Metro service may not need to be slashed as much as initially expected
Did King County cry wolf to voters with predictions of 16 percent cuts to bus service? The County Council is now considering ways around the deepest cuts.
Seattle Times transportation reporter
Rod Dembowski’s plan
County Councilmember Rod Dembowski’s proposal was endorsed in committee by members Jane Hague, Kathy Lambert and Pete von Reichbauer; voting no were Dave Upthegrove, Joe McDermott and Larry Philips. Dembowski proposes that:
• Fares pay for at least 30 percent of operating costs. (They cover 29 percent now.)
• Metro Transit costs become equal to or below peer agencies in other major cities.
• An independent audit look at operations, financing and reserves.
• Metro proceed with a cut of 161,000 annual service hours in September but avert 389,000 hours of future cuts, pending further attempts to save money.
Some members of the Metropolitan King County Council are getting cold feet about following through on a proposed 16 percent bus-service cut.
Two competing proposals are in play. Each would proceed with the relatively small reductions planned this September and leave open the possibility of averting or softening three more rounds of cuts in 2015.
A vote is scheduled Monday.
The debate comes not quite seven weeks after voters rejected Proposition 1, which would have enacted a $60 car-tab fee and a 0.1 percent sales-tax increase, divided between transit and local streets. For voters, new talk that some of the deepest service cuts might be avoided raises the question of whether the county was crying wolf.
County Councilmember Rod Dembowski says no, that Metro was being candid about its needs, and that an uptick in sales-tax revenues — Metro’s largest source of income — happened after the ballot measure was written.
Late in the campaign came new county sales-tax projections for Metro that are up $32 million for 2014 and $31 million for 2015, compared to earlier assumptions. Dembowski is hoping that economic recovery, and attempts to increase fares, would avert the worst of the cuts.
His proposal, which passed in committee 4-3 last week, would enact only the September cuts, look for more savings and defer the February, June and September 2015 rounds.
By November, leaders could make better-informed choices because they’ll have updated tax figures, and perhaps a signed labor-union contract with transit drivers, mechanics and staff, said Dembowski, whose electoral district includes Northeast Seattle, Shoreline and northeast suburbs.
“People make a myriad of life decisions based on transit service. They rent an apartment or they don’t. They buy a car, or they don’t. They take a job, or they don’t. They send their kid to a school, or they don’t,” he said. “I don’t think we should tell them we’re cutting a line in 2015 when we don’t have to do it.”
A counterproposal late Friday, signed by four of the nine council members, would also follow through with September’s cuts but keep the three 2015 cuts unless County Executive Dow Constantine can find sufficient income and savings by Nov. 30, and issue a plan by Jan. 7, to restore some of the doomed routes. Councilmembers Dave Upthegrove, Larry Phillips and Joe McDermott and Larry Gossett are making that proposal.
Metro preserved its bus service through the recession and afterward by spending cash reserves, raising fares $1, tightening schedules, reducing staff and enacting a $20 car-tab fee, which expired in May. Proposition 1 would have roughly covered what’s now a $75 million structural deficit per year.
Dembowski, a Democrat, occupies a swing position on the nine-member council. Within his District 1, the Lake City and Wedgwood areas of Seattle strongly backed Proposition 1, Shoreline was opposed, Lake Forest Park slightly in favor and the Bothell-Woodinville area opposed.
There are a number of areas he wants to explore:
• Fares: The council already approved a 25-cent increase for 2015. Dembowski wonders if another 25 cents should be tacked on in 2016, instead of waiting until 2018, to gain $6.5 million a year or 65,000 yearly service hours.
The downside is, a 50-cent increase would make Metro’s fares the highest among large U.S. bus agencies, at $2.75 off-peak, unless others such as Houston and New York raise theirs, said Sung Yang, chief of staff for Constantine.
• Transfers: Eliminating paper transfers could save $4 million a year in printing and distribution costs and reduce fraud, he said.
• Passes: ORCA monthly passes should be priced to equal the cost of 40 one-way trips instead of the current 36, he said. Programs to sell bulk passes to employers at a discount should be examined, he said.
• Reserves: If all the cuts happen, and sales-tax revenues grow at roughly 4 percent a year, Metro would accumulate an $822 million reserve by 2021, according to a council-staff spreadsheet. By comparison, operations spending was $640 million last year. Metro needs reserves, but not necessarily so much, Dembowski argues.
• Trolleybuses: The agency’s aging fleet of 159 electrically powered buses is supposed to be replaced right away, causing spikes of roughly $100 million a year in capital-replacement spending in 2014-17. Dembowski wonders if the spending can be spread out through financing.
Previously, Metro General Manager Kevin Desmond and Constantine each said debt use would get a look by outside auditors, but they personally were reluctant to burden future generations with interest costs.
The growth in sales-tax revenues seems to be the most controversial. Councilmember Upthegrove of Des Moines warned against counting on “magic money” during committee debate last week.
Stung by two economic slumps since 2000, Councilmember Phillips of Magnolia says he’s leery of being burned again — even after Metro has downscaled its sales-tax revenue-growth assumptions from 5.75 percent in 2006 to around 4 percent from 2015 forward.
“Hope is not a plan,” he said. “You can’t hope these dollars are going to materialize. You’ve got to plan based on the money you’ve got.”
Another problem is that if the cuts are needed, Dembowski’s plan would wind up delaying each phase by three months to allow sufficient preparation, causing a $14 million loss, Yang said.
Meanwhile, Seattle is considering ideas to pay for in-city bus hours, in the event of Metro cuts. Proposals include tab fees or property, sales, employer or parking taxes. Mayor Ed Murray has already promised to set aside Seattle Department of Transportation funds to preserve Night Owl buses.
Mike Lindblom: 206-515-5631 or email@example.com. On Twitter @mikelindblom