Bacon's Rebellion

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Danger, Will Robinson: Metro Traffic Projected to Decline

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by

James A. Bacon
in

Metro station at Ronald Reagan Washington National Airport

The Washington Metropolitan Area Transit Authority (WMATA)  is projecting a decline in ridership of as much as 5% in the next budget year. If Congress fails to extend Stimulus Act subsidies for federal employees, reports the Washington Examiner, ridership could dip another 2.8%.

An WMATA spokesman blames a switch to manually operated trains in the wake of the deadly Fort Totten crash in 2009, which has slowed service. Furthermore, extensive track work has led to delays and closed stations. A maintenance backlog also has resulted in broken or rehabbed escalators. And don’t forget the impact of a fare increase and prolonged unemployment. It all adds up to a projected loss of $12 million in rail revenue — $28 million if the federally funded transit subsidy expires.

In related news, WMATA’s budget forecasts indicate that the opening of Phase 1 of the Rail-to-Dulles project could run three months late, with a start date of Spring 2014, and that ridership will amount to 14.4 million in the first year — down from the official forecast of 15.3 million. So reports the Examiner.

So, how much will Metro rail subsidies cost the commonwealth and its participating jurisdictions? According to Metro’s 2012 Budget Book, in FY 2012, Metro rail will require $149 million in operating subsidies. Virginia jurisdictions’ share will be $37.4 million. Plus, Virginia state and local governments will cough up an extra $110.2 million for capital improvements. (Fairfax County’s contribution should swell when Phase 1 of Rail-to-Dulles comes on line.)

Here’s my worry: Metro Rail is a critical part of the metropolitan Washington transportation infrastructure but it relies heavily upon local government funding to cover operating expenses and capital maintenance. What happens if the federal government actually starts cutting spending (as opposed to pushing spending cuts into the indefinite future), workers get laid off, contracting work dries up and local tax revenues decline? Will the WMATA board curtail capital expenditures to alleviate local governments’ fiscal pain? If so, will maintenance suffer? If it does, will that hurt ridership? Will declining ridership bite into revenues, all in a vicious cycle?

I’m not sure we have a fiscal formula that’s sustainable through the hard times that are bound to come. But we’re doubling down with the commitment to Rail to Dulles. I’m getting the heebie-jeebies just thinking about it.

— JAB

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23 responses to “Danger, Will Robinson: Metro Traffic Projected to Decline”

  1. Groveton Avatar
    Groveton

    “What happens if the federal government actually starts cutting spending (as opposed to pushing spending cuts into the indefinite future), workers get laid off, contracting work dries up and local tax revenues decline?”.

    Metro will be the least of Virginia’s problems when (not if) this situation occurs.

    The surplus tax dollars that come from NoVa and Tidewater will slow to a trickle. That alone will force the state to cut budgets which will hurt the Richmond area. Unemployment will rise and people will leave NoVa in droves, they will leave Tidewater in quantity and some will leave Richmond. The over-supply of housing relative to buyers will crater the housing market in NoVa, hurt it significantly in Tidewater and cause a decline in Richmond. Local real estate taxes will fall. The state education funding formula will result in reduced payments from the state to Virginia’s less affluent rural, small town and downtown localities. These areas will see an increase in crime and other societal problems causing existing employers to leave and potential employers to stay away.

    All because the Clown Show never had the intellect or discipline to focus policy on economic growth. This now inevitable fiasco could have been almost completely avoided had the Clown Show chosen to act over the last 20 years.

    The only faint hope is for immediate home rule for Virginia’s three economic engines – NoVa, Tidewater and Richmond. These regions may be able to salvage some level of job retention if they are free to pursue policies applicable to their region without suffering under the yoke of the Clown Show.

    However, as I said, Rail to Dulles will be among the least of our problems.

