Bridging the Gap- PDOT Budget Review Task Force Meets
Sam Adams
As you might already know, the Portland Office of Transportation (PDOT) is facing a significant gap between its revenues and its expenditures. Currently, it's projected that we are facing roughly an $8 million annual shortfall in PDOT's General Revenue Fund, or about $43 million over 5 years.
The two main sources of this shortfall are increased construction and operating costs due to fuel and basic materials like steel, and a decrease in the amount of Oregon State gas tax revenue being allocated to Portland.
This leaves me in the position of having to bridge a pretty sizeable funding gap. That is why I convened the PDOT Budget Review Task Force to go over PDOT's budget and find ways we might save money while still providing the city with the current level of services.
I have said many times that I want to maintain the level of service that Portlanders have come to expect; instead of cutting these front-line services, I am hoping to save money through unlocking efficiencies in administration that may have gone untapped up to this point. I campaigned on a pledge of not pursuing new taxes until after the school funding problem is fixed, and I intend to stick to that pledge.
Also, I insist on being a good steward of Portland's infrastructure. I don't want to skimp on things today that will simply cost taxpayers more in the future. I don't want to be a penny wise but a pound foolish.
That is why I brought in experts to find areas where we might be able to save money, while providing the services the public expects and doing so in the most economical way over the long run. These experts and a very diverse group of transportation stakeholders and advocates are working together to bridge the budget gap in the best way possible.
We will be having a public forum on December 13, from 5:30 to 7:30 in the World Trade Center. I encourage you to come so that I can hear your views on the services you expect, and get ideas about where to save the public money. Also, I welcome you to post your comments on how to deal with PDOT's budget woes. Here is a summary of the task force's first meeting.
Thanks,
Sam Adams
P.S. Thank you to Chris Smith, who provided us with the photo above, and who manages the great website www.PortlandTransport.com.
Portland Department of Transportation
Budget Advisory Task Force
First Meeting
December 1, 2005
9:30 a.m.-12:00 noon
Portland City Hall Rose Room
1. Introductions and Ground Rules (Don Barney)
Don Barney, Barney & Worth, Inc., Task Force facilitator, reviewed the meeting agenda and led the group in a round of introductions.
Task Force Participants included:
Commissioner Sam Adams;
Robert Bertini, PSU;
Kathy Busse, Washington County;
Olivia Clark, Tri-Met;
Corky Collier, Columbia Corridor Association;
Michael Dehner, Local 483;
Gary Eichman, Oregon Transfer Company;
Ann Gardner, Schnitzer Investments;
Patricia Gardner, Neighbors N.W.;
Cam Gilmour, Clackamas County;
Jim Laubenthal, Port of Portland;
Carter MacNichol, Shiels, Obletz and Johnsen;
Bonnie McKnight, Eastside Neighborhood Association;
Evan Manvel, Bicycle Transportation Alliance;
Brian Newman, Metro;
Adrian Pearmine, IBI Group;
Lidwien Rahman, Willamette Pedestrian Coalition;
Chris Smith, Transportation Activist;
Jason Tell, ODOT;
John Wheeler, AFSCME;
Rick Williams, Lloyd District Transportation Management Association;
Dan Yates, Portland Business Alliance;
Observers and consultants included: Don Barney and Michele Neary, Barney & Worth, Inc.; Tim Bretz and Ned Dempsey, Century West Engineering; Roger Byrne and Philip Tiewater, GHD; Bureau of Environmental Services staff; PDOT staff, and Commissioner Sam Adams’ staff: Roland Chlapowski and Tom Miller.
2. Welcome and Task Force Charge (Sam Adams)
Commissioner Sam Adams reviewed the challenges before the Task Force, primarily lack of mobility; predictability and reliability issues; and safety. Portland’s economy is tied to transportation more than any other city on the West Coast, measured per capita. Portland is both a gateway and a hub, and faces huge and growing issues with congestion. One of the city’s challenges in pursuing solutions is that it has an $11 million shortfall in discretionary gas tax revenue. Portland Department of Transportation (PDOT) gets some of its revenue through contracting services. PDOT also faces a backlog of maintenance. The city wants to offer citizens multiple choices to get to their destinations. Portland is behind on the issue of freight mobility. The Commissioner’s office has a short time-frame to put together this budget – this Task Force begins the process to advise Sue Keil and Commissioner Adams to be sustained. PDOT’s issues are part of a regional discussion, and Commissioner Adams wants to move the city toward a more regional decision making process. The Task Force features representatives from Clackamas and Washington Counties.
