Citizen Oversight Panel Year-End Report 2014

Transcription

1 Citizen Oversight Panel Year-End Report 2014 March 2015

2 The Sound Transit Citizen Oversight Panel is a 15-member volunteer body appointed by the Sound Transit Board to oversee and monitor the implementation of Sound Move and ST2. Previous Citizen Oversight Panel reports are available upon request and on the Sound Transit website at Panel members welcome comments and input to their work and may be contacted by calling Shelly Brown, Project Manager at Citizen Oversight Panel at (206) , by at sbrown@shellybrownassociates.com or by writing to: Citizen Oversight Panel Union Station 401 South Jackson Street Seattle, WA 98104

3 March 26, 2015 Sound Transit Board The Honorable Dow Constantine, Chair 401 South Jackson Street Seattle, WA Re: Citizen Oversight Panel 2014 Year End Report Dear Chair Constantine and Board Members: This report represents the COP s eighteenth year of reporting to you and to the public our assessment of Sound Transit s performance. For the first time in many years, economic conditions have improved significantly across the region and much of the country over the prior year. Panel members convey their compliments to Sound Transit for the excellent progress that has been made in almost every area. Major Accomplishments in 2014 The University Link extension is expected to open in the first quarter of 2016, months ahead of schedule and significantly below budget. The South 200 th Street extension is also expected to open in 2016, on schedule and under budget. Construction of the Northgate extension is underway, with both tunnel boring machines in operation. Environmental work on the Lynnwood and Federal Way extensions should be complete in early The East Link extension will be baselined in 2015, and the Board has identified a preferred alternative for the Operations and Maintenance Satellite Facility. The agency was awarded a Transportation Infrastructure Finance and Innovation Act (TIFIA) loan at an interest rate significantly lower than expected, which will substantially reduce borrowing costs and thereby could potentially make $200 - $300 million available in additional bonding capacity to reinstate some of the projects deferred because of the recent recession or fund cost changes to current projects. Sound Transit and King County Metro continue their work on a transit integration project intended to improve service planning and delivery throughout the region. The agency also is working on the development of an ST3 package of transit enhancements to be put before voters in the near future. On the operating side, ridership was up strongly on all Sound Transit modes other than Tacoma Link and Paratransit. Average weekday boardings were up system wide. Boardings increased by more than 6 percent on ST Express, nearly 11 percent on Sounder, and more than 13 percent on Central Link. Cost per boarding decreased over the same period on all modes. CHAIR Josh Benaloh VICE CHAIR Philip B. Lovell Fred G. Auch Annette P. Bailes David A. Berger Robert M. Goldstein David A. Russell Stuart Scheuerman Vic Sood Harold R. Wirch The Panel is pleased that the Board s embrace of a well-defined policy of Transit Oriented Development (TOD) over the past two years has already yielded significant results.

