E-mails refute BART tax claims

Proponents of a one-eighth cent sales tax increase in Santa Clara County say it will cover all the costs of running BART to San Jose - but newly uncovered e-mails show BART officials disagree.

Thousands of pages of emails between transportation officials obtained by a group opposing Measure B show that BART officials wouldn’t give assurance to the Valley Transportation Authority that the $42 million raised by the sales tax hike would pay to operate BART.

“If asked if $42m is enough, I don’t believe we are in a position to say yes,” wrote BART General Mananger Dorothy Dugger in an Aug. 20 e-mail to VTA head Michael Burns. “Until we have an operating plan we really don’t know what the costs are.” Burns was asking Dugger for help responding to a statement in the Mercury News that VTA’s annual obligation to BART was $48 million, not the $42 million the sales tax hike is estimated to generate.

“This won’t go away without something from BART. Dorothy - can you help,” Burns wrote on Aug. 20.

Dugger responded hesitantly, saying BART didn’t want to be responsible for the $42 million number.

‘Not looking for agreement’

“We’re not looking for BART agreement on numbers,” Burns replied later that day. “I understand that BART wouldn’t want to do that.”

Burns went on to say that VTA was obligated to pay BART whatever the costs of operating and maintaining the line to San Jose turn out to be.

“VTA will pay actual cost,” Burns wrote. “If greater than 48 VTA will pay.”

The e-mails, obtained by a group that opposes Measure B called BayRail Alliance, follow revelations earlier this week that VTA officials worked very closely - critics said illegally - with campaigners for Measure B. E-mails between the two groups showed public officials at VTA helping the campaigners wrote literature, draw maps and prepare to argue in favor of the sales tax increase.

Opponents of Measure B said the new BART e-mails strength the case against Measure B.

‘Political cover’

“It means that the VTA board placed a tax measure on the ballot without even knowing what the costs of the project are going to be,” said No on B spokeswoman Margaret Okuzumi. “VTA is attempting to obscure this, to hide this, to get some kind of political cover from BART.”

Representatives of VTA and BART last night said that studies by their consultants showed the sales tax increase will cover the cost of BART-to-San Jose operations.

“This sales tax is a supplement to the whole financial picture to meet the agreement with BART,” BART spokesman Linton Johnson said.

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Palo Alto Daily Post 10/27: Emails reveal VTA’s role

Palo Alto Daily Post 10/28: VTA’s divided loyalties

Piecing together the puzzle on the true cost of BART

Hear from the riders

VTA—Worst Transit Agency in the U.S.

VTA officials deny campaign impropriety
Authority accused of working too closely with Measure B supporters

…The transportation authority was accused of working too closely with the Silicon Valley Leadership Group (SVLG), which supports Measure B, by the campaign opposing the new tax. The “No on B” campaign filed a complaint with the Fair Political Practices Commission (FPPC) last week. The complaint refers to about 500 pages of e-mails between officials from the VTA and the SVLG, which were obtained by a Public Record Act request. While most of these detail little more than exchanges about transportation information, a few refer to a meeting between officials from the two groups to discuss media outreach…

…The e-mails cited by the campaign include exchanges between Yost and Loft, arranging a meeting to discuss which newspapers and reporters the “Yes on B” campaign should reach out to. The FPPC campaign cited these e-mails, as well as those detailing the VTA assisting the SVLG with maps and other presentation materials, as evidence of impropriety…

…”Public agencies are allowed to provide information that’s unbiased, as long as they’re not being partial to one side,” Okuzumi said after the complaint was filed. “The VTA crossed the line to actually collaborate with the campaign.”

Special to the Mercury News

The Valley Transportation Authority (VTA) is after our money again with another one-eighth cent sales tax to fund this year’s version of BART-to-San Jose. It already collects two separate half-cent local sales taxes and another quarter-cent state sales tax that add up to a total tax burden exceeding $250 million a year. That could buy 46,000 clean hybrid cars over a five-year period, enough to carry all light-rail passengers four times over.

