Every organization has assets it should protect. Assets come in the form of workers, cash and investments, and physical assets. Capital Metro has significant physical assets: administrative offices for authority personnel, "passenger amenities," including park-and-ride facilities, bus stops, and transfer centers; and operational facilities such as vehicle repair facilities, fueling and vehicle washing facilities, and bus yards. In addition, Capital Metro owns 162 miles of railroad and related facilities and equipment.
Capital Metro's management of its physical assets is disjointed, disorganized, and results in duplicative effort. TPR's review found major problems throughout the authority's various facility operations, including a lack of accountability, poor decision-making, poor record-keeping, poor allocation of facilities staff, disregard for standard and appropriate business practices, and an absence of planning for managing and improving its physical assets.
This chapter examines Capital Metro's facility operations from the standpoints of planning, accountability, decision-making, and organization.
Between 1991 and 1996, Capital Metro's Facilities, Maintenance, and Construction Department administered a substantial construction program devoted to passenger amenities such as transfer centers, park-and-ride facilities, and bus stop shelters, benches, and litter cans.1
In 1996, the authority reorganized and spread its facility functions throughout the organization. Today, Capital Metro has three facility-related departments and two facility-related sections divided between its Operations and Administration Divisions (Exhibit 25).
Department and Section
|Facilities Design and
|Facilities Design and Construction Dept.||Administration|
|Building Maintenance Section||Maintenance Dept.||Operations|
|Public Facilities Maintenance Section||Maintenance Dept.||Operations|
|Railroad Right-of-Way Dept.||Railroad Right-of-Way Dept.||Administration|
|Rail Capital Project Dept.||Rail Capital Project Dept.||Administration|
Source: Capital Metro.
The Facilities Design and Construction (FDC) Department, created in 1996, is responsible for the remodeling and renovation of administrative offices and operational facilities and the construction of park-and-ride and bus transfer facilities. The department also manages the construction of some bus shelters, although these more typically are the responsibility of the Public Facilities Maintenance Section in the Operations Division's Maintenance Department. FDC also manages construction in "Build Greater Austin" projects, which are designed to improve the infrastructure along Capital Metro routes; these improvements can include street repairs, the construction of sidewalks, and similar projects.
The Building Maintenance Section of the Maintenance Department is responsible for installation, repairs, and maintenance of industrial machinery, equipment, monitoring systems, physical structures, electrical control systems, and all piping at the main Capital Metro location at 2910 East Fifth Street. The section also performs painting, carpentry, electrical and plumbing repairs, and inspections and preventive maintenance on all Capital Metro buildings and equipment. The section also manages the authority's service and repair contracts for major equipment such as air conditioning and heating units. Building Maintenance also has handled minor construction projects such as the building of a canopy to protect scrap materials. The supervisor of this section also supervises Capital Metro's body shop, upholstery shop, and wheelchair lift installation team.
The Maintenance Department's Public Facilities Maintenance Section installs and maintains passenger amenities such as bus shelters, benches, and trash cans. The section changes bus stop signs concerning bus routes as needed and maintains the Braille signs at bus stops. According to Capital Metro, over the past eight years this section has spent a total of nearly $6.3 million on benches (1,079 for almost $3.1 million), bus stop shelters (636 for $2.6 million), and litter cans (1,442 for about $659,000).
The Railroad Right-of-Way Department manages the authority's 162 miles of railroad line running from Giddings to Llano, including tracks, track support structures, and other features; in practical terms, this consists of overseeing the authority's relationship with its contractor, Longhorn Railway Company, and managing the leases and licenses connected with the railroad line's right of way.
The Rail Capital Project Department, currently unstaffed, is expected to handle the planning and other developmental activities associated with fixed guideway (light rail, heavy commuter rail, high-occupancy vehicle lanes) activities, if and when they are approved by the voters.
Exhibit 26 illustrates current staffing levels for each of these departments and sections.
|Facilities Design & Construction||Building Maintenance||Public Facilities Maintenance||Railroad Right-Of-Way||Proposed Rail Capital Project|
|Coordinator (1)||Supervisor (1)||Manager (1)||Mgr./Engineer (Proposed-1)|
|Admin. Staff (1)||Bldg. Maint. Lead (1)||Lead Facilities Installer (1)||Real Estate Specialist (1)||Civil Engineer (Proposed-1)|
|Constr. Project Mgr. (Capital Metro Projects)
|Bldg. Maint. Tech. 1st Class
|Facilities Installers (10)||Property Agent (1)||Office Manager (Proposed-1)|
|Constr. Project Mgr. (Build Greater Austin) (1)||Two Bldg. Maint. Tech. 2nd Class (2)||Construction Coordinator (1)|
|Bldg. Maint. Tech. 3rd Class (4)|
|Building Maint. Attend.(1)|
Source: Capital Metro as of April 1998.
The combined 1998 operating budgets for these departments and sections total nearly $3.4 million. Exhibit 27 compares the operating budgets of these departments and sections for fiscal 1997 and 1998.
|Facilities Design & Construction||Building Maintenance||Public Facilities Maintenance||Railroad Right of Way & Rail Capital Project|
|Budget Category||Actual FY 97||Budget FY 98||Actual FY 97||Budget FY 98||Actual FY 97||Budget FY 98||Actual FY 97||Budget FY 98|
|Salaries and Benefits||$348,027||$ 347,372||$ 478,593||$ 490,367||$461,944||$375,989||$ 25,399||$ 158,734|
|Professional Fees and Contracts||211,996||58,750||112,432||131,300||0||0||932,125||233,000|
Source: Capital Metro.
The major shift in the FDC Department's "Other Expenses" category between fiscal 1997 and 1998 was due to the fact that two items from the budget of a Property Acquisition Management Department, since disbanded, were shifted to FDC's in 1998. One of these was $173,000 for "Lease-Unmanned Shelter/Land," essentially what Capital Metro pays for the use of its leased park-and-ride facilities. The other, $234,000 for "Building and Structure and Paved Surface," actually represents annual lease payments for Capital Metro's office building at 801 Congress (approximately $140,000) and its Pflugerville Bus Yard (approximately $94,000). TPR asked why this item was so confusingly named, but the manager of FDC could not provide an answer.
The other major variance, in the railroad operation's spending on professional fees and contracts, reflects four significant contracts let in 1997. The largest, with Daniel, Mann, Johnson, and Mendenhall for $824,000 (subsequent amendments to the contract increased this amount to $959,795), was for design and preliminary engineering work for a bus terminal and a rail line to the new Bergstrom International Airport. The other three contracts were for engineering and consulting services related to Capital Metro's railroad operations and light rail plans. These items were funded through an operating budget fund called "Other Professional Fees - Future Transit System."
