The TriMet Board of Directors adopted next year's budget on Wednesday morning.
For the second year in a row, the budget that takes effect on July 1 does not increase fares. It also increases service by continuing to restore cuts made during the Great Recession. And it increases funds for maintenance.
The community and our riders have asked for more service and for improvements to make our system work better for them, and we listened, TriMet General Manager Neil McFarlane said in a prepared statement. With the focus on fiscal stability and realigning our benefit costs, we will continue to set a course to provide more service to our growing region and keep our commitment to employees, retirees, riders and payroll taxpayers for the long term.
The board vote comes as TriMet and the union that represents most of its employees are still sparring over both the last and next labor contract. TriMet insists the members of Amalgamated Transit Union 757 must agree to health benefit restrictions for the future financial stability of the regional transit agency. ATU 757 says TriMet should cut management costs and stop future MAX projects instead.
The last contract was imposed by a state-approved arbitrator after negotiations broke down. The union appealed that to the state Employment Relations Board, which upheld the contract, and then the Oregon Court of Appeals, which has yet to issue a ruling. TriMet recently declared an impasse in the negotiations over the next contract, triggering the process for another arbitrator ruling.
TriMet issued the following statement on the budget vote Wednesday afternoon:
For the third time in a year, TriMet will improve transit service throughout the region as part of its Fiscal Year 2015 budget adopted today by the board of directors. The FY15 budget prioritizes improving schedule reliability and reducing overcrowding by adding more service for our riders. The service investments come in response to requests throughout the community and our customers for more and better service.
For the second year in a row, riders will not see a fare increase, but will see more new buses in service and more maintenance for the MAX system to improve reliability. The budget also allows for more investment in technology and safety/security investments.
Continued Investment in Service
The service improvements included in the FY15 budget will add more trips on 26 bus lines, touching over 270,000 transit trips per weekday. At the end of FY15, TriMet will have restored the number of overall service hours to FY10 levels. Between September 2013 and spring 2015 TriMet will have invested $12.3 million in service:
Sept. 2013: $2.1 million that improved service to 11 bus lines and added a new line between Sherwood and Tigard.
March 2014: $3.1 million that completed the restoration of Frequent Service during weekday midday hours to 10 of the 12 Frequent Service lines. Two of the lines had already had Frequent Service restored during those hours.
FY15: $7.1 million for service restoration, peak hour and reliability investments on 26 bus lines.
The budget continues to build on the work to improve the financial health of the agency and is based on an improving economy and the financial equivalent of TriMets contract proposal being accepted by the Amalgamated Transit Union (ATU). TriMet continues to negotiate over the cost structure of the union contract by bringing active and retiree medical costs in line with non-union employees as well as peer agencies and the marketplace.
The community and our riders have asked for more service and for improvements to make our system work better for them, and we listened, said TriMet General Manager Neil McFarlane. With the focus on fiscal stability and realigning our benefit costs, we will continue to set a course to provide more service to our growing region and keep our commitment to employees, retirees, riders and payroll taxpayers for the long term.
Fiscal Year 2015 budget highlights
In addition to improving service, the budget calls for more investments in the improved service reliability of our MAX system. Many of these investments dovetail with the recent Secretary of States audit.
Investing in service and reliability
TriMet will invest $3.6 million to add more trips into the evening so that all Frequent Service bus lines and all MAX lines will have 15 minute or better service later into the evening on weekdays. The 12 Frequent Service bus lines with improved evening service will be: 4, 6, 8, 9, 12, 14, 15, 33, 54/56, 57 and 75. Line 72 already has 15 minute service until 9 p.m.
MAX Green Line will have 15 minute or better service into the evening hours, matching the current service on the Blue, Red and Yellow lines.
TriMet will invest $3.4 million to improve other bus service:
More buses will be added to 11 lines to relieve overcrowding and make trips more comfortable for riders: Lines 4, 8, 9, 10, 15, 20, 33, 44, 76, 94 and 99.
TriMet will adjust schedules on three lines to give them more predictable arrival times: Line 71 will see improvements this summer with Lines 20 and 72 improvements coming later in the budget year.
TriMet is hiring new bus operators to meet growing service expansions, including the opening of the Portland-Milwaukie Light Rail Transit Project, and to provide the service improvements listed above.
