[House Hearing, 109 Congress]
[From the U.S. Government Publishing Office]





 THE CAPITAL REGION'S CRITICAL LINK: ENSURING METRORAIL'S FUTURE AS A 
          SAFE, RELIABLE, AND AFFORDABLE TRANSPORTATION OPTION

=======================================================================

                                HEARING

                               before the

                              COMMITTEE ON
                           GOVERNMENT REFORM

                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED NINTH CONGRESS

                             FIRST SESSION

                               __________

                           FEBRUARY 18, 2005

                               __________

                            Serial No. 109-2

                               __________

       Printed for the use of the Committee on Government Reform


  Available via the World Wide Web: http://www.gpo.gov/congress/house
                      http://www.house.gov/reform

                                 ______

                    U.S. GOVERNMENT PRINTING OFFICE
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                     COMMITTEE ON GOVERNMENT REFORM

                     TOM DAVIS, Virginia, Chairman
CHRISTOPHER SHAYS, Connecticut       HENRY A. WAXMAN, California
DAN BURTON, Indiana                  TOM LANTOS, California
ILEANA ROS-LEHTINEN, Florida         MAJOR R. OWENS, New York
JOHN M. McHUGH, New York             EDOLPHUS TOWNS, New York
JOHN L. MICA, Florida                PAUL E. KANJORSKI, Pennsylvania
GIL GUTKNECHT, Minnesota             CAROLYN B. MALONEY, New York
MARK E. SOUDER, Indiana              ELIJAH E. CUMMINGS, Maryland
STEVEN C. LaTOURETTE, Ohio           DENNIS J. KUCINICH, Ohio
TODD RUSSELL PLATTS, Pennsylvania    DANNY K. DAVIS, Illinois
CHRIS CANNON, Utah                   WM. LACY CLAY, Missouri
JOHN J. DUNCAN, Jr., Tennessee       DIANE E. WATSON, California
CANDICE S. MILLER, Michigan          STEPHEN F. LYNCH, Massachusetts
MICHAEL R. TURNER, Ohio              CHRIS VAN HOLLEN, Maryland
DARRELL E. ISSA, California          LINDA T. SANCHEZ, California
GINNY BROWN-WAITE, Florida           C.A. DUTCH RUPPERSBERGER, Maryland
JON C. PORTER, Nevada                BRIAN HIGGINS, New York
KENNY MARCHANT, Texas                ELEANOR HOLMES NORTON, District of 
LYNN A. WESTMORELAND, Georgia            Columbia
PATRICK T. McHENRY, North Carolina               ------
CHARLES W. DENT, Pennsylvania        BERNARD SANDERS, Vermont 
VIRGINIA FOXX, North Carolina            (Independent)
------ ------

                    Melissa Wojciak, Staff Director
       David Marin, Deputy Staff Director/Communications Director
                      Rob Borden, Parliamentarian
                       Teresa Austin, Chief Clerk
          Phil Barnett, Minority Chief of Staff/Chief Counsel


                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on February 18, 2005................................     1
Statement of:
    Corbett, John J., Jr., co-founder, Metroriders.org...........   115
    Downey, Mortimer L., chairman of the board, PB Consult, Inc..   103
    Kauffman, Dana, chairman of the board, Washington 
      Metropolitan Area Transit Authority........................   011
    Millar, William, president, American Public Transportation 
      Association................................................    93
    White, Richard A., chief executive officer, Washington 
      Metropolitan Area Transit Authority........................    20
Letters, statements, etc., submitted for the record by:
    Corbett, John J., Jr., co-founder, Metroriders.org, prepared 
      statement of...............................................   117
    Davis, Chairman Tom, a Representative in Congress from the 
      State of Virginia, prepared statement of...................     4
    Downey, Mortimer L., chairman of the board, PB Consult, Inc., 
      prepared statement of......................................   105
    Kauffman, Dana, chairman of the board, Washington 
      Metropolitan Area Transit Authority, prepared statement of.    14
    Millar, William, president, American Public Transportation 
      Association, prepared statement of.........................    97
    White, Richard A., chief executive officer, Washington 
      Metropolitan Area Transit Authority, prepared statement of.    22

 
 THE CAPITAL REGION'S CRITICAL LINK: ENSURING METRORAIL'S FUTURE AS A 
          SAFE, RELIABLE, AND AFFORDABLE TRANSPORTATION OPTION

                              ----------                              


                       FRIDAY, FEBRUARY 18, 2005

                          House of Representatives,
                            Committee on Government Reform,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:07 a.m., in 
room 2154, Rayburn House Office Building, Hon. Tom Davis 
(chairman of the committee) presiding.
    Present: Representatives Tom Davis, Cummings, Van Hollen 
and Norton.
    Staff present: Melissa Wojciak, staff director; David 
Marin, deputy staff director/communications director; Keith 
Ausbrook, chief counsel; Bill Womack, legislative director; Rob 
White, press secretary; Drew Crockett, deputy director of 
communications; Shalley Kim, professional staff member; Teresa 
Austin, chief clerk; Sarah D'Orsie, deputy clerk; Earley Green, 
minority chief clerk; Rosalind Parker, minority counsel; and 
Jean Gosa, minority assistant clerk.
    Chairman Tom Davis. Well, good morning. The committee will 
come to order, and I want to thank everybody for coming this 
morning.
    The Washington Metro system has become a vital part of 
everyday life in the Nation's Capital, providing an 
indispensable commuting option for hundreds of thousands of the 
area's workers and out-of-town visitors each day. A significant 
segment of the Federal work force also relies on the system, 
making it an integral component of the government's ability to 
function. It is also the primary means of transportation for 
those attending events of national significance, such as the 
Presidential Inauguration, the annual 4th of July celebration, 
and the Cherry Blossom Festival. Metro, in short, possesses a 
national significance.
    Metro was constructed to be a world-class system. As WMATA 
CEO Dick White will note in his testimony today, Metro boasts 
tile and granite platforms and vaulted ceilings. Its cars have 
a modern look to them and contain more seats for passengers 
than do cars on many other transit systems. It is also a system 
befitting the capital of the free world and one in which we 
should all take pride.
    Past administrations and Congresses have recognized the 
national significance of Metro, and the Federal Government has 
long played an appropriate significant role in the system's 
evolution. I have asked the Government Accountability Office to 
prepare a report detailing the role of Federal Government has 
played, and that report is available here today.
    The National Capital Transportation Act of 1969 and 
subsequent amendments in 1979 and 1990 originated in the House 
Committee on the District of Columbia, since incorporated into 
this committee. This remains the committee of jurisdiction over 
Metro. As Metro begins to show the inevitable effects of age 
and ever-increasing demand, it is incumbent upon this committee 
to once again play a leading role.
    In recent years, Metro's management has issued dire 
warnings that the system is in need of significant 
reinvestment. Metro's ridership has grown by 20 percent in the 
last 5 years, and it is expected to double by 2025. As any 
Orange Line passenger will tell you, additional rail cars are 
already urgently needed to meet peak hour demand. In addition 
to new rail cars and buses, Metro has requested significant 
dollars to maintain its existing infrastructure and make 
necessary expansions to reflect the growing metropolitan D.C. 
area.
    In 2002, Metro published a $12.2 billion, 10-year Capital 
Improvement Plan. This plan includes all of the necessary 
maintenance, increased capacity and service expansions Metro 
believes necessary for the original 103-mile system.
    Recognizing the fiscal constraints and political realities 
of the Federal, State, and local governments that fund the 
system, Metro's management subsequently developed a package of 
bare bones, must-have items that reflect the most urgent needs. 
This package, called the Metro Matters Program, consists of 
$3.3 billion for new rail cars and buses needed to relieve 
unmanageable congestion for another 10 years. It also contains 
other measures intended to keep up with demand and maintain an 
acceptable level of service.
    In my opinion, Metro Matters is not a pie-in-the-sky, 
Cadillac of a plan. It is more like a Yugo, a lean, mean 
proposal to keep the system moving, accommodate ridership 
growth and allow the Federal Government to operate effectively. 
It is a program that recognizes that Metro is unique, that 
Metro is a key partner to the Federal Government and a vital 
national security asset. When Metro shuts down, the government 
shuts down.
    Adding to these capital needs are the aggravating factors 
of increased post-September 11 security requirements and the 
growing MetroAccess paratransit program. Both represent 
significant obligations to Metro's budget.
    The recent report of the Metro Funding Panel describes 
MetroAccess as a social service rather than a transit issue and 
did not take costs associated with the program into account 
when making its projections and recommendations. Call it what 
you will; it is a serious matter. In his testimony, Mr. White 
calls for a similar blue ribbon panel to consider MetroAccess, 
and I echo that call.
    Metro has sought to make the case for significant 
additional investment at the Federal, State, and local levels. 
We hope to examine, if not validate, their request today. That 
said, one can't credibly make these requests without also 
taking a close look at Metro's management and operational 
performance.
    Metro suffered a series of embarrassments and problems in 
recent years. For example, Metro's unveiling of the Metro 
Matters campaign coincided with the revelations that millions 
of dollars in parking revenues had gone missing. Last November 
saw an actual train wreck at the Woodley Park station, causing 
20 casualties and disrupting service in the Red Line. Metro's 
implementation of its SmartTrip card program has been fraught 
with difficulties, causing frustration for its customers.
    We have done and will continue doing the management 
oversight we are responsible for, but that will not distract us 
from addressing our larger duty: Ensuring a renewed Federal 
Government commitment to the Metro system. After all, even with 
these high-profile incidents, Metro has been described as one 
of the better-managed transit systems in the country.
    Metro recovers 57 percent of its costs through the fare box 
and other revenue, one of the highest cost recovery ratios in 
the country. But does this figure truly represent an 
efficiently run system? From our witnesses today, we will 
attempt to derive objective measures to determine where Metro 
stands. We will also hear from Mr. White and Mr. Dana Kauffman 
regarding steps they are taking to tighten Metro's ship and 
improve performance.
    There is a great deal at stake in maintaining the 
investment we have made in Metro. More than just keeping the 
proverbial trains running on time, Metro does serve a vital 
role in the day-to-day operations of the Federal Government. If 
there are looming problems, we need to address them before a 
crisis sets in. Today's hearing marks the starting point in 
that endeavor.
    I welcome all the witnesses to today's hearing. I look 
forward to their testimony.
    [The prepared statement of Chairman Tom Davis follows:]

