The URL can be used to link to this page

Home My WebLink About01-20-26 GREATER ROANOKE TRANSIT COMPANY BOARD OF DIRECTORS January 12, 2026 Joseph L. Cobb, President, and Members of the Greater Roanoke Transit Company Board of Directors Dear President Cobb and Members of the Board: The regularmeeting.of the Greater Roanoke Transit Company Board of Directors will be held on Tuesday, January 20, 2026 at 12:30 p.m., in the C'L/E c 'g to Leo ,, ;,;oedIJ TWg Noel C. Taylor Municipal Building, 215 'Church Avenue, S. W., Roanoke, Virginia. Sincerely, el-te1-124—J-; Wfreerzr Cecelia F. McCoy Secretary c: Valmarie Turner, City Manager Angela O'Brien, Deputy City Manager Timothy Spencer, General Counsel, GRTC Laura M. Carini, Assistant General Counsel, GRTC Margaret A. Lindsey, Treasurer Troy A. Harmon, Municipal Auditor Kevin Price, General Manager, Valley Metro Ron Parker, Assistant General Manager, Valley Metro GREATER ROANOKE TRANSIT COMPANY BOARD OF DIRECTORS Tuesday, January 20, 2026 12:30 P.M. CITY MANAGER'S CONFERENCE ROOM ROOM 364 ACTION AGENDA 1. Call to Order— Roll Call —All present. 2. Approval of Minutes: Regular meeting of GRTC held on Monday, November 17, 2025. Without objection, the reading of the Minutes were dispensed with and approved. 3. A communication from the General Counsel, pursuant to Section 2.2-3711.A.8, Code of Virginia (1950), as amended, requesting that the Board of Directors of GRTC convene a closed meeting for consultation and legal counsel, where legal opinion is necessary. The Board concurred in the request of the General Counsel. (6-0) 4. Reports of Officers: A. Secretary: 1. A communication advising of the resignation of Andrew C. Keen as a Director of the Greater Roanoke Transit Company, Board of Directors, effective January 2, 2026. Communication received and filed. 2. Election of Vacancy on Board of Directors: • Richard W. Peters, Jr., to replace Director Andrew C. Keen. Richard W. Peters, Jr., was appointed as a Director to the Greater Roanoke Transit Company Board of Directors to fill the unexpired term of Andrew C. Keen ending June 30, 2026. 3. Election of Vacancy for Officer: • Edena Reese-Atmore to replace Treasurer Margaret Lindsey. Edena Reese-Atmore was appointed as Treasurer to the Greater Roanoke Transit Company Board of Directors to fill the unexpired term of Margaret A. Lindsey ending June 30, 2026. B. General Manager: a. TPAC Meeting Update b. GRTC Ridership Update c. GRTC Performance Statistics Without objection, the Management Update was received and filed. 5. Discussion of FY25-34 Transit Strategic Plan Performance Standards Brief discussion held. 6. GRTC External Audit Presentation Without objection, the External Audit Presentation was received and filed. 7. GRTC Financial Report Without objection, the Financial Report was received and filed. 8. Authorization to approve and adopt Fare Free Transit Equity Day Service—February 4, 2026. Adopted Resolution. (6-0) 9. Authorization to file for Federal Transit Administration Operating and Capital Financial Assistance; and Commonwealth of Virginia Operating and Capital Financial Assistance for Fiscal Year 2026-2027. Adopted Resolution. (6-0) 10. Other Business. Director D'Ardenne will meet with a gentleman to discuss transportation options to the Walmart Supercenter on Challenger Avenue in Bonsack, as well as the possibility of a Star Line Trolley route along Williamson Road into Roanoke County. 11. Closed Meeting. At 1:21 p.m., the President declared the Board meeting in recess for a closed meeting. At 1:39 p.m., the Board meeting reconvened in the City Manager's Conference Room, President Cobb presiding, and all members of the Board were in attendance. CERTIFICATION OF CLOSED MEETING: With respect to the Closed Meeting just concluded, Director D'Ardenne moved that each Member of the Board of Greater Roanoke (GRTC)certifies that to the best of each Member's knowledge(i)only public business matters lawfully exempted from open meeting requirements under Chapter 37 of Title 2.2 Code of Virginia, Virginia Freedom of Information Act; and (ii) only such public business matters as were identified in the motion by which any closed meeting was convened were heard, discussed or considered by the members of the Greater Roanoke Transit Company Board of Directors in attendance. The motion was seconded by Director Michalski-Karney and adopted by the following vote: AYES: Directors Crookshank, D'Ardenne, Dillon, Michalski-Karney, Sanchez- Jones and President Cobb-6. NAYS: None-0. 12. Next Meeting: Monday, March 16, 2026, at 12:30 p.m., in the HR Learning Center. 13. Adjourn. 1:40 p.m. CITY OF ROANOKE `54o OFFICE OF THE CITY.ATTORNEY David L.Collins 464 MUNICIPAL BUILDING v' Laura M.Carini �''f`��=. �� 215 CHURCH AVENUE,:SW. k,:z, ROANOKE,VIRGINIA 24011-1595 . Deputy City Attorneys ' I't TELEPHONE 540-853-2431 Jennifer Crook Braxton FAX 540-853-1221 . Kimberly P.Beamer Timothy R.Spencer EMAIL:timothy.spencer@roanokeva.gov Lalita Brim-Poindexter City Attorney Assistant City Attorneys January 20, 2026 The Honorable President and Members of the Board of Directors for GRTC = Roanoke,Virginia Re: Request for closed meeting Dear President CObb and Members of the Board of Directors: •_ V . This is to request, pursuant to Section 22-3711(A)(8), Code of Virginia (1950), as amended, that the.Board: of Directors of GRTC convene a closed meeting.for consultation with legal counsel,where legal opinion is necessary. With kindest personal regards, I am ' Sincerely yours, othy pencer Gene ounsel . TRS/arw e Town of Vinton �zFl 311 S.Pollard Street j;'J Vinton,VA 24179 . � '--'' Phone(540)983-0608 1� Fax(540)985-3105 r_s'i -n IETOWN OF VINTON ANDREW KEEN Finance Director/Treasurer v-t R o [ 23 [ •n • December 15`h,2025 Greater Roanoke Transit Company 215 Church Ave SE Roanoke,VA 24011 Dear President Cobb, I am writing this letter to officially give notice of resignation of my position of Director on the Greater Roanoke Transit Company (GRTC) Board, effective January 2nd, 2025. I am resigning from this position solely due to the acceptance of another position as Town Manager with the Town of Marion. I would like to take this opportunity to express how difficult of a decision this was for me personally. Ultimately, the deciding factor in my decision was a rare opportunity to move closer to family and to serve in my hometown community. It has been an honor to serve on the GRTC Board, and I look forward to seeing the continued successes of the authority for years to come. Sincerely, ANDREW C. KEEN C.. '" F ' mane Director ::''�*T Town of Vinton 03,^"- _., 311 S.Pollard Street ' , Vinton,VA 24179 .. : 1°-" Phone(540)983-0607 ,,,r _ Fax(540) 983-0626 THE TOWN OF VINTON VIRGINIA January 7, 2026 Ms. Susie McCoy, Clerk City of Roanoke 215 Church Avenue, SW Noel C. Taylor Municipal Building __ - Suite-456- - - --___ _ _ - -- -_--- -- -- - -----= --- _ - _._ Roanoke, VA 24011-1536 RE: Greater Roanoke Transit Company Board Appointment Dear Ms. McCoy: This letter is written to confirm that Andrew Keen,Finance Director, was re-appointed by Town Council at their June 3,2025,meeting as our GRTC Board Member for the term beginning July 1,2025, and ending June 30, 2026. Mr. Keen has ended his employment with the Town of` Vinton; therefore, Richard W. Peters, Jr., was appointed by Town Council at their January 6, 2026, meeting as our GRTC Board Member for the remaining of the term that ends on June 30, 2026. If you have any questions,please contact me. Very truly yours, ing4.0(M - -- - - _ __. -- --- Megan Lawless�:... _ - - - -- -- - Town Clerk GREATER ROANOKE TRANSIT COMPANY BOARD OF DIRECTORS January 20, 2026 Richard W. Peters, Jr. 311 S. Pollard Street Vinton, Virginia 24179 Dear Mr. Peters: At the regular meeting of the Greater Roanoke Transit Company held on Tuesday, January 20, 2026, you were appointed as a Town of Vinton representative member of the Greater Roanoke Transit Company Board of Directors to fill the unexpired term of office of Andrew C. Keen, ending June 30, 2026. Enclosed you will find a Certificate of your appointment and an Oath or Affirmation of Office which must be administered by a Clerk of the Circuit Court of the City of Roanoke, located on the third floor of the Roanoke City Courts Facility, 315 Church Avenue, S. W. Please return one copy of the Oath of Office to Room 456 in the Noel C. Taylor Municipal Building, 215 Church Avenue, S. W., prior to serving in the capacity to which you were appointed. Pursuant to § 2.2-3702 of the Code of Virginia (1950), as amended, a copy of the Virginia Freedom of Information Act will be emailed to you following the January 20, 2026 meeting. The Act requires that you be provided with a copy within two weeks of your appointment and that you read and become familiar with its provisions. Sincerely, c' /GC 0 Cecelia F. McCoy, CMC Secretary Enclosures COMMONWEALTH OF VIRGINIA ) To-wit: CITY OF ROANOKE ) I, Cecelia F. McCoy, City Clerk, and as such Secretary of the Greater Roanoke Transit Company Board and keeper of the records thereof, do hereby certify that at a regular meeting of the Greater Roanoke Transit Company Board of Directors held on the twentieth day of January 2026, Richard W. Peters, Jr. was appointed as a Member of the Greater Roanoke Transit Company Board of Directors for a term of office ending June 30, 2026. Given under my hand and the Seal of the Greater Roanoke Transit Company this twentieth day of January 2026. Secretary Oath or Affirmation of Office Commonwealth of Virginia, City of Roanoke, to-wit: I, Richard W. Peters, Jr., do solemnly swear or (affirm) that I will support the Constitution of the United States of America and the Constitution of the Commonwealth of Virginia, and that I will faithfully and impartially discharge and perform all the duties incumbent upon me as a Director of the Greater Roanoke Transit Company Board of Directors for a term of office ending June 30, 2026, according to the best of my ability. So help me God. RICHARD W. PET S, JR. The foregoing oath of office was taken, sworn to, and subscribed before me by Richard W. � Peters, Jr. this \(O day of_1v��,( 2026. Brenda S. Hamilton, Clerk of the Circuit Court B azIe - ` , Clerk GREATER ROANOKE TRANSIT COMPANY BOARD OF DIRECTORS January 20, 2026 Edena Reese-Atmore Interim Director of Finance Roanoke, Virginia Dear Ms. Reese-Atmore: At a regular meeting of the Greater Roanoke Transit Company Board of Directors held on Tuesday, January 20, 2026, the Interim Director of Finance was appointed as Treasurer of the Greater Roanoke Transit Company Board of Directors for a term ending June 30, 2026. Enclosed you will find a Certificate of your appointment and an Oath or Affirmation of Office which must be administered by a Clerk of the Circuit Court of the City of Roanoke; located on the third floor of the Roanoke City Courts Facility, 315 Church Avenue, S. W. Please return one copy of the Oath of Office to Room 456 in the Noel C. Taylor Municipal Building, 215 Church Avenue, S. W., prior to serving in the capacity to which you were appointed. Pursuant to § 2.2-3702 of the Code of Virginia (1950), as amended, a copy of the Virginia Freedom of Information Act will be emailed to you following the January 20, 2026 meeting. The Act requires that you be provided with a copy within two weeks of your appointment and that you read and become familiar with its provisions. Sincerely, Cecelia F. McCoy, CMC Secretary Enclosures COMMONWEALTH OF VIRGINIA ) To-wit: CITY OF ROANOKE ) I, Cecelia F. McCoy, City Clerk, and as Secretary of the Greater Roanoke Transit Company Board and keeper of the records thereof, do hereby certify that at a regular meeting of the Greater Roanoke Transit Company Board of Directors held on the twentieth day of January 2026, the Interim Director of Finance(Edena Reese=Atmore) was appointed as Treasurer of the Greater Roanoke Transit Company Board of Directors for a term of office ending June 30, 2026. Given under my hand and the Seal of the Greater Roanoke Transit Company this twentieth day of January 2026. (614-61j, Secretary PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transft Company Comments on Internal Control and Other Suggestions for Your Consideration June 30, 2025 U U BROWI EDWARDS :_J certified public accountants PRELIMINARY DRAFT-OPEN FOR REVIEW AND DISCUSSION ONLY U Greater Roanoke Transit Company Contents Independent Auditor's Report on Comments and Suggestions 1 Comments and Suggestions Resulting from the Current Year Audit 3 Prior Year Comments and Other Suggestions 4 Accounting and Other Matters 7 U PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY ROWNEDWS certified public accountants Independent Auditor's Report on Comments and Suggestions Board of Directors Greater Roanoke Transit Company Roanoke,Virginia In planning and performing our audit of the financial statements of the Greater Roanoke Transit Company (the "Company") as of and for the year ended June 30, 2025, in accordance with auditing standards generally accepted in the United States of America, we considered its internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinion on the financial statements and to comply with •— any other applicable standards, such as Government Auditing Standards and the regulations set forth in the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we do not express an opinion on the effectiveness of the entity's internal control. Our consideration of internal control was for the limited purpose described in the first paragraph and was _ not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and, therefore, material weaknesses or significant deficiencies may exist that were not identified. In addition, because of inherent limitations in internal control, including the possibility of management override of controls,misstatements due to error or fraud may occur and not be detected by such controls. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions,to prevent, or detect and correct,misstatements on a timely basis. A material weakness is a deficiency,or a combination of deficiencies,in internal control such that there is a reasonable possibility that a material misstatement �- of the entity's financial statements will not be prevented,or detected and corrected on a timely basis. A significant deficiency is a deficiency,or a combination of deficiencies,in internal control that is less severe than a material weakness,yet important enough to merit attention by those charged with governance. Certain significant deficiencies and a material weakness were identified during our procedures that are included in the Independent Auditor's Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards and the Independent Auditor's Report on Compliance for Each Major Program and on Internal Control over Compliance Required by the Uniform Guidance which should be read in conjunction with this report. Additionally,during our audit,we have become aware of certain other matters that provide opportunities for improving your financial reporting system and/or operating efficiency. Such comments and suggestions regarding these matters, if any, are also included in the attached report, but are not designated as a material weakness or significant deficiency. Since our audit is not designed to include a detail review of all systems and procedures, these comments should not be considered as being all- inclusive of areas where improvements might be achieved. We also have included information on www.becpas.com IMO • PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY accounting and other matters that we believe is important enough to merit consideration by management and those charged with governance. It is our hope that our suggestions will be taken in the constructive light in which they are offered. We have already discussed these comments and suggestions with management, and we will be pleased to discuss them in further detail at your convenience,to perform any additional study of these matters, or to assist you in implementing the recommendations. The entity's responses to our recommendations are included in this report. The responses were not subjected to the auditing procedures applied in the audit of the financial statements and,accordingly,we express no opinion on them. This communication is intended solely for the information and use of the Company, management, and the appropriate state and federal regulatory agencies and is not intended to be, and should not be, used by anyone other than these specified parties. CERTIFIED PUBLIC ACCOUNTANTS Roanoke,Virginia - 9 2026 r.. IMO 2 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company IMO Comments and Suggestions Resulting from the Current Year Audit June 30,2025 Grant Management and Operating Assistance (Significant Deficiency) During 2025, we noted that grant reimbursements were not submitted routinely. On 15 of 25 Transit Cluster disbursements tested, a reimbursement request was not made to cover these disbursements until at least 90 days after the disbursement had been paid. Of these 15 instances, three did not have a reimbursement request completed for at least 90 days and were requested after the fiscal year had ended. We also noted two instances where a vendor was not paid for over 30 days. Internal controls related to financial management should be designed to ensure timely submission of reimbursement requests and payment of vendors.We recommend that the Company establish financial management procedures to ensure the timely submission of reimbursement requests and payment of vendors. Management's Response: GRTC acknowledges this finding and will continue to address this issue via updated grant management processes and training additional finance staff on grant writing,pre-award and post-award activities. WIN IMP OMNI AIM IMO PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company Prior Year Comments and Other Suggestions June 30,2025 Segregation of Duties and Management Oversight (Material Weakness) One of the more important aspects of any internal control structure is the segregation of duties. In an ideal system of internal controls, no individual would perform more than one duty in connection with any transaction or series of transactions. In particular, no one individual should have access to both physical assets and the related accounting ▪ records. Such access may allow errors or irregularities to occur and either not be detected or concealed. Due to staff turnover during the year,duties handled by finance staff included incompatible duties such as: • Director of Finance and Accounting Supervisor have the ability to collect cash,post receipts to general ledger,and prepare bank deposit slips. When walking through relevant controls over these functions,we also noted the following matters: • During our review of the segregation of duties,we noted that the Director of Finance and the Accounting Manager both collect cash, post receipts to general ledger,and prepare bank deposit slips. Current Status:No longer applicable. These duties were segregated during the fiscal year ended June 30,2025. Grant Management and Operating Assistance (Material Weakness) During 2022, various functions related to financial management were not performed timely resulting in difficulties and ▪ delays in completion of the annual audit, including the need to prepare material audit adjustments to both the current year financials and a restatement to prior year balances. Internal controls related to financial management should be designed to ensure timely reconciliations are performed,including submission of reimbursement requests and reconciling WWI grant and local revenue. Timely and effective reconciliations ensure the financials provided for the annual audit are provided based on the agreed upon schedule with the auditors which allows timely inclusion in the City's financial report as well as to meet federal reporting deadlines. In addition,these reconciliations will ensure that financials do not require adjustments by the auditors. Turnover in financial positions, increased levels of federal and state grants, and implementation of a new financial software caused significant delays in performance and reduction in effectiveness of certain financial duties. We recommend that the Company establish financial management procedures to ensure that _ timely reconciliations and submissions of reimbursement requests. We would recommend these procedures be performed monthly and include tracking and reconciling grant activity by type(federal,state,and local). Current Status:Portions of this finding are no longer applicable.See modified significant deficiency added in current year ▪ to reflect current year status. Payroll Reconciliation During our review of payroll expenses, we noted that federal quarterly 941 reports provided by the external payroll processing company are not reconciled to the general ledger.We recommend reconciling payroll reports such as, but not limited to, the 941 reports throughout the year to ensure that all payroll records are accurate and complete. We also recommend a segregation of duties between the reconciliation preparer and the supervisor reviewing as well as documenting who and when the reconciliation was performed. Current Status:Still applicable. 