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RAIL MANAGEMENT COMMITTEE MEETING

FEBRUARY 4, 2009 1:30 P.M.

101 NORTH FIRST AVENUE 13TH FLOOR – BOARD ROOM

PHOENIX, AZ 85003

February 2, 2009 REVISED To: Chairman Fairbanks and Members of the Rail Management Committee From: Richard J. Simonetta, Chief Executive Officer Date: February 4, 2009 Time: 1:30 p.m. Location: METRO 101 N. First Ave., 13th Floor Board Room Phoenix, AZ 85003 Please park in the garage in the US Bank Building (enter from Adams Street) and bring your parking ticket to the meeting as parking will be validated. Bus passes will be provided to those using transit. For those using bicycles, please lock your bicycle in the bike rack in the garage. Rail Management Committee members may attend the meeting by teleconference. If you have any questions or need additional information regarding attendance by teleconference, please contact Gina Frackiewicz at (602) 322-4455.

Item Action Requested

1. Call to Order

Call to the Audience Information 2.

A 15-minute opportunity will be provided to members of the public at the beginning of the meeting to address the Rail Management Committee (RMC) on all agenda items. The Chairman may recognize members of the public during the meeting at his/her discretion. Up to three minutes will be provided per speaker.

3. Minutes Action

Summary minutes from the December 3, 2008 RMC are presented for review and approval.

Chief Executive Officer’s (CEO) Report Information 4.

Rick Simonetta will brief the RMC on current issues and project status.

Rail Management Committee Agenda February 2, 2009 Page 2 of 4


Consent Agenda

5. Approval of Consent Agenda Action

The RMC is being requested to take action on the Consent Agenda. Committee members may request that items be removed from the Consent Agenda.

Items Proposed for Consent Agenda

5a. Geographic Information System Services – Contract No. LRT-08-102-GIS

Consent

Staff is requesting that the RMC recommend that the METRO Board (Board) authorize the extension of the contract for Geographic Information System Services LRT-08-102-GIS for Task Order 002. Please see information attached for Agenda Item 5a for additional information.

5b. Northwest Extension – Engineering Services Contract Amendment

Consent

Staff is requesting that the RMC recommend that the Board authorize budget contingency adjustments to the AECOM Transportation (DMJM Harris, Inc.) contract contingency from $750,000 to $944,738.27. This increase in the contract is for additional engineering services for the Northwest Extension Engineering Services. Please see information attached for Agenda Item 5b for additional information.

5c. Fiscal Year 2010 Federal Appropriations Request Information

Staff is requesting that the RMC recommend that the Board approve a listing of METRO projects to be forwarded to the Arizona Congressional delegation for inclusion in the Fiscal Year 2010 Federal appropriations process. Please see information attached for Agenda Item 5c for additional information.

5d. Reauthorization of the Safe, Accountable, Flexible, Efficient, Transportation Equity Act – A Legacy for Users (SAFETEA-LU)

Information

Staff is providing information to the RMC on public transportation policy and project requests for the Reauthorization of the Safe, Accountable, Flexible, Efficient, Transportation Equity Act – A Legacy for Users (SAFETEA-LU). Please see information attached for Agenda Item 5d for additional information.



5e. METRO Customer Policies Information

Information is being provided to the RMC regarding policies that apply to the METRO light rail system and its passengers. These policies are meant to supplement the ordinances that have been enacted by the Cities, as is done in the bus system. Please see information attached for Agenda Item 5e for additional information.

Regular Agenda

METRO Board Resolution Action 6.

Staff is requesting that the RMC recommend that the Board approve a resolution requesting that the Maricopa County Sheriff’s Office reconsider a plan to transport inmates on the METRO light rail system. Please see a draft resolution attached for Agenda Item 6 for additional information.

7. Fiscal Year 2009 Mid-Year Budget Adjustment

The RMC is being requested to recommend that the Board authorize updates to the Valley Metro Rail (METRO) Operating and Capital Budget for Fiscal Year 2009. Please see information attached for Agenda Item 7 for additional information.

Action

8. Regional Fare Policy

Valley Metro/RPTA staff will present information related to the regional fare policy Please see information attached for Agenda Item 8 for additional information.

Information

9. Regional Public Transportation Authority (RPTA) / METRO Consolidation

The METRO Board requested that an item be added to the agenda to discuss possible consolidation of RPTA and METRO. The item has been added for discussion and possible action by the RMC. No additional information is attached.

Discussion and

Possible Action



10. Issuance of Bonds to Fund Regional Assets

Staff is requesting that the RMC recommend to the METRO Board to authorize staff to work cooperatively with the RPTA to draft the Authorizing Resolution and Preliminary Official Statement for the Spring 2009 Bond Issue for the purpose of funding the Regional Asset Reimbursements due to METRO Member Cities. Please see information attached for Agenda Item 10 for additional information.

Information and

Possible Action

11. Future Rail Management Committee Agenda Items Information

The RMC may request consideration of future agenda items. No additional information is attached.

12. Adjournment Action With 24-hours notice, special assistance can be provided for persons with sight and/or hearing impairments. Call 602-254-7245 (voice) or 602-261-8208 (TTY) to request accommodations. If you require information about this meeting in alternate formats, please call the METRO hotline at 602-254-RAIL.

AGENDA ITEM 3

Minutes

December 3, 2008

101 North First Avenue 13th Floor – Board Room

Phoenix, Arizona Management Committee Members Present Frank Fairbanks, City of Phoenix Jyme Sue McLaren, City of Tempe Brent Stoddard, City of Mesa Jamsheed Mehta, City of Glendale Mike Normand, City of Chandler David Moody, City of Peoria Mary O’Connor, City of Scottsdale Dave Boggs, Regional Public Transportation Authority

1. Call to Order

Chairman Frank Fairbanks called the meeting to order at 1:40 p.m.

2. Call to the Audience

There were no public comments.

3. Minutes

IT WAS MOVED BY MARY O’CONNOR AND SECONDED BY JYME SUE MCLAREN AND UNANIMOUSLY CARRIED TO APPROVE THE OCTOBER 1, 2008 MEETING MINUTES.

4. Chief Executive Officer’s (CEO) Report

System Testing Update: Mr. Jay Harper, Director of Operations and Maintenance, provided an update regarding various system testing including: high speed, special event, substation control, customer service, ticket vending machine, ADA, and Tempe Town Lake Bridge lighting. All supervisors and operators graduated training sessions. The operators will be bidding on schedules. Mr. Simonetta spoke to the operators and stated they are impressed with the operations of the system. Some are transitioning from the bus to light rail and are very motivated. METRO will create a work environment to allow the operators to perform at their peak. METRO is customer, safety, and success oriented.

Rail Management Committee Meeting Minutes December 3, 2008 Page 2 of 7

Mr. Fairbanks made a reference to the first light rail and vehicle accident and inquired about the response time due to accidents and the rerouting of light rail vehicles (LRVs) to continue operating the system. Mr. Simonetta stated that because this was the first accident it received a high volume of media, police, and traffic which slowed the process of clearing the accident scene. Protocols have been established by the Incident Investigation Focus Group comprised of all the police departments and METRO. Future accidents should be cleared more efficiently and traffic and light rail operations should resume.

Mr. Brent Stoddard, Government Relations Coordinator, inquired how the public is notified of light rail delays. Mr. Harper stated that automatic train tracking system will announce the expected delays to the trains and at stations.

Security Agreements: All three cities have passed and signed the security agreements.

United Way Campaign Update: For the third year in a row METRO had a successful campaign and again this year METRO has partnered with Valley Metro/RPTA. This year’s goal of $40,000 was exceeded with a total of $42,000. Thank you’s were expressed to Kristin Roberts, METRO, and Katie Povie, Valley Metro/RPTA, who co-chaired this year’s campaign.

2009 RMC Meeting Schedule: A copy of the 2009 meeting schedule was distributed to the Committee.

Budget Summary Report: METRO is forecasting that the project will be within the budget and on schedule.

5. Approval of Consent Agenda

5a. Master Funding Agreement

IT WAS MOVED BY JYME SUE MCLAREN AND SECONDED BY JAMSHEED MEHTA AND UNANIMOUSLY CARRIED TO RECOMMEND THAT THE BOARD AUTHORIZE THE CEO TO EXECUTE THE LIGHT RAIL TRANSIT OPERATIONS MASTER COOPERATIVE FUNDING AGREEMENT WITH THE CITIES OF PHOENIX, TEMPE, AND MESA.

5b. Planning, Conceptual Engineering, and Environmental Studies Consultant for the I-10 West and Glendale High Capacity/Light Rail Transit Corridors

IT WAS MOVED BY JYME SUE MCLAREN AND SECONDED BY JAMSHEED MEHTA AND UNANIMOUSLY CARRIED TO RECOMMEND THAT THE BOARD AUTHORIZE THE CEO TO EXECUTE A CONTRACT AMENDMENT WITH URS CORPORATION TO IMPLEMENT PHASE 2 SCOPE OF WORK OF THE STUDY, FOR PLANNING, CONCEPTUAL ENGINEERING, AND ENVIRONMENTAL STUDIES FOR THE I-10 WEST HIGH CAPACITY/LIGHT RAIL TRANSIT


CORRIDOR. THE AMENDMENT TO IMPLEMENT PHASE 2 WOULD BE FOR A NOT TO EXCEED AMOUNT OF $4,198,216.

5c. Regional Fare Policy

This item was for information only and no action was requested.

Chairman Fairbanks stated that the proposed fare increase is related to the increases in operating costs for the regional bus system and the significant reduction of tax revenue. Light rail is effected only because it is part of the regional fare system.

