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Metro Board Adopts Budget

The Metro board today adopted a new budget today after General Manager John B. Catoe Jr. assured the board members that the spending plan was balanced. Catoe has spoken recently about the possibility of a fare increase as early as January, and that had left some people -- including me -- confused about whether the staff reductions and other money-saving measures imposed by the new GM had indeed balanced the budget.

"This budget does not require nor does it seek a fare increase in order to be balanced," Catoe told the board.

In response to a follow up question from board member Jim Graham, who represents the District, Catoe added: "My view is that as we look forward into the future, the earlier you have any fare increase -- should one be approved by the board -- would bring in revenues to offset possible deficits in the future."

"There's no proposal before you today to discuss, consider or vote on any fare increase."

Catoe has spoken before about his desire to establish a fare increase system tied to some logical and predictable standard, like the cost of living index. He promised there would be no fare increase in this calendar year, but he knows that Metro's expenses will eventually rise to the point where cost cutting won't suffice. When a fare increase does come, he doesn't want it to be a big jolt to riders.

Graham expressed his satisfaction with Catoe's reassurances on the new budget, which takes effect July 1. But also said: "The issue of a fare increase is a very sensitive issue for this board. We have resisted these increases now for several years. Any proposal for a fare increase would be a matter for great scrutiny by this board."

The last-minute question of the budget's true state might obscure the fact that Catoe came in and did something pretty remarkable. He arrived in the middle of the movie. The Metro staff, concerned about rising expenses and flattening revenues, had proposed a big, complicated round of fare increases late last year. After Catoe came in at the start of this year, he put those proposals on hold and told the board he wanted to first satisfy himself that expenses had been cut as much as they could be.

So with very little time, he did that, cutting 220 staff positions before coming back to the board with a $1.2 billion operating budget that maintained services and avoided a fare increase. Pretty good start for the new guy.

By Robert Thomson  |  June 28, 2007; 2:04 PM ET
Categories:  Metro  
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