Metro News Release

For immediate release: December 14, 2006

Metro’s 2008 Proposed Budget Recommends Reduced Expenses, Rewards Use of SmarTrip Card, Raises Fares

Metro customers could be rewarded for paying with their SmarTrip card, given discounts to ride Metrorail and Metrobus during off-peak periods or asked to pay a “congestion fee” under a budget proposal submitted to the Metro Budget Committee today. The proposed budget also calls for a fare increase--the first increase in three years-- at a rate comparable to the rate of inflation.

Metro Acting General Manager Jack Requa today presented the $1.9 billion proposed Fiscal Year 2008 Operating and Capital Improvement Program budgets to the Board Budget Committee, which will review the proposals over the next six months before final approval. The FY 2008 budget will take effect July 1, 2007.

“This year’s budget takes a serious look at how we do business, and has generated significant cost reductions,” Mr. Requa said. “It includes the possibility of reduced operating hours, the elimination of positions, and a creative look at our fares. It includes a variety of different ways to collect fares such as discounted fares for people who make the reverse commute and offering reduced fares for paying with SmarTrip cards,” he said.

Proposed Fiscal Year 2008 Operating Budget

The proposed fiscal year 2008 operating budget of $1.2 billion represents a net increase of $100.1 million or 9 percent over the fiscal year 2007 operating budget. The increase is linked to inflation-driven costs, base adjustments and service expansion. Inflation increased the operating budget by $69.2 million. This included increases in employee salaries, health insurance, and electricity and fuel costs. Expanding bus and rail service increased the operating budget by $18 million. This included funds to operate the new rail cars, improvements to the paratransit program, and fully funded service improvements in fiscal year 2007 to reduce bus overcrowding and increase rail service on four major holidays. Annual base adjustments increased the operating budget by $29.2 million. This included increases in workers’ compensation, pension funding and utility rate increases.

As a result of these increases, Metro officials are giving the Board of Directors a range of options on how to cover the costs associated with the increase. The list of options includes a combination of fare increases; reduction in management costs, including administrative department cuts of 5 percent; the elimination of 34 administrative positions; a reduction in little-used bus and rail services and a proposal to increase funds for the depleted operating reserve.
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Proposed Rail and Bus Service Changes

Metro has proposed to reduce rail and bus services by $13.6 million. These proposed service changes include:
• Opening the Metrorail system at 8 a.m., on weekends, instead of 7 a.m.;
• Closing underutilized Metrorail station entrances on weekends where there are multiple entrances;
• Reducing regular service on Columbus Day, Veterans’ Day, Martin Luther King Jr. Day and President’s Day, and replacing it with holiday-level service, like it was prior to this year; and
• Eliminating up to 11 Metrobus routes with low ridership.

Proposed Fare Changes

The proposed operating budget also recommends the first increase in fares since 2004. The proposed fare change would “maximize the number of transit trips for each dollar of operating assistance, maximize the use of existing capacity, collect revenue in the most cost effective manner and maintain jurisdictional equity,” Mr. Requa said. “In the past, Metro has done an across the board fare change. This year, we are proposing a targeted approach to the changing the fare structure.”

The benefits of the targeted approach includes minimizing a fare increase to the most price sensitive customers, it minimizes any ridership losses, it lowers fares in the off-peak period, and it encourages Metrobus customers to use a SmarTrip card.

The proposed targeted fare approach includes charging a “core area charge” for Metrorail trips passing through the downtown core of the Metrorail system. This would minimize the impact of a fare increase on reverse commuters. This “congestion charge” would add up to a 35-cent fare for riding Metrorail into the downtown core during peak periods.

Under the targeted approach, the average fare increase for a Metrorail customer is about 30 cents, an average increase of about 5 cents for Metrobus customers, and an average increase of 75 cents to park at a Metrorail station. There will be no increase in MetroAccess fares.

Metro officials are also proposing to encourage the use of SmarTrip cards to make payment for trips because it costs Metro less money to process SmarTrip transactions than to process transactions with cash. Increasing fares for customers paying with SmarTrip at a lower rate than those paying with cash is another recommendation.

Additional fare proposals include the elimination of the one-day Metrobus pass, making bus-to-bus transfers available only on SmarTrip, and implementing a balanced transfer system. Non-Metrorail customers could pay a higher parking fee than Metro customers at Metro parking facilities, and the charge for short-term, metered parking would increase.

Under the proposed fiscal year 2008 operating budget, Metrorail, Metrobus and MetroAccess customers also would see several service enhancements.

Metrobus proposed enhancements include:
• Rehabilitating 100 older buses to “like-new” conditions;
• Expanding new technologies to provide better customer service and information to bus riders;
• Adding 100 new buses to the fleet by the end of fiscal year 2008;
• Implementing a new bus cleaning and sign maintenance program; and
• Enhancing passenger security by adding a video camera maintenance program.

Metrorail proposed enhancements include:
• Adding 122 new rail cars into the fleet by the summer of 2008;
• Replacing rail switches to maintain service reliability;
• Replacing 13 miles of rail track per year to maintain the system;
• Increasing equipment reliability to reduce service delays and offloads;
• Continuing customer outreach to address customer and employee concerns; and
• Providing refresher training to supervisors and train operators focused on customer service and rail efficiency.

MetroAccess proposed enhancements include:
• Instituting a new scheduling process and add vehicles to improve on-time performance;
• Realigning the eligibility process to educate and enable consumers to use transit and community transportation services to the extent their abilities allow; and
• Offering more services through partnerships, allowing Metro to shift current MetroAccess demand to more efficient transportation modes.

Capital Improvement Program

Metro’s proposed fiscal year 2008 capital budget is $734 million. Metro’s Capital Improvement Program (CIP) budget focuses on maintaining Metro’s infrastructure, trains and buses, purchasing additional hybrid-electric buses; replacing aging bus and rail support equipment; continuing track maintenance; and rehabilitating tunnels, aerial structures and communication upgrades.
Several improvements on the capital side of the Metrobus system include $48 million to purchase additional buses; constructing a new bus garage in Fairfax County, VA, and enhancing bus stops and developing intelligent transportation systems features at transit centers.

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News release issued on December 14, 2006.