Sales tax, la­bor out­sourc­ing pro­posed for Metro fund­ing

The Washington Times Daily - - FRONT PAGE - BY RYAN M. MCDER­MOTT

The chair­man of Metro’s board of di­rec­tors is hail­ing Gen­eral Manger Paul Wiede­feld’s call for ded­i­cated fund­ing for long-term re­pairs and lower la­bor costs for the trou­bled tran­sit sys­tem, but the union rep­re­sent­ing most Metro work­ers said it is “bad for the re­gion.”

Board Chair­man Jack Evans pro­posed on Thurs­day a re­gional 1 per­cent sales tax on the Mary­land, Vir­ginia and D.C. ju­ris­dic­tions ser­viced by Metro to se­cure a $500 mil­lion-a-year fund­ing stream for the na­tion’s sec­ond-busiest mass tran­sit sys­tem.

“Ev­ery­one in the re­gion has a vested in­ter­est in Metro,” said Mr. Evans, who also serves on the D.C. Coun­cil.

How­ever, Amal­ga­mated Tran­sit Union Lo­cal 689 said any at­tempt to lower la­bor costs by hir­ing con­trac­tors to fill union jobs would “de­mor­al­ize the work­force in a race to the bottom.”

Late Wed­nes­day, Mr. Wiede­feld re­leased a slate of pro­posed changes aimed at sav­ing the cash-strapped sub­way sys­tem from fi­nan­cial and op­er­a­tional ruin. Ac­cord­ing to the 10-year

plan in his com­pre­hen­sive re­port, the gen­eral man­ager said Metro needs a new busi­ness model and $15.5 bil­lion over the next decade to re­main “safe, re­li­able and af­ford­able.”

“While Metro has $25 bil­lion in to­tal un­funded cap­i­tal needs, WMATA will re­quire $15.5 bil­lion of this amount over the next 10 years for crit­i­cal cap­i­tal projects,” the re­port says, us­ing the acro­nym for the agency’s full name, Wash­ing­ton Metropoli­tan Area Tran­sit Author­ity.

That lack of cap­i­tal fund­ing over the decades has left the sys­tem in dis­re­pair, and forced Metro of­fi­cials last year to pur­sue a sys­temwide re­ha­bil­i­ta­tion that has been the bane of rid­ers try­ing to get around the re­gion.

Mr. Wiede­feld pro­posed that re­gional lead­ers find an an­nual $500 mil­lion stream of ded­i­cated fund­ing for longterm cap­i­tal re­pairs to the sys­tem. He noted that Metro is still one of the only ma­jor Amer­i­can tran­sit sys­tems with­out ded­i­cated fund­ing for cap­i­tal re­pairs. But he stopped short of telling Mary­land, Vir­ginia and the District how to come up with that money.

Mr. Evans, Ward 2 Demo­crat and Metro Board chair­man, said the District’s chief fi­nan­cial of­fi­cer had de­ter­mined that a re­gional 1 per­cent sales tax in each ju­ris­dic­tion Metro serves would gen­er­ate $500 mil­lion to $700 mil­lion a year.

That pro­posed tax would have to be ap­proved by the county gov­ern­ments in Vir­ginia and Mary­land, as well as the District. The sales tax idea, which has been floated be­fore, has gen­er­ally not been well-re­ceived in Vir­ginia.

Mr. Evans ac­knowl­edged that the tax idea could gen­er­ate con­sid­er­able grum­bling in Vir­ginia but said com­plain­ers should think about the re­gion as a whole and the ben­e­fits of Metro. The sys­tem is a boon for the re­gional econ­omy with hous­ing devel­op­ments, restau­rants and other busi­nesses be­ing built near sta­tions.

“It is an eco­nomic driver,” he said of the tran­sit sys­tem.

Mr. Wiede­feld also is hoping to re­duce worker costs by switch­ing from a pen­sion to a de­fined con­tri­bu­tion pro­gram, such as a 401(k), and by open­ing some jobs to nonunion em­ploy­ees.

Metro is fac­ing a $1 bil­lion un­funded pen­sion li­a­bil­ity as well as $1.8 bil­lion in other re­tiree ben­e­fits.

The pro­posed use of con­trac­tors for cer­tain projects in­stead of union work­ers raised the ire of ATU Lo­cal 689, which rep­re­sents more than 12,000 Metrobus and Metro­rail work­ers.

“Paul Wiede­feld’s pro­posal for WMATA is bad for rid­ers, bad for work­ers and bad for the re­gion,” the union said. “In­stead of of­fer­ing real pro­pos­als to im­prove the sys­tem and win rid­ers back, Wiede­feld has, once again, pit­ted rid­ers against work­ers in an at­tempt to bal­ance the agency’s bud­get on the back of WMATA’s hard­work­ing em­ploy­ees.”

The union said out­sourc­ing some Metro jobs would make the sys­tem less safe, less re­li­able and more costly, and that Mr. Wiede­feld has not been re­spon­sive to worker needs.

“In­stead of open­ing a di­a­logue with WMATA’s work­force on how to im­prove ser­vice and fix the sys­tem, the gen­eral man­ager has cho­sen to go around our ne­go­ti­ated contract and bar­gain in bad faith through the me­dia,” the state­ment said.

But Mr. Evans said even the unions need to cede some­thing to make Metro work again.

“What they have to rec­og­nize is that … ev­ery­body’s got to give some­thing,” he said. “The al­ter­na­tive is no sys­tem.”

The plan also pro­poses a rainy-day fund equal to 10 per­cent of the sys­tem’s an­nual $1.8 bil­lion op­er­at­ing bud­get for emer­gen­cies such as se­vere weather. It also would cap the op­er­at­ing bud­get in­crease at 3 per­cent as a way to bal­ance out the ex­tra fund­ing needed in the cap­i­tal bud­get.

The Coali­tion for Smarter Growth, a lo­cal group push­ing for more tran­si­to­ri­ented devel­op­ment, ap­plauded the plan.

“The gen­eral man­ager’s plan is the best we’ve seen to date,” said Ste­wart Schwartz, the group’s ex­ec­u­tive di­rec­tor. “His state­ment is bluntly hon­est about the sit­u­a­tion and we gen­er­ally en­dorse his pro­pos­als, although we will need more in­for­ma­tion about some of them.”

Mr. Schwartz said the hon­esty of Mr. Wiede­feld’s plan “rep­re­sents our best op­por­tu­nity to de­velop shared facts and un­der­stand­ing about the chal­lenges and best fixes for the sys­tem in time for leg­isla­tive ac­tion on fund­ing next year.”

The group also said re­gional lead­ers need to step up and find more money for long-term re­pairs.

“For too long, our elected of­fi­cials haven’t made Metro’s state of good re­pair needs a pri­or­ity — year af­ter year ap­prov­ing a re­gional transportation plan with­out fully fund­ing Metro cap­i­tal needs,” Mr. Schwartz said. “Metro is the back­bone of our transportation net­work and re­gional econ­omy and, as such, mer­its the fund­ing needed to fully res­tore the sys­tem.”

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