Archive | March, 2012

WeAllRideTheBus and reform at TriMet

One of the interesting developments of the past few weeks is that the organizational efforts of OPAL Environmental Justice Oregon seem to be bearing fruit. TriMet’s recent scaled-back service cuts seem to take many of OPAL’s concerns into account (notwithstanding the warning that additional cuts may be back on the table if labor negotiations don’t go TriMet’s way), and now OPAL has managed to recruit some more serious political muscle into its advocacy, with its new campaign, We All Ride The Bus. In this organizational effort, OPAL is joined by several heavier hitters, including Gunderson (a railcar manufacturer in NW Portland, adversely affected by proposed reductions to Line 17 service) and SEIU Local 49, to campaign for improvements to TriMet’s basic transit service, primarily the bus system..

This past week, We All Ride The Bus held a press conference in which they released their proposed Alternative Solutions for the TriMet budget, which are reproduced after the jump. (They can also be read at OPAL’s Facebook page).

First, TriMet must ensure full transparency and accountability by using the most current projections for next year’s budget. TriMet should update its analysis of the payroll tax revenue and federal grant projections so everyone can be more fully informed of the situation.
Second, instead of resorting to fare increases and service cuts, TriMet should fully analyze alternative cost-savings and revenue-generating options. Some initial alternatives include:

  1. Premium Fares for Premium Service: Portlanders currently have access to a variety of free and convenient services that come at a high price to TriMet and its budget. Charging a reasonable user fee for Park-&-Ride lots can generate $1.5 million per year, while charging a premium fare for the Westside Commuter Service (WES) can generate $500,000. Services that cost the region more money to build and operate should be proportionately priced.
  2. Portland Streetcar Subsidies: TriMet should trim payments to the City of Portland (currently $6 million each year) to subsidize the expansion and operation of the Streetcar. Although the city’s investment in the Streetcar has brought many new businesses and economic opportunities to the area, these investments shouldn’t be at the expense of bus service or affordable fares for other areas of the region.
  3. Performance Efficiency Measures: It is imperative that TriMet start investing in our bus system for the long term. TriMet should be looking at ways to get buses moving faster, such as installing ticket validation machines to expedite the boarding process and maximizing the use of bus jump lanes and traffic signal prioritization. A more efficient bus system will save money, allow TriMet to increase frequency and will give its customers reason to believe in – and ride – the bus again.
  4. Reevaluate Future Capital Rail Project Investments: Keeping our current commitments is important, but in a budget crisis, future capital investments in rail expansion projects should be put on hold until current services can be funded sufficiently. As with any business facing operational cut backs, TriMet should exhaust all options to postpone future capital expenses if they are restricting operating expenses for the bus system.

In general, I agree with the substance of these proposals. While I’m hopeful that rapid transit can be added to the SW Corridor in the mid-term, and don’t object to planning activities now underway, I think that in the nearer term, strengthening the existing transit system, in particular our bus system, is vitally important.

But beyond the above suggestions, there’s a few other things I think need to be on the table.

A conversation about the purpose of transit

A big disconnect that I’ve long noticed is that TriMet, and many transit wonks, are convinced that the current program of building out light rail is fundamentally a good idea–yet many existing patrons, who may not use the new services but see their own bus lines being cut–beg to differ. Cameron Johnson of Bus Riders Unite (another OPAL project), in testimony before the TriMet board meeting, compared the agency to a slumlord that neglects his rental properties (the bus system) and instead concentrates his resources on building the nicest swimming pool on the block (MAX) to impress friends and outsiders. The analogy reveals a fundamental belief about rail expansion that some hold–that it’s a frivolous boondoggle, unrelated to the agency’s primary mission. On the other hand, about a third of all TriMet boarding rides are on MAX–so clearly, it can be argued, it’s providing living space, to continue the analogy. (A better analogy might be that MAX is shiny the new apartments going in next door, while the old ones are being neglected).

Why the disconnect? Different people have different beliefs about the fundamental mission of TriMet.

