Wednesday, June 6, 2007

Huberman/Reilly: What Were They Thinking?

Sometimes the news from the transit front just makes you scratch you head in wonder. What were these guys thinking?


The CTA has started public hearings on its plan for the fare increases and service cuts that will be necessary if the General Assembly does not fill the CTA's $226 million budget hole. Last night was the first public hearing. The Tribune reported the comments of new CTA President Ron Huberman, the CTA's new President at the first hearing:

CTA President Ron Huberman, who took office May 1, opened the hearing by saying that he hopes state lawmakers come through with extra funding so the changes won't have to be made.

"We don't want to raise fares by a penny," he told the group. "We don't want to cut one single bus route."

These statements seem incredible at a time when the General Assembly is having great difficulty in putting together a budget, the Governor threatens a veto of any sales tax increase, and there seems to be little legislative support to increase the State's support of public transit from the State's general fund.

Huberman's statement that the CTA "hopes state lawmakers come through with extra funding so changes won't have to be made" feeds into the generalized suburban suspicion that the CTA seeks a State bailout so that it can perpetuate its failed business model. That failed business model, as the Auditor General documented in his Report, includes rolling out more new service than the CTA can afford, a misplaced set capital priorities and failure to control labor costs.

In his early statements upon taking the CTA's helm Huberman signaled that he was going to be a different kind of leader, a tough talker who would carefully manage the CTA's finances. He's still new enough to enjoy the benefits of a honeymoon and thus he was positioned to take some chances. Instead, he sounded like yet another CTA apparatchik mouthing the party line that the CTA's funding problems are someone else's problems.

Huberman had the golden opportunity to say something like this:

The CTA is fighting hard to obtain more funding. If we succeed in that effort I will work hard to make sure all of that money is used to improve service. If we don't succeed we will have no choice other than implementing the painful service cuts and fare increases that we are discussing tonight.

I will tell you, however, the things cannot and will not be the same at the CTA. Even if we get more subsidies from Springfield, a fare increase will be necessary to pay for the many service improvements we have put in place in recent years. The only question is how much that fare increase will be.

Some service cuts will be necessary as well, even if we succeed in Springfield. We must put the CTA on solid financial footing. That means living within our means, after years of not doing so. I will do everything I can to minimize these cuts, but they will happen and the CTA and its customers will be better for them in the long-term. These recurring financial crises are good for no one.

It is clear that the Governor and the General Assembly expect the CTA and the other service boards to use a large measure of self-help to fix our problems before they make any major new financial commitments to the RTA, CTA, Metra and Pace. I understand and respect that. The legislature and the Governor must know that the CTA and its customers will make the necessary sacrifices to build a better, more financially sound system.

I will not sugarcoat what is necessary for you to know. I ask that you join with me in supporting the CTA system. Ride it. Give us your feedback. Get your friends and family on board.

Am I missing something or is a CTA message of "we don't want to raise fares, we don't want to cut routes" just about the most counterproductive message you can imagine at this point in the legislative cycle?

Jim Reilly

In the meantime, wily Jim Reilly, the Chairman of the RTA, was visiting the DuPage County Board trying to line up support for the RTA's funding plan, which is embodied in Amendment #2 to S.B. 572. That funding plan contemplates a tripling of the RTA sales tax rate in the collar counties, from 0.25% to 0.75%. Half of the collar county increase (i.e., 0.25%, approximately $121 million), would be dedicated to transit. The other half of the increase would be allocated to the collar counties to be spent as they wish on road and/or transit projects. DuPage County's share of this approximately $242 million collar county tax increase would be approximately $95 million.

The Daily Herald reports that the spirit of Pate Phillip was working the County Board meeting room:

Numerous suburban lawmakers fear the measure will burden their constituents and enrich the CTA, an attitude several DuPage officials shared.

“I and other board members are fairly skeptical of any plan that increases the sales tax by a half percent and then sends tens of millions of dollars to Chicago,” Legislative Committee Chairman Brien Sheahan said.

That stance certainly is unremarkable. The suburbs feel they are being asked to bail out the CTA, an urban transit system that they perceive as not benefitting the suburbs. They view the CTA riders and the City of Chicago as not doing enough to support the CTA, a perception unfortunately reinforced in a big way by Huberman's remarks discussed above. What was remarkable, however, was Reilly's response:

RTA Chairman Jim Reilly argued that the bill gives his agency more oversight concerning the CTA.

