North County Transit District (NCTD) staff will recommend that the board of directors authorize Executive Director Matthew Tucker to issue a Request for Proposals (RFP) for a private contractor to undertake NCTD's current bus operations and maintenance services.

The state of California's decision to eliminate State Transit Assistance funding for at least the next five years, combined with depressed sales tax revenues due to the severe downturn in the economy has created future annual deficits approaching $19 million.

In order to partially alleviate NCTD's financial situation, staff is recommending the board consider the complete outsourcing of bus operations and maintenance as a significant cost savings measure. Outsourcing these services would allow NCTD to maintain higher levels of bus service due to the anticipated lower operating costs typically associated with contracting.

The transit district is currently evaluating its entire business model to identify cost savings and opportunities to improve the riding experience.