3. PDOT’s Key Fiscal Issues, Task Force Expectations (Sue Keil, Ken Kinoshita)
(See PowerPoint attachment)
Sue Keil, Director of Public Transportation for the City, led a presentation on key fiscal issues at PDOT, which were made available as a handout. Key points included:
• The Department has less money than needs, but not due to new programs or assets;
• Over the next 5 years, PDOT has a $43 million funding gap. Beginning in July, the Department has a shortfall of $5.5 million;
• PDOT has a budget of $187 million;
• PDOT’s General Transportation Revenues are $68 million (37%);
• PDOT receives revenue from State Highway Trust Fund and parking revenue;
• Revenue increases have not kept pace with the increases in costs, including health care benefits, gas prices, asphalt, and PERS debt service costs.
4. Budget Process Presentation (Philip Tiewater and Roger Byrne, GHD)
(See PowerPoint attachment)
Roger Byrne from GHD led a presentation about the Budget Review process. Portland is starting to build a picture of how it can manage levels of service and cost of service. Philip Tiewater introduced the concept of the Triple Bottom Line, or the 3 costs which will be analyzed during this process: social, economic, and environmental. PDOT will look at both short-term and long-term horizons. The more the Task Force understands how the Department’s money is spent and the ramifications of those decisions, the better it can project what is needed in the future. One goal is to cut some money out of the PDOT budget, with minimal impact on its very important programs. First goal of the process: an efficient community conversation. The consultant team will help (1) rank importance of issues; (2) create an importance rating; and (3) identify the gaps. The team will involve the community in this process at a Public Forum on December 13, and integrate the advice of the Advisory Task Force into its recommendations.
5. Task Force Information Materials (Don Barney)
Don Barney reviewed the packet of materials: agenda, description of the process, PDOT vision and values, and Customer Satisfaction Survey transportation report. Materials will be electronically distributed to Task Force members and made available at www.commissionersam.com.
6. Task Force Discussion (Don Barney, facilitator)
Ideas: Community Values
• Mobility
• Safety
• Predictability
• Choices
• PDOT Values
• Predictability
Certainty
Awareness
• Availability of public information
Media: main source
511 – limited info to users
• Health impacts of transportation system
• Overcome land use – transportation disconnect
• Home-to-work inefficiencies
• Regional infrastructure decisions
• Efficiency
Mobility
Intelligent transport systems
Public service links (TriMet, PDOT, Port, etc.)
• The automobile piece
Limits of transit on getting to work – too many transfers, or no transit capacity
Recognize car serves, helps poor to work
• Freight
Jobs, transport of goods crucial piece of puzzle
Status not good: congestion, lane widths, turning areas, size of trucks growing
• Access to land, jobs
• Innovation
• Resources / human
• Collaboration
• Sustainability
Alternative choices
Funding sources
Workforce – replace experience
• Mobility
Regional sharing to determine new development areas
• Diversity of options
Don Barney began the discussion on community values, to build on the issues raised by Commissioner Adams on the issues of mobility, safety, and predictability. Mr. Barney reviewed the PDOT goals, mission and values.
Community Values: Task Force Discussion
• I also heard Commissioner Adams say that choices in transportation options were important.
• One of the things that the Commissioner talked about was predictability. That could mean that the transportation system is the same every day; another interpretation is that people are aware of the conditions – so if weather conditions change, people are aware of the changing routes. What is missing seems to be a discussion of the availability and quality of transportation information being provided. The vast majority of the public gets its information from broadcast media. Some call the 511 number offered by ODOT – but this has limited information. When people are aware of conditions, it improves their perception of the level of service.
