Car-Sharing Could Reduce Costs, Improve Efficiency of Cincinnati’s Vehicle Fleet

When a brother and sister are fighting over the same toy, a parent quickly steps in and teaches the children to take turns and share.

Now that Over-the-Rhine parking is at a premium, and the residential permit plan has been vetoed, the residents of OTR are going to have to find a way to share parking, or risk losing more of the historic neighborhood to parking lots and garages. Sharing also presents an opportunity when it comes to modernizing the City of Cincinnati’s fleet of 2,149 vehicles.

Mayor John Cranley (D) received unanimous support for this year’s budget, which includes $110 million to make much-needed upgrades to the City’s fleet and roadways over the next six years. While some vehicles, like those for police and fire, cannot be shared, others certainly can; and by implementing a program like Zipcar’s FastFleet program, Cincinnati would benefit from significant savings and operating efficiencies.

In 2012, an internal audit of the Fleet Services Division found that fleet management has been “unwieldy” and mentioned that a knowledgeable and empowered staff is needed to properly manage the system. This has proven difficult over the past decade due to a severe cut in funding for the department in 2003.

“Almost the entire management team left the department near the end of 2007 and was not replaced,” the internal audit noted. “While the staff operates to the best of their abilities, they are undermanned without the resources to correct the inertia of the department.”

The Fleet Services Division operates under the Public Services Department, and controls and maintains 2,149 motorized vehicles for various departments at City Hall. These departments pay $63 an hour for maintenance and repair of the vehicles and are allocated a portion of the capital budget based on their proportion of need with regards to their percentage of obsolete fleet.

In 2011 Fleet Services was allocated $4,301,900 in capital dollars and $5,240,600 was allocated for 2012. These numbers are expected to rise as soon as the approved budget is published on July 1, but more money for new vehicles is only part of the solution. The 2012 audit also recommended reducing the size of the fleet, evaluating underutilized equipment, and examining the cost of leasing sedans and light trucks.

With services like FastFleet, City Hall could optimize its fleet without degrading operations, thus lowering maintenance and administrative costs.

FastFleet works by tracking vehicle usage by employees through GPS monitoring systems. This enables the service to produce real-time data, with recommendations on synergy and optimization. Once this data is analyzed, car assignments can be reorganized to allow for sharing of each vehicle by city employees, ultimately allowing for more efficient usage of vehicles.

In Washington D.C., city officials there were able to benefit from $6 million in savings over a five-year period by eliminating more than 200 administrative vehicles from their fleet. While Cincinnati’s fleet is smaller than the nation’s capital, proportional savings are safe to be assumed.

With City Hall poised to invest millions into its fleet operations, now is the perfect time to look into a solution such as this that could potentially reduce the City’s fleet, while also improving its performance.

A program could even be put in place to allow for public use of the vehicles, akin to the city’s existing Zipcar system, when city employees are not in need of the fleet. The revenue collected from these services could then be used to offset the public’s cost of maintaining the city’s fleet, while also expanding car-sharing services to other neighborhoods outside of the city center.

As it stands now, the City of Cincinnati does not even know what the optimal size is for its vehicle fleet. Tracking the performance of the fleet and analyzing the data will help bring clarity to the matter, and allow for the fleet to perform more efficiently.

Implementing a vehicle sharing program for Cincinnati’s municipal fleet would help save additional taxpayer dollars, improve operations and bolster car-sharing throughout the city.

EDITORIAL NOTE: Chad Schaser contributed to this article.

Episode #46: 2014 in Review

New Parking MetersOn the 46th episode of The UrbanCincy Podcast, Randy, John, and Travis take a look back at 2014. We discuss our top posts of the year, including the renaissance beginning to take place in the Northern Liberties and new transportation options including Uber, Lyft, and Red Bike. We also make some predictions about what’s the come in 2015, including the expansion of Red Bike into other Cincinnati neighborhoods and Northern Kentucky, new residential developments opening in 2015, and new potential uses for the Riverfront Transit Center. Finally, we discuss the new parking meters and expanded enforcement hours that went into effect on January 1st for the Central Business District and Over-the-Rhine.