4 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company Prior Year Comments and Other Suggestions June 30,2025 Management Response:Effective in the second half of FY26(January)GRTC implemented a quarterly reconciliation process between Federal 941 submissions from ADP and payroll reports for internal distribution purposes only that are based on the general ledger. The Accounting Supervisor performs the reconciliation,signs and dates it while the Director of Finance will review and sign off on such quarterly work. Grant Management Training Several prior period adjustments and delays in the audit were related to reconciling grants receivable and grant revenue at year end. We recommend grant training for Company accounting staff. More specifically, we recommend training related to timely drawdowns,cash flow management, methods for tracking grants received and spent on a regular basis, reconciling grant reports to the general ledger, proper treatment of funding received and tracked as unearned revenue, and compliance with federal and state requirements. Current Status: No longer applicable. No prior period adjustments considered necessary related to grants receivable or grant revenue at year end. • Board Approval of Financial Statements IMO In our review of board minutes,we noted that monthly or quarterly.financial statements were not presented to the board U during the fiscal year. We recommend the finance department provide financial statements to the board ahead of the meeting and formally present them during the meeting. Board review, discussion, and approval of financial statements provides a necessary level of internal control and transparency. Current Status:No longer applicable a Timeliness of Bank Reconciliations (Material Weakness) During our review of bank reconciliations, we noted that bank reconciliations were not prepared by an accountant and reviewed and approved by a supervisor in a timely manner.We recommend that bank reconciliations be prepared by the 15th of the next month and be reviewed by a supervisor to ensure unreconciled or unusual items,or other matters noted in the reconciliation,are detected and addressed in a timely manner. Current Status:Still applicable but downgraded to a significant deficiency in 2025. Interim Director of Finance turned over in March 2025 which led to delays in the preparation of bank reconciliations. We noted that the bank reconciliations in 2025 were completed more timely than in previous years, noting that the June 2025 bank reconciliation was performed in August 2025. Management Response: The Director of Finance performs monthly bank reconciliations in FY26 in a timely manner. Specifically,the dates for completion and sign off on the operating bank reconciliation for the first five months of FY26 are as follows:July:9/22/2025;August:10/06/2025;September:11/06/2025;October:11/19/2025;November:12/15/2025; December—In process. Kevin Price, General Manager,needs to perform the review of such bank reconciliations in a timely manner and document such review and approval with his endorsement on the face of the reconciliation by the end of the following month no later than 30 days after the bank statement date. LJ 5 —• PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company Prior Year Comments and Other Suggestions June 30,2025 Inventory (Material Weakness) During our review of inventory,we noted that the inventory manager has access to physical inventory and the inventory tracking system.Access to the physical inventory and the inventory tracking system by a single individual creates risk that include errors, unintentional losses, and misappropriation of assets. We recommend that the Company implement compensating controls to provide reasonable assurance that the assets are physically accounted for, transactions are properly recorded, and the inventory balances are correct. The inventory manager should not both have the ability to delete or change transactions in the inventory system and access to the physical inventory. Current Status:Still applicable. Management Response:In our opinion the inventory function, as it stands, has satisfactory safeguards in place to prevent misappropriation of assets,fraudulent financial reporting and/or material misstatements due to error. However, after collaborating with the inventory team a compensating control has been implemented which strips the two inventory clerks ability to adjust inventory quantities in the inventory sub-ledger(RTA).Further, the director himself will perform all system adjustments at the behest of the two inventory clerks. Given a staff of four(4)there will still exist individual simultaneous access to both physical inventory and system adjustments by the director however such access is warranted in the case of - having a backup for staff turnover and/or extended absences. Accrued Paid Time Off During our audit of the client's accrued vacation and paid time off(PTO) balances for administrators and operators, we noted an inconsistency between employee handbooks and operators' union contract.The operators' union contract and r the employee handbook both included a clause that states employees can carryforward a maximum of 192 hours. We noted in our testing of PTO balances that one operator exceeded the bargain contract and several administrators are carrying unusually high balances.We recommend enforcing a payout policy for any excess balances each year. Current Status:Still applicable. In the current year, there were 8 union employees that had year-end PTO balances over 192 hours and 7 administrators had year-end vacation balances over 192 hours. Management Response: An official company memo was drafted by Human Resources and approved by Management which includes a few different payout settlement solutions. After much deliberation involving the finance function, the decision to pay these balances out in a lump sum was made as this avenue was deemed to be the most administratively feasible option for the company. Excess amounts owed are scheduled to be paid out in full on the January 22, 2026 pay date. Trade Receivables and Revenue— Billing (Material Weakness) During the audit, we noted that there were multiple customer accounts that were not billed throughout the year as services were provided by the Company.This could lead to year-end receivables and revenue not being properly stated, ,..� receivables potentially becoming uncollectible, and creates cash flow management difficulties. We recommend that the Company bill customers for services rendered in a timely manner to improve cash flow and prevent collection issues. Current Status:No longer applicable. 6 PRELIMINARY DRAFT—OPEN FOR REVIEW AND O DISCUSSION NLY Greater Roanoke Transit Company Accounting and Other Matters June 30,2025 Current GASB Projects GASB currently has a variety of projects in process.Some of these projects are discussed below. Going Concern Uncertainties and Severe Financial Stress. The objective of this project is to address issues related to ▪ disclosures regarding going concern uncertainties and severe financial stress.The project will consider(1) improvements to existing guidance for going concern considerations to address diversity in practice and clarify the circumstances under which disclosure is appropriate, (2) developing a definition of severe financial stress and criteria for identifying when ▪ governments should disclose their exposure to severe financial stress, and (3) what information about a government's exposure to severe financial stress is necessary to disclose.This project is currently in the initial deliberations period. Implementation Guidance Update - 2025. The objective of this project is to update implementation guidance for additional issues that come to the attention of the staff.This project will result in the issuance of an Implementation Guide when sufficient need exists for new or improved guidance and the Board does not object to its issuance. All updates are incorporated into the Codification of Governmental Accounting and Financial Reporting Standards and the Comprehensive Implementation Guide,as appropriate.This project is currently in the preliminary views period. Infrastructure Assets. The objective of this project is to address issues related to accounting and financial reporting for infrastructure assets.The project would evaluate standards-setting options related to reporting infrastructure assets to make information (1) more comparable across governments and more consistent over time, (2) more useful for making decisions and assessing government accountability, (3) more relevant to assessments of a government's economic condition, and (4) better reflect the capacity of those assets to provide service and how that capacity may change over time.This project is currently in the preliminary views re-deliberation period. - Revenue and Expense Recognition.The objective of this project is to develop a comprehensive application model for the classification, recognition, and measurement of revenues and expenses. The purpose for developing a comprehensive model is (1)to improve the information regarding revenues and expenses that users need to make decisions and assess accountability, (2)to provide guidance regarding exchange and exchange-like transactions that have not been specifically addressed,(3)to evaluate revenue and expense recognition in the context of the conceptual framework,and(4)to address application issues identified in practice, based upon the results of the pre-agenda research on revenue for exchange and exchange-like transactions.This project is currently in the preliminary views re-deliberations period. Subsequent Events. The objective of this project is to improve the accounting and financial reporting for subsequent events.The project will reexamine existing requirements related to subsequent events in Statement No. 56, Codification of Accounting and Financial Reporting Guidance Contained in the AICPA Statements on Auditing Standards, to address issues related to (1) confusion about and challenges associated with applying the existing standards, (2) inconsistency in practice in the information provided about subsequent events,and (3)the usefulness of the information provided about subsequent events.This project is currently in the exposure draft period. n ow Imo PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company (A Component Unit of the City of Roanoke, Virginia) Financial Report June 30, 2025 SBROWNEDWARDS cei lifted public uecauututtt — PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY — Greater Roanoke Transit Company (A Component Unit of the City of Roanoke, Virginia) — Contents — Introductory Section Organizational Chart i — Financial Section Independent Auditor's Report 1 — Management's Discussion and Analysis (Unaudited) 5a Basic Financial Statements — Statements of Net Position 6 Statements of Revenues, Expenses, and Changes in Net Position 7 — Statements of Cash Flows 8 Notes to Basic Financial Statements 9 — Compliance Section Schedule of Expenditures of Federal Awards 21 — Notes to Schedule of Expenditures of Federal Awards 22 Independent Auditor's Report on Internal Control over Financial Reporting and — on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards 23 Independent Auditor's Report on Compliance for Each Major Program and on — Internal Control over Compliance Required by the Uniform Guidance 25 Summary of Compliance Matters 28 — Schedule of Findings and Questioned Costs 29 Schedule of Prior Audit Findings 34 — PRELIMINARY DRAFT-OPEN FOR REVIEW AND DISCUSSION ONLY Introductory Section Greater Roanoke Transit Company Organizational Chart 2025 Director of General Manager ProcurementiDBF Accountable Director of Finance t iaison officer Executive Solicitation Director of Human Resources Accounting Purr.hassnq Agwrt Assistant General Supervisor Director ofTran sit Manager CSO Planning&Special EEO&Title VI Officer Accounting Associate-AR Human Resource Specialist Accounting Associate -AP Director of k,� fllr octal A:..".:. Transportation Maintenance acisties Assistant Supervisor Assistant Director Director of of Maintenance Transportation Network Administrator Customer Inventory _Training and Safety Service Lead control Clerk Parts Clerk Coordinator Representatives Custodian Technical Support TRANSPORTATION Facilities Mechanics SUPERVISORS Custodians Veil Baty ...`Paratran sit Specialist& Operations Coordinator Bus Operators Bus Cleaners rroanotic, W'rrgtnrr 1 PRELIMINARY DRAFT-OPEN FOR REVIEW AND DISCUSSION ONLY Financial Section The Financial Section contains the Basic Financial Statements . PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY BROWNEDWARDS irtiJir�!�'tihiiC ruC:'utlfurrt Independent Auditor's Report To the Honorable Members of the Board of Directors Greater Roanoke Transit Company Roanoke,Virginia Report on the Audit of the Financial Statements Opinion We have audited the accompanying basic financial statements and the related notes to the financial '— statements, as listed in the table of contents, of the Greater Roanoke Transit Company(the "Company"), a component unit of the City of Roanoke,Virginia,as of and for the years ended June 30, 2025 and 2024. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the Company, as of June 30, 2025 and 2024, and the respective changes in financial position and cash flows thereof for the years then ended in accordance with accounting — principles generally accepted in the United States of America. Basis for Opinion _ We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, ` issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report.We are required to be independent of the Company and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Change in Accounting Principle — As described in Note 1 to the financial statements, in 2025, the Company adopted new accounting guidance,GASB Statement No. 101,Compensated Absences;GASB Statement No.103,Financial Reporting Model Improvements; and GASB Statement No. 104, Disclosure of Certain Capital Assets. Our opinion is not modified with respect to this matter. Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or _ error. www.becpas.com "' PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY ■. In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern for twelve months beyond the financial statement date, including any - currently know information that may raise substantial doubt shortly thereafter. Auditor's Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate,they would influence the judgment made by a reasonable user based on the financial statements. In performing an audit in accordance with generally accepted auditing standards and Government MIN Auditing Standards,we: • Exercise professional judgment and maintain professional skepticism throughout the audit. _ • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining,on a test basis, evidence regarding the amounts and disclosures in _ the financial statements. • Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. Accordingly, no such opinion is expressed. • Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. • Conclude whether, in our judgment,there are conditions or events,considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern for a �- reasonable period of time. We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit,significant audit findings, and certain internal control-related matters that we identified during the audit. Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management's discussion and analysis be presented to supplement the basic financial statements. Such information is IMP the responsibility of management, and, although not a part of the basic financial statements, is required 2 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic,or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America,which consisted of inquiries of management about the methods of preparing the information and comparing the _ information for consistency with management's responses to our inquiries,the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide _ us with sufficient evidence to express an opinion or provide any assurance. Supplementary Information Our audit was conducted for the purpose of forming an opinion on the financial statements that collectively comprise the Company's basic financial statements.The schedule of expenditures of federal awards is presented for purposes of additional analysis as required by Title 2 U.S. Code of Federal Regulations(CFR)Part 200,Uniform Administrative Requirements,Cost Principles,and Audit Requirements for Federal Awards (Uniform Guidance), and is also not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements.The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion,the schedule of expenditures of federal awards is fairly stated in all material respects in relation to the basic financial statements as a whole. Other Information _ Management is responsible for the other information included in the annual report.The other information comprises the introductory section but does not include the basic financial statements and our auditor's _ report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon. In connection with our audit of the basic financial statements, our responsibility is to read the other information and consider whether a material inconsistency exists between the other information and the basic financial statements, or the other information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected material misstatement of the other NOM information exists,we are required to describe it in our report. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated , 2026, on our consideration of the Company's internal control over financial reporting and _ on our tests of its compliance with certain provisions of laws,regulations,contracts,and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal 3 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY NM ism control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the Company's internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards — in considering the Company's internal control over financial reporting and compliance. CERTIFIED PUBLIC ACCOUNTANTS Roanoke,Virginia , 2026 MO MEM MmI WEN VS IR Om IMO mow Inir PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company — (A Component Unit of the City of Roanoke, Virginia) Management's Discussion and Analysis (unaudited) — Years Ended June 30, 2025 and 2024 Overview of the Financial Statements The management of the Greater Roanoke Transit Company(the"Company")offers readers of our financial _ statements the following narrative overview and analysis of our financial activities for the Years Ended June 30, 2025 and 2024. The following should be read in conjunction with our financial statements and notes thereto. AIM The financial statements of the Company reflect the transit operations of the Company. Our financial statements are prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America ("GAAP"). Our financial statements include the following components: • Statements of Net Position, which presents information on the assets and liabilities of the — Company, with the resulting difference between the two reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the Company is improving or deteriorating. • Statement of Revenues, Expenses, and Changes in Net Position, which reports revenues and expenses, classified as operating, non-operating, non-capital subsidies and capital contributions _ for the period.The resulting change in net position for the period is combined with the beginning of the year total net position balance in order to reconcile to the end of the year total net position on the Statement of Net Position. • Statements of Cash Flows, which reports the cash flow experienced by the Company from operating, noncapital financing, capital and related financing, and investing activities. The net _ result of the cash provided by or used in these activities for the period,added to the beginning of the year cash and cash equivalents balance, reconciles to the cash and cash equivalents balance presented on the Statement of Net Position for the end of the year. • Notes to the Basic Financial Statements,which explain and provide additional information on the data presented in the financial statements as of and for the Years Ended June 30, 2025 and 2024. 