• The health impacts of our transportation system – safety, chronic health problems, obesity, livable community aspects. Looking at how our transportation system impacts chronic health problems and encourages active transportation (walk, bike) as opposed to less healthy transportation choices.
• Some school bus systems have restricted a number of pickup spots, and stop quite a distance from the school, to get students to walk more.
• Predictability: that is true for all modes – for example, I was on the light rail, it hit something, and stopped, and no one was able to say how long it was going to be delayed. With more information, users can make better choices.
• There is a serious disconnect between land use planning and development and investment in transportation. We don’t do a good job of directing people to live where transportation already exists. In East Portland, we don’t have sidewalks or real transit choices. Riding a bicycle is unsafe and difficult. It creates home-to-work inefficiency.
Community Values, Continued
• Efficiency through prioritization of modes, uses, investment;
• Sound investment in community development; signage for tourism, for example;
• PDOT: big picture mindset needed. Consider impacts on work practices on businesses, citizens;
• Disaster planning: transportation piece – evacuation plans missing;
• Triage necessary on a regional basis in setting priorities;
• Safety: more emphasis on neighborhoods, pedestrians, transit users;
• Social equity – rising cost of transport: impacts on both public and private sector transportation budgets and household budgets;
• PDOT – protecting investment and place it in regional context; assure integrity of system. Roads will require investment, be positive part of equation;
• Connectivity of system – this is especially a problem outside of city center. Can’t get from here to there. Outside core different set of conditions; look regionally; car is essential in this context;
• Coordination: in improvement of fixing, improving the streets among agencies, utilities when new infrastructure is installed;
• Getting multiple values per dollar in constrained budget. Leverage more out of money spent.
• Efficiency in mobility (transferring from bus to bus and between streetcar and light rail). You lose one third of ridership if you force a transfer. Rather than building new facilities, get as much out of what you already have. Provision of public services: look at duplications between PDOT, regional, Tri-Met, Port of Portland services. We are undertaking a regional freight plan. I think there are opportunities in travel options (bicycle, pedestrian) and see how we can work more efficiently together;
• Problems with the inefficiency between the different levels of government and also regionally. All the agencies need to be working closely in order to achieve our goals;
• The automobile’s role: Portland State has been doing a 20-year study. The number one correlation of people coming off the poverty roles is auto ownership. Nonprofits are now subsidizing auto ownership. Mass transit is a nice concept, but it’s limiting on job opportunities, and tends to add a lot of hours to the work day of the poor. I’ve had a hard time retaining employees who live on the east side because the transportation options are poor and unsafe. Portland should stop the war on the automobile, recognize that the auto is one of the best ways to get people to work, and the way people are living;
• Perception of the city, PDOT and the automobile: it would be nice for people to know where the SmartPark garages are. PDOT says we are supposed to get people out of their cars. A cultural shift has to happen. Perception trafficked is that car is the enemy;
• Movement of goods and services: The business community needs to chime in here – freight efficiency and issues need to be addressed. When you go to Safeway or Nordstroms, you expect the item to be there when you want it. The state of affairs currently is not good – the deficiencies include congestion problems (Portland Business Alliance, Port of Portland and Metro just completed a study). You need larger and larger trucks to have a payload these days. You need to have some room to have these trucks maneuver around the city, in order to deliver the goods and services we expect;
• The freight mobility issues: it’s a bit of a problem right now, but it will be an extreme problem in the not-too-distant future. We need to recognize that now and start shifting the mindset. Instead of making the car and the road the enemy, we are going to have to invest in our roadways to support truck traffic and mobility. Don’t continue to vilify roads. This might be a more positive way of encouraging investing in roads – talk about freight mobility;
• Innovation and collaboration – both of these are tied to intelligent transportation systems. In a budget-cutting or streamlining environment, I wouldn’t want to see the people who make up PDOT staff stifled in coming up with new ideas. There is a cost to collaboration – time and energy. I’d want to continue to see that be a value in that organization. PSU is beginning a 5-year program with OSU and University of Oregon on transportation;
• Sustainability: I would urge the Task Force to consider adding sustainability as a value. Importance of reducing environmental impacts through transportation option. Think about sustainability in terms of funding and financing. PDOT needs a sustainable financing source;
