Special series: Ending 50-50 split is no salvation for MARTA
(Note: This is the second in a special series examining MARTA. Read Part 1 here. Part 3 will be posted Tuesday evening.)
Why can’t MARTA have full control over its sales-tax revenue?
Generally speaking — very generally, as we’ll see — the state limits MARTA to using just half of its sales-tax revenue to pay for operations. The rest is reserved for maintenance and capital improvements.
That restriction might have made sense back when MARTA was a growing young transit agency, but today this policy is slowly suffocating it, according to MARTA supporters who’ve been pressuring the Legislature to do away with it.
If only it were that simple. Ending the 50-50 split might make for a good lobbying slogan, but it would do very little to ease MARTA’s problems.
For starters, MARTA’s supporters seem to believe the agency is still growing and in need of capital infusions.
I made the argument Sunday, in the first installment of this series, that MARTA should put expansion plans on the shelf and focus on the system it has now. But the agency’s plans call for adding light rail along I-20 east to Lithonia, extending a “Clifton Corridor” line from Lindbergh station to Emory, creating the Peachtree Streetcar and boosting bus frequencies across the city.
More important, the current projects and the maintenance required to keep the MARTA system in a state of good repair are also costly.
In the current fiscal year, MARTA is cutting its capital budget by $180 million to about $200 million, focusing spending on safety and regulatory issues. But get this: The agency is still moving $20 million out of its precious operating reserves to shore up capital spending, says Ted Basta, MARTA’s business-services chief.
As for moving money from capital to operations, “In good times, 50-50 [flexibility] is worth a lot,” says Rich Krisak, head of rail operations. “In bad times, it’s not.”
Yet, the 50-50 clamor is of course loudest in the bad times, when MARTA goes looking for ways to plug revenue shortfalls.
In any case, the restriction itself is somewhat overblown. State law allows MARTA to borrow from its capital funding to subsidize operations anytime, as long as it repays the money within three years.
And over the past decade the Legislature has voted at least three times to ease the restriction in part or altogether. The transportation bill passed last month includes a three-year suspension of the cap, subject to certain conditions.
When the new three-year grace period ends in mid-2013, MARTA will have been totally subject to the 50-50 cap in just 18 of the preceding 138 months.
Proponents of ending the 50-50 requirement lament that MARTA is the only major transit agency in the country that doesn’t get funding from its state government. Just as problematic for MARTA’s budget, however, is that the agency historically generates only about 25 to 30 percent of its operating income from fares and related services like parking, compared to 40 to 50 percent for the industry nationwide.
Making matters worse, income from fares and other services industrywide has been growing two to three times as fast as it has at MARTA.
It’s only fair to note that MARTA had the fifth-lowest operating cost per passenger mile (45 cents) among the nation’s 20 largest transit systems in 2008. A low cost of living in Atlanta, compared with places like New York or Chicago, no doubt helps. MARTA officials also say they have held union wages flatter than their counterparts nationally have done.
But all of that strikes me as a reason to keep the 50-50 restriction and the discipline it imposes on the agency.
And one can’t compare operating expenses nationally without noting that MARTA’s cost per passenger mile has been growing much faster than that of other systems over the past decade. Among the top 20 systems, MARTA’s cost growth rate is sixth-highest. That’s a very bad thing when you’re spending money you don’t have.
Next: What’s really wrong with MARTA’s model
Previously: It’s time to end MARTA’s boom-and-bust budgeting
Tell us what you think about the site
Customer Care »
Vacation stops, manage subscriptions and more
AJC Services
Sections
Other Editions
Visitor Agreement | Privacy Statement
© 2013 The Atlanta Journal-Constitution
87 comments Add your comment
Kyle Wingfield
May 18th, 2010
11:22 am
WestsideATL is right about what I meant by progress over the past 10 years — political progress. Don’t underestimate how far they’ve come.
who dat: Do you have any idea what that kind of expansion would cost? And what kind of potential ridership figures do you have? The days of transportation planning in the way of “Man, I bet a lot of people would ride from Va-Hi to Atlantic Station, right?” are over. And when you talk in terms of NY, Paris, London, etc. you are talking about cities with much greater population density than we have.
Kyle Wingfield
May 18th, 2010
11:26 am
atlin83: You’re right, from 2002-2008 the variance was 55-45; in the next three years there will be no particular percentage required. But the point is that it doesn’t really matter: MARTA’s maintenance and capital costs are such that you could eliminate the cap forever and it wouldn’t make very much difference in terms of money for current operating expenditures.
