METROLINK: A GOOD INVESTMENT

Transcription

1 METROLINK: A GOOD INVESTMENT BOARD OF DIRECTORS WORKSHOP JULY 27, 2018

2 AGENDA Welcome I. Panel discussion II. III. Strong foundation for investment Improving on the investment Short-term initiatives IV. Improving on the investment Long-term initiatives V. Sustaining the investment 2

3 PANEL DISCUSSION Arthur T. Leahy, Chief Executive Officer, Metrolink Kome Ajise, Director, Planning & Programs, Southern California Associated Government Chad Edison, Deputy Secretary, Transportation, California State Transportation Agency 3

4 STRONG FOUNDATION FOR INVESTMENT METROLINK IS A GOOD VALUE FOR THE INVESTMENT Strategic Goals: Ensure a Safe Operating Environment Invest in People and Assets Increase Regional Mobility

5 MISSION AND VISION To provide safe, efficient, dependable, and on-time transportation service that offers outstanding customer experience and enhances quality of life. To be Southern California's preferred transportation system built upon safety, reliability, customer service, leading-edge technology, and seamless connectivity. 5

6 FOCUS ON SAFETY Passenger safety enhancements o Positive Train Control o Inward and outward cameras o Crash energy management cars Update of System Safety Program Plan Development of Emergency Management Plan Buildout of Security Operations Center Training for employees, contractors, and partners Building relationships with local, state, and Federal law enforcement 6

7 METROLINK IS THE ONLY PROVIDER TO RELIEVE THE REGIONAL FREEWAY SYSTEM 7

8 METROLINK RIDERS TAKE LONG TRIPS ACROSS THE REGION 8 8

9 METROLINK IS THE 2 ND BUSIEST CARRIER IN THE REGION 9

10 FIXED CAPACITY FREEWAYS 10

11 HIGH FAREBOX RETURN 11

12 12

13 13

14 CONCLUSION Metrolink is a good value Actual net cost to Counties is much less than apparent cost Metrolink is the least expensive way to relieve Southern California's freeways 14

15 STRONG FOUNDATION FOR INVESTMENT HOLDING THE LINE SUCCESS AT KEEPING COSTS / BUDGET INCREASES STABLE Strategic Goal: Maintain Fiscal Sustainability

16 OPERATING REVENUE TOTAL $ Millions FY17 Actuals FY18 Estimated FY19 Budget FY20 Forecast FY21 Forecast Farebox Dispatching MOW Others 16

17 OPERATING EXPENDITURES CPI Los Angeles Area $ Millions FY17 Actuals FY18 Estimated FY19 Budget FY20 Forecast FY21 Forecast Ops Expenditures BNSF Leased Expenses Board directed new initiatives CPI line represents FY17 actuals adjusted by annual CPI growth in Los Angeles area as follows 2018 = 4.1%; 2019 = 4.0%; 2020 = 3.7%; 2021 = 3.6% 17

18 BIG 5 VENDORS TOTAL CPI Los Angeles Area $ Millions FY17 Actuals FY18 Estimated FY19 Budget FY20 Forecast FY21 Forecast Amtrak Bombardier Mass Electric (MECC) Sheriff Veolia (VTMI) CPI line represents FY17 actuals adjusted by annual CPI growth in Los Angeles area as follows 2018 = 4.1%; 2019 = 4.0%; 2020 = 3.7%; 2021 = 3.6% 18

19 OPERATING SUBSIDY BY MEMBER AGENCY TOTAL $ Millions FY17 Budget FY18 Budget FY19 Budget FY20 Forecast FY21 Forecast METRO OCTA RCTC SBCTA VCTC 19

20 STRONG FOUNDATION FOR INVESTMENT DELIVERING ON THE REHABILITATION PROGRAM Strategic Goals: Ensure a Safe Operating Environment Invest in People and Assets

21 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 - REHABILITATION PROGRAM Accelerated Rate of Project Delivery 19M 26M 23M 39M* FY2015 FY2016 FY2017 FY2018 *Estimated rehab expenditures by fiscal year and year of adoption; Final FY18 expenditures are expected to increase upon completion of year-end process Year of Adoption: Prior Years SOGR Reprogrammed Average (3 Prior Years) 21

