Bus system expected to run regardless of contract

On Behalf of Dunlap Fiore, LLC |

Most people, at some point in their lives, have used public transit for work, school and more. In fact, according to reports, nearly 1.2 million people ride the bus annually. Thus, if bus service were to halt due to a contract dispute or failure to renew a contract, a large segment of the population which relies on the public transit for their daily activities could be adversely impacted.

Louisiana residents may find it interesting to learn that the City of Monroe has elected to allow First Transit Management Company to continue operating the city’s bus system even though their contract expired. According to reports, when First Transit’s contract was up for renewal last December, the City Council voted against renewing the contract. This did not cause a lapse in operations however, since the funding for First Transit’s operations was secure through the end of April.

The mayor of the city announced that, come May, the city would continue to allow First Transit to run the bus system. However, the city will have to pay the company using city funds instead of federal dollars, the reason being federal regulations mandate that a contract be put in place if federal funds are to be used to pay for transit operations and maintenance. Initial estimates provided by the mayor put the total cost to the city at about $100,000. In lieu of that, federal funds will be redirected to cover expenses in other areas in the system.

The mayor and city council members have been at a standoff since the contract ended in December last year. The mayor has been meeting with city council members round the clock in an effort to negotiate a deal and bring an end to the dispute. He is, however, resolute in his position that First Transit is the best option for operating the city’s bus system and will not waiver in his position against having the city take over running bus operations. First Transit issued a statement in which it indicated that it would continue to run bus operations until otherwise instructed to do so and hopes that a resolution to the standoff will be imminent.

For businesses that are facing contract disputes, like First Transit and the City of Monroe are, legal guidance may be able to help each party come to a sensible solution.

Source: The Washington Times, “Mayor: First Transit to run Monroe bus system,” March 28, 2014