4 A six month parking pilot launched in early 2014 holds promise for providing more reliable access to all users, in addition to limited permit parking for frequent riders, real-time customer information, and improved ride-share programs. The COP believes that adequate park and ride facilities are integral to optimizing the region s public transportation investment, and encourages the agency s continued efforts in this regard. The Panel also supports the use of paid permit parking to better leverage existing resources and to provide additional park and ride capacity as the system expands. COP Areas of Concern Capacity Constraints COP members continue to have concerns about overload conditions, particularly on ST Express. The status of Seattle as one of the fastest growing cities in the country, coupled with a dramatic increase in traffic congestion in the region in the past year, reinforces the need for a major investment in additional service. Public support for expansion of the system appears strong. The COP encourages the agency to consider using a portion of the savings associated with the lower TIFIA loan rate to reinstate ST Express hours deferred in program realignment during the recession. Partner Operating Agreements The COP has expressed concern over the years about the relatively high costs of Sound Transit s operating agreements with its partners. The contracts are currently being renegotiated, and the COP continues to encourage the agency, with the leadership of the Board, to creatively consider options with and beyond partner agencies to reduce costs and improve operating efficiencies. Sounder North For several years, the COP has expressed concern about the high operating costs and low ridership on Sounder North. While ridership grew seven percent over last year and cost per rider has dropped in the north corridor, growth on Sounder South is up 11 percent and cost per rider remains significantly less than on Sounder North. Among other suggestions, Panel members recommend that the agency consider suspending service on the north line during the winter, when frequent mudslides result in service cancellations. The COP commends the agency s new slide prevention protocol and supports its efforts to actively minimize risk by proactively cancelling scheduled service if a series of data including weather forecasts and field information indicate a slide is likely. In conclusion, the COP notes its appreciation of the candor and responsiveness of agency staff throughout the year. The Panel is particularly mindful of the work of Acting CEO Mike Harbour during the medical leave of CEO Joni Earl. Sound Transit is a strong and well-managed agency that has weathered an historic recession and is poised to provide significant new service as the economy expands. The COP believes that continued diligence toward the issues identified in this report will benefit the agency and its customers. Sincerely, CITIZEN OVERSIGHT PANEL Josh Benaloh Chair Cc: Mike Harbour

5 Citizen Oversight Panel Year-End 2014 Performance Report on Sound Transit Introduction The Sound Transit Citizen Oversight Panel (COP or Panel) is a 15-member volunteer body appointed by the Sound Transit Board to oversee and monitor the implementation, first, of Sound Move, and more recently, of ST2, the voter approved regional transit plans. The Panel prepares a yearly progress report and periodic communications to the Board as issues arise. This report covers Sound Transit s performance during 2014, using data obtained primarily from third quarter reports because fourth quarter reporting was not complete at the time of drafting. Improving Economic Conditions and Ridership Growth For the first time in many years, economic conditions in the region and across much of the country have improved significantly since the Panel s prior year-end report. Sound Transit s proposed budget for 2015 includes revenues of $932.9 million, up 1.4 percent from the 2014 budget, primarily due to higher sales tax and motor vehicle excise tax revenues. Projected outlays of $1.2 billion are 8.2 percent higher than the 2014 budget. Federal grant drawdowns, estimated at $121.4 million, are 24.7 percent lower than the 2014 budget because of lower than anticipated drawdowns for the University Link and East Link projects. Ridership has also increased impressively. In 2014, total boardings were up system wide. Boardings increased by more than 13 percent on Central Link, nearly 11 percent on Sounder, and more than 6 percent on ST Express. Despite this strong showing, boardings on Tacoma Link declined nearly 4 percent, primarily because of a decline in downtown employers and fewer Tacoma Dome special events. Cost per boarding was down on all modes. Major Accomplishments in 2014 Major progress was made this past year on all aspects of the agency s capital program. Eleven of the twelve established milestones were met. The final 2014 milestone, baselining of the East Link project, will take place in the first half of The University Link project is significantly ahead of schedule and below budget and could potentially return a portion of its federal funding. The South 200 th Link Extension is expected to open on time and is currently $20 million under budget. Safety loss time injuries for all projects are significantly below the national average. After a lengthy process the Board identified a preferred alternative for the Operations and Maintenance Satellite Facility (OMSF) necessary for completion of the East Link project. On the operations side, Sound Transit carried its highest number of riders to date, exceeding the agency s 2014 budget and its service implementation plan (SIP) by 1.9 million boardings. On the day of the Seahawks Super Bowl celebration, the system carried 50 percent more riders than on any previous single day. Cost per boarding was lower on all modes, while Citizen Oversight Panel Page 1

