Merced County bus contracts at risk; leaders fear job loss

The fuel, maintenance and operations contracts for Merced County’s bus system may be put up for bid – but the risk of potentially losing the contracts to another vendor has some county officials worried it could result in a loss of jobs.

Merced County has held the maintenance contract for the 85 buses since July 2010, according to Stacie Dabbs, spokeswoman for the Merced County Association of Governments. The overall budget for maintenance services is $2.5 million, Dabbs said.

A recent Federal Transit Administration audit specified that all contracts exceeding $100,000 must go through a competitive bid process, MCAG documents show. The FTA provides $4.5 million in federal funding each year to pay for operations and maintenance of the county’s transit system, The Bus.

“They’re our funding agency, so they can say what we need to do to be in compliance,” Dabbs said. “Now FTA has made it clear that they’re requiring we go through this procurement process for all contracts.”

The new requirement stems from changes to existing FTA oversight guidelines and new regulations, Dabbs said. Not complying with the agency’s requirements could risk losing federal funding for Merced County’s bus system.

However, county officials say losing the maintenance contract could mean six people losing their jobs.

Mechanics at Merced County’s heavy equipment yard spend 70 percent of their time working on transit buses, said county Public Works Director Dana Hertfelder. The yard employs 11 mechanics and two parts clerks.

“If we lose over half our work, that’s a serious impact,” Hertfelder said. “You’re going to lose a proportionate number of mechanics because there is no other work for us to go find. These people were specifically hired to maintain the transit buses.”

Merced County also has an arrangement to provide fuel to the bus fleet. The buses make up 60 percent of diesel fuel sales at the county’s facility, Hertfelder said.

Hertfelder doesn’t expect an immediate negative impact from losing the fuel agreement, but he said it could have long-term effects.

“When we rebid our contract for the fuel supplier, it could (impact us) because we’ll be buying less gallons of gas,” Hertfelder explained. “The more the (gas) volume, the better the prices you get.”

The Transit Joint Powers Authority of Merced County, which oversees bus services, spends $1.2 million per year on fuel, according to documents.

Merced County District 3 Supervisor Linn Davis said his primary concern is the potential layoff of county employees.

“As a Merced County supervisor, I’m an employer and it’s part of my responsibility to maintain these contracts that generate revenue to keep those jobs,” Davis told the Merced Sun-Star.

Davis, who has experience working in both public and private sector roles, said it’s difficult for a public entity like Merced County to compete with private vendors.

“Most of my bidding processes have been through the private sector, and it’s easier to bid because you only have to answer to yourself,” Davis said. “There’s not as many voices involved in the process.”

The operations contract for The Bus, which includes drivers, supervision and insurance, is not held by Merced County. Dabbs said Merced Transportation Co. is the operations vendor.

MCAG officials said the fuel, maintenance and operations contracts will likely be rolled into one “Request for Proposal” bidding document, which will be released to the public after approval by MCAG’s directors. MCAG administers and staffs the Transit Joint Powers Authority, Dabbs said.

MCAG staff recommended approving the Request for Proposal at a meeting earlier this month, but no action was taken. MCAG directors, including all five members of the Board of Supervisors, voted Oct. 16 to continue the contract discussions at a meeting in November.

This story was originally published October 28, 2014 at 7:02 PM with the headline "Merced County bus contracts at risk; leaders fear job loss."