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Even as Metro officials complain that tight finances are crippling their ability to run the Washington area's subways and buses, they continue to pour millions into programs that have little to do with transporting passengers.
The agency spent close to $40 million for a massive training and maintenance facility that five years after the purchase is overbudget and underused. Millions more are needed to finish renovations.
When senior agency attorneys wanted two new window offices and a 1,440-square-foot law library, Metro spent $270,000 to accommodate them.
Metro paid more than $400,000 for a "culture change" project to teach managers to operate less like bureaucrats and more like business executives, an experiment officials now say was a bust. And the agency's inability to control overtime has led to $100,000-plus salaries for numerous mechanics, bus drivers and train operators.
Twice in the past two years, Metro Chief Executive Richard A. White has asked riders to pay higher fares, saying he had trimmed his budget to the core and his only choice was to charge more or cut service. In February, he told Congress that lack of funds had forced him to defer maintenance, spend less on customer service and cut back on cleaning the stations.
But Metro documents and interviews portray a transit agency with inconsistent spending priorities, an uneven record of cost containment and a board of directors that sometimes makes political decisions that drive up costs.
Metro's money management has taken on new urgency because the agency is in the midst of an unprecedented campaign for dollars.
After winning an emergency infusion of $1.8 billion, it is seeking an additional $1.5 billion from the federal government and is asking for a stream of permanent funding, such as a regional tax. Metro receives subsidies from the communities it serves and yearly allotments from the federal government to buy big-ticket items such as rail cars and buses.
Those subsidies, passenger fares, advertising and other revenue pay Metro's operating costs. Those costs are projected to exceed $1 billion in the fiscal year that starts in July, a nearly 50 percent increase in six years, according to the agency.
The only consistent scrutiny of Metro's finances falls to its 12-member board of directors, which lacks a staff and must rely on the agency for budget information and analysis. The current budget wasn't printed and distributed to the board until months after it took effect; directors approved it based on summary presentations.
Those who try to delve deeper say they often find themselves stymied. "They don't want to give us anything we can use to beat them over the head," said Jim Hamre, Arlington County's transit program coordinator, who advises Arlington's representative to the Metro board.
White said Metro is the most heavily scrutinized transit system in the country because it serves so many jurisdictions -- and that assures its money is well spent. At the same time, he said he would welcome greater oversight.
White's ability to set spending priorities is complicated by the sometimes conflicting messages from his board of directors. Half hold elected office in Maryland, Virginia or the District and answer to constituents; the rest are private citizens appointed by local governments. Unlike some other boards across the country, Metro's has no member whose sole job is to speak for riders.
The board told White to hold down costs but then expanded subway hours and directed Metro to buy natural-gas powered buses rather than the cheaper diesel version. Those changes pleased constituencies such as bar owners and environmentalists but pushed up costs.
Board Chairman T. Dana Kauffman defended the board's performance. "Do we spend every penny perfectly? No," he said. "But I can say we have one of the best-run systems and that money is well spent."
Board members have benefited from Metro spending. Although most members have acknowledged that they are not daily riders of the system, several have spent tens of thousands of dollars attending transit conferences in other U.S. cities and European capitals, records show. The trips allow members to ride other transit systems and learn how they work, said Chris Zimmerman, who represents Arlington on the board and has traveled to Madrid, among other places.
The agency gave board member Gladys Mack access to 10 dedicated parking spaces on Metro property for a social service organization she heads, even as commuters across the region compete for space at increasingly crowded Metro parking lots, records show. Metro charges Mack's organization $1.30 a day for each space, or nearly half what commuters pay at some of Metro's public lots. Metro General Counsel Carol O'Keeffe defended the deal, saying it did not benefit Mack personally. Mack said other organizations with no connection to the board could get a similar lease.
The jurisdictions that pay for Metro are beginning to show signs of disapproval of the agency's spending.
In 2003, Maryland Secretary of Transportation Robert L. Flanagan accused Metro of unchecked spending that had created a "party atmosphere." The state of Virginia last year hired a private company to design and build a proposed Metro extension to Dulles International Airport, arguing that the private sector could do the job faster and cheaper. It would be the first subway line in the system not built by Metro.
And when Metro proposed building a $1.2 million pedestrian bridge at the Largo Town Center Station, Prince George's County rejected the plan and opted for a simpler $70,000 version.
Where the Money Goes
White said that over the past six years, he has returned $82 million to the jurisdictions that fund Metro by coming in under budget. And he said he has worked to control Metro's biggest expense: labor.
When White came to Metro in 1996, the agency's unionized workers were the highest-paid transit workers in the country, he said. After three contracts, they dropped to sixth. "We've made huge changes, huge progress," he said.
Still, Metro's failure to fill vacancies has led to high overtime costs, allowing more than 150 unionized workers to earn more than $100,000 last year, records show. One train operator worked 1,606 overtime hours, earning $131,358. That's more than 32 hours of overtime a week. The top-earning union employee, who sits in a tower above the rail yards and controls traffic, made $135,042 with overtime, records show.
In the first 10 months of the current fiscal year, the agency incurred $7.5 million in unexpected overtime costs, senior Metro manager Jim Hughes said. Overtime has a significant impact on the agency's long-term costs because pensions are based on the total number of hours worked. As a result, some retirees get pension checks bigger than the base pay they received while working. More than a quarter of Metro workers will be eligible to retire in the next few years.