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    Chairman Tom Davis. I now recognize the distinguished 
ranking member, Ms. Norton--you are ranking member today--for 
her opening statement.
    Ms. Norton. Thank you very much, Mr. Chairman.
    I know the entire region appreciates that you have called 
this important and timely hearing, and called it early in the 
appropriations season, I might add, a hearing on Metro's system 
that we are very proud of in this region, as indispensable as 
any system in the region, a system that delivers gas and 
electricity, all the rest of them.
    The region, yes, and the Federal Government, as you said, 
Mr. Chairman, collapses without the Metro system. But I am not 
sure that we have been hard enough on ourselves or, for that 
matter, on the Federal Government in recognizing the problems 
that I think we all have to take responsibility for.
    Metro's growing problems are the responsibility essentially 
of two large actors, the regional governments and the Federal 
Government, their failure of will to take responsibility for 
the funding needs of a system that the Federal Government gave 
everyone a head start on and expected us all to act 
responsibly. Part of this comes from the region's refusal to 
accept its identity as a coherent region, both for roads and 
for Metro. And that, as a coherent region, what we do with 
roads and Metro must reflect that regional identity.
    We see on the roads the most serious congestion at the same 
time that we have mounting Metro problems, but Metro was 
supposed to relieve congestion on the roads. We have one of the 
most congested areas on the roads, even though people are 
clamoring to get on Metro. That ought to tell us a great deal 
about what we have failed to do and what we need to do.
    I remember when we urged people over and over again to take 
the Metro. Guess what? We got what we wished for, and we are 
embarrassed by our success. The crowding may be the chief 
complaint of riders on the Metro, but, ironically, the Metro is 
unable to run its full complement of existing cars. At the same 
time, it needs more cars. Without any reliable capital funding 
source to purchase them, the region is going to end up paying 
more for them and considerably more for them again because of 
funding shortfalls for which we must take responsibility.
    Who is to be held accountable? Let us move first to the 
region, because I don't believe in going to the Federal 
Government and hopping over ourselves as if this were not our 
system as well.
    The region, all three jurisdictions, Virginia, Maryland, 
and the District, demand that Metro act like and perform like a 
regional transportation system without a regional funding 
source. I don't think it is fair to criticize Metro for not 
doing what other systems do with such a funding source.
    The region has no problems holding Metro accountable with 
free-flowing criticism, while refusing to alter the archaic 
funding source and formula that is at the root of Metro's 
problems. Metro is forced to live from paycheck to paycheck, 
almost entirely at the whims of local and State annual budgets.
    Now, face this irony. None of these jurisdictions have the 
alternative of not funding Metro. So why not designate a 
reliable source of funding if you have to come up with the 
money anyway? What are we saving ourselves? Well, we are 
costing ourselves. And I am sure we will hear today how not 
having a reliable source, living from paycheck to paycheck 
costs riders, costs the system, and keeps Metro from reducing 
additional costs that it is now carrying.
    I congratulate Metro for not raising fares for 7 or 8 
years. Although I must say that when you do raise fares, 
everybody is going to scream and holler. I don't even believe 
in that way of dealing with the problems of consumers. I think 
that, to the extent that the regional governments don't want to 
step up and do their part, unless you begin to raise fares 
gradually, over time, instead of letting it pile up and raising 
it at one time, there is no pressure on the regional 
governments to do their part. They could be screaming right 
along with the consumers when Metro decides to raise its fares, 
not to mention what a reliable funding source would do for 
improved management and maintenance of a system that is now in 
middle age.
    The continuing dependence on the present formula and 
funding source raises the most serious problems for one partner 
in particular, and that is the District of Columbia. The Metro 
serves only part of Maryland and Virginia, but Maryland and 
Virginia are not crazy. They fund--Maryland funds the Metro 
payment, the State of Maryland, entirely, and Virginia pays 
half of it. That leaves D.C., a city without a State, paying 
the largest share to bring huge numbers, increasing numbers of 
suburbanites into the District of Columbia. There is something 
wrong with that, ladies and gentlemen, where those with the 
smallest ridership, those who are least dependent because we 
have people who get around with buses and not only through the 
more costly Metro system are paying the largest shares as if 
this were 1967 rather than 2005.
    That is unsustainable for the District of Columbia to 
continue to do as Metro's costs rise, and I put everybody on 
notice now, we cannot sustain the present cost the present 
formula forces on us. The Revitalization Act, with the 
indispensable help of the chairman, took some costly State 
functions and left us with a whole lot of others, including the 
Metro payment. As Federal funding for mass transit has been 
reduced, States have stepped up and increased their funding. 
What is the District of Columbia, without a State, to do in 
that situation? The Metro payment is a leading cause of the 
District's structural imbalance. Unsustainable.
    A primary cost of Metro's major funding problem, however, 
is the region's major employer, the Federal Government. The 
Federal Government helped build the system, but not as a gift 
to the region. Not then, not now, and not ever does the Federal 
Government just go out handing out money. It did the same kind 
of quid pro quo that every other major employer does. It funded 
Metro more than it funded other systems because the Federal 
Government could no longer do without Metro.
    By the 1967 opening of Metro, we were already very late in 
opening a system. There had been no room for some time in D.C. 
for many Federal agencies. We had proliferated the Federal 
Government into the region. The Federal Government was by then 
a major regional employer. It needed Metro a whole lot more 
than the District of Columbia needed Metro.
    The continuing dependence of the Federal Government on the 
Metro system is seen by the subsidy that all of us support for 
riders to encourage the use of Metro. It makes good sense. The 
result, however, is intolerable crowding, traceable directly to 
the Federal Government and its employees, who are almost half 
of the ridership.
    The region has no alternative but to look to the Federal 
Government for a subsidy greater than that provided for other 
systems under TEA 21 because this system is indispensable to 
the daily functioning of the Federal Government itself.
    All of us have to do our part, and we all recognize that. 
Because everything we do in this region depends upon the Metro, 
beginning of course with our major employer, the Federal 
Government, including most especially today Homeland Security 
for the region in the post-September 11 era.
    Without Metro, there is no safe passage in the event of a 
terrorist occurrence. The region is a mecca for tourism and for 
national events. This implicates each and every Member of the 
House and the Senate, whose constituents come here to the tune 
of $20 million per year. We have scandalous environmental or 
clean air problems and remain stuck on stupid on that, perhaps 
about to lose some of our Federal funding. Metro is our best 
hope for further reducing air pollution.
    There are many problems--Chairman Davis mentioned them--for 
which management alone must be answerable. For example, when 
there is an accident at the Woodley Park station--I don't care 
how poor your capital funding is. I don't care how deteriorated 
the subways become. I spent a good part of my life in New York 
riding on the New York subways, and they were in deplorable 
condition, but they knew one thing: You had better get people 
there safely, no matter what the funding problems were.
    So there is no question that Metro has to be held 
accountable, even as the Federal Government and the regional 
governments don't do their part.
    At the same time, I have to say that I think Metro's Board 
and its management and its employees deserve credit, even 
gratitude, for doing their job a lot better than the Federal 
Government and regional founders and funders have done their 
job. We have shirked our financial and planning 
responsibilities for making sure that a world-class system 
remain world-class.
    I am pleased that Metro has a 10-year plan for improving 
and preserving the system that has been considered one of the 
best in the country. I applaud you for opening yourselves to 
consumer scrutiny, even for matters that you may not be able to 
entirely control, to your advisory committee notes and your 
town meetings, your Board meetings. All of that feedback is 
important for a system like your own. I am sorry it didn't 
exist all along. I welcome that you have opened your Board 
meetings as well to consumers, and I especially welcome today's 
witnesses for any advice and counsel they can give us on how we 
can get the Federal Government and the regional governments to 
move to do their part.
    Thank you very much, Mr. Chairman.
    Chairman Tom Davis. Thank you very much.
    Mr. Van Hollen.
    Mr. Van Hollen. Well, thank you, Mr. Chairman; and I will 
be brief, because I am looking forward to the testimony of our 
witnesses. But I do want to thank you for holding this hearing 
on a very important issue to our region.
    As we all know, people who are out there in traffic or in 
Metro every day in this region know and, as has been said, we 
are clearly, from a transportation point of view, one of the 
most congested areas in the country. And modernizing and 
upgrading and I believe eventually expanding Metro is going to 
be an essential part of the strategy for reducing that 
congestion or, at the very least, at least not getting worse.
    The danger is, given the projected growth, if we don't do 
something on both Metro and other parts of our transportation 
system, it is not that we are going to improve congestion. We 
are going to go from a crawl to a dead stop if we don't do 
something and don't do something about it now.
    Now, Metro has been a win-win for this area. It is 
obviously a win for people who use Metro. It is a great benefit 
to people who are driving, because those are people taking 
Metro who are, obviously, not on the roads with the drivers. It 
is also an essential part of trying to meet the clean air 
standards in this region, which is something that is always a 
struggle for this particular area. So I think it is essential 
the Federal Government do its part in this area.
    Metro has been, in many ways, a victim of its own success. 
Its ridership has doubled, as we heard; and it is projected to 
increase substantially. I was a regular workday Metro rider for 
many years, for about 12 years, and I could see over that 
period of time that it was getting more and more crowded, 
especially during rush hours. Sometimes a train would come, and 
you just couldn't get on. It was packed.
    So it is essential that we provide the revenue to expand 
the capacity so we get more cars on the rails, that we get more 
buses to provide people the transportation links that are 
essential. Because, if we don't, it is going to hurt our 
economy, it is going to hurt our quality of life, and this 
region is going to become a place that is not nearly the kind 
of place to live that it is today even under the difficult 
congestion we have today.
    So I am really pleased that Metro has come up with a plan. 
I think the Federal Government has to come up with its part of 
the $1.5 billion and its share of the $3.4 billion, larger 
number, and I look forward to working with my colleagues to 
accomplish that.
    Thank you, Mr. Chairman.
    Chairman Tom Davis. Thank you.
    You have heard from us. We are ready to hear from our very 
distinguished panel, our witnesses today.
    We have Dana Kauffman, who is the new chairman of the Board 
of the Washington Metropolitan Area Transit Authority.
    Let me just say, on a personal basis, I have great 
confidence in Dana. I knew him as an aide to a young 
supervisor, Joe Alexander in Fairfax County, whose name was 
Metro Joe. Joe was also chairman of the Metro Board. We have 
named one of our transportation centers after him. But, Dana, 
we are just happy to have you here in your initial appearance 
before this committee; and, just from a personal basis, I am 
just proud to have you there. I am very confident of your 
abilities to lead, and look forward to you.
    Mr. Kauffman. Thank you, sir.
    Chairman Tom Davis. We also have Richard White, the general 
manager and chief executive officer of the Washington 
Metropolitan Area Transit Authority. I have seen Dick work in 
the subways. He takes the subway in every day to work, so he is 
a rider and is running the whole operation. William Millar, who 
is the president of the American Public Transit Association, 
thank you for being here. Mr. Mortimer Downey, very highly 
regarded. He is the chairman of the board of PB Consult, Inc. 
And John J. Corbett, Jr., the co-founder of Metroriders.org.
    Thank you all for being here.
    I am going to start with Chairman Kauffman and move on down 
the line.
    Dana, we have buttons there. Your entire statement is in 
the record, so it is all there. Questions will be based on 
that.
    But the light will turn green when you start, it turns 
orange after 4 minutes, red after 5. If you need to take a 
little bit more to sum up, I don't want to limit you, but that 
is kind of--we would like to keep it to close to 5 minutes for 
everybody. But this is your maiden speech here. We want to make 
sure you get all your points in. This is an important issue. So 
thanks for being with us. You are on.