Two years ago, I did a post over at Dead Horse Times on the different missions (and anti-missions–go read the article) that a transit agency might seek to fulfill. OPAL, BRU, and other rider organizations are generally most concerned about mobility-oriented missions: comprehensive and thorough basic transit service, with a particular focus on social justice. Making sure people can use the system to get from point A to point B, in a reasonable fashion and at a reasonable price. And if one is primarily concerned with these ends, a comprehensive, distributed bus network is one of the best ways to achieve it. Concentrating resources in dedicated corridors, which is what rapid transit necessarily involves, doesn’t serve these missions very well.

Many in our political leadership, however, have environmental-oriented missions in mind: Attracting people out of cars. Transforming the built environment to a more sustainable form. Reducing emissions, including of transit rolling stock. And the way you support these missions is to build electric-powered rapid transit (which generally means rail, as trolleybusses are not effective in rapid transit roles), build out to suburbia, provide amenities to so-called “choice” riders who might otherwise choose to drive, curtail or shorten “low-performing” routes, and encourage (or even invest in) transit-oriented development–including providing transit service to new developments on a speculative basis.

This, I think, is a big part of why the two sides in this are not communicating well. People trying to get to their jobs and live out their lives are not as likely to be sympathetic to more abstract environmental concerns, which frequently are found higher up on the hierarchy of needs. It’s easy to conclude that rather than being driven by an environmental agenda, leaders are being driven by pork-barrel politics or other base motives (a desire to make Portland appear more cosmopolitan or “European” is often suggested as a hidden rationale for capital transit investment). Of course, leaders, for their part, are in many cases following the law–regional plans include environmental goals (reduce VMT, reduced emissions) that leaders have to adhere to.

Rather than continuing to talk past each other, the political leadership of the Metro area and OPAL and other ridership groups need to come to an understanding on this. And rather than diverting resources from existing to new service as an operations detail, a public conversation ought to be had as to how much of our transit dollars will be spent on providing basic service, and how much will be spent on projects with a primary environmental rather than mobility bent.

Endowment

In Part 3 of our recent interview with Neil McFarlane, he noted that TriMet board policy limits the agency’s debt ratio to 7.5% of operating revenues. (I suspect that this policy excludes the unfunded pension and OPEB obligations, which are closer to 200% of operating revenues–albeit most of this debt will not come due for years if not decades). And there’s a good reason for this policy, beyond the obvious one of not getting too far into hock: operational dollars are the most scarce kind. The FTA will happily throw money your way for capital projects, but operating grants are rare–most operating revenue comes from fares, the payroll tax, and a small amount from other sources such as advertising.

One of the major criticism of the Milwaukie MAX project is that TriMet is issuing $60 million in bonds backed by payroll tax revenues to get to $745 million dollars. While the FTA matches that $60M, the bonded money represents revenue lost to operations until the bonds are retired. The Oregon Legislature has approved a small hike in the payroll tax to offset this, but that’s money that could go to service (or to funding the aforementioned pension and OPEB obligations).

Not funding operations has been a longstanding FTA policy. It’s a dumb one in my opinion, but it’s unlikely to change soon.

However, Uncle Sam only provides half of the capital costs for MLR–the other half is provided by local sources: Metro, municipal governments, and the state of Oregon. And these local governments don’t have a set-in-stone policy of only financing capital costs.

Thus–rather than going to the Oregon Legislature and asking for lottery dollars to build the next MAX line; what about instead asking for money to start an endowment–a pool of money which sits in a safe place, possibly managed by a trustee? Having such a thing in place could solve several problems:

  • First, the interest on this could be used to fund operations, or short-term capital needs (like bus replacement).
  • Second, the endowment could be nominally pledged to the pension/OPEB obligations, helping TriMet clean up its balance sheet.
  • Third, the money might be drawn down (borrowed from) in lean times as a way of tiding the agency through recessions, to help avoid service cuts at a time when additional service is often needed

