Dallas Area Rapid Transit, which has built out a much more extensive rail network than Metro and which has plans for a lot more, may instead scrap most of those plans due to serious financial issues.
Final decisions are months away, but Chief Financial Officer David Leininger warned the board that DART probably will have to cut nearly a third of the spending it had planned between now and 2030.
Only one building project not already under construction or under contract – the final leg of the Orange Line to Dallas/Fort Worth International Airport – is likely to be saved. And even that rail project will depend on how aggressively the board cuts overhead, including jobs.
Plans for a second light-rail line in downtown Dallas, until now scheduled to open in 2016, will no longer be funded and are likely to be scrapped unless other money can be found. The line has a projected cost of $505 million to $820 million.
Projects that are under construction, including the Green Line rail expansion to Carrollton, scheduled to open in December, and the first two legs of the Orange Line, due by 2012, will be unaffected.
Leininger said the board will need to trim $30 million to $50 million in annual operating expenses. The higher number will be required if DART wants to preserve the Orange Line leg to the airport, he said.
In March, DART officials said disappointing sales tax receipts had caused the agency to take a fuller look at its finances. The agency concluded that its sales tax projections were wildly optimistic.
DART’s revenue problems, the agency concluded, go beyond the recession and are unlikely to improve soon.
For 10 years, sales tax receipts have been essentially flat, Leininger said, and demographic changes in DART’s 13 member cities, especially those in Dallas County, mean sales-tax revenue will probably grow slowly even when the economy recovers.
Dallas County’s population used to be younger, richer and better educated than the national average. By all of those measures, that’s no longer the case, he said.
The new forecasts reduce the agency’s sales tax receipts by $2.7 billion over the next 20 years. But the real impact on DART’s spending will be much higher because those tax receipts would have been used to borrow nearly $4 billion more and to secure about $1.4 billion in anticipated federal grants.
DART will no longer be able to count on any of that money. As a result, it will spend nearly $7.9 billion less by 2030 than the $27.2 billion its 20-year plan calls for now. That’s a reduction of about 29 percent.
That’s a huge amount of infrastructure investment that won’t get made, which will have its own negative effect on the area’s economy and growth. It’s quite the vicious cycle.
You can look at this in a few different ways. You can say “at least we’re better off than they are”, which assuming nothing goes wrong with the FTA is at least true for future construction projects. You can say “that may be us in the future”, which would be a damn shame. Or you can look at it as I do and say “We need to find a better way to fund our infrastructure needs, because they’re not going away”. Frankly, I’d like to see the federal government allocate more money to transit, and to make the process for getting that money more like the process for getting highway money. That’s beyond DART’s scope, but I feel confident they won’t be the only transit agency doing this sort of thing if we continue with business as usual. Oh, and for those of you who sneer at rail transit, remember that TxDOT is broke, too, and for the same basic reason – the funding mechanism we have in place for it is inadequate for its needs. We can’t fix either of these problems until we admit there is a problem that needs to be fixed.