Labor Community Strategy Center v. Los Angeles County Metropolitan Transportation Authority Plaintiffs' Revised Statement of Contentions of Fact and Law
Public Court Documents
October 24, 1996
Cite this item
-
Brief Collection, LDF Court Filings. Labor Community Strategy Center v. Los Angeles County Metropolitan Transportation Authority Plaintiffs' Revised Statement of Contentions of Fact and Law, 1996. c5714736-ba9a-ee11-be36-6045bdeb8873. LDF Archives, Thurgood Marshall Institute. https://ldfrecollection.org/archives/archives-search/archives-item/963068ea-bede-43b8-b632-027e373bbb77/labor-community-strategy-center-v-los-angeles-county-metropolitan-transportation-authority-plaintiffs-revised-statement-of-contentions-of-fact-and-law. Accessed May 17, 2025.
Copied!
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
CONSTANCE L. RICE
ROBERT GARCIA
BILL LANN LEE
MOLLY MUNGER
NAACP LEGAL DEFENSE AND
EDUCATIONAL FUND, INC.
315 West Ninth Street, Suite 208
Los Angeles, CA 90015
(213) 624-2405 >
ELAINE R. JONES
THEODORE M. SHAW
NAACP LEGAL DEFENSE AND
EDUCATIONAL FUND, INC.''
99 Hudson Street, 16th Floor *
New York, NY 10013 \
(212) 219-1900 ' • . 4
PAUL L. HOFFMAN
GARY L. BOSTWICK
100 Wilshire Boulevard, Suite 1000
Santa Monica, CA 90401
(310) 260-9585
E. RICHARD LARSON
MARK D. ROSENBAUM
ACLU FOUNDATION OF
SOUTHERN CALIFORNIA
1616 Beverly Boulevard
Los Angeles, CA 90026
(213) 977-9500
Attorneys for Plaintiffs
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
LABOR/COMMUNITY STRATEGY CENTER,
et al.,
CASE NO. CV 94-5936 TJH (Mcx)
Plaintiffs,
vs.
PLAINTIFFS’ REVISED STATEMENT
OF CONTENTIONS OF FACT AND
LAW
LOS ANGELES COUNTY METROPOLITAN
TRANSPORTATION AUTHORITY and
JOSEPH DREW,
etc.
Defendants.
Ill
III
III
III
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
TABLE OF CONTENTS
PART ONE
SUMMARY OF THE FACTS
I. INTRODUCTION....................................................................................................................... 2
II. BACKGROUND ....................................................................................................................... 3
A. Parties....................................................................................................................... 3
1. Plaintiffs.............................................................................................................. 3
2. Defendants......................................................................................................... 4
B. Procedural History Of The C ase ............................................................................ 6
1. Prior Proceedings........................................................................................ 6
2. MTA’s Failure To Comply With The T R O ............................................. 9
C. Background On MTA ...................................................................................... 10
1. MTA Funds And Operates Transit Services ............................................. 10
2. Eighty Percent Or More Of MTA’s Bus Riders Are Minority ................... 11
3. MTA’s Bus System Principally Serves Low-Income,
Transit-Dependent Residents................................................................... 12
4. MTA’s Bus System Provides Comparatively Low Subsidy Services
On Overcrowded Buses ........................................................................ 14
5. MTA Bus Operations Receive A Disproportionately Low Share Of
MTA Resources ...................................................................................... 16
6. MTA Reduced Bus Service In The Face Of Increasing Need ................... 17
III. MTA'S SPENDING AND SERVICES HAVE AN ADVERSE DISPARATE
IMPACT UPON THE MTA’S MINORITY BUS RIDERSHIP................................... 18
A. MTA Bus Riders Are Adversely Affected By The
Provision Of Disparate Public Subsidies ............................................................ 19
B. MTA Bus Riders Are Adversely
Affected By Disparate Fares ............................................................................... 22
C. MTA Bus Riders Are Adversely Affected By Disparate Levels
Of Overcrowding On B uses................................................................................. 24
D. MTA Bus Riders Are Adversely Affected By The
Provision Of Disparate Levels Of Police Security.............................................. 30
G:\MTA\MEDIATE\BLISS.TBL 1
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
E. Minority MTA Bus Riders Are Adversely Affected By The Provision Of
Disparate Subsidies And Service Compared To White MTA Bus Riders . . . . 35
IV. MTA HAS HISTORICALLY PROVIDED ITS MINORITY
BUS RIDERS INADEQUATE AND COSTLY SERVICE........................................... 38
A. The McCone Commission In 1965 Found That Bus Service In South
Central Los Angeles Was Inadequate And Prohibitively Expensive................. 38
B. MTA Failed To Remedy The “Prohibitively Expensive” Fares Criticized
by the McCone Commission ............................................................................... 41
C. MTA Failed To Comply With The McCone Commission's
Recommendations To Begin To Provide Adequate Bus Service ..................... 41
D. The Findings Of MTA's 1993 Inner City Transit Needs Assessment Study
And Other MTA Studies Echo The McCone Commission's Findings.............. 48
E. MTA Has Failed To Implement The Recommendations Of The Inner City
Transit Needs Assessment Study ........................................................................ 55
1. MTA Has Not Lowered Bus Fares In The Inner C ity .......................... 55
2. MTA Has Not Reduced Overcrowding Or Improved Inner City
Bus Service............................................................................................... 57
3. MTA Has Not Improved Security On Inner City Buses ...................... 62
V. IN THE LAST DECADE, MTA SHIFTED RESOURCES FROM THE BUS
SYSTEM TO DEVELOPMENT OF METROLINK AND MTA-OPERATED
RAIL LIN ES............................................................................................................................ 63
A. MTA Developed Rail Lines That Are Inefficient And Not Cost-Effective,
Diverting Financial Resources From Bus Operations......................................... 63
B. MTA Spent Nearly $1 Billion To Construct The Long Beach Blue Line . . . . 68
C. MTA Spent $1 Billion To Construct The Green Line ...................................... 72
D. MTA Plans To Spend $5.8 Billion To Construct The Red Line ..................... 74
E. MTA Plans To Spend Over $800 Million To Build The Pasadena Light
Rail Line Using Funds That Could Be Used On MTA Bus Operations .......... 75
1. Background ............................................................................................. 75
2. The MTA Board Voted To Use Discretionary Funds For The
Pasadena Line, Even While Contending That Bus Fare
Restructuring Was Necessary ................................................................ 77
3. The 1996 Designation Of Discretionary Funds for Construction......... 78
4. There Was Strong Dissent At The February 28 Board Meeting
Against The Pasadena Blue L in e ............................................................ 80
iiG:\MTA\MEDIATE\BLISS.TBL
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
5. MTA’s Plan To Issue Bonds To Finance The Pasadena L in e .............. 83
6. Issuing Bonds For The Pasadena Line Will Cause MTA To
Exceed Restrictions On Its Debt Load .................................................. 85
7. The Development Of The Pasadena Line Is Replete With
Irregularities ............................................................................................. 87
F. MTA Has Spent Hundreds Of Millions Of Dollars On Metrolink, A
Commuter Rail System That Provides Superior Service To An
Overwhelmingly White Ridership........................................................................ 89
1. The Metrolink Ridership Is Quite Small, Financially Well-Off And
Non-Transit-Dependent, And Overwhelmingly W hite .......................... 89
2. Metrolink Passengers Receive High Quality Service............................. 90
3. MTA Has Paid Hundreds Of Millions Of Dollars To Build And
To Operate Metrolink............................................................................... 91
4. The Metrolink Ridership Receives Millions Of Dollars Of
Additional Subsidies And Benefits Nowhere Set Forth In The
Metrolink/SCRRA B udgets.................................................................' . 95
a. Metrolink Stations Are Not Owned Or Operated By
Metrolink, But Primarily By The Local Jurisdictions
Served By M etrolink................................................................... 95
b. MTA Has Expended Millions Of Dollars To Reroute
Buses, To Create New Bus Feeder Systems, And
Otherwise To Make Commuting Easy For Metrolink
Passengers................................................................................... 98
c. Thanks To MTA Funding, Some Metrolink Passengers
Receive Free Transportation From Metrolink Stations To
Their Places Of Employment, And Some Passengers
Receive Subsidized Child Care T o o ........................................... 99
d. Through Its "Call For Projects," MTA Spends Millions Of
Dollars On Transit Projects Which Enhance Metrolink's
Commuter Rail Service ................................................................ 101
e. Most Metrolink Passengers Receive Large Transit
Subsidies From Their Employers.................................................. 102
5. Through The MTA/Metrolink Extension Of Rail Service Another
45 Miles To Lancaster, MTA Spent - And Continues To Spend -
Millions Of Additional Dollars On Metrolink ...................................... 102
6. MTA Has Absolute Control Over All MTA Funding Expended On
Behalf Of Metrolink Within Los Angeles County ............................... 105
G. MTA's Development Of Rail Lines Has Not Provided Efficient And
Effective Benefits To Minority Communities.......................................................106
inG:\MTA\MEDIATE\BLISS.TBL
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
MTA’s Predecessors RTD And LACTC Changed Plans That Developed
Rail In Minority Communities To Plans That Provided Service To The
Disproportionately White Suburbs ..................................................................... [ 08
VI. MTA DISPROPORTIONATELY ALLOCATES MILLIONS OF DOLLARS TO
MUNICIPAL BUS OPERATORS THAT PROVIDE QUALITY SERVICE TO
HEAVILY WHITE RIDERSHIPS........................................
A. The Municipal Bus Operators Serve A Ridership That Is
Disproportionately W hite......................................................................................113
B. The Municipal Bus Operators Offer Their Riders High Quality Services
Relative To The Services Given To The Riders of MTA Buses ..................... 114
C. MTA (LACTC), Through Its Bus Service Continuation Project, Helped To
Create Two Of The Largest Commuter-Express Municipal Bus Operators . . . 117
D. Through A Variety Of Creative Funding Programs, MTA Has Provided
Disproportionate Funding To - And Thus Has Helped To Maintain The
Low Fares And Better Service Of — The Municipal Bus Operators.................120
1. In The Late 1970s, MTA (LACTC) Adopted Its FAP Formula,
Through Which MTA (LACTC) Began to Funnel Millions Of
Dollars Of State And Federal Funds To The Municipal Bus
Operators ....................................................................................................120
2. In The Early 1990s, MTA (LACTC) Made Four More Municipal
Bus Operators Eligible For Millions Of Dollars Of Additional
Funding From M TA ................................................................................... 121
3. For FY 1995-96, MTA Allocated $77 Million In Operating Funds,
And Another $25 Million In Capital Funds To The Sixteen
Municipal Bus Operators ..........................................................................123
4. For FY 1995-96, MTA Allocated An Additional $15 Million To
The Municipal Bus Operators Through A Variety Of Arbitrarily
Established Funding Programs.................................................................. 126
5. MTA Also Funds The Municipal Operators Through Various
Other Ad Hoc Funding Measures..............................................................130
6. Through Its "Call For Projects," MTA In The Summer Of 1995
Granted Millions Of Dollars In Funding To A Variety Of Transit
Projects, Many Of Which Directly Or Indirectly Benefit The
Sixteen Municipal Bus Operators............................................................130
7. MTA Funds Not Just The Sixteen "Included" And "Eligible"
Municipal Bus Operators But Other Bus Operators In Los Angeles
County T o o ............................................................................................... 132
8. MTA, For FY 1995-96, Also Approved The Expenditure By Local
Jurisdictions Of Millions Of Dollars Of Proposition A & C Local
Return Funds, Thus Providing Even More Funds Benefitting The
Municipal Bus Operators ........................................................................133
G:\MTA\MEDIATE\BLISS.TBL i v
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
VII. DEPARTURES FROM REGULARITY ............................................................................135
A. MTA's Long Range Plans Are Economically Unrealistic ................................. 135
1. The 30-Year Plan Was Totally Unrealistic ...........................................136
2. The 20-Year Plan Also Is Economically Unrealistic.............................141
a. The 20 Year-Plan Does Not Evaluate Rail Projects That
The MTA Board Had Already Approved................................. 141
b. The Rail Projects In The 20-Year Plan Are Not Cost-
Effective Under The MTA's Own M easures...............................142
c. The Assumptions Concerning Federal Funding Set Forth In
The 20-Year Plan Are Just Plain Wrong ................................. 144
d. The 20-Year Plan Is Internally Inconsistent, And It
Misstates Costs And Revenues By Billions Of D ollars............146
e. The 20-Year Plan Embraces Two Inconsistent Assumptions
Concerning Population G row th.................................................... 146
f. The 20-Year Plan Does Not At All Address The Needs Of
Minority Transit-Dependent Bus R id ers ...................................... 148
B. MTA's Board of Elected Public Officials Has Politicized Transportation
Allocations ............................................................................................................. 149
1. According To Then-CEO Franklin White, MTA’s Discretionary
Dollars Should Be Used To Make The Bus System Better .................149
2. According to Supervisor Yaroslavsky, People "In And Outside The
Agency . . . Consider The MTA’s Tax-Funded Coffers As Their
Personal Candy Jars" ............................................................................ 150
3. According To Mayor Riordan, The MTA Board Has Inherent
Conflicts That Make It Impossible For MTA To Meet The Needs
Of The People Of Los A ngeles................................................................ 152
C. Irregularities Have Marked MTA's Development Of Its Rail Program ............153
D. Bus Operations Have A Greater Impact On Regional Economic
Development Than Rail Development...................................................................161
E. Commuter Buses Serve Regional Transportation Needs At Lower Cost
Than Rail Development D oes.................................................................................162
F. Access To The Downtown Central Business District Does Not Justify
Fixed Guideway Rail Development....................................................................... 163
G. Irregularities Were Rampant During The 1994 Bus Fare Restructuring ......... 164
1. The MTA Board Committees That Studied Fare Restructuring Did
G:\MTA\MEDIATE\BLISS.TBL V
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Not Recommend I t ..................................................................................... 164
2. The Public Hearing Revealed Great Public Opposition,
Questioning the MTA's "Focusing Its Financial Resources On Rail
Development At The Expense of Bus Service."....................................168
3. The Staff Gave The MTA Board No Financial Options Other Than
To Restructure Bus Fares ..........................................................................171
4. MTA Officials Have Admitted That The Fare Restructuring Was
Not Necessary.............................................................................................176
VIII. MTA HAS THE RESOURCES TO IMPROVE BUS SERVICE AND
LOWER FARES .................................................................................................................. 180
A. MTA Receives, Allocates, And Spends Billions Of Dollars In Local, State,
And Federal Transportation Funds ........................................................................180
1. The MTA Drafted, Lobbied For, And Administers The Two One-
Half-Cent Local Sales Tax Measures Known As Proposition A
(1980) And Proposition C (1990)............................................................ 182
a. Proposition A Produces Hundreds Of Millions Of Sales
Tax Dollars For Transit Each Year .............................................183
b. Proposition C Also Produces Hundreds Of Millions Of
Sales Tax Dollars For Transit Each Y e a r ..................................... 185
2. MTA Has Locked Up Future Revenue Streams For Rail By
Issuing Long Term Bonds..........................................................................187
B. MTA Has And Could Aquire Many Millions of Dollars To Improve Its
Bus Service And To Lower Its Bus Fares ......................................................... 188
PART TWO
SUMMARY OF THE LEGAL ISSUES
I. OVERVIEW............................................................................................................................ 192
II. THE DISPARATE IMPACT CLAIM ................................................................................ 193
A. The Title VI Regulations Prohibit Disparate Impact Discrimination.............. 193
B. The Disparate Impact Standard ..........................................................................196
C. Plaintiffs Have Established a Prima Facie
Case Of Adverse Disparate Im pact................................................................... 198
1. Numerical Disparities Are Statistically Significant To Establish
The Prima Facie Case Under the Castaneda Standard..................................198
2. Plaintiffs’ Showing Of Adverse Disparate Impact Is
Statistically Significant................................................................................. 199
G:\MTA\MEDIATE\BLISS.TBL VI
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
a. Ridership Disparities Are Statistically Significant ..................... 199
b. Subsidy Disparities Are Statistically Significant ....................... 201
c. Disparities In Overcrowding, Security And Services Are
Statistically Significant ..............................................................202
3. MTA Invokes Invalid Population Comparisons To Circumvent
the Showing of Adverse Disparate Impact ................................................ 204
a. General Population Comparisons Are Invalid ............................ 204
b. Transit Corridor Populations Do Not Reflect Who Rides
The Trains ...................................................................................205
c. MTA Discriminates Against Minorities Even Though The
Majority Of Its Ridership Consists of Minorities .....................207
d. MTA Is Liable For The Disparate Impact Of Actions By
Agencies It Funds .......................................................................208
e. The Urban League Case Provides Defendants No Support . . . 209
D. Lack of Business N ecessity...................................................................................210
1. MTA Bears The Burden of Proving Business N ecessity ....................... 210
2. MTA Has Failed To Prove Business Necessity ......................................213
3. MTA’s Claims Are Wholly Insufficient Under the Business
Necessity Standard ...................................................................................215
E. Plaintiffs Have Demonstrated Less Discriminaroty Alternatives ....................... 216
1. Plaintiffs’ Proof of Less Discriminatory Alternatives ............................ 216
2. The Less Discriminatory Alternative Standard Properly Applies to
Public Transit ............................................................................................ 218
III. THE INTENTIONAL DISCRIMINATION CLAIM ....................................................... 220
A. The Arlington Heights Standard ..................................................................... 220
B. Proof of Intentional Discrimination .....................................................................220
1. Adverse Disparate Im pact......................................................................... 221
2. Historical Background .............................................................................. 221
3. Departures from Regularity .....................................................................222
CONCLUSION................................................................................................................................ 226
G:\MTA\MEDIATE\BLISS.TBL Vll
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
TABLE OF AUTHORITIES
Cases: Pages:
Albermarle Paper Co. v. Moody, 422 U.S. 405,
95 S. Ct. 2362, 45 L. Ed. 2d 280 (1975)................................................................ 211, 215, 217
Alexander v. Choate, 469 U.S. 287, 105 S. Ct. 712,
83 L. Ed. 2d 661 (1985)......................................................................................................... 197
Arlington Heights v. Metropolitan Housing Corp.,
429 U.S. 252, 97 S. Ct. 555, 50 L. Ed. 2d 450 (1977) ............................................................ 220
Atonio v. Wards Cove Packing Co., Inc., 10 F.3d 1485 (9th Cir. 1993) .................................. 216
Bazemore v. Friday, 478 U.S. 385, 106 S. Ct. 3000,
92 L. Ed. 2d 315 (1986)......................................................................................................... 219
Board of Education v. Harris, 444 U.S. 130,
100 S. Ct. 363, 62 L. Ed. 2d 275 ........................................................................................... 212
Bouman v. Block, 940 F.2d at 1211, 1225, 1238 (statistical table)
(9th Cir.), cert, denied, 502 U.S. 1005, 112 S. Ct. 640, 116 L. Ed. 2d 658 (1991)............ .. . 199
Bryan v. Koch, 627 F.2d 612 (2d Cir. 1980)............................................................................... 219
Campaign for Fiscal Equity, Inc. v. State of New York,
86 N.Y. 2d 307, 1995 N.Y. LEXIS 1145 (New York Ct. App. June 15, 1995) . . . 197, 219
Castaneda v. Partida, 430 U.S. 482, 496 n.17, 97 S. Ct. 1272,
51 L. Ed. 2d 498 (1977)...................................................................................... 198, 200, 207
Coalition o f Concerned Citizens v. Damian
608 F. Supp. 110, 127 (C.D. Ohio 1984) ............................................................................ 208
Columbus Board of Education v. Penick, 443 U.S. 449,
99 S. Ct. 2941, 61 L. Ed. 2d 666 (1979)............................................................................... 220
Committee for a Better North Philadelphia v. Southeastern Transportation Authority,
1990 Lexis 10895 (E.D. Pa. 1990), affd, 935 F.2d 1280 (3d Cir. 1991) .......................... 20
Elston v. Talladega County Board of Education,
997 F.2d 1394, 1412 (11th Cir. 1993)................................................................................... 212
Federal Deposit Ins. Corp. v. Henderson,
940 F.2d 465, 471 (9th Cir. 1991) ........................................................................................ 220
Furnco Constr. Corp. v. Waters, 438 U.S. 567, 578,
57 L. Ed. 2d 957, 98 S. Ct. 2943 (1978)............................................................................... 219
Garza v. County of Los Angeles, 918 F.2d 763 (9th Cir. 1990), cert, denied
498 U.S. 1028, 111 S. Ct. 681, 112 L. Ed. 2d 673 (1991).................................................. 193
Georgia State Conference of Branches of NAACP v.
State of Georgia, 775 F.2d 1403 ........................................................................................... 212
viiiG:\MTA\MEDIATE\BLISS.ATH
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Pages:
Griggs v. Duke Power Co., 401 U.S. 424,
91 S. Ct. 849, 28 L. Ed. 2d 158 (1971) ........................................... 192,210,211,215,216
Guardians Ass'n v. Civil Service Commission,
463 U.S. 582, 103 S. Ct. 3221, 77 L. Ed. 2d 866 (1983) ............................... 195, 196, 197
International Brotherhood of Teamsters v. United States,
431 U.S. 324, 97 S. Ct. 1843, 52 L. Ed. 2d 396 (1977) ..................................................... 210
Jeldness v. Pearce, 30 F.3d. 1220 (9th Cir. 1994) .................................................. 197, 198, 210
Larry P. v. Riles, 793 F.2d 969 (9th Cir. 1984).............. 196, 197, 199, 204, 210, 211, 215, 216
Latimore v. Contra Costa County, No. C-94-1257-SBA
(N.D. Cal.) (August 1, 1994)............................................................................... 197, 205, 216
Lau v. Nichols, 414 U.S. 563, 94 S. Ct. 786,
39 L. Ed. 2d 1 (1974).............................................................................................................. 194
Los Angeles Dept, of Water and Power v. Manhart,
435 U.S. 702, 98 S. Ct. 1370, 55 L. Ed. 2d 657 (1978) ..................................................... 218
Meek v. Martinez, 724 F. Supp. 888 (S.D. Fla. 1987) ..................................................... 197, 219
Moore v. Hughes Helicopter, 708 F.2d 475 (9th Cir. 1983)....................................................... 204
NAACP v. Wilmington Medical Center, Inc.,
91 F. Supp. 290 (D. Del. 1980), affd, 657 F.2d 1322 (3d Cir. 1981) ............................... 219
Nashville Gas Co. v. Satty, 434 U.S. 136,
98 S. Ct. 347, 54 L. Ed. 2d 356 (1977) ............................................................................... 215
New York Urban League, Inc. v. State of New York, 71 F.3d 1031 ...................... 209, 210, 212
Phillips v. Martin Marietta Corp., 400 U.S. 542, 91 S. Ct. 496,
27 L. Ed. 2d 613 (1971)......................................................................................................... 207
Robinson v. Adams, 847 F.2d 1315 (9th Cir. 1987), cert, denied,
490 U.S. 1105, 109 S. Ct. 3155, 104 L. Ed. 2d 1018 (1989)............................................. 204
Wambheim v. J.C. Penney Co., Inc., 642 F.2d 362 (9th Cir. 1988) ......................................... 215
Wards Cove Packing Co., Inc. v. Atonio, 490 U.S. 642,
109 S. Ct. 2115, 104 L. Ed. 2d. 733 (1989) ........................................................................ 216
Washington v. Davis, 426 U.S. 229, 96 S. Ct. 2040,
48 L. Ed. 2d 597 (1976)...................................................................................... 211, 220, 221
Wright v. Council o f City o f Emporia, 407 U.S. 451, 464-66, 92 S. Ct. 2196,
33 L. Ed. 2d 51 (1972)........................................................................................................... 207
Statutes: Pages:
G:\MTA\MEDIATE\BLISS.ATH IX
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
42 U.S.C. § 2 0 0 0 d .................
42 U.S.C. § 2000d-1 ............
42 U.S.C. § 2000d-4a............
42 U.S.C. § 2000e ( m ) ..........
42 U.S.C. § 2000e-2 (k)(l)(A)
49 U.S.C. App. § 1601 et seq.
49 U.S.C. App. § 1607 (f)(1) .
Title VI 42 U.S.C. § 2000d . .
Pages:
193, 219
. . . 193
. . . 208
. . . 210
. . . 216
. . . 214
. . . 214
Passim
G:\MTA\MEDIATE\BLISS.ATH X
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
PART ONE
SUMMARY OF THE FACTS
I. INTRODUCTION
1. The District Court previously reviewed the factual record in preliminary
injunction and summary judgment proceedings.
2. On September 21, 1994, the District Court held that, on the abbreviated
preliminary injunction record, plaintiffs had presented "more than sufficient evidence" to support
their disparate impact claims for preliminary relief and had “raised serious questions going to the
merits” on the claims of intentional discrimination:
Plaintiffs have presented the Court with more than sufficient
evidence to meet their burden of preliminarily showing that MTA's
actions have adversely impacted minorities; that MTA's actions
were not justified by business necessity; and that the MTA has
rejected less discriminatory alternatives.
. . . Through their evidence, plaintiffs raise serious questions going
to the merits of their disparate impact claims under Title VI, as
well as their intentional discrimination claim under Title VI, the
Fourteenth Amendment, and 42 U.S.C. §§ 1981 and 1983. A
serious question is one that is so substantial and difficult as to
warrant more deliberate investigation and, thus, creates a fair basis
for litigation.
Findings o f Fact and Conclusions o f Law 4-5 (Sept. 21, 1994) (citation omitted).
3. The Court rejected MTA’s defenses on the preliminary injunction record. The
factual record compiled by plaintiffs through discovery since then, consisting largely of
admissions contained in MTA documents and depositions of MTA officials, is considerably more
detailed and comprehensive. Both the disparate impact and intentional discrimination concerns
are considerably stronger in light of the full record.
4. The MTA reiterated its defenses in the form of a summary judgment motion
G:\mta\mediate\rg-bliss 2
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
submitted last fall after the close of discovery. In response, plaintiffs submitted a Statement of
Genuine Issues of Material Fact, with a set of supporting MTA documents and excerpts from
MTA official depositions as exhibits. The District Court denied the MTA’s summary judgment
motion on December 22, 1995.
II. BACKGROUND
A. Parties
1. Plaintiffs
5. Plaintiff Labor/Community Strategy Center is an advocacy and membership
organization whose purposes and activities include obtaining equity in the operation of the public
transportation system in Los Angeles County without respect to race, color, national origin,
disability, gender or income. Poor African-American, Latino and Asian (“minority”) members of
the Center as well as the activities of the Center are and will be adversely affected by the actions
challenged in this lawsuit. Amended Pretrial Conference Order at 1 (Jan. 4, 1996).
6. Plaintiff Bus Riders Union is an advocacy and membership organization of bus
passengers that also seeks to obtain equity in public transportation services in Los Angeles
County. Poor minority members of the Union as well as the activities of the Union will be
adversely affected by the challenged actions. Id. at 1.
7. Plaintiff Southern Christian Leadership Conference of Greater Los Angeles
County is a civil rights organization with a long history of advocating for the equal provision of
transportation services to all races, as exemplified by its central role in the sit-ins that
desegregated public transportation throughout the South in the Civil Rights movement. SCLC
promotes and advocates the equal provision of governmental services for African American and
other minority residents of Los Angeles County. Poor minority members of the SCLC as well as
the activities of the SCLC will be adversely affected by the challenged actions. Id.
8. Plaintiff Korean Immigrant Workers Advocates is a non-profit, community service
organization that provides assistance and services to Korean immigrant workers. KIWA
advocates against defendants' discriminatory transit system and for equitable treatment of poor
minority and other inner city users of Los Angeles mass transit. Poor minority members of
G:\mta\mediate\rg-bliss 3
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
KIWA as well as the activities of KIWA will be adversely affected by the challenged actions.
Id. at 1-2.
9. Plaintiff Maria Guardado is a sixty-year-old Latina resident of Los Angeles
County whose sole source of income is Social Security benefits. She owns no car and relies
upon MTA bus transportation as her sole means of transportation. She currently buys a monthly
bus pass. If MTA fully implements the July 1994 fare restructuring, she will have to cut back or
eliminate her trips to meetings and social events, and visits to friends and relatives. Friends and
relatives who use the MTA bus also will be unable to visit her. Plaintiff Guardado will be
adversely affected by the challenged actions. Id. at 2.
10. Plaintiff Ricardo Zelada is a Latino resident of Los Angeles County. He currently
takes home $500 per month in income. His is the sole income supporting his family of four and
he cannot afford to own, insure or maintain a car. He rides the MTA bus seven days a week and
relies on the bus to go to the market, to church and to visit his elderly and ailing mother. He
currently purchases a monthly bus pass. If MTA fully implements its July 1994 fare
restructuring, he will not be able to afford to visit his sick mother, go to social events, attend
church regularly, or travel with his wife, plaintiff Noemi Zelada, as discussed below. If he loses
his bus pass, he will be forced to shop for food and clothing at local stores where items are
much more expensive. Plaintiff Ricardo Zelada will be adversely affected by the challenged
actions. Id.
11. Plaintiff Noemi Zelada is a Latina resident of Los Angeles. She is a student who
rides the bus to school, to the market and to church. She currently buys a student pass for $25
per month. Although she can continue to buy the monthly pass as a student, she will be
deprived of the safety and comfort of travelling with her husband, plaintiff Ricardo Zelada, on
many trips if the fare restructuring is fully implemented because he can no longer buy a pass and
they cannot afford for him to take as many bus trips as he could with a pass. Plaintiff Noemi
Zelada will be adversely affected by the challenged actions. Id. at 2-3.
12. Plaintiff Pearl Daniels is an African American resident of Los Angeles County.
She earns approximately $18,000 each year as a hotel switchboard operator. She relies on MTA
G:\mta\mediate\rg-bliss 4
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
I.
Suit* 208
bus service as her sole means of transportation. Plaintiff Daniels cannot afford to own or
maintain a car and has not owned a car for over nine years. Plaintiff Daniels currently buys a
monthly bus pass and rides the bus seven days a week to go to work, shop for food, visit friends
and attend union meetings. If the July 1994 fare restructuring is fully implemented, she will
have to limit the number of bus rides she takes. She needs MTA bus service to buy food and
will have difficulty shopping for groceries as there are no supermarkets nearby. She will become
more isolated as she will be unable to visit her sister and friends. Plaintiff Daniels will be
adversely affected by the challenged actions. Id.
2. Defendants
13. Defendant Los Angeles County Metropolitan Transportation Authority is a joint
county and municipal body created by the California State Legislature to administer and plan
transportation services for Los Angeles County. Pursuant to state law, MTA is governed by a 13
voting member board that includes the five Los Angeles County supervisors, the mayor of Los
Angeles, three City of Los Angeles appointees and four representatives from outlying cities. Id.
14. MTA is the result of a 1993 merger between the former Southern California
Rapid Transit District ("RTD") and the former Los Angeles County Transportation Commission
("LACTC"). The MTA provides public transportation directly through its own operations and
indirectly by funding other local governmental transit operators in Los Angeles County. Id.
15. The MTA's budget in FY 1995-96 was $3.1 billion. It receives federal and state
funds and local sales tax receipts. MTA, 1995-96 Budget, M301108 at M301119; Amended
Pretrial Conference Order at 3 (Jan. 4, 1996).
16. Defendant Joseph Drew, MTA's current chief executive officer, is sued in his
official capacity. Defendant Drew was substituted for the MTA’s previous chief executive officer
Franklin White when MTA fired Mr. White in December 1995.
17. On May 6, 1996, the Board of Education of the Los Angeles Unified School
District (“LAUSD”) passed a resolution to support the efforts by the plaintiffs to secure an
efficient, safe, low cost, environmentally sound and equitable public transit bus service for its
III
5
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
students, their families and other low income, inner city bus riders. The LAUSD is responsible
for the public education of 650,000 K-12 students in the Los Angeles area. The LAUSD’s ethnic
makeup is 87% minority and 13% white. The LAUSD issues thousands of bus passes to
students who depend upon MTA buses to get to school, part-time jobs, internships, public
libraries, and recreational activities as their principal or only means of transportation.
Additionally, a significant number of parents depend upon MTA buses to go to and from work,
escort younger children to school, attend school meetings, take their children to the doctor, and
participate in family outings. LAUSD Resolution (May 6, 1996); LAUSD Amicus Brief (May 17,
1996). The District Court denied the LAUSD’s motion to file an amicus brief in June 1996.
B. Procedural History Of The Case
1. Prior Proceedings
18. The plaintiffs filed the complaint in this civil rights class action on August 3-1,
1994, seeking preliminary and permanent injunctive relief against defendants Los Angeles
County Metropolitan Transportation Authority ("MTA") and Franklin E. White, MTA's then-chief
executive officer. The complaint alleged that MTA violated the Fourteenth Amendment, 42
U.S.C. §§ 1981 and 1983, and Title VI of the Civil Rights Act of 1964, 42 U.S.C. § 2000d, by
intentionally discriminating against racial and ethnic minority groups and perpetuating a pattern
of racially discriminatory delivery of transportation services. The complaint also alleged that, as
a recipient of federal funds, the MTA violated the implementing Title VI regulations, codified by
the United States Department of Transportation ("DOT") at 49 C.F.R. Part 21, by maintaining
transportation policies that disproportionately impact racial and ethnic minorities without a
justifying business necessity and without regard to less discriminatory alternatives. Complaint
(Aug. 31, 1994). Plaintiffs filed the First Amended Complaint with leave of Court on March 26,
1996.
19. After a hearing on September 1, 1994, the Court entered a temporary restraining
order that restrained defendants from raising cash bus fares from $1.10 to $1.35 and eliminating
bus passes that provide unlimited bus use for $42 per month. Temporary Restraining Order
(Sept. 1, 1994).
G:\mta\mcdiate\rg-bliss 6
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
2 0 . After a second hearing, the Court entered a preliminary injunction enjoining the
defendants from raising fares and eliminating monthly bus passes. Findings o f Fact and
Conclusions o f Law re: Preliminary Injunction (Sept. 21, 1994). The Court found that the
proposed fare restructuring would "cause minority bus riders substantial losses of income and
mobility that, for a significant number, will result in the loss of employment and housing, and
the inability to reach medical care, food sources, educational opportunities, and other basic needs
of life." Id. at 1-2. The Court held that the balance of hardships tips decidedly in plaintiffs'
favor because any harm to the defendants from enjoining the fare changes pales in comparison to
the harm to plaintiffs if the fare changes were implemented and that plaintiffs have raised serious
questions regarding both their disparate impact and intentional discrimination claims. Id. at 4-5.
21. The Court contrasted MTA's decision to restructure bus fares to the detriment of
the minority poor while contemporaneously proceeding with rail projects that serve a
disproportionate share of white riders. The Court found that:
On July 1, 1993, MTA's Operations Committee was given
an internally produced report which concluded that the inequitable
service provided to inner city areas, which are overwhelmingly
minority and poor, stemmed from "the absence of adequate public
funds." The report identified a significant need for transit service
improvements and noted that inner city residents are extremely
dependent on public transit, have very intense transit use, and
suffer from significantly more limited access to transportation
alternatives. The report documented that "service delivery
problems have more severe impact in the [ijnner [cjity than in
most other areas of the County." The report concluded that MTA
maximizes the benefits of the highly cost-effective inner city bus
lines, in part, by routinely permitting overcrowding levels of 140%
of capacity.
At an MTA Board meeting in August, 1993, plaintiff
G:\mta\mcdiate\rg-bliss 7
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Labor/Community Strategy Center formally requested that the
MTA impose a moratorium on all rail projects, which allegedly
serve a non-minority ridership, in light of the Board's plan to raise
bus fares and cut service. MTA Board member Villaraigosa urged
his fellow MTA Board members to avoid the need to harm bus
service later by refusing to approve a $59 million discretionary
fund allocation to plan the Pasadena rail project. The MTA Board,
ignoring Mr. Villaraigosa and the plaintiff, voted to allocate the
$59 million to that project. Plaintiffs claim that the $59 million
should have been spent on bus services to avert the bus fare
increases and pass elimination.
White received a staff memorandum, dated January 21,
1994, which concluded that the proposed fare increases and pass
elimination would disproportionately effect minority and poor
transit users. The memorandum acknowledged that "[f]or the most
part, cash and most pass categories are comprised of people of
color with lower household incomes" and that "the ethnic mix of
non-senior disabled pass holders is equivalent to that of our
general ridership." The report went on to state that general
ridership of the buses is 80 percent minority and "profoundly
poor" and is the population that would be most adversely affected
by a fare hike and pass cut.
On July 13, 1994, the MTA Board voted to increase the
one way cash bus fare by 23% from $1.10 to $1.35, to eliminate
the bus pass that provided unlimited bus use for $42.00 a month,
and to retain 90c single-ride tokens.
On July 20, 1994, the MTA Board voted to spend another
$123 million on the rail project designed to serve Pasadena.
G:\mta\mcdiatc\rg-bliss 8
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Id. at 2-3 (brackets by the Court, paragraph numbers omitted).
22. The defendants filed a notice of appeal on September 30, 1994, which was
withdrawn and ultimately dismissed on December 6, 1994.
23. On January 25, 1995, the Court entered a stipulated order which modified the
preliminary injunction by allowing the cash fare to be raised from $1.10 to $1.35 and by
allowing the price of the monthly pass to be raised from $42 to $49. As modified, the
preliminary injunction remains in effect pending trial.
24. On March 7, 1995, the Court certified this action as a class action on behalf of
"[a]ll poor minority and other riders of MTA buses who are denied equal opportunity to receive
transportation services because of the MTA's operation of a discriminatory mass transportation
system," a class consisting of approximately 350,000 individuals.
25. The Court denied MTA’s motion for summary judgment on December 22, 1995.
2. MTA's Failure To Comply With The TRO
26. Although MTA ordinarily sells its regular monthly passes up through the first ten
days of each month, MTA did not do so in September 1994, MTA Admission No. 1 (admitted),
even though MTA was under the Court’s Order to do so.
27. On September 2, after pass sales had already begun pursuant to the temporary
restraining order, MTA Deputy Chief Executive Officer LaVeme Kimball gave instructions not to
sell passes. MTA ceased sales of the September bus pass the next day, September 3, and the
MTA did not resume pass sales until September 9. There were no administrative reasons for
MTA to fail to comply with the Court's order. Dep. o f Thomas Longsden at 109, 118 (July 28,
1995).
28. Mr. Kimball testified at his deposition that he was waiting for the outcome of an
appeal in this case, although there was no stay in effect. Dep. of Kim Kimball 12, 14-24, (Oct.
13, 1995) (Vol. 1); Dep o f Kim Kimball 81-153 (Jan. 9, 1996) (Vol. 2). A party must obey a
temporary restraining order even if an appeal is pending. See, e.g., Walker v. City of
1. On May 15, 1996, defendants served Defendants’ Response to Plaintiffs’ Third Request to
Admit. Specific admissions in that document are cited herein as “MTA Admission N o .---- .
G:\mta\mediate\rg-bliss 9
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Birmingham, 388 U.S. 307, 315 (1967).
29. In sum, MTA sold regular monthly passes for September 1994 only on September
2, 9, and 10. MTA Admission No. 2 (admitted). Under the terms of the Court’s TRO, MTA
should have sold the passes on September 2-10.