• Add workforce to the sustainability piece – more than half of the staff, engineers will be retiring, and we don’t have the talent to replace those positions;
• Quality of investment: I think there is a value on mobility. You have vast differences in the city of Portland – old areas and new areas, lack of walking space. The money tends not to be there for those investments. Equity of investment; and what is a “basic level of service”;
• Diversity of options available – everything from sidewalks, bike lanes, transit lanes, autos, parking. You have to have them all for a livable community. You can’t have a community based on one form of transportation – it’s not economically viable;
• Priority setting: We live in a world of constrained budgets. In the Lloyd District, we find that it’s more efficient to put an employee on a bus, sidewalk, or bike, because it helps the freight move. On the freeway, the priority is freight. We’ll probably have this discussion again for 15 years – how we are prioritizing the roadways. It’s also about investment: where do we want people to live, and where are people living? Sometimes we are not tying our transportation options to our other planning;
• Efficiency in our work practices. I’d like to see PDOT adopt working more than an 8-hour workday, and getting the project done quicker, on their projects, especially in downtown. Naito Parkway will be torn apart for 18 months, with an economic impact on everyone who uses it, including freight. It boggles me that we don’t work around the clock like real cities do on these projects that have a profound impact on the community. When PDOT is constructing or impacting something, they should consider more seriously the impact of their work practices on citizens and businesses;
• Disaster planning: Portland has no disaster planning whatsoever. Burnside is considered a major evacuation route. We don’t have major evacuation or supply routes that are designated and protected;
• Safety: In my neighborhood, I feel the drivers are going too fast. For pedestrians, crossing the street can be unsafe. On the transit system, there is a perception that it’s not safe to ride at certain times of day and in certain areas. It comes back to the kind of investments that we make;
• Transportation costs: Transportation is becoming the largest percentage of household cost, because we are too dependent on the automobile. I have concerns of externalized costs in businesses and households – car parking, congestion, health care budgets, productivity of employees and absenteeism;
• Stewardship: PDOT has a stewardship role to protect the infrastructure within the context of the region. City streets often serve a regional goal. We are sometimes inclined because of funding, to take a narrow view. PDOT has a structure to maintain the integrity of the system;
• Connectivity: There is no connectivity in Washington County. I’m used to a very refined grid system such as we have in Portland. It’s an enormous problem. The arterials in these suburban counties are congested. It’s right for Portland to be oriented towards transit, because they can’t grow themselves out of the problem. To think regionally, think about the conditions in the suburbs that are now becoming major sources of employment. When we look at this regionally, instead of being viewed as anti-car, think about yes, we need some big roads for connectivity for freight and for when people need a car. When we’re starting to think big, think about connectivity, and those areas which don’t have the grid system such as we do here in Portland. Big companies like Intel or Nike can’t have all employees live near where they work. Their methods for attracting workers is regional;
• Coordination between PDOT, the building community, and other agencies in installing or fixing infrastructure – citing a paving project which was then dug up two weeks later for the streetcar project and waterfront development. Utilities are part of this problem;
• Leveraging for more value: The public expects PDOT to deliver on these values. With limited resources, the investment decisions that will be made need to look at how many benefits and values we can address with every dollar. How do we leverage more value from the dollars we spend? There are some strategic things we can look at in the budget process. Will this investment attract other dollars to transportation, for instance?
• Tri-Met reminds the city that PDOT is a key player, because every transit rider is also a pedestrian.
Budgetary Process: Task Force Discussion
• The gas tax revenue was mandated to go to roads. Does that create constraints on your budget process? Response from Sue Keil: PDOT puts very little into capital. The Department is not so constrained, there are no limitations on the meter revenue, but you can only spend it so many times.
• Please clarify the $19 million for “contracts” on PDOT resources. Response from Sue Keil: PDOT receives funding from ODOT or Tri-Met to do a project; sometimes funding comes from federal dollars. For instance, Burnside-Couch planning activity with the engineers comes from PDC dollars. PDOT gets money from different entities to provide design and engineers. We will provide more specifics on the “other contracts” piece.