The VTA claims to fight traffic congestion, but it carries at most 2 percent of Santa Clara County’s commuter trips, of which fewer than 1 percent are on light rail. This is no surprise. Even the country’s most-traveled light rail, the Blue Line in Los Angeles, carries the equivalent traffic of just one freeway lane. The VTA does much worse, garnering just 9.7 percent of its revenue from passengers, who ride trains that, according to calculations from federal data, average just 15 passengers. Over half of VTA funding comes from taxes — that’s why it needs another tax, to fund an operation that isn’t economically viable. Meanwhile the Mineta Transportation Institute reports that our anemic bus system needs funding, at a time when we’ve been spending $40 million per mile to build light rail.

Bad to worse

So how do you fix two inefficient, partially constructed transportation systems? Build a third one, of course. Let’s do BART, a 1960s technology that’s really expensive.

Sometimes it’s more efficient just to widen the road. The latest 2003 study from transportation-savvy Reason Foundation in Los Angeles reports that a mile of freeway in Santa Clara County costs $10 million-$20 million. Expressways are much cheaper. With higher capacity and lower cost, these roads carry 12 to 70 times more passenger miles per dollar than light rail. By 2020, we should be driving on a good highway system in zero-pollution electric cars — a cheap, convenient, ecological solution. Instead we could be saddled with BART and light rail that would carry less than 5 percent of commuter trips even by VTA’s rosy estimates. And note that the percentage of passenger miles carried by VTA would be still smaller, because auto trips are typically more than twice as long as light-rail or bus trips.

Don’t believe the hype. In 2000, Carl Guardino, CEO of the Silicon Valley Leadership Group said, “Measure A pays operating costs for BART, rail and buses for decades without additional taxes.” The truth: VTA will need not only this fourth tax, but another in the future. A recent state audit implied that a fifth tax is all but inevitable if Measure B passes, given projected budget shortfalls. And our money is not being well spent. VTA employees enjoy nearly 70 percent fringe benefits, yet a grand jury criticized “high absenteeism” and revealed that employees spent on average only three-fifths of their time in revenue-generating tasks, such as running the trains.

Sales tax hurts valley

Founded as the Silicon Valley Manufacturing Group with a charter to help keep manufacturing jobs in Silicon Valley, the newly renamed SVLG does anything but. My company left the SVLG when it began to support a new, job-killing tax in almost every election, including this one. Sales taxes have eviscerated Silicon Valley’s manufacturing base. California is one of only three states that levy sales taxes on the manufacturing equipment bought by companies to create new factories and jobs. That’s why there’s so little silicon left in Silicon Valley. Most semiconductor companies, including mine, now manufacture silicon chips out of state.

Measure B will be particularly damaging to our economy because it will tax us forever for a BART line whose route is so poorly planned that it requires an incredibly expensive nine-mile tunnel and ultimately never connects to the airport, requiring a “people-mover” instead. And it won’t help traffic congestion a bit. Vote no on Measure B.

T.J. Rodgers is founder and CEO of Cypress Semiconductor Corp. in San Jose.

See:

Economic hype

Op-ed from Blanca Alvarado

Eight years ago, Carl Guardino wrote in the ballot argument for the 2000 Measure A sales tax: “… pays operating costs for BART, rail, and buses for decades without additional taxes.” To support his claim, VTA even produced a new sales tax revenue projection a few weeks before the election.

After that tax passed, VTA and SVLG tried to save funds for the BART project by targeting youth, seniors, and the disabled. Claiming that these riders weren’t paying enough, VTA doubled their fares under pressure from SVLG. At the same time, VTA also drastically reduced bus service that connected neighborhoods with schools, hospitals, and jobs. This contributed to a 30% drop in VTA’s ridership from 2001 to 2006.

Today, even with growing transit ridership, VTA still has fewer riders today than it did in the year 2000. Furthermore, VTA has no plans to restore the service that got cut.