Capital Metro's railroad operation reports only $95,000 in professional fees in its 1998 budget. However, other parts of the Capital Metro budget-"1998 Projected Fixed Guideway Expenditures" and "1998 Projected Giddings/Llano Acquisition & Safety Upgrades"-have total budgets of $3.3 million and $2.3 million respectively and are directly related to Capital Metro's railroad operations. About $3 million of the money budgeted under "1998 Projected Fixed Guideway Expenditures" will be used to obtain professional consulting connected with a preliminary engineering environmental impact statement and program management for the light rail project.
The FDC Department, Public Facilities and Building Maintenance Sections, and Railroad Right-of-Way Department have separate capital project budgets. Exhibit 28 lists these projects and their budgets for fiscal 1998.
|Facilities Design & Construction||Public Facilities Section||Building Maintenance Section||Rail Right-of-Way|
|Downtown Transit Center||$73,500||Benches (35)||$20,000||Cap Computer||$5,000||PE/EIS Consulting Contracts||$3,000,000|
|Architectural and Engineering
|$150,000||Oil Tank Upgrade||$60,000||FRA Railroad Safety Improvement: Signal & Railroad Crossing||$768,000|
|South Transit Facility||$45,000||Compressed Natural Gas engine rebuild||$15,000||FRA Railroad Safety Improvement: Track Road Bed||$476,000|
|North Transit Center - Professional Fees||$55,000||Compressed Natural Gas Facility Expansion||$100,000||FRA Railroad Safety Improvement: Street crossings||$300,000|
|Bus Shelters Construction||$240,000||Giddings/Llano ROW Purchase||$764,000|
|Leased Facilities Maintenance||$200,000|
|Leased Park & Ride Facilities||$127,000|
|Bus Shelters A/E||$14,400|
|Cedar Park Electronic Card Reader||$7,000|
|Park and Ride||$16,351|
|2910 E. 5th Exterior Security Construction||$146,000|
|2910 E 5th Operations renovation||$200,000|
* A/E: Architecture & engineering; P & R: Park and Ride.
Source: Capital Metro.
In this chapter, TPR recommends that Capital Metro expedite the completion of a comprehensive master facilities plan; strengthen its management of leases along its railroad right of way, improve Capital Metro's purchase of bus stop amenities; consolidate isolated facilities functions scattered throughout its organization into a single Facilities Division; and combine the Building Maintenance and Public Facilities Maintenance Sections. TPR also proposes that the authority eliminate certain facilities-related positions. The recommendations in this chapter would save Capital Metro $598,300 in the first year and $2,991,500 over five years.
Consolidate all facility-related operations.
Capital Metro's division of facility operations among five different organizational units-the Facilities Design and Construction (FDC) Department, Building Maintenance Section, Public Facilities Maintenance Section, Railroad Right-of-Way Department, and Rail Capital Project Department-has led to duplicated effort, confusion over responsibilities, and inappropriate staffing patterns.
One of the problems that TPR encountered during it review of these units was that three different units can and have managed construction contracts (Facilities Design and Construction, Building Maintenance, Public Facilities Maintenance). Responsi-bility for construction projects appears to be assigned more or less at random.
Before Capital Metro's March 1998 reorganization, for instance, FDC was responsible for remodeling on the first, second, and third floors of the authority's main building and in the rest rooms of the Service Islands. Similarly, the Building Maintenance Section has managed projects such as the construction of a canopy for scrap materials and remodeling of a wash facility for Capital Metro vehicles. More recently, FDC installed shelters at bus stops, which typically has been the responsibility of Public Facilities Maintenance section.
TPR also found unclear lines of responsibilities for budgets. In recent years, Public Facilities Maintenance has purchased passenger amenities (bus shelters, benches, and litter cans), but in fiscal 1998, these items were included in the FDC budget.2 Similarly, contracted janitorial services are included in the Building Maintenance Section's budget, but the service is managed by the chief of Operations. Other organizations usually attach the supervision of custodial services, whether internal or contracted, directly to a facilities-related division. The major advantage of such an approach is the fact that the supervisor who oversees day-to-day custodial activities is the most informed and appropriate person to manage the custodial budget.
A. Create a Facilities Division and move all facility-related functions into it.
This recommendation would be part of the authoritywide reorganization suggested in the Governance chapter of this report. This recommendation, along with the Facilities master plan, would help to reduce duplicated effort and maximize coordination among facilities-related groups. It also should improve Capital Metro's management of employees, construction projects, and budgets.
B. All major construction, renovation, and bus stop facilities installation projects at Capital Metro should be coordinated and managed by the Facilities Design and Construction Department.
Capital Metro should clearly assign responsibility for construction project management to Facilities Design and Construction. This assignment should be addressed and included in Capital Metro's Facilities master plan. This should reduce inconsistencies in construction project management; ensure that con-struction project managers are appropriately trained and skilled; reduce duplication of effort; and guarantee that budgets are assigned to the appropriate departments.
C. The Facilities Division manager should assign management of its contracted custodial services to the supervisor of the Facilities Maintenance Section.
This assignment, which would include responsibility both for custodial activities and the associated budget, would complement the Facilities Maintenance Section's other activities.
These recommendations would not involve a direct fiscal impact but should produce greater efficiency throughout Capital Metro's facilities operations.
Combine the Building Maintenance and Public Facilities Maintenance sections into a single Facilities Maintenance Section.
The Maintenance Department of the Operations Division is made up of sections primarily dedicated to vehicle operations and maintenance (Exhibit 29). However, it also has two facility-related sections: the Building Maintenance Section and the Public Facilities Maintenance Section.
Source: Capital Metro.
The Building Maintenance Section is responsible for the installation, repair, and maintenance of industrial machinery, equipment, monitoring systems, physical structures, electrical control systems, and all piping at all facilities at the main Capital Metro location on 5th and Pleasant Valley. Interestingly, the supervisor of Building Maintenance also is responsible for three specialty vehicle units in the department's Running Repair Section: the bus Body Shop, with a staff of seven, the Upholstery Shops, with a staff of two, and the Wheel Chair Lift team, with four employees.
The Public Facilities Maintenance Section is responsible for the installation, maintenance, and servicing of passenger amenities such as bus shelters, benches, and trash cans. They also change informational signs about bus routes at bus stops as needed and maintain Braille signs at the stops.