Kauffman, the board chairman, called the number of workers making more than $100,000 "unconscionable." Metro managers said they don't want to cap overtime because it provides scheduling flexibility, but they said they are exploring other ways to reduce it and trying to fill vacant positions more quickly.
Some departments are suffering from chronic vacancies. The division that repairs trains, for example, is 57 mechanics short, Metro managers said. But agency records show that others are flush. The radio division, for instance, was so bloated that its 24 employees didn't have enough to do, according to an audit in late 2003.
The audit found that technicians who repair and maintain radio equipment were reporting to work late, taking extended lunch breaks, leaving early and hiding their inactivity by falsifying time and attendance sheets.
Some of those workers would hop into a Metro truck and head to Yum's Chinese restaurant, stopping to chat up the prostitutes who worked the streets nearby, the audit found. Others filled empty hours by sleeping in Metro vehicles or in backrooms, waking up in time to punch out.
"Almost without exception, those interviewed believed that part of the problem stems from an excess" of employees, the audit found. Since then, Metro has added two positions to the division to improve oversight, spokeswoman Lisa Farbstein said.
In other cases, Metro has created new jobs for managers whose previous performance had been criticized by agency officials.
Bea Hicks was the chief operating officer for rail during a high-profile 2000 incident in which Metro controllers knowingly sent a rush hour train full of passengers toward a fire in one of the subway tunnels. Hicks defended the decision, saying it was an accepted practice to use the train as a probe to check reports of smoke. She was moved to a newly created position, chief of the office of operations liaison. Her pay went from $122,592 in 2001 to $134,246 last year, Metro records show. Hicks did not return telephone calls seeking comment.
Mark Miller presided over the operations control center during an infamous incident in which a Red Line train operator was given permission to abandon her fully loaded train during rush hour because her shift was over. Miller was reassigned last year to an emergency planning job created for him. From 2001 to 2004, his pay climbed from $107,051 to $115,825. Miller said he was asked to change jobs not because of poor performance but so he could provide his expertise to emergency preparation efforts.
Don Painter was moved last year from his job as head of the track department. Reviews found chronic shortcomings that contributed to a spate of derailments and other potential safety problems. He was installed in a newly created job as a project manager. His salary increased from $113,734 in 2001 to $122,710 last year. Painter said he was offered the new job because of his experience, not as a punishment. He said he knew the track department had problems and tried to get more resources to improve it but was turned down by the board of directors.
White said he will be tougher on his executives in the future. "Perhaps I was too tolerant," he said.
'Terrible Waste of Space'
One of the most visible examples of Metro spending is the Carmen E. Turner Maintenance and Training Center in Landover, a hulking, 680,000-square-foot building with 16 acres under one roof.
When Metro bought the warehouse five years ago to house repair shops and training labs for transit workers, senior managers told the board the total cost to buy and renovate it would not exceed $36 million, the space would be filled with employees by 2005 and, in the interim, Metro could net $6 million by renting out unused portions.
None of those predictions turned out to be true.
The agency has spent nearly $40 million and plans $10 million in additional renovations to the building, which is named for a former Metro general manager. Twenty-five percent of the facility remains untouched warehouse space, agency officials said.
Metro initially rented some unused space, but the tenant left after 14 months, and Metro never sought a replacement. The rent netted about 10 percent of the money managers promised the board, records show.
Once the warehouse for the Hechinger home improvement chain, the concrete and steel building is more than twice as large as the main terminal at Reagan National Airport. Classrooms were silent on a recent weekday, their benches vacant and computers dark. Office after office was empty. Behind the locked door of a carpeted room marked "library," the only contents were a few sagging cardboard boxes. Another locked door opened to a bare, two-story room the size of a supermarket.
The projected cost of the building could have paid for about half of the new buses Metro says it needs. Charles Deegan, a new Metro board member from Prince George's County, questioned the agency's priorities and the purchase.
"It's a terrible waste of space," he said. "It reminds me of the back lot of Universal Studios."
White defended the purchase, saying 1,000 employees signed a petition asking for more space. "Over the long term, that's as good an investment as buying buses," he said. If Metro made any mistakes it was that "we just lost sight of what happened after we acquired it," he said, adding that the agency will grow into the building in the future.
Deegan was skeptical. "I guess it depends on what you consider the future. Is it 2000-something or 2100-something?" he said.
Compared with other subway systems, Metro does a good job of attracting advertising on buses and trains and inside stations. And it has an aggressive program to sell or lease real estate around its stations. Such efforts brought in $83 million last year.
But it has failed to match other agencies on one potentially lucrative source of revenue: leasing space to companies that wire tunnels for underground cell phone service.
Metro was the first transit system in the country to offer underground cell phone service. Records show the 1993 deal it inked with Bell Atlantic Mobile has brought in $331,000 in a dozen years, or $27,583 a year.
By comparison, the Port Authority of New York and New Jersey received $786,000 last year in a deal with New York Telecom Partners to wire the Lincoln and Holland tunnels. Spokeswoman Tiffany Townsend estimated that the agreement will bring in at least $800,000 annually for 15 years.
Boston transit officials said they struck a deal to wire four subway stations that guarantees the system $1 million annually for four years and could net up to $15 million over 15 years.
Despite the relatively meager returns on its contract, Metro renewed it in 2001 with Bell Atlantic's successor, Verizon, and extended it to 2017 without negotiating better terms or seeking other offers.
O'Keeffe, Metro's general counsel, said that the agency needed an underground emergency radio network and that Verizon agreed to pay $7.6 million of the cost. "We thought this was a good deal," she said.