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Friday, August 17, 2012
The true story of Trimet-Presented by the PDX Transit Equity Coalition
Blog version of this Production is available HERE!
Really impressive video. But it doesn't square with the facts as I understand them. TriMet's current fiscal crunch isn't directly related to its rail expansion; its bonds against future payroll revenue won't cut into service for a few years. The only argument to be made here is that TriMet could have used its political capital to ask for new buses or operating grants. But the video implies it's as simple as not building rail lines.
And whatever we think of the executive salaries and pensions listed -- a totally valid topic for discussion, IMO -- they're a pittance compared to the total $14 million financial shortfall surrounding this year's cuts and hikes.
TriMet could set every C-level executive salary at $1, pass a modest property tax levy to pay for local costs of Orange Line construction, and it'd still be facing an short-term budget crunch and a catastrophic long-term collapse. That's awful news for everyone, but it's just a fact.
There are a lot of totally fair points here, but the apparently deliberate deceptions make the whole thing hard to take seriously.
Again, it's an impressive video, and I'd love to hear a counterargument.
Yes Michael it appears some liberties were taken to simplify the situation. However the point of the video that seems to ring true is that TriMet has lost it's focus on providing quality transit to our region and is focusing on development. The other important issue pointed out is the danger is having a "quasi governmental" selling bonds with basically no effective oversight. If this situation continues who will be left holding the bag?
I'm looking more into it. I think I was wrong about the Orange Line payroll tax bonds; they were scheduled to kick in this year. That'd be about $3.2 million a year, compared to $14 million in cuts/hikes -- substantial though not the whole problem.
The thing that amazes me is the steep climb in debt service costs: fy 8/9 8.5m fy 9/10 22.8m fy 10/11 25m fy 11/12 29.5 estimated fy 12/13 48.2 budgeted
How is that sustainable? Yet they have been blaming their unsustainable budget on employee health costs. I know it's simplistic but it appears to me that they have claimed a 12 -19m shortfall when they are budgeting a 19m increase in debt service cost.
So it would certainly appear that the need for service cuts and fare increases (and cuts in employee compensation) might be precipitated at least partly by increased debt service costs.
Pp. 33-36 describe various revenue bonds issued by TriMet over the years. I'm not certain whether payroll bonds went into financing the Red and Yellow lines -- my impression had been that future revenue for those bonds came from other means -- but the language of the audit suggests that payroll certainly backs them and might also be paying for them directly.
My information that TriMet had not, until the Green Line, used payroll taxes to fund the local share of rail lines came from an on-the-record interview with a TriMet budget staffer in 2010. I wouldn't be surprised if we had somehow miscommunicated.
This is an important question that I want to get nailed down.
9 comments:
Really impressive video. But it doesn't square with the facts as I understand them. TriMet's current fiscal crunch isn't directly related to its rail expansion; its bonds against future payroll revenue won't cut into service for a few years. The only argument to be made here is that TriMet could have used its political capital to ask for new buses or operating grants. But the video implies it's as simple as not building rail lines.
And whatever we think of the executive salaries and pensions listed -- a totally valid topic for discussion, IMO -- they're a pittance compared to the total $14 million financial shortfall surrounding this year's cuts and hikes.
TriMet could set every C-level executive salary at $1, pass a modest property tax levy to pay for local costs of Orange Line construction, and it'd still be facing an short-term budget crunch and a catastrophic long-term collapse. That's awful news for everyone, but it's just a fact.
There are a lot of totally fair points here, but the apparently deliberate deceptions make the whole thing hard to take seriously.
Again, it's an impressive video, and I'd love to hear a counterargument.
Well that's certainly a comment by someone who has some knowledge.
Of course I don't agree with Michael at all. I think the rail expansion is the root of all evil at Trimet
Yes Michael it appears some liberties were taken to simplify the situation. However the point of the video that seems to ring true is that TriMet has lost it's focus on providing quality transit to our region and is focusing on development. The other important issue pointed out is the danger is having a "quasi governmental" selling bonds with basically no effective oversight. If this situation continues who will be left holding the bag?
I'm looking more into it. I think I was wrong about the Orange Line payroll tax bonds; they were scheduled to kick in this year. That'd be about $3.2 million a year, compared to $14 million in cuts/hikes -- substantial though not the whole problem.
The thing that amazes me is the steep climb in debt service costs:
fy 8/9 8.5m
fy 9/10 22.8m
fy 10/11 25m
fy 11/12 29.5 estimated
fy 12/13 48.2 budgeted
How is that sustainable? Yet they have been blaming their unsustainable budget on employee health costs.
I know it's simplistic but it appears to me that they have claimed a 12 -19m shortfall when they are budgeting a 19m increase in debt service cost.
So it would certainly appear that the need for service cuts and fare increases (and cuts in employee compensation) might be precipitated at least partly by increased debt service costs.
And then there is the most articulate explanation of Trimet budget woes of all-from John Charles
JOHN CHARLES GIVES A ELABORATE DESCRIPTION OF BUDGET PROBLEM
I may owe you guys an apology. Here's the file John Charles alludes to in the video Al linked:
http://trimet.org/pdfs/publications/2011-audited-financial-statements.pdf
Pp. 33-36 describe various revenue bonds issued by TriMet over the years. I'm not certain whether payroll bonds went into financing the Red and Yellow lines -- my impression had been that future revenue for those bonds came from other means -- but the language of the audit suggests that payroll certainly backs them and might also be paying for them directly.
My information that TriMet had not, until the Green Line, used payroll taxes to fund the local share of rail lines came from an on-the-record interview with a TriMet budget staffer in 2010. I wouldn't be surprised if we had somehow miscommunicated.
This is an important question that I want to get nailed down.
Nice to see you with an open mind and on the case Michael!
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