Yesterday Metro announced a series of new savings that will reduce the overall service cut from 550,000 annual service hours to 400,000, or about 11%. Here is the bottom line for riders:

  • This month’s service cut (151,000 hours) moves forward as planned.
  • The February 2015 cuts (169,000 hours) will also occur as planned*, unless Seattle’s Prop 1 passes. In that case, those cuts will slide to June “to provide time for Seattle and other jurisdictions to enter into contracts for service.”
  • The third and fourth rounds of cuts, currently unspecified, shrink from 230,000 hours to 80,000. Metro will consolidate this into a single cut and delay it till March 2016.

How we got here, based on Metro’s handout and a conversation with Metro GM Kevin Desmond, is below the fold.

The improved short-term picture is due to new efficiency efforts, not changes in the revenue projection. This handout describes the measures. It amounts to about $10m per year in recurring savings, largely through non-wage labor costs (e.g. health care and workers’ compensation), automation, lower projected diesel prices, and reforms to Access. These savings restore many of the late-round cuts.

The big sum is a $90m one-time savings from tweaking schedules to require fewer bus purchases ($40m) and discounts on the remaining purchases ($50m). This additional cash flow is largely responsible for allowing the deferral to 2016, which has several advantages:

  • U-Link opening may create additional savings for Metro.
  • Labor arbitration will conclude well before the cuts. Desmond noted that the offer the union just rejected would have saved enough money to fund 80,000 service hours, eliminating the third cut entirely.
  • More time creates more opportunities for sales tax revenue to grow or someone to find a political solution.

Although short-term revenue projections haven’t changed since March, the long-run numbers continue to improve. Desmond said he would dedicate this money to a “stabilization fund” to avoid more agony the next time a recession kneecaps revenue.

As many of these documents point out, 400,000 is still a lot of hours and the opposite of what a growing and densifying region should be doing. Mayor Murray didn’t miss a beat on behalf of the Prop. 1 Seattle funding measure, saying, “We’re still facing deep cuts… fortunately, we now have the opportunity to not only prevent the cuts from happening, but also invest in making the bus system better in Seattle.”

Prop. 1 does have provisions for the City to direct any excess funds to address specific bus problems, though unfortunately only through additional service and not capital projects.

In an interesting side plot, King County will have to substantially revise Dow Constantine’s original four-phase cuts plan, though not the second phase that Councilmember Rod Dembowski sought to postpone. In a statement Mr. Dembowski said

It is great to see the plan that some of us on the County Council championed earlier this year, bearing fruit.  I commend the County Executive and Metro Transit’s leadership for their work to identify cost savings.

I’m also pleased that there is now consensus to delay further service cuts to allow the County Council to complete the King County Budget and for Seattle voters to act in November on Seattle’s Proposition 1. This is an approach that a majority of us on the County Council supported from the outset.

Executive Constantine’s office sent me the following statement:

What the Executive said then holds true today: Metro should not hang its hopes on the promise of higher revenues; decisions to save or cut service should follow the adopted service guidelines; and we could always add back service when we identify real savings.

When Metro rolled out the four rounds of service reductions last November, he said it was better to plan ahead and then adapt to changing circumstances, than to base policy on speculation.

*The February cuts are through committee but not yet law.

45 Replies to “Metro Defers Some Service Cuts”

  1. While I suppose it is a good thing that Metro doesn’t have to cut as many hours as projected, it’s also a bad thing. Many people voted against higher taxes because they thought Metro was bluffing. Although in the short term this is good, in the long run, it reinforces the feeling that Metro does not need additional support. The Seattle only initiative chance of passing just went down.

    1. I tend to think the Seattle chances of passing just went up. Now it isnt just: Save Metro! Its – Save Metro and get better bus service.

      The people who care about whether Metro was bluffing (still arguable) or not were never voting yes.

      1. Just the opposite. The rebounding economy pushing up Metro revenues, even further than expected, gives Seattle voters more reason to vote NO, because they perceive the tax increase as unnecessary.

      2. My support for Seattle transit proposition 1 just became more emphatic. I was holding my nose to vote to save low-productivity service. Now, I get to vote to put service where it is most needed. Hooray!!

      3. 1) The September cuts may give a dose of reality to those who think Metro is bluffing.

        2) The Seattle measure won’t save the suburbs, even if it causes a three-month delay and a slight shrinkage of their cuts.