5a -- —' PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company (A Component Unit of the City of Roanoke, Virginia) Management's Discussion and Analysis (unaudited) Years Ended June 30,2025 and 2024 Financial Summary The below tables include summarized financial data presented within the Financial Statements. The Summary Statement of Net Position (Table 1) below presents comparative information year over year between the components that make up the Company's Net Position. Assets and liabilities are broken out into their current and long-term components with equity likewise delineated. Summary Statement of Net Position Fiscal Year Fiscal Year 2025 Increase 2024 Increase 2025 2024 2023 2022 2021 (Decrease" (Decrease" Current Assets $ 3,721.898 $ 5.019,065 $ 5.346.993 $ 6.069.160 $ 5.246.964 $ (1.297.167) $ (327,928) Restricted Cash.ARPA 476,420 1.713.830 - - - (1,237,410) 1,713,830 Capital Assets,Net 29.994,862 29,730,396 29,840,782 23,222,163 16.577.151 264,466 (110,386) Total Assets 34,193,180 36,463,291 " 35.187,775 " 29,291.323 21,824,115 (2,270.111) 1.275,516 Current Liabilities 1,607.076 3.335,618 4,318.555 4.097.628 2.760.697 (1.728.542) (982.937) Long-Term Liabilities 115.162 235.212 - (120.050) 235.212 Total Liabilities 1.722,238 3.570.830 4.318.555 4,097,628 2.760,697 ' (1,848.592)r (747,725) Investment in Capital Assets 29,911,573 29,730,396 27.158,242 21,092,950 16.577.151 181,177 2.572.154 Unrestricted 2,559,369 3,162,065 3,710,978 4.100,745 2.486.267 (602,696) (548,913) Total Net Position $32,470,942 $32,892,461 $30,869,220 $25,193,695 $19,063,418 $ (421,519) $ 2,023,241 IMM The Summary Statement of Changes in Net Position(Table 2)further spells out year over year comparative information centering on the revenue and expense components that change net position on an annual, operating basis. Summary Statement of Changes in Net Position ter Fiscal Year 2025 Fiscal Year 2024 29 2422 2423 Change Change Total Operating Revenues $ 1.568,555 $ 1.406,986 $ 1.442.638 $ 1.355.563 $ 1.239.573 161,569 (35.652) Total Operating Expenses (17.645,319) (17.166,280) 114,948,120) (13.387,660) (12.710,003) (479,039) (2,218,160) tem Total Non-Capital Subsidies 3.025.262 3,014,028 - - - 11.234 3,014.028 Total Net Non-Operating Revenues 9.558.960 11.071.705 10,938.784 10,154,897 11.700.661 (1.512,745) 132.921 Capital Contributions 3,071,023 3,696,802 8.357,396 7,604.863 2,388.134 (625,779) (4.660,594) Changes in Net Position (421,519) 2,023.241 5.790,698 5.727.663 r 2,618,365 (2,444,760)' (3.767,457) Ending Net Position $ 32.470.942 $ 32.892.461 $30.869,220 $ 25.193.695 $ 19,063.418 (421.519) 2,023,241 ewe IMO 5b PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company — (A Component Unit of the City of Roanoke, Virginia) Management's Discussion and Analysis (unaudited) — Years Ended June 30, 2025 and 2024 The Summary Statement of Revenues(Table 3)depicts comparative year over year information on specific — revenue only components breaking them down into specific line items under operating, non-operating and capital related. Summary Statement of Revenues — Fiscal Year 2025 Fiscal Year 2024 2421 2421 2421 2422 2421 Change Change Qperating Remnues: — Passenger Fares $ 1,073,819 $ 1.037,554 $ 1,052226 $ 1,003.055 $ 971.135 36.265 (14,672) Smart Way Fares 17.837 17.651 21,380 20,725 10,488 185 (3328) Student Fares 8 Other 1,972 1,912 919 2.266 944 59 994 S.T.A.R.Fares 127,566 122,705 109.133 83.907 71,195 4,861 13,572 MetroFlex 4,890 1,899 - - - 2.991 1,899 — Advertising 187227 148.335 144.854 179.942 124,665 Parking Income Rental Income - 11.000 47.073 61,147 Miscellaneous 155,245 76.930 103.127 18.593 - Total Operating Revenues $ 1.568.555 S 1,406.986 $ 1.442.638 $ 1,355.563 $ 1.239,573 S 44,361 S (1.936) Non-Operating Revenues: Non-Capital Subsidies $ 3,025.262 S 3,014,028 $ 10,953,806 8 10,143.210 S 11.671,790 11.234 (7,939,778) Federal and State Grants 9,529,760 10.999.556 - - - (1.469,796) 10,999,556 Parking Income - - - 10,800 27.360 - - Interest Income 2,207 1,867 2,605 1204 1,511 340 (738) Gain on Disposal of Capital Asset.Net 26,993 70.282 (17,627) (317) - (43,289) 87,909 Total Net Nonoperating $ 12.584.222 $ 14,085.733 $ 10,938.784 S 10154.897 S 11,700.661 ' (1.501.511)r 3.146,949 Capital Contributions: 3,071,023 3.696,802 8.357,396 7,604,863 2.388.134 (625,779) (4,660,594) Total Revenues $ 17,223,800 $ 19,189,521 $ 20,738.818 $ 19,115,323 $ 15,328,368 (2,082,929) (1,515,581) This Statement of Operating Expenses (Table 4) details all expenses on a comparative year over year basis _ summarized by Department, or functional group. Summary of Expenses-By Department/Function Fiscal Year Fiscal Year _ 3935 2424 293 2022 2021 2025 Change 2024 Change Operating Expenses: Transportation 6,519.794 6,042,763 5.585.862 4,861,990 5.061,573 477.031 456.901 Vehicle Maintenance 1,279,264 1.549,934 1.179,552 1,100.737 1,127,394 (270,670) 370.382 Nonvehicle Maintenance 313,175 332,822 262,260 317,179 342,744 (19.647) 70,562 Finance 316,941 349,322 303.166 346,895 48.311 (32,381) 46,156 Human Resources 8,749 2,283 11.130 17,755 875 6,466 (8.847) Planning 30,000 - - 19 - 30.000 - .� Procurement 3,313 - - 2,679 - 3,313 - Administration 9,174,083 8,889.156 7.606,150 6,740.406 6,129,106 284.927 1,283,006 Total Operating Expenses $ 17,645,319 $ 17.166,280 $ 14,948,120 $ 13.387.660 '$ 12,710.003 479,039 2.218,160 OM minmi 5c — PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company (A Component Unit of the City of Roanoke, Virginia) Management's Discussion and Analysis (unaudited) IIIP Years Ended June 30,2025 and 2024 This Statement of Operating Expenses (Table 5)offers a more specific analysis of expenses by type year over year. Summary of Expenses-By Classiciation Fiscal Year Fiscal Year 2025 2024 2023 2022 2021 2025 Change 2024 Change Operating Expenses: Salaries and Wages 5.228,579 5.193,709 4.984,832 3.993,163 4.457,365 34,870 208,877 Fringe Benefits 2,029,594 1.811,429 2.105,265 2.012,138 1.570,813 218,165 (293,836) Services 930.638 1,147.944 905,668 872,089 648,239 (217.306) 242,276 Materials&Supplies 1.223,329 1.476,721 989,702 1,101.336 1,153,316 (253,392) 487,019 insurance 283.771 252,931 279,709 258,191 248,576 30,840 (26,778) Utilities 236,208 221.331 196,284 194.667 195,732 14,877 25,047 Purchased Services&Other 4,679.161 4,169,986 3.502.541 2,771,774 2,062,120 509,175 667,445 MIP Depreciation 3.034,039 2,892.229 1.984.119 2.184.302 2,373,841 141.810 908.110 Total Operating Expenses '$ 17,645,319 $ 17.166.280 '$ 14,94,9,120 '$ 13.387,660 '$ 12,710,003 479,039 2,218.160 A comprehensive examination of these tables is available in the following section. Detailed Analysis In this section, we will analyze the Company's financial position and results of operations for FY25 and FY24 and further summarize significant changes as reported in the basic Financial Statements. The following major financial highlights are of note for the Years Ended June 30, 2025 and 2024. Fiscal Year 2025 • Assets exceeded liabilities by$32,470,942 (net position) as of June 30, 2025. $2,559,369 of net position is considered unrestricted and available to meet ongoing and future obligations of the Company, including its share of capital projects. • Net position decreased $421,519 or 1% for the year ended June 30, 2025 from the year ended June 30, 2024.The unrestricted portion of net position fell $602,696(19%)and the investment in capital assets portion of net position grew by$181,177 or 1%compared to the balance as of June 30, 2024. e3 • Operating revenues climbed $161,569 over the previous year, due principally to escalating ridership and enhanced advertising income. • Operating expenses rose$479,039 over last year's mark primarily due to a 4%surge in labor costs year over year coupled with a rising outsourcing cost associated with operating the Star Line and Metro-Flex lines via a third party provider. • Total net non-operating revenues,which consist of state and federal grants, decreased 14% by $1.5 million due to a backlog of grant approvals existing at the federal and state levels.These figures are inclusive of both operating and capital grant contributions. 5d elm PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company .— (A Component Unit of the City of Roanoke, Virginia) Management's Discussion and Analysis (unaudited) Years Ended June 30,2025 and 2024 Operating Grants(federal &state)down$1.5 million (10%): - Less grant draws and approval backlog, commensurate with the diminished receivables balance. Partially offset by gains in advertising of$39k: -Electric bus hype stimulated awareness and interest. Passenger was volume up slightly from FY24. Fiscal Year 2024 Total aggregate revenue experienced a $1.5 million contraction. To illustrate, passenger revenues were essentially flat from the prior year coupled with minimal gains in advertising, capital asset disposal gains and offsetting increases in operating grants ($3 million) vs. a $4.6 million fall in capital - related grant revenue. r Summary of Operating Expenses— Tables 4 and 5 Fiscal Year 2025 To illustrate the chart in the Financial Summary section, operating expenses have steadily climbed since 2021.This is consistent with the trajectory of both the Company's operations as well as the impact of much broader macro-economic factors. Specific to the twelve months ended June 30, 2025, the aggregate — increase over the prior year was 3%or$479k. Personnel in terms of the organizational hierarchy has been constant, however annual compensation increases proportional to what the City of Roanoke's budget allows have been the norm. In 2025,the corollary of this was an approximate$253k escalation in salaries, — wages and associated fringe benefits over the previous twelve months ended June 30, 2024. With regard to other line items and on account of inflationary pressures, increases in purchased services, insurance, and utilities are of no surprise.Also,depreciation expense rose 5%explained by the April 2025 acquisition — of the three electric buses and related equipment. Fiscal Year 2024 — Refer to Tables 4 and 5 of the preceding Financial Summary Section of this MD&A for an exhibit of comparative operating expenses. Overall, operating expenses were up 13%for the twelve months ended June 30, 2024 over the prior twelve months. This 13% increase equated to roughly $2.2 million and is multi-faceted. To break it down, compensation was up 4%year over year, consistent with the raises that were awarded that fiscal year. Personnel related fringe benefit costs were actually down from the prior year,which is the consequence of operating with a smaller staff. For example, less operators driving more bus routes and earning double-time. Furthermore, purchased services expenses (outsourcing) increased $667k(16%) as a result of the cost to on-board Metro-Flex in January 2024. This service was designed as an alternative to the regular daytime service and offers more flexibility to those with specified/differing night-time transit needs.This service is 5g .. PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company (A Component Unit of the City of Roanoke, Virginia) Management's Discussion and Analysis (unaudited) Years Ended June 30,2025 and 2024 offered by UHS(Unified Human Services). Depreciation expense also increased$908k(31%)over the prior year due to significant capital asset related activity. WNW Significant Capital Asset and Long-Term Financing Activity During the twelve months ended June 30, 2025 the Company acquired three (3) electric buses from the preferred vendor, Gillig, and placed them into service April 15, 2025 for accounting purposes. Associated with these acquisitions,per FTA protocol,were three retired bus demolitions,which were fully depreciated at the time of disposal.These procured electric buses,along with the associated batteries, chargers&bus wraps, were purchased utilizing federal grant funds totaling $2,924,602. For a detailed schedule of additions and disposals,see Note 4 to the Financial Statements. For the year ended June 30, 2025 the Company entered into a non-cancellable lease agreement with RJ Young that grants the Company control to use RJ Young's multi-function printers.The contract commenced on January 16, 2025 and is set to expire on January 16, 2030.The commencement of this lease led to the MUM Company recording a lease asset in the amount of$80,498 that is to be amortized on a straight-line basis through the maturity of the lease agreement.This also resulted in a related lease liability being recorded. Annual principal payments towards this lease totaled$7,481 during fiscal year 2025.See Notes 4 and 5 to the Financial Statements for further detail. Currently Known Facts, Decisions, or Conditions -� Now we will look at the currently known facts, decisions and conditions that are expected to have a significant effect on the Company's current financial position and are expected to produce significant differences from current period results into the future. Ridership Trends July August September October November December January February March April May June FY 2024-25 119,327 124,405 114,636 132,016 117,671 108,594 105,830 95,251 103,397 116,504 111,333 104,608 FY 2025-26 110,155 109,949 111,512 121,650 104,367 106,305 x x x x x x Static Change -9,172 -14,456 -3,124 -10,366 -13,304 -2,289 %Change -8% -12% -3% -8% -11% -2% Overall ridership is down in FY26 when compared to the prior year FY26 Outlook All ARPA funding was exhausted as of December 1,2025 and has since been supplanted by a three - year pilot grant from the Department of Rail and Public Transportation (DRPT). Delays in grant approvals at the federal level continue to have a negative effect on available cashflow. With that said, grant funding remains the primary source of revenue. To elaborate, operating expenses (labor, increase in capital maintenance due to tariffs)coupled with grant approval delays and flat passenger revenues may continue to negatively affect the Company's Net Position. In the near 5h PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company — (A Component Unit of the City of Roanoke, Virginia) Management's Discussion and Analysis (unaudited) Years Ended June 30,2025 and 2024 future,GRTC may need to revisit the local funding formula for external partners outside of the City -- of Roanoke to assist in offsetting increased financial pressure on the system. FY27 Budgeting Factors The Company's Board of Directors has adopted the Company's budget for the fiscal year 2026 and _ the City of Roanoke is in the process of considering the Company's FY27 subsidy budget proposal, which remained flat at$2,370,586 from FY26. Passenger Revenues Passenger revenues for FY27 are budgeted to increase by 7%. Currently, passenger revenues represent approximately 13% of the revenue required to operate the system. A 15% "farebox recovery rate"is the current national average for small transit systems in the U.S.GRTC can achieve this goal via increased passenger activity and/or fare increase.The most recent GRTC fare increase — occurred in 2018. Labor& Fringe Benefits Labor & Fringe Benefits for FY27 are budgeted to increase by 4%. Collective bargaining activities and increased frontline staff onboarding may affect this line item in the near future. GRTC is currently experiencing a labor shortage, particularly in the operator position. Request for Information This financial report is designed to provide interested parties with a general overview of the Company's finances. Should you have any questions about this report need additional _ information, please contact the Director of Finance, 1108 Campbell Avenue SE, P.O. Box 13247, Roanoke,VA 24013 5i PRELIMINARY DRAFT-OPEN FOR REVIEW AND DISCUSSION ONLY Basic Financial Statements PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company — (A Component Unit of the City of Roanoke, Virginia) Statements of Net Position _ June 30,2025 and 2024 2024 _ (As restated, 2025 see Note 9) ASSETS CURRENT ASSETS Cash and cash equivalents $ 1,754,268 $ - Due from: Federal Transit Administration 800,208 3,870,568 Commonwealth of Virginia 394,288 218,202 Accounts receivable 268,951 456,935 Supplies and materials (Note 3) 501,433 473,360 Other assets 2,750 - Total current assets 3,721,898 5,019,065 RESTRICTED ASSETS(Note 2): Restricted cash and cash equivalents 476,420 1,713,830 — CAPITAL ASSETS (Note 4): Non-depreciable 1,900,502 1,648,192 Depreciable, net 28,094,360 28,082,204 Capital assets, net 29,994,862 29,730,396 Total assets 34,193,180 36,463,291 LIABILITIES CURRENT LIABILITIES — Cash overdraft - 102,127 Trade accounts payable 927,822 1,601,679 Due to: Federal Transit Administration 5,400 5,400 Accrued salaries and benefits 219,019 171,109 Unearned revenue 293,464 1,455,303 Lease liability,due in one year(Note 5) 14,839 - Compensated absences, due in one year(Note 5) 146,532 169,353 Total current liabilities 1,607,076 3,504,971 LONG-TERM LIABILITIES(Note 5) Lease liability 58,178 - Compensated absences 56,984 65,859 Total long-term liabilities 115,162 65,859 Total liabilities 1,722,238 3,570,830 NET POSITION Net investment in capital assets 29,911,573 29,730,396 Unrestricted 2,559,369 3,162,065 Total net position $ 32,470,942 $ 32,892,461 The Notes to Financial Statements are an integral part of these statements. 6 ._ PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company (A Component Unit of the City of Roanoke,Virginia) Statements of Revenues, Expenses, and Changes in Net Position Years Ended June 30,2025 and 2024 2024 (As restated, 2025 see Note 9) OPERATING REVENUES Charges for passenger fares $ 1,226,083 $ 1,181,721 Advertising 187,227 148,335 Other operating revenues 155,245 76,930 Total operating revenues 1,568,555 1,406,986 OPERATING EXPENSES Salaries and wages 5,228,579 5,193,709 "' Fringe benefits 2,029,594 1,811,429 Services 930,638 1,147,944 Utilities 236,208 221,331 Insurance 283,771 252,931 Purchased services and other expenses 4,679,161 4,167,486 Materials and supplies 1,223,329 1,476,721 Rental expense - 2,500 Depreciation 3,034,039 2,892,229 Total operating expenses 17,645,319 17,166,280 Operating loss (16,076,764) (15,759,294) NONCAPITAL SUBSIDIES Federal Transit Administration 6,098,605 7,051,646 Commonwealth of Virginia 3,460,355 4,020,059 City of Roanoke,Virginia 2,193,612 2,193,612 City of Salem,Virginia 299,718 273,898 Town of Vinton,Virginia 96,588 85,419 New River Valley Metropolitan Planning Organization 81,000 81,000 Virginia Tech University 234,580 221,439 Carilion Foundation 63,000 63,000 Other local operating assistance 27,564 23,511 Total noncapital subsidies 12,555,022 14,013,584 -- Operating loss and noncapital subsidies (3,521,742) (1,745,710) OTHER NONOPERATING REVENUES Interest income 2,207 1,867 Gain on disposal of asset 26,993 70,282 Capital contributions 3,071,023 3,696,802 Total other nonoperating revenues 3,100,223 3,768,951 Increase (decrease) in net position (421,519) 2,023,241 Net position-beginning of year,as previously presented 32,830,035 30,869,220 Restatement 62,426 - Net position at beginning of year, as restated (Note 9) 32,892,461 30,869,220 Net position at end of the year $ 32,470,942 $ 32,892,461 The Notes to Financial Statements are an integral part of these statements. 