Cascade in the Capitol: Testimony in Support of the Oregon Department of State Lands’ Proposal for the Elliott State Forest

The Oregon Department of State Lands (DSL) is proposing that the Oregon State Land Board―comprised of the Governor, the Secretary of State, and the Oregon Treasurer―sell off 2,700 acres of the Elliott State Forest. The Elliott is a 93,000-acre state forest located on the southern Oregon coast. Most of the forest is required by state law to be managed to generate revenue for the Common School Fund, an endowment for public schools. Due to environmental litigation, timber harvesting has plummeted on the Elliott, making it impossible to fulfill the mission of providing income for the Common School Fund. Therefore, the DSL is proposing to sell three small tracts in order to generate funds.

Cascade President and CEO John A. Charles, Jr. submitted testimony earlier this week in support of the sale:

“I am writing in support of the proposed sale of three parcels within the Elliott State Forest―the Adams Ridge, Benson Ridge, and East Hakki Ridge Tracts. Sale of these parcels is consistent with the Constitutional and statutory directives to the Land Board that it maximize revenue over the long term from Common School Trust Lands.

“Clearly the annual returns on the Common School Fund over the past 20 years have been far superior to the returns from timber harvesting on the ESF, as noted in the Department’s Real Estate Asset Management Plan. Given that the returns on timber harvesting have been declining and will likely decline even more in the near future due to environmental litigation, public schools that rely on the twice-annual distributions from the CSF would be better served with the sale of timberland from the ESF, with the proceeds placed under the management of the Oregon Investment Council.”

Cascade has long supported the lease or sale of Common School Trust Lands, and welcomes the move by the SLB to sell off small parts of the Elliott State Forest. The Land Board will consider the matter at its upcoming meeting in Salem on December 10.

Cascade in the Capitol: Testimony Regarding Grand Bargain Small Business Tax Cuts

Steve Buckstein presented the following testimony to the Joint Interim Committee on Special Session prior to the September 30th special session. The audio of the hearing is here. Steve’s testimony begins at 1:09:22. He was the first member of the public to testify on Legislative Concept 3, the revenue raising part of the so-called Special Session Grand Bargain. Each person was limited to two minutes of oral testimony:

Testimony Before the Joint Interim Committee
on Special Session in Favor of
Small Business Tax Cuts
by Steve Buckstein

Good morning, Co-chairs Courtney and Kotek and members of the Committee. My name is Steve Buckstein. I’m Senior Policy Analyst and founder of Cascade Policy Institute, which is a non-profit, non-partisan think tank based in Portland. Cascade’s mission is to develop and promote public policy alternatives that foster individual liberty, personal responsibility, and economic opportunity.

While I do not support the revenue raising portions of this legislation, reducing tax rates on small businesses is a very positive step that I urge you to take.
There was an instructive exchange on this topic on June 20th before the Senate Finance and Revenue Committee.* One tax cut opponent noted that he didn’t believe the person who fixes his washing machine was going to buy another truck and get another employee for his small business because of a reduction in his tax rate.

I then told the committee that while this one repair man may not change his economic behavior, a tax cut just might be the deciding factor for some entrepreneur to locate a new washing machine manufacturing plant here, hiring dozens or hundreds of Oregonians.

We need to understand that in this modern world, people and capital are mobile. Investors and businesspeople change their behavior based on the incentives and disincentives they face. Oregon’s high tax rates shine like a big STOP sign at every border, warning high-income people and many businesses that the cost of staying here or coming here may be too high compared to other states.

So, rather than rely on taxing others more to generate revenue, rely on the fact that lowering small business tax rates will make Oregon more business friendly, thus generating jobs and more tax revenue.

I have it on good authority that each of you would like to take credit for creating more jobs in this state. Here’s your chance.

Thank you.

* June 20th Hearing audio. The tax cut opponent’s repair man story begins at 1:25:40. My full testimony begins at 1:45:37 and my repair man story rebuttal starts at 1:47:40.

