Well, well: What’s this about a $50 million problem at MARTA?

This morning’s big AJC headline — in the print edition, it read “Audit: MARTA spends $50 million too much” — was one of the least surprising things I’ve ever read in our paper.

Not because of some anti-MARTA bias on my part. Rather, it’s because MARTA officials told me as much, almost 2.5 years ago.

In the first part of my special series on MARTA back in May 2010, I wrote:

As you may have heard, MARTA now faces a $120 million budget hole. Believe it or not, the agency projected as early as in 2006 that it would be short $60 million by now, even though revenues were forecast to rise for a decade. Problem was, expenses piled up even faster.

One might summarize the financial history of MARTA (and most public entities) this way:

The economy takes a turn for the worse; MARTA’s budget, which already assumed some operating losses, goes from tenuous to disastrous. Officials warn of (take your pick) drastic, draconian, devastating service cuts unless someone, anyone, finds $50 million in new annual funding. Because the economy has also hit state and local governments, no new money materializes. Service is cut and employees laid off by the hundreds.

The economy takes a turn for the better; MARTA’s losses don’t disappear but do shrink. Still, no new $50 million. Yet the agency restores service and reinstates jobs by the hundreds. Sales tax revenues rise, but expenses rise faster.

The economy takes a turn for the worse ….

In part 3, I wrote:

[B]y mid-2008, when the fiscal 2009 budget was approved, MARTA knew things were getting bad. Its sales-tax forecasts had already been revised downward by $24 million (in reality, shoppers would deliver $54 million less than that).

So, what did the agency do? It planned to boost spending even as revenue declined — to make 2009 the third straight year in which spending growth would outpace revenue growth. And it planned to do the same in 2010.

Even before the bottom fell out, then, MARTA planned to run a $44 million deficit in 2009 and expected to lose another $49 million in 2010. That was the optimistic scenario.

Now, what do we learn from the audit by KPMG? As the AJC reports:

MARTA is spending $50 million above the national average for employee benefits, but if it revamped its health care, retirement and worker compensation plans, it could erase a projected $33 million operating deficit, an audit released Monday reveals.

The story goes on to say KPMG recommended that MARTA outsource a number of functions to private companies in order to save millions of dollars a year. My conclusion was that MARTA should privatize its entire bus operation, which is a more far-reaching proposal than KPMG made. But the principle is similar, and the reason — that persistent $50 million gap — is exactly the same.

Of course, there was nothing prescient about my writing these things back in 2010. Nor anything particularly investigative. All I had to do was ask: MARTA already knew what the problem was.

– By Kyle Wingfield

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85 comments Add your comment

MANGLER

September 25th, 2012
10:36 am

Well the head of MARTA was only making $315k+bennies. If we paid more, we’d get better results!
(which must be why she’s moving to Boston and taking a 30% pay cut)

Class of '98

September 25th, 2012
10:39 am

Congrats on your 40 under 40 recognition at Sanford, Kyle. Sic em.

BW

September 25th, 2012
10:49 am

Kyle

Why doesn’t the state just take MARTA over and privatize most functions? Does the state actually want MARTA to succeed? If spending is the only issue here, I see it as easily rectified. Does MARTA need to reduce spending? Absolutely and I’m not arguing that it doesn’t but I am arguing that the state has shown no inclination to allow MARTA to meet its mission statement which “is to strengthen communities, advance economic competitiveness and respect the environment by providing a safe and customer-focused regional transit system.”

Don't Tread

September 25th, 2012
10:54 am

Hardly surprising…

Privatizing MARTA would at least ensure the deadbeats are run out of there and there would at least be half a chanvce that the replacement staff would be hired based on merit. (It’s funny how things suddenly run well when employees are selected based on merit.)

Natasha

September 25th, 2012
10:56 am

So how much did MARTA pay to have KPMG come in and tell them what everyone already knew?

iggy

September 25th, 2012
11:10 am

Seems absenteeism is a major Marta problem. No surprise here.

TBone

September 25th, 2012
11:11 am

$50 million sounds low. I thought MARTA would do their usual trick and raise fares to make up the shortfall; that way they would attract more riders???

