MARTA Considers Drastic Measures To Balance Budget
Decatur Metro | January 6, 2009
The AJC reports that MARTA’s financial situation is even worse than originally thought.
With a majority of funding coming from the penny sales tax in Fulton and DeKalb, and no support from our car-loving state (or Cobb or Gwinnett), our public transit service has to be ultra-creative in how to raise revenue and cut costs by $10 million.
The most impactful options currently on the table include a 25 cent fare increase and reducing (or even eliminating) weekend service.
Find out all about it tomorrow, Wednesday January 7th. MARTA is holding a public meeting on the budget at the Decatur Library from 6-9p.
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I hope the state doesn’t give them a penny, because, as useful as a well-run MARTA could be, giving money to the hapless folks in charge is like throwing it down a drain. There has not been a fare increase since 2001 — 8 years! — and they’re now considering a hike of only 25 cents? In other words, without so much as a COLA adjustment to the fares over that time, MARTA riders have seen an effective reduction in their fares every year since 2001, and now, all of a sudden, MARTA’s management is just shocked at their fiscal plight. Who’d have thunk it. And where do they go looking for money? Not so much from the people who ride the trains, but they want more taxes from an already cash-strapped state government.
And as I’ve posted before, the fare system in place makes zero sense. It doesn’t take an ultra-creative aproach to raise more revene, it just takes the common sense to charge an appropriate fee for the service provided. Thus, why not institute a destination-based fare immediately? Certainly most folks would pay more than $1.75 to get from Dunwoody to the airport, when their alternative is to sit in traffic all the way down 85 until they get to pay $8 a day to park at Hartsfield. MARTA invested what was surely hundreds of thousands in the Breeze system, yet does not make the best use of that technology.
Your damnation of the “hapless folks in charge” assumes that a destination based fare charge would be immediately successful and wouldn’t result in a drop in ridership. Surely this is an assumption we can easily make on this blog, but something MARTA would need to worry about in a city that treats its public transit like a ugly step-child. With a weaker safety net than most transit systems, big risks – like charging riders a lot more – become all the more difficult to take.
BTW…MARTA hasn’t said anything about asking for more taxes from the state…I’m sure they’ve all but given up on that hope…that was all me.
Also, Marta ran a surplus for the two years in a row before this year. Doesn’t seem that hapless to me (especially without a COLA adjustment!).
I’d guess that Marta hasn’t gone to a destination based fare immediately because it would be expensive, very complicated, politically devastating, and potentially not profitable (as DM just pointed out).
They’re probably collecting data from the Breeze system to make educated decisions about fare changes, and gathering public input to garner support and lessen the impact of hiking the fare.
I agree DEM.
At $1.75, $2.75…etc…it’s a bargain at twice the price.
Fare increases are best absorbed by a middle class ridership. Attracting such riders is a decision that needs to be made on the front end — meaning choosing up front to invest in, build, fund and maintain a system of sufficient quality and amenity that it becomes desirable to people with options.
For a host of reasons, the metro area chose not to go down this path. That’s done, and the result is a system that predominantly caters to the needs of the poor, working and otherwise. Yes, I know professionals ride it too, and I applaud them, but they are nowhere near assuming the norm.
Given that reality, dem may be right that fare increases will add to the coffers, but it’s just as likely — if not moreso — that they’ll repel the one solid demographic Marta has left. It’s not a slam dunk.
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Scott, isn’t the “one solid demographic” that Marta has the same one that has no option other than Marta? Are they not, in effect, a captive ridership? I would think if Marta were dependent on a cohort with options then a fare increase would impact ridership more, unless there was also an increase in quality.
I think the time has come to for this supposedly major city to have a public transit system that strives to appeal to more than just poor people. The truly poor can subsidized with reduced fare programs (as I believe they are now to some degree).
That’s what I mean, Brian. A fare increase might just be putting the squeeze on those least likely to be able to bear it. What happens when people with few other options find themselves losing the one option they have? Not sure I want to find out.
As for those with options, sure, they could opt out if the price were increased to a level where the service wasn’t justified. I fear that’s what could happen here with the modest professional ridership we do have. That was my point about investing in a system that meets middle class expectations/demands/needs. DC’s Metro system does this and is able to charge considerably higher, destination-based fares while still presenting a good option for many.
I agree with you totally that Atlanta deserves better, but better comes with a price. The question is, who pays it? I believe we should get some state money like every other major transit system in the country, but not all agree.
How about a casino located in the old Southern Railway yards next to Philips Arena, and tax that for city public transportation? Because it is property currently owned by RR, it is not subject to approval/law of our squeamish legislators? As we all know in Decatur CSX can do what it darn well pleases and damn the public.
Or allow Sunday alcohol sales and designate that portion of sales tax rev. to MARTA?
Oh I forgot…gambling and alcohol…the world would come to an end…NEVERMIND!
