A Reminder about ATC and Capital Metro

by Cordie Ray
4/15/2004

As UT Shuttle Bus Service plods towards an imminent strike, let's remind concerned readers the aggressive union-busting tactics of multi-national English conglomerate National Express Group (parent company of ATC/Vancom - the UT service provider) are courtesy of Capital Metro.

Metro uneccessarily utilized privatization and outsourcing in providing UT service. Metro contracted with ATC even after being made aware of their poor labor practices, including opinions by the US Department of Labor that ATC violates federal law in their pay policy to drivers. The Metro Board extended the ATC contract two years in a little-used procedure that guarantees ATC bigger profits. Now, months after, Metro hides in the background attempting to distance themselves from the conflict they knew would be forthcoming, using the half-truth that they're not involved. So far the Metro board has been served at their monthly meeting with a UT Student Government Resolution supporting the shuttle workers and expressing concern over ATC. They've received a petition with over 1800 names on it supporting the shuttle workers. They've been informed of a Daily Texan online readers poll showing over 55% of respondents favor more university involvement in contract talks between workers and ATC, and they've been reminded by everyone from UT law students to labor activists that they can run, but can't hide, from their chosen employment of ATC as a contractor. UT's Daily Texan has run a myriad of articles focusing on the looming crisis, yet Metro response has been so disinterested that if they announced they'd good news to share with those concerned, it's sure they'd next explain how they just saved a bunch of money on their car insurance.

Well, even if uninvolved, Metro's certainly responsible. Their responsibility is made repugnant by the irrefutable fact that if they'd had acted more ethically none of this would be happening. Simply put, Metro could, and can, easily afford to provide the service through their own wholly owned subcontractor (Startran) and/or could have chosen a different subcontractor with a deservedly better reputation for safety and labor relations and STILL have saved a bunch of money. But they greedily raced to get the lowest cost provider, then act surprised when ATC displays the pedigree that proves their so low. Worst part is, then (when they were choosing a subcontractor) and now, it's been so unnecessary, because Metro has an embarrassment of riches. It's also unnecessary because Metro's contract with ATC gives Metro the right to sever ties with ATC at Metro's "convenience" - anytime Metro chooses - with no penalty - they (Metro) just don't (or want to) talk about that option. Want proof that Metro acts with unseemly opportunism?

It takes about 115 million to operate Metro for one year. It costs less than 8 million to operate the shuttle portion for one year. Yet the shuttle accounts for somewhere between 25-35% of all Metro riders. Metro could spend considerably more on the shuttle and it would still be several times more cost effective than the rest of their operations. Viewed another way the inequity is even more pronounced. Of the 115 million Metro needs to operate, Metro itself only generates around 30 million (which includes about 5 million from UT students) But the 1 cent city tax that goes to Metro is about 115 million, so Metro is light years away from needing to employ a marginal privatized service provider due to economic necessity. Metro has a huge surplus of cash, this year and every year (one of the benefits to taxing one of the fastest growing cities in America in the last 12 years). Metro makes a policy of stashing 25% of all the tax revenue they take in! They call this nearly 167 million dollar cookie jar their reserve or "Regional Mobility Fund". Meanwhile Metro subcontracts with ATC, a company with a checkered past here and elsewhere. repeatedly cutting health care benefits, refusing to hire drivers under 25 yrs old (even as UT students are their ultimate customers and historically a major contingent of the driving force with all previous service providers) the list goes on ad nauseum. While it's very tempting to focus on the plethora of shortcomings of ATC, the real shortcomings belong to Metro.

Unsuccessfully pitching light rail a couple of years ago, Metro executive Sam Archer was quoted (when justifying the large expected cost of the system) saying, "You always get what you pay for" . Mr. Archer is now Project Manager Metro's Saltillo Development, which sounds (not without reason) more like a real estate venture than a mass transit project, in any event he stands ready to undoubtedly use his cliche again and again in his new Metro position. But no one at Metro will concede the same wisdom when discussing ATC. Metro wants to convince everyone they've found diamonds for the price of glass. The only increased expenditure Metro seems interested in is spending more on public relations (they just made it a "department" in last year's budget, and pay it's new director about as much as what they recently payed Karen Rae to run ALL of Metro) in order to convince people to believe them instead of their own lyin' eyes- when it comes to ATC, the Saltillo District, the upcoming light (or commuter) rail II, and so much more. But let's look at just some of the Metro numbers regarding UT, gleamed from their own budgets.

