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Enhanced Interrogation: Joseph Calabrese

CEO, Greater Cleveland Regional Transit Authority

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After a week of often-heated public hearings over proposed service cutback, Calabrese talked with Scene about the challenges facing RTA.

What's the most popular misconception you've heard in the course of these public meeting?

I think the one thing that is most hurtful to me that is certainly a misunderstanding is that we don't understand or even care. We care tremendously. I spend the majority of my time fighting for investment in public transit so I can provide the level of service [riders] need, and I've been relatively successful in some ways, and [in] others, not as successful as I want to be. That's a function of two things: the economy and other people not understanding the importance of what we do, such as elected officials who fund many things but don't understand how important this is. If they did, they would fight for more money for public transit. Saying to people that "I'm going to take away your bus" is like telling people "I'm going to take away your car."

Some people believe that ODOT puts more money into cutting grass along highways than into public transit.

Someone at the public hearing said that, and I don't know if that's true. I know that funding from ODOT has dropped by 75 percent since 2002. I do know that between the mid '90s and the mid '00s, while most states had increased their funding of public transit by an average of 130 percent, ODOT reduced its funding by 40 percent. I do know that the average state provides 23 percent of the funding needed for public transit systems in their states. I know Ohio provides less than 3 percent. I do know that, based on the percentage of money that Ohio spends on highways versus public transit, Ohio ranks 40th. They pay 99.3 percent of their money to highways and .7 percent to pubic transit. These are amazing numbers for a state that has our population and our transit usage. The states behind Ohio are states with no people, Wyoming, Nevada and North Dakota, places with no urban core or reliance on public transit. Ohio has underinvested in public transit. I know the governor's office knows that. I know the ODOT director knows that. They're trying to help us. I know that they're facing a similar financial challenge — they have no money either — but it's going to take bold leadership to find that [revenue] source, like other states have, to fund something so critical to many people in Ohio. I think we want to be about job development and economic development. I think it's critical to keep our young professionals in the state or attract young professionals that are migrating to cities and want a more sustainable and environmentally friendly lifestyle. That can only happen with a viable and comprehensive public transit system in the cities they want to live and work in.

But the problem sounds like getting people to care in an automobile-centric state.

You think that's why it's against the state constitution to use the gas tax for anything but highways? It certainly is a very automotive-oriented state. The highway lobby, the asphalt lobby, the concrete lobby, the auto dealers lobby, the automotive industry lobby — it always has been a very automobile-oriented state. But there is hope. It is against the state constitution here to use gas-tax money for public transit. It was also against the state constitution in Michigan to use any gas-tax money for public transit — Michigan, the No. 1 automobile-oriented state in the nation. A couple of years ago, they changed the constitution to allow that. There certainly is hope, but it's not going to be easy. It certainly would be easier in a robust economy, where there would be more money flowing into Columbus. Somebody's got to display leadership and make this happen. It seems that there are more leaders and advocates in the House of Representatives in Columbus, where you have more urban orientation than in the senate. There are some senators from the urban core that better understand that. The whole movement to invest in urban cores and cities — because that's where jobs are produced, and that would help suburban and rural areas — I think there's more of that feeling in Columbus and I think that could point leadership to find a reliable funding source for public transportation. If we continue to get money from the general fund and compete with many, many other things of tremendous need, I don't ever think we'll do real well.

What is RTA's vision for providing that sustainable, environmentally friendly option?

The message from RTA when it comes to the environment is this: RTA is clean. If only 10 percent of the trips nationally are taken on public transit, we would not need one drop of oil from the Middle East. There are two things that are important to us — the environment and energy dependence. Public transit can be a solution. The other thing is jobs. An investment in public transit is an investment in jobs, as I testified before Congress a month ago as part of the stimulus package. We did get some stimulus money. Interestingly, the stimulus money that went to public transit versus money that went to highways is producing jobs at a 2-to-1 rate. Both [sectors] have a very good track record, but public transit did a great job of getting the money out there.

Initially, the stimulus money could only be used for bricks-and-mortar capital projects. The transit industry has had more success in Washington D.C. than in Ohio, in that out of the federal gas tax, 82 percent goes to highways, 18 percent goes to public transit, versus Ohio, where [virtually] 100 percent goes to highways. The public-transit industry lobbied, and there was an amendment passed in June, that said we could use up to 10 percent of stimulus money for preserving jobs and not just creating new jobs. We did that. That allowed RTA to save the jobs of 57 bus drivers. But that's not the main part of the story. The main part is that those 57 operators each take over 100 people a day to and from work. You've got well over 5,000 jobs that we preserved by us saving those bus drivers' jobs. If we cut service people, they will be unemployed and unemployable. That's the last thing we want to do, not just in terms of trying to recover from this great recession, but in trying to move those people to work to support themselves, support their families and even some day pay taxes — wouldn't that be a great thing? We get people to work. I've talked to several managers at Steelyard Commons who tell me up that 60 percent of their employees get to work by public transportation.

Historically, how do you feel that RTA started to lose the battle to bring in new riders who might have a car but want RTA as a viable alternative?

I don't think we've lost the battle. We had six years of continuous ridership growth between 2002 and 2008. As the economy got difficult, as the state cut back funding, as we were paring back service, we still had ridership increases. Last year, we had a ridership decrease, and that was [a national trend]. The reason was totally associated with the recession: People aren't working, they're not riding. Sixty percent of trips on public transit nationally and here in Cleveland are work-related trips.

We also saw another phenomenon where people were still employed but maybe only working three or four days a week or were being on furlough days. If you're taking off every other Friday, that's 10 percent less utilization of RTA for that individual. If you're taking off every Friday, that's 20 percent.