MARTA is at least partly crippled by the law that says a certain percentage of the sales tax revenue must be spent on capital projects, not operating expenses. So, in order to spend the money that can only be used for capital projects, they buy and develop space near the stations in order to try to provide a customer base. Then certain people at the Capitol won’t let them change the percentage because they say they’re wasting money developing property. You can’t have it both ways. Remove the restriction and let them spend money where it will most benefit MARTA and us, the riders.
Also, the folks downtown have refused to extend the sales tax collection authority far into the future. MARTA could sell bonds based upon future revenues, but without a guarantee that the taxing authority will last as long as the bonds, nobody would want to buy the bonds.
So the rail systems of most major cities have destination-based fares, but instituting such a system here is “politically devastating”? And we’re talking about the first fare increase in 8 years. Whether it comes in the form of an across the board increase, or a destination-based system, is quite secondary to the point that fares have to go up. (Or are people still going to be paying a mere $1.75 per ride in 2050?) It seems quite logical to charge a bit more dpending on how far you are going, and to where.
And isn’t a simple solution to the poverty problem to continue charging a heavily discounted rate for monthly access cards, preserving access to the most needy who need MARTA to get to work, while making point of purchase fares more expensive and destination-based? This would get more revenue from airport travelers, conventioneers, and folks taking MARTA to the Georgia Dome, Turner Field and Phillips Arena. None of those people would be very sensitive to even a large fare increase.
dem, what you say is exactly right. The question is, do our leaders have the political backbone to do it?
Dem, as I think I qualified above, it would only be “politically devastating” if Marta had hiked the fares and instituted a distance-based system at the first hint of budget trouble, especially when it doesn’t address the particular problem at hand.
It would kind of be like if the City of Decatur had annexed a bunch of stuff, raised your property taxes, and asked you about it later.
I’m not arguing against a fare hike or a distance-based system. I’m just saying that they’re in all likelihood performing necessary due-process stuff like public input. The Breeze system gives them a lot more information to make an informed decision, too, but I don’t think it would be one they could make overnight.
Lain, I don’t understand. The problem at hand is that MARTA is running out of money. Charging higher fares is aimed at that very problem. In fact I think it should be easier to institute now than at a time when the economy is roaring. Then, the answer to any fee increase would be that it’s not needed at all. At least now there is the exigency of a real fiscal need.
Agreed, Dem. I think if anything would be “politically devastating” it would be reducing or suspending (mind-boggling that this is even on the table) weekend service, not a measly 25 cent fare hike. Destination based fares make a lot of sense, but in the short term fares have to go up across the board.
DEM, you called them “hapless” because they haven’t implemented a new fare system. Lain countered and said that they’ve turned a profit the past two years. It doesn’t sound like he’s arguing with you over a price increase, just your judgmental take on their situation. What kind of criticism would they have received if they had raised fares while turning a profit?
Is the problem that MARTA is a bunch of dunderheads (who turned a profit the past two years) or is the problem the same for MARTA as it is for the city of Atlanta, the federal government and every other public transit system – that the economy tanked?
I’m going with the latter.
Thanks, DM. Agreed.
DEM, I just want to be clear — I agree that a fare hike is a good and necessary thing. I agree that a distance based fare system might be a good idea if it’s carefully studied first. I agree with Brian that it would be a lot worse to cut weekend service than to raise the fare.
The root of the problem is that Marta budgeted for penny tax money that never materialized. The root of the problem is not that the fare system is broken. While your suggestion addresses the “needs more money” problem, it doesn’t address the funding mechanism problem. An increase in fares simply will not account for the penny tax deficit.
Marta seems to be exploring the very same options that you’ve suggested. To suggest that they merely throwing money down the drain seemed a little irresponsible to me, that’s all.
hang in there Dem…don’t worry about DM throwing around the judgemental moniker…it happens. Strong opinions that vary are often seen as “judgemental”.
Those of us with long memory history in Atlanta know that MARTA has been ALWAYS on or near the edge of insolvency almost yearly due to inefficiencies, mismanagement since inception, etc. Two years profitability don’t go far to offset years of losses. Just ask the government (taxpayers) for money…that is the solution. Heck, it is even the current vogue. So while everyone wants to navel gaze and debate the tax deficit, nothing is being done and the fiscal problem exacerbates itself. MARTA has always been a lesser among equals in all major city mass transit, and that is a crown of thorns woven over the last what…twenty five years? And still it is inefficient in its routes, money management and long range planning.
Thanks for comforting DEM Tarnation, but the two of us have been through this many times before…I know he can handle it. He’s one of the coolest heads out there.
As for your justifications for not trusting MARTA…So because MARTA was crappy in the past means its crappy now? Once a sinner, always a sinner huh? And something about generalizations regarding inefficient routes, money management and long range planning? Wow…I’d love some details about their current plans that fit those characterizations. Otherwise, its conveniently difficult to counter.