Regular Agenda

6. Section 5309 Project Budget Adjustments

Mr. John McCormack, Director of Finance and Administration, and Mr. Brian Buchanan, Director of Design and Construction, presented information regarding Section 5309 contract budget adjustments to various project elements. The report focused on the specific cost savings in certain budget areas being transferred to cover other project costs. The overall project budget remains within the overall Full Funding Grant Agreement (FFGA) budget.

Chairman Fairbanks stated that the financial costs listed are projected into the future. Mr. McCormack stated that those costs are projected to 2012. The cost risks remaining could be claims and real-estate, but cost savings exist as well.

IT WAS MOVED BY JYME SUE MCLAREN AND SECONDED BY JAMSHEED MEHTA AND UNANIMOUSLY CARRIED TO RECOMMEND THAT THE BOARD AUTHORIZE THE FOLLOWING CHANGES TO THE SECTION 5309 PROJECT BUDGETS:

Decrease the Line Section 4 budget by $700,000 to $52,407,081;

Decrease the Park and Ride contingency by $700,000 to $22,938,792;

Decrease the Archeological Investigations/Hazardous Material Removal element by $200,000 to $7,372,689.

Decrease the Prior Rights utilities budget by $500,000 to $31,000,000;

Increase the Construction Administration Services line item by $1,970,336 to $56,281,460;

Increase the Project Reserve by $129,664 to $1,201,257.


7. Advertising Policy Update

Mr. John Farry, Director of Community and Government Relations, reported that the current policy on advertising does not allow advertising; however, when adopting the current policy in 2002, the Board requested that the design of the system incorporate the opportunity to allow advertising should a future Board change the policy. The current Board requested staff to provide additional information regarding potential revenues and inquire within the community of the potential interest in advertising on the system including co-branding of services. METRO received five proposals; three proposals included wrapping the LRVs (total of six vehicles). Proposed revenue for vehicle wraps = $642,000. Three proposals included advertising on station platforms. Proposed revenue for station advertising = $171,000. The level of interest expressed indicates that additional sales efforts will be required by staff on an ongoing basis.

Mr. Farry added that METRO has been contacted by the NBA and the Phoenix Suns proposing three vehicle wraps and two station platforms for a four week period for the NBA All Star Game. Mr. Farry stated the shorter duration of advertising with the Phoenix Suns would allow the opportunity for community reaction and determine potential market.

Mr. Simonetta stated that the trial period with the Phoenix Suns gives METRO an opportunity to develop a relationship with the Suns and also to preview the vehicles and the stations. Staff also needs to investigate the option of hiring a vendor to conduct the advertising sales and placement.

Chairman Fairbanks inquired about the proposal offered by the Suns and whether there was a timeline to negotiate a contract should METRO proceed with the concept. Mr. Simonetta stated the offer will be negotiated and METRO should act on this opportunity as early as next week.

Ms. McLaren stated that the offers received from the market do not reflect the total revenue potential. Holding off on advertising until we operate revenue service and evaluate our potential gives us a greater opportunity for achieving greater revenue. The Suns proposal gives greater opportunity for the community to experience the advertising without a long-term commitment. Ms. McLaren added that METRO needs to evaluate and consider every revenue generating opportunity.

Mr. Mehta stated that, as he indicated in previous discussions, he is opposed to any advertising, but now the station advertising is separated out and the station displays will be limited to cities that allow them. Mr. Mehta supports this proposal. The Suns opportunity gives the public and the respective Boards the chance to see the reaction from the public and the possible net revenues.


Mr. Mehta inquired about the potential risks associated with wrapping the LRVs. Mr. Simonetta stated that the contractor will bear all expenses and responsibility to restore the LRVs to their original condition.

Mr. Mehta asked about the ability to showcase the METRO identity prior to the vehicles being wrapped. Mr. Simonetta stated that the wrapped LRVs (three in total) would go into service the last week in January with almost a full month of all 50 vehicles having full exposure. The Board recommended the LRV advertising not exceed 20 percent of the fleet to preserve the image of the system.

Mr. Stoddard stated that the City of Mesa supports the station advertising with the cities that permit it. Also, due to the economic times the vehicle wrapping can be revisited and the Suns trial period is a great opportunity. Mr. Stoddard inquired if METRO is looking for a public reaction to the advertising. Mr. Farry replied that METRO is interested in seeing what type of response will come in. Mr. Simonetta added that METRO is interested in the public’s opinion. At least $1.3 million net revenue annually might be anticipated from advertising on the METRO system.

Mr. Jungwirth supported the NBA concept and added that it would expose other advertisers to the potential of advertising on the trains. Mr. Jungwirth also expressed his support of staff investigating the option of hiring a vendor to conduct advertising sales and placement due to the fact that from a management perspective it is a difficult task.

IT WAS MOVED BY JAMSHEED MEHTA AND SECONDED BY BRENT STODDARD AND UNANIMOUSLY CARRIED TO DIRECT STAFF TO NEGOTIATE FOR THE MAXIMUM REVENUE POSSIBLE WITH THE NBA AND PHOENIX SUNS TO ADVERTISE ON THE METRO SYSTEM BY WRAPPING THREE TRAINS AND AT THE 3RD STREET/JEFFERSON AND THE 3RD STREET/WASHINGTON STATION PLATFORMS FOR UP TO A SIX WEEK PERIOD AS A TRIAL ADVERTISING PERIOD TO USE AS A TOOL FOR FUTURE ACTION TO BE CONSIDERED AT A LATER TIME.

8. Art Program Overview

Ms. MB Finnerty provided an update and an overview of the METRO public art program. The art program budget was set at $6.3 million. The Regional Rail Arts Committee (RRAC) comprised of arts staff, artists, arts professionals, architects, and community members. The artist selections were a nation-wide Call to Artists with 300+ applications. The RRAC selected five station design team artists and one bridge design team artist. The design team artists collaborated in station design, created an identity for each line section, identified art opportunities at each station, and participated in short listing station artists.

The station artists selection process included the Station Art Review Committees (SARC) which worked with RRAC to select station artists. There were 28 artist/artist teams for 27 stations and 1 Bridge. Approximately 40% of the artists were local. The


review process involved the artists’ presentation of artwork at 30%, 65% and 95% to: METRO architecture, safety, maintenance staff; RRAC; SARC; at public meetings. The art work was shown to city arts commissions and various civic groups.

The finished art pieces include: integrated artworks paving, louvers, screens, entry walls, entry way canopies, stand alone artworks, and the Tempe Town Lake Bridge. A public art opening for artists and volunteers is scheduled for December 6, 2008.

Ms. O’Connor expressed her excitement about seeing the final art pieces incorporated on the METRO system.

9. Light Rail Ordinances

Mr. Mike Ladino, General Counsel, presented information regarding the recent adoption of ordinances in Phoenix, Tempe, and Mesa related to individual conduct required of persons riding the METRO. Mr. Ladino recognized METRO’s and member cities staff’s cooperation on a number of agreements including the Master Funding Grant Agreement, Security Agreement, and the Ordinances. The agreements and ordinances were approved by the respective member city councils and may be amended in the future if necessary.

Mr. Larry Engleman, Director of Safety, Security, and Quality Assurance, stated that the ordinances were developed by a committee chaired by Denton Casey, City of Phoenix Law Department. Participants of the committee included lawyers and police officials from member cities, and METRO staff. Eleven ordinances from light rail systems in the Western US and bus policies currently used in the Valley were surveyed and compared.

The ordinances have been adopted by the Phoenix, Tempe and Mesa City Councils and incorporated into City Codes. Ordinances are virtually identical with only minor wording differences and they apply to both bus and METRO. The cities of Tempe and Mesa ordinances allow contract security officers to write citations. The citations are civil and the fines start at $50.00 and go up to $500.00 at the discretion of the court.

There are three components to the ordinances: fare inspection (proof of payment fare enforcement system), public conduct (no smoking, no eating, audio devices must have earphones, service animals only etc.), and use restriction (person can be prohibited from riding transit for multiple or major infractions).

Ms. O’Connor asked if the ordinances will be posted in central locations. Mr. Engleman stated that the ordinances will be posted on the web, trains, and stations.

Chairman Fairbanks asked if the courts are aware and understand the ordinances and if the enforcement is complete. Mr. Engleman stated the committee has discussed this and METRO will ensure that the court administrators are informed of these ordinances.

Rail Management Committee Meeting Minutes December 3, 2008 Page 7 of 7 10. Owner Controlled Insurance Program (OCIP) Update

Mr. Ladino introduced Mr. Karen Frey, Ashton Tiffany Risk Management Consultant, and stated that the OCIP was approved by the Board two years ago. The risk managers and attorneys for the member cities met to review the insurance program prior to grand opening. Due to the number of METRO, city, and consultant staff involved in the operations phase of the program and in order to insure all those various possible risks, it makes sense to place all the risk in one basket to administer it and manage it more efficiently. All costs are within the 2009 budget. Mr. Ladino added that METRO has indications on all liability coverage by qualified companies.

Ms. O’Connor asked if the coverage applies to member cities only or administrative overhead? Mr. McCormack replied that the cost of the program is funded by the three operating cities.

11. Future Rail Management Committee Agenda Items

Chairman Fairbanks congratulated, thanked, and stated his highest admiration and regard for the METRO staff, city staff, and Rick Simonetta, for bringing this project on schedule and on time. The partnership among everyone has made this project happen.

Mr. Simonetta stated that this project required creativity, structure, trust, understanding of differences, and everyone has benefited from the process. The community has been well served by everyone working collaboratively. This was a team effort by METRO, consultant, and city staff.

Mr. Mehta stated that the Glendale Council directed Glendale staff to work with METRO staff and City of Phoenix on the Glendale Community Study involving light rail.

12. Adjournment

The meeting adjourned at 2:56 p.m.

