Greater Greater Washington

Budget


What is WMATA's long-range financial plan?

The Washington Post, several bloggers, and many Metro riders have been hammering WMATA recently for being so opaque about its timetable for Metro Forward repairs. Besides leveling with riders about how long repairs are going to take, WMATA could build confidence by also being more forthcoming about how much money it will need in the long run.


Photo by Paul L on Flickr.

The constant refrain from CEO Richard Sarles about maintenance is, "it'll be done when it's done." As Dan Malouff wrote yesterday, that isn't good enough. "The more confident we are that this painful time will end someday, the better we can support Metro in the meantime," he said.

The same questions apply to WMATA's budget. Year after year, we find out that there's a shortfall, or maybe not; a fare hike has to go into effect, or maybe not. The budget precipitates a crisis where local jurisdictions have to come up with money or service cuts have to take effect.

Last April, I suggested a long-range financial and capital plan for Metro with specific information:

  • Until 20XX, Metro will be in "catch-up mode." After that, they'll be in "keep it working" mode.
  • During catch-up mode, Metro needs $x million in capital funds per year, increasing at a rate of x% per year. After that, they'll need $y million in keep it working mode (less than in catch-up mode).
  • If we can still afford the catch-up mode funding once Metro reaches a state of good repair, then we can start using the surplus to pay for some projects to deal with the high passenger loads that there will be by this time, like adding physical walkways between Metro Center and Gallery Place, new entrances at busy stations like Foggy Bottom, or new lines or tracks in the core.
  • If Metro doesn't get enough money in catch-up mode, then that mode will have to last longer. If it doesn't get enough in keep it working mode, then it may have to go back into catch-up mode.
  • In keep it working mode, to maintain the existing service, given wages, pensions, fuel, health care, and so on, Metro will have to increase its budget by z% each year. A certain percentage of that can come from riders, while jurisdictions should plan on increasing their Metro contributions by the remaining amount necessary to reach the z% per year.
  • In good years, Metro will use the extra money to top up its rainy day fund; in bad years, it'll spend money from that fund.
From talking to some WMATA employees, my understanding is that many but not all top leaders want to be able to project like this. Some of the information about asset lifecycles they have, while some they hope to collect. It's less clear how much consensus there is over how deeply to share the information with the public.
Along with revealing how much money the agency needs, there needs to be transparency about what we get for it. If the region keeps up funding maintenance, then we need to be able to know that, indeed, the system is maintaining a state of good repair. It's a two-way street: a good system will cost this much, but then residents can know they got a good system out of the deal.

More long-term budget information will also help leaders and riders know whether the pension obligations and other retirement benefits are unsustainable over the long run. If they are, we need to start finding ways now to keep paying good workers a living wage and ensuring they have health care, but with a package that WMATA and the region can keep affording for decades to come.

Without long-term budgeting, it's always too easy to shortchange the present. It's easy to skip out on keeping up state of good repair during an economic downturn, and then not make up the funds during a boom. Before 2008, WMATA's pension funds rose in value, so the agency didn't salt as much money away; that ultimately let jurisdictions spend less. Then, the funds dropped, and it had to come up with more money during the toughest times.

It's always easier to get through the immediate problems and push the long-term questions out of mind until they're imminent crises. Certainly that's what we do with road projects, tooas Strong Towns' Chuck Marohn keeps chronicling, few jurisdictions really plan for the lifecycle replacement costs of the new road infrastructure from a new subdivision. Someone else will deal with it later.

Metro took a big step forward by releasing its long-term vision for capital projects, like upgrading to 8-car trains and relieving the Rosslyn bottleneck. Now we know how much those should cost, and local governments can start thinking about how to pay for it. Now, we need the equivalent for the Metro Forward maintenance plan and the operating costs for all services. We need better data to make fully informed decisions.

The Metrorail system is one of our region's greatest assets. We have to keep it working for the long term. Riders need confidence that we will get past the immediate problems and avoid getting into this kind of hole again. Otherwise, even if Metro does regain rider confidence, it'll always be on the precipice of more crises that squander it again.

David Alpert is the Founder and Editor-in-Chief of Greater Greater Washington and Greater Greater Education. He worked as a Product Manager for Google for six years and has lived in the Boston, San Francisco, and New York metro areas in addition to Washington, DC. He loves the area which is, in many ways, greater than those others, and wants to see it become even greater. 

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Barring new leadership at WMATA, I don't see this happening. The current crop of "leadership" has repeatedly shown they have no interest in holding themselves accountable for anything, whether it is rider safety, escalator repairs, or communication during emergencies. Unfortunately I think it will take another disaster like the 2009 Red Line crash to force the appropriate regulators and public officials to wake up and demand change.

by Rebecca on Jun 12, 2013 12:38 pm • linkreport

Fares/finances are probably a bigger problem than the extensive work when it comes to driving down ridership. Not that they're necessarily exclusive of one another. But the silence coming from WMATA this week in response to the Post article is deafening (and telling of the do nothing culture that exists there).

by aaa on Jun 12, 2013 12:49 pm • linkreport

Unfortunately I think it will take another disaster like the 2009 Red Line crash to force the appropriate regulators and public officials to wake up and demand change.