7 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company — (A Component Unit of the City of Roanoke, Virginia) Statements of Cash Flows Years Ended June 30, 2025 and 2024 2024 (As restated, 2025 see Note 9) OPERATING ACTIVITIES Cash received from customers $ 1,414,067 $ 1,130,309 Cash payments to employees for services (7,241,959) (7,023,432) Cash payments to suppliers for goods and services (9,251,527) (6,583,916) Other revenue received 342,472 1,683,468 _ Net cash used in operating activities (14,736,947) (10,793,571) NONCAPITAL FINANCING ACTIVITIES Noncapital grants received 15,752,597 12,409,958 CAPITAL AND RELATED FINANCING ACTIVITIES Acquisition of capital assets (3,261,240) (5,394,101) Capital contributions 2,767,722 5,311,953 Principal paid for lease liability (7,481) - Net cash used in capital and related financing activities (500,999) (82,148) INVESTING ACTIVITIES Interest income received 2,207 1,867 Net increase in cash,cash equivalents and restricted cash 516,858 1,536,106 — CASH AND CASH EQUIVALENTS AND RESTRICTED CASH Beginning of year 1,713,830 177,724 End of year $ 2,230,688 $ $ 1,713,830 RECONCILIATION OF OERATING LOSS TO NET CASH USED IN OPERATING ACTIVITIES Operating loss $ (16,076,764) $ $ (15,759,294) Adjustments to reconcile operating loss to net cash used in operating activities: Depreciation 3,034,039 2,892,229 Changes in assets and liabilities: Decrease (increase) in accounts receivable 187,984 (51,412) Decrease (increase) in supplies and materials (28,073) 185,966 Decrease (increase) in other assets (2,750) 4,125 Increase (decrease) in cash overdraft (102,127) 102,127 Increase (decrease) in trade accounts payable (684,129) 390,280 Increase (decrease) in accrued salaries and benefits 16,214 (18,295) Increase (decrease) in unearned revenue and due to Federal Transit Administration (1,081,341) 1,460,703 Net cash used in operating activities $ (14,736,947) $ (10,793,571) RECONCILIATION TO CASH ON THE STATEMENTS OF NET POSITION Cash and cash equivalents $ 1,754,268 $ - Restricted cash and cash equivalents 476,420 1,713,830 $ 2,230,688 $ 1,713,830 SUPPLEMENTAL DISCLOSURE OF NONCASH CAPITAL AND FINANCING ACTIVITIES Capital asset purchases financed with accounts payable $ 10,272 $ - The Notes to Financial Statements are an integral part of these statements. 8 PRELIMINARY DRAFT-OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company (A Component Unit of the City of Roanoke, Virginia) Notes to Basic Financial Statements June 30, 2025 NNW Note 1—Summary of Significant Accounting Policies Organization and Purpose The Greater Roanoke Transit Company(the "Company") is a private, nonprofit, public service organization wholly owned by the City of Roanoke,Virginia (the"City").The Company provides a comprehensive range of transportation services for the residents of the greater Roanoke area, including bus service along fixed routes, special services for the disabled, and - shuttle buses. Similar to other public transportation systems,government subsidies are required to fund operations. The Company is the recipient of operating and capital grants from federal, state, and local agencies, including the Federal Transit Administration (the "FTA"),the Virginia Department of Rail and Public Transportation (the "DRPT"),and the City. Company policy decisions are made by the Board of Directors, which is comprised of two (2) City Council members, two (2) City employees, and three (3) citizens of the community at large. The Company contracts with First Group America Company(dba First Transit, Inc.)to provide senior management professionals.The remainder of the staff are employees IMP of Southwestern Virginia Transit Management Company, Inc. ("SVTMC"), a subsidiary of First Transit, Inc. Bargaining unit employees of SVTMC, which include all bus drivers and mechanics, are under a separate contract ratified by the Amalgamated Transit Union,AFL CIO CLC,Local Union 1493 ("Union")effective July 1,2022,and expired on June 30,2025. An extension agreement is in place that maintains the current contract provisions through October 31, 2025, and extends every thirty days thereafter until a new agreement is in place. As of [DATE OF AUDIT REPORT], there has been no new agreement reached. The Company is reported as a discretely presented component unit with the City's reporting entity. Basis of Accounting The accompanying financial statements reflect the transit operations of the Company and are accounted for on the economic resources measurement focus and use the accrual basis of accounting,which is in accordance with accounting principles generally accepted in the United States of America ("GAAP"), as promulgated by the Governmental Accounting Standards Board, and conform with the requirements of the FTA's National Transit Database, as amended. Accordingly, revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash flows take place. Nonexchange transactions, in which the Company receives value without directly giving equal value in exchange, include appropriations from the City, grants, and donations. Revenues from grants and contributions are recognized in the fiscal year in which all eligibility requirements, including time requirements, if any are met. Cash and Cash Equivalents The Company's cash and cash equivalents consist of cash on hand, demand deposits, and short-term investments with original maturities three months of less from date of acquisition. Supplies and Materials Supplies and materials consist of various consumable items which are maintained on a perpetual basis with periodic verification based on physical count. Supplies and materials are valued using a weighted average cost approach. 9 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company - (A Component Unit of the City of Roanoke, Virginia) Notes to Basic Financial Statements — June 30, 2025 Capital Assets MM. Capital assets are stated at cost less accumulated depreciation computed by the straight line method over the estimated — lives of the respective assets as follows: Buildings,structure, and improvements 2—40 years Buses 2—12 years — Shop and garage equipment 2—10 years Office furniture and equipment 2—10 years — Contributed and donated capital assets are recorded at acquisition value at the date of receipt. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets' lives are not capitalized. Lease assets are amortized over the shorter of the lease term or useful life of the underlying asset. Accounts Receivable Accounts receivable is recorded at the invoiced amount and do not bear interest. The Company does not record an allowance for existing accounts receivable based on historical experience.Account balances are charged off after all means of collection have been exhausted and the potential for recovery is considered remote. — Compensated Absences Administrative employees are granted vacation leave in varying amounts,and Union employees are granted paid days off (PDO) in varying amounts. In the event of termination, an employee is paid for accumulated vacation or PDO in full. Accumulated vacation and PDO are recorded as an expense and liability as the benefits accrue to employees. Sick leave is — recorded as an expense as the employee utilizes it. The Company implemented GASB Statement 101: Compensated Absences which require liabilities for compensated absences be recognized for 1) leave that has not been used and 2) leave that has not been used but not yet paid in cash — or settled through noncash means. A liability is recognized for leave that has not been used if 1) the leave is attributable to services already rendered, 2)the leave accumulates, and 3)the leave is more likely than not to be used for time off or otherwise paid in cash or settled through noncash means.As stated in GASB Statement No. 100,Accounting Changes and — Error Corrections, a change in accounting principle should be reported retroactively by restating beginning net position for the cumulative effect of the change of the newly adopted accounting principle on prior periods. See Note 9 for the restatement performed for the implementation of GASB Statement 101. Operating Revenues and Expenses Operating revenues consist of charges for passenger fares and are recorded as revenue at the time of sale. Rental, and advertising income are recorded on the accrual basis of accounting based upon the date in which services are provided to customers. Operating expenses include costs of services provided, including personnel costs, purchased services, utilities, — materials and supplies, insurance and depreciation. All other revenues and expenses, with the exception of capital contributions,are classified as nonoperating revenues and expenses. 10 — - PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company (A Component Unit of the City of Roanoke, Virginia) — Notes to Basic Financial Statements June 30, 2025 Unearned Revenues owe Unearned revenues represent amounts for which asset recognition criteria have been met, but for which revenue recognition criteria have not been met.Grants and contributions received before the eligibility requirements are met have been recorded as unearned revenues. Deferred Compensation Plan '.— Company employees participate in the Southwestern Virginia Transit Management Company, Inc. Retirement Plan (the "Plan"),which is a deferred compensation plan and trust covering all eligible employees of the Company. Under the terms of the Plan agreement, all full time employees are required to participate in the Plan upon completion of their probationary employment period, which is 90 days from date of hire for all employees. Southwest Virginia Transit Management Company, Inc. is the Trustee of the Plan,which is administered by the Reliance Trust Company. Participants contribute to the Plan through both mandatory and voluntary payroll deductions. Participants are required to contribute WI a minimum of 3%of annual compensation. Participants may elect to defer up to 100% of their pretax compensation not to exceed the Internal Revenue Service ("IRS") limitations on net contributions.The Company can make contributions at its discretion. The Plan qualifies as a government plan under Section 457 of the Internal Revenue Code.This qualification exempts the Plan from the Employee Retirement Income Security Act and the Department of Labor regulations. Charges to operations under the Plan are based on 3%of union and salary participants'eligible payroll. Net Position Net position represents the difference between assets and liabilities. Net position may be comprised of three components: Net Investment in Capital Assets — Consists of the historical cost of capital assets net of any accumulated depreciation and any liabilities incurred to finance capital assets.This includes lease liabilities. —' Restricted—Consists of assets where limitations are imposed through external restrictions imposed by creditors, grantors, or the laws and regulations of other governments. Unrestricted—All other net position is reported as net invested in this category. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities,and net position at the date of the financial statements and the reported amounts of revenues, expenses, and changes in net position during the reporting period. Actual results could differ from these estimates. Change in Accounting Principle — During 2025, the Company adopted GASB Statement No. 101, Compensated Absences. This standard established new guidance for the recognition and measurement of compensated absences. A liability should be recognized for leave that has not been used if the leave is attributable to services already rendered,the leave accumulates, and the leave is more likely than to be used for time off or otherwise paid in cash or settled through noncash means.As stated in GASB Statement No. 100,Accounting Changes and Error Corrections, a change in accounting principle should be reported retroactively by — restating net position for the cumulative effect of the change of the newly adopted accounting principle on prior periods. 11 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company -- (A Component Unit of the City of Roanoke, Virginia) Notes to Basic Financial Statements — June 30,2025 The Company determined the cumulative effect was significant enough for a restatement of beginning net position documented in Note 9. The Company also adopted GASB Statement No. 103, Financial Reporting Model Improvements and GASB Statement No. 104, Disclosure of Certain Capital Assets. Statement No. 103 established new guidance on the presentation of management's discussion and analysis (MD&A); unusual or infrequent items;the proprietary fund statement of revenues, expenses, and changes in fund net position; defines operating revenues and expenses, nonoperating revenues and — expense, and subsidies.The comparative financial statements and related footnotes have been reclassified to reflect the presentation requirements within the standard.The adoption of this standard had no impact on beginning net position. Statement No. 104 established new guidance on the presentation of leases, public-private and public-public partnerships and availability payment arrangements, and other intangible right-to-use assets within the footnotes of the financial statements. These three capital asset categories must be disclosed separately by major class of underlying asset in the _ capital asset note disclosures. Subscription-based information technology arrangements must also separately be disclosed. The standard also establishes reporting requirements for capital assets held for sale. Capital assets are capital assets held for sale if 1)the government has decided to pursue the sale of the capital asset, and 2) it is probable that the sale will be finalized within one year of the financial statement date. For capital assets that meet these criteria, the following must be disclosed:the ending balance of capital assets held for sale,with separate disclosure for historical cost and accumulated depreciation by major class of asset; and the carrying amount of debt for which the capital assets held for sale are pledged as collateral for each major class of asset. See Note 4 for effect on classification. — Note 2 — Cash and Cash Equivalents All cash and cash equivalents are held by financial institutions in the name of the Company.At June 30,2025 and 2024, all cash and cash equivalents were fully collateralized pursuant to agreements with all participating financial institutions to _ pledge assets on a pooled basis to secure public deposits according to the Virginia Security for Public Deposits Act Regulations of the Code of Virginia. Restricted cash is composed of Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) received from the City of Roanoke to fund the Company's Metroflex project of offering Micro Transit services to individuals in the Roanoke Valley. Restricted cash and cash equivalents totaled$476,420 and $1,713,830 at June 30,2025 and 2024, respectively. According to the Memorandum of Understanding governing the Metroflex project, any unspent CSLFRF funds in this account at — December 1, 2025, are due back to the City. Note 3—Supplies and Materials — As of June 30, 2025 and 2024, supplies and materials consisted of the following: 2025 2024 Parts $ 467,544 $ 415,382 Diesel fuel 24,841 37,800 — Lubricating oil 9,048 20,178 $ 501,433 $ 473,360 12 — PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company (A Component Unit of the City of Roanoke, Virginia) Notes to Basic Financial Statements June 30, 2025 Note 4—Capital Assets Capital asset activity for the year ended June 30, 2025 and 2024,are as follows: Balance at Transfers and Balance at June 30,2024 Additions Disposals June 30,2025 Capital assets not being depreciated: Land $ 1,627,487 $ - $ - $ 1,627,487 Construction in progress 20,705 3,142,447 (2,890,137) 273,015 Total capital assets not being depreciated 1,648,192 3,142,477 (2,890,137) 1,900,502 Capital assets being depreciated: _ Building,structures,and improvements 22,151,963 - - 22,151,963 Buses 24,377,256 2,964,589 (951,646) 26,390,199 Shop and garage equipment 3,437,108 40,169 (3,458) 3,473,819 Office equipment and furnishings 687,117 16,101 (935) 702,283 Lease assets: Equipment - 80,498 - 80,498 Total capital assets being depreciated 50,653,444 3,101,357 (956,039) 52,798,762 Accumulated depreciation: Building,structures,and improvements (6,595,506) (734,763) - (7,330,269) Buses (12,197,981) (2,036,565) 900,877 (13,333,669) Shop and garage equipment (3,146,904) (220,734) - (3,367,638) Office equipment and furnishings (630,849) (34,496) - (665,345) Lease assets: Equipment - (7,481) - (7,481) . Total accumulated depreciation (22,571,240) (3,034,039) 900,877 (24,704,402) Total capital assets being depreciated 28,082,204 67,318 (55,162) 28,094,360 Total capital assets, net $ 29,730,396 $ 3,209,765 $ (2,945,299) $ 29,994,862 13 PRELIMINARY DRAFT-OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company (A Component Unit of the City of Roanoke, Virginia) Notes to Basic Financial Statements — June 30, 2025 Balance at Transfers and Balance at June 30,2023 Additions Disposals June 30,2024 Capital assets not being depreciated: —• Land $ 1,627,487 $ - $ $ 1,627,487 Construction in progress 1,048,580 1,409,055 (2,436,930) 20,705 Total capital assets not being depreciated 2,676,067 1,409,055 (2,436,930) 1,648,192 — Capital assets being depreciated: Building,structures,and improvements 21,408,851 859,580 (116,468) 22,151,963 Buses 25,876,838 2,421,061 (3,920,643) 24,377,256 Shop and garage equipment 3,426,938 544,235 (534,065) 3,437,108 Office equipment and furnishings 688,641 - (1,524) 687,117 Lease assets: Equipment - Total capital assets being depreciated 51,401,268 3,824,876 (4,572,700) 50,653,444 Accumulated depreciation: Building,structures,and improvements (5,968,985) (742,989) 116,468 (6,595,506) Buses (14,229,025) (1,912,090) 3,943,134 (12,197,981) Shop and garage equipment (3,482,205) (198,764) 534,065 (3,146,904) Office equipment and furnishings (556,338) (38,386) (36,125) (630,849) Lease assets: - - Equipment - Total accumulated depreciation (24,236,553) (2,892,229) 4,557,542 (22,571,240) Total capital assets being depreciated 27,164,715 932,647 (15,158) 28,082,204 Total capital assets, net $ 29,840,782 $ 2,341,702 $ (2,452,088) $ 29,730,396 Included in capital assets are three buses that are capital assets held for sale.These three buses have a total historical cost of$1.47 million and an accumulated depreciation of$1.47 million. Note 5— Long-Term Liabilities Lease Arrangement The Company entered into a non-cancellable lease agreement that conveys control of the right to use another party's asset, along or in combination with tangible capital assets, as specified in the contract in an exchange or exchange-like transaction.At the commencement of the lease,the Company initially measured the lease liability at the present value of payments expected to be made during the lease term. Subsequently,the lease liability is reduced by the principal portion of lease payments made. The Company used the rate implicit in the lease contract as the discount rate for valuing the lease liability in 2025,which was 5.00%.The significant lease contract is as follows: _. Lease Contract Contract Date Maturity Date* RJ Young Company—Multi-function printers 1/16/2025 1/26/2030 — * Maturity date includes option years, if likely to be exercised. The following is a summary of the noncurrent liability activity for the Company for the years ended June 30, 2025 and 2024: 14 — -'- PRELIMINARY DRAFT-OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company ,_ (A Component Unit of the City of Roanoke, Virginia) Notes to Basic Financial Statements June 30, 2025 June 30,2024, Due Within _ as restated Increases Decreases June 30,2025 One Year Lease liability $ - $ 80,498 $ (7,481) $ 73,017 $ 14,839 Compensated absences 235,212 (31,696) * 203,516 146,532 Total noncurrent liabilities $ 235,212 $ 80,498 $ (39,177) $ 276,533 $ 161,371 * The change in the compensated absences liability is presented as a net change. June 30,2024, Due Within June 30,2023 Increases Decreases as restated One Year Lease liability $ - $ - $ - $ - $ _ Compensated absences 266,791 - (31,579) * 235,212 169,353 Total noncurrent liabilities $ 266,791 $ - $ (31,579) $ 235,212 $ 169,353 * The change in the compensated absences liability is presented as a net change. Annual requirements to amortize lease liabilities are as follows: Year Ending Lease Liability June 30, Principal Interest 2026 $ 14,839 $ 3,314 -- 2027 15,599 2,555 2028 16,397 1,757 2029 17,236 918 2030 8,946 131 $ 73,017 $ 8,675 Note 6- Deferred Compensation Plan The Company has a deferred compensation plan (see Note 1) covering all hourly and salaried employees.The Company's contributions to the deferred compensation plan were$156,863 and $143,286 in 2025 and 2024, respectively. - Note 7- Contractual Commitments Under the provisions of a management contract with First Group America Company (dba First Transit, Inc.), which --- originally became effective on March 1, 2010,and was renewed July 1, 2020,the Company paid a monthly fee of$31,324 and $33,044 for management services for years ended June 30, 2025 and 2024, respectively.Total fees paid for the years ended June 30, 2025 and 2024,were$375,888 and$396,524, respectively. Certain assets acquired with FTA grants must be kept in service for a specified time period as a requirement of the grants. If these assets are removed from service, the Company must reimburse FTA for up to 80% of their fair market value on .., the date of disposition. Capital assets, net, approximated $30.0 million and $29.7 million for the years ended June 30, 2025 and 2024, respectively, and are subject to these grant requirements. 