AGENDA ITEM 5A

Geographic Information System Services

AGENDA ITEM 5A

To: Chairman Fairbanks and Members of the Rail Management Committee

Through: Richard J. Simonetta, Chief Executive Officer

From: Wulf Grote, Director of Project Development

Date: January 29, 2009

Re: Geographic Information System Services – Contract No. LRT-08-102-GIS

PURPOSE This memorandum requests that the Rail Management Committee (RMC) recommend that the METRO Board authorize the extension of the contract for Geographic Information System Services LRT-08-102-GIS for Task Order 002. BACKGROUND AND DISCUSSION A Geographic Information System (GIS) is a computer software package that links geographic information (i.e., where things are) with descriptive information (i.e., what things are like). It establishes a framework for collaboration and communication by providing a common frame of reference based on locations, which allows users within an agency to share information based on this attribute. METRO initiated Phase I of GIS implementation in January 2007 with a Notice to Proceed (NTP) for Task Order 001 to Jacobs Carter Burgess to provide GIS services. Jacobs Carter Burgess was selected as the highest ranked best value proposer for on-call Geographic Information Services. The initial task order included services to administer the GIS database, initiate data sharing agreements with other agencies in the region, provide technical support to GIS users, provide training to potential GIS users and assist in overall agency GIS implementation. Over the past year, the GIS consultant team has worked closely with GIS users of Project Development, Design & Constriction, Operations & Maintenance and Public Involvement Divisions. The users were provided with necessary hardware and software and also trained to use the GIS software. GIS data was collected by the consultant and stored in a centralized repository which was shared with METRO staff. Centralized data was continuously maintained by the GIS consultant, which helped in keeping data updated and accessible to everyone at METRO. Having the same data available to everyone has reduced instances of repetition and fostered better coordination between divisions.

Rail Management Committee Memo January 29, 2009 Page 2

Users from Design and Construction Division, for example, believe that centralizing all the information into one database increased efficiency by eliminating time spent on searching for data. Users have fruitfully applied GIS solutions to the Blue Staking process and are already realizing the benefits of the software which includes significant time savings in responding to blue stake ticket requests. Some users believe that the processing times have been cut down to 1/3rd of what it used to be. Project Development team members use GIS to analyze traffic patterns, study environmental impacts, identify engineering issues and produce maps. The Public Involvement team has the capacity to create and maintain stakeholder databases. Staff from Project Development, Design & Construction, and Public Involvement Divisions have had one-on-one interaction with the GIS consultant to create customized GIS solutions for their Divisions. As a result, the Public Involvement (PI) Division further intends to implement a stakeholder management system. This management system will provide an updated inventory of stakeholder contact information and will utilize the functionalities of the GIS system set up by the consultant during the current task order. Staff proposes to execute Task Order 002 of the contract to continue implementation of GIS. This task order will be for an 18-month period and will include continuation of GIS Administrative Services, data management, software troubleshooting, and providing training to METRO staff. The task order will also include developing a Public Involvement Stakeholder Management system. The proposed stakeholder management application will:

• Store stakeholder contact information and delineate if entries are tenant, property owner, or business owner for each parcel where a relationship exists

• Store address groups for stakeholders (such as neighborhoods or homeowners associations)

• Store stakeholder cases (communication, mailings, questions, issues, and incidents) for follow-up

• Enter case notes (communication history) including how communication was initiated (phone call, email, in person, letter), when a case was initiated (date and time), where a case was initiated (public meeting)

• Assign GIS location data to a case; construction project, line section, phase, parcel identifies, LRT number

• Enter notes in bulk for selected stakeholders (mass emails, mailings, attended public meeting)

• Search for stakeholders and cases based on any stakeholder or case attribute


• Export selected stakeholder information (contact, case notes) to Excel and print mailing labels

• Produce weekly, monthly, and quarterly summary reports of follow-up actions by line section and phase

• Allow role base secure access to the application for PI coordinators in the field and other METRO staff

The contract amount exceeds the Chief Executive Officer’s cumulative authority; therefore recommendation is requested of the RMC and approval by the METRO Board. FISCAL IMPACT Budget for Task Order 002 of the contract is $174,817.11 for GIS Administrator services and training and $42,420.50 for the development of the Public Involvement Stakeholder Management System for a total of $217,237.61. Funds are available from the Regional Area Road Fund with the initial portion included in the approved METRO fiscal year (FY) 2009 Operating and Capital Budget. Upon completion of task order 001, $47,078.34 is remaining in the approved FY 2009 budget and will be applied towards this task order 002. The remainder will be included in the METRO FY 2010 Operating and Capital Budget. RECOMMENDATION This memorandum requests that the RMC recommend METRO Board to authorize extension of the On-Call GIS Services Contract LRT-08-102-GIS for Task Order 002 to include continuation of GIS Administrator Services and the development of a Public Involvement Stakeholder Management System.

AGENDA ITEM 5B

Northwest Extension – Engineering Services Contract Amendment

AGENDA ITEM 5B



From: Brian Buchanan, Director of Design and Construction


Re: Northwest Extension – Engineering Services Contract Amendment

PURPOSE The purpose of this item is to request that the Rail Management Committee (RMC) recommend that the Board authorize budget contingency adjustments to the AECOM Transportation (DMJM Harris, Inc.) contract contingency from $750,000 to $944,738.27. This increase in the contract is for additional engineering services for the Northwest Extension Engineering Services. BACKGROUND AND DISCUSSION The METRO initial 20-mile light rail line construction was completed in the Phoenix metropolitan area. Additional future projects are included within the Regional Transportation Plan (RTP) that extends the high capacity/light rail transit system to 57 miles by 2026. The Northwest Extension is included in the adopted RTP and is scheduled for completion in 2012. On July 3, 2007, the METRO Board authorized the Chief Executive Officer (CEO) to execute a contract with DMJM+Harris, Inc. with a not to exceed contract amount of $14,936,761 with a $750,000 contingency in the event of unanticipated changes in the contact scope. The Contract LRT-07-074-PENW was executed on July 6, 2007. Changes Mod 4 to the design scope is as follows:

• Royal Palm Mitigation o Prepare frontage road and cul-de-sac options between Townley and

Seldon Way o Re-align and fully signalize Lawrence Lane and Alice Avenue o Prepare design concepts for this area o Provide screen wall and enhanced landscaping

• Provide embedded track work using 115RE rail in lieu of Ri-53N Girder Rail for operating environments outside of embedded special track work


o Track work and Track Slab design and details o Preparing Advanced Material Procumbent Package

• TPSS and Signal buildings – Three TPSS buildings and 3 Signal building (including the Signal building at the Dunlap Station) will be pre-fabricated with the following design criteria: CMU block screen wall surrounding the pre-fab building which is aesthetically similar to the existing buildings along 20-mile METRO Initial Segment, rear and/or side entry with lockable gates, coordinate with utilities, coordinate with Development Services Department to satisfy permitting requirements.

• Revising the track alignment and design in conjunction with relocating the Dunlap Station 10 feet to the south and changes associated with the roadway geometric changes because of the shift. Eliminate the South platform at the Dunlap station.

• Provide for double left-turn lane for southbound traffic on 19th Avenue to eastbound Dunlap Avenue, including traffic signal modifications.

• Potholing to be performed per Maricopa Association of Governments (MAG) Standard Section 728 – Controlled Low Strength Material.

• Deletion of the Transit Center at 19th and Dunlap Avenues. Providing bus pads southbound 19th Avenue and eastbound Dunlap Avenue West of the Dunlap station.

• Geotechnical Report went from a single-phase report to a Three (3) phase report, due to the uncertainty of the TPPS and Signal Building locations.

Design service Contract $ 14,936,761.00 CM 001 ($ 13,633.73) CM002 $ 47,497.00 CM003 $ 38,880.00 CM004 $ 871,995.00 Total Changes $ 944,738.27 Total Contract $ 15,881,499.27 FISCAL IMPACT This procurement is funded by City of Phoenix Transit 2000 funds and is part of the estimated $272.6 million Northwest Phase I Extension. RECOMMENDATION Staff requests that the RMC recommend that METRO Board authorize the CEO to increase the contract contingency to $944,738.27.

AGENDA ITEM 5C

Fiscal Year 2010 Federal Appropriations Request

AGENDA ITEM 5C



From: John Farry, Director of Community and Government Relations


Re: Fiscal Year (FY) 2010 Federal Appropriations Request

PURPOSE Staff is providing a listing of METRO projects to be forwarded to the Arizona Congressional delegation and requested for inclusion in the FY 2010 Federal appropriations legislation. The list of projects will be combined with the Valley Metro/RPTA appropriations request. BACKGROUND/DISCUSSION Each fiscal year, staff develops an appropriation request for the Arizona Congressional delegation related to the METRO system. For FY 2010, staff will be submitting a request that is summarized in the following table and explained below.

