WMATA’s FY2010 Budget Presented to the Committee on Public Works and Transportation Council of the District of Columbia The Honorable Jim Graham, Chairman by John B. Catoe, Jr., General Manager Washington Metropolitan Area Transit Authority April 20, 2009
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WMATA’s FY2010 Budget Presented to the Committee on Public Works and Transportation Council of the District of Columbia The Honorable Jim Graham, Chairman.
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WMATA’s FY2010 Budget
Presented to the
Committee on Public Works and Transportation
Council of the District of ColumbiaThe Honorable Jim Graham, Chairman
by
John B. Catoe, Jr., General ManagerWashington Metropolitan Area Transit Authority
April 20, 2009
Increasing ridership demand
Rising cost of operations, including paratransit
2010 transit budget challenges
Global financial crisis impacts state & local funding ability
Aging systems require more maintenance
Page 2
Preliminary budget numbers
Operating budget, $1.3 billion
Capital budget, $0.4 billion for FY2010 Metro Matters projects
Reimbursable operating projects, $17.3 million
Page 3
Metro’s FY2010 budget process- Part 1: Operating budget
The Finance, Administration & Oversight Committee began monthly working sessions in January to resolve the projected budget shortfall
An operating budget shortfall is projected
Initial Board guidance – Start with:- No fare increase
- No increase in total local government subsidies
- Consider staffing and cost reductions
- Consider service adjustments
Page 4
Recap- FY2009 jurisdictional contributions
Page 5
$179M$535Mexcludes debt
MD MD
DC DC
VA VA
hide hide
Building the operating budget- as of January 8, 2009 starting point
Page 6
$154 million projected budget gap, 11% of total budget
– Ridership growth insufficient to offset other revenue decline, $17 million
– Baseline expenses up by $137 million – Largest increases are in contractual labor costs ($44M), energy ($13M) , pension losses ($45M) and MetroAccess ($17M)
Management’s initial proposal:– $81 million staffing and other cost reductions.
(Metro has begun eliminating positions and laying-off employees, including over 300 from administrative functions so far)
– $73 million reductions in bus, rail and paratransit service
Ridership assumptions
Mid-year FY2009 results (July through December, 2008):– Metrorail +4% actual
ridership growth, 1% above budget
– Metrobus +3% actual ridership growth, 2% above budget
– MetroAccess +21% actual ridership growth, +4% above budget
FY2010 budget assumes these actual growth rates continue
Page 7
Operating revenue summary graphic- as of 1/8/09
Page 8
Passenger revenue Non-passenger revenue
dollars in millions
Operating expense summary graphic - as of 1/8/09
dollars in millions Page 9
Progress of Board work sessions- operating budget shortfall
Page 10
Jurisdiction partner proposals- service reduction + subsidy adjustment
Page 11
The proposed cuts are part of an overall effort to reduce Metro’s $29 million budget gap for FY 2010, which begins July 1, 2009
Proposed Metrobus service cuts and adjustments discussed at the public hearings net to approximately $13.5 million of budget reductions
Proposed changes to Metrobus service in the District of Columbia:– Eliminate routes M2 and D5; alternate routes available: F14 and D6
– Minimal increase to intervals between buses during rush hours on multiple routes.
• Larger buses will expand capacity for the H6• New express service on 16th Street began March 30
Public hearings- proposed service reductions
Page 12
A total of six public hearings were held from April 13 through April 17
Two hearings were held in the District of Columbia:
– Wednesday, April 15 at Saint Francis Xavier Church, 2800 Pennsylvania Avenue, SE
– Friday, April 17 at Metro Headquarters Building, 600 Fifth Street, NW
The public hearings invited comments on the proposed FY 2010 budget and on proposed service adjustments to selected Metrobus routes
Public hearings- status report
Page 13
Metro’s FY2010 annual capital budget combines two distinct capital programs:
Metro’s FY2010 budget process- Part 2: Capital budget
Budgeted expenditures for the Metro Matters program year
Continuation of Metro’s FY2009 “Stimulus” program, federally funded by the American Recovery and Reinvestment Act
Page 14
The Metro Matters financing plan anticipated a need for issuing long-term debt – Metro intends to issue bonds this spring, subject to Board approval
The debt issued will be used to fund prior year capital expenditures which to date have been funded through the commercial paper program
Metro Matters
FY2005 through FY2010 program proceeding in accordance with the Metro Matters Funding Agreement
FY2010 budgeted capital expenditures for the year are $487 million
All jurisdictional contributions are occurring on budget and on schedule
Page 15
FY10 Metro Matters budget development - use of funds summary
Page 16
FY10 Metro Matters budget development - source of funds summary
Page 17
FY10 Metro Matters budget development - summary debt strategy
Page 18
Pending receipt of formal direction, the District has indicated it will decide to opt-in to the bonding program and pay its share of the debt service. A debt service amount of $12.8 million for this purpose is included in the District’s FY2010 budget
Metro Matters bonding- “opt out” provision for jurisdiction partners
The Metro Matters Funding Agreement (MMFA) provides for debt issuance as a component of the overall financing strategy
In lieu of issuing MMFA bonds, each jurisdiction has the option to pay the Authority its share of the proposed bond issuance amount, i.e. the “opt out” provision
Page 19
American Recovery & Reinvestment Act- $202M allocation to Metro
Metro’s focus is regional and benefits accrue to each of our jurisdictional partners
Page 20
Project Categories (dollars in millions)
Metro’s “Stimulus” program- spending continues into FY2010
DC highlights– New fare media sales center at Metro Center
– Upgrades to SmarTrip machines at DC Metrorail stations
– Red Line work between Rhode Island Avenue and Judiciary Square
– Expand the chemical detection system and buy emergency evacuation carts for DC Metrorail stations
– Increase security at our Bladensburg bus facility, and rehabilitate rest rooms at both the Bladensburg and Western garages
Page 21
Action plan:– Prioritize capital needs inventory to support Authority goals
– Determine Federal and local sources of funding, timing and amounts
– Structure arrangement for receiving non-federal funds
Beyond Metro Matters
Staff are developing options for Metro’s next capital improvement program
Discussions with external stakeholders will begin in June
Page 22
Transit Infrastructure Investment Fund- status of D.C. TIIF balances
Page 23
DC Circulator highlights:
– Over 8 million riders since inception, July 2008
– 2 new routes added in March for a total of 5 routes connecting city neighborhoods. New routes are Woodley Park-Adams Morgan-McPherson Square Metro and Union Station-Navy Yard
– Purchased 14 Van Hool 30-foot buses. All will be placed into revenue service this month.
Metro’s FY2010 budget process- Part 3: Reimbursable project budgets
DC Circulator bus = $17 million
Transportation Technology School = $334 thousand
Page 24
May 14 - Finance, Administration and Oversight Committee– FY 2010 Ridership and Revenue Update
– FY 2010 Final Budget Review
– Approve Terms of Metro Matters Bond Issue
– Approve Actions recommended as a result of Public Hearings
June 11 - Finance, Administration and Oversight Committee– Approve FY 2010 budget for referral to Board of Directors
– Closeout New York Avenue capital project (Board approval to set the final project budget and to return to the District of Columbia the residual funds)
– Closeout Navy Yard capital project (Board approval to set the final project budget and to return to the District of Columbia the residual funds)
June 25 – Board of Directors approval of the FY2010 budget
Next steps
Page 25
Appendix
Page 26
FY10 Metro Matters budget development - use of funds
Page 27
FY10Metro Matters budget development
- source of funds
Page 28
FY10 Metro Matters budget development - debt strategy