  2. James A. Bacon Avatar
    James A. Bacon

    Oh, I agree, the Metro will be only one of many, many problems in Virginia when Uncle Sam gets serious about budget cutting. I have done my best to highlight the dangers in previous posts. But the last thing you want when the economy and budget is going all to hell is for a critical piece of transportation infrastructure to start swirling down the toilet, too. Degradation of critical economic components like Metro will just make matters worse.

  3. larryg Avatar
    larryg

    METRO money comes from the Fed gas tax and we are spending roughly twice as much as the gas tax actually generates.

    There is sentiment that whatever we spend on transportation should not exceed what we bring in – in gas taxes and if we did that – about 1/2 of the transportation funding would be cut.

    so we’ll end up with no road construction money and likely will have much transit de-funded.

    All of these local transit systems that are currently subsidized by the Feds are going to be cut lose for the localities to decide if they want to fund them or not.

    In our own case – we have a fleet of small-town transit buses which charge – 25 cents per boarding….

    I think cuts to transportation funding are separate and a lot more of a near-term decision than other govt funding.

    Hey.. I just want to point out here that the “deficit” for transportation is about 30 billion dollars… out of a budget deficit of 1.5 Trillion.. and please note that the massive Social Security program – also in deficit – in the same range…. 30-60 billion ( and much of that because of the 2% FICA tax “stimulus” reduction).

    I’m not sure how they decide how much METRO can charge at the farebox…. much like I’m not sure how an investor-grade toll road study determines the optimal toll price…… but If METRO fares doubled ( which I think would make their self-supporting)…. what would be the impact of that ?

    people won’t flock to their cars necessarily with the advent of HOT Lane tolls… so what would actually happen?

    what I suspect is that low income people who ride metro will have to eat the increase.

    what I also think is interesting is that the Federal Govt not only subsidies METRO directly but they subsidize the govt workers a second time.

    no one subsidizes the low income riders…

  4. TMT Avatar
    TMT

    Metro’s biggest losers are not rail, but rather, Metrobus and MetroAccess, the service for disabled people. The fare box covers more rail costs than bus costs. WMATA views buses as a social program. It also provides services for disabled people at levels well beyond what is required by law. WMATA lacks good management controls, has employee compensation plans that exceed what most private and government sector employees receive, and regularly settles claims for injuries at above-average rates. It’s a big, sucking money pit.

  5. larryg Avatar
    larryg

    the Federal gas tax views transit as for what they term “underserved” populations and the strings that come with the money require serving those who need accommodations….

    this works a lot like the Federal educations dollars that are directed at at-risk kids.

    Both of these programs were initiated when it was observed that localities would not fund either service so the Feds got involved in it.

    The money requires a local match…

    come to think of it.. this works just like MedicAid. The Feds provide funds but the state must match – and they must offer MedicAid to the groups that the Feds think are underserved.

    If Congress axes transportation money to 1/2 it’s current level – all transit, everywhere is going to be severely cut and the ball will fall into locals laps.. as to whether or not they wish to continue the service.

  6. TMT Avatar
    TMT

    Transit is important, both locally in the D.C. metro and nationally. Transit can aid those without personal vehicles get where they need to go and also provide transportation options for people otherwise driving cars. Transit can reduce traffic congestion. Transit can also permit walkable, mixed use communities to be built and prosper.
    But transit can be expensive, especially as it is so often “over-sized” for the locations affected. Heavy rail is built when Bus Rapid Transit might be a better solution. Big buses are used when small buses, vans or jitney vehicles might better fit. Etc.
    One of the most positive things done by the Obama administration is the FTA’s questioning of heavy rail (e.g., Metrorail-style transit). Transit needs to be focused on moving large numbers of people efficiently, effectively and safely. While it will deliver some value, the Silver Line does not pass this test. Neither does Metrobus or MetroAccess pass the test.

  7. larryg Avatar
    larryg

    transit can be useful – yes – but why are people in Kansas paying for NoVa’s Metro?

