MTA Directors Approve Plan for Recovery

Metropolitan Transportation Authority directors finally approved their long-debated “recovery plan” Wednesday, but the document faces almost as bumpy a journey to Sacramento and Washington as riders on the MTA’s old buses endure every day.

Although the plan is intended to reassure federal officials that America’s best-known--and perhaps most troubled--transit agency is getting control of its finances, serious financial and political troubles lie ahead.

At the top of the list is a threat by an influential congressman to oppose the MTA’s request for $100 million in federal funds for the North Hollywood subway extension.

“I’m deeply disappointed,” Rep. Esteban Torres (D-Pico Rivera), a member of the House transportation appropriations subcommittee, said after the vote. Unless the agency makes a greater effort to improve service to riders dependent on it, he said, “I will be forced to oppose its federal appropriation.”

Rep. Julian C. Dixon (D-Los Angeles), however, called the MTA action “a prudent step forward” in Los Angeles County’s efforts to secure federal transportation funding. Urging Torres to reconsider his position, Dixon noted that the less federal money Los Angeles receives, the more local money it must use to complete the North Hollywood subway extension.

Bus riders complained that the plan fails to ensure that the transit agency will deliver on court-ordered bus improvements. They vowed to protest to federal transit officials, who must approve the plan, and to the “special master” appointed by the federal judge who originally heard their lawsuit against the MTA.

In an interview from Washington, Gordon Linton, administrator of the Federal Transit Administration, called the board action “a step in the right direction,” but could not say whether the latest recovery plan would satisfy his agency.

The plan--demanded by federal officials 17 months ago--is the third one drafted by the MTA. The previous versions were rejected as financially flawed. The plan must be approved before federal officials release $61.5 million allocated for subway construction last year and consider the MTA’s request for $100 million this year.

State transportation officials also have said they want to review the plan before releasing $600 million in state funds.

In another development, Assembly Speaker Antonio Villaraigosa instructed his staff to prepare legislation to take elected officials off the MTA board and replace them with non-elected appointees “who are less inclined to have to deliver the bacon to their constituencies,” a spokesman said Wednesday.

Even as the board sought to take hold of the MTA’s unstable finances, the agency’s staff revised its estimate of new cost overruns for the Hollywood leg of the subway project to $96 million, or $16 million more than was projected just three months ago. The cost increases include $11 million in attorneys fees from the legal dispute between the MTA and its tunnel contractor, who was fired after the infamous sinkhole opened beneath Hollywood Boulevard.

The increase raises the total price tag for the 6.7-mile extension to $1.7 billion--about $290 million more than the original budget. The Hollywood extension, which is behind schedule, is expected to open next May.

Mayor Richard Riordan, the MTA board chairman, attempted to win Latino elected officials’ support for the plan--right up until the meeting. During the debate, he talked privately with county Supervisor and MTA board member Gloria Molina, who repeatedly shook her head in disapproval.

Concerns About the Plan

Molina cast the lone vote against the plan, arguing that the MTA should heed warnings by the Bus Riders Union that the plan falls short of ensuring that the agency can comply with the federal consent decree to reduce overcrowding on its buses.

Although the MTA contends that it is in compliance with the consent decree, Molina said: “I’ve been in that back room where we pound our chest about how our lawyers are going to beat up the Bus Riders Union and we lose every single time.”

County Supervisor and MTA board member Yvonne Brathwaite Burke responded, “We’re not going to have any money for [new] buses unless we come up with a plan that . . . gives the impression that we are bringing under control our financial situation.”

Afterward, Riordan said he would continue talking with Latino representatives in Washington. Torres and Riordan and their staffs conducted lengthy negotiations in recent days, but neither would disclose details. Torres said he asked the mayor to delay a vote, but Riordan said that the board needed to make a decision because Congress is preparing to act on next year’s funding.

Torres said he hopes to continue talking with Riordan, “but after today’s vote, really I’m not optimistic about achieving a compromise.”

“We have not done a good job at the MTA of taking care of transit-dependent people, especially in East L.A., Pico-Union and South Los Angeles,” Riordan said, laying blame on a “flawed strategy” that began more than a decade ago.

“I believe we can do a better job,” he added. “But it means accepting the financial realities of today.”

In an effort to address Latino concerns, MTA chief Julian Burke has promised to complete a study by October of new ways to bring better mass transit to neighborhoods whose promised rail projects have been put on hold--the Eastside, Mid-City, Pasadena and San Fernando Valley. The study will examine ways to improve bus service and to fund projects such as busways and above-ground trolley lines.

But Pasadena Mayor Chris Holden urged the MTA to find a way to complete the stalled light-rail line from downtown Los Angeles to Pasadena and “not waste taxpayers money going over technology and alignment issues that have already been resolved.”

Molina said after the meeting that she was resigned to the fact that there would be no mass transit project for the Eastside for the next six years other than bus improvements. “I think we’re just going to have to find a way that buses are going to work better for people,” she said.

Reliance on Uncertainties

Los Angeles City Councilman Richard Alatorre, an MTA board member who worked hard to extend the subway to his Eastside district, complained that the agency has conducted enough studies. Busways have previously been rejected, he said, because the streets in Boyle Heights are too narrow. He asserted that there might be ways to proceed with subway construction, perhaps by issuing bonds secured against higher-than-expected sales tax revenues brought about by an improving economy.

“A lot of people at the community level and in Washington worked very hard to get to the point where we’re at and now we’re being asked to backtrack,” said Alatorre, who abstained from voting on the recovery plan.

MTA chief Burke said the plan--renamed a “restructuring plan,” was an “important step toward restoring the MTA’s credibility with its funding partners and with the public.”

County Supervisor and MTA board member Zev Yaroslavsky added that the plan “recognizes reality for the first time . . . and gives us an opportunity to try to stabilize this place so that we can start to do the things that we all talk about wanting to do.”

Urging the board to act quickly, Riordan said: “If we don’t complete what we started, we’re going to totally lose the confidence that we’re starting to gain in Washington.”

The inch-thick plan relies on a number of political uncertainties, including the MTA board’s expected approval of a 10-cent increase in the $1.35 bus fare, as early as Nov. 1.

The document projects a nearly $700-million budget deficit over the next six years, but officials said they are working to reduce the shortfall.

“The restructuring plan is honest about the fact that the agency hasn’t fully solved its problems,” said Allan Lipsky, MTA deputy chief executive officer. “Previous plans have been criticized because the agency was too optimistic about its assumptions.”

The plan now goes to the federal General Accounting Office, the U.S. Department of Transportation inspector general and the Federal Transit Administration--all of which must find the document financially sound before the MTA receives federal funds for the subway project.

While the board met, several hundred thousand petitions were arriving at Los Angeles homes for a proposed ballot initiative that has stirred up trouble in Washington. The initiative, sponsored by Yaroslavsky, has angered Latino congressional representatives because it would bar using Los Angeles County’s transit sales tax for any subway--including one to the Eastside--except the North Hollywood extension.

Yaroslavsky said his paid signature gatherers are having “no trouble at all getting signatures. This is not one where you have to explain it.”