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23–269 PDF 2005

KEEPING METRO ON TRACK: THE FEDERAL

GOVERNMENT’S ROLE IN BALANCING

INVESTMENT WITH ACCOUNTABILITY AT

WASHINGTON’S TRANSIT AGENCY

HEARING

BEFORE THE

COMMITTEE ON

GOVERNMENT REFORM

HOUSE OF REPRESENTATIVES

ONE HUNDRED NINTH CONGRESS

FIRST SESSION

JULY 28, 2005

Serial No. 109–65

Printed for the use of the Committee on Government Reform

(

Available via the World Wide Web: http://www.gpoaccess.gov/congress/index.html

http://www.house.gov/reform

(II)

COMMITTEE ON GOVERNMENT REFORM

TOM DAVIS, Virginia, Chairman

CHRISTOPHER SHAYS, Connecticut

DAN BURTON, Indiana

ILEANA ROS-LEHTINEN, Florida

JOHN M. MCHUGH, New York

JOHN L. MICA, Florida

GIL GUTKNECHT, Minnesota

MARK E. SOUDER, Indiana

STEVEN C. LATOURETTE, Ohio

TODD RUSSELL PLATTS, Pennsylvania

CHRIS CANNON, Utah

JOHN J. DUNCAN, JR., Tennessee

CANDICE S. MILLER, Michigan

MICHAEL R. TURNER, Ohio

DARRELL E. ISSA, California

GINNY BROWN-WAITE, Florida

JON C. PORTER, Nevada

KENNY MARCHANT, Texas

LYNN A. WESTMORELAND, Georgia

PATRICK T. MCHENRY, North Carolina

CHARLES W. DENT, Pennsylvania

VIRGINIA FOXX, North Carolina

——— ———

HENRY A. WAXMAN, California

TOM LANTOS, California

MAJOR R. OWENS, New York

EDOLPHUS TOWNS, New York

PAUL E. KANJORSKI, Pennsylvania

CAROLYN B. MALONEY, New York

ELIJAH E. CUMMINGS, Maryland

DENNIS J. KUCINICH, Ohio

DANNY K. DAVIS, Illinois

WM. LACY CLAY, Missouri

DIANE E. WATSON, California

STEPHEN F. LYNCH, Massachusetts

CHRIS VAN HOLLEN, Maryland

LINDA T. SANCHEZ, California

C.A. DUTCH RUPPERSBERGER, Maryland

BRIAN HIGGINS, New York

ELEANOR HOLMES NORTON, District of

Columbia

———

BERNARD SANDERS, Vermont

(Independent)

MELISSA WOJCIAK, Staff Director

DAVID MARIN, Deputy Staff Director/Communications Director

ROB BORDEN, Parliamentarian

TERESA AUSTIN, Chief Clerk

PHIL BARNETT, Minority Chief of Staff/Chief Counsel

(III)

C O N T E N T S

Page

Hearing held on July 28, 2005 ............................................................................... 1

Statement of:

Siggerud, Katherine, Director, Physical Infrastructure Issues, Government Accountability Office; Dana Kauffman, chairman of the board,

Washington Metropolitan Area Transit Authority; Richard White, chief

executive officer, Washington Metropolitan Area Transit Authority;

William Millar, president, American Public Transportation Association;

Robert Puentes, fellow, Metropolitan Policy Program, the Brookings

Institution; and Pauline Schneider, partner, Hunton and Williams,

member, Federal City Council ..................................................................... 16

Kauffman, Dana ........................................................................................ 51

Millar, William .......................................................................................... 107

Puentes, Robert ......................................................................................... 156

Schneider, Pauline .................................................................................... 166

Siggerud, Katherine .................................................................................. 16

White, Richard ........................................................................................... 60

Letters, statements, etc., submitted for the record by:

Cummings, Hon. Elijah E., a Representative in Congress from the State

of Maryland, prepared statement of ............................................................ 198

Davis, Chairman Tom, a Representative in Congress from the State of

Virginia, prepared statement of ................................................................... 4

Kauffman, Dana, chairman of the board, Washington Metropolitan Area

Transit Authority, prepared statement of .................................................. 54

Millar, William, president, American Public Transportation Association:

Prepared statement of ............................................................................... 149

Transite Cooperative Research Program Report 85 ............................... 108

Norton, Hon. Eleanor Holmes, a Delegate in Congress from the District

of Columbia, prepared statement of ............................................................ 8

Puentes, Robert, fellow, Metropolitan Policy Program, the Brookings Institution, prepared statement of .................................................................. 158

Schneider, Pauline, partner, Hunton and Williams, member, Federal City

Council, prepared statement of .................................................................... 168

Siggerud, Katherine, Director, Physical Infrastructure Issues, Government Accountability Office, prepared statement of .................................... 19

Watson, Hon. Diane E., a Representative in Congress from the State

of California, prepared statement of ........................................................... 195

Waxman, Hon. Henry A., a Representative in Congress from the State

of California, prepared statement of ........................................................... 192

White, Richard, chief executive officer, Washington Metropolitan Area

Transit Authority, prepared statement of .................................................. 63

Wolf, Hon. Frank R., a Representative in Congress from the State of

Virginia, prepared statement of ................................................................... 11

(1)

KEEPING METRO ON TRACK: THE FEDERAL

GOVERNMENT’S ROLE IN BALANCING

INVESTMENT WITH ACCOUNTABILITY AT

WASHINGTON’S TRANSIT AGENCY

THURSDAY, JULY 28, 2005

HOUSE OF REPRESENTATIVES,

COMMITTEE ON GOVERNMENT REFORM,

Washington, DC.

The committee met, pursuant to notice, at 10:03 a.m., in room

2154, Rayburn House Office Building, Hon. Tom Davis (chairman

of the committee) presiding.

Present: Representatives Tom Davis of Virginia, Gutknecht,

Foxx, Cummings, Watson, Van Hollen, Ruppersberger, and Norton.

Also present: Representatives Wolf, Moran of Virginia, and

Wynn.

Staff present: Melissa Wojciak, staff director; David Marin, deputy staff director/communications director; Keith Ausbrook, chief

counsel; Mason Alinger, deputy legislative director; Rob White,

press secretary; Drew Crockett, deputy director of communications;

Shalley Kim, professional staff member; Teresa Austin, chief clerk;

Todd Greenwood, legislative correspondent; Bill Womack, legislative director; Phil Barnett, minority staff director/chief counsel;

Kristin Amerling, minority general counsel; Michelle Ash, minority

chief legislative counsel; Rosalind Parker, minority counsel; Earley

Green, minority chief clerk; and Jean Gosa, minority assistant

clerk.

Chairman TOM DAVIS. The committee will come to order.

I want to thank everybody for coming today. The purpose of today’s hearing is to highlight the vital role the Washington Metropolitan Area Transit Authority plays in supporting the Federal

Government and to begin discussing the need for a reinvigorated

Federal commitment to the Metro system, one that helps ensure

Metro has what it needs to accommodate current and future ridership growth.

The Federal Government’s dependence on the Metro system is

undeniable. Hundreds of thousands of Federal employees and contractors rely on the bus and the rail service of WMATA that it provides everyday to get to and from work. In fact, half of Metro’s

peak riders are Federal employees and contractors. More than 50

Federal agencies are located adjacent to Metro stations. As we

know all too well, when Metro shuts down, the Federal Government shuts down.

2

In addition to Federal employees, every day thousands of visitors

from around the world travel to Washington, DC, and rely on the

Metro system to transport them to the many sights and landmarks

of our Nation’s Capital.

Unlike other transportation systems in the country, the Washington Metro system is a national asset. Congress has recognized

this fact three times in recent decades by authorizing and appropriating funds for construction and capital improvements to the

Metro system. As Congress has recognized in the past, Metro is an

entity in which all American taxpayers have an interest.

It is time to recognize that shared national interest, even if we

are to protect past investments and prevent the system from collapsing. It is time again for Congress to recognize Metro’s importance to Federal operations and commit to a long-term partnership

with WMATA and its member jurisdictions.

To help begin the dialog on the need for a renewed Federal investment in Metro, today I have introduced legislation that reaffirms our symbiotic relationship. This legislation amends the National Capital Transportation Act of 1969—which marked the Federal Government’s first long-term investment in the Metro system—to authorize $150 million annually over 10 years for capital

improvements and critical maintenance needs.

Recognizing that the Federal Government is not the only interested or duty-bound stakeholder in WMATA’s long-term health, the

legislation stipulates that the Federal investment will be matched

by State and local contributions. Specifically, the legislation would

require the jurisdictions making up the ‘‘WMATA Compact’’—Virginia, Maryland, and the District of Columbia—to come up with a

true dedicated funding stream to pay for their share of Metro’s

costs before the Federal funding is authorized.

This is good policy and I think, frankly, it is good politics. We can’t get consensus behind a $1.5 billion Federal commitment unless we are absolutely certain that WMATA is not going to continue

reeling from year to year, tin cup in hand, jurisdiction to jurisdiction. The current requirement of ‘‘stable and reliable’’ relief is, in

reality, anything but. Subjecting the local match to annual appropriations processes rather than having a dedicated stream set in

stone is not the wisest way to run a railroad.

In addition to requiring a commitment from State and local governments before the Federal contribution to Metro kicks in, the legislation also recognizes that the well publicized management challenges WMATA has faced in recent years have prompted calls for

enhanced oversight and accountability. Acknowledging the need to

balance new money with strengthened oversight, the legislation

would establish an inspector general to oversee the affairs of the

transit system and would require Federal representation on the

WMATA board, to be named by the General Services Administration.

These oversight and accountability mechanisms are critical if we

are to credibly move forward with the much-needed authorization

of funds.

Finally, the bill includes language dealing with the proposed sale

or lease of Metro properties in Vienna, Takoma Park, and Largo.

These provisions reflect concerns that I, Mr. Van Hollen, and Mr.

3

Wynn have about the wisdom of these proposed sales, especially at

a time when we all agree better accountability and oversight are

needed.

I, for one, have yet to see a compelling fiscal case for the sale

of the parcel in Vienna, and I have to ask if Metro is getting the

best bang for its riders’ buck. It is hard for me to make a case for

a renewed Federal investment in Metro if property is so easily disposed.

In the Vienna case, WMATA’s own project manager has acknowledged that the development would result in significant lost parking

that would seriously restrain the Vienna station. I think I have a

responsibility to ask if Metro’s capabilities and limitations are

being properly considered in regional land use planning, and

whether Metro has been complicit in illogical land use decisions. I

am hopeful, though, that we will be able to work that out. We have

had conversations with members of the board and the other stakeholders in that area.

In closing, this is the first inning of a nine inning ball game. Persuading the Federal Government to take on a new long-term relationship with the Washington Metropolitan Area Transit Authority

will itself be a long-term investment. But I am committed, as are

my colleagues, to invest the time and energy it takes to make it

happen, as are other co-sponsors of the legislation. As we work to

build support in Congress, I am optimistic that regional jurisdictions will do what needs to be done on their end to establish a dedicated funding stream for a transit system we all so heavily rely on.

I welcome today’s witnesses and I look forward to their testimony.

[The prepared statement of Chairman Tom Davis follows:]

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5

6

Chairman TOM DAVIS. I now recognize Ms. Norton.

Ms. NORTON. Thank you very much, Mr. Chairman.

I begin by thanking you, Mr. Chairman, for calling this hearing

and allowing my participation in witness selection. More important, today I thank you for your work in leading us in fashioning

a major bill that takes our committee beyond hearings to the stage

of acting on what our prior hearings and investigations have revealed.

This committee’s many hearings on WMATA have revealed a

tangled web of management and financial problems. However, we

have spent most of our time and effort investigating the system’s

management and operational problems. That, of course, is what

legislators do. We have held hearings on problems from faulty escalators that Metro seemed unable to fix, to derailments, to costly design flaws in cars Metro never caught that may have contributed

to these accidents.

We have commissioned GAO reports on Metro’s problems that

have faulted management and recommended changes. Hearings

and official investigations of such problems can provide fodder for

endless hearings, fed by press reports of mishaps, crowding and

delays, not to mention phone calls, e-mails and letters from our

own constituents.

Today’s hearing is something of a departure from hearings that

mostly chastise management and workers, and that, frankly, most

please the public because people believe that they have been heard

and that we have been responsive. You can depend on elected officials to continue today and in the future to put the people in

charge of WMATA on the hot seat. Remember, that is what we do.

However, today we focus as well on issues of Metro’s deteriorating

infrastructure that inevitably come with age and use, and the seldom investigated problem of a system overwhelmed by the inadequate funding from the regional partners, the riding public, and

the Federal Government.

Today we face the reality that it is no longer possible to neatly

separate Metro’s management and funding problems into separate

columns, because our own investigations and reports show that operations and funding have become inextricably linked. Today we

call the question on our own local jurisdictions whose costly parochialism has kept them from finding a dedicated source of funding,

as most large systems have done.

And today we turn the table on ourselves, with a bill that would

authorize money from the Federal Government—which helped fund

the construction of the system initially—not as a gift, but because

of the growing regional Federal workforce—now half of all Metro

riders—and costly and insufferable road congestion and air pollution that made a new system an imperative.