22 REHABILITATION ACCOMPLISHMENTS Rail Installation - San Clemente Culvert Replacement Valley Subdivision 22 Rehabilitated Crossing - Ventura Sub Platform 2 Canopy Los Angeles Union Station 22

23 IMPROVING ON THE INVESTMENT SHORT TERM INITIATIVES FARE PROMOTIONS Strategic Goal: Retain and Grow Ridership

24 ANTELOPE VALLEY PROMOTION (ACTUALS) $9.7M $9.7M $9.5M $9.6M $9.5M $9.3M $9.6M $9.3M $9.1M $8.9M $9.1M $9.1M $8.9M $8.7M $8.7M $8.7M $8.5M FY16 FY17 FY18 Revenue Goal Subsidy $8.5M 24

25 PERRIS VALLEY PROMOTION (ACTUALS) $1.4M $1.2M $1.0M $0.8M $0.6M $0.4M $1.1M $1.2M $0.2M $0.0M $0.1M FY16 FY17 FY18 Revenue 25

26 SAN BERNARDINO PROMOTION (PROJECTIONS) $21.5M $21.5M $20.5M $19.5M $20.4M $19.9M $20.7M $20.5M $19.5M $18.5M $19.1M $18.5M $17.5M $16.5M $17.2M $18.4M $17.5M $16.5M $15.5M FY19 FY20 FY21 FY22 FY23 Discounted Revenue (Net of Program Expense) Pre-Discount Revenue $15.5M 26

27 IMPROVING ON THE INVESTMENT SHORT TERM INITIATIVES MARKETING INITIATIVES Strategic Goal: Retain and Grow Ridership

28 MARKETING Objective: Increase ridership Increase revenue by $2.8M Strategy: Customized marketing by line to grow ridership Tactics: Line-specific media (billboards, digital, direct mail, print) with system-wide programs (loyalty, rideshare, affinity, paid search) Measurement/Tracking: Tracking revenue and ridership by line / monitor media through trial ride redemptions and effectiveness of the tactics 28

29 CORPORATE PASS PROGRAM (SALES) Objective: Increase revenue by $500,000 Strategy: Attract new riders / retain existing riders / recapture former riders Tactics: 25% Discount marketing campaign / CQC- Mobile app integration / Increased Sales Focus / Refresh branding / Creative/Train 682 schedule shift Measurement/Tracking: Monitoring 25% program sign ups / mobile app adoption rate / expansion of program with existing clients

30 Measurement/Tracking: Reduction of customer complaints / Churn rate reduction / Train Tracker (map view) onto website home page / Customer self-service / Website personalization 30 CUSTOMER RETENTION Objective: Increase retention by 1% (over $750K in revenue) Strategy: Improved customer service / improved communication / loyalty program, etc. Tactics: Staff assigned to field stations during AM/PM peak and dispatched to bus bridge stations during service disruptions / More frequent service tweets / Timely response to customer service tweets / Highlight train tracker / Revised QSP to provide compensation and transportation reimbursements for most delays of 1hr +

31 IMPROVING ON THE INVESTMENT SHORT TERM INITIATIVES INCIDENT PREVENTION AND RESPONSE Strategic Goals: Ensure a Safe Operating Environment Retain and Grow Ridership

32 INCIDENT PREVENTION AND RESPONSE Board approved plan to reduce incidents that occur on ROW and associated delays Implemented customer service policy modifications Metro has increased funding to target high risk areas with more frequent clean-ups, additional enforcement and more outreach Board requested plan on coordinating with communities prior to sweeps Staff will provide update in September 32

33 IMPROVING ON THE INVESTMENT SHORT TERM INITIATIVES METROLINK REHABILITATION PLAN Strategic Goal: Invest in People and Assets