Of the 30 million Metro generates on it's own, the 5.2 million dollar chunk that UT provides through student fees exceeds (by about 40%) all other fares Metro collects from all other routes for the whole year. But Metro continually complains that they are "subsidizing" UT because the service costs about 8 million and UT pays 5.2 million, so Metro supposedly picks up the tab by "subsidizing" UT 35%. But wait, Metro needs 115 million per year to operate and Metro only generates 30 million of that themselves, so Metro is "subsidized" by taxpayers about 74% ! These ratios yield several truths: 1). Proportionally UT riders pay a much bigger (more than double) share of the cost of their service, which makes it particularly unethical that Metro would strive to use the cheapest of the cheap when it comes to service providers. 2). UT is doing a poor job of insuring quality service or reasonable price when negotiating with Metro. 3). Current talk of reduced service in the name of efficiency is a farce when compared to the ridership ratios and costs the general Metro Routes operate under. Let's look closer at the above number 1.

For Capital Metro, UT riders are the gift that keeps on giving, in that the 50.000 of UT (in addition to their mandatory student fees going to Metro) pay, day in and day out, plenty of sales tax themselves, and every dollar spent is another penny for Metro. Additionally, federal laws allow Metro to benefit through capitalization deductions that pay for the cost of busses and real estate for bus facilities, substantially reducing what UT service "costs" Metro, but since these benefits are not paid to Metro on behalf of UT they're not used to offset the 8 million "cost" figure. Further, Metro runs about 400 busses and the UT fleet hovers around 90. So less than 25% of Metro's fleet is responsible for bringing in nearly 2/3 of all their fare revenue. UT is a subsidized drain on Metro the way the IRS is a subsidized drain on the federal government.

Why does Metro twist the truths about their relationship with UT so much?

Well, it deserves mentioning at this point the reasons are somewhat speculative and not the cold, hard, documentable facts that everything up to this point are. But several reasons seem probable. The short answer is that Metro acts this way because they can. No one has stopped them or even seriously questioned them on these issues. Metro knows UT is a captive audience that must have their service, so in an odd juxtaposition of allegiances they manipulate their best customers because they know they're still going to get their business. Why should Metro spend "extra money" (meaning anything above the cheapest service available) on a subcontractor for UT when every dollar that they don't spend on UT is another dollar they can spend elsewhere on their "real" service system, a system that suffers from a perpetual identity and credibility crisis (always promising the next big thing- from whiz bang bus systems to light or commuter rail) and is eternally promising to prove their worth to the larger metropolitan area in either just a little while, or a 100 million or so, more). Those toys and schemes are always expensive, but one way to have their largesse and keep the cookie jar full too is to continually shortchange the UT Shuttle. Study the Metro Budget, it's undeniable(Proposed FY 2004 Budget) Additionally, there is an awareness on the part of the Metro board (which includes city politicians) that since the cent Metro gets from the sales tax represents 50% of all the revenue the city is allowed to take from its citizens in sales tax (by state law) any money spent on UT is like giving your rich uncle a gift. Never mind that the rich uncle is really a bunch of cash-strapped federal-loan-borrowing kids. And what about UT Transportation, why are they willing to sign on to deals that keep them paying more but getting less (up from 4.1 million in 1998 to 5.2 million this year) even when they must know that given Metro's resources it doesn't have to be that way? Let's examine number 2 and 3 from the above.

Again the reasons are speculative, and since UT doesn't enjoy the questions, much less providing answers, consider the following logical speculation. In a study of Capital Metro done by the Public Policy Forum (a non-profit group with a web site- TPPF Report on Cap Metro) the history of how UT came to buy bus service for students in the first place begins by stating the purchase seemed to UT to be preferable to the alternative of building parking garages. That was then and this is now, and now UT has built several new parking garages that generate money for UT, while giving money to Metro does not.

