Posted on Categories TransportationTags , ,

SMART says it faces multimillion-dollar deficits without sales-tax renewal

Kevin Fixler, THE PRESS DEMOCRAT

The North Bay’s commuter rail system could face crippling multimillion-dollar deficits within three years if voters in Sonoma and Marin counties don’t pass a proposed sales-tax extension in March, SMART officials revealed for the first time Wednesday.

Starting in 2022, Sonoma-Marin Area Rail Transit would need to slash at least $9 million annually — about a seventh of its operating expenses — resulting in cuts to service and SMART’s workforce if the 12-member board opts not to seek early renewal of the tax next year, or if the extension is put to voters and they reject it, officials said.

The agency’s financial forecast showed operating expenses climbing from $58 million this fiscal year to about $63 million two years from now, with tax and fare revenues not expected to keep pace. The rise is driven mostly by escalating payments on debt accrued in SMART’s buildout, as well as rising labor, fuel and maintenance costs.

“We just need to call a spade a spade as we see it today,” Farhad Mansourian, SMART’s general manager, told the board. “Doing nothing is not an option and pretty bad for everybody. We’re being straightforward. We don’t want to mislead the members of the public. We want to tell them what the pains are, what the chokeholds are and what our options are.”

The newly unveiled forecast marked the first public acknowledgment by SMART officials that the 2-year-old line already faces a potentially deepening near-term shortfall in its budget. The projections did not account for the possibility of a recession, which would carve an even larger hole into the system’s budget. More than 70% of SMART’s spending on operations is supported by the quarter-cent sales tax.

It isn’t set to expire for another decade, but SMART officials say early renewal would allow them to restructure and reduce debt payments, which are now set to rise to $16 million next year and $18 million by 2022.

Without the tax renewal and financial adjustments it would support, SMART would be forced to cut commuter service in half, according to the agency’s finance chief, effectively sidelining 18 of the 36 train trips. Dozens of jobs could be also eliminated from the workforce of about 200, officials signaled.

Read more at https://www.pressdemocrat.com/news/9874597-181/smart-says-it-faces-multimillion

Posted on Categories TransportationTags , , , ,

SMART mulls early renewal of sales tax, reduction in fares for low-income riders

Kevin Fixler, THE PRESS DEMOCRAT

The North Bay’s commuter rail service will consider a plan to reduce fares for low-income riders as part of a larger proposal from SMART staff to next year seek voter renewal of the 20-year sales tax measure that’s funded the system since 2009.

The moves come as Sonoma-Marin Area Rail Transit, which launched service in August 2017, assesses its long-term financial picture with an eye on restructuring debt and accelerating its delayed full build-out.

It expects to complete the southern-most station in Larkspur by year’s end, expanding its operating line to 45 miles of the planned 70-mile corridor. But guaranteed future funding in the form of an earlier tax renewal could help the agency speed up its extension of service north to Healdsburg and Cloverdale, according to SMART staff.

“The reality is we’re a transit operation, and we need to plan ongoing operations, we need to plan expansions,” Erin McGrath, SMART’s chief financial officer told SMART’s 12-member board at its Wednesday meeting. “We can’t have ballot box uncertainty in our future. We can’t have our revenues stopping in 10 years.”

Voters in Marin and Sonoma counties together in 2008 passed the quarter-cent sales that represents SMART’s primary funding stream. Measure Q will sunset in 2029, and the agency’s staff is recommending pursuing its renewal as early as the 2020 general election, ensuring, if passed by a two-thirds majority, funding for another 20 years through 2049.

Read more at https://www.pressdemocrat.com/news/9464429-181/smart-mulls-early-renewal-of