 STATEMENT OF DANA KAUFFMAN, CHAIRMAN OF THE BOARD, WASHINGTON 
              METROPOLITAN AREA TRANSIT AUTHORITY

    Mr. Kauffman. I appreciate it. I hope it doesn't violate 
the formal protocol here, but I would like to begin by saying 
ditto to your comments, very much captured my concerns. Also, 
Ms. Norton, I appreciate on behalf of all the Metro employees 
your recognizing their hard work. Oftentimes, the success has 
been extremely painful, and we are working our way through it.
    Good morning, Mr. Chairman and members of this committee. 
Thank you very much for inviting me today to testify. As 
stated, my name is Dana Kauffman, and I am a Fairfax County 
Board member and currently serve as the chair of the Washington 
Metropolitan Area Transit Authority. I am pleased to have the 
opportunity to answer your questions and tell you about some of 
the fundamental reforms and initiatives that the WMATA Board is 
implementing to improve accountability at WMATA. And that key 
word, ``accountability'', is certainly going to resonate 
throughout all of our testimony.
    I will address your specific questions momentarily. First, 
I want to acknowledge some recent good news about Metro. 
Although WMATA's Board and senior staff have just come through 
a year of tough challenges, many of which are subject to 
questions from this committee, it is important to note that we 
added 10,000 new daily riders in December, a strong sign that 
we are doing something right.
    I am also heartened to see the major article in last 
Sunday's Washington Post reporting the results of recent 
commuter surveys that present more positive news about Metro. 
For example, of those who ride Metro, 88 percent rate our 
service good or excellent in terms of reliability, and 77 
percent rate Metro good or excellent in terms of value for the 
money. These are encouraging numbers, and we look forward to 
working to increase these ratings even further.
    Now to your specific questions. You asked about the 
challenges posed by Metro's reliance on multiple funding 
partners, including the Federal Government. This structure has 
indeed tested WMATA's Board through the years. When Congress 
enacted the National Capital Transportation Act in 1960 
authorizing Maryland, Virginia, and the District to negotiate 
an Interstate Compact, it recognized the necessity of 
continuing Federal financial support, declaring that the 
creation of certain major transportation facilities are beyond 
the financial capacity of local governments in this region. 
That still holds true. WMATA is unique, and I would again 
emphasize unique, among Interstate Compact agencies in serving 
two States, the District of Columbia, and the Federal enclave.
    The WMATA Compact specifies how the 12 members of our Board 
are appointed, how we are financed, and how we procure goods 
and services and the jurisdiction of our police. As to whether 
the Compact should cover additional areas, no obvious or 
geographic expansions are necessary at this time.
    Various amendments have refined and clarified Compact 
provisions as needed. For example, in 1997, a Compact amendment 
brought WMATA into conformity with Federal procurement 
practices. In 1997, the Compact was expanded geographically to 
include Loudoun County, even though it does not contribute 
financially to WMATA because we do not yet provide services 
there. In addition, WMATA occasionally goes beyond its 
jurisdictional boundaries through specific contract-for-service 
arrangements, such as when we won competitively bid-for 
contracts to provide bus service in Prince William County, VA, 
and Montgomery County, MD.
    The Board meets regularly, sometimes we think all too 
often, both as a full Board and in smaller committees to 
consider budget, policy, safety, operations, audit, planning, 
and development matters. We work closely with Maryland, 
Virginia, and the District of Columbia, and also with two 
counties and three cities in Virginia and two counties and 
numerous municipalities in Maryland and the Federal Government. 
The range of opinions, backgrounds and experience among these 
stakeholders sometimes makes consensus difficult. Moreover, 
since inception, the Board's governance has included a 
jurisdictional veto, that is, that no proposal can pass without 
at least one supporting vote from each signatory.
    You asked, does this represent the best governance 
structure? Maybe not. Like democracy, it isn't perfect, but it 
is better than the alternatives. Given the substantial Federal 
financial contributions to WMATA, perhaps there is a role for 
the Federal Government at the table. If that would help to 
forge a stronger partnership, the Board would be happy to 
discuss the idea.
    You ask what steps the Metro Board has taken to improve 
oversight. The Board has an active Audit Committee that meets 
publicly each quarter. In the second quarter of 2004, the Board 
received 42 internal audits from WMATA's general auditor, and 
recently we began to share these audit reports publicly to 
increase accountability.
    In addition, an Ernst and Young audit of WMATA's fiscal 
year 2000 to 2004 operating costs recommended several areas of 
improvement, and we have worked to make those happen.
    Yesterday, I announced my intention, as Board Chair, to 
promote new openness and accountability in the way Metro 
operates. Specifically, we again are establishing a riders 
committee, making our public comments added to our Board 
meetings, continuing to hold town hall meetings, and improving 
access to our records and operations.
    Again, this is a key issue when it comes to funding. We 
have to show that we are real about this.
    In the Washington Post poll I mentioned, nearly 58 percent 
of the region favors establishing a new way to fund Metro. My 
Board of colleagues and I believe now is the time for action on 
the Metro Funding Panel's recommendations. We want to make sure 
the region's policymakers make this blue ribbon panel real, and 
we look forward to your counsel and support as we embark on 
that task. It is key that the Federal Government remain a full 
partner in this effort, just as it was 50 years ago when we 
established what is today known as ``America's Subway.''
    I thank you for the opportunity to be testifying here 
today.
    Chairman Tom Davis. Thank you very much, Dana.
    [The prepared statement of Mr. Kauffman follows:]

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    Chairman Tom Davis. Mr. White. Thank you.

    STATEMENT OF RICHARD A. WHITE, CHIEF EXECUTIVE OFFICER, 
         WASHINGTON METROPOLITAN AREA TRANSIT AUTHORITY

    Mr. White. Thank you.
    Good morning, Mr. Chairman and members of the committee. 
Thank you for the thoughtfulness of your opening remarks and 
also for the opportunity to testify before you this morning.
    My name is Richard White, and I am the general manager and 
chief executive officer of the Washington Metropolitan Area 
Transit Authority. I request that my full statement be inserted 
for the record, along with the several attachments to my 
testimony, including the answers to the six questions posed in 
your invitation letter, a 2004 report by the Brookings 
Institution, and a report issued in January 2005, by the Metro 
Funding Panel.
    More than 50 years ago, the Federal Government in this 
region forged a vital partnership to pursue a grand vision to 
design and build a rapid transit system that would serve the 
Federal Government and be worthy of the Nation's Capital. Along 
the way, and approximately 30 years ago, responsibility for 
operating and maintaining a regional bus system was also 
transferred to Metro.
    By any measure, Metro has succeeded beyond anyone's 
expectations in meeting the goals that Congress set. Last year, 
Metro provided 336 million passenger trips on rail and bus. 
Metro rail is the second most heavily used rapid transit system 
in the Nation, and it does carry on a daily basis the 
equivalent of the combined subway ridership of BART, MARTA, and 
the SEPTA subway systems, and Metro bus is the fifth most 
heavily used bus system.
    The 103 mile adopted regional Metro rail system cost $10 
billion to construct, approximately two-thirds of which was 
paid by the Federal Government. The value of this asset today 
represents $24 billion in current dollars. Metro has provided 
an excellent return on this investment, particularly to the 
Federal Government. Designed specifically to serve Federal 
facilities, Metro serves more than 300 Federal agencies today, 
and 47 percent of Metro's rush hour riders are Federal 
employees. What makes the Metro system undeniably unique is 
that Metro was built primarily to serve the Federal work force 
and to serve the national capital area, and it has done so 
admirably for decades.
    But Metro is now a mature system, and it faces a new set of 
challenges. Our infrastructure is aging. Sixty percent of our 
rail system is now more than 20 years old, and daily ridership 
has grown by 33 percent in the last 8 years. The cost of 
operations, maintenance, and rehabilitation have outstripped 
the ability of our State and local funding partners to pay. In 
fact, Metro is the only public transportation system in the 
country without a dedicated funding source to pay for its 
operating and capital funding requirements. The need to address 
this shortcoming is becoming more and more urgent.
    The June 2004, report by the Brookings Institution, 
revealingly entitled, ``Washington's Metro: Deficits by 
Design,'' concluded that WMATA receives less than 2 percent of 
its capital and operating funding from dedicated funding 
sources, as compared to the national average of 34.7 percent. 
In addition, it called WMATA an institutional orphan, with no 
clear funding ownership and a funding structure that creates 
recurring financial crises. It predicts that these funding 
shortcomings threaten to undo more than a quarter century of 
success.
    Mr. Kauffman's and my extended testimony describe a number 
of organizational improvements designed to make our service 
more reliable, responsive and accountable to the public; and I 
would be very happy to expand on these in response to your 
questions. But taking necessary and appropriate management and 
policy actions can achieve only so much. At some point, we need 
more resources. We must reinvest substantially in the system to 
avoid deteriorating service and unmanageable crowding.
    Our State and local funding partners stepped up to the 
plate last fall and signed the Metro Matters funding agreement, 
substantially increasing their funding requirements through the 
year 2010. This is a $3.3 billion 6-year funding plan to 
address a backlog of deferred capital investments and to help 
relieve system overcrowding.
    There are some charts which we have provided to the 
committee and which are posted over there which show 
historically how the system has been funded both from 1975 to 
2003, a current snapshot of our 2005 budget, and what it would 
be if the Metro Funding Panel's recommendations were to be 
implemented for the years 2008 to 2015. I think they are quite 
revealing.
    An independent Metro Funding Panel validated the Brookings 
Report in January 2005. After an exhaustive review, the panel 
found that, even after accounting for periodic future fare 
increases and inflationary adjustments to existing State and 
local subsidies, Metro faces a $2.4 billion shortfall during 
the period of 2008 to 2015, and that excludes a $1.1 billion 
projected shortfall associated with paratransit costs. The 
panel recommended meeting the shortfall through a combination 
of dedicated regional funding and a commitment of $1.2 billion 
in new Federal funds beyond the surface transportation funding 
that we receive today.
    Our message today is that the Federal Government and the 
region have made a substantial investment in an extremely 
valuable asset and one that is designed to serve the Federal 
work force in the national capital region. We must act 
expeditiously to protect that substantial investment. Now is 
the time to recommit to the original Federal, State, and local 
partnership and to put Metro on a stable funding course to 
avoid it slipping into serious disruption.
    I commit to you that we recognize and are facing up to our 
need for improvement. However, a healthy dose of funding is 
required to ensure that the national capital region continues 
to have a reliable transit system that Congress mandated a half 
a century ago.
    We look forward to working with you, Mr. Chairman, and the 
committee and the entire national capital region to address 
this urgent matter. Thank you.
    Chairman Tom Davis. Thank you very much.
    [The prepared statement of Mr. White follows:]

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    Chairman Tom Davis. Mr. Millar, thanks for being with us.