Unfortunately since then we've seen multiple derailments, debilitating delays, even a fire, and WMATA is still asleep.

by Scoot on Jun 12, 2013 1:18 pm • linkreport

Bravo! Great article.

Now how do we the riders get WMATA to sit up and pay attention to these demands? Who has the power to make these things happen, and what motivates them? Methinks the answer lies somewhere between public shaming and the almighty dollar.

Metro can be a great system again. But the only people who are going to hold the board's feet to the fire and make that happen are us.

by Kristen on Jun 12, 2013 1:37 pm • linkreport

WMATA will always find it difficult to plan for the future as long as the current funding structure is in place. As long as the jurisdictions are in the driver's seat, there is going to be ambiguity about what WMATA will be able to squeeze out of them in the future.

WMATA should be more open about what it needs, but at the same time it has to balance what it needs with what the jurisdictions are willing and able to provide. They walk more of a political tightrope than I think most of us appreciate.

by Ben on Jun 12, 2013 1:55 pm • linkreport

Bravo: right on point. WMATA management needs to be open about this. Budget projections are hard. Then again, this is one of the main jobs of management: setting goals, establishing budgets, and getting them done. This is Sarles job. If he can't do it, then he needs to go.

by SJE on Jun 12, 2013 2:03 pm • linkreport

Do we know how frequently top leadership outside of the CEO and Board turns over? Granted, over the decades many board members have seemed utterly disinterested and fail to execute the leadership desperately needed, regardless of how often they're replaced. But Metro seems to have a firmly entrenced culture of not giving a hoot about much of anything, and I suspect that is the result of top leadership engaging in petty turf wars and fighting to protect their own little fiefdoms, all with the wink and nod of multiple CEOs who aren't interested in making the really difficult decisions required to clean house and make changes.

by Birdie on Jun 12, 2013 2:04 pm • linkreport

Thank you for this article, David. I completely agree. I'm not sure how much harder WMATA leadership can be slapped than what we've seen from every angle this week - including your coverage here on GGWash.

We have to ask though - what if this wake-up call is met with a strong slam on the snooze button?

Do we try to oust the WMATA Board of Directors (an effort I've started)? Do we call for WMATA upper management to be fired? What do we do? What CAN we do?

Many people who rely on WMATA can't boycott it - it's just not an option. If we jump fare gates we get arrested. Nobody wants to show up to meetings in the middle of the day - and why should they have to?

What's next?

I know we've had our difference of opinion in the past but I'm willing to work with you or ANYBODY that has a plan of action here.

Chris

by FixWMATA on Jun 12, 2013 2:06 pm • linkreport

Good article. Hopefully we'll start to see more action from local jurisdictions who rely on Metro service provided by WMATA on this matter.

The leadership of WMATA needs to have their feet held to the fire. The extent of poor service, especially on the weekend, and the amount of maintenance closures that are seemingly endless are unacceptable for the Metro rail system.

by Fitz on Jun 12, 2013 2:16 pm • linkreport

Chris/FixWMATA: I think of WMATA as a cancer, and the solution is surgery, and therapy.

On the surgery side, work needs to be done to help people find workable alternatives in the short- to medium-term. An immediate thing (one which I advocated on Unsuck and was shot down by some angry commenters) is developing a site that provides workable alternatives. DC has a history of DIY mass transit in the form of the slug lines. Surely we can do better and push this concept of DIY mass transit further by finding other, transport and non-transport, alternatives?

In parallel (on the therapy side), lobby everyone with power over WMATA to stop shirking their responsibilities and to enable the alternatives above. On the WMATA side, I agree with your effort, but move upstream: the pressure should be on those people who appoint the members as well. On the alternatives side, as an example, it's time that Fairfax, ArlCo and VA State police start checking for violators of I66's HOV rule every day, every car.

And we keep it up until WMATA either collapses and reforms in a more responsive entity or they change and meet the needs of their riders.

by Alternatives on Jun 12, 2013 2:23 pm • linkreport

There is no way way to measure or create accountability under "it'll be done when it's done" situation. This statement by Sarles exemplifies the lack of accountability throughout WMATA. If this is happening at the CEO level then just imagine how bad things are lower in the organization.

by Jim on Jun 12, 2013 2:24 pm • linkreport

sarles answers to the wmata board, right? so isn't the path forward here to apply pressure to the board? get THEM to demand this information.

theyre politicians. they care about constituent outcry.

by Ballston Guy on Jun 12, 2013 2:41 pm • linkreport

Here's an idea I think the GGW crew can agree with: eliminating the parking garage at Metro Headquarters. Since there is no accountability as to getting this work done in a timely manner, as long as upper management continues to have their leisurely drives to work in their take home cars provided by Metro. Instead, maybe they will find motivation to come up with a plan to get things done if they are getting stuck on the red line everyday, dealing with rude station managers, poor communication during delays, etc.

