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04.08.2009 3:04 pm

Metro CEO presses case in Missouri House for $35 million

St. Louis Post-Dispatch
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Baer

Baer

JEFFERSON CITY – Calling the cuts to St. Louis public transportation a “crisis,” Metro transit CEO Bob Baer pleaded his case to a Missouri House committee Wednesday for $35 million in emergency funding.

For the past month, Baer has been quietly working the halls of the Capitol, trying to drum up support for a proposal that the Legislature dedicate $35 million in federal stimulus money to balance Metro’s books and reverse the massive cuts in service that went into effect last month.

Now he and other public transportation advocates are putting on the full-court press. On Tuesday, Baer appeared along with Bob Kohler, the director of transportation for Kansas City’s mass transit system, and asked the House to consider emergency funding for both cities.

“This is a crisis,” Baer said. “There are people who can’t get to work. Any number of people are going to lose their jobs because of our cuts in service.”
Metro faces an operating deficit of about $45 million this year, and on March 30 started implementing cuts that will reduce its service area by about a third and staff by about 25 percent.

Baer is banking on the fact that the Republicans who control the Legislature have been talking about using stimulus funds for one-time uses that save or produce jobs.

“The connection between the economy, tourism and transit is inextricably linked,” Baer said.

While the St. Louis public transportation system is asking for $35 million for one year, Kohler is requesting $14 million for the Kansas City mass transit system. He said the funding would stem cuts for two years.

Baer said his hope is that St. Louis County will put a sales tax measure on the ballot next April similar to the one that failed earlier this year. He told House members he believed that with a better campaign the measure would pass this time.

“I believe that if it were on the ballot yesterday, it would pass,” Baer said. “People now understand that we were serious about the cuts.”

Rep. Charlie Schlottach, R-Owensville, told Baer that getting the Legislature behind the funding request would be an uphill battle. Schlottach is the chairman of the committee that heard from Baer on Wednesday.

“It won’t be an easy task,” he said.

Baer and Kohler said the two largest Missouri cities are supportive of each others’ requests for emergency funding.

Kansas City’s transit system first made its request in a letter to House budget chairman Allen Icet, R-Wildwood, last week.

Baer provided the House with letters supporting the $35 million request from Civic Progress, the St. Louis Cardinals, the Regional Chamber and Growth Association and other business and government officials.

36 comments

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If our local taxpayers/voters can’t be convinced to raise their own taxes, why would you expect someone three or ten counties over could be convinced to raise theirs? There simply is no free money. Government taxes its residents to raise money and should spend it on projects that benefit its residents. Public transit is, at best, a regional amenity, not a statewide one, like I-70 or the state park system. It makes about as much sense to tax someone in Hannibal or Cuba or Springfield to pay for the maintenance of Forest Park or Queeney Park as it does to expect them to support Metro. Sure, they may use one of them once every 2 or 10 years, when they actually come to the “big city”, but the vast majority of the users are LOCAL. Sure, it’s great when we can scam/convince the federal or state government to spend money in the city or the county, but let’s face it, they have no more extra money lying around than anyone else does! The sooner we accept that this is truly a local/regional issue, the sooner we’ll either start to get the problem solved or kill off public transit permanently!

— ExRTD
9:51 am April 9th, 2009

Oh yes, transit is just a local issue and only local people should support it. Because the pool of tax dollars the state gets is only used to fund projects or infrastructure for the area immediately around the project. Like that bridge in Tuscumbia - I’m sure the money Missouri is spending on that bridge only came from taxes collected in Tuscumbia, right? Because it’s not like the roads are connected or anything. And the tax dollars generated by having a good business environment in St. Louis - including the ability to get people to and from their jobs - will only be spent in St. Louis, I’m sure. They won’t be going to pay for medical care for elderly people who live way out of “the big city,” right, or to support the state’s university system, or any other “non-local” concern? So why should transit be any different.