6 farebox recovery consistently exceeded targets. Other noteworthy efforts include the agency s adoption, after a year-long public engagement effort, of an updated long range plan that will guide investments in new services and facilities over the next 20 years. Sound Transit and King County Metro (Metro) are working on a transit integration project intended to improve service planning and delivery throughout the region. Efforts are underway to obtain additional revenue authority that would be the basis of a ballot initiative for a third series of transportation improvements known as ST3. As Sound Transit continues its transition from primarily a construction agency to a regional operating system, the state of the organization remains strong. University Link - This 3.15 mile, $1.948 billion project is an entirely underground extension of the initial light rail system from the Pine Street Stub Tunnel downtown to the University of Washington campus near Husky Stadium. It includes twin bored tunnels, a station on Capitol Hill, and a second station near Husky Stadium with a crossover. Revenue service is now scheduled to begin in the first quarter of At the end of 2014, the project was 91 percent complete, several months ahead of schedule, and approximately $150 million under budget. Remaining risks include civil to systems contract interface, software development, systems final design, installation, testing, and rail activation. Northgate Link - This 4.3 mile, $2.131 billion project will extend from the University of Washington Station north via twin-bored tunnels to underground stations at NE 45 th and NE 43 rd Streets (U District Station), and at NE 65 th and NE 67 th Streets (Roosevelt Station). The project continues via tunnel, retained cut and elevated sections to Northgate, where an elevated station and parking garage will be constructed. At the end of 2014, the project, which is scheduled to open for revenue service in September 2021, was about 16 percent complete overall, with both tunnel boring machines underway. Risks include differing site and underground conditions, including vibration thresholds under the University of Washington campus, multiple contract interfaces, construction market conditions, and third party approvals. Lynnwood Link - This project is an extension of the Northgate Link Extension from Northgate to Lynnwood, with additional service to the cities of Seattle, Shoreline, Mountlake Terrace and Lynnwood. A preferred light rail route and station alternative was identified by the Board in November 2013; a Final Environmental Impact Statement (FEIS), Board selection of the final project to build, and a Record of Decision (ROD) are anticipated early in East Link - This $3.020 billion project will expand light rail to East King County via I-90 from downtown Seattle to the Overlake Transit Center area of Redmond. To date, the agency has awarded $152 million in final design contracts. The project will be baselined in March 2015 and is expected to open for revenue service in Testing on the track bridge prototype for the Lake Washington crossing is complete. Property acquisition is underway and a Transportation Infrastructure Finance and Innovation Act (TIFIA) loan administered by the Federal Transit Administration (FTA) has been awarded. Risks include the design process, I-90 Independent Review Team (IRT) issues, timely decisions from third parties, appreciation in commercial and Citizen Oversight Panel Page 2

7 residential property values, competitiveness in the construction market, and the ST/Bellevue Memorandum of Understanding (MOU). I-90 Two Way Transit, Stage 3 - This $226 million project is integral to the East Link project, and will result in approximately four miles of full time HOV lanes for eastbound and westbound traffic on the outer I-90 roadways between Mercer Island and Seattle in addition to modifications to the direct access ramp for transit and HOVs in Bellevue to avoid conflicts with East Link columns.. Construction of the Bellevue HOV ramp modifications began in late 2014 and is scheduled to be completed in mid-2015; construction of the outside HOV lanes between Mercer Island and Seattle is began in January of 2015 and is scheduled to be completed by June Link Light Rail Operations and Maintenance Satellite Facility - This project is needed to support the Lynnwood and East Link extensions, which by 2023 will grow the light rail network from 16 to 50 miles and triple the fleet size from 62 to 180 vehicles. The current Seattle based facility can store 104 vehicles, and will reach capacity in The environmental review and site selection processes for the project were lengthy and controversial. While the project is crucial to the future light rail operations, the public expressed concern during the public comment process about perceived negative impacts at all potential locations. In July 2014, the Board identified the Burlington Northern Santa Fe (BNSF) site located south of SR 520 and north of Northeast 12 th Street in Bellevue as the preferred alternative for the project. The COP believes the agency s process and the Board s decision were appropriate. Preliminary engineering and design work including potential modifications to the site proposed by the Urban Land Institute and final environmental studies are underway. A record of decision (ROD) is expected from the FTA in the fall of South 200 th Street Link - This 1.6 mile, $383 million project is scheduled to open for service in the fall of Features include an elevated guideway, a 1,050 space parking garage, and a station at Angle Lake in the City of SeaTac. An additional 70 parking spaces are also being developed under the rail track. The project is approximately 60 percent complete and $20 million under budget. Risks include delays in receiving a Certificate of Occupancy, and complications in integrating systems and station components. The project is the first design build contract for the Link program, and as such is being monitored closely. Federal Way Link - The Link extensions from Angle Lake Station near South 200 th Street in the City of SeaTac to South 272 nd Street on the border of Federal Way was placed on hold in 2010 as part of the agency s program realignment during the Great Recession. South King County was deeply impacted by reduced tax revenues and has continued to recover more slowly than other parts of the region. In 2012 the Board authorized the agency to proceed with alternatives analysis and environmental review from Angle Lake Station to the Federal Way Transit Center near South 320 th Street. The alternatives analysis work was completed in September 2013 and the environmental review will continue through Uncertainties about project scope, budget and schedule remain high. Many Federal Way residents have expressed Citizen Oversight Panel Page 3