    STATEMENT OF WILLIAM MILLAR, PRESIDENT, AMERICAN PUBLIC 
                   TRANSPORTATION ASSOCIATION

    Mr. Millar. Mr. Chairman, it is my pleasure to be here with 
you today and with my colleagues, and I appreciate the 
invitation. As president of the American Public Transportation 
Association, our association is the Nation's largest trade 
organization that represents both the providers of public 
transportation, such as Washington Metro and New York City 
subways and so many others, as well as the private sector 
companies that supply our industry.
    Also, I am here because I am a regular Orange Line rider. 
This week I used Metro for my regular business, and this week I 
happened to ride all five of the Metro rainbow colors. Orange, 
blue, red, yellow and green. So I am really pleased for the 
interest you are taking in this.
    Chairman Tom Davis. It looks like the recovery ratios are 
going up this week.
    Mr. Millar. Hey, listen, you made money on me this week. 
For sure.
    Anyway, you asked me to comment on three particular areas, 
and I will be happy to do that, and then, at the appropriate 
time, expand on those or get into other areas you might prefer.
    First, related to measuring and benchmarking transit system 
performance. Let me be clear, each community that our members 
operate in is different. Each has unique characteristics. APTA 
itself does not rank its members in terms of their performance. 
However, we do encourage our members to set goals and then set 
appropriate performance measures for their situation and then 
to benchmark against those performance measures. In that 
regard, we also collect and publish a great deal of data that 
allows our members to make some of these comparisons.
    We encourage effectiveness and efficiency. We believe these 
are essential elements to good customer service. And we 
encourage our members to work with our local and State 
governments, with business and community groups to assess how 
well the system is performing.
    In this regard, I think the activity of the blue ribbon 
panel that has already been referred to in testimony today as 
well as the work of the Brookings Institution last year are 
clear examples of a good performance measurement and 
benchmarking activities. I have reviewed this material. I find 
it to be of highest professional standing, very good work, and 
I very much support the conclusions that are contained in both 
those reports. In short, the reports say, and I believe this to 
be true, that Metro is effectively managed and operated, but it 
is going to need help financially if it is going to meet the 
future growth of this region.
    I did take a chance to look at some additional material, 
though, outside those reports; and one area that constantly 
comes to everyone's attention is how well is the labor force 
being used, how are labor costs being managed.
    In an organization such as Metro, labor costs are typically 
the largest portion of the costs of a system with good reason: 
It is a service provided by people.
    Since 1996, some numbers that I reviewed from a recent 
study that an APTA member did show that real wages in the 
public transit industry as a whole since 1996 have been growing 
at a rate much slower than those in the private sector. So then 
I took that general industry look, and I said, well, how does 
it apply to Metro?
    In reviewing multi-year labor settlements last year in our 
industry, there were 57 of them, including WMATA's; and what I 
found was that WMATA's increase of labor cost was the 12th 
lowest of the 57. When you look at that, it represented only 
about 57 percent of the average of that group. Clearly, Metro 
is doing what it can to keep its costs and its largest single 
cost in reasonable shape on this and, more than reasonable, 
below certainly the averages we would expect. So I think that 
says a lot about performance.
    Turning to the issue of the second question you asked, 
which is best practices by public transit systems for 
implementing capital and funding capital improvement programs. 
Again, there are many different ways that transit programs are 
funded, but, in my experience, a couple of characteristics are 
essential to the most successful ones.
    First, we need an--obviously--source that is big enough to 
do the job. Second, it must grow with the needs of the system. 
Third, it must be dedicated so that long-range planning is 
real, so that good plans can be made and carried out over time.
    I wanted to bring to the committee's attention and with 
your permission would put in the record a survey of State 
funding for public transportation. We worked with the U.S. 
Department of Transportation, Bureau of Planning Statistics and 
other organizations to put that together.
    Chairman Tom Davis. Without objection, it will be put in 
the record.
    Mr. Millar. Thank you, sir. I believe there is a wealth of 
information in there that may be useful as the committee 
considers its future option.
    [Note.--The information is on file with the committee.]
    Mr. Millar. The idea of guaranteeing funding is very 
important in dedicating funding, and we see examples at many 
levels of government where the benefit of this is clear. For 
example, at the Federal level, you all passed, and I commend 
you for it, in 1998 the TEA 21 Act that guaranteed for the 
first time funding for public transit. Well, what have we seen? 
We have seen that the money the transit systems were promised 
actually came, that the plans they promised the public they 
were able to implement, and a great deal of uncertainty has 
vanished from the system.
    A similar experience in States that do this and localities 
that do this. It guarantees to the public that they will get 
what they paid for.
    It also helps in other ways. By having a guaranteed source 
of funding, it makes it much easier to attract private 
financing to public transportation, because, as we know, the 
private industry has this strange notion they would like to be 
paid back when they actually invest in things. So certainly 
having good, dedicated, stable and growing funding enables us 
to do this.
    Now, to get a dedicated funding source, the lesson we have 
learned from other regions is that you have to build the public 
support for this; and you can't look at just what you need 
today, you must look what you need over the next 20, 30 years 
or more. We know--others have already referred to it in this 
testimony--our area is going to grow and with it congestion. We 
already know how much congestion there is in this area. We need 
to make the case to people, too, that it is not just people 
like me who ride the system who benefit from this. It is indeed 
the entire region and the States that are involved and the 
District of Columbia in total that benefit from this.
    I brought along another report that again I would like to 
suggest we put in the record. It is entitled, ``How Transit 
Benefits People Who Do Not Ride It: A Conservative Inquiry.'' 
It is by Paul Weyrich and Bill Lind. Mr. Weyrich, as you may 
know, is the founder of the Heritage Foundation, certainly 
great conservative credentials.
    Chairman Tom Davis. Without objection, that will be put in 
the record as well. Thank you.
    Mr. Millar. Thank you very much.
    [Note.--The information is on file with the committee.]
    Mr. Millar. One of the things Mr. Weyrich points out is the 
benefits for people who do not ride include such things as the 
overall economic growth of the region, the growth in tax values 
of the region and that helps in many, many ways.
    The third area you asked me to address was to try to shed 
some light on the lessons learned around the country related to 
paratransit services and the providing of paratransit services.
    Paratransit service, particularly for persons with 
disabilities, has been one of the most important outcomes of 
the Americans With Disabilities Act. It has allowed an 
unprecedented level of mobility for persons that, quite 
frankly, were left out of our society in many ways over a long 
period of time.
    Now this increase in mobility, where we have seen this 
service offered in paratransit in the last 10 years go up by 
over 100 percent around the country, this increase in mobility 
has certainly been beneficial to the persons with disabilities 
and very beneficial to the communities in which they travel, 
but it has also had an obvious impact on transit agency capital 
budget costs and operating costs. For example, in the last 10 
years we have seen capital costs for paratransit rise 
nationally by 163 percent and the operating costs rise by over 
200 percent in that same time period.
    By way of example, in 2003, the last year for which I have 
complete statistics, transit agencies spent some $2.3 billion, 
about 8.8 percent of their operating budgets, to provide 
complimentary paratransit services, to provide service to 
almost 111 million riders. So its benefit can't be argued. It 
has been very beneficial. But the cost effect on transit 
systems, and particularly on systems such as Metro that do not 
have a reliable and growing source of funding, is equally 
undeniable. We do believe additional funding is needed in this 
area.
    We do think there are other things that can be done. We do 
want to encourage the Federal Government to encourage the 
coordination of social service transportation costs. We note a 
1999 GAO report that found there was some 62 different Federal 
human service transportation programs in the Federal 
Government, that the spending, depending on how you counted it, 
ranged from $4 to $7 billion a year. That is almost as much as 
the Federal Government invests in all of public transportation 
every year. Certainly better coordination of the spending of 
that money to make sure it is done as efficiently as possible 
is very important.
    We certainly applaud the work of the Federal Transit 
Administration and other Federal agencies who are trying to get 
their act together, so to speak, through something they call 
United We Ride. And certainly we in the public transit industry 
pledge to encourage that and work them in any way we can.
    In conclusion, Mr. Chair, from the perspective of one who 
has 33 years of experience in the public transit industry as 
well as is a regular Metro rider, as I have already said, I 
find the Metro system to be a well-run transit system. It faces 
many constraints, which I am sure the committee is well aware 
of. But within those constraints it is certainly one of the 
finest systems and one of the best-run systems that I know 
about anywhere in the world.
    I look forward to your questions and expanding on these 
points.
    Chairman Tom Davis. Thank you very much.
    [The prepared statement of Mr. Millar follows:]

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    Chairman Tom Davis. Mr. Downey, you have had a lot of 
experience with systems in New York and elsewhere; thanks for 
being with us this morning.

  STATEMENT OF MORTIMER L. DOWNEY, CHAIRMAN OF THE BOARD, PB 
                         CONSULT, INC.

    Mr. Downey. Thank you, Mr. Chairman, Ms. Norton, and 
members of the committee, for holding this hearing--it is very 
timely--and for inviting me to testify.
    My name is Mortimer Downey, currently chairman of P.B. 
Consult, but I have also served as Deputy Secretary, U.S. 
Department of Transportation, and for many years, at the MTA in 
New York. And like my two colleagues, I am a daily rider on the 
Orange Line from Vienna.
    I also recently had the opportunity to serve as the staff 
director of the Blue Ribbon Panel, it has been referred to 
today. I know you have its report, and I certainly commend it 
to you, not only for its unanimous recommendations as to 
Metro's needs, but also for the data it provides on the 
operations system, on how it compares with others around the 
country, and on where Metro should be going.
    When I look at that issue from the perspective of having 
been in New York, I can tell you that is a place you do not 
want to go--New York is fine, but the condition of its 
transportation system, when I joined it in 1981, was 
deplorable; it was deplorable as a function of lack of 
reinvestment and lack of funding for the system's needs. It was 
below the standard of service, almost below the standard of 
safety; that is not where we want to see the system go. It took 
us years to turn that system around; the job isn't complete 
yet, but they have made enormous progress. They made that 
progress because elected officials, local and Federal, made a 
commitment to investment, made funding available on a dedicated 
basis, made the funding available, and held us at the MTA 
accountable for achieving results.
    That is what needs to happen here if we don't want to see a 
Metro future like the New York past. The recently adopted Metro 
Matters capital program is a good first step, but it needs to 
be followed by more permanent solutions.
    The panel, the Blue Ribbon Panel, made up of bipartisan 
citizens from around the region, strongly endorsed that 
principle of reinvestment, as well as the importance of Metro 
services, in meeting the transportation and economic needs of 
the region.
    Chairman Penner of the panel, Rudy Penner, in his 
transmittal letter, stressed the primary conclusions of the 
report, the fact that there will be a shortfall of revenues--we 
are comfortable with the fact that had to be dealt with--and 
that two partners have to deal with those shortfalls, the 
Federal Government should be a significant participant, 
particularly for capital maintenance and system enhancement, 
and the jurisdictions in Maryland, Virginia and the District of 
Columbia, in the panel's view, should mutually create and 
implement a single regional dedicated revenue source. The panel 
recommended the sales tax, but that is a choice the region and 
the jurisdictions need to make.
    The charts show, particularly the one on the right, that 
partnership has been the watch word for Metro's success over 
the years. The center chart is what the panel recommends going 
forward. Again, a partnership enclosing the increment needs of 
the system through a sharing of local jurisdictions, the 
Federal Government and the riders.
    Metro has been successful over 30 years, holding together 
its new construction program largely by the power of that 
regional Compact. It is a truly amazing feat when you look 
back. But there is no comparable partnership for ongoing 
operations and support. Metro has to go back to its partners 
every year, it would be like recapitalizing your business each 
year, it is not a way to really focus on the important issues 
of management.
    So each of the beneficiaries of Metro service, in our view, 
should be a contributor, the riders, who today, in fact, pay 
fares above the national average and contribute more than the 
average to the support of the system, but that reflects the 
level of service and the nature of their options. The region's 
governments are interested parties and beneficiaries in keeping 
the economy strong, in meeting environmental goals and 
supporting a truly regional set of solutions. But I think the 
Federal Government also belongs at that table. Metro service, 
carrying a significant portion of the government's workers, is 
essential to day-to-day operations, and critical in the event 
of national emergencies.
    Other countries do recognize the special needs of their 
national capital in terms of transit investment. I have been 
working over the past year in London on the rebuilding of that 
system. There is now a partnership in place, $20 billion to be 
spent over the next 5 years, about two-thirds of it from the 
national government, one-third of it raised by debt from the 
system, but it recognizes the need of that region and the 
special responsibility that their national government has. Our 
Federal Government can do the same; not in lieu of local 
effort, but as a partnership to generate workable solutions.
    Again, I commend the committee for timely inquiry into this 
important topic, and I would be happy to answer any questions 
now or for the record, as well as to work with you in 
developing the long-term solutions.
    Chairman Tom Davis. Thank you very much.
    [The prepared statement of Mr. Downey follows:]

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    Chairman Tom Davis. Mr. Corbett, thanks for being with us.