The present organizational scheme, in which one supervisor is responsible for Building Maintenance as well as three specialty units in Running Repair, requires this person to manage two totally different types of work-and more activity than even one highly competent supervisor can handle effectively.
The Facilities Division manager should consolidate the Building Maintenance and Public Facilities Maintenance sections into a single Facilities Maintenance Section.
The combined section would reside within the newly created Facilities Division recommended elsewhere in this report. The present Public Facilities Maintenance supervisor would supervise the new section. The current supervisor of Building Maintenance should continue to supervise the Body Shop, Upholstery Shop, and Wheel Chair Lift team.
This recommendation could be accomplished with existing employee resources.
The manager of the Facilities Design and Construction Department should complete a comprehensive master facilities plan.
Capital Metro owns or leases a number of facilities at a significant cost, yet lacks a master facilities plan to guide the management of these facilities. Facilities owned or leased by Capital Metro include administrative and operational facilities (Exhibit 30); passenger amenities such as bus stop shelters, as well as benches and litter containers (Exhibit 31); park-and-ride facilities and transfer centers (Exhibit 32); and a 162-mile railroad line running from Llano to Giddings.
|Facility||Space||Arrangement||Lease Amt. or Cost|
|Capital Metro Administration Building, Operation Facilities and Bus Depot
2910 E. 5th Street, Austin
30,000 sf Administration Bldg.
15,000 sf Maintenance Bldg.
|Owned by Capital Metro||$23,368,320|
|Capital Metro Downtown Office
801 Congress, Austin
|7,245 sf "usable area"
7,425 "rentable area"
|Leased by Capital Metro||$8,364 per mo.|
|Bus Satellite Yard
16107 IH-35, Pflugerville
|150,082-land area (3.445 acres)
4,100 sf - existing bldg.
|Leased by Capital Metro||$8,000 per mo.|
sf = square feet
Source: Capital Metro.
|Types of Bus Stop Amenities|
|Year||Number||Total Cost||Number||Tot. Cost||Number||Total Cost|
* One shelter and 76 benches constructed of wood and concrete existed prior to 1991.
Source: Capital Metro.
|Capital Metro Park and Ride and Transfer Center Facilities|
|Facility||Space||Arrangement||Lease Amt. or Cost|
|Cedar Park & Ride||6.5 acres and 600 sf building||Owned by Capital Metro||$620,000|
|Pavilion Park & Ride||7.26 acres and 450 sf building||Owned by Capital Metro||$936,000|
|North Lamar Transfer Center||5.6 acres and 1,250 Canopy||Owned by Capital Metro||$750,000|
|Oak Hill Plaza Park & Ride||unknown||Lease or Interlocal agreement||$275 per mo.|
|Barton Creek Mall Special Events Transfer Center||unknown||Lease or Interlocal agreement||$2,700 per mo.|
|Barton Springs/Bouldin P&R-Dillo||unknown||Lease or Interlocal agreement||$1 per yr.|
|Austin High School P & R||unknown||Lease or Interlocal agreement||$1 per yr.|
|Praise Tabernacle Church P & R||unknown||Lease or Interlocal agreement||$93,648 for 3 yrs.|
|Hyde Park United Methodist Church
P & R
|unknown||Lease or Interlocal agreement||$800 per mo.|
|Pflugerville Elementary P & R||unknown||Lease or Interlocal agreement||0|
|Pflugerville High P & R||unknown||Lease or Interlocal agreement||0|
|Pflugerville H.E.B. P & R||unknown||Lease or Interlocal agreement||0|
|Travis Square P & R||unknown||Lease or Interlocal agreement||0|
|Leander Church of Christ P & R||unknown||Lease or Interlocal agreement||$850|
|William Cannon/Bluff Spring Transfer Center||unknown||Oral Agreement||n/a|
|ACC Riverside Transfer Center||unknown||Oral Agreement||n/a|
|Highland Mall Transfer Center||unknown||Oral Agreement||n/a|
|Northcross Transfer Center||unknown||Oral Agreement||n/a|
|San Marcos @ Burton (in Manor)
P & R
|Burnet @ Townes (in Manor) P & R||unknown||Oral Agreement||n/a|
|Dawn @ Thunderbird P & R||unknown||Oral Agreement||n/a|
|Lago Vista P & R||unknown||Oral Agreement||n/a|
|Jonestown P & R||unknown||Oral Agreement||n/a|
Source: Capital Metro.
Since October 1997, the Facilities Design and Construction Department has been developing a master facilities plan that was to have been completed by March 1998.3 Recently, TPR was told that this deadline has been moved back to July at the earliest. This plan should be completed as soon as possible, not least because it would help Capital Metro's facility-related departments and sections prepare their fiscal 1999 budgets and their five-year Capital Projects forecast.
More importantly, however, a master facilities plan would assign clear responsibility for facility-related activities and projects, such as construction projects; eliminate duplication of effort among the Facilities Design and Construction Department, Building Maintenance Section, and Facilities Maintenance Section; aid facilities management in making crucial decisions about facility operation; document the authority's need to lease or acquire property for the development of transit facilities; address ownership, use, and management of its railroad right-of-way; allow management to determine current and future staffing needs, assign employees to jobs that match their skills and training; and would add a degree of professionalism and accountability to facility operations. Without a master facility plan, assigning accountability for facilities operations is difficult at best.
Capital Metro's lack of a master plan for its facilities often causes it to adopt a reactive approach to its facility problems. For instance, in 1997 the Federal Railroad Administration cited regulatory safety violations in aspects of Capital Metro's railroad facilities, such as nonfunctional railroad crossing signals and crossing arms, and threatened the authority with penalties.4 As part of its response to this situation, Capital Metro transferred an FDC employee who had managed 22 different construction projects for the authority to the Railroad Right-of-Way Department, where he will now act as construction coordinator for projects related to railroad facilities. While this employee is highly competent at managing typical construction projects, the construction and rehabilitation of railroad signals and crossings requires an understanding of highly specific federal laws and regulations. Thus Capital Metro is losing the services of a seasoned construction specialist by placing him in a role that will require additional training. This type of crisis response without consideration for long-term effects appears to be fairly common at Capital Metro.
A. The manager of the Facilities Design and Construction Department should complete a comprehensive master facilities plan by September 1, 1998.
The plan should specify staffing needs for various facilities units and force facilities managers to determine and plan for their own staffing and expertise needs. The plan also should clearly assign responsibility for construction project management to the Facilities Design and Construction Department.
A master facilities plan would improve the management, coordination, and efficiency of Capital Metro's facility operations. After the plan is developed, it should be updated annually. In the future, a team representing each facility-related unit should participate in the continuing development of this plan.
