Operating Expenses are the expenses associated with the operation of the transit agency, and classified by function or activity and the goods and services purchased. It is the sum of either the functions or the object classes listed below.
A Function is an activity performed or cost center of a transit agency. The four basic functions are:
Vehicle Operations includes all activities associated with the subcategories of the vehicle operations function: transportation administration and support; revenue vehicle operation; ticketing and fare collection; and system security.
Vehicle Maintenance includes all activities associated with revenue and non-revenue (service) vehicle maintenance, including administration, inspection and maintenance, and servicing (cleaning, fueling, etc.) vehicles. In addition, vehicle maintenance includes repairs due to vandalism and accident repairs of revenue vehicles.
Non-Vehicle Maintenance includes all activities associated with facility maintenance, including: administration; repair of buildings, grounds and equipment as a result of accidents or vandalism; operation of electric power facilities; and maintenance of vehicle movement control systems; fare collection and counting equipment; structures, tunnels and subways; roadway and track; passenger stations, operating station buildings, grounds and equipment; communication systems; general administration buildings, grounds and equipment; and electric power facilities.
General Administration includes all activities associated with the general administration of the transit agency, including transit service development, injuries and damages, safety, personnel administration, legal services, insurance, data processing, finance and accounting, purchasing and stores, engineering, real estate management, office management and services, customer services, promotion, market research and planning.
An Object Class is a grouping of expenses on the basis of goods and services purchased. Object Classes are as follows:
Salaries and Wages are the pay and allowances due employees in exchange for the labor services they render in behalf of the transit agency. The allowances include payments direct to the employee arising from the performance of a piece of work. Also called "Labor."
Fringe Benefits are the payments or accruals to others (insurance companies, governments, etc.) on behalf of an employee and payments and accruals direct to an employee arising from something other than a piece of work. These payments are transit agency costs over and above labor costs, but still arising from the employment relationship.
Employee Compensation is the sum of "Salaries and Wages" and "Fringe Benefits."
Services include the labor and other work provided by outside organizations for fees and related expenses. In most instances, services from an outside organization are procured as a substitute for in-house employee labor, except in the case of independent audits which could not be performed by employees in the first place. The substitution is usually made because the skills offered by the outside organization are needed for only a short period of time or are better than internally available skills. The charge for these services is usually based on the labor hours invested in performing the service. Services include management service fees, advertising fees, professional and technical services, temporary help, contract maintenance services, custodial services and security services.
Materials and Supplies are the tangible products obtained from outside suppliers or manufactured internally. Freight, purchase discounts, cash discounts, sales and excise taxes (except on fuel and lubricants) are included in the cost of the material or supply. Charges to these expense are for the materials and supplies issued from inventory for use and for the materials and supplies purchased for immediate use, i.e., without going through inventory. These materials and supplies include tires, fuel and lubricants.
Utilities include the payments made to various utilities for utilization of their resources (e.g., electric, gas, water, telephone, etc.). Utilities include propulsion power purchased from an outside utility company and used for propelling electrically driven vehicles, and other utilities such as electrical power for purposes other than for electrically driven vehicles, water and sewer, gas, garbage collection, and telephone.
Casualty and Liability Costs are the cost elements covering protection of the transit agency from loss through insurance programs, compensation of others for their losses due to acts for which the transit agency is liable, and recognition of the cost of a miscellaneous category of corporate losses.
Purchased Transportation is transportation service provided to a public transit agency or governmental unit from a public or private transportation provider based on a written contract. The provider is obligated in advance to operate public transportation services for a public transit agency or governmental unit for a specific monetary consideration. Purchased transportation does not include franchising, licensing operation, management services, cooperative agreements or private conventional bus service.
Other Expenses is the sum of taxes, miscellaneous expenses, and expense transfers:
Total Expense is the sum of all the object classes or functions.