 STATEMENT OF JOHN J. CORBETT, JR., CO-FOUNDER, METRORIDERS.ORG

    Mr. Corbett. Thank you, Mr. Chairman, and members of the 
committee.
    MetroRiders.org is the recently established transit users 
group to help improve public transit services in the Washington 
Metro area. We appreciate the invitation to present our views 
on the current problems and the future needs of WMATA.
    MetroRiders.org was formed primarily because transit riders 
want a safe, more reliable Metro system, efficient management, 
and better coordination with the other bus and train systems 
serving our area.
    Whether or not you personally use the Metro system--and I 
am sure you cannot beat the percentage participation of our 
panel today--you have heard from your staffs that many Metro 
trains are chronically overcrowded, escalators and elevators 
often don't work, rail cars and busses too often break down, 
causing riders to be late for work or getting home. A lot of 
worried looking congressional staffers have to hurry up the 
escalator at the Capitol South station when Metro problems 
lengthen their commute.
    Conversations with Capitol Hill staffers about Metro too 
often are discussions only about Metrorail. To our transit 
riders, Metro also means bus service and the Metro Access 
Paratransit system as well.
    The committee's invitation indicates interest in the 
results of the survey we have conducted on our Web site. In 
short, some 1,500 respondents rated Metro's overall service 
quality as barely fair, two on a scale of four; the results are 
summarized in the first attachment. Mr. Chairman, I compared 
those somewhat negative results with the results of the 
Washington Post survey this past Sunday, and the survey reports 
in the Post are for people who have used the Metro system as 
least once; the people who respond to our Web site are daily 
dedicated Metro users. Even though they have expressed 
dissatisfaction with Metro's operations, our organization's 
objective is a positive one.
    Attached to our testimony is a list of our organization's 
short-term objectives. As you may notice, we believe everyone 
needs to do a better job, and that includes passengers.
    Help from WMATA is needed from Congress as well. Today's 
hearing highlights the effort needed from the Maryland and 
congressional delegations, and from the District of Columbia's 
delegate to help fund WMATA's capital needs. You know these 
better than I, the surface transportation bill is being marked 
up this month. There is an opportunity there for large--high 
levels of formula funds for WMATA for both rail and bus. I am 
sure you will be maximizing your discussions with those 
authorizes.
    On the appropriations side, the Department of 
Transportation Treasury bill generally provides an opportunity 
for earmarks for WMATA to help acquire additional rail and bus 
systems. We hope you will be active again this year, as will we 
and the riders, to try to maximize earmarks for the WMATA 
system.
    Security is a very difficult issue, as you know. You know 
the situation that occurred in Madrid. Even though the 
Department of Homeland Security Appropriations Committees 
generally don't do any earmarking, we hope you will communicate 
the needs of the WMATA staff for high levels of security 
funding in the 2006 process.
    Although WMATA may now be open to setting up a Riders 
Advisory Committee, our organization is convinced that this 
step, however well-intentioned, is too timid a response for 
Metro's users needs for input into WMATA decisionmaking. In 
recent months transit riders were angered to read how few WMATA 
board members actually use the bus and rail systems whose 
funding, whose operation and whose culture they control. Only 
with the addition of a new board member specifically to 
represent Metro system users will our needs truly be heard.
    WMATA's structure and organization is determined by the 
Interstate Compact involving Maryland, Virginia and the 
District of Columbia. A new WMATA board member cannot be added 
without the adoption of substantially similar legislation by 
the three jurisdictions, followed by an approval from Congress. 
Frankly, only amending the U.S. Constitution seems a more 
complex process than modifying WMATA's structure to add one 
board member. We hope Congress will help facilitate an 
amendment to this Interstate Compact to add a rider 
representative to the WMATA board. The New York City Transit 
System has a board member appointed solely to represent riders, 
transit riders here deserve no less.
    Finally, Mr. Chairman, you have discussed the Metro Funding 
Panel report. Upon its release, unnamed officials in some 
jurisdictions intimated in the press that ``This isn't the year 
for increasing taxes.'' The issue has been stalled ever since. 
I understand that a committee of the Virginia legislature early 
this week just voted against any favorable consideration of any 
funding for Metro this year.
    Mr. Chairman, we are fearful that without some 
congressional leadership, there never will be a good year to 
solve WMATA's chronic funding problem. We hope you will 
consider calling another Metro oversight hearing later this 
spring to receive testimony from Governors Erlich and Warner, 
Mayor Williams and the chief executives of the other 
contributing jurisdictions.
    If you were to seek their reactions to the Metro Funding 
Panel's report, and whether they would commit to meeting on a 
date certain with the other involved jurisdictions, your 
intervention could offer a tremendous lift to this unresolved 
important issue.
    Again, our organization is grateful to the committee for 
having scheduled today's hearing, and for the opportunity to 
present our views. Thank you.
    [The prepared statement of Mr. Corbett follows:]