The downside of this sort of an endowment is large piles of money tend to attract people looking to capture it for themselves: Labor might try to use it to justify pay/benefit raises; anti-tax groups might try and demand a reduction in payroll taxes, etc. So this has to be managed carefully. But all else being equal, I’d rather TriMet be earning interest rather than paying it.
Separation of operations and capital planning
This next suggestion is as much a political suggestion as anything else. In many ways, TriMet is two agencies, joined at the hip. One is a transit operations company, which provides bus and train service to the general public. The other is a capital projects agency, which designs and builds stuff. Many of the things these two halves of the agency do are separate–operations are mostly funded as noted above, capital projects are mostly funded through grants–but this distinction is not often well-understood.

If TriMet had a dollar for every time somebody suggested solving the budget crisis by laying off planners or engineers, it wouldn’t have a budget crisis. The fact of the matter is, though, most of the folks on the capital projects side of the house are being paid by funding sources that simply can’t be diverted to operations.

Given that–might it be useful if the capital planning function was housed elsewhere (Metro, perhaps), or at least treated as a separate agency with separate books?

There would be many consequences to such a re-org, so at this point I’m mainly proposing it as an area of further study–but it might be worth considering.

Your Questions for Neil, Round 3, Part 4 – Potpourri

In the final segment of our conversation with TriMet General Manager Neil McFarlane, we discuss a range of issues, from regenerative braking to electronic fares.

A transcript of the interview, prepared by Engineer Scotty, follows the jump.
CS: All right, our final area of questions is sort of a potpourri area, so excuse me for skipping around a little bit…

NM: Is this the speed round?

[laughter]

CS: Well I don’t know, we’re doing pretty well on time, so I don’t really have to rush. A couple years ago, TriMet received a grant to put regenerative braking energy storage system on, I think 20 MAX vehicles. What’s the progress on that?

NM: Actually, we had a pilot installation, more earlier this year. My understanding is we’re monitoring it, and it’s progressing well. I haven’t had a full report on it, it’s.. some of our vehicle engineers continue to work with it. It was kind of a thing where I think there was going to be a certain level of tweaking associated with it, and so that tweaking was going on with the prototype installations that we had. But moving ahead, and will be in place before long.

CS: OK, I’m sure our readers would love to hear about it. A question that comes up, probably every time you do service planning. Today we have an Alder-Washington couplet, I’m sorry, an Alder-Salmon-Washington couplet, very far apart, people keep asking why can’t we do Alder-Washington instead?

NM: Well, that’s a really excellent question, and it probably goes to more history than I have, about why these routes are on these particular streets they have. I do know that the 15 that we’re talking about here, the number 15 line, also serves the Goose Hollow station (sic). Well, there’s a lot of transferring that goes on between the 15 bus line and the MAX line, and so then… once you get that far, where you’re really providing a close transfer connection to the westside portion of the MAX line, then Salmon is about the first street you get to that heads east, so that’s one notion. And, you know the other consideration I think we’ve got is that Alder is a pretty busy street, a lot of businesses, a lot of parking, it’s kind of an onramp to the bridge, at one end, so I think there’d have to be a little bit of research and study as to whether or not it’s worthy of really looking at. I’ll ask Service Planning the question again, if they’ll actually look at that. I guess the other observation I’ve got is that there’s a pretty excellent couplet one block over at Morrison and Yamhill, or two blocks over at Morrison and Yamhill, which I think serves that east-west travel through downtown pretty well, it’s almost a moving sidewalk of trains these days, with all the different combinations of lines on it.

CS: TriMet’s been a pioneer in real-time arrival, and services around that, I personally participated in some of the software development around that, but the question we get is that while the busses have GPS, as I understand it, the predictions for the MAX trains come from circuits in the tracks, and are not always as accurate. Our readers would like to know, is there a prospect for better accuracy on the MAX arrival predictions?