The Federal Government, of course, has become ever more dependent on Metro, so much so that it has provided valuable progressive incentives to Federal workers to take Metro instead of

cars. Ironically, these excellent subsidies to Federal employees,

rather than to Metro, may be the chief cause of today’s overcrowded cars and for demand that overtaxes the aging system’s capacity.

7

The bill we introduce today is a classic win-win that could mean

Federal funding that the region and the system have long sought.

However, it will be a lose-lose situation if any of us hang back. This

is a step I have worked to achieve for the 15 years I have been a

Member of Congress, and it is so important to the District and the

region that I am co-sponsoring the bill despite a misgiving about

unrelated language that may leave the impression that Congress is

intervening into local zoning and housing matters.

I do not have objections to the provisions requiring negotiations

with local officials, which is always appropriate, but as is my custom, I do take issue with Federal mandates that appear to be designed to overrule local negotiations or democratically achieved decisions, and particularly where affordable housing is involved in

one of the priciest regions in the country. However, Chairman

Davis has assured me that any such language is not intended to

set a precedent and that he expects resolution before the final bill.

Nothing must take our eye off the ball that has been stuck in

hearings, investigations and constituent complaints. Now is the

time to clear the field for action. The bill we introduce today takes

a step toward the most significant action for transportation in this

region since WMATA was established 40 years ago. I am pleased

to join Chairman Davis and my regional colleagues in pressing a

bill that could revitalize public transportation in the National Capital Region. I welcome today’s witnesses, whose insights can be invaluable to us as we make improvements in the bill and head toward voting on the bill in this committee.

Thank you again, Mr. Chairman.

[The prepared statement of Hon. Eleanor Holmes Norton follows:]

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Chairman TOM DAVIS. Thank you.

Mr. Wolf.

Mr. WOLF. Thank you, Mr. Chairman. Although I don’t serve on

this committee, I do appreciate your giving me this opportunity.

And I also want to publicly, at the outset, thank you for your leadership on this issue.

As you know, WMATA operates the Washington region’s transit

system, including the 108-mile Metrorail system, which is vital to

the mobility in the Nation’s Capital and the greater Washington

area.

I have been pleased, since coming to Congress in 1981, to support

WMATA and the Metro system. The regional bipartisan congressional delegation over the years has worked to ensure that the

original 103-mile system was built and worked to keep the system

operating and to expand the system to meet the growing needs.

As the former chairman of the House Transportation Appropriations Subcommittee, I was pleased to play a role in obtaining Federal funding to complete the construction of the originally designed

Metrorail system. Through that work, I know first-hand the delicate balancing of funding necessary to keep the funding there, and

I think that is why you should be congratulated for this bill.

The Metro system has been called ‘‘America’s subway,’’ and it

truly is. Not only do our constituents in the greater Washington

area rely on Metro as a commuter system to get to and from work,

but it serves hundreds of thousands of visitors. Just stop and look

today, as you get on the Metro, at the different people from all over

the Nation.

Can you imagine the area without the Metro? If we think we

have near gridlock conditions today on our highways here, where

would we be without Metro? And clearly we do have gridlock conditions on our highways today in the entire region.

As America’s subway, Metro is a unique transit system which operates as a true Federal, State and local partnership. Every level

of government benefits from the system and every level has a responsibility to ensure that the system continues to run efficiently.

Sadly, the system is not healthy. A recent four-part series in the

Washington Post pointed out the obstacles facing Metro, which I

won’t elaborate on today. A blue ribbon panel and a Heritage Foundation report have both concluded it is vital for Metro to find a

dedicated funding source to keep the system viable.

Again, I want to thank you for the leadership, and I am pleased

to support this legislation. I yield back.

[The prepared statement of Hon. Frank R. Wolf follows:]

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Chairman TOM DAVIS. Mr. Wolf, thank you. And thanks for all

the work you have done through the years in getting funding for

this system as well.

Mr. Moran.

Mr. MORAN. Thank you very much, Mr. Chairman. I thank my

colleagues for being on the panel. I appreciate your inviting me to

share this hearing with you, because I know that we are all equally

proud of the fact that we have the privilege of representing the National Capital Region in the U.S. Congress, as well as the most efficient and effective Federal workforce that any nation can boast of,

and, of course, the seat of the world’s greatest democracy.

Metro is the linchpin that literally binds all of those entities and

interests together. But Metro is confronting a crisis. Some may be

of its own making; years of deferred maintenance and a patchwork

of cobbled together State and local funding. But that is understandable when you consider the fact that Metro is the only transit system in the country without a dedicated source of revenue.

Most of its problems are in response to development beyond its

control, immense demands on regional growth, proposed expansion

of the core system—which I think is absolutely necessary—and a

surge in new ridership, for which they are to be congratulated. But

all have contributed to inconveniencing riders with service disruptions and raising doubts about Metro’s future success.

I know my colleague and friend has crafted legislation to re-establish a new Federal commitment that we desperately need to

keep Metro on track. And, in fact, your legislation, Mr. Chairman,

goes even further than the recommendations of the recent blue ribbon panel. It will provide incentives to create a dedicated local

source of revenue, which I absolutely believe is essential.

But the Federal funds it authorizes will have eight car trains on

the system during peak hours of ridership, something that my constituents on the crowded Orange Line know will be very welcome

relief. And if this legislation comes with a greater Federal say on

Metro’s board, I think that is appropriate. If the Federal Government is going to continue to be expected to foot half of the capital

costs, then there should be Federal representation. And I think a

Federal perspective might help in bringing about the kind of consensus that is necessary among sometimes competing parochial interests.

Mr. Chairman, Metrorail is an indispensable part of the solution

to our problems in the National Capital Region. Certain key road

systems should be built, obviously. But we cannot pave our way out

of our congestion problems. We estimate that there is going to be

a need for 800,000 more residential units over the next decade.

And that comes from Steve Foler. And we may well see that just

in northern Virginia. It is Metro that presents the only way to deal

with that massive expansion.

But as you know, Mr. Chairman, from our discussions over the

past week—and I understand from Ms. Norton you have had similar discussions with Ms. Norton—I have been reticent to go on this

bill. I went on because I agree with 95 percent of what is in the

bill. It is a good bill. But the 5 percent I take exception to.

We have worked together on so many issues, and I could give a

long list of them. Lorton comes to mind and any number of others.

14

But, as you know, I think you are wrong on terms of the legislation

that restricts Metro from being able to sell its property and restricts Fairfax County from being able to determine its land use

and zoning decisions. It is not in my district, I understand that, but

it sets a precedent that I think is an unfortunate land use precedent.

The only way, as Ms. Norton suggested, that we can provide affordable housing for our workforce, never mind low-income people,

for our workforce, we have to go up. There is no more land. And

if we are going to go up and still enable people to get to work and

to shop, etc., we have to have public transit where they live, so that

they can live, they can shop, they can work without having to get

into an automobile. And the only way to do that is to have much

higher density around our Metro stations.

The jurisdictions that are not willing to do that, they have to be

subsidized by those who are, and ultimately it will be D.C. and Arlington and, to some extent, Maryland suburbs who do that subsidization. I think that is wrong. I do think we ought to be focusing

our development around Metro stations with as high a density as

we can accommodate. And I don’t think the decision that you have

made with regard to the Vienna Metro is consistent with that objective. You know that, but I have to say it on the record.

Chairman TOM DAVIS. Well, I have to say on the record I am

sure your constituents in Reston will be very happy with the fact

that you have come out for much higher densities along that corridor as well, that is going to be the price. We are losing 650 parking places in Vienna under the proposed rule at this point at the

terminus of Metro. It is not in your district.

And, you know, this isn’t a precedent. You and I worked together

in the Lorton area for a land transfer down there. We got into the

land use issues. And, frankly, this is staying in the bill until my

concerns are addressed. I hope that they will be addressed. But you

brought it up, so I am going to just tell you that is the price of

poker here.

Mr. Van Hollen.

Mr. VAN HOLLEN. Thank you, Mr. Chairman and colleagues.

First of all, let me thank you, Mr. Chairman, for your leadership

in putting together the authorization legislation and reaching out

to members of the region on a bipartisan basis.

I think we all understand the critical role that Metro pays in the

economic health of this region as part of the strategy to reduce congestion and also, at the same time, to try and keep our air clean.

We have been through very hot days recently. We know the impact

of smog. And obviously to the extent we can get cars off the street

and people onto Metro, we both reduce congestion and also can

help our air quality in this region.

It is obviously an important lifeline to the Federal Government,

given the number of Federal employees that use the Metro system

and are a part of working everyday for the people of our country

through their service in the Federal Government. And it is essential in so many other ways to this region.

So I want to thank WMATA for its efforts over many, many

years. It has faced tremendous challenges and tremendous growth,

and we have seen the impact of those challenges, I think, recently

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in a number of the stories that we saw in the Washington Post and

other areas that has overwhelmed in many ways our capacity to

deal with the system on a daily basis.

This bill contains two major components, and they are tied together: one is resources; the other is accountability. On the resources front, I think we all understand that Metro, given its

growth and anticipated growth in the future, is going to require additional resources. The dedicated funding provisions in this bill will

hopefully provide a predictable and reliable source of revenue. And

the Federal component is essential, and I think it is warranted

given the fact that the Metro system is essential to the operations

of the Federal Government, and we are, of course, in our Nation’s

Capital here.

That Federal commitment I think can only be justified, however,

if we ensure Federal taxpayers that there is the accountability

piece to it, No. 1; and, No. 2, that they have some participation on

the board. And this bill deals with both those issues: on the accountability side through the creation of the inspector general, and

on the board side by allowing Federal representatives.

So I think it is a good package. We face increasing challenges

and also threats. In the aftermath of the Madrid and London bombings, we are going to have to obviously be more vigilant than ever,

and that is going to require additional resources in the system. I

know that we will have a continued oversight over the progress

Metro is making in that area and making sure that we provide for

the safety of the riders on Metro.

Let me just briefly mention one of the local provisions in this bill

that deals with Takoma Park. And I want to make it clear that the

provision in this bill does not do anything to stop the development

at the Takoma Park Metro station. It is not the intent to stop the

development at the Takoma Park Metro station. It is designed entirely to ensure that the community is given a fair opportunity to

provide input into that effort and to make sure that a number of

concerns are addressed in a fair way.

And I want to thank WMATA representatives for some of their

early meetings that have already been had with members of the

community, but we want to make sure that we have full and fair

participation of the community in that process to make sure that

the project is the very best project it can be and meet the interests

of everybody in the community.

So with that, Mr. Chairman, I thank you and I look forward to

the hearing and the work on the legislation.

Chairman TOM DAVIS. Thank you very much.

I might add our provisions don’t stop any development. That is

not our goal. Counties make land use. All we can look at is protecting Metro’s interests in this as well.

Mr. Wynn, would you care to make an opening statement?

Mr. WYNN. Thank you, Mr. Chairman. At this time I am going

to defer, but I do want to take a moment to thank you for calling

this hearing and for your initiative with regard to the Metro system. I certainly appreciate it and look forward to the hearing. And

I will have some comments perhaps later on. Thank you.

Chairman TOM DAVIS. Thank you very much. It has been a long

time since we have had this kind of Federal commitment for fundVerDate 11-MAY-2000 12:42 Oct 11, 2005 Jkt 000000 PO 00000 Frm 00019 Fmt 6633 Sfmt 6633 D:\DOCS\23269.TXT HGOVREF1 PsN: HGOVREF1
16

ing Metro, and hopefully, working together with our local partners,

we can keep our investment in the system solid and keep this a

great system.

We will have our first panel. Members will have 7 days to submit

opening statements for the record. Our witness panel: Katherine

Siggerud, who is the Director of Physical Infrastructure Issues at

the Government Accountability Office; Dana Kauffman, a board

chairman for the Washington Metropolitan Area Transit Authority,

no stranger to us; and Richard White, the chief executive officer,

Washington Metropolitan Area Transit Authority.

And thank you, Dana, for being here.

I might add Dana serves on the County Board in Fairfax and

served under Joe Alexander, who is also a former chair. Thanks for

being here, Dana.

William Millar, the president of the American Public Transportation Association. Thank you for being here.

Robert Puentes, who is a fellow at the Metropolitan Policy,

Brookings Institute; and Pauline Schneider, who is a partner at

Hunton and Williams, and a member of the Federal City Council.

It is our policy we swear witnesses in before we testify, so just

rise and raise your right hands.

[Witnesses sworn.]

Chairman TOM DAVIS. Thank you very much.

Ms. Siggerud, you have done a lot of work on this. Why don’t you

start, and then we will move right down the line. Your entire testimony is part of the record and questions will be based on the entire

testimony.

Ms. Siggerud, thank you for being with us.