FY 2010 Federal Appropriations Request Funding Type Amount METRO 20-mile Project Section 5309 $90 million Central Mesa Preliminary Engineering Section 5309 $8.5 million Tempe South Preliminary Engineering Section 5309 $6.4 million I-10 Preliminary Engineering Section 5309 34.55 million I-10 Alternative Analysis/Draft Environmental Impact Study Section 5339 3.76 million

Consistent with the Full Funding Grant Agreement (FFGA) for the METRO 20-mile project signed in January 2005, staff will request that the delegation support $90 million for FY 2010. This amount should be consistent with the President’s FY 2010 budget submitted to Congress in February or March. Federally funded projects require that Alternative Analysis (AA) be completed prior to beginning of Preliminary Engineering (PE). Federal funding for AA studies for the Central Mesa and Tempe South projects will be completed in 2009, which will result in a request to

Rail Management Committee Memo January 29, 2009 Page 2 the Federal Transit Administration (FTA) to move the projects into Preliminary Engineering (PE). Section 5309 funding is being sought for PE. The estimated costs associated with PE for these projects in FY 2010 are:

• Central Mesa – $17 million • Tempe South - $12.8 million • I-10 West -- $69.1 million

In previous years, the FTA has funded approximately 50 percent of the costs associated with New Starts rail projects. The federal funding amounts reflected in the table on the previous page reflect a 50 percent federal share. Additionally, the City of Phoenix has advanced the AA and environmental documentation on the I-10 West corridor to coordinate with Arizona Department of Transportation’s (ADOT’s) design concept study for lane additions on I-10. The AA is scheduled for completion in 2009, and the Draft Environmental Impact Study (DEIS) process and PE will begin. The DEIS is an eligible Section 5339 expense, and as the maximum federal share is 80 percent for this program, funding will be sought under that program in FY 2010. As it is expected that PE will begin, $34.55 million will be requested from the FY 5309 program in FY 2010. FY 2009 Appropriations Process. The FY 2009 transportation appropriations bill is still pending in Congress. Federal transportation formula funding is continuing for FY 2009 through a “Continuing Resolution” that expires in March 2010. Specific amounts requested in the legislation are not funded until final passage of the legislation. The status of the FY 2009 requests will not be known until the legislation is enacted in early this year when the new Congress and Presidential Administration take office. Should the requests not be fully funded in the FY 2009 legislation, the FY 2010 request would be amended to address the unfunded requests. The pending requests for FY 2009 are:

FY 2009 Federal Appropriations Request Funding Type Amount METRO 20-mile Project Section 5309 $90 million Mesa Extension AA/DEIS Section 5339 $3.88 million Tempe Extension AA/DEIS Section 5339 $3.72 million I-10 West Corridor AA/DEIS Section 5339 $0.8 million Glendale Corridor AA/DEIS Section 5339 $4.64 million

FISCAL IMPACT The current cash flows for the METRO 20-mile project include $90 million of Section 5309 funding for 2010. Federal funding for the design and construction of light rail that is included in the METRO Light Rail/High Capacity Transit Life Cycle Program assumes approximately 50 percent federal funding over the life of the program. RECOMMENDATION This item is for information only. No action is requested.

AGENDA ITEM 5D

Reauthorization of the SAFETEA-LU

AGENDA ITEM 5D



From: John Farry, Director of Community and Government Relations


Re: Reauthorization of the Safe, Accountable, Flexible, Efficient, Transportation Equity Act – A Legacy for Users (SAFETEA-LU)

PURPOSE Staff is providing information to the Rail Management Committee (RMC) on the METRO policy and project requests for the Reauthorization of the Safe, Accountable, Flexible, Efficient, Transportation Equity Act – A Legacy for Users (SAFETEA-LU). BACKGROUND/DISCUSSION SAFETEA-LU expires on September 30, 2009. It is anticipated that Congress will begin the process of the reauthorization of this legislation over the coming Congressional session. METRO staff, in collaboration with member city staff, Valley Metro/RPTA staff, and Federal legislative counsel has created the attached “Federal Transit Authorization Policy” that outlines the important policy issues that should be addressed as part of the reauthorization process. The issues address all regional transit policy issues including bus and rail. This policy document will be communicated to the Arizona Congressional delegation to inform them of the issues of importance. Additionally, it is anticipated that the reauthorization of SAFETEA-LU will include authorizations for specific projects throughout the country. This authorization will allow projects to receive federal funding of the life of the reauthorization, usually a six-year period. For instance, SAFETEA-LU included an authorization for the Central Phoenix/East Valley 20-mile light rail project as well as extensions to that project that were included in the Regional Transportation Plan as approved by voters through Proposition 400. At the appropriate time and in the format suggested by Congress, METRO staff will again request that light rail projects that are part of the remaining 37-mile system in the Regional Transportation Plan be authorized to receive funding during the reauthorization period.

Rail Management Committee Memo January 29, 2009 Page 2 FISCAL IMPACT Federal funding for the design and construction of light rail that is included in the METRO Light Rail/High Capacity Transit Life Cycle Program assumes approximately 50 percent federal funding over the life of the program. The authorization to receive federal funding in the reauthorization of SAFETEA-LU will allow federal funding to flow as projects advance in the development process. RECOMMENDATION This item is presented as information only. No action is requested.

AGENDA ITEM 5E

METRO Customer Policies

AGENDA ITEM 5E



From: Lawrence M. Engleman, Director – Safety, Security and QA


Re: METRO Customer Policies

PURPOSE The purpose of this item is to inform the Rail Management Committee (RMC) of proposed policies that would apply to the METRO light rail system and its passengers. These policies are meant to supplement the ordinances that have been enacted by the Cities, as is done in the bus system. Attached you will find a copy of the METRO policies. BACKGROUND/DISCUSSION Prior to the opening of the METRO light rail system, the Cities enacted ordinances covering fare inspection, conduct, and use restrictions. These ordinances have the force of law and a violator can receive a citation with a fine for violation of the ordinances. The ordinances apply to all transit service in the region. However, METRO is often asked about conduct that is not covered in the ordinances. To help ensure a safe and orderly experience for METRO passengers, a series of policies has been developed. Many of these policies mirror the policies adopted for use by bus systems in the region. CATEGORIES OF POLICIES ARE: A) EATING AND DRINKING B) BICYCLES C) FARE ENFORCEMENT D) UNACCOMPANIED CHILDREN E) MOBILITY DEVICES

F) PARKING G) STROLLERS H) LOST AND FOUND I) GRAFFITI J) FIREARMS

FISCAL IMPACT There is no fiscal impact to METRO by virtue of the approval of the Policies. RECOMMENDATION This item is for information only. No action is requested.

AGENDA ITEM 6 METRO Board Resolution

Valley Metro Rail Board of Directors Resolution

On January 27, 2009 the Maricopa County Sherriff’s Office (MCSO) announced a plan to transport inmates from Sky Harbor Airport to a jail in downtown Phoenix by way of METRO light rail.

WHEREAS:

It is the goal of METRO to provide a safe, secure, and reliable journey for its passengers; Situations that create concern for passengers and discourage light rail ridership is of great concern to METRO; The MCSO first used METRO light rail on January 27, 2009 to transport an inmate from the 44th Street/Washington station to downtown Phoenix; Passengers that use light rail for purposes that include traveling to and from work, to schools along the alignment, and to special events have expressed concern for their personal and family safety related to this activity; and Public transportation systems, including METRO light rail, are not designed as a controlled environment and transporting inmates by this method is not a common practice nationally; NOW THEREFORE: Be it resolved that Valley Metro Rail and its Board of Directors request that the MCSO discontinue the practice of transporting inmates by way of METRO light rail. PASSED AND ADOPTED BY THE VALLEY METRO RAIL BOARD OF DIRECTORS THIS 18TH DAY OF FEBRUARY 2009. _____________________________ Vice Mayor Tom Simplot Chairman

AGENDA ITEM 7 Mid-Year Budget Adjustment

AGENDA ITEM 7 – REVISED



From: John P. McCormack, Director of Finance and Administration

Date: February 2, 2009

Re: Valley Metro Rail (METRO) Fiscal Year 2009 Mid-Year Budget Adjustment

PURPOSE This memo requests that the Rail Management Committee (RMC) recommend that the Board authorize updates to the Valley Metro Rail (METRO) Operating and Capital Budget for Fiscal Year (FY) 2009. BACKGROUND/DISCUSSION The prior fiscal year actual expenditures of $377.6 million under-ran the Budget by $69.8 million. The principal components of these spending shortfalls are summarized as follows:

The impact of the prior year under-run is a roll-forward of capital project costs to the current fiscal year. In particular, this causes the 20-mile METRO Initial Segment costs to increase versus the adopted annual budget. For the FY 2009 budget, the Mid-Year Budget changes are noted as follows:

Rail Management Committee Memo February 2, 2009 Page 2 20-Mile METRO Initial Segment: Expenditures The $1.4 billion 20-mile METRO Initial Segment funded under the Full Funding Grant Agreement (FFGA) will open in December 2008 within budget. The proposed Mid-Year Budget increase of $29.2 million is primarily caused by the carry forward of expenditure under-runs from FY 2008. The following table summarizes the changes to the Expenditures budget:

Revenues Funding requirements for the fiscal year are up from $122.4 million to $151.6 million: (Negative values indicate net repayment)

Federal Revenues are unchanged. Member City contributions are impacted by two factors:

1. FY 2008 funding under-runs have rolled forward causing increased funding requirements in fiscal year 2009

2. Public Transportation Fund (PTF) revenues are increasing due to changes in the Bond Funding amount.

For the 20-mile Segment, the PTF Sales Tax Revenue Bond Funds are to repay Member Cities for Regional costs. Reimbursements to the cities of Phoenix, Tempe, and Mesa for the 20-mile METRO Initial Segment Regional Assets fell behind schedule in FY 2008 and

Rail Management Committee Memo February 2, 2009 Page 3 FY 2009 due to declining regional sales tax receipts. The planned increase in bond funds will make up the amounts delayed and will ensure full payment to the cities within the scheduled payment period. A table depicting the changes to overall PTF revenue for FY 2009 is shown below:

Sales Tax Revenues are down by 10.3 million or 17.9% from the adopted budget. Planned Bond Revenue is up by nearly $60.0 million. The PTF Planned Reserve Balance is the amount of bond funds to be available at year-end to cover PTF funding commitments for the Northwest, Tempe, Mesa and Glendale Extensions which are to be paid out within the next fiscal year. Of the increased bond revenue in FY 2009, $39.7 million is to fund the 20-mile Regional Asset Reimbursements. Non- Prior Rights Utility Relocation Budget For FY 2009, Non-Prior Rights Utility Relocations increased by $4.4 million. Relocation costs related to CP/EV increased due to delays in receipt and audit of utility company billings which were expected to be paid in FY 2008. Relocations related to Northwest Extension are not progressing as planned and will be incurred in FY 2010.