Kyle Wingfield

September 25th, 2012
11:20 am

Thanks, ‘98.

Finn McCool (The System isn't Broken; It's Fixed)

September 25th, 2012
11:28 am

MARTA is spending $50 million above the national average for employee benefits, but if it revamped its health care, retirement and worker compensation plans, it could erase a projected $33 million operating deficit, an audit released Monday reveals.

Always take it out on the employees, right?

Remember, benefits should be considered as salary. When you negotiate your employment, the employer is saying “we will pay you this much in wages and this much in deferred compensation/benefits.”

Maybe as employees we just need to say “you promise that compensation that I will never see so i am going to promise you this level of work from me that you won’t actually get.”

Finn McCool (The System isn't Broken; It's Fixed)

September 25th, 2012
11:31 am

Well the head of MARTA was only making $315k+bennies

How can you people sit in judgement of what someone else earns in salary? There’s your wealth envy!

How would you like for your salary to get out and people say “Dang, I’ve seen Mangler’s work and he isn’t worth that. He must have pictures of somebody”

Dusty

September 25th, 2012
11:33 am

Well, Kyle, your foresight was so good that nobody paid any attention. Now it is a headline for the AJC. Only took someone else to tell AJC after three years! Yeah, they are right “on the ball”. MARTA is wasting money. Big new news!!

I guess we wil have to wait three years before we get a headline announcing that an investigation has shown that Obama is raising our debt every day in the outstanding trillions. If he is re-elected it wil be in the quadrillions! Now that’s a nice new number Americans can expect while they live in tent cities for the foreclosed homeless. Attention, AJC! There is a problem!!! Quadrillions!!

Finn McCool (The System isn't Broken; It's Fixed)

September 25th, 2012
11:33 am

(which must be why she’s moving to Boston and taking a 30% pay cut)

That just goes to show that money isn’t everything – especially when you find yourself working for a bunch of asshats.

Dusty

September 25th, 2012
11:35 am

I wouldn’t pay Finn a dime…

Auntie Christ

September 25th, 2012
11:47 am

Here are a few suggestions:
1. Have the south georgia/exurban politicians at the capitol get their greedy hands out of MARTA’s funds. They contribute nothing to MARTA, yet control 50% of it’s gross revenues.
2. The exurbanites feel they should not contribute to MARTA thru state taxes, and that’s a valid point. By the same token, why should I, as a ITP resident pay for highway improvements in Duluth, Alpharetta, Mayretta, and podunk south georgia, through higher taxes on gasoline at the fed and state level. While this is a sales tax and I pay based on the miles I drive and efficiency of my vehicle, most of therevenues are spent in areas where I don’t drive. Furthermore, these excise taxes are not covering the total costs to keep up the interstates the exurbanites and rural residents require for commuting, requiring me to subsidize their transportation needs. From Wikipedia:
“During 2008 the highway trust fund required support of $8 billion from general revenue funds to cover a shortage. This shortage was due to lower gas consumption as a result of the recession and higher gas prices. Further transfers of $7 billion and $19.5 billion were made in 2009 and 2010 respectively.”
The state government contributes nada to MARTA’s operations. MARTA should be receiving support from the state highway fund, however CW Mathews has more sway with our esteemed legislators, and cannot make money from thois proposition, so this will never happen.

Finn McCool (The System isn't Broken; It's Fixed)

September 25th, 2012
11:56 am

Companies with offices downtown need to give employees incentives to use mass transit.

Dumb and Dumber

September 25th, 2012
11:59 am

Kyle never misses a chances to criticize transit; its interesting that GDOT with its “ENRON-style accounting” always seems to get a pass though.

(1) KPMG is hardly a reliable source — just google its recent practices (paying $80 million in fines and giving certain funds a much higher rating in return for “consideration”) hardly an example of unbiased, professional accounting; and

(2) Its interesting how privatization is always the answer to every government expenditure. Atlanta has had great success in privatizing parking enforcement. Although rewarding a private company for the number of tickets they write, regardless of whether there was a violation, isn’t so good for small businesses. I’ve no problem with paying to park, but when you get a ticked even when you pay and then have to go to court to get it dismissed (I’m two for two on that score) over a $25 fine — I’ll stop patronizing those businesses and go to Decatur or unincorporated DeKalb.