30. Although MTA presently sells passes, it has taken administrative steps not to
encourage pass sales as much as the sale of 90 cent tokens. MTA has launched an advertising
campaign to increase public awareness of the availability of tokens, but has taken no comparable
efforts to make known the availability of passes. The MTA offers retail outlets the same 65 cent
commission on a nine dollar roll of tokens as a 49 dollar monthly pass. The MTA requires that
pass sales outlets sell a minimum of 100 passes per month, but imposes no minimum token sales
level. MTA has not included passes in its pilot programs to sell tokens at McDonald's
restaurants and local banks. Dep. o f Thomas Longsden at 36-37, 61-64, 73 (July 28, 1995J.
C. Background On MTA
1. MTA Funds And Operates Transit Services
31. MTA’s Mission Statement, adopted by the MTA in February 1994, states:
The mission of the Los Angeles County Metropolitan
Transportation Authority is to design, construct, procure, operate
and maintain a safe, reliable, affordable and efficient transportation
system that increases mobility, relieves congestion and improves
air quality, and meets the needs of all Los Angeles County
residents.
Amended Pretrial Conference Order at 5 (Jan. 4, 1996).
32. MTA provides for transit services in Los Angeles County in two ways: the MTA
directly operates its own transit system, and it also allocates funding to Metrolink and to
numerous municipal bus operators in Los Angeles County.
33. The largest single transit operator in Los Angeles County, MTA operates an
extensive bus system throughout Los Angeles County.
34. MTA currently operates three rail operations, the Blue, Red and Green Lines.
G:\mta\mediatc\rg-bliss 10
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
The Blue Line is a 22-mile light-rail line with 22 stations that connects Long Beach to downtown
Los Angeles. The Red Line is a partially completed heavy-rail subway that runs approximately
3.2 miles from downtown Los Angeles west to Mac Arthur Park. The Green Line, which
opened in August 1995, is a light-rail line that runs on the median of the Century Freeway (I-
105) between Redondo Beach and Norwalk.
35. MTA distributes federal, state, and local funds to the Southern California
Regional Rail Authority (“SCRRA”), also known as Metrolink, and to numerous municipal bus
operators in Los Angeles County.
36. MTA bus system is composed of 128 regularly scheduled parent bus routes and
55 regularly scheduled branch routes. Although the service area includes all of Los Angeles
County, MTA bus operations are largely confined to the southern portion of Los Angeles
County. Additionally, a limited amount of service is provided across the Ventura, San Bemadino
and Orange County lines by a small number of MTA bus routes. MTA, A. Leahy, Status Report
on MTA Bus System (July 2, 1993), M514360 at M514368-69 (with report entitled "Status Report
on MTA Bus System, Phase I - June 1993" (July 1993), M514364.
2. Eighty Percent Or More Of MTA’s Bus Riders Are Minority
37. According to a 1994 MTA report, "A typical MTA rider is a person of color
(Latino or African-American), in her twenties, with a household income under $15,000 and no
car available to use in lieu of public transit." Eighty percent of MTA passengers are minority.
MTA riders are Latino and African American in percentages that significantly exceed their
representation in the overall county population. Latinos comprise 47 percent and African
Americans comprise 23 percent of all MTA riders. Whites are only 19 percent of all MTA
riders, although they comprise over 40 percent of the county population. MTA, Comparing the
Demographic Composition o f MTA Riders With the Population o f Los Angeles County (Jan. 20,
1994), 008406 at 008407-09.
38. In 1995 the MTA reported that its bus ridership was 81 percent minority and 19
percent white. While 11 percent of County population lived in households without cars, 51
percent of bus riders did. MTA, Metro Bus System Workshop (Sept. 14, 1995), M803782 at
G:\mta\mcdiatc\rg-bliss 11
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
M803 790.
39. Demographic information of MTA bus riders from 1991-93 showed that 82
percent were non-white and 18 percent white. The sample of 1.17 million riders was 47.0
percent Latino, 22.7 percent black, 18.3 percent white, 8.1 percent Asian, 1.5 percent Native
American and 2.4 percent other. MTA, Demographic Info o f MTA Bus Riders: 1991-1993,
Ethnicity (April 15, 1994), 007677. MTA statistics show that 50 percent of bus riders have no
access to an automobile. Eighty percent of the bus riders without access to a car were non
white. MTA, Demographic Info o f MTA Bus Riders: 1991-1993 Number of Cars (April 15,
1994) , 007679; MTA Demographic Info o f MTA Bus Riders: 1991-1993, Ethnicity by Number of
Cars (April 15, 1994), 007681.
40. Minority ridership is probably higher than MTA indicates because of MTA's
undercounting of minorities. Brian Taylor, Martin Wachs, et al., Variations in Fare Payment
and Public Subsidy by Race and Ethnicity: An Examination of The LAMTA, at 8-10 (Nov. 5,
1995)
41. According to MTA Board member and Los Angeles Mayor Richard Riordan:
Currently 50 percent of the MTA's riders rely on the top twenty of
MTA's 185 bus lines. Each day 50,000 riders crowd the Wilshire
Blvd. Line, much greater than the number of persons who ride the
Metro Blue Line from Long Beach to Los Angeles. MTA
resources are not targeted to providing the majority of transit
riders with a system which is safe, clean, comfortable and reliable.
Letter from Los Angeles Mayor Richard Riordan to MTA Chairman Larry Zarian (Sept. 11,
1995), M803752.
3. MTA’s Bus System Principally Serves
Low-Income. Transit-Dependent Residents
42. Los Angeles County is an urban area of approximately 4,000 square miles,
consisting of 88 cities and a number of unincorporated areas, with a total population of almost
nine million. Because of its large size and low density development, the mobility needs of its
G:\rn ta\mc<Jiate\rg-bliss 12
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
residents are greater than other metropolitan areas. The automobile strongly influences life in
Los Angeles, with the County's freeways symbolizing the far-ranging mobility of the area's
population. Report o f the Independent Commission on the Los Angeles Police Department at 21-
22 (7992); Testimony of Martin Wachs and Brian Taylor.
43. Only 11 percent of Los Angeles County's population is dependent on mass transit
because their poverty precludes access to an automobile. MTA, Comparing the Demographic
Composition of MTA Riders with the Population of Los Angeles County (Jan. 20, 1994), 008406
at 008409. Most of this population is minority.
44. Fully 51 percent of MTA riders are transit dependent, without access to a car.
MTA, Metro Bus Customers: Demographics (Sept. 14, 1995), M803790.
45. "MTA riders are profoundly poor and dependent on some form of public
transportation for their mobility needs." Approximately 60 percent have annual household ‘
incomes of $15,000 or less, while only 21 percent of all county residents do so. Over 80 percent
of MTA riders have annual household incomes under $30,000. In contrast, less than 50 percent
of all county residents have household incomes under $30,000. Only 10 percent of MTA riders
earn household incomes between $30,000 and $50,000, while a quarter of the county population
does. MTA, Comparing the Demographic Composition of MTA Riders with the Population of
Los Angeles County (Jan. 20, 1994), 0008406 at 0008407-09.
46. Riders who use monthly passes or pay cash, the groups most affected by the July
1994, fare restructuring, are disproportionately poor. "For the most part, cash and most pass
categories are comprised of people of color with lower household incomes." Fully 59 percent of
cash riders and 55 percent of regular monthly pass riders have annual household incomes of less
than $15,000. Express pass riders have higher incomes and are disproportionately white. Senior
and disabled pass riderships were disproportionately white. MTA Fare Restructuring Across
Demographic Categories (Jan. 21, 1994), 008401 at 008402-04; MTA, Statistical Charts
(undated), M1012004 at M1012005; Dep. o f Brian Hyman at 37-39 (June 29, 1995); Dep. of
Dana Woodbury at 494-500 (Aug. 18, 1995) (Vol. 4), .
47. Although the great bulk of MTA riders are minority, transit-dependent, low-
G:\mta\mwJiate\rg-bliss 13
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
income passengers, it was not until September 1995 — a year after the Court's temporary
restraining order — that a motion was presented to the MTA Board that "the Board adopt in
concept that the transit dependent have the highest priority for MTA services and resources."
Letter from Los Angeles Mayor Richard Riordan to MTA Chairman Larry Zarian (Sept. 11,
1995), and attached Motion, M803752 at M803756.
4. MTA’s Bus System Provides Comparatively
Low Subsidy Services On Overcrowded Buses
48. Prior to the July 1994, fare restructuring, the MTA bus operations had the lowest
operating subsidy per passenger-mile of the 20 largest operators in the United States, 38 percent
under the average of the other large urban bus operators. The MTA, on the other hand, had the
fourth highest fare box recovery ratio of the largest urban bus operators, 24 percent over the
average of the other largest urban operators. MTA, A Look At The MTA (Jan. 1994), 800042A at
800046A; MTA, Marvin Holen, Bus and Rail Fares (July 11, 1994), M329396 at M329407.
49. MTA is one of the most highly utilized transit systems in the nation. The latest
Section 15 data from the Federal Transit Administration indicates that, in 1993, the MTA and the
New York City Transit Authority were virtually tied as the most utilized among the 21 largest
operators in the nation, at 55 boardings per hour. This was 40 percent higher than the average of
the largest motor bus operators, and 52 percent higher than the average of local operators. MTA,
A. Leahy, Metro Bus Operations Performance for the Third Quarter o f Fiscal year 1995 (July
24, 1995), M805545.
50. MTA has the greatest transit usage, measured by passenger-miles, of the 20
largest urban bus operators. In fiscal year 1991, MTA's predecessor RTD provided
1,617,000,000 passenger-miles of service. MTA, Additional Comparative Performance Data for
20 Largest Operators and Local Operators (Sept. 15, 1993), M302891 at M302893-900; MTA, A
Look At The MTA (Jan. 1994), 800042A at 800053A.
51. MTA produces more transit utilization per bus than any other large urban bus
operator, 70 percent over the average of its peers. MTA, A Look At The MTA (Jan. 1994),
800042A at 800046A; MTA, Marvin Holen, Bus and Rail Fares (July 11, 1994), M329396 at
G:\mta\mcdiate\rg-hliss 14
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
M329409.
52. Of the 20 largest urban transit operators, MTA had the third lowest cost per
passenger-mile. MTA's cost per passenger-mile of $0.35 was 29 percent under the $0.51 average
cost of the other 19 operators. MTA, A Look At The MTA (Jan. 1994), 800042A at 800051A;
MTA, Marvin Holen, Bus and Rail Fares (July 11, 1994), M329396 at M329409.
53. While MTA's fare per passenger mile in 1993 was 79 percent of the average of
the largest transit operations in the United States, MTA's cost per passenger mile was only 65
percent of the average of its peers. MTA's subsidy per passenger mile was 40 percent lower than
the average of its peers. Its 32.9 percent farebox recovery ratio was 22 percent higher than the
average of its peers. Amended Expert Report and Response to Report o f Robert L. Peskin by
Thomas A. Rubin (Jan. 1, 1996), E100061.
54. According to former RTD Chief Financial Officer Thomas Rubin, "If the test in
setting fares is comparisons to costs and fares of peers, it appears that MTA fares in 1993 were
high and, further, that a fare decrease appears to be far more justifiable than a fare increase." Id
at El 00061.
55. As MTA concedes, the high cost-effectiveness of its bus operations means very
poor service for its bus riders:
The main reason why the District rates high in cost-effectiveness
and productivity measures is its extremely high average passenger
load (annual passenger-miles/annual revenue vehicle miles), 43
percent over the average of its peers. . . . This high average
passenger loading is even more impressive when one considers
that the District is very high nationally in hours per bus — in other
words, the District carries more riders mid-day, evenings, and
weekends than other operations do at peak. These results indicate
that:
• The District's high cost-effectiveness and
productively means low comfort and quality of
G:\mta\mediate\rg-bliss 15
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
service score — for example, the District has far
more standees than any of its peers.
• Los Angeles has the largest unmet bus transit
demand in the United States.
* * *
• Unfortunately, another way of looking at the
District's cost-effectiveness is that we spent less to
move a passenger one mile than everyone else.
This has major impact on the quality of the service
that the District provides to its riders.
MTA, A Look At The MTA (Jan. 1994) (ellipsis and asterisks added), 800042A at 800053A.
56. In the transit industry, a bus route that carries 10,000 riders on average weekday
is a very highly utilized route. In 1992, the MTA operated 22 routes that carried over 20,000
riders on an average weekday. MTA Line 20 (Wilshire Boulevard) carried a daily average of
approximately 58,000 riders, and MTA Line 204 (Vermont Avenue) carried an average of 55,000
passengers. When MTA's busiest routes are compared with the busiest lines on 14 of the other
largest bus transit operators, the RTD's 22nd busiest line carried more passengers than the busiest
line of the sixth largest of its peers. MTA, A Look At The MTA (Jan. 1994), 800042A at
800061A-62A.
5. MTA Bus Operations Receive A Disproportionately
Low Share Of MTA Resources__________________
57. Focusing on MTA alone, MTA buses carry 94 percent of MTA passengers, but
MTA bus operations receive less than a third of total MTA capital and operating expenditures.
In 1992, 29.1 percent of MTA's total $2.6 billion budget was devoted to bus ($752 million out of
$2,583 billion). Fully 70.9 percent of MTA's 1992 budget was devoted to MTA rail programs,
which serve six percent of MTA ridership. MTA, Los Angeles County Transit Total Expenditures
By Mode (undated), 800159; Testimony of Thomas Rubin.
58. Focusing on MTA, Metrolink, and other municipal operators, in 1992 all of the
G:\mta\mediate\rg-bliss 16
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
rail lines (the Blue, Red and Metrolink lines) combined carried less than four percent of Los
Angeles county transit riders, fewer than 25,000 passengers: the Blue Line carried 2.4 percent of
the County's annual ridership, the Red Line carried 0.8 percent, and Metrolink commuter rail
carried 0.4 percent. MTA buses carried 80.8 percent and other municipal operators carried 15.6
percent of passengers. Only 3.6 percent of all County transit passengers were rail riders; 96.9
percent were bus passengers. Rail lines, however, received 71 percent of MTA capital and
operating resources. MTA, Los Angeles County Transit Total Expenditure By Mode (undated),
800159; MTA, Los Angeles County Transit Ridership by Mode/Operator (undated), 800160;
Testimony o f Thomas Rubin.
59. MTA's 20-Year Plan, adopted in 1995, allocates 59.6 percent non-Metrolink
subsidies to rail, and 41.4 percent to bus over the entire period of the Plan. For these subsidies,
MTA anticipates that rail lines will carry 18.5 percent of passenger fares in the final year of the
Plan, and 14.5 percent over the entire period. In contrast, MTA anticipates bus lines will carry
81.5 percent of the passengers fares in the final year of the Plan and 85.6 percent over the entire
period. Amended Expert Report and Response to "A Report by Jeffrey M. Zupan" by Thomas A.
Rubin (Jan. 1, 1996), E1000379.
6. MTA Reduced Bus Service
In The Face Of Increasing Need
60. In 1980, Los Angeles County voters passed Proposition A, a one-half cent sales
tax dedicated to transit. At the beginning of the 1983 fiscal year, after several years of annual
fare increases (1980, 55 cents; 1981, 65 cents; 1982, 85 cents), MTA's predecessors RTD and
LACTC lowered the cash fare to 50 cents over the next three years by allocating 20 percent of
Proposition A tax receipts to fare subsidies, as required by Proposition A itself. Over these three
years, bus ridership rose over 40 percent, from 354 million annual riders to 497 million annual
riders, although bus service increased only 1.5 percent. MTA, A Look At The MTA (Jan 1994),
800042A at 800077A-78A.
61. The MTA has decreased bus service dramatically in recent years. The MTA
reduced the peak bus fleet from 2,200 in 1985 to 1,750 buses in 1992. From a peak in 1988 of
G:\mla\mcdiate\rg-bliss 17
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
93,000,000 revenue service miles, MTA reduced revenue services miles to 81,800,000 revenue
service miles in 1993. MTA's South Central area experienced a 16 percent decrease in boardings
between 1991 and 1994. MTA, Trends: Ridership and Service Level (Sept. 14, 1995), M803786;
MTA, A Look At The MTA (Jan. 1994), 800042A at 800079A-80A; MTA, Status Report on
Ridership and Service Level Trends in the Second Supervisorial District (Aug. 31, 1994),
M331392 at M331393.
62. MTA's Operations Planning Department reported that for FY 1987-88 through FY
1992-93, systemwide patronage declined by 8 percent in the period, "due largely to a fare
increase implemented in FY 1989 and accompanying service reductions." MTA, Status Report on
MTA Bus System (July 2, 1993) with attached report entitled "Status Report on MTA Bus System,
Phase I - June 1993 (July, 1993), M514364), M514360 at M514374-75.
63. While the number of bus passengers and the bus service provided by MTA -
decreased, the population of Los Angeles County has increased. From 1985 to 1992, the County
population increased 13 percent from 7,953,000 to 8,989,000. In that period, per capita
utilization of RTD bues fell 28 percent, largely as a result of the fare increases and the declining
local bus service. MTA, A Look At The MTA (Jan. 1994), 800042A at 800081A-85A.
64. Beginning in fiscal year 1986, the Proposition A funds used to subsidize the 50
cent bus fare were reallocated to rail construction. RTD increased the fare to 85 cents in fiscal
year 1986, and to $1.10 in fiscal year 1989. Ridership decreased. The drop in bus boardings
coincided with the shift of funds to rail. By fiscal year 1993, the annual bus boardings had
dropped to 375 million annual riders. MTA, A Look At The MTA (Jan. 1994), 80042A at
800077A-78A.
m . MTA'S SPENDING AND SERVICES HAVE AN ADVERSE DISPARATE
IMPACT UPON THE MTA’S MINORITY BUS RIDERSHIP___________
65. MTA’s actions have adversely impacted minorities in the following v/ays:
• Discrimination against MTA minority bus riders
compared to the MTA’s vast overspending on its
rail projects in general;
G:\mta\mediate\rg-bliss 18
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
A.
• Discrimination against MTA minority bus riders
compared to the disproportionately white ridership
served by the MTA Red Line and by the MTA
Blue Line;
• Discrimination against MTA minority bus riders
compared to white ridership on the MTA’s well-
funded Metrolink commuter rail service;
• Discrimination against MTA minority bus riders
within the MTA’s own bus operations; and
• Discrimination against MTA minority bus riders
compared to the disproportionately white ridership
served by the MTA-funded suburban bus operators.
MTA Bus Riders Are Adversely Affected By The
Provision Of Disparate Public Subsidies________
66. The total subsidy, aggregating operating and capital subsidies, of the different
modes of transportation funded or operated by the MTA in 1992 was:
Mode Total Subsidy per Passenger
Metrolink $21.02
Blue Line 11.34
Red Line 2.92
Bus 1.17
The capital subsidies were commuter rail, $17.19, Blue Line $8.27, Red Line $2.63 and bus
$0.25. The operating subsidies were commuter rail $3.83, Blue Line $3.07, Red Line $0.29 and
bus $0.92. MTA, A Look At The MTA (Jan. 1994), 800042A at 800Q72A-73A.
Ill
III
III
III
G:\mta\mediate\rg-bliss 19
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
67. Accounting for differing average trip lengths of the modes, the total subsidies per
passenger-mile by mode in 1992 were:
Mode Total Subsidy Per Passenger-mile
Blue Line $1.25
Red Line 0.83
Metrolink 0.70
Bus 0.31
The capital subsidies were Blue Line $0.91, Red Line $0.75, Metrolink $0.57 and $0.07 bus.
The operating subsidies were Blue Line $0.34, Red Line $0.08, commuter rail $0.13 and bus
$0.24. The same total subsidy provided 100 average bus passenger trips of 3.8 miles, six
average commuter rail trips of 27.8 miles, 10 average Blue Line trips of 9.4 miles, or 40 average
Red Line trips of 3.5 miles. MTA, A Look At The MTA (Jan. 1994), 800042A at 800073A.-74A.
68. Taxpayer subsidies are necessary for public transit operators to cover all costs in
excess of revenues. Because almost all transit service operates at a loss, large, ongoing subsidies
are required. "Nationally, taxpayers subsidize approximately two-thirds (65.3 percent) of total
public transit costs. In other words, for each dollar collected in fares, advertising, and other
income, transit systems require approximately two dollars in local, state and federal subsidies to
operate.” Brian Taylor, Martin Wachs, et al., Variations in Fare Payment and Public Subsidy by
Race and Ethnicity: An Examination of the LAMTA, at 2-3, 18, (Nov. 5, 1995), E100567 at
E l00569-70, E l00585.
69. “Nationwide, close to 90 percent of transit capital costs (expenses associated with
the purchase of such items as vehicles, equipment, and real estate) are subsidized; and over half
(58 percent) of transit operating costs (ongoing expenses such as employee salaries and fuel) are
subsidized." Id. at 3.
70. Including capital costs is especially important in intermodal analyses because they
can vary by orders of magnitude between rail and bus service. The cost of rails, catenary,
tunnels, yards, etc. are far higher for trains operating in partially or fully exclusive rights of way
than for buses that share established street systems with automobiles. Red Line construction
G:\mta\mcdiate\rg-bliss 2 0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
costs, for example, are in excess of $250 million per mile, and new rail cars are typically $1
million each. Buses, on the other hand, cost between $250,000 and $300,000 each. Id.
71. Comparisons between the operating costs of bus and rail ignore the fact that
operating costs constitute the majority of the total bus costs while only a small part of total costs
of rail. All operating costs in Los Angeles County are 79 percent of total bus costs, 10 percent
of total Red Line costs, 27 percent of total Long Beach Blue Line costs, and 18 percent of total
Metrolink costs. Leaving out the most significant part of rail costs — capital costs — provides an
inaccurate picture of the cost effectiveness of rail operations. Amended Expert Report and
Response to Report o f Robert L. Peskin by Thomas A. Rubin (Jan. 1, 1996), E l00061.
72. In July 1993, the MTA offered the following explanations of the "subsidy per
passenger mile" statistical measure, noting that "the heavy utilization of MTA bus service
coupled with relatively high passenger fares has resulted in a very low net cost for each "
passenger mile."
This value is a function of line level fully loaded operating
cost less passenger revenue divided by the total number of
passenger miles generated. This is a measure of the cost
efficiency of service.
It should be noted that the MTA ranks at or near the top
compared to the twenty largest transit operators in the nation
relative to this efficiency measure. While the MTA has relatively
higher operating costs, the heavy utilization of MTA bus service
coupled with the relatively higher passenger fares has resulted in a
very low net cost for each passenger mile.
MTA, A. Leahy, Status Report on MTA Bus System (July 2, 1993), M514360 at 514378, and
attached report entitled "Status Report on MTA Bus System, Phase I - Status o f the Present bus
System," M514363.
73. Modal subsidy disparities understate the differences between bus-rail subsidies in
Los Angeles because rail lines are generally located only in the busiest corridors. The MTA's
G:\mta\mcdiate\rg-bliss 21
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
most "cost-effective" bus line, measured by subsidy per passenger, is MTA Line 204 (Vermont
Avenue) with a subsidy of 34 cents. (There were six other bus lines with per-passenger
subsidies of less than 50 cents). The Metrolink commuter rail subsidy of $21.02 is 62 times that
of Line 204 subsidy, Blue Line's $11.34 subsidy is 33 times that of the Line 204 subsidy, and
the Red Line's $2.92 subsidy is almost nine times the Line 204 subsidy. MTA, A Look At The
MTA (Jan. 1994), 800042A at 800099A-100A.
74. MTA is not the only provider of bus transit in Los Angeles County. MTA’s
predecessor, the RTD, reported to its Board in July 1992 that an analysis of bus operators in Los
Angeles County showed that the RTD "generates the highest amount of revenue among all
operators surveyed" and that RTD's "net taxpayer cost based on service provided to the public is
among the lowest in the area." RTD, Alan Pegg, Receive and File Statistical Reports Showing
District Performance in Comparison to Los Angeles Basin Municipal Operators (July 16, 1992),
001953 at 001959.
75. MTA's predecessor RTD in 1992 had the second lowest subsidy per passenger-
mile ($0.21) of the nine Los Angeles public transit operators providing primarily local bus
service. The average subsidy per passenger of the eight other bus operators was $0.31. MTA's
subsidy was a third lower than the average. MTA, Additional Comparative Performance Data for
20 Largest Operators and Local Operators (Sept. 15, 1993), M302891 at M302904; MTA, A
Look At The MTA (Jan. 1994), 800042A at 800055A, 800057A-58A.
B. MTA Bus Riders Are Adversely
Affected Bv Disparate Fares
76. The MTA's base cash fare of $1.10 in 1992 was already the highest fare of all
Los Angeles Municipal transit operators. The other base fares ranged from Foothill Transit's 85<t
fare, to Gardena's 20c fare, to Commerce’s free fare. The average base fare of the non-MTA bus
operators was 50c. MTA, Additional Comparative Performance Data for 20 Largest Operators
and Local Operators (Sept. 15, 1993), M302891 at M302902.
77. In the course of labor negotiations in 1991, RTD stated that:
The majority o f our riders are minority and have low
G:\mta\mcdiate\rg-bliss 2 2
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
income in relation to the rest of the population.
The $1.10 base fare is considered burdensome. Many of
our riders cannot take advantage of the discounted base fares
offered (either 90c tickets or monthly passes).
MTA, Gary Spivack, Presentation of Gary S. Spivack, SCRTD Labor Negotiations (July 1, 1991),
M328080 at M328086, contained in cummulative document titled July 1, 1991 - Material
Submitted to Panel /4s Part o f Lockyear, M328072.
78. MTA's Operations Department noted that MTA had "relatively high passenger
fares" in July 1993, a year before the MTA Board voted to restructure fares. MTA, A. Leahy,
Status Report on MTA Bus System (July 2, 1993), M514360 at 514378, and attached report titled
Status Report on MTA Bus System, Phase I - Status o f the Present Bus System, M514363.
79. The MTA forecast that the July 1994, fare restructuring would increase operations
revenue by $51.4 million, and would decrease bus ridership by 6.9 percent or by 1.14 million
daily boardings. The restructuring would increase the MTA's annual fare revenue per passenger
by 35 percent. MTA, Memo to Distribution from Thomas Rubin re: Impacts o f Proposed Fare
Structure, at 3 (June 17, 1994), 950004 at 950006. The net result would be to lower the subsidy
that MTA bus passengers receive below preexisting levels, further widening the disparity in
subsidy levels between MTA bus riders and the riders of Metrolink, of the Long Beach Blue
Line, of the Red Line, and of the non-MTA bus operators.
80. MTA found that the July 1994, fare restructuring would "have the unfortunate
impact of increasing fares the most for riders [who] use transit the most, have the lowest income,
and the least external subsidies." Those most severely affected would be 75-80,000 riders,
representing over a quarter of all MTA passengers, who use monthly passes. This group would
see an increase of 63 percent from $42 to an average of $68.50 if riding patterns did not change.
The next most impacted group would be cash riders, with an increase of approximately 20
percent. MTA, Memo to Distribution from Thomas Rubin re: Impacts o f Proposed Fare
Structure, at 1 (June 1994), 950004. Both categories are heavily minority and transit-dependent.
81. "[A] typical MTA rider family, with a household income under $15,000, with two
G:\mta\mediate\rg-bliss 23
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
members [who] buy and use monthly passes . . . could easily see their transit costs increase by
over $500 per year — or by over 4 percent of household take home pay." MTA, Memo to
Distribution from Thomas Rubin re: Impacts of Proposed Fare Structure, at 2 (June 17, 1994)
(brackets and ellipsis added), 950004 at 950005; Testimony o f Thomas Rubin and Brian Taylor.
82. The July 1994 fare restructuring would have a very severe impact on poor,
minority MTA riders, according to the bus riders themselves. See Decs, o f Jose Marroquin
(Sept. 7, 1994), 801280; Juan Zamora (Sept. 7, 1994), 801324; Blanca Vasquez (Sept. 6, 1994),
801231; Marcia Taylor (Sept. 7, 1994), 801308; and Jacquelyn Dixon (Sept. 8, 1994), 801234.
83. The fares MTA rail riders pay do not come close to operating costs, even though
the operating costs of a rail line are generally less than capital costs. In 1994, MTA's chief
financial officer Terry Matsumoto stated that rail fare revenues were $5.8 million while operating
costs were $70 million, or 12 times more. Minutes of MTA Special Board Meeting (June 22,
1994), M902048 at M902049-50.
C. MTA Bus Riders Are Adversely
Affected By Disparate Levels
Of Overcrowding On Buses
84. The Court has found that MTA's 1993 Inner City Transit Needs Assessment
Study concluded that MTA routinely permitted overcrowding levels on buses of 140 percent of
capacity. Findings o f Fact and Conclusions o f Law re: Preliminary Injunction, at 2 (Sept. 21,
1994).
85. Since 1984, the passenger capacity standard has allowed overcrowding at 145
percent of capacity for a 43-seat bus. This standard permits "schedul[ing] service to extremely
high loads." In 1990, an RTD report found that in FY 1989-90, "RTD service [was] scheduled
very close to the capacity standards" and that "overcrowding [did] occur on a significant number
of trips." RTD staff reported that over 50 bus lines operated above the loading standard during
the peak hour, approximately 1/3 of all trips had excessive loads during the A.M. rush hour, and
excessive loads occurred on over 22 percent of the trips operated. According to the report,
"[b]ecause RTD service is scheduled close to capacity, the service can be characterized as being
fragile in the sense that even minor inequalities in the interval between buses will cause
G:\mta\mcdiate\rg-bliss 24
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
excessive crowding and a significant decrease in the quality of service as perceived by our
riders." Thus, even if average loads on a service are within capacity standards, "most riders
using that service during the time period examined actually experience very crowded conditions."
RTD, A. Pegg, Executive Summary - Status Report on District Bus Service Delivery for FY 1990
(September 27, 1990), M514235 at M514236-37, and attached technical paper entitled "Status
Report on District Bus Service Delivery for 1990" (Sept. 1990), M514240.
86. The 1990 RTD report on bus service delivery recommended that a total of 160
buses be added to the system to reduce the overcrowding from 145 to 135 percent of seated
capacity, and to improve on-time performance to 85 percent. Id. M514235 at M514238.
87. According to RTD's General Manager in 1990, "while RTD is doing all it can to
move as many riders as it can at the lowest cost, Los Angeles is probably the most underserved
transit market in the County." RTD reported that in 1988, RTD had the greatest passenger "miles
per active vehicle for the 20 largest urban bus operators, twice the miles of the average of the
other 19. RTD buses also had the highest average passenger load of the group, almost 50
percent greater than the average of the other 19. RTD's operating cost per passenger mile,
however, was the lowest of the group, 29 cents per passenger mile compared to an average of 46
cents for the other 19 bus operators. RTD News, Federal Report shows RTD Bus System Is
Number One in Key Operational Areas (undated) (includes charts), 002070 at 002070-72,
002074-77.
88. In 1990, RTD's Board President stated that: "Whenever we add new buses to our
fleet, people fill them immediately. The public obviously needs them all, and more. But our
subsidies plunged after 1985, which was the year our ridership peaked at almost 500 million."
The level of RTD's unlinked passenger trips paralleled the subsidy level, with a peak of 497.2
million trips coinciding with a subsidy of $323.7 million (constant FY 1980 dollars) falling to a
FY 1990 level of 401.1 million trips and a subsidy of $251.7 million. RTD News, Federal
Report Shows RTD Bus System is Number One in Key Operational Areas (Sept. 25, 1990),
002070 at 002072, 002078.
89. A joint RTD-LACTC study reported that in 1991, RTD had 50 overcrowded bus
G:\mta\mediate\rg-bliss 25
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
lines in both the morning and evening peak periods. A majority of the overcrowded lines were
on local buses. Using RTD overcrowding standards, 120 additional trips alone were needed to
relieve morning peak period overcrowding. RTD, Alan Pegg, Bus Overcrowding Study (March
5, 1991), at attached Bus Overcrowding Study, Technical Report (March 4, 1991), 002015 at
002020, 002024.
90. In March 1991, RTD issued a report that "acknowledged that overcrowding is a
serious problem confronting Los Angeles County transit operators and that up to 125 additional
peak buses may be needed to meet present SCRTD loading standards," recommending that 15
buses be funded for a four month period to reduce overloads and that additional funds be sought.
Two months later, RTD staff provided the RTD Board with another report that found current
RTD loads are the highest in the nation, 61 percent of weekday RTD lines are overcrowded, 43
percent of RTD peak hour trips are overcrowded, and "[cjurrent RTD loading standards are
among the highest in the nation." The May 1990 report recommended reducing RTD load
standards to address overcrowding, and providing added capacity to promote greater use of
transit. A. Pegg, SCRTD Passenger Overcrowding Study - Findings and Recommendations to
Reduce Overcrowding (May 3, 1991), M514292, M514292-93, at M514295, and attached report
entitled "Passenger Overcrowding Study, Findings and Recommendations to Reduce
Overcrowding" (April 1991), M514296.
91. RTD's comments on a proposal to reduce the 145 percent load standard to 140
percent in the 1991 Congestion Management Program included the following statements: "The
proposed 140% load standard for frequent local service (headways of less than 11 minutes) is
much too high to attract discretionary passengers. The 140% local standard will engender
overcrowded buses and passenger pass-ups. It will not provide encouragement to use transit. A
better approach would avoid load standards that guarantee passenger discomfort, forcing people
onto other shared riding modes.” RTD, A. Pegg, Congestion Management Program for Los
Angeles County Final Draft (undated), 013192 at 013197.
92. RTD's top officials reported to the RTD Board in November 1992 that:
There is a huge unmet demand for basic transit services in
G:\mta\mediate\rg-bliss 26
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Los Angeles. Many of these needs can be met very simply and
easily by adding service to the many heavily utilized bus lines that
we now operate. Policy board members may wish to contrast this
strategy for expansion of transit against the heavily capital
intensive and high operating cost guideway modes of transit,
which generally have subsidies per passenger of thirty, fifty, or
one hundred times more than do expansions of bus lines.
If the objective is to improve the quality of transit service
in Los Angeles County, there are also two options. One is to
promote the expensive fixed guideway alternative. This will wind
up providing extremely expensive service to a very small number
of passengers (even at the end of the Commission's proposed 30-
Year Plan, well under 20% of all transit trips will be on rail
modes). Another alternative is to spend a small amount of
additional money on each existing bus passenger. If all we did
was to reduce overcrowding, we will have accomplished a great
improvement in quality by allowing more of our riders to find a
place to sit during their daily travels. But we can do much more,
and at very little expense, in providing more frequent, more
reliable service, cleaner buses, better security, more off peak,
evening, and weekend service, and other improvements. And, if
we can accomplish this increase in service quality, not only will
[we] be giving our existing passengers the type of service that they
deserve, we will also attract many new riders to bus lines.
RTD, Alan Pegg, Heavy Usage Bus Lines (Nov. 2, 1992), 001871 at 001872-73.
93. In 1993, RTD staff reported to the Board that:
Overcrowding on RTD/MTA buses continues to be a significant
problem. Sixty-three of the system's 126 bus lines are
G: \mta\mediate\rg-bliss 27
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
overcrowded during peak hours. The average bus load is higher
on the RTD/MTA system than any of the 20 largest bus systems
in the nation. Even though ridership has declined slightly during
the past two years, the reduction in service levels has resulted in a
continuation of overcrowded buses. Overcrowded buses result in a
general decline in service quality.
RTD, A. Pegg, FY93 Status o f District Bus Service, Draft (March 17, 1993), M514335 at
M514335-36, and attached report entitled "FY93 Status o f District Bus Service" (March 17,
1993), M514334.
94. MTA's Operations Planning Department explained in 1993 that the Board's
approval of $4.5 million to fund an additional 40 peak buses during FY 1993-94 was designed
partially to bring crowding within MTA's 145 percent capacity loading standard. The
Department noted that an additional $6.0 million and 50 additional peak buses would be needed
to bring remaining MTA routes into compliance with the 145 percent standard.
The MTA Board recently took action to address
overcrowding by allocating $4.5 million to fund an additional 40
peak buses during FY 1994. This action will provide an effective
response to adverse conditions on the 25 most crowded MTA bus
routes. These lines are presently serving over 175 million annual
boardings and are operating in excess of 145% of a fully seated
load during the peak hours. There are 35 other MTA bus routes,
which have lower loading standards because of their less frequent
service, that are operating with actual passenger loads in excess of
their standards but less than the 145% level. In order to bring
these remaining MTA routes into compliance with current load
standards, 50 additional peak buses are needed at an annual
estimated cost of $6.0 million.
MTA, A. Leahy, Status Report on MTA Bus System (July 2, 1993) M514360 at 514377, and
G:\mta\mediatc\rg-bliss 28
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
attached report entitled "Status Report on MTA Bus System, Phase I - Status o f the Present Bus
System" (July 1993), M514364.
95. In March 1994, the MTA eliminated 40 percent of the additional buses. In June
1994, the MTA eliminated the remaining additional buses. MTA, Status Report on the MTA 40-
Peak Bus Service-Expansion Program (June 14, 1994), M331402 at M331403-04.
96. MTA's 145 percent loading standard anticipates 19 standees on a 43 seat bus.
Reducing the number of standees to nine requires ten percent more buses (176 buses) at a cost of
$18 million annually. Reducing the number of standees to zero requires 18 percent more buses
(190 buses) at a cost of $32 million annually. MTA, Metro Bus System Workshop (Sept. 14,
1995), M803 782 at M803809.
97. Studies conducted by the MTA staff in recent years have shown that “passenger
overcrowding during peak-demand periods is a persistent problem on many MTA bus lines.-
Even with the decline in system-wide ridership, a detailed analysis conducted last year revealed
that over 60 MTA bus lines had average maximum loads in excess of the established boarding
standards." MTA, Status Report on the MTA 40-Peak Bus Service-Expansion Program (June 14,
1994), M331402 at M331403. These 60 lines are 48 percent of the MTA's 127 bus lines.
98. Since July 1994, the MTA Board has taken no action to reduce overcrowding.
The level of overcrowding is essentially unchanged since 1994. Dep. o f Dana Woodbury at 437-
39 (Aug. 18, 1995) (Vol. 4).
99. MTA agreed to lend 60 new Compressed Natural Gas (CNG) buses to Atlanta for
use during the 1996 Olympics. This means that MTA will continue to use existing diesel buses
that would normally have been replaced with the arrival of the CNG buses for approximately six
to eight months. Minutes o f MTA Board Meeting (Sept. 27, 1995), M902412 at M902430; MTA
A. Leahy, Provision o f MTA Coaches to the 1996 Olympics in Atlanta (Aug. 29, 1995), M803435
at M803435-36.
100. MTA buses are crowded, dirty and dangerous. Inner city bus riders frequently
stand at benchless, unsheltered depots. Testimony of Martin Wachs and Martine Hernandez.
101. In contrast, MTA and Metrolink trains, and non-MTA municipal operator buses
G:\mta\mediate\rg-bliss 29
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
are uncrowded, comfortable, clean, and safe. See infra. Metrolink passengers report high
satisfaction with Metrolink MTA service. Id.
D. MTA Bus Riders Are Adversely Affected By The
Provision Of Disparate Levels Of Police Security
102. In fiscal year 1993, MTA spent the following annualized amounts on personal
security per passenger, by transit mode:
Mode Personal Security Cost/Passenger
Commuter rail $ 1.29
Blue Line 1.29
Red Line 0.57
Bus 0.03
MTA bus passengers, 94 percent of all MTA riders, were allocated $13.5 million in security.