Funding for the Non-Prior Rights Utility Relocations is from the PTF. 20-Mile Initial Segment - CNPA For FY 2009, changes for the 20-mile Segment – CNPA Budget consist of closeout reconciliations and the addition of several new CNPAs. A complete list of CNPA projects with cost at completion Budget changes is shown on page 14 and 15. The new CNPA projects are denoted with a triple asterisk (***). Northwest Extension (NWE) Phase I Budget Northwest Extension Project costs at completion remain as planned in five-year capital plan. Engineering and pre-construction administration costs are greater than planned. The Facilities, Real Estate, and Systems costs are not being incurred at anticipated levels. These costs will roll forward to FY 2010.

Rail Management Committee Memo February 2, 2009 Page 4

Changes to the NWE funding requirements are as follows:

Revenue Operations Budget The Adopted Revenue Operations Expenditure Budget of $15.8 million remains the same; however, contingency reserves are being drawn down to cover increases in certain line items. Changes are proposed as follows:

The cost of ADOT Safety Consultants is increasing $85,000 and the overall cost of liability insurance is increasing $168,000. These increases are offset by decreases in the Park & Ride Lots / Contingency ($100,000) and the Contingency Reserve ($153,000). Cash Flow requirements for the fiscal year are impacted by two elements:

1. Prepaid insurance costs of $527,861 are necessitated by the annual policy premium charge that will begin amortization in January 2009. Six months of this policy will pertain to FY 2010.

2. Ticket Vending Machine (TVM) Cash Bank funding of $150,000 is required to create change for passenger fare purchases at the TVM’s. TVM Cash Banks are a prepaid asset that will essentially remain on the books of each Member for the duration of METRO.

The resulting increased cash requirements for the cities are as follows:

City of Mesa $ 33,147 City of Phoenix 454,709 City of Tempe 190,005 $ 677,861

Rail Management Committee Memo February 2, 2009 Page 5 Agency Operating Budget: Agency Operating costs are increasing $550,000 to cover Regional Office Center (ROC) costs: land option costs; survey and appraisal costs; professional services costs; programming and design costs. These costs were approved for payment in FY 2008 and will be paid in FY 2009. Agency Operating costs are funded by Member Cities based on their voting percentage. Future Project Development Budget: For FY 2009, the principal proposed changes relate to delays in starting the Glendale Alternative Analysis (AA)/Environmental Impact Statement (EIS), a decrease of $1.1 million; lower than anticipated spending for the Tempe South and Central Mesa Corridors, decreases of $350,000 and $500,000, respectively; and, a $150,000 decrease in Planning Support Services. The following FY 2009 cost reductions are anticipated to be incurred in FY 2010:

The following funding sources impacted these decreased costs:

FISCAL IMPACT Refer to the attached reports on pages 6 through 15 for details of the estimated costs funded by each member city. RECOMMENDATION Staff is requesting that the RMC recommend the Board approve the updates to the METRO Fiscal Year 2009 Budget.

Rail Management Committee Memo February 2, 2009 Page 14 Concurrent Non-Project Activities (CNPA) Budget: Part I - December 2008

Rail Management Committee Memo February 2, 2009 Page 15 Concurrent Non-Project Activities (CNPA) Budget: Part II - December 2008

Rail Management Committee Memo January 29, 2009 Page 3 Policies regarding Bond Issuance

Authorization Steps

Bonds to be issued on behalf of METRO by RPTA are approved in the following sequence:

1. RMC and METRO Board Briefing on Financing –

• Approval to draft Authorizing Resolution and Preliminary Official Statement

• Concurrent Briefing to RPTA Board

2. Financial Review by Member City Staff of bond financial plan –

• TLCP with planned debt service

3. RMC and METRO Board approval Authorizing Resolution

• Concurrent authorization of RPTA Finance Sub-Committee and Board

Bond Limits and Restrictions

PTF Bonds will be issued without recourse to METRO or RPTA Member Cities.

PTF Bonds are issued to fund capital costs, which are identified in the RTP and TLCP.

• PTF Bonds will not fund cost of rail operations

PTF Bond debt service will be planned with contingencies so that all existing commitments against the Rail PTF Revenue funding source have been met with a satisfactory reserve.

PTF Bonds will be issued with optional redemption prior to maturity enabling early payment of the debt.

Contingency Planning / Debt Service Coverage Formula

Debt Service commitments will be analyzed against potential reductions in Rail PTF Revenue

• 36-month Rail PTF revenue shortfalls of 10 percent below ADOT Forecast of Transportation Excise Tax Revenues

• Long-term revenue shortfalls of 5 percent below ADOT Forecast of Transportation Excise Tax Revenues (three years to end of debt term)

Rail Management Committee Memo January 29, 2009 Page 4 Debt Service commitments will be analyzed against potential increases in cost of existing commitments

• Contracted and staff commitments 5 percent above TLCP Forecast

• Estimated commitments 15 percent above TLCP Forecast FISCAL IMPACT The bond issuance is scheduled for the spring of 2009. A summary of the Bond issuance assumptions are as follows: Bond Amount $ 85,000,000 Term: 16 Years Cost of issuance $ 455,000 Last Payment July 2024

Interest Cost $ 55,581,000 Average rate 6.1%

Financial Advisor: Kurt Freund, RBC Capital Markets

Bond Counsel: Robert Olson, Squires Sanders

Over the next nine years, the current obligations $261.3 million plus bond debt service $141.0 million will total approximately $402.3 million while PTF revenues would total approximately $432 million with no sales tax growth. The sales tax revenues will fully support the current obligations over this period, along with debt service payments to repay the bonds. The impact of the bond issue to the long-term TLCP is greater than planned finance costs. This impact, along with the decline in sales tax revenues, will be incorporated into the 2009 TLCP Update. The update will be delivered for RMC and Board acceptance prior to the final Board approval to authorize the Bond issuance. RECOMMENDATION Staff is requesting that the RMC recommend to the METRO Board to authorize staff to work cooperatively with the RPTA to draft the Authorizing Resolution and Preliminary Official Statement for the Spring 2009 Bond Issue for the purpose of funding the Regional Asset Reimbursements due to METRO Member Cities.

AGENDA ITEM 8 Regional Fare Policy

AGENDA ITEM 8


From: Richard J. Simonetta, Chief Executive Officer


Re: Regional Fare Policy

PURPOSE The purpose of this item is to provide information to the Rail Management Committee (RMC) related to the regional fare policy being considered by Valley Metro/ Regional Public Transportation Authority (Valley Metro/RPTA) Transit Management Committee and Board. Valley Metro/RPTA staff will present information related to the regional fare policy. (Please see attached information.) BACKGROUND/DISCUSSION Due to significant increases in operating costs for the regional bus system and the significant reduction of tax revenue, Valley Metro bus service providers are evaluating service reductions and fare increases. Without the fare increase, Valley Metro bus service providers may be forced to implement significant service reductions. Although a fare increase will reduce the level of service reductions, it will not eliminate the need to reduce service. Attached you will find a Valley Metro/RPTA memo and accompanying presentation with possible recommendations related to a fare policy change. The Valley Metro/RPTA Board will consider the fare policy at its meeting in February. METRO fares are integrated with the regional fare policy and any changes to that policy will impact light rail fares. RECOMMENDATION This item is for information only and no action is requested.

Regional Public Transportation Authority

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302 N. First Avenue, Suite 700, Phoenix, Arizona 85003 602-262-7433, Fax 602-495-0411

VMOCC Information Summary

Agenda Item #X

Date January, 2009 Subject Regional Fare Policy Program Summary For decades, sales taxes in Maricopa County have been heavily subsidizing operating expenses for Valley Metro public transit services. With the economic slowdown, much of the tax subsidies have declined. That has resulted in an operating deficit for Valley Metro. This sales tax shortfall has forced a proposal to restructure the fare policy to help alleviate the budget challenges. Although the base Valley Metro fare is $1.25 for 1-ride on a local bus or light rail, fares paid by Valley Metro customers covers just 24 percent of the cost of a ride. The other 76 percent is subsidized by taxpayers. The base fare for local bus service has remained $1.25 since 1994 and in 2007 the 1 day pass price was reduced from $3.60 to $2.50. Valley Metro is required to maintain fare revenues at a 25% target and the portion paid by riders does not currently meet the target. Over time the forecasted share paid by riders will continue to decline. In the next few years as the cost of providing transit increases the portion that riders currently pay will be less. If the current fares remain in place the forecasted fare revenue by the year 2012 will drop to about 22%.