What it does is constrain operating expense growth — chiefly salaries, since that’s by far the biggest chunk of MARTA’s operating cost (about 75 percent, per MARTA). Given the way expenses have grown in spite of the cap, it doesn’t seem very sensible to me to remove it.
Kyle Wingfield
May 18th, 2010
11:37 am
Port O’John: FL and NC actually voted for Obama, but that’s neither here nor there
I think you will see GRTA or a new regional authority for the ARC area become the umbrella organization for purposes of federal funding, interagency coordination, etc. That problem is pretty easily solved.
The real debates, as you suggest, will be about which types of projects get the most bang for the buck. Almost certainly, a great deal of the new money will go to road/highway improvements, because you could spend $100 billion on transit in Atlanta and most people would still get around by car. Next, you will probably see some Bus Rapid Transit projects, because BRT costs a fraction of what even light rail costs, much less heavy rail or commuter rail.
After that, who knows? But at the end of the day, we are still talking about limited funds, and it’s absolutely imperative that we do as much good as possible with that money.
Base
May 18th, 2010
12:26 pm
You have drank the GRTA kool-aid “BRT costs a fraction of light rail”.Your series is nothing but a propaganda piece for GRTA and BRT/express bus.
who dat
May 18th, 2010
12:28 pm
I don’t know the costs as well as you do, most likely. I am merely pointing out that there are a lot of people who live in Atlanta and/or spend a lot of time in Atlanta who don’t use transit now but would gladly use transit if transit saved them time. MARTA’s ridership would increase exponentially if people could get wherever they needed to go within the city in a timely manner, and by extension that is the only way they can ever expect to increase revenues substantially in light of the fact that state government does not wish to support them. On the other hand, it’s incredibly unlikely that if they expand further away from the city they will reap as big of an increase in revenues, since the resulting train ride for those suburbanites probably won’t save them time over driving. Whether those increased revenues translate to increased profits or not, either now or in the future, is something you and other bloggers here probably know more about than me.
As far as population density goes, what was the density in New York and Boston when their train systems were beginning to be built around the turn of the century?
who dat
May 18th, 2010
12:41 pm
And whether this increased connectivity takes place under MARTA’s umbrella, as heavy rail, light rail, or BRT is not really relevant. If it takes the same amount of time or less time than driving, people will use it. But whoever runs Atlanta’s transit, whatever modes of transport they use, is never going to break even with the current level of connectivity.
CJ
May 18th, 2010
12:45 pm
In addition to the 50-50 split, Governor Perdue recently signed HB 277 into law which would allow voters to approve a 1 percent sales tax to fund specified regional transportation projects. However, MARTA is the only transit agency (among over 100) not able to use the revenue from such additional revenues to fund current operations. The only justification I’ve found for this limitation comes from a Perdue spokesperson referencing the need to watch out for the interests of “people in suburbs” and “rural folks as well.” Nice.
In addition, state lawmakers recently reorganized MARTA’s Board of Directors such that it has fewer members and such that three of the voting members would be appointed by, respectively, the Governor, the Lieutenant Governor, and the Speaker—essentially handing the state even more influence over MARTA operations.
In short, Kyle’s post and subsequent remarks seems to miss the point made by many that such strategic and operating decisions (e.g., 50-50 split) should be made exclusively by MARTA and its regional benefactors, not lawmakers from places such as Perry, Gainesville, and Ellijay.
Given that the state provides no funding to MARTA, is there reasonable justification for state lawmakers asserting their authority over MARTA at all? If so, I’d love to hear it.