Blue Line riders, 0.8 percent of MTA riders, received $15.2 million in security; Red line riders,
2.4 percent of MTA riders, received $3.4 million; and Metrolink commuter rail riders, 0.4
percent of riders, received $1.6 million in security. MTA, A Look At The MTA (Jan. 1994),
800042A at 800094A-95A.
103. The $1.29 cost of personal security provided on the Long Beach Blue Line or on
Metrolink, per passenger, was 43 times more than the cost of security provided each bus rider,
and two-and-a-half times the Blue Line fare revenue. In fact, the cost of security on the Blue
Line was ten times the average per-passenger security costs of the next eight self-service fare
collection rail systems in North America, although the level of crime on all nine rail lines was
similar. MTA, A Look At The MTA (Jan. 1994), 800042A at 800094A.
104. In 1993, 58 percent of the 453 officers assigned to rail or bus operations were
assigned to rail operations (263 officers) while only 42 percent were assigned to bus operations
(190). Of the 263 officers assigned to rail, 114 were being assigned to the Long Beach Blue
Line, 75 to the Green Line, 45 to the Red Line, and 29 to Metrolink. MTA, Security Cost
Comparison (May 25, 1993), D112070-71.
105. In July 1995, the United Transportation Union wrote to the MTA Board
G:\mta\mediate\rg-bliss 30
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
protesting that in the 1995-96 budget, 63 percent (191 of 300) of the sworn officers available for
assignment to rail or bus operations were being assigned to the Long Beach Blue Line (100),
Red Line (35), or Green Line (56), leaving only 37 percent (109) for assignment to MTA bus
security. (Seventy-one officers were assigned to administrative, plain clothes and various task
force duties.) The Union protested the "callous . . . disregard" and "utter disregard" for "the
security of the more than one million persons who ride the buses each day." Earl Clark,
General Chairman, United Transportation Union, General Committee o f Adjustment, to Larry
Zarian, MTA Board Chair (July 7, 1995). The MTA did not heed the protest.
106. Overall, as summarized by MTA’s former Chief Financial Officer and current
Controller, the amount of money which MTA spends for security “on rail is greater than it is on
bus. . . . It is significantly more on rail than it is on bus.” Dep. Of Terry Matsumoto at 222
(Sept. 19, 1995) (Vol. 2).
107. RTD reported in 1991 that the cost per passenger for security on the Long Beach
Blue Line was almost ten times the average of the light rail transit operators and that light rail
systems nationally generally do not have security problems to warrant such costs. RTD proposed
using less expensive RTD Transit Police to provide security on the Long Beach Blue Line and
using the savings for bus security. According to RTD, the savings of $5.6 million would provide
for 55-60 additional transit police officers for bus security, the purchase of 22 buses, or the
operation of 38 buses for one year to produce over 6.5 million additional transit passengers.
RTD, Alan Pegg, Blue Line Security (Oct. 22, 1991), 002168 at 002176-77, 002178, 002182-83.
108. The vast amount of money spent on Blue Line security contributes to the high
operating costs as well as to the disproportionate subsidy per passenger:
The Blue Line has by far the highest operating costs of any light
rail line in the nation, in large part because of the extremely high
security costs (ten times the average security cost per passenger of
the other eight self-service fare collection urban rail systems in
North America). As a result, the Blue line subsidy per passenger
is off the scale.
G:\mta\mcdiate\rg-bliss 31
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Memo from Tom Rubin to Richard Stanger re: Metrolink Costs, at 7 (April 24, 1993), 011067 at
011073.
109. According to the RTD in 1991:
Given that there is a limited amount of money to be spent
on transit overall, and only a limited portion of these funds can be
allocated to security, should not we do all we can to spend these
funds as cost-effectively as possible? How long can we continue
to spend 49 times as much for the security of a rail passenger as
for a bus passenger, when they travel through the exact same area
-in fact, over two-thirds of the Blue Line riders use buses to go
and/or from the Blue Line.
It is also difficult to explain to bus passengers why more
money is being spent to protect 30,000 passengers a day on the
Blue Line as is being spent to protect 1,300,000 passengers a day
on the bus system.
RTD, Alan Pegg, Blue Line Security (Oct. 22, 1991), 002168 at 002185.
110. In 1991, RTD compiled a book of documents containing information about
security on RTD buses and the Blue Line in connection with a request by RTD to the LACTC to
have security on the Long Beach Blue Line provided by the regular RTD Transit Police as
opposed to a contract with the Sheriffs Department. RTD, LASO vs. SCRTD Police/Blue Line
Book (1991), D112235-642.
111. According to the RTD, security strategies differ on the Long Beach Blue Line and
buses. The primary strategy employed on the Blue Line was to maintain a presence that deters
potential crime. The transit police on buses did not try to maintain such a presence; they
employed the primary strategy of only responding to reported crime. SCRTD Security Cost
Analysis Bus Versus Light Rail (undated), at D112422.
112. LACTC resolved the controversy in 1991 by extending the sheriffs contract for
two years from July 1992 to June, 1994, but increasing the size of the transit police. Id. at
G:\mta\mcdiate\rg-bliss 32
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
D112399, D112335-36, D112521-26.
113. At a RTD Security Task Force Advisory Committee meeting on November 23,
1992, the issue was raised that "[t]here is currently a wide-spread lack of confidence among bus
operators as to the ability of SCRTD police to protect them or their riders." The concern was
expressed that:
Transit Police are spread too thinly to adequately police the
SCRTD's 2200 square mile territory. Police response times are
generally too slow, SCRTD Police are often viewed by operators
as unprofessional and outside police agencies as insensitive.
RTD, Joseph Theodore and Associates, Meeting of the Security Task Force Advisory Committee
(Nov. 25, 1992), D121078 at D121079.
114. In 1993, a consultant reported to LACTC that: "[Pjolice visibility is minimal.on
buses due to the large service area that the buses travel and the minimum commitment of local
law enforcement to bus crime. Few agencies, other than MTA Police and contract sheriffs, ever
board conveyances for crime prevention purposes." "The report of law enforcement on buses is
required to abate the perception of County residents that buses are not safe and are a haven for
criminals and criminal activities." In contrast, MTA-funded security personnel maintained "high
visibility" on the Blue Line and on Metrolink. LACTC, Joseph Theodore & Associates, Transit
Security and Policing in Los Angeles County (Feb. 1993) (original emphasis), D112122 at
D112133-34, D112136, D112139.
115. LACTC's security consultant made ten recommendations. Recommendation
number one was to "[i]ncrease the number of police personnel assigned to bus transit police
duties in Los Angeles County." Joseph Theodore and Associates, Executive Summary o f
Findings and Recommendation o f the Transit Security Study Conducted by JTA, Inc. (Jan. 19,
1993), D121088 at 121095.
116. An MTA analysis of its fiscal year 1993-94 security budget showed that MTA
was spending $0.05 for security per boarding on buses, $1.27 per boarding on the Blue Line, and
$1.09 on the Red Line. The analysis also showed that the cost of transit police as a percentage
G:\mta\mediate\rg-bliss 33
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
of operating cost was three percent on buses, 28 percent on the Blue Line and 18 percent on the
Red Line. MTA, Budget Office, Fiscal Year 1993-94 Security Budget (Dec. 2, 1993), M1040005.
117. During fiscal year 1992-93, MTA stated that 199 Transit Police were deployed for
bus security, 34 Transit Police were deployed for Red Line security, and 199 Sheriffs Deputies
were deployed for Blue Line security. There were also five police dispatchers. MTA, Budget
Office, Fiscal Year 1993-94 Security Budget (Dec. 2, 1993), M1040005 at M1040005-06. Thus,
more than 50 percent of sworn security personnel were deployed on rail operations. At the time,
only four percent of MTA boardings were on rail. See id. at M1040005.
118. In 1991, a consultant from the LACTC's Rail Construction Corporation projected
that by the end of the decade, "bus and rail transit-related security costs will approach $90
million annually, and that nearly two-thirds of this total will be spent for rail transit systems
construction and operations security." Approximately $55 million of security costs was projected
for rail transit operations fiscal year 1999-2000, $30 million for bus operations, and $2 million
for rail construction. The consultant found that, following LACTC's existing policies, "[b]y the
end of the decade, roughly 500 sworn and civilian personnel will be required for rail transit
police service, including 350 sworn police officers." The consultant quoted the LACTC's
executive director's statement that "'w e hope to overinvest in security'" as "summariz[ing] the
Commission's view of the need for providing adequate rail system security." LACTC, Aegir
Systems, Inc., Coordination o f Security Efforts for Public Transit Patrons, Vehicles, Properties,
and Equipment in Los Angeles County (Dec. 6, 1991), M1030209, M1030211, M1030215,
M1030234 and M1030241.
119. In 1992, LACTC's Rail Construction Corporation recommended that the original
$900,000 allocated for the Sheriffs Department to provide security coordination on Metrolink be
augmented by $854,000 to enhance security. According to the LACTC: "This additional staffing
will provide a visible uniform presence at stations and on trains with a much improved ability to
respond to calls for service, assistance and emergencies. This level of staffing will also allow for
enforcement of the quality of life violations which is so necessary for a clean and ordered system
and will result in the deterrence of crime. LACTC, Enhanced Security for Metrolink in Los
G:\mta\mcdiatc\rg-hliss 34
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Angeles County (Oct. 6, 1992), M0040280-81.
120. An MTA survey of transit security of the 20 largest transit operators, ordered by
the MTA Board of Directors in 1994, found that seven transit operators had contractual
arrangements with local police departments for services or the hiring of off-duty police officers,
including MTA's contract with the Los Angeles County Sheriffs for security on the Blue Line.
MTA's cost per patrol unit was slightly over three times the average cost per patrol unit of the
other contracts and 73 percent higher than the second highest price paid. MTA, Tom Rubin,
Transit Security Survey (March 10, 1994), M1040007, M1040008 at M10400012-13.
121. The MTA's Transit Police Department stated that in fiscal year 1995-96, the
Department would deploy 100 sworn officers on the Blue Line and 35 officers on the Red Line.
The Department also stated that it would deploy 109 sworn officers on the bus system for
uniformed patrol service along with special supporting task force operations. MTA, MTA Transit
Police Department (undated), D121114 at D121123-24.
122. For fiscal year 1995-96, the MTA Board took one million dollars which
previously had been set aside for MTA bus security and allocated the funds to several municipal
bus operators for their security projects. The Board did so over MTA staff objections that the
1995-96 MTA security budget would be reduced and MTA budget deficit increased. Call for
Projects Ad Hoc Committee, Committee Recommendation (Feb. 2, 1995), M323554; Memo from
Judith Wilson to call for Projects Committee, Transportation Improvement Program Call for
Projects Staff Recommendations, at 74-75 (May 16, 1995), M322807 at M322880-82.
E. Minority MTA Bus Riders Are Adversely
Affected By The Provision Of Disparate Subsidies
And Service Compared To White MTA Bus Riders
123. In 1992, RTD’s Planning Department found that the distribution of ethnicities was
different on local and express RTD bus lines serving downtown for fiscal years 1990, 1991, and
1992. Minority riders accounted for 87 percent of local line ridership, and whites were 13
percent. On the other hand, minority riders were only 64 percent of downtown express line
riders, and white riders were 38 percent of express line riders. While almost two-thirds (63
percent) of downtown RTD local bus line riders had household incomes of less than $15,000,
G:\mta\mcdiate\rg-bliss 35
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
only 29 percent of express line riders had such low income levels. Overall, the RTD Planning
Department found that almost three quarters of all downtown riders who reported annual
household incomes of less than $30,000 were patrons of local bus lines. The median household
income for all downtown RTD local line riders was below $15,000, while the median income for
express line riders was between $15,000 and $30,000. RTD Scheduling and Operations Planning
Department, M. Schildkraut, FY90-92 Origin & Destination (O/D) Passenger Surveys:
Demographic Characteristics o f Downtown RTD Bus Riders (Feb. 11, 1992), D103505 at
103506-10.
124. Plaintiffs' experts, Professors Brian Taylor and Martin Wachs from the UCLA
Institute of Transportation Studies, analyzed the same MTA data for the entire bus system as the
1992 Planning Department study. They analyzed the line-by-line racial/ethnic ridership on the
MTA's bus lines from 1991-93 in order to ascertain if minority or white MTA bus riders -
received different levels of subsidies. They also analyzed the fares and subsidies of the 25 most-
minority bus lines, which had a weighted average of 92 percent minority riders and 6 percent
white riders, and the fares and subsidies of the 25 least-minority bus lines, which had a weighted
average of 59 percent minority riders and 39 percent white ridership.
125. These analyses show that the total subsidy per boarding for minority MTA bus
riders was 17 percent lower than for white MTA bus riders.
Race Total Subsidy per MTA Passenger
White $1.91
Minority 1.63
Even more dramatic, the total subsidy per boarding for riders of the 25 least-minority MTA bus
lines was $1.61 while the subsidy for riders of the 25 most-minority MTA bus lines was $1.13.
The boarding subsidy for the most-minority MTA bus lines was 43 percent lower. Brian Taylor,
Martin Wachs, et al., Variations in Fare Payment and Public Subsidy by Race and Ethnicity: An
Examination of the LAMTA, at 19-20 (Nov. 5, 1995), E l00567 at E100586-87.
126. MTA survey data tend to understate actual differences between subsidy levels
received by minority and white MTA passengers. The survey instructions were offered only in
G:\mta\rnediate\rg-bliss 36
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
English and Spanish, undocumented residents are unlikely to have participated in numbers
proportional to actual ridership, and the MTA surveys likely undercount passengers making
shorter trips who are disproportionately minority. Id. at 8-10, E100567 at E100575-77.
127. Professors Taylor and Wachs conclude that:
[MJinority riders (1) pay higher average fares than white riders
and (2) receive lower average subsidies than white riders. These
differences are largely due to the fact that (1) white riders travel
longer distances, on average, than minority riders and (2) white
riders use expensive express and rail services in higher proportions
than minorities. These systematic racial/ethnic differences in
ridership combined with a fare structure that (except for express
buses) does not vary by distance or mode to differentially favor
white MTA riders, as a group, over minority MTA riders, as a
group. Further, while available data do not allow for an analysis
of racial/ethnic variations in fare and subsidies by peak and off-
peak service by peak direction and backhauls, preliminary
evidence suggests that such an analysis would only compound the
racial/ethnic differences reported here.
Thus, while non-whites use public transit in far greater
proportions than whites, this analysis has shown that whites pay
lower average fares and receive higher average subsidies than
minority transit users. These variations in fare payment and public
subsidy by race and ethnicity derive, in part, from a series of
MTA policy decisions to (1) expand relatively expensive rail and
commuter services serving a disproportionately white clientele and
(2) adopt a generally flat fare structure that causes riders making
relatively short trips on local buses (who are disproportionately
minority) to cross-subsidize riders making longer trips on express
G:\mta\mediate\rg-bliss 37
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
and rail lines (who are disproportionately white). As a result of
these policy choices, minority riders, on average, pay substantially
more for MTA services and receive lower average taxpayer
subsidies than white riders.
Id. at 22-24, E100567 at E100589-91.
128. The July 1994 fare restructuring increased the fare and subsidy disparities
between minority MTA bus riders and their white counterparts.
IV. MTA HAS HISTORICALLY PROVIDED ITS MINORITY
BIJS RIDERS INADEQUATE AND COSTLY SERVICE
A. The McCone Commission In 1965 Found That Bus
Service In South Central Los Angeles Was
Inadequate And Prohibitively Expensive__________
129. The report of the Governor's Commission on the Los Angeles riots, Violence in
the City - An End or a Beginning (Dec. 2, 1965), 950484, chaired by John A. McCone,
comprehensively reviewed the role played by MTA's predecessors in operating Los Angeles
County's inadequate transportation system that "handicaplped minority residents] in seeking and
holding jobs, attending schools, shopping, and in fulfilling other needs," contributing to the
isolation that led to the 1964 Watts riots. McCone Commission Report (Dec. 2, 1965), 950484 at
950559.
130. The Commission expressly found that the bus system was both "inadequate” and
prohibitively expensive."
Our investigation has brought into clear focus the fact that
the inadequate and costly public transportation currently existing
throughout the Los Angeles area seriously restricts the residents of
the disadvantaged areas such as south central Los Angeles. This
lack of adequate transportation handicaps them in seeking and
holding jobs, attending schools, shopping, and fulfilling other
needs. It has had a major influence in creating a sense of
isolation, with its resultant frustrations, among the residents of
G:\mta\rmxliate\rg-bliss 38
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
south central Los Angeles, particularly the Watts area. Moreover,
the lack of adequate east-west or north-south service through Los
Angeles hampers not only the residents of the area under
consideration here but also of all the city.
Historically, the Los Angeles area was served by private
transportation systems, many of which were sold to the
Metropolitan Transit Authority, a public entity, in 1958. The
Southern California Rapid Transit District (RTD), which was
created by the legislature, succeeded the Metropolitan Transit
Authority in November 1964. The RTD, although a public
agency, is neither tax supported nor subsidized. . . . Traditionally,
bus systems in the Los Angeles area have met increasing costs in
operations by increasing fares and cutting back service. The
consequence of these actions has been a transportation system
which is prohibitively expensive and inadequate in service.
McCone Commission Report (Dec. 2, 1965), 950484 at 950559-60; MTA Admission No. 4
(admitted that “the indented paragraphs cited” appear in the McCone Commission Report, and
that “the document speaks for itself’).
131. The Commission concluded that "economical public bus transportation is essential
to our community," and is “particularly essential to the poor and disadvantaged who are unable
to own and operate private automobiles. (Only 14 percent of the families in Watts are car
owners as against 50 percent elsewhere within Los Angeles County).” McCone Commission
Report (Dec. 2, 1965), 950484 at 950560-61; MTA Admission No. 5 (admitted that “the
language quoted” is contained in the McCone Commission Report, and that “the document
speaks for itself’).
132. The McCone Commission reported that "the Mexican-American community,
which here is almost equal in size to the Negro community, suffers from similar and in some
cases more severe handicaps than the Negro community." McCone Commission Report (Dec. 2,
G:\mta\mediate\rg-bliss 39
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
1965), 950484 at 950486-87; MTA Admission No. 6 (same as above).
133. A California State Study reported in 1969 that most of East Los Angeles was
served by Eastern Cities Transit, and that "the same lack of direct access and the double-fare
barrier . . . for the Watts area prevail in the East Los Angeles neighborhood." Most of RTD's
routes in East Los Angeles were suburban routes ("most of these routes are on expressways and
provide no local service").
134. The California State Study also reported that "a substantial part of the
metropolitan area is beyond 90 minutes by transit from East Los Angeles" and that "virtually the
entire southern half of the Los Angeles metropolitan area is beyond transit reach from East Los
Angeles, except by inadequate three- or four-vehicle service." State o f California,
Transportation-Employment Project Evaluation of Present Bus Operations and Summarv of
Transit Needs (1969), M604050 at M604091-92; MTA Admission No. 15 (admitted that the-
document “contains the language quoted” and that “the document speaks for itself’).
135. The California State Study reported that in South Central: "No transfers are
honored between Blue and White Bus and SCRTD, making it necessary for passengers in the
Blue & White Bus territory to pay two full fares to reach downtown Los Angeles. This situation
is a matter of accute irritation in Watts and neighboring communities which rely primarily upon
Blue and White Bus service." The study also reported that: "Even 90 minute travel time by bus
is insufficient to enable Watts residents to reach Santa Monica, Hollywood, Glendale, Pasadena,
Whittier, Torrance and other communities that are 7 to 18 miles distant." State o f California,
Transportation-Employment Project Evaluation of Present bus Operations and Summary of
Transit Needs (1969), M604050 at M604090-91; MTA Admissions No. 12 & 13 (same as above).
136. The 1969 California State Study of South Central and East Los Angeles transit
needs concluded:
Community needs for new transit service or service
improvement remain substantial in most of these areas: for work,
for shopping, for senior citizens, for students. But the home-to-
work travel need is paramount: the transit traveller, in an hour,
G:\mta\mediate\rg-bliss 40
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
has access to only a third of the job opportunities accessible to the
motorist, and in a half hour (from South Central Los Angeles) less
than a tenth of those accessible by auto.
Id. M604050 at M604136; MTA Admission No. 16 (admitted that the document “contains the
indented passages cited” and that “the document speaks for itself’).
B. MTA Failed To Remedy The “Prohibitively Expensive”
Fares Criticized by the McCone Commission_____________
137. The MTA and its predecessor RTD substantially failed to reduce bus fares. The
bus fare the McCone Commission deemed "too costly" and "prohibitively expensive" in 1965
was a 25 cent fare in effect from 1961 to 1970. The 25 cent fare in 1965 approximately equals
$1.14 in constant 1994 dollars. Since 1980, the bus fare in current dollars has been lower than
$1.10 in constant 1994 dollars only in 1982-85, when the MTA was required to lower the fare,
and tens of millions of additional riders boarded MTA buses. MTA, LA Transit Fares (undated),
M1012009.
138. The bus fare increase in 1994 from $1.10 to $1.35 pushed the fare above the
1965 level criticized by the McCone Commission as "prohibitively expensive."
C. MTA Failed To Comply With The McCone Commission's
Recommendations To Begin To Provide Adequate Bus Service
139. The McCone Commission criticized the fact that the South Central area was
served by four separate bus entities.
In general, the coverage and frequency of bus service in the Watts
area is comparable to service throughout the Los Angeles area. In
the judgment of the Commission, however, it is both inadequate
and too costly. As related to the Watts area, the problem stems
from the following facts.
(1) Four separate bus entities and one subsidiary operate
within the Watts area (Southern California Rapid Transit District,
Atkinson Transportation Company and its associated company,
South Los Angeles Transportation Company, Torrance Municipal,
G:\mta\ynediate\rg-bliss 41
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
and Gardena Municipal). . . . A resident of Watts may have to
ride on several separate bus systems to reach certain destinations
in the immediate area. These transportation systems are
uncoordinated, do not provide for free transfers between systems
(except in the instance of parent and subsidiary), and have been
forced to cut back service and increase fares over the years
because of increased capital and operating expenses.
(2) RTD is authorized by law to provide long-line services
connecting contiguous urban areas, and thus it provides the
principal transportation in and out of the Watts area. This system
does not have free transfer privileges between most separate urban
areas, nor to local services within most contiguous urban areas,
many of which maintain their own bus services. This means that
transportation from one section of the metropolitan area such as
Watts to almost any other area requires an additional fare or fares
and transfers.
McCone Commission Report (Dec. 2, 1965), 950484 at 950560; MTA Admission No. 10
(admitted that “the indented passages” “are contained in the document,” and that “the document
speaks for itself’).
140. The Commission recommended that the RTD acquire the small companies "which
now complicate and increase the cost of transportation in the Los Angeles area," establish
transfer privileges "in order to minimize transportation costs," and establish "an adequate east-
west crosstown service as well as increasing the north-south service to permit efficient
transportation to and from the area." McCone Commission Report (Dec. 2, 1965), 950484 at
950561-62; MTA Admission No. 11 (admitted that “the language quoted” “is contained in the
document” cited, and that “the document speaks for itself’).
141. Notwithstanding these recommendations about bus operations, the RTD was
recalcitrant in changing the bus system. Testimony of Lucius Collier.
G:\rn ta\mcdiatc\rg-bliss 42
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
142. A letter dated March 2, 1966, sent to the County Board of Supervisors from
Welfare Planning Committee, South Central Area, urged the implementation of the McCone
Commission recommendations. The results of a survey conducted by the Welfare Planning
Committee showed that transportation was woefully inadequate in the Watts area, and the lack of
transportation had a direct impact on social services. The survey found that it took two hours
and a ride on two buses to travel the 13 miles between 114th street and Wilmington Avenue to
County General Hospital. Letter from Roy Thompson to Los Angeles County Board of
Supervisors (March 2, 1966), H000294. On May 26, 1966, Elizabeth Ransom of Inglewood sent
the Board a letter complaining of the two hour travel time on three different buses to take a trip
from Inglewood to Santa Monica. Letter from Elizabeth Ransom to Kenneth Hahn (May 25,
1966), H000314.
143. The RTD nevertheless refused to implement a more efficient bus system in South
Los Angeles, relying on a provision in the Los Angeles Metropolitan Transportation Authority
Act of 1957 which allegedly restricted the creation of a bus line that "overlapped or interfered"
with an existing public or private bus line. Letter from Cone Bass to Kenneth Hahn (March 15,
1966), H000286. See also letter from Kenneth Hahn to Cone Bass (March 10, 1966), H000315.
This statutory "obstacle" was overcome, however, when the RTD annexed lines in suburban areas
such as the Pasadena City Lines, Pomona Municipal Lines, San Pedro Lines, Inglewood City
Lines, and Eastern City Lines, which also overlapped or interfered with existing public or private
lines. The RTD's reliance on the statutory restriction was merely a pretext for the RTD's
decision not to implement the McCone Commission recommendations. Testimony of Lucius
Collier; Report on the Acquisition of the Pasadena City Lines and Inglewwod City Lines (Nov.
25, 1968), H000372-388. See also memo from John Curtis to Cone Bass (April 12, 1966),
H000280.
144. The 1957 Act was also used by RTD as justification for its refusal to establish a
viable grid pattern in South Los Angeles of the east-west and north-south transportation services
recommended by the McCone Commission because the Act purportedly prohibited a
transportation agency from acquiring any private bus company whose operating costs were
G:\mta\mediatc\rg-bliss 43
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
greater than profits. The Los Angeles Metropolitan Transit Authority Act o f 1957, Assembly Bill
No. 1104, CA Statute Chap. 547, 1957; letter from Ralph P. Merritt to Kenneth Hahn (Jan. 21,
1959) (purchase o f private bus companies between Inglewood and Lynwood would divert profits
from other private bus companies), H001892; letter from Kenneth Hahn to Cone T. Bass (March
10, 1966) (regarding implementation of McCone recommendation to improve transportation with
the purchase o f South Los Angeles Bus Company in Willowbrook area), H000315. See also RTD
Memo to Cone T. Bass (April 12, 1966), H000280;
145. The RTD agreed to provide ad hoc bus service to South Los Angeles only when
the federal government funded 100 percent of the operation costs. Memo from John Curtis to
Cone Bass (April 12, 1966), H000280. One such line extended bus service on Century
Boulevard from central Watts to the airport. See generally Letter from Cone T. Bass to Kenneth
Hahn (Aug. 14, 1966) ("[T]he decision to institute a service on Century Boulevard was nor ours,
since we knew that it will not even come close to paying the cost o f operation. The State
Transportation Agency made the decision as to the institution o f service on Century Boulevard
. . . ."), H000141; Kenneth Hahn, memo regarding telephone conversation with Cone T. Bass
(Aug. 3, 1966) (Bass claims RTD cannot make changes on Century Line), H000139; Kenneth
Hahn Press Release, Hahn's Ride from Central Watts to LAX Took 42 Minutes (Aug. 3, 1966),
H000138; Kenneth Hahn Press Release, Speed Up Century Boulevard Bus Line (Sept. 16, 1966),
H000143; Robert Bradford Letter to Housing and Urban Development Department re: CA
Proposal for a Federal Research Grant to Study the Relationship Between Transportation and
Job Opportunities (April 1, 1966), H000276.
146. The RTD refused to make the federally-funded lines part of a long term
comprehensive plan to provide adequate east-west and north-south service in South Central. Cf.
SCRTD Press Release, Proposed Bus Line Connecting South Central to Beverly Hills, West L.A.
and Pacific Palisades (July 6, 1966), H000309. The RTD provided non-stop service in non
minority areas which did not pay for its operating costs. The RTD express bus service from
Rolling Hills through Redondo Beach to Los Angeles, called the Marineland Flyer, travelled
virtually empty and failed to pay its operating costs. Letter from Jack Gilstrap to Kenneth Hahn
G:\mta\mediatc\rg-bliss 44
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
re Marineland Flyer (Aug. 31, 1973) (Gilstrap justifies Marineland express service by comparing
revenue deficit to revenue deficits o f two bus lines in South Central), H000047; letters from
Kenneth Hahn to Gilstrap re Request for Information of Empty Marineland Flyers (July 9, 1973
& Aug. 17, 1973), H0000558 and H000046. The RTD refused to provide adequate bus service
to the predominantly minority area south of Manchester Boulevard despite pleas for such service
from the community and community leaders. Testimony of Lucius Collier. See also Dale
Barrett (RTD General Manager), Response to 100 Signature Petition re Poor Bus Service in
South Central (June 28, 1968), H000406; H000408-11.
147. The RTD also relied on the 1957 Act, which allegedly prohibited the
establishment of a service conflicting with an existing line, initially to avoid purchasing the local
Blue and White Line. RTD Recommendations regarding Blue and White Bus Company (Aug. 9,
1971), H000440; Kenneth Hahn Press Release, RTD Cannot Purchase Blue & White Line -
Because o f Statutory Prohibition (Aug. 5, 1971), H000438. The RTD eventually relented and
purchased the Blue and White Line in 1971 in the face of intense political pressure, and only
after the Line teetered on the brink of bankruptcy and operated haphazard service without
insurance. Testimony o f Lucius Collier; L. A. Times (Sept. 2, 1970), H000425; Telefax by
Gilstrap, RTD General Manager (Nov. 10, 1970), H000420 and (June 30, 1971), H000443;
Community In-Action Organization, 2000 Signature Petition to Extend Service on Normandie
(Aug. 7, 1972), H000453; Kenneth Hahn Press Release, Blue & White deterioration (Aug. 9,
1971), H000439.
148. The annexation of the Blue and White Line did little to improve the public
transportation service for the people of South Los Angeles. Even as more RTD buses rolled out
into the streets and were part of the larger network accepting transfers and purportedly providing
a more cohesive web of transportation, the RTD refused to link predominantly minority
neighborhoods with predominantly non-minority neighborhoods. Testimony o f Lucius Collier;
Letter from Kenneth Hahn to Gilstrap re: Lack o f Service along Prairie Avenue from Florence to
Manchester to the Daniel Freeman Hospital (Aug. 8, 1974), H000869; Letter from Jack Stubbs
to Hahn's Deputy re: Infrequent Service to El Segundo on Vermont (Aug. 1, 1973), H000580.
G:\mta\mediate\rg-bliss 45
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
149. In 1995, the City of Los Angeles Department of City Planning conducted a study
of transportation needs in South Central Los Angeles. The study reported that South Central
"residents are more limited in searching for jobs" and "at a competitive disadvantage relative to
more affluent areas due to lower incidence of car ownership." The study also noted that "[a]s
shoppers, they have to forego the opportunities open to car owners." Social indicators showed a
higher dependency by South Central Los Angeles residents on public transit than suburban
residents in other parts of the City and that even single car households have transportation
problems while public transportation service is minimal.
It appears that access to shopping ranks second to access to
employment in the priority of unfilled transportation needs.
Shopping for the South Central area residents who do not own
cars is difficult because of the lack of adequate shopping facilities
in many parts of the District. Although there are shopping
facilities within and outside the District that can be reached by
bus, trips to these centers frequently require transfers with lengthy
travel times. Even where bus services are available, shopping for
groceries by bus is unsatisfactory and impractical because of the
physical problems involved in carrying bags and parcels.
City o f Los Angeles, Department o f City Planning, Background Report, South Central Los
Angeles District, City Plan Case 23679 (Aug. 1975), M604672 at M604675, M604678-79.
150. The City of Compton reported that from the mid-1960s to 1975, Compton was
served by RTD, South Los Angeles Transportation Company and the Gardena Municipal Bus
Lines. Two major criticisms of the service were that most service ran in the corridor between
Compton and downtown Los Angeles with very little east-west routing and that every transfer
between the different bus service required an additional full-fare payment so travel to points
excluding downtown Los Angeles was costly. City o f Compton, Transit Development Plan (June
1978), M605060 at M605078.
151. The City of Compton reported in 1975 that its transit dependent residents were
G:\mta\mcdiate\rg-bliss 46
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
not using RTD service to its fullest potential in 1975 "since there is a mismatch between trip
destinations offered by the SCRTD and those desired by residents," half of whose destinations
were within the city where RTD service was inadequate. Id. M605060 at M605105, M605108-
09.
152. In the 1980s, predominantly white and affluent communities were successful in
requesting that the RTD end direct bus service between South Central and other predominantly
minority communities, and beach-front communities to the west. For example, the RTD decided
to grant the request of the Palos Verdes Peninsula cities that buses from the inner city not climb
the Palos Verdes hill. RTD service to Manhattan Beach was shortlined heading west at the
request of the City of Manhattan Beach so that inner city residents could not travel to the beach
community. Testimony of Lucius Collier.
153. Even with implementation of a grid system throughout Los Angeles County-in
1975, the RTD's grid system in South Los Angeles still failed to provide adequate service. The
RTD refused to extend a line to Rosecrans and El Segundo, thus eliminating one direct east-west
route to areas outside of the inner city. Robert Williams (RTD Manager, Customer Relations)
Letter in Response to Petition Regarding Elimination of Three Grid Lines Connecting South
Central to Employment Centers (Aug. 26, 1975), H001125. The grid system also failed to
provide continuous service along La Brea through Baldwin Hills to provide an artery to connect
the inner city to the beach cities. Letter by Road Commissioner (June 30, 1975), H001134; RTD
Service Adjustments in South Central (April 21, 1976), H001175-76; Letter by Road
Commissioner (June 20, 1977) (lack o f service through LaBrea because of financial deficit),
H001222; Testimony of Lucius Collier.
154. Within a year after implementation of the grid system, some lines that were direct
routes from Inglewood to the aircraft employment centers were eliminated. While the RTD
eliminated lines and pared down service on its grid system in minority areas, changes to the grid
routes in non-minority areas were minimal. The RTD admitted these changes were not based on
monetary savings or improvement in service. Changes in the grid lines for buses serving
minority communities continued as grid lines were replaced with less direct routes requiring two
G:\mta\mcdiate\rg-bliss 47
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
or even three transfers where no transfers were required with the prior configuration of lines.
Testimony of Lucius Collier.
155. The RTD delivered significantly better bus service to white suburban communities
than to minority communities, providing more reliable bus runs and more direct express routes.
There also were glaring disparities in the allocation of newer buses and more maintenance funds
to the outlying areas than that allocated to the inner city. Testimony o f Lucius Collier; Kenneth
Hahn Letter to Thomas Neusom (Dec. 6, 1979) (regarding overcrowding on Crenshaw and
Florence lines while buses on Wilshire and Santa Monica run every two minutes with fewer
people; requests explanation for disparate service), H001261.
156. The RTD and MTA acceded to desires of some white passengers to ride buses
without the "inconvenience" of riding with minority passengers. For instance, a specialized
LADOT DASH bus service travels between downtown Los Angeles and the University of -
Southern California despite the existence of a regularly scheduled RTD bus on the same route.
Testimony o f Lucius Collier.
D. The Findings Of MTA's 1993 Inner City Transit
Needs Assessment Study And Other MTA Studies
Echo The McCone Commission's Findings_______
157. In 1992, RTD stated that:
With the recent tragic events in Los Angeles and the extremely
severe impact on the people living in the South Central portion of
Los Angeles, it has become apparent that many of the urban
pressures giving rise to the Watts riots of 1965 are still present
today. The McCone Commission analyzed the events of 1965 and
clearly identified the need for public transportation as a key
element for the population to get jobs, training facilities, and to
just acquire the basic requirements for living.
RTD, Project Proposal to Create Transit Enterprise Corridors for the Reimbursement of
Businesses and Housing in South Central Los Angeles (April 4, 1992), C0001442 (noting that in
response to the McCone Commission report, RTD had established a single new bus line "across
G:\mta\mediate\rg-bliss 48
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Century Boulevard linking the South Central communities across the basin as a fundamental link
for a large labor pool to areawide job markets.")
158. Twenty-eight years after the McCone Commission Report, the MTA
commissioned an Inner City Transit Needs Assessment Study. Like the McCone Commission
Report, the Needs Assessment Study was spurred by inner city civil unrest. Inner City Transit
Needs Assessment Study (July I, 1993), D121625 at D121629. "In the wake of the civil
disturbance that struck Los Angeles County in 1992, many community representatives voiced
concerns that the basic mobility accessibility needs of the Inner City were not adequately being
met." Id. See also Dep. o f Karen Heit at 25 (July 27, 1995).
159. The Court earlier found: "The report identified a significant need for transit
service improvements and noted that inner city residents are extremely dependent on public
transit, have very intense transit use, and suffer from significantly more limited access to •*
transportation alternatives. The report documented that 'service delivery problems have more
severe impact in the [i]nner [c]ity than in most other areas of the County'." Findings o f Fact and
Conclusions o f Law re: Preliminary Injunction, at 2 (Sept. 21, 1994), 801637.
160. The Needs Assessment study area was bounded on the north by the Interstate-10
Santa Monica Freeway, on the east by the Interstate-110 Harbor Freeway, on the west by the
Interstate-405 San Diego Freeway and on the south by the Interstate-105 Imperial Freeway. The
578,000 population is 89 percent black or Latino; there are fully 125,000 average weekday MTA
bus boardings. Surveys revealed that "[o]ver 60 percent of the MTA Inner City riders surveyed
were in the lowest category of income measured ($15,000 or less in annual household income),"
that "[l]ess than 5 percent . . . had household incomes in excess of $50,000 per year," and that
"[approximately 48 percent of those surveyed indicated that no auto was available in their
household." Inner City riders, in short, are typical of the "profoundly poor" riders in the MTA
system as a whole. Inner City Transit Needs Assessment Study (July 1, 1993), D121625 at
D121630, D121644-45, D121650, D121671, D121721, D121738, D121772; MTA, Comparing
the Demographic Composition of MTA Riders with the Population of Los Angeles County (Jan.
20, 1994), 008406 at 008407-09).
G:\mta\mediatc\rg-bliss 49
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
161. The Inner City Transit Needs Assessment Study found that: "Investments in future
transportation options are being made primarily outside the [inner city] study area, although
investments are being made along the periphery. No major transportation investments are being
made within the [inner city] study area." The Assessment recommended as an option that MTA
"[a]ccelerate development of the Crenshaw/Prairie Corridor, utilizing federal funds, to provide
rail service in the Inner City." Inner City Transit Needs Assessment Study (July I, 1993),
D121625 at D121631, D121669. Nevertheless, the MTA Board has never approved the
Crenshaw/Prairie project.
162. The Inner City Assessment found that: "[Tjransit services available to the wider
metropolitan area which are not available in the Inner City" include "commuter rail, rail transit,
exclusive transit/HOV lanes on freeways, and shared-ride taxis." The Assessment found that
"[tjhere are currently no economic development strategies being planned in the Inner City that
are associated with transit programs," noting that the MTA was considering a single inner city
joint development project at Vermont Avenue and Manchester Avenue. Inner City Transit Needs
Assessment Study (July 1, 1993), D121625 at D121631-32.
163. Inner city riders received a lesser level of service than MTA provided
county wide. They accounted for 12 percent of all bus boardings, but received only 9.5 percent
of county bus subsidies and 10.3 percent of systemwide bus service. The shortfall in bus
subsidies for inner city riders was 21 percent and the shortfall in bus service was 14 percent.