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We have been fortunate that sales tax revenues have supported most of the cost to use transit however the decline has reduced funds available to continue to operate the service at its current level. Without the restructuring of the fare policy, Valley Metro will be forced to continue to cut service to help offset the budget shortfall. In addition to the fare policy restructuring, the new light rail service presents opportunities to consider fare policies to attract additional riders to both bus and rail while providing benefits for Valley Metro and METRO light rail operations. Valley Metro/RPTA’s purpose in undertaking this study was to evaluate and recommend fare policies (including pricing) to streamline transit use by developing:

A policy for large volume users (e.g., universities/colleges/technical schools, employers, and conventions)

A program for major sports/cultural events along the rail line

A policy that will meet the Board approved 25% farebox revenue recovery target Booz Allen Hamilton, a third party consultant, has been contracted to work with Valley Metro to identify and recommend fare policies that achieve these objectives. The Booz Allen proposed scope of work, staffing, schedule and budget was presented to the VMOCC for informational purposes on September 16, 2008. RPTA worked with the Valley Metro Fare Policy Committee to discuss proposed fare changes and to obtain their input on the alternatives to be modeled. This meeting took place on October 14. Based on the committee input, the recommended fare policies and pricing strategies were presented to the VMOCC and FOAC for consideration. The FOAC recommended moving forward the Fare Policy Program proposal to the Transit Management Committee (TMC) with several modifications. The TMC and Board reviewed the revised program proposal and made additional modifications to reflect comments by several members. The Valley Metro Board provided the approval to take the proposal through the public hearing process in January 2009. The public hearing process is taking place and the results will be brought back to Valley Metro TMC and the Valley Metro Board for final approval of the Fare Policy adjustments in February 2009. The following outlines the schedule and process to implement a fare change (if adopted) by July 2009 or earlier. 1. RPTA and City of Phoenix staff jointly develop proposed fare policy scenarios – early

October

2. RPTA convenes the Regional Fare Policy Committee to discuss proposed alternatives – October 14, 2008

3. Booz Allen to run fare policy model scenarios based on input from the Regional Fare Policy Committee – October 15-20, 2008

4. Valley Metro Operations and Capital Committee (VMOCC) and FOAC considers recommended fare policy scenario – October 21, 2008

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5. Valley Metro Transit Management Committee considers recommended fare policy scenario – November 5, 2008

6. Valley Metro Board considers the regional fare policy scenario and directs staff to conduct public meetings on the proposed fare policy – November 20, 2008

7. Public hearing process – January 2009 (The Federal Transit Administration requires 30-day advance public notice prior to convening the public hearings)

8. VMOCC is apprised of public hearing process input – January 2009

9. Valley Metro Transit Management Committee considers public hearing input on proposed fare policy – February 4, 2009

10. Valley Metro Board of Directors considers approval of new fare policy – February 19, 2009

11. Scheidt Bachman, a regional fare system vendor, re-programs the fare tariff – February thru May 2009

12. Conduct public information campaign and order new fare media if required.

13. Implementation of new fare policy – July 2009 or earlier The Regional Fare Policy Proposal The following proposed regional fare policy proposal was approved by the Valley Metro Board for public input. Adjustments to the fare policy which impacts:

- Local bus and light rail service - Express bus service - Rural route service - ADA paratransit (Dial-A-Ride)

o City of Phoenix - Phoenix also provides paratransit service (Dial-a-Ride) to Avondale, Goodyear, Tolleson, and Litchfield Park.

o East Valley including Chandler, Gilbert, Mesa, Scottsdale, Tempe, Paradise Valley, Guadalupe and parts of Maricopa County.

Key elements of the proposed fare policy include:

Multiple base fare options, including: – Increasing the base fare by up to $0.50 in July 2009 – An increase to the base fare again in July 2010, by up to $0.50, but not to exceed

$1.00 over two years Express fare premium increased from $0.50 to $1.00 Reduced fare discounts remain at 50% Passes priced at multiples of base fare:

– 1-Day Pass at 3.0 x base fare – 3 and 7-Day Passes at 2.5 x base fare x number of days of validity (i.e., 3 or 7 day) – 31-Day Pass at 31-33 x base fare

Adopt the recommended changes to the ADA paratransit fares Adopt the recommended changes to rural route fares

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The following chart summarizes the proposed scenario changes:

Fare Type Current $0.50 $0.75 $1.00

LOCAL

Cash $1.25 $1.75 $2.00 $2.25

1-Day On-Board $2.50 $5.00 $6.00 $6.75

1-Day Off-Board $2.50 $4.25 $5.25 $6.00

3-Day $7.50 $13.00 $16.00 $18.00

7-Day $17.50 $30.50 $37.00 $42.00

31-Day $45.00 $55.00 $63.00 $70.00

EXPRESS

Cash $1.75 $2.75 $3.00 $3.25

1-Day On-Board $3.50 $7.00 $8.00 $8.75

1-Day Off-Board $3.50 $6.25 $7.25 $8.00

31-Day $68.00 $85.00 $93.00 $100.00

REDUCED

Cash $0.60 $0.85 $1.00 $1.10

1-Day On-Board $1.25 $2.50 $3.00 $3.25

1-Day Off-Board $1.25 $2.00 $2.50 $2.75

3-Day $3.75 $6.50 $8.00 $9.00

7-Day $8.75 $15.25 $18.50 $21.00

31-Day $22.50 $27.00 $31.00 $35.00

SEMESTER PASS

Spring/Fall $160.00 $195.00 $222.00 $245.00

Reduced Spring/Fall $80.00 $97.50 $110.00 $122.50

Summer $105.00 $125.00 $145.00 $160.00

Reduced Summer $52.50 $62.50 $72.50 $80.00

As we review the chart, you will notice there are different costs associated with the purchase of a 1-Day pass depending on where it is purchased. The reason the cost is different is to encourage customers to purchase their passes at sales locations throughout the Valley. When passes are purchased on-board a bus, it actually slows down the bus to a point where it adds to the operating costs of the service due to delays. 1-day passes purchased off the bus will be discounted $0.75. The following proposed fare increase scenarios to the one-ride local bus and light rail fares were presented to the public:

Proposed Rural Route Fares The Valley Metro Fare Policy proposal includes changes to Rural Route fares. Two rural routes connect the cities of Ajo/Gila Bend and Wickenburg to the Phoenix metropolitan area. Fares have remained the same since the inception of the routes while service has been added and costs have increased. The increased fares help to maintain the service.All of the proposed fare changes are in blue.

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Proposed ADA Paratransit Fares (Dial-a-Ride) The proposed fare policy changes for ADA paratransit fares (Dial-a-Ride) include the city of Phoenix and the East Valley. The East Valley includes Chandler, Gilbert, Mesa, Scottsdale, Tempe, Paradise Valley, Guadalupe and parts of Maricopa County. Phoenix provides ADA paratransit service (Dial-a-Ride) to the Southwest Valley. This includes Avondale, Goodyear, Tolleson, and Litchfield Park.

Current Paratransit Fare (DAR)

Current Fixed Route Bus Fare

ADA Fare /Cash Fare Policy Proposed Fare Policy

East Valley $2.00 $1.25 1.6 x Local Fare 2.0 x Local

Phoenix $2.50 $1.25 2.0 x Local Fare 2.0 x Local

The proposed change is for the ADA paratransit (Dial-a-Ride) fare to be maintained at two times the local bus fare. The city of Phoenix is also proposing changes to the Phoenix monthly ADA Dial-a-Ride pass which includes two options: Option 1 is to increase to monthly pass to 20 times the 1-ride ADA paratransit fare. Option 2 is to eliminate the monthly ADA paratransit pass.

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Fare Increase Scenarios $0.50 $0.75 $1.00

One Way Local Bus and Rail Fare $1.75 $2.00 $2.25

ADA Fare (one way) - Scheduled trip (1) $3.50 $4.00 $4.50

Phoenix ADA Monthly Pass (2) $70.00 $80.00 $90.00

The monthly ADA Dial-a-Ride pass is only available to Phoenix residents. The Phoenix City Council will make the final decision on either adopting a fare change to twenty times the local fare for the monthly pass or eliminating it. Proposed Phoenix Non ADA Paratransit Fares (Dial-a-Ride) The city of Phoenix is also proposing changes to their Non ADA paratransit fares (Dial-a-Ride). This includes adjusting the Non ADA fares based on the local bus and light rail cash fare.

Fare Increase Scenarios $0.50 $0.75 $1.00 One ride Local Bus and Rail Fare $1.75 $2.00 $2.25 Full fare - Same Day First Zone $4.00 $4.50 $5.00 Full fare - Same Day Each Additional Zone $2.00 $2.50 $3.00 Reduced – Same day First Zone $2.00 $2.25 $2.50 Reduced – Same day Each Additional Zone $1.00 $1.25 $1.25

Public Awareness and Involvement Public notices were provided via mail, on buses, Valleymetro.org, and in local newspaper advertisements and press releases have been made available to local media. Most of the local media have been promoting the hearings and carrying the information on their web sites. The public had the following options to comment on the fares. • Mail their comments to Valley Metro • Email their comment to [email protected] • Phone in comments to Customer Service • Fill out a survey and provide comments at ValleyMetro.org

mailto:[email protected]

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• 7 Public Hearings (Avondale, Glendale, Mesa, 3 in Phoenix, and Tempe) • 1 Webinar. The Webinar was recorded and made available on ValleyMetro.org with the

opportunity to provide comment via an electronic survey • Business community via Transportation Coordinator Meetings and outreach by Valley Metro

Business Services Representatives Public Transit Fare Policy Hearing Schedule and locations Tuesday, January 6 Avondale City Council Chambers 11465 W Civic Center Dr. Wednesday, January 7 Tempe Transportation Center Community Room 200 E 5th Street Thursday January 8 Webinar – Registration via ValleyMetro.org 10:00 a.m. to 12:00 p.m. Mesa Grace United Methodist Church Fellowship Hall 2024 E. University Tuesday, January 13 North Phoenix Sunnyslope Community Center 802 E. Vogel Ave. Wednesday, January 14South Phoenix South Mountain Community College 7050 South 24th Street * Thursday, January 15 12:15 PM to 2:30 PM Downtown Phoenix MAG Saguaro Room 302 N 1st Ave. 2nd Floor Thursday, January 22Glendale Glendale City Hall Council Chambers 5850 W Glendale Avenue Fiscal Impact The investment to conduct the study and recommendations to implement a policy for large volume users (e.g., universities/colleges/technical schools, employers, and conventions) and a ticketing program for major sports/cultural events along the rail line is $49,999. The costs are to be paid evenly by METRO and RPTA.