Improving the MAX system
TriMet continues to invest in MAX maintenance and infrastructure to improve safety, reliability and on-time performance. This includes incorporating industry best practices, as well as implementing the Secretary of States audit recommendations related to system reliability. Some of the major State of Good Repair improvements include:
Blue Line Station Rehab: with work beginning this fall, riders will begin to see upgrades to 14 stations between 42nd/Hollywood and Cleveland, and will include lighting upgrades, improvements to access and safe crossings.
Sunset Transit Center Platform project: the Sunset Transit Center MAX platforms will be replaced with work beginning this fall.
11th and Holladay: TriMet will be replacing switches, turnouts and infill between tracks and ties.
Steel Bridge: as a partner on the Steel Bridge, we are investing nearly $500,000 in improvements over the next fiscal year. We will be meeting with bridge stakeholders to determine the specific plan for implementation to upgrade bridge components, namely to restore an allowable speed of 15 MPH across the bridge for our light rail vehicles.
Buying new buses
Riders will see 64 new buses added to the fleet in FY15. This will bring the total to 249 new buses purchased over the past four years. TriMet is preparing to put the first of 60 new buses into service in the coming weeks. These 60 were purchased in FY14. The agency will be receiving the first batch of 30 new buses that are part of the FY15 budget this fall/winter.
Weve accelerated our annual bus purchase program and are quickly moving from having one of the oldest fleets in the industry to matching the standard fleet age of eight years. Bus replacement had been suspended during the recession to focus resources on retaining as much service as possible.
Completing the Portland-Milwaukie Light Rail Transit Project
Construction of the 7.3-mile Portland-Milwaukie light rail project is on track to be completed on time and on budget.
During FY15, the project will complete safety certification and operator training in advance of the September 12, 2015 opening.
The future Orange Line will expand the MAX system to 60 miles and 97 stations.
Safety & Security Investments
We continue to make investments in the overall safety and security of our system:
Continue safety certification & annual operator training
WES Positive Train Control mandated by the Federal Railroad Administration
Replace Closed circuit television (CCTV) technology on buses and rail vehicles to improve security
Pedestrian improvements at three MAX stations with new development underway: Convention Center, NE 7th Ave and Orenco/NW 231st Ave
Investing in Technology
Real Time GPS tracking for MAX
Fare System Replacement moving to a more-efficient electronic fare system
Secretary of States Audit: Most serious and looming concerns
The recent Secretary of States audit stated the most serious and looming concerns related to the cost of health care benefits and the unfunded liability for retiree health care, also known as Other Post Employment Benefits (OPEB). A recent actuarial valuation of the OPEB healthcare liability values the liability at $950 million. TriMet is working to reform these benefits through contract negotiations so the agency will be in line with peers.
In February 2014, the TriMet board adopted pension funding plans for the two closed defined benefit pension plans. The plans accelerate funding from historic levels to bring both plans to fully funded status within 15 years. The FY15 budget is consistent with these plans.
The audit noted that TriMet had made progress in the areas of its financial condition, transparency and operations. TriMet will implement all of the recommendations by the end of 2014 that do not require agreement by the ATU. The agency will work with the ATU on the remaining items.
Through interest arbitration, TriMet is beginning to lower its employee and retiree benefit costs with the focus to align total compensation with our peer agencies and TriMets non-union employees.
Non-union employees have already had their benefits and pension reformed, and the agency is working to bring the union benefits into alignment.
After 37 bargaining sessions and two mediation sessions, but with no headway on the major economic issues, we reluctantly took the next step and declared impasse in an effort to move toward orderly contract resolution. Without reaching consensus with the ATU, the parties are now heading toward mediation.
TriMets three-year contract proposal includes 0-0-3% annual wage increase, as well as an 80/20 preferred provider health care plan and a $10 co-pay HMO plan, both with a six percent premium contribution, matching the non-union health care plan.
Keeping pace with the marketplace
TriMets non-union employees have seen their healthcare benefits reduced to keep them in line with peers and with whats available in the marketplace.
For only the second time in five and a half years, non-union employees will see small wage increases based on performance and overall compensation. The budget allows for these adjustments.
The FY15 budget takes effect on July 1, 2014 and runs through June 30, 2015.