Testimony in Opposition to the Oregon Convention Center Headquarters Hotel deal

On August 15, 2013 the Metro Council unanimously approved two resolutions that move the discussion forward toward subsidizing a Headquarters Hotel near the Oregon Convention Center in Portland.

Metro’s news article about the meeting (which quotes from Steve Buckstein’s testimony below) is here. Read his testimony below:

For the record my name is Steve Buckstein. I’m Senior Policy Analyst and founder of Cascade Policy Institute, a free-market think tank here in Portland.

Originally, the idea behind the Oregon Convention Center was that if we put together the right package of amenities, then everyone would come to Portland and spend lots of money eating and shopping when they weren’t attending meetings.

That same idea occurred to people in other cities, and it sparked an ambitious municipal competition that began back in the 1980s and is still going strong.

First, we built a new convention center to attract the convention business. When the original center didn’t generate the revenue we’d hoped for, we decided to expand it. When occupancy rates dropped after the expansion, we turned our attention to the need for a headquarters hotel. That was the magic ingredient we were missing.

Of course, no one wanted to listen to the critics like Professor Heywood Sanders who came here in 2005 to tell us that other cities had already tried what we wanted to try in 2007, and it didn’t work. Big convention center hotels were built in other cities with disappointing results. Not only didn’t they significantly increase convention business, but they didn’t make their occupancy projections either, and now those cities are saddled with money-losing convention centers and money-losing hotels. The fact that the private sector wouldn’t put up much of its own money for such facilities somehow didn’t matter in other cities.

The question you have to answer now is: Does it matter to us?

We like to tell ourselves that Portland is different, but are you willing to risk your taxpayers’ money on that difference, knowing that the competition for convention business is only getting more intense?

As you may remember, in 2007 The Portland Development Commission (PDC) rejected the only Convention Center hotel proposal that didn’t require government subsidies.

The Grand Ronde Indian Tribe said it could do the project with all private money if it were allowed to include a gambling casino. After they were turned down, a tribe spokesman said, “We refuse to raid taxpayer dollars for any project.” He could have added, “especially for hotels which are not core functions of government.”

Rather than deciding today if you want to double down by subsidizing a headquarters hotel, I suggest you do the politically incorrect thing and consider whether you really want to be in the convention center business at all. If the answer to that question is No, which I believe it should be, then consider selling the Convention Center and cut your losses.

[Metro Council] President Hughes, you have correctly pointed out that if you look for a project that’s been scrubbed of all the risk, you will never do anything.

But I hope you will also consider the advice of management guru Peter Drucker who warned:

“There is nothing so useless as doing efficiently that which should not be done at all.”

The core functions of government are to protect our lives, liberty, and property. Providing our entertainment and convention venues should not be done by government at all.

Ironically, in October the Convention Center will host another Scam Jam event where the state attorney general and others will help Oregonians avoid being ripped off by financial con artists. I wouldn’t be surprised if some day in the future publicly funded convention centers and headquarters hotels are listed along with stock swindles as financial transactions to be avoided at all costs by the public.

Further information

The Unseen Costs of Ribbon Cutting: Losses from Economic Development Programs, William B. Conerly, Ph.D., Cascade Policy Institute, June 1998.

Testimony on Beaverton Economic Development Project Grant

Cascade President and CEO John A. Charles, Jr. testified regarding a proposed economic development grant in Beaverton before the Oregon Transportation Commission.

Testimony of John A. Charles, Jr.

President & CEO

Before the Oregon Transportation Commission

June 19, 2013

My name is John Charles and I am President of Cascade Policy Institute. Cascade is a non-partisan policy research center, working to promote economic opportunity, individual liberty, and personal responsibility.

I have analyzed the staff report for Agenda item C1, along with related documents provided by Metro and the City of Beaverton. I have also visited the .8 mile stretch of HW 8 that is being considered for a retrofit, and walked the area on both sides of the highway. In addition, I have conducted extensive field research since 1996 on the nearby Beaverton Round light rail station.