I know, y’all will say that government will have to do a better job of overseeing contractors; however after a few years of cutting employees at local governments, who is going to actually do this? I know, have a contractor oversee the contractor and then hire a contractor to oversee that contractor.

Should MARTA fire employees with absenteeism? Should it hire contractors to run certain routes, sure?

But should GRTA run a bus route that directly competes with routes by Cobb, Gwinnett and MARTA? No. But you never hear a conservative criticize that practice. That taxpayer-funded transit agencies should directly compete with each other is plain stupid, but its more fun to trash MARTA than the GOP-run GRTA.

Dusty

September 25th, 2012
12:02 pm

Aunti Christ

You have made it clear that you are a city slicker and everybody outside of Atlanta is a country hick.

Until you start thinking of Georgia s a whole state instead of Atlanta as the castle and compass to direct all, you won’t help solve the problem.

The MARTA “problem” has been diagnosed and designated. It is waste and poor management. Get it? WASTE & POOR MANAGEMENT within MARTA.

Dumping ciritcism on the far points of Georgia will not help MARTA. Might make you feel better but it will not help transportation one bit. We have a lovely state. Appreciate all of it!

Centrist

September 25th, 2012
12:05 pm

MARTA and the airport are Atlanta’s biggest slush funds for politicians to get rich and buy votes. NOTHING is going to change that.

Dusty

September 25th, 2012
12:07 pm

Finn

Big companies are already using incentives to encourage the use of MARTA.

AT & T even has a parking garage near the train station in some parts of Atlanta.

Sallie

September 25th, 2012
12:14 pm

it is what it is

Dusty

September 25th, 2012
12:16 pm

Dumb & Dumber

GRTA is run by the GOP?? Really? Do they give discounts to Republicans? Maybe I will take a ride out that way just to see the scenery!

How about that? GOP runs GRTA while Democrats cry for trolly cars. You just never know!!

iggy

September 25th, 2012
12:16 pm

Agreed Dusty. This is the State of Georgia NOT the State of Atlanta.

iggy

September 25th, 2012
12:20 pm

“The state government contributes nada to MARTA’s operations. MARTA should be receiving support from the state highway fund”

Perhaps after Marta gets their financial house in order that may be appropriate. For now…NOPE!

cc

September 25th, 2012
12:25 pm

MARTA, like everything else connected with the City of Atlanta, is a “Jobs Program” attempting to deliver too much service to too few users. There will be no improvement in MARTA until the politicians have their hands forcibly removed from the cookie jar. Anyone care to wager when that might be?

Kyle Wingfield

September 25th, 2012
12:30 pm

Cheesy: That wild-eyed screed belongs on the previous thread, not this one.

Class of '98

September 25th, 2012
12:50 pm

Kyle, don’t you think if this country is ready for a black President, it’s also ready for a Gurley Heisman?!?! go dawgs

Auntie Christ

September 25th, 2012
12:53 pm

Dusty
September 25th, 2012
12:02 pm

The MARTA “problem” has been diagnosed and designated. It is waste and poor management. Get it? WASTE & POOR MANAGEMENT within MARTA.
******************************************************************************

The waste and poor management here is the waste of your time commenting on things you know nothing about the waste of anyone’s time reading it, and poor management of you intellect by letting ’sources’ like wingfield and other Atlanta/MARTA bashers be your source of misinformation. Get it? WASTE & POOR MANAGEMENT is a fantasy feeding the prejudices of you, wingfield’s and others who conjure images of corruption and ineptitude because they despise any hint of success by the liberals ITP. And this applies to the politicians from podunk who do their level best to see MARTA fail, so they can get their good ole boy, corrupt greedy hands into the revenue pie and divvy up the benefits to their cronies.

