Metro ridership, revenues declining

According to this presentation before Metro’s finance committee this week, the June 23 red line accident, lower gas prices and a declining economy have all contributed to lower ridership on Metrorail and Metrobus than originally anticipated.

Except for Metroaccess, which has very rapid ridership growth, system revenues are much below the anticipated levels, and are even below last year’s revenues for the same two-month period. Rail revenues are 6 percent below budget, and bus is 12 percent below budget. So far, the system is $8.2M behind, and Metro forecasts being behind by $22M by the end of the fiscal year (June 2010). For perspective, last year’s final budget gap which led to proposed service cuts was about $30M.

Part of the anticipated shortfall is due to an assumption for the revenue increase from eliminating paper transfers for bus. Metro staff originally proposed a $5M revenue gain, but at Board request, the budget reflected a $10M gain. Metro now estimates a gain of $6.8M.

If Metro ends up at the end of a budget year with a surplus, part of the surplus gets saved in an operating reserve fund and other reserve funds. Anything in excess of that is returned to the funding jurisdictions by reducing the required subsidy. I’m not sure what happens for the opposite case. It’s pretty unlikely that the funding jurisdictions are going to be able to come up with millions of unbudgeted dollars in the middle of the year, so this could mean more deferred maintenance or a reduction in discretionary spending, if Metro has any left at this point. Their last alternative would be emergency fare increases or service cuts, which would have to have public hearings and Board approval.