Meeting_Body
BUDGET PUBLIC HEARING
FINANCE, BUDGET AND AUDIT COMMITTEE
MAY 16, 2018
Subject
SUBJECT: FISCAL YEAR 2019 (FY19) BUDGET
Action
ACTION: ADOPT THE FY19 BUDGET
Heading
RECOMMENDATION
Title
CONSIDER:
A. ADOPTING the proposed FY19 Budget as presented in the budget document (provided in a separate transmittal and posted on metro.net); and
B. APPROVING the Life of Project (LOP) budgets for new capital projects with LOP exceeding $5 million, included in the proposed FY19 Budget and presented in Attachment A; and
C. APPROVING the Reimbursement Resolution declaring Metro’s intention to issue debt in FY19 for capital projects, as shown in Attachment B, with the provision that actual debt issuance will require separate Board approval; and
D. AMEND the proposed budget to include $2,000,000 for Expo Phase 1 and $20,624,400 for Expo Phase 2, as approved by Expo Construction Authority for fiscal year 2019, for a total addition of $22,624,400; and
E. AMEND the proposed budget to include $25,000,000 for farebox upgrade, as approved by the Board on April 18, 2018; and
F. AMEND the proposed budget to include $500,000 to begin the draft environmental study of the Crenshaw Northern Extension project upon identification of the preferred alternatives identified by the Board for this corridor
Issue
ISSUE
California Public Utilities Code Section 130105 requires Metro to adopt an annual budget to manage the revenues and expenses of the agency’s projects and programs. The budget is the legal authorization to obligate and spend funds and to implement Board policy. It includes all operating, capital, planning and programming, subsidy funds, debt service requirements, and general fund activities for the fiscal year. Budget detail is a management plan for financial activity and is prepared at the fund, project, department, and expenditure level. The legal level of control is at the fund level. Total annual expenditures cannot exceed the final appropriation by the Board except for capital expenditures, which is authorized on a life-of-project basis.
Copies of the proposed budget were made available to the public on May 1, 2018, both electronically at www.metro.net and through the Records Management Center (RMC) at RMC@metro.net. Printed copies of the budget document were also made available at the RMC on the plaza level of the Gateway building on May 1, 2018. The public hearing is scheduled for May 16, 2018. Advance public notification of this hearing was issued through advertisements posted in over two dozen news publications on April 11th and May 1st, 2018.
BUDGET MESSAGE
The transportation landscape of Los Angeles (LA) County is changing. Metro is leading the change with groundbreaking, expansive projects designed to invigorate our current infrastructure. As our population grows, mounting congestion stands in our way. Therefore, Congestion Reduction, along with overall Customer Experience, is Metro’s top priority to improve the quality of life for LA County residents.
Through enhanced transit services and an ever-growing list of innovative new transportation initiatives, we aim to relieve congestion by focusing on the larger mobility picture. This will require addressing the issue of connectivity across all modes and all trip purposes. As we work to integrate trips made by private vehicles and transit with better first/last mile connections, we are moving closer to a transportation network that accommodates the mobility needs of all residents and visitors in LA County.
Metro’s goal in the coming year is to move more people onto transit by making meaningful improvements to the services we provide. In order to appeal to a wider audience and encourage transit use among those who have never used our system, we must create a new customer experience. As a direct approach, we are committed to enhance our transit services by taking advantage of new technologies, such as MicroTransit, more advanced mobile apps, and better real-time information. While we improve overall service and tackle congestion with a comprehensive transportation strategy, it follows that increased ridership will be a natural outcome. Once we prove that Metro is safe, clean, easy to use, and efficient, we can make sure LA keeps on moving.
Discussion
DISCUSSION
The proposed $6.6 billion budget for FY19 is balanced and aligns resources in a fiscally responsible manner to achieve the following goals:
1. Advance safety and security for our customers, the public, and Metro employees
2. Exercise fiscal discipline to ensure financial stability
3. Plan and deliver capital projects on time and on budget while increasing opportunities for small business development and innovation
4. Improve the customer experience and expand access to transportation options
5. Increase transit use and ridership
6. Implement an industry-leading state of good repair program
7. Invest in workforce development
8. Promote extraordinary innovation
9. Contribute to the implementation of agencywide and departmental Affirmative Action and Equal Employment Opportunity goals
As part of the performance management process, Metro will monitor progress throughout the year relative to the Agency goals using measurements such as budget variance, Key Performance Indicators (KPIs) target achievement, Project Milestone achievement and cost savings and new revenue generation through the risk allocation matrix (RAM). This reinforces Metro’s commitment to strategic monitoring of performance and the improvement of accountability.
Resources Summary