toon
May 18th, 2010
12:49 pm
i don’t think time is the only factor in how well its used… also convience… people arent going to want to change from a bus to a train to a bus to get where they are going… too much of a hassle… they are going to want to get on the train and then get off at a station pretty close to where they are wanting to go… the surbs will use mass transit if its there… it would save them a long drive into work where they are stuck in traffic most of the time (which is why any effective transit option has to be seperate from the roads which are subject to the gridlock)… and even if they didnt save a lot of time, even 10-15 minutes longer commuter wouldnt bother the surburbs because they arent the one stressing with traffic (nice time to sleep, read, work, etc)… but you dont put a stop in every little surburb… you hit the major ones and then put a majority of the stops ITP… like on the west side you go out as far as Douglasville/Hiram but then only have 1/2 more stops before connecting to HE Holmes
Scott
May 18th, 2010
1:05 pm
Everyone seems to forget that there is a very comprehensive plan called Concept 3. I agree that MARTA (the name not the agency) might not be the one to promote in legislation. But before we all forget some recent history heres a refresher. Roy Barnes set up GRTA as a “super agency” that would have yes/no power to decide what projects got funded. Had this been allowed to continue I dont think we would be in the mess we are in today. Someone has to be able to stand up to or rise above the politics and do whats best for the region. Sonny promptly gutted the agency which I think was one of the most moronic things he has done in his 8 years (and boy there is a long list of those to chose from). I think another part of this thats not been mentioned is the Jan Jones hissy fit about having North Fulton completely over represented on the MARTA board. This was in retaliation to democrats that would not back Milton County (speaking of moronic). There is a lot that needs fixing, but whatever comes to be has to be elevated to be beyond the political pressures of the legislature…a very large task
John
May 18th, 2010
1:22 pm
I think who dat raises some valid points. Expanding MARTA outward along existing lines will canniblize traffic from the current end points (example, Chamblee stop versus Doraville) and not actually raise ridership all that much. Building inward would provide service to areas people from the suburbs can’t currently reach.
DannyX
May 18th, 2010
1:23 pm
It will be interesting to see the project list for new one cent sales tax.
It looks like Fulton and DeKalb will continue with their one cent MARTA tax. DeKalb and Fulton will also help pay for transit systems in the suburbs as part of the new one cent regional sales tax.
The MARTA tax will fund the stations the suburban systems will feed into, The Georgia Dome, Philips Arena, airport, Braves shuttle and so on. The regional tax will fund none of this.
Why would anyone from Fulton or DeKalb vote for this plan in the first place? Sounds like a setup to me.
Don
May 18th, 2010
1:24 pm
Part of the problem with MARTA is their management does not move very quickly. The Breeze card system took forever to implement and, now, over a year after full implementation, they still haven’t implemented zone or O/D pair pricing. That’s a LONG time to go without deriving much benefit from such a fancy farecard system. BART in SF, (their version of MARTA – a heavy rail rapid transit system), charges $8.10 to go from the airport to the city. MARC in Baltimore charges $4.00, SEPTA in Philadelphia charges $5.00 on their commuter rail lines. New Jersey Transit charges $15.00 for a ride from Newark Airport to Manhattan. All of their contemporaries, BART, DC Metro, PATCO, etc. have had such pricing long ago. What is MARTA waiting for, the next coming?
Kyle Wingfield
May 18th, 2010
1:40 pm
Base: Given the infrastructure that light rail requires, and that BRT does not, how would you expect anything different?
Kyle Wingfield
May 18th, 2010
1:44 pm
DannyX: There will have to be some kind of distance-based or otherwise differentiated pricing which allows for some portion of the fares to go to MARTA. And there likely will be non-transit improvements (I-20 interchanges downtown, 400-285 interchange, etc.) that will benefit Fulton and DeKalb.
All that said, I think the political process in the Legislature to get to this point will look like child’s play compared to the process going forward. Putting together that project list — and selling it — will be hard work.
Kyle Wingfield
May 18th, 2010
1:45 pm
Agree, Don, I can’t recall a transit system in the U.S. or Europe that charged the same amount to go to the airport as anywhere else.
Kyle Wingfield
May 18th, 2010
1:51 pm
As “everywhere else,” I probably should have written.
ATLBadger
May 18th, 2010
1:56 pm
Kyle – CTA (Chicago) charges the same to get from O’Hare or Midway to get to the Loop as any other segment on their system. I also believe in Boston you can get from the airport to downtown without an extra fee (granted the airport is very close to downtown). Not saying it’s the right thing to do, but we aren’t alone. Also have to keep in mind who rides to the airport besides business and pleasure travelers: a whole lot of low wage service workers. If they significantly increase cost to get to the airport, the airport and it’s vendors might have to figure out a way to subsidize employee transit passes.
joan1
May 18th, 2010
2:27 pm
Marta officials don’t even have sense enough to paint the signs in white on black, instead white on faded orange–and then, they place them where you have to be a contortionist to tell which station you are in.
Dan
May 18th, 2010
2:55 pm
Martas problem is it needs to expand, its servicable market is too small. But it needs to do so wisely, expanding bus routes with around the suburbs and housing areas is a waste of money (4-5 people on a bus doesn’t work AND it slows traffic) For a transit system to work it has to bring people from where they are to where they want to go in large numbers. Atlantas problem is population density, any city that is used as a litmus test has 10 times the density of atlanta not to mention parking spaces that go for $500/month providing incentive
Hobo
May 18th, 2010
3:27 pm
Kyle,
I am still looking for your source that says public transportation nationwide, specifically heay rail systems are 40% to 50% funded by the farebox. Still comparing apples and oranges.