15 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company - (A Component Unit of the City of Roanoke, Virginia) Notes to Basic Financial Statements - June 30,2025 The Company has agreements with the City of Salem,Virginia and Town of Vinton,Virginia to provide bus service to each locality,which may be terminated by either party upon written notice of twelve months and six months, respectively.The localities reimburse the Company for 51%of the net operating costs based upon passenger counts and service miles. Note 8— Risk Management The Company is exposed to various risks of loss such as theft of, damage to, and destruction of assets, injuries to employees, and natural disasters. The Company carries commercial insurance for their risks. There have been no significant reductions in insurance coverage from coverage in the prior year and settled claims have not exceeded the — amount of insurance coverage in any of the past three fiscal years. The Company is involved in various legal proceedings from time to time in the normal course of business.In management's opinion,the Company is not currently involved in any legal proceedings which individually or in the aggregate could have — a material effect on the financial condition, results of operations, and/or liquidity of the Company. Note 9— Prior Period Restatement of Net Position — The Company restated net position for the adoption of GASB Statement 101: Compensated Absences. The adoption of GASB 101 led to an increase in beginning net position.The impact of implementing this accounting change is summarized below: Net position balance July 1, 2024, as previously reported $ 32,830,035 — Decrease of opening compensated absences balance and related fringe benefits expense 62,426 Net change 62,426 — Net position balance July 1, 2024, as restated $ 32,892,461 See below for a reconciliation of the previously issued June 30,2024,statements of net position and statement of revenues — expenses and changes in net position to the restated June 30,2024,statement of net position and statements of Revenues, expenses and changes in net position, and statements of cash flow. 16 — PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company (A Component Unit of the City of Roanoke, Virginia) Notes to Basic Financial Statements June 30,2025 Reconciliation of the Statement of Net Position — Balance at Balance at June 30,2024, July 1,2024 Restatement as restated _ ASSETS Current assets: Cash and cash equivalents $ - $ - $ - Due from: Federal Transit Administration 3,870,568 - 3,870,568 Due from Federal Government - - - Commonwealth of Virgina 218,202 - 218,202 '� City of Roanoke - - - Accounts receivable 456,935 - 456,935 Supplies and materials 473,360 - 473,360 Other assets - - - Total current assets 5,019,065 - 5,019,065 Restricted assets: -- Restricted cash and cash equivalents 1,713,830 - 1,713,830 Capital assets: Land 1,627,487 - 1,627,487 Buildings, structures and improvements 22,151,963 - 22,151,963 Buses 24,377,256 - 24,377,256 Shop and garage equipment 3,437,108 - 3,437,108 Office equipment and furnishings 687,117 - 687,117 Construction in progress 20,705 - 20,705 Accumulated depreciation (22,571,240) - (22,571,240) Total capital assets, net 29,730,396 - 29,730,396 Total assets 36,463,291 - 36,463,291 17 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company — (A Component Unit of the City of Roanoke, Virginia) Notes to Basic Financial Statements — June 30,2025 Reconciliation of the Statement of Revenues, Expenses,and Changes in Net Position — Balance at Balance at June 30,2024, July 1,2024 Restatement as restated — LIABILITIES Current liabilities: Cash overdraft $ 102,127 $ - $ 102,127 Trade accounts payable 1,601,679 - 1,601,679 Due to: Federal Transit Administration 5,400 - 5,400 — Accrued salaries and benefits 171,109 - 171,109 Unearned revenue 1,455,303 - 1,455,303 Compensated absences, due in one year 214,299 (44,946) 169,353 Total current liabilities 3,549,917 (44,946) 3,504,971 Long-term liabilities Compensated absences 83,339 (17,480) 65,859 Total long-term liabilities 83,339 (17,480) 65,859 Long-term liabilities: Due within one year 214,299 (44,947) 169,353 Due in more than one year: Compensated absences 83,339 (17,479) 65,859 Total long-term liabilities 297,638 (62,426) 235,212 _ Total liabilities 3,633,256 (62,426) 3,570,830 NET POSITION Net investment in capital assets $ 29,730,396 $ - $ 29,730,396 _ Unrestricted 3,099,639 62,426 3,162,065 Total net position $ 32,830,035 $ 62,426 $ 32,892,461 18 -- PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company (A Component Unit of the City of Roanoke, Virginia) — Notes to Basic Financial Statements June 30, 2025 Reconciliation of the Statement of Revenues, Expenses,and Changes in Net Position — Balance at Balance at June 30,2024, July 1,2024 Restatement as restated OPERATING REVENUES — Charges for passenger fares $ 1,181,721 $ - $ 1,181,721 Advertising 148,335* - 148,335 Other operating income 76,930* - 76,930 — Total operating revenues 1,406,986 - 1,406,986 OPERATING EXPENSES Salaries and wages 5,193,709 - 5,193,709 �' Fringe benefits 1,873,855 (62,426) 1,811,429 Services 1,147,944 - 1,147,944 Utilities 221,331 - 221,331 '.. Insurance 252,931 - 252,931 Purchased services and other expenses 4,167,486 - 4,167,486 Materials and supplies 1,476,721 - 1,476,721 — Rental expense 2,500* - 2,500 Depreciation 2,892,229 - 2,892,229 Total operating expenses 17,228,706 (62,426) 17,166,280 — Operating loss (15,821,720) 62,426 (15,759,294) NONCAPITAL SUBSIDIES Federal Transit Administration 7,051,646 - 7,051,646 Commonwealth of Virginia 4,020,059 - 4,020,059 City of Roanoke,Virginia 2,193,612 - 2,193,612 City of Salem,Virginia 273,898 - 273,898 Town of Vinton,Virginia 85,419 - 85,419 New River Valey Metropolitan Planning Organization 81,000 - 81,000 Virginia Tech University 221,439 - 221,439 _ Carilion Foundation 63,000 - 63,000 Other local operating assistance 23,511 - 23,511 Total noncapital subsidies 14,013,584 - 14,013,584 Operating loss and noncapital subsidies (1,808,136) 62,426 (1,745,710) OTHER NONOPERATING REVENUES Interest income 1,867 - 1,867 Gain on disposal of asset 70,282 - 70,282 — Capital contributions 3,696,802 - 3,696,802 Total other nonoperating revenues 3,768,951 - 3,768,951 Increase in net position 1,960,815 62,426 2,023,241 — NET POSITION Beginning of year 30,869,220 - 30,869,220 End of year $ 32,830,035 $ 62,426 $ 32,892,461 — *These items were previously included in local share and other revenues, but implementation of GASB 103, Financial Reporting Model Improvements, caused these items to be broken out as operating items. See related note on the following reconciliation of the statement of cash flows. 19 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company — (A Component Unit of the City of Roanoke, Virginia) Notes to Basic Financial Statements — June 30, 2025 Reconciliation of the Statement of Cash Flows — Balance at Balance at June 30,2024, July 1,2024 Restatement as restated OPERATING ACTIVITIES Cash received from customers $ 1,130,309 $ - $ 1,130,309 Cash payments to employees for services (7,023,432) - (7,023,432) Cash payments to suppliers for goods and services (6,583,916) - (6,583,916) Other revenue received 1,683,468 - 1,683,468 Net cash used in operating activities (10,793,571) - (10,793,571) — NONCAPITAL FINANCING ACTIVITIES Noncapital grants received 12,409,958 - 12,409,958 CAPITAL AND RELATED FINANCING ACTIVITIES — Acquisition of capital assets (5,394,101) - (5,394,101) Capital contributions 5,311,953 - 5,311,953 Net cash used in capital and related financing _ activities (82,148) - (82,148) INVESTING ACTIVITIES Interest income received 1,867 - 1,867 — Net increase in cash,cash equivalents 1,536,106 - 1,536,106 CASH AND CASH EQUIVALENTS Beginning of year 177,724 - 177,724 — End of year $ 1,713,830 $ - $ 1,713,830 RECONCILIATION OF OPERATING LOSS TO NET CASH USED IN OPERATING ACTIVITIES _ Operating loss $ (16,044,485) $ 285,191* $ (15,759,294) Adjustments to reconcile operating loss to net cash used in operating activities: Local share and other net revenue (excluding interest) 222,765 (222,765)* - Depreciation 2,892,229 - 2,892,229 Changes in assets and liabilities: _ Increase in accounts receivable (51,412) - (51,412) Decrease in supplies and materials 185,966 - 185,966 Decrease in other assets 4,125 - 4,125 Increase in cash overdraft 102,127 - 102,127 Increase in trade accounts payable 390,280 - 390,280 Increase (decrease) in accrued salaries and benefits 44,131 (62,426) (18,295) Increase in unearned revenue 1,460,703 - 1,460,703 Net cash used in operating activities $ (10,793,571) $ - $ (10,793,571) *The change in operating loss and local share and other net revenue (excluding interest)was caused by the implementation of GASB 103, Financial Reporting Model Improvements. Certain items previously included in local share are now included as operating items.These items are advertising revenue, other operating revenues, and rental expense which totaled $222,765. 20 PRELIMINARY DRAFT-OPEN FOR REVIEW AND DISCUSSION ONLY Compliance Section PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company — (A Component Unit of the City of Roanoke,Virginia) Schedule of Expenditures of Federal Awards Year Ended June 30,2025 — Assistance Federal Grantor/Pass-Through Grantor/ Listing Program Title or Cluster Title Number Identifying Number Expenditures DEPARTMENT OF TRANSPORTATION Federal Transit Cluster FY22 FTA Capital Assistance 20.507 VA-2022-04-00-027 $ 1,178 FY23 FTA Capital Assistance 20.507 VA-2023-002-01-00 1,987,462 FY24 FTA Operating Assistance 20.507 VA-2024-010-01-00 1,298,226 FY25 FTA Operating Assistance 20.507 VA-2025-017-01-00 2,669,517 _ FY25 FTA Capital Assistance 20.507 VA-2025-017-01-00 185,959 Total Federal Transit Cluster 6,142,342 Formula Grants for Rural Areas Virginia Department of Rail and Public Transportation '— FY24 Operating Assistance 20.509 42524-12 5311 DRPT 398,325 FY25 Operating Assistance 20.509 42525-09-FY25 FTA 5311 570,698 Formula Grants for Rural Areas 969,023 Total Department of Transportation 7,111,365 DEPARTMENT OF TREASURY City of Roanoke,Virginia COVID-19-Coronavirus State and Local Fiscal Recovery Funds 21.027 CSLFRF 1,161,839 Total Department of Treasury 1,161,839 Grand Total Federal Financial Assistance $8,273,204 See accompanying notes to schedule of expenditures of federal awards. 21 _ PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company (A Component Unit of the City of Roanoke, Virginia) Notes to Schedule of Expenditures of Federal Awards June 30, 2025 Note A— Basis of Presentation The accompanying Schedule of Expenditures of Federal Awards(the"Schedule") includes the federal award activity of the Greater Roanoke Transit Company (the "Company") under programs of the federal government for the year ended June 30, 2025. The information in the Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal ...., Awards (the "Uniform Guidance"). Because the schedule presents only a selected portion of the operations of the Company, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Company. Note B—Summary of Significant Accounting Policies Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Subpart E of the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Note C— Indirect Cost Rate The Company has not elected to use the 10%de minimis indirect cost rate allowed under the Uniform Guidance. Note D— Outstanding Loan Balances At June 30, 2025,the Company had no outstanding loan balances requiring continuing disclosure. 22 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY BROWNEDWARDS crrtifird jwhiic uccowritourtti Independent Auditor's Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards Board of Directors Greater Roanoke Transit Company Roanoke,Virginia We have audited, in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States,the financial statements of the Greater Roanoke _ Transit Company (the "Company") as of and for the year ended June 30, 2025, and the related notes to the financial statements,which collectively comprise the Company's basic financial statements, and have issued our report thereon dated ,2026. Internal Control over Financial Reporting In planning and performing our audit of the financial statements, we considered the Company's internal control over financial reporting (internal control) as a basis for designing the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. Accordingly,we do not express an opinion on the effectiveness of the Company's internal control. Our consideration of internal control was for the limited purpose described in the preceding paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that have not been identified. However, as described in the accompanying schedule of findings and _ questioned costs, we identified certain deficiencies in internal control that we consider to be material weaknesses and significant deficiencies. A deficiency in internal control exists when the design or operation of a control does not allow '— management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis.A material weakness is a deficiency,or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented or detected and corrected on a timely basis.We identified the deficiency in internal control, described in the accompanying schedule of findings and questioned costs as Item 2025-001 that we consider to be a material weakness. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with _ governance. We identified certain deficiencies in internal control, described in the accompanying www.becpas.com PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY schedule of findings and questioned costs as Items 2025-002 and 2025-003 that we consider to be significant deficiencies. Report on Compliance and Other Matters As part of obtaining reasonable assurance about whether the Company's financial statements are free of material misstatement,we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed one instance of noncompliance that is required to be reported under Government Auditing Standards and is described in the accompanying schedule of findings and questioned costs as Item 2025-007. Company's Response to Findings Government Auditing Standards requires the auditor to perform limited procedures on the Company's response to the findings identified in our audit and described in the accompanying schedule of findings and questioned costs. The Company's response was not subjected to the other auditing procedures applied in the audit of the financial statements and, accordingly,we express no opinion on the response. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the Company's internal control or on compliance.This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the Company's internal control and compliance. Accordingly,this communication is not suitable for any other purpose. CERTIFIED PUBLIC ACCOUNTANTS Roanoke,Virginia IMP , 2026 24 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY BROWNEDWARDS to Ord public nccuuutuuts Independent Auditor's Report on Compliance for Each Major Program and on Internal Control over Compliance Required by the Uniform Guidance Board of Directors Greater Roanoke Transit Company _ Roanoke,Virginia Report on Compliance for Each Major Federal Program — Opinion on Compliance for Each Major Federal Program We have audited the Greater Roanoke Transit Company's (the "Company")compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of the Company's major federal programs for the year ended June 30, 2025.The Company's major federal programs are identified in the summary of auditor's results section of the accompanying schedule of findings and questioned costs. In our opinion,the Company complied,in all material respects,with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2025. Basis for Opinion on Each Major Program We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and — Audit Requirements for Federal Awards (Uniform Guidance). Our responsibilities under those standards and the Uniform Guidance are further described in the Auditor's Responsibilities for the Audit of Compliance section of our report. We are required to be independent of the Company and to meet our other ethical responsibilities, in accordance with relevant ethical requirements related to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on compliance for each major federal program. Our audit does not provide a legal documentation of the Company's compliance with the compliance requirements referred to above. Responsibilities of Management for Compliance Management is responsible for compliance with the requirements referred to above and for the design, — implementation,and maintenance of effective internal control over compliance with the requirements of www.becpas.com PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY laws, statutes, regulations, rules, and provisions of contracts or grant agreements applicable to the Company's federal programs. - Auditor's Responsibilities for the Audit of Compliance Our objectives are to obtain reasonable assurance about whether material noncompliance with the compliance requirements referred to above occurred, whether due to fraud or error, and express an opinion on the Company's compliance based on our audit. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards,Government Auditing Standards, and the Uniform Guidance will always detect material noncompliance when it exists. The risk of not detecting material noncompliance resulting from fraud is higher than for that resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Noncompliance with the compliance requirements referred to above is considered material if there is a substantial likelihood that, individually or in the aggregate, it would influence the judgement made by a reasonable user of the report on compliance about the Company's compliance the requirements of each major federal program as a whole. In performing an audit in accordance with generally accepted auditing standards, Government Auditing Standards,and the Uniform Guidance,we: • Exercise professional judgment and maintain professional skepticism throughout the audit. • Identify and assess the risk of material noncompliance,whether due to fraud or error,and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the Company's compliance with the compliance requirements referred to above and performing such other procedures as we considered necessary in the circumstances. • Obtain an understanding of the Company's internal control over compliance relevant to the audit in order to design audit procedures that are appropriate in the circumstances and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over compliance Accordingly, no such opinion is expressed. We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and any significant deficiencies and material weaknesses in internal control over compliance that we identified during the audit. Report on Internal Control over Compliance Our consideration of internal control over compliance was for the limited purpose described in the Auditor's Responsibilities for the Audit of Compliance section above and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies in internal control over compliance and therefore, material weaknesses or significant deficiencies may exist that were not identified. Given these limitations, during our audit we did not identify any deficiencies in internal control over compliance that we consider material weaknesses. 26 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY However,as discussed below,we did identify certain deficiencies in internal control over compliance that we consider to be significant deficiencies. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned _ functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency,or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance. We consider the deficiencies in internal control over compliance described in the accompanying schedule of findings and questioned costs as Item 2025-004,2025-005,and 2025-006 to be significant deficiencies. Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal _ control over compliance. Accordingly, no such opinion is expressed. Government Auditing Standards requires the auditor to perform limited procedures on the Company's response to the internal control over compliance findings identified in our audit is described in the accompanying schedule of findings and questioned costs.The Company's response was not subjected to the other auditing procedures applied in the audit of compliance and, accordingly,we express no opinion the response. The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly,this report is not suitable for any other purpose. CERTIFIED PUBLIC ACCOUNTANTS Roanoke,Virginia 2026 27 _ PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company (A Component Unit of the City of Roanoke, Virginia) Summary of Compliance Matters June 30, 2025 As more fully described in the Independent Auditor's Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards, we performed tests of the Company's compliance with certain provisions of the laws, regulations, contracts, and grants shown below. Local Compliance Matters Company By-Laws Commonwealth of Virginia Compliance Matters Virginia Public Procurement Act—Prompt Payment Requirement Federal Compliance Matters Compliance Supplement for Single Audits of State and Local Governments Provisions and conditions of agreements related to federal programs selected for testing. 28 PRELIMINARY DRAFT-OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company (A Component Unit of the City of Roanoke, Virginia) Schedule of Findings and Questioned Costs _ June 30, 2025 A—Summary of Auditor's Results 1. The auditor's report expresses an unmodified opinion on the financial statements. 2. Two significant deficiencies and one material weakness relating to the audit of the financial statements were ` reported in the Independent Auditor's Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards. 3. One instance of noncompliance material to the financial statements was disclosed. 4. Three significant deficiencies and no material weaknesses relating to the audits of the major federal award programs were reported in the Independent Auditor's Report on Compliance for Each Major Program and on Internal Control over Compliance Required by the Uniform Guidance. 5. The auditor's report on compliance for the major federal award program expresses an unmodified opinion. 6. The audit disclosed three findings relating to the major programs. 7. The programs tested as major were: Assistance Name of Program Listing Number Federal Transit Administration Grant Cluster: Federal Transit Formula Grants—Operating and Capital Assistance 20.507 Formula Grants for Rural Areas 20.509 COVID-19—Coronavirus State and Local Fiscal Recovery Funds 21.027 8. The threshold for distinguishing Type A and B programs was$750,000. 9. The Company was not determined to be a low-risk auditee. B— Findings— Financial Statement Audit 2025-001:Segregation of Duties and Management Oversight—Inventory(Material Weakness) Condition Duties handled by the Inventory Manager included incompatible duties during the year under audit such as having access to both physical inventory and to the inventory tracking system. Criteria Internal controls related to inventory should be designed to ensure that one individual does not have control of both the inventory records and the physical assets. Cause Internal control structure does not have a separation of duties between physical inventory custody and the inventory tracking system. Effect Internal controls are designed to safeguard assets and detect losses from employees dishonesty or error. Recommendation Steps should be taken to eliminate conflicting duties and implement compensating controls, where possible. View of Responsible In our opinion the inventory function, as it stands, has satisfactory safeguards in place to Officials prevent misappropriation of assets, fraudulent financial reporting and/or material misstatements due to error. However, after collaborating with the inventory team a compensating control has been implemented which strips the two inventory clerks ability to adjust inventory quantities in the inventory sub-ledger (RTA). Further, the director himself will perform all system adjustments at the behest of the two inventory clerks. Given a staff of four(4)there will still exist individual simultaneous access to both physical inventory and 29 — PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company (A Component Unit of the City of Roanoke, Virginia) Schedule of Findings and Questioned Costs June 30,2025 system adjustment's by the director however such access is warranted in the case of having a backup for staff turnover and/or extended absences. 2025-002: Grant Management and Operating Assistance (Significant Deficiency) Condition During 2025, we noted that grant reimbursements were not submitted within 90 days on 15 of 25 Transit Cluster disbursements tested. Of those 15 instances, three disbursements did not have a reimbursement requested for over 90 days and were requested after the end of fiscal year 2025.We also noted two instances where vendors were not paid for over 30 days. Criteria Internal controls related to financial management should be designed to ensure timely submission of reimbursement requests and payment of vendors. Cause Elevated levels of federal and state grant usage caused delays in performance of and reduction in effectiveness of certain financial duties. VIP Effect Untimely drawdowns could result in vendors not being paid timely and result in cash shortages. Recommendation We recommend that the Company establish financial management procedures to ensure the timely submission of reimbursement requests and payment of vendors. View of Responsible GRTC acknowledges this finding and will continue to address this issue via updated grant Officials management processes and training additional finance staff on grant writing, pre-award and post-award activities. 2025-003: Bank Reconciliations (Significant Deficiency) Condition Monthly bank reconciliations were not prepared by an accountant and reviewed and approved by a supervisor in a timely manner. Criteria Monthly bank reconciliations should be performed by the 15th of the next month. Cause Staff turnover during the year. Effect Can lead to poor cash flow management resulting in vendor and contractor invoices not being paid timely. Recommendation We recommend bank reconciliations be prepared by an accountant and reviewed by a supervisor to ensure unreconciled or unusual items, or other matters noted in the reconciliation, are detected and addressed in a timely manner. View of Responsible The Director of Finance performs monthly bank reconciliations in FY26 in a timely manner. Officials Specifically, the dates for completion and sign off on the operating bank reconciliation for the first five months of FY26 are as follows: July: 9/22/2025; August: 10/06/2025; September: 11/06/2025; October: 11/19/2025; November: 12/15/2025; December — In process. Kevin Price, General Manager, needs to perform the review of such bank reconciliations in a timely manner and document such review and approval with his endorsement on the face of the reconciliation by the end of the following month no later than 30 days after the bank statement date. 30 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company — (A Component Unit of the City of Roanoke, Virginia) Schedule of Findings and Questioned Costs — June 30, 2025 C— Findings and Questioned Costs— Major Federal Award Program Audit 2025-004: Federal Transit Cluster — AL# 20.507, Cash Management — Significant Deficiency, Controls over Compliance Condition We noted two instances out of 25 where contractors and vendors were not paid for over 30 days.We also noted that grant reimbursements were not submitted within 90 days on 15 of 25 Transit Cluster disbursements tested. Of those 15 instances,three disbursements did not have a reimbursement requested for over 90 days and were requested after the end of fiscal year 2025. — Criteria All grant activities should include management level oversight to ensure timeliness, accuracy, and compliance with specified grant requirements. Cause Lack of proactively drawing down Transit grants in latter half of fiscal year 2025 and lag in payment approvals for vendor invoices. Effect Multiple vendors were not paid for over 30 days after receipt of invoice. Lag in — reimbursement requests can cause cash flow issues. Recommendation A designated management level individual should have oversight to require timely drawdowns of grants and timely payment of invoices. — View of Responsible GRTC acknowledges this finding and will continue to address this issue via updated grant Officials management processes and training additional finance staff on grant writing, pre-award and post-award activities. — 2025-005: Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) — AL# 21.027, Reporting — Significant Deficiency, Controls over Compliance Condition The Company received CSLFRF subrecipient funding from the City of Roanoke(the "City") in the prior year.The funding is governed by a memorandum of understanding(MOU) between the City and the Company. The City provided these CSLFRF funds to the Company for the Company to provide Micro Transit services with ADA-accessible vehicles and to purchase bus shelters, sidewalk improvements, and other improvements for high-use transit locations. Within Article Ill of the MOU,the Company was required to submit an annual written report by December 1, 2023 and each following year through December 1, 2025 that included a narrative explaining how and on what expenses the funding was spent and other project specific information. We noted that an annual report was not submitted on December 1, _ 2023 or December 1,2024.This results in a material departure from the MOU and a violation of the reporting compliance attribute for CSLFRF. Criteria Annual reporting requirements as mandated by the MOU should be prepared and submitted — to maintain compliance with the agreement. Cause Lack of proactive grant administration of CSLFRF funds. Effect The reporting requirements for the CSLFRF program were not met. Recommendation A designated management level individual should have oversight of funds received under federal programs and ensure that any applicable reporting requirements are properly — prepared, reviewed, and submitted to their applicable grantor organization. 31 — PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company (A Component Unit of the City of Roanoke, Virginia) Schedule of Findings and Questioned Costs June 30, 2025 View of Responsible GRTC concurs with the finding. Due to staff turnover on both the company and city sides the _ Officials Director of Finance wasn't aware of this requirement spelled out in the MOU. It didn't come to their attention until the audit finding disclosed such information. Given that these funds are now exhausted GRTC doesn't see a pressing prospective remedy is needed however in the future will be more diligent in reviewing and abiding by strictures in funding agreements. In company's defense not once did anyone at the City remind or even notify GRTC that this information was needed/requested/desired at any time. _ 2025-006: Formula Grants for Rural Areas — AL# 20.509, Cash Management — Significant Deficiency, Controls over Compliance Condition We noted four instances out of 25 where contractors and vendors were not paid for over 30 days.We also noted that grant reimbursements were not submitted within 90 days on 23 of 25 20.509 program disbursements tested. Of those 23 instances, eight disbursements did not have a reimbursement requested for over 90 days and were requested after the end of fiscal year 2025. Criteria All grant activities should include management level oversight to ensure timeliness, accuracy, and compliance with specified grant requirements. Cause Lack of proactively drawing down 20.509 program grants in fiscal year 2025 and lag in payment approvals for vendor invoices. Effect Multiple vendors were not paid for over 30 days after receipt of invoice. Lag in reimbursement requests can cause cash flow issues. _ Recommendation A designated management level individual should have oversight to require timely drawdowns of grants and timely payment of invoices. View of Responsible GRTC acknowledges this finding and will continue to address this issue via updated grant Officials management processes and training additional finance staff on grant writing,pre-award and post-award activities. D— Findings— Commonwealth of Virginia and Other Nonmajor Federal Program Compliance 2025-007: Virginia Public Procurement Act Prompt Payment Requirement—Material Noncompliance Condition The Company did not pay multiple vendors on a timely basis throughout the year. _ Criteria Section 2.2-4352 of the Code of Virginia requires that every agency of local government that acquires goods or services shall promptly pay for the completed delivered goods or services by the required payment date. The required payment date shall be either (i) the date on which payment is due under the terms of the contract for the provision of the goods or services or (ii) if a date is not established by contract, not more than forty-five days after goods or services are received or the invoice is rendered. Cause Due to delays from accounts payable staff,vendors were not paid in a timely manner. Effect Vendors were not paid timely as required by the Code of Virginia. Recommendation All vendors are to be paid in a timely manner as defined by the Code of Virginia. 32 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company - (A Component Unit of the City of Roanoke, Virginia) Schedule of Findings and Questioned Costs — June 30,2025 View of Responsible In addressing the multiple instances of late vendor payments exceeding 30 days the Director Officials of Finance now reviews the Aged Accounts Payable detailed schedule of outstanding invoices monthly and in a punctual manner as part of the monthly close process. No significantly aged payables existed at year end with the exception of an amount due to a vendor that was due — to a billing error (31-60 day bucket) and only involved one vendor. Many of the tardy payment instances noted above didn't involve nor were the fault of the finance/accounts payable function but instead involved procurement and customer billing issues. For example, — a few buses were invoiced to GRTC in FY25 that preceded the actual specifications. It is the firm policy of GRTC to not pay a vendor for a product that doesn't meet our needs and match the purchase order. _ 33 — PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company (A Component Unit of the City of Roanoke, Virginia) EM Summary Schedule of Prior Audit Findings June 30,2025 MIP A— Findings— Financial Statement Audit MIN 2024-001:Segregation of Duties and Management Oversight (Material Weakness) Condition Due to staff turnover,duties handled by the Director of Finance included incompatible duties during the year under audit such as collection of cash, post receipts to general ledger, and prepare bank deposit slips. In addition, the Inventory Manager has access both to physical _ inventory and to the inventory tracking system Recommendation Steps should be taken to eliminate conflicting duties and implement compensating controls, where possible. Current Status The conflicting duties held by the Director of Finance were mitigated in the current year. However, comment still applicable related to Inventory Manager having access both to physical inventory and to the inventory tracking system.See finding 2025-001. 2024-002: Grant Management and Operating Assistance (Material Weakness) Condition During 2024, various functions related to financial management were not performed timely resulting in difficulties and delays in completion of the annual audit.Additionally, the untimely nature of grant reconciliations and drawdowns has led to significant cash and grant management issues. Recommendation We recommend that the Company establish financial management procedures to ensure that timely reconciliations and submissions of reimbursement requests. We would recommend these procedures be performed monthly and include tracking and '.. reconciling grant activity by type(federal, state, and local) Current Status Grant reconciliations were completed more frequently in the current year and cash flows _ greatly improved. However,we did note two instances where vendors were not paid for over 30 days. We also noted that grant reimbursements were not submitted within 90 days. Similar instance noted in current year at finding 2025-002. 2024-003: Bank Reconciliations (Material Weakness) Condition Monthly bank reconciliations were not prepared by an accountant and reviewed and approved by a supervisor in a timely manner. Recommendation We recommend bank reconciliations be prepared by an accountant and reviewed by a MPsupervisor to ensure unreconciled or unusual items, or other matters noted in the reconciliation,are detected and addressed in a timely manner. Current Status Still applicable but downgraded to a significant deficiency in 2025. Interim Director of Finance turned over in March 2025 which led to delays in the preparation of bank reconciliations.We noted that the bank reconciliations in 2025 were completed more timely than in previous years, noting that the June 2025 bank reconciliation was performed in August 2025. Similar instance noted in current year at finding 2025-003. MO 34 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company — (A Component Unit of the City of Roanoke, Virginia) Summary Schedule of Prior Audit Findings — June 30, 2025 2024-004: Trade Receivables and Revenue—Billing (Material Weakness) — Condition There were multiple customer accounts that were not billed throughout the year as services were provided by the Company. _ Recommendation We recommend billing customers for services rendered in a timely manner to improve cash flow and prevent collection issues. Current Status No longer applicable. Processes fixed and billings completed timely in 2025. — B — Findings and Questioned Costs— Major Federal Award Program Audit _ 2024-005:Federal Transit Cluster—AL#20.507, Cash Management—Material Noncompliance/Material Weakness in Controls over Compliance — Condition A lack of cash flow and grant management oversight resulted in contractors and vendors not being paid timely during FY2024. We noted 14 instances where contractors and vendors — were not paid for over 30 days.We also noted four vendors were not paid for over 90 days. Recommendation A designated management level individual should have oversight to require timely drawdowns of capital grants and timely payment of invoices. — Current Status Grant reconciliations were completed more frequently in the current year and cash flows greatly improved. However,we did note two instances where vendors were not paid for over 30 days. We also noted that grant reimbursements were not submitted within 90 days on 15 — of 25 Transit Cluster disbursements tested. Of those 15 instances, three disbursements did not have a reimbursement requested for over 90 days and were requested after the end of fiscal year 2025. Similar instance noted in current year at finding 2025-004, which we have designated a significant deficiency this year. — 2024-006:Federal Transit Cluster—AL#20.507, Period of Performance—Significant Deficiency, Controls over Compliance _ Condition There were numerous grants awarded to the Company that had award end dates prior to June 30, 2024,that had not been appropriately closed out at year-end. Recommendation A designated management level individual should close out all grant awards whose period of performance has expired within the grants management system. Current Status No longer applicable. During the year, management closed out all expired federal awards or — obtained extensions for existing grants. 