So less UT service means increased demand and revenues for UT Parking and Transportation, and the fastest way to justify reduced service is to cite rising expenses (whether justified or not) and the need for "efficiency". Meanwhile, if UT can continue to generate money through student services fees yet give Metro a smaller amount of it, then more money is available for other UT "needs" that are anxious to be addressed through student fees. Every dollar generated in that fashion does'nt count as a tuition increase, a number UT will be sensitive to, at least in the short run, as they've only recently been given the ability to set their own tuition and don't want to appear too greedy. One thing is certain: UT Transportation chief Bob Harkins is zealous about generating revenue. That's why the Denver Boot came to the Forty Acres, the UT Guard Shacks don't have UTPD employees in them anymore, you get a whopping twenty minutes of free parking in the parking garages when it takes ten just to get out of the garage, why "event parking here" placards are in front of every garage whenever out of town visitors come to campus for a special function (even when there's free or discounted state lot parking across the street) and that's why parking spaces on campus that used to be free after 4:30 are now only free after 5:45 pm (another 1:15 to write revenue-generating tickets). Harkins was brought to UT and paid double of his predecessor, Dave Kapalko, on the promise that he would aggressively generate revenue, everywhere possible, by all means available. The Shuttle Bus operation is the big ticket item that promises the largest payoff, if it can be skillfully manipulated. It seems he's trying. Remember the recent Shuttle Survey, even though there's been one about every year for a few years, one may suddenly, in retrospect , find it curious that the questions were designed to offer an either/or choice regarding route service (do you want more of this and less of that,etc.). Subtly the point was attempting to be made that cutbacks were inevitable. Further, anyone thinking about it realizes the survey authors had to know how virtually everyone on campus needs the campus "circulator routes" while decidedly smaller numbers of students (survey respondents) are affected by, and thus interested in, the frequency of any particular outgoing "satellite" route - certainly the questionnaire was designed to downplay all routes coming into campus and accentuate those routes going around campus. Gee, that would work out well for creating garage demand, having few routes coming in to campus but several busses going around campus, Voila, revenue for UT Parking and Transportation. Look for the surveys to continue until the desired feedback results come in, then the "favorable changes in resource allocation" will be even more obvious.

Meanwhile, Metro embarks upon an insidious plan to absorb some of the demand by phasing in more regular fixed routes that coincidentally manage to come by, or through, campus. If you look at past years Metro schedules and pay attention to the frequencies of the shuttles and the overall color coded service map that shows the trail of all routes, it becomes very clear, very quickly, that changes have been underway in the last few years (basically since Harkins came). Metro has reconfigured several routes and even created some Dillo routes in order to serve UT (once every 30 minutes or so, at least). They do this mainly to hide the number and significance of UT riders in their general statistics because it is quite embarrassing to them to have to actually admit the extent to which UT riders are the cornerstone of all their credibility claims as a utilized, vibrant transit entity. But not only does every UT rider on a city route mean one more "real" transit rider, it's one less rider on the UT Shuttle, making it appear Metro is catching on while the shuttle is somehow less utilized - resulting in the next round of "efficiencies" (scratched- or "paired" shuttle routes). In this way Metro and Harkins scratch each other's back while slapping the backs of all the naive students and shuttle workers. But their Gordian knot is not impenetrable.

In the early 90's a similar effort was made to dismantle the shuttle, for some of the same reasons. But then there was not as many advantages for both sides (Metro and UT) to see the plan to its fruition. If the students are going to have a legacy of leaving UT with a transportation system that is both something to be proud of both in terms of quality and quantity, they better take a real interest in helping the shuttle workers and trusting them to keep them apprised of the real state of affairs with Metro and UT, for while each group (including students) has its own self-interests at heart, the shuttle workers and their customers (UT riders) are more closely aligned than the UT money-grubbers and Metro masterminds. Shuttle workers just want a decent job, and the ability to be able to continue providing it. Currently both are compromised, and may shortly become extinct. Please recall extinction is often unidentified as a process in action, typically because what becomes extinct was taken for granted so long it was perceived as inexorably ubiquitous.

Capital Metro's Monday April 26th Board Meeting at 4 pm would be a good place to start letting Metro know if you oppose their plans and service providers. You can sign up to speak on the day of the meeting for three minutes to the board, if you represent a group and get on their agenda 7 days in advance (call Gina Estrada at 389-7458) you can have 5 minutes. Don't trust your own extemporaneous speaking skills? Choose a 3 minute portion of the above to read to the board if you wish, If you don't want to speak at all, that's fine, your presence will be a statement in itself. There will be protests outside and plenty of people in the boardroom too. Then, beginning at 6pm there is a public hearing on the proposed changes (cutbacks) to future shuttle schedules. So it's sort of like a double header. The Metro Offices are at 2910 E,5th (bus route 300 or 17)

Questions? cordieray@alumni.utexas.net