As promised, here is MARTA’s response to my series of columns about the transit agency: its perennial budgetary problems, false hope in ending the 50-50 restriction on its sales-tax revenues, out-of-control spending even before the recession hit, and one possible partial solution.
I’ll let readers judge the agency’s response for themselves without adding my own opinions here, although I will respond to readers in the comments thread.
By Michael W. Tyler
9:42 a.m. Wednesday, June 9, 2010
The Atlanta Journal-Constitution recently published a four-part series by Opinion columnist Kyle Wingfield that purported to examine the budgetary dilemma confronting MARTA and offered suggestions for future consideration that underscored some of the intricacies of running the nation’s ninth-largest transit system.
While Wingfield’s series has helped to further the dialogue regarding the future of regional transit in our state, this discussion would benefit from additional factual information.
In order to better grasp MARTA’s current plight, it is important to first understand that the financial foundation upon which MARTA was built was flawed from the very beginning.
MARTA was originally conceived as a five-county system composed of Fulton, DeKalb, Cobb, Gwinnett and Clayton. When only Fulton and DeKalb voted to join the system, the potential for more favorable economies of scale of a five-county system was lost and the agency was forced to rely on significantly less sales tax revenue than expected.
To make matters worse, unlike every other major transit system in the nation, MARTA has never received any significant, dedicated funding from the state of Georgia.
Compounding matters even further was the Legislature’s restriction that allowed MARTA to only use 50 percent of its sales tax revenues on operations while mandating that the other 50 percent be used for capital projects. Such a restriction does not apply to any other transit system nationally or in Georgia.
The conventional wisdom today is that the Legislature imposed this onerous restriction 39 years ago to ensure MARTA’s long-term expansion. But as former Atlanta Mayor Sam Massell pointed out in a March 19, 2009, AJC opinion piece (“No reason now to deny MARTA its sales tax revenue” ) segregationist Lt. Gov. Lester Maddox insisted on the restriction as a means of forcing higher fares to prevent MARTA from being overrun by those whom he deemed undesirable.
Given the tenuous funding foundation upon which MARTA was originally built, it is not surprising that the recent economic recession would have a devastating impact on its finances.
What may be surprising to many, however, is how well MARTA has actually managed its limited resources. MARTA is one of the most efficient and cost-effective transit agencies in the nation.
According to the Federal Transit Administration, MARTA spends less money per mile for bus service than any of its peer transit agencies in the country, except for Phoenix’s Valley Metro.
Similarly, at the local level, MARTA’s bus operating costs per trip are lower than those of Cobb County Transit, Gwinnett County Transit and the Georgia Regional Transportation Authority.
Moreover, contrary to popular belief, according to the Dash Report, an independent survey of transit system labor rates nationwide, MARTA’s unionized employees are among the lowest paid in the nation compared to their peers at agencies of similar size. Furthermore, MARTA’s 1.54 percent increase in the top wage rates for operators was the lowest in the entire country over the past 10 years.
These statistics highlight the fallacy behind Wingfield’s notion that MARTA could become more cost-effective through privatization. Cobb County Transit, Gwinnett County Transit and GRTA all utilize private contractors and, as noted above, have higher operating costs than MARTA.
In addition, even if MARTA did have inflated union wages, which it clearly does not, federal law requires that any private company that took over MARTA operations would be mandated to assume and maintain the union work force and the attendant collective bargaining agreement — or risk losing billions in federal funding.
A careful examination of the facts clearly shows that MARTA has responded in a fiscally responsible manner to the current economic crisis that has unfortunately wreaked havoc on every governmental institution in the state that is dependent upon sales tax revenues.
Among other things, this past fiscal year, MARTA raised fares, reduced service, withheld merit salary increases, mandated 10-day furloughs for all nonunion employees and required these employees to pay a higher share of the cost of health care benefits.
All these cost-cutting measures will continue over the course of the next fiscal year. More importantly, by the end of this month, the MARTA board of directors will adopt a balanced budget for fiscal year 2011 that will preserve as much vital service as possible, but will further reduce expenditures through the implementation of additional painful, yet necessary, service reductions.
The recent passage of the Transportation Investment Act of 2010 does not provide any immediate new revenue to MARTA.
However, it does provide a basis for MARTA, at some point in the future, to possibly obtain some much-needed additional financial support, at least for capital projects and for the operation and maintenance of new projects.
More importantly, this new legislation provides the state and the Atlanta region with a fresh opportunity to actually realize the dream of creating a truly regional transit system.
Fortunately, such a regional system can be built from the solid $6.5 billion core constructed and maintained over the course of the past 40 years by the dedicated and hard-working employees of MARTA.
Michael W. Tyler is chairman of the board at MARTA.