34 METROLINK REHABILITATION PLAN ASSET TYPES TRACK STRUCTURES SYSTEMS MOW EQUIP & VEHICLES ROLLING STOCK FACILITIES 34

35 IMPROVING ON THE INVESTMENT SHORT TERM INITIATIVES SERVICE IMPROVEMENTS Strategic Goal: Increase Regional Mobility

36 SERVICE IMPROVEMENTS Service Reliability Improvement Plan Achieve on-time performance goal of 95%. On-time performance is currently 93% Achieve positive train control interoperability goal of 99% by December 31, 2018 Reduce mechanical delays to less than 15 per month Double tracking improves reliability Near-Term Schedule Improvement Initiatives Additional Burbank Airport Trains and headway balancing SB Line Bring back express and add trips for hourly bidirectional off-peak service Weekend service improvements LOSSAN Corridor optimization South: OC, 91/PV, IEOC Lines North: VC, AV Lines 36

37 IMPROVING ON THE INVESTMENT LONG TERM INITIATIVES SCORE PROGRAM Strategic Goal: Increase Regional Mobility Maintain Fiscal Sustainability

38 METROLINK STRATEGIC PLAN (2015) EMPHASIS ON IMPROVING RELIABILITY / CAPACITY DOUBLE TRACK 38 38

39 CALIFORNIA STATE RAIL PLAN (2018) 39

40 SCORE GUIDING PRINCIPLES Service is: Regular service at regular intervals (e.g., every hour, every 30 minutes) Repeating service repeats at the same times every hour Pulsed line schedules are synchronized to facilitate transfers Bi-directional relatively balanced in both directions to serve multiple destination points Reliable scheduled times can be reliably met at all stations For the customer, the service product is: Intuitive Easy to use Attractive For the system: Operating efficiencies Lower cost structures 40

41 2028 Vision Antelope Valley Santa Clarita San Fernando Valley San Gabriel Valley San Bernardino Redlands LOSSAN Pomona Valley Ontario Riverside KEY at least 8 trains per hour at least 4 trains per hour at least 2 trains per hour at least 1 trains per hour Express Overlay / LOSSAN (1 per hour) To Be Determined Irvine Laguna Niguel Orange Corona Oceanside Perris San Clemente LOSSAN 41

42 SCORE PHASE 1 TIRCP 2018 Santa Clarita Antelope Valley 2023 CAPACITY San Fernando Valley San Gabriel Valley San Bernardino Redlands LOSSAN Pomona Valley Ontario Riverside KEY 2 trains per hour (peak period, peak direction) at least 1 train per hour Improved frequency / speed / timing Express Overlay (peak) or LOSSAN (up to 1 per hour) As Frequent as Current Schedule Irvine Laguna Niguel Orange Corona Oceanside Perris San Clemente LOSSAN 42

43 METROLINK PROPOSED INITIAL SCORE PROJECT LIST ($M) (subject to future updates) SCORE INITIAL PROJECTS Service Wave 1, Enables 30-Min Service Pattern Marengo Siding Improvements Between LAUS and Cal State LA Station El Monte Station Improvements At El Monte Station Simi Valley Double Track At Simi Valley Station Burbank Jct Speed Improv Near Burbank Station Signals in Orange County Near Anaheim Cyn and Orange Stations Signals: Burbank-LA Between Burbank Station and LAUS Riverside-Downtown Station Improvements At Riverside-Downtown Station County Where Project is Located Los Angeles Los Angeles Ventura Los Angeles Orange Los Angeles Riverside SB SB Line (s) VC, PacSurf AV, VC, PacSurf OC, IEOC AV, VC RV, 91/PV, IEOC Los Angeles o o Orange Riverside San Bernardino o o Ventura o o o o o o o o o o o o o o o o Estimated Project Cost YOE ($M) $9.68 $9.68 $22.16 $22.16 $69.50 $67.50 $2.00 $17.95 $17.95 $1.06 $1.06 $8.22 $8.22 $26.49 $14.49 $12.00 Service Wave 2, 30-Min Service Improvement Projects Rancho Cucamonga Siding or Similar Project San Bernardino SB o o $46.58 $46.58 Chatsworth Station Improvements Los Angeles VC, PacSurf o o $25.16 $25.16 Irvine Station Improvements Orange OC, IEOC, PacSurf o o o o o $61.39 $61.39 Signals in OC (Avery - SONGS) Orange, San Diego OC, IEOC, PacSurf o o o o o In vicinty of City of Laguna Niguel and Camp Pendelton $6.50 $6.50 Capacity Improvements South OC (e.g. Serra to SONGS) Orange, San Diego OC, IEOC, PacSurf o o o o o In vincity of City of Dana Point and Camp Pendleton $18.75 $18.75 Complex Systemwide Complementary Projects County Experiencing Service Benefit TIRCP / State Reprogammed Funds High Sped Rail Funding Sources ($M) Federal Formula (FTA 5307) State Formula (STA/SRA/Other) Local Measures Other/TBD Link US Early Operational Phase Los Angeles All o o o o o $ $ $ $23.55 $64.95 $40.18 Supplemental Fleet All All Orange County Maint. Facility Phase 1 In Irvine Improvements LA-Fullerton Trunk Early starts on Commerce Station relocation and Fullerton Orange Los Angeles, Orange OC, IEOC OC, 91/PV, PacSurf o o o o o o o o o o o o o o $38.33 $38.33 $58.34 $58.34 Studies and Other LA, Orange, OC, 91/PV, o o o o o Environmental Clearance of Additional Projects on BNSF Riverside, San Bern PacSurf $6.00 $6.00 Integration Studies All All o o o o o $4.00 $4.00 $ $ $30.00 TOTAL COST OF PROJECTS $1,532.5 $936.5 $423.3 $12.0 $25.6 $64.9 $70.2 * PacSurf = Amtrak Pacific Surfliner (LOSSAN) ($875.7 M TIRCP $60.8 M TBD) 43 43