Inner City Transit Needs Assessment Study (July 1, 1993), D121625 at D121654-55.
164. Inner city residents paid more for transit services than the typical MTA rider.
The farebox recovery ratio in the inner city was 16 percent higher than the County recovery ratio
(.44 compared to .38). In the USC and Los Angeles Coliseum area of the Inner City the
recovery ratio was 50 cents, or over 30 percent higher than the County average. Although the
Inner City area had a greater percentage of discount (elderly, disabled and student) riders and
more transfers than the County average, the inner city riders paid higher fares because "a higher
percentage of users cannot afford to prepay a full-fare monthly pass ($42.00)." The Assessment,
echoing the McCone Commission report, noted that another reason for the higher cash boardings
G:\mta\mcdiate\rg-bliss 50
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
was that an adjacent municipal bus operator, Culver City, did not accept passes and imposed a
separate cash fare. Inner City Transit Needs Assessment Study (July 1, 1993), D121625 at
D121651, D121654.
165. The inner city area has the second highest farebox recovery ratio, a measure of
operating cost, in the system, behind Hollywood, another poor, principally minority area.
Hollywood's farebox ratio was one third higher than the MTA system average. The Inner City's
farebox ratio was 15 percent higher than the MTA average. Correlatively, Hollywood and the
Inner City were ranked first and second lowest of MTA's bus divisions in terms of subsidy per
boarding. The subsidy per boarding in the Inner City was 79 percent of the average county
subsidy while Hollywood's was 56 percent. Inner City Transit Needs Assessment Study (July 1,
1993), D121625 at D121774, D121777.
166. Like the McCone Commission, the Inner City Assessment identified, as an -"unmet
mobility need," the need for "[m]ore direct and faster transit service from the [inner city] study
areas into downtown Los Angeles and other employment centers as well as better access to
county wide transportation options."
One of the frequent complaints heard from the public
during the public meetings concerned the directness of transit
travel between the Inner City and downtown Los Angeles and
other employment centers as well as to countywide transportation
options. People commented that other areas have freeway express
lines into downtown Los Angeles, while the study area does not.
These comments reflect the public's concern about how long
transit travel takes as well as its directness.
Transit service as well as the roadway network in the Inner
City is laid out in a grid system. This grid system has the
advantage of allowing transit riders to travel anywhere within the
system and the disadvantage of forcing about half of the riders to
transfer to complete their trip. A grid system is essential,
G:\mta\metliate\rg-bliss 51
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
however, because without it many trips would not be possible.
Buses traveling Inner City streets move only slightly slower than
MTA Operations county-wide average for local service. With no
express service, little limited stop service to expedite longer trips,
and about half the trips requiring a transfer, transit travel in the
Inner City area moves slowly.
Inner City Transit Needs Assessment Study (July 1, 1993), D121625 at D121664.
167. According to MTA, the MTA bus system generally uses the grid concept of one
bus line on one street, which can make transfers burdensome if bus frequency is poor. The grid
system is based on a street network of parallel streets. The grid system was phased in from 1975
to 1983. According to the Operations Planning Department:
Strong points in favor of the grid concept include relative ease of
understanding since service duplication is minimized. From a
consumer's stand point, the majot drawback is transfer activity
which is generally built into the route structure.
Transfers can be onerous if the service frequency of the lines involved is poor. MTA, A. Leahy,
Status Report on MTA Bus System (July 2, 1993), M514360 at M514369, and report entitled
"Status Report on MTA Bus System, Phase I - June 1993" (July 1993), M514364.
168. The downtown central business district is served by a radial system. MTA, A.
Leahy, Status Report on MTA Bus System (July 2, 1993), M514360 at M514369, and report
entitled "Status Report on MTA Bus System, Phase 1 - June 1993" (July 1993), M514364.
169. Most MTA bus lines go downtown.
170. The Court earlier found that the Inner City Assessment "concluded that MTA
maximizes the benefits of the highly cost-effective inner city bus lines, in part, by routinely
permitting overcrowding levels of 140% of capacity." Findings o f Fact and Conclusions o f Law
re: Preliminary Injunction, at 2 (Sept. 21, 1994). The Inner City Assessment identified relief for
overcrowding as an "unmet mobility need in the inner city." Inner City Transit Needs
Assessment Study (July 1, 1993), D121625 at D121662.
G:\mta\mcdiatc\rg-bliss 52
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
171. The Assessment identified as another unmet need of the inner city the need for
"greater security, cleanliness and comfort on the bus and at bus stops." Inner City Transit Needs
Assessment Study (July 1, 1993), D121625 at D1261664. "The need for "[greater security has
been expressed as one of the most critical transit needs in the Inner City by virtually every group
interviewed." Id. The Assessment explained that: "[B]us riders indicated an attitude almost of
resignation about transit crime. It's as if a fact of life in the Inner City, and those who spoke
have simply learned to live with it and learned how to protect themselves." Riders also
responded that "[r]ail systems are safer because they have more security and police at every
station" and pointed out the lack of "security equity between buses and the rail systems." Id. at
D121681, D121698, D121831.
172. An update of the Inner City Transit Needs Assessment study was prepared by
MTA expert Bradlee F. Williams in 1995. The subsidy per boarding in the inner city-
remains the second lowest in the County. Williams reported that the subsidy in the inner
city changed from $0.79 in 1993 to $0.96 in 1995, and in the County as a whole from $1.00
in 1993 to $1.29 in 1995. The change in the County as a whole (29.0 percent) was greater
than in the inner city (21.5 percent). On the other hand, the farebox recovery ratio in the
inner city remained the second highest in the County. Williams reported that the ratio
decreased in the inner city from 40.9 percent in 1993 to 35.7 percent in 1995, and in the
County as a whole from 35.8 percent to 29.6 percent. The change in the County as a whole
(17.3 percent) was greater than in the inner city (12.7 percent). Bradlee Williams Report at
6 (1995), E000795 at E000801.
173. The update to the Inner City Transit Needs Assessment study showed that
overcrowding remains higher in the inner city (8 percent in 1993 and 6 percent in 1995) than
in the County as a whole (7.4 percent in 1993 and 5.0 percent in 1995). The change in
overcrowding in the County as a whole (32.4 percent) was greater than in the inner city
(25.0 percent). Bradlee Williams Report at 6 (1995), E000795 at E000801.
174. In 1988, the Southern California Association of Governments (SCAG)
coordinated a study of transportation in the Airport Southwest Study Area, an area bounded by
G:\nUa\mediate\rg-bliss 53
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
the Santa Monica Freeway (I-10) on the north, Harbor Freeway (I-110) on the east, Imperial
Highway on the south and LaCienega/San Diego Freeway (1-405) on the west. According to the
study " [t]he analysis shows that the study area is a transit dependency community with 210,601
bus trips made per day by SCRTD with an weekday ridership of over 200,000." The population
of the area was 86 percent black and Latino and had a median income of $13,236 in 1984. The
area's share of public transit usage in 1984 was 15 percent while that for Los Angeles County as
a whole was 9 percent. Approximately 20 percent of RTD's morning peak travel period buses
served the area. Twenty-one of the 26 RTD bus lines serving the study area exceeded the
system average for passengers per hour and passengers per mile on a average weekday. Over
half of the bus lines had a percent of the line cost recovered by revenue greater than the RTD
system average. The Study stated that the high levels of usage "supports the basis for
implementing future public transportation improvements for the area." SCAG, Airport Southwest
Area Transportation Study, Executive Summary (Dec. 1988), C002588 at C002595-98, C002604.
175. The Airport Southwest Study "identified]" the following public transit
"problemfs]:"
. . . It is unsafe to wait for and ride buses during night time hours.
. . . More paratransit service is needed to serve the elderly and
handicapped population.
Id. at C002594.
176. The MTA prepared a draft Southern Corridor Sector Study in December, 1993,
for the southern portion of Los Angeles County, an area roughly bordered by Washington and
Adams Boulevard and the Pomona 60 freeway to the north, Artesia Boulevard to the south and
the Pacific Ocean on the west. The 188 square mile study area had a population of
approximately 1.9 million persons in 1990, 82 percent minority. MTA, Draft Southern Corridor
Sector Study (December, 1993), M331409 at M331410.
111. The Southern Corridor Sector Study documented that "a great deal of section
passenger activity occurs in the east/west direction." According to a survey of operators: "[T]he
east/west non-CBD [downtown] lines were perceived as experiencing the highest level of
G:\mta\mcdiate\rg-bliss 54
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
overcrowding on a daily basis. These lines are operated less frequently by comparison to other
services operated in the area." MTA, Draft Southern Corridor Sector Study (December, 1993),
M331409 at M331555.
178. The draft Southern Corridor Sector Study reported several recommendations as a
result of 30 community public meetings to determine "unmet transit needs." Two of the
recommendations with respect to fares were to "[r] educe fares for seniors and children" and to
"[pjrovide discounted daily passes." With respect to security, the two recommendations were to
"[p]rovide more security on buses" and to "[p]rovide more security at bus stops." Public
comments stressed the need for undercover plain clothes Transit Police on buses and the fact that
more security is provided on trains than on buses. The recommendations with respect to bus
operations included "[r]educe overcrowding" and "[pjrovide more frequent service on east/west
lines." MTA, Draft Southern Corridor Sector Study (December, 1993), M331409 at M331566-
67.
E. MTA Has Failed To Implement The Recommendations
Of The Inner City Transit Needs Assessment Study_______
1. MTA Has Not Lowered Bus Fares In The Inner City
179. The $1.10 basic MTA bus fare in 1993 when the Inner City Assessment was
prepared is slightly less than the 1965 $1.14 fare (in constant 1994 dollars) criticized by the
McCone Commission as "prohibitively expensive.” McCone Commission Report at 65 (Dec. 2,
1965) 950484 at 950559. The present $1.35 fare is substantially higher. L.A. Transit Fares
(undated), M1012009.
180. The Inner City Assessment found that: "The Inner City . . . needs more affordable
transit service." The Assessment recommended that in the near term the MTA, "[c]onsider, in
the context of the ongoing fare restructuring study, providing greater flexibility in pricing through
time-of-day or distance-based fares" on local buses, and proposing fare restrictions for non-peak
local trips. Inner City Transit Needs Assessment Study (July 1, 1993), D121625 at D121690-91.
MTA has adopted neither.
181. The original draft of the Inner City Assessment recommended as a financial
G:\mta\mediatc\rg-bliss 55
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
option that the MTA: "reallocate resources currently earmarked for rail development and use
them to increase funding for the operations in the Inner City." Inner City Assessment,
Preliminary Draft Report (May 1993), M301418 at M301547. The Draft Assessment explained
that the recession had resulted in a shortfall in operating funds, and that the Proposition C
discretionary funds which had gone to bus operations had been diverted by the MTA to other
areas such as "[r]ail operations," "|d]ebt service on [rail construction] bonds already issued,"
and "building cash reserves." Id. at M301545-46.
182. The recommended financial option to reallocate resources currently earmarked for
rail development was crossed out by the MTA staff project director, who with a handwritten note
in the margin added that she did not think it was the consultant's "place to say these things."
Inner City Preliminary Draft Report (May 1993), M301418 at M301547. The final Inner City
Assessment omitted the reallocation recommendation, but left substantially intact the finding that
the MTA was planning to commit Proposition C sales tax funds that could be used for bus
operations for other uses including rail operations, debt service on construction bonds, and
building cash reserves. Inner City Transit Needs Assessment Study (July 1, 1993), D121625 at
D121667-68.
183. Prior to the opening of the Long Beach Blue Line, MTA's predecessor RTD
commissioned a survey of the corridor of the Blue Line on fare issues. Rider/Non-Rider
Attitudes Toward Fare/Payment Media/Distribution Outlets (Feb. 1, 1990) (the “Fare Attitude
Report”), D105486, M332006. The Fare Attitude Report stated that: "The purpose of this
research was to gather information to assist the management of the Southern California Rapid
Transit District in developing and planning future fare structures, payment media and distribution
outlets for the operation of the Metro Blue Line." Id. at D105488, M332007. The Blue Line
Corridor bus riders were 95 percent non-white.
184. The Fare Attitude Report found that riders believed that the fare was "too
expensive" for the value received:
Generally the prevailing attitude within the corridor is that
current fares are too expensive. Three in five surveyed share this
G:\mta\mediate\rg-bliss 56
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
point-of-view, with one in five regarding fares as "much too
expensive."
Riders and non-riders share similar impressions about
current fares. However, non-riders' fare perceptions result from a
disparate view of the current basic cash fare. Non-riders' average
expected fare is 90 cents, as compared to the current $1.10 price.
Id. at D105490 (original emphasis).
185. As summarized by the Fare Attitude Report:
In summary, these findings suggest that the general image of RTD
is fairly good until one utilizes the service. As non-riders or
infrequent riders expand their experience with RTD service
through ridership, their image of RTD deteriorates.
Id. at DI05491. Based on similar findings: "Consideration of future fare hikes should
incorporate improvements in the area of frequency of service, and level of employee and/or
operator customer service." Id. at D10549I. In conclusion, "we recommend any future
consideration of fare increases incorporate service improvements which translate into perceived
valued service." Id. at D105492.
2. MTA Has Not Reduced Overcrowding
Or Improved Inner City Bus Service
186. With respect to the finding of the Inner City Assessment that there was a need for
more direct and faster transit services from the inner city to downtown Los Angeles and other
employment centers, the Inner City Assessment recommended establishing more express and
limited stop lines and seeking funds to develop diagonal routes to increase east-west service and
to provide direct access to high-demand destinations. MTA instituted no new inner city express
lines and no express or limited stop lines connecting the inner city area to downtown. Nor does
it plan to do so. Inner City Transit Needs Assessment Study (July 1, 1993), D121625 at
D121683-86; Dep. o f Karen Heit at 65 (July 27, 1995).
187. The MTA started additional limited stop service on two existing lines a year and
G:\mta\mediate\rg-bliss 57
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
a half later in January 1995. The two lines run on Crenshaw Boulevard between Manhattan
Beach and Hollywood, and on Manchester Avenue between Sepulveda Boulevard and Firestone
Boulevard. The Inner City Assessment identified neither line as exceeding MTA overcrowding
standards. MTA also started a single diagonal-route limited line in July 1995 running from
Imperial Highway and Wilmington Avenue to West Hollywood. All three new lines operate only
at peak hours on workdays, three hours in the morning and three hours in the evening. The cost
of operating those three line and a planned flexible destination shuttle in the Crenshaw area is
1.25 million dollars annually for two years. Inner City Transit Needs Assessment Study (July 1,
1993), D121625 at D121683-84; Update on Progress o f Implementing the 1993 Inner City
Transit Needs Assessment Study (Feb. 24, 1995), D107552 at 107553-54, 107557-58; Dep. of
Dale Royal at 20, 28-31 (Oct. 6, 1995).
188. In order to provide relief from overcrowding, the Inner City Assessment -
recommended near term actions which included "provid[ing] additional service to relieve the
overcrowding that is due to the demand exceeding supply on Inner City bus routes" and initiating
a pilot program and long term recommendations to seek funds to increase the size of the bus
fleet and to increase off-peak service in the Inner City. Inner City Transit Needs Assessment
Study (July 1, 1993), D121625 at D121683-86.
189. The overcrowding relief recommended by the Inner City Assessment was based
on restoring "quality-improving strategies," such as using "gap buses" in the event of breakdown
or delay of a regularly scheduled bus, actions which the MTA had employed when it had
adequate funds. Id. at D121684-85. "These ideas are not new. Virtually all of them have been
used in the past or are still in limited use by the MTA Operations. Many of them were used in
the recent Vermont Avenue demonstration project. Due to budget deficiencies, MTA Operations
has been forced to retreat from their reliance on these quality-improving strategies in order to
maximize revenue service hours." Id.
190. The Vermont Avenue demonstration project, which the Inner City Assessment
cited as a model, had been a three-month experiment from January through March, 1993,
involving the application of "quality-improving strategies" to Line 204, the Vermont Avenue
G:\mta\mediate\rg-bliss 58
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Line. The service and the rider attitudes were routinely compared with those on a parallel inner
city line, Line 207 on Western Avenue. Id. at D121645, D121684-85.
191. As background, the Los Angeles Times in the fall of 1992 had identified Line 204
as the most crime-stricken line in the bus system, with five percent of the riders, but eight
percent of all reported crimes. The Line 204 Vermont Avenue demonstration was initiated not
by MTA but by County Supervisor and MTA Board member Burke, who allocated Los Angeles
County Proposition A Local Return funds to MTA for the demonstration. MTA, A Look At The
MTA (Jan. 1994), 800042A at 800093A.
192. MTA Line 204 on Vermont Avenue is one of the most congested bus lines in the
County. The Inner City Assessment reported that at peak hours, the Vermont Avenue line
exceeded MTA loading standards by 16 percent. Inner City Transit Needs Assessment Study
(July 1, 1993), D121625 at D121684. As noted above, as a result of chronic overcrowding, the
subsidy per boarding on line 204 is only 34 cents, while the county wide bus subsidy in 1992 was
$1.17. MTA, A Look At The MTA (Jan., 1994), 800042A at 800099A-100A.
193. The results of the Vermont Avenue pilot demonstration project were examined
and reported by MTA. The principal "quality-improving strategies" used on Line 204 were, first,
the deployment of uniformed transit police officers on Line 204, weekdays and weekends, to
significantly enhance line security, and, second, the deployment of four additional buses during
the morning peak, base, and weekends, and s'x additional buses during the evening peak to
reduce passenger overloads. The impact of these strategies was assessed by comparing quality of
service on the parallel Line 207 on Western Avenue. The "major findings" were that ridership
on Line 204 at Vermont Avenue increased from five to 15 percent, the additional buses had a
"very positive effect" during weekday peak periods, and the proportion of Line 204 passengers
feeling very safe increased sizably, while at the same time Line 207 riders felt much less safe.
The Line 204 evaluation concluded that "the Pilot Program achieved its main objectives namely
making the Vermont Avenue Line safer and less crowded for passengers and Operators."
Although the evaluation recommended that MTA find the funds to continue operating additional
buses on Line 204 and to implement the program on other lines, the pilot program ended in April
G:\mta\mediate\rg-bliss 59
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
1993. Line 204 Enhanced Service and Security Pilot Program: Impact on Passenger
Overcrowding and Perceptions o f Service Quality and Personal Safety, An Evaluation (May
1993), D104518 at D104521, D104522-24, D104575 and D104580-81; Inner City Transit Needs
Assessment Study (July 1, 1993), D121625 at D121698.
194. The MTA Board — in response to the Inner City Assessment in general, and to
the Vermont Avenue demonstration project and its evaluation in particular — did not authorize
the $5.8 million needed on an annual basis to provide overcrowding relief and increased security
merely on the Vermont Line. And, although the Inner City Assessment identified five other
MTA bus lines in addition to the Vermont Line which exceeded MTA loading standards (Line 38
on West Jefferson, Line 81 on Figueroa, Line 105 along Vernon, Line 117 on Century, and Line
206 along Normandie), the MTA Board did not even authorize $5.8 million for overcrowding
relief to cover all of these inner city bus lines in general. Instead, the MTA Board allocated and
budgeted a total of only $1.25 million per year for each of two years, FY 1994-95 and FY 1995-
96, purportedly to improve the myriad service deficiencies recommended to be remedied in the
Inner City Assessment. Line 204 Enhanced Service and Security Pilot Program: Impact on
Passenger Overcrowding and Perceptions o f Service Quality and Personal Safety, An Evaluation
(May, 1993), D104518 at D104521; Update and Progress o f Implementing the 1993 Inner City
Transit Needs Assessment Study (Feb. 24, 1995), DI07552 at D107555; Inner City Transit
Needs Assessment Study (July 1, 1993), D121625 at D121683-84.
195. The limited overcrowding relief which MTA provided was further diluted because
the MTA staff recommended to the MTA Operations Committee that the overcrowding relief be
spread over ten lines which MTA Operations had identified as "inner city" lines. Lines 33
(Venice), 37 (Adams), 68 (Washington), 81 (Figueroa), 105 (Vernon), 108 (Slauson), 204/354
(Vermont), 206 (Normandie), 207/357 (Western), and 560 (Van Nuys Boulevard - Westwood -
LAX); and that the limited monies also be used to avoid further reduction of service on other
inner city lines. Inner City Transit Needs Assessment Study Recommendations (July 1, 1993),
D121625; Update on Progress o f Implementing the 1993 Inner City Transit Needs Assessment
(Dec. 5, 1994), 008382 at 008384; Dep. o f Karen Heit at 56-57 (July 27, 1995).
G; \mta\mcdiate\rg-bliss 6 0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
196. According to MTA scheduling staff, the portions of the $1.25 million annual
inner city overcrowding relief intended as additional funds, in fact, were and are being spent
countywide. As to the funds intended to avoid further service cuts on overcrowded lines in the
inner city, these funds too were spent countywide as well. As a result of systemwide reductions
of service, there was a net reduction in inner city bus service in 1994-95. Dep. o f Frank
Schroederat 16-19, 21-22, 31, 36 (Oct. 10, 1995).
197. With respect to the short-term recommendation by the Inner City Assessment that
MTA itself initiate pilot programs on one or two inner city bus lines, MTA had done nothing to
implement the recommendation more than two years later. In order to allow buses to travel
faster, the Inner City Assessment had recommended in the short-term the use of designated bus
lanes and of signal preemption devices. Two years later, no bus lanes had been funded or
constructed in the inner city and no signal preemption devices installed. Inner City Transit.
Needs Assessment Study (July 1, 1993), D121625 at D121685; Dep. o f Dale Royal at 27, 34-35,
38 (Oct. 6, 1995); Dep. o f Karen Heit at 59, 82-83 (July 27, 1995).
198. With respect to the long term recommendation of the Inner City Assessment to
seek funds for more buses for the inner city, MTA two years later had done nothing other than
to state in its Long Range Plan that it would increase the bus fleet by 300 additional buses for
Los Angeles County over the next ten years. No such buses have yet been allocated to the
inner city area. Rather than add buses, the MTA has decreased its bus service in the inner city
area in the last two years, as noted above. Dep. o f Dale Royal at 18 (Oct. 6, 1995); Dep. o f
Frank Schroeder at 31 (Oct. 10, 1995).
199. In fiscal year 1993-94, MTA budgeted a total of 6,972,000 in revenue service
hours. Fully 6,875,000 of these hours were for bus (98.6 percent), 81,000 were for Blue Line
(1.2 percent) and 16,000 were for Red Line (0.2 percent). For fiscal year 1994-95, MTA staff
recommended a 5 percent drop to 6,594,585 revenue service hours, to 6,500,000 hours for bus,
to 75,280 for Blue Line, and an increase to 19,305 for Red Line. MTA, Revenue Service Hours
(undated), M l020890.
200. MTA's fiscal year 1994-95 service reduction plan was estimated to save $21
G:\mta\mcdiate\rg-bliss 61
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
million by reducing revenue service hours 5.5 percent to 6,590,000. The planned service
reductions would result in a loss of 2.9 million annual bus passenger boardings. In May 1994,
MTA staff anticipated that service the service reduction plan would cause "a 6.8 percent ridership
deflection." MTA, A. Leahy, FY94-95 Service Reduction Plan (May 26, 1994), M1020926 at
M1020926-28.
201. After the 1992 civil unrest in Los Angeles, RTD proposed a transit corridor
development program along 8-10 bus corridors for bus and area improvements, noting that there
were 12 South Central bus lines with greater than 13% average standees during the peak hour
and ridership in excess of 12,000 daily boardings that were candidates for such investments.
Project Proposal To Create Transit Enterprise Corridors For The Reinvestment o f Businesses
and Housing In Soouth Central Los Angeles Prepared by SC RTD (undated), C001442 at
C001444-47.
202. The bus transit enterprise corridor program was never implemented. Testimony of
Tom Rubin.
3. MTA Has Not Improved Security On Inner City Buses
203. In 1993, the MTA Transit Police applied for federal funds for a community-based
policing program in South Central Los Angeles between Exposition Boulevard on the north, the
Blue Line on the east, Rosecrans Avenue on the south and Hawthome-LaBrea Avenue on the
west. The Transit Police stated:
The residents of the target area, many of whom are transit
dependent, use the MTA transit system for their work commute,
school and shopping transportation, and all of their other
transportation, needs on a daily basis. The transit system is a vital
lifeline for the people of South Central Los Angeles and it must be
made safe for the people of these neighborhoods. The full range
of social, community and economic reconstruction of South
Central Los Angeles is dependent upon a safe and adequate public
transit system.
G:\mta\mcdiatc\rg-bliss 6 2
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Letter from Sharon Papa, Chief o f MTA Police to U.S. Department o f Justice Office o f Justice
Programs (Nov. 30, 1993) M700719 at M700724.
204. The Inner City Assessment recommended that MTA police officers be assigned to
buses in the inner city, and that funds be sought for more officers to be assigned to riding buses
on a regular basis. Although the MTA obtained a grant for $1.1 million for police officers to
ride buses, the funds have been used to assign 12 transit police to ride buses and to patrol bus
stops on bicycle, on foot, and in police cars in areas that extend outside of the inner city. In
contrast, the MTA Line 204 Vermont Avenue demonstration project involved officers riding
every third bus on a single inner city bus line. Inner City Transit Needs Assessment Study (July
1, 1993), D121625 at D121696-97, Update on Progress o f Implementing the 1993 Inner City
Transit Needs Assessment Study (Dec. 5, 1994), 008382 at 008396; Dep. o f Karen Heit at 100-
01 (July 27, 1995); MTA, A Look At The MTA (Jan. 1994), 800042A at 800093A.
205. The MTA Line 204 demonstration project increased security costs per passenger
to 12 cents, which was four times the county wide bus system's 3 cents per passenger, but less
than a tenth of the $1.29 Blue Line or Metrolink personal security cost per passenger. MTA, A
Look At The MTA (Jan. 1994), 800042A at 800093A-94A.
206. The total cost of providing RTD transit police security for 90 days for line 204
was 1.86 million dollars, requiring the deployment of officers on 447 eight hour shifts. RTD,
SC RTD Transit Police Expenses for Line 204 (undated), 002257.
V. IN THE LAST DECADE, MTA SHIFTED RESOURCES
FROM THE BUS SYSTEM TO DEVELOPMENT OF
METROLINK AND MTA-OPERATED RAIL LINES, TO
THE DETRIMENT OF POOR MINORITY BUS RIDERS
A. MTA Developed Rail Lines That Are Inefficient And Not
Cost-Effective. Diverting Financial Resources From Bus Operations
207. In 1985, the LACTC began shifting funding for RTD bus operations to rail
construction, leading to a net decrease in transit use in Los Angeles County. MTA, Tom Rubin,
Comments on "For the Record: A Practical Mobility To All Los Angeles County" (June 10,
1994), 011736 at 011742-43. Since the end of FY85, when the rail construction program kicked
into high gear, RTD/MTA transit ridership per capita fell from 58.1 in FY85 to 39.4 in FY95 —
G:\mta\mcdiatc\rg-bliss 63
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
a reduction of almost one-third (32.2%) over a ten year period. Amended Expert Report and
Response to "A Report by Jeffrey M. Zupan" by Thomas A. Rubin (Jan. 1, 1996), E1000379.
208. The light-rail Long Beach Blue Line was funded entirely by 1980 Proposition A
A<t local sales tax funds. LACTC, N. Peterson, Proposition A Rail Corridors (Sept. 6, 1991)
(Information Item), M0360082 at M0360086. The heavy-rail Metro Red Line, according to the
LACTC, is being built with federal and state funds, private benefits assessments, and Proposition
A funds. Id. The light-rail Green Line was supposed to be funded both by Proposition A funds
and by 1990 Proposition C [A<t local sales tax funds. Id.
209. On June 18, 1993, MTA finance official and former RTD Comptroller Tom
Rubin, wrote then-CEO Franklin White a memorandum opposing adoption of a proposed FY
1994 MTA budget with ten-year operation and capital recommendations which "if adopted,
would lead to virtually certain financial disaster within a few years."
The only rational action that can be taken at this point is an
absolute "bare bones" budget that does not allow any further
initiatives to be begun without a guaranteed source of funding or
offsetting cost savings for the entire long-term financial plan. This
specifically includes that the Pasadena Line must be immediately
put on hold at least until a large number of "solutions" come
through. All studies pertaining to potential future rail lines and
extensions, none of which can be built within ten years even under
the most optimistic outcomes, should be immediately halted. All
major capital decisions should be put on hold until the 30-Year
Plan is completely redone from scratch, with the work being
performed by a new set of professionals who are not identified
with the existing failed document and are not dedicated to
perpetuating this fairy tale, and who are not afraid to tell the CEO,
the policy board, and the public the truth.
MTA, Rubin, Review o f FY94 Budget (June 18, 1993), 003004 at 003004-05 (original emphasis).
G:\mta\mcdiatc\rg-bliss 64
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
210. Building and operating all 14 rail lines proposed by the 1992 30-Year Plan would
have cost roughly 11.4 billion dollars. According to RTD, 2,346 buses, along with construction
of bus yards and purchase of replacement buses, could have been purchased and operated for the
same amount of money. Letter from Tom Rubin to RTD Director Raggio (Sept. 27, 1991),
003351 at 003355.
211. MTA's 1995 20-Year Long Range Plan sets aside $417 million for planning rail
projects, i.e., contracting environmental studies, staff support, overhead, and Board-directed
studies for rail construction.
If the proposed 417 million dollars were instead to be allocated to
bus transit operations, 468 million bus passengers could be carried.
These bus passengers are 92 percent of the number of passengers
MTA estimates would be carried if all 14 rail lines proposed in the
Long Range plan were built and operated for the period of the
Plan.
Rubin, Rail Planning Costs (undated), 007060 at 007060-62.
212. In its comments on the MTA's 20-Year Plan, SCAG questioned the need for a
number of MTA long range planning studies. "[T]here are opportunities for the LACMTA staff
to work more closely with SCAG to address these issues in the long range planning with which
SCAG is charged. This could save the LACMTA planning funds and avoid a possible
duplication of effort." Letter from Mark Pisano, SCAG Executive Director, to Franklin White,
MTA CEO (March 17, 1995), M323133 at M323137.
213. Federal authorities recognize historic shortcomings of rail planning. The Federal
Transportation Administration's financial capacity policy specifically notes that: "Serious
problems can result when financial planning is not adequately performed. Cases include the
many ' New Start’ cities which have been forced to reduce service levels in order to afford
putting new lines into service, and, as has been the case far too often, rail lines originally
intended to save operating funds but which increased the cost." Quoted in RTD, Ralph L.
Stanley, Impact o f Federal Transit Administration "Urban Mass Transportation Financial
G : \mta\mc<Jiate\rg-bliss 65
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Capacity Policy" in Current Debate on $117 Million ofSCRTD Funding (UMTA [FTA] Circular
7008.1, March 30, 1987), 950123.
214. RTD's analysis of systems in the United States with light rail and bus operations
revealed that the weighted average cost per passenger mile was not significantly different
between light rail and bus costs by city. The analysis concluded that "the corridor served by
light rail is a far heavier transit use corridor than the average bus corridor in the same cities. . . .
If light rail is barely equal on operating costs to bus, where light rail is given the major
advantage o f the most crowded routes, the only conclusion that can be reached is that bus has a
significant overall cost advantage over light rail in the vast majority of circumstances where the
issue is construction of a new light rail line.” RTD, T. Rubin, Light Rail vs. Bus Cost Per
Passenger Mile (April 8, 1991), 010072 at 010073-75.
215. The MTA explicitly refused to consider cost-saving possibilities regarding rail
operations and construction when it did cost studies on bus operations. Dep. o f Terry Matusmoto
at 200-03 (Sept. 19, 1995) (Vol. 2), and exhibits cited. The MTA subsequently commissioned a
cost study of the rail program by Arthur Andersen in 1995. Id. at 200-03, and exhibits cited.
The 1995 Arthur Andersen Report condemned the lack of cost controls, cost effectiveness, and
cost efficiency at the MTA. See generally MTA, Arthur Andersen Final Report o f
Recommendations (April 24, 1995), D121959, and supporting documents. One year later, Arthur
Andersen conducted a follow-up study to see whether MTA was implementing the critical
management recommendations contained in its 1995 report. MTA is not. “[Ojverall progress
made-to-date is behind schedule and reason for concern.” Arthur Andersen, Implementation
Performance Review at 5 (March 1996). [T]he members of the Board are still relatively
inexperienced in construction and transportation issues . . . . [T]he Board still demonstrates
divisive and politically charged behavior.” Id. at 16. The MTA Board makes decisions about
the cost of rail based on politics rather than facts:
“The Board' s tendency to micro-manage and ‘fix the
blame' continues to overshadow its willingness and conviction to
receive the true and complete cost picture. The result is an
G:\mta\picdiate\rg-bliss 66
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
atmosphere at the MTA where ‘fear reigns' and the staff is afraid
to suggest that there may be a problem unless absolutely certain.
“This behavior conflicts with the Board' s need for the staff
to present concise information on budget impacts in a timely,
forthright manner. Therefore, Board members must be willing to
listen to the actual budget impacts and the alternatives presented
by the staff without publicly ‘shooting the messenger' as suggested
in Franklin White' s departing speech. However, the staff must
also do its part. It has done a poor job in the past of consistently
reporting overruns as documented by the Inspector General' s (IG)
report on the Blue Line Extension.”
Id. at 12-13. MTA fails to play an effective oversight role over its rail construction consultants.
“The Inspector Generals report on the Pasadena Blue Line does a very effective job of
documenting the M TA's lack o f oversight.” Id. at 11 (original emphasis). See also Dep. of
Richard Alatorre at 42-43 (Oct. 17, 1995) (The MTA spends too much on Metrolink rather than
on bus riders who "pay the freight"); Dep. of Michael Antonovich at 9-10, 48-50, 60-62, 74-77
(Oct. 16, 1995) (subway and heavy rail projects are not cost effective and not cost efficient, and
they take money away from transit projects that are).
216. The budget for the not-yet-under-constructuion Pasadena Line, a light rail line,
illustrates the runaway cost of MTA' s rail projects: "The current budget for the Pasadena Line
project is $67 million to $71 million per mile. This is without precedent in the industry and does
not appear to be warranted by the complexity of the project." Peer Review Report for the Los
Angeles County Metropolitan Transportation Authority: Pasadena Blue Line (April 25, 1995),
M323035 at M323047. The Pasadena Line is nevertheless one of the "baseline" projects that was
taken for granted and not even evaluated in the MTA's 20-Year Plan. Id. at 25-42, and exhibits
cited.
217. A 1990 report by Pickrell for the U.S. Department of Transportation Urban Mass
transportation Administration (UMTA) estimates that:
G:\mta\mcdiate\rg-bliss 67
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
(i) the recently installed heavy rail systems in Atlanta, Baltimore, Miami, and
Washington have ridership shortfalls averaging 35 percent of their respective
forecasts;
(ii) the new light rail facilities in Buffalo, Pittsburgh, Portland, and Sacramento show
average ridership shortfalls of 65 percent;
(iii) the weighted average cost per passenger round trip on the heavy rail/subway
systems is about $16.61;
(iv) the weighted average cost per passenger round trip on the light rail systems is
about $15.92; and
(v) three of these eight transit districts lost net system patronage after rail facilities
were added.
Reponse to "A Report by Jeffrey M. Zupan" by James E. Moore (undated), E100000 (original
emphasis).
B. MTA Spent Nearly $1 Billion To
Construct The Long Beach Blue Line
218. As originally proposed, the Long Beach Blue Line ran from Long Beach to
downtown Los Angeles along the route of old Southern Pacific rail tracks without any stops in
the heavily minority areas that the Long Beach Blue Line traverses. Intermediate stops were
added only after public protests. Even then, the stops on the Blue Line are few and far between
compared to the many stops on the local bus lines that the MTA eliminated after the opening of
the Blue Line. Testimony o f Thomas Rubin, Lucius Collier, and Martin Wachs.
219. The Coalition for Rapid transit objected to the proposal for the Blue Line because
it "does little or nothing for the two travel publics . . . that is not already available to them via
SCRTD buses."
For example, the Freeway Flyer from Long Beach to downtown
Los Angeles makes the trip in about 50 minutes in rush hour
traffic. The slow-moving streetcar vehicle offered by LACTC will
also take 50 minutes, but cost an additional $600 million of our
G:\mtaVnediatc\rg-bliss 68
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
tax money!
This line makes absolutely no sense from the standpoint of
Long Beach unless it is faster, cheaper and more convenient than a
bus ride.
ie k ie
There is no escaping these essential facts: 1) The northern
part of the old PE Willowbrook Line, which is the basis of the
LACTC proposal, is an industrial wasteland with a low population
density. Most of the people who did live here have moved west
to the area around Vermont Avenue. 2) The major activity center
and densest population between LA and Long Beach is at and near
Exposition Park, which is a great recreation, sport and cultural
center. The Community Redevelopment Agency, the University of
Southern California, the California Museum of Science and
Industry have all protested the lack of a transit station at
Exposition Park. Your excuse has been that CALTRANS will
provide a busway about 20 years hence. Freeways are not useful
travel routes for inner city populated areas, however good they
may be for suburban areas. Pedestrian approaches are plain
horrible and even bus stops are awkward because of off-ramp
traffic and steep access paths. 3) The LACTC LA-Long Beach
Line is a scandalous example of a political-engineering approach
which is heading for economic disaster. So little thought is given
to supplementing the Proposition A monies by way of economic
development that it is a source of astonishment to ma[ny] urban
transportation specialists. Long Beach is a spectacularly bad
example with practically no attention being given to a local
development input to make transit stops self-financing.
G:\mta\mediate\rg-bliss 69
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Letter from Coalition for Rapid Transit to LACTC (March 26, 1985), M339167 at M339167-68.
220. Two-thirds of Long Beach Blue Line riders are former passengers of express and
local bus lines that the Blue Line replaced. When the Blue Line opened in 1991, the express bus
lines that were replaced charged $2.70 cash or $90 for a monthly pass. The Blue Line charged
only $1.10 cash fare or $42.00 for a monthly pass. MTA, A Look At The MTA (Jan. 1994),
800042A at 800089A. Blue Line riders continue to be charged less than express bus riders.
221. “The Blue Line has one of the lowest, if not the lowest, urban rail fares in the
United States.” Memo from Tom Rubin to Richard Stanger re Metrolink Costs, at 5 (April 24,
1993), 011067 at 011071. The fares, in fact, are so low that the Blue Line fare collection costs
actually exceed the fares collected: “in FY92 we spent $4.9 million in fully allocated collection
costs to collect $4.2 million in cash fares.” Id. at 6, 011072.
222. According to the federally-required cost/subsidy per-new-passenger statistic-which
accounts for former bus riders that transfer to rail and adjusts for value of time saved by faster
transit trips, the annualized subsidy per-new-passenger for the Long Beach Blue Line was
$1,083.43. MTA, A Look At The MTA (Jan. 1994), 800042A at 800101A-02A.
223. An assessment of the Long Beach Blue Line found that it was not cost effective
relative to a bus alternative.