Audit after audit show that VTA does not have a balanced spending plan, and that VTA isn’t being honest about what new taxes would be required to complete the BART project. Instead of following the auditors’ recommendations, VTA chose to hide the construction cost and distort the ongoing subsidy.

Bottom line, VTA is withholding key information and misinforming voters. A vote for Measure B tells VTA, sure, give us more broken promises, we’re happy to  pay loads of taxes for little results.  Only by voting NO will voters be able to send a strong message to VTA that it is time to change their ways and use their billions of dollars to start delivering new transit now. VTA is instead choosing to line consultants’ and developers’ pockets using a project that would not carry any riders until 2018 at the earliest.

Further reading:

What have we got after 8 years (VTA Watch)

“When compared to its peers – the largest transit agencies in the U.S., selected from the FTA’s “Top 50” report – both VTA’s bus and light rail operations were clearly the worst. In fact, in what are the most important metrics for the VTA’s most important transit mode, bus subsidy per passenger and per passenger-mile – VTA’s performance was so poor that it was, quite literally, “off the scale.”

“VTA’s reaction to the down-turn in its sales tax revenues following the “Dot-Com” bust was to significantly increase fares and to cut back on service, while continuing to do all it could do to further the construction of its rail projects, producing a 30% decline in transit ridership from 2001 to 2006, the largest I have ever seen for a major transit agency in the absence of events such as hurricanes and long-term labor actions.”—Thomas A. Rubin, Transit and Government Finance Expert, CPA, CMA, CMC, CIA, CGFM, CFM

Read more in Mr. Rubin’s declaration to the court (140 kb Word document)

Facts about the Measure B tax

Hear from the riders

Vote “No” on Measure C

Vote “No” on Measure D

Want faster and more frequent Caltrain? Vote “NO” on Measure B

VTA Reform

Q. I want to talk a little about VTA and BART, which is not directly your portfolio, but certainly affects the county. When this first came up in 2000, Mayor Gonzales did an end-run around the supervisors and went straight to the VTA to put it on the ballot. And there was a replay this time when they went to the VTA for a one-eighth cent tax. Does the competition with the hospital parcel tax bother you?

A. Yes.

Q. Tell me why.

A. Because I think medical care is the number one issue in this county, in this state, in this country. And to say a capital project such as BART should be the priority troubles me. I see the priority as physical health, mental health, and frankly, education over BART. That’s my personal view.

Q. If I could follow that up, I’d like to ask a question about VTA’s governance. A recent public records request from former Monte Sereno Council Member Mark Brodsky suggested that the VTA and the Leadership Group work very much hand-in-hand. Carl Guardino asks Mike Burns to lobby people. Burns provides help for their lawsuit. They exchange information on speeches. This is quite extensive. Should a public agency and a private lobby be that close?

A. No, they should not. We’ve all in this valley looked at that relationship. I’ve seen the VTA board make decisions on private polling that’s been done by the Leadership Group. We have tried over the years to see the polling. The leadership group is very selective. They will show you some questions, some information. Because they paid for it and it’s a private poll, you don’t see it. But there’s always a sense of uneasiness. Is the VTA board making decisions in public based on what is on the public record? That’s what’s troubling. I don’t want to join in any accusation, but I’m troubled by it.

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News articles about secret SVLG polls:

http://groups.yahoo.com/group/BATN/message/39055

http://groups.yahoo.com/group/BATN/message/39056

On shady SVLG tactics:

Herhold: Suit raises questions about tactics of BART backers

“we have witnessed irresponsible secrecy, deceptive promises and political threats around a local public policy issue.”—Supervisor Blanca Alvarado, commenting in the Mercury News

Damaging revelations about VTA and Yes on Measure B tax campaign uncovered

VTA, the same agency that already collects three different sales taxes. It is the same agency that built and operates the light rail system, which is the worst-performing light rail in the US.