NM: Great question, and I’m afraid that I don’t know the answer. But I would tell that in the, over the rest of this calendar year, we will be updating our AVL (automatic vehicle location) system and our radio system on the bus system, so rather than having what is now I think is a satellite update every three minutes, we’ll be compressing that, it will be even shorter. So for the busses themselves, we will be getting more accurate information here out to customers, probably by the end of the year. That’s combined with another one of our major, frankly, re-investments in the bus system, which is a new automatic dispatch system, new radio system, and new consoles on the busses themselves. Part of that, again, later this year, we’ll begin to see a new printer for transfers as well. And one of our long term.. a lot of people say, well how come you have, as I call it, the best of the 19th century technology for our current transfers on the bus, whereas we have much more elaborate printing devices for the MAX, and this will begin to equalize between the modes, and I think will be a great asset, both for our riders and for our operators, particularly who right now have to be careful how they tear that little piece of paper.

CS: And our last question is also a technology question. Last month, you released a white paper on electronic fare technologies. What’s the timeline in which our readers can look forward to seeing some of that technology deployed?

NM: Well, believe it or not, it’s probably about five years. Later this year, and the budget does include a little bit of a stipend for this, is that we’ll be releasing an RFP (request for proposals) looking for some technical assistance for this. Meanwhile, we’ll be continue our conversations with many others in the transit, many of our peers in the transit industry. And this is a really hot topic in transit industry nationwide. I think one of the great advantages of moving from, as I say, from the 19th century to now, to the cutting-edge technology that’s out now, is we’ll be skipping whole generations of technology, and the old smart card technologies that frankly, a couple years ago, we would have thought was cutting edge, may not be cutting-edge by the time we actually implement this. But believe it or not, five years is probably about as fast as we can do this, just given the need to develop the specification carefully, to do research for some of the different providers, to actually begin to prototype some things, and then do the actual procurements related to the contract, and the installation. I’d also expect that as we start, we’d do some pilot projects where we might not do the whole system all at once, we’d try a segment of it, maybe give Portland Transport readers access to it, and TriMet employees, and begin to see how it works for us, subset, before we make it ubiquitous across the system. It’s a big deal. There’s nothing more difficult for a transit agency than fare technology, because it, it is literally touches every element of our operation, from our operations, to our finance division, to the legal division, to the IT division. It takes incredible coordination and communication to be able to pull this off well. We’re committed to doing that, and as you know, I’ve made this a bit of a priority, that we begin to really focus on this as an agency.

CS: So what do you see as some of the key benefits to riders, from the transfer to electronic fares?

NM: Well, I think ease will be one, first of all, if one is using either a proximity credit card or a near-phone, near-field connection from a cell phone, I think it would be very easy for both regular riders, as well as occasional riders, to use the system. The other thing is I think there will be some advantages in terms of fare evasion, and I think we’ll be able to catch it, because what happens in these systems is you walk on the bus, you flash your device, and you get a green light or a red light, and it’s very clear, and there’s no level of interpretation on the part of the operator, about whether or not the fare instrument is right, because the computers make, defines the rules, in that regard. So I think there’s some advantages to that as well. It will reduce the leakage, I guess you can say, in the current fare system. I also think that there will be incredible advantages to us, to those of us think about planning and transit development in terms of information that will be available. We get incredible origin-destination data from those systems, so I think will be very help to planning systems in the future. So I think there are really some substantial benefits. Another one, and I’ve asked our project staff for the Portland-Milwaukie project to look at this, is whether or not we can begin to prototype a closed station design, much like you see at the Washington Metro or the New York City subway, and begin to prototype that at the Bybee station, on the Portland-Milwuakie line. And that might be a prototype for other stations in suburban areas, particularly where there’s accesses, we can actually constrain the access to the stations, so only paid fareholders can access the platform or the station.

CS: So, if I recall the City Club discussion–I think you got that question at the City Club about open vs closed platforms, and you made the point that certainly in the central city, the stations are part of the urban fabric, and it would be very hard to segregate them. Is there a value to being able to close some stations without being able to close all of them?

