Ozark Regional Transit receives clean audit, updates board on federal grant projects

Transit provider Ozark Regional Transit received a clean opinion in an audit of its financial records for 2017, and officials updated board members on a $2.9 million federal grant that will be used to build an administrative office at its headquarters on U.S. Highway 412 in east Springdale.

In a presentation Thursday (Sept. 27), senior auditor David Eaton of accounting firm Przybysz & Associates told board members no misstatements related to error or fraud were found in the audit, and that depreciation increased substantially. “Last year, you guys had a very big year of rebuilding,” he said.

On Jan. 10, 2017, a fire destroyed 20 buses and damaged two buildings at ORT’s headquarters at 423 E. Robinson Ave. In January, ORT received eight buses to begin replacing the destroyed fleet and started to reduce the number of leased, borrowed or donated buses in the fleet. On April 5, the Federal Transit Administration (FTA) announced ORT would receive a $3.6 million grant to replace the majority, if not all, of the remaining buses that have yet to be replaced after the fire.

On Sept. 14, ORT ordered 12 diesel-powered buses from Creative Bus Sales. They should be completed in about six months and delivered sometime in March or April, Executive Director Joel Gardner said. The hope is that these buses will allow ORT to return all the leased or borrowed buses.

On Sept. 25, U.S. Transportation Secretary Elaine Chao announced the FTA will award $366.2 million in grants for 107 projects in 50 states and territories and that ORT would receive a $2.9 million share of the money. The funding will come from the FTA’s Buses and Bus Facilities Infrastructure Investment Program.

Gardner explained that the money will be used to build a 10,000-square-foot administrative office and will replace its existing 4,500-square administrative office, which was built in the 1970s. The federal grant that ORT will receive for requires a 20% match, and ORT will use 3.5 acres of the 10 acres at its headquarters as the match. Including the value of the land, it’s a $3.625 million project, but the work to complete the new building is expected to cost less than the $2.9 million grant that ORT will receive. Remaining grant money could be used for building maintenance.

ORT looks to receive proposals from contractors on the project and to have construction completed in two years, he said. Also, ORT will seek public input on the design of the building. Plans to replace the existing office building have been in the works for three to four years.

Melissa Reeves, director of public relations for the city of Springdale, said the public will appreciate having a beautiful building along the road there and hopes to keep the public informed throughout the project. “I’m really looking forward to what it’s going to look like for the future,” she said.

In other business, board members approved a transit asset plan that’s required by the FTA. The plan includes targets on the condition and age of its vehicles, and one goal is to have no more than 20% of its fleet operating past its usable life. The percentage is about 60% as it continues to work to replace its buses, but Gardner expects it to decline to between 20% and 25% after receiving the 12 new buses in March or April.

After the meeting, Tim Conklin, transportation programs manager for the Northwest Arkansas Regional Planning Commission, said ORT wouldn’t face any penalties if it didn’t meet those targets. Over time, the targets will show how the region invests its federal funds.