2024-007: Federal Transit Cluster—AL#20.507, Procurement—Finding, Non-material Non-Compliance — Condition As award recipients of Federal Transit Administration (FTA) funds,the Company is required to include certain clauses in contracts funded by FTA funds. We noted that the Company did — not include the required "prohibition on certain telecommunications and video surveillance services or equipment" clause and the "notification of legal matters" clause as required clauses in their procurement manual and did not contain these clauses in one contract tested. — 35 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company (A Component Unit of the City of Roanoke, Virginia) Summary Schedule of Prior Audit Findings June 30,2025 Recommendation We recommend that the Company incorporate these required FTA clauses in their procurement manual and their standard contracts to properly incorporate in any future FTA — funded contracts. Current Status No longer applicable. New grant contract matrix used during the year that included necessary clauses. C— Findings—Commonwealth of Virginia and Other Nonmajor Federal Program Compliance — 2024-008: Virginia Public Procurement Act Prompt Payment Requirement Condition The Company did not pay multiple vendors on a timely basis throughout the year. Recommendation All vendors are to be paid in a timely manner as defined by the Code of Virginia. Current Status Still applicable. See similar instance at 2025-007. 2024-009: Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) —AL#21.027, Allowable Costs- - Material Noncompliance/Material Weakness in Controls over Compliance Condition The Company received CSLFRF funding from the City of Roanoke (the"City") during the year under audit, and allowable costs of the funds were governed by a memorandum of understanding (MOU) between the City and the Company. The City provided these CSLFRF funds to the Company for the Company to provide Micro Transit services with ADA- _ accessible vehicles and to purchase bus shelters, sidewalk improvements, and other improvements for high-use transit locations. These funds were used to cover operating expenses during the year,which did not fall under the allowed uses enumerated in the MOU with the City. Recommendation A designated management level individual should have oversight over the disbursement and tracking of CSLFRF funds to ensure compliance with the MOU. Current Status No longer applicable. All expenditures tested for the CSLFRF program were for allowable costs in 2025. 36 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY 1111 BROWNEDWARDS certified public accountants Required Communication with Those Charged with Governance at Audit Conclusion Board of Directors Greater Roanoke Transit Company Roanoke,Virginia We have audited the financial statements of the Greater Roanoke Transit Company, a component unit of the City of Roanoke, Virginia, hereafter referred to as the "Company", for the year ended June 30, 2025. Professional standards require that we provide you with information about our responsibilities under generally accepted auditing standards, Government Auditing Standards, and the Uniform Guidance, as well as certain information related to the planned scope and timing of our audit. We have communicated such information in our letter to you on May 16, 2025. Professional standards also require that we communicate to you the following information related to our audit. Significant Audit Findings Qualitative Aspects of Accounting Practices Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by the Company are described in Note 1 to the financial statements.As described in Note 1 to the financial statements, the Company adopted new accounting standards for 2025: GASB Statement No. 101, Compensated Absences, GASB Statement No. 103, Financial Reporting Model Improvements, and GASB Statement No. 104, Disclosure of Certain Capital Assets. The cumulative effect of the accounting change as of the beginning of the year is reflected in Note 9 to the financial statements. We noted no transactions entered into by the Company during the year for which there is a lack of authoritative guidance or consensus. All significant transactions have been recognized in the financial statements in the proper period. Accounting estimates are an integral part of the financial statements prepared by management and are based on management's knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ significantly from those expected. The most sensitive estimates affecting the Company's financial statements were: • The useful lives of capital assets are based on management's knowledge and judgment, which is based on history. • The liability for accrued compensated absences is based on management's estimate of the amount of leave that is more likely than not to be used for time off or otherwise paid in cash or settled through noncash means. www.becpas.com PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY We evaluated the key factors and assumptions used to develop these estimates in determining that they are reasonable in relation to the financial statements taken as a whole. Certain financial statement disclosures are particularly sensitive because of their significance to financial statement users. The most sensitive disclosures affecting the financial statements include those related to: • Capital assets and litigation. The financial statement disclosures are neutral,consistent, and clear. Difficulties Encountered in Performing the Audit We encountered no significant difficulties in dealing with management in performing and completing our audit. Corrected and Uncorrected Misstatements Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that are clearly trivial, and communicate them to the appropriate level of management. Management has corrected all such misstatements. The attached audit adjustments were proposed and were recorded by the Company. The financial statements are comparative.As such,the impacts of implementing GASB 101,Compensated Absences, are to be restated to the beginning of the earliest year presented, which would be June 30, 2023 for the financial statements. The resulting impact of implementing GASB 101 was immaterial, resulting in a change to the liability of approximately$62,000, which was adjusted through restating the June 30, 2024 financial statements. However, due to the immaterial nature of this adjustment, it was deemed unnecessary to also determine the impact as of June 30, 2023 or restate beginning net position as of June 30, 2023. As of June 30, 2024 and 2025 net position is correct. Disagreements with Management For purposes of this letter, a disagreement with management is a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditor's report.We are pleased to report that no such disagreements arose during the course of the audit. Management Representations We have requested certain representations from management that are included in the management representation letter dated , 2026, a copy of which is attached. 2 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Management Consultations with Other Independent Accountants In some cases,management may decide to consult with other accountants about auditing and accounting matters,similar to obtaining a"second opinion"on certain situations.If a consultation involves application of an accounting principle to the Company's financial statements or a determination of the type of auditor's opinion that may be expressed on those statements, our professional standards require the consulting accountant to check with us to determine that the consultant has all the relevant facts.To our knowledge,there were no such consultations with other accountants. Other Audit Findings or Issues We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to retention as the Company's auditors. However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition to our retention. We will also communicate with management in a management letter. Other Matters We applied certain limited procedures to management's discussion and analysis, which is required supplementary information (RSI) that supplements the basic financial statements. Our procedures consisted of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements,and other knowledge we obtained during our audit of the basic financial statements. We did not audit the RSI and do not express an opinion or provide any assurance on the RSI. We were engaged to report on the schedule of expenditures of federal awards, which accompanies the financial statements but is not RSI. With respect to this supplementary information, we made certain inquiries of management and evaluated the form,content, and methods of preparing the information to determine that the information complies with accounting principles generally accepted in the United States of America,the method of preparing it has not changed from the prior period,and the information is appropriate and complete in relation to our audit of the financial statements. We compared and reconciled the supplementary information to the underlying accounting records used to prepare the financial statements or to the financial statements themselves. We were not engaged to report on the introductory section, which accompanies the financial statements but is not RSI. Such information has not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or provide any assurance on it. 3 PRELIMINARY DRAFT—OPEN FOR REVIEW AND DISCUSSION ONLY Restrictions on Use This information is intended solely for the information and use of the Board of Directors and management of the Company and is not intended to be, and should not be, used by anyone other than these specified parties. CERTIFIED PUBLIC ACCOUNTANTS Roanoke,Virginia , 2026 4 PRELIMINARY DRAFT-OPEN FOR REVIEW AND DISCUSSION ONLY Greater Roanoke Transit Company Audit Adjustments-Year ended June 30,2025 Account Description Debit Credit Adjusting Journal Entries Adjusting Journal Entries JE#1 To correct CSLFRF Cash,Revenue,Expense,and Deferred Revenue. 10200 Cash-ARPA $ 260,541.25 50802 MetroFlex Contract Fee 30,000.00 52050 MetroFlex ARPA Operating 77,585.75 10107 Cash-General-Transition $ 260,541.25 20904 Deferred MetroFlex Revenue-ARPA 77,585.75 50313 Marketing Expense 30,000.00 Total 368,127.00 368,127.00 Adjusting Journal Entries JE#2 To reclass items from State to Federal revenue.Properly recorded on SEFA as federal operating assistance passed through the state,should be in federal account. 52024 Operating Assistance-State 969,022.33 52017 Operating Assistance-Federal 969,022.33 Total 969,022.33 969,022.33 Adjusting Journal Entries JE#5 To reclassify operatingvs capital per work performed on grant accounts receivable and testing completed during Single Audit. 53001 Capital Contributions Federal 106,226.00 52017 Operating Assistance-Federal 106,226.00 Total $ 106,226.00 $ 106,226.00 -------------- GREATER ROANOKE TRANSIT COMPANY (A Component Unit of the City of Roanoke,Virginia) Statement of Revenues,Expenses and Changes in Net Position(Unaudited) For the Two Months Ended August 31,2025 August FY26 August FY25 $Change %Variance Commentary Operating Revenues: Charges for Passenger Fares $ 188,993 $ 208,426 (19,433) -9% Something to monitor since FY25 by comparison was trending up compared to FY24. Operating Expenses: Labor-Salaries,Wages and Fringe Benefits $ 1,012,792 $ 995,231 17,561 2% Annual raises(3%)went into effect July 1st Contractual fees-Star&Metroflex operating deficits rising over Purchased Services-Transportation 780,219 742,839 37,380 5% the past year with flat revenue and inflation pressures on the expense side. Fuel,Lubricants and Parts 228,660 222,647 6,013 3% Management fees are up 3%but maintenance and contractual Purchased Services-Other 201,501 236,752 (35,251) -15% services are down yoy.Not that there are less needs(It's being deferred). Utilities and Insurance 77,557 118,808 (41,251) -35% Timing difference with billing Maintenance,Supplies and Other 24,230 29,242 (5,012) -17% Amortization 6,708 - 6,708 #DIV/01 Lease Liability per GASB 87 Depreciation 526,882 501,230 25,652 5% Consistent with expectations Total Operating Expenses $ 2,858,548 $ 2,846,749 11,799 0% Operating Loss $ (2,669,555) $ (2,638,323) (31,232) 1% Nonoperating Revenues(Expenses): #DIV/0! Operating Assistance-Federal $ _ $ - - - #DIV/0! Federal Capital Maintenance Grants 46,490 #DIV/0! Capital Contributions-Federal 46,490 Operating Assistance-Commonwealth 798,337 858,496 (60,159) -7% - #DIV/0! Capital Contributions-Commonwealth Operating Assistance-City of Roanoke - 1,081,154 (1,081,154) -100% First subsidy in FY26 was recorded in September FY24 numbers included some marketings expenses associated Operating Assistance-Metro Flex 185,696 250,371 (64,675) -26% with the metro-flex campaign aimed at augmenting awareness Operating Assistance-Other Localities and NonProfits 177,274 149,900 27,373 18% Consistent with expectations-nominal increases over prior year Advertising Income 33,337 50,061 (16,724) -33% Timing Interest and Miscellaneous Income 21,287 1,496 19,791 1323% Bank Adjustment Total Nonoperating Revenue $ 1,262,419 $ 2,391,478 (1,129,059) -47% Change in Net Position $ (1,407,136) $ (246,845) (1,160,290) 470% Total Net Position,Beginning $ 32,466,853 $ 32,892,502 (425,649) -1% Total Net Position,Ending $ 31,059,717 $ 32,645,657 (1,585,940) -5% 1 GREATER ROANOKE TRANSIT COMPANY (A Component Unit of the City of Roanoke,Virginia) Statement of Net Position(Unaudited) As of August 31,2025 Assets Current Assets: August FY26 August FY25 $Change %Variance Commentary Grant approvals have been slow at the federal level.Also waiting on DRPT fund installment Cash and Cash Equivalents $ 1,082,688 $ 1,773,013 (690,325) -39% for metro-flex of$75k.Ridership is down from last year thru two months. ARPA award drying up based on monthly transfers to Operating Cash to cover Metroflex Cash and Cash Equivalents-MetroFlex 290,724 1,204,933 (914,209) -76% operational costs.We have replaced this with a 3 year DRPT Pilot. Petty Cash and Change Funds - 3,710 3,455 255 7% Less grant revenue overall coming in due to the backlog of approvals at the FTA and DRPT. Accounts Receivable 959,297 1,729,870 (770,574) -45% This is consistent with expectations based on overall grant revenue in FY25 vs.FY24. Expense associated with this not keeping pace with the orders.Ordering has been up; Fuel,Lubricants and Parts 542,840 481,505 61,335 13% more in stock. Prepaid Assets 149,151 144,013 5,138 4% Total Current Assets $ 3,028,410 $ 5,336,789 $(2,308,379) -43% Capital Assets: Land $ 1,627,487 $ 1,627,487 - 0% Leased Assets 80,497 - 80,497 #DIV/01 Capitalized Lease-RJ Young Printer/Copier per GASB 87 Buildings,Structures and Improvements 22,151,963 22,151,963 - 0% Buses&Related Equipment 26,390,199 24,392,343 1,997,856 8% 3 new electric buses acquired in April 2025 Shop and Garage Equipment 3,473,818 3,437,108 36,711 1% Office Equipment and Furnishings 702,285 702,285 - 0% Bus shelter construction really ramped up in FY25 coupled with the new Valley Metro Construction in Progress 273,015 20,705 252,310 1219% website design costs. Accumulated Depreciation (25,223,803) (23,072,469) (2,151,333) 9% Electric buses Accumulated Amortization (6,708) - (6,708) #DIV/01 Lease Liability-RJ Young Printer/Copier per GASB 87 Capital Assets,Net $ 29,468,752 $ 29,259,421 $ 209,331 1% Total Assets $ 32,497,162 $ 34,596,210 $(2,099,048) -6% Liabilities Current Liabilities: Balance was unusually high.Owed$780k to one vendor UHS for 2 months worth of Accounts Payable 1,038,293 225,898 812,395 360% Metroflex&Star Line fees.A billing discrepancy was to blame Current AP is down to $658k. At FY24 YE there were significant liabilities accrued that were missed throughout the Other Accrued Purchases 8,022 277,533 (269,511) -97% course of the year.In FY25 these obligations were recorded and paid in a timely manner hence Year End FY25 didn't require any such adjustments. Lease Liabilities 72,778 - 72,778 #DIV/01 Lease Liability-RI Young Printer/Copier per GASB 87 Payroll Tax Liabilities 1,669 1,576 92 6% This will be reduced by roughly$36k when the over-cap balances are settled on January Accrued Leave 203,516 235,212 (31,696) -13% 22nd paydate. Due to Federal Government 5,400 5,400 - 0% Federal equipment sales rebate liability Drop in unearned ARPA revenue proportional to the reduction in ARPA Cash,which is Unearned Revenue-ARPA 107,768 1,204,933 (1,097,164) -91% consistent with expectations as the revenue is recognized monthly to fund metroflex costs. All was spent by the December 1,2025 deadline. Total Current Liabilities $ 1,437,445 $ 1,950,552 $ (513,107) #D1V/01 Net Position Net Investment in Capital Assets $ 29,468,752 $ 29,259,421 209,331 1% Unrestricted 1,590,965 3,386,237 (1,795,272) -53% Total Net Position $ 31,059,717 $ 32,645,657 $(1,585,941) -5% I GREATER ROANOKE TRANSIT COMPANY (A Component Unit of the City of Roanoke,Virginia) Statement of Revenues,Expenses and Changes in Net Position(Unaudited) For the Two,Months Ended August 31,2025 August FY26 August FY25 $Change %Variance Commentary Operating Revenues: Charges for Passenger Fares $ 188,993 $ 208,426 (19,433) -9% Something to monitor since FY25 by comparison was trending up compared to FY24. Operating Expenses: Labor-Salaries,Wages and Fringe Benefits $ 1,012,792 $ 995,231 17,561 2% Annual raises(3%)went into effect July 1st Contractual fees-Star&Metroflex operating deficits rising over Purchased Services-Transportation 780,219 742,839 37,380 5% the past year with flat revenue and.inflation pressures on the expense side. Fuel,Lubricants and Parts 228,660 222,647 6,013 3% Management fees are up 3%but maintenance and contractual Purchased Services-Other 201,501 236,752 (35,251) -15% services are down yoy.Not that there are less needs(It's being deferred). Utilities and Insurance 77,557 118,808 (41,251) -35% Timing difference with billing Maintenance,Supplies and Other 24,230 29,242 (5,012) -17% Amortization 6,708 - 6,708 #DIV/0! Lease Liability per GASB 87 Depreciation 526,882 501,230 25,652 5% Consistent with expectations Total Operating Expenses $ 2,858,548 $ 2,846,749 11,799 0% Operating Loss $ (2,669,555) $ (2,638,323) (31,232) 1% Nonoperating Revenues(Expenses): #DIV/0! Operating Assistance-Federal $ _ $ - #DIV/0! Federal Capital Maintenance Grants - 46,490 #DIV/0! Capital Contributions-Federal 46,490 Operating Assistance-Commonwealth 798,337 858,496 (60,159) -7% Capital Contributions-Commonwealth - #DIV/0! Operating Assistance-City of Roanoke - 1,081,154 (1,081,154) -100% First subsidy in FY26 was recorded in September FY24 numbers included some marketings expenses associated Operating Assistance-Metro Flex 185,696 250,371 (64,675) -26% with the metro-flex campaign aimed at augmenting awareness Operating Assistance-Other Localities and NonProfits 177,274 149,900 27,373 18% Consistent with expectations-nominal increases over prior year Advertising Income 33,337 50,061 (16,724) -33% Timing Interest and Miscellaneous Income 21,287 1,496 19,791 1323% Bank Adjustment Total Nonoperating Revenue $ 1,262,419 $ 2,391,478 (1,129,059) -47% Change in Net Position $ (1,407,136) $ (246,845) (1,160,290) 470% Total Net Position,Beginning $ 32,466,853 $ 32,892,502 (425,649) -1% Total Net Position,Ending $ 31,059,717 $ 32,645,657 (1,585,940) -5% GREATER ROANOKE TRANSIT COMPANY • (A Component Unit of the City of Roanoke,Virginia) Statement of Net Position(Unaudited) As of August 31,2025 Assets Commentary Current Assets: August FY26 August FY25 $Change %Variance Grant approvals have been slow at the federal level.Also waiting on DRPT fund installment Cash and Cash Equivalents $ 1,082,688 $ 1,773,013 (690,325) _39ry, for metro-flex of$75k.Ridership is down from last year thru two months. ARPA award drying up based on monthly transfers to Operating Cash to cover Metroflex Cash and Cash Equivalents-MetroFlex 290,724 1,204,933 (914,209) -76% operational costs.We have replaced this with a 3 year DRPT Pilot. Petty Cash and Change Funds 3,710 3,455 255 7% 1,729,870 (770,574) _q5% Less grant revenue overall coming in due to the backlog of approvals at the FTA and DRPT. 959,297 Accounts Receivable This is consistent with expectations based on overall grant revenue in FY25 vs.FY24. Expense associated with this not keeping pace with the orders.Ordering has been up; Fuel,Lubricants and Parts 542,840 481,505 61,335 13% more in stock. Prepaid Assets 149,151 144,013 5,138 4% Total Current Assets $ 3,028,410 $ 5,336,789 $(2,308,379) -43% Capital Assets: Land $ 1,627,487 $ 1,627,487 - 0% • Leased Assets 80,497 - 80,497 #DIV/01 Capitalized Lease-RJ Young Printer/Copier per GASB 87 Buildings,Structures and Improvements 22,151,963 22,151,963 - 0% Buses&Related Equipment 26,390,199 24,392,343 1,997,856 8% 3 new electric buses acquired in April 2025 Shop and Garage Equipment 3,473,818 3,437,108 36,711 1% Office Equipment and Furnishings 702,285 702,285 - 0% Bus shelter construction