NM: I think there is. I think for example, some of the stations that where they’re a bit removed from the street, like along the Banfield, I think people would feel more secure if they knew only other fare-paying passengers were there. And while we have done a lot of work in terms of cameras and lights, the access control would be one additional improvement related to security. And I think, in some of those situations, you know, frankly, just making sure that anybody who’s able to access the trains, or get off the train, because it’s the same situation, has paid, is, will help with the leakage question, that I raised earlier.

CS: We’re talking about the benefits of potentially closing some platforms. I think in the past, 82nd Avenue, I think, has been a suggested location for security reasons for that. Any comment as to whether that would fit within this scheme?

NM: It would, in the future. I might note that we’ve completed a pilot project for 82nd Avenue, working with the neighborhood, and Portland Police, and Portland Department of Transportation, and ODOT all part of that, and what we did was improve lighting, we made sure that the platforms are clearly marked as fare-paid zone, that allow our fare inspectors and transit police to do more inspections to make sure that people who are on the platform are, do have a legitimate fare, i.e. and a legitimate reason to be there. So a number of improvements were taken, have taken place, but that’s a little different than having the closed physical barrier, and we obviously just don’t have the technology in our fare system to allow that right now, and that would be the innovation that we improve.

CS: I’d like to thank you very much for sharing this time with our readers.

NM: All my pleasure. Thank you, Chris.

Shoup Weighs in on NW Parking Plan

A few years before starting this blog in 2005 I channeled my wonkery hours into serving as the lead neighborhood representative in trying to develop a parking plan for NW Portland.

I still have the scars from when that effort crashed and burned. At the time I predicted that we had poisoned the well for another decade.

Well, 10 years have passed and the Mayor is taking another run at it, with more or less the same pathologies at play.

So I was interested to see that parking expert Donald Shoup had expressed an opinion on the plan. Not surprisingly Shoup thinks his approach of dynamic pricing could be part of the solution.

Part of the disconnect in the debate is that the merchants on NW 23rd are convinced that metered parking will drive their customers away to Washington Square or elsewhere. The Mayor and others argue that metered parking will result in greater turnover and more traffic for the shops.

Shoup essentially says yes to both points of view. Pricing will create turnover, but by using dynamic pricing, if the price is high enough to leave too many spaces unfilled, it would be lowered until we hit the magic 85% occupancy point.

It’s actually a pretty reasonable approach to getting the two sides on the same page. Although my gut says that there is sufficient demand that dynamic pricing would not result in a rate much lower than downtown meters anyway.

Your Questions for Neil, Round 3, Part 3 – PMLR

In the third segment (of four) of our conversation with TriMet General Manager Neil McFarlane, we discuss the Portland-to-Milwaukie Light Rail project.

A transcript of the interview, prepared by Engineer Scotty, follows the jump.
CS: Let’s change topics a little bit… Portland-Milwaukie. We’re under construction now, you’re building a bridge in the middle of the river… some observers have noted that if you look at the cost of the project, on an inflation-adjusted basis, it’s about the same price tag as the Westside line, but the Westside line is something like twice as long. You came up through capital projects within TriMet… why is this project so expensive on a cost-per-mile basis?

NM: Well, there’s a couple of things that factor into that. One is that the cost of this project also includes the financing cost, so it’s an all-in cost including the interim financing associated with the project, sort of the construction period financing. That wasn’t the case with the Westside, partially that’s just an accounting difference that the federal government has instituted. I would say the other piece of is that the federal government also now carefully reviews all the estimates, and wants a very comfortable contingency on most of their projects, and I think there is a very comfortable contingency, and it’s much more comfortable contingency than I’m used to seeing when I was managing capital projects at TriMet. That might mean that there will be some opportunity for re-investment along the project toward the end, but that will be up to FTA because they control that dial right now.

CS: So if you come in with unspent contingencies, what are some of the things on the wish list that might go to?

