Discussing Mass Transit Part V - What is RFTA Proposing?

September 24th, 2008 at 07:29am Common Sense Alliance 1530

The Bus Rapid Transit (BRT) plan for the Highway 82 corridor has a large number of parts and pieces, but we need to look at the big picture before moving on to the fine detail.

RFTA wants to embark on a major transit expansion plan over the seventeen year period from 2009 to 2025.  Total capital costs of the plan are in the range of $180 to $190 million, and annual operating expenses are projected to more than double, from a current $20 million or so to about $40 million.

During various presentations to the public and elected officials, the feedback was that the plan was too large to absorb all at once, both conceptually and financially, and that a phased approach would be more appropriate.  The term “BRT Lite” was first proposed, but RFTA board members wanted to stress that the full BRT plan hadn’t changed, just the size of the first bite.  So, “BRT Phase 1” is the moniker for the initial plan which the federal government and local voters will be asked to endorse and fund.

RFTA has not received much encouragement regarding federal financial participation, so they have also developed a plan for how to use the revenue if local voters approve a sales tax increase which is not augmented by any federal grants.  The sales-tax-approval-with-no-federal-money scenario is really another layer of phasing; let’s call it “BRT Phase 1 Lite”.

Does RFTA need additional tax revenues to maintain current operations, regardless of whether federal funding sets off an expansion plan that will eventually result in a full BRT system?  Consultants prepared graphs for public presentation, one of which illustrates a “Baseline” financial forecast indicating that RFTA is solvent through 2019, reaching a spending level that year of about $40 million.

However, a “Likely Trends” graph line, apparently intended to predict what RFTA will need to spend to keep pace with increasing ridership demand in the absence of a BRT system, shows a deficit beginning next year, growing to $6 million per year by 2025.

The latest Likely Trends scenario, a version developed in May, assumes a fleet expansion of 10 vehicles - scaled down from an estimate of 22 a month earlier!  This sudden downward adjustment is difficult to understand, and the ability to do so doesn’t lend much credibility to ridership projections.  Despite this, there has yet to be any official questioning of ridership assumptions, or the need for additional rolling stock.

Contributing to the sense that the definition of Likely Trends is highly flexible are those items on the latest budget that went up in price, even after the number of buses went down.  The line item “ITS/Transit Priority”, a key technology feature of the BRT system, is on the Likely Trends budget for $12.3 million, as is a maintenance facility expansion at $10.25 million – only $0.5 million less than would be required to accommodate BRT Phase 1.

RFTA’s Likely Trends scenario has become indistinguishable from “BRT Phase 1 Lite”, a significant evolution from its original function as a number representing the response to projected ridership growth.  The conclusion can only be that BRT is a fait accompli - even if the proposed sales tax increase is needed just to maintain the current system.  The real “likely trend” is that RFTA will continue to grow beyond its revenue base, evidenced by the fact that if they do successfully secure approval of both higher sales taxes and the requested federal contribution of $21.3 million, they will need another round of tax hikes as early as 2013.

The likelihood that additional tax revenues may be needed to simply keep running in place, with no new service expansion, is illustrated by actual trends:

Between 1997 and 2007, RFTA operating expenses increased by 130%.

Population in the RFTA service area grew by 38%.

RFTA Ridership grew by 21%

The most peculiar wrinkle in the financial reporting has to do with the aforementioned $10 million maintenance facility expansion.  In a presentation to Aspen and Pitkin County officials last April, RFTA indicated that current maintenance facilities are already operating beyond design capacity by about 19 vehicles.

How then did RFTA develop a Baseline financial forecast that doesn’t indicate a budget shortfall for maintenance expansion and the operating and maintenance expenses associated with the additional buses and vans?  This is one of the serious perception problems that need to be addressed by RFTA, and another has to do with federal financing rules.

As explained by Dan Blankenship and Kristin Kenyon to the RFTA board:  “FTA doesn’t want the VSS/SS program to be used by transit agencies for supplementing funding for existing services…”  Don’t worry about the acronyms, the message is clear.  If you want federal assistance you need to be creating a new service, not just shoring up an existing system.

The appearance that the perpetual expansion of service may be related to a persistent underreporting of financial reality is disturbing.  Neither local taxpayers nor federal regulators should be subjected to a scheme to finesse current financial needs in the guise of an entirely new service proposal.  If RFTA cannot maintain current service at current tax levels, they need to address that situation head on, and completely separate from any new service proposals.  Consolidation should precede further expansion.

Assuming local taxpayers are willing to be taxed again to keep RFTA solvent at current service levels, it appears they will be unable to accomplish that goal without simultaneously launching a chain of events intended to increase transportation spending by additional hundreds of millions of dollars.

It may be more appropriate to offer voters a chance to choose between the two.

Next:  Part VI

To BRT or not to BRT?

Entry Filed under: Transportation, Basalt, Snowmass, Carbondale, Glenwood Springs, Aspen, El Jebel, Pitkin County, Rifle, Silt, Garfield County, Eagle County