Rampant management failure #2: DC area Metrorail (Washington Area Metropolitan Transit Authority)

Nothing new here:

-- "What to do about DC area Metrorail?," 2022
-- "Sometimes you have to wonder if transit/transit projects are being deliberately screwed up to make transit expansion almost impossible," 2022
-- "A tenure of failure doesn't deserve encomiums: Paul Wiedefeld, WMATA CEO," 2022
-- "WMATA is pathetic: of course it belongs to "the public"," 2022
-- "DC area transit commission board member thinks he has a brilliant idea on how to fund Metrorail: sales taxes ," 2022

But recent coverage ("Metro makes case for funding as regional leaders point to federal government," Washington Post) on how WMATA needs more financial support given ridership drop offs due to covid, but also accentuated by massive management and operational failures, reminds me of one of my learnings through observation about WMATA and government.  

It's best to line up support and funding, when you're wildly successful.

It's really hard when you're failing.

From the article:

Metro’s prospects for replacing hundreds of millions of dollars in fare revenue that vanished during the pandemic appeared to be waning as stimulus money runs dry, particularly as weary elected officials watch the agency struggle during a year-long train shortage.

In recent days though, Metro has escalated its sense of urgency in finding more revenue, trying to make the case to regional leaders that it can’t move forward alone. The transit agency took the first step this month, saying it will increase enforcement of fare evasion to stanch a $40 million leak — a move that eased tensions with political leaders who were hesitant to offer more money.

Some of those same local leaders are responding with a plan of their own: Convince the federal government, whose workforce is Metro’s largest customer base, to subsidize the system’s operational costs. Unlike the local and state jurisdictions that fund Metro, federal money goes only to the agency’s capital budget but not to its separate operating budget — a distinction local officials have long said is inequitable.

Good luck with that.

WMATA should have lined up multiple and steady sources of revenue--like sales taxes and other sources--when it was new, shiny, and successful, basically, in the late 1970s and throughout the 1980s, as the system opened and expanded.

-- "Funding WMATA by a regional sales tax," 2017

Also see, "Creativity Helps Rochester's Transit System Turn a Profit," New York Times (2008). The director then, Mark R. Aesch, later wrote a book about his experience there, Driving Excellence: Transform Your Organization's Culture -- And Achieve Revolutionary Results.  It's worth a read.

The article discusses how the Regional Transit Service in Rochester New York developed "partnership" funding agreements with schools, colleges, and businesses to provide financial support beyond farebox revenue, to support mutual agreed upon objectives.

RTS did this when they were successful, so that when the 2008 recession hit, they were well placed to operate and survive financial setbacks that crippled other transit authorities who were not as well situated.

But it is also a management failure of local government.  Admittedly, oversight-wise, WMATA has a hard slog, as the State of Virginia, State of Maryland, and DC are "co-owners" now alongside the federal government.   They all have to agree on major decisions.  And the State governments can vary wildly on their support.  For example, one reason there are tolls on I-66 is to indirectly encourage DC-based businesses to relocate to Virginia to avoid tolls.

Plus at the county/DC scale, different jurisdictions have different goals for the service.  DC and Arlington County have a much more transit-centric planning paradigm than the others, who see transit as more about getting their residents to and from their jobs in the city.

Northern Virginia elected officials and stakeholders tend to be reasonably forward (not necessarily visionary) about the role of transit in the success of their communities, especially Arlington and Fairfax Counties--the latter because they think it can repattern land use along the Silver Line.

DC officials don't seem to get how the city's competitive advantage as a sustainable mobility-centric community ("DC is a market leader in Mobility as a Service (MaaS)," 2018, "Transportation and Urban Form: Stages in the Spatial Evolution of the American Metropolis," "Planning for place/urban design/neighborhoods versus planning for transportation modes: new 17th Street NW bike lanes | Walkable community planning versus "pedestrian" planning," 2021) is built upon high frequency heavy rail transit service.