44 LINK UNION STATION (LINK US) Largest funded element of SCORE Phase 1 TIRCP grant Transforms service offerings: new, frequent through service north to south Implementation State requirements through an Award Agreement FRA is intending to assign NEPA clearance to State of California (California High Speed Rail Authority CHSRA) New Executive Steering Committee, comprised of CEOs: Metro CHSRA Authority CalSTA The Authority is reviewing operational planning concepts and design elements 44

45 SCORE PHASE 1 EXPENDITURE ESTIMATES Thousands $180,000 $160,000 $140,000 $120,000 $100,000 $80,000 $60,000 $40,000 $20,000 $- FY19 FY20 FY21 FY22 FY23 FY24 Most projects in Environmental stage / early Most projects in Construction stage Most projects in Transition / Close stage 45

46 ELEMENTS OF SCORE FOR FUTURE FUNDING PURSUITS Quiet Zones Extra Track and Sidings for Greater Frequency and Reliability Maintenance Facilities Fleet Electrification Grade Separations Rehabilitation / State of Good Repair 46

47 IMPROVING ON THE INVESTMENT LONG TERM INITIATIVES STATE OF GOOD REPAIR Strategic Goals: Ensure a Safe Operating Environment Invest in People and Assets

48 WHEN REHABILITATION FUNDING IS DEFERRED Deterioration of components will compound Additional Increase in Backlog Major components will fail to operate reliably Slow Orders Increase Operating and Capital Cost Increase Risk of Accidents Rise Passenger services delayed Ridership Declines 48 48

49 OVERALL SYSTEM STATE OF GOOD REPAIR COSTS Asset Classes Backlog (Immediate Need) State of Good Repair (Average Annual Need) Special Projects (Rolling Stock) 25-Year Total (with Escalation) Track $109.6M $28.7M $0.0M $1,724.8M Structures $125.1M $8.8M $0.0M $681.9M Systems $98.4M $17.9M $0.0M $989.4M MOW Equipment and Vehicles $16.5M $2.5M $0.0M $107.3M Rolling Stock $87.7M $24.0M $417.4M $1,471.3M Facilities $6.2M $2.6M $0.0M $102.5M Total $443.5M $84.6M $417.4M $5,077.2M 49