B. Capital Metro's senior managers should review and evaluate the Facilities Design and Construction Department's staffing needs, specifically the department's workload and the qualifications, training, and expertise needed to perform the department's tasks. This review should be complete by January 1, 1999.
This review would allow Capital Metro to review and adjust the department's staffing as needed to equip it properly for implementing the master plan and for accomplishing tasks associated with other recommendations in this chapter.
These recommendations could be achieved with existing resources.
Improve management of the contract with its railroad operator.
For many years, Capital Metro's board and staff have ignored one of the authority's major assets, the railroad line. Because of this neglect, the federal government is requiring Capital Metro to pay a substantial amount of public funds for long-overdue repairs to the line.
In August 1986, Capital Metro joined with the City of Austin to purchase a 162-mile Southern Pacific railroad line from Llano to Giddings that passes through Austin, with the idea of eventually developing parts of the line for commuter rail. The final purchase price was $9,382,454, $6 million of which came from a grant to the city from the Federal Transit Administration (FTA). Austin provided $600,000 of its own funds as well, while Capital Metro contributed about $2.7 million. According to Capital Metro, the railroad line had an appraised value of about $70 million at the time of purchase.5 A more recent (September 8, 1995) appraisal by real estate advisors Bates/PA JV, however, valued the line at about $56.3 million, a decline of $13.7 million.
With this purchase, Capital Metro and the City of Austin became responsible for the maintenance, rehabilitation, and improvement of railroad facilities on the line (including railroad bridges, signals, track ties, and crossing equipment) and thus for ensuring that carriers needing to use the line can do so. In May 1998, Capital Metro purchased Austin's share of the line for $1 million and thus assumed sole responsibility for these functions, as well as for any eventual light rail system that uses the line.
A history of neglect
Capital Metro's management of its railroad line has been marred with repeated examples of mismanagement, inadequate oversight, poor internal controls and record-keeping, and misuse of staff.
Capital Metro and the City of Austin have relied on contracted operators to maintain and operate the railroad line since its initial acquisition. The Austin & Northwestern Railroad Company, Inc. (AUNW) operated the line for Capital Metro and the city from August 1986 until March 1996. Under this firm's management, the track deteriorated to such an extent that only 52 miles of its 162-mile length were operable for railroad freight traffic. The devaluation of the line from $70 million in 1986 to $56.3 million in 1995 can be attributed to a general lack of maintenance, repair, and intelligent management.
In 1994, Capital Metro contracted for two audits of AUNW's management of the railroad line. The first one conducted by Sprouse & Winn, an accounting firm, covered an operational period from July 31 to December 31, 1986. Sprouse & Winn noted that AUNW had sold fixed assets of the line without informing Capital Metro of the sales or the proceeds involved, and had been forced to pay $30,800 in fines to the Federal Railroad Administration for violations of railroad safety statutes.6
A second review of AUNW operations was conducted by HDR Engineering, Inc. In an August 1994 report to Capital Metro, HDR concluded that AUNW "were not railroaders and did not take care of the property."7 AUNW was cited for its failures to develop adequate maintenance and rehabilitation plan; notify the line's owners about changes to the properties; and maintain the track in line with federal safety requirements.8
Since 1996, Capital Metro's railroad operator has been the Central Tennessee Railway & Navigation Company (doing business as Longhorn Railway Company, Railroad Operator). Longhorn's contract with Capital Metro stipulates that it will serve as the railroad freight operator and provide such management as is needed for the efficient and economical operation of freight service on the line, while providing a suitably maintained railway for any future mass transit operations by Capital Metro.
According to Longhorn's contract, the operator must provide a certain minimum level of maintenance, rehabilitation, and betterment of the line. The railroad operator is obligated to rehabilitate any portion of the line on which it provides freight service at least to the FRA's Track Class I status, which would allow freight trains to run on the track at 10 miles per hour and passenger trains at 15 miles per hour. This must be accomplished before the beginning of the third year of the contract (1999). Longhorn also is obligated to provide the line's owners with a rehabilitation schedule and plan for the portions of the line over which it provides freight service; to deposit into an owner's escrow account 15 percent of all gross revenue from freight operations, to be used for rehabilitation and right-of-way maintenance activities; to submit maintenance plans and schedules to the owners for prior approval; and to maintain the entire Scobee-Smoot section-a section of the railroad line that runs from west of Fairland to east Austin-at its own expense.
The contract provides that Longhorn may be deemed in default of the contract for:
- failure to provide freight service required by the contract and by the federal Surface Transportation Board (STB) or any other regulatory agency;
- failure to maintain railroad facilities and physical properties as stipulated in the contract and in accordance with industry standards and federal, state, and local law;
- conduct resulting in suspension of railroad freight service by the STB or any other governmental agency;
- continuous operation in a way likely to lead to the imposition of penalties and fines.
- failure to make payments to the owner under the escrow schedule;
- failure to file documents or applications with regulatory agencies, resulting in fines;
- failure to pay taxes;
- failure to seek the owner's written consent for any provision of the contract requiring such consent; or
In turn, Capital Metro, as owner, may be deemed to be in default of the contract for the following:
- continuous failure to act in good faith in reviewing and approving or denying rehabilitation and right-of-way maintenance projects suggested by the railroad operator.
- continuous conduct by any owner that unreasonably impairs the operation of railroad freight service.9
Capital Metro's fiscal 1998 budget allocated more than $1.5 million for safety improvements along the line required by the FRA. The Right-of-Way Department, however, anticipates the FRA may require additional improvements costing $1.6 million in each of the next two years. Capital Metro most likely will include these expenditures in its fiscal 1999 and 2000 budgets. 10
An October 31, 1997 draft memo to the FRA Southwest Region administrator from an FRA railroad safety specialist indicates that the line is severely out of compliance with federal requirements. Specifically, the inspector found "defect ratios" ranging from 368 percent to 863 percent; the FRA considers defect ratios of greater than 15 percent to be unsatisfactory. He also indicated that assessable civil penalties for these conditions could be as high as $63 million. The safety specialist recommended that the authority and the City of Austin develop a safety action plan to restore the line, and noted that "should these recommendations not be explored for an equitable solution, in the interest of public safety, an emergency order halting operations of all freight and passenger rail service should be put into effect immediately and maximum civil penalties requested and assessed."11
While the contract does obligate the railroad's owners to cooperate with the railroad operator in obtaining federal, state, and local grants for improvements, a strict interpretation of the contract suggests that the railroad operator should be responsible for these costs, through its payments to the owner's escrow account. Nevertheless, FRA is requiring immediate improvements to the line and, regardless of the contract, is looking to Capital Metro to fund these improvements.