I urge the Commission to reject the IOF grant request, for the following reasons:

 

This is not an economic development project. The primary objective of project advocates is to lower the design speed on HW 8 from 45 MPH to 30 MPH. There is no evidence that such action would incentivize additional capital investment in the region. Indeed, the sad experience of the nearby Beaverton Round district suggests that just the opposite will occur. Deliberately slowing traffic and encouraging more density in the region will make it less attractive.

The series of photos below are instructive on this point. Notwithstanding the seductive architectural rendering that advertised the future project back in 1996 – in which many pedestrians were envisioned relaxing near light rail and no parking was necessary – the reality proved to be quite different. The project went bankrupt twice. Retailers have struggled. And oddly enough, the site is covered with parking, including surface lots, gated private parking, and the tallest single building in Beaverton – a parking garage.

Unfortunately, local planners have learned nothing from the experience. On two different occasions, Metro appropriated $2 million of public money to Beaverton so that the adjacent Westgate theatre could be purchased and bulldozed. The apparent goal was to build more “transit-oriented development” that would improve the neighborhood. The site is still vacant after nearly a decade.

 

The proposed “tie-ins” of the HW 8 project to a low-stress bike route are a waste of money because sensible cyclists are already riding on nearby parallel streets. One of the selling points of the Beaverton proposal is that “traffic calming” on HW 8 will make it easier for cyclists. But low-stress cycling options already exist, as shown below.

 

Attempting to turn a state highway into a boutique “Downtown Main Street” is a nostalgic trip to the past that has no relevance. Metro has encouraged most local governments to subsidize downtown investments based on a “Main Street” model. Tigard has done this, but not by trying to re-invent nearby HW 99w; the city has simply created a faux-downtown that benefits a few businesses while being largely ignored by most Tigard residents.

 

There is no need for a new traffic light at the Rose Biggi/HW 8 intersection. The proposed Canyon Road retrofit project would add another traffic light at Rose Biggi Drive, even though there are already 5 traffic lights on HW 8 in the .8 miles of project territory. The fact that the Beaverton City Council is moving the entire City Hall staff to the Round is no reason to add another light; there are already two traffic lights serving the Round, on either side of Biggi Drive.

 

Conclusion: Stripping away the political window dressing, the real point of this project is to degrade the state highway system by reducing the design speed from 45 MPH to 30 MPH on HW 8. The OTC should resist this effort. Local planners have been waging a political campaign against auto-mobility for over 25 years, on such routes as HW 43, HW 97, and HW 26. Planners and the cycling/pedestrian/transit advocacy groups will never be satisfied, and will be emboldened to ask for even more if you keep giving away the mobility functions of the state highway system.

 

Click here to see the full testimony with photos.

Cascade in the Capitol: Tax Reform Testimony Presented to the Senate Finance Committee

Senior Policy Analyst Steve Buckstein testified on Thursday before the Senate Committee on Finance and Revenue about a series of tax reform proposals. Below is his testimony to the panel of legislators.

Testimony before the Senate Committee
on Finance and Revenue
regarding Tax Bill HB 2456
by Steve Buckstein

Good afternoon, Chair Burdick, Vice-Chair George, and members of the Committee. My name is Steve Buckstein. I’m Senior Policy Analyst and founder of Cascade Policy Institute, which is a non-profit, non-partisan think tank based in Portland. Cascade’s mission is to develop and promote public policy alternatives that foster individual liberty, personal responsibility, and economic opportunity.

I’m here to express my support for amending HB 2456 to include a new, lower income tax rate for most small businesses in the state. Small businesses, including start-ups and individual entrepreneurs, are a significant source of job creation. I have it on good authority that all state legislators would like to take credit for creating more jobs in this state. Here’s your chance.

I cannot support other changes in the bill which would jack up tax rates on C corporations and in effect raise taxes on high-income individuals. Such provisions will simply reinforce Oregon’s reputation as business-unfriendly.

In this modern world, people and capital are mobile. Investors and businesspeople change their behavior based on the incentives and disincentives they face. Oregon’s high tax rates shine like a big STOP sign at the border, warning high-income people and most businesses that the cost of coming here may be too high compared to other states.

So, by all means lower tax rates where you can, especially for small businesses. And rather than rely on taxing others more to generate revenue, rely on the fact that making Oregon more business friendly will in itself generate revenue–and jobs.

Thank you.

Open Letter to Federal Transit Administration Regarding TriMet

 On June 14th, John Charles sent this letter to the Federal Transit Administration regarding TriMet and C-TRAN proposals for the CRC light rail project.

June 14, 2013

 

Richard F. Krochalis

Regional Administrator, FTA

Jackson Federal Building
915 Second Avenue, Suite 3142
Seattle, WA 98174

            Re: FTA requirements for operating funds on New Starts projects

Dear Mr. Krochalis,

I was in the audience on May 15th when you discussed the CRC light rail proposal with the C-TRAN board. I heard you say repeatedly that the application for a FFGA could not proceed until C-TRAN had a firm commitment of adequate funding to operate the new train line.

However, those statements are at variance with how FTA is handling the same issue for federally funded LRT projects in Portland. As I outlined to you in a detailed letter two years ago, TriMet has been in violation of its FFGA for the Green Line since the day it opened, and FTA has done nothing about it.

Service hours for the Green Line were reduced by 33% before it ever opened in September 2009.[1] Service has continued to decline since then. Weekly revenue hours have dropped from 692.4 in the opening year to 686.3 in the fall of 2012, a loss of 1%.[2]

TriMet is also in violation of its FFGA for the Yellow MAX line. That line opened in 2004 with 605.4 weekly revenue service hours. By the fall of 2012, service had dropped to 568.4 weekly revenue hours, a loss of 6%.[3]

Peak-hour service on the Yellow Line was supposed to operate at headways of 10 minutes in the opening year, improving to 7.5 minutes by 2020[4]. Instead, peak-hour headways are currently 15 minutes.[5]

As I pointed out to you in 2011, TriMet has a dedicated revenue source that was supposed to be used to fulfill the obligations of the respective FFGAs. That source, the regional payroll tax, was enhanced by the state legislature in both 2003 and 2009, allowing TriMet to raise the tax rate. The first tax increase was implemented effective January 2005, and has raised a cumulative total of $122.6 million in new revenue through FY 13.[6]

The combined net operating costs of the Green and Yellow lines in 2011 were $10.2 million.[7] Clearly the new revenues generated by the payroll tax rate increase were adequate to pay for all promised new service on the two new MAX lines, if such service had been a priority for TriMet – which it isn’t.

Not only has TriMet failed to provide promised service on federally-funded light rail lines, the agency’s  total fixed route service has dropped by 14% since 2005 — despite the fact that the agency’s all-funds budget has gone up by 125% over that same period, as displayed below:

TriMet Financial Resources, 2004-2013 (000s) 

 

FY 04/05

FY 08/09

FY 10/11

FY 11/12 (est)

FY 12/13 (budget)

% Change 04/05-12/13

Passenger fares

$  59,487

$  90,016

$  96,889

$  104,032

$117,166

+97%

Payroll tax revenue

$171,227

$209,089

$224,858

$232,832

244,457

+43%

Total operating resources

$308,766

397,240

$399,641

$476,364

$465,056

+51%

Total Resources

$493,722

$888,346

$920,044

$971,613

$1,111,384

+125%

 

Annual Fixed Route Service Trends, 2004-2012 

FY 04

FY 06

FY 08

FY 10

FY 12

Change

Veh. revenue hours

1,698,492

1,653,180

1,712,724

1,682,180

1,561,242

-8.1%

Veh. revenue miles

27,548,927

26,830,124

26,448,873

25,781,480

23,625,960

-14.2

In its most recent long-term financial forecast, TriMet admits that the agency’s current service problems are “not caused by TriMet’s revenue base.” According to the agency, TriMet’s operating revenues per capita “are 70% higher than its peer comparators.”[8]

Nonetheless, TriMet service is in a death spiral.

