Metro Facing Layoffs, Cutbacks
Ridership Up Amid A Record Deficit

By Lena H. Sun
Washington Post Staff Writer
Friday, January 9, 2009

Metro faces a 13 percent shortfall in its $1.3 billion operating budget for next year, and officials have suggested cutting almost 900 positions and enacting the largest-ever cuts in train, bus and paratransit service, even as transit ridership in the region and across the country is soaring.

Agency officials said the budget difficulties reflect the grim economic reality facing local and state governments, which provide a substantial portion of Metro's funds. Transit agencies across the country also are facing service cuts.

"The budget year ahead is as bleak as the national economy," Metro General Manager John B. Catoe Jr. told board members.

The gap of $176 million is the largest in the agency's 33-year history. Unless board members and agency officials are able to make significant additional expense cuts or discover new revenue to plug the hole, riders could be facing $73 million in service reductions starting in July, officials said. They did not specify what might be cut.

Higher fares are not on the table under the proposal that Catoe presented yesterday to the board. Board members, however, could authorize fare increases, although that appears unlikely, given that Metro raised fares and fees last January and promised not to consider raising them again until July 2010.

"To close this $176 million gap, we propose to cut our projected expenses by $103 million," Catoe said. "Then, as a last resort we are proposing $73 million in service cuts."

Catoe said the agency has identified 891 positions, about 8 percent of the workforce, that would account for much of the $103 million in administrative and operational expense cuts. About half of the 891 positions are vacant. Of the positions being considered for elimination, 313 are administrative and 578 are service-related, which includes bus and train operators and mechanics.

Several longtime board members said they could not recall any time when the transit agency had been confronted by such sizable looming layoffs and service reductions.

"In my time on the board, there has never been anything of the magnitude of this type of service cut," said D.C. council member Jim Graham (D-Ward 1), who has represented the city on the board for 10 years.

Catoe said Metro plans to work with local governments in coming weeks to come up with recommendations for service reductions, which will be presented to the board. The transit agency has cut jobs and expenses over the years to fill budget gaps, but has not cut service in 13 years.

Service cuts that would have relatively less impact would be on less heavily used bus routes, which tend to be in the District, the jurisdiction that has the most Metrobus service. Service cuts are likely to resurrect the city vs. suburbs dynamic that dominated fare increase hearings in December 2007. City board members will push to equalize the pain of any service cuts among the jurisdictions. Suburban members probably will point to efficiencies that can be maximized by eliminating the lowest-performing bus routes.

"This pain has to be proportionally distributed," Graham said.

Budget officials said expenses have increased by $159 million from last year because of stock market losses in the pension fund, a huge jump in paratransit ridership (Metro's costliest service) and rising energy and labor contract costs. Meanwhile, despite growing ridership, revenues dropped by $17 million because of unfilled parking lots, declining investment interest and less revenue from other sources such as property rental incomes.

Catoe said the transit agency wants to deliver a balanced spending plan that remains focused on safety and customer service without asking local governments or riders to pay more.

Last fall, Catoe cut pay raises and vacancies, froze hiring and trimmed internal contract, travel and other administrative costs.

"We appreciate the dedication and service of all our employees, and we will do everything we can to ease the transition of those employees who will leave Metro," Catoe said.

Union officials said they oppose service cuts and layoffs. Jackie Jeter, president of Amalgamated Transit Union Local 689, which represents 10,000 current and retired Metro workers, said management has not identified positions that might be cut.

"The jurisdictions that fund Metro have some tough decisions to make," she said. "Metro cannot run a world-class transit agency without investing in services, sustainability and capital enhancements." The Metro employees who will be charged with transporting crowds to the historic inauguration of President-elect Barack Obama are "the same workers who need the region's support," she said.

Some employees have been told that layoffs will begin shortly after Inauguration Day, when the transit agency has asked employees for an all-hands-on-deck effort to carry the largest expected ridership in history.

This is the agency's second proposed round of layoffs in three years. In 2007, Metro cut 254 positions, or almost 20 percent of its administrative staff. The proposed layoffs, if implemented, would reduce the number of total positions to about 10,100, which would be the same level as 2006.

Metro's capital budget of $478 million has also been cut by a third compared with the last fiscal year.

Proposed service cuts will be discussed over the next several months at board Finance Committee meetings and by local government officials and the Riders Advisory Council. Public hearings on potential cuts are expected to be held in March, and the Metro board is expected to approve a final budget in June. Fiscal 2010 begins July 1.