  8. TMT Avatar
    TMT

    There are two arguments in favor of federal support of Metrorail. One is a huge number of federal employees take rail. But I doubt ridership on the Silver Line will be the same. Two is Uncle Sam needs to be involved in everything. I don’t think people from Kansas should be paying for Dulles Rail. Transit is a local and/or state responsibility. Uncle Sam should get out of the road business too, with the possible exception of the interstate highway system.

  9. larryg Avatar
    larryg

    I doubt the farmer in Kansas is going to think good thoughts about him subsidizing a govt worker when we are 1.5 trillion in deficit….

    Groveton keeps talking about home rule. Others keep talking about the need for more local transparency and accountability for decisions on how infrastructure decisions are made.

    the question is – why does NoVa expect the state and the feds to pay for NoVa transit instead of the people who live and work in NoVa?

    actually – you could replace “transit’ with transportation/mobility infrastructure.

    I’m not advocating balkanization but at what point do we say that NoVa is no more responsible for the transit systems in Roanoke or Charlottesville and vice-versa?

  10. TMT Avatar
    TMT

    Larry, I am not arguing what I believe now, rather, what some of the arguments are. One argument is that, since the Commonwealth is in charge of the roads, it has the obligation to build and expand roads here. Building on that argument, state transportation money invested in NoVA projects can provide a greater return in terms of safety, traffic congestion reduction and economic benefit than investments in other parts of the state.

  11. larryg Avatar
    larryg

    given the fact that the Commonwealth is funded by taxpayers via their gas tax…. why should NoVa expect more than what they’d generate?

    I think the purpose of the State and Feds in collecting gas taxes is to involve themselves in uniform standards, processes, procedures, etc for construction, operation and maintenance (by controlling the purse strings) but why should any locality expect more back than what they put in and if NoVa expects it from RoVa why would RoVa not expect the reverse?

    Every locality – ALWAYS has the option to “top off” whatever they get back…. with local option taxing… but expecting taxpayers in other jurisdiction to pay for your “more important needs” is … well.. it’s funny.

    Hampton Roads rails all the time about how NoVa is sucking up more than it’s share of funds and I’ve heard the same complaint from Roanoke, Charlottesville, etc…

    all of them think they are getting screwed and want their money .. and if they get lucky.. more than what they paid originally.

    and… it works….. just look at Charlottesville… 200 million for a new road, eh?

  12. Hydra Avatar
    Hydra

    There is sentiment that whatever we spend on transportation should not exceed what we bring in –in gas taxes and if we did that –about 1/2 of the transportation funding would be cut.
    +++++++++++
    Or you could double the gas tax in order to reset it to 1987 levels.

  13. larryg Avatar
    larryg

    I’m not sure if you intended it but that’s the actual situation right now.

    we are currently spending, at the Federal level about twice what the gas tax brings in – and there is fairly strong sentiment, perhaps even with some level of bipartisan agreement that spending needs to go back to what the tax brings in.

    if that actually happens – the long knives are going to first go after the 3 cents that is currently dedicated to transit.

  14. Hydra Avatar
    Hydra

    Lets see, metro is in trouble because the feds will no longer subsidize the farebox portion of a ticket that is already subsidized?

    We should either close it down or make it free.

  15. Hydra Avatar
    Hydra

    perhaps even with some level of bipartisan agreement that spending needs to go back to what the tax brings in.

    ==============================================

    If that happens, in 20 years the roads will deteriorate to nothing and we will be back to traveling by horseback.

  16. Hydra Avatar
    Hydra

    perhaps even with some level of bipartisan agreement that spending needs to go back to what the tax brings in.

    ==============================================

    If that happens, in 20 years the roads will deteriorate to nothing and we will be back to traveling by horseback.

  17. TMT Avatar
    TMT

    VDOT should collect part of the gas tax to fund roads of statewide significance, i.e., those roads with substantial inter-county/city traffic. Control of all other roads should be devolved to local jurisdictions, with each locality keeping the remainder of the gas tax that is collected in each jurisdiction. So long as state and federal standards are maintained, each locality should be free to decide how to spend its revenues. Other tax revenues dedicated to transportation, chiefly for paying off bonds, should be kept as is.

