Metro’s funding shortfall next fiscal year is so steep that even an additional $300 million couldn’t stave off severe service cuts that would include the elimination of bus routes, reduced rail hours, longer train waits, and station or station entrance closures.
Metro leaders on Tuesday released multiple outlines for reduced service for fiscal 2025 that take into account a projected $750 million budget shortfall, as well as what would happen if Metro received no funding increase or only a partial increase. While the plans are only a possible framework and could change dramatically before July 1, the start of the new fiscal year, Metro officials said the proposals include carefully “targeted” cuts to minimize effects on the most passengers.
The plans are intended to show how quickly transit service in the region could deteriorate without a huge injection of subsidies from jurisdictions across the Washington region. The outlines are the transit system’s latest attempt to sound alarms about the depths of its financial troubles, a problem hastened by the end of federal pandemic aid.
Metro officials warned that severe service cuts — even for one year — would have lasting consequences for the transit system. Hiring and training staff to replace laid-off operators and technicians would take months. Service cuts, they warned, also would result in lost passengers.
Changes in work and travel routines during the pandemic have contributed to a loss of nearly 40 percent of Metrorail riders, leading to diminished fare revenue.
“Look how hard it was for Metro to recover after covid,” said Metro General Manager Randy Clarke.
Metro board members will discuss the scenarios during a regular meeting Thursday. The board isn’t expected to finalize a budget until April, but decisions that include layoffs would probably have to be made more quickly. Union contracts stipulate that Metro must warn workers by January of any potential layoffs.
Regional leaders have been working for months on how to help close Metro’s budget hole for next year and in subsequent years, but no specific plans have emerged. Metro also faced a funding shortage in 2020 and developed similar draconian service plans, but the federal government ultimately provided Metro and transit systems across the country with billions of dollars in pandemic-related financial aid.
The funding package, which made up for fare money lost as office workers telecommuted, lasted more than three years. The $2.4 billion Metro received will run out this year, leaving the transit agency hopeful that regional governments will step forward.
The budget plans are useful for regional leaders working on short- and long-term funding fixes, said Clark Mercer, executive director of the Metropolitan Washington Council of Governments, which is organizing the multi-jurisdictional search for funding.
Mercer said chief administrative officers from area governments are putting together a report for lawmakers, governors and mayors that lays out a path to raising money for Metro for the next fiscal year. Another working group of government officials is looking at longer-term solutions, he said.
“We’re kind of concentrated right now on what makes the most sense for the next year or two,” Mercer said.
In the meantime, transit leaders say they are cutting costs to lessen the burden on D.C., Maryland and Northern Virginia, which subsidize the agency’s operations. But cuts only go so far with a rail system that has fixed costs regardless of whether riders use the system, officials said.
“There’s no silver bullet at the end of the day,” Clarke said.
Transit officials said they cut $95 million in spending this fiscal year by reducing travel, consultant services and the pace at which the agency is using its remaining federal aid. Metro leaders are looking to cut another $50 million next fiscal year by consolidating functions such as call centers and reducing the need for IT hardware.
When Metro faced a much smaller hole last year, transit officials shifted expenses for preventive maintenance from Metro’s operating budget to its capital budget, saving $199 million. Metro leaders said that next year, they want to move even more of that cost — $345 million, or almost half of what Metro spends annually on preventive maintenance — into the capital budget. The capital budget funds construction projects, major repairs and replacement vehicles. It receives separate funding, including contributions from the federal government.
But such a shift could force Metro to cut back on some long-term projects, including the purchase of electric buses and new rail cars to replace those about 40 years old.
Service cuts could help Metro save up to $20 million. Cuts could include reducing peak rail service to every 20 minutes and every 30 minutes the rest of the day.
The Metrobus system could cut all routes except the busiest 37. It could shorten routes, remove routes near Metrorail lines and ask other bus agencies to pick up far-reaching routes — all of which could save up to $10 million annually.
Rail stations could close full-time or during weekends. Rail yards could be shuttered and Metro could consider closing two of its nine Metrobus garages. The agency could switch to running mostly four- or six-car trains instead of eight-car sets, which would decrease maintenance and energy costs, saving up to $8 million.
Metrorail could close an hour earlier on Friday and Saturday nights, netting $3 million in savings, budget officials said. Cutting the time Metro runs peak service during rush hour from four or five hours to two or three hours could result in up to $5 million in savings. Between $2 million and $7 million could be saved by reducing the number of trains leaving the downtown core, while lines could also be shortened.
“Even this level of pain doesn’t save us a significant amount of money,” Clarke said.
The agency would also consider raising fares for the second time in two years, which could bring in tens of millions of dollars. The result, however, would be a substantial loss in ridership, Metro officials said.
In each scenario, as many as 4,700 people in the transit agency’s 13,000-person workforce could lose their jobs.
The bleak picture improves slightly if more federal workers return to offices. Once 12 percent of Metro ridership, federal workers now make up 6 percent. Reductions to inflation could save Metro $23 million, while efforts to stem fare evasion could result in Metro recapturing $20 million.
Leaders across D.C., Maryland and Virginia said the potential service reductions drive home a message of urgency.
“None of these options may be optimal but they need to be on the table as Metro can’t control the level of subsidy it receives from state and local governments,” said Maryland Del. Marc Korman (D-Montgomery), chair of the Environment and Transportation Committee. “But state and local governments need to see the trade-offs as they make their own decisions.”
Local officials know that without more funding, there would be “difficult trade-offs of service” that would hurt residents, said Kate Mattice, executive director of the Northern Virginia Transportation Commission, which represents Virginia jurisdictions that fund Metro. They are also facing “economic uncertainty” in their own localities because of telework as Metro struggles with empty seats on trains, Mattice said.
While Metro plans for the future, the transit agency is expected to resume a $55 million project to reassemble thousands of 7000-series rail car wheels, based on federal data earlier this year that indicated flaws in how they were pressed onto train axles. Metro plans to reassemble the wheels on about 20 cars each month as part of a massive undertaking to refit 5,984 wheels onto 2,992 axles of all cars in the series.
The project was paused after Metro experienced too many “misfits,” David L. Mayer, chief executive of the Washington Metrorail Safety Commission, said Tuesday during the regulatory agency’s monthly meeting. Last week, Mayer said, the safety commission reviewed Metro’s changes and had no objections.