— It's a Local Matter
12:03 pm April 9th, 2009

I’m so tired of the charges of “mismanagement” that I can’t read any more without commenting. Since the term is thrown around so easily (and apparently without any factual basis), all I can do is assume there are two threads behind it.
One is the litigation behind the construction of the Shrewsbury MetroLink extension, so let’s start there. In 2000 Metro hired a joint venture to manage the construction of the Shrewsbury Branch with a completion date of May, 2005. In February, 2002 Larry Salci was hired as CEO and reviewed the progress of that construction. Eventually he believed that, at its current pace and cost, it would not be completed on time and would be much further over budget than it eventually proved to be. In August, 2004 Metro terminated that contract, took over direct management of the project. Having terminated the contract, litigation was inevitable and Metro filed suit claiming breach of contract, negligent design, and fraudulent misrepresentation. In order to complete construction Metro requested that the City and County approve the sale of an additional $150 million in bonds (to be repaid over time by Prop M proceeds) to fund the cost overruns in the project prior to Metro’s takeover, and completed the Shrewsbury Branch in August, 2006. The lawsuit was filed specifically to recover those taxpayer funds from the original contractors. That lawsuit, when taken to a jury which spent months poring over complex documents, was ultimately unsuccessful. While we can Monday-morning-quarterback all those decisions, they were based on professional judgments and Mr. Salci and others connected with those decisions are no longer with Metro.
The other thread which seems to underlie the “mismanagement” thread is the fact that Metro is no longer able to spin gold from straw in meeting its expenses with insufficient revenues. Federal operating funding ended in 1999 and was never replaced by Missouri funds or increased local funds. Metro management clearly saw the trends – increasing costs and decreasing revenues – in the late 1990s and began sharing them with the City, the County and the Missouri General Assembly. Instead of responding positively, the County reduced its support and diverted more of the original 1973 sales tax to roads, and the Missouri General Assembly remained silent. The City continued to provide its entire sales tax collections, however, they have not kept pace with inflation. The political leadership of the region also directed Metro to build the Shrewsbury MetroLink extension without providing additional funds to operate it, promising that “if you build it, money will come” – but it didn’t.
So Metro dealt with the issue internally, aggressively managing costs and buying time for the political leadership to act. It froze all wages for two years, and its cost of compensation and benefits has been flat for five years despite the addition of staff for the Shrewsbury MetroLink branch in August, 2006 and the fact that transit is a labor-intensive business. The non-union pension plan was modified as a money-saving measure. All health insurance programs were dramatically changed to require much higher co-pays and deductibles. Workers compensation costs for this labor-intensive operation have been reduced dramatically over the last five years. Metro shifted to competitive contracting of all cleaning, security, and many maintenance functions as well as selling various assets and leasing them back to free up local funds. It restructured many driver relief methods to reduce deadhead miles and hours which then allowed some expansion of bus service after the Shrewsbury MetroLink Branch startup. The reduced deadhead miles and hours (miles and time spent going to the beginning of a line) created a reduction in the net subsidy per passenger boarding for four years in a row. It shifted federal capital funds (intended to buy buses, fix buildings, and make capital rail improvements) into the operation of the bus and rail system (originally a stopgap solution but one that continues to this day) which has meant a deferral of other business infrastructure improvements. It aggressively sought short term and temporary federal funds, and various modifications of the Cross County bonding to defer paying principle to keep some Prop M funds in the operation. Despite all those actions, there was still a 10% service cut in 2001 and four fare increases to prevent more serious impact on customers.
And now there is no more straw to spin. Either the region provides additional funding for transit in some way from some source or it accepts a smaller transit system providing less access to jobs, education, medical facilities. Perhaps it won’t matter to you because you have a job and a car, at least you have one today. And maybe it doesn’t matter because you aren’t disabled or don’t have a disabled family member (although statistics show that the odds of becoming disabled before age 60 are far greater than the odds of dying). And maybe it won’t even affect you today or tomorrow. Maybe you won’t notice it until your daughter or son doesn’t “come home” after college graduation because there aren’t any good-paying jobs in this region any more because national companies bypass contracting, short-sighted areas. I guess we’ll all see, won’t we?