If the bill passes, “the winner is Metra. The CTA will be made whole but they’d have to swallow the fact they’ve lost control,” he said.

Say again? Throughout the Moving Beyond Congestion process the RTA has diligently tried to avoid igniting battles between the service boards or creating the impression that the effort was a zero sum game in which there would be winners and losers among the service boards.

What are the CTA and its political allies to make of Reilly's remarks? Recall that for years the RTA allocation formula for capital dollars has favored Metra. Metra's suburban rail projects get the lion's share of "enhancement" and "expansion" capital dollars in the RTA's proposed capital plan. $1.1 billion dollars of CTA capital needs were mysteriously unaccounted for in the RTA's Moving Beyond Congestion Plan.

In light of Reilly's remarks, all these things, plus the failure to remove the RTA board seat reallocation requirement from the RTA Act, now start to look more sinister. Likewise, in view of Reilly's comments the reform bill's vesting of new powers in the RTA no longer looks like a pure "good government" development. Instead, it appears to be a way to force the CTA to "lose control" of the RTA and to make Metra the "winner."

Not only are Reilly's remarks impolitic (at best), the notion that the CTA has "control" over the RTA and the region's public transit system is poppycock. The RTA currently is vested with ample budgetary oversight powers. There are only five Chicago and CTA representatives on the 13 member RTA board. These representatives obviously are not enough to push items through the RTA board. Indeed, there are not enough "Chicago" representatives to block RTA action that requires a simple majority vote. To block important RTA board actions that require a supermajority vote, the "Chicago" representatives must stick together as a bloc with not a vote to spare. And lurking in the RTA Act is the reapportionment requirement that a suburban/downstate majority in the General Assembly can someday use to drop the number of Chicago representatives down to four, when they could not even block RTA actions that require a supermajority vote.

* * *
Very disappointing performances by our two fearless leaders. The head of the CTA feeds into suburban fears of a wayward CTA while pandering to his customers. The head of the RTA feeds into Chicago fears of a suburban hijacking of a public transit system that still serves primarily the high-density urban core of this region while pandering to the RTA's suburban allies. It is almost if they were trying to build a coalition against a State bailout of their funding problems, although I'm sure that was not their intentions.


Anonymous said...

"Ummm. Afraid I can't take a bow......The RTA and Representative Hamos have been pretty upfront on how much they hope to raise through Amendment #2 to S.B. 572 and in a general sense how it will be spent... (we want to see the promise of a universal farecard emerge once again don't we!).

Do..Re..Mi..Fa..Sol..La---Nothing with kings, nothing with crowns;
Bring on the lovers, liars and clowns!

Old situations,
New complications,
Nothing portentous or polite;
Tragedy tomorrow,
Comedy tonight!

jackonthebus said...

Are you saying that Sheila Gregory, Noelle Gaffney, Wanda Taylor, and whoever else are not writing a good script for Ron? Especially when it seems that the purpose of the hearings is not to get input, but to have a pep rally to have the people affected by CTA's actions join together to pressure Springfield for a solution the Chicago pols favor?

Carole Brown has totally ignored the Auditor General's unfavorable findings, relying, instead, on the portions of the AG's report saying that transit is underfunded, there are problems with the pension plan, and there is no proof of embezzlement. Ron seems to be spending more time in Springfield lobbying than cleaning up the mess at CTA. Instead of lobbying, Ron should implement the $12 million in administrative cuts today, and also start a search for competent operating leadership.

I also find it curious that Pace hasn't publicized a Doomsday plan yet. Is it because it knows it cannot move the political landscape, while the CTA believes it can by scaring the riders?

jackonthebus said...

One should also note that the hearings were not scheduled in areas that would face massive service cuts. For instance, the only routes cut without a substitute near Sherman Park would be 48 and 59; they would also lose a couple of X routes, but the underlying local routes would remain. No routes would be affected in the immediate area of the second hearing (Logan Square). No hearings were scheduled for the far north, northwest, and southwest sides, where there would be eliminations without available substitutes. I'm shocked that there was someone at the Sherman Park hearing that complained about losing the 93 N. California/Dodge.

Hence, the crowds to which Ron was playing are not the type of people that care about inefficiency or, for the most part, lost service. They are complaining about the potential for a fare increase, which Ron said would not happen if CTA got the $110 million. However, today there was a report that Governor Populism would veto that if it were a sales tax increase.