WILMINGTON, N.C. (WECT) - WAVE transit is in a cash crunch. Wilmington’s bus system relies on money from the federal, state and local government to operate, and some of that money hasn’t materialized as quickly as expected.
WAVE is waiting on about $1.2 million in guaranteed state and federal funding. Cash flow issues in Raleigh have caused $700,000 of the money WAVE was allocated in the state budget to be delayed, prompting the transit authority to seek a cash advance from the city and county.
“On behalf of Cape Fear Public Transportation Authority we are requesting a loan or cash advance of $700,000 on fiscal years 2021 funding,” Cape Fear Public Transportation Authority Finance Director Joseph Mininni wrote in an email to the city and county on Tuesday. “This request is in above and beyond any addition support being considering for fiscal year 2020. Without a loan or advance the Authority will be forced to suspend operations as soon as February 15th of this year.”
When asked about the potential of suspending bus service next month after the Transportation Authority’s board meeting on Thursday, WAVE Director Albert Eby downplayed the worst-case-scenario outlined in the email.
“We do have an agreement with the City of Wilmington that they will or they can give us cash advances or give us advances against some grants, so we’ve started the process of that, but no, we certainly don’t anticipate any interruption in service,” Eby said. He later added that WAVE learned Thursday the state would release $175,000 of the delayed funds this week to alleviate the cash shortage.
While that will provide some short term relief, it might not last long. Wilmington Mayor Bill Saffo expressed serious concerns about the request for a cash advance when WECT reached him by phone Thursday afternoon.
“This [request] was sent over to [council members] yesterday, and we were all taken by surprise,” Saffo said. He explained that a couple years ago, the city helped establish a fund balance for WAVE which he recalled to be about $800,000, to help the transit authority manage cash shortages in situations like this. He thought the city was supposed to be notified if that fund balance had to be depleted.
“Why is there no money in the fund balance?” Saffo wondered when asked about the proposed cash advance. “Are we going to be in the same situation in 6 months, 8 months?”
Eby and WAVE board members emphasized that public transportation is never a profitable venture, and relies on public funding to subsidize the service many residents rely on to get to their jobs and medical appointments. They said they are disappointed in implications by some local leaders that the authority’s financial issues are a result of mismanagement.
“Until people look at public transportation as a service like any other service the county provides, until they do that and stop thinking in terms of making our public transportation systems money makers then we are always going to have this problem,” Cape Fear Public Transportation Board Chairman Steven Kelly said.
Saffo said he expected a decision to be made about the request for a cash advance within two weeks.