STATEMENTS OF KATHERINE SIGGERUD, DIRECTOR, PHYSICAL INFRASTRUCTURE ISSUES, GOVERNMENT ACCOUNTABILITY OFFICE; DANA KAUFFMAN, CHAIRMAN OF THE

BOARD, WASHINGTON METROPOLITAN AREA TRANSIT AUTHORITY; RICHARD WHITE, CHIEF EXECUTIVE OFFICER,

WASHINGTON METROPOLITAN AREA TRANSIT AUTHORITY;

WILLIAM MILLAR, PRESIDENT, AMERICAN PUBLIC TRANSPORTATION ASSOCIATION; ROBERT PUENTES, FELLOW,

METROPOLITAN POLICY PROGRAM, THE BROOKINGS INSTITUTION; AND PAULINE SCHNEIDER, PARTNER, HUNTON AND

WILLIAMS, MEMBER, FEDERAL CITY COUNCIL

STATEMENT OF KATHERINE SIGGERUD

Ms. SIGGERUD. Mr. Chairman, members of the committee, and

members of the Washington area delegation, I am pleased to testify

before you today on issues related to the Washington Metropolitan

Area Transit Authority [WMATA].

Recently, a regional panel reviewed WMATA’s funding and found

that it faces substantial financial and budgetary challenges. Last

month, the Washington Post series article also outlined operational

issues that affect the reliability of its transit services.

At the same time, ridership is at an all-time high, making

WMATA the second largest rail system and the fifth largest bus

system in the country. It is imperative that WMATA remain an

adequately funded and well managed organization because it proVerDate 11-MAY-2000 12:42 Oct 11, 2005 Jkt 000000 PO 00000 Frm 00020 Fmt 6633 Sfmt 6633 D:\DOCS\23269.TXT HGOVREF1 PsN: HGOVREF1
17

vides an indispensable transit option for hundreds of thousands of

Washington area commuters, including Federal Government employees; also for tourists and others who travel in the region every

day.

My statement today is based on the interim results of work that

you requested that GAO undertake. I will discuss first WMATA’s

responsibilities for serving the interest of the Federal Government

and the Washington region; second, the current funding challenges

facing WMATA and options proposed; and, third, options in providing safeguards and oversight of any additional Federal assistance

provided to WMATA should Congress decide to do so.

Turning now to my first topic. Using data from WMATA’s 2002

passenger survey, a significant portion of Metrorail riders were

Federal employees at that time. Estimates for the peak period

times were that 41 percent of the riders are Federal employees and

37 percent in the afternoon peak period. Looking at this issue another way, about 40 percent of Federal employees use Metrorail.

Federal agencies specifically rely on WMATA’s services. OPM

considers Metro’s operating status as to be key to the decisions

about closing the Federal Government in times of emergency. The

General Services Administration and the National Capital Planning Commission instruct Federal agencies to locate near transit

stops as part of an effort to reduce congestion and improve air

quality.

WMATA also plays an important role in transporting people to

special events that occur because Washington is the Nation’s Capital. These include rallies, celebrations on the Mall, and inaugurations.

WMATA has also taken on significant responsibility with regard

to security of its passengers and facilities. WMATA trains first-responders in emergency management techniques at its facility in

Landover. The Metrorail system is the first in the country to equip

selected rail stations with chemical early warning systems.

WMATA has stepped up police presence in response to heightened

terrorist alerts and incurred significant overtime costs as a result.

The Federal Government has paid for a portion of these securityrelated costs.

With regard to funding, WMATA’s challenges are most acute for

its capital projects. WMATA is to be commended for the capital

planning effort it undertook, in part in response to our 2001 recommendation. Nevertheless, this plan demonstrated that the costs

of maintaining and enhancing the system exceed available resources.

A regional panel convened last September and estimated that

WMATA would have a total budgetary shortfall of $2.4 billion

through fiscal year 2015 if it went forward with the projects in its

capital improvement plan. We believe that the budgetary shortfall

may be even greater because the estimate did not include the costs

of providing paratransit services, as required under the Americans

With Disabilities Act, these costs are significant. In fact, the panel

estimated these services could result in an additional shortfall for

WMATA of about $1.1 billion.

In dealing with its funding challenges, WMATA, unlike other

major transit systems, does not have a dedicated source of revenue.

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We have noted this as the limiting factor for WMATA in reports

dated all the way back to 1979. As a result, the regional panel concluded that the Washington region does need such a source. The

panel also concluded that the Federal Government should help to

address the budgetary shortfall, particularly for capital maintenance and system enhancement, citing specifically the benefits

WMATA provides to the Washington region and to the Federal

Government. We would note that any decision to provide additional

Federal support should be balanced against competing claims on

Federal resources and consider the Federal fiscal constraints.

To the extent that this committee and the Congress as a whole

decide to provide additional funding, Congress should also have

reasonable assurances that it will be spent efficiently and effectively. Congress has long recognized the benefits of spending safeguards, especially for high-cost transportation infrastructure

projects, and of management oversight for the local agencies that

receive the funding.

I am pleased to say that, according to my discussions with your

staff, several of the safeguards we identified are under consideration. Examples include, first, matching requirements for capital

projects. Federal law has historically controlled the use of Federal

transportation funds, including instituting matching requirements

to ensure local contributions.

Second, Federal oversight through the Federal Transit Administration. This project management oversight program run by FTA

reviews transit projects to determine whether they are on time and

on budget. This oversight has been useful in monitoring several recent WMATA projects. Third, congressional oversight. This would

include specifying the types of eligible projects and also requiring

periodic reporting to Congress on plans for using Federal funds and

the results of the investment.

Finally, Congress could institute additional oversight for

WMATA. Our ongoing work shows that WMATA already has multiple oversight entities, including the FTA program, the Office of

Auditor General, and an external auditor to review the financial

statements. It has also recently sought reviews from the American

Public Transportation Association.

Nevertheless, should the Congress decide that a different approach to oversight is necessary, we hope it would be structured in

a way to complement and integrate the existing current oversight

and to inform WMATA management and its board of overall management and operational challenges.

This concludes my statements. I am happy to take questions.

[The prepared statement of Ms. Siggerud follows:]

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Chairman TOM DAVIS. Thank you very much.

Chairman Kauffman, thanks for being with us.

STATEMENT OF DANA KAUFFMAN

Mr. KAUFFMAN. Thank you. Good morning, Mr. Chairman, members of the committee, and my Congressman and friend, Jim

Moran. I am pleased to discuss the policy issues you have raised,

as well as the fundamental reforms we, as the Metro Board, are

working to implement to help improve the service to our customers.

Before I do that, however, I would like to personally thank you,

Mr. Chairman, for your draft bill. It is the first substantive proposal for transit funding that the Washington region has seen in

more than a generation, and I look forward to working with you

to make it happen, while keeping local land use decisionmaking

local.

In your invitation, you asked why Congress should again authorize funding for Metro and why its needs are dissimilar to those of

other transit systems. When Congress enacted the National Capital

Transportation Act in 1960, it recognized the necessity to create a

unique Federal financial support, declaring, ‘‘the creation of certain

major transportation facilities are beyond the financial capability of

local governments in the region.’’ Forty-five years later, Mr. Chairman, this still holds true.

WMATA is unique among transit systems across the Nation in

serving two States, the District of Columbia, and the Federal enclave. No other transit system in the Nation has the Federal Government as the primary employer in its service area. Not only is

the Federal Government the dominant consumer of Metro daily

service, it imposes a multitude of special demands for extraordinarily large events on the National Mall and security needs.

Metro, in fact, was vital in getting people home with our Nation

was attacked on September 11th. This unique importance was affirmed in the recent blue ribbon panel report which found, ‘‘Over

the past 50 years, every administration has supported Metro because of its essential nature to the Federal operations in the National Capital region.’’

Your second question asked why it is necessary to have State

and local dedicated funding and why it doesn’t exist. The 1980

Stark-Harris bill, authorizing Federal construction funds for Metro,

included a requirement for ‘‘stable and reliable’’ non-Federal funding to meet Metro’s ongoing operating and maintenance costs. The

blue ribbon panel found that the implementation of ‘‘stable and reliable’’ has fallen short of expectations.

While funding has regularly flowed to Metro, it is subject to the

annual budget and appropriations process of two States, the District of Columbia, five local jurisdictions in Virginia, and the Federal Government. Frankly, it is like passing the hat to keep the

doors of the Washington Monument open; it is funding by lowest

common denominator.

As you well know, this is perhaps the most politically complex region in the country, and devising an equitable approach to dedicated funding has been and continues to be a daunting task. It is

now time to bring the region together to reach consensus on a new

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able, dedicated funding sources so Metro does not have to reel from

one funding crisis to another.

Your next question was about the Board’s review of the Metro

budget. There are multiple layers of budget review. The Board’s

Budget Committee reviews the budget in great detail, followed by

extensive review by local government staff, formal comment by

Maryland, the District, and State and local governments in Virginia. The Board’s Budget Committee receives and discusses

monthly reports on the execution of the budget, approves all significant contracting actions, and retains authority of all programming funds it incurs after budget adoption.

All that being said, Mr. Chairman, we can do better. For the fiscal year 2007 budget, Budget Chairman Committee Gladys Mack

and I are working on adding performance measures and longer

term strategic reviews. Our Riders’ Advisory Council is also expected to weigh in on Metro’s budget.

You posed the question does the Board composition leave it vulnerable to political pressures. Well, anybody that represents the

sometimes divergent needs of Maryland, Virginia, and the District,

as well as two counties and three cities in Virginia, two counties

in Maryland, inevitably will face political tugs and pulls. The range

of opinions, backgrounds, and experiences among the stakeholders

can make consensus difficult, but, frankly, it is one of our biggest

strengths.

The political pressures on our Board are not necessarily vulnerability, but, rather, they ensure that we are sensitive and accountable to the public and the consumers we serve. Also to further ensure our accountability to our riders, we will have in place by the

end of this year a Riders’ Advisory Council to give the Board real

time feedback on the service to our customers.

You asked, with additional Federal funding, would it be appropriate to add Federal representation to the Board. Given the strong

Federal investment and interest in maintaining a healthy Metro,

many of my colleagues and I would be open to a stronger partnership with the Federal Government, including a seat on the

WMATA Board, if that participation is clearly linked to the appropriation of significant additional Federal funds.

Your final question was whether there is adequate oversight and

my opinion on the concept of adding an inspector general.

WMATA’s Office of the Auditor General is robust, with a staff of

27 that provides independent appraisals of WMATA operations and

business practices, and monitors compliance with laws and regulations. This group, which unearthed many of the concerns highlighted in recent Post stories, has been given greater procedural

authority to ensure action when future concerns are raised.

Also, in the past 4 years, Metro has been subject to 10 FDA reviews, 3 GAO reviews, 2 outside audits, and 2 peer reviews. Finally, the Board, at my request, is currently considering options for

even more effective oversight, including the possibility of having an

audit function or inspector general reporting directly to the Board.

I would like to close by extending my appreciation on behalf of

the Board for the thoughtful and rigorous process you are undertaking to examine Metro’s needs and organizational effectiveness,

and to advance the discussion of stable funding and new Federal

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funding. Like Metro or not, support its expansion or not, even our

harshest critics must acknowledge that Metrorail and bus system

is integral to any effort to keep this region moving.

This February, when I made my first remarks as Metro chairman, I said the following: ‘‘I don’t underestimate the enormous

challenge all our stakeholders will face to establish the stable and

reliable funding we need to keep America’s subway in good repair.

However, we have been talking about this since 1979. Now we

must test to see if anybody is listening.’’

Thank you, Mr. Chairman, for listening and acting.

[The prepared statement of Mr. Kauffman follows:]

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Chairman TOM DAVIS. Thank you very much, Chairman

Kauffman.

Mr. White.

STATEMENT OF RICHARD WHITE

Mr. WHITE. Good morning, Mr. Chairman and members of the

committee. Thank you for the opportunity to testify this morning,

and thank you for your longstanding support of Metro, all of you.

My name is Richard White, and I am the general manager and

chief executive officer of the Washington Metropolitan Area Transit

Authority. I request that my full statement be inserted for the

record, along with several attachments, including the answers to

the six questions posed in your invitation letter.

More than 50 years ago, the Federal Government in its region

forged a unique and vital partnership to pursue a grand vision to

design and build a rapid transit system that would serve the Federal Government and be worthy of the Nation’s Capital. Over 30

years ago, the responsibility for operating and maintaining a regional bus system was also transferred to Metro.

By any measure, Metro has succeeded beyond anyone’s expectations in meeting Congress’s goals. In fiscal year 2005, WMATA carried 344 million passenger trips on rail and bus. The original 103-

mile Metrorail regional system cost $10 billion to construct, 69 percent of which was paid for by the Federal Government. The value

of this asset represents $24 billion in today’s dollars.

I would like to submit for the record a chart that shows how Metro’s fiscal year 2006 totaled $1.6 billion operating and capital budgets, which are funded with a combination of $832 million, or 53

percent, in non-Federal funds; $579 million, or 36 percent, in fares

and other non-passenger revenues; and $179 million, or 11 percent,

in Federal funds. Metro provides an excellent return on this investment, particularly to the Federal Government.

What makes the Metro system unique among transit systems is

that Metro was built primarily to serve the Federal workforce and

to serve the National Capital area, and it has done so admirably

for decades. But Metro is now a mature system and it faces a new

set of challenges. Our infrastructure is aging; 60 percent of our

Metrorail system is more than 20 years old and the average age

of our bus fleet is 9.91 years. And daily ridership has grown by 33

percent in the last 8 years.

The cost of operations, maintenance, and rehabilitation have outstripped the funding ability of our State and local funding partners.

We need the Federal Government to help keep the system healthy

if we are going to continue to serve the Federal Government reliably.

