A highly critical analysis of C-Tran’s finances released ahead of next week’s vote on Proposition 1 argues that the agency could last much longer without the benefits from a sales tax increase — and without cutting bus service — than leaders have said.
Forensic accountant Tiffany Couch sent her formal analysis to C-Tran board members Thursday. But C-Tran fired back with its own response sent to the board Friday, calling the analysis and its conclusions “fatally flawed.”
Proposition 1 would raise C-Tran’s portion of the local sales tax from 0.5 percent to 0.7 percent, raising an additional $8 million to $9 million annually for basic bus service.
C-Tran operates at an annual deficit, and agency leaders have said available reserves will run dry and force major service cuts by 2013 should the measure fail. The agency has been in financial turmoil since losing much of its state funding in 2000.
Couch claims in her analysis that C-Tran could keep its bus service intact with existing reserves until 2023 — if it forgoes expenses related to high-capacity transit projects. She also argued that C-Tran has directly prioritized those efforts over basic bus service.
“Based on my review of documents and meetings with C-Tran officials, it appears that not only are the C-Tran planned budget deficits significantly inflated, they also include millions of dollars worth of planned high-capacity transit expenditures, expenditures for potential future bus rapid-transit and light-rail services that have nothing to do with current C-Tran bus services,” Couch wrote.
In its response Friday, C-Tran took issue with Couch’s claims. Public affairs director Scott Patterson said in an interview that Couch used incorrect numbers and “changes board policy to produce an unrealistic outcome.”
C-Tran said Couch used incomplete expense projections that don’t account for expenditures that haven’t happened yet due to the timing of certain projects. Patterson also disputed Couch’s analysis of C-Tran’s 2011-12 budget, in which she identified more than $11 million in “potential high-capacity transit activities.”
C-Tran’s involvement on that front has been well-publicized. The agency is planning a proposed bus rapid-transit line along Vancouver’s Fourth Plain corridor and is working with the Columbia River Crossing on a planned light-rail extension into Vancouver as part of the more than $3 billion project.
The $11 million in high-capacity transit expenses Couch listed included BRT analysis, collaboration with Oregon’s TriMet on replacing fare boxes and other efforts, plus other BRT and light-rail initiatives in C-Tran’s 20-year plan.
Patterson and C-Tran Director of Administrative Services Diane O’Regan pointed to only $1.3 million being spent on high-capacity transit in the current budget. Those dollars would cover ongoing BRT planning, election costs for next year’s planned ballot measure — separate from Tuesday’s Proposition 1 — and a state-mandated “expert review panel” to set that up.
Couch’s other listed expenditures are a stretch, Patterson said. Fare boxes, for example, aren’t used in either BRT or light-rail systems. But Couch said C-Tran’s list only includes operational expenses, not capital costs.
Couch argued that C-Tran simply can’t afford those efforts, and preserving bus service would only require a policy change away from them — not an increase in the local sales tax.
Upon seeing C-Tran’s response to her analysis, Couch disputed the transit agency’s objections and stood by her work.
Couch said she wrote the financial analysis independently and without payment. She has, however, been hired by Vancouver businessman and Columbia River Crossing critic David Madore to take a close look at that project’s books.
C-Tran is asking for a sales tax increase because it needs to, not because it wants to, Patterson said. He noted a board vote earlier this year that stated Proposition 1 revenue would not be used for light rail or any part of the CRC. That’s why leaders separated next year’s ballot measure, the money from which would pay for the operation of BRT and light rail, he said.
“This isn’t something that the agency takes lightly,” Patterson said.
Ballots for Proposition 1 and other local races must be turned in or postmarked by Nov. 8.
Eric Florip: 360-735-4541; www.twitter.com/col_enviro; eric.florip@columbian.com.
