OCEAN CITY – A public hearing will likely be held in mid-May to hear the community’s input over the city’s plan to eliminate the $1-per-boarding bus fare option for Ocean City’s transit system.

During Tuesday afternoon’s work session, Public Works Director Hal Adkins reiterated what was presented to the Mayor and City Council during budget discussions last week regarding the proposed bus fare change as well as explained the necessary procedure in doing so.

City staff is recommending the $1-per-boarding bus fare option be eliminated and charge the $3 ride-all-day fare only. The proposal was submitted as a means to increase revenue and reduce the town’s general fund contribution for municipal bus service.

During budget talks last week, Adkins explained based on Maryland Transportation Administration (MTA) guidelines a public hearing will be held if a written request for a hearing is submitted. In the event a public hearing is requested, a hearing will be held May 19 during the Mayor and City Council’s regular session, which is the same time the Fiscal Year 2015 (FY15) Budget will be presented on second reading to receive its final vote.

If, as a result of the public hearing, the Mayor and City Council approve the proposed fare change, the council’s decision will then be forwarded to the MTA and the change will take effect as of May 23.

Based on previous analysis of historical ridership, charging $3 ride-all-day only will increase revenue in the FY14 Budget by $78,000 and by $492,000 in FY15. The city’s fiscal year starts on July 1 of each year.

“As discussed at a previous budget meeting, one should not simply look at this as revenue enhancement needs,” Adkins said. “It may be the priority but you need to realize also the hope for transit in Ocean City is a tool of mobility. While providing an all-day fare, you allow individuals to come and go at will versus a destination oriented system where someone is simply going to a single location.”

Adkins furthered the Federal Transit Administration’s guidance for fare elasticity is for every 10 percent a fare is raised, 4 percent of your ridership is lost.

“Historically in Ocean City as a seasonally oriented system we have not followed that norm for percentages,” Adkins said. “Keep in mind over the years, we made adjustments to the bus system, to the tram on the Boardwalk, and we don’t see those results. So, the numbers that has been provided to you are what we feel based on historical trends in Ocean City is the revenue that you will get.”

Cindy Hofeditz, who owns a local amusement business, took the opportunity to address the fare change during the citizen comment portion of that afternoon’s meeting.

“I am a seasonal employer here during the summer. This will be our seventh summer,” she said, “I feel that it will affect our workers. Last year we hired 12 employees for our operation, and only one of them had a vehicle. They ride bikes, walk, or however they can get to work. I am not in favor of dropping the $1 price. My husband couldn’t be here today but his input was maybe there could be a pay one price for the residents or seasonal workers.”

Adkins responded the $1 boarders, or “destination rider”, are considered to pay $2 in the end in order to return to their original destination. The destination rider’s fare will increase by a dollar but will give them the opportunity to stop at other locations versus a single destination for the $3 option.

“Three dollars is a deal,” Councilman Dennis Dare said. “You can’t buy a gallon of gasoline for $3.”

Dare pointed out two years ago the General Fund subsidized the Transportation Department’s budget by nearly $2 million and the council voted to cut the night hours of the buses operation during the off-season to decrease expenses. This year the General Fund is subsidizing transportation by about $1.7 million, which is equivalent to about two pennies on the current tax rate of 47 cents per $100 of assessed valuation, which is about 4 percent.

“If the average tax bill is about $1,000, that is $40, so taxpayers are paying $40 for the bus. They are subsidizing the bus ridership quite a bit … there is a fine line to balance — what is affordable and what isn’t and I really don’t think $3 is not affordable … I think we are being fair to the taxpayers who have to subsidize it by making a small adjustment here from $1 one way to $3 all day,” Dare said.

Knight made a motion to approve the advertising to provide an opportunity to request a public hearing on the proposed bus fare change, and the council vote 6-0, with Councilman Doug Cymek absent, to approve.

Councilwoman Margaret Pillas said as an Ocean City citizen she will be requesting a public hearing on the matter.

Councilman Brent Ashley encouraged residents to make note of the public hearing date and to make comments.

“I would hope that anybody in the community that has any input or any feelings about this will come forward and express those feelings,” Ashley said. “So often we have things come up that the public should be commenting on and nobody shows up.”