Since the Federal Government has limited its transit support to

capital funding in recent years, I will focus my remarks on our capital funding needs.

Our State and local funding partners stepped up to the plate last

fall and signed the Metro Matters Funding Agreement, substantially increasing their funding commitments to provide $3.3 billion

in capital funds through the year 2010. Over the life of the Metro

Matters agreement, $1.7 billion, or 51 percent, is planned to come

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eral funds. The agreement envisions both continuing Federal transit formula funds and $260 million in new discretionary Federal

funding.

But the Metro Matters agreement is a short-term interim fix

through the year 2010. New agreements will need to be negotiated

and implemented by the year 2008 in order to allow lead time for

new long-term capital projects.

After an exhaustive review, the report of the Metro Funding

Panel, sponsored by the Metropolitan Washington Council of Governments, the Greater Washington Board of Trade, and the Federal

City Council was completed in January of this year and found that,

even after accounting for periodic future fare increases and inflationary adjustments to existing State and local subsidies, Metro

faces a $2.4 billion shortfall, comprised of $1.88 billion in capital

funds and $500 million in operating funds, over the next 10 years,

excluding a $1.1 billion projected shortfall associated with paratransit costs. The panel recommended the Federal Government defray 50 percent of Metro’s projected shortfall, or $940 million of the

capital shortfall, based on the Federal Government’s dependence on

Metro.

Added to the $260 million in new Federal funding anticipated in

the Metro Matters Funding Agreement, the capital shortfall is envisioned to be $1.2 billion for the Federal Government. This

amount of funding will enable Metro to continue our ongoing infrastructure renewal program, equip 75 percent of rush hour trains

with eight-car trains, purchase 275 buses, make improvements on

140 miles of bus routes, and provide other passenger amenities. It

does not include funding for fixed guideway expansion.

At the same time, we are advocating a continuing partnership

with the Federal Government in keeping the Metro system in a

state of good repair. We are also seeking State and local dedicated

funding. In fact, WMATA is the only major public transportation

system in the country without a dedicated funding source to pay

for operations and capital requirements.

The need to address this shortcoming is becoming more and more

urgent. The June 2004 report by the Brookings Institution, revealingly titled ‘‘Washington’s Metro: Deficits by Design,’’ concluded

that WMATA receives less than 2 percent of its capital and operating funding from dedicated sources, as compared to a national average of 34.7 percent.

Mr. Kauffman’s and my extended testimony describe a number

of organizational improvements designed to make our service more

reliable and our agency more accountable and responsive to the

public. I don’t deny that we have our challenges. We recognize that

we need to change the way we manage our challenges, and many

of these changes are well underway and are producing positive results. Our railcar reliability has improved 42 percent between December of last year and May of this year, and is expected to improve even further by the end of this year due to recently implemented organizational changes and contract management changes.

Overall, the availability of our 588 escalators has improved 3

percent over the past 5 years. As a result, 93 percent of the time

passengers can find a working escalator, and they can find a working elevator 97 percent of the time.

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We have been working with the disabled community to develop

a new, more rigorous and effective contract for paratransit service.

We are currently evaluating proposals and expect to award a new

contract this coming fall. In addition, in the interim, we have

added improved safeguards to our existing contract.

We have established a strict protocol for making and enforcing

audit and safety recommendations. The policy establishes procedures for resolving areas of dispute and for ensuring implementation of recommended actions. For a complete list of procedures for

the safety intervention program, please refer to attachment 3 of my

testimony.

Our message today is that the Federal Government and the region have made a substantial investment in an extremely valuable

asset that is designed to serve the Federal workforce and the National Capital Region. We must act expeditiously to protect that

substantial public investment. Now is the time to recommit to the

original Federal-State-local partnership and put Metro on a stable

funding course to avoid slipping into serious disruption.

I commit to you that we recognize and we are facing up to our

need for improvement. We look forward to working with you and

the entire National Capital Region to address this urgent matter

and to move forward with your important and timely funding initiative.

Thank you, Mr. Chairman.

[The prepared statement of Mr. White follows:]

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Chairman TOM DAVIS. Thank you very much, Mr. White.

Mr. Millar.

STATEMENT OF WILLIAM MILLAR

Mr. MILLAR. Mr. Chairman, good morning, and thank you for

having me back. I will be speaking specifically about how transit

systems around the country are—generally, oversight occurs in several different ways. Certainly, the citizen members and elected officials who serve on transit boards is a significant way; reports that

are required by Federal, State, and local governments and the audits thereto; and many transit systems have strong internal audit

departments which review various aspects of the operation. There

has also been a recent trend to the appointment of inspectors general, and I will speak specifically to those major properties who

have those points.

Starting with the first point here, the transit boards around the

country, recently, a report done through the Transit Cooperative

Research Program was completed a couple years ago, Special Report No. 85—and I would submit that for the record with my testimony.

Chairman TOM DAVIS. Without objection, it will be placed into

the record.

[The information referred to follows:]

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Mr. MILLAR. Thank you.

It surveyed a number of transit boards and chief executive officers around the country about the issues of oversight and accountability. Generally speaking, it found the transit boards are charged

to serve as the policymakers of the transit system. Transit governance includes usually strategic guidance, legal and fiduciary oversight, and customer representation. Boards frequently engage outside experts to assist them in these tasks. For example, it is very

normal for boards to hire independent external auditors to review

the accuracy of their financial accounting, but also to review internal controls and related issues.

While each transit system’s local enabling legislation provides

the board authority to govern, it generally fails to provide specific

details on the process of that governance. And given that lack of

specificity, in some instances there may be a lack of clarity between

what belongs to the board versus the day-to-day responsibilities of

the CEO and staff. Thus, frequently, in the best-run transit systems, effort is put in by both parties to make sure that line is clear

and appropriate.

Because of this, APTA’s Transit Board Member Committee has

developed guidance for its board members in the form of a handbook. The handbook points out various issues and discusses the

board’s policymaking function and defines the general rules and

principles that seem to apply.

Obviously, as I said before, different boards are governed by different statutes, so it is difficult to generalize, but in the areas of

strategic interest, budget, fiduciary matters are the main areas

where they work. Management, on the other hand, is involved in

the day-to-day operation of the system.

Interestingly enough, the report points out the importance of the

strong and solid working relationship between the CEO of the organization and the board. And, again, the most successful organizations work hard on that relationship.

With regard to the issue of Federal oversight of transit agencies,

I believe that both Ms. Siggerud’s testimony and Mr. White’s testimony spoke to the many, many different ways that the Federal

Government is involved in the oversight, whether it is specific audits that are required to receive Federal funds, such as under OMB

Circular A–133, or the Triennial Audits that the Federal Transit

Administration is required to produce, or specific audits for specific

compliance areas, such as Buy America regulations, things of that

sort. There are also audits related to post and pre-award of certain

types of procurements that are involved. So it is a very extensive

oversight required by the Federal regulations.

Most transit systems also employ an internal audit function. The

internal auditing is intended to be an independent objective assurance that the activities that are carried out, usually by the staff,

add value and improve the organization’s operations. It also usually includes a review of organizational objectives and how the activities of the staff help to meet those objectives.

Generally speaking, the audit staff has full and unrestricted access to all activities, records, data files, personnel and physical

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ital assets and the use and protection thereof, personnel performance, ethics issues involving allegations of fraud and waste. Sometimes this audit function is a separate department within the transit agency; sometimes it reports to the CEO, sometimes it reports

to the board, and sometimes it reports to both the CEO and the

board.

You asked specifically about the use of inspectors general for

oversight, and I would say this is a growing trend, particularly

among the largest transit systems. Several transit systems, including the New York Metropolitan Transportation Authority, the Nation’s largest, the Chicago Transit Authority, the Nation’s second

largest, and the Los Angeles County Metropolitan Transportation

Authority, the third largest, each employ the inspector general approach. In each case the inspector general is independent and reports to the transit board or some outside entity.

The inspectors general and their staffs generally, as with the audits before, have full and free and unrestricted access to transit

property records, reports, audits, reviews, and other information.

Usually, the inspector general prepares reports and audits of information. That information is normally made available to the public.

The inspectors general will also review adopted performance measures, those adopted by the board or required of legislatures, and

also review the performance against those. They will then typically

publicize that.

My full testimony contains additional information, and at the

right time I would be pleased to answer any questions about it.

Again, thank you, Mr. Chairman. It is my pleasure to be with you

today.

[The prepared statement of Mr. Millar follows:]

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Chairman TOM DAVIS. Thank you very much.

Mr. Puentes, thank you for being with us.

STATEMENT OF ROBERT PUENTES

Mr. PUENTES. Thank you, Mr. Chairman, members of the committee. I appreciate being invited to testify today on the unique

funding challenges of the Washington Metropolitan Area Transit

Authority.

I am Robert Puentes, a fellow with the Metropolitan Policy Program at the Brookings Institution.

As Mr. White mentioned, in June 2004, Brookings released a

paper entitled ‘‘Washington Metro: Deficits by Design.’’ This research examined the unusual financial structure of WMATA and

found that the agency’s serious budgetary challenges owe in large

part to its problematic revenue base.

I will focus my comments this morning on key elements of that

research, including the importance of a stable and dedicated revenue source for WMATA and the issue of increased oversight and

accountability.

As has been discussed this morning, because of the lack of a stable and dedicated revenue stream, WMATA must rely excessively

on general fund revenues from its partners just to keep the system

functioning. This is, of course, a difficult problem for any transit

agency, but for the fourth largest agency in the country such an

over-reliance is extraordinary and problematic for several reasons.

First, it has long been understood that the lack of a dedicated

revenue source is both unique and challenging for WMATA. As has

been mentioned this morning, a 1979 GAO report stated that competition for local revenues and the increasing burdens of property

taxes made a new and dedicated source for WMATA almost mandatory.

Another GAO report in 1983 noted that the Stark-Harris Act, which authorized $1.7 billion in Federal money for construction expenses, required the local governments to establish a stable and reliable source of revenue. According to the GAO, the purpose of this

requirement was to ensure that, once the rail system was built,

there would be sufficient revenues available to maintain and operate it. We are feeling the effects of that today.

Next, WMATA’s financial arrangement differs sharply from how

virtually all transit agencies throughout the country are funded.

You have heard that this morning as well. In terms of capital expenses, 21 percent of WMATA’s funds come from local general revenue sources in 2002, compared to less than 5 percent nationally.

On the operating side, WMATA’s 15 percent local revenue figure

compares to only about 8 percent nationally. Therefore, a significant component of WMATA’s annual funding is vulnerable to competition with other pressing local priorities and WMATA must compete each year with other basic local expenditures, such as police,

schools, and parks, as well as other transportation services.

This over-reliance on local funds puts tremendous strains on the

annual budget process. For one thing, as was mentioned, although

the local partners have reaffirmed their commitment to WMATA

over and over again, concerns that one or more partners may balk

at their annual bill are ever-present.

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In addition, the general lack of year-to-year assurance in the

budget process makes it more challenging for WMATA to plan for

large capital projects. As many projects extend and must be financed well over single-year budget cycles, a stable and dedicated

source of revenue would provide WMATA the ability to more carefully and efficiently plan and finance such projects.

Finally, a lack of stable and dedicated source of revenue also

threatens the agency’s creditworthiness. Moody’s Rating Service recently pointed out that as a multi-jurisdictional entity without a

dedicated funding source to support operations and capital needs,

WMATA is vulnerable to some degree of appropriations risk.

Among other things, this risk makes it potentially difficult and

more expensive for WMATA to borrow funds and issue bonds for

capital investments.

Mr. Chairman, for all these reasons, the need for a dedicated

source of revenue for WMATA is clear. Now, some have argued

that dedicated revenue sources could be generated and administered in the District, Virginia, and Maryland independently according to their particular preferences and traditions. However, given

that WMATA is often cited as one of the few truly regional collaborations in this metropolitan area and the wide distribution of benefits received from the service, a revenue source enacted at the regional level would certainly be preferable to patchwork of separate

local sources.

Last, it is true that the oversight and attention that the local and

State governments give to WMATA is intense, and there is no reason to assume that this scrutiny would not continue. We heard this

morning of the many ways that the oversight is continuing anyway.

Nevertheless, some measure of increased oversight and accountability should be made a condition associated with any dedicated

revenue source.

It is important to point out, though, that although increased

oversight and accountability is largely common for transit agencies,

as Mr. Millar pointed out, it is largely unprecedented when considered in the context with other Federal policy initiatives related to

surface transportation. The starkest example is the $287 billion

transportation bill that Congress will send to the President this

week. Although it is wholly related, that bill is utterly lacking in

accountability, despite the much larger price tag and ultimately

much larger impact on the Nation’s transportation system.

As my comments and research have tried to illustrate, the challenges WMATA faces are very complex and unique. WMATA does

need a stable, reliable, and dedicated source of revenue to better

maintain and operate the existing system, take the pressure off the

region’s local governments, and ensure better long-term planning

and ultimately better land use.

Certainly, pitfalls do exist. Implementation is certainly not easy.

And yet, Mr Chairman, the Washington metropolitan area cannot

afford to have a transit system that is hampered from operating at

its fullest and most efficient potential.

Thank you very much for the opportunity to appear before you

today.

