MOORLACH UPDATE — Good Deals? — March 25, 2014

The OC Register’s editorial board supported what would be this morning’s unanimous Board vote for the Orange County Employees Association contract in the first piece below. When more than 90 percent of the County’s general fund (net county costs) budget revenues come from property taxes, that limits the growth in annual budgets by some 2 percent per year. And when the bulk of employee cost increases are due to higher employer contributions into the defined benefit pension plan, it does not leave room for pay raises. Consequently, trying to keep total compensation costs level over time is not an easy goal, but must be pursued for proper management of the overall budget.

The second piece below is from the Voice of OC. It’s not too often when a good number of the Orange County Transportation Authority (OCTA) directors want to chime in on a topic to sing its praises. One would have thought that they were all given short scripts to read. For me, I just couldn’t see what all of the adulation was about. Either I’m not catching the streetcar vision or the significant costs of ripping up streets to install rails is grating to this Certified Public Accountant. Public transit is heavily subsidized. So this fiscal hawk wants to keep capital costs to a minimum. Maybe it’s because I’m trying to stay consistent. I was an opponent of the proposed CenterLine project. I’m currently not amused with what I see as a nontransparent streetcar implementation plan in the city of Anaheim. And although this project does not go forward without assistance from Washington, D.C., I still see Federal funding as taxes coming out of someone’s earnings that must be respected. And with a Federal government that is running massive annual budget deficits, Federal funding only means an ever growing national debt. So, forgive me for my apprehension and fiscal skepticism.

Good-enough deal for O.C. employees

The Board of Supervisors today was set to approve a new contract with 12,000 workers represented by the Orange County Employees Association, a deal that took two years to reach.

The contract has been stalled over the issue of raises, which the supervisors said weren’t in the budget. OCEA-represented employees haven’t received an across-the-board raise in five years, although the county has significantly increased contributions to employees’ health insurance.

Employees are set to receive a 1.25 percent salary increase on top of a 1.25 percent one-time bonus. Some of the costs will be mitigated by “increasing employee health care costs, by reducing performance pay and other savings,” a Register story said.

In all, with those reductions and with a majority of the funding coming from state and federal revenue, the county’s net cost increase is projected to be $4.1 million over three years.

We would have preferred no additional general fund expenditures, and the cut in performance pay is another concern. Still, “Overall, I don’t think anyone is happy, so I guess that is good,” Supervisor John Moorlach told us.

That may be the best news emerging from the protracted stalemate: the evolution of a welcome atmosphere of compromise, which, hopefully, will continue with negotiations with other employee groups.

Cost Concerns Now Baggage for Santa Ana Streetcar Plan


A major streetcar project in Santa Ana and Garden Grove got another seal of approval from local transportation officials Monday, amidst public questioning about its large – and growing – price tag.

Cost estimates for the streetcar are now pegged at a minimum of $238 million. By comparison, providing increased bus service along the same route – with traffic signal priority to buses – is projected to cost just $16 million.

At Monday’s Orange County Transportation Authority board meeting, Director John Moorlach wondered aloud what the advantages are of a streetcar system that costs well over $200 million versus an enhanced bus option.

“What makes it distinctively different from a bus? What am I getting that makes it unique?” asked Moorlach, who is also a county supervisor.

Santa Ana Mayor Miguel Pulido, who has been an outspoken advocate for the streetcar, replied that it would use some areas not currently available to buses – namely the abandoned Pacific Electric Railroad right of way.

However, it appears that buses could also use that area if it was paved.

Responding to the same question, Santa Ana City Manager David Cavazos said the streetcar offered more certainty and predictability for riders.

Light rail is “very, very popular,” said Cavazos.

He also pointed to the streetcars having priority at traffic signals as another advantage. However, rapid transit buses could also utilize such technology.

The project also drew scrutiny from OCTA Chairman Shawn Nelson, who questioned why the streetcar’s cost has grown from roughly $23 million per mile in each direction to $29 million.

While not directly addressing how that cost rose, agency staff replied that the project still falls slightly below the midpoint cost for other light rail systems.

Most transportation board members, meanwhile, support the streetcar project and are eager to get construction underway.

Director Lori Donchak, who is also a San Clemente councilwoman, described it as an “incredibly well-managed project.”

“I think it’s gonna be a great starter project,” added Director Greg Winterbottom, a past political aide to former county Supervisor Ralph Clark who has served as OCTA’s public member for the last 20 years.

The streetcar line could be approved by the end of this year, officials said, with at least three years of construction before opening.

Its environmental approvals are coming up in the next few months, including a 45-day public comment period.

“We all have urgency. We all have enthusiasm,” Pulido said of the board, calling it “a very strong project.”

Pulido himself drew scrutiny from a county grand jury for secretly working to award the streetcar’s $5 million planning contract to a firm that gave thousands of dollars to his re-election campaign.

The company, Cordoba Corp., had been the lowest-ranked company for the job, and one of its subcontractors ended up running $488,000 over-budget.

It also later emerged that Cordoba hired a project manager who had served prison time for bribing public officials.

One end of the streetcar line would start at Santa Ana’s train station, then travel west roughly along Santa Ana Blvd. through downtown Santa Ana and the county’s Civic Center, before turning northwest and ending at the corner of Harbor and Garden Grove Blvd:

Several of the proposed route’s western stops appear to be in relatively low density areas, including the final stop in Garden Grove:

When planned with strong input from local community members, new public transit lines can be part of a strategy to create walkable communities that advocates say boost economic development and improve residents’ health, among other benefits.

The approach is often known as transit-oriented development.

In Phoenix, for example – where Cavazos was the city manager before coming to Santa Ana – a new light rail system was guided by a community-based planning effort known as ReInvent PHX.

That effort encouraged local residents and business owners to be actively involved in shaping how the streetcar stops and surrounding areas were planned and developed:

The thinking is to bring together various stakeholders to plan and create more appealing places around transit for people to shop, eat, live and hang out:

In Santa Ana and Garden Grove’s case, it’s unclear if an extensive civic engagement effort has been undertaken as part of the transit planning. The issue wasn’t addressed during the board’s discussion on Monday.

Public transit now appears to be making a comeback across the nation, with transit usage last year reaching its highest levels since 1956, according to the American Public Transportation Association.

Recent studies also suggest that a growing number of young professionals are seeking to live near public transit.

The debate over transit investments also comes as traffic congestion continues to get worse on many local freeways and streets.

At the same time, funds for freeway projects are dwindling at the state and national levels.

The federal Highway Trust Fund is reportedly close to going bankrupt, with U.S. Transportation Secretary Anthony Foxx saying it could start “bouncing checks” this summer.

Federal law is also now mandating that traffic be sped up in congested carpool lanes.

And at the state level, Caltrans has been described by OCTA board member Todd Spitzer as being "way in the hole" on maintenance funding.

The state’s highway system needs about $8.2 billion in maintenance each year, according to Caltrans, yet only about $2 billion per year is expected to be available.

“The percentage of lane miles of highway pavement in a distressed condition, which is pavement with significant rutting, cracking, potholes, or other signs of deterioration, is projected to increase during the next 10 years,” the state agency wrote in a report last year.

As OCTA officials confront those challenges, they’ve suggested putting toll lanes on freeways or requiring at least three occupants for a car to drive in the carpool lane.

Moorlach, meanwhile, has suggested ramping up bus service on freeways, though that idea hasn’t gained traction among his colleagues.

You can contact Nick Gerda directly at ngerda and follow him on Twitter: @nicholasgerda.

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