The contract terms also raise serious questions about the railroad operator's satisfactory discharge of its obligations. For example, in its 1996 annual report to Capital Metro and the City of Austin, Longhorn explained its failure to provide a required track rehabilitation and maintenance plan by stating that:
Some of the things that are contractually required to be done, could not be done due to circumstances that have arisen, many which are positive, since the execution of the contract. An example of this relates to the track rehabilitation and maintenance plan, which is overdue. The grant of ISTEA funds was implemented, one new grant was acquired for the railroad out between Llano and Kingsland, and there is an Application,...to the Railroad Commission of Texas, to get some additional grant money, for rehabilitation of railroad from Giddings to Austin, with the use of Local Freight Railroad Assistance funds from the Federal Railroad Administration. Until it is known how, and where, and to what extent these funds are to be used, it would be an exercise in futility to attempt to arrive at a meaningful rehabilitation and/or maintenance plan for the railroad... 12
An attorney engaged by Capital Metro to handle railroad-related matters told TPR that the authority believes Longhorn to be in "substantial compliance" with the contract.13 Capital Metro recognizes that the current railroad operator is having difficulty meeting its contractual obligations but feels that it is making a good-faith effort to do so, given the extremely poor condition of the track when it assumed its present responsibilities. For instance, 150 miles of the track now are operable for rail service, compared to the 52 in this condition when Longhorn assumed control of the railroad operation in May 1996. Furthermore, annual railroad traffic on the line has tripled since Longhorn took over.14 However, revenues from the railroad operations have not kept pace with needed rehabilitation and maintenance expenses.15
Nevertheless, the fact remains that Capital Metro is paying a substantial amount of public funds for rehabilitation and improvements that its contract suggests should be performed by Longhorn.
A. Capital Metro should enforce the contract's sections pertaining to the submission of maintenance and rehabilitation plans and schedules.
Capital Metro cannot monitor railroad line maintenance and rehabilitation performed by the freight operator without the submission of workplans and schedules. These plans and schedules are key elements of the contract and Capital Metro should insist on their timely submission.
B. Capital Metro and the Longhorn Railway Company should diligently pursue federal, state, and local grants available to fund the escrow account at the level needed to satisfy the contract's maintenance, rehabilitation, and betterment requirements.
These recommendations, if successfully implemented, would aid in the maintenance and repair of the railroad.
Audit leases and licenses connected with the railroad line and restructure the responsibilities and staff assignments of the Railroad Right-of-Way Department.
Regardless of the activities of its railroad operators, Capital Metro itself is responsible for many of its railroad line's problems. In many cases, Capital Metro has failed both to maintain proper oversight of the contractor and to properly manage the railroad activities for which it is solely responsible, such as the administration of leases and licenses on the railroad line's right of way. These leases and licenses cover buildings, utility installations, and crossings on railroad property, as well as the right to run certain traffic over the tracks.
Throughout much of its involvement with the railroad line, Capital Metro assigned only one person to oversee the operation, relying on the contractor to run the line on a day-to-day basis. Because of its impending sole ownership (Capital Metro purchased Austin's share in May 1998) and the need to address FRA non-compliance issues regarding railroad signals and crossings, Capital Metro increased the staff in the Railroad Right-of Way Department to four FTEs in March 1998. Currently, the Railroad Right-of-Way Department is staffed with three people and has one vacant position. Before the March 1998 reorganization, the present department manager was a real estate specialist who managed all of Capital Metro's leases and licenses including those involved in the railroad right of way. A second department employee, the railroad property agent, manages leases and licenses along the railroad right of way; this person, moreover, performed the same function for the Railroad Department from 1991 to 1994. The department also has a railroad construction coordinator who is responsible for coordinating and monitoring railroad construction projects along the railroad right of way. Before the March reorganization, this person served as a project manager for construction projects in Facilities Design and Construction Department. Finally, the vacant position is for a real estate specialist. It is unclear what this position's duties will be, since it seems that the property agent already performs the tasks of a real estate specialist.
A document issued by Capital Metro's now-disbanded Development Division concerning railroad projects for fiscal 1998 contained the following statement:
Capital Metro is currently in the process of acquiring ownership of the entire 162 track miles Giddings - Llano railroad right-of way from the City of Austin.... There are several lease and license agreements currently in place. The largest agreements are the Rail Freight Agreement and the Historic Stream Train Excursion Service Agreement. These and other agreements will require close attention and management.16
The fact is, however, that over the last four years Capital Metro has paid very little attention to the management of licenses and leases on its railroad right-of-way. The situation has become critical; the Railroad Right-of-Way Department has not kept accurate records of leases and licenses along the right of way since 1994. Department staff openly admit, moreover, that many of Capital's Metro leases have not been reviewed in years and could be renegotiated to generate more revenue.17
No accounting for leases and licenses
When TPR staff asked the department how many leases and licenses are maintained on the railroad right of way, they were told that there were at least 2,500 to 5,000.18 In fact, however, the Railroad Right-of-Way Department quite simply has no idea of how many leases and licenses it administers.
When TPR staff requested a list of all leases and licenses on the railroad right of way, the department could only provide a report from 1994 listing 61 license agreements. TPR requested information on the amount of revenue coming in on these leases, but the staff has no record of these figures. TPR then asked the Finance Department for a list of all licensees who made payments during the previous year. This report produced a list of 65 licensees, most of whom appeared on the 1994 report. Based on these two reports, it appeared that Capital Metro had established only four new licenses over a four-year period. The staff of the Railroad Right-of-Way Department believe they established more than three over this period, but could not tell TPR how many. In an effort to resolve this question, TPR reviewed the logs for new licenses from 1994 to the present. This review found a number of inaccuracies; many licenses listed in the log were never issued. When TPR asked to see supporting paperwork or applications for these licenses, the department manager could not even open the file cabinet in which the files are stored.
A week later, the department was able to provide a list of 33 new licensees since 1994, but it seems far from certain that this is a complete list. TPR hoped to help the department identify additional revenue opportunities from licensing, but the authority's records are in such poor condition that it proved impossible to do so.
Department staff admitted that, at present, they cannot determine whether they are receiving the appropriate payments for all of the authority's leases and licenses and are not sure whether they are even charging appropriate amounts for the ones they know exist.19 One lessee on Capital Metro's right of way told TPR that they have been unable to get accurate information concerning their lease from Capital Metro. TPR also noted that, in this case, the lease amount had never been raised since Capital Metro took over the rail line in 1986.