[The prepared statement of Mr. Puentes follows:]

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Chairman TOM DAVIS. Thank you very much.

Ms. Schneider, thanks for being last, but not least. We appreciate

your being here.

STATEMENT OF PAULINE SCHNEIDER

Ms. SCHNEIDER. Thank you, Chairman Davis and members of the

committee. My name is Pauline Schneider. I am a partner at

Hunton and Williams, and I come here today as a member of the

blue ribbon task force that was responsible for preparing the Metro

funding report that was issued in January of this year. As a followon to my service on that task force, I have agreed to serve as vice

chair of the Business Transportation Action Coalition [BTRAC],

which was formed by the Greater Washington Board of Trade, the

Federal City Council, and the Downtown Business Improvement

District to educate the public at large and advocate for a balanced

solution to generate support for a dedicated, long-term, stable

source of funding for Metro. I applaud you this morning for introduction of your legislation that the panel is discussing.

BTRAC’s founding members, sponsors, and participating organizations all agree on one fundamental premise: we must secure a

long-term, stable, dedicated funding source for Metro to meet the

current and future needs.

The task force report indicated that there was a gap of approximately $2.4 billion needed during the next 10 years to finance Metro’s operating and capital needs. The report also emphasizes that

the Metropolitan Washington Transit Authority is unique among

major transit systems in the United States in that it has no major

source of dedicated funds. Unfortunately, WMATA must annually

appeal to two States, the District of Columbia, eight local jurisdictions, and the Federal Government for funding and support.

Without the additional $2.4 billion identified, Metro will be unable to pay for the maintenance and capital improvements necessary to counter inevitable effects of the aging system or to purchase the railcars and buses necessary to accommodate increasing

demands of expanding ridership.

Three additional points need to be made about this $2.4 billion.

This level of funding assumes: one, paratransit costs are addressed

separately; two, State and local government contributions will increase to 5.3 percent annually, as opposed to the current annual increases of 31⁄2 percent; and, three, there will continue to be modest

fare increases.

As we noted, the Metro system here gets a greater amount of its

support from the fare box than any other major transit system in

the United States. However, if State and local contributions were

frozen at the current levels, the Metro panel estimated that we

would need an additional $460 million per year from the supporting jurisdictions.

The business community is very concerned about the implications and potential adverse effects on the system of a current lack

of a dedicated source. We are not insensitive to the management

and safety issues plaguing Metro. But we feel confident that the

steps are being taken to address some of the operational problems

that were highlighted in the recent Post articles. Constant diliVerDate 11-MAY-2000 12:42 Oct 11, 2005 Jkt 000000 PO 00000 Frm 00170 Fmt 6633 Sfmt 6633 D:\DOCS\23269.TXT HGOVREF1 PsN: HGOVREF1
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gence on cost containment and organizational efficiencies are required from Metro’s management.

Notwithstanding these concerns, we do not want our transit system to experience a repeat of the deterioration, the physical and

operational decay that nearly destroyed the New York transit system in the early 1970’s. Such a downward spiral would negatively

affect our region’s mobility, economic prosperity, emergency preparedness, as well as our image as a world-class destination location.

Since this is the third most congested region in the country,

Metro is critical in providing an alternative to our increasingly

clogged roadways, since it carries the equivalent of 1,400 lane miles

of highway everyday. In addition, Metro provides the spine around

which additional new transit-oriented development can help accommodate the 2 million new residents forecasted to locate in our region over the next 25 years.

Some would argue that the Federal Government has made substantial contributions—and we agree—in the past and should not

be expected to continue those contributions. We have a different

perspective. Of the 700,000 daily users of Metro, the largest single

beneficiary is the Federal Government, with more than 40 percent

of peak hour riders being members of the Federal Government employees. Most Metro stations have been purposefully located adjacent to or in very close proximity to Federal buildings, so the enormous benefits to the Federal Government continue. Your legislation obviously recognizes this fact.

In view of these considerations, we urge you to provide the maximum Federal support necessary to help close this funding gap and

to put our Metro system back on track as it needs to be. Thank you

for the opportunity to comment, and I would be happy to answer

any questions.

[The prepared statement of Ms. Schneider follows:]

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169

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Chairman TOM DAVIS. Well, thank you very much.

Let me start by saying, as we drafted this, we basically took the

GAO report, we took some of the recommendations from some of

the other groups and moved the stable and reliable source of revenue, which has been anything but stable and reliable through the

years, and tried to move this to something more definite.

The theory here is that by holding out a good chunk of money,

that the localities and the States involved will be able to come up

with something that is dedicated. It doesn’t necessarily mean a

new tax. It can take existing revenue sources, but just dedicate

them year-to-year.

Let me start. The first question is as Metro does its budget—and

I will start, Mr. White, with you—what has stable and reliable

meant? Do you know what to count on each year, or are there years

that you would like to get a certain amount, but it becomes something that is driven by the jurisdictions deciding what they want

to give you?

Mr. WHITE. In years past, the way the process has worked is that

we generally try to identify a target through the board’s adoption

of policy guidance to the staff and how to build a budget. It has

largely been a year-to-year budget, so one of the limitations is really the inability to pretty much plan beyond the first year, certainly

from an operations point of view. On the capital side we did get

some accommodations recently with the Metro Matters Funding

Agreement, which sort of does give us some 6-year planning predictability, but it sort of ends at the end of that period.

Now, what has happened historically, Mr. Chairman, are there

times when one funding partner or more than one funding partner

is sort of unable to kind of meet its responsible share, which is determined by a very complex set of formulas, and generally what

happens is our budget guidance changes, even after the budget has

been developed, and we are asked to cut some more money or come

up with alternative ways of trying to fit in to the new affordability

definition.

Chairman TOM DAVIS. That is no way to run a railroad.

Mr. WHITE. No. It’s the lowest common denominator, budgeting

and policymaking, is really what it amounts to.

Chairman TOM DAVIS. Mr. Kauffman, do you concur with that,

having sat on the board?

Mr. KAUFFMAN. Yes, Mr. Chairman, I do. I don’t think the challenge we face is a lack of information; it is a lack of stability and

the challenges of a timeframe. We are having to whip around a

budget within the constraints of State budget timing, local budget

timing. And with your bill, that would give us more of the stability

to think longer term and to put things in place our customers need

to have.

Chairman TOM DAVIS. Mr. Puentes, should a dedicated funding

stream cover both operating and capital expenses?

Mr. PUENTES. The primary burden, I think, on the budgetary

process now is on the operating side. I think it is incumbent upon

WMATA to decide what would serve them best. But it does seem

to be that the operating subsidy—which, again, comes from local

general revenue funds, for the most part—is really where some of

the more contentious problems are, because those funds are comVerDate 11-MAY-2000 12:42 Oct 11, 2005 Jkt 000000 PO 00000 Frm 00176 Fmt 6633 Sfmt 6633 D:\DOCS\23269.TXT HGOVREF1 PsN: HGOVREF1
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peting with other highly competitive local needs—parks, schools,

open space; these issues that we talk about every day.

So on the operating side it seems to be where a lot of the attention is. But in terms of longer range planning, then I think

WMATA would argue for more of a diversity.

Chairman TOM DAVIS. One of the points the GAO argues is that

the oversight has really not been what it should have been. Is that

fair, Ms. Siggerud? And my concern is if you start getting a dedicated funding stream, does that decrease oversight? If it becomes

an automatic, does that decrease it or does the inclusion of an IG

and maybe a more active board, do these kind of things make up

for that? Any thoughts on that? I will ask you and Mr. Millar and

anybody who would like to address that.

Mr. MILLAR. In general, packages that I am familiar with around

the country, when new revenues come in, usually there is additional oversight that is brought about, either by the kinds of suggestions that your bill would include—in Pennsylvania, for example, there was a requirement for publicly adopted, publicly reported

upon performance measures, for example. So generally both happen.

Chairman TOM DAVIS. I understand. We are trying to do that.

But I am just saying right now you have to go back to each jurisdiction every year. And I am sure when Mr. Kauffman goes back

to his board and other members go back to their board, they say

how is it doing? Gee, we don’t think they are doing so well. And

they give it a scrutiny before they spend that money, because that

money is competing with schools, it is competing with public safety

and other areas.

Now, all of a sudden there is a dedicated funding stream that

goes automatically. We are putting some additional safeguards in,

but is the tendency then, with the money automatically coming in,

to take one’s eye off the ball? That is my question.

Mr. MILLAR. That has not been my experience.

Chairman TOM DAVIS. OK. That is my question.

Mr. MILLAR. That has not been my experience.

Mr. KAUFFMAN. If I could jump in, Mr. Chairman. I look at financial oversight for an organization like WMATA as being three

parts. First is the classic following the money, the second is balancing priorities and strategic thinking, and the third is responsiveness to the customers’ interest.

For following the money, Mr. Chairman, we have the FTA and

the GAO that are going to be lovingly at my side all the time, just

as they are this morning. Balancing priorities, local policymakers

on this board will ensure that the balance is there. The dedicated

funding will make strategic thinking real.

And, last, as far as responsiveness to the customer interest, we

try to do that as members of the board. We could do better, and

that is why we need that rider’s advisory counsel.

Chairman TOM DAVIS. And if the new Federal seat is created,

you would not have a problem if that seat were reserved for a

Metro rider, for example?

Mr. MILLAR. No. I think that might also make the process of

amending the compact easier, because, frankly, how big of a board

do you have to have to make things work as far as representation?

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If we have this giant phalanx, future chairmen of the board may

have an even tougher job of herding cats than I do from time to

time. But if you keep it as a reasonable number to ensure representation and that representative members include the dollars on the

table, it makes sense.

Chairman TOM DAVIS. OK. All right.

Did you want to answer that too, Mr. Puentes? Did you want to

make any comment?

Mr. PUENTES. Just to quickly chime in. Given the history of the

local governments’ involvement in WMATA over the years, and

given that, based on our experience of looking at transit agencies

and their local government relationships all across the country, it

does seem to be hard to believe that there would be any less scrutiny from the local governments on WMATA, given the bill that you

have presented here today.

There are a few agencies, I think, a few metropolitan areas in

the country where the local governments recognize the importance

of the transit system and take advantage of that as well as the

local governments have here in this region. So that certainly does

exist.

But all that being said—and this is not an indictment on

WMATA—there does seem to be a need for increased oversight and

accountability for transportation systems all throughout the country, transit, highways, what have you. So for the most part, any

kind of increased oversight and accountability is generally welcome, and from our experience is wholly necessary. Again, not an

indictment of WMATA, but, for the most part, any kind of increased accountability is certainly appropriate.

Chairman TOM DAVIS. Thank you very much.

Ms. Norton.

Ms. NORTON. Thank you, Mr. Chairman.

I would like to get to the root of this dedicated funding notion,

first by asking this question. As we look at the difficulty we have

had in this region getting anywhere on dedicated funding, first let

me ask this question. Of those systems that have dedicated funding, are any of the systems structured like our system across State

lines or across county lines? Is one of the chief obstacles here that

we are dealing with such vastly different jurisdictions, and is this

comparison entirely fair if that is the case?

I don’t know what the answer is, but if we keep comparing it as

if everybody else is exactly like us and yet they have done it, then

we look kind of stupid. Is there more to it than that; if not multijurisdiction, something else perhaps? I would welcome whoever

wants to start on that one.

Mr. PUENTES. Again, based on the research that we did particularly on this issue, your comments are very well taken. There is absolutely no agency in the country that works under a government

structure as complex as the one here in this region. I don’t believe

there is also another agency that operates multi-State. I think the

agencies in New Jersey do, but, for the most part, most of the agencies operate within single States.

So your point is very well taken. Probably the reason we are in

this State today is because of the very complex government structure that does exist, the Federal oversight, the three States, etc.

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That being said, it does make the point even more important, that

because we have these complex arrangements, it probably argues

that a regional source of revenue is more necessary in this region

than it is in some other places.

Mr. MILLAR. There are some systems that operate in at least two

States and are funded by those jurisdictions. I think of the St.

Louis Metro system. They have one form of dedicated funding on

the Missouri side of the river, another form of dedicated funding

on the Illinois side of the river. Kansas City’s system is another example. Parts of the New York system operate in three States; however, they do so under a contractual arrangement with the other

States, so I am not sure that is exactly comparable to what we see

here.

Ms. NORTON. Somebody needs to look closely at how Missouri got

two different jurisdictions to do what they do so we don’t keep

making these comparisons without getting to the complexity. Easy

comparisons confuse rather than illuminate the problem-solving I

think we must do. So I find what you have said very important,

and I will attempt to find out, at least about Missouri.

One of the reasons that you find these three jurisdictions unwilling to do dedicated funding at least two of them don’t want to tax

you for what they do in their own jurisdiction, much less for something that will go perhaps to the entire region, God forbid. Therefore, it does seem to me that we need to be far more explicit on

what dedicated funding would do for the public. I mean, they look

at the council, at the county governments, every year. They have

to pay their dues in some form or fashion.

You could argue—let me be the devil’s advocate—that, OK,

Metro and Metro board, you know that you are going to get your

dues; ‘‘approximately what they are going to be,’’ so why don’t you

do planning based on that? Since no jurisdiction could default entirely, why do you need a ‘‘dedicated source of funding?’’ What

would it mean to the problems Metro has? What would it mean to

the average rider?