Kyle Wingfield
May 18th, 2010
3:52 pm
Hobo, see my 11:11 a.m.
rdh
May 18th, 2010
4:57 pm
Divide MARTA’s deficit by their ridership, and you get a fare increase of 80 cents per ride.
Problem solved.
IF the state has to start kicking in money, Dekalb and Fulton must relinquish MOST of the control of MARTA. Otherwise, we get a “Grady Hospital” situation where mismanagement rules the day until someone responsible takes over. Further, when the state or some overseeing committee designated by the state, does take over, we will hear cries of “racism” every time a route is cut or a new route is added or a fare increase is proposed.
The rest of metro Atlanta does not want Marta. Our “hub and spoke” geometry makes it difficult to get from one part of the “rim” to another part of the “rim” without making a trip to the hub. To put this in practical terms: I worked for a fortune 500 company down off of Ashford Dunwoody. Our fellow employees from India would come to train at our center, and they stayed in one of the hotels over on Chamblee Dunwoody… about 1.5 miles away. There are no direct side streets between the two exits… one MUST get a car or take public transport. These guys were here for 3-6 month stints. Our company would pay for public transport but not car rental. When they got here, they would pool their personal money and rent the cheapest car possible. Remember, for Indians, this was really expensive. Why did they do it? Because the ride 1.5 mile ride from one exit to the next involved a 15-20 mile, 2 hour ride with bus change through Atlanta. There were no direct routes!. Want to go from Doraville to Roswell? You have the same problem. MARTA works best for people who live and work in the inner city, and for people traveling into Atlanta and back out along one route. It does NOT work well for people who need to get from one part of 285 to another. The people in Roswell or Alpharetta or Sandy Springs are less served than the people in midtown…. and you want someone from Lawrenceville or Kennesaw to be taxed for the kind of service that Alpharetta gets? It is not going to happen. PERIOD. Look what has happened to North Fulton. Tired of being the “piggy bank” for South Fulton interests, residents finally had to band together and form their own cities to address their own concerns. The same thing would be true with a regional public transport. The folks in Gwinnett and Cobb now have MORE people than Atlanta. There is no way that you can justify providing less comprehensive service for someone in Buford than someone in midtown if both are getting taxed at the same rate. Once again, this pits the interests of the northern counties against the interests of downtown, and cries of “Racial Discrimination” are already ringing in my ears. The best way to avoid those cries is to not join MARTA in the first place. Of course, that brings its own cries of racial discrimination, but at least the people of those counties aren’t taxed for a service that will likely never be comprehensive enough for their use.
rdh
May 18th, 2010
5:09 pm
BTW, this is been the most civil discussion I have seen in a LONG time in the Opinion section. It tells me that everyone wants mass transit to work in Atlanta Metro, but it is a daunting task with no answers. No one wants to commit the kind of money that this project needs to succeed without 100% assurance that it will succeed. I, for example, want to know how I can get from McFarland Rd to Marietta (delk road) in less than 1 hour on any proposed public transportation. Frankly, I don’t see it. And if I can’t see it happening, I won’t vote for it and I don’t want to pay for it.
Scott
May 18th, 2010
5:33 pm
rdh, I dont have children and I dont particularly like some aspects of the public school system, but I have to pay taxes which go to them. We cannot micromanage how our taxes are dispersed only show our displeasure at the polls, but I think its time for us to look outside of the “where’s mine” mentality. It might not help you get from point a to point b, but it might bring new customers to a business, new hiring opportunities to employers, and it just might take enough cars off the road so that your trip becomes that much shorter than an hours time
rdh
May 18th, 2010
5:51 pm
Scott,
First, you can’t compare public education with public transportation. It is apples and oranges. In terms of the “where’s mine” mentality, this applies. If you cannot show me and the other 1.5 million people in Cobb and Gwinnett that it is ABSOLUTELY 100% GUARANTEED going to make our lives better, then you lose the argument. PERIOD. So far, the MARTA advocates have lost the argument. What MARTA advocates don’t understand is that this is not up for debate. I , and the other 1.5 million people like me, won’t accept that it “might” reduce crowding on the roads even if it doesn’t go where I want to go. MARTA proponents have to make a better case than “might”.
Special series: MARTA put itself in red before recession hit | Kyle Wingfield
May 18th, 2010
6:53 pm
[...] This is the third in a special series examining MARTA. Read Part 1 here and Part 2 here. The final part will be posted Wednesday [...]