really ramped up in FY25 coupled with the new Valley Metro Construction in Progress 273,015 20,705 252,310 '1219% Webslte design costs. Accumulated Depreciation (25,223,803) (23,072,469) (2,151,333) 9% Electric buses Accumulated Amortization (6,708) - (6,708) #DIV/01 Lease Liability-RI Young Printer/Copier per GASB 87 Capital Assets,Net $ 29,468,752 $ 29,259,421 $ 209,331 1% Total Assets $ 32,497,162 $ 34,596,210 $(2,099,048) -6% Liabilities Current Liabilities: Balance was unusually high.Owed$780kto one vendor UHS for 2 months worth of Accounts Payable 1,038,293 225,898 812,395 360% Metroflex&Star Line fees.A billing discrepancy was to blame Current AP is down to $658k. At FY24 YE there were significant liabilities accrued that were missed throughout the Other Accrued Purchases 8,022 277,533 (269,511) -97% course of the year.In FY25 these obligations were recorded and paid in a timely manner hence Year End FY25 didn't require any such adjustments. Lease Liabilities 72,778 - 72,778 #DIV/01 Lease Liability-R1 Young Printer/Copier per GASB 87 Payroll Tax Liabilities 1,669 1,576 92 6% This will be reduced by roughly$36k when the over-cap balances are settled on January Accrued Leave 203,516 235,212 (31,696) -13% 22nd paydate. Due to Federal Government 5,400 5,400 - 0% Federal equipment sales rebate liability Drop in unearned ARPA revenue proportional to the reduction in ARPA Cash,which is Unearned Revenue-ARPA 107,768 1,204,933 (1,097,164) -91% consistent with expectations as the revenue is recognized monthly to fund metroflex costs. All was spent by the December 1,2025 deadline. Total Current Liabilities $ 1,437,445 $ 1,950,552 $ (513,107) 8DIV/0! Net Position Net Investment in Capital Assets $ 29,468,752 $ 29,259,421 209,331 1% Unrestricted 1,590,965 3,386,237 (1,795,272) -53% Total Net Position $ 31,059,717 $ 32,645,657 $(1,585,941) -5% lam January 20,2026 Dear President Cobb and Members of the Board: Subject:Authorization to File for Federal Transit Administration Operating and Capital Financial Assistance,and Commonwealth of Virginia Operating and Capital Financial Assistance for Fiscal Year(FY) 2026-2027. Background Financial assistance has been provided to Greater Roanoke Transit Company(GRTC) by the Federal Transit Administration (FTA)and the Commonwealth of Virginia Department of Rail and Public Transportation (VDRPT)during previous fiscal years for certain operating and capital expenses. Under FTA regulations,GRTC is eligible for federal operating funds,which cannot exceed 50%of its proposed operating deficit. In FY 2026—2027,GRTC will apply for the maximum amount allowed in federal operating and capital financial assistance. The deadline for filing the applications for the above referenced assistance for FY 2026-2027 is February 1, 2026. Recommendation Authorize the General Manager or,Assistant General Manager to file applications requesting the maximum operating and capital financial assistance from FTA and VDRPT for FY 2026-2027 and to accept and execute the necessary grant agreements in a form approved by General Counsel. Respectfully bmitted, K m rice Gene I Manager Cc: Vice President of Operations Assistant Vice President of Operations Treasurer Secretary GRTC General Counsel Municipal Auditor • Greater Roanoke Transit Company P.O.Box 13247 Roanoke,Virginia 24032 Phone:(540)982-0305 Fax:(540)982-2703 www.valleymetro.com I 1 L/ BOARD OF DIRECTORS OF THE GREATER ROANOKE TRANSIT COMPANY A RESOLUTION authorizing the filing of applications with the Federal Transit Administration ("FTA") and the Commonwealth of Virginia Department of Rail and Public Transportation("DRPT"), for Fiscal Year 2026-2027. WHEREAS, the Federal Transit Administrator has been delegated authority to award Federal operating and capital financial assistance for the Fiscal Year 2026-2027; WHEREAS, the grant or cooperative agreement for Federal financial assistance will impose certain obligations upon Greater Roanoke Transit Company("GRTC") and cannot exceed 50% of its proposed operating deficit; and WHEREAS, for the Fiscal Year 2026-2027, GRTC will apply for the maximum amount allowed in federal operating and capital financial assistance. THEREFORE, BE IT RESOLVED by the Board of Directors of the Greater Roanoke Transit Company as follows: 1. The Board of Directors of GRTC designates that GRTC's General Manager and/or Assistant General Manager are each authorized to execute and file applications for Federal operating and capital financial assistance on behalf of GRTC with FTA and DRPT for the Fiscal Year 2026-2027 authorized by 49 U.S.C. Chapter 53, and/or authorized by any other Federal statutes administered by the FTA, including, but not limited to, applicable section of 23 U.S.C. Chapter 23. GRTC is the Designated Recipient as defined by 49 U.S.C. Sec.5302(3). 2. GRTC's General Manager and/or Assistant General Manager are each designated and authorized to execute and file with its application(s) the annual certification and assurances and other documents FTA and DRPT require before awarding a Federal assistance grant or cooperative agreement. 3. GRTC's General Manager and/or Assistant General Manager are each designated and authorized to execute grant and cooperative agreements with FTA and DRPT on behalf of GRTC, in a form approved by General Counsel, all as more particularly set forth in the report of the General Manager to this Board dated January 20, 2026. The Company's Secretary is also authorized to attest any such document. CERTIFICATE AUTHORIZING RESOLUTION The undersigned duly qualified Secretary, acting on behalf of GRTC, certifies that the foregoing is a true and correct copy of a resolution adopted at a legally convened meeting of the Board of Directors of the Greater Roanoke Transit Company("GRTC")held on January 20,2026. ATTEST: • Secretary. *C..) BOARD OF DIRECTORS OF GREATER ROANOKE TRANSIT COMPANY A RESOLUTION approving and adopting Fare Free Transit Equity Day Service,for Wednesday, February 4, 2026, for the Greater Roanoke Transit Company (GRTC) DBA Valley Metro; and authorizing the General Manager of GRTC to take appropriate action to implement such Fare Free Transit Equity Day Service for Wednesday,February 4, 2026. BE IT RESOLVED by the Board of Directors of the Greater Roanoke Transit Company as follows: 1. The Board of Directors hereby approves and adopts Fare Free Transit Equity Day Service for Wednesday, February 4, 2026. 2. The above passenger Fare Free Transit Equity Day Service shall be effective• on Wednesday, February 4, 2026. 3. The General Manager of GRTC is hereby authorized to take appropriate action to implement and administer the Fare Free Transit Equity Day Service for Wednesday, February 4, 2026, set forth above, subject to any needed approval by the Council of the City of Roanoke. ATTEST: (atL, mac,/ ,\\._\l.4^^�' Secretary. ' %!- ✓ i .F `� Well II4ey • Greater Roanoke Transit Company Board of Directors Meeting January 20, 2026 Honorable Joseph L. Cobb, President, and Members and Officers of the Board of Directors Greater Roanoke Transit Company Roanoke,Virginia Subject:Authorization—Fare Free Transit Equity Day Service—February 4,2026 Background Transit Equity Day commemorates the legacy of civil rights leader Rosa Parks and acknowledges the pivotal role of accessible public transportation in fostering equitable, inclusive communities. Every day, millions rely on public transit as a lifeline, connecting them to work, education, healthcare, and social opportunities. The provision of Fare Free Transit Equity Day Service celebrates the legacy of Rosa Parks and acknowledges the importance of accessibility, affordability, environmental justice, and community {° engagement as it relates to public transportation. Recommendation Authorize the provision of Fare Free Transit Equity Day Service on Wednesday, February 4, 2026. Respectfully Su mitted, } evi .Price Ge ral Manager Cc: Vice President of Operations Assistant Vice President of Operations Treasurer Secretary General Counsel Municipal Auditor Greater Roanoke Transit Company P.O.Box 13247 Roanoke,Virginia 24032 Phone:(540)982-0305 Fax:(540)982-2703 www.valleymetro.com GRTC Performance Statistics FY2024 Statistics(Validated/National Transit Database) FY24 FY25 FY26 FY27 .Passengers per . revenue mile Passengers per 13.65 revenue hour (15) Cost perrevenue- 9 13 mile($) Cost per revenue 148.73 hour($) Cost per`passenger -10 89 (10) trip($).' • _ _ - ..„ t ,, _ - . ... _ _ e_Farebox Recovery 13 (%) (15) Accidents per 10000 106 passenger trips= i Population within 132,800 one half mile of a (217,312) bus stop(Roanoke UZA) _ Or times 80 Performance(%) (75) Transit stops with 15 passenger amenities (bench,shelter, trashcan)—825 Total Stops(%) evi .Price G eral Manager Copy: Vice President of Operations Assistant Vice President of Operations Treasurer Secretary GRTC General Counsel Municipal Auditor Greater Roanoke Transit Company P.O.Box 13247 Roanoke,Virginia 24032 Phone:(540)982-0305 Fax:(540)982-2703 www.valleymetro.com 1108 Campbell Ave SE Roanoke,VA 24013 Va�♦E.y P :540-982-2222 I F :540 982 2703 www.valleymetro.com TPAC Meeting Notes from November 13,2025 November 13,2025—6:30pm Virtual Meeting 1.Welcome/Roll Call TPAC Member Present Steve Grammer X Laura Hartman X Cole Kiester Sean McGinnis X Ginny Pannabecker X Alison Stinnette X Hope Trachtenberg-Fifer X Sharon Fritz Vacant GRTC William Long X Ron Parker X GRTC Board Karen Michalski-Karney X Guest Justin X Yvonne X Jeff X 2. GRTC Updates a. Stop/Shelter Updates • None b. Routes/Schedules • William Long mentioned that the next few months are some of the busiest in terms of _-_detours around parades and other events as well as holiday closures. All Valley Metro communications channels will update riders and the community with service alerts. • William noted the snowy forecast for the upcoming winter.Preparations are already being made at Third Street Station. Snow routes are on the Valley Metro website, and all communications channels will update riders and the community with snow route and closure alerts. o Steve Grammer asked how bus stops are cleared of snow and ice. Karen Micahlski-Karney said that she would bring snow clearance—particularly around bus stops—to the next GRTC board meeting. c.Ridership Page 1 1108 Campbell Ave SE Roanoke,VA 24013 Valley P :540-982-2222 I F : 540 982 2703 www.valleymetro.com • William Long reviewed ridership updates.Valley Metro provided fare-free service on Election Day (November 4,2025)and shared the ridership numbers compared to average numbers. d. Other Updates • William Long announced that Valley Metro will host a 50-year anniversary celebration at Third Street Station on Tuesday,November 18, at 10:30am. The 50-years logo will be revealed. • According to the TPAC charter, committee officers need to be selected, and new officers will fulfill their roles beginning at the February 12,2026,meeting. o The TPAC Chair will help develop meeting agendas,facilitate the discussion, and lead committee communications. Laura Hartman nominated Hope Trachtenberg- Fifer as Chair,and Hope accepted. o The TPAC Vice Chair will assist the Chair in agenda development and meeting facilitation,acting as Chair in the Chair's absence, as well as lead the accessibility subcommittee when formed. Hope nominated Sean McGinnis,who declined. Laura nominated Steve Grammer, and Steve accepted. o The TPAC Secretary will record meeting notes and distribute them to committee members,attending GRTC board members,and GRTC staff.Laura nominated Ginny Pannabecker, and Ginny accepted. ■ Ginny noted that she will unable to attend the February and April 2026 meetings, and Laura will fulfill this role in her absence. o Hope requested the roster and contact information for TPAC members. o Laura asked how meeting agendas and notes will be stored. Hope asked about the possibility of shared files on Valley Metro servers,and Laura asked about shared space on the City of Roanoke servers. ■ Laura and Ginny will investigate options for sharing documents with TPAC officers. e.Follow-up Items • William Long mentioned discussion with RADAR regarding coming improvements. RADAR indicated that it is working on online features, including fare payment options and online scheduling,in the month of November. These features will allow riders to track buses and to receive notifications.Right now,riders can indicate the desire for a call or text message when the bus is close by. This is not automated now but will be with the new online features. o Steve Grammer voiced frustrations regarding the inability to schedule rides without calling. William said that online scheduling will be one of these new features. o Ginny Pannabecker asked if the app will show the bus's capacity. William said that it's unlikely,but that STAR and MetroFLX rides are scheduled, and the system will not allow scheduling an overfull bus. 4. Questions/Comments Page 2 MMEn 1108 Campbell Ave SE Roanoke,VA 24013 I II y, P : 540-982-2222 1F :540 982 2703 www.valleymetro.com • Hope Trachtenberg-Fifer mentioned a concern over the state of some of the bus stops in the system,specifically that many do not have a concrete pad nor sidewalks for accessibility. Karen Michalski-Karney asked if there's a prioritized list for stop updates. William Long answered that Valley Metro has a prioritized list for bus stop improvements and that the localities have lists for other pedestrian facilities. Alison Stinette noted that RVTPO has requested the sidewalk plans from the City of Roanoke as part of the ongoing Bus Stop Accessibility Study. o Karen said that the City of Roanoke is typically responsive to requests for curb cuts and noted the number of curb cuts currently being installed. o Steve Grammer asked about curb cuts at the Valley View/Walmart stop. William answered that work on this stop continues, and Walmart is planning some changes to the parking lot that may affect the bus stop and its location.Those negotiations are ongoing. o Hope asked about the possibility of raising fares to create funds for bus stop improvements. Laura Hartman noted that fare increases may not be the most equitable way to fund accessibility projects. • Hope voiced frustration that TPAC has not been notified of news regarding GRTC, instead finding out in the newspaper. Laura noted that the article referred to a decision by the GRTC board rather than Valley Metro staff, and that the TPAC charter clarifies that TPAC communicates recommendations to the GRTC board,but that board decisions aren't necessarily communicated directly to TPAC. • Laura noted concern over the number of Valley Metro operators, specifically long shifts and the inability to expand services due to low numbers.William answered that low operator numbers have been an issue since pandemic shutdowns and recruiting new operators has been a continual task. o Laura asked about renegotiation with MetroFLX operators as the pilot program ends and the service is extended.William said that updates will be brought to the next meeting. • Laura said that a member of the Summit Hills Neighborhood Group expressed concern over the Melrose EB at Peck bus stop. William described the factors in bus stop placement at this location,noting the odd roadway configuration, drainage infrastructure, and property ownership issues. The stop was moved to its current location as the safest choice in the area and to avoid eliminating the stop altogether. o TPAC members discussed various possible solutions to accessibility at this stop and across the service area. Alison Stinnette noted that the Bus Stop Accessibility Study is considering options for bus stop balancing—optimizing distances between stops—which takes into account accessibility,ridership, and on-time performance. Alison also said that the City of Roanoke is working on accessibility plans through each quadrant of the city. Karen said that she will bring this topic to the GRTC board. • Laura asked about adding names to the Wall of Honor at Third Street Station. William answered that design of plaques is currently,underway. • Sean McGinnis asked for an update on the electric buses. William said that the buses are able to run all routes except routes 31 and 32 to Blue Hills due to a low bridge. The buses are able to operate all day; however,the weather has been ideal since the launch in April. Page 3 1108 Campbell Ave SE Roanoke,VA 24013 va„ey` P :540-982-2222/F :540 982 2703 www.valleymetro.com The upcoming cold weather will likely reduce the range, and operations will need to adjust. • Alison announced that the RVARC hosted a group of UVA graduate students last week. The group toured Roanoke, discussing transportation,parking,transit, and regional collaboration. As part of this trip,the group received a tour of Third Street Station. 5.Next Meeting—February 12,2026 • William Long announced that the next meeting is February 12,2026, and shared the 2026 TPAC meeting schedule. 6.Adjourn Page 4 V.C111:111eir Ai, Greater Roanoke Transit Company(GRTC) Board of Directors Meeting Management Update January 20, 2026 Planning and Special Projects TPAC Meeting Update , • On November 13,2025,TPAC held a virtual meeting via Zoom Meeting. Updates on transit ridership,adverse weather preparations,TPAC Officer nominations,and miscellaneous follow-up items were the other topics of • discussion. Staff also responded to questions from TPAC members.The minutes from the November 13,2025, meeting is included in the GRTC Board Packet. GRTC Ridership Update , - ( 1 I I III 1 11 1 ry) L - 0Y26k;?- 1" 4uiy: -_AuBusf September.;ta iifN-vem616Deceinft er lanaary Aebruary'- March rApri ` May y dune -.,.- -Atal ICityRoutes 10,603 I 99,299 I 100,173 1 109,175 5,588 94,058 I 9 I I. I . 3,372- 3,459. SmartWay Base 3010 $,171 3,467 4,532 11 598 'Smart Wa Amtrak 221 325 I 519_ t „634 I 1,060 1364 I i I I 4123 ! Y 9 436 Smart Way Express 1,092 1372 2,054 2 265. 1509. 1144 .} Star Line Trolle 5 229 5,782 I 5,299 15 044 4 368 1 4 750 I j Y i 30 472 8,155 8,453 7,115 6,745.. :7,176. 37,644 STAR 8 487 IMetroFLX I 1,728 i 1,772 I 1,638 1 1,637 1,712 I 9 Total "118,310 118 402 118,627 128,395 '111,543 106,305 0 0 0 0 0 0 - IYfD Total j 118,310 236,712 j 355,339 1483,734 I 595,277 1 701,582 1701582 1 701582 701582 1701,582 i 701582`.201,582 71 DO6 FY2025 July August September October November December January February March April May June. "yearTotal ? ICityRoutes 108 763 112,615I. 103,468 1 118,880 106,260 I 97,756 { 95917 ; 84,954 I 92131 ( 103398I,100004 1 95190 1219,336 I • 4,327 3,599 4,069 :,.3,216 ' 3,052 =:3,795 3,967 :.3,861 .:2,941 43,151 Smart Way-Base -' 2,906 3,771 3,577 - ISmart Way-Amtrak I 689 754, I 642 887 F 61.4 :.291. I 562 1 ,517 j _904 785 424 7,707 638 { � I { Smart Way Express 1,597 ' 1,796 .'1,548 2,233 " 1,677 1,082 1,305 1,726 1,526 2,333 1,183 950 18,956 '`1 IStarLineTrolley I 5,372 5,585 i _5,289 I 5,934 5,248 I 5,073 j 5031 4,957 ; 5,428 t 5902 { 5500 { 5103 64422 STAR 7,016 7,150 7,852 '7,803 '.'7,504 6,456" 6,339 6,220 :7,252 '8,167 6800 7,424 85,983 IMetr Total LX I 1;066 I 1,180 I 1,316 1,285 1,453 1,361 I 1,457 ! 1,445 i 1,475 ! 1,812 1 1,502 I 1,525 16,877 127,409 132,735 123,804 141,304 126,626 '<116,411 113,626 '102,916 112,124 126483 119,635 113557 '1,456,432 'YID Total 1 127,409 1260,144 I 383,948 1525,052 I 651,680 768,091 881,7171 1 984,633 11,096,767 t 1 223 240 1 342 8.75 1.,456,432 I ' I I I =I I y>. ' - a z �June`� yearTptal (,itik21 a=3u August Sept`ejr bet October'Novembe7 December,an ar: eaNary -vFart(t Ap[tl y-,' May ICity Routes j 90,824 1101,999 I 93,429 I 97,155 97,893 I 97,679 92,928 11.03,864 1 98,019 1105,396 1 108 287{ 101,320 1188 793 ', 2,578 3,718 2,242 884 :806 895 2,170 3,700 ". 3,038- 29,690 Smar4Way-Base `2,641 ':4,202 '2,816 i qp8 9372 ISmartWay-AmtrakI 586 I 877 I 955 I 1,258 1,264 I 942 579 t - 44.2 I 503 694 j 864 Smart Way Express ' 851 '1,115 1,294 `.•'2,350 2,053 •• '1,188 '1,835 2,255 1,891 ' 1,860: ,, 1257 :S 1,656 19645 Star Line Trolley I 4,979 ; 5,401 I 4,825 5,311 + 4,905 3,915 1 4,928 I 5,173 I 5,046 I 5 440 5 417 j 5,004 60 344 STAR 6,196 6,969 6,608 7,004 7,092 I 6,652 6,508 •'•7,363 '.7,025 7,586 7396 6,746 83145 IMetroFiX , I 1 20 I 743 I 802 I 922 1 1,073 I 1,199 4,759 Total 106,077 120,563 _'109,927 '• 115,656 '116,925 112,618 107,682 `120,686 114,181 124,068 127994 n 119,371 1,395,748 YTDTotal 106,077 226,640I 336,567 1452,223 '569,148 681,766 ) 789,448I 910,134I1,024,315:1148,383 1,276377i1,395,7481 Greater Roanoke Transit Company P.O,Box 13247 Roanoke,Virginia 24032 Phone:(540)982-0305 Fax:(540)982-2703 www.valleymetro.com