Since I got involved in urban revitalization I've argued that DC had five competitive advantages: 

1. historic architecture
2. urban form (urban design) dating from the walking and transit city eras of urban development, therefore supporting walkability, transit, and biking
3. historicity and identity (the nexus of people, historic architecture, and urban design)
4. a transit-centric mobility infrastructure that frees people from dependence on the automobile
5. the steady employment engine of the federal government

And that they need to be all over Metrorail and Metrobus in terms of management and oversight.  (For more than a decade I suggested that DC create a Transportation Commission, comparable to the Zoning Commission, to provide greater opportunities for oversight and involvement, both for elected and appointed officials, and citizen members. And that the WMATA Board should be elected.)

Just like DC's public housing fiasco, where 25% of the units are uninhabitable, the massive failures of Metrorail could have been avoided through the execution of sound management, accountability systems, and constant, ongoing oversight.

It's an asset and risk management failure of massive proportions.

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From "Funding WMATA by a regional sales tax":

26 ways to tax to fund transit
(Based on the report, Big Move Implementation Economics: Revenue Tool Profiles, produced for Metrolinx Toronto by AECOM and KPMG)

• Auto Insurance Tax
• Car Rental Fee
• Carbon Tax (including Low/No Carbon Zones in center cities)
• Cordon/Congestion Charge
• Corporate Income Tax
• Development Charges/Impact Fees
• Driver’s License Tax
• Employer Payroll Tax (Versement Transport)
• Fare Increases
• Fare Surcharges (There is a fare surcharge to use the SFO Airport via the BART system; "BART cuts surcharge for SFO workers," San Francisco Chronicle; Boston's Logan Airport is considering surcharges for passenger drop off and pickup to encourage use of transit, "Dropping off a friend at Logan? It could cost you," Boston Globe)
• Fuel Tax
• High Occupancy Tolls
• Highway Tolls
• Hotel & Accommodation Levy (Hawaii is about to approve this type of tax to help fund the commuter rail system in Honolulu, "After reaching deal, lawmakers to meet for special session on Honolulu rail funding," Hawaii News Now)
• Income Tax
• Land Transfer Tax
• Land Value Capture
• New Vehicle Sales Tax
• Parking Sales Tax
• Parking Space Levy
• Property Tax
• Sales Tax
• Tax Increment Financing (Special Assessment Districts)
• Utility Levy
• Vehicles Kilometers/Miles Traveled Fee
• Vehicle Registration Surcharges (this is allowed in Washington State, through what is called a Transportation Benefits District, and in the Puget Sound, a Regional Transit Authority fee for Sound Transit)

Public housing administration as a measure of government (in)competence

 DC received a scathing report from HUD about the failures in managing the city's public housing stock of 8,000 units, 25%--2,000-are vacant because most are uninhabitable ("D.C. Housing Authority’s leadership is failing, HUD report says," Washington Post).  From the article:

A damning, 72-page report the agency authored portrays a housing authority in disarray and at risk of defaulting on its agreement with the federal government. Auditors catalogued 82 findings of deficiencies that DCHA must make substantial progress on within three months or risk escalating actions by HUD, which delivered its findings to DCHA in recent days.

The sweeping findings detailed in the report, a copy of which was reviewed by The Washington Post, reveal dangerous conditions at properties that form one of the last lines of defense for District residents who cannot afford homes, including violence, lead-paint hazards, out-of-code plumbing, water damage and mold. A DCHA maintenance foreman told HUD evaluators that emergency work orders are not addressed at night due to safety concerns. Prospective tenants turn down units for fear of crime, the report states.

HUD noted that DCHA’s occupancy rate is the lowest of any large public housing authority in the nation, with one in four of its roughly 8,000 physical units vacant. The vacancies result in fewer people housed and millions of dollars every year in forgone income, the report said. It attributed the issue to management failure and said the vacancies have accelerated the agency’s steadily deteriorating financial condition.

The City Council is worked up about it ("D.C. Council votes for $8 billion Medicaid contracts, housing overhaul," Post).  And the leader of the DCHA board says they're working on it ("We already are working on making the D.C. Housing Authority better," Post).