TriMet General Manager told his board in February that the forecast for TriMet service shows that by 2030, the agency will have a “revenue-expenditure imbalance” of some $200 million. Therefore, TriMet clearly does not expect to meet its light rail service obligations to FTA at any time during the life of the two relevant FFGAs.

In your response to me on June 20, 2011, you noted that many transit agencies experience temporary service declines due to various economic factors. Such conditions were “not typically viewed by FTA as a breach of contract.”  You pointed out that Section 19(a) of the FTA FFGA discusses “default” in terms of “…substantial failure of the Grantee to complete the Project in accordance with the Application” for federal funding.

It is clear that TriMet has failed and will continue to fail to meet its contractual obligations to operate federally-financed light rail lines as promised.

Given these facts, I can only conclude that either you misinformed the C-TRAN board about the importance of local operating revenues, or you will soon be requiring TriMet to begin fulfilling its FFGAs for the Green and Yellow lines. Which of these things is true?

Please advise at your earliest convenience.

Sincerely,

 

John A. Charles, Jr.

President & CEO

 

CC:       C-TRAN Board of Directors

TriMet Board of Directors

Interested parties



[1] TriMet, Fall 2010 Financial Forecast, p. 39.

[2] TriMet finance office, personal communication with the author, September 18, 2012.

[3] Ibid

[4] TriMet, Before and After Study, Yellow MAX Line, 2009, p. 2-2.

[5] TriMet website as of June 14, 2013, http://www.trimet.org/schedules/w/t1190_1.htm.

 

[6] TriMet, CRC August 2011 New Starts Submittal, Table 1.

[7] TriMet, FY11 Operating Statistics

[8] TriMet, Long Term Fiscal Sustainability Plan, December 2012, p. 7.

Cascade in the Capitol: Testimony Against Local Tobacco Tax Proposal

John A. Charles, Jr. submitted testimony on Monday to the Senate Committee on Finance and Revenue, speaking against a proposal to allow counties to impose local tobacco taxes.


Testimony of John A. Charles, Jr.

President & CEO 

Before the Senate Committee on Finance and Revenue

Regarding HB 2870-A

April 29, 2012 

 

I am writing in opposition to HB 2870-A.

This bill suffers from an inherent contradiction in its twin policy objectives: raising money and reducing tobacco consumption. For one to succeed, the other must fail.

None of the proponents want to admit this. They prefer to claim that the primary goal is “public health.” However,  the bill only requires that a minimum of 40% of the proceeds be spent on tobacco use prevention and cessation programs, which means that 60% of the funds will go for other uses. This clearly shows that public health is not the primary motivation behind the bill, revenue generation is.

If we admit that this is just a money bill, then there is no compelling argument in favor of taxing a product used by only a fifth of the population, in order to create a revenue stream that will likely benefit everyone. The only reason such bills get introduced is because it is politically easy to pick on a minority group engaged in a habit that is publicly scorned.  But we should not tax minorities just because we can.

If local governments genuinely want to spend more money on tobacco cessation programs, they already have access to the MSA settlement funds. Oregon has received over $1 billion in MSA money since 1998, but virtually none of it has gone to directly help smokers. Since that was one of the express purposes of creating the fund, I’d suggest local governments direct their lobbying efforts at state legislators who continue to use revenue from the MSA as an all-purpose slush fund.

Between state and federal tobacco taxes, plus the price hikes needed by the major tobacco companies to make the MSA payments, tobacco users have paid more than their fair share for any so-called “negative social externalities” associated with smoking. Please leave them alone by tabling HB 2870.

Cascade in the Capitol: Testimony in favor of a School Choice Tax Credit

Testimony before the Senate Committee on
Education and Workforce Development
in Favor of SB 500 and SJR 23

Good afternoon, Chair Hass and members of the Committee. My name is Steve Buckstein. I’m Senior Policy Analyst and founder of Cascade Policy Institute, a non-profit, non-partisan public policy research center based in Portland.

