District Mayor Muriel E. Bowser (D) discusses a Metro incident that left a woman dead near the L’Enfant Plaza station in January. (Linda Davidson/The Washington Post)

A major rift within Metro’s leadership has disrupted the transit agency’s search for a new chief executive after board members from the District and Maryland objected that the initial three finalists for the job weren’t the kind of executive needed to fix the organization’s problems, District and Metro officials said.

The District government, led by Mayor Muriel E. Bowser (D), and a Maryland board member are pressing for a financial turnaround specialist who can address not only safety issues but also what critics see as the agency’s deep fiscal difficulties.

The internal battle has aroused concern that the dispute will hurt Metro’s reputation and make it harder to attract good candidates for the top job.

It also has significantly delayed the hiring of a new chief executive at a time when the fatal tunnel smoke incident Jan. 12 has drawn fresh attention to worries about the system’s safety and reliability.

A majority of Metro’s eight voting board members had tentatively agreed by last week on three traditional transit executives as finalists to replace Richard Sarles, who stepped down in January after heading Metro for more than four years.

A Red Line train arrives at Metro Center station in Washington. (Sammy Dallal/For The Washington Post)

But Bowser and other top District officials told Metro Board Chairman Mortimer Downey at a Feb. 25 meeting that such a leader was unsatisfactory because Metro needs someone with experience rescuing a troubled system.

The next day, Downey told the board that the three finalists had withdrawn their names. Downey said the candidates pulled out because the confidentiality of the job search was violated when information that potentially could be used to identify them was leaked to a local television reporter.

Bowser was joined at the meeting by D.C. Council member Jack Evans (D-Ward 2), who is one of the critics on Metro’s board, and D.C. Council Chairman Phil Mendelson (D). All three are worried that the system has been slow to recognize and act on what they see as its dire financial straits.

That concern is shared by a Maryland board member, Michael Goldman, and by new Maryland Gov. Larry Hogan (R), according to Metro officials. Bowser, Evans and Goldman all declined to comment Wednesday.

Downey and Dennis Anosike, Metro’s chief financial officer, said the critics’ concerns were exaggerated. They said Metro has a temporary cash flow problem, but it’s in the process of being fixed.

“I’m a little frustrated,” Downey said. “We are not bankrupt. We are not in need of a financial turnaround specialist. When you call in someone like that, it’s like calling in the undertaker.”

The critics are worried partly because a Metro financial audit is four months overdue and because the system has reached limits on drawing on lines of credit to cover cash flow demands. Looking ahead to the next fiscal year, costs are rising but ridership and revenue are flat.

Bowser served much of the past four years on the Metro board before becoming mayor, including a stint as chair of the board’s Planning, Program and Real Estate Committee. In addition, all Metro board members serve on the panel’s finance committee.

Asked why Bowser didn’t press for financial overhauls during her time on the board, a senior Bowser administration official said the board wasn’t aware then that the audits it was receiving were inaccurate.

“During her board tenure, the board was presented with three clean audits,” said Bowser’s chief of staff, John Falcicchio.

Alarm bells went off for Bowser and other District officials in late December or early January.

At that time, District Chief Financial Officer Jeffrey S. DeWitt objected to Metro’s proposal to tap the bond market for a large loan, up to $440 million, to be repaid over up to 25 years. Metro later halved that request to $220 million and shortened the repayment period to one to three years in response to objections from the District and others.

“We have a system right now where they’re borrowing heavily and concerned about meeting their operating costs,” Mendelson said. “My own view is that the organization is not taking this seriously enough.”

He said Bowser took the lead at the meeting with Downey and another board member, Tom Downs, in pushing for a new chief executive who could rescue the system’s finances.

“There needs to be a turnaround person, not strictly a rail person or bus person or transit person, but someone with a proven record of being able to turn around a large corporation that has financial difficulties,” Mendelson said.

In defending Metro’s finances, Anosike said that while Metro has hit ceilings on $302 million in lines of credit, it has “more than enough cash in the bank to meet our payrolls, electric bills and any other obligations coming in.”

He said the audit was overdue because of the challenge of responding to financial management problems identified in a Federal Transit Administration audit last year.

Those problems led the FTA to slow reimbursements paid to Metro, which has been a major source of the cash-flow problem. Anosike said Metro got some relief last week when a bank lender agreed to extend for a year a $75 million line of credit.

“I’m still learning how we got in such a hole,” Downey said. “I’m embarrassed as heck that we’re in the hole. But we’re further out of the hole than we are in the hole.”

The finalists’ withdrawal left a sour aftertaste for some board members. One, who spoke on the condition of anonymity because of the sensitivity of the issue, said “some rogue board members” had used a media leak to restart the process in order to get the kind of candidate they want.

“By blowing up the process, they materially worsened the prospect that we would ever be able to get any kind of high-quality candidates,” the board member said.

Reporter Adam Tuss, who covers transportation for WRC (Channel 4), said last week that he had learned where the three finalists worked but not their names. When he shared that information with Metro officials, in hopes of obtaining further information, it prompted Downey to notify the finalists that their names might become public.

Asked about the bad feelings, Downey said he wanted the board to be “in sync” and planned to push for that at the next meeting.

“I want to get them in a room together, which we will do [March 12], and get them face to face,” Downey said. “It would be a useful conversation to have.”

He added: “I don’t think we get anything by lobbing grenades in little bits in the newspaper.”

Mary Pat Flaherty and Jonathan O’Connell contributed to this report.