Mr. KAUFFMAN. Ms. Norton, if I could begin responding to that.

Both Mr. White and I used that term ‘‘lowest common denominator,’’ and to try to make that real is the challenge on a year-to-year

basis of making the funding real to be able to serve our customer,

whatever jurisdiction has been the most fiscally strained sets the

pattern for what the funding will be.

Ms. NORTON. The absolute number, are you saying?

Mr. KAUFFMAN. Yes.

Ms. NORTON. Because it is a percentage that the formula attributes each to. What kind of variations are there in the amount

you would expect? I mean, are there really large fluctuations between what you would expect in a given year and what you get in

a given year?

Mr. KAUFFMAN. I can’t give you an exact percentage, but I know,

going back, when the District of Columbia was working through its

fiscal crisis to the great situation they are in now, that set the bar.

Maryland today is certainly looking at how to husband all of their

resources. That sets the bar.

But what this legislation that you are proposing today, that you

all are working on today, it fundamentally changes the argument.

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I look at it this way: trying to set the argument on a jurisdictionby-jurisdiction basis of, gosh, we have to step up and fund Metro.

Well, then we get into balancing all the competing priorities, etc.

But by putting this legislation on the table, it says, look folks,

if we don’t come to consensus, if we don’t stand and respond to

this, then the money goes away. So it fundamentally changes the

decisionmaking dynamics for the political leaders who have to

make it happen for the riders.

Chairman TOM DAVIS. Would the gentlelady yield?

Ms. NORTON. I will yield.

Chairman TOM DAVIS. Let me just followup on that, Mr.

Kauffman. If we were to tie funding that, in fact, if you didn’t

reach that consensus, the money goes away at a certain date—for

example, tie this—I will just pick a date, 2007. That if this wasn’t

in place in dedicated funding, that $150 million went away, would

that, you think, be more of an incentive to localities, that if they

didn’t enact this, they lose that money, as opposed to just having

an authorization bill that would be for 10 years, whenever they get

around to it?

Mr. KAUFFMAN. Well, it is unusual for a politician to ask to have

a sword tied over his or her head, but I——

Chairman TOM DAVIS. I am not asking you to endorse it, I am

just asking the practical effect.

Mr. KAUFFMAN. But I would ask, as a practical effect, I would

welcome that, because it forces us to get, yes, there may be fine

points with which we disagree, but let us come to an agreement

and come to an agreement now, while the money is here. It has to

be a clear and present risk of loss of funding to ensure that we will

come together. And I would, frankly, welcome that.

Chairman TOM DAVIS. Thank you.

OK, I am going to go with Mr. Moran first, then Mr. Van Hollen.

We will all get a shot.

Mr. MORAN. Thank you, Mr. Davis. And, again, thank you for

having the hearing and the legislation, Mr. Chairman.

In my opening remarks I spoke about finding ways to encourage

jurisdictions to allow greater densities at existing and future Metrorail stations. In the case of Arlington, the county committed to

concentrate mixed use commercial office and high-density residential development within a quarter mile of its two Metrorail corridors. A lot of people didn’t like the high density, but with that

density they were able to concentrate on just 11 percent of its land,

preserving the balance for low-density single-family residential

housing, garden style apartments, retail, and green space.

Those two rail corridors today boast more office space than Dallas, Denver, or Pittsburgh, but have nowhere near the same city’s

traffic congestion. Thirty-nine percent of those who live in the

Metro corridor take transit to work and 10 percent walk. So half

of the people that live there don’t get into an automobile to clog up

our congested roads.

More than half of the county’s tax revenue is generated from the

businesses around Metro. This steady source of revenue has enabled the county to maintain its public services and the lowest

property tax rates in the region.

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What I want to ask you is have you considered any possible legislative language that would encourage other jurisdictions to follow

Arlington’s model? I mean, have you considered taking the initiative in terms of planning in a way that would be proactive?

Mr. KAUFFMAN. Mr. Moran, I will try to begin the response to

that. One of the things that we have tried to recognize as a Metro

board is that the primacy of land use remains a local decisionmaking issue. We certainly have worked to encourage, foster what

is defined as smart growth, and we try to ensure that elements of

that are evaluated for the benefit of the Metro system. But ultimately, when it comes to what takes place on a given piece of

ground in a given jurisdiction, we rely on that being a wise decision

made in the best interest of the locality.

Mr. MORAN. Well, we are good friends, Dana, but that was sort

of a predictable response.

Mr. KAUFFMAN. But what we have done—I will augment that.

Mr. MORAN. Let me go on, because I am not going to put you

guys on the spot. Just think about it in the future.

Mr. Chairman, I want to share this with you because it does impact a great deal on the money that we are going to be fighting to

get for the Dulles rail corridor. It was always going to be that we

were going to be paddling uphill to be able to get the kind of money

that was originally projected to pay for the Dulles rail corridor.

Now we are going upstream against a current, when we are told

that the cost is going to be $2.4 billion.

I am going to say for the record, when I look at the land use

planning around the four current Metro stations that are planned

for Dulles rail, I think it is deficient, it is insufficient, and I don’t

think it justifies the kind of cost that is going to be necessitated

to pay for those four Metro stations.

And as Mr. White knows, I take serious issue with the assumptions that they are going to generate enough people using those

Metro stations to justify that capital investment at Tysons. We

need high-rise residential buildings at the Metro station. To think

that we are going to attract people to come to Metro, walk across,

for example, Route 123 to go shopping, and then lug two arms full

of products that they purchased at Tysons back to the Metro station and then go on to their place of residence is not going to happen. We need residential high rises built into those Metro stations,

and we need to provide housing for the people that are working at

Tysons.

I think that the planning at Tysons is deficient. And, yet, Metro

stands back and really says that it can say nothing or do nothing

about it, and yet you have to advocate to get that kind of funding.

And it is going to affect our ability to extend Metro where it needs

to get to, which is to Dulles rail through Reston. So this is a very

serious issue, and I want to see if either of you have any ideas as

to how we can lower that cost attributed to the four Metro stations

at Tysons Corner.

Mr. WHITE. I think you are asking two questions, Mr. Moran: the

issues associated with lowering the cost and, the second, the land

use.

Mr. MORAN. I would be happy if you respond to even one of

them.

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Mr. WHITE. I will do my best to try to answer the two as best

I can. And I think the issue of land use I would probably like to

defer to Mr. Kauffman on.

We understand that we do have a challenge on our hands. As

you know, this is a project that is under the leadership of the State

Department of Rail and Public Transportation, so in this particular

instance Metro is really one of the local partners who is a technical

agent for the project working under the leadership direction of the

State on implementing this project.

We do know that there is considerable work that needs to be

done to lower the cost of this proposal that has come in under the

public-private transportation act partnership with the Dulles transit partners——

Mr. MORAN. I am going to interrupt you, not because I don’t take

particular umbrage at your answer. You are going to give me the

answer I could have predicted. But yes or no, do you have any

plans currently under consideration that would significantly reduce

the cost at Dulles?

Mr. WHITE. Yes, sir. Yes, sir.

Mr. MORAN. At Tysons for the Dulles rail? You do?

Mr. WHITE. Yes. We are working together with the State to make

an August submittal to the Federal Transit Administration to

lower that cost into an acceptable range, and we are very focused

on trying to achieve that.

Mr. MORAN. OK. I will be anxious to see those.

I don’t want to monopolize the time. I have one other quick question, though, before Chris gets an opportunity to ask it, and it is

of Mr. Kauffman.

We are going to add 18,500 more workers at Fort Belvoir, probably at the engineer proving ground. What is the cost of extending

public transit, whether it is Metrorail or a shuttle bus or whatever,

using the Springfield station? What do you estimate is going to be

the cost to serve that vastly expanded population of workers and

the contractors that will accompany them?

Mr. KAUFFMAN. First and foremost, I want to say on the record

that I welcome the opportunities that the base closure realignment

could bring to the Richmond Highway corridor and to central

Springfield. I have to look at the costs. We have done some estimates, both in 1999 and again revisited in late 2004. They are orders of magnitude figures, Congressman Moran, and they vary

from $600,000 on up—excuse me, $600 million. I am sorry, $600

million on up.

And the challenge is not only looking at it in terms of what governments can provide, but I have already raised with some folks

how about a PPTA type of arrangement for extending a light rail

from Franconia-Springfield on to serve the area. So certainly we

would want to see some Federal seed money that could perhaps

fund the PPTA, just as we are discussing for rail to Dulles.

The other thing I just would like to answer, Mr. Moran, going

back to your last question on Tysons and whether or not it is a prudent investment of dollars. Demographically and as a job center of

Fairfax County is an urban area, but is somewhat kicking and

screaming that we are working with our citizens to help them realize that we are in fact an urban area.

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When it comes to where Tysons will be, as we speak there is a

visioning process going on. We pulled the plans for Tysons out of

our normal area plan review process and, frankly, looking at what

does Tysons as a designated key town center—not town center, but

urban center for Fairfax County, what will it look like? And I

think, Mr. Moran, by the time it is done, you will see something

that is on a par with Arlington. I have no doubt about that. And

would more than justify the rail service to it.

Mr. MORAN. Well, thank you, Mr. Kauffman. I don’t have any

time left, clearly, but I do want to thank Mr. White for his leadership. I think he is a true professional and a very responsive and

responsible one. And I thank you for all the time you have dedicated and your great leadership as well, Dana.

Thank you, Mr. Chairman.

Chairman TOM DAVIS. Thank you very much, Mr. Moran.

Mr. Van Hollen.

Mr. VAN HOLLEN. Thank you, Mr. Chairman. I want to thank all

the witnesses for their testimony this morning. Just a couple points

and then a question.

First, I just want to underscore what Chairman Davis talked

about with respect to having the Federal representative to the

board also play the role of a representative of the Metro riders, a

consumer of the Metro services. I think that is important. I applaud the creation of the advisory committee, 17-member, I believe,

advisory committee. But I do think it is also important to have,

among the key criteria for selecting the Federal representatives,

the question that they reflect the ridership and the concerns of the

ridership as well.

Second, I just wanted to mention that as part of the transportation authorization bill, which I hope will pass the House and the

Congress soon, includes a number of new start designations in the

Washington area, the Maryland part of the Washington area, including the corridor city’s transit way, which would extend the

Metro line by not necessarily Metro, but transit services beyond

Shady Grove, which, as you know, is one of the most crossed and

used terminuses on the Metro system, up beyond Shady Grove to

Clarksburg, and the goal is eventually toward Frederick. And I

look forward to working with you as we do that to relieve the congestion on I–270, which very quickly gets filled up; and having that

extension I think would help relieve a lot of that congestion.

With respect to the funding goals that you have outlined here

this morning and the projections of shortfalls in the future and how

this bill and the Federal contribution can help address those, my

question is are the future security needs of the Metro system, including our responses to the terrorist threats, are those funds included in the numbers that you have provided us this morning?

That is one question. And the other question relates to what measures are you taking now throughout the Metro system with respect

to the threat of terrorist attacks?

As I am sure you know, there have been a number of both letters

to the editors and articles in the Washington Post about riders responding to Metro’s call for people to report suspicious activity, to

report whether or not they see unattended bags and backpacks on

the Metro. And at least according to the press reports, the response

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from the Metro system has not been what it should be in terms of

quickly responding to those requests. So if you could please address

those questions.

Mr. WHITE. Yes. Thank you, Congressman, for those questions.

On the security funding, in our Metro Matters Funding Agreement there are proposed investments that have come out of two

separate vulnerability assessments that have been conducted by

the Federal Government, one by the Department of Transportation

and the second one by the Department of Homeland Security. So

they are not in the bill that the chairman has introduced; they are

separate from that under the funding agreements that have already been executed.

However, there is one major caveat and proviso: it is assumed

that those projects are 100 percent federally funded, and thus far

there have been obviously limits to the amount of investments that

the Federal Government has made on transit security. We did receive $6.5 million coming out of the $250 million that was approved

for transit security. There is an allocation that we are awaiting, it

is release of another $12 million. So there are sums of money, but

they are still quite a bit short of the need that has been identified

of about $143 million.

So the direct answer to your question is no, there is nothing in

this bill related to the security side; it is under a separate set of

assumptions that we are working on pursuing the appropriation

and authorization actions of the Congress with respect to transit

funding under the Department of Homeland Security. We know

there are a number of things that are not investment-intensive

that we can and should be doing. We do know that this money has

some target hardening that we think is very important to do, and

we believe very strongly we need to get this capital investment

money.

And, in the interim, we are continuing to work with our 10,000

employees and with our 1.2 million passenger trips each day to try

to help supplement them and have them be our eyes and ears to

look out for suspicious actions. Obviously there was one issue that

you reported just the other day that was in the newspaper that

spoke to one of the responses by one of our train operators, which

sort of drew into question how well they responded. In that particular instance, it was determined that this was really an unattended

package, it didn’t really fit the definition of what our people have

been trained to look for.

However, what the train operator should have done when they

went to that railcar to investigate that is, they should have taken

that package and done something with it, either brought it over to

a station manager or took it with them to their train operator compartment. That train operator did not do that; he left the package

behind, creating some questions in the minds of customers and

some concerns in the minds of customers. So clearly that was not

a good execution action by that train operator, and we are completing our investigation work on that and there will obviously be a

level of discipline that will have to be done in conjunction with that

less than perfect response.