TPR also found that the Railroad Right-of-Way Department is inappropriately staffed, with poor matches between staff skills and job responsibilities. One example of this is the placement of a former Facilities Design and Construction project manager, a seasoned construction specialist, to coordinate railroad construction projects along the right of way. This employee, once essential to the FDC Department, will require additional training to manage any construction and rehabilitation projects connected with railroad signals and crossings, which are subject to highly specific federal guidelines and regulations. A representative of the Texas Railroad Commission told TPR that a railroad construction coordinator should have knowledge of the railroad industry and some background and experience in railroad construction, as well as a technical background in railroad equipment and facility specifications and in electrical systems, if signals or crossing installations are part of the project. Generally he felt that it would be more appropriate to hire someone with these skills and qualifications than to train someone for the task.20
Furthermore, the department's manager has been entirely ineffective in maintaining railroad lease and licenses, and seemingly has little interest in or knowledge of this function. The manager has no role other than to act as a liaison with the railroad operator. TPR found evidence that Capital Metro's right-of-way records were considerably better-maintained in 1994 and before, when the present railroad property agent had sole responsibility for this function.
A The general manager should immediately merge the staff of the Railroad Right-of-Way Department into the Facilities Design and Construction Department. The staff should report to the manager of the FDC.
TPR believes that the small staff of Railroad Right-of-Way Department should be assigned to FDC as a section of the department. This would allow Capital Metro to reduce its supervisory staff, because the current supervisor of the Railroad Right-of-Way Department would not be needed, and would allow the property agent and railroad construction coordinator to continue to perform their duties.
Currently, the Railroad Right-of-Way Department is composed of one manager who supervises two employees. The FDC Department is made up of a manager and three employees. The merger would create a more reasonable span of control for the manager of FDC, who would now be responsible for six employees.
B. The board should require the manager of the Facilities Design and Construction Department to prepare a complete catalogue of all existing leases and licenses on the authority's railroad right of way by December 31, 1998.
The board should make this a priority project and direct the department to provide monthly progress reports to the general manager and board. The project should result in a comprehensive database of leases and licenses, payments, and relevant dates.
C. The Railroad Right-of-Way Section in the Facilities Design and Construction Department should determine the fair-market value of the property it leases and licenses and report to the board no later than June 1, 1999 on its holdings.
Based on Capital Metro's 1994 listing of 61 leases, TPR estimates that these leases generate $60,200 annually. A review of this rather dated list shows that Capital Metro has not reassessed the fair-market value of its holdings. For example, one lease holder is paying $1 per year, as originally negotiated in 1952.
D. Capital Metro should move the railroad construction coordinator back to Facilities Design and Construction and hire a new and appropriately qualified employee for this position.
TPR believes the present railroad construction coordinator could serve Capital Metro more effectively in his original role as a construction manager for FDC. The Railroad Right-of-Way unit needs a railroad construction coordinator to oversee projects along the line, however, and this person should be fully qualified in the specific statutory and regulatory requirements involved in railroad-related activities and construction projects.
If these recommendations are implemented, Capital Metro would save $64,175 ($45,839 plus benefits of 40 percent) annually by eliminating the Railroad Right-of-Way supervisor position. The current railroad construction coordinator could be returned to FDC in a lateral transfer, at no additional cost; based on the position's present salary. The new railroad construction coordinator position would cost Capital Metro an additional $70,739 annually ($50,528 plus benefits of 40 percent).
Once Capital Metro determines the fair-market value of its leases, it should be able to increase revenue. A conservative estimate assumes $987 in lease payments annually x 500 leases, yielding an additional $493,500 in revenue. The net fiscal impact is estimated at $487,000.
|Fiscal Year||Annual Savings||Annual Cost||Annual Revenues||Net Fiscal Impact|
Inventory passenger amenities monthly and base future purchases on need.
Capital Metro has a store of excess passenger amenities, such as bus stop shelters, benches, and litter cans. These extra amenities either were never used or were placed at bus stops that subsequently closed and then were placed in storage.21 When TPR requested an inventory of stored amenities, however, the Public Facilities Maintenance supervisor was not able to readily provide a copy; the review team finally received a hand-written inventory two weeks later. It has since been reported to TPR that the section now is preparing monthly passenger amenity inventories. Capital Metro has the following bus stop amenities in storage (Exhibit 33).
|Item||Downtown Bus Depot||Pflugerville Storage|
|Shelters 10' x 10'||8||6|
|Shelters 7' X 14"||0||3|
Source: Capital Metro.
Responsibility for amenities purchases unclear
TPR found considerable confusion as to which Capital Metro unit is responsible for buying and installing bus stop shelters, benches, and litter cans. In the past, such items have been budgeted for and installed by the Public Facilities Section. Recently, however, the Facilities Design and Construction Department became involved in the process, including $240,000 for bus shelter construction, $20,000 for benches, and $14,400 for bus shelter architecture and engineering in its fiscal 1998 budget. Public Facilities was unaware of any need for additional shelters and did not know until after the fact that FDC had budgeted for them.
As noted above, Capital Metro has some extra shelters in its inventory; moreover, Capital Metro completed a major expansion of passenger amenities just two years ago. TPR can find no convincing need for extra shelters at this time.
A. The Public Facilities Maintenance manager should prepare and submit a formal monthly inventory report of all bus shelters, benches, and litter cans in storage to the supervisor of the new Facilities Division.
Capital Metro should take proper precautions to protect its assets. The Public Facilities Maintenance manager should be held accountable and responsible for maintaining an accurate inventory of stored passenger amenities, not only because of the cost of these items but also because it is simply a useful practice.
B. Capital Metro should cancel its current plans to purchase additional shelters. The authority should take steps to ensure that all future purchases of passenger amenities are based on a documented need.
Recommendation A could be accomplished with existing resources.
Capital Metro could realize immediate savings by canceling its plans to spend $274,400 on additional shelters and other passenger amenities in fiscal 1998.
Seek more competitive bids for purchases of bus stop shelters, benches, and litter cans.
From 1992 through 1996, Capital Metro purchased nearly $6.3 million worth of bus stop shelters, benches, and litter cans from the same vendor (Exhibit 34).
|1,079 Bus Stop Benches||$3,064,918|
|1,442 Bus Stop Litter Cans||658,849|
|636 Bus Stop Shelters||2,563,518|
Source: Capital Metro.
