01/12/1948 Meeting - Laserfiche WebLink

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~ B9 - - - - - -------~--------- --- I If the fare structure provides less than these requirenlents, the quality of service is bound to suffer. We cannot carry out our program of continued improve- ments if operations are carried on at an unprofitable level. I We have presented to you a financial statement showing the results of operations of the Oregon Motor Stages for the period of January 1,. 1947 to October 31, 1947. This statement indicates the operationg costs under the old contract with the Union, as well as the price of products used in this operation, practi- cally all of which have been increased in cost since the period of this statement. You will note that the operations show, after all expenses, a net operating revenue of $30,854.47. :,.'") ,:,(0 ,f./'. The Oregon Motor Stages operate approximately 600,000 miles per month. Of this mileage, slightly more than 100,000 miles are operated in Eugene and surround- ing areas. Because of the fact that we operate 600,000 miles monthly we are able, through our centralized purchasing department, to obtain materials and services at a rate much lower than if we operated only 100,000 miles. These reduced costs benefit the City Operations to an extent not discernable in the financial state- ment. This city receives the benefit of skilled maintenance and management at a cost proportionately lower than if the City operation were a separate unit. It would be extremely difficult to present a financial statement placing this operation on its own merits. This operation is an integral part of the whole and could not survive under present rates if severed from the main body. Neither could present services be rendered and additions and betterments in plant equipment and service be obtained unless the previous level of income against costs be pre- served. I It is impossible to give you an operating statement of Eugene by itself due to the method of our operation. Springfield, Coburg and Santa Clara are tied into the Eugene City Lines, both in revenue and costs. In addition our operation becomes more complicated in separating costs due to our body and paint shop being located in Salem and our motor, transmission and differential overhaul work performed in Portland. Equipment such as Break-in Dynameter, Cylinder Head Grinder, etc. WOQld be too expensive for the Eugene Operation by itself and we deem it more economical to do this work in centralized point. Purchasing is also done from our Portland Office, as well as all of the bOOkkeeping. To separate all of these expenses would entail a great deal of man hours and would increase our costs considerably. We have, however, our out-of-the-pocket costs for the Eugene, Springfield and Santa Clara Operations ending October 1, 1947 which totals .25094 per mile. Our new labor contract and added costs will increase this figure by 15%. This will bring our out-of-the-pocket costs up to .2885. At the present time our Gross Income in the Eugene, Springfield and Santa Clara Operation is .31 cents per mile which is .01 cent per mile under last year's average. This was caused by adding mileage in the operation to give service to points that had not developed in population sufficiently to pay its way, but still needed service. It is our honest estimate that our expenses, in addition to the out-of-the-pocket cost is .03 cents per mile, making a total of present expenses of .3185. The increase which we request should develop an additional .01 cent per mile. Should the busi- ness rem~in on the same volume basis for 1948 and no new rates required, a small prOfit can be expected." City Attorney Pennington reported to the Council that the public notice for hearing on Council Bill No. 292 had been published in accordance with Charter provisions. Upon motion the communication of the Oregon Motor Stages was ordered referred to the Judiciary Committee and the public hearing set for January 12, 1948 ordered continued pending a report from the JUdiciary Committee. Motion carried. I It was moved by Councilman Hanns, seconded by Davis that Council Bill 292 be taken from the table and placed on its second reading. Motion carried. It was further moved by Davis, seconded by Crumbaker that Council Bill 292 be moved to third and final reading with unanimous consent of the Council. Councilman Allen voted NO and the motion was declared lost. I It was moved by Bailey, seconded by Wells that the vote by which Council Bill 292 and the communication of the Oregon Motor Stages was referred to the Judiciary Committee be re-considered. Motion carried. Mayor McNutt then called for a rollcall vote on the original motion to refer the matter to the Judiciary Committee. Councilmen Davis, Bailey, Wells and Hanns voting NO. Councilman Crumbaker and Allen voting AYE. The motion was declared lost. It was moved by Hanns, seconded by Crumbaker that the motion for a unanimous consent to consider Council Bill 292 for third reading be re-considered. Motion carried. ~.....