— Garrett
1:14 pm April 9th, 2009

I’m so tired of the charges of “mismanagement” that I can’t read any more without commenting. Since the term is thrown around so easily (and apparently without any factual basis), all I can do is assume there are two threads behind it.
One is the litigation behind the construction of the Shrewsbury MetroLink extension, so let’s start there. In 2000 Metro hired a joint venture to manage the construction of the Shrewsbury Branch with a completion date of May, 2005. In February, 2002 Larry Salci was hired as CEO and reviewed the progress of that construction. Eventually he believed that, at its current pace and cost, it would not be completed on time and would be much further over budget than it eventually proved to be. In August, 2004 Metro terminated that contract, took over direct management of the project. Having terminated the contract, litigation was inevitable and Metro filed suit claiming breach of contract, negligent design, and fraudulent misrepresentation. In order to complete construction Metro requested that the City and County approve the sale of an additional $150 million in bonds (to be repaid over time by Prop M proceeds) to fund the cost overruns in the project prior to Metro’s takeover, and completed the Shrewsbury Branch in August, 2006. The lawsuit was filed specifically to recover those taxpayer funds from the original contractors. That lawsuit, when taken to a jury which spent months poring over complex documents, was ultimately unsuccessful. While we can Monday-morning-quarterback all those decisions, they were based on professional judgments and Mr. Salci and others connected with those decisions are no longer with Metro.
The other thread which seems to underlie the “mismanagement” thread is the fact that Metro is no longer able to spin gold from straw in meeting its expenses with insufficient revenues. Federal operating funding ended in 1999 and was never replaced by Missouri funds or increased local funds. Metro management clearly saw the trends – increasing costs and decreasing revenues – in the late 1990s and began sharing them with the City, the County and the Missouri General Assembly. Instead of responding positively, the County reduced its support and diverted more of the original 1973 sales tax to roads, and the Missouri General Assembly remained silent. The City continued to provide its entire sales tax collections, however, they have not kept pace with inflation. The political leadership of the region also directed Metro to build the Shrewsbury MetroLink extension without providing additional funds to operate it, promising that “if you build it, money will come” – but it didn’t.
So Metro dealt with the issue internally, aggressively managing costs and buying time for the political leadership to act. It froze all wages for two years, and its cost of compensation and benefits has been flat for five years despite the addition of staff for the Shrewsbury MetroLink branch in August, 2006 and the fact that transit is a labor-intensive business. The non-union pension plan was modified as a money-saving measure. All health insurance programs were dramatically changed to require much higher co-pays and deductibles. Workers compensation costs for this labor-intensive operation have been reduced dramatically over the last five years. Metro shifted to competitive contracting of all cleaning, security, and many maintenance functions as well as selling various assets and leasing them back to free up local funds. It restructured many driver relief methods to reduce deadhead miles and hours which then allowed some expansion of bus service after the Shrewsbury MetroLink Branch startup. The reduced deadhead miles and hours (miles and time spent going to the beginning of a line) created a reduction in the net subsidy per passenger boarding for four years in a row. It shifted federal capital funds (intended to buy buses, fix buildings, and make capital rail improvements) into the operation of the bus and rail system (originally a stopgap solution but one that continues to this day) which has meant a deferral of other business infrastructure improvements. It aggressively sought short term and temporary federal funds, and various modifications of the Cross County bonding to defer paying principle to keep some Prop M funds in the operation. Despite all those actions, there was still a 10% service cut in 2001 and four fare increases to prevent more serious impact on customers.
And now there is no more straw to spin. Either the region provides additional funding for transit in some way from some source or it accepts a smaller transit system providing less access to jobs, education, medical facilities. Perhaps it won’t matter to you because you have a job and a car, at least you have one today. And maybe it doesn’t matter because you aren’t disabled or don’t have a disabled family member (although statistics show that the odds of becoming disabled before age 60 are far greater than the odds of dying). And maybe it won’t even affect you today or tomorrow. Maybe you won’t notice it until your daughter or son doesn’t “come home” after college graduation because there aren’t any good-paying jobs in this region any more because national companies bypass contracting, short-sighted areas. I guess we’ll all see, won’t we?

— Garrett
1:16 pm April 9th, 2009

AMEN Garrett!
It’s too bad that all the facts you present won’t make any difference to those who think they know what’s going on. I too am tired of hearing mismanagement being thrown around by those that have no clue as to what is really happening and just jump on someone elses band wagon. WAY TO GIVE THE FACTS!

— C-A-RMech1
2:34 pm April 9th, 2009

Please, oh, please, stop shedding crocodile tears for disabled folks. They have plenty alternative transportation, and they are doing just fine. For the past month I have witnessed a sharp increase in EMT vans’ presence. They effectively replaced Bi-State’s Call-A-Rides. And they are much smaller too.

— Stan
11:36 am May 8th, 2009

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