor) ◦ Central Northampton County (Route 33 corridor) 44

45. 45 Recently rezoned Jaindl property: Build out plans call for 4 million SF – Warehousing 450,000 SF – Retail Center 700 residential units Hamilton Boulevard: Expanding retail corridor. PCTI study Lehigh Valley West: Expanding industrial park; Primarily warehousing – fastest growing industry in Lehigh Valley

46. 46 Major mixed use development New St. Luke’s Hospital Anderson Campus Major expansion plans “Mayo Clinic of the East” Major mixed use development LVIP VI Expanding industrial park Proposed new interchange: Major mixed used development planned Route 248/Nazareth Rd Major retail corridor Route 33 Park & Ride Trans-Bridge service

47.  Need for expanded service hours to industrial park areas ◦ Revenue guarantee partnerships a potential model  Need for expanded service to medical complex  Expanded fixed route service on Hamilton Blvd, Nazareth Rd/Uhler Rd  Potential for expanded use of LANtaFlex 47

48.  Projected Impacts of Intermediate Term Plan: 48 Item Net Impact by 2020 Operators40 Maintenance Employees5 G&A Employees2-3 Peak Vehicles8 Fleet Vehicles10 Revenue Hours64,000 Revenue Miles800,000 Annual Passenger Trips 902,000 – 1,800,000

49.  Improvements will be targeted to priorities  Enhancements will be identified through a planning process  Performance will be continually monitored to maintain target productivity levels ◦ ATMS data will be instrumental in service monitoring 49

50. Capital Status Review 50

51. 51 Capital Assets (in 000s, Net of Accumulated Depreciation)FY2011 Land150 Buildings3,816 Revenue vehicles11,264 Service vehicles155 Shop equipment189 Furniture/office equipment1,643 Other revenue equipment1,085 Total capital assets18,300

52.  Current Fixed-Route Projects ◦ Purchase 20 hybrid buses ◦ Allentown maintenance facility ◦ Easton Intermodal Center ◦ Shelter/signs program  Current Shared Ride Projects ◦ Purchase 20 cut-away buses 52

53.  Short-term Future Fixed-Route Projects ◦ Replacement of 60 heavy-duty buses with hybrid buses ◦ Purchase of hybrid buses for service expansion ◦ Development of service hubs  Short-term Future Shared Ride Projects ◦ Replacement of 80 cut-away buses (existing fleet) ◦ Replacement of paratransit scheduling software 53