Muni's mismanagement of Prop. A may hurt future funding tries

San Francisco voters in November of next year will likely be asked to approve about $590 million in tax increases and bond measures for transportation improvements in The City. If the initiatives have any chance of passing — no certainty with high thresholds for approval — advocates of the plans will have to convince a skeptical public that they’ve learned their lesson from the last time they asked voters for money.

In 2007, the Board of Supervisors, led by then-President Aaron Peskin, backed Proposition A, a ballot measure intended to give the San Francisco Municipal Transportation Agency more control over revenue collected from parking meters and off-street lots. The initiative was projected to generate $26 million a year and help the agency toward its long-sought goal of fiscal solvency.

On the 2007 voter pamphlet, supporters of Prop. A said, “San Francisco can have the clean, safe and reliable transit system our world-class city deserves. This Charter Amendment is the next step.”

Fast-forward to the present, and the transit agency — which manages everything from cabs to parking to bikes, along with Muni — is again struggling with a structural deficit. Where exactly the spoils of the extra revenue have gone is hotly disputed by politicians, policymakers and advocates familiar with the agency.

Tom Nolan, chairman of the transit agency board of directors, conceded that it’s difficult for riders to notice a discernible improvement from the passage of Prop. A.

“I don’t think our customers believe that the measure resulted in $26 million in improvements for Muni,” Nolan said. “We’re admittedly still struggling with some of our old issues, like on-time performance.”

Over the first four full years of its existence, Prop. A has generated $112.2 million for the transit agency, but the agency has been forced to cut service and increase fares during that time.

Transit agency spokesman Paul Rose said Prop. A has helped reduce the agency’s structural deficit, which stood at $120 million a year in transit costs alone in 2007. Now, the annual shortfall for the entire transit agency has decreased to $70 million.

The extra funds from parking meters and lots were supposed to benefit Muni’s long-gestating Transit Effectiveness Project, a comprehensive plan to speed up and increase service on San Francisco’s transit network.

Yet a narrative emerged shortly after the passage of Prop. A that former Mayor Gavin Newsom ordered the transit agency to use the extra revenue to pay for increased work orders — bills paid to other city agencies for services rendered. Many said that Newsom ignored the intent of the initiative in order to prop up city agencies struggling mightily with the brunt of the economic recession.

“There is no question that Newsom contravened the spirit of Prop. A by turning around and handing the funds to the Police Department, the Department of Public Works and other agencies,” Peskin said. “He explicitly told us that, and that’s why a huge fight erupted between him and the board. If I was on the current board, I would introduce a Prop. A reform measure to force the agency to spend the money where it’s supposed to go.”

While Rose said no Prop. A funds went toward work-order programs, those interagency payments increased significantly after the ballot initiative was passed.

In the 2006-07 fiscal year, before Prop. A was passed, the agency was spending $42.9 million annually on work orders. By 2008-09, that total had increased more than 50 percent to $66.5 million.

Between 2007 and 2009, the transit agency more than tripled its work order payments to the Mayor’s Office for youth works programs, with the bill increasing from $16,800 to $54,600, according to transit agency records obtained by The San Francisco Examiner. Also, payments for the Police Department’s Muni Response Team went from zero in 2007 to $2.5 million in 2009.

Calls and emails to representatives of Newsom, who is now the state’s lieutenant governor, were not returned.
Greg Dewar, a transit advocate who publishes the N-Judah Chronicles blog, said Prop. A simply allowed the transit agency to move money around to pay for other objectives and did little to further the cause of the Transit Effectiveness Project, which has yet to be fully implemented.

“No one can say with a straight face that this money has helped improve Muni service,” Dewar said.

While the transit agency said Prop. A has had a positive effect, it will have to convince voters of that if the agency hopes to pass other revenue-generating ballot initiatives.

The transit agency is proposing to put a $150 million general obligation bond on the 2014 ballot, with money going toward transit, bike and pedestrian improvement projects.

A second measure, to increase the vehicle license fee in San Francisco, also could go before voters. That initiative would generate $440 million over the next decade. The Department of Public Works is set to receive the majority of those funds for street repaving projects, but the transit agency would still get $100 million for safety and infrastructure projects.

The bond would require a two-thirds majority from voters. The vehicle license fee would need approval from The City’s Board of Supervisors to make the ballot, where it would then a need a simple majority from voters to pass.
Dewar said the transit agency has squandered the opportunity to build good will among voters, particularly with its failure to show how Prop. A improved Muni.

“You could tell everyone that these new ballot initiatives would make Muni the best system in the world and I still think it would have trouble passing,” Dewar said.

Nolan said the transit agency needs to use the next 18 months to convince voters that it can be trusted to properly use taxpayer dollars.

“With these new ballot measures, we need to make it very clear about what they’re going to pay for and how they’re going to improve the system,” Nolan said. “Everything needs to be ironclad this time.”

Coming Monday

When San Francisco voters passed Proposition A in 2007, it was intended to give The City’s transit agency more control over revenue from parking meters and off-street lots. Years later, that money has been put toward other uses, including paying work orders for services from other city departments. Find out where some of those funds have gone in Monday’s San Francisco Examiner.

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