Zipcar Holding Tight in Cincinnati While Making Changes Elsewhere

The car sharing economy came to Cincinnati in October 2011 when Zipcar launched their services at the University of Cincinnati, and expanded to Downtown and Over-the-Rhine in December 2012.

Since that time, however, peer-to-peer driving services, like Uber and Lyft, have emerged and begun challenging the more established business model of companies like Zipcar, which was acquired by Avis in January 2013 and boasts a global membership of more than 900,000.

In the case of Zipcar, the user is the driver, and must return the car to its starting point – a requirement limiting potential growth of Zipcar and other car sharing services. In order to stay competitive, Zipcar has recently launched new one-way services in its hometown of Boston.

“We are currently beta testing the service in Boston with our Boston members,” Jennifer Mathews, Public Relations Manager at Zipcar, told UrbanCincy. “Our plan is to roll out the service to additional markets once it’s ready.”

While one-way car sharing travel may soon be a reality in Boston, it appears to be further off for smaller markets like Cincinnati, as does the availability of cargo vans, which are presently available in a limited number of markets, but not Cincinnati. The desire for such vans, industry experts say, is so that they can be used for more utilitarian purposes like moving. For now, those participating in Cincinnati’s car sharing economy will continue to need to either use a traditional rental company, or borrow a friend’s truck for such purposes.

Since its debut in 2011, however, Zipcar officials say that they have made changes to their operations and 11-car fleet in Cincinnati in order to stay relevant.

“While the number of cars has remained somewhat consistent over the years, we have moved locations and updated our vehicles throughout the program,” Mathews explained. “Zipcar strives to place cars where our members want them. As we see pockets of members pop up in certain areas or neighborhoods we will move cars around to make sure that they are convenient as possible.”

Of course, Cincinnati’s Zipcar network is substantially smaller than other cities, thus reducing its usefulness to more than a small collection of users.

While there are no immediate plans for expansion, Mathews does say that the company will continue to monitor their two programs – University of Cincinnati and City of Cincinnati – over the course of 2015 to determine whether additional changes or expanded offerings are needed.

Those with memberships are able to use those in any of the hundreds of markets where Zipcar operates worldwide. Cincinnati’s 11 vehicles can be found at the northwest corner of Race Street and Garfield Place, Court Street in between Vine and Walnut, the southeast corner of Twelfth and Vine Streets; and on the University of Cincinnati’s main campus on McMicken Circle and just north of Daniels Residence Tower.

The days of the two-car household may soon be behind us

As VMT continues to flat line and even decline, it also appears that car ownership is on its way out of style. We all know that young people aren’t getting their license as early as they once had, and are even forgoing it altogether in increasing fashion. But now, according to new economic predictions, the days of the two-car household may soon be behind us. More from Streetsblog USA:

In the U.S., says KPMG, car sharing companies like Zipcar, on-demand car services like Uber, and even bike-share will eat away at the percentage of households owning multiple vehicles, especially in major cities. Today, 57 percent of American households have two or more vehicles. KPMG’s Gary Silberg told CNBC that the share of two-car households could decrease to 43 percent by 2040.

In this scenario, KPMG predicts that the rise of “mobility services” will displace car ownership by providing similar mobility but without the fixed costs. The typical new car now costs $31,000 but sits idle 95 percent of the time. Given other options, Silberg told CNBC, many Americans will be happy to avoid that burden.

EDITORIAL: Improve Efficiency, Grow Revenues with Urban Advertising Program

Cincinnati City Council made the well-intentioned decision to prohibit advertising within the public right-of-way. The idea was to rid the city of what some perceived as unsightly bus bench advertisements and invasive and heavily lit billboards.

As is often the case with new regulation, it has created unintended consequences including the inability for Metro to collect advertising revenue from their bus shelters and stymieing the ability for Cincy Bike Share to properly advertise on its planned system in order to pay for its annual operating expenses.