50 ADDRESSING THE STATE OF GOOD REPAIR BACKLOG $600M Backlog Cleared in 6 Years (With Escalation) $500M $400M $300M $200M $100M $M FY18-19 FY19-20 FY20-21 FY21-22 FY22-23 FY23-24 FY24-25 FY25-26 FY26-27 FY27-28 SOGR Backlog Special Projects (Rolling Stock) Backlog Construction Remaining *FY19 reflects actual approved rehabilitation funding as of July 13, 2018 Board Meeting in the amount of $62.8M for FY19 Capital Program - Rehabilitation and $62.0M for FY19 Capital Program - Special Projects. This number is close to

51 MEMBER AGENCY BREAKDOWN Agency Backlog (Immediate Need) no escalation State Of Good Repair (Average Annual Need) no escalation Next 6 Year Total & Special Projects with Escalation* RCTC 6.6% VCTC 7.2% METRO $260.1M $44.8M $344.1M OCTA $61.8M $17.6M $131.7M SBCTA $65.8M $10.5M $80.3M RCTC $16.7M $5.9M $42.6M VCTC $39.2M $5.6M $46.4M Total $443.5M $84.6M $645.1M SBCTA 12.5% OCTA 20.4% METRO 53.3% *Costs to eliminate 6-Year backlog (FY19-20 to FY24-25) and distributed based on representative % of the 25-Year Escalated Total BACKLOG Immediate Need $443.5M STATE OF GOOD REPAIR Average Annual Need $84.6M 51

52 Programmatic Funding & Planning Approach Member Agency Funding Innovative Financing Achieve State of Good Repair by 2028 Programming first, prioritization of projects/ location second Economies of scale Single year vs. Multi-year commitment Draw down backlog over 6 years Grants Other Funding Sources Loans 52

53 * Expenditure estimates are based on available data / assumptions and are subject to change Current Average Expenditures represents the average expenditures per Fiscal Year for Rehab and New Capital projects over the past 4 years. Expenditures for FY18 was scaled up based on results after 3 quarters. Millions SCORE and MRP Expenditure Estimates* (with Escalation) $400 $350 $300 $250 $200 $150 Initial estimates suggest that SCORE and MRP expenditures would be approximately 6 times the current average $100 $50 $- FY17 FY18 (Est.) FY19 FY20 FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28 Prior Years Current Portfolio SOGR Backlog Special Projects (Rolling Stock) SCORE (Phase 1)

54 Managing SCORE / MRP and Required Changes The Authority is following a multifaceted approach to prepare for and manage SCORE / MRP programs COORDINATE & COLLABORATE ADAPT IMPLEMENT EXPLORE RESOURCE CONTROL Working with Member Agencies and Other Key Stakeholders Adjusting Project Management Structure, Methodology, Processes and Support Levels Implementing a Program Management Model for SCORE and Potentially MRP Projects Assessing Other Procurement Vehicles such as Design Build and Construction Management / General Contractor (CM/GC) Assessing the Resources Requirements Across the Authority, including Staffing Increased Monitoring and Metrics for Successful Project Delivery 54

55 IMPROVING ON THE INVESTMENT LONG TERM INITIATIVES ORGANIZATIONAL READINESS AND STAFFING NEEDS Strategic Goal: Invest in People and Assets

56 ORGANIZATIONAL READINESS AND STAFFING NEEDS Maintain competitiveness by being employer of choice Enhance and promote managerial and supervisory training programs Continue to build on succession planning efforts to help groom our next generation leaders Conduct staffing assessment to support SCORE and MRP 56

57 SCORE Program Organizational Readiness Plan Status Report First Draft of Potential Staffing Needs from Department Heads (Note: Evaluation of Cross-Departmental Duplication, Grant Funding Eligibility, and State-of-the-Art Practices, and Affordability are in Process.) Department Executive Office, Audit, and Legal Human Resources and Contracts Full-time Employee (FTE) FY19 FTE FY20 FTE FY21 FTE FY22 FTE FY23 FTE FY Finance Planning, Engineering, Project Management Office, Operations Community Relations & Government Affairs N.A Total N.A. = Not available as Engineering is for peak need only and an annual needs analysis is pending. 57

58 58 NEXT STEPS Task Date Complete final staff assessment matrix July 31 Compare with best practices with other like-sized regional commuter rail agencies Develop improvement strategies and plan with roles and responsibilities and timeframes August 10 August 31 Develop implementation plan September 7