The issue for RTA was that there came a point in time when the state cut funding for public transit that our wonderful local funding source [county sales-tax money] simply could not keep us sustained. A couple of reasons for that: one, we're losing population. In the 1990s, the sales-tax revenue increased at an average of 5.6 percent. Since 2001, it's increased at a rate of 1 percent. At that rate, we cannot maintain the level of services year after year. It's impossible. That is going to continue to happen unless there is some mitigating factor.

At the same time, the federal government has been a great partner for public transit. The federal government began funding public transit in the early '70s. However, in the mid-1990s, they changed direction. They were going to continue funding public transit, but they were only going to fund it from a capital perspective, not an operating perspective. You had the federal government phasing out operating assistance. You had the state cutting its funding to public transit. And you have the local economy suffering. I believe that in the Cleveland market, we've been a recession since 2001. We now have a recession on top of a recession.

Is there any way more money could be used out of the local sales tax for public transit?

I think anything's possible. When you look at best models in the country, our local funding source, our one percent sales tax is a best practice. There aren't many local systems that get a higher percentage of sales tax. The federal funding is connected to a formula, and one thing it's related to is the census. We'll be getting less of an increase as we become less and less populated. Maybe that's why I've harshly criticized the state of Ohio. That's the hole in the formula. Locally, we're losing population, and those that are left are those with less financial means. I don't think that this is the time to go to county taxpayers to get a higher percentage. I think the answer is with the legislature: Why can't they do what other states do?

What states are doing it right?

Go to New York, Massachusetts, Illinois, Pennsylvania. Two years ago, Illinois and Pennsylvania almost doubled their funding over a 10-year period. The average state during that time increased funding by 130 percent. Ohio is significantly in the negative side.

What are they doing that they're not doing?

A number of things. I've stopped giving suggestions on how to fund public transit. My goal is to convince them of the need and let them figure out how to do it. In New York, funding comes from a variety of sources, many of which are invisible to the taxpayer. It may be a piece of a mortgage-recording fee. It may be a piece of a telephone bill. It may be a piece of a property-tax assessment. It's out of eight or nine different sources. In Pennsylvania, there were using lottery proceeds. There was a sales tax on tires. There's a sales tax on liquor. In Nevada, they use part of the casino-gambling proceeds. And in many states, a piece of the gas tax [is used]. But in some states, in the '50s and '60s and '70s, the automobile lobby was able to actually pass referendums saying the gas tax could only be used for highways.

ODOT [faces a looming crisis] because of two things: One is the gas tax. Here and nationally, it's tied to a cents-per-gallon formula. It's not indexed to inflation or tied to a percentage. As people are driving less, and as we encourage them to drive less, and use public transit or buy hybrid cars, the revenue from the gas tax is going down. Even those funded by the gas tax are running into an issue.

[Calabrese explains that he served on state committee to study the future of transportation in Ohio. The task force agreed that public transit should be funded to a level of 25 percent and explored the idea of raising the state sales tax or redirecting some of the gas tax by changing the state constitution.]

I was certainly in favor the sales tax; I knew that changing the constitution would be difficult. But there were others on the committee who represented cities and counties who said, "The sales tax is used for things like convention centers, medical marts, major infrastructure projects, and we don't want to compete with transportation." So the final recommendation that went to the governor a year ago was that raising the gas tax would be best. The governor said quite respectfully that he understood the issue, but now is not the time to be raising taxes. I'm not saying that's a surprise.

But what about the argument that you can invest in public transit and thus lessen the need for road maintenance?

Those are great arguments. I can't do this alone. I go down to Columbus, and I've testified at the past three or four budget hearings. I go to Washington and testify. But the people that really make a difference are the customers and the voters. But a lot of my customers are not politically active. They just want Joe to go do it. I can't do it alone. But that's the thing about the public hearings — for the first time ever, we're seeing the formation of a coalition [Save Transit Now], petitions were signed, e-mails were sent — there seems to be more support from people who don't work in public transit to make this happen. I'm really hopeful that getting other people involved will get legislators encouraged to figure this out.

Speaking of the public hearings — if enough people said they take a route that's on the reduction list, will that route be kept?

Without any doubt, changes will be made based on what we've heard. If there isn't any money, there will have to be a redistribution of things, because it's a net-sum game. If I'm going to provide more service here, I have to cut service here. We asked people to give us specific information — where you get on, when you get on — so we can try to make those connections. Those comments helped us.

What will be the role of RTA's unions in trying to fix this problem?

Labor is 70 percent of our cost. Eighty-nine percent of our employees are unionized. There are two unions: the Amalgamated Transit Union, which represents 95 percent of the unionized work force [2,000 members including drivers, mechanics and clerical workers] and the Fraternal Order of Police, which represents our transit police [100 members]. We are currently in labor negotiations with the ATU. Their contract expired August 1. We are asking for them to work with us to lower our costs, and if we can lower our costs, we can cut less service. If our costs are increased, our cuts have to be more severe. What we projected in our budget is that there would be no cost increases. We hope there are cost decreases that will allow us to save jobs and preserve service. If this projected service cut goes into effect in April, that will mean 219 layoffs. A good percentage of those can be avoided if we can reach some consensus with the union on ways to lower costs. We have not been able to do that. A fact finder has been called in to issue a report, which is non-binding. We'll meet with the fact finder in early February and we'll see what happens. Our contract with the FOP expires in February, and we'll continue to negotiate with them, but there are small piece [of the unionized work force].

dguevara@clevescene.com

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