To assess its cost-effectiveness, James Moore used a
capital cost of $877 million (as reported, but underestimated
because many Blue Line-related costs were not charged to the
project), standard assumptions of a 10 percent opportunity cost of
social capital and a 40-year project lifetime, and operating costs of
$38.6 million in fiscal 1991. Using the Southern California Rapid
Transit District's August, 1991 boardings of 32,600 per day (and
assuming that weekend-day matches weekday boardings), Moore
computed an annual cost per passenger roundtrip of $7,873 — or
over $21 per day.
But that is not the end of the story. Survey responses
G:\mta\mcdiate\rg-bliss 70
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
indicate that only 21 percent of riders were previously drive-alone
motorists; most of them previously rode the (much-less-subsidized)
bus. Thus, as a means of "getting single-occupant vehicles off the
freeway," the Blue Line costs taxpayers $37,489 per year for every
such car eliminated. The Blue Line's trip costs are about double
those on the four most recently completed light rail projects
studied by the U.S. Department of Transportation.
Peter Gordon & Harry W. Richardson, The CounterPlan for Transportation in Southern
California: Spend Less, Serve More (Feb. 1994) (footnotes omitted), M324043 at M324054-55.
224. An MTA survey shows that fully 95 percent of the riders of the bus lines in the
Long Beach Blue Line corridor were minority and only five percent white. By contrast, 24
percent of Long Beach Line riders boardings are white. In addition, the number of boardings
underestimates the extent to which the Blue Line serves whites because white riders take
significantly longer trips. Controlling for distance traveled, using passenger miles, the ridership
is 32 percent white, one of the highest white riderships in the MTA. Brian Taylor, Martin
Wachs, et al., Variations in Fare Payment and Public Subsidy by Race and Ethnicity: An
examination o f the LAMTA, at 17 (Nov. 5, 1995), E100567 at E100584; Testimony o f Brian
Taylor and Thomas Rubin.
225. The Long Beach Blue Line was built to accomodate the increased white ridership.
It was not built to provide either better transportation or redevelopment for the minority
communities that it traverses. During the consideration of the Long Beach Blue Line, MTA's
predecessor LACTC agreed with the criticism that "[t]he northern portion of the proposed line
does not adequately serve the main black population center of south central Los Angeles, and it
is not capable of much redevelopment." LACTC acknowledged that: "It is true that the south
central Los Angeles communities of Adams, Exposition, and South Vermont would not be well
served by the proposed line, nor would the Hoover or Adams-Normandie redevelopment
projects." The Long Beach - Los Angeles Rail Transit Project, Final Environmental Impact
Report (March, 1985), M306934 at M307206.
G:\mta\mcdiate\rg-bliss 71
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
226. In January 1995, MTA decided not to impose distance - based fares on the Long
Beach Blue Line that the MTA Board had adopted in July 1994.
C. MTA Spent $1 Billion To
Construct The Green Line
227. Gordon and Richardson estimate that the Green Line cost approximately one
billion dollars. Peter Gordon & Harry W. Richardson, The Counter Plan for Transportation in
Southern California: Spend Less Serve More (Feb. 1994), M324043 at M324055.
228. Similar to what happened along the Blue Line, the opening of the Green Line in
August 1995 was preceded by MTA reducing and canceling bus service along the rail corridor.
An "aggressive" set of changes was implemented to reduce bus service and to reduce costs in the
amount of 2-3 million dollars annually by rerouting bus services to serve nearby Green Line
stations, adjusting the frequency of bus service for lines parallel to the Green Line, and cutting
back bus service to terminate at Green Line stations. The effect of this policy is to create a
ready pool of rail riders, but also to disrupt travel patterns of bus riders making local trips. Dep.
of Karen Heit at 57-58 (July 27, 1995); Dep. o f Dana Woodbury at 481 (Aug. 14, 1995) (Vol.
4); Testimony of Brian Taylor.
229. According to MTA staff:
Unlike the Metro Red and Blue Lines, the Metro Green
Line was not built in a major bus corridor where replacement of
duplicative bus service was possible. No bus lines, or substantial
line segments will be conceded as a result of Metro Green Line
service. The only existing bus line that duplicates the Metro
Green Line for any significant distance is Line 120 (Imperial
Highway-LAX Bus Center/Brea Mall). This line will be
segmented and truncated to serve local trips, and to encourage
people making longer trips to use the Metro Green Line.
In addition to the cost of operating the Green Line, the MTA proposed a Metro Green Line
Bus/Rail Interface Masterplan to spend an additional $6.4 million annually on MTA services.
G:\mta\mediate\rg-bliss 72
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Three quarters of the added cost was to add 13 new feeder bus service routes, and $1.6 million
was to divert existing MTA bus lines to access Green Line stations. The MTA also planned
upward of $8 million in additional municipal operator costs to access Green Line stations. Thus,
opening the Green Line required MTA to spend $14.8 million annually to provide bus feeder
service. The Interface Plan makes no claim that it will improve service to riders. Because of
unavailability of funds, MTA adopted a less expensive Intermediate Access Plan. MTA, A.T.
Leahy & J. Wilson, Adoption of the Final Metro Green Line Bus/Rail Interface Plan and
Implementation of Phase I for June 1995 (Feb. 23, 1995), D ll 1775 at 111775-78.
230. The Green Line stops in El Segundo within sight of the Los Angeles International
Airport (LAX). A bus is required to reach LAX. The Los Angeles Times referred to the Green
Line as the "train to nowhere." L.A. Times at B2 (Oct.6, 1995).
231. MTA was able to complete the Green Line only by transferring $300 million
from Proposition C sales tax revenues designed to be used for highway improvements such as
high occupancy vehicle (HOV) lanes on highways and freeways.
232. According to former CEO Franklin White:
When I arrived in April of 93, the organization was bankrupt. . . .
[0]n the construction side there was not enough money to fund
the Green Line. Everybody in this room who was on the Board at
that time should remember that. We had to move roughly $300
million from TSM, transportation systems management and TDM,
transportation demand management, in order to finish the Green
Line. Think how preposterous that is. But there was not enough
money to pay the bills that were headed toward the organization.
Frank White didn't do that. Frank White said you better find this
$300 million. And by the way, you're taking it away from
activities which are more desirable than the Green Line today.
MTA, Transcript o f Franklin White's Comments Made in Open Session Regarding His
Performance Appraisal, December 20, 1995, Board Meeting, at 3-5 (undated), M808381 at
G:\mta\mediate\rg-bliss 73
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
M808383-85.
D. MTA Plans To Spend $5.8 Billion
To Construct The Red Line_____
233. A recent assessment has found that the heavy-rail Red Line subway from
downtown Los Angeles to MacArthur Park cost almost one and a half billion dollars, or $453
million per mile, and is not cost effective.
The recently opened "minimum operable segment" of the
underground Red Line (4.4 miles, from Union Station to
MacArthur park, as advertised by the agency but recently admitted
to be only 3.2 miles; the 4.4 miles includes the length of rail
storage tracks) has cost $330 million per mile when cost overruns
are accounted for (actually, $453 million per mile at 3.2 miles).
That contrasts with $188 million per mile when Congress provided
the initial funding in 1983 (which would be $265 million in 1992
dollars). It is also much larger than the $101-million per mile
cited for "CBD = 0.7 miles" in the first adopted environmental
impact statement on this project in 1979 ($170 million in 1992
dollars). The 25-cent "teaser" fare has been extended indefinitely
because ridership has averaged only 15,000 boardings per
weekday. When operating costs become known, the full costs per
passenger will probably surpass those documented for the Blue
Line. . . . [T]he recent closings of landmark enterprises along the
Red Line route (including the Ambassador Hotel, Bullocks
Department Store, and the Sheraton Town House Hotel) indicate
that real estate markets are not optimistic about the performance of
the subway.
Peter Gordon & Harry W. Richardson, The CounterPlan for Transportation in Southern
California: Spend Less Serve More (Feb. 1994), M324043 at M324055.
G:\mta\mediate\rg-bliss 74
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
234. A comparison of travel time via the proposed Red Line and existing bus service
from the San Fernando Valley to the Los Angeles Civic Center showed that the travel time on
MTA Bus Line 424 was 18 minutes while the travel time on the proposed Red Line would be 40
minutes, or 122 percent greater. Rubin, Impact on Travel from San Fernando Valley to Civic
Center o f Operating of Red Line (undated), 005244 at 005245.
235. The MTA has not conducted any surveys of the race or ethnicity of Red Line
riders. However, LADOT's DASH Downtown service provides comparable services for a similar
population, and both DASH and the Red Line charge the same 25 cents to move people around
downtown. Thirty-two percent of DASH Downtown riders indicating race or ethnicity are white.
DASH Downtown On Board Survey Final Report (April 1994), S0890 at S0917.
236. The white ridership of the Red Line actually is higher given that the Red Line
serves large numbers of Metrolink riders, at least 69 percent of whom are white. Dep. o f -
Richard Stanger at 124 (July 27, 1995) (Vol. I); MTA, Metrolink Line by Station (undated),
M800809 at M800821. Currently, 38 percent of Metrolink passengers use the Red Line.
Metrolink 1995 On Board Survey (1995), M800691 at M80070T, seg_ also MTA News Release
(Jan. 21, 1994) (MTA put more Red Line trains in service and synchronized Red Line trains to
accommodate Metrolink transfers), M339291.
237. Although the Red Line was originally designed to run on the heavily-travelled
Wilshire Corridor, its route has been changed so that its route will no longer run on Wilshire
after Western Avenue.
238. The MTA Board has approved two extensions of the Red Line.
239. MTA estimates that the Red Line will cost $5.8 billion.
E. MTA Plans To Spend Over $800 Million To Build
The Pasadena Light Rail Line Using Funds That Could
Be Used On MTA Bus Operations__________________
1. Background
240. The Pasadena Line is one of the “baseline” projects in the MTA’s recent 20-Year
Plan. The relative merits of the Pasadena Line were never evaluated and compared with other
projects in the Plan. In planning the Pasadena Line, the MTA did not consider any bus
G:\mta\mcdiate\rg-bliss 75
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
alternative. MTA, Certification of Supplemental Environmental Impact Report, Budget Approval
and Project Adoption for the Pasadena - Los Angeles Light Rail Transit Project (Jan. 13, 1993)
01411 at 014026; LACTC, Final Environmental Impact Report, Pasadena - Los Angeles Light
Rail Transit Project (Feb., 1990), 951033 at 951033, 951039-46.
241. The current admitted MTA budget for the Pasadena Line is $803.9 million. The
Line is currently configured as a 13.7 mile, 13 station light rail transit line that will run from Los
Angeles Union Station to Sierra Madre Villa Station on the east side of the Pasadena central
business district. The current $803.9 million budget does not include the many of the costs of
getting the Line ready to operate, such as rail cars, costs of issuing and servicing debt, and many
other costs that MTA commonly does not associate with rail lines but should.
242. MTA has had to resort to discretionary funding sources to finance the
construction of the Pasadena Line because state rail construction bonds that MTA had anticipated
using for the Pasadena Line were defeated at the polls and Proposition A local tax revenues for
rail projects have been exhausted on other rail projects.
243. The California Legislature authorized a three billion dollar statewide rail bond
package in 1989. While the first billion dollar bond passed in 1990, both the second billion
dollar bond, Prop 156, and the third billion dollar bond failed in 1992 and 1994, respectively.
Fully $316.6 million from the failed 1992 bond was supposed to go to the construction of the
Pasadena Line. LACTC, N. Peterson, Impact o f Failure o f Proposition 156: The $1.0 Billion
Rail Bond (Dec. 1, 1992), M032001 at M0320002.
244. According to MTA’s predecessor, “[t]he immediate impact of the loss of Prop.
156 funds is that the Pasadena Light Rail Line, which will be ready to go this spring, has lost
half its budgeted funding.” LACTC nevertheless recommended that “available state funds would
be allocated to projects ready to expend those funds, such as LACTC’s Pasadena Light Rail
Line.” Id. M0320002, M0320006-07.
245. MTA’s main source of local tax revenue funding dedicated to rail construction is
Proposition A 35% Rail Construction and Operations funds. Declaration o f Tom Rubin (June 29,
1996) (“Rubin Decl.”). Proposition A was enacted in 1980 as a half cent local Los Angeles
G:\mta\mediate\rg-bliss 76
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
County tax. Proposition A currently is almost entirely utilized for debt service commitments on
funds borrowed for past rail capital expenditures and therefore is not available for the Pasadena
Line. Id.
2. The MTA Board Voted To Use Discretionary Funds
For The Pasadena Line, Even While Contending
That Bus Fare Restructuring Was Necessary_______
246. The Court previously found that a month after voting to eliminate the monthly
bus pass and to raise bus fares purportedly because no other funds were available for bus
operations, the MTA voted to spend discretionary funds for the planning of the Pasadena Line:
MTA Board member Villaraigosa urged his fellow MTA Board
members to avoid the need to harm bus service later by refusing to
approve a $59 million discretionary fund allocation to plan the
Pasadena rail project. The MTA Board, ignoring Mr. Villaraigosa
and the plaintiff, voted to allocate the $59 million to that project.
Plaintiffs claim that the $59 million should have been spent on bus
services to avert the bus fare increase and pass elimination.
Findings o f Fact and Conclusions of Law Re: Preliminary Injunction (Sept. 21, 1994) at 2, f 4.
A week after the MTA Board voted fare restructuring, the Board voted to spend an additional
$123 million on the Pasadena Line. Id. at 3, f 5.
247. Then-CEO White characterized MTA's decision to proceed with the Pasadena
Line as "idiocy."
. . . [Ojn the issue of risks that the CEO must take — any CEO —
I faced several right away. One of them was Pasadena. And at
the time in 1993 after having had to move several hundred million
to get the Green Line finished the issue of Pasadena going to
construction was on the table in the budget to be developed for
93/94. I thought frankly it was some kind of idiocy to talk about
commencing a multi-year construction period of Pasadena given
where we were. I though it was self-evident that it didn't make
G:\mta\mcdiate\rg-bliss 77
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
sense. I got into a 3-month fight over Pasadena which delayed the
adoption of the budget, which ended in a way which was against
my better judgment, but I made enemies in that regard. Made
enemies, people who remembered that "I was not supportive" at
the time.
MTA, Transcript o f Franklin White's Comments Made in Open Session Regarding His
Performance Appraisal, December 20, 1995, Board Meeting, M808381 at M808383-85.
248. Part of the $123 million the MTA authorized for planning in 1994 was $32.8
million of Proposition C 25% Transit Related Highway Improvement funds, which include high
occupancy lane (HOV) funds. CEO White unsuccessfully opposed the use of HOV funds for rail
construction as “dangerous” and “spending] money we didn’t have,” noting that HOV projects
are better “producers of congestion relief.” MTA Board Minutes (June 20, 1994), 951724 at
951726.
249. After his unsuccessful efforts to avert the funding of planning and early work on
the Pasadena Line with discretionary funding, Mr. White felt “traumatized” and unable to obtain
more discretionary funding for bus operations. MTA, Transcript o f Franklin White’s Comments
Made in Open Session Regarding His Performance Appraisal, December 20, 1995 Board
Meeting at 10, M808381 at M808390 (“I agree our discretionary dollars ought to go to making
this bus system a better bus system. And I would plead guilty, I will plead guilty, that
traumatized by the events in 93 regarding rail construction, I didn’t at that point run to take every
dollar into buses, but I think we need to make that bus system better.”).
3. The 1996 Designation of Discretionary Funds for Construction
250. On February 28, 1996, the MTA Board approved a staff recommendation to
approve a new budget for the Pasadena Line of $803.9 million, a reduction of $193.8 million and
a “reaffirm[ation of MTA commitment to the [Pasadena Line] project and the financial capacity
to fund the project with a ROD [Revenue Operations Date] in 2001.” Pasadena Blue Line
Report to the MTA Board o f Directors from Patricia V. McLaughlin, Arthur T. Leahy, and
Stanley G. Phernambucq (Feb. 22, 1996), 960117. An amendment was defeated to proceed with
G:\mta\mcdiate\rg-bliss 78
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
the Pasadena Line only if bus services and fares were safeguarded.
251. The $803.9 million budget for the Pasadena Line is a $193.8 million reduction
from the previous $997.7 million budget, based on implementation of cost reduction tactics
proposed in a peer review report and a cost reduction report. Operations Peer Review Committee
Report on the Pasadena Blue Line (Oct. 10, 1995), and Pasadena Cost Reduction Task Force
Report (Nov. 29, 1995), attached as Exhibits 1 & 2 to Pasadena Blue Line Report to the MTA
Board of Directors from Patricia V McLaughlin, Arthur T. Leahy, and Stanley G. Phernambucq
(Feb. 22, 1996), 960117.
252. According to the cash flow plan, the second source of funds for the project is
$263.1 million of Proposition C 40 Percent Discretionary funds, $60.6 million of which was
already expended in prior years. Although these funds can be used for bus operations, the MTA
previously has used Proposition C 40 Percent Discretionary funds principally as collateral to'
issue bonds for rail construction projects. Pasadena Blue Line Report to the MTA Board of
Directors from Patricia V. McLaughlin, Arthur T. Leahy, and Stanley G. Phernambucq (Feb. 22,
1996), 960117.
253. The Board approved a cash flow plan showing the funds required by source for
each fiscal year. The cash flow plan shows that MTA plans to obtain $387.8 million of the
$803.9 million budgeted from State grant funds, only $88.0 of which has been allocated to date.
Of the allocated funds, $22.9 million has already been expended. One of the assumptions of the
plan was that the State would not reduce its level of financial participation in the project. The
State, however, has decided to delay full payment to MTA of the grant funds from 1997 until
2002, Rubin Decl. fjf 23-29, requiring MTA to “front” the State share and, at a minimum, to pay
finance charges. The State may also delay payment further or reduce its share. Id.; Pasadena
Blue Line Report to the MTA Board o f Directors from Patricia V. McLaughlin, Arthur T. Leahy,
and Stanley G. Phernambucq (Feb. 22, 1996), 960117.
254. The second source of funds for the Pasadena Line is $263.1 million from MTA
Proposition C 40% Discretionary funds, $60.6 million of which was already expended in prior
years, leaving $202.5 million for proposed construction costs. Although these funds can be used
G:\mta\mediate\rg-bliss 79
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
for bus operations, MTA has previously principally used Proposition C 40% Discretionary funds
as debt service on bonds for rail construction projects. In its 20 Year Plan, MTA estimated that
only ten percent of Prop C 40% funds would be used for bus operations or capital while 81
percent would be used for rail. Pasadena Blue Line Report to the MTA Board o f Directors from
Patricia V. McLaughlin, Arthur T. Leahy, and Stanley G. Phernambucq (Feb. 22, 1996), 960117.
255. The third source of funds for the Pasadena Line is $153.0 million in Proposition
C 25% Transit-Related Highway Improvement Funds, $48.7 of which has been expended. MTA
is currently spending little of Prop C 25% funds for specifically enumerated uses such as HOV
lanes or transit ways that would improve bus operations. Instead, MTA has borrowed against the
funds for rail construction, although rail construction is not a specifically enumerated purpose for
these funds. MTA has used a significant portion of the Highway Improvement funds, as noted
above, for debt service for the completion of the Green Line and for Pasadena Line planning.
MTA could use these funds for operating bus lines on or crossing freeways. Id.
4. There Was Strong Dissent At The February 28
Board Meeting Against The Pasadena Blue Line
256. The MTA Board decision to proceed with construction of the Pasadena Blue Line
was not made without hesitation by some Board Members, nor without strong dissent by others.
Excerpts from the transcript of relevant portions of the February 28 Board meeting concerning
the Pasadena Line follow.
MTA Board Member Heit:
[T]he inability of the revenue stream to support the bonding are a
concern of mine and say we get to the, to 2001 and we don't have
the money to pay the bonds where do we get it from?
Transcript o f Board Meeting re Pasadena Line (Feb. 28, 1996) at 1.
Supervisor and MTA Board Member Yaroslovskv:
[W]hat are the contingencies that we have to be concerned about
in connection with this or with any other line. Where is it the
estimates that you've made concerning the cost of the construction
G:\mta\mcdiate\rg-bliss 8 0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
are, sound or not, that all of the other financial assumptions . . .
assume obligations are sound, on other lines, other construction
projects, other operational needs.
I think in this case you have to make an assumption that
you're going to win the bus fare lawsuit and you've made that
assumption in this case. . . .
[M]y primary concern about this is what happens if one of
your assumptions doesn't pan out? What happens if there is
another problem on the red line that requires as we voted on today
a 120, a 130 million dollars worth of additional funds to fix the
sinkhole. What happens if the 800 million dollars turns out to be
1.1 billion dollars on Pasadena for reasons that you can't even
phantom at this point in time.
What happens if you do lose the bus fare lawsuit? What
happens if Congress does reduce the amount of appropriation to
the rail capital program?
Id at 2.
Supervisor and MTA Board Member Yaroslovskv:
The funding mix, this business about the funding mix is a phony
issue because its all, its all the same money, money, money is
being laundered from one fund to the other . . . .
Id at 5.
Supervisor and MTA Board Member Yaroslovskv:
The last thing I want to say is this. . . . This is not just
about rail construction money. This is about all of our
discretionary money. As your memo to me, and I think you
copied every other member of board, expressly points out and I
would like to quote from it, just so that:
G:\mta\mediate\rg-bliss 81
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
If the MTA did not build the Pasadena Blue Line,
Proposition A 35% rail funds could be used to fund
rail operations instead of rail capital. This would
free up Prop C 40% discretionary funds currently
programmed for rail operations which could be
used for other purposes such as bus operations.
I just want to be clear for my own edification. When you
answered her question saying that today's action commits us,
obligates us on these other bonds, these rail bond issues . . . . If it
commits us then we are also committing, we are also
compromising our ability to use, what is it, Prop C 40%
discretionary funds for bus operations, are we? As a practical
matter.
Id. at 9-10.
MTA Official Linda Bohlinger
Now if we do not do the Pasadena Line at all . . . , then you could
free up rail operations money which then could free up
discretionary dollars.
Id. at 9-10.
Supervisor and MTA Board Member Yaroslovsky:
So as a practical matter, I just, let me just ask. Ask the
question, as a practical matter the money that is being committed
today, the, the source of funds that are being committed today,
commit us also or prevent us also from accessing some of the
discretionary dollars for bus operations that we could have
otherwise if we didn't do this project, isn't that right?
Linda Bohlinger:
Correct.
G:\mta\mediate\rg-bliss 82
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Id. at 11.
Supervisor and MTA Board Member Yaroslovskv:
Alright, I, I hope that's, that's clear, because this is not
about one little fund here and one little fund there, as though they
don't operate in tandem with one another. This is a laundering
and I don't mean it in a negative sense. You are using one fund to
do something here which freezes up some other fund to do what
that other fund is also eligible to do, as your memo so aptly points
out, and make no mistake about it. . . . The commitment to do
this has a direct impact on bus operations and anybody who thinks
and anybody who says that we can do this and improve the bus
operations is smoking some good stuff, its just not there.
Id. at 12.
MTA Board Member Dewidsiak:
My concerns are to vote widi what we can afford, and,
basically I'm not really sure that, I'm not really sure that the,
UCLA forecast which what is . . . this is all based upon, with a 5
percent growth in our, Prop C and Prop A monies is a realistic
forecast, and I'll, I will refer you to this week's edition of
Businessweek magazine which charts the economic growth over
the last 40 years and there is no 5 year period with an average, 5
percent growth. I, I envision a shortfall right from the get go.
Id. at 15. "I don't think this agency has a history of bringing in anything under 10% of cost
overruns." Id. at 16. "[Y]ou shouldn't give me an overly optimistic, rosy picture that, that
pushes this and that everything is wonderful." Id.
5. MTA’s Plan To Issue Bonds To
Finance The Pasadena Line
257. MTA plans to issue a series of bonds to raise funds for the construction of the
G:\mta\mcdiate\rg-bliss 83
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Pasadena Line. MTA anticipates that over half of the current budgeted cost of the Pasadena Line
will come from bonding that uses future Proposition C 40% Discretionary and 25% Transit
Related Highway tax revenues for debt service. The annual debt service required for
construction of the Pasadena Line is $22.6 million annually for 30 years. Rubin Decl. f 10, f f
19-22.
258. A conservative estimate of annualized and one-time cost of continuing work on
the Pasadena Line to be paid out of funds that could be utilized for bus operations or
improvements over the next 30 years is $1.2 billion dollars. Rubin Decl. ffl 10-12 (including
debt service, the cost of fronting State grant funds, the cost of rail cars and operating subsidy).
For the same amount of money, the MTA could provide bus service to almost three times as
many riders as the Pasadena Line would serve. Rubin Decl. UH 14-17. Moreover, because the
great majority of Pasadena Line passengers are likely to be former bus passengers, MTA will
effectively convert many bus trips into Pasadena Line trips that coast three times as much,
risking service reductions. Id.
259. Halting expenditures on the Pasadena Line will preserve the last significant,
available funds that exist for relief in the instant action on behalf of MTA bus riders. MTA and
its predecessor, the LACTC, have already largely “used up” the existing Proposition A 35% Rail
Construction and Operations revenues, committting most of these funds for decades to come to
cover past borrowings, leaving very little for subsidizing additional rail construction or for paying
the ongoing operating and captial renewal and replacement costs of operating rail lines. MTA
has also committed a large portion of Proposition C 25% Transit-Related Highway Improvement
funds, shifting funding from projects such as high occupancy vehicle lanes and freeway
extensions to backfilling overpromised financing to pay for the completion of the Green Line and
starting the Pasadena Line. Finally, MTA has already made massive commitments of the last
available major funding source, Proposition C 40% Discretionary funding, tying up large
segments of these funds for three decades into the future to support rail construction and to
operate urban rail systems. If action is not taken soon to prevent MTA from continuing with its
past practices, such a large portion of the funding from these three funding sources listed above
G:\mta\mediatc\rg-bliss 84
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
will be committed for rail construction projects and rail operations that the amounts available for
other purposes, particularly bus operations and capital, will be reduced to the point of
insignificance. Rubin Decl. f 9. “Forcing a halt to Pasadena Line spending will preserve
Proposition C 40% Discretionary and 25% Transit Related Highway Improvement funds for
other, more productive purposes for the greater benefit of all Los Angeles County residents,
taxpayers, and transit users, but particularly minority members of these groups. Any other action
will allow continued 30-year commitments of this last hope for real improvement in the Los
Angeles transit system to non-productive rail construction and operating expenditures.” Id.
260. Once funds are obtained from bond issuance, they will be further committed when
MTA enters into construction contracts. At the present time, MTA has not entered into many
major contractual commitments for Pasadena Blue Line construction purposes and, therefore,
delaying construction of it would have relatively minor negative cost impact if a decision was
later made to allow construction to proceed. Conversely, allowing construction to proceed at this
point would result in major, non-recoverable commitments to construction that would have no
benefit if construction were later to be cancelled. Depending on the exact timing of such a future
decision to cancel construction of the Pasadena Line, such non-recoverable expenditures could
run into the hundreds of millions of dollars. If these scarce funds are expended on construction
of the Pasadena Line, then they will not be available to assist in the resolution of the current
lawsuit in favor of the plaintiff. Rubin Decl. f 4.
6 . Issuing Bonds For The Pasadena Line Will Cause
MTA To Exceed Restrictions On Its Debt Load
261. In 1995, an MTA consultant calculated MTA’s existing annual debt service for
fiscal year 1995-96 as $226.5 million and exceeding $250 million in 2003-04. MTA, Public
Financial Management, Inc., Outstanding Debt Analysis (Aug. 15, 1995). MTA’s annual debt
service is not scheduled to fall below $200 million until 2011-12 and below $196 million in
2021-22. Id. See also MTA, Public Finacial Management, Inc., Debt Management Schedule
(Feb. 3, 1995) M301984. The following chart entitled “Stacked Debt Landscape” illustrates the
mountain of MTA’s debt service load. MTA, Investor Presentation (June 1996), M821158,
G:\mta\mcdiate\rg-bliss 85
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Issuance of further bonds for the Pasadena Line will increase MTA’s debt service obligations by
$22.6 million for 30 years.
262. MTA Board member and County Supervisor Zev Yaroslavsky has stated that
MTA will reach its bonding limit if it tries to finish the Pasadena project, leaving MTA without
funds to improve bus service: “I think the MTA staff has to demonstrate to the board and the
public how it can improve the bus system and exhaust its bonding capacity, as it will do with
Pasadena.” According to Supervisor Yaroslavsky, “I just don’t see how you can do it.”
Boyarsky, Satisfying 2 Powerful Politicians a Tough Challenge for MTA Chief Los Angeles
Times, February 23, 1996, B-l at B-6.
263. Proposition 192, the Seismic Retrofit Bond Act, was passed in 1996 to require
that State funds could not be programmed to mass transit guideways in Los Angeles County until
a finding that MTA “has adopted a specfic plan that the agency can reduce its debt, achieve
solvency, and restore affordable bus service for the transit-dependent population.” Rubin Decl. at
21. Proposition 192 adopts a State policy requiring that MTA reduce its debt, a policy MTA will
violate if it issues bonds for the Pasadena Line and incurs further debt. Id. at ffl 45-47.
Construction of the Pasadena Line will also operate against the State policy of requiring MTA
to“restore affordable service for the transit-dependent.” See generally MTA, Briefing For
California Transportation Commission re Prop 192 (Apr. 30, 1996).
7. The Development Of The Pasadena
Line Is Replete With Irregularities
264. In June and July, 1993, the MTA Board rejected as unworkable various financing
options for the Pasadena Line, including federalizing the Pasadena Line. Nevertheless, the MTA
Board voted on August 25, 1993, to proceed with the Pasadena Line in an amount not to exceed
$97 million for FY 1993-94 to complete final design, to proceed with utility relocation, to
proceed with the Los Angeles River Bridge, and to complete the acquisition of properties for
approved stations. The Board also voted to identify "alternative funding sources" of $57 million
for the Pasadena Line. MTA, Tom Rubin, Discussion of "Special Work Program — Pasadena
Line Budget — Funding from FY 93-94 Work Program" and "Alternative Approaches to $57M
G:\mta\metliatc\rg-bliss 87
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
for Pasadena Line” (Oct. 20, 1994), 011340.
265. The initial published budget for the Pasadena Line was $841 million, not
including costs of rail cars, capitalized interest and unallocated common rail construction. The
$97 million allocated in August 1993 was on top of millions allocated in previous years. Id.
266. On September 15, 1993, MTA staff identified three sources for the $57 million:
$30 million from TOS/Proposition C 25% funds from previously-approved highway improvement
projects, $20 million from allocation of previously committed California State rail bond funds
that could be committed only upon submission of a full funding plan from the Pasadena line, and
$7 million in a loan from the City of Pasadena. The staff presentation stated that the only
alternatives considered were various funding alternatives and that "[n]o consideration was given
to 'no-build' or multi-year funding alternatives." Id. at 011342-43.
261. On July 20, 1994, a week after approving the fare restructuring, the MTA Board
voted to transfer $32.8 million of unexpended funds from highway HOV projects to the Pasadena
Line. CEO Franklin White unsuccessfully opposed the use of HOV funds as "dangerous" and
"spend[ing] money we didn t have." MTA Board minutes state:
CEO Franklin White attempted to explain that the HOV funds
cover projects to be accomplished over the next 30 years, not just
a few months. He said these funds should not be removed from
HOV into Rail Construction. It is important to maintain this
account because we are at the beginning of these projects and even
if one is under budget, another could be over. It is dangerous to
remove funds this early in the program, it could result in some
projects not happening due to a lack of dollars. The HOV projects
are among the best producers of congestion relief, which is the
goal of the 30 year plan. Mr. White also expressed concern that
allocating the $60.8 million would be a commitment to embark on
laying rail and there is no assurance there will be funds next year.
★ * *
G:\mta\mcdiate\rg-bliss 8 8
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
CEO Franklin White said we were on the edge of repeating what
happened on the Green Line, proceeding too far without assurance
there was enough money. If we move money from HOV projects,
it will change the 30 year plan. There is no way to know when
additional dollars will be available. HOV gives more to relieve
congestion than rail. He asked the Board not to spend money we
didn't have.
Minutes of MlA Regular Board Meeting (July 20, 1994), 951724 at 95 1 726-28.
268. MTA staff failed to evaluate for the Board the fiscal impact of the Pasadena Line
extension on the MTA budget and bus operations. Shortly after the Pasadena Line vote, MTA
staff made available deficit models which revealed that approval of the line would contribute to a
budget deficit while disapproval would have largely avoided the deficit. Testimony o f Antonio
Villaraigosa; Testimony of Thomas Rubin.
F. MTA Has Spent Hundreds Of Millions Of Dollars
On Metrolink, A Commuter Rail System That Provides
Superior Service To An Overwhelmingly White Ridership
269. Prior to the existence of the regional commuter rail system now known as
Metrolink or the Southern California Regional Rail Authority (“SCRRA”), the LACTC during the
late 1980s began to plan a regional five-county commuter rail system. MTA Admission No. 63
(admitted).
270. The Metrolink commuter rail system is a five-county network of rail services.
The member agencies of Metrolink/SCRRA are MTA, the Orange County Transportation
Authority, the Riverside Transportation Commission, the San Bernardino Associated Government,
and the Ventura County Transportation Commission. Amended Pretrial Conference Order at 6
(Jan. 4, 1996).
1. The Metrolink Ridership Is Quite Small,
Financially Well-Off And Non-Transit-
Dependent. And Overwhelmingly White
271. During FY 1994-95, Metrolink averaged approximately 16,400 daily inbound and
outbound daily boardings. MTA Admission No. 65 (admitted). The lowest number of average-
G:\mta\mediate\rg-bliss 89
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
daily-boardings per month during that fiscal year was 15,136 in August 1994; the highest
number was 18,090 in March 1995. Since most Metrolink patrons are roundtrip commuters, the
number of daily inbound and outbound boardings is approximately double the number of people
who use Metrolink each day. As the MTA staff advised the MTA Board in 1995: "Metrolink
currently serves about 17,000 daily boardings, or approximately 8,500 riders." Metrolink
Performance Summaries for the Month o f May, 1995, at 2 (undated), M332571 at M332572;
Ridership Report, at 3 (Sept. 1995), M804716 at M804720; Supplement to SCRRA Report, at 2
(Feb. 3, 1995), M335870 at M335871.
272. The typical Metrolink passenger tends to be a professional worker, with a
household income of approximately $60,000 to $65,000, and with access to a car. MTA
Admission No. 66 (admitted).
273. A large majority of all Metrolink passengers are white. Of Metrolink passengers
identifying their race or ethnicity during a 1993 survey, 72 percent were white. Metrolink Rider
Survey (April, 1993), M801073 at M801076-77; see also MTA's Relationship with the SCRRA,
at 11 (Jan. 25, 1995), M323405 at M323415. On the only Metrolink line operating entirely
within Los Angeles County — the Santa Clarita Line — 78 percent of the Metrolink passengers
identifying their race or ethnicity were white. Id. On the Ventura Line — most of which is
within Los Angeles County — 80 percent of the Metrolink passengers per a 1994 on-board
survey responded that they were white/Caucasian. MTA Admission No. 67 (admitted).
2. Metrolink Passengers Receive High Quality Service
274. Metrolink provides quality service to its passengers, particularly vis-a-vis the bus
service provided by the MTA to its bus riders. Each of the Metrolink double-decked passenger
coaches has soft-cushion seating, a restroom, a bicycle rack, a water fountain, counters for laptop
computers, and a cellular phone. MTA Admission No. 68 (admitting in part that "each Metrolink
passenger car is double-decked, has padded seats, a restroom, a water fountain and counters").
275. Metrolink "Ambassadors," part-time employees, work at Metrolink Stations in the
morning to help passengers with ticketing, to answer questions, and to convey messages; the
Ambassadors provide the same assistance in the afternoon at Union Station. Metrolink/SCRRA
G:\mta\mcdiatcV‘g-bliss 90
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Annual Financial Report For The Fiscal Year Ending June 30, 1992, at iv (Dec. 28, 1992),
M332577-A at M332600-A; Metro Moves (May, 1993), 000200 at 000201; Dep. o f Richard
Stanger, at 158-59 (Sept. 26, 1995) (Vol. 2).
276. Unlike the MTA, which tried to eliminate monthly passes for MTA bus riders,
Metrolink encourages the use of discounted monthly passes. As stated by MTA official and
Metrolink Executive Director Richard Stanger in a sworn Declaration submitted in this case in
the fall of 1994: "The Metrolink fare structure encourages the purchase of monthly or 10-trip
passes." Dec. o f Richard Stanger, at 6, f l9 (Sept. 20, 1994). Asked about why fares should be
structured to encourage the use of discounted monthly passes, Mr. Stanger replied in sworn
testimony: "We do that to encourage the habit of commuting. Any — I imagine most
businesses, if you buy a lot at one time, you get a quantity discount. So we're doing nothing
more than what I think ordinary business would do, anyway." Dep. o f Richard Stanger, a t-147-
48 (Sept. 26, 1995) (Vol. 2); MTA Admission No. 69 (admitted that "the quoted deposition
testimony of Richard Stanger speaks for itself").
211. Metrolink sells its monthly passes through the mail and over the phone for
purposes of rider convenience, and it also allows its riders to purchase monthly passes and other
fare media through the use of a credit card. MTA staff reported to the MTA Board in 1995 that
"[t]wo-thirds of Metrolink riders purchase monthly passes." Dep. o f Richard Stanger, at 147,
181, 209-10 (Sept. 26, 1995) (Vol.2); MTA's Relationship with the SCRRA, at 13 (Jan. 25,
1995), M323405 at M323417.
278. Metrolink passengers who use monthly passes or round-trip tickets need not pay a
separate fare or even buy a transfer in order to board an MTA bus, a municipal bus, the Red
Line, and even the Blue Line (for transit stops close to downtown Los Angeles) on their way to
and from a Metrolink Station. All that the Metrolink passengers need to do is to show their
Metrolink fare media when they board adjacent public transit, and they then ride for free. MTA
Admission No. 70 (admitted in substance).
3. MTA Has Paid Hundreds Of Millions Of
Dollars To Build And To Operate Metrolink
G:\mta\mediate\rg-bliss 91
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
279. MTA (LACTC) negotiated with the Southern Pacific and Santa Fe railroads for
the acquisition of the rail rights-of-way necessary for such a commuter rail system. MTA
Admission No. 64 (admitted). The rights-of-way for the commuter rail system and for other
purposes were acquired not by Metrolink but by the respective countywide transit agencies. Of
the approximately $1 billion paid for the rights-of-way, MTA (LACTC) paid approximately $600
million, more than was paid by the other four countywide transit agencies combined. Dep. of
Richard Stanger, at 117 (July 27, 1995) (Vol. 1); Metrolink/SCRRA Annual Financial Report
For The Fiscal Year Ended June 30, 1992 (Dec. 28, 1992), M332577-A.
280. During Metrolink's first fiscal year, FY 1991-92, MTA (LACTC) paid nearly
three-quarters of Metrolink's capital expenses: $147.6 million out of a total of $204.8 million.
MTA Admission No. 71 (admitted "that in FY 1991-92, the LACTC contributed $147.6 million to
Metrolink's total capital budget o f $204.8 million").
