Metro balances budget with federal CARES funding

Federal relief funding of more than $767 million is helping Metro close out the current fiscal year with a balanced budget, following an unprecedented drop in fare revenue due to the pandemic crisis response. For the coming fiscal year, the CARES Act funding will also enable Metro to cover increased expenses driven by enhanced safety measures and manage the risk of lower than anticipated jurisdictional subsidies due to covid-constrained budgets.

“We are fortunate to have supporting jurisdictions and a congressional delegation that both understand and advocate for Metro’s role in the region’s mobility and economy, especially during a crisis,” said Metro General Manager/CEO Paul J. Wiedefeld. “Thanks to CARES relief funding, we have been able to keep people working and continue to move essential workers as safely as possible during an unprecedented crisis.”

The Board passed a $2.07 billion FY21 operating budget in April after months of public input that supported service improvements and fare discounts. However, as the region grapples with covid economic impacts, the new budget defers those service and fare initiatives, instead funding Metro’s three-phase recovery plan.

“There are so many variables here that any one of these could put our ability to deliver service at risk,” said Wiedefeld. “While we are deeply grateful to Congress for their support, we will need additional help to get the nation’s capital moving again.”

For the fiscal year beginning July 1, the new budget proposal anticipates that CARES relief funding will replace $438 million in additional lost revenue while Metro ramps up gradually, aligned with requirements from the region’s governors and mayor. The revised budget safeguards employee and customer wellness by underwriting increased expenses from new safety measures, including personal protective equipment, disinfectant and cleaning increases, and additional labor expenses from modified work schedules. The proposal also provides $45 million in cost cuts through management actions such as deferred supplies purchasing, a hiring freeze and elimination of vacancies to take some pressure off funding jurisdictions with declining tax revenues. Wiedefeld is expected to tell the Board that no layoffs or furloughs are included in this proposal, subject to the jurisdictions’ ability to pay the lower subsidies.

The Board will play an important role with ongoing monitoring of the budget and potentially making revisions as necessary due to ongoing regional and national economic uncertainty, Wiedefeld noted.

Metro’s $1.82 billion capital program is largely unchanged.