As a result, the City of Cincinnati should toss out the ordinance approved last January and replace it with a new comprehensive Urban Advertising Program that protects residents from unsightly additions in their neighborhoods, while also preserving the flexibility for the city and its various agencies to collect revenues that reduce the burden placed upon taxpayers.

SORTA Non-Transportation Revenue

Public Right-of-Way Advertising Lease
Under UrbanCincy’s proposed plan, the City of Cincinnati would lease their advertising assets. These assets would include a predetermined set of advertising locations (bus benches and shelters, newspaper stands, bike share kiosks, car share and taxi cab stands, and intercity bus stops).

The lease with the private company that would manage the system would then include a small upfront payment for the rights to the assets and annual payments to an authority that would oversee the program.

Such agreements are commonplace in many other North American cities and are often undertaken by companies like JCDecaux, Clear Channel and Lamar.

Program Membership & Representation
In this proposed arrangement the City of Cincinnati would be one entity, albeit the primary one, in the overall program since they control the right-of-way. The Southwest Ohio Regional Transit Authority (SORTA) would also be involved so that they could have representation for their Metro bus and streetcar systems. Cincy Bike Share would then be a third organization that would need to be represented, along with a representative for private taxi cab, car share and intercity bus companies.

The City’s established Community Councils should also have representation on the board, and potentially even share directly in the revenues generated by the program outside of those funds paid to the City of Cincinnati.

The share of the annual revenue payments, of course, would not include any of the private companies operating within the public right-of-way, such as Megabus or Zipcar, but their representation on the board would ensure that their interests are in fact considered in the oversight of the program.

Essentially their lack of collecting annual revenue payments would serve as their annual payment to advertise their particular operations within the public right-of-way without needing to go through the private company managing the assets. This allows those companies to advertise for their services in the public right-of-way, which is currently prohibited.

The members appointed by these various agencies and companies would then become the decision making board governing the new program. This board would also be responsible for contracting out the management of the program.

Urban Advertising Program Org Chart

Economies of Scale
Bringing all of these various entities under one roof, with one unified leasing strategy, will increase the value of public right-of-way advertising. Businesses could work with their advertising representatives to ensure the exact market saturation, exposure and risk aversion as is desired. They would have one contact point that could manage their advertisement campaign in a comprehensive, city-wide manner.

This would also mean that the various government agencies and private companies operating in the public right-of-way involved would not need to have their own full-time staff equivalent to manage their own individual advertising program. Instead, they would collectively decide upfront on an initial value assessment of their various assets, and an ongoing value share agreement based on the contracted annual payments.

Standard Guidelines
The appointed board would be able to determine what kind of content to allow to be advertised. This would need to be a decision made up-front and in conjunction with the private operator so that there is no confusion later. But this would, in theory, allow advertising to return but in a regulated marketplace, thus preserving neighborhood character and integrity.

This is not something that can be accomplished without a separate operator involved, since the City and other public entities are not allowed to decide who and who cannot advertise.

Right now none of these entities are able to take advantage of the potential advertising revenues that would otherwise be available. And if they were, the total profits from the system would be severely diluted due to the fractured and duplicative management and oversight needed.

This Urban Advertising Program would solve those problems by allowing for the capture of an unrealized revenue stream in a well-regulated manner that would protect the integrity of our neighborhoods.

But perhaps even better is that the program is scalable and could include other cities like Norwood, Covington and Newport to opt in should they so choose. All that would change is the representation on the board and the share of the annual revenue payments.

Advertising is part of everyday life. By prohibiting our local governments and public agencies from benefiting from the revenues that come with it, we are only tying their hands and placing an even greater burden on taxpayers. There is certainly a balance to be struck, but UrbanCincy is confident that the representatives that would make up this board would be more than capable at striking that right balance.

This is the third part in a series of proposals offered by UrbanCincy that would help grow city revenues, enhance public services and make for a more efficient local government. If you are interested, you can read our proposal for shifting to a Pay As You Throw trash collection system and our eight-point plan for fixing the city’s broken parking system.