Ironically, under the Williams Administration--1998-2006--the resuscitation of the DC Housing Authority was one of the city's great accomplishments, and the director, Michael Kelly, was even detailed by HUD to help fix failing authorities in Philadelphia and New York City.

What happened in the intervening 16 years?  ("DC Housing Authority Director Resigns, Post).  

Note that a couple years ago under the previous board chair, also appointed by Mayor Bowser, DCHA was tied up in a conflict of interest matter by the then President of the board, who steered contracts to his girlfriend ("D.C. Housing Authority Board Chair Neil Albert Will Resign," Washington City Paper).  The funny thing was the "girlfriend" was eminently qualified.  And successful enough that she didn't need the work.   All he needed to do was disclose and recuse and it would have been legal.  But he didn't.

How are these multiple failures not an indictment of the capacity of the DC Government to manage and act?  ("HUD report on D.C. public housing should outrage and embarrass residents," opinion column by Colbert King, Post).  From the article:

The U.S. Department of Housing and Urban Development’s scathing report on management and operational shortcomings in the D.C. Housing Authority has documented more than 80 deficiencies ranging from inadequate management to lack of knowledge of a host of basic housing functions to 220 contracts awarded in violation of DCHA procurement policy. The unearthed defects and failures are so serious that without immediate remedial action, HUD has threatened to declare the District in default of its federal contract. D.C. residents have every reason to be outraged and embarrassed by this latest government fiasco.

Among the glaring weaknesses cited was the leadership of the DCHA’s executive director, Brenda Donald. Donald, who earns a salary of $275,000, “has no experience in property development, property management or managing federal housing programs,” the audit notes. During the HUD review, Donald accepted the need for HUD-supplied training for herself and staff on critical functions of housing programs. That speaks volumes.

HUD also found a DCHA workforce lacking in the capacity to perform even the most basic financial, procurement and housing-related functions. The agency, HUD said bluntly, is failing “to provide decent, safe, and sanitary housing opportunities for residents in violation of program requirements.”

At the heart of the problem is abysmal financial and operational oversight — a searing indictment of D.C. leadership, since the DCHA’s 13-member Board of Commissioners is dominated by Mayor Muriel E. Bowser’s six D.C. Council-approved appointees and her chief of staff and deputy mayor for planning and economic development, John Falcicchio, who is an ex officio member.

John Kotter’s Eight Step Model for Leading Change

It definitely shows lack of accountability and no sense of urgency to act-2,000 units could house at least 4,000 people.  

 One of the points I make these days is boards need to have as part of their monthly reports, lists of open items.  In the case of DCHA, the number of vacant units needs to be an element of such reporting and monitoring.  

(When I was a student "activist" at the University of Michigan, I read the monthly Regent Board Meeting packet, which was the equivalent of a looseleaf folder, as many as 1,000 pages.  One of the items was a listing of all open litigation.  The way the Board reports were organized there, listing plan versus actual, and the various open items for action in many areas is a model.)

I know that technically, DC Housing Authority is a quasi-independent agency.  But it is not truly independent.  The board is appointed by the mayor and city council.  The employees are considered DC Government employees.  The agency reports to the mayor.

It's also a failure of elected officials to not see themselves as "asset managers" and "risk managers."

-- "Town-city management: "We are all asset managers now"," 2015
-- "Municipal Natural Assets Planning Initiative, British Columbia," 2018

What's up?

Performance dashboards.  I've been thinking about them a lot lately.  For example, I think that the Orange County Register dashboard on covid is best practice, and a model for how local media can present and track data.

In the summer we visited a rural area of Montana, and the kindling box for the fireplace in the cabin we were in was full of previous year's issues of the Bozeman Daily Chronicle and some farming publications.  Of course, I skimmed them all.  

And the farming section of one (although it might have been a different paper, for Idaho) had good graphics on the water levels in various reservoirs.  But the data, presented as easily understood graphics, needs to be made more widely available, beyond those involved in agriculture.