AJC OPINION Wednesday, June 9, 2010, By Michael W. Tyler

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.
________________________________________________________

But don’t let facts get in your and the other know-nothings’ way of bashing Atlanta and MARTA, even tho you wouldn’t know mass transit from Mass achusetts.

ByteMe - Got ilk?

September 25th, 2012
12:55 pm

My conclusion was that MARTA should privatize its entire bus operation, which is a more far-reaching proposal than KPMG made. But the principle is similar, and the reason — that persistent $50 million gap — is exactly the same.

But that just puts a band-aid on the problem instead of fixing it.

The problem is this: is MARTA the regional transit backbone for the Atlanta area or a Fulton/Dekalb system that is only a minor part of a regional transportation solution? This isn’t MARTA’s fault. It’s the state legislature’s fault for requiring MARTA to stay locked to two counties while Atlanta long ago grew past those boundaries. If you limit MARTA to two counties, then you might as well keep shrinking it by getting rid of bus service. If you make MARTA part of a regional solution, then it’s time for the legislature to create an agency that will take control of MARTA and all Atlanta regional transportation assets, and let that agency have taxing power and elected board members that are responsible to the voters from the region.

But you knew that, Kyle. We’ve discussed this before.

iggy

September 25th, 2012
1:09 pm

Marta is another loser debacle just as the once shining star of the South, Atlanta. Atlanta has peaked. The best times are now behind Atlanta. Its all down hill from here.

Tryanon

September 25th, 2012
1:10 pm

I’ve ridden MARTA every work day for almost five years. In that time the customer service levels has decreased by two-thirds and the fare has more than doubled. Any salaries going to those who think this is quality management are just fooling themselves.

Additionally, while reading Board minutes a while back, I learn that MARTA will be spending $17 million on some kind of trolley system to take tourists to Centennial Park and Auburn Avenue. If this was a good idea, private enterprise would be all over it. With it’s financial problems, MARTA has no business spending this money.

iggy

September 25th, 2012
1:12 pm

BTW, Atlanta was just voted in as one of the dirtiest citys in the USA. No doubt the rolling outhouses, supplied by Marta, were a contributing factor.

Finn McCool (The System isn't Broken; It's Fixed)

September 25th, 2012
1:15 pm

Which cities offer examples of privatized mass transit?

iggy

September 25th, 2012
1:21 pm

Perhaps its time to privatize mass transit as it would decidedly be an improvement and assist in removing the typical “deadwood” that comes along with the public sector.

An Observer

September 25th, 2012
1:29 pm

The question is will MARTA do anything with the results of the audit they paid for? I have my doubts based on their past history. Some initiative by MARTA to bring costs under control is necessary if it ever expects to receive support from the community in another T-SPLOST type vote.

Li'l Aynie

September 25th, 2012
1:31 pm

Delighted, aren’t you Kyle? It just goes to show anything run by a lot of black people can’t be good.
Now, let’s gid those black people out of the White House!

Anyhow, we’d rather all those people who ride MARTA switch to driving big, ugly, top-heavy, pollution-spewing vehicles to clog our streets and freeways and make the air we breathe dirtier.

BW

September 25th, 2012
1:34 pm

Kyle

I again ask…does this state care for MARTA to succeed or use it as a punching bag? Does this state fundamentally believe in MARTA? If spending is the PRIMARY issue, then the state could contribute funds and take it over outright and cut spending and even raise fares to attempt to make it a break-even operation. A relatively easy operation in my eyes. What are you advocating FOR in terms of making MARTA sustainable in the long-term?

stands for decibels

September 25th, 2012
1:38 pm

Perhaps its time to privatize mass transit as it would decidedly be an improvement and assist in removing the typical “deadwood” that comes along with the public sector.

you know, like they do all over the world!

oh, wait.

nelson

September 25th, 2012
1:42 pm

The Governor should ask the current administration in Washington to send some “Obama Dollars” they spend like any other money only they come from the $16,000,000,000,000 deficit.

wallbanger

September 25th, 2012
1:55 pm

I have ridden Marta a number of times and have always been unimpressed. The signage is white on faded orange, and placed where you can’t see the stop from the windows, the floors are invariably nasty, you generally are “held up” one or more times on the way to anywhere, there are trash talking people, and bums soliciting regularly. No surprise that Marta is used as a cash cow by the same kind of people who run city governments in many cities. It does look like it is run by blacks and for blacks.

iggy

September 25th, 2012
1:57 pm

“you know, like they do all over the world!
oh, wait.”