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    Chairman Tom Davis. Thank you. This won't be the only 
hearing we do on this. If we are serious about an authorization 
bill, we have to lay appropriate groundwork, bring the States 
into this as well, and some of the other localities, and we 
will coordinate with you in terms of how we do this and how we 
orchestrate it.
    Mr. Corbett, let me just start--you had an interesting 
suggestion about adding a rider to the Metro board; how is that 
selected in New York?
    Mr. Corbett. Maybe Mort can give us more detail, but my 
understanding is there are nominations made; I think the 
Governor of New York selects a person to represent the riders 
on a panel, and that person changes over a period of time. But 
that person, as I understand it, has the function of 
representing the rider to make sure the board is sensitized to 
people who have daily experience with the system. We are having 
internal discussions; maybe Ms. Norton could give us advice as 
to whether it should have a voting representative or a non-
voting representative.
    Chairman Tom Davis. Well, I mean, I think the membership of 
Metro is something we need--I have no idea where we go with 
this, thinking out loud is dangerous, but to play with it is 
something that we might need to look at.
    And I think, Mr. Kauffman, your comments, you just said 
let's talk about it, so I don't want to have a formal 
discussion here. I know you do have a number of Metro board 
members that ride the subway now--I know Mr. White rides it 
every day; Dana, you ride it, other people--so you have other 
board members, but they are not there as Metro reps, they 
represent taxpayers and community interests and everything 
else. So I think that is something I think we look at as we 
move forward, and we will try to continue the dialog on that.
    Mr. White, why should the Federal Government fund Metro in 
ways it does not fund other subway systems in the country? This 
is our dilemma. We would love to be able to get into the TEA 
LU--or whatever the new transportation bill is called, and I 
know Senator Sarbanes is trying to do that; but the practical 
effect of that, because we have asked for additional money for 
Dulles rail and other areas out of this, the practical side of 
that is we are going into a grab bag where we are going to be 
limited in our ability to get it done.
    I mean, certainly, Mr. Van Hollen will support it, and I 
will support it and Ms. Norton, who is on the committee, will 
support it--she won't be able to vote with us on the floor, 
unfortunately. We are working on that. But the fact is that is 
unlikely to happen. And if you look at traditionally how Metro 
has been funded, it has been a completely separate pot, feeling 
that the Nation's Capital and the work force here basically 
deserve a separate consideration. And if you look at the three 
previous Metro authorizations, that is how it is done.
    So, I mean, I will take the money from wherever we can find 
it, but I think we are going to need additional authorization 
that is going to need some administration buy-in, but we are 
certainly going to push it because it is needed; and if we 
don't, we are not even protecting the current investment. But 
am I missing anything.
    Mr. White. No, Mr. Chairman, I think you put your finger 
right on it because it was recognized that we needed a system 
to serve the Federal work force in the national capital region. 
The Congress, in that recognition, funded specially--outside of 
any Surface Transportation program--the construction of the 
system, and actually invested over $6 billion to that end 
through three separate authorizations of the Congress, 
independent of the Surface Transportation program.
    So I think the question is, now that the system has matured 
and requires reinvestment, is the time appropriate for this 
separate view of this from the Congress, in its recommitment 
with State and local government, to help keep this investment 
in a state of good repair so it can serve the Federal work 
force and the national capital region in the future, and 
perhaps outside of the Surface Transportation program.
    Chairman Tom Davis. Let me ask Mr. Downey, you have had 
experience in the New York system. If a system gets into a high 
level of disrepair, the costs at that point become really 
astronomical, don't they?
    Mr. Downey. Just like your house, if you don't do anything 
with it for years, what you then have to do with it is 
enormous. So the downward spiral of lack of investment, lack of 
ridership, safety issues is clearly a point of a place not to 
go.
    Chairman Tom Davis. Well, let me ask you, Mr. Millar, with 
your knowledge around the country, are you aware of any 
instances where the lack of reinvestment has gone on and they 
have actually had to close stations and have undergone that 
kind of problem?
    Mr. Millar. Yes, sir, that has occurred. Certainly New York 
is an example, Philadelphia is another example; Pittsburgh has 
a line that was closed after years of neglect. And certainly, I 
would second Mr. Downey's statement, in our experience 
rehabilitation after a certain point is just very, very 
expensive, better to keep up with it as you go along.
    Chairman Tom Davis. OK. Thank you.
    Mr. Kauffman, let me ask you, in January, the Metro Funding 
Panel called for a regional sales tax, deserves a dedicated 
roll. Would it be fair to have Federal representation in the 
WMATA board if the Federal Government came in with an infusion 
of cash? Is that open for discussion, do you think, with the 
jurisdictions?
    Mr. Kauffman. I think it is definitively open for 
discussion because certainly--looking, for example, Mr. 
Corbett's issue of rider representation, who would that rider 
be, would that be a D.C. rider, Maryland, Virginia----
    Chairman Tom Davis. I think a Virginia rider----
    Mr. Kauffman. I would think--who happens to be a Federal 
employee who is very concerned about parking.
    But essentially, Mr. Chairman, wedded to a recognition of a 
significant and ongoing Federal contribution, I think that a 
place at the table would definitely be open for discussion.
    Chairman Tom Davis. I mean, I think we are going to have to 
strategize how we can get this--how we can sell such an 
authorization, and then how we reach--how the State and locals 
have to match, something we have been through before.
    Mr. Downey, let me ask you; should any additional Federal 
funding be tied to the WMATA signatories' ability to come up 
with a dedicated funding source?
    Mr. Downey. That has been tried before, but not successful; 
I think it is still worth pursuing.
    In the first of the special reauthorizations for WMATA, the 
Stark Harris bill of 1977--and I represented the then 
administration on putting that together--Congress called for 
the creation of stable and reliable funding to match what the 
Federal Government would do. It didn't come to fruition----
    Chairman Tom Davis. I remember.
    Mr. Downey. Virginia did pass one tax, it kind of fell 
apart in other places and was later forgotten; but it is not an 
idea that should be left----
    Chairman Tom Davis. Maybe we just need better leverage if 
we do. I mean, Mr. Kauffman and I still have the wounds from 
supporting the last transportation for sales tax when we were 
overwhelmingly rejected by our constituents. But I think that 
may have to be part of this as we move forward. These are just 
ideas under discussion, we have a long way to go. This hearing 
today really lays a groundwork for where we want to go.
    I think we will do another round of questions, but I want 
to give the other panel members an opportunity, Ms. Norton, and 
then Mr. Van Hollen.
    Ms. Norton. Thank you very much, Mr. Chairman. I appreciate 
the testimony we received today.
    The chairman just discussed the difficulties of getting tax 
increases for anything in his jurisdiction, that is the case 
throughout, of course, the region. One of the problems, I 
think, is the jargon of ``dedicated funding.'' It doesn't 
really mean anything to the average rider or the average 
person. If I could ask, perhaps, Mr. White or Mr. Kauffman--Mr. 
White may be more in touch with the operations or with the 
capital spending.
    If you had a--everybody knows that we pay for Metro anyway, 
so everybody knows that the money comes from Maryland, Virginia 
and D.C., so what difference would a ``dedicated funding'' 
source mean? In real terms, that people who say don't raise my 
taxes can understand, for example, what would it do for a 
rider, what evidence would they see of improvement in the 
system or maintenance of the system that would make them think 
that whatever that dedicated source took from them, directly or 
indirectly, was worth it? Can you break down the benefits of 
dedicated funding over the kind of funding we already give 
every year which comes out of our pockets?
    Mr. Kauffman. If I could, Ms. Norton, start at the 30,000 
foot level policy, but also incorporating the rider's 
perspective, and then shift for details to Mr. White.
    The real impact of being able to rely on stable and 
reliable service could be most readily captured by the 
struggles the District of Columbia went through not that many 
years ago when there were serious funding challenges facing the 
District and they had to pull back and then sometimes stop the 
regular payments, and the painful real impact to riders is in 
order to maintain funding at the level that could be afforded, 
that a third of the District's bus service was cut, 
discretionary bus service was cut. So by having a----
    Ms. Norton. But what does that have to do with dedicated 
funding?
    Mr. Kauffman. What I am leading to is by having a dedicated 
and reliable stream of funds that we can rely on with a new 
Federal partnership, then the ups and downs of the support we 
have seen from municipalities would be flattened out, that 
impact would be flattened out because today we are really 
dependent on the lowest common denominator member contribution 
and erratic fare increases. By this group acting, it would 
seriously stabilize the impact for riders in the region.
    Ms. Norton. In other words, you are saying that you can't 
count on any specific amount of money, and that it changes from 
year to year?
    Mr. Kauffman. It is subject to annual appropriation by 
member jurisdictions----
    Ms. Norton. Yes. But is there a formula that says that 
everybody has to come up with a certain amount of money every 
year?
    Mr. Kauffman. There is an extremely Byzantine formula that 
allocated both the operating and the capital dollars, and that 
is--unfortunately, as we focus on that from time to time, that 
has proven to be a zero sum game with jurisdictional vetoes at 
bar. I think at least three times in recent history, we have 
tried to readjust the Rail Funding formula, and we ended up 
seriously bloodying each other on the Metro board and did not 
come to closure.
    But I recognize, quite frankly, that there needs to be more 
parity with some of the funds the District puts on the table, 
and perhaps one of the best ways to address that is in concert 
with this new Federal partnership coming forward; and then 
wedding the two, we can make some, you know, very painful 
experiences for our District funding partners a thing of the 
past.
    Ms. Norton. Yes, Mr. White.
    Mr. White. Ms. Norton, I think you, yourself, almost said 
it best in your opening remarks when you said our funding 
arrangement is like living from paycheck to paycheck. I think 
all of us understand in our own personal life what that means 
when we are living from paycheck to paycheck; it means you 
can't really plan on anything, you can't plan on anything 
outside of that which you know you can absolutely afford and 
fit into your baseline budget.
    I think the second descriptor that is one that is 
understood in terms of the analogy of a businessman is what Mr. 
Downey said, you know, the arrangement is like having to 
recapitalize your business every year. If you can't count on a 
multiyear set of funding commitments that you know are going to 
come your way, how can you do capital planning? How can you 
make sure that your physical plan is in a state of good repair 
and buses are replaced when they are supposed to be replaced?
    Ms. Norton. Mr. White, they know the money is going to 
come. It is going to come. So it is the specific amount of the 
money? I mean, it is not going to convince anybody who rides 
the Metro that 1 day somebody may not, in fact, come--Virginia 
may not come forward with this amount, even the District of 
Columbia. You have to help us out. People have to understand 
the relationship between ``dedicated funding,'' which has 
absolutely no meaning to the average person, and something they 
would see at Metro that they don't see today.
    I am still not sure of what it is that they could see, 
because you certainly can't say--you can talk about being more 
stable and all the rest of it, but they know good and well the 
jurisdictions are going to come up with a certain amount of 
money. I do not know if you are telling me that the amount 
fluctuates, that the formula is such that you don't even know 
the ballpark amount that each jurisdiction will give you. I am 
just not sure----
    Chairman Tom Davis. Will the gentlelady yield for just a 
second? Let me also ask, without dedicating funding, what 
happens to capital bonds? That did make that part of the 
question.
    Mr. White. I think that is probably one of the most 
important parts of the finding from the Metro Funding Panel, 
which is to say that you really can't go out and engage in any 
thoughtful capital planning program and one that the market 
would underwrite without a guarantee and the knowledge that 
there is going to be an income stream that is going to come in 
and pay those bills. And obviously, the risk associated with it 
is the less certain the assignment of the money, the higher the 
risk, and therefore, of course, the more of the debt that one 
has to pay to do that.
    But I think in further answer to Ms. Norton's question, it 
really gets down to--what we are dealing with is deferred 
investment and deferred capitalization; but how the rider sees 
it is the reliability of the system and the age of the asset 
that they have. But our funding arrangement, quite frankly, is 
getting down on our hands and knees every year and going to 
about seven or eight funding partners and literally begging 
them for a certain dollar amount. And if any one of those eight 
or nine funding partners say, you know, I have to put my money 
into schools this year, or public safety, or health and human 
systems, and I can't meet your number, in Mr. Kauffman's terms, 
it is a game of lowest-common-denominator policymaking.
    In our history over the last decade or so we have had 
different jurisdictions who have had different pressures on 
their budgets at different points in time, and it is not just 
one jurisdiction; so the cycle is at one point the District has 
a problem, at another point Virginia has a problem, and a third 
point Maryland has a problem. Nobody makes up for the funding 
partners' problems that they may have for those 2 or 3 years, 
everybody rolls down to the lower level, which means that we do 
less.
    Ms. Norton. I will come back.
    Chairman Tom Davis. Thank you very much.
    Mr. Van Hollen.
    Mr. Van Hollen. Well, thank you, Mr. Chairman.
    I mean, I want to pursue some of these ideas that have been 
raised already with respect to how you would structure a 
dedicated revenue stream, and also to address the issues Ms. 
Norton has been raising with respect to the reliability of the 
current income stream.
    First, as I gather, the main idea on the table is some kind 
of regional sales tax, surcharge that would go into a pool. Has 
any more thought been given how that would be structured so 
that the relative contributions that would--the current burdens 
that are, you know, today provided to the relative 
jurisdictions for their contribution to the use of Metro would 
somehow be reflected in the contributions from the different 
jurisdictions through a sales tax? I just do not know to what 
extent this idea has been flushed out.
    Mr. Kauffman. If, perhaps, I could start, and then refer to 
Mr. Downey.
    Certainly the Blue Ribbon Panel, as was mentioned earlier, 
mentioned as a key option a regional sales tax; it also offered 
a litany of other revenue instruments. One of the things that, 
on the one hand, is seen as very valuable is to have the same 
instrument applied across the region, the other is recognizing 
that each locality, each member has a different or best case 
way of raising some of those dollars.
    I would say that yesterday I specifically asked, along with 
members of the Federal--the Board of Trade, the Greater 
Washington Board of Trade and the Federal City Council, that we 
should take that Blue Ribbon Panel and call the regions and the 
Federal-elected leadership together for a summit this summer to 
basically begin acting on those items.
    A menu is prepared, and now we are calling folks to the 
banquet.
    Mr. Downey. If I could just add to that.
    In the Blue Ribbon Panel report, there are analyses of 
where the needs are and where the funds might come from under 
different assumptions.
    The Panel's overriding view was, though, that Metro 
service, bus and rail, is a regional asset. And it is very hard 
to say that someone who lives in Virginia, works in the 
District and occasionally shops in Maryland is paying in only 
one place for that. So the premise of our thinking was 
regionalize it as much as possible. It isn't perfect. The 
numbers show that the burden would shift a little bit; that 
could be ameliorated in a variety of ways, but we thought 
dedication for the resources that have been described, 
particularly for the ability to plan and finance capital, and 
regionalization really reflected the nature of the service and 
the nature of the agency.
    Mr. Van Hollen. Just to followup on Ms. Norton's questions 
with respect to the reliability to which--with the 
contributions to the different jurisdictions have been made 
over a period of time. I mean, do you have any--a chart that 
would show these fluctuations just as part of an argument for 
why we would have to have a dedicated income stream? I mean, 
you were very creative, I guess, in this latest effort to 
modernize, where you went to the jurisdictions and you got them 
to agree to sign--binding contracts to make their 
contributions, and the extent to which they are going to be 
paying depends on the extent to which the Federal Government 
makes its contribution.
    I guess one issue that obviously arises with respect to the 
need for dedicated income stream--because, I mean, look, it is 
going to be complicated getting all these different regions and 
jurisdictions together to agree on something--is the extent to 
which the current system is broken and not working, or whether, 
after at the end of the day, people are really coming through 
with their funding requirements.
    Mr. White. Yes. I will try to shed some more light on this.
    I think the biggest effect of what we have had today is all 
of our assets have been identified--normal replacement cycles 
have been identified for this $10 billion investment that is 
now worth $24 billion, and there is a road map of what you need 
to do to keep your assets in a state of good repair----
    Mr. Van Hollen. Right.
    Mr. White [continuing]. So that we don't slip into the 
scenario that Mr. Downey explained occurred back in New York in 
the early 1980's.
    And what has happened thus far is everybody says, that is 
impossible for us to fund, so we are deferring capital 
investments. And we have deferred more than $300 million of 
things that should have been done to date, and that number 
would go over a half a billion in the next couple of years were 
it not for this funding agreement. And quite frankly, it 
required some sort of forcing function to make this funding 
agreement happen. Everybody looked at one another, said we 
can't do it, our share is too big, the Federal Government 
should be doing more, and we kind of kept on drawing ourselves 
into the ground until we have literally said, we have this rail 
car contract, it has these options in it, these options expire 
on this date, the pricing is enormously attractive if we don't 
exercise these options, and by the way, we can guarantee you 
that if we don't meet this option date it will be too late and 
our rail cars will become so crowded that we can guarantee the 
service will fail.
    And it was only that forcing, literally, that gun to 
people's heads that at the last second did people say, all 
right, well, I have to do this, and I will do this with great 
trepidation. And it bought us about 3 or 4 years of time, and 
we will be back in the same situation 3 or 4 years from now, 
looking for the same forcing function to make something happen.
    And I think that is the dilemma that we are facing. The 
operating side sort of resolves itself, sometimes you raise 
fares, sometimes you tweak the service, depending upon what 
people can and cannot afford on the operating side, but the 
biggest impact is on the capital side measured in system 
deferrals, which catch up to you and have a huge impact on 
service reliability.
    Mr. Van Hollen. I think you make a very good case for it. 
And as we think about this, I think it is also important to 
find a mechanism maybe for the Federal Government to continue 
to be a player going forward. I mean, the question is, after 
you have this income stream where the Federal Government says 
well, you have taken care of the problem and we no longer have 
any obligation ourselves, despite the fact the Federal 
Government should, in my view, for the reasons you stated, it 
is a unique system where the Federal Government has a unique 
interest in it compared to other Metro systems. Thank you.
    Chairman Tom Davis. Thank you. We will do one more round, I 
think, of questions.
    I have a question--Dana, I will start with you, but anybody 
can answer it and step in.
    The Brookings report, ``Washington Metro, Deficits By 
Design,'' points to the increasing Metro ridership from 
outlying jurisdictions. Should we not, therefore, look at 
expanding the area covered by the Metro Compact? These same 
areas want to be included in the definition of national capital 
area for DHS funding. If they are going to compete for these 
funds, doesn't it make sense, maybe to expand the Metro region 
and share the burden?
    Mr. Kauffman. I would not close the door, Mr. Chairman, 
but, for instance, we have had a similar discussion with the 
Virginia Railway Express board, and time and again, we have 
seen--particularly with our Fredericksburg line--that far and 
away, the majority of folks coming there are outside of 
Fredericksburg, coming in from even further outlying 
communities, and many folks are willing to have the opportunity 
to get on board that system, but few are willing to pay. And I 
guess the real issue is expanded membership could be a fine 
thing, but membership would have its price.
    Chairman Tom Davis. I think many will come, but few will 
pay. And the outlying jurisdictions are the most reluctant to 
pay. It was just on the bond referendum where the 
transportation money would have gone in the outlying 
jurisdictions, and they were the ones that voted most 
overwhelming. That is, of course, what drives a lot of people 
to move further out is the tax burden.
    Mr. Kauffman. And one of the things, also, if I could just 
add to that, Mr. Chairman, was certainly the gas tax revenue 
issues; that was one of the captured items that prompted a lot 
of the interest on the part of some of the outlying counties 
with VRE. I do not know how, again, any tax instrument would be 
viewed since any form of tax instrument is often viewed as 
anathema the further out you go.
    Chairman Tom Davis. That's right. On the other hand, they 
are asking Fairfax to pump a lot of money into the system and 
provide parking places for commuters from other counties that 
are coming in here; and you get taxed to the max, I mean, it is 
just--OK.
    Any other comments on that? Dick, I do not know if you have 
any comments. I guess you would probably like as many payers as 
you can get, wouldn't you? It is an easy shot for Dana on this 
because he is from Fairfax; I have Prince William in my 
district, too, so I was very careful how I word it.
    But I think we have to understand here that it is 
affecting--a lot of people are using this from outside of the 
jurisdictions that are paying for it.
    Mr. White. And it is getting bigger and bigger as the 
commutes go longer and longer. I mean, the Washington Post 
story recently has clearly vividly illustrated that people in 
this region seem to have a tolerance twice as much as the rest 
of the citizens of our country to live further away from their 
jobs and to spend more time commuting to those jobs, which 
means, in our case, we are getting more and more of our 
ridership coming from outside of our Compact jurisdictions, 
which means that all of our Compact jurisdictions are 
subsidizing, to some extent, the citizens that live in other 
counties outside of the Compact; and there is no current way of 
capturing that other than through the fare revenue itself, but 
there is no subsidy way to capture that phenomenon which is 
growing.
    Chairman Tom Davis. And, in fact, your fare revenue capture 
is one of the highest in the country, isn't it, in terms of 
recovery rest?
    Mr. White. We are the second highest to New York City, yes.
    Chairman Tom Davis. Mr. Millar, any comment on that?
    Mr. Millar. If I may make a couple of comments on this.
    First, the experience around the country is the larger the 
taxing area gets, you get some unintended consequences, they 
are logical, but unintended. The argument today I understand 
certainly, people come from there, they get on here, they go 
there, they ought to be taxed there. Well, everybody else who 
lives there and doesn't make that trip then says well, if I am 
paying that tax, I ought to get some additional amount of 
service. And we have many examples where the regional transit 
systems have outrun their tax base, when originally it was all 
done for the best of intentions of including everybody in it. 
So we certainly need to be very careful about how that goes.
    The other thing one might think about is the States and the 
role of the States in this. If truly the commuters' shed grows 
at least as far as it is from my understanding--which is very, 
very far now from the core counties and the District--many 
places have looked at what the States might do in that regard 
and have the States act as a surrogate, in essence, for these 
other outlying--so you get combinations where the State puts in 
an amount of money, the core counties put in an amount of 
money, and you do it in that fashion.
    Chairman Tom Davis. Right. Well, that is a problem our 
State legislators are going to have to face up to.
    Let me ask you this, Mr. Millar, too: You talked about the 
Americans With Disabilities Act requirements for paratransit. 
What is that costing the system? Is there a more effective way 
to do it? And are there any ongoing Federal efforts to 
coordinate transportation services offered by Human Service 
programs?
    Mr. Millar. The cost of complimentary paratransit is 
usually the fastest growing part of a major transit system's 
budget over the last 10 or 15 years. I had some statistics in 
my testimony. In general, now we are spending over 8 percent of 
the operating cost nationwide on that service; very important 
service for the people who use it and the communities in which 
they live, to be sure, but a nightmare for the public transit 
budget. When you take it and you begin to look down at what is 
going on with individual transit systems, you see costs that 
have been rising in excess of 100 percent. Well, there is 
simply no tax base of--no local tax base, no way that kind of 
cost can overrun a budget. Now, yes, we are in the early years 
of that, so we are probably on a steeper slope than we will be, 
say, if we were having this discussion 5 years from now, but 
still, it is a major and growing part of the budgets.
    Chairman Tom Davis. My last question: Does ADA require 
curb-to-curb service?
    Mr. Millar. Yes, sir, it does.
    Chairman Tom Davis. So that is basically an unfunded 
mandate.
    Mr. Millar. Yes, sir, it is; absolutely.
    Chairman Tom Davis. So we have to look at ourselves on 
that. That is also this jurisdiction, though, as we look at 
that, and that is also an issue.
    OK. Thank you. I think you have clarified it.
    Ms. Norton.
    Ms. Norton. Thank you, Mr. Chairman.
    I want to quickly get through a set of questions. The 
reason I pressed the--I got only one question last time because 
I am interested in solving a problem.
    Don't expect elected officials to solve the problem of 
dedicated funding, they are born cowards, they are not going to 
get up and say raise anybody's taxes. So we have to get at 
ways--and I have looked at some of what you have recently done; 
for example, it was either in your testimony or I may have read 
it before I came here, that 58 percent--that is almost 60 
percent of the people in this region--say we need a ``new way 
to raise funds for Metro.'' I take that as we are part of the 
way there.
    You haven't done a fare increase in a long time. I am going 
to say to you, Mr. Corbett, the only problem I have with an 
actual voting--I am not sure what that does, one person--but 
the only problem I have with that--and this may sound strange 
coming from me--is if anything, this system needs a regional 
constituency for hard issues. And it is easy enough to 
represent the riders--I love to throw eggs, you know, at the 
system; and it seems to me that person, for example, if the 
notion of a fare increase came up, hey, this guy or woman would 
try all they could to say don't do that, you haven't done it 
for 8 years, or whatever.
    Please don't take me to say I believe in fare increases, 
the poorest people in the region live here and would be hurt 
most. But I know this much, if you do what PEPCO is now doing, 
an 18 percent rise, because we have not had a rise in PEPCO for 
so many years, you don't help the poor people in my region.
    So I have an open mind on that. I like what they have done, 
have you come and speak at the board meetings. I am not sure 
what more harangue on the board would do with a--I am in the 
Congress of the United States, and I see what people who 
operate from the narrows of constituency, I see what they get 
us. Tom Davis and I try, in the way we approach issues, to step 
back and say--sometimes one of us has to give up and the other 
one not; so I just put that on the record.
    Let me cite to you a poll that came forward, reported in 
the Washington Post, that most people prefer tolls to taxes. 
You know what? The Washington Post gave them a choice; this had 
to do with roads, and it said tolls or taxes. If you had said 
do you want tolls, 98 percent of course not; if you had said to 
taxes--so we are not framing the issue well.
    Has, for example, Metro ever done a survey to find out 
whether or not people would prefer tax increases--fare 
increases, rather, to fund more cars or further delays? I mean, 
you have to put the real alternatives before people. Or have 
you ever asked in any survey whether you would prefer a 
dedicated sales tax or further delays? I mean, have you done 
any surveys? You are going to have your public coming in one 
way or the other, what surveys have you done to indicate that 
people have preferences one way or the other, the way we now 
know they have preferences for tolls over taxes when it comes 
to roads?
    Mr. White. Ms. Norton, I don't think the Metro organization 
itself has done those kind of surveys, I mean, we certainly do 
a lot of surveys in terms of customer satisfaction, 
measurements and things of that measure, but we have not--
certainly historically--taken the step to kind of present those 
kinds of choices because Metro does not have its own funding 
source, we are a product of the State and local governments 
that fund us----
    Ms. Norton. I understand; I understand, Mr. White; I 
realized that the answer was probably no.
    You hear me giving you a suggestion. This does not have to 
do with funding, this has to do with grooming the public fairly 
to understand what their alternatives are, and I have to tell 
you, I don't think the public has any idea. We are going to try 
to do our job, so are you. I am going to have to try to quickly 
get through this set of questions, unless somebody else has 
something to add there.
    Mr. White. Mr. Millar, I think, has a good national 
perspective on it.
    Mr. Millar. Yes. To your point about people understanding 
what their choices are, I think there are lessons to be learned 
from other parts of the country.
    On November 2nd, when we were re-electing the President, 
when many folks were arriving in the Congress on a no-tax 
general view of life, voters around the country approved 24 of 
31 ballot initiatives that were presented to raise their own 
tax to fund public transportation systems. So we have learned 
some lessons about designing good programs, about bringing the 
public into that design, about helping, educationally, for the 
public to understand what the benefits are, and now delivering 
to the public those benefits. One of the key parts of the 
dedicated funding is the ability to actually follow through on 
the promises that are made. So I would be happy to work with 
them on that.
    Ms. Norton. All I can say, Mr. Kauffman and Mr. White, is 
you need to have somebody do a serious analysis of how they 
were able to do what nobody in this region--it may have 
something to do with the fact that we are a multi-state region, 
I don't know if that contributes to it, I won't dwell on that--
but we need to understand how come that happened across the 
country, particularly in this atmosphere, no-tax atmosphere.
    And again, I go back to the notion that nobody understands 
what you use the money for. Now they know how to complain, Mr. 
Corbett can tell you, about elevators that don't run, 