As it pertains to just general threat responses, our chief is very,

very aggressive and proactive in her outreach and her review of

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best practices across the country and the world. We are attempting

to do every kind of procedure that has sort of been known and used

elsewhere in the country and the world to keep our customers and

our employees safe.

We are examining the issue of random searches. We have not implemented that measure. We would want to have a public discussion around that before we were to move in that direction, unless

circumstances absolutely dictated that we do it. She has also done

a considerable amount of outreach with the Federal family and

State and local family of law enforcement, and we really see a

higher presence of officers who are non-Metro officers than we have

ever seen before as they are now more recognizing of the risk to

our transit environment and more of a willingness on their part to

help assume the risks of law enforcement.

So this partnership has really expanded the presence of enforcement, and we will continue to try and do that as we pursue other

options, such as whether it makes sense to do inspections.

Mr. VAN HOLLEN. Mr. Chairman, if I could just briefly followup

on that.

Chairman TOM DAVIS. Sure.

Mr. VAN HOLLEN. First of all, I am not advocating the random

searches. I think you are right, you should go through a thorough

process, an open process before you make any decisions in that regard.

Let me just make sure I understand your answer to the funding response, though. My understanding is that you are about $143

million short, as of today, with respect to funds to meet some of the

security requirements that you are budgeting, is that right?

Mr. WHITE. That is correct, Congressman.

Mr. VAN HOLLEN. All right. I look forward to working with you

and the chairman on those issues. I want to also thank you, Mr.

White, and the others at Metro for your responsiveness to the questions that I know my office has raised and many others have

raised. So thank you very much.

Chairman TOM DAVIS. Mr. White, I have a couple questions I

just want to ask. On this alternative discipline policy, we note that

two bus drivers who caused injuries to people after a Metro bus

lost their control in 2000, a driver fell asleep at the wheel and hit

a pole, another one which sent six passengers to the hospital; and

they switched the driver’s job and made her a subway station manager.

In another case a driver hit a pedestrian, Patricia Ann Skinner,

a 35-year-old editor at a newsletter publishing company. The driver

had seen Skinner, honked the horn repeatedly, waved her arms,

but never applied the brakes. According to the accident investigation, it said Skinner’s life changed forever that day because she lost

a leg from the hip down. Metro paid her millions in an undisclosed

settlement, according to the Washington Post. And the driver became a subway station manager.

This isn’t how you get managers, is it?

A couple other questions. The agency continued to forge ahead

with a pilot program introduced last year called Alternative Discipline instead of suspending and docking the pay of people who

violate safety rules. Managers put a letter in their files and allowed

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the workers to stay on the job. This has undergone some criticism.

Is this still in operation? I would just get your reaction to what is

going on.

And then I would ask Mr. Millar, is this commonplace and how

is it working? Because that has been a common criticism and I

have to raise it.

Mr. WHITE. No. I appreciate the question, Mr. Chairman.

Ironically, this concept came as a cost containment measure. We

spoke about the various pressures that the Authority is under and

the various thought processes that have driven us in different directions, and the board commissioned an independent review to

come up with what are the various ideas that we can do to contain

our costs.

One of the areas was the use of overtime. As you know, if we

have an employee who is disciplined and is now off the clock, if you

will, serving a suspension, what we have to do is we have to backfill that job and pay time and a half, usually through overtime, to

someone to make up for that suspension. So the thought was that

what you would do would be have the person still serve and work

for the Authority without the need for the Authority to backfill that

position on overtime, but also to have the discipline entered into

their record so it is the progressive discipline and ultimately is

treated with seriousness. And if there is a pattern of inappropriate

behavior, it can lead up to suspensions or dismissals from the Authority.

So I think the theory was a good theory. It sort of was considered

one of the more progressive labor management approaches in terms

of how management works in a collective bargaining environment.

Sometimes it has unintended consequences.

And what we have done, Mr. Chairman, is two things: we have

carved out safety and security actions, inappropriate actions that

are defined as safety and security issues are now carved out of this

alternative discipline program that can lead to immediate suspensions or immediate dismissals; and, No. 2, it is a pilot only, and it

will continue as a pilot. We have the right to re-evaluate that together with our union and to move off of alternative discipline.

Chairman TOM DAVIS. Thank you.

Mr. KAUFFMAN. Mr. Davis.

Chairman TOM DAVIS. Yes, please, Mr. Kauffman.

Mr. KAUFFMAN. If I could piggy-back on that, perhaps using a

more recent example that was also brought up earlier, this issue

of a bag being left behind and the lack of a perceived response. As

you can imagine, we as a board were embarrassed by that and

jumped into it, quite frankly, with both feet.

And we insisted to know, first, is there standard operating procedure; do we have something in place? You know, we have asked our

riders to step up. What are we doing to step up to ensure that we

are there for our riders? We got the information back; it made

sense.

Then we insisted that management is out there and the word got

down that this is not a forgivable type of thing. We want this done,

we want it exactly enforced; we want the spot management checks

and we want disciplinary action taken, because, again, if we are to

ask our riders to be more vigilant in a time of crisis, then we need

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to be also delivering top-quality service to our riders, and we expect

the most of our employees.

Chairman TOM DAVIS. OK. Thank you.

I am going to allow Members, if they want, to stay and ask other

questions. Would you like some questions? You have just come in

here.

Mr. CUMMINGS. Yes, Mr. Chairman. I just have a few questions.

Chairman TOM DAVIS. Sure.

Mr. CUMMINGS. Thank you.

I was just wondering, this Post report, Mr. White, which says investigation also found that the agency ignored safety warnings—

and this is what I am concerned about—and failed to effectively

manage its program to transport the disabled. What is that about?

Let me tell you why I ask you that. As a member of the Transportation Committee in Baltimore, one of our biggest complaints is

coming from the disabled, and considering we are celebrating now

the 15th anniversary of ADA, I am just wondering why do we have

those problems in this day and in this age?

Mr. WHITE. Yes, Congressman Cummings. I think you have two

questions: one is on the safety side and how the management and

staff respond to that; and, second, how we are managing our disabled services, our paratransit disabled services. I think what the

review found was that in some cases we have a checkered record

of how quickly management responds to internal audit reviews and

findings, safety and quality assurance reviews and findings, all of

which result in a report, a set of findings and recommendations,

and a set of recommended corrective actions for that particular

manager or that particular department to implement.

We are not proud to say that there have been instances where

some of the management response has been much slower than it

should have been or in some cases were ignoring the kinds of recommendations that came out of these internal audit findings. That

is not an acceptable situation.

What we have now implemented recently is what I call an intervention process, where there will be clearly a system of internal reviews that will, if necessary, bucket all the way up into my office

to ensure that the corrective actions are taken. The audit department will track these. If, working cooperatively with the management of the organization, it is determined that someone is not acting appropriately or quickly, there will be an intervention process,

there will be consequences for that manager for not moving forward with that, and we will ensure that the necessary intervention

takes place.

We have a lot of good internal checks and procedures, and I

think we got all the kinds of things that a big complex agency

needs to have, but we just don’t always have perfect execution everyday, and we have to make sure that we reduce the frequency

with which that happens. So that is my answer, Congressman, to

the issue of the responses on safety and internal audit findings.

On the disabled service, this is a very difficult problem that challenges WMATA and every transit agency across the country, to

meet its responsibilities under the Americans With Disabilities Act

to provide a complementary set of paratransit services. You speak

to the problems that have happened in Baltimore. I think every

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system across the country has struggled with providing quality

service that meets the responsibilities of the ADA for disabled people who are absolutely dependent upon that service for their quality of life, and trying to ensure that service is done in a way that

is also affordable. We cannot deny trips to eligible people who have

a need to make those trips, and we are also trying to reconcile that

against all these competitive budget pressures that we are trying

to manage.

In our case, Congressman Cummings, we are seeing 20 to 25 percent annual growth rates under this paratransit contract. It started

at about $10 million 7 or 8 years ago; it is over $50 million now.

So it is an extraordinary unfunded mandate that is very difficult

for local transit agencies to respond to. We had an independent review done of this, Congressman, different ways.

We have looked at the Baltimore model. I know they have come

up with some new ways of implementing that service. We have a

new request for proposals on the street. We have a whole new way

we are going to try and deliver that service and step up Metro’s

internal capabilities to ensure that the contractor is performing

successfully.

So I think we have recognized the kinds of things that need to

be done to make the service better than it is today. We certainly

pledge to you, to the members of this committee, to our disabled

community that we are very focused on making sure that we fulfill

our responsibilities of meeting that requirement.

Mr. CUMMINGS. Let me ask you this very quickly, two things.

Your research, did they discover why it is that, I mean, that is

quite a bit, five times, I think, the increase, why that is, as far as

the need for disabled services?

And the other thing that I am concerned about is just the general idea of service to those who ride. Sometimes, you know, there

comes a point when you have to fire people, Mr. White, sadly. And

I am just wondering when I read this piece in the Post, that supervisors who exercised poor judgment or were involved in safety incidents were reassigned rather than fired.

And I know that it is hard to come by jobs and all that, and I

sympathize with people in getting jobs. But, I tell you, I think that

we owe the public excellence, and sometimes I think that they don’t

always get the excellence that they deserve. And if there is any

other kind of business that people are not presented with the kind

of service, you go out of business. I practiced law for a number of

years, and if I didn’t do the job, and do it well, I was out of business.

So, I mean, I know what you said a moment ago about the buck

possibly having to stop at your office. I would hope that it doesn’t

have to go that far. But the word has to go out that the public deserves to have excellent service.

Mr. WHITE. Yes, sir. Your point is well taken. We accept your

comment. I will take the second question first and then kind of finish back up on the paratransit side.

Absolutely, we need more management accountability. There are

people who have been dismissed from the Authority over the last

several months, at least a half a dozen very senior managers who

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aged to take early retirement. We recognize that we need to be

more active in dealing with some of the inconsistencies of management performance. I pledge to you, sir, that we are going to be

much more aggressive than we have been in the past to make sure

that management is on top of its game and it is accountable for its

performance and for its behavior.

We have designated a higher number of people who have at-will

employment status. I serve at the pleasure of the board of directors

and I am an at-will employee to my 12-member board, and we have

to have more of our managers recognize that they also have the

same degree of performance requirement and insecurity around, if

they have a track record of nonperformance, then, as an at-will employee, they may face the dismissal call. And they have to be prepared to face that and recognize that their job status is now in atwill.

That I think has shaken up a number of people in the organization who can’t fall into the comfort of a personnel and disciplinary

system that allows people to sort of skate for a while until a compelling record can be made against a management performance

that would lead to dismissal. When you are at-will, you are in an

entirely different ball game, and I think that has gotten the attention that it was intended to get inside of the organization.

On the paratransit side, the increase I think has been driven by

a number of things. We do have a very active lifestyle of disabled

people in our community, and they really have, ironically, as the

service got better, they found it to be more desirable to do and increased the utilization of the service. And then when more demand

gets put on the system, it makes it tougher to keep the reliability

up, and then the reliability seems to drop down while the demand

increases until we can get that whole thing corrected.

Another thing is that we want to make sure that only people who

are the intended users of the service, we have tightened down on

eligibility certifications to make sure that only those people who

meet the definitions of disability under ADA are qualified. And if

anybody has an individual pattern of abuse in the use of the service, like they chronically, habitually cancel their service at the last

second or they don’t show for their service call, that there are consequences, including their being removed and suspended from the

service.

So we have attempted to take some proactive steps to make sure

that the people use the service properly, only those people who are

eligible to use the service do use it, and we are trying to encourage

people financially, by offering free fares, to move on to the regular

service, the accessible Metrorail and Metro bus service, including

allowing their companion to ride for free. So we have tried to do

a set of actions that I think are designed to try and make the system perform better.

Mr. CUMMINGS. Thank you very much, Mr. Chairman.

Chairman TOM DAVIS. Thank you for your questions.

I have to get some questions on the record. I have to talk, Ms.

Siggerud, to you.

How essential do you think Metro is to the Federal Government’s

operations? Can you provide any examples of Metro’s unique contributions to those operations?

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Ms. SIGGERUD. I think it is clear from what you have heard

today that Metro is very essential to the Federal Government’s operations. There are a number of Federal policies that have led directly to that result. The siting of Federal agencies at or near transit stops and the increase in the number of benefits that Federal

employees have had available to them to encourage them to use

transit has led to I believe the statistic is about 40 percent of Federal employees using Metrorail at some point. So it is clear that the

Federal Government relies on Metro. If we look at, for example, the

case of Hurricane Isabel a few years ago, OPM decided to close the

Federal Government because Metrorail was unable to operate

above ground during those winds.

There are also a couple of unique contributions I might talk

about, some security issues. The Metro Police are full partners with

the Secret Service and the Capitol Police in terms of providing explosive detection and other kinds of security whenever the President, the Vice President, or a foreign dignitary needs that kind of

service.

Chairman TOM DAVIS. What would be the effect on the Government’s operations if Metro weren’t viable?

