The Kitsap Transit board of commissioners approved the 2026 operating budget as part of its Nov. 4 meeting, with transit fund operating expenses to anticipated to reach $69.65 million and ferry fund operating expenses to reach $28.7 million.
KT finance director Paul Shinners provided the board with additional context on why the transit fund expenses are larger than the ferry fund.
“It’s larger than we typically like to bring to the board, but 85% of that is salaries and wages, a large component of that (is from) Amalgamated Transit Union 587 (ATU587), the union representing routed and access drivers. We settled with ATU587 in basically a year and a half out of contract. We did come to terms with ATU587 in May of this year, so there was a bit of catch-up in terms of the wages that we were assuming in prior year budgets to this year’s budget,” he said.
The budget is broken down into a transit fund, which includes routed buses, and a fast ferry fund, which is separated due to different funding sources. KT also presents information to auditors and audited annual reports in this format, Shinners said.
Revenues from sales tax are the primary base of the agency’s operating revenue, while roughly 85% of non-discretionary funding goes to obligations such as general wage adjustments and benefits, he said. Shinners credits the previously approved ferry fare increases and removing the transfer credits to help stabilize operations on the ferry side.
“What you’re not seeing is approximately $300 million of unfunded projects in terms of replacement schedule for eight of our 10 vessels,” Shinners said. “That doesn’t mean that we’re not going to…apply and win for competitive grants.”
Shinners said KT has secured some funding for replacing two out of 10 vessels, including M/V Finest, used on the Seattle-Kingston fast ferry route.
Regarding ferry operations, Shinners said KT has a large bond issued in 2017, used to start up ferry operations and build the ferry fleet. The interest portion in 2026 is $600,000, with the principal portion being around $3.7 million debt service annually, the total required annual payments KT needs to make.
“Those bonds will mature in 2032 so we still do have a few more years, but that will become an important part of our conversation, a separate workshop that we’re suggesting for our long term outlook for ferries, mainly in terms of replacement schedule of our vessels, and a couple of large facility projects that we’re working on,” he said.
KT boardmember and BI Councilmember Clarence Moriwaki shared his support for growing ridership.
“One of the things we want to have is more ridership and the Day Road Park and Ride. For example, it’s just a gravel shoulder next to the road. It’s so uninviting for people to even want to participate in transit, and that’s throughout our whole system,” he said. “We have a lot of those rural places, such as next to a mailbox. It’s very important to make it something that is much more appealing for people that want to ride our buses.”
New bus contract
The board also approved an order for new routed buses from California-based Gillig, which includes four heavy-duty electric buses and seven clean diesel buses. The new buses will cost an estimated $12.6 million, KT executive director John Clauson said.
Clauson said the timeframe between order and delivery can be up to 18 months, and KT doesn’t pay for the buses before they are delivered; the expense may go towards the 2027 budget.
The board also approved a project with Puget Sound Energy to support work and equipment required for the future installation of 10 inductive chargers for the electric bus fleet at the Charleston Base in Bremerton. The project is estimated to cost $320,914, per agency documents.