I support SB 500 and SJR 23 for several reasons.

First, in 1922 Oregon voters approved a Ku Klux Klan supported measure that would have outlawed all private and religious schools. It was a blatantly anti-Catholic effort. The measure never took effect because the U.S. Supreme Court struck it down in 1925, and uttered these famous words:

“The child is not the mere creature of the state; those who nurture him and direct his destiny have the right, coupled with the high duty, to recognize and prepare him for additional obligations.”

In 2009, a survey of 1,200 likely Oregon voters asked a series of questions about K-12 education and school choice. 83 percent of those polled had children in school. The key finding was that while 91 percent of Oregon families sent their children to a regular public school – only thirteen percent would do so if the choice where fully theirs. The rest, 87 percent, would choose private, charter or online schools, or educate their children at home.

Please don’t be fooled by the small percentage of parents who actually exercise school choice today.

Why would 91 percent of children be in regular public schools if only 13 percent of their parents want them there? Because most people can’t afford to pay taxes for public schools and tuition for private schools at the same time.  Even though more than $5 billion tax dollars a year go toward educating Oregon’s school-age children, virtually all of that money goes to public school districts, not parents or students. Send your children where the state wants you to send them and their education is “free.”  Make another choice, and you foot the bill yourself.  The tax money stays in the public system, even if your child is being educated somewhere else.

So, ask yourselves, are we spending those $5 billion a year to support brick school buildings and the adults who work in them, or are we spending that money to educate children, wherever they can learn best?

Allowing a $1,000 tax credit is a small, but significant step you can take now to help parents exercise what the Supreme Court said was their right, and high duty — to prepare their children for additional obligations.

Oregonians clearly want to be able to choose where their children go to school. It’s about time that our lawmakers give them that choice by letting the money follow the child.

I urge you to support both SB 500 and SJR 23.

Thank you.

Cascade in the Capitol: Testimony in Opposition to More Subsidies of Student Higher Education Costs

State Treasurer Ted Wheeler has proposed that the state obligate its citizens to repay hundreds of millions of dollars in General Obligation bonds to subsidize student higher education costs. Below is the prepared testimony that I gave to a House committee last week and will give to a Senate committee tomorrow, setting out my objections to the plan:

I oppose HJR 6SB 11 and SJR 1 for several reasons.

First, as Professor Richard Vedder, author of the book “Going Broke By Degree: Why College Costs Too Much,” says, higher education prices are rising rapidly because of the predominant role of third-party payments, including federal and state support for institutions and students. “When some else is paying a lot of the bills, students are less sensitive to the price, thus allowing the colleges to care less about keeping prices under control.”

So, rather than help keep college costs and student debt levels down, Treasurer Wheeler’s proposal will likely do just the opposite.

That would be bad enough, but it will be worse because even if the investment assumptions for his proposal work out, taxpayers will be on the hook to repay hundreds of millions of dollars of bond principal, plus interest decades into the future.

Worse yet, there is evidence that more government funding of higher education actually translates to slower state economic growth. That’s likely because individuals know their needs better than politicians do, so leaving the money in private hands produces better economic results.

Further, academics such as Charles Murray and Carl Bankstron join Dr. Vedder in arguing that four-year degrees aren’t what they used to be, and that state funding may simply waste precious financial and human resources.

All that said, if increasing the percentage of Oregonians who earn two- and four-year degrees is a good goal, you should step back and look at efforts in other states to significantly reduce the cost of those degrees. Arthur Brooks recently noted in the New York Times that one idea gaining traction is the $10,000 college degree, which public universities in several states are moving toward right now. That’s $10,000 total direct costs for four years. According to Brooks, this “is exactly the kind of innovation we would expect in an industry that is showing every indication of a bubble that is about to burst.”