Their management performance, customer service and PR , on time performance, fiscal performance, ridership statistics in terms of its route desirability etc. etc. speaks for itself. I am not advocating throwing out the baby with the bathwater, but throwing MORE money (public tax payer money) without some sort of reasonable hope for a change in some significant form is just illogical.
I know DEM can handle it. We all can! The term “judgemental” tossed into the mix just has the faint whiff of well, judgementalness–if that is a word.
Not only can I handle it, but DM is right: I am extremely judgmental. But I would point out that, like MARTA, Lehman Brothers made huge profits in 2006 and 2007. I don’t think those profits place their management above criticism.
Lain — understood, looks like we were talking past each other a bit. Maybe you are right that fare increases can’t make up for the loss of penny tax revenue, but I don’t know either way. I do disagree about how carefully they need to study a destination-based fare system. The use of those systems is so prevalent that that there’s little risk in instituting it here. We are not starting from scratch.
Keep in mind that the perception of someone being judgmental is often just a consequence of them having a strong sense of what they believe and stand for. Not saying their beliefs are automatically right but many people cast no judgments because they hold no convictions.
So, Dem, DM and everyone else here, bring ‘em on! Without solid perspectives, ain’t none of us ever gonna learn nothin.
Scott:
Thanks for clarifying my point so eloquently. To me, characterizing as judgemental is just judgemental itself. Strong opinions that differ are judgemental ones.
Darn…that should be “…are not judgemental ones.” I will now proceed to the Dekalb Emergency room after shooting myself in the foot with my typing skills.
DEM, since we both agree that MARTA should follow other prevalent transit models in the U.S., can we also get a little state funding?
Isn’t maintaining the desirability of the state’s only metro region in the interest of the entire state? Or should we just accept that we’ve grown to capacity in terms of car traffic and let the city slide into obscurity?
The last time MARTA’s board seriously considered a combined fare increase and service cut — about 4 years ago — people came out en masse to the board meetings to vent their disapproval. The large majority of those who spoke out agreed that if they had a choice between a fare increase or a service cut, they would take the service cut.
So the board instructed staff to create a new plan, based on that sentiment. What we got as a result: service cuts only.
The state doesn’t have any funds. We have a 2 billion deficit.
Given the massive state government subsidy of our automobile based culture and developers, in my opinion, it is shameful the no State financial assistance is provided to MARTA. Then again, given our State’s historic neglect and even hostility to anyone not white, suburban and middle class or higher, it is no surprise. I do ride MARTA, everyday. The large majority of the riders are working class people just trying to survive. The system seems well run given the constraints of a hostile state government.
According to a very high ranking MARTA official, the Breeze system will not accomodate distance pricing without an additional $20 Million in software. MARTA is very discouraged about this revelation because they were led to believe when they switched to Breeze that it could be easily converted for distance pricing.
$20 million in Software!
That is complete horsequeeze!!!
Who is running the show over there? What did they get two vendors in there and ask both of them how much it would cost?
I am in software sales. A $1.5 million sale to a $7 billion company can run every application company wide.
Given that Marta is not the most technology savvy customer out there, it sounds like your source is completely misinformed.
My source is at the top of the food chain at MARTA. I also questioned the $20 million and the source repeated the number.
If MARTA bought a system that could not be upgraded to a distance-based fare without another 20 million outlay, I rest my case concerning the quality of their management.
Did anyone make it to the MARTA forum at the library last night? I wanted to, but didn’t manage it.
While online I wanted to add some “actual user” perspective on the fare increase. I commute daily on MARTA, and believe I (just about) squeeze into that Middle Class with choices demographic Scott identified earlier. My primary reasons for using MARTA are a combination of cost saving, and environmental conscience….
Truthfully, the fares are very low and I’d pay more. However, I doubt my environmental conscience would withstand a large increase in the cost of my commute brought about by a switch to a distance based fare structure. Hence, my personal situation validates Scott’s fear that people with other choices will desert the system – and I’m sure I’d not be unique.
It’s ludicrous that MARTA fares haven’t increased in 7-8 years, but it’s not realistic to expect that MARTA can catch up overnight by instigating huge increases. The proposed 25-cent increase initially sounds pathetic, but it equates to 14% when viewed in context. Assuming a similar increase is taken on all the weekly/monthly passes I think that’s a decent start – and hopefully those in change will realize that once a year might be a better goal than once a decade for fare increases!
David over at inDecatur has a report from the meeting which includes this quote from the MARTA folks…”For every increase of 10% in fares, 3.5% of the ridership is lost.”
DM, thanks for the link. It sounds like it was an interesting meeting!
It’ll be interesting to see how that fare increase vs. ridership decline estimation pans out in reality!