STC RESTRUCTURES FARES TO FACE DEREGULATION

Released on July 7, 1999

The Saskatchewan Transportation Company announced today a major

restructuring of its passenger fares and discount structure to

position the company to face deregulation in the inter-city bus

passenger industry.



"This will be STC's first fare increase in almost four years and it

will still leave us considerably below the industry average," Jim

Hadfield, President and CEO of STC said.



"The Federal Government is looking at deregulating passenger bus

service starting January 1, 2000, and it is expected to be in effect

in Saskatchewan in 2002," Hadfield said. "One area where STC needs a

lot of work done to be ready for an open, competitive marketplace is

in its fares and discount structures.



"Effective September 1, 1999, we will be changing our age categories

to match those of other major carriers in Canada and will be

streamlining our discount programs to bring them in line with the

industry as well."



The new discount structure will be:



Seniors (60-plus), 10 per cent off;



Children under three, free;



Children aged three to seven, 50 per cent off;



Children aged eight to 11, 25 per cent off; and



Students, 10 per cent off.



The corporation has also taken steps in this new structure to

recognize STC's social commitment to the province by announcing a

Frequent Rider Program. For $20 a year, Seniors and students

(eight years and up) can purchase a frequent rider pass, which

will afford them a further discount of 20 per cent on each trip.



As well, STC has lowered the cost of a monthly pass for medical

users to $53.95 from $59.95, and we have lowered the age to

qualify for a senior discount from 65 to 60.



The implementation of the discount structure will mean a general

fare increase, the amount of which will depend on the individual

trip. For an average trip of 185 kilometres (115 miles), it will

mean an increase of about 15 per cent. Specifically, for a

one-way, adult fare from Regina to Saskatoon, it will mean an

increase of about $4.



In 1996, during the Crown review, we found STC's fares were 25

to 30 per cent below the Western Canadian industry average,"

Hadfield said.



"Since that time, other carriers have increased their rates while

STC has not, so it will be even further behind today.



"Before entertaining the idea of a fare increase, STC first made

sure it had its own financial house in order. Over an 18-month

period, the company cut administration costs by 43 per cent, and

operating costs by 15 per cent, for an overall decrease in

corporate expenses of more than 24 per cent.



"As well, we have decreased our operating deficit from more than

$8 million in 1997 to a projected $2 million in 1999, the lowest

deficit in more than 15 years.



"This restructuring will only gain about $500,000 a year in

additional revenue, or less than $2 per year per user, but it

will go a long way to preparing the company for a competitive,

deregulated marketplace," Hadfield concluded.



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NOTE: STC's passenger rates are not subject to the 45-day rate

review, as they are currently regulated by the Highway Traffic

Board, a quasi-judicial body. The Highway Traffic Board has

approved the new rates, as they fall below the maximum amounts

already approved for motor coach operators in the province.





For more information, contact:



John Millar

STC

Regina

Phone: (306) 787-6807