TPR reviewed documents concerning the bidding processes for these contracts. Often, as few as two bidders responded to the authority's invitations to bid on contracts worth a quarter-million dollars or more. For example, consider the following data on three contracts related to the fabrication and installation of bus stop facilities (Exhibit 35):
|Bid Item||Year||Number of Bidders||Winning Award Amount|
|900 Litter Containers||1995||2||$403,200|
|800 Litter Containers||1993||2||$279,200|
|Fabrication/Installation of 225 Bus Stop Shelters and 725 Benches||1993||3||$1,280,950|
Source: Capital Metro.
The same company won all three contracts. Such patterns suggest that Capital Metro may be drawing requirements and specifications in a way that discourages participation by a larger pool of vendors.
Capital Metro should review and revise its bidding process for shelters, benches, and litter cans to encourage participation from more vendors.
Bid requirements and specifications can be written so strictly that they discourage bidders and thereby limit the potential number of bidders for a contract. Capital Metro should review its bid documents and processes and make appropriate revisions to encourage vendor participation.
The fiscal impact of this recommendation cannot be determined, but greater participation in the bidding process should yield savings.
When more are needed, purchase industry-standard shelters, benches, and litter containers.
Capital Metro purchases custom-designed bus stop shelters and litter containers at a substantial price. TPR met with other contractors in the Austin area who manufacture and install outdoor facilities such as benches, shelters, and litter cans. They indicated that the items Capital Metro purchases are fairly priced considering their design but also noted that, because Capital Metro insists on custom designs, it would be hard to find other companies that would even consider making them.
The industry standard for litter containers, for instance, is round. 22 The square design that Capital Metro uses is rare and adds substantially to its cost. The same is true for the shelters; Capital Metro has chosen to use a shelter with custom design features that raises its cost by as much as 25 percent. Yet many companies can supply suitable outdoor shelters and offer many types of designs to accommodate customer wishes. Capital Metro could procure perfectly adequate stock shelters and litter containers for far less than its custom-designed equipment.
In reviewing the contract for Capital Metro's shelters and litter containers, TPR was able to identify the following unit costs for each of these items
(Exhibits 36 through 38).
|Fabrication and assembly of litter container and liner||$308|
|Installation of container and ciner||$68|
|Installation of concrete pad||$72|
Source: Capital Metro.
|Total Unit Price|
|Fabrication of straight benches||$176||$216||$392|
|Installation of straight benches||$10||$78||$88|
|Fabrication and installation of straight bench pads||$140||$140||$280|
Source: Capital Metro.
|Description||Materials Costs||Services Costs||Total Unit Price|
|Fabrication of bus stop shelter||$1,140||$938||$2,078|
|Installation of bus stop shelter||$46||$300||$346|
|Fabrication and installation of bus stop shelter pads||$950||$1,886||$2,836|
|Fabrication and installation of four-inch sidewalks||$2 per sq. ft.||$3 per
|Fabrication and installation of two-foot retaining wall||$22 per
|Fabrication and installation of three-foot retaining wall||$27 per
|Fabrication and installation of four-foot retaining wall||$30 per
Source: Capital Metro.
TPR did not total the costs for shelters because these costs vary depending on the height of the retaining wall to which the shelters are attached. However, the cost for fabrication and installation of the shelter and its pads alone totals $5,260 apiece. TPR interviewed representatives of companies that manufacture street and park fixtures such as shelters, and found that stock shelters with seating, wheelchair accessibility, and overhead cover space identical to Capital Metro's could be purchased and installed for as little as $3,650 each.23 TPR also found that a local civic organization, Keep Austin Beautiful (KAB), could provide Capital Metro with similar litter containers for about $245 each.24
Capital Metro's Facilities Maintenance manager is aware that the authority pays a premium for its amenities but said that more expensive, higher-quality materials used in their manufacture help to reduce subsequent maintenance costs.25 For example, the paint used is a high-grade industrial paint that resists petroleum-based products, making it easier to remove graffiti. He also felt that the authority's amenity designs offer more security and provide better passenger comfort. Other vendors, however, make similar claims about their products. 26
In all, the custom design of Capital Metro's amenities appears to be the most important factor in their price. TPR could find no compelling reason why Capital Metro's litter cans must be square or its shelters custom-designed.
As more become needed, Capital Metro should purchase industry-standard shelters, benches, and litter containers.
TPR does not recommend the purchase of any unnecessary litter containers, shelters, and benches. When more become necessary, however, Capital Metro should reduce its costs by purchasing industry-standard items. For example, standard round litter cans can be purchased for $245 apiece ($210 for the metal container and $35 for the liner) versus the current average unit cost of $376 ($308 for the square container and $68 for the liner); this would yield a savings of $131 per unit. Similarly, Capital Metro pays about $5,260 for each custom-designed shelter; TPR's interviews suggest the authority could reduce the unit cost to $3,650 without a loss in quality. This recommendation ultimately could yield significant savings.
Had Capital Metro purchased industry-standard shelters and litter containers over the past eight years, it would have cost the following amount:
|636 Shelters x $3,650 each =||$ 2,321,400|
|1,442 litter cans x $245 each =||$ 353,290|
|Total Cost||$ 2,674,690|
Capital Metro actually paid $3,222,367 for these facilities. Thus the savings would have been $547,677 ($3,222,367 -$2,674,690).
The actual fiscal impact of this recommendation would depend on Capital Metro's future needs and actions and cannot be estimated.
Stop collecting trash and reinstate the contract with the "Keep Austin Beautiful" program.
At present, Capital Metro's Public Facilities Maintenance Section picks up trash at the bus stops at an annual cost of about $150,000. Trash collection is by far the section's most time-consuming activity, accounting for a third of its work hours. Yet this service could be performed by the City of Austin for considerably less.
In the past, Capital Metro relied on the City of Austin to provide a portion of this service. In 1988, Capital Metro, along with four other major sponsors-Austin Cablevision (now Time Warner), 3M, the Austin American-Statesman, and Texas Disposal Systems-entered into an agreement with the Keep Austin Beautiful (KAB) civic organization for litter cans. KAB asks members of the area's business community to sponsor its litter container program; sponsors pay KAB $245 per litter container and in return their company or organization names are placed on the containers. KAB then donates the litter containers to the City of Austin, and thereafter the city is responsible for maintaining and servicing them. A sponsorship lasts for five years and can be renewed at a cost of approximately $125. Renewal fees are used to refurbish the litter containers.
Capital Metro sponsored 150 of these litter cans and participated in the program for about two years. During its participation, the authority became dissatisfied with the city's servicing of the litter containers (specifically, the frequency of litter pickup).27 However, while problems with city service were common during the early days of the KAB program, at present the city services all of the KAB-sponsored litter containers daily.
