Legislature set to review private bus contract

Nassau County Executive Ed Mangano has approved a new contract with Veolia Transportation Inc. to take over operation of Long Island Bus, which is now run by the Metropolitan Transportation Authority.

The announcement came last week, but the five-year contract — which would rename the county’s bus service as the Nassau Inter-County Express, or NICE — still has to be approved and voted on by the County Legislature and the Nassau Interim Finance Authority, the state fiscal oversight board. The county had planned a public hearing on the matter on Thursday, but cancelled the hearing because of an error in a public notice. The hearing will likely take place next week.

The 300-page contract with Veolia is set to take effect on Jan. 1, 2012. The contract lays out how riders would be affected by the new bus provider. The current fare, $2.25, would not change in the first year of service; after Veolia’s first year under the contract, all rate hikes would need approval by the five-member Transit Committee, which is yet to be formed and which, according to the contract, is to comprise five members appointed by the county executive.

Veolia would also be able to adjust existing routes and eliminate up to six routes. The contract states, “During the first two quarters after the commencement date, up to six routes may be eliminated if such service is duplicative in that the majority of passengers on such route have access to another route within one mile.”

Additionally, the contract lays out how much the county is to contribute to the system. Under the MTA system, the county contributed a $9 million subsidy; in the 2012 county budget, $2.6 million is allotted for the new bus system. The proposed contract outlines the maximum obligation the county would owe Veolia to fund the system. The county would pay a fixed annual fee and a variable fee based on the number of hours that buses run. The combined maximum payment ranges from $106 million next year to $131 million if the contract is extended to 10 years. Potential funding sources include federal and state grants, fares and advertising revenue.