Algonquin j. Calhoun
May 18th, 2010
7:12 pm
Well, I see another Republican is resigning due to his having had an affair. That’s not at all unusual but some of the circumstances are-it was a heterosexual relationship!
DEWSTARPATH
May 19th, 2010
7:05 am
- I agree with NotRocketScience at the start of this forum –
that MARTA needs to change its name primarily to deal
with the marketing stigmatism over its ridership.
And to be fiscally solvent as well, it needs to look towards
new management – the cost of implementing the Breeze
card system was not justified in the middle of its operating
budget crisis, despite the refusal of the legislature to help
provide funding comparable to other mass-transit systems
in other U.S. cities.
Hobo
May 19th, 2010
8:33 am
Kyle,
You are still comparing apples and oranges. MARTA ranked 7th in farebox recovery at 27.5% in FY2008 within a peer group of 19 heavy rail transit systems. The average farebox recovery is 29.15%, not 40%-50%.
Check it out.
http://www.itsmarta.com/uploadedFiles/News_And_Events/Public_Hearings_and_Meetings/Effectiveness%20and%20Efficiency%20Brochure.pdf
Hobo
May 19th, 2010
8:54 am
Kyle,
The link in my previous has some very impressive statistics regarding MARTA’s operational efficiancy, cost effectiveness etc… Please read it and keep an open mind.
I Report/You Decide
May 19th, 2010
10:46 am
toon @ 10:03AM…
” report… you need to cite your sources too… according to the AAA its an average of 70.7 cents per mile (for up to 10,000 miles a year, which is equivalent to a 38 mile round trip commute each day)”
Sorry, I don’t need a source. I do my own math. My $30,000 SUV, straight-line depreciated over 10 years, equals $3,000 per year. Add to that another $1,000 for insurance, tag fees, and ad valorem tax, so $4,000 per year. Divide that by 20,000 miles driven per year, my cost there is 20 cents per mile.
At 15mpg and $2.75 per gallon for regular unleaded, my fuel cost is 2.75/15 = 18.33 cents per mile. Add that to the 20 cents from above, now we’re at 38.33 cents per mile. Throw in another 7 cents per mile to cover repairs and maintenance, so voila…45 cents per passenger mile. And that’s only if I ALWAYS ride alone and never carry my wife or child.
Now I’m sure there’s Atlantans woh drive Benz/BMW or whatever and spend more than me, but there’s also people who buy used Civics or Accords that cost ess, depreciate less, and use less fuel, so they no doubt spend LESS than 45 cents per mile.
In summary, mass transit that bills itself as an efficient use of resources and tax dollars, but costs 45 cents per passenger mile, is an absolute JOKE.
I Report/You Decide
May 19th, 2010
10:51 am
Oh, and I almost forgot…my privately owned SUV, that is just as efficient as MARTA from a cost perspective, is also, clean air-conditioned, faster, more convenient, and I don’t have to ride with bums, panhandlers, thugs, and people who don’t bathe.
Kyle Wingfield
May 19th, 2010
11:04 am
Hobo: I specifically said “…from fares and related services like parking…” (emphasis added), and the report I referenced includes both.
Trust me when I say that I’ve read more MARTA documents over the past month than is probably healthy…
Hobo
May 19th, 2010
1:04 pm
Kyle,
I wish more people would read the data for themselves rather than be led down the proverbial primrose path. Instead of sleepwalking, people need to wake to world around them. Arm themselves with knowledge. Make their own decisions. Take responsibility for their own actions. Agree to disagree and get on with business. We have to iron out some sort of workable solution (read compromise). If we don’t, we are leaving another horrible mess for our children to clean up.
Thanks for the platform. I’ll continue reading. BTW, Very civil blog.
Special series: A lesson on frugality for MARTA from out West | Kyle Wingfield
May 19th, 2010
7:16 pm
[...] This concludes a special series examining MARTA. Read Part 1 here, Part 2 here or Part 3 [...]
Racial reasoning on MARTA is off-track | Kyle Wingfield
May 27th, 2010
5:00 pm
[...] my recent series of columns about MARTA, several readers suggested that the biggest obstacle for MARTA is a racial [...]
Soapbox: Privatizing MARTA makes no sense | Fresh Loaf
June 4th, 2010
11:03 am
[...] May, the AJC’s Kyle Wingfield penned a multi-part opinion series about MARTA’s financial woes. One possible solution the conservative columnist [...]