I was thinking that such a graphic needs to be built into an online water availability dashboard in the State of Utah, which faces serious drought, but it turns out as a whole the state has the lowest cost of water and a middling track record for conservation ("For Mormons, a perfect lawn is a godly act. But the drought is catching up with them," Guardian).

Similarly, an online dashboard for a public housing authority, also made available to citizens, should have data on the number of unavailable units, overall, and by building, with the budgeted/expected percentage, which I think should be less than 5%, and the length of time each unit is out of service.

Weird intra-governmental spat in DC over the Washington Nationals stadium

Events DC is a DC government instrumentality.  

-- board of directors
-- staff

Technically it's independent of the city government, but its top officer and board members are appointed by the Mayor and City Council.  It holds the city's financial interest in facilities like Washington Nationals stadium, the Wizards practice facility, the RFK complex, the Convention Center, etc.

It's not particularly forward thinking when it comes to its facilities and urban planning ("The time to plan for retail in and around the Convention Center was long before it opened in 2003 and certainly before 2015," 2015, "Yes, modify and extend the RFK Campus lease; No, don't do it for the Washington Redskins football team," 2018), but then again, the city government's commitment to planning is constantly shrinking and diminishing too.

Flickr photo.

The Washington Post reports ("D.C. threatens to shut down Nationals Park, putting events at risk") that the Department of Consumer and Regulatory Affairs, which is responsible for building regulation, is threatening to not renew the certificate of occupancy for Washington Nationals stadium--which is owned by the city and rented by the Washington Nationals baseball team--because Events DC hasn't followed through on providing related retail and commercial space development that was part of the original agreement.  From the article:

The District is playing hardball in a dispute with the owner of Nationals Park, effectively threatening to shut down the stadium if Events DC fails to develop the commercial and retail space it promised before the ballpark’s 2008 opening.

Under its original agreement with the city, Events DC had pledged to build 46,000 square feet of commercial and retail space around Nationals Park, located along the Anacostia River in the Navy Yard neighborhood. But the company — arguing that the “extremely unique circumstances” of the pandemic and other business factors have made those initial plans unworkable — now is seeking to be released from that responsibility.

If no deal is reached, the dispute could threaten games, concerts and other events scheduled to be held at the ballpark.

This is very interesting because it's one department of the city arguing with another department, both within the executive branch.  I mean, it's not like the arguing that is typical between the Executive and Legislative branches, this is an intra-government tiff.

Clearly the Mayor isn't happy with Events DC--I don't know why because I am increasingly distant from day in, day out intra-city happenings--because this wouldn't be happening otherwise.

Obviously, Events DC isn't doing what the Mayor wants.  And an attempt to deny a C/O is a very public way of saying so.

It might not even be about the Nationals Stadium specifically, but that this is the best "point of entry" in the Mayor executing her best leverage.

And it could be about the director, who is new and interim.  I guess that Greg O'Dell, long time CEO, left for the private sector a couple years ago ("Greg O’Dell Named OVG360 President for Venue Management," SportsTravel).  He's now with Oak View Group, which was created by people who had worked for years at AEG--OVG is involved in facilities for the Seattle Kraken and the New York Islanders among others.

FWIW, EventsDC is probably right that the market doesn't support adding that space, and that it would be better for the private sector spaces to be activated.  Plus, they are crappy at managing non-sports functions in their spaces.

And the Mayor probably believes she made her point, since DCRA is issuing a temporary C/O) while negotiations continue ("D.C. backs off threat to close Nationals Park," Post).

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Certificate of occupancy and sports facilities.  I didn't realize that DC didn't issue permanent C/O for sports stadiums and arenas.  NYC issues sports facilities (or at least Madison Square Garden) C/Os with a ten year term, which allows for revision of agreements and gives the city leverage.  But those facilities are all privately owned.

I like the idea of ten year terms to be able to "force" transportation demand management agreements on teams ("Framework of characteristics that support successful community development in association with the development of professional sports facilities").  But that only works if the facility is owned by the team.  In DC, only the Capital One Arena is privately owned.  

When the government owns the facility, TDM agreements need to be part of the lease with the tenant--the sports team.