Questions and comments on
budgetary process:
• More info needed on on labor, materials, services;
• Maintenance costs – efficiencies may be gained via outsourcing;
• More info needed on contracts with PDC and others;
• Program budget relationship to this PDOT budget review should be shown;
• Observations / concerns: $1 maintenance / $1 planning: inefficiency; more on maintenance? Used to be $2 maintenance to $1 planning;
• Big increase in maintenance costs can be expected;
• How do we compare on capital improvement investment in transport with other communities?;
• Citywide issues reflected in this budget need to be understood;
• Does the Task Force want to discuss labor costs at this table, or are you doing a different budgetary process to address this issue?;
• PDOT has labor cost detail, but this process is aimed more at the programmatic and individual areas;
• In this first program, the Task Force will focus on existing activities; then we’ll look at the broader spectrum. There is the issue of sustaining the existing infrastructure, and also a demand for new things;
• From a labor efficiency standpoint, a lot of PDOT’s budget is maintenance, down time, up time, etc. The city has tried to identify those activities which are done in the private sector, and make sure it is maximizing efficiency in that regard;
• Does PDC pay maintenance in urban renewal? Response from Sue Keil: No – capital costs only;
• For every dollar spent on maintenance, there is a dollar spent on planning. I don’t know how PDOT can have a budget crisis if it has a 9% increase in personnel, the most expensive part of its budget. Response from Sue Keil: That reflects a change in how personnel are counted; limited-term positions and part-time positions were not counted in previous years. In reality, PDOT has seen relatively flat employment growth;
• PDOT is 1-to-1 instead of 2-to-1 in terms of maintenance and planning;
• PDOT is planning for more things, including water quality planning, endangered species response, and a variety of other regulations to respond to;
• Water quality, endangered species, etc. have been around for a long time. Portland spends a disproportionate amount of money on dreaming and planning, instead of actually putting concrete on the ground;
• The city now spends $48 million in planning, where 7 years ago we were spending $20. This is a question about the cultural issue in city government. Response from Sam Adams: There are city-wide issues that will come up through this budget process. When you add up all the positions in the city categorized as planners, it looks like a lot. It’s a good question, we’ll dig into it;
• In regards to the capital improvement program, where does Portland rank in terms of other cities of this size? Response from Roger Byrne: Our rule is to never look at benchmarks until you understand how they are done. We want to look at the effectiveness of the city’s capital improvement program. Getting the best bang for the buck out of this agency is about efficiency;
Key Issues Facing PDOT: Task Force Discussion
• Recognize the whole system, including modal programs: pedestrian and bicycle. I’m afraid that when you look at efficiency, the coordinators for these programs won’t show up as a benefit. They are champions for those modes – don’t underestimate their value;
• Put the “multi” back in “multi-modal”. Include freight, automobile, and other modes;
• Break out Portland share of the regional transportation picture. There are many other players in this. When a person gets in a car, they drive through several systems. Portland shouldn’t get the blame for everything – freeway traffic, signals, etc. Budget sessions are always about “what do we cut?”;
• Portland’s place in the state-federal system. PDOT doesn’t control all decisions in Portland, but the discussion will also include the state and federal agenda;
• Perception that there is a general lack of resources vs. reality of high investment in certain parts of the community. I expect there may be a public perception issue regarding the lack of resources. But as I drive around, I observe a number of sidewalk and street improvements – this gives an impression that there are lots of resources. New streets are going into the south waterfront and the Pearl – there must be money somewhere. It is PDOT’s responsibility to maintain the integrity of the entire system. For instance, you might make choices in particular segments that impact the larger system in a negative way;
• Allocation questions: as a community, are we allocating our tax dollars appropriately? Ask some hard questions;
• Information/awareness challenge: give clear, detailed picture of investments – how, why; transparency. The challenge in going out to the public is describing where the money is coming from. In order to be truly helpful, there needs to be a better understanding of what the ramifications of our spending are.