8 disappointment over the delays in the project and eagerly await the outcome of the design work underway. Sounder Projects - Construction on the Mukilteo Sounder Station south platform project is expected to be complete in the first quarter of The Tukwila Sounder Station is complete. The Tacoma Trestle Project to replace the existing 100 year-old single tracked wood structure with a modern double track bridge to improve passenger and commuter rail service reliability has completed preliminary engineering. The project was accelerated with the award of a Transportation Investment Generating Economic Recovery (TIGER) grant in Work required by the Federal Railroad Administration s (FRA) Positive Train Control Initiative to improve railroad safety by reducing the probability of collisions between trains is underway and scheduled to be complete as required by December 31, Areas of Progress Financial Accountability - One of the COP s chief mandates is to monitor and report on Sound Transit s financial soundness and its adherence to the agency s adopted financial policies. The COP is pleased to report that in 2014 Sound Transit received a clean independent financial audit for the sixteenth consecutive year, its twentieth clean annual Single Audit, and a clean audit from the Washington State Auditor s Office (SAO). The annual review of adherence to subarea equity procedures was also conducted and found to be in compliance with all written policies. In past years, the COP has voiced concern that the agency s budget documents did not present a clear picture of future or past budget activities or actual expenses. We are pleased that budget and financial documents have improved greatly. Information is easy to read and includes clear explanations of activities. The agency s receipt of a Government Finance Officers Association (GFOA) award for its budget presentation is a noteworthy achievement. The COP s only suggested improvement at this point is a minor one: In instances where there are large variations between budgets and actuals, it would be useful to include a brief note explaining the variation, or a reference to the relevant quarterly financial statement, where more detailed explanations are provided. The agency s proposed budget for 2015 is a comprehensive, forward looking document with well-written explanations and forecasts. Sound Transit s inhouse audit program of internally and externally conducted performance audits has identified a variety of procedural and policy improvements across agency departments. The COP actively monitors all areas of financial and performance auditing and reporting through its participation in the Audit and Reporting Committee. The Panel commends the agency for transparency of its processes and the consistently clean outcomes of its numerous audits. Transit Oriented Development - The COP notes that the Board s embrace of a well-defined policy of Transit Oriented Development (TOD) over the past two years has already yielded significant results. The Artspace Lofts adjacent to Mt. Baker Station include three levels of residential units above a ground floor retail commercial space. There are currently 200 people on a wait list for 57 units. The Capitol Hill Station project encompasses five building sites above and around the station that will be available for development when the station opens in Sound Transit is working with the neighboring community and the City of Seattle to optimize plans for the site. A request for proposals was released in July 2014 for 450 housing units, 35 to 40 percent of which will be affordable. The Othello Station project will include 108 affordable Citizen Oversight Panel Page 4

