Red Bank staff discuss interlocal agreement with CARTA as grant funding ends

Red Bank staff presented a proposed interlocal agreement with the Chattanooga Area Regional Transportation Authority (CARTA) to continue paratransit service in the city as an initial grant that funded the program has expired. The work-session discussion focused on costs, ridership and the need for a formal agreement to transfer state street aid funds to CARTA.

Staff member identified in the transcript as “Mister Grama,” speaking on behalf of Director Leslie Johnson, said CARTA executed the original grant-funded pilot and that current demand averages about 65 one-way trips per month, primarily for medical trips such as dialysis. The city budgeted $15,600 for the current fiscal year to contribute toward service; that figure is based on a CARTA cap of $20 per trip and 65 trips per month, Grama said. Grama told the commission the CARTA billing method is demand-driven and actual year-end costs could be higher or lower than the budgeted estimate.

Why it matters: the grant that covered the service for the first two years has run out, and the city must now use local funds to maintain the service. Grama said the contribution is drawn from the state street aid fund, which is an allowable use for transit support, and that because the city will be paying CARTA, an interlocal agreement is required to permit the transfer of funds. He said the proposed agreement would automatically renew each year unless either party changes it.

Discussion details: Grama confirmed the rider fare remains $2.50 per trip under CARTA policy where riders are within three-quarters of a mile of fixed-route service; he noted that few Red Bank riders are within that distance, so the commission could consider changing the rider fare. Across the CARTA service area, Grama said fares range from $2.50 to $4 per trip and the commission may face decisions next budget cycle to increase the rider share. He projected the city’s contribution could roughly double next year (from the $15,600 budgeted this year to about $30,000) if CARTA’s per-trip costs rise after grant funds expire.

Next steps/directions: staff said they will return to the commission as part of the next budget process with updated cost estimates from CARTA’s CEO, Charles Fraser. No formal vote was recorded in the work session on the interlocal agreement; the agreement and a one-and-a-half-page resolution (Resolution No. 25-1781) were included in the regular-session packet for board action.

Community impact and limits of authority: Grama stressed the service’s primary constituency is medical riders. He also clarified the funding source (state street aid) and that the city’s fiscal exposure depends on actual billed trips. No change to CARTA operating rules or the interlocal template was adopted during the work session.