Bigger problems arose from two other issues. The first was that Capital Metro wanted KAB to supply them with square litter containers.28 KAB could not comply with this request, stating that round cans are the industry standard used in most communities and that they could not economically fabricate custom-designed square containers for Capital Metro.29 Secondly, in 1992 the City of Austin's Solid Waste Department asked Capital Metro to pay an additional $56,195 in fiscal 1992 and $74,529 in fiscal 1993 above the $245 per container, to pay for a new truck and two employees to service 600 proposed Capital Metro litter containers. Representatives of KAB pledged to fight on Capital Metro's behalf and felt that their chances of avoiding this additional cost were good.30 KAB representatives pointed out that the contract with the City of Austin requires the city to install KAB-donated trash containers, collect their refuse, and maintain the containers, and that KAB intended to enforce the provisions of the contract.31 Nevertheless, for these reasons, Capital Metro quit the program, entered into a contract with a vendor to produce square litter containers, replaced the 150 round cans they initially sponsored through KAB with their own, and assumed sole responsibility for servicing the authority's present total of 1,442 litter containers.
The total cost of the 150 litter containers obtained from KAB was approximately $36,750 (150 x $245 per container and liner; the installation cost was assumed by the City of Austin). Removing the round litter containers and replacing them with square ones cost Capital Metro about $67,200 (150 x $448 per container with liner, including the installation cost Capital Metro was forced to absorb). In addition, Capital Metro also must bear the cost of servicing the cans.
While Capital Metro's concerns about avoiding an additional expense for trash collection were valid, TPR believes that the authority's response may have been premature, inappropriate, and costly. KAB representatives have expressed their sincere willingness to work with both Capital Metro and the City of Austin to work out an arrangement that is mutually beneficial to all parties, even if it means enforcing contractual requirements on the city to collect trash at KAB-donated litter containers. Yet it appears that Capital Metro did not allow KAB to attempt to do so. Moreover, to date none of the other major sponsors have been required to pay any additional money to the city for trash collection from KAB containers. Even so, Capital Metro chose to assume full responsibility for trash collection from its containers, thus performing a service that contributes little to its primary mission and wastes its resources and manpower.
Capital Metro experienced an immediate expense of $67,200 when it left the KAB program and replaced KAB's containers with its own, and wasted another $36,750 by returning the 150 round litter cans to the city. More expensive still, however, was the long-term impact of this decision. Capital Metro has for the last seven years employed a Public Facilities Section staff of 12 persons with 11 flatbed trucks and one pickup who dedicate a full third of their energies to trash collection (Exhibit 39).
|Task||Number of times Performed||Percent of Total Work Activity|
|Trash Collection Service||24,810||33%|
|Shelter Graffiti Removal||3,700||5%|
|Bench Graffiti Removal||3,908||5%|
|Litter Container Powerwash||3,571||5%|
|Litter Container Installation||72||-|
|Litter Container Removal||36||-|
|Litter Container Graffiti Removal||3,854||5%|
|Braille Sign Installation||4,869||6%|
|Braille Sign Removal||780||1%|
|Braille Sign Replacement||356||-|
|Braille Sign Cleaning||1,020||1%|
|Braille Sign Graffiti Removal||975||1%|
|Pole Graffiti Removal||3,654||5%|
Source: Capital Metro.
Staff salaries and benefits for non-administrative staff in the Public Facilities Section total $365,117 in the fiscal 1998 budget.
In August 1997, Capital Metro replaced Public Facilities' truck fleet with 11 new vehicles at a cost to Capital Metro of $45,837 (federal revenue paid for 80 percent of the purchase). The truck fleet, of course, also requires maintenance and fuel. From February through June 1998, the section spent $2,958 for vehicle maintenance and $7,204 in fuel costs for a total of $10,162.
Capital Metro constantly reminds the public that running a transit operation is expensive; while this is true, however, TPR found that Capital Metro involves itself in expensive endeavors that have no relationship to its core mission of providing mass transportation.
Capital Metro should negotiate with Keep Austin Beautiful and the City of Austin to arrange KAB sponsorship for all of its litter containers.
Sponsorship of KAB litter cans is much more economical than Capital Metro's current arrangements; sponsorship for the authority's existing litter cans would mean that the responsibility of servicing them would be assumed by the City of Austin.
The chairman of KAB told TPR that his organization would be willing to work with Capital Metro to obtain city servicing for the authority's installed base of square trash containers.32
The total annual salaries for the 11-person staff of the Public Facilities Maintenance Section, excluding its supervisor, amount to about $365,117 ($260,798 plus 40 percent benefits). A third of these employees' activity is dedicated to servicing litter containers at bus stops; therefore, about a third of these staff salaries could be saved if Capital Metro entered into an agreement with KAB and allowed the City of Austin to perform this task. Capital Metro could eliminate four Public Facilities Maintenance positions, including two positions at $28,909 annually ($20,649 plus 40 percent benefits) for a total of $57,817; another position at $30,372 ($21,694 plus 40 percent); and a fourth position at $34,769 ($24,835 plus 40 percent). Elimination of these positions would save $122,958 annually.
Capital Metro also should be able to reduce its annual maintenance and fuel costs by a third by eliminating in-house litter collection. Over a five-month period (February to June 1998), Public Facilities Maintenance spent $2,958 for vehicle maintenance and $7,204 in fuel costs, for a total of $10,162. The monthly average for these costs during this period was $2,032 ($10,162/five months) or $24,384 annually, which could be saved if Capital Metro rejoined the KAB litter container program.
A KAB representative told TPR that, starting in October 1998, the organization intends to promote new sponsorship for its litter container program, and that if Capital Metro is interested in rejoining the program, KAB would treat all 1,442 Capital Metro containers as renewal sponsorships.33
This is significant because renewal fees are no greater than $125 and can be as low as $55 and a renewal lasts for five years. Therefore, even if the cost of renewal were $125 per container, the annual cost to Capital Metro would be $25 per container per year, for a total annual cost of $36,050 (1,442 litter containers x $25 per container per year).
If this recommendation were implemented, the annual net savings would be $111,292 ($122,958 in savings from eliminating four positions in Public Facilities Maintenance plus $24,384 in fuel and maintenance cost reductions less $36,050 the cost of participation in the KAB program).
These savings would be reduced if the City of Austin imposes charges beyond those outlined in its contract with KAB.
|Fiscal Year||Savings||Change in FTEs|
|Texas Comptroller of Public Accounts|| Window on State Government|
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