9 apartments above ground floor commercial space. Consistent with its TOD policy, Sound Transit is now engaged with its partners earlier in the design process, when TOD related project elements can most easily be identified and incorporated. Recent examples include the negotiation of air rights at the U District Station, design elements at the 120 th Street Station in Bellevue, and on-going system planning related to the Lynnwood Link extension. The COP notes this progress and compliments the Board on its more assertive TOD program. Parking Pilots The Sound Transit Board determined at its 2012 retreat that the agency s parking policy should focus on efficiency, access for transit riders, and coordination with partner agencies and cities. In March 2013, Sound Transit adopted a system access policy that identified permits, daily fees, and expanded enforcement efforts as potential new tools to manage parking. A six month pilot project based on these concepts was implemented in February 2014, at Mukilteo Station, Issaquah Transit Center, Sumner Station, and Tukwila International Boulevard Station. Staff is still studying data from the pilot, and will issue a report to the Board early in The COP supported the pilot and encourages the agency to consider making it permanent consistent with stated goals to provide limited permit parking for frequent riders, provide real-time customer information about parking availability, and facilitate improved rideshare programs. Revenue generated from the paid permit parking could be used to expand the program to other stations and park and ride lots. If made permanent, the project could be a significant step toward better managing resources that in many communities are at capacity before peak morning service has begun. ST3 Planning - The significant increases in ridership on Sound Transit and its operating partners that have occurred over the past year continue unabated, in spite of marked declines in gas prices during the same period. Traffic congestion has also worsened dramatically. Public support for expansion of the regional transit system is strong. As Sound Transit develops the fiscally constrained plan that will form the basis of ST3, the COP continues to encourage a rigorous process of developing cost and ridership estimates across alternatives so that voters can have a realistic choice when they cast their ballots in Regional Transit Integration Improvements in King County - The regional transit integration initiative created by Executive Order of King County Executive and Sound Transit Board Chair Dow Constantine in June 2014 is a welcomed effort to improve service delivery and reduce operating costs through increased efficiencies and better integration of rail and bus services operated by Sound Transit and King County Metro. The Transit Integration Report of September 2014 provides details of the efforts underway. The COP welcomes this initiative and encourages similar efforts with Sound Transit s partners in Pierce and Snohomish Counties. The Panel also notes the importance of early planning to integrate ST Express and Metro services with planned Link extensions to optimize ridership and minimize congestion, and maximize public funding for transit. Areas of Concern Citizen Oversight Panel Page 5

