At last week’s Nassau Inter-County Express (NICE) Bus Transit Committee meeting, NICE CEO Michael Setzer outlined a plan to fill the $3.3 million deficit in this year’s NICE budget. The deficit mitigation plan includes:

• $1.8 million in additional Nassau County funding – a 70 percent increase in the County’s contribution – bringing the total annual funding to $4.4 million
• Veolia, the private operator of NICE, will cede $400,000 in profit
• Cash paying riders will see a fare increase of more than 10 percent — from $2.25 per trip, to $2.50, and
• $700,000 of the deficit will be pushed into 2015 – the result of a proposal to align NICE’s fiscal budget with Nassau County’s January to December fiscal year, thereby reducing the timeline for the needed deficit mitigation from one year to 9 months

County Executive Ed Mangano should be applauded for providing additional funding for the NICE bus system, and Veolia’s generosity — while unlikely to continue from a business designed to turn a profit — is welcomed. This mitigation plan provides needed stability for riders; the NICE system has suffered declining ridership as a result of service reductions and declining customer satisfaction over the past two years.

For the second year in a row, however, a portion of the budget will be balanced on the backs of bus riders, with an additional fare hike expected in 2015.

Adjusting NICE’s budget cycle should also give pause to riders and policymakers. Over half of NICE’s $122 million operating budget for 2014 comes from State Transit Operating Assistance (STOA), which is only  finalized when the state budget passes (usually) at the end of March each year. Shifting to a January to December fiscal budget cycle forces NICE budget analysts to estimate funding levels even before the Governor issues his or her preliminary executive budget. Pushing these estimates further afield from the system’s largest source of revenue could throw off the accuracy of future budgets.

Finally, this mitigation plan applies for only one year and does not address anticipated future deficits. Nassau County has not guaranteed its increased contribution beyond this year, and a solution to address the driving forces behind this year’s deficits — higher labor, health and energy costs, which are expected to rise again in the coming years — has not been outlined. In order to avoid lurching from funding crisis to funding crisis with each year, County Executive Mangano and the County Legislature must identify a sustainable and predictable funding mechanism to preempt the next funding crisis.

Public hearings on the plan will be held in July, and if adopted by the BTC, the fare hike is expected to go into effect in September.