281. As to the MTA's initial improvement of the rail lines and its contribution to the
purchase of 23 locomotives (at $2.2 million each) and 94 passenger coaches (at $1.37 million
each), Metrolink reported in 1993 that the MTA had spent $388 million not including its
purchase of rail rights-of-way. Exh. 3 to Dec. o f Richard Stanger (Sept. 20, 1994); Metrolink/
SCRRA Annual Financial Report For The Fiscal Year Ending June 30, 1992, at iv (Dec. 28,
1992), M332577-A at M332600-A; Metrolink/SCRRA Final Budget Fiscal Year 1993-94,
Appendix A, at Chart 4 (Sept., 1993), 957221 at 957327.
282. As to operating expenses during Metrolink's first fiscal year, FY 1991-92, and for
every year thereafter, MTA has paid more than 60 percent of Metrolink's operating expenses.
MTA Admission No. 72 (admitted).
Ill
III
III
III
III
III
G:\mta\mcdiate\rg-bliss 92
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
283. With regard to the Metrolink/SCRRA budget for FY 1994-95, MTA's
contributions to Metrolink/SCRRA were as follows:
$ 27,580,100 Operating Subsidy
$ 5,256,200 Maintenance of Way
$ 36,975,000 Capital Improvements
$ 2.500,000 Reserve for the Expanded Santa Clarita Line
$ 72,311,300 Total MTA Contribution to Metrolink
Authorization o f LAC MTA Share of FY 1994-95 SCRRA Budget (May 2, 1994), M0230134; MTA
Admission No. 73 (admitting "that in its 1994-95 budget, MTA contributed $76.0 million to
SCRRA").
284. Although the foregoing MTA contribution to Metrolink for FY 1994-95 was
higher than normal due to increased capital and operating expenses within Los Angeles County
following the Northridge earthquake, MTA's contribution for FY 1994-95 was less than MTA's
amended contribution of $98 million to Metrolink for FY 1993-94. MTA Admission No. 74
(admitting that "MTA's total contribution to the SCRRA budget for Fiscal Year 1994-95 was less
than the MTA's amended contribution of $98 million to the SCRRA budget for Fiscal Year 1993-
94"); Memo from Richard Stanger to the MTA Finance, Budget, & Efficiency Committee, at 2
(Jan. 21, 1994) (revised Jan. 25, 1994), M322539 at M322540; Minutes o f the MTA Regular
Board Meeting, at 5 (Jan. 26, 1994), M901902 at M901906.
285. Metrolink passengers receive the highest subsidies of all riders of public transit in
Los Angeles County. As calculated by the MTA in 1994, Metrolink passengers in 1992 received
a total subsidy per boarding of $21.02, and a total subsidy per passenger mile of $1.25. For FY
1992, apart from the maintenance-of-way costs and also putting to one side the hundreds of
millions of dollars spent on acquiring the rights-of-way, when the MTA combined merely the
annual capital subsidy with the annual operating subsidy for Metrolink, the MTA reported that
"the total subsidy per passenger becomes $34.45 — this compares with the total subsidy per
passenger of $1.17 for the average SCRTD bus rider in FY92 and $.34 for the subsidy on the
most cost-effective bus line, the 204 (Vermont)." MTA, A Look At The MTA (Jan. 1994),
G:\mta\mediate\rg-bliss 93
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
800042A at 800071A-74A; MTA, Metrolink Costs, at 8 (April 24, 1993), 011067 at 011074.
286. Metrolink riders also receive a high subsidy for the security provided by
Metrolink, which is not all of the security provided to Metrolink. As calculated by the MTA in
1994, each passenger boarding Metrolink receives $1.29 of personal security per boarding for the
security provided by Metrolink, while MTA bus riders receive only 3c of security per boarding.
MTA, A Look At The MTA (Jan. 1994), 800042A at 800093A-95A.
287. The security provided by Metrolink includes only the on-board security contracted
out to the Los Angeles County Sheriffs Department at more than $2 million per year, and the
layover facility security contracted out to a private security service at approximately $1.3 million
per year, but it does not include: first, the security necessary to protect the Metrolink rights-of-
way, which is paid for by the counties or their transit agencies (for the three fiscal years ending
on June 30, 1995, MTA paid approximately $3,928,905 for this security); or, second, the -
security at Metrolink Stations, which is provided by the jurisdictions that own and operate the
various Metrolink Stations and/or by their police or sheriffs departments. Dep. o f Richard
Stanger at 197-98, 247-49 (Sept. 26, 1995) (Vol.2); Evaluation Criteria for Contract No. MS056
Law Enforcement Services (Feb. 3, 1995), M332895, attached to Metrolink/SCRRA Agenda (Feb.
10, 1995), M332857; A Descriptive Study of Transit Policing Systems Within Los Angeles
County, at 6 (Jan. 19, 1993), D112144 at D112150.
288. As to the Metrolink on-board security provided under contract with the Los
Angeles Sheriffs Department (LASD), the Metrolink/SCRRA Board in the spring of 1995
considered but rejected a less expensive proposal for that security presented by the MTA Transit
Police. In part because the MTA Transit Police proposal was half-a-million dollars less over
three years than the proposal by the LASD, MTA staff recommended a contract with the MTA
Transit Police. At the Metrolink/SCRRA Board meeting on April 21, 1995, Metrolink Executive
Director Richard Stanger explained to the Board that the MTA Transit Police proposal not only
had "a lower price" but also promised "33 patrol officers compared with 23 deputies in the
Sheriffs proposal." The Metrolink/SCRRA Board rejected the staff recommendation and
unanimously agreed to award the three-year contract to the LASD at the higher amount of
G:\mta\metliate\rg-bliss 94
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
$7,859,623, plus a 10 percent contingency reserve, for a possible total amount of $8,645,585.
Evaluation Criteria for Contract No. MS056 Law Enforcement Services (Feb. 3, 1995),
M332895, attached to Metrolink/SCRRA Agenda (Feb. 10, 1995), M332857; Recommendation
for Contract Award Contract No. MS056 Law Enforcement Services (April 14, 1995), M332762,
attached to Agenda for Continued Metrolink/SCRRA Board Meeting (April 21, 1995), M332758;
Minutes o f SCRRA Continued Board Meeting (April 21, 1995), M332674, attached to Agenda for
Metrolink/SCRRA Board Meeting (May 12, 1995), M332637.
4. The Metrolink Ridership Receives Millions Of
Dollars Of Additional Subsidies And Benefits
Nowhere Set Forth In The Metrolink/SCRRA Budgets
a. Metrolink Stations Are Not Owned Or
Operated By Metrolink, But Primarily By
The Local Jurisdictions Served Bv Metrolink
289. The Metrolink ridership receives millions of dollars of additional public subsidies
and benefits nowhere set forth in the Metrolink budgets, nor used to calculate what would be
even higher per-passenger subsidies on Metrolink. Metrolink Stations, for example, are not the
responsibility of Metrolink, but instead, as stated in Metrolink budgets, the Metrolink Stations are
"[c]onsidered off-budget" as they are built, owned, operated, and maintained (including the
provision of police security) by the local jurisdictions being served, usually the cities but
occasionally Los Angeles County. MTA Admission No. 79 (admitted that “Metrolink stations are
built, owned, operated, and maintained by the local jurisdictions being served by them");
Metrolink/SCRRA Preliminary Budget Fiscal Year 1994/95, at Capital Budget, Ul-l (May 17,
1994), 957420A at 957466; A Descriptive Study of Transit Policing Systems Within Los Angeles
County, at 6 (Jan. 19, 1993), D112144 at D112150; Dep. o f Richard Stanger, at 192, 284-86
(Sept. 26, 1995) (Vol. 2).
290. As an MTA official admitted on behalf of the MTA in deposition testimony, this
local ownership of the Metrolink Stations was dictated by the MTA, which also has a minority
ownership in some of the stations:
It was the MTA's policy that the cities would be responsible for
constructing the individual commuter rail stations. And there were
G:\mta\mediate\rg-bliss 95
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
some specific instances where agreements were negotiated between
the MTA and individual cities whereby the MTA would contribute
some portion of the cost, and in doing so, acquire the minority
ownership in the station.
Dep. o f Dana Woodbury, at 44 (July 21, 1995) (Vol. 1); MTA Admission No. 80 (admitted that
"the quoted deposition testimony o f Dana Woodbury speaks for itself).
291. Although Metrolink recognizes that constructing a Metrolink Station can cost
millions of dollars — construction of the Norwalk/Santa Fe Springs Metrolink Station and
Transportation Center cost approximately $5,388,836 — Metrolink has been able to acknowledge,
with regard to a $5 million expenditure such as this, that “this project had no impact on the
SCRRA budget." MTA Admission No. 81 (admitted in substance).
292. Although Metrolink thus has not been financially responsible for the Metrolink
Stations, another agency, MTA, has played a role in approving the financing of Metrolink Station
planning, construction, operations, maintenance, and security, a role which it has played in part
through its administration and approval of all spending of Proposition A and Proposition C Local
Return funds. Through its authority and control, MTA has approved the expenditure by local
jurisdictions of tens of millions of dollars on Metrolink Stations and adjacent facilities. MTA
Admission No. 82 (admitted that the "MTA administers the Proposition A and C Local Return
Program and that through this program local jurisdictions have funded the construction of
Metrolink Stations"); Dep. o f Patricia McLaughlin, at 139, 239-75 (Sept. 6, 1995) (Vol. 2);
Proposition A Local Return Program FY 1991-92, at 8-9, 13-14 (Aug. 26, 1992), D116296 at
D116303-04, D116308-09; Proposition A (25%) and Proposition C (20%) Local Return
Program Approved Projects Report FY 1992-93, at 2-30 (July 26, 1993), D116109 at D116110-
38.
293. For example, during FY 1991-92, when the construction of Metrolink Stations
was just beginning, MTA (LACTC) approved the expenditure of $7,362,664 on Metrolink
Stations and adjacent facilities, as follows: $50,000 by Baldwin Park; $827,132 by Claremont;
$614,000 by Covina; $1,081,000 by El Monte; $192,664 by Glendale; $5,250,000 by the City
G:\mta\mediate\rg-bliss 96
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
of Los Angeles (for the Chatsworth Metrolink Station); $175,000 by Norwalk; and $50,000 by
Pomona. Proposition A Local Return Program FY 1991-92, at 8-9, 13-14 (Aug. 26, 1992),
D116296 at D116303-04, D116308-09.
294. During the following fiscal year, FY 1992-93, when some of the big bills were
due and when Proposition C Local Return funds became available, MTA approved the
expenditure of $24,701,257 on Metrolink Stations and adjacent facilities, as follows:
Exnenditure Jurisdiction
$1,503,060 Baldwin Park,
$1,815,170 Burbank,
$ 788,309 Claremont,
$ 973,003 Covina,
$ 603,068 El Monte,
$4,293,932 Glendale (plus $1,443,900 for a commuter rail shuttle),
$ 60,000 Lancaster,
$2,054,000 Los Angeles (for the Chatsworth Metrolink Station and
Child Care Facility),
$2,833,334 Los Angeles (for the Sylmar/San Fernando Metrolink
Station),
$2,737,000 Los Angeles (for the Van Nuys Metrolink Station),
$3,000,000 Los Angeles (for Union Station),
$1,181,855 Norwalk,
$1,234,500 Pomona,
$1,524,020 Santa Clarita,
$ 100,000 West Covina (plus $35,000 for a Metrolink shuttle).
Proposition A (25%) and Proposition C (20%) Local Return Program Approved Projects Report
FY 1992-93, at 2-30 (July 26, 1993), D116109 at D116110-38; MTA Admission No. 84
(admitting higher "total costs" for most o f the foregoing Metrolink Stations, e.g.. "$19,690
million" for the "Chatsworth Metrolink station and child care facility, land purchase and
G:\mla\mediate\rg-bliss 97
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
roadway").
295. In subsequent years, the MTA approved tens of millions of dollars of additional
Local Return spending on Metrolink Stations and adjacent facilities, initially again mostly on
construction, and thereafter increasingly on operations, maintenance, insurance, and security.
Memo to Pat McLaughlin re: FY-94 Proposition A and FY94-FY96 Proposition C Local Return
Approved Projects Report (July 22, 1994), D116238, and attached Reports at 1-31, 1-26 (July
21, 1994), D116239-95; Memo to Pat McLaughlin re: FY-95 Proposition A and Proposition C
Local Return Approved Projects Report (Feb. 2, 1995), Dl 16314, and attached Reports at 1-31,
1-37 (Feb. 1, 1995), Dl 16315-72.
296. Even prior to the availability of Proposition C Local Return funds for MTA-
approved local expenditures on the purchase and renovation of Metrolink Stations, MTA
(LACTC) cited the "Commuter Rail stations" as among the "most notable projects" funded by
MTA-approved Proposition A Local Return funds. Memo from Neil Peterson re Review of
Proposition A Local Return Policies, at 2 (Nov. 6, 1990), M1041440 at M1041441.
b. MTA Has Expended Millions Of Dollars
To Reroute Buses, To Create New Bus
Feeder Systems, And Otherwise To Make
Commuting Easy For Metrolink Passengers
297. Metrolink passengers also have benefited from the MTA's expenditure of millions
of dollars to reroute bus lines to serve Metrolink Stations, to create new bus feeder routes to
serve Metrolink stations, and to upgrade the bus-rail interface at Union Station. As to the latter,
an MTA official stated in deposition testimony that the purpose was "to establish bus service to
specifically meet the needs of commuter rail patrons arriving at Union Station." Dep. o f Dana
Woodbury, at 49 (July 21, 1995) (Vol. 1). See also MTA Admission No. 85 (admitted "that MTA
did reroute bus lines to serve Metrolink stations," and "that MTA improved bus rail interface at
Union Station"); Union Station Bus/Rail Interface Update (Sept. 8, 1992), M330881; Metrolink
Bus Plaza Charges, at 2 (Sept. 18, 1992), M330887 at M330888.
298. The bus-rail interface at Union Station involved not just an initial grant of
$645,000 to LADOT to provide a new DASH Downtown feeder line, but also the construction at
G:\mtaVnediate\rg-bliss 98
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Union Station of a new Metrolink Bus Plaza, sometimes also referred to as the Upper Level
Terminal:
[A] special terminal was constructed known more commonly as
the Upper Level Terminal at the Union Station, which would be
served by bus lines identified by the various carriers operating in
the area, specifically to facilitate the transfer between Metrolink
patrons and those connecting bus services.
The construction of this Metrolink Bus Plaza cost MTA at least $1,240,000. Union Station
Bus/Rail Interface Update (Sept. 8, 1992), M33088I; Dep. o f Dana Woodbury, at 51, 55, 60
(July 21, 1995) (Vol. 1); Metrolink Bus Plaza Charges, at 2 (Sept. 18, 1992), M330887 at
M330888; MTA Admission No. 86 (admitted "that LADOT received a $645,000 grant to provide
new feeder service to Union Station").
299. In planning the rerouted and new bus service in downtown Los Angeles,
Metrolink and MTA. (LACTC) agreed that "there should be minimal overlap with the Red Line
service" due to begin in 1993, as there was "a real possibility otherwise of making the bus
service so attractive it diverts people away from the Red Line." Memo from Richard Stanger to
Judy Wilson re: Distribution of Bus Service at Union Station (April 27, 1992), M330780.
c. Thanks To MTA Funding, Some Metrolink
Passengers Receive Free Transportation
From Metrolink Stations To Their Places
Of Employment, And Some Passengers
Receive Subsidized Child Care Too______
300. Metrolink passengers also have benefitted from MTA's expenditure of funds for
free bus shuttles from Metrolink Stations to the passengers' places of work and back. For
example, to facilitate commuting to and from the Chatsworth Metrolink Station — in Chatsworth,
in Los Angeles County, on the Metrolink Ventura Line — MTA helped to create and initially
fully funded the "12th Council District TMA Flat-Fare Taxi Shuttle," a free shuttle service based
at the Chatsworth Metrolink Station. This free shuttle service was described in a 1993
report/study by an MTA consultant as follows:
The service is designed to take employees to and from worksites
G:\mta\mcdiate\rg-bliss 99
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
in the Chatsworth area, connecting with the Chatsworth Metrolink
Station. The system is designed to serve employers with 100 or
more employees in the following communities, a roughly 5 mile
radius from the Chatsworth Metrolink Station: Chatsworth,
Canoga Park, Granada Hills, West Hills, Northridge, Winnetka,
Woodland Hills.
* * *
Contrary to the service name, no fare is charged. . . . The project
started with an annual budget of $76,000 and was increased to
$184,000 to meet the demand for service. All funding is provided
by an LAMTA (LACTC) grant to the MTA.
San Fernando Valley Transit Restructuring Study, Task 2.2 Service Assessment, at 8 (Oct., ’1993),
D110020 at D110028; Dep. o f Jon Hillmer, at 107-09 (Aug. 11, 1995); MTA Admission No. 87
(admitted that "MTA has awarded funding to projects that provide free transportation from
transit centers to work places such as the 12th Council District MTA Flat-Fare Shuttle that
circulates employees between the Chatsworth Metrolink Station and local job sites").
301. MTA (LACTC) similarly provided $152,000 in funding to the Burbank Media
District Shuttle, a shuttle service providing workplace transit connections for Metrolink
passengers between the Burbank Metrolink Station and their places of employment in the
Burbank Media District. MTA Admission No. 88 (admitted).
302. MTA also has paid millions of dollars to construct and to support child-care
facilities at Metrolink Stations, child-care facilities which have a priority for the children of
Metrolink passengers first, the children of bus riders second. For example, the MTA Board in
the summer of 1995 authorized the expenditure of nearly $1 million (actually $935,000) for the
construction of a child-care facility at the Sylmar/San Fernando Valley Metrolink Station on the
Metrolink Santa Clarita Line. MTA Admission No. 89 (admitted that "MTA in summer 1995
approved award o f a contract for $935,000 for the construction of a child-care facility located at
the Sylmar/San Fernando Metrolink Station, which is located on Metrolink's Santa Clarita
G:\mta\mcdiate\rg-bliss 100
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Line"); MTA Operations Committee Recommendation (June 14, 1995), M322690; Dep. of
Richard Stanger, at 258-59 (Sept. 26, 1995) (Vol. 2).
303. On February 22, 1995, the MTA Board authorized the expenditure of $1,395,000
for the construction of a child care facility at the Chatsworth Metrolink Station on the Metrolink
Ventura Line. The MTA Board thereafter agreed to pay "$56,000 to supply both centers with
appliances, play-yard equipment, and indoor furnishings . . . to ensure . . . a quality operation . .
. for new child care centers." MTA Admission No. 90 (admitted that "on February 22, 1995, the
MTA Board approved the award of a $1,395,000 fixed-price contract for the construction of the
Chatsworth Station Depot and Child Care Center"); Minutes o f MTA Regular Board Meeting, at
12 (Feb. 22, 1995), M902235 at M902246; Planning and Programming Committee
Recommendation (June 14, 1995), M322756 at M322757.
304. The use of these Metrolink Station child-care facilities was not intended to serve
everyone on a first-come-first-served basis, or even to serve all transit-related parents and
children on a first-come-first-served basis. Instead, as stated by MTA, the child-care facility at
the Sylmar/San Fernando Valley Metrolink Station was specifically intended to serve the children
of Metrolink passengers first, and the children of bus riders second:
To ensure that Metrolink patrons and other mass transit users have
access to the facility, a priority system for filling child care spaces
would be established: priority would be given to children whose
parents commuted via Metrolink commuter rail either to or from
the station site, followed by children whose parents commute via
bus or other forms of mass transit.
MTA Environmental Initial Study, Sylmar/San Fernando Metrolink Station Child Care Center,
Findings, at 3 (undated), M338960 at M338962, attached to Planning and Programming
Committee Recommendation re Sylmar/San Fernando Station Child Care Center (Dec. 15, 1994),
M338930; MTA Admission No. 91 (admitted that the quoted document "speaks for itself").
d. Through Its "Call For Projects," MTA Spends
Millions Of Dollars On Transit Projects Which
Enhance Metrolink's Commuter Rail Service
G:\mta\mediate\rg-bliss 101
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
305. MTA, through its 1995 Call for Projects, awarded approximately $9 million to
transit projects which benefited or enhanced Metrolink, its image, and/or its commuter rail
services. Among the transit projects funded by MTA were proposed projects to provide
additional security at the Metrolink Stations in Burbank, Claremont, Norwalk/Santa Fe Springs,
Pomona, and Vincent Grade/Acton. MTA Admission No. 92 (admitted that "MTA awarded funds
under the Transit Security modal category o f the 1995 Call-for-Projects for: the Burbank
Regional Intermodal Transportation Center, the City o f Claremont Watchful Eyes Depot Security
Project, the Norwalk/Santa Fe Springs Transportation Center, the Pomona Regional Transit
Center Security System Project, and the Acton Park-and-Ride Lot"); Transportation
Improvement Program (TIP) Call for Projects Staff Recommendations, at 35-76 (May 16, 1995),
M322807 at M322841-82; Dep. o f Richard Stanger, at 263-74 (Sept. 26, 1995) (Vol. 2); Dep.
o f Bob Cashin, at 67-70 (Oct. 2, 1995).
e. Most Metrolink Passengers Receive Large
Transit Subsidies From Their Employers
306. Apart from the public subsidies received by Metrolink passengers, many
Metrolink passengers also receive transit subsidies from their employers: Metrolink Executive
Director Richard Stanger testified in his deposition, Metrolink surveys have shown that "about
half of the Metrolink riders are subsidized by their employers" at "an average of $56" per month.
Dep. o f Richard Stanger, at 148-49 (Sept. 26, 1995) (Vol. 2); MTA Admission No. 100 (admitted
that "the quoted deposition testimony of Richard Stanger speaks for itself).
5. Through The MTA/Metrolink Extension Of
Rail Service Another 45 Miles To Lancaster,
MTA Spent -- And Continues To Spend —
Millions Of Additional Dollars On Metrolink
307. Metrolink's Santa Clarita Line was extended 45 miles to Palmdale and Lancaster
on January 24, 1994, following the January 17, 1994 Northridge earthquake. MTA Admission
No. 93 (admitted). Because this extension of the Santa Clarita Line, which more than doubled its
length, was entirely within Los Angeles County, and because the tens of millions of dollars in
capital and operating expenses needed to extend this line to Lancaster would be borne by the
MTA, prior approval by the MTA Board was required. The MTA Board, however, did not meet
G:\mta\mediate\rg-bliss 102
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
after the earthquake until January 26, 1994. Two days earlier, on January 24, 1994, Metrolink
trains began running on the extended Santa Clarita Line to and from Lancaster. Memo from
Richard Stanger to Finance, Budget and Efficiency Committee, at 2-3 (Jan. 21, 1994) (revised
Jan. 25, 1994), M322539 at M322540-41; MTA's Relationship with the SCRRA, at 5 (Jan. 25,
1995), M323405 at M323409; Minutes o f MTA Special Board Meeting (Jan. 5, 1994),
M901896; Minutes o f MTA Special Board Meeting (Jan. 26, 1994), M901899; Minutes o f MTA
Regular Board Meeting (Jan. 26, 1994), M901902; Dep. o f Dana Woodbury, at 190, 197-206
(July 31, 1995) (Vol. 2).
308. According to MTA official and Metrolink Executive Director Richard Stanger,
between January 17 and January 26, Metrolink "acted on behalf of LACMTA in obligating
purchase orders and change orders totalling $8 million primarily for material procurement."
Memo from Richard Stanger to Terry Matsumoto (Jan. 31, 1994), M322551; MTA Admission
No. 94 (admitted that the quoted document "speaks for itself).
309. When the MTA Board finally did meet on January 26, it effectively ratified
Metrolink's actions and expenditures on behalf of MTA, and the MTA Board also agreed to
double MTA's contribution to Metrolink that fiscal year from approximately $49 million to
approximately $98 million. Minutes of MTA Regular Board Meeting, at 5 (Jan. 26, 1994),
M901902 at M901906; see also Dep. of Dana Woodbury, at 202-03 (July 31, 1995) (Vol. 2).
310. In a memo to the Metrolink Board pertaining to the costs of extending the Santa
Clarita Line and of related matters, Metrolink's Richard Stanger explained: "Capital and
operating costs for the incremental services total $63.2 million." Approval o f the Metrolink
Emergency Transportation Services Plan, at 2 (Feb. 4, 1994), M322531 at M322532, attached to
Metrolink/SCRRA Agenda (Feb. 11, 1994), M322498; MTA Admission No. 95 (admitted that the
cited document "contains the language quoted"). The MTA sought reimbursement of these costs
and other MTA costs from the Federal Emergency Management Agency (“FEMA”). However,
because some of the Metrolink projects had been previously planned, and because there had been
a pre-existing need for other Metrolink projects, FEMA formally disallowed reimbursement for
approximately $10.2 million of expenditures on the Santa Clarita Line, and FEMA (as of August,
G:\mta\mediate\rg-bliss 103
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
1995) also declined to provide reimbursement for another approximately $10.5 million of
expenditures on the Santa Clarita Line. This had no negative affect on the Metrolink budget
because, as Richard Stanger testified, "it was the MTA's funds that were backing this up." Dep.
o f Dana Woodbury, at 171 (July 31, 1995) (Vol. 2); Accounting o f Advanced Funds, at attached
charts (Aug. 8, 1995), M341193 at M341198-99; Dep. o f Richard Stanger, at 276-79 (Sept. 26,
1995) (Vol. 2); Dep. o f Richard Stanger, at 33-34 (July 27, 1995) (Vol. 1).
311. In approving the extension of the Santa Clarita Line north to Palmdale and on to
Lancaster, the MTA had hoped for reimbursement from FEMA not just of the MTA's capital
expenses, but also of the operating expenses along the 45-mile extension at least through
November 1994. The highway interchange at Interstate 5 and Route 12, however, was repaired
and reopened many months earlier on July 15, 1994, after which FEMA refused to consider
reimbursement operating expenses. This loss of reimbursement from FEMA did not immediately
affect MTA — which at that very time was raising MTA bus fares and eliminating MTA bus
passes — because MTA had already budgeted "a reserve of $2,500,000 . . . to be used for
operations subsidy and maintenance of way expense between Via Princessa [in Santa Clarita] and
Lancaster in the event that FEMA participation in this service is terminated prior to November
30, 1994," with this $2.5 million being "sufficient to provide for operating and maintenance of
way subsidies for four months." FEMA Funding for Metrolink Projects (July 20, 1994),
M322481; Northridge Earthquake Relief Funding (Oct. 12, 1994), M322451; Authorization of
the LAC MTA o f FY 1994-95 SCRRA Budget, at 1-2 (May 2, 1994), M0230134 at M0230134-35.
312. Within a week of the extension of the Santa Clarita Line, Metrolink conducted a
morning-boarding ridership survey on the Santa Clarita Line, a survey which revealed that: "90
percent of the survey respondents boarded at the Santa Clarita Station; 4 percent boarded at the
Palmdale Station; and 5 percent boarded at the Lancaster Station." Memo from S.T. Parry to
Earthquake Transportation Subcommittee Members, at attachment (Feb. 2, 1994), M322575 at
M322578.
313. Several months later, Palmdale closed its Palmdale Station, meaning that
Metrolink trains no longer stop there. Although the Lancaster Station remains open, a Metrolink
G:\mta\mcdiate\rg-bliss 104
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
ridership survey revealed that, in November 1994, less than a year after the Northridge
earthquake, an average of only 143 passengers boarded Metrolink trains each morning at the
Lancaster Station. Dep. o f Dana Woodbury, at 208-09 (July 31, 1995) (Vol. 2); MTA's
Relationship with the SCRRA, at Exhibit 2 (Jan. 25, 1995), M323405 at M323421; MTA
Admission No. 98 (admitted that "Palmdale is no longer a stop on Metrolink's Santa Clarita
Line ").
314. In part because of the small number of passengers being served on the Santa
Clarita Line, a high-level MTA finance official recommended, in June 1994 — in a memo
addressing ways in which the MTA could save money - the elimination of Metrolink service on
the Santa Clarita Line, at least on the 45-mile extension from Santa Clarita to Lancaster:
Metrolink is proving itself to be one of the most outstanding
transportation failures in the history of the U.S. transit industry.
In particular, the extension of the Santa Clarita line to Palmdale
and Lancaster, with Metrolink management using the excuse of the
January 17, 1994, earthquake to justify this expensive and almost
unutilized line, should be undone as soon as possible.
* * *
[The] MTA will be stuck with the operational expenses of running
this line without a purpose for decades to come unless the Board
takes action to stop it.
Since the North County Line is exclusively within Los
Angeles County, the entire cost of this line is borne by MTA.
Therefore, it is well within the power of MTA to cancel this entire
line.
Comments on MTA FY95 Budget at 5-6 (June 27, 1994), 011807 at 011812-13. This
recommendation has never been acted on by, and never even presented to, the MTA Board.
6. MTA Has Absolute Control Over
All MTA Funding Expended On Behalf
Of Metrolink Within Los Angeles Countv
G:\mta\mcdiate\rg-bliss 105
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
315. As set forth in the originating Metrolink/SCRRA Joint Powers Agreement, and in
numerous MTA memos and documents, MTA has absolute control over what it spends on
Metrolink (with regard to, e.g., capital expenses, operating expenses, maintenance-of-way
expenses, security expenses, and so on) within Los Angeles County. Joint Powers Agreement, at
3, § 4.4 (July/August, 1991), M902439 at M902441; see, also MTA's Relationship with the
SCRRA, at 5 (Jan. 25, 1995), M323405 at M323409.
G. MTA's Development Of Rail Lines Has Not Provided
Efficient And Effective Benefits To Minority Communities
316. The MTA has never evaluated whether bus riders suffer from the reduced bus
service when bus lines that are near train lines are eliminated or modified. The introduction of
train lines has effectively reduced the mobility of minority poor residents and increased their
transportation costs. Testimony of Martin Wachs, and Marvin Holen.
317. MTA's urban rail strategy was not designed to serve minority poor bus riders'
transportation needs. The vast majority of minority poor do not live within walking distance of
train stations and cannot readily reach the train. Commuter trains, with stations often a mile
apart, were not designed with poor inner city travelers in mind and do not stop at grocery stores,
day care sites, churches and the other destinations of minority poor riders within their
communities. Testimony o f Martin Wachs and Thomas Rubin.
318. MTA has never conducted a study of non-riders or riders from minority poor
communities to find out their transportation needs and then designed a system to address those
needs. Nor has MTA designed a transportation plan to foster economic development in the
minority community. Testimony of Martin Wachs and Antonio Villaraigosa.
319. MTA's rail strategy was not designed to provide economic development in poor
minority neighborhoods. MTA has depleted much needed resources for the bus system on which
the overwhelming majority of minority poor depend. MTA's trains serve only a minuscule
percentage of the transit dependent minority poor. The train lines merely replace preexisting bus
lines that were often more convenient for local travel. In any event, five times as many local
jobs are created by an equal expenditure of public funds on bus operations than on rail
G:\mta\mediate\rg-bliss 106
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
construction. MTA, Relative Number of Local Jobs Created by an Equal Expenditure o f Public
Funds (undated) 800194; Testimony o f Eric Mann, Martin Wachs and Thomas Rubin.
320. According to an American Public Transit Association report, the relative
economic impacts of rail and bus expenditures nationally are roughly comparable, with bus
capital projects ranking highest. RTD, Rubin, Economic Impact o f Transit Expenditures (April
22, 1992) (economic impact o f bus capital projects derived by applying multiple o f 3.50; o f
modernization of rail transit derived by applying multiple o f 3.15; o f new rail systems derived by
applying 3.07; of transit operations derived by applying 3.05), 010436 at 010437.
321. RTD compared the economic impacts of bus and rail subsidies:
• A dollar spent on bus operating subsidies generates over
60% more total economic activity in the nation than does a
dollar spent on rail construction
• The relative impact on the local economy is even more
pronounced in favor of bus operations over rail capital —
undoubtedly at least two to one and probably well over
three to one
• Since a larger portion of capital project expenditures are
from material goods -- buses, rail cars, land acquisition,
construction materials, etc. — a far higher portion of
expenditures from bus operations goes for people — and
jobs
• The relative impact on local employment is also far larger
for bus operations subsidies than for rail capital
expenditures, undoubtedly over two to one and most likely
well over three to one
• The vast majority of bus jobs positions are well-paid, long
term positions providing meaningful employment for
largely minority and female individuals with deep roots in
G:\mta\mcdiate\rg-bliss 107
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
the area, that are providing service to the many
communities they represent
• A far higher portion of rail capital positions are outside of
the local area and the United States. The local positions
tend to be short-or medium-term jobs, far more likely to be
filled by Caucasian males who have far less prior, current,
and future likelihood to reside in the local area
• An investment in bus operations produces local economic
benefits, and jobs, many times faster than an investment in
rail capital
• An investment in bus operations creates far more transit
output and trips than an equal investment in rail
construction and, as a result, there are far higher indirect
positive economic benefits from investments in bus than in
rail
• Since a far larger portion of the economic activity of bus
operations than rail construction is local, investment in bus
operations creates more local transit sales tax revenues and
more Federal transit formula grant funds.
Id. 010436 at 010444.
322. Under current federal incentive programs to spur economic development,
communities are supposed to reap substantial economic benefits from the placement of rapid rail
corridors. When MTA rail lines traverse minority communities, as does the Blue Line, minority
communities do not benefit from economic development. MTA, Long Beach-Los Angeles Rail
Transit Project Final Environmental Impact Report (March 1985), M306934 at M307206;
Testimony o f Lucius Collier.
H. MTA’s Predecessors RTD And LACTC Changed Plans That
Developed Rail In Minority Communities To Plans That
Provided Service To The Disproportionately White Suburbs
G:\mta\mediate\rg-bliss 108
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
323. The RTD and LACTC changed plans that developed rail systems in South Central
to plans that provided rail service almost exclusively to the suburbs. The changes corresponded
to demographic shifts in the white population of the County. Testimony o f Lucius Collier, Brian
Taylor, and Martin Wachs.
324. An example is the history of the Crenshaw rail corridor project. In 1967-68, the
RTD proposed a rail system that called for a rail line running from downtown Los Angeles, past
the University of Southern California, to the Crenshaw Shopping Center, Inglewood, and the
Airport. At the time of this proposal, more than 50 percent of the residents in the area were
white. Testimony of Lucius Collier. (Mr. Collier, former RTD Director of Community Relations,
was an RTD employee for 17 years until 1988).
325. In 1974, the RTD proposed a rail system that included an Airport Southwest
Corridor that ran from La Brea and Wilshire south to the Crenshaw Shopping Center, Inglewood,
and the Airport. This modification of the 1967-68 alignment reflected a desire to avoid the
community south of downtown, near the University of Southern California where the majority of
residents were black and poor. Testimony o f Lucius Collier.
326. In a 1988 study, SCAG recommended that LACTC and RTD should consider a
rail line along the Crenshaw corridor. SCAG's stated that its study "demonstrated that a
Crenshaw corridor rail transit line” has:
• A strong ridership potential on both the regional
and local levels.
• Attracted strong community support and interest.
SCAG noted that the Crenshaw alternative had higher systemwide ridership projections than the
Wilshire Boulevard Metro Rail extension (59,000 ridership compared to 46,000 Wilshire
ridership) and that the Crenshaw line would be cheaper than the Wilshire MetroRail. The
Crenshaw line would serve as a link between major centers outside the study area (such as the
III
III
III
G : \m ta\m<xJ i ate\rg-bl iss 109
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
central business district and LAX) as well as those within the area. SCAG stated that other
benefits of the Crenshaw line included service to:
• The most densely populated area of its size in the
region.
• A highly transit-dependent population.
SCAG, Airport Southwest Area Transportation Study, Executive Summary (Dec. 1988), C002588
at C002607-08.
327. The Crenshaw corridor, from Mid-City area on Crenshaw and then west to LAX,
contains heavily utilized bus routes and would traverse high density urban area. The corridor
would connect Blue Line, Red Line and Green Line as well as inner city areas with LAX. The
corridor project also represents "one of the best opportunities for combining mobility
enhancements with economic development efforts in the central city."
[T]his Corridor travels through some of the areas hardest hit by
the civil unrest of 1992 and areas which have been under-served
by public investment in the past. New transit services within the
Corridor would represent not only a significant mobility
improvement, but could serve to focus other public investment
efforts in economic development. The Corridor includes Leimert
Park, an emerging focal point of the African American community
and home to a growing concentration of minority owned
businesses and the two regional shopping centers serving the South
Central area.
MTA, Korve Engineering, Inc./Terry A. Hayes Associates, Crenshaw-Prairie Transportation
Corridor Preliminary Planning Study (Oct. 1994), M325150 at M325155, M325168, M325175,
M325185.
328. In 1980, the LACTC proposed Proposition A, which called for a new rail system
and an improved bus system. The ballot contained a map showing bands ranging from two to
five miles wide in minority areas which were to be considered for rail lines, should the proposal
G:\mta\mcdiate\rg-bliss 1 1 0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
pass. Although the measure was not supported by most suburban communities, Proposition A
passed with the support of the black and Hispanic transit-dependent riders, in part due to the
promise of rail transportation development and bus improvements that would benefit the inner
city communities of Los Angeles. Testimony of Lucius Collier, and Martin Wachs.
329. In 1983, RTD management refused even to include a Crenshaw rail station stop
on Wilshire Boulevard for the then-prepared initial Metro Rail Line route. The Crenshaw station
was included only after presentations by community representatives and elected officials at a
public hearing. Testimony o f Lucius Collier.
VI. MTA DISPROPORTIONATELY ALLOCATES MILLIONS OF DOLLARS
TO MUNICIPAL BUS OPERATORS THAT PROVIDE QUALITY
SERVICE TO HEAVILY WHITE RIDERSHIPS_______________
330. Despite the McCone Commission finding that the MTA should absorb all the
small municipal operators to avoid balkanization, the MTA today instead funds numerous -
municipal bus operators, most of which provide local and express service to outlying
predominantly white, suburban areas. Rather than absorb the other bus operators, MTA
(LACTC) in 1987 transferred funding for a number of MTA (RTD) bus lines to LADOT
Commuter Express and Foothill Transit. Testimony of Lucius Collier; MTA, A Look At The MTA
(Jan. 1994), 800042A at 800057A-58A, 800085A.
331. RTD calculated that in FY 1990, the turnover of RTD lines to Foothill Transit
resulted in a net loss to RTD. While costs went down $5.1 million, fares and subsidies went
down $5.6 million for a net loss of $400,000. RTD, Impact o f Turnover o f Foothill Transit Zone
Routes on District Cash Flow (Aug. 24, 1991), 01035.
332. The MTA funds 16 "included" and "eligible" municipal bus operators, all of
which have base cash fares lower than the $1.35 base cash fare for MTA buses. According to
III
III
III
III
III
G:\mta\mcdiate\rg-bliss i l l
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
the MTA, the base cash fares in FY 1995 for the twelve municipal operators which provide
fixed-route bus service were as follows:
80c Antelope Valley Transit Authority
free Commerce Bus Lines
60c Culver CityBus
85c Foothill Transit
50c Gardena Transit
$1.10 LADOT Commuter Express
25c LADOT DASH
90c Long Beach Transit
75c Montebello Bus Lines
60c Norwalk Transit
75c Santa Clarita Transit
50c Santa Monica Bus Lines
50c Torrance Transit
As to the four dial-a-ride municipal operators (which provide no fixed-route bus service), their
base cash fares for FY 1995 were: 75c in Arcadia; $1.25 in Claremont; $1.00 in La Mirada;
and $1.00 in Redondo Beach. MTA Short Range Transit Plan Fiscal Years 1966-99 at 2, and at
Tables 5-1, 5-2, 5-3 (June 2, 1995), M336444 at M336451, M336497-99; MTA Admission No.