        3) Expecting treasurers to predict the future with 100% certainty is unrealistic. People say the county “promised” the cuts would be at a certain level and then bait-and-switched. No, it was just a projection, which was inevitably going to be adjusted up or down. Predicting revenues 100% means you know how oil prices will change, when bubbles will grow and pop, what hidden corporate scandals exist and will take companies down and raise unemployment, and what hundreds of thousands of individuals decide to buy or not buy (which they themselves may not know yet).

        4) “$10m in annual savings — couldn’t they find those before approaching voters”. The savings were:

        – largely through non-wage labor costs (e.g. health care and workers’ compensation), automation: partly under Metro’s control, but these deals take time to conclude.
        – lower projected diesel prices: not under Metro’s control.
        – reforms to Access: I don’t know what this means. It’s probably under Metro’s control, but again these things take time and maybe couldn’t be completed a year ago.

    2. They are going to have to cut 400,000 hours of service. That isn’t a bluff.

      If anything, their overall strategy — to wait until the last minute to make the cuts — is vindicated. People criticized them for doing that, but had the vote passed, they would be in good shape right now. Unfortunately, they will make substantial cuts, and if we ever get more money later, it will cost a lot more just to return to the current level of service (which, as many have said, is not adequate).

    3. The Seattle only initiative chance of passing just went down.

      That’s an awfully confident claim for someone with not data to back it up. Seattleites want more service; if this could now be sold as providing that it gives people an additional reason to support it. But even if you’re right–if this motivates a “we don’t trust Metro” shift toward a no vote–there’s simply no reason to believe, based on the best knowledge we’ve got, that the kind of numbers would be anywhere near enough to make this close. We had 66% vote yes, and we’ll probably have an even more pro-transit electorate. You’re imagining an electorate that’s far more sensitive to new information than the one we’ve got actually is.

    4. If people vote no because a 550,000 hour cut became 400,000 hours, we’ve done a poor job of explaining how revenue projections work.

    5. Agreed! What’s particularly damaging is the $10m in annual savings — couldn’t they find those before approaching voters?

      1. One of the reduced costs involves health care. I work for an employer probably almost as big as Metro. Every year we hope and we pray maintaining current levels of HC benefits and costs won’t go up too much. But it’s often a surprise. Some years it’s more than anticipated, such that we have to look to cuts benefits or increase employee costs. Some years we’re pleasantly surprised. Any any rate, not, it’s very much not something an employer has much control over, nor is it an issue where they control the timetable.

        ….This is one where we can probably thank Obamacare, probably, since the gap between HC inflation and general inflation has been cut in half the last four years.

    6. I’m going to defend JayH here. A number of people did say that they voted “no” because they believed Metro was bluffing. There were newspaper editorials written to the effect that “Metro should find efficiencies instead of asking for tax dollars”. Whether these beliefs were right or wrong is immaterial: there’s reasonable evidence that a number of voters believed Metro was bluffing.

      And now Metro revises their numbers. How does that not reinforce the belief? Most people aren’t transit wonks who look at the numbers and say “oh, it’s only a small decrease in the cuts”. They see the headlines and decide “yep, Metro lied in April”.

      Sorry, but this is bad for Metro.

    7. A lot of comments above say that this is bad for Metro and the Seattle-only ballot measure because it confirms that Metro was bluffing. And in the mind of people who thought Metro was bluffing, I’m sure that’s true.

      But what’s getting missed here is, okay, people who voted no are going to vote no again, because now they KNOW Metro was bluffing. But is this really likely to cause any new no voters? That’s all that really matters, and given how well the previous measure passed within Seattle, they’d have to swing in fairly significant numbers to make a difference. And I don’t think this “bad” news is going to make that happen.

      1. Kacie, I voted yes, but I struggled with the yes vote. I think there are a ton of inefficiencies in our local transit service. I’m more annoyed with Sound Transit than I am with KC Metro but I don’t get a warm, happy feeling thinking about either of these agencies.

        You’re right: I’ll likely not change my yes vote when this comes up again. But I’m sitting on the fence. I could be swayed by bad news.

        I don’t actually consider this news all that bad: their projections were off by a significant percentage, but I’ve thought for years that our transit planners were overpaid and undertalented.

      2. There might be a few people who switch from yes to no because they don’t understand projections and budgeting and think this supports the ‘metro is lying’ narrative. There might also be some people who switch from no to yes because they don’t like the idea of paying more for the same old thing, but are willing to pay if it comes with some new service.

