Every so often, a local anti-transit or anti-tax group will write a hit piece against Metro, alleging, for a variety of reasons, that the agency’s financial crisis is made up. These pieces invariably rely on creative graph-making, conflating Metro’s primary tax-funded service with externally-funded contract service (such as that provided to Sound Transit), or making some other obvious error of fact. In this post, I’m going to present Metro’s raw data for sales tax collections and services delivered for the last decade, and explode a couple of myths in the process.
Myth #1: Metro’s revenues have increased each of the last three years. The agency has loads of money!
The chart above will be familiar to anyone who’s taken an interest in Metro’s finances, but seems to elude Metro’s drive-by fiscal critics, who’s data mysteriously always begins in 2010. It’s true that Metro’s sales tax collections have increased each of the last three years, and will increase again this year, but that omits the crucial fact that revenue fell off a cliff between 2008 and 2009, bottoming out in 2010, for a total drop of about $72 million.
Despite this plunge in revenue, the total amount of service Metro provides has dipped only very slightly. Instead, over the last three years, that hole has been filled with a combination of fare hikes and operational cost savings, along with about $344 million of one-time cash transfers, notably including $180 million from axed capital programs and $41 million from operational reserves.
Those measures, taken at the behest of elected officials, whose directive to Metro was to preserve service at all costs, are now exhausted, but an ongoing gap of about $75 million/year remains between what Metro needs to continue offering its current level of service, and what Metro’s sales tax is bringing in. Closing that gap will require either a major cut in the quantity of service Metro delivers, or new revenue, which, along with helping the dire state of County Roads, is what Prop 1 will do.
Myth #2: We keep voting to give Metro more money. Surely the agency must have lots of of it by now.
It’s true that King County voters have voted to give Metro more money several times since 2000, and so it’s natural to wonder where that “new” money went. In the long view, beyond the precipitous loss of funding due to the recession (discussed above), most of it has gone to backfill the loss of Motor Vehicle Excise Tax funding, which arose from the passage of I-695 in 1999.
Up until 2000, Metro was funded by a combination of local government MVET, and a 0.6% sales tax. When the MVET was abolished in that year, King County voters voted to fill about three-fifths of that gap with a 0.2% sales tax; the rest was made up by slashing administrative, customer service, and planning staff at Metro. (The “administrative fat cutting” the Seattle Times editorial board recently called for actually happened more than a decade ago). Metro obtained the last 0.1% of sales tax funding available to it at the end of 2006 with the passage of Transit Now; the recession began about a year later.
In addition to MVET being a more progressive tax, the amount of money brought in by the previous MVET+0.6% sales would have been both greater and more stable (in the face of recession) than what has been subsequently been raised by the 0.8% and 0.9% sales taxes. Even with all these votes, Metro’s total take of local taxes has, for the last decade, been less than before I-695, while the agency has delivered more service hours than before I-695. This, again, speaks to an agency that has already tightened its belt.
The raw data provided to me by Metro is here. The “Metro Service Delivered” lines on the charts above exclude SR99 and SR520 construction mitigation service, which is externally funded, and lasts only for the duration of those projects.