escalators that break down, too much crowding; we love that. 
And you deserve it if you don't come back at people with some 
way for them to understand why that occurs.
    Could I ask, what is the percentage of Federal funding that 
is now in--goes to Metro, approximately? How much Federal 
funding already goes to Metro as a result of simply the TEA 
21--I guess it would be--type funding.
    Mr. White. I will try and answer that question, Ms. Norton, 
in a few different ways by referring to the charts there.
    In our current budget, capital and offering in the Federal 
contribution is 13 percent, and that is largely because the 
Federal Government does not participate in weighing in the 
average jurisdiction----
    Ms. Norton. Is that more or less what the contribution 
would be in the average jurisdiction?
    Mr. White. No.
    Mr. Millar. No.
    Ms. Norton. Mr. Millar.
    Mr. Millar. In my experience, the customers here pay a much 
higher percentage than is normal, I would say, in that regard.
    Ms. Norton. I am asking about Federal funding.
    Mr. Millar. In Federal funding, in the large systems there 
is very little Federal funding for operations, there is a great 
deal of funding for capital expenditure; and again, it varies 
all over the lot, depending on where they are in their cycle.
    Ms. Norton. Mr. White, what percentage of the passengers 
for Metro originate in D.C.?
    Mr. White. The chief financial officer has given me a note, 
and it says 45 percent of our bus and rail riders are D.C. 
residents; and that is largely because we have a very extensive 
bus network; and of course, the District doesn't even have a 
school bus system, so we provide some of those services for the 
District residents; but 45 percent in combination.
    Ms. Norton. We are very proud of the New York Avenue 
subway. I was able to get some funding here in the Federal 
Government, and D.C. stepped right up to the plate, and the 
private sector recognized the benefit. Does this model have any 
future elsewhere in this region?
    Mr. White. I hope so, Ms. Norton, because I agree with you, 
I mean, it was very, very innovative and very, very successful. 
In this instance, there was a partnership that came together 
that recognized there is a special benefit to be made by 
putting that infill station in there to help that land realize 
its potential and the community to realize its potential. The 
landowners were willing to tax themselves through an 
assessment, about one-third of the cost of that station, 
recognizing they are going to benefit from having a Metrorail 
station put down there. The District of Columbia contributed 
another third share, and a special appropriation of the 
Congress contributed another third share, at least those were 
the original shares initially.
    So this motion here, I think it is a notion of value 
capture, and I think it is something that needs to be talked 
about more in the future, is that there are certain people in 
our metropolitan area who benefit from a large scale capital 
investment, and perhaps there needs to be some more value 
capture around that. And another notion of that, and one that 
has been talked about a little bit, is maybe those employers 
who have--who are in office buildings that are within proximity 
of Metrorail stations, maybe there should be some additional 
incremental assessment recognizing the extraordinary benefit 
that they receive for being located that close to a Metro 
station.
    So the notion of value capture and private benefit I think 
is something that needs to be explored more in the future, and 
is something that came out of the New York Avenue station.
    Ms. Norton. Finally--I do not have any other questions--I 
note that in Mr. Kauffman's testimony, he said there were no 
obvious substantive or geographical expansions that are 
necessary at this time. I mean, when you hear about all the 
congestion on the road, what you are saying is you can't even 
begin to think about bringing some of those folks in by Metro; 
you certainly can't mean that they are not necessary, with 
people hanging on the roads forever.
    And finally let me just say, in terms of how--I have 
mentioned the Metro, the New York Avenue subway, and I am not 
sure--obviously that works for expansion, but I want us to 
think about it even as to whether or not it has some 
application for the system as it is now operated. And I do not 
know what the win-win there, but I wish we would think about 
that model, using our powers of analogy, see if there is some 
way to do something similar. The Federal Government, I mean, we 
were clear to the Federal Government, you need this stop 
because you need this land nearby. If we are not expanding, we 
need to think of how Tom and I could present this to the 
Federal Government so that they would understand, as they did 
with the New York Avenue Metro subway, that they were getting 
something out of it.
    And let me tell you what I think the real model in how to 
operate really is. The District of Columbia, in building this 
subway stop, contributed $2.1 billion, more than any other part 
of the jurisdiction. How did they do it? It transferred 
interstate highway funds in order to do it, and that meant that 
it was making a larger contribution than Maryland or Virginia 
toward the construction of the Metro rail system. We knew what 
we had to gain, it was absolutely clear to us, we knew that 
highways should not be the wave of the future, particularly in 
the District of Columbia.
    They have become the wave of the future since 1967, so we 
have to somehow figure out what to do with the arrangement of 
funds and how to keep this competition for funds between 
highways and Metro from continuing so that people really do do 
what they want to do, which is to take Metro if they can only 
find a way, one, to get Metro out there, and two, to get on a 
Metro car, even if they were within the Metro area.
    Thank you very much, Mr. Chairman.
    Chairman Tom Davis. Mr. Van Hollen.
    Mr. Van Hollen. Well, thank you, Mr. Chairman, again; thank 
all of you for your testimony today.
    As I understand what you are saying, compared to other 
Metro systems in the country, in the WMATA system, riders 
generally are paying more. The Federal Government is paying 
more for the reasons we have stated historically. So the one 
component in the equation that is paying less relative to other 
Metro systems is the local jurisdictions; is that right, in 
terms of their input?
    Mr. White. I don't know if I would go quite that far, Mr. 
Van Hollen.
    In terms of--I think the distinction here is the extent to 
which State and local governments empower their transit 
system--in our case, Metro--to get the first dibs on money 
without having to put it in competition with other needs 
assessments that State and local governments do through their 
annual appropriations process. That is where we come up short. 
And we are shorter than anybody else in the country, and that 
is a major limitation. But the extent to which we do get 
contributions from State and local government, they are pretty 
sizable, and actually over the last set of years, are higher 
than what their historical proportion has been to the funding 
shares of the system.
    Mr. Van Hollen. Right. I understand. I am just trying to 
compare it relative to other systems in the country, not 
historically within this system. If the riders here are paying 
relatively more and the Federal Government is paying more, it 
just seems to me that the other systems--somehow the local 
jurisdictions are paying less compared to other regions--as a 
percentage, not that they are not paying a lot.
    Let me get on to the issue of funding and look at 
alternatives to dedicated funding source; and I think the 
proposal you floated is a very good starting point. But as you 
know, it is also complicated by the fact that we are talking 
about multi jurisdictions and a number of other issues.
    Is there any way to essentially get the different 
jurisdictions to make a legally binding commitment to the WMATA 
system for a particular share of capital costs going into the 
future that you could hold them to legally, despite their 
annual appropriations process, and let the jurisdictions then 
figure out on their own how they go about funding it? Maybe 
they will fund it out of their existing allocation, maybe they 
will fund it out of, you know, additional dedicated revenue 
source they find, maybe they will add it out of general 
revenue; but is there a way to do that so that you can hold 
them legally to that commitment? And then you get everybody 
together and say, OK, we are on board.
    Mr. White. We did find that way recently in the form of the 
Metro Matters funding agreement, where we have a legally 
binding 6-year commitment where everybody has a share, without 
there being a specific identification of how each jurisdiction 
is going to come up with its share, but they put their 
signature to a legally binding agreement that is subject to the 
annual appropriation process. So yes, Mr. Van Hollen, that is 
an option.
    I think the Blue Ribbon Panel--and Mr. Downey might want to 
comment on this--they recognize it as certainly not the most 
preferred option. The most preferred option, and the one that 
they believe has the greatest opportunity for success, is some 
sort of regionally implemented funding mechanism that gets 
applied and raises money regionally, but they are also quick to 
identify there are other options to that, including the one 
that you said, sir, which would be some sort of subregional 
allocation, and then left up to each of those jurisdictions to 
figure out how to honor that.
    Mr. Downey. I would only add to that that the panel also 
felt whatever was committed to regionally ought to be matched 
federally.
    Mr. Van Hollen. All right. Thank you.
    Mr. Chairman, I don't have any more questions. Thank you.
    Chairman Tom Davis. Well, thank you very much. Let me just 
thank this panel. I think we have laid an important groundwork 
today as we move forward with what I hope will be an 
authorization bill we can present. We hope to be able to call 
on you for your guidance and further information as we move 
forward. This has been an important hearing----
    Ms. Norton. Mr. Chairman, could I----
    Chairman Tom Davis. Yes, Ms. Norton.
    Ms. Norton. There was one question I didn't ask. You and I 
are on the Homeland Security Committee. I wondered how much 
additional money has had to be put in the system for homeland 
security.
    And Mr. Chairman, I think that one option for us 
particularly, since homeland security money is used largely for 
capital funding, may be to make--to draw to a higher level of 
the Federal Government not only the money that is being spent 
because of post-September 11 problems, but the money that 
simply must be spent on security, capital funding security 
matters for Metro for the foreseeable future. But anyway, what 
is the number, if you have one?
    Mr. White. You make a good point, Ms. Norton; and I will 
give the local perspective, I know Mr. Millar might be able to 
add in, weigh in a bit on the national side as well.
    We did have some good success initially, immediately in the 
aftermath of September 11 where we were able to receive a--
special appropriations of the Congress through several separate 
committees of $39 million, and then the administration released 
$10 million of finding that was under its control for a $49 
million investment that helped us to shore up some of the areas 
of vulnerability that we had in the system. However, the income 
stream that has come out of the Department of--that was before 
there was a Department of Homeland Security, and when the 
Congress created the Department of Homeland Security, since 
then the funding sources that have come out have been extremely 
small in terms of the amount of money that finds its way into 
transit. Metro has only received about $7 million of homeland 
security funding over the first two appropriations cycles.
    So clearly, transit has been taking a seat nationally--
taken a back seat nationally as a matter of priority as to how 
the Federal Government makes its investment into transportation 
security; and there is clearly a lot more that needs to be 
done. We have a whole lot of identified needs. The need for our 
capacity, I think as implied in your question, Ms. Norton, is 
related to homeland security.
    Chairman Tom Davis. I mean, the problem with homeland 
security, too, is that the high-target areas really don't get 
the appropriate amount of money; this money is spread out and 
it becomes a congressional grab bag. So, you know, Bullfrog 
Corner will say we need money for our first responders here 
where it's--probably terrorists have never heard of it, and 
some of the other areas suffer. But that is what happens with 
congressional funding formulas, as you know.
    Mr. White. And the money that the Congress has 
appropriated, largely it has been left to the discretion of the 
Department of Homeland Security to kind of allocate it out, at 
least the transportation component or the transit component of 
it. And thus far it has gone out on a formula, and it has had 
the--the consequence of what you say, Mr. Chairman, is it kind 
of goes out to everybody and it is not really risk-based. And 
clearly everybody needs a baseline of support; all of our 
transit systems across the country have to have some minimum 
baseline of support and capability, but there are systems that 
have higher risk, and so far that hasn't been reflected in 
funding decisions.
    Chairman Tom Davis. Let me just end with this question I 
will ask you, Mr. White, but if anybody wants to answer it.
    I mean, ultimately to be successful in getting additional 
money, the taxpayers have to say, what assurances can we get 
that the money is going to be well-spent? That is ultimately 
the burden that we have whenever we go out to our voters and 
taxpayers and ask them for additional money.
    In this case, in going to Congress for additional money, 
they are going to say what additional steps have we taken. We 
have talked about the representation issue, in fact we may have 
some presidentially appointed, Federal members aboard, it could 
be riders or whatever; but ultimately, that is the question you 
are going to have to be able to assure Members of Congress and 
voters, who will both be participating in this.
    Mr. White. I understand, Mr. Chairman; it is the right 
question for people to ask. There is an issue of accountability 
that we must be able to demonstrate that Mr. Kauffman, in his 
opening remarks, I think really stressed that issue. Both he 
and I covered in our testimony the litany of things that we are 
doing to respond to, quite frankly, a very tough year for us 
last year, I think we are--at the table here, those in our 
organization, we are the first ones to admit we did not have a 
good year last year, and there were things that happened that 
draw questions to the service we are providing to our 
customers. I think it has stabilized and become better lately; 
we certainly hope that is a byproduct of the corrective action 
plans we are putting in.
    Certainly when it comes to money and the extent to which 
anybody is considering making extraordinary allocations of 
money, there needs to be a contract associated with that, there 
has to be a contract of accountability so that it should be 
absolutely clear what the money is going to buy. And that was 
one of, I think, the power of the Blue Ribbon Panel's report is 
it was very specific, I mean, it was very specific about what 
an investment would get, and it identified over what period of 
time that investment would be delivered.
    So I think we, in the Metro organization, would be the 
first ones to salute the extent to which anybody is willing to 
put additional funding on the table to make it very--as a part 
of a contract, this is what we are going to deliver to the 
citizens, this is what people can expect to get so there is no 
over-expectation or under-expectation of what that investment 
is going to bring.
    Chairman Tom Davis. Well, thank you all very much. Mr. 
Corbett, thanks for your perspective on this. Mr. Downey, you 
bring a wealth of knowledge with you, as you do, too, Mr. 
Millar. Mr. White, it is good to see you back. And Dana, good 
accounting for yourself in your first appearance, and we hope 
to see you again.
    Mr. Corbett wants to get the last word here.
    Mr. Corbett. And it will be a brief one.
    We very much, as a panel, appreciate this hearing. In 
watching Mr. Kauffman and all his predecessors, they are 
absolutely lucid on the need for a funding source for Metro. 
This panel of witnesses cannot provide the solution to you, and 
that is why we think we need a bigger room with different 
players, and we encourage your participation in that process.
    Chairman Tom Davis. Thank you very much. We will give you 
the last word. The hearing is adjourned.
    [Whereupon, at 12:01 p.m., the committee was adjourned.]
    [Additional information submitted for the hearing record 
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