59 IMPROVING ON THE INVESTMENT LONG TERM INITIATIVES CONTRACT BUNDLING Strategic Goals: Ensure a Safe Operating Environment Maintain Fiscal Sustainability

60 CONTRACT BUNDLING Board direction to pursue fully bundled contract for rail operations and maintenance functions Staff has begun developing: Scope of Work Key Performance Indicators / Contract Incentives Contract Cost Estimate Procurement, Contract Execution, and Mobilization/Transition Schedule Disadvantaged Business Enterprise Requirements Preliminary timeline Issue solicitation First quarter 2019 Contract award Late 2019 Transition period Late 2019 through mid

61 SUSTAINING THE INVESTMENT FUTURE FUNDING AND FINANCING OPTIONS Strategic Goal: Maintain Fiscal Sustainability

62 SCORE IS WORTH OUR EFFORTS 62

63 SCORE PROGRAM COST SUMMARY BY PHASE (Year of Expenditure [YOE] $000) "EARLY" PROJECTS - DELIVERED BY 2023 (YOE $000) SCORE Program Project Element Estimated Cost Line Capacity Enhancements $2,788,757 Link Union Station (Link US) $950,398 Fleet Modernization $38,327 Enhanced Line Reliability $458,140 Maintenance Facility Restructuring $410,615 Grade Separation and Safety $143,700 Complementary System Enhancements $14,570 MID-TERM" PROJECTS - DELIVERED BY 2028 (YOE $000) SCORE Program Project Element Estimated Cost Line Capacity Enhancements $2,088,717 Link Union Station (Link US) $1,145,000 Fleet Modernization $1,215,036 Enhanced Line Reliability $0 Maintenance Facility Restructuring $613,726 Grade Separation and Safety $258,279 Complementary System Enhancements $0 SCORE Program Total Estimated Cost $10,125,264 63

64 FEDERAL FUNDS LEVERAGING STRATEGY UNDERWAY USE THESE STATE & LOCAL FUNDS TO MATCH COMPLETED IN PROCESS These State funded inputs to our model make the leveraging process possible THESE FEDERAL FUNDS BUILD PROGRAM (FORMERLY TIGER) APPLICATION SUBMITTED IN JULY INFRA (FREIGHT AND HIGHWAYS) PROGRAM CORE CAPACITY PROGRAM APPLICATION SUBMITTAL IN NOVEMBER PROJECT DEFINITION UNDERWAY BASELINE FINANCIAL MODEL MODEL CONCEPT COMPLETE SUPPORTING DATA COLLECTION ANALYSIS AND SUBMITTAL TO FTA PENDING 64

65 CREATING A SUSTAINABLE FUNDING STRATEGY Baseline Model to Support FTA Requests Baseline shows what we can afford in context Consistent and reasonable assumptions required for FTA process Scenario 1: SCORE Funding Above Baseline Discuss funding strategies with funding partners Identify gap/shortfalls not met by funding partners Future Scenarios: Identify a gap/shortfalls funding strategy Make smaller assumptions/adjustments to minimize the gap Right-size the big picture solution for the smaller forecasted funding gap Sustained strategies Model emerging strategies to inform legislative supporters on emerging issues 65

66 Previously Evaluated Funding and Financing Tools Funding Source Evaluated Multi-County Sales Tax (2 nd study at zip code level) Enhanced Infrastructure Financing District Special Assessment District & Mello-Roos Community Facilities District Transit Oriented Commercial Property Development/Joint Development Toll and Managed Lane Revenue Transient Occupancy Tax, Vehicle Licensing Fee, & Payroll Transit Tax Credit/Debit Card Transactional Tax at Point of Sale Fuel Station Shipping Container Fee Transportation Network Company Fee/Trip Parcel Tax & Assessed Property Valuation Financing Mechanisms Evaluated RRIF Loan & TIFIA Loans California Infrastructure State Revolving Fund Program P-3 Partnerships Sperry Report (Month/Year) 1/16 3/16 7/17 1/18 EB- 5 Lending 66 Added Zip Cs.

67 RECAP AND CONCLUDING REMARKS

68