Atlanta is such an innovative city, so cutting-edge and all that other non-sense bellowed by Mayor Yellow Teeth and his cohorts. Perhaps Atlanta could be the leader, in something other than shameful behavior and give privatization a try. No, that wouldnt work as probably would be necessary to terminate approx 30% – 40% of the lazy workers and we can have that…

iggy

September 25th, 2012
2:02 pm

@@

September 25th, 2012
2:03 pm

My husband went to school with a guy who worked for MARTA.

G-o-o-o-o-od lookin’ but dumber than dirt. Lost three jobs before ending up at MARTA.

Last I heard, he was livin’ high on the “perpetual” hog…retired on some lake property.

Our new chairman, Jeff Turner wants to bring back Clayton County’s bus service but only if it’s privately operated. A black conservative running below the dem’s radar?

I can only hope.

@@

September 25th, 2012
2:05 pm

Kasim Reed has yellow teeth?

I never noticed.

JamVet

September 25th, 2012
2:10 pm

Kyle, notwithstanding your legitimate points, good luck to our gridlocked cons in their exurban hell holes!

I’ll be thinking of you (NOT!) as you slog through yet another nightmarish commute this in a few hours and then again tomorrow morning and every weekday morning and evening for the rest of your working lives!

You are truly the good little worker ants that you’ve been trained to be!

Long live road rage!

Have A Smile! ☺☻

September 25th, 2012
2:11 pm

Delighted, aren’t you Kyle? It just goes to show anything run by a lot of black people can’t be good.
Now, let’s gid those black people out of the White House!

Anyhow, we’d rather all those people who ride MARTA switch to driving big, ugly, top-heavy, pollution-spewing vehicles to clog our streets and freeways and make the air we breathe dirtier.

Congrats on attempting to play the race hard where no racism exists, and bonus points for hating on those who drive SUVs.

FAIL

I Report (-: You Whine )-: mmm, mmmm, mmmmm! Just sayin...

September 25th, 2012
2:16 pm

Hopefully they won’t appoint some goony lib to solve the “problem” because then it will become a $100 million dollar mistake.

I Report (-: You Whine )-: mmm, mmmm, mmmmm! Just sayin...

September 25th, 2012
2:17 pm

And the goony lib would have the best pension in the lot.

I Report (-: You Whine )-: mmm, mmmm, mmmmm! Just sayin...

September 25th, 2012
2:32 pm

In a series of nine stories in 1980 on “Crucial States” — battleground states as they are known today — the New York Times repeatedly told readers then-President Carter was in a close and decidedly winnable race with the former California governor. And used polling data from the New York Times/CBS polls to back up its stories.

Don’t git suckered by the clown show, this guy is toast.

iggy

September 25th, 2012
2:35 pm

“Kasim Reed has yellow teeth?
I never noticed.”

Its all those yellow crayons he has been chewing.

DebbieDoRight - The Only Thing Wrong With Capitalism is Capitalists..

September 25th, 2012
2:37 pm

My my — i’ve never seen so many cons HAPPY that people will be out of jobs before!! How very CONscientous and CONtentious of you folks! I don’t understand the out and out hatred of MARTA – I mean most cons on the blog say the don’t ride it, they don’t spend one dime on it, and they don’t care for it, so why the glee?

Its almost as if you WANT MARTA to fail, simply because it has Atlanta in its name OR because it provides transportation for poor, carless, and som3times handicapped people. Would that be the reason?

Nahhhh!!! Not these Cons!!! They are only so CONtorted with glee because they, personally, hate anything that isn’t taking tax payer money and giving it away to a personal friend of the governor’s to start a resort on Lake Lanier!

Where, as every con knows, not a dime of tax money will be misspent, misappropriated, OR abused!!! They’re absolutely CONvinced of that! :roll: