NO on Measure AA
(BART's Massive $980 Million Bond Measure, Actual 
 Taxpayer Cost Expected = $2.1 Billion)

 

Return to ACCT Home Go to Ballot Arguments

 

  
            BART's Measure AA:  No Way to Run a Railroad!

  "WHEN ANY GOVERNMENT agency approaches the taxpayers for huge sums of money, it should 
   have a compelling need for the funds, a reliable estimate of the cost, a clearly defined project 
   and a means for the costs to be borne by all those who benefit. The $1.05 billion seismic 
   retrofit bond, Measure BB, sought by BART falls short on all of the above provisions and 
   should be rejected by voters on Nov. 5" - Contra Costa Times, "No on BART Bonds," 10-27-02

   Measure BB Failed.  Now it's 2004 -- and BART returns with essentially the same 
   measure -- only $25 Million less than in 2002, though BART will receive $389 Million
   from Regional Measure 2 (including $143 Million for the Transbay Tube retrofit), 
   passed by voters in March.    Measure AA should be rejected with equal determination 
   by voters now.   

  BART's Irresponsibility Led to Outrageous Scheme

  The BART Bond Measure is simple to understand.  BART agreed to very expensive Labor contracts 
  at the end of 2001 and beginning of 2002.  By May of 2002, BART announced an entirely predictable 
  $28 Million Operating Deficit, despite cutting funds for seismic retrofits and other capital projects 
  from $26 Million in 2002 to $10 Million for 2003.  Two months later, Measure BB was announced.  

  Measure BB failed, thanks to perceptive voters.  Now they're back with Measure AA, a near copycat
  of Measure BB.  Voters should reject AA as well.  

Small Surcharges and Fiscal Common Sense Would 
Fund Seismic Retrofits, If Truly These Are Needed

  Presuming for the sake of argument that BART's seismic retrofit studies are valid, who should pay 
  for them?  Option 1:  Measure AA -- property owners in Alameda, Contra Costa, and San Francisco 
  Counties, whose taxes BUILT BART, and whose existing sales and property taxes still subsidize 
  41.7% of BART's operating expenses, as is; OR Option 2:  small surcharges (19¢ in 2005*, ranging to   
  inflation-adjusted 35¢ per ticket in 2015*) for BART's heavily tax-subsidized riders -- less if BART ever 
  reins in its incredible spendthrift ways.  

  * Measure AA's first-year payout for principal + interest debt service = $17.72 Million.  Dividing by 
    91,300,000 current annual passenger trips gives surcharge = $0.194, or 19.4¢

  * Measure AA would first hit its maximal payout rate in 2015, when four bond series would be getting
    paid by taxpayers.  Principal + interest debt service then = $70.87 Million.  BART has projected 
    approximately 135,000,000 annual passenger trips by then.  Factoring inflation at estimated 4% 
    each year, passenger-trip surcharge then = 35¢ per  ticket in 2015.

Option 2 = NO on AA !

 BART's Labor contracts are up for renewal next year.   Count on 
 BART managers and "negotiators" to give away the store again!  
 
 AS IS, BART'S 3014.5 OPERATIONAL EMPLOYEES ALREADY AVERAGE  
 $102,799* IN SALARY AND BENEFITS ANNUALLY.  Were Measure AA to 
 pass, it would encourage even worse spendthrift behavior, as BART 
 utilized bond funds to "free up" general fund dollars for more raises.  

 * $309.9 Million in projected 2005 salary and benefits, BEFORE new contract, divided by 3014.5 employees.
    The $102,799 figure is an update from the ballot arguments we participated in submitting; we mistakenly
    previously included 314.5 "capital" employees, who are paid from separate funds.

 

As is, Taxpayers in Alameda, Contra Costa, and San Francisco 
Counties (only) -- whether they ever ride BART or not  --  subsidize 
over 40% of BART's operating expenses...! 

 

Projected Revenues, 2005

Category

Income

% of Total

Fares

$ 239,318,260

50.2%

Other Revenue

$ 38,983,639

8.2%

Tax Dollars

$ 198,600,000

41.6%

Total

$ 476,901,899

100.0%

    "Tax Dollars" include $176,000,000 in sales taxes and
       $22,600,000 in property taxes.  Notice that BART's 
       Labor costs alone far exceed "farebox" recovery.



  Note: Labor Expense alone ($ 309,887,077) 
  far exceeds Farebox revenues ($239,318,260)

Projected Expenses, 2005
Category 

Expense

 % of Total

Labor

$ 309,887,077

65.0%

Express Buses

$ 2,500,000

0.5%

ADA Paratransit

$ 10,300,000

2.2%

Purchased Transp

$ 2,339,841

0.5%

Electricity

$ 21,346,740

4.5%

"Other Non-Labor"

$ 67,843,733

14.2%

Debt Service

$ 62,684,508

13.1%

Total

$ 476,901,899

100.0%

 Thanks to BART's irresponsible budgeting, Labor
 has gone from 59.8% of the budget two years ago
 to 65.0% now. Average compensation: $93,091

“BART is facing a budget crisis that is largely of its own making.” — Times, 4/16/02

(Note that BART's per-employee total compensation -- salary and benefits -- has grown at almost 3 times the inflation rate from year 2000 to year 2005.  More responsible budgeting could provide seismic-retrofit dollars.)

Dollar Figures and Annual Ridership Are all in Millions (000,000)

Budget Category

2000

2001

2002

2003

2004

2005, 
Projected

 D, 2000 to 2005

Operations Revenue

$ 202.6

$ 236.3

$ 224.0

$ 221.1

$ 257.7

$ 254.4

25.6%

Property + Sales Taxes

$ 174.4

$ 203.5

$ 194.9

$ 195.6

$ 191.9

$ 198.6

13.9%

Other Revenues

$ 0.7

$ 1.2

$ 1.3

$ 2.0

$ 11.1

$ 23.9

3292.3%1

Total Revenues

$ 377.7

$ 441.0

$ 420.2

$ 418.7

$ 460.7

$ 476.9

26.3%

2000

2001

2002

2003

2004

2005, 
Projected

 D, 2000 to 2005

Labor Expense

$ 226.6

$ 242.2

$ 251.5

$ 257.2

$ 287.9

$ 309.9

36.7%2

Other Operating Expenses

$ 88.8

$ 95.3

$ 99.6

$ 106.0

$ 108.6

$ 104.3

17.4%

Debt Service & Allocations

$ 62.2

$ 103.5

$ 69.0

$ 55.5

$ 64.2

$ 62.7

0.8%

Total Expenditures

$ 377.7

$ 441.0

$ 420.2

$ 418.7

$ 460.7

$ 476.9

26.3%

2000

2001

2002

2003

2004

2005, 
Projected

 D, 2000 to 2005

Annual Ridership

91.1

97.3

90.8

87.4

91.3

93.7

2.9%3

# of Operational Employees

3,057.0

3,106.0

3,140.0

3,064.0

3,157.5

3,014.5

-1.4%4

Average Compensation per Employee 
(Salary + Benefits)

$74,130

$77,981

$80,106

$83,950

$91,166

$102,799

38.7%5

Bay Area CPI, June

179.1

190.9

193.2

196.3

199.0

203.0

13.3%6

# of "Capital" Employees

394

?

458

453

331

314.5

-20.2%

1 Large percentage increase due to BART to SFO and "Leaseback" Revenue ("Leasebacks" are complex deals in which BART    
    sells to private-sector investors the right to depreciate BART's capital equipment (since BART is unable as a public-sector 
    entity to take depreciation tax benefits); BART retains control of the equipment (passenger cars, for example), and yet 
    receives $$$ while the investors receive (presumably) a greater tax benefit than the amount they pay BART.  We had no
    idea such schemes were legal.  

2 That's right:  BART's salary and benefit costs for operational employees have gone up 36.7% since year 2000!

3 If BART's 2005 ridership projection holds

4 Now does not include "capital" employees

5 Mistakenly included "capital" employees previously, which (also mistakenly) lowered compensation per employee to $93,091

6 For now, 2005 CPI growth is a guess.

  

Comparing Measure BB (failed in 2002) with Measure AA (hopefully, failed in 2004)
(These are essentially identical measures; BART is trying to misrepresent them as very different, and to overplay a possible 50% Million fare surcharge as being of far greater magnitude than it is.)
 

$ Figures in Millions (000,000) 
  AA BB
Bond Measure Principal

$1,005.0

 $980.0
Retrofit Money from RM2 (for Transbay Tube)

none

 $143.0
Fare Surcharges? (Times, 9/9/04)

none

 $50.07
Retrofit Dollars Available $1,005.0 $1,173.0
Projected Interest Cost $1,148 $1,146
Total Measure Payback Cost $2,153.0 $2,126.0
Payback Term 40 years 40 years
7 The $50 Million surcharge being advertised by BART would be only 5.1% of Measure AA's principal.  All of 
    that $980 principal + $1.1 Billion in interest would be paid by property owners whose sales and property
    taxes already subsidize 41.6% of BART's operations budget.
 
  $ Figures "As Is"
  AA BB
Anticipated Minimum Tax Rate per $100,000 A.V. $3.31 $4.85
Anticipated Maximum Tax Rate per $100,000 A.V. $14.16 $12.79
Anticipated Average Tax Rate per $100,000 A.V. $7.80 $7.04
     
Lowest Fare Surcharge Needed Instead   19¢8
Highest Fare Surcharge Needed Instead   53¢9
8 (First payback year, 2005; surcharges here assume no BART budgeting improvement.

9 (Inflation adjusted from 78¢nominal surcharge, assuming 4% inflation per year, in 2014-15 -- but not 
   assuming here the increased ridership projections that BART has made in the past.  With the 135,000,000 
   passenger trips we've seen in some BART projections, the surcharge in the inflation and passenger-trip 
   adjusted amount would be only 35¢.)

There is already a large disproportion in transportation spending

 

More Needs to Be Done About Congested Freeways

  FROM THE BALLOT ARGUMENTS:  

  "Seeing this ballot’s relentless hit parade of 
   new tax schemes, voters should challenge 
   BART’s large public-fund expenditures*, 
   beginning last July, to promote Measure AA."  

 
 *Voters were sent promotional mailers, at public expense, supporting  
   Measure AA.  The covers of two of these mailers are shown.

  Public Agency Funding of New-Tax Promotions?

  Such promotions are impermissible:  California’s Supreme 
  Court has ruled that in such cases, "a public agency may not 
  expend public funds to promote a partisan position in an 
  election campaign....  The style, tenor, and timing of the 
  advertisement placed by the board of trustees points 
  plainly to the conclusion that the publication was 
  designed primarily for the purpose of influencing the 
  voters at the forthcoming... election’" [Stanson v. Mott  
  (1974), 17 Cal.3d 206, 209-210, 217, 222]
  
  For more detail on the case, see our discussion of the East 
  Bay Regional Park District's own illegitimate use of public 
  funds in pushing its parcel tax campaigns.    

  The Alameda Department of Elections has primary jurisdiction over the BART Bond Election.  
  Promoters and Opponents of Measure AA submitted ballot arguments to that department on 
  Aug. 16 and Aug. 23.  Those arguments are presented below, in the order in which they will 
  appear in the voter pamphlet.

 

rtsign.gif (437 bytes) Initial Argument by Measure AA Tax Promoters leftsign.gif (436 bytes) Rebuttal by Measure AA Tax Opponents
leftsign.gif (436 bytes) Initial Argument by Measure AA Tax Opponents rtsign.gif (437 bytes) Rebuttal by Measure AA Tax Promoters

 

                                 Ballot Argument in SUPPORT of Measure AA 

Vote Yes on Measure AA to assure BART’s quick return to service after a major earthquake. The Bay Area could be gridlocked without BART during years of rebuilding. With Measure AA, BART could be back to service in days. Measure AA will strengthen the TransBay Tube, elevated trackways and passenger stations.

Vote YES on Measure AA to protect safety. World-renowned experts have determined that elements of the BART System are vulnerable to earthquakes. Experienced engineers agree that earthquake improvements made possible by Measure AA will work.

Vote YES on Measure AA to keep the region moving. Whether you ride BART or not, a BART shutdown will affect everyone. Experts say a BART shutdown will add 310,000 more tips to Bay Area roadways. Each weekday, BART carries 150,000 transbay trips.  During peak commutes, BART carries as many trips as the Bay Bridge.

Vote YES on Measure AA to make critical earthquake safety improvements.   
Earthquakes are inevitable in the Bay Area. Measure AA will ensure BART is prepared.

Vote YES on Measure AA to protect the Bay Area’s investment in BART.   
Engineering experts say a major earthquake on the Hayward fault, for example, would dramatically affect BART’s ability to transport commuters for up to 2% years. BART’s estimated value is conservatively 
$15 billion – 15 times the cost of Measure AA.

Measure AA will reduce damage to the system, save billions in repair costs and help BART get the region moving again, while highway commuters contend with freeway and bridge reconstruction.

Measure AA protects your tax dollars, It is an earthquake insurance policy for the entire Bay Area. It will allow state-of-the-m advances in earthquake safety technology and construction techniques to increase safety, save money and reduce gridlock after a major quake.

Vote Yes on Measure AA
Doug Knudsen -- Earthquake Engineering Research Institute, President 
 
L. Thomas Tobin -- California Seismic Safety Commission, Former Executive Director

James Fang -- BART District Board President

Ruth C. Abbe -- East Bay League of Conservation Voters

Charles Plummer -- Sheriff, Alameda County

rtsign.gif (437 bytes) Initial Argument by Measure AA Tax Promoters leftsign.gif (436 bytes) Rebuttal by Measure AA Tax Opponents
leftsign.gif (436 bytes) Initial Argument by Measure AA Tax Opponents rtsign.gif (437 bytes) Rebuttal by Measure AA Tax Promoters


REBUTTAL TO ARGUMENT IN FAVOR OF MEASURE AA

TUESDAY, NOVEMBER 2, 2004

   Earthquake safety, rapid service recovery, and repair-cost savings should be 
   priorities for BART passengers, too — including tourists and other riders from
   outside BART’s District area! Yet Measure AA demands more tax dollars just 
   from property owners (and indirectly, renters) — BART riders or not — in 
   San Francisco, Alameda County, and Contra Costa County only.

  • Presuming BART’s updated seismic studies to be valid, responsible budgeting
    + small passenger-fare surcharges on 91,300,000 current passenger trips
    annually could fund seismic retrofits    .     Bart itself says fares "have increased less 
    than the rate of inflation since 1997."
  • Taxes and bridge tolls funded BART’s construction. Property and sales taxes 
    still     fund over 40% of every BART ticket! (    Actual: 41.7% of BART’s $461 Million
    operating budget) [41.6% projected in 2005]
  • In 32 years, earthquakes haven’t caused significant BART interruptions.
     But strikes by BART’s richly compensated employees have — 6 days in 1997,
    3 months in 1979.
  • During 1989’s Loma Prieta quake, BART engineers reported, "All BART
    facilities performed well,"     having been constructed "to a higher level of 
    seismic resistance than prevalent practice." Transbay Tube passengers 
    "didn’t even sense there had been a major earthquake."
  • Seeing this ballot’s relentless hit parade of new tax schemes, voters should 
    challenge BART’s large public-fund expenditures, beginning last July, to promote 
    Measure AA.

   Anticipating similarly cozy special-interest funding of BART’s Measure AA
   campaign, we hope you’ll join our grassroots effort, and… 

Vote NO on AA!

More information: www.ACCTaxpayers.com, (800) 947-ACCT

  Arne Simonsen —                                             Mary Lopez — Community Activist, Richmond
  City Councilman, Antioch                                     

  Barbara R. Mescunas — President,               Elsa Cheung — Chairwoman, Citizens
   Coalition for San Francisco  Neighborhoods     Opposing Unreasonable New Taxes,
  (for identification  purposes only)                        San Francisco
  

  Marla J. Kaste — Co-Founder, Concord
  Association of Taxpayers

 
rtsign.gif (437 bytes) Initial Argument by Measure AA Tax Promoters leftsign.gif (436 bytes) Rebuttal by Measure AA Tax Opponents
leftsign.gif (436 bytes) Initial Argument by Measure AA Tax Opponents rtsign.gif (437 bytes) Rebuttal by Measure AA Tax Promoters


ARGUMENT AGAINST MEASURE AA

TUESDAY, NOVEMBER 2, 2004

   As the Oakland Tribune warned in 2002: "Bay Area residents and commuters be  
   aware. BART is setting its sights on our pocketbooks." Now, BART again seeks 
   taxpayer subsidies, anticipated principal + interest cost = $2.1 Billion.

  • In 2001, BART "knuckled under to union demands in a ridiculous contract" (Contra Costa Times, 8/5/02). The result? Anticipated 2005 total compensation costs averaging $93,091 annually, for 3329 employees — with new contract negotiations next spring.
    [Note:  We've discovered more recently that the actual average salary and benefit
    cost, for BART's 3014.5 operational employees, will be     $102,799 in 2005, even 
    before new contract negotiations begin.]
  • By May 2002, BART’s general manager, facing predictable deficits, reported
    having "to defer many new projects… including system rehabilitation…
    and seismic improvement"     (FY 2003 Preliminary Budget).
  • Two months later, BART’s bureaucrats rolled out a large seismic improvement bond measure, expected to cost Alameda, Contra Costa, and San Francisco County taxpayers $2.2 Billion (principal + interest) if passed. Fortunately, it failed.
  • As the Times editorial continued: [BART,] "You have increased fares… cut
    back services… laid off… union workers because of the contract you signed…."
    ("Expect Voter Backlash," 8/5/02).
  • New bridge-toll increases, paid mostly by commuters who seldom ride BART, will hand BART $389,000,000 — including $143,000,000 toward Transbay
    Tube seismic retrofits.

   BART-tax promoters advertise Measure AA’s "minor cost." But notice:

  • Taxes already consume half the next dollar earned by many Bay Area families. 
    That happened bit by bit.
  • So now, "Americans spend more money per capita on taxes ($10,447) than  
    on food ($2,713), clothing ($1,436), and shelter ($5,913) combined" 
    ("Tax Facts," San Francisco Chronicle, 3/27/02).
  • Taxpayers cannot continue financing every out-of-control program, or imagined solutions to every contingency. Regarding BART’s demands, the Tribune 
    wisely advised "looking at alternatives that include paybacks of funds Californians 
    have already sent to Washington."

   Bonds = taxes! Special-interest beneficiaries of BART’s spendthrift habits will richly    
   fund BART’s campaign for higher taxes. In contrast, we are grassroots campaigners 
   for fiscal sanity.

Please vote NO on BART Bonds!  

  Alliance of Contra Costa Taxpayers                   Citizens for Responsible Government
  Kenneth E. Hambrick, Chairman                          Kenneth Arras, Chairman

  East Bay Libertarian Party                                     Save El Sobrante  
  Curt Cornell, Chair                                                   Marilynne Mellander, Coordinator

  Waste Watchers, Inc.
   Kenneth D. Steadman, President



rtsign.gif (437 bytes) Initial Argument by Measure AA Tax Promoters leftsign.gif (436 bytes) Rebuttal by Measure AA Tax Opponents
leftsign.gif (436 bytes) Initial Argument by Measure AA Tax Opponents rtsign.gif (437 bytes) Rebuttal by Measure AA Tax Promoters

Rebuttal Argument in Favor of Measure AA

Measure AA is a good deal for taxpayers.  It makes necessary safety improvements as soon as 
possible, before costs go up. By strengthening the BART system now, we will avoid far greater 
rebuilding costs after an earthquake.

Measure AA will speed BART back into service while highways and bridges are being reconstructed. 
It will save lives, maintain economic vitality, and avoid gridlock. And an independent oversight committee will protect taxpayers’ investment.

"BART kept the Bay Area moving after the 1989 earthquake," says A. Lee Blitch, president and 
CEO of the San Francisco Chamber of Commerce. "Next time, we need BART back quickly to 
transport safety workers, to get people to their jobs and to help the Bay Area recover faster."

Earthquake safety technology has advanced rapidly in the 15 years since the Loma Prieta quake. 
 The BART system is getting older. Experienced engineers and scientists say strengthening 
the BART system will work. Measure A will increase safety, reduce damage, save money and 
keep the Bay Area moving.

BART carries 45% of peak transbay traffic. In Alameda County, 20 million trips a year

are on BART. In Contra Costa County, 50 % of all transit rides are on BART. Even people who 
don’t use BART enjoy the benefits. Without BART, commute times would double or more. 
The Bay Area can no longer function without BART. 

Earthquakes are a very real problem for the Bay Area. When a reasonable solution is to a 
very real problem, we should vote for it.

Vote Yes on Measure AA.
Joseph J. Haraburda -- Oakland Metropolitan Chamber of Commerce, President & CEO

Virginia Hamrick -- Rossmoor Homeowner
Jack P. Moehle, PhD, CE -- Pacific Earthquake Engineering Research Center, Director

Jim Wunderman -- Bay Area Council, President & CEO

William J. McCammon -- Alameda County Fire Department, Chief

 

This page was last updated on 10/03/04