In conclusion, whatever the value of a college degree to an individual, it’s becoming clear that state funding of those degrees is likely to cost taxpayers more than they gain. I urge you to reject HJR 6, SB 11 and SJR 1.

Thank you.

Cascade in the Capitol: Light Rail to Vancouver vs. CTRAN Express Buses – Testimony on HB 2800

Cascade President John Charles testified today before the Joint Committee on Interstate-5 Bridge Replacement Project regarding HB 2800. His testimony follows.

The CRC Plan for Light Rail:

A Step Backwards for Transit Customers

 John A. Charles, Jr.

Cascade Policy Institute

February 2013

Metric

TriMet Yellow MAX Line to North Portland

CTRAN Express Buses Serving Downtown Portland

Capital cost of expanding  light rail to Vancouver

$932 million

$0

2011 annual operating cost

$10.2 million

$5.04 million

Operating cost/hour

$270

$110

Annual hours of service

40,492

45,996

Farebox recovery ratio for operations cost

47%

67%

Cost/new vehicle

$4,200,000

$458,333

Peak-hour frequency

Every 15 minutes

Every 10.3-15.5 minutes

Peak-hour travel speed

15 MPH

31-45 MPH

Travel time, Vancouver to Portland

36-38 minutes

16 -18 minutes

% of passenger seating capacity actually used at the peak period

34%

38%

Promises of Frequent Transit Services: Hope Over Experience

According to the most recent finance plan for this project, “Light rail in the new guideway and in the existing Yellow line alignment would be planned to operate with 7.5 minute headways during the “peak of the peak” and with 15-minute headways at all other times. This compares to 12-minute headways in “peak of the peak” and 15-minute headways at all other times for the existing Yellow line.”[1]

In fact, the Yellow Line runs at 15 minute headways all day, with even less service at night.  Yet according to the FTA Full Funding Grant Agreement for the Yellow Line, service is supposed to be operating at 10-minute headways at the peak, improving to 7.5 minute headways by 2020. TriMet is violating its FFGA contract, which could lead to a denial of funding for the $850 million grant request that the CRC project plans to make.

The Green MAX line is also operating at service levels of at least 33% below those promised in the FFGA. 

The legislature should not be expanding TriMet’s territory at this time – especially into another state that already has a transit district – because TriMet cannot afford to operate the system it already has. Despite a steady influx of general fund dollars, TriMet has been cutting service ever since the legislature approved a payroll tax rate increase in 2003, as shown below.

TriMet Financial Resources, 2004-2013 (000s)

 

FY 04/05

FY 08/09

FY 10/11

FY 11/12 (est)

FY 12/13 (budget)

% Change 04/05-12/13

Passenger fares

$   59,487

$   90,016

$   96,889

$   104,032

$117,166

+97%

Payroll tax revenue

$171,227

$209,089

$224,858

$232,832

244,457

+43%

Total operating resources

$308,766

397,240

$399,641

$476,364

$465,056

+51%

Total Resources

$493,722

$888,346

$920,044

$971,613

$1,111,384

+125%

Note: Pursuant to legislation adopted in 2003, the TriMet payroll tax rate was increased on January 1, 2005, will rise by .0001% annually until it reaches a rate of .007218% on January 1, 2014.

 

  Annual Fixed Route Service Trends, 2004-2012

FY 04

FY 06

FY 08

FY 10

FY 12

% Change

Veh. revenue hours

1,698,492

1,653,180

1,712,724

1,682,180

1,561,242

-8.1%

Vehicle revenue miles

27,548,927

26,830,124

26,448,873

25,781,480

23,625,960

-14.2

Average veh. speed – bus

15.8

15.8

14.9

14.7

14.6

-7.6%

Average veh. speed – L. Rail

20.1

19.4

19.3

19.4

18.4

-11.5%

Source: TriMet annual service and ridership report; TriMet budget documents and audited financial statements, various years.



[1] C-TRAN, High Capacity Transit System and Finance Plan, July 20, 2012, p. 4.

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