2. Who would operate/maintain the BART project?

VTA would pay the BART District to operate and maintain the line. However, VTA would have no representation on the BART District Board, nor would VTA have any role in labor negotiations, procurements, or design standards.

3. Will it connect to the San Jose Airport?

No, VTA has planned the line so that it won’t connect to the airport terminals directly. One would have to transfer to a people mover at the Santa Clara station or at the light rail stop to get to the terminals. The Measure B tax doesn’t fund the people mover, and VTA has been delaying building it. See also Critics: BART route outdated

4. How much will the BART project cost?

VTA estimated the project to cost $4.7 billion in 2005. Since then, VTA has refused to provide an updated cost. VTA General Manager Michael Burns recently told KCBS that the project should cost about $6 billion today. The $6 billion cited by Burns is just for construction, it does not include financing cost, which is necessary to address the cash flow problem. Financing costs alone could add additional billions to the project cost.

5. Why is VTA withholding updated BART project cost estimates?

VTA is withholding the new cost estimates and delaying producing a financial plan, so they won’t have to show that building a BART train to Fremont will require additional taxes and delays to other county transit priorities such as East San Jose light rail, Airport people mover, and Caltrain electrification.

6. Could BART be built without Measure B?

If VTA chooses to build a line without expensive tunneling, existing taxes may be more than enough. For the last 8 years, VTA has refused to consider any scenario that would not include expensive tunneling.

7. Would Measure B be enough to cover the operations/maintenance of the BART line?

VTA claimed it would, but VTA misinterpreted key clauses in the contract with the BART District. When all of the elements of the contract are considered, Measure B alone would not be enough to pay BART for the ongoing cost.

8. Why is VTA misinterpreting the contract to justify Measure B?

VTA has gotten into a bad deal with BART in 2001. Even Measure B supporters agree: “I appreciate that the agreement with BART was no sweetheart deal for VTA, but I also hold no illusions about our ability to renegotiate it, so I’m operating under the assumption that we’re stuck with it until somebody tells me otherwise.” - Sam Liccardo, VTA Board Member and San Jose City Councilman

In addition to the cost of hiring operators, VTA is required to pay BART to upgrade stations and other facilities in San Francisco and the East Bay.

9. Why doesn’t VTA put a clause in Measure B to protect bus service?

Because VTA knows Measure B wouldn’t be enough for them to deliver this BART train to Fremont, VTA would have to dip into other funds to pay for the remaining shortfall.

During the last 8 years, VTA doubled the fares for seniors and the disabled as well as slashed bus service, which reduced mobility to those who need transit the most (read the testimonials here). That situation is likely to happen again if Measure B passes.

10. How much more in taxes would an average family pay VTA?

An average household of three is already paying $350 to VTA every year. Measure B would be a more than 10% increase on top of the other VTA sales taxes.

11. If Measure B goes into effect, does it mean that VTA can actually build it?

Measure B can go into effect even if VTA does not have enough funds to build the project.

12. Can we trust VTA’s ridership projection for the BART project?

VTA and BART have a history of overestimating riders to justify rail projects. See VTA Watch for details how how flawed their ridership projections are.

Failing to meet ridership projections will at the end hurt taxpayers and transit riders. Taxpayers would have to subsidize unfilled seats. Transit riders would see less service and higher fares on local transit as VTA would have to divert limited operating resources from buses to trains.

13. Isn’t Measure B supposed to improve public transportation? Why are transit advocates like BayRail Alliance, Modern Transit Society, and VTA Riders’ Union opposing this?

For the past 8 years, VTA has been spending millions to promote the BART project while raising fares and cutting bus service. Transit advocates understand that bus service is an important part of the public transit network, and it is the only mode for many youths, seniors, and the disabled to get to schools, hospitals, and jobs. Transit advocates believe that VTA should tell voters how much the project will cost and draft a plan that wouldn’t put existing service at risk.

see also Economic Hype

Piecing together the puzzle on the true cost of BART

Vote No on Measure C

Vote No on Measure D