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Regional Transportation Funding Problems Keep Getting Bigger

In a sobering revision of the 25-year Regional Transportation Plan (RTP) at yesterday's Metropolitan Transportation Commission (MTC) meeting, MTC staff explained that the elimination of the State Transit Assistance (STA) fund and much lower than expected sales-tax revenues forced the planning body to significantly revise down its projections for operational spending and expansion projects (PDF). The MTC revised down expected revenues by $8 billion (even despite over $3 billion in expected stimulus funds) and announced that BART's
extension to San Jose is running a cool $1.5 billion over budget.

Most operators anticipated the crunch brought on by the elimination of the STA fund and have adjusted as best as possible, with AC Transit already raising fares and the MTA discussing a fare hike, service cuts, and additional hiring freezes.   The $4.5 billion in lower sales-tax revenues (TDA
funds in transpo-speak), will make transit operations even more difficult. 

The Valley Transportation Authority (VTA) in Santa
Clara County and SamTrans in San Mateo County will see some of the worst hits proportionate to their size.  The first graph below shows the overall expected operational deficits over 25 years, assuming current conditions with no positive change in STA or TDA funding over that period:

Operating_Shortfall.jpgLight blue is shortfalls for the major operators prior to the new TDA and STA forecasts made available yesterday.  Red is the current expected shortfall, should there be no change to expected revenues.

This graph shows the trends relative to operator size and operating expense:

Op_shortfall_2.jpgLarge operators like the MTA appear better equipped to absorb the blow of decreased revenues

Although this meeting was nothing like the tumultuous affair last month, where nearly 200 bus riders protested the use of $70 million in stimulus funds for the Oakland Airport Connector, MTC spokesperson John Goodwin said he had never seen such a marked tightening of expected transportation revenue since he'd been at the commission.   "These are new numbers just since December and reflect some very difficult challenges we face," he said.

MTC staff acknowledged that the perennial operating deficits and funding problems could not be ameliorated within the scope of a 25-year plan, but needed a bold new plan in the near term.  In addition to advocating for steady funding from the state and federal levels, MTC staff called for a comprehensive new study across every transit operator's jurisdiction to improve productivity from existing capacity before raising fares or cutting service.  Referring to the MTA's Transit Effectiveness Project as a model, MTC staff asked its commissioners to consider authorizing such an expansive study at their meeting in April.

When asked how much such a study would cost, MTC Executive Director Steve Heminger refused to give details.  "We need to scope the study first.  I'll give you that answer in April," he said.

Advocates seemed to support an inter-agency study to squeeze as much productivity as possible from existing operations, while eliminating redundant services, but urged caution, keeping in mind the sensitivity of transit riders. 

Carli Paine of TransForm applauded the notion that MTC would advocate for federal and state operatining funding and argued fare increases should only be a last resort.  "We need to be careful to look at raising fares for new revenue as a deterrent to riding transit," she said.  She also reminded commissioners that while the TEP is a good model on how to increase efficiency, there are still major concerns for how MTA will pay for implementing the TEP's recommendations.

Berkeley Mayor Tom Bates was the only commissioner to give guidance to staff on how the study should be conducted, requesting they analyze dynamic car-share programs and transit-oriented-development in conjunction with transit efficiency. 

Public comments on the proposed revisions will be taken by the MTC until April 8th.  Readers can send comments via mail to 101 Eighth Street, Oakland, CA 94607, Attn: Public Information; via E-mail to; or via fax to 510.817.5848, Attn: Public Information.

For a more detailed analysis of regional funding challenges, see today's excellent report on Transbay Blog.

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