Ms. SIGGERUD. Well, I think we have heard a clear case that the

Federal Government does need a well functioning and well managed system. If the Metro transit service were not available, clearly

those 40 percent of employees who ride Metro would either be

using other transit services or, more likely, using our roads. We

know that Washington, DC, is in fact the second or the third—I believe the third—most congested area in the country.

Chairman TOM DAVIS. OPM claims that it does not rely on

Metro, surprisingly, in part because Federal employees could

telework instead of coming to work. Now, that really, in my opinion, doesn’t jive with the anemic telecommunicating rates that I

have seen coming out of the Federal Government. Any comment on

that?

Ms. SIGGERUD. Sure.

Chairman TOM DAVIS. It seems to be missing.

Ms. SIGGERUD. Yes. I know that you have been a very big supporter of telework and getting more Federal agencies to make that

available to their employees. But I think the reality of the situation

is that telework is appropriate for some employees and on a parttime basis, it is not a full-time solution to the mobility problems

that face our region.

Office of Personnel Management also encourages car-pooling.

That is another option to using transit. However, the Hurricane

Isabel example that I mentioned, along with the various weather

situations that hit us in the winter here, make it clear that OPM

makes decisions about the operating status of the Government that

is very clearly reliant on Metro’s operating status.

Chairman TOM DAVIS. Mr. White, how are Metro’s operations affected by these special events: inaugurations, protests? Now you

have the Nationals games, which I guess is helping ridership and

some of those areas.

Mr. WHITE. Well, those are good problems to have when we provide an essential service to the community and the kinds of things

that people come to the National Capital Region to enjoy. Some of

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those that happen every year, like the 4th of July types of events;

the inauguration, which takes place every 4 years. Some of the occasional events such as the President Reagan state funeral and

other things like that, when we find those major events that take

place, obviously the Federal response, there is a fair amount of

shutting down of the road and perimeter systems, there is a lot of

perimeter security that has taken place when hundreds of thousands of people are coming to the downtown area to try to enjoy

the festivities and the celebrations. And everybody is told and recommended to take Metro to do that.

So we are a workhorse every day; we are like a Clydesdale when

it comes to these kinds of special events in terms of the burden

that is put on Metro. Virtually every person that can work is working that particular day. We run the wheels off of every train we

have and most of the buses that we have to support those events.

So it is something we sort of built into our culture of the organization in terms of how we do that—and we are probably best when

it comes to these special events—but clearly it places a big burden

on the organization in terms of how we use our manpower and the

costs associated with it. We like to have that burden, but it is a

challenge to us nevertheless.

Chairman TOM DAVIS. The main thrust of the system has been

moving people out from the suburbs into the city to places of work.

How much are we getting that is now counter to that, people moving from the city to employment places in the suburbs? And

shouldn’t that be an object of Metro, to try to enhance that?

Mr. WHITE. Absolutely, Mr. Chairman. When the people deigned

the system some 40 years ago, it was based upon the predicted

growth patterns that were going to take place. And certainly on the

rail side, we are a radial rail system. Our job is to bring people

from the suburbs to the central city through major radial corridors

of travel. And the whole layout of the Metrorail system was based

upon those predicted travel points of origin and destination, population and employment. And I think that has been the case.

But over the last decade, I think we have seen that we have

what we call clusters of employment centers. The District of Columbia will always be the largest single job center. I don’t think

anybody is predicting that not to be the case. But there is an explosion of activity centers in the suburban areas that are their own

employment and trip generation centers that makes this travel pattern in the metropolitan area now a spider Web travel pattern; it

is no longer radial.

Chairman TOM DAVIS. Unfortunately, a lot of that is not around

Metro stations.

Mr. WHITE. And a lot of that is not around Metro. This is where

the bus system needs to play a bigger part. A rubber tire system

is much more versatile than a heavy rail fixed investment.

Chairman TOM DAVIS. But are you seeing much going out on the

blue line, the orange line? Do you see an increase now of people

coming out to the suburbs?

Mr. WHITE. There is tremendous reverse commute travel, which

is, of course, great for public transportation because it makes a

more effective use of our capacity for two-way use, rather than oneway.

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Chairman TOM DAVIS. To the extent that is enhanced, that helps

the system, right, because the trains are going there anyway?

Mr. WHITE. It absolutely does. For example, the Tysons investment that we talked about, that is a 30 percent reverse commute

corridor. That is extremely high reverse commute, and a good example of an area that is not served by public transportation today

that, when it is served, is much more effective two-way travel.

Chairman TOM DAVIS. Of course. That makes sense.

Ms. Norton.

Ms. NORTON. Just a couple more questions, Mr Chairman.

Let me raise a very tricky question, but I think it has to be

raised for the public record. My understanding is there has been

no fare increase for 8 years. Is that true? If that is true—this is

my question, and here I want to raise a disclaimer to my constituents: I am not here advocating a fare increase. Hear me, hear me.

Nevertheless, I wonder if we are doing anybody any favor. I remember WASA, the chairman will remember when we had to reform WASA altogether. It had a similarly long period of no fare increase, and then we were going to reform it, some of the money is

going to have to come from rate payers and, of course, then everybody screams and yells.

So the real question is, do you want to take the screaming and

yelling little by little or what is the theory behind keeping fares

unchanged for 8 years? Are you sending the message that you really don’t intend to raise fares? And isn’t it fair for the public to believe that is the message they have? If that is not the message,

what is it that you intend to do?

Mr. KAUFFMAN. Ms. Norton, if I could start, and I am sure others

may wish to weigh in. Certainly what the customer pays is a part

of covering the total cost of the ride. Only you were gracious

enough to remember that we went 8 years without a fare increase.

What most of our riders remember is the last 2 years they have

gotten fare increases. The challenge is how to find a predictable increase, frankly, that would be tied to a defendable indicator,

whether some sort of a measure, whether it is cost of living——

Ms. NORTON. Is that so hard to do?

Mr. KAUFFMAN. It is to get agreement on what that is.

Ms. NORTON. Has anybody tried on your board?

Mr. KAUFFMAN. We have tried actually on the board to do either

a 2-year budget or to tie it to a regular indicator. The challenge,

Ms. Norton, has been what this committee is talking about today:

in the absence of having a level table so we know what the total

funding pie is going to be, getting into what that fixed percentage

is on the rider is put up in the air.

What I would certainly have to acknowledge is that today there

is a great disparity on the percent of the cost of the ride borne by

our rail versus the cost of the ride borne by our bus customer.

Right now, on a regular basis, over three-quarters of the cost of

providing service to our rail customer is paid for by the customer;

whereas, somewhat less than a third is paid on the bus side. So

trying to determine what is a fair predictable increase is also at

bar.

Ms. NORTON. Well, again, I happen not to think that is rocket

science. It is interesting you say it is linked to dedicated funding

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or anything else. I do think that, again, it would help us on this

side to see some at least skull work being done by Metro on this

very troublesome issue.

Mr. KAUFFMAN. Well, it is, but let me just, again, be very frank.

My colleagues from Maryland would probably just as soon have it

all borne by the customer. So we have to strike the balances of jurisdiction.

Ms. NORTON. And I have real concern when fares apply across

the board, you know, if you are low-income or high-income, which

leads to my next question. Is there any other system which has

subsidized fares? Some of our people can actually get away with

paying, if they work for the Federal Government, virtually no fares

or at least a subsidized fare. Is that found anywhere else in the

United States?

Mr. MILLAR. Perhaps I should lead the comment on that. It is not

uncommon at all to have employer subsidy, such as has been discussed today with the Federal Government, to WMATA. They go

under various names: transit check is one very common one, and

things of that sort. So that is a pretty typical and common way

that fares are subsidized around the country.

Ms. NORTON. I am sorry, I was distracted.

Mr. MILLAR. OK. I am sorry.

Ms. NORTON. A typical way is what?

Mr. MILLAR. The subsidization of transit fares by employers is

fairly common around the country. It certainly happens more here

than other places.

Ms. NORTON. Well, it happens more here because we have the

granddaddy of all employers. What I want to know, and this is

what I would ask Ms. Schneider, is whether or not there are any

businesses in this region that have followed the leadership, the

very ample and, I must say, generous leadership, on this score, it

seems to me, the Federal Government has stepped up to the plate.

Are there any employers who have done that? Does the Board of

Trade, Chamber of Commerce, Federal City Council have any recommendation to employers along that score? Do you think they

should?

Ms. SCHNEIDER. There are significant numbers of businesses that

provide support for their employees who use public transit. I don’t

have the exact number, but we can get that number for you. But

it is comparable to what the Federal Government provides.

Mr. WHITE. Ms. Norton, in our transit benefit program that we

are speaking of right now, there is approximately 150,000 Federal

employees that are enrolled, taking advantage of that benefit that

the Federal Government provides to them. And I believe the number is around 60,000 to 70,000 members who are private sector

members who also take advantage of that benefit that is offered by

their private sector employer, be it a pre-tax benefit or the full kind

of benefit that the Federal Government offers.

Ms. NORTON. That is very, very important; it is an example of

where the Federal Government takes leadership. And, in a real

sense, private employers have to do it. You may have worked for

a Federal employer or you may work for a Federal employer, and

then the private employer wants you and you say, oh my goodness,

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creasingly, everybody understands what they have to do in order

to compete with one another.

This is a final question. I was struck, Ms. Siggerud, by your analysis of what happened when the New York City Transit Agency

tied funding to oversight. And then you outlined how the oversight

was done; it looks like it was fairly effective. And here I am referring to the part of your testimony that says, again, tied to oversight. For example, the mean distance between failures has increased from less than 7,000 miles in 1981 to nearly 140,000 miles

in 2003.

This is a system that already had dedicated funding, I take it,

at the time. So my question is whether you think it is the oversight

that matters most, given, I take it, that in 1981 New York already

had some dedicated funding. They must have been talking about

increased funding to the system.

Ms. SIGGERUD. I haven’t done the analysis to know whether the

funding or the oversight was more important, but I think that what

is important is that they go hand in hand. What the MTA oversight

felt was that if we are going to make additional revenue available

to the New York City subway and transit system, that we ought

to have some accountability. And as my statement said, there was

a capital board set up, along with, I believe, don’t quote me, but

I believe there was also an inspector general set up for that organization.

Ms. NORTON. Inspector general capital program oversight?

Ms. SIGGERUD. Right.

Ms. NORTON. And transportation capital review board? All three

were there?

Ms. SIGGERUD. Correct. All those were established, and they report variously, but mostly to the Governor of the State of New

York. And Mr. Millar also has some information on that.

But what I think is important with regard to Metro here is we

noted that there are a variety of levels and types of oversight that

occur. You have the Federal oversight that relates to compliance

with Federal law and with the use of Federal capital funds; you

have an auditor general and a variety of other organizations. I

think the key here is to ask the question whether, when you put

all of that together, we answer the sorts of questions that we can

identify the major operating and managing challenges that are facing WMATA.

And in creating an inspector general, should this legislation go

forth, it needs to be charged with really complimenting and integrating the existing oversight and reporting to the board on the

performance concepts. I believe Mr. Millar mentioned looking at

the performance of the system and understanding the components

of it are very important. The inspector general should be charged

with those sorts of high-level tasks, in addition to integrating all

of the other oversight that occurs.

Ms. NORTON. Ms. Siggerud, you, faithful to GAO’s sense of the

Federal deficit, indicated that the Federal Government would have

to make sure that whatever was done for Metro met its competing

priorities. And I just want to say for the record the breakdown of

this system 1 day is billions of dollars that the Federal Government

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could never recover, and the chairman’s job and my job is to make

people understand that.

In terms of competing priorities, you have 200,000 people. You

try putting them out of commission by what happens to Metro in

1 day, and you will figure out what your competing priorities ought

to be. I am very concerned——

Chairman TOM DAVIS. It would make Tractor Man look like

nothing.

Ms. NORTON. Tractor Man is a very good example. At least that

was when people were at work and were going home.

Finally, let me say I am very concerned. As a member of the

Homeland Security Committee, I sat in a hearing with Ms. Hanson, your chief, and learned that Metro has gotten $15 million

since September 11th for security that is dedicated funding; whereas, before September 11th, for safety it had gotten $50 million for

security.

I know you are ahead of many other systems, but I am concerned

that your blue ribbon panel costs do not include and could not include security. I am not sure how much real preventative maintenance it includes. It is one thing to step up and fund the system.

It is another thing to kind of keep that going so that you don’t fall

back and don’t have to, therefore, do it all over again.

Anyway, we are going to try, but I must say that those of you

at the table representing the business community, representing

Metro and its board and, therefore, our region, really have to step

up first. Once you step up, it seems to me it gives the chairman

and the regional delegation what it takes to move forward, put

something on the table for the Federal Government and say ‘‘your

move.’’

Thank you, Mr. Chairman.

Chairman TOM DAVIS. Thank you.

I want to thank all of you for being here. This is an important

first hearing for us. We will do more, but this is a draft. The legislation that we have put forward is kind of our opening. There will

be a lot of give and take as we move forward, and I look forward

to working with all of you as we try to perfect this, move it out of

committee and to the House floor.

The hearing is adjourned.

[Whereupon, at 12:12 p.m., the committee was adjourned.]

[The prepared statements of Hon. Henry A. Waxman, Hon. Diane

E. Watson, and Hon. Elijah E. Cummings follow:]

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