Regional Alliance For Transit
1000 Union Street, Suite 207
San Francisco, California 94133
May 19, 2004
Mr Steve Kinsey
Metropolitan Transportation Commission
101 Eighth Street
Oakland, CA 94607
Dear Chairman Kinsey:
The Regional Alliance For Transit is a transit advocacy organization. RAFT has two questions for your consideration regarding the Santa Clara Valley Transportation Authority:
1. Should not the recent submittal of VTA projects and programs ("VTP 2030") intended to be a part of the MTC's Regional Transportation Plan now under development (Transportation 2030, "T2030") be returned to VTA for correction? The VTP 2030 plan is not "fiscally constrained" and therefore will make MTC's own T2030 plan fiscally unconstrained, and thus not approvable by federal authorities; &
2. Should not the Silicon Valley Rapid Transit Corridor Project ("BART to San Jose") be removed from MTC's Regional Transportation Plan? Among other things, funding to build it is of questionable feasibility, according to the FTA. Additionally, the operating plan, as it stands today, apparently will violate MTC's Environmental justice responsibilities.
1. A. VTA assumes that Measure A sales tax revenues it expects to receive between 2031 and 2036, a five year period after the ending point of T2030, may be credited in its VTP 2030 plan and in MTC's T2030.
The VTA staff report entitled Final Staff Recommendations for VTP 2030 Program Allocations and Project Priorities was discussed in detail at the VTA's Board Workshop of April 23, 2004 and contains this information:
Since that meeting, staff has confirmed with MTC that all Measure A projects that can be funded within the 2005-2036 revenue projections may be submitted to MTC for inclusion in the financially constrained portion of the Regional Transportation Plan (T2030). Accordingly, staff has developed a revised project list that includes all Measure A projects, with the exception of fully funding New Rail Corridors and Zero Emission Buses.
In terms of current dollars, the extra five years of revenues is shown in the report's "Attachment A" and amounts to $1.1 billion. With this reliance on significant revenue beyond the planning period, VTP 2030 is not fiscally constrained.
Logically, if VTA is allowed to compress 30 years of a tax into a 25 year plan, what is to stop Bay Area Rapid Transit from bringing in 50 years of its property tax into the T2030? Or Golden Gate Transit 75 years of toll bridge revenues, or the Municipal Railway a century of revenue from the general fund of the City and County of San Francisco? The proper treatment is that the time horizon for revenues must equal the time horizon for the plan, here 25 years. Only in this way will the responsible federal agencies be able to approve T2030.
1. B. VTA does not appear to have included the interest costs associated with its projects in its submission to MTC. For instance, a footnote of April 23rd's Attachment A states:
(6) Measure A need for BART project is net of $649 M in TCRP funds, $834 Federal New Starts, $107 Prop. 42 STIP and $69 M in other funds. Does not assume additional bonding for construction.
The Board and staff of VTA know that at least the BART to San Jose project will require sizable borrowings to finish construction. VTA's General Manager presented the Board of Directors with Sample Plan/Major 2000 Measure A Projects & Potential Revenues, a report to accompany agenda item 18x at the Board meeting of October 2, 2003, which makes it clear that more than $1 billion would need to be borrowed to build the BART project. Interest will have to be paid on the borrowing, yet the interest incorrectly is not considered a part of the project for planning purposes. Without including the cost of interest in its submission to MTC, VTP 2030, for yet a second reason, is not fiscally constrained.
2. A. VTA is counting on $649 million in state TCRP funds. Perhaps this is one reason the Federal Transit Administration, in its February 2004 New Starts report, rated the project "Not Recommended." The project was given "low-medium" local financial commitment rating in part to reflect the:
questionable feasibility of the capital financing plan and the lack of supporting documentation submitted by the project sponsor.
RAFT considers the BART to San Jose project at best is a candidate for MTC's "Big Tent" list of projects that have insufficient committed funding to be completed. The project is not one that should be in MTC's fiscally constrained T2030 plan.
2. B. VTA's operating plan for the BART line includes a contractual "pledge" of TDA revenues of $48 million or more a year in perpetuity to BART. It is possible VTA may substitute a new funding source for the "pledge," but it did not choose to seek required voter approval for one in the General Election of 2002 and is not intending to seek approval in the upcoming General Election of 2004.
VTA uses TDA funds to operate a part of its existing bus and light rail service. It disclosed in its January 2004 draft Short Range Transit Plan (DSRTP) that the cost of its light rail operations was $51 million in FY 2003, not much more than the pledge. As VTA has not identified which mode, bus or light rail, will be reduced when the TDA pledge becomes effective, RAFT members think it is not impossible that bus service will be reduced significantly; the alternative would appear to be closing down the entire light rail system currently in operation and incidentally incurring a repayment obligation to the federal Treasury.
A reduction of bus service is a serious issue for RAFT members, since bus is the primary mode for most Environmental Justiceprotected residents. According to VTA's DSRTP:
Nearly half (45%) of all light rail riders were White/ Caucasian, whereas White/Caucasian accounted for only 30% of all VTA bus riders.
In addition to providing information on rider ethnicity, the DSRTP is informative regarding household incomes:
rider income levels also vary by mode, with light rail users reporting higher income levels than bus riders.
A chart in the DSRTP shows that 42% of light rail riders have household incomes of under $35,000; the comparable figure for bus riders is 59%.
VTA has the opportunity to identify the services it will cut to honor its "pledge" but it has not done so, just as it has not identified a substitute for the "pledge" itself. Until then, it is not unreasonable to assume that the plan for operating BART will result in cuts to bus service, which is unfair to both minority bus riders and low income bus riders.
VTA's VTP 2030 submittal to the MTC for inclusion in the T2030 RTP is not fiscally constrained and should not be accepted by the MTC. VTA still has some time to submit a fiscally constrained 25-year plan to the MTC for inclusion in T2030.
The BART to San Jose project's capital plan is questionable and its operating plan likely is contrary to Environmental justice principles MTC is obliged to follow as a recipient of federal funds. Also, as shown in (1) above, the BART project may be dependent upon some of the $1.1 billion in tax revenues expected to be received past the time horizon of T2030, and its interest costs are understated by perhaps several hundred million dollars without disclosure of how these additional costs will be paid. For these four reasons, the MTC should exclude the BART to San Jose project from T2030.