20 (admitted that the first-cited table "shows" all o f the foregoing fares, with the exception o f the
LADOT DASH 25<t fare).
Ill
III
III
III
III
III
III
G:\mta\mcdiatc\rg-bliss 112
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
333. These 16 municipal operators vary considerably in size, a fact which is reflected
in part by their fixed-route peak bus fleets in FY 1995. The four dial-a-ride municipal operators
— Arcadia, Claremont, La Mirada, and Redondo Beach — have no fixed-route buses at all. Eight
relatively small municipal operators maintained peak fleets of fewer than 50 buses:
32 Antelope Valley Transit Authority
6 Commerce Bus Lines
24 Culver CityBus
38 Gardena Transit
34 Montebello Bus Lines
15 Norwalk Transit
39 Santa Clarita Transit
43 Torrance Transit
Four larger municipal operators maintained peak fleets of more than 100 buses:
186 Foothill Transit
117 LADOT
154 Long Beach Transit
106 Santa Monica Bus Lines
In comparison, MTA operations in the same fiscal year maintained a fixed-route peak fleet of
1,822 buses. MTA Short Range Transit Plan Fiscal Years 1966-99 at Table 5-2 (June 2, 1995),
M336444 at M336498.
A. The Municipal Bus Operators Serve A
Ridership That Is Disproportionately White
334. As to the race/ethnicity of the riders on the buses of the municipal operators,
ridership surveys have indicated that the ridership on the buses of several municipal operators is
disproportionately white or Anglo compared with the approximately 80 percent minority ridership
on MTA buses: Of the riders identifying their race/ethnicity, 59 percent are white on LADOT
Commuter Express; 32 percent white on LADOT DASH Downtown; 36 percent white on
Foothill Transit overall; 44 percent white on Foothill Transit express buses; and 52 percent
G:\mta\mcdiate\rg-bliss 113
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
white or Anglo on express buses operating in the San Fernando Valley (two Antelope Valley
Transit Authority routes, seven LADOT Commuter Express routes, and nine MTA routes). Final
Report Commuter Express December 1992 On-Board Survey, at 6-8 (Dec., 1993), S0787 at
S0797-99; Dash Downtown On Board Survey Final Report, at 26 (April, 1994), S0890 at
S0917; Foothill Transit Attitude and Awareness Study, at 4-1, 4-2 (Feb., 1994), S1264 at S1280,
S1281; Study of Restructuring Public Transit Service in the San Fernando Valley, On-Board
Survey, at i, vii (Sept., 1993), D110304 at D110305, D110311.
335. As to the race/ethnicity of the riders on the buses of the municipal operators in
general (on the 16 "included" and "eligible" municipal operators, minus LADOT and Foothill
Transit for which race/ethnicity ridership data are available), 1990 census household data indicate
that, in the cities served by the municipal bus operators, of the transit-dependent households
(households without automobiles) more than 55% are white. (The cities served by the municipal
operators, as identified by the municipal operators in their Short Range Transit Plans submitted to
the MTA, include Arcadia, Bellflower, Carson, Cerritos, Claremont, Commerce, Compton, Culver
City, El Segundo, Gardena, Hawaiian Gardens, Hawthorne, Hermosa Beach, La Mirada,
Lakewood, Lancaster, Lawndale, Long Beach, Lomita, Montebello, Monterey Park, Norwalk,
Palmdale, Paramount, Pico Rivera, Redondo Beach, Rosemead, Santa Clarita, Santa Fe Springs,
Santa Monica, Seal Beach, Signal Hill, Torrance, and Whittier.) 1990 Census Household Data.
B. The Municipal Bus Operators Offer Their
Riders High Quality Services Relative To The
Services Given To The Riders of MTA Buses
336. Not only do the municipal operators charge fares lower than the $1.35 MTA bus
fare, see, supra, they also provide better service to their riders relative to the service provided to
the riders of MTA buses: The municipal operators' buses on average are not as crowded as
MTA's overcrowded buses; the municipal operators' buses on average are newer/younger than
MTA's buses; some of the buses operated by the municipal operators have padded seats,
reclining seats, overhead reading lights, and bathrooms, amenities not available on any MTA
buses serving local routes. Dep. o f Jon Hillmer, at 97-98 (Aug. 11, 1995); Dep. o f Steven
Brown, at 238-87 (Sept. 15, 1995) (Vol. 2); Dep. o f Steven Brown, at 388-406 (Sept. 18, 1995)
G:\mta\mcdiate\rg-bliss 114
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
(Vol. 3); Foothill Transit Short Range Transit Plan For Fiscal Year 1996 - Fiscal Year 1999
(March 22, 1995), D109794; Antelope Valley Transit Authority Short Range Transit Plan FY
1995-99 (March 22, 1995), D117353; Santa Clarita Transit Short Range Plan FY 1994-97
(March 23, 1993), D117206; MTA, Bus Capital Funding in Los Angeles County (July 5, 1994),
M1020656.
337. According to MTA, as of June, 1993, the average mileage of the MTA bus fleet
was 338,830 miles, whereas the average mileage of the buses of the municipal operators was
185,331 miles. While the average age of MTA buses was 8.2 years, LADOT buses had an
average age of 6.6 years and an average mileage of 65,104 miles, Foothill Transit buses had an
average age of 4.3 years and an average mileage of 117,293 miles, Antelope Valley Transit
Authority buses had an average age of 3.6 years and an average mileage of 91,756 miles, and
Santa Clarita Transit buses had an average age of 2.8 years and an average mileage of 65,000
miles. MTA, Bus Capital Funding in Los Angeles County (July 5, 1994), M1020656 at
M1020665-66.
338. An MTA-commissioned study of express bus service in the San Fernando Valley,
which in part compared characteristics and preferences of LADOT Commuter Express bus riders
vs. MTA express bus riders, reported that the LADOT routes tend to carry higher-income
passengers who are more likely to have cars, and that the riders "choosing to drive to an express
route prefer to drive to LADOT routes, probably because of speed and/or because of the more
modem and comfortable buses that run on most of those routes." Study o f Restructuring Public
Transit Service in the San Fernando Valley, On-Board Survey, at x (Sept. 1993), D110304 at
Dl 10314; San Fernando Valley Transit Restructuring Study, On-Board Survey Analysis, at ix
(July 1993), Dl 10214 at Dl 10222, attached to Memo from Russell Chisholm (July 8, 1993),
D110210. The reason for the speedier trips on the LADOT routes is not that the LADOT buses
are faster: "the buses are not faster than are MTA or RTD buses; it's just that they are on bus
routes that are on the freeway for longer distances." Dep. o f Jon Hillmer, at 97 (Aug. 11, 1995).
As to the LADOT's more comfortable buses: "The coach that they run is more of an inter-urban
style coach," "their buses were designed primarily for longer-distance travel," "they have
G:\mta\mediate\rg-bliss 115
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
reclining seats and so forth designed for longer-distance travel." Id. As to the LADOT's more
modem buses: "LADOT buses, on average, are newer than MTA buses simply because LADOT
began service in 1988-1990 on these routes, so the buses are that vintage," whereas MTA buses
sometimes are 14 years old, somewhat older than the 12-year average life for a bus. Id. at 98.
339. The foregoing study of the express bus services in the San Fernando Valley also
surveyed and compared rider satisfaction (rating the service as good, very good, or excellent) on
LADOT Commuter Express buses, on Antelope Valley Transit Authority express buses, and on
MTA express buses. All of the express routes operated by the LADOT and by the Antelope
Valley Transit Authority were rated as "excellent" or "very good." Of the nine routes operated
by the MTA, none was rated as "excellent," three were rated as "very good," and six were rated
as only "good." Study of Restructuring Public Transit Service in the San Fernando Valley, On-
Board Survey, at ix (Sept. 1993), D110304 at Dl 10313.
340. On Santa Monica Municipal Bus Lines, "a bus line operates within one-quarter
mile of every Santa Monica residence," History o f Santa Monica's Big Blue Bus, at 9 (1992),
S0696 at S0706, which makes bus riding extremely convenient for Santa Monica residents given
the transportation industry standard that potential riders of public transit will not walk farther
than % mile to access public transit. Dep. o f Jon Hillmer, at 119 (Aug. 11, 1995); Dep. of
Richard Stanger, at 104 (July 27, 1995) (Vol. 1); Study of Restructuring Public Transit Service
in the San Fernando Valley, On-Board Survey, at iv (Sept., 1993), D110304 at D110308.
341. Riders on Foothill Transit had and continue to have — before and after the MTA
voted to eliminate its discounted monthly MTA bus passes - the opportunity to purchase a
discounted Foothill/MTA joint monthly pass for use both on Foothill Transit buses and on MTA
buses. The MTA agreed to implement and to continue this joint monthly pass, in part, in order
to offer riders the "convenience" of one monthly pass. Even after the MTA Board voted to
eliminate its discounted MTA regular pass, the MTA never rescinded its joint monthly pass with
Foothill Transit: In August 1994, the MTA announced through a formal written "notice" that its
regular monthly passes would be "discontinued as of September 1, 1994," but that the "joint
monthly pass privileges with Foothill . . . Transit remain in effect." Private Sector Forum
G:\mta\mediate\rg-bliss 116
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Agenda (April 13, 1993), M0220232 at M0220267; Joint Pass Agreement with Foothill Transit
(Feb. 28, 1995), M323174; RTD Fares & Transfer Notice No. 94-61 New Fare Structure - MTA
(Aug. 22, 1994), M807050; MTA Admission No. 25 (admitted in part "that the joint monthly
pass for use on MTA and Foothill Transit buses remains in effect").
C. MTA (LACTC), Through Its Bus Service
Continuation Project, Helped To Create Two Of The
Largest Commuter-Express Municipal Bus Operators
342. In the mid-to-late-1980s, the MTA (LACTC), through its Bus Service
Continuation Project (BSCP), helped to expand LADOT bus service by arranging for LADOT to
take over eleven express and local lines previously operated by the RTD, and by arranging for
the financing of the capital costs and operating costs on the transferred lines. As described by
LADOT:
The BSCP was implemented in 1987. . . . A total of 11
lines, including 2 local and 9 express, were assumed by the City
from SCRTD. . . . As part of this project, the City received
approximately $4.5 million in Section 3 funds from an UMTA
grant for acquisition of 40 transit vehicles. The LACTC acted as
the grantee for the project, and contributed approximately 50
percent of the local match. . . .
The BSCP service has essentially maintained the routing
and schedules previously operated by SCRTD. . . . The BSCP
COMMUTER EXPRESS lines operate between Downtown Los
Angeles and the San Fernando Valley, Westside, South Bay
communities.
City o f Los Angeles Department o f Transportation Short Range Transit Plan 1994-97, at 1-2
(undated), D109728 at D109729-30; MTA Admission No. 26 (admitted that the "document
speaks for itself).
343. As to Foothill Transit: "On December 2, 1987, the LACTC [the MTA's county
wide planning agency predecessor] established the Foothill Transit Zone. . . . Based on certain
G:\mta\mediate\rg-bliss 117
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
rules established by the LACTC, the Foothill Transit Zone is tentatively established as an
operator of public transportation services." Foothill Transit Zone Short Range Transit Plan FY
1989-1991, at 1 {May, 1988) (brackets and ellipsis added), D119544 at D119547.
344. The MTA (LACTC) used its Bus Service Continuation Project (BSCP) to create
Foothill Transit by arranging for Los Angeles County and then for Foothill Transit to take over
six express and local lines previously operated by the RTD, and by arranging for the financing of
the capital costs and operating costs on the transferred lines. As described by the MTA:
The Bus Service Continuation Project (BSCP) was a
project undertaken by the City of Los Angeles and Los Angeles
County to operate, via private contractors, local and express routes
which were formerly operated by the Southern California Rapid
Transit District (SCRTD). Eleven SCRTD local and Express lines
were transferred to the City of Los Angeles and six local &
Express lines were transferred to the County of Los Angeles. The
project started in FY 1987. The total operating cost of the project
for the first year was approximately $4 million.
The Capital Cost was about $11.5 million. The operating
costs were shared between L.A. City, County and the LACTC.
The Capital Costs were shared between the LACTC, the City of
Los Angeles and the FT A. The City's and County's share of funds
came from their local return allocation. LACTC's share came
from the Prop. A incentive funds.
Foothill assumed administration of the BSCP lines in
November, 1990, and started getting Prop A incentive funds
directly for the service from LACTC.
MTA, Item #5, Foothill Transit Zone Package (undated), D107579, attached to Bus Operations
Subcommittee Agenda (July 25, 1995), D107561; MTA Admission No. 27 (admitted that the
cited document "contains the indented passages," and that "the document speaks for itself).
G:\mta\mcdiate\rg-bliss 118
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
345. The LACTC/MTA has continued to provide funding to LADOT and to Foothill
Transit for the operation of these Bus Service Continuation Project (BSCP) bus lines ever since.
MTA Admission No. 28 (admitted that the "MTA allocates funds to LADOT and to Foothill
Transit for operation of lines that are part of the Bus Service Continuation Project").
346. For FY 1995-96, for example, the MTA provided Foothill Transit with
$2,209,305 to operate its BSCP bus lines, which was $943,957 more than Foothill Transit had
anticipated and had budgeted for in its FY 1995-96 Budget, a matter summarized by Foothill
Transit in June 1995 as follows:
Update on Foothill Transit Bus Continuation Project (BSCP)
-- Staff met with the MTA's Executive Officer of Planning and
Programming, Judy Wilson, to discuss the funding of the Bus
Service Continuation Project. It was agreed to fully fund the
BSCP lines in Fiscal Year 1995 . . . [in the amount of] $2,209,305
next year instead of the proposed $ i,265,348 — an increase of
$943,957 over our adopted FY 1995/96 budget.
Memo from Foothill Transit to Executive Board, at 2 (June 23, 1995), S I438 at 1439.
347. The Chief Financial Officer of the RTD stated in 1992 that the Foothill Transit
(sometimes also called the Foothill Transit Zone or "FTZ") experiment is beginning to turn Los
Angeles into a two-class transit County:
Another problem with the FTZ experiment is that it is
beginning to turn Los Angeles into a two-class transit County.
Areas that tend to be more white, suburban middle class, such as
many of the areas now served by FTZ, are receiving brand new
buses with passenger amenities such as soft seats and reading
lights. The central city, served by SCRTD, with passengers with
much more of a tendency to be members of minority groups and
the transit dependent, receive older buses with hard seats — and
the most overcrowded service of any major transit operator in the
G:\mta\mediate\rg-bliss 119
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
United States. The generally more affluent FTZ passengers also
receive the benefit of fares lower than SCRTD's riders, subsidized
in part by the over-removal of funds from SCRTD to fund FTZ.
RTD, Making the Decision for Contracting Services — The Right Way (undated), 001103 at
001109-10; MTA Admission No. 29 (admitted that the document "speaks for itself).
D. Through A Variety Of Creative Funding Programs,
MTA Has Provided Disproportionate Funding To
— And Thus Has Helped To Maintain The Low Fares
And Better Service Of -- The Municipal Bus Operators
1. In The Late 1970s, MTA (LACTC)
Adopted Its FAP Formula, Through
Which MTA (LACTC) Began to Funnel
Millions Of Dollars Of State And Federal
Funds To The Municipal Bus Operators
348. The principal means by which MTA distributes federal, state, and local operating
funds to the municipal bus operators, and to MTA bus operations, is through the application of
an allocation formula called the Formula Allocation Procedure (FAP). The FAP formula was
devised and adopted by the LACTC in 1979, and initially applied to allocate federal and state
operating funds to the then 12 "included" municipal operators, and to the RTD. The FAP
formula is not based upon total bus ridership or upon total bus rider miles but instead upon in-
service revenue vehicle mileage plus fare units, and is formally defined as follows:
50 percent weight on in-service revenue vehicle mileage; [plus]
50 percent weight on Fare Units (defined as total farebox revenue
divided by the base fare).
MTA Short Range Transit Plan Fiscal Years 1966-99, at 2, 9-12 (June 2, 1995), M336444 at
M336451, M336458-61; MTA Admission No. 30 (admitted that "MTA allocates funds to
municipal operators in Los Angeles County, that the Formula Allocation Procedure (FAP) was. -..
adopted by the LACTC in 1979, and that the FAP speaks for itself and consists o f' the definition
quoted).
349. Following the enactment in 1980 of the A<t sales tax measure known as
Proposition A, and following the actual implementation of Proposition A, the LACTC added 95
G:\mtaVnediate\rg-bliss 1 2 0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
percent of the Proposition A 40 Percent Discretionary funds to the operating funds being
distributed to the then-12 municipal operators and the RTD via the FAP formula. These funds
have totalled more than $100,000 million each year over the last 15 years. Dep. o f Steven
Brown, at 19, 27 (Aug. 21, 1995) (Vol. 1); MTA Short Range Transit Plan Fiscal Years 1996-
99, at Tables 4-1 & 4-2 (June 2, 1995), M336444 at M336466-67; MTA Admission No. 31
(admitted "that, following the adoption of Proposition A, the LACTC began allocating
Proposition A 40 Percent Discretionary dollars to the 'included' municipal operators and the
RTD").
2. In The Early 1990s, MTA (LACTC)
Made Four More Municipal Bus
Operators Eligible For Millions Of
Dollars Of Additional Funding From MTA
350. In the early 1990s, subsequent to the enactment in 1990 of the lA<t sales tax
measure known as Proposition C, the LACTC responded to four of the newest municipal
operators — LADOT, Foothill Transit, Antelope Valley Transit Authority, and Santa Clarita
Transit — which had applied to the LACTC to be designated as "included" municipal operators
so that they too could receive operating funds from the LACTC through the FAP formula. MTA,
Included Municipal Operator Status for the City o f Los Angeles (July 3, 1991), D118287; MTA,
Included Municipal Operator Status for Santa Clarita Transit and the Antelope Valley Transit
System (July 3, 1991), D118281; Dep. of Steven Brown, at 15-28, 107 (Aug. 21, 1995) (Vol. 1);
Dep. o f Steven Brown, at 146-283 (Sept. 15, 1995) (Vol. 2).
351. The LACTC designated LADOT an "included" operator, Foothill Transit a
"permanent" and "eligible" operator, and Antelope Valley and Santa Clarita "eligible" operators.
MTA Admission No. 32 (admitted).
352. At the same time, the LACTC agreed to fund the four new operators through the
FAP formula from a different source of funds - not from the 95 percent of the Proposition A 40
Percent Discretionary funds allocated to the initial 12 "included" municipal operators, but from
the 5 percent of the Proposition A 40 Percent Discretionary funds known as the Proposition A
Incentive Fund. MTA, Included Municipal Operator Status for the City o f Los Angeles (July 3,
G: \mta\mcd i ate\rg-bl iss 1 2 1
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
1991), D118287; MTA, Included Municipal Operator Status for Santa Clarita Transit and the
Antelope Valley Transit System (July 3, 1991), D118281; Dep. o f Steven Brown, at 15-20, 107
(Aug. 21, 1995) (Vol. 1); Dep. o f Steven Brown, at 146-283 (Sept. 15, 1995) (Vol. 2); MTA
Admission No. 33 (admitted "that LADOT, Foothill Transit, Antelope Valley Transit Authority,
and Santa Clarita Transit have received funding from the Proposition A incentive fund").
353. Designating the LADOT as an "included" operator required a change in policy by
the LACTC given that the LADOT simply did not meet and could not meet the long-standing
criteria of the LACTC necessary for the LADOT to become an included operator. The policy
change, which involved amending the criteria which needed to be met by a municipal operator in
order to be designated as an "included" municipal operator, was agreed to by the LACTC — as
admitted by an MTA official in sworn deposition testimony — so as "to allow the City of Los
Angeles DOT to be funded [and] designated as an Included Municipal Operator." MTA, Included
Municipal Operator Status for the City o f Los Angeles (July 3, 1991), D118287; Dep. o f Steven
Brown, at 151-52 (Sept. 15, 1995) (Vol. 2); MTA Admission No. 34 (admitted "that the LACTC
recommended that a ninth criterion be added for an 'included operator' designation upon eight
affirmative votes o f the Commission, and that in 1992 the City o f Los Angeles received
designation as an 'included' operator").
Ill
III
III
III
III
III
III
III
III
III
III
G:\mta\mediate\rg-bliss 1 2 2
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
3. For FY 1995-96, MTA Allocated
$77 Million In Operating Funds, And
Another $25 Million In Capital Funds
To The Sixteen Municipal Bus Operators
354. The varying amounts of the $77.6 million in operating funds programmed by the
MTA to the 16 included and eligible municipal bus operators for FY 1995-96 through the MTA's
FAP formula were as follows:
$ 765,345 Antelope Valley Transit Authority
$ 501,391 Arcadia Transit
$ 143,360 Claremont
$ 264,892 Commerce Bus Lines
$ 3,820,065 Culver CityBus
$17,171,952 Foothill Transit
$ 3,912,590 Gardena Transit
$ 2,754,426 LADOT
$ 236,162 La Mirada
$19,394,544 Long Beach Transit
$ 5,451,963 Montebello Transit
$ 1,434,990 Norwalk Transit
$ 78,404 Redondo Beach
$ 860,857 Santa Clarita Transit
$17,478,128 Santa Monica Municipal Bus Lines
$ 5,026,543 Torrance Transit
MTA Admission No. 35 (admitted).
355. MTA bus operations also receive funding through the FAP formula, but the
funding received does not represent the MTA share of county wide bus riders or bus-rider miles,
and its FAP allocation percentage has been steadily decreasing: Although MTA/RTD bus
operations served 85% of all of the bus riders in Los Angeles County in 1992, and provided 86%
of all bus-rider-miles, MTA/LACTC through the FAP formula provided only 81.9 percent of the
G:\mtaVnediate\rg-bliss 123
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
total bus operating funds to MTA/RTD bus operations in FY 1991-92, only 80.4 percent in FY
1992-93, only 79.9 percent in FY 1993-94, and only 79.8 percent in FY 1994-95, with the
remaining 20 percent or so allocated among the 16 municipal operators. MTA, A Look At The
MTA (Jan., 1994), 800042A at 800055A; Finance, Budget & Efficiency Committee
Recommendation, at Table 2 (July 13, 1994), M323880 at M323885; MTA Admission No. 36
(admitted in part "that MTA's allocation through the FAP formula were 81.9% o f the total bus
operating funds in FY 1991-92, 80.447c in FY 1992-93, 807c in FY 1993-94, and 79.87c in FY
1994-95").
356. As to the distribution of capital funds to the 16 municipal operators (and to MTA
bus operations), MTA allocates 85 percent of the capital funds pursuant to a formula somewhat
similar to the FAP formula, and MTA awards the remaining 15 percent of the funds on a
discretionary basis. Through the formula allocation and through the discretionary awards, MTA
for FY 1995-96 distributed approximately $25.1 million for capital expenses to the 16 municipal
operators, approximately as follows:
$ 368,428 Antelope Valley Transit Authority
$ 88,620 Arcadia Transit
$ 29,533 Claremont
$ 538,396 Commerce Bus Lines
$ 2,202,505 Culver CityBus
$ 3,146,956 Foothill Transit
$ 4,569,040 Gardena Transit
$ 59,446 La Mirada
$ 3,396,973 Long Beach Transit
$ 1,380,641 Los Angeles (LADOT)
$ 1,981,142 Montebello Bus Lines
$ 3,053,442 Norwalk Transit
$ 21,483 Redondo Beach
$ 814,965 Santa Clarita Transit
G:\mta\mediate\rg-bliss 124
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
$ 2,272,709 Santa Monica Municipal Bus Lines
$ 1.176.925 Torrance Transit
$25,101,204 Total
MTA Admission No. 37 (admitted "that, for FY 1995-96, the MTA distributed approximately
$25.1 million for capital expenses to municipal operators in the amounts listed"); MTA
Proposed 1995-96 Budget, at 94 (undated), M301108 at M301207; MTA Short Range Transit
Plan Fiscal Years 1996-99, at 2, 13, 16, & Table 4-15 (June 2, 1995), M336444 at M336451,
M336462, M336465, M336485.
357. Although MTA bus operations also received some of the 85 percent of the capital
funds allocated via formula, and although MTA bus operations are eligible for the 15 percent of
the capital funds awarded on a discretionary basis, MTA awarded none of the 15 percent
discretionary capital funds to MTA bus operations for FY 1995-96. MTA, instead, awarded,
millions of dollars of discretionary capital funds to three of the smallest municipal operators
providing fixed-route bus service: Commerce Bus Lines, Gardena Transit, and Norwalk Transit.
Dep. o f Steven Brown, at 206-09 (Sept. 15, 1995) (Vol. 2).
358. Over the years, MTA/RTD bus operations have received a smaller percentage of
the total MTA/LACTC capital funds than the percentage of county wide riders carried by
MTA/RTD buses, and similarly a smaller percentage of the total MTA/LACTC capital funds than
the percentage of countywide bus-rider miles on MTA/RTD buses. MTA, Bus Capital Funding
in Los Angeles County (July 5, 1994), M1020656 at M1020657-58, M1020661-64; MTA, ,4 Look
At The MTA (Jan. 1994), 800042A at 800055A.
Ill
III
III
III
III
III
III
G:\mta\mediate\rg-bliss 125
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
359. As to the percentage of total capital funds distributed by the MTA/LACTC to
MTA/RTD bus operations, vis-a-vis the municipal operators, the percentages for six fiscal years
are as follows:
MTA/RTD Capital
Allocation % Share Fiscal Year
74.3% 1989-90
73.3% 1990-91
77.0% 1991-92
66.2% 1992-93
74.6% 1993-94
76.3% 1994-95
MTA, Bus Capital Funding in Los Angeles County (July 5, 1994), M1020656 at M1020657-58,
M1020661-64; MTA Admission No. 39 (admitted that the cited document "indicates" precisely
the foregoing percentage shares).
4. For FY 1995-96, MTA Allocated An
Additional $15 Million To The Municipal
Bus Operators Through A Variety Of
Arbitrarily Established Funding Programs
360. For FY 1995-96, MTA allocated $15 million or so to various municipal bus
operators through MTA's bridge funds, through MTA's Base Bus Restructuring Program, through
MTA's Transit Service Expansion Program, and through MTA's Recession Assistance Allowance.
MTA Admission No. 40 (admitted).
361. For FY 1995-96, MTA overspent the revenue available for its Proposition A
Discretionary Incentive Fund Program by approximately $1.5 million; MTA had used its
Proposition A Discretionary Incentive Fund Program in part to provide operating funds to
III
III
III
III
III
G:\mtaVncdiate\rg-bliss 126
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
LADOT, Foothill Transit, Antelope Valley Transit Authority, and Santa Clarita Transit; MTA
then made up the difference through bridge funds:
$ 9,311,648 Program Expenses
- 7.799.930 Program Revenues (income and carryover)
- 1.511.718 Bridge Funds
$ 0 Balance
MTA bus operations received none of these MTA Bridge Funds. FY 1996 Proposition A
Discretionary Incentive Fund Program Budget (July 10, 1995), D109688; MTA Admission No.
41 (admitted "that, for FY 1995-96, the MTA had used its Proposition A Discretionary Incentive
Fund Program in part to provide operating funds to LADOT, Foothill Transit, Antelope Valley
Transit Authority, and Santa Clarita Transit").
362. According to the MTA FY 1995-96 Budget: "Base Bus Restructuring funds.are
provided to four operators (Foothill Transit, Torrance Transit, Montebello Municipal Bus Lines,
and Commerce Municipal Bus Lines) for services programmed in their Short Range Transit Plans
which were approved by the LACTC and added between July 1, 1990, and April 24, 1991.
These services are not included in the Proposition A base service level and are not eligible for
Proposition A discretionary funding. The total funding level has been frozen at the FY92 level
with no adjustments for inflation." MTA Admission No. 42 (admitted).
363. For FY 1995-96, MTA provided approximately $2.8 million in this type of
funding to four municipal operators, as follows:
$ 170,000 Commerce Bus Lines
$ 776,362 Montebello Bus Lines
$ 494,000 Torrance Transit
$1.361.000 Foothill Transit
$2,801,362 Total
MTA bus operations received no funds under the MTA Base Bus Restructuring Program.
Proposed Funds Programmed to Included, Permanent, and Eligible Transit Operators in FY96
Budget, at 2 (July 18, 1995), D118337 at D118338; MTA Admission No. 43 (admitted "that, in
G:\mta\mediate\rg-bliss 127
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
FY 1995-96, a total o f $2,801,362 was allocated to the municipal operators o f Commerce,
Montebello, Torrance, and Foothill").
364. According to the MTA FY 1995-96 Budget: "The Transit Service Expansion
Program was originally intended to fund additional congestion-relieving transit service, including
providing connections to the Metro Blue Line," and it is funded from Proposition C 40%
Discretionary funds. MTA Proposed 1995-96 Budget, at 95 (undated), M301108 at M301208;
MTA Admission No. 44 (admitted "that the Transit Service Expansion Program is funded from
Proposition C 40% discretionary funds, and that the paragraph quoted . . . appears in the MTA
1995-1996 Budget and that the document speaks for itself).
365. For FY 1995-96, the MTA allocated $5.7 million for this Transit Service
Expansion Program in the following amounts to the following transit operators:
$ 264,000 Antelope Valley Transit Authority
$ 159,554 Culver CityBus
$ 220,623 Foothill Transit
$ 471,000 Gardena Bus Lines
$2,044,724 LADOT
$1,555,000 Long Beach Transit
$ 147,000 Lynwood Metro Blue Line Shuttle
$ 251,000 MTA
$ 139,700 Torrance Transit
$ 411,790 Torrance Transit for MAX
Allocation o f Funding Through the Transit Service Expansion Program (June 14, 1995),
M322790; MTA Admission No. 45 (admitted "that, in FY 1995-96, the MTA allocated $5.7
million under the Transit Service Expansion Program to municipal operators in amounts as listed
. . . with the exception o f LADOT").
366. Of the foregoing $5.7 million spent on its Transit Service Expansion Program for
FY 1995-96, MTA gave only 4.4 percent to MTA bus operations. Allocation o f Funding
Through the Transit Service Expansion Program (June 14, 1995), M322790; MTA Admission
G:\mta\mediate\rg-bliss 128
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
No. 46 (admitted "that, o f the $5.7 million allocated to the Transit Service Expansion Program in
FY 1995-96, the MTA allocated $251,000 to MTA bus operations").
367. The $411,790 awarded by MTA through its Transit Service Expansion Program to
Torrance Transit for the Municipal Area Express (MAX), which it administers, came about as
result of a policy change in the MTA's funding/evaluation criteria. As explained by Torrance
Transit:
Proposition C Discretionary are funds from the Metropolitan
Transportation Authority from the Transit Service Expansion
(TSE) Program. Last year evaluation criteria were established
which precluded MAX from receiving funding. However, the
MTA Board directed their staff to revise the criteria in order to
make them more equitable. Under the current criteria, MAX
qualifies for full funding under the program.
This "full funding" from the MTA covered a full "62 %" of the initial MAX budget for FY 1995-
96, and it also allowed for "significant reductions in the [financial-contribution] shares from all
participants" in MAX. MAX Policy Steering Committee Meeting, at Item II C, Attachment II
(Aug. 7, 1995), S0216 at S0224; MTA Admission No. 47 (admitted that the document cited
"contains the indented passage and excerpted quotations . . . and that the document speaks for
itself).
368. Because of the economic recession of the early 1990s, the MTA (LACTC) Board
at that time decided to allocate Recession Assistance Allowance funding to all of the "included"
and "eligible" municipal operators (as well as to the MTA (RTD)), it did so through another and
different formula (akin to FAP), and it has done so annually ever since. Dep. o f Steven Brown,
at 209-12 (Sept. 15, 1995) (Vol. 2); Proposed Funds Programmed to Included, Permanent, and
Eligible Transit Operators in FY96 Budget, at 2 (July 18, 1995), D118337 at D118338; MTA
Admission No. 48 (admitted "that, in 1992, the LACTC Board decided to allocate Recession
Assistance funds to all 'included' and 'eligible' municipal operators and the RTD through a
formula").
G:\mta\mediate\rg-bliss 129
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
369. For FY 1995-96, MTA allocated $6,988,751 from Proposition C Discretionary
funds through this Recession Assistance Allowance funding to the 16 municipal operators (while
also awarding some monies to the MTA). Subsequent to the inception of this Recession
Assistance Allowance in the early 1990s, the MTA has provided the 16 municipal operators with
well over $30 million in this type of funding. Dep. o f Steven Brown, at 209-12 (Sept. 15, 1995)
(Vol. 2); Proposed Funds Programmed to Included, Permanent, and Eligible Transit Operators
in FY96 Budget, at 2 (July 18, 1995), D118337 at D118338.
5, MTA Also Funds The Municipal Operators
Through Various Other Ad Hoc Funding Measures
370. In May of 1995, MTA informally proposed that the MTA should formally help to
close the FY 1994-95 MTA budget gap by allocating approximately $15.5 million in Proposition
A and C interest funds to the MTA, but the MTA ended up also allocating $3.1 million to the
municipal operators. As described by Foothill Transit: after the municipal operators learned
about the MTA shortfall proposal, "MTA Chairman Larry Zarian met with the municipal
operators to discuss the matter. It was agreed to allocate $3.1 million (20%) of the interest funds
to the municipal operators. This agreement was approved by the MTA Board. . . . Foothill
Transit will receive an additional $618,985 in Fiscal Year 1996." Dep o f Steven Brown, at 114-
15 (Aug. 21, 1995) (Vol. 1); Minutes of the MTA Regular Board Meeting, at 4 (May 24, 1995),
M322660 at M322663; Foothill Transit Executive Director's Report, at 1-2 (June 23, 1995),
S1438-39; Minutes o f MTA Regular Board Meeting, at 4 (May 24, 1995), M322660 at
M322663; MTA Admission No. 49 (admitted "that the MTA Board in May 1995 approved the
allocation o f $3.5 million o f Proposition A Interest funds and $12.0 million o f Proposition C
Interest funds to the MTA; that it approved the allocation of $3.1 million o f Proposition A and
C Interest funds to the municipal operators, and that the quoted Foothill Transit document
speaks for itself).
6. Through Its "Call For Projects," MTA In The
Summer Of 1995 Granted Millions Of Dollars
In Funding To A Variety Of Transit Projects,
Many Of Which Directly Or Indirectly
Benefit The Sixteen Municipal Bus Operators
G:\mta\mediateVg-bliss 130
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
371. Through its biennial Call for Projects, MTA in the summer of 1995 approved the
allocation of millions of dollars in funding to support more than a hundred transit projects within
Los Angeles County. MTA Admission No. 50 (admitted). More than a dozen of these MTA-
selected-and-funded transit projects were designed and sponsored by the municipal operators,
while many other projects merely benefitted the municipal operators. The projects sponsored by
and/or benefitting the municipal operators were funded by MTA in an amount of more than $11
million. Transportation Improvement Program (TIP) Call for Projects Staff Recommendations,
at 35-76 (May 16, 1995), M322807 at M322841-82; Dep. o f Bob Cashin, at 67-70 (Oct. 2,
1995).
372. Several of the projects funded by MTA through its FY 1995-96 Call for Projects -
- involving police security and other security — resulted from a policy change by the MTA in the
winter/spring of 1995, a policy change which resulted in removing money from MTA bus -
operations. In previous years, MTA had programmed most or all of the Proposition C 5%
Transit Security funds to the MTA Transit Police. But, in the winter of 1995, the MTA Board
recommended that "in the 1995-96 Call for Projects" nearly $1 million — actually only
"$960,000" — "of Proposition C 5% security money be set aside to fund transit security proposals
from interested parties (excluding MTA)." Although the MTA staff reminded the MTA Board
that such action would reduce the MTA budget for MTA Transit Police for FY 1995-96 by
nearly $1 million and that "the MTA's budget deficit will increase by an equivalent amount," the
MTA Board nevertheless decided to take that nearly $1 million from MTA and to award it
instead to other transit operators. Call for Projects Ad Hoc Committee, Committee
Recommendation (Feb. 2, 1995), M323554 & M323555; Transportation Improvement Program
(TIP) Call for Projects Staff Recommendations, at 74-76 (May 16, 1995), M322807 at M322880-
82; Dep. o f Patricia McLaughlin, at 204-05 (Sept. 6, 1995) (Vol. 2); MTA Admission No. 51
(admitted "that, previously, a significant portion of the Proposition C 5% transit security funds
were programmed to the MTA Transit Police"); MTA Admission No. 52 (admitted that "in
February 1995, the MTA Board approved $960,000 of Proposition C 5% (Transit Security)
funds, for FY 1995-96 only, to be set aside for funding transit security proposals from interested
G:\mta\mediate\rg-bliss 131
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
agencies (excluding the MTA) on a competitive basis").
7. MTA Funds Not Just The Sixteen "Included"
And "Eligible" Municipal Bus Operators But
Other Bus Operators In Los Angeles County Too
373. MTA gives funding to other bus operators in addition to the 16 "included" and
"eligible" municipal operators, for example, to the Municipal Area Express (MAX), which
operates limited express bus service along two routes between the Palos Verdes Peninsula in the
South Bay and the employment district in El Segundo. MTA Admission No. 53 (admitted that
"the MTA gives funding to bus operators in addition to the 16 'included' and 'eligible' municipal
operators"); MAX Program Orientation, at 1-3 (Aug. 3, 1995), S0236-38; MAX 1st Class
Commuter's Guide (Aug. 2, 1993), S0240; MAX Policy Steering Committee Meeting, at Item III
A, Attachment I (Aug. 7, 1995), S0216 at S0232.
374. According to MAX: the targeted and "typical" rider of MAX is an "El Segundo
employee," "a professional or technical worker, 22-35 years old, with a household income of
over $50,000" per year; few of the riders on MAX pay the full fares as "most of the employers
subsidize the sale of MAX tickets and [monthly] passes to their employees"; MAX provides
"luxury commuter coaches" with "special commuter amenities" such as high-backed "airline style
seats that recline," overhead "reading lights," overhead parcel racks "for your briefcase or
parcels," and "year-round climate control"; MAX also offers underused/uncrowded coaches even
at peak hours as its ridership averages fewer than 12 riders per hour. MAX Program Orientation,
at 1-3 (Aug. 3, 1995), S023&38; MAX 1st Class Commuter's Guide (Aug. 2, 1993), S0240;
MAX Policy Steering Committee Meeting, at Item III A, Attachment I (Aug. 7, 1995), S0216 at
S0232; MTA Admission No. 55 (admitted that "MAX provides high-backed seats that recline,
reading lights, and parcel racks").
375. MAX service increased somewhat beginning in the summer of 1995 after the
MTA awarded it $404,727 in annual funding to extend one of its routes so as to provide feeder
services to the new rail station in El Segundo on the Metro Green Line. Through this funding,
in addition to other MTA funding, the MTA provided approximately 73 percent of the MAX
budget for FY 1995-96. MAX Policy Steering Committee Meeting, at Item II C and Attachment I
G:\mta\mediate\rg-bliss 132
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
(Aug. 7, 1995), S0216 at S0219, S0221; MTA Admission No. 56 (admitted "that, for FY 1995-
96, MTA awarded Torrance MAX $404,727 in CMAQ funds to operate the Green Line shuttle
service in El Segundo").