by FireDrGridlock on Jun 12, 2013 2:50 pm • linkreport

what does it matter if they set dates or not? if it's not met ,they'll just keep pushing it back like they do w/escalators and elevator "repairs"

by teddy on Jun 12, 2013 3:10 pm • linkreport

teddy: because if they set a specific metric (time, cost, etc) then we have something to judge performance. If its due on X, and its late, we can ask why. The current system lets the CEO do whatever he wants.

by SJE on Jun 12, 2013 3:55 pm • linkreport

One caution I would advise is that when it comes time to negotiate wages and benefits with unions, the presence of a WMATA rainy day fund could be used as leverage to argue for higher wages and benefits because WMATA can "afford it". After that, the rainy day fund disappears.

In my mind, rainy day funds should not be seen as leverage for determining how much to pay. Instead, WMATA should look into how hard positions are to fill at current wage levels, and what wage levels are for similarly skilled and qualified jobs in the region and in other urban areas.

by Michael Perkins on Jun 12, 2013 3:56 pm • linkreport

sarles answers to the wmata board, right? so isn't the path forward here to apply pressure to the board? get THEM to demand this information.

theyre politicians. they care about constituent outcry.

most of the board isn't politicans, they're appointed by politicans. And one politician I can think of on the board is Muriel Bowser--who will probably tell you to knock off if you're not a Ward 4 resident, and who has never given me the impression she cares all that much about public transit.

it's a very Balkanized board. Which means they can easily and effcetively ignore the very population that uses their service. Really quite remarkable.

by Birdie on Jun 12, 2013 4:15 pm • linkreport

The issues are greater than WMATA as I have argued for a long time (since the crash, for sure). It's a metropolitan-scale problem requiring a "reset" of the compact and consensus guiding the Metrosystem.

http://urbanplacesandspaces.blogspot.com/2009/11/st-louis-regional-transit-planning.html

http://urbanplacesandspaces.blogspot.com/2011/01/without-right-transportation-planning.html

Ideally it means a metropolitan scale planning initiative and a rebuilding trust initiative. The Momentum plan was just a wee bit of what is needed. Even though, now that I realize it, they seem to be using the same St. Louis model that I discussed in 2009.

by Richard Layman on Jun 12, 2013 4:33 pm • linkreport

There is a similar issue unfolding in the charges that DC Water will have to impose to pay for its obligations to reduce nitrogen departing Blue Plains from previously acceptable levels to much more stringent standards and to create and operate massive tunnels to store storm water that now "overflows" into the Potomac, Anacostia and Rock Creek in heavier rain events.

By 2021, these costs may wall exceed the fees charged now for water and sewer based on how much water the meter measures; a particularly heavy cost is for areas of impervious surface on private property, ignoring the areas of highway where some of the waste includes brake dust and other pollutants not found so much on roof tops. In DC, about half the impervious surface is roads and sidewalks, but rights of way are not in the equation explicitly. Accounts of most residential "customers" could face total charges that make today's look like a grand bargain. And those customers that are in lower income brackets will find the increase staggering and potentially devastating.

by Lindsley Williams on Jun 12, 2013 6:14 pm • linkreport

Such a plan would require WMATA to have a vision. And DC does not do visions, so neither does WMATA. We just stumble from crisis to crisis and pat each other on the back for averting a crisis.

by Jasper on Jun 12, 2013 9:33 pm • linkreport

Excellent article. Sadly, I feel like the current state of affairs in regards to metro communication is an epic failure. Marketing professionals could write books on the failures.

That being said, the ride on the rails has been smoother lately. Clearly, track work is improving some. So tout it!

by h st ll on Jun 12, 2013 11:12 pm • linkreport

Sarles, and much of WMATA's management are new.

I'm not sure what everyone hopes to accomplish by firing the CEO (again).

I think Richard Layman's correct, in that WMATA's problems are largely symptomatic of the fact that the individual jurisdictions no longer any interest in coordinating their planning as a region.

DC, Maryland, and VA all have the right and ability to demand better transparency from WMATA. Unfortunately, it's far more convenient to score political points by complaining about Metro's problems than it is to actually do something to fix them.

Metro's got problems, and we need to start talking about solutions, rather than re-stating the problems. A good place to start would be to outline what is, and isn't possible. ("Fire everyone," and other similar hand-waving gestures being in the latter category)

by andrew on Jun 13, 2013 10:44 am • linkreport

@Jasper And DC does not do visions, so neither does WMATA.

Brilliant. Perfect.

That really is the encapsulation of the current mindset at WMATA and across the region. We're talking about signal timings and mixed-traffic street cars (and dismissing bus lanes as an impossible fantasy) when we need to get real and discuss multiple wholly new heavy rail lines, dedicated rights-of-way for all transit, an end to interlining entirely, and rethinking the system as a whole for the 21st century.

Half-measures won't cut it any longer, and yet we can't even seem to get those done.

by MetroDerp on Jun 13, 2013 12:32 pm • linkreport

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