  18. larryg Avatar
    larryg

    you’d already know this if you knew how much Fairfax generated in gas tax revenues and how much VDOT delivered to Fairfax in maintenance, operations and road improvements.

    the concern is that devolution will pay you less than what you get right now in ops, maint, improvements.

    you don’t need a statewide gas tax increase to find this out.

    it ought to be a priority for Fairfax govt to find out and provide the info to it’s citizens as a first step towards taking over their local roads.

    the separation between development and transportation consequences needs to disappear and be part of any county process where development is proposed – and the elected govt of Fairfax needs to be able to be held accountable for such decisions as well as the downstream transportation and tax consequences of those decisions.

    We blame Richmond – but when the option is give to be responsible for our own destiny – we keep saying that Richmond “owes” us money -money it does not have to start with.

    so one has to ask – is Fairfax really serious about taking responsibility for transportation in it’s county or does it still want to retain VDOT and the clown show as handy whipping boys…??

  19. TMT Avatar
    TMT

    “is Fairfax really serious about taking responsibility for transportation in it’s county or does it still want to retain VDOT and the clown show as handy whipping boys…??” I don’t think the Fairfax County BoS would be willing to accept control of all local roads in the county. Such a transfer of control would not affect all streets and highways. VDOT would still have significant responsibility. But the residents of Fairfax County would look primarily to their supervisors for transportation responsibility. I don’t think we have ten Harry Trumans on the board. It’s easier to blame Richmond.

  20. larryg Avatar
    larryg

    It seems to work for Alexandria, Henrico, and all the towns and cities in Va that also have VDOT-controlled primary roads not to mention 46 other states.

  21. TMT Avatar
    TMT

    Read the article in today’s WaPo about the trips (junkets) and incorrect expense accounts from MWAA board members. http://www.washingtonpost.com/local/travel-records-in-disarray-for-authority-overseeing-reagan-and-dulles-airports/2011/10/17/gIQA8v6WqM_story.html
    Dana Hedgpeth does a pretty good job on this one. These are the same clowns who are overseeing the Silver Line’s construction. They wanted the underground station at the Airport, but didn’t want to pay for it. They forced a project labor agreement on Phase II of the project. And liberals wonder why conservatives are so adamant against more spending and higher taxes.

  22. larryg Avatar
    larryg

    it was not “liberals” who doubled the DOD budget … created a 1.5 trillion structural deficit and doubled our debt from 5 trillion to 10 trillion.

    these were self-avowed fiscal conservatives who said that we “had no choice” since we were attacked by terrorists and that ‘deficits don’t matter’.

    blaming “liberals” when those who claim to be fiscal conservatives are doing the same thing … does not deal with the realities in my view.

    if true fiscal conservatives were in charge when we had to respond to terrorist attacks.. they would not have insisted that we pay for the things we had to do … rather than …. say we “had no choice” and then on top of that cut taxes.

    the biggest problem we have now days in my view is that we want to “blame” …. liberals for our spending woes but the record shows that those who traditionally claimed fiscal conservatism were no better.. and probably worse.

    Then after they blow up our budget – they say we have a “spending” problem but won’t say what to cut other than entitlements – and ..refuse to cut the DOD budget that they doubled ….

    so now days, the folks who claim they are fiscal conservatives spend their time blaming others instead of what they used to do – show leadership.

  23. larryg Avatar
    larryg

    after reading the WaPo article, I am even more unimpressed. Stories like this are written every year .. under every administration … Federal and State and even local…

    it’s not that this kind of thing should be accepted as “ok” and I’m all for investigative reporting to root it out whenever and wherever and burning the butts of whoever was doing it….

    …. but to attribute this kind of thing to “liberals” is sorta like saying govt itself is due to “liberals”.

    I know it’s in vogue these days but … geeze…..

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