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The cost to model and recommend fare pricing changes is not to exceed $22,900. RPTA budgeted funds will be transferred from the remaining consultant funds for the financial system to Regional Marketing. This will be funded with Regional Area Road Funds (RARF). Considerations Due to large increases in operating costs and the significant reduction of sales tax revenue which fund transit services, Valley Metro service providers are evaluating service reductions and fare increases. Without the fare increase, Valley Metro service providers may be forced to continue to implement service reductions. Although a fare increase will reduce the level of service reductions, it will not eliminate the need to reduce service. Committee Action Process • VMOCC tabled the original proposal – June 25, 2008 • VMOCC informational presentation – September 16, 2008 • Fare Policy Committee review and input – October 14, 2008 • VMOCC: On October 21, 2008, the VMOCC motioned to recommend the fare policy

change scenario and to forward the item to the TMC. The motion failed with a vote of 5 in favor and 7 against.

• FOAC: On October 21, 2008, the FOAC motioned to recommend the fare policy change scenario and to forward the item to the TMC with changes. The motion was approved by a vote of 7 in favor and 6 against. The changes were:

o Exclude recommendations for ASU, Special Events and Conventions o Increase 31-day pass to $50 for local and $76 for express

• TMC: On November 5, 2008 the TMC motioned to recommend the fare policy change scenario and to forward the item to the Board with changes. The motion was approved by a vote of 7 in favor and 6 against. The changes were:

o Implement the first phase adjustment July 2009 or earlier. Monitor conditions and implement the second phase if necessary.

o ADA paratransit strategies remain within each jurisdiction. • Board: On November 20, 2008 the Board approved the recommended fare policy change

scenario only for the purpose of authorizing the Executive Director to hold public hearings regarding the fare policy change. The public comments will be returned for Board consideration in advance of any approved fare change.

• VMOCC apprised of public input – January 27, 2009 • Fare Policy Committee finalizes the fare policy recommendation based on public input –

January 29, 2009 • TMC for consideration – February 4, 2009 • Board for consideration – February 19, 2009 • Phoenix City Council for consideration – February 2009 For Information RPTA will present a summary of the public input. Contact Person Mario Diaz Chief Marketing Officer 602-534-7391 Attachments - Proposed Regional Fare Policy Public Input Summary

Regional Fare Policy ProposalPublic Input Summary

December 2008 to January 23, 2009

January 27, 2009

Public Input Summary Report

• Public Awareness Campaign

• Public Hearing Presentation

• Survey Strategy

• Survey Results and Conclusions• Next Steps

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Public Awareness Campaign• December 2008 through January 23, 2009

• 1.2M impressions via 6 ads (AZ Republic, AZ Informant, La Prensa, La Voz)

• 10,000 mailers delivered to libraries, transit centers and park-and-ride lots

• 3,000 visitors to fare policy page on ValleyMetro.org

• 2000+ calls to customer service, 35 registered comments

• 1,300 mailers mailed to Maricopa Association of Governments public involvement database

• Employer Outreach:• 951 Transportation Coordinators reached with e-newsletter article• Webinar with Valley employers, 60 attendees, 88% aware of proposed changes

• 900 car cards on buses

• 235 comments emailed to [email protected]

• 84 people attended public hearing held via webinar

• 7 public hearings throughout the Valley (115 attendees)

• Public Relations and Media: Two press releases• Covered 25 times by 9 media outlets, more than 2.1 people million reached

• ABC 15, KTVK-Channel 3, KTAR, KFYI, Arizona Republic, East Valley Tribune and Clear Channel radio reporters conduct interviews on fare increases and public hearings 3

mailto:[email protected]�

Sample Communications

Car Card on Buses

Mailer

Print Ad

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Public Hearing Presentation

Proposed Fare Changes

• Local bus and light rail service

• Express/RAPID bus service

• Rural route service

• ADA paratransit (Dial-A-Ride)• City of Phoenix• East Valley

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Funding Public Transit

Paid for by local and state tax revenues.

Passengers pay less than 25% of the cost to ride.

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• Valley Metro is required to maintain fare revenues at 25%. • The current fares do not cover the passenger portion due to

increasing costs and is creating a budget shortfall.• Without increasing fares, service cuts will continue.

Forecasted Share of Cost Paid by Riders

Target (25%)

Funding Public Transit

2007 2008 2009 2010 2011 2012

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Valley Metro Compared to Others*

Fare Type Valley Metro Average/Range

Local 1-Ride Fare $1.25$1.84

Range: $1.25 - $2.25

Express 1- Ride Fare $1.75$3.00

Range: $2.50 - $6.00

1-Day Pass $2.50$4.73

Range: $2.50 - $6.00

31-Day Pass $45.00$66

Range: $40.00 - $85.00

* Dallas, TX; Los Angeles, CA; Minneapolis/St. Paul, MN; San Diego, CA; Sacramento, CA;Las Vegas, NV; Reno, NV; Denver, CO; San Jose, CA; Portland, OR; Salt Lake City, UT.

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Proposed Fare Increase Scenarios(Bus and Light Rail)

Local bus or light rail one ride fare is currently $1.25 and the all day pass is $2.50.

Assumes economic conditions stablize and costs do not significantly increase.

$1.00 increase: $2.25 one-ride local fare - $6.75 all day passMost likely to provide revenue to maintain current service

May provide revenue to restore recently eliminated service

May provide revenue for future service enhancements

$0.75 increase: $2.00 one-ride local fare - $6.00 all day passMore likely to provide revenue to maintain current service

$0.50 increase: $1.75 one-ride local fare - $5.00 all day passMay provide revenue to maintain current service or minimize service reductions

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Proposed Fare Increases

Fare Type Current $0.50 $0.75 $1.00

LOCAL

Cash $1.25 $1.75 $2.00 $2.25

1-Day On-Board $2.50 $5.00 $6.00 $6.75

1-Day Off-Board $2.50 $4.25 $5.25 $6.00

3-Day $7.50 $13.00 $16.00 $18.00

7-Day $17.50 $30.50 $37.00 $42.00

31-Day $45.00 $55.00 $63.00 $70.00

EXPRESS

Cash $1.75 $2.75 $3.00 $3.25

1-Day On-Board $3.50 $7.00 $8.00 $8.75

1-Day Off-Board $3.50 $6.25 $7.25 $8.00

31-Day $68.00 $85.00 $93.00 $100.00

REDUCED

Cash $0.60 $0.85 $1.00 $1.10

1-Day On-Board $1.25 $2.50 $3.00 $3.25

1-Day Off-Board $1.25 $2.00 $2.50 $2.75

3-Day $3.75 $6.50 $8.00 $9.00

7-Day $8.75 $15.25 $18.50 $21.00

31-Day $22.50 $27.00 $31.00 $35.00

SEMESTER PASS

Spring/Fall $160.00 $195.00 $222.00 $245.00

Reduced Spring/Fall $80.00 $97.50 $110.00 $122.50

Summer $105.00 $125.00 $145.00 $160.00

Reduced Summer $52.50 $62.50 $72.50 $80.00

Proposed Rural Route Fares

• Rural routes connect outlying areas to Phoenix• The increased fares will help to maintain the service

Wickenburg Surprise Glendale

Wickenburg -------- $3.00 ($4.00) $3.00 ($4.00)

Surprise $3.00 ($4.00) -------- $1.25 ($2.00)

Glendale $3.00 ($4.00) $1.25 ($2.00) --------

Ajo Gila Bend Buckeye Avondale Goodyear Tolleson Phoenix

Ajo ----- $3.00 $5.00 ($6.00) $6.00 ($7.00) $6.00 ($7.00) $7.00 ($8.00) $7.00 ($8.00)

Gila Bend $3.00 ----- $2.00 ($3.00) $3.00 ($4.00) $3.00 ($4.00) $4.00 ($5.00) $4.00 ($5.00)

Buckeye $5.00 ($6.00) $2.00 ($3.00) ----- $1.25 ($2.00) $1.25 ($2.00) $2.00 ($3.00) $2.00 ($3.00)

Avondale $6.00 ($7.00) $3.00 ($4.00) $1.25 ($2.00) ----- $1.25 ($2.00) $1.25 ($2.00) $1.25 ($2.00)

Goodyear $6.00 ($7.00) $3.00 ($4.00) $1.25 ($2.00) $1.25 ($2.00) ----- $1.25 ($2.00) $1.25 ($2.00)

Tolleson $7.00 ($8.00) $3.00 ($5.00) $2.00 ($3.00) $1.25 ($2.00) $1.25 ($2.00) ----- $1.25 ($2.00)

Phoenix $7.00 ($8.00) $4.00 ($5.00) $2.00 ($3.00) $1.25 ($2.00) $1.25 ($2.00) $1.25 ($2.00) -----

Route 685- Gila Bend/Ajo Fare Structure - Current fare (Proposed fares in blue)

Route 660 - Wickenburg Fare Structure - Current fare (Proposed fares in blue)

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Proposed ADA Paratransit Fares (Dial-a-Ride)

Current Paratransit Fare

(DAR)

Current Fixed Route

Bus Fare

ADA Fare /Cash Fare

Policy

Proposed Fare Policy

East Valley $2.00 $1.25 1.6 x Local Fare 2.0 x Local

Phoenix $2.50 $1.25 2.0 x Local Fare 2.0 x Local

East Valley and Phoenix ADA Paratransit services (Dial-a-Ride) • The cash fare to be maintained at two times the local fare.• East Valley fare will increase to $2.50 (currently $2.00).• If an increase in local cash fare is adopted, the East Valley fare would increase

annually until 2 times the local fare is reached.• The increased fares will help to maintain the service.