        I have no idea which group is likely to be larger. But I’d be completely shocked if either of them are more than around 1-2% of voters. To think voters are constantly rethinking decisions based on information like this is to simply misunderstand voting behavior. One of the most fundamental findings of voting behavior research in political science is that of all those things we, and the media, tend to assume matters in elections, the best evidence suggests most of them just don’t. How people answer two questions (“How do you feel about buses?” “How do you feel about car tabs?” would be sufficient to understand how at least 90% of voters will swing on this one.

  2. Since they did just reconfigure the cuts to do some of the same areas at the same time, does that mean that only specific areas of the county will actually feel any relief from this, while others will feel the full force of the cuts exactly as before? Sounds like a terribly uneven distribution of cuts. Federal Way, for example, now has ALL of it’s cuts in September and February. Is Federal Way SOL? It doesn’t seem that fair that (roughly speaking) Federal Way might lose 16% of bus service while other areas which were going to get reduced later might only lose roughly 5-9% (or 0% if the transit union accepted Metro’s offer)

    1. I believe the cuts are phased in accordance with the service guidelines, so if Federal Way takes the biggest hit it means Federal Way service is uniquely unproductive.

      1. Previously, the cuts were prioritized, meaning the highest priority cuts would happen first, and the lowest priority cuts would happen last. Then, last month, they de-prioritized the cuts, and instead choose to reduce each area at the same time. What that did was take some of Federal Way’s lowest priority cuts and move them into February (It looks like they did this with S. King County as a whole). But now, they are still acting as if the plan is still prioritized, meaning that some of Federal Way’s (and also south King County’s) low priority cuts (these are cuts that according to the guidelines should be the last to be considered) may not get a chance at being restored in light of the new efficiencies. This means that south King County’s cuts may all happen, while much of north King cuts will be spared, not because south King ridership is bad, but because they de-prioritized the service cuts and the dice just happened to fall in north King’s favor.

      2. They also advanced the 30 and maybe a couple other Seattle routes. The 30 was going to be replaced with the 65th Street route, but now it’s being cut earlier with no replacement.

        The NE 65th route (#71) was going to be paired with the downtown – U-District – Northgate superroute (#73). But now Metro is proposing to send the 271 to Northgate. Does that mean it has eliminated the idea of sending the 73 to Northgate? If so then the superroute if it materializes would be limited to downtown – U-District (probably 65th).

    2. Alex,

      The county — and very especially South King County — voted for cuts!!!!!!! There is no other interpretation of the vote.

      So who cares if their bus service is reduced? Seriously! Most folks there don’t want it — especially on my street! — relatively few use it, and an amazing number think it’s some kind of socialist cabal rather than a useful traffic management tool.

      Do. Not. Worry. About. Them.

      1. Look at the map:

        A larger portion of south King County approved it than east King County. Only Seattle and Vashon Island (where? Oh, south King County) appreciably approved it, other than that, basically all of non-Seattle King County generally did not approve it, which a few blue patches sprinkled in there. But which precincts voted for or against it don’t really matter to the content of the cuts, but rather apply county-wide cuts if it fails, or preserve service county-wide if it passes.

  3. I’m a bit confused about how Metro gets and can spend it’s money. It was my understanding that Metro’s capital funds and operational funds were completely separate and can’t be shifted around. According to this post, Metro is going to get most of its savings via spending less capital funds on new buses (the schedule tweaks and purchase discounts amounting to $90m). All of that savings is in capital funds, so how does that translate to more service hours, which comes out of operational funds?

      1. The capital funds being raided were artificially inflated. They were the largest capital expenditure in Metro history. Even with the ‘raid’ it will still be one of the largest capital expenditures in Metro history.

  4. It is with great pride I republish a prediction I made in the comment back on April 23rd of this year.

    “Mark, I honestly don’t believe it’s going to get ugly. This is just round 1. If you think Prop 1 losers are going to lay down, especially the agency itself, then you don’t understand government. Sit back and watch the Ratchet effect do its thing. It may take a year or two to figure out how, but there is no way this agency will allow itself to shrink.”

    1. So you are predicting that Metro won’t cut 400,000 hours. If so, that is quite a bold prediction, especially since some of those cuts are slated for later this month. Are you predicting that those cuts won’t happen? Or are those cuts not considered “shrinking”?