10 Sounder North The COP remains concerned about relatively poor performance on the Sounder north corridor. Although ridership on Sounder North is up 7 percent over last year, ridership on Sounder South increased 11 percent during the same period. Operating costs per rider on Sounder North have also improved, down almost three dollars since 2012, to slightly over $ However, that figure is still considerably higher than on Sounder South, where cost per rider is $ Mudslides continue to cause extensive service cancellations during the winter. Efforts to stabilize the slope in the corridor were developed by the BNSF and WSDOT under the state s Landslide Mitigation Action Plan. Work funded in part through Federal Railroad Administration (FRA) grants will continue into Significant additional investment is needed to create a lasting solution to the problems. The COP commends the agency s new slide prevention protocol and its efforts to actively minimize risk by proactively cancelling scheduled service if a series of data including weather forecasts and field information indicate a slide is likely. As it has in previous reports, the COP continues to recommend setting ridership benchmarks in the corridor and identifying actions to take if specific targets aren t met. The agency should redouble efforts to better align schedules with nearby ferries, invest in a targeted marketing campaign, and provide additional parking and station enhancements. Finally, panel members encourage the agency to evaluate the feasibility of seasonal service that would exclude the winter slide season. Establishing a more predictable process for service disruptions, including an alternate, scheduled bus service, would aid riders in the corridor. Cost savings from Sounder North could be applied to the north routes of ST Express in keeping with principals of subarea equity, and temporarily-idled train equipment could be rotated into service to facilitate longer-term equipment maintenance for both the north and south lines to improve overall reliability. Capacity Constraints Overcrowding, particularly on ST Express buses, is a major concern. Riders frequently report overcrowding, standees, and passengers left behind. The inability to implement 40,000 hours of new service under the ST2 program for ST Express because of program realignment as a result of the Great Recession has been felt more acutely during the past year as ridership has risen significantly. The COP encourages using at least a portion of the additional financial capacity associated with the lower than expected TIFIA loan rate to add back bus service hours originally allocated under ST2. In addition, the Panel encourages the agency to give careful consideration to expansion of ST Express service along with high capacity transit (HCT) corridors as work continues toward ST3. Park and ride facilities should also be included in the mix, as riders report existing lots at capacity as early as 6:30 AM on many parts of the system. Ultimately, capacity constraints on the system reflect the financial constraints faced by the agency. Sound Transit will never recover 30 percent of the revenue anticipated for ST2 projects but lost during the economic crisis. The agency has shown resilience along with the Puget Sound region as ridership has climbed to record numbers and the economy continues its recovery. Nevertheless, without a significant new revenue package, the outlook for robustly addressing demand is dim. Partner Operating Agreements The agency is currently in negotiations with its partners for new operating agreements. The COP has expressed concern over the years about the relatively high costs of the agreements, particularly with Metro, which is one of the five highest paying Citizen Oversight Panel Page 6

11 transit providers in the country. The Panel recognizes the complexities involved in labor negotiations and the agency s ability to influence them. However, the Panel points to the example of a 2011 agreement with Pierce Transit to take over two routes from Metro at a significantly lower cost per hour as a reminder that savings costs often requires creative approaches. The COP encourages Sound Transit, with the leadership of its board, to creatively consider options with and beyond partner agencies to reduce costs and improve operating efficiencies as negotiations continue in the year ahead. ST Express Bus Operations and Maintenance Base Sound Transit is currently evaluating sites for an operations and maintenance base for the ST Express bus fleet. This long delayed project was identified in ST2 and endorsed by the Board s Transit Operations Task Force as a means to significantly reduce the agency s costs by eliminating its existing reliance on partners to provide operations and maintenance of its fleet. The COP encourages the agency to expedite work on this project. Regional Transit Integration Improvements Needed in Pierce and Snohomish Counties As noted above, Metro and Sound Transit have begun work on a transit integration initiative that will benefit residents of King County. Similar efforts are needed in Pierce and Snohomish Counties. One of the most common concerns expressed to the COP by members of the public is the perception that little coordination takes place between the region s transit providers, with the result that money is wasted and service reduced. This issue will take on increased significance in the years ahead, as Link extensions to the north, south, and east increase the need for additional, coordinated feeder service to light rail stations and park and ride lots throughout the system. Conclusion The year ahead will present opportunities and challenges for Sound Transit. Excellent progress on the agency s capital projects reflects years of hard work by Sound Transit and its partners, and will likely result in the early opening of at least one major project in Cost per boarding has been reduced as ridership has increased. After years of decline, the regional economy is growing rapidly and ridership is following apace. The agency is working to develop a package of transit enhancements to be put before voters in the near future. The COP wishes to reiterate, as it has in the past, that the agency is strong and well-managed. Challenges related to capacity constraints, particularly overcrowding on ST Express, require continued monitoring. The Panel encourages the agency to look carefully at replacing service hours lost during the recession. The COP is hopeful that negotiation of new partner operating agreements results in lower operating costs for the agency. Despite increased ridership on Sounder North, this service continues to perform poorly in comparison to the south line and other transit modes and remains a concern to the COP. Finally, the Panel notes the exellent work of Acting CEO Mike Harbour and other agency staff during the extended medical leave of CEO Joni Earl in the past year. Citizen Oversight Panel Page 7