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• Proposed Phoenix ADA monthly pass structure changes:– Option 1 is an increase to 20 times the 1-ride ADA cash fare– Option 2 is to eliminate the monthly ADA pass

• Maintain ADA cash fare at 2 times the local bus and rail cash fares

Fare Increase Scenarios $0.50 $0.75 $1.00One Way Local Bus and Rail Fare $1.75 $2.00 $2.25ADA Fare (one way) - Scheduled trip (1) $3.50 $4.00 $4.50Phoenix ADA Monthly Pass (2) $70.00 $80.00 $90.00

Phoenix ADA Paratransit Fares (Dial-a-Ride)

(1) Includes Phoenix, Avondale, Goodyear, Tolleson, Litchfield Park and parts of Paradise Valley(2) ADA Monthly Pass is available only to Phoenix residents

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Non ADA Cash Fares:

Fare Increase Scenarios $0.50 $0.75 $1.00

One ride Local Bus and Rail Fare $1.75 $2.00 $2.25

Full fare - Same DayFirst Zone $4.00 $4.50 $5.00Full fare - Same DayEach Additional Zone $2.00 $2.50 $3.00Reduced – Same dayFirst Zone $2.00 $2.25 $2.50Reduced – Same dayEach Additional Zone $1.00 $1.25 $1.25

Phoenix Non ADA Paratransit Fares (Dial-a-Ride)

• Adjust the Non ADA fares based on the local bus and light rail cash fare

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Public Survey Strategy

Survey and Input Instruments

Comments emailed to [email protected] mailed to RPTA; attention Fare Program ManagerCalls to Customer Service

Comment Card at Fare Hearings Zoomerang Survey on ValleyMetro.org

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Public Survey Strategy

• Survey instruments were used to capture a clearer understanding of:– “Level of support” for each of the three pricing options– Of the 3 pricing options, which one would respondents

most likely support– Given the choice, which was most important: level of

service OR cost to use transit• Any other overall customer comments• Sources: comment card = 72, Online survey = 38,

[email protected] = 235• Compiled by Westgroup Research

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Results

4.5 Average

3.2 Average

2.3 Average

There is not strong support for a fare increase at any level among those responding

n=98 Strongly Support 8-10 4-7 Strongly Oppose 1-3

Level of Support for Fare Options

21%13%

8%

33%

22%

9%

46%

65%

83%

$.50 increase $.75 increase $1.00 increase0%

20%

40%

60%

80%

100%

20

Q: Of the three options presented, which one are you most likely to support? CIRCLE ONE OPTION ONLY.

Option Most Likely to Support

n=116

75%

14%11%

$.50 Increase $.75 Increase $1.00 Increase0%

20%

40%

60%

80%

100%

When asked to choose between the three options, three in four selected the $0.50 increase

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Q. Overall, please indicate which ONE of the following two items is most important to you as a transit user? CIRCLE ONE.a. The cost to use public transit b. The level of transit service available

Most Important Issue

n=91

60%

40%

Cost to use public transit

Level of transit service available

0%

20%

40%

60%

80%

100%

The cost to use public transit was more important to respondents than the level of service available

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Open ended comments

n=323

31%

25%

24%

10%

9%

8%

8%

6%

5%

4%

3%

3%

3%

3%

2%

2%

Raising cost will lower ridershipcheaper to drive

Don't increase fare - tough economy

Raising cost will be difficultfor transit dependent

Fix fare boxes

Look for other revenue sources

More accepting of fare increase if service improved

Support small increase/keep to minimum/25 cents

Wait to see impact of light railincrease hurt lt

Oppose $1 increase/excessive

Focus on increasing ridership to keep costs down

Increase should be phased in gradually

Fare was just increased in 2007

Afraid state will stop fare subsidy

Decrease service/do not increase fares

Support fare increase (general)

Make fare whole dollar amount/no change

0% 5% 10% 15% 20% 25% 30% 35% 23

Input from Organizations• Friends of Transit: Adopt lowest possible fare structure.

• State of Arizona and Maricopa County: Adopt lowest possible fare structure to minimize impact to transit subsidies offered to employees.

– Platinum Pass Program may be to expensive for both the employer and employees.

• East Valley Chambers of Commerce Alliance: Against any fare increase.

– Arizona's largest chamber of commerce with 7,500 members in Ahwatukee, Apache Junction, Chandler, Gilbert, Mesa, Queen Creek, Scottsdale and Tempe.

• Tempe Chamber of Commerce: Against any fare increase.

• Southwest Chamber of Commerce: Will support Valley Metro’s recommendation.

• Other Organizations: Voiced concerns and impacts.– Tumbleweed Drop-in Center (youth), New Arid Club (homeless), ECAL Justice Center (Seniors),

Lodestar Day Resource Center, Scottsdale Healthcare, Southwest Rail Corridor Coalition, East Valley National Foundation of Blind

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Conclusions

Most Frequent Comments

• Valley Metro is pricing themselves out of the market. It will be cheaper for me to drive.

• We’re in a tough economic time at the moment; please don’t raise fares too much.

• Raising fares will be difficult on the transit dependent.

• Fix fare boxes before any fare increase.

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Conclusions• Ideally no fare increase. However if a fare increase must occur a $0.50

increase garnered the most support.

• A strategy to improve the fare collection process on the bus, smart cards and a retail outlet strategy must be considered as part of any recommendation.

• The cost to use public transit was slightly more important to respondents than the level of service available.

• With any increase, the public expects service to improve. Setting public expectations regarding service will be critical.

• A significant increase may force discretionary riders to drive rather than use transit.

• Employers are concerned about the impact to the Platinum Pass program. Consider a daily cap and a minimal increase to the monthly pass.

Note: 75% of transit users belong to households earning less than $35,000. About 50% are transit-dependent (do not own a vehicle). Origins/Destinations Study, 12/07

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Next Steps

• January • Fare Policy Committee finalizes the regional recommendation

• February• Consideration by the Operations and Capital Committee

• Consideration by the Transit Management Committee

• Review by the METRO Rail Management Committee and Board

• Consideration by the Valley Metro Board, and the Phoenix City Council with potential adoption of the new fare structure

• July – If adopted, the new fare structure begins

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AGENDA ITEM 10 Issuance of Bonds to Fund

Regional Assets

AGENDA ITEM 10 - REVISED



From: John P. McCormack, Director of Finance and Administration

Date: February 2, 2009

Re: Issuance of Bonds to Fund Regional Assets

PURPOSE The purpose of this item is to request that the RMC recommend that the METRO Board authorize staff to work cooperatively with the RPTA to draft the Authorizing Resolution and Preliminary Official Statement for the Spring 2009 Bond Issue for the purpose of funding the Regional Asset Reimbursements due to METRO Member Cities.

BACKGROUND/DISCUSSION Use of the Bond Proceeds is to reimburse the cities of Phoenix, Tempe, and Mesa for payments made to fund purchase of the Regional Assets for the Central Phoenix/East Valley (CP/EV) Light Rail Transit (LRT) Project. The regional assets include Light Rail Vehicles, Bridges, Operations and Maintenance Facility, Operations Control Center, and four Regional Park and Ride Parking Facilities. Reimbursements are for the net amount funded by each city after receipt of the federal funding provided by section 5309 New Starts money received under the Full Funding Grant Agreement (FFGA). Regional Asset Reimbursements to Phoenix, Tempe, and Mesa commenced in fiscal year (FY) 2007 and to date $73.1 million of the total $198.7 million total amount has been funded.

Funding the Bond Payments: The Regional Transportation Plan (RTP) dated November 2003 included expenditures for LRT Regional Costs for the MOS (First 20 mile Minimum Operating Segment). With the passage of Proposition 400 (Prop 400), these costs have become part of the Transit Life Cycle Program (TLCP) funded by the Public Transportation Fund (PTF).

The PTF collects 33.3% of the sales tax revenue from the Transportation Excise Tax, which flows from the State to the Regional Public Transportation Authority (RPTA). The “Rail" portion of the PTF revenues is 43.24% of the total transit funds received by RPTA. Based on Arizona Department of Transportation’s (ADOT’s) 2008 forecast of Transportation Excise Tax Revenues, the Rail portion of the tax will generate approximately $1.9 billion over the 20-year life of the tax (To date the tax has generated $153.5 million rail funds).

Rail Management Committee Memo January 29, 2009 Page 2 Other Obligations against the Funding Source: In addition to the reimbursement of the CP/EV regional assets, the PTF rail funds were designated in the RTP to fund planned rail extensions to the 20-mile initial segment as well as system-wide improvements to the LRT system. With the passage of Prop 400, the state legislature added the reimbursement of utility relocation expenses to utility companies who otherwise would fund the relocations under their existing agreements. The reimbursement of these “Non-prior Rights” utilities creates an obligation that was not in the RTP.

A summary list of obligations to date against the funding source is as follows:

Why Bond Now?

From the table above, current obligations to be funded through FY 2011 are approximately $200.8 million, while sales tax revenues are projected to total $123.8 million ($77.0 million projected funding shortfall). Reimbursement to the cities of Phoenix, Tempe, and Mesa for the Regional Assets makes up $125.6 million of the funding requirement.

The need to borrow this year is to fulfill METRO’s funding obligation to reimburse the Member Cities within the planned five-year reimbursement schedule. For the five-year reimbursement period (FY 2007 thru FY 2011), estimated sales tax revenues are down $54.2 million versus ADOT's 2007 sales tax forecast. In order to complete the reimbursement on schedule, make payment on the remaining obligations and maintain sufficient reserve against further revenue shortfalls, the amount of bonding proposed is $85 million.

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