NM: Well, there is, actually, a deferral list associated with the project, part of it is some of the pedestrian overcrossings over the UP line in the SE Portland area, additional capacity at park-and-ride, particularly at Tacoma station, and a few other accoutrements aligned for stations and other things along the line. I don’t have the full list in my brain, but those are the biggest ones. And there are other kinds of investments that we always like to make with our projects, including sustained transit oriented development to occur around our station sites, so that we actually begin to build the neighborhoods that we want to see around our stations, and begin to see that development in the right way. So there’s some hope, again, but very early in all of that. The other factor about this project, that I just wanted to note that’s different with some of the others, is that it really needs to carve its own right-of-way out of SE Portland, and so that meant a lot more property acquisition, more than any project we’ve had since the Westside.

CS: So that’s the upside, if we have some contingencies left over. Let’s talk about the downside. There’s some interesting ballot measure activity going on in Clackamas County right now… is the Portland-Milwaukie funding secure, and are there any conditions under which you might consider terminating at the MOS and dropping the Park Avenue station from the project?

NM: The funding is secure. We have signed contracts with all of the governments along the line, starting with Portland all the way down through Milwaukie and Clackamas County, and those agreements were agreed to by all the partners. The other thing I’d say is, the federal government when they approve and consider these projects, are considering the thing as a whole. So they’re considering a project that starts at Portland State University, at the transit mall, and ends in Oak Grove, and that’s the part they evaluated, and that’s the project they’ve agreed to fund at the level that they have, about $745 million of discretionary federal funds coming to Portland with this project. So, my view is that it secure, and we have the strong support of the federal government, the federal transit administration. They’re moving this project forward, and we’ve been very honest with them about these issues in Clackamas County and Milwaukie. Both those bodies have voted twice for the project, for the Locally Preferred Alternative as well as for the funding agreement.

CS: So if there were some circumstances in which you’d have to consider the minimum operable segment, you’d have to go negotiate with the FTA to be able to do that, is that what you are saying?

NM: If there were that circumstance ahead of us. I’m not anticipating that.

CS: Okay. We’ve talked about the potential of some contingency funds being available at the end of the project. One of the ways of funding Portland-Milwaukie is issuing bonds against future revenue, which is revenue which could be used for operations otherwise. Is there any consideration that if we do have contingencies left, we could reduce the level of bonding, or preserve future operating capacity?

NM: Probably not. The FTA does require that the scope of the project be defined in the Full Funding Grant, so the use of any funds, really, is contingent upon FTA approval, so they would have to look at that themselves. And so at the end of the day, we’d be petitioning to Portland, to the Federal Government to perhaps suggest an improvement of one or another in the project. But it would be specifically related to the project, and that’s the nature of those discretionary capital dollars from the FTA. Just to note on those funds. Up to now, we have not put any TriMet money into the Portland-Milwaukie project. The funds have been partnership funds from the State of Oregon, and some grant funds that were available to us from the MTIP funds that Metro allocates. So, if you look at the difficult time that we’ve gone through, from a budget standpoint, Portland-Milwaukie has not contributed to that at all, up to now.

CS: First payments on the bonds will hit what budget year?

NM: I think they will actually will hit in fiscal 13, the way we have it right now. And so, one of the other things I would just note about TriMet and capital bonding is that we have a very low debt ratio associated with the agency. The Board has adopted a debt policy that limits our overall debt to about 7 1/2% of our overall payroll tax. So if you think of that as a homeowner’s budget, you know that’s a pretty low debt ratio, and if you compare us to other transit districts around the US, you’ll find that that’s a pretty low ratio. Now that’s intended, because we, with all of our partners, recognize that’s incredibly important to preserve as much operating dollars, out of the TriMet payroll tax as possible, so it’s only a little bit of leverage from the capital side that we ask for from TriMet, and we look for patnership funds to do the balance, and that’s quite intentional. If you look at the history of projects that we’ve done, all the way from the Banfield through, you’ll find first of all that the Federal Government’s contributed about 60% historically, of those funds, as much as 83, or 82 on the Banfield, 80% on the Interstate, to 50% here, but then other partners have contributed the balance.