Added comment:
• As each piece of data becomes available, you go back to your stakeholders with what you have learned;
• When we hold a Public Forum next year, will the perception issues have changed, will we have increased efficiency?;
• Deal with people’s misperceptions upfront – this is what I hear, and here’s how things really are;
• The consultants have identified several activities, and now city staff groups are responding to questions about cuts in those activities and programs – this information will be available at the January Task Force meeting;
• There is a necessary educational component to this process. People don’t understand how many years a slurry seal adds to a road, for instance;
• A Public Forum will be held on December 13th which presents an opportunity for the public to ask questions. We will register priorities, and then probe those priorities more deeply;
• Task Force members are encouraged to invite people to the Public Forum;
Questions for the Forum: Task Force Discussion
• Freight: how important is the movement of goods and services to you in the community? It’s about what’s in the trailers and how it gets to where it needs to go;
• When it comes to freight transportation, in asking the public about goods and services, if the question is tied to congestion, you will get a different answer. Another way to approach freight question: do you want companies like Intel and Nike to decide to stay in our region?;
• Tradeoffs: for a $100 investment, how would you divide among the options? If you have a choice between slurry seal (for instance) and new roads – how do you spend the money?;
• Congestion study: The freight community is just now beginning to have its voice. The congestion study that was released this morning at JPAC is the beginning of an education process that I think the entire community would benefit from. I have some concerns on how much we will rely on this process. Sometimes these processes of public outreach for perceptions get a little carried away, when you need to make good substantive decisions based on facts.
Added comment:
• The Public Forum will be part of the advisory process for Commissioner Adams and PDOT. The Task Force is a pretty balanced group in terms of interest, and will offer sound advice. (Commissioner Adams);
• Tradeoffs: How useful is it to ask “which are most important” of the modes. Does that mean you’re going to cut the bike program if it comes out last? Is it possible to come up with some scenarios, such as: we can defer maintenance for one year. Could you lower the level of service for a year or longer? How can the public see some tradeoffs and look at options that have some professional judgment applied to it?
• A subcommittee was formed to help develop questions for the Public Forum: Cam Gilmour, Corky Collier, Dan Yates, Bonnie McKnight, Olivia Clark, Jason Tell, Chris Smith, Evan Manvel, Ann Gardner, John Wheeler, and Jim Laubenthal.
7. Next Steps
The next Task Force Meeting is scheduled for January 10, 2006. PDOT will hold its Public Forum on Tuesday, December 13, 2005, at the World Trade Center, Plaza Conference Room, 121 S.W. Salmon Street, Portland, at 5:30 p.m.
Meeting summary prepared by Michele Neary, Barney & Worth, Inc.
Posted by Sam Adams on December 7, 2005
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Comments by site visitors
Absolutley, nobody can misplace a few billion dollars more efficiently than Haliburton. Maybe a joint effort between them and Enron/PGE?
Posted by: doretta | Dec 9, 2005 11:54:43 AM
The great advantage of the private sector is that employees cannot vote upper management out of office!
PDOT...use flexible funds for 1)maintenance...prioritized by function...arterial, transit street, bike network, etc....drop leaf pickup.
2) to match funds from other sources...PDC, ODOT, MTIP, LIDs, State Bridge bonds, etc.
3) put more resources into Options Division in order to get more efficient use of existing systems. Both TravelSmart on Interstate and SE Hub demonstrated significant shifts from auto trips to other modes...saving roads, improving air quality, reducing congestion and saving energy.
Posted by: Lenny Anderson | Dec 9, 2005 12:03:37 PM
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I think we should do what a true penny-saving, efficient business would do:
outsource PDOT.
We could probably get a good deal with a streamlined, efficient commpany such as Haliburton to run the portland transportation department. First thing they would do is dramatically reduce spending for personnel and administrative costs.
It's what any true businessman should advocate for - flexible, innovative solutions.
Not to say government can never achieve this. Interestingly, however, Trimet recently partnered with google to provide google transit, in part because of Trimet's technological adeptness and flexibility.
Posted by: Bob Duram | Dec 9, 2005 9:42:16 AM