      1. Only 130-odd thousand hours are scheduled for this month. 400,000 hours is the total yet to be cut.

      2. Kyle,

        No; the 400,000 includes this first tranche. The article is clear on that: 151K will be cut in 10 days. 169K will be cut in February if P1 fails or some as yet undetermined number of hours will be cut in June if it succeeds. It’s not clear what will happen in June, but any cuts at that time must come from the county’s portion of the original second, third and fourth tranches, presumably in order as recently re-classified. Finally 80K will be cut a year later which will presumably be whatever is left from the fourth set of county cuts.

    2. The agency is still set to “shrink” in 9 days, so “but there is no way this agency will allow itself to shrink” will not come true (absent something huge).

    3. So Sam, you’re predicting that the September 2014 cuts scheduled to happen in a few days will miraculously not happen, or am I misinterpreting your post?

      1. Sam’s world is binary: if any part of what Sam interprets government agencies to have said at anytime in the past is shown to be in any way less than completely correct, then everything Sam has ever said is proven correct.

        There’s a famous koan that encapsulates it: “What is the sound of one Sam yapping?”

      2. If I woke up on September 27 to find that Metro has not done the cuts, that would be amazing. Not holding my breath, though. But then again, there is no way this agency will allow itself to shrink? Maybe he meant the taxation area.

        But duh, the taxation area is fixed to the whole county for Metro.

    4. It sounds like Metro will force people to vote yes at gunpoint, and stack the County Council with its lackeys. And it’s described as a big bad godzilla bureaucracy which has no public benefit.

      (I wish there were more lackeys on the County Council. Then more of the good reorganizations would have gone through earlier.)

  5. Everyone’s just biding time to the next crisis.

    The only fair way to do this is establish fair, equitable and reasonable property taxes.

    This will have the dual effect of funding civic enhancements like transit, highways and stadiums and at the same time, incentivize landholders to free more of it up for lower cost distributed housing.

      1. In all fairness (which is hard to do), it’s the voters of Washington State who pass these idiotic, bumper sticker “initiatives.” Yes, Eyman gets paid to get them on the ballot, but there’s nothing that stops voters from saying “no,” which has happened as recently as the last election.

        Coming from a state which has zero initiative process, I don’t understand why this is such a big thing, and it seems even more ludicrous to give the power of the purse directly to the people. We have a representative government for a reason and it’s the same reason why the House has the Senate as its counterpart. Asking people who have jobs of their own to balance the pros, cons, and possible outcomes of a one-paragraph statement on a proposal that is several pages long and packed with legal word wrangling (none of these properties are bad or unwarranted, just complex) is not reasonable. This is especially true when there is a ready-made group–our elected representatives–who can take the blame for any failings of the proposal since people are not predisposed to see themselves as the cause of the problem.

        (That sounds very high-and-mighty of me, so I want to be clear that I’m not saying that I do a better job of evaluating these proposals than anyone else. I’m pointing out that asking people, as a group, to do it, is fraught with negative outcomes.)

      2. Initiatives exist because the state constiution was written in the late 1800s, which was a period of populism. They didn’t want corrupt polticians or especially the railroad barons to have a stranglehold on the state, so they made a way for the people to go around them if they weren’t responsive. Other midwestern and western states that originated in the same era also have initiatives.

        The initiatives were few and mostly sensible until the 1990s or so when three things happened. (1) Tim Eyman turned the libertarian tax revolt movement into a series of initiatives, more numerous than anyone had done before. (2) Special interests like insurance companies and liquor retailers reailized the could pass laws in their favor pretty easily by hiring signature gatherers and pushing them through a public that didn’t understand the issues. (3) National political movements (culture-war, guns, taxes, abortion) started pouring money into all relevant initiatives in every state that has them.

      3. So what I’m saying is, initiatives worked pretty well until the last decade or two when they got kind of hijacked. I’m not sure if they’re a net good or a net bad now. I used to sign every initiative, out of the civic belief that every idea should get its chance at the ballot box. But now I hardly sign any of them because I’m uncertain of the sponsor’s motivations, and I’ve learned that any good initiative will keep coming back if it fails.

        The extreme example of initiatives is Switzerland, where most public decisions are decided that way and ballots have twenty questions each on issues large and small. But I have a sad feeling that what may work well in Switzerland may not work well in the US, where there’s less social cohesion and sense of civic responsibility, and more people trying to get something for their narrow interest against other people.

      4. he extreme example of initiatives is Switzerland, where most public decisions are decided that way and ballots have twenty questions each on issues large and small.

        Until about 10 years ago, the final step in naturalization in Switzerland took place at the ballot box. Your name (and, IIRC, address) appeared on the ballot in your community, and the citizenry voted yay or nay on your citizenship application.

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