8. MTA, For FY 1995-96, Also Approved
The Expenditure By Local Jurisdictions Of
Millions Of Dollars Of Proposition A & C
Local Return Funds, Thus Providing Even More
Funds Benefitting The Municipal Bus Operators
376. Two final — and large - sources of funding for the municipal operators are the
MTA-administered Proposition A 25 Percent Local Return funds and the MTA-administered
Proposition C 20 Percent Local Return funds, local transit funds which together total well over
$150 million a year for MTA-approved transit projects. With regard to FY 1995-96, for
example, Proposition A Local Return funds were estimated by the MTA to be somewhat more
than $93.3 million, and Proposition C Local Return funds were estimated by the MTA to be
somewhat more than $76.6 million, for a total of nearly $170 million. The MTA allocates these
funds on a population basis to the 88 cities within Los Angeles County, and to the County itself
(with regard to the unincorporated portions of the County); MTA prior approval as to the
appropriateness of any proposed transit expenditure is required before jurisdictions can draw
down and spend the funds. Dep. of Patricia McLaughlin, at 139 (Sept. 6 , 1995) (Vol. 2); FY96
Bus Transit Fund Estimates & Revenue Allocations, at Tables 1-2 & 8 (March 21, 1995),
D109674 at D109675-76, D109686; MTA Short Range Transit Plan Fiscal Years 1996-99, at
Table 4-8 (June 2, 1995), M336444 at M336475-77; MTA Admission No. 57 (admitted "that the
municipalities in Los Angeles County receive Proposition A 25 Percent Local Return Funds and
Proposition C 20 Percent Local Return funds, and that MTA staff estimated that, in Fiscal Year
1995-96, approximately $93.3 million in Proposition A 25 Percent Local Return funds would be
available for distribution and approximately $76.6 million in Proposition C 20 Percent Local
Return funds would be available for distribution").
377. All 16 of the "included" and "eligible" municipal bus operators receive MTA-
approved direct allocations of Local Return funds from the jurisdictions they serve. Dep. of
Terry Matsumoto, at 55 (Sept. 18, 1995) (Vol.1); Proposition A (25%) and Proposition C (20%)
G:\mta\mediate\rg-bliss 133
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Local Return Program Approved Projects Report FY 1992-93, at 11, 16, 21 (July 26, 1993),
D116109 at D116119, D116124, D116129.
378. For example, in FY 1992-93 the MTA approved the direct allocation of Local
Return funds to the Antelope Valley Transit Authority from Lancaster in the amount of
$1,300,000, from Palmdale in the amount of $1,206,730, and from the County of Los Angeles in
the amount of $762,800. MTA Admission No. 58 (admitted).
379. Long Beach Transit has an agreement with the City of Long Beach pursuant to
which Long Beach Transit receives a direct allocation of approximately 70 percent of the
Proposition A Local Return funds received by the City of Long Beach. MTA Admission No. 59
(admitted). Long Beach Transit also has contractual agreements with the nine other cities it
serves for the direct allocation of Local Return funds from those cities. Per these agreements,
Long Beach Transit in FY 1995 received an MTA-approved direct allocation of Local Return
Funds in the amount of $3,289,919 from the City of Long Beach, and MTA-approved direct
allocations of Local Return funds totalling $189,000 from the other cities served. Long Beach
Transit Short Range Transit Plan FY 1996-1999, at 18-20 (undated), M705470 at M705488-90.
380. Torrance Transit in FY 1990-91 received from Torrance MTA-approved direct
allocations of Proposition A Ixtcal Return funds totaling $1,847,680 for capital expenditures, in
addition to MTA-approved direct allocations of Proposition A Local Return funds totaling
$927,899 for operating expenses. Torrance Transit Short Range Transit Plan FY 1992-1994, at
3, 4 3 .4 4 (March 1991), D116755 at D116761, D116801-02.
381. Of the 89 jurisdictions that are eligible to receive and spend Local Return funds,
with MTA approval, many do contribute Local Return funds to their local municipal bus
operators. For example, with regard to FY 1991-92, jurisdictions received MTA approval to
spend approximately $92 million of their Proposition A Local Return funds (Proposition C had
not then yet been implemented) to enhance the services of their municipal operators: $40.1
million on fixed-route transit, $12.2 million on commuter bus service, $2.1 million on transit
security, $13.0 million on bus fare subsidies, $1.9 million on bus stop improvements, $1.9
million on vehicle modifications, $4.8 million on vehicle purchases, $3.6 million on bus platform
G:\mta\mediate\rg-bliss 134
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
L
Suit* 200
installations/modifications, $1.8 million on adjacent park-and-ride parking lots, and $12.3 million
on transit facility improvements. Proposition A Local Return Program FY 1991-92 (Aug. 26,
1992), D116296; MTA Admission No. 61 (admitted "that cities receiving Local Return funds
contribute Local Return funds to municipal bus operators").
382. Apart from occasional contributions of Local Return funds to MTA bus
operations from the County of Los Angeles, and apart from some contractual payments of Local
Return funds for services rendered (such as the MTA's Hollywood Bowl bus service provided
under contract with the City of Los Angeles), MTA bus operations receive no allocation of
Proposition A Local Return funds or of Proposition C Local Return funds from any jurisdiction.
MTA Admission No. 62 (admitted); Dep. o f Terry Matsumoto, at 57, 70 (Sept. 18, 1995) (Vol.l).
VH. DEPARTURES FROM REGULARITY
383. MTA routinely departs from substantive public transit norms and from procedural
norms in managing its affairs, as discussed below.
A. MTA's Long Range Plans Are Economically
Unrealistic
384. MTA's financial and transportation planning matters have been guided by the old
30-Year Plan and the current 20-Year Plan. MTA adopted the old 30-Year Plan in 1992 and
jettisoned it almost immediately because it was economically unrealistic. The current 20-Year
Plan, which the MTA adopted in 1995, superseded the old 30-Year Plan. The 30-Year Plan
envisioned mass transit projects costing $183 billion over thirty years covering 250 miles of
freeway car-pool lanes, 4,200 new buses, 296 miles of new rail lines, and 200 miles of Metrolink
rail service. In contrast, the scaled-back 20-Year Plan — which was adopted just two years later
— covers fewer projects costing a claimed $72 billion over a twenty year period. Both Plans are
economically unrealistic and perpetuate MTA's discriminatory practices. See generally LACTC,
30-Year Integrated Transportation Plan (“30-Year Plan”) (April 1992), 014261; MTA, A Plan
for Los Angeles County: Transportation for the 21st Century (“20-Year Plan”) (March 1995),
M300452.
385. Then-CEO Franklin White conceded that the MTA's long range plans — the
135
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
abandoned 30-Year Plan and the current 20-Year Plan — do not satisfy the business or public
transit necessity standard and do not justify the MTA's discriminatory policies and practices. “I
think we need what I call a common sense transportation plan. And we didn' t have one with
[the old] $183 billion [30-Year Plan], And many people argue, some very persuasively, that we
d on 't have one now.” MTA, Transcript o f Franklin White's Comments Made In Open Session
Regarding His Performance Appraisal, December 20, 1995, Board Meeting, M80838I at
M808384. “The old plan I said had something for everybody. . . . It was not a plan that asked
as the first question, what is our transportation problem. It was a plan that said what do we need
to put in it to make various people happy so that we can get a vote for this plan.” Id. "We had
a plan that was going nowhere, and it didn' t deserve to go anywhere. There were parts of that
plan that should never see the light of day — even if you had the money to build it. It wouldn' t
be spending the taxpayers' money wisely.” Id. at M808394. According to Mr. White, the 30-
Year Plan was not economically realistic, the projections were not sound, the Plan was not
achievable, and the Plan was overly ambitious. Dep. o f Franklin White at 69-77, 81-83 (Oct. 27,
1995); A Vision for the MTA (undated), 957100; The Stakeholder (July, 1995), 957658.
386. The 20-Year Plan "still appears to contain significant uncertainty regarding
availability of funding, and if available, when." MTA, Arthur Andersen Final Report of
Recommendations, Vol. A, at 11-19 (April 24, 1995), D121959; accord, id. at V-16. According to
Linda Bohlinger, who was primarily responsible for drafting both the 30-Year Plan and the
financial model in the 20-Year Plan, the 20-Year Plan is no more economically realistic than the
30-Year Plan. Dep. o f Linda Bohlinger at 49 (Aug. 31, 1995) (Vol. 3).
1. The 30-Year Plan Was Totally Unrealistic
387. The 30-Year Plan was not economically realistic from the start. Dep. o f Gary
Spivack at 26 (Oct. 11, 1995). Mr. Spivack was manager of planning and public affairs at RTD
at the time the 30-Year Plan was adopted and his responsibilities included commenting on the
draft 30-Year Plan before it was adopted. Spivack is currently the acting manager of operations
planning at MTA. Id. at 8-11, 16-22, 32-33, and exhibits cited; Comments on 30-Year Plan
(undated), 10142; SCRTD 30-Year Plan (undated), 10221.
G:\mta\mediale\rg-bliss 136
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
388. MTA admitted just one year after the 30-Year Plan was adopted that there would
be a $20 billion shortfall over the life of the Plan because of the impact of the California
recession local sales tax revenues. MTA, Judith Wilson, Long Range Transportation Plan
Purpose, Work Plan and Methodology (March 7, 1993), M0280300, M0280301. The failure to
assess the potential for the economic recession is one of the key factors that caused the demise of
the 30-Year Plan. Id. at 25; 23-28; Dep. of Keith Killough at 42-50 (July 26, 1995) (Vol. 1).
The drafters of the 30-Year Plan did not attempt to assess the potential for an economic recession
before adopting the final plan. Staff members warned the drafters to do so, and the drafters
"certainly" could have done so. Dep. of Gary Spivack at 26 (Oct. 11, 1995).
389. "[T]he pattern of [the] 30-Year Plan [was] basically [to] provide[] everything for
everybody." Dep. of Keith Killough at 22 (July 26, 1995). "[T]he 30-Year Plan seemed to have
something for everybody." Dep. o f Franklin White at 81 (Oct. 27, 1995). "We were always
assured that the money was there [for the 30-year plan]," according to Los Angeles City
Councilman Richard Alatorre, MTA's former Chairman and present Board member. Los Angeles
Times (May 15, 1993), 801661 at 801663. But, as Mr. Alatorre realized: "The money is not
there." Id.
390. According to former MTA Board alternate and Finance Committee Chair Marvin
Holen, the 30-Year Plan launched the MTA on the path to bankruptcy. Nobody is willing to
defend the 30-Year Plan anymore. Dep. o f Marvin Holen at 39-41, 45 (Dec. 7, 1994). Tom
Rubin, the former Chief Financial Officer of MTA' s predecessor agency the RTD, warned then-
MTA CEO Franklin White in an internal memo in mid-1993 that the Plan's projections about rail
ridership were pure "Fantasyland," and recommended that the MTA "disown" the 30-Year Plan
because it was "badly flawed and worthless." MTA Memo from Tom Rubin re: Review of FY
1994 Budget (July 1, 1993), 011156.
391. The LACTC declined to prepare the 30-Year Plan as a joint document with the
RTD or to seek federal funding to prepare the Plan. Instead, the LACTC prepared the Plan itself
with local funding. Letter from Alan Pegg to Neil Peterson (Nov. 12, 1990), 009950; Letter
from Tom Rubin to Linda Bohlinger (Nov. 7, 1989), 009966.
G:\mta\mcdiatc\rg-bliss 137
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
392. According to the RTD's analysis of the draft 30-Year Plan, the Plan ignored non-
rail alternatives such as busways, contained "numerous questionable" assumptions, and presented
scenarios "that appear designed to make rail alternatives more attractive." RTD, Alan Pegg,
LACTC 30-Year Plan (March 5, 1991), 010018 at 010019-20.
393. The RTD criticized a draft of the 30-Year Plan because the LACTC
misrepresented costs and utilization of bus and other modes of transit, used questionable ridership
forecasts, failed to consider alternative such as busways, used inconsistent inflation assumptions,
failed to acknowledge lack of cost effectiveness of the 14 rail systems proposed, and used
questionable financial assumptions. RTD, Tom Rubin, Comments on August 26, 1991, Version of
LACTC 30-Year Plan (Sept. 8, 1991), 010180.
394. The RTD proposed a "Transit Now" alternative to the draft 30-Year Plan. The
principles of the alternative were:
• Recognition that bus service must be the key component of the future transit
system as it will carry the vast majority of transit riders and the majority of rail
passengers to and from rail lines.
• A consistently high level of service quality must be provided on both the rail and
bus systems.
• Safety levels, cleanliness standards, and loading (crowding) standards must be
comparable for all transit modes.
• Equity in the provision of the same quality, quantity, and types of service must be
a priority throughout the county.
With respect to equity principles, the RTD stated that: "Requiring that all rail and alternative
technology projects are cost-effective and efficient will help ensure that projects that are needed,
not just desired, will be built. It is also important to design bus systems for residents in all areas
of the region that are accessible, clean, convenient, fast, and safe." RTD, Alan Pegg, Consider
General Manager's Report Concerning a "Transit Now" Alternative to the LACTC's Draft 30-
Year Integrated Transportation Plan (Nov. 15, 1991), 008425 at 008427.
395. The 30-Year Plan assumed that the 1992 and 1994 state rail bond issues would be
G:\mta\mediate\rg-bliss 138
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
approved. LACTC, N. Peterson, Proposed 30-Year Integrated Transportation Plan (March 30,
1992), MO110041 at MO110049. They were not approved, thus weakening the financial
assumptions underlying the Plan.
396. The bus component of the 30-Year Plan proposed to increase the peak bus fleet
by approximately 1,700 buses by the year 2010. Approximately 65 percent of the increase was
proposed for the first ten years. LACTC, City o f Los Angeles Department o f City Planning and
City o f Los Angeles Department o f Transportation, Los Angeles Transportation/Land Use Policy,
Background Report (Dec. 1991), C000744 at C000797.
397. In 1994, the MTA circulated a copy of Peter Gordon & Harry Richardson,
Counterplan for Transportation in Southern California: Spend Less, Serve More, Reason
Foundation (Feb. 1994), M324043, along with a response, MTA, For the Record: A Practical
Approach to Providing Mobility For All Los Angeles County (May 1994), M324069. The -
Counterplan, written by two professors at the University of Southern California, including the
Dean of the School of Urban Regional Planning, offers an alternative to the MTA 30-Year Plan.
The Counterplan states in part:
Southern California politicians and transportation planners
have embarked on a course that can only end in disaster. With the
tempting lure of initial federal subsidies and the acquiescence of
deceived voters, they are building a transportation system that will
not work, that cannot work. Regardless of how low the fare
charged, regardless of how many competing but cost-effective bus
lines are closed down, regardless of how strong the efforts and
land-use zoning changes to force new development (both
residential and commercial) close to the stations, regardless of
what additional sacrifices we are forced to make to bridge the rail
budget shortfalls, this metropolitan region did not develop with a
spatial structure compatible with fixed rail. Nothing can change
tills. There is insufficient potential to cut door-to-door rail travel
G:\mta\mediate\rg-bliss 139
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
times for enough people either to reduce the ballooning subsidies
to manageable proportions or to relieve congestion on the highway
system. In other words, we are spending billions and billions for
minimal gains, if any. It is particularly ironic that lavish rail
spending is continuing in times of extreme fiscal penury. If we
consider the areas of public expenditure starved of resources (e.g.
education, criminal justice, affordable housing, community health),
and step back and look at the overall allocation of public fiscal
resources from the perspective of maximizing social welfare, the
scale of spending on rail not only appears irrational; it is
irresponsible.
Although it is too late to shout "Stop the train, we want to
get off!," this paper has outlined an alternative that can slow it
down. While it is inconceivable that federal monies will be
returned, and hence closing down the rail projects altogether will
not happen, we believe that limiting the Red Line to the
Downtown-North Hollywood link and stopping light rail after the
opening of the Green Line is a sensible strategy. The alternative
approach that we favor would cost far less, would improve the
mobility of millions rather than thousands (as a result of the
region-wide system of HOV/HOT lanes), would stimulate private-
sector transportation initiative (in the form of investment in shuttle
service), and generate substantial revenues for transportation and
other purposes. Further, it would preserve and expand (rather than
risk gutting) the bus system. And the favorable impacts on
congestion and air quality would be more substantial than under
the rail plan.
Counterplan, at M324067.
G:\mta\mcdiate\rg-bliss 140
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
398. According to the Counterplan:
The guaranteed failure of rail transit is not different to
explain. Even if the rail transit plans were implemented in their
entirety (a most unlikely outcome), the vast majority of the
region's population will live (or work) too far away from transit
steps to patronize the system. Of course, everybody could drive to
a station and park there to take the train, but modal transfers add
many minutes to door-to-door travel times (and still involve
pollution-inducing "cold starts"). Door-to-door travel time is the
major determinant of modal choice, and the decentralized spatial
structure of the Los Angeles region means that only door-to-door
travel modes (such as autos, taxis, and vans) are competitive for
most people.
Increased vehicle occupancy in door-to-door vehicles is
therefore the key to resolving the region's traffic congestion
problem. HOV lanes and transitways for buses, vanpools and
carpools would reduce these vehicles' trip times — a competitive
advantage.
Counterplan, at M324057.
2. The 20-Year Plan Also Is Economically Unrealistic
399. The MTA has trumpeted its 20-Year Plan, adopted by the MTA Board in March
1995, after the plaintiffs initiated this lawsuit, as a "well-defined vision for transportation in the
next two decades." Dep. o f Franklin White at 80 (Oct. 27, 1995). "A thorough understanding of
the 20-Year Plan is in order. It's a good idea to become familiar with it because it is what all of
our activities will be based on in the coming years." Id. at 81; see generally id. at 77-83; The
Stakeholder (July 1995), 957658.
a. The 20 Year-Plan Does Not Evaluate Rail Projects
That The MTA Board Had Already Approved
G:\mta\mediate\rg-bliss 141
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
400. By its own terms, the 20-Year Plan does not constitute a justification for or
validation of rail projects that the MTA Board had previously funded or approved, such as the
Pasadena Blue Line and the Metro Red Line. The Plan is premised on a "baseline" of projects
that the MTA had previously funded or approved. See, e.g., MTA 20-Year Plan, at 30-45
(March 5, 1995), M300452; MTA 20-Year Plan Technical Appendices, at 49-50 (March 5,
1995), M302623. The evaluative criteria used for other projects in the Plan were not applied to
the baseline projects. Dep. o f Keith Killough at 66-67 (July 26, 1995) (Vol. 1); Dep. o f Franklin
White at 40-41 (Oct. 27, 1995); Dep. o f Dana Woodbury at 507-12 (Aug. 18, 1995) (Vol. 4).
The Pasadena Line and Red Line extension projects are both included in the "baseline." MTA
20-Year Plan Technical Appendices, at 49-50 (March 5, 1995), M302623.
b. The Rail Projects In The 20-Year Plan Are Not
Cost-Effective Under The MTA's Own Measures
401. The 20-Year Plan purports to evaluate transit projects in terms of mobility, air
quality and cost effectiveness. See, e.g., MTA 20-Year Plan Technical Appendices, at 5-8
(March 5, 1995), M302623 at M302628-31; Dep. o f Keith Killough at 55-68 (July 26, 1995)
(Vol. 1). According to M TA's own measures of combined cost-effectiveness, mobility, and air
quality for all projects considered in the planning process, all the rail projects considered in the
Plan performed significantly worse than virtually every other transportation project in the Plan
(with the possible exception of bike lanes in some regards). MTA 20-Year Plan Technical
Appendices, at 20-21 (March 5, 1995), M302623 at M302643-44. Then-CEO Franklin White
was unable to explain this dramatically poor showing. Dep. o f Franklin White at 91-93 (Oct. 27,
1995). According to the MTA' s own Big Six accounting firm: "The MTA bases too few
decisions on factual cost/benefit analysis." MTA, Arthur Andersen Final Report o f
Recommendations, Vol. A, at VIII-3 (April 24, 1995), D121959; Thomas Rubin, Concerns about
the MTA Long Range Plan, at 1-3 (Oct. 25, 1995), E100596.
402. The poor performance of rail projects is echoed by MTA Board Members.
According to Los Angeles City Councilman, MTA Board Member and former MTA Chairman
Richard Alatorre, "we're spending too much money on Metrolink." Dep. o f Richard Alatorre at
G:\mta\mediate\rg-bliss 142
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
42 (Oct. 17, 1995). " It's not . . . helping the rider that . . . it should be helping, period." Id.
Transit dollars should be spent to help "[p]eople that pay the freight. You know, bus riders." Id.
at 43.
403. Similarly, according to MTA Board Member and Los Angeles County Supervisor
Michael Antonovich, the MTA 's subway and heavy rail projects are costly and disastrous. Dep.
o f Michael Antonovich at 9-10 (Oct. 16, 1995). According to Supervisor Antonovich: "It is time
for Congress to pull the plug on the Red Line subway construction in Los Angeles." Letter from
Michael Antonovich to Newt Gingrich (June 28, 1995), M806076. Subway and heavy rail
projects in Los Angeles are neither cost effective nor cost efficient, and they take money away
from transit projects that are both. Dep. o f Michael Antonovich at 54 (Oct. 16, 1995). The Red
Line rail project is a "pork barrel project," id. at 74, 77, "benefitting a few," id. at 77.
404. The original budget for the Pasadena Line - a light rail line - illustrates the.
runaway costs of MTA ' s rail projects. In 1995, outsider peer reviewers found that: "The current
budget for the Pasadena Line project is $67 million to $71 million per mile. This is without
precedent in the industry and does not appear to be warranted by the complexity of the project."
Peer Review Report for the Los Angeles County Metropolitan Transportation Authority:
Pasadena Blue Line (April 25, 1995), M323035 at M323047. The projected costs for the
Pasadena Line led then-CEO White to advise the MTA Board that the agency was bankrupt.
Dep. o f Franklin White at 42 (Oct. 27, 1995). The Pasadena Line is nevertheless one of the
"baseline" projects that was taken for granted and not evaluated in the MTA's 20-Year Long
Range Plan. Dep. o f Franklin White at 42 (Oct. 27, 1995); MTA 20-Year Plan, at 30-45 (March
5, 1995), M300452; MTA 20-Year Plan Technical Appendices, at 49-50 (March 5, 1995),
M302672.
405. Then-CEO White admitted that the Pasadena Line was an example of the "idiocy"
and "junk that didn't belong that got in [the long range plan] because of the political influence of
several of the [MTA board] members." MTA, Transcript o f Franklin White's Comments Made In
Open Session Regarding His Performance Appraisal, December 20, 1995 Board Meeting
(undated), M808381 at M808385.
G:\mta\mediate\rg-bliss 143
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
I thought frankly it was some kind of idiocy to talk about
commencing a multi-year construction period of Pasadena given
where we were. I thought it was self-evident that it didn' t make
sense. I got into a 3-month fight over Pasadena which delayed the
adoption of the budget, which ended in a way which was against
my better judgment, but I made enemies in that regard.
Id.
c. The Assumptions Concerning Federal Funding Set
Forth In The 20-Year Plan Are Just Plain Wrong
406. The 20-Year Plan is premised on unrealistic assumptions regarding billions of
dollars of federal funding. The results of the federal elections in November 1994 had profound
implications for the future of federal funding. "[Yjou're going to have greater accountability and
justification for projects that are - that had been funded in the past." Dep. o f Michael
Antonovich at 71 (Oct. 16, 1995). Prudent planning could have anticipated major cutbacks in
federal funding for public transit in Los Angeles before the 20-Year Plan was adopted in March
1995. The planners at the MTA failed to adjust to the reality of federal cutbacks. "They're still
in shock." Id. at 73.
407. If the proposed cutbacks in federal funding are implemented, "Our 20-Year Plan
as we know it now would be history." Dep. o f Franklin White at 100 (Oct. 27, 1995); Press
Release (May 24, 1995), M300264 at M300269; Thomas Rubin, Concerns About the MTA Long
Range Plan, at 33-36, 117-121, 137 (Oct. 25, 1995), E100596. The 20-Year Plan did not
adequately take into consideration the implications of cutbacks in federal funding which had been
evident since the federal elections in November of 1994. Dep. o f Linda Bohlinger at 50-57
(Aug. 7, 1995) (Vol. 2); id. at 69-107 (Aug. 31, 1995) (Vol. 3); id. at 250-58 (Sept. 12, 1995)
(Vol. 4); id. at 6-32 (Oct. 12, 1995) (Vol. 7); Memo from Barry Engelberg to MTA Executive
Management Committee re: Federal Legislative Update (March 31, 1995), M337921-43; Memo
from Arthur Sohikian to MTA Board (May 12, 1995) D121613-24; Dep. o f Franklin White at 93-
103 (Oct. 27, 1995).
G:\mta\mediate\rg-bliss 144
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
408. In a 1995 memo to the MTA Board concerning the impact of proposed federal
cutbacks, now-CEO Joseph Drew misstated the potential federal loss. Mr. Drew materially stated
the potential federal loss as a total of $40.6 million over three to five years. Applying the
MTA's and Mr. Drew's own assumptions, the correct amount was a total of $121.8 million to
$203.0 million over three to five years. The correct computation is $40.6 million each year
times three to five years, not $40.6 million divided over three to five years. Compare MTA
20-Year Plan (March 5, 1995), M300452 at M300573, with Memo to MTA Board from Joseph
Drew re: Summary of Impacts o f Proposed Federal Transportation Cutbacks (May 24, 1994 [sic;
correct year is 1995]), M300264 at M300266; Dep. o f Franklin White at 97-99 (Oct. 27, 1995).
409. In its comments on the MTA's draft 20-Year Plan, the Southern California
Association of Governments (SCAG) noted its concern about the MTA's financial assumptions:
We are also concerned about several of the LACMTA financial
assumptions given recent indications from Washington. For
example, the statement that the current operating deficit will be
resolved is left rather vague, and it is unclear how that will be
accomplished. As you are aware, approval of the 1993-97
Regional Transportation Improvement Program was made by FT A
and FHWA after the LACMTA Board adopted a series of steps
they would take to erase the previous $126 million deficit. Recent
federal court action may require the LACMTA to re-evaluate the
deficit elimination strategies and should be considered in the 20-
Year Plan. . . . The current RTP [Regional Transportation Plan]
financial plan made assumptions about finance (e.g. State board
measures) that have already failed to materialize and we expect to
have to give significant attention to that portion of the RTP
amendment.
Letter from Mark Pisano, SCAG Executive Director, to Franklin White, MTA CEO (March 17,
1995) (ellipsis and brackets added), M323133 at M323136. The MTA did not eliminate or even
G:\mta\mediatc\rg-bliss 145
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
address these problems in the adopted 20-Year Plan. Dep. o f Linda Bohlinger at 281-96, 310-16
(Sept. 21, 1995) (Vol. 5); compare Letter from Mark Pisano, SCAG Executive Director, to
Franklin White, MTA CEO (March 17, 1995), M323133, with MTA 20-Year Plan (March 5,
1995), M300452 at M300472; MTA 20-Year Plan Staff Recommendation (March 5, 1995),
M300601 at M300617; FY 1996 MTA Budget, D121611.
d. The 20-Year Plan Is Internally Inconsistent, And It
Misstates Costs And Revenues By Billions Of Dollars
410. The 20-Year Plan misstates by up to four billion dollars the projected revenues
that will be available to MTA over the next twenty years, even assuming the underlying accuracy
of its projections. The 20-Year Plan states projected sales tax revenues to be $33 billion at page
10, $34 billion at page 96, and $30 billion at page 104. MTA 20-Year Plan, at 10, 96, 104
(March 5, 1995); M300452 at M300473, M300559, M300567. In sworn deposition testimony,
the MTA official responsible for the financial sections of the 20-Year Plan could give no
explanation for these discrepancies. Dep. of Linda Bohlinger 375-76 (Sept. 21, 1995) (Vol. 5).
Then-CEO Franklin White, in his sworn deposition testimony, similarly could find no explanation
for these discrepancies. Dep. o f Franklin White at 84-87 (Oct. 27, 1995). If the higher figure is
accurate, there would be more money to fund the needs of the transit dependent. If the lower
figure is accurate, there would be less money to fund transit projects.
411. The 20-Year Plan misstates by some five billion dollars the costs associated with
the Plan. The Plan included as part of the costs of the Plan some $5 billion in costs incurred
before the period covered by the Plan. MTA 20-Year Plan, at 102-103 (March 5, 1995),
M300452 at M300565-66; Dep. of Franklin White at 87-89 (Oct. 27, 1995); Dep. o f Linda
Bohlinger 363-68, 372-74 (Sept. 21, 1995) (Vol. 5); Response to Peskin Report by Tom Rubin, at
72-84 (Jan. 1, 1996), E100061. These discrepancies reflect billions of dollars that could be used
to fund the needs of the transit dependent.
e. The 20-Year Plan Embraces Two Inconsistent
Assumptions Concerning Population Growth
412. The 20-Year Plan simultaneously embraces two dramatically inconsistent
assumptions concerning population growth. On the one hand, the Plan assumes a high 33.4
G:\mta\mediate\rg-bliss 146
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
percent population growth in the Los Angeles area between 1990 and 2015 in projecting transit
demands by using the SCAG population forecast. On the other hand, the Plan assumes a low 19
percent population growth in projecting revenues by using the lower UCLA population forecast
to project sales tax revenues from Propositions A and C and revenues from the California
Transportation Development Act. The SCAG forecast is 76 percent higher than the UCLA
forecast. Thomas Rubin, Concerns About the MTA Long Range Plan, at 75-79 (Oct. 25, 1995),
E100596; Memo from SCAG re: UCLA v. SCAG Population Forecasts (Oct. 13, 1994),
M1001730; MTA, Memo from Chip Conway to Keith Killogh re Population Growth in L.A.
County and the MTA’s Long Range Transportation Plan (Oct. 3, 1994), M1001732.
413. If the higher population forecast does not materialize, the projected transit
demands would not materialize. Dep. of Keith Killough at 21 (Oct. 3, 1995) (Vol. 2). The MTA
could achieve cost savings as a result to free up money to serve the needs of the transit
dependent. On the other hand, if the higher population forecast does materialize, then actual
revenues will be higher than projected revenues. This would increase the money available to
serve the needs of the transit dependent. Id. The MTA has confidence in the UCLA forecast
because it is "conservative . . . cautious . . . reasonable . . . prudent." Dep. o f Franklin White at
76 (Oct. 27, 1995); see also Dep. of Linda Bohlinger at 321-22, 336 (Sept. 21, 1995) (Vol. 5).
In contrast, relying on the SCAG forecasts “makes us sound like a bunch of mindless
bureacrats.” MTA, Memo from Judy Wilson to Keith Killough re Mayor Riordan’s Chief o f Staff,
Bill Ouchi, Questions SCAG Forecasts (Sept. 29, 1994), M1001765.
414. Then-MTA CEO White testified at his deposition that he had "no idea" that the
Plan was premised on two different population forecasts. Dep. o f Franklin White at 106 (Oct.
27, 1995). He said that no one had ever brought this to his attention. Id. at 105-09. In fact,
SCAG brought the problem to his attention before the MTA adopted the 20-Year Plan. See
Memo from SCAG re: UCLA v. SCAG Population Forecasts (Oct. 13, 1994), M1001730. Linda
Bohlinger, the person responsible for the financial model used in the 20-Year Plan, knew that the
inconsistent population figures were a problem but did not know how it was resolved. Dep. o f
Linda Bohlinger at 355-56 (Sept. 21, 1995) (Vol. 5). Keith Killough, the person responsible for
G:\mta\mcdiate\rg-bliss 147
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
the transportation model used in the 20-Year Plan, was aware of the mutually exclusive
population forecasts. Memo from SCAG re UCLA v. SC AG Population Forecasts (Oct. 13,
1994), M1001730; MTA, Memo from Chip Conway to Keith Killogh re Population Growth in
L.A. County and the MTA’s Long Range Transportation Plan (Oct. 3, 1994), M1001732. He did
not correct the problem. He could only explain that: "We went with the assumptions we went
with, and that's what the plan is based on." Dep. o f Keith Killough at 26 (Oct. 3, 1995) (Vol. 2).
f. The 20-Year Plan Does Not At All Address The
Needs Of Minority Transit-Dependent Bus Riders
415. Then-CEO Franklin White testified that whatever plan there is to meet the needs
of the transit dependent is in the 20-Year Plan, and if it is not in the Plan, the MTA does not
have any such plan. Dep. o f Franklin White at 17 (Oct. 27, 1995).
416. The 20-Year Plan fails to identify the needs of minority riders and to devise
effective strategies to meet those needs. "Race and ethnicity is not considered when we're doing
the plan." Dep. o f Keith Killough at 41 (Oct. 3, 1995) (Vol. 2). MTA does not gear its policies
and practices to evaluate, or to enhance, the mobility needs of minority bus riders. Dep. of
Marvin Holen at 120-21 (Dec. 7, 1994). The 20-Year Plan does not discuss who uses MTA
services, what their needs are, or how best to meet those needs.
417. The comments of the Southern California Association of Governments (SCAG)
on the 20-Year plan included the statement that: "The LACMTA emphasis on longer trips and
higher capacity transit vehicles seems contrary to observed travel behavior which is comprised of
shorter distance and centers oriented trips." Letter from Mark Pisano, SCAG Executive Director,
to Franklin White, MTA CEO (March 17, 1995), M323133 at M323135.
418. The 20-Year Plan allocates $530 million, or 9.8 percent of the available
Proposition C 40 Percent Discretionary funding to bus operations and capital over the entire
period of the 20-Year Plan. In contrast, $4.4 billion, or 81 percent of the total, is allocated to
rail. Bus is actually "losing money" in the Plan allocations. Thomas Rubin, Concerns About the
MTA Long Range Plan, at 139-42 (Oct. 25, 1995), E100596; MTA 20-Year Plan, at 104 (March
5, 1995), M300567. In its 20-Year Plan, the MTA did not evaluate reasonable alternatives for
G:\mta\mcdiate\rg-bliss 148
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
rail lines, or even note that such alternatives exist. Thomas Rubin, Concerns About the MTA
Long Range Plan, at 171-72 (Oct. 25, 1995), E100596\ MTA 20-Year Plan Technical
Appendices, at 104 (March 5, 1995), M302623 at M302636.
419. The 20-Year Plan does not address funding disparities between MTA bus
operations and the other municipal operators or seek to redress them.
B. MTA's Board of Elected Public Officials
Has Politicized Transportation Allocations
1. According To Then-CEO Franklin White, MTA’s Discretionary
Dollars Should Be Used To Make The Bus System Better
420. Former MTA CEO Franklin White characterized MTA as a “money train”:
From the moment I arrived I think one of the persistent rumors
that I received was, "things aren't straight over at the MTA."
Everbody I met would say that. People did not, and many do not
believe, that the way we make decisions is fair. They believe
insiders have a track. They believe this is a money train; and to a
large degree it is. It is a money train. And they believe that
favored friends have ways of climbing aboard that money train,
and that's true. One of the things that used to infuriate me when I
arrived . . . one of the reasons I recommended the elimination of
the RCC . . . was because I was fed up of hearing on the street
what the decisions were going to be that were going to be made a
the RCC the next week. It was sickening, and that's why people
believed that there was a fix in.
MTA, Transcript o f Franklin White's Comments Made in Open Session Regarding His
Performance Appraisal, December 20, 1995 Board Meeting, at 7-8 (ellipses added), M808381 at
M808387-88.
421. MTA fired Mr. White in December 1995. Mr. White explained his termination as
CEO in the following terms:
This is a money train and if you get between the people who want
G:\mta\mcdiate\rg-bliss 149
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
the money or the people who spend the money and the conductor,
you've got problems. I got in front of a lot of those situations,
and that in part explains why we're here today.
Id. at M808396.
422. Mr. White said that the LACTC 30-Year Plan, which proposed "a rail line
virtually in every district of every member [who] voted on the LACTC," reflected the fact that
the MTA and LACTC Boards consisted of "elected officials having their own individual
agendas."
[The MTA Board] is largely made up of . . . and I know this will
be understood . . . elected officials, and an enormously large board
. . . elected officials having their own individual agendas, with
everybody wanting to have this organization produce for them
something that will be good for them in their next election. That's
what any CEO faces. That's why the last long-range plan was
$183 billion. That's why the last plan had a rail line virtually in
every district of every member [who] voted on the LACTC.
That's why when the plan was examined later on, everybody
recognized it had something for everybody, but it was not a plan
developed from the bottom up. So what you need is a CEO,
whether Frank White or someone else, who's going to tell Board
members something they may not want to hear; and I have done
probably six things that I can think of, some of them I'm going to
recite in this meeting, which were not welcomed by individual
Board member or groups of Board members.
Id. At M808383 (brackets and ellipses added).
2. According to Supervisor Yaroslavsky, People
"In And Outside The Agency . . . Consider The MTA’s
Tax-Funded Coffers As Their Personal Candy Jars"__
423. In early December 1995, County Supervisor and MTA Board member Zev
G:\mta\mediate\rg-bliss 150
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Yaroslavsky sent a letter concerning the MTA's way of doing business to MTA Board Chairman
Larry Zarian and to all other MTA Board members. According to Supervisor Yaroslavsky,
people "in and outside the agency . . . consider the MTA’s tax-funded coffers as their personal
candy jars."
M808366.
424.
Letter from Zev Yaroslavsky to Larry Zarian, at 3 (Dec. 7, 1995), M808364 at
Supervisor Yaroslavsky also stated in his letter the following:
This open letter constitutes an appeal to the Agency and its
Directors to come to their senses and put a stop to the incessant
backbiting, backstabbing and conflict which has characterized our
Board’s way of doing business in general, and the relationship of
some members with the CEO in particular.
It’s time to call them as we see them! The campaign
against Franklin White is not about sinkholes and mismanagement;
it is about ridding this agency of the one man who has had the
courage to tell the truth and stand up to Board members,
contractors and their lobbyist when the integrity of the agency and
the interests of the taxpaying public have been at stake.
This effort is not new; it’s been going on for over two
years. It’s been orchestrated by a cadre of Board members and
outside lobbyists who want a lap dog for a CEO. Make no
mistake: these efforts are aimed a replacing this CEO with a “yes”
man who will do as he is told — regardless of the ethnical or
financial implications.
* * *
His efforts to replace the professionally bankrupt Rail Construction
Corporation with a structure that would better manage our
construction program and keep the agency accountable were
resisted for over a year by members of this Board. His opposition
G:\mta\mediatc\rg-bliss 151
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
to the $1.2 billion Electric Trolley Bus boondoggle earned him the
permanent enmity of contractors, lobbyists and their supporters on
this Board. His determination to inject a dose of fiscal reality into
the affairs of this agency by cautioning the Board on the number
and pace of rail construction projects has similarly alienated
contractors and their Board supporters.
★ ★ ★
The MTA’s problem is not its CEO; its problem is us. As
the Arthur Andersen report on MTA construction practices noted,
“too many of the decisions, both big and small, that decide the
fate of Los Angeles’ future rail transit system are the result of a
politically charged versus fact-based decision making process.”
* * *
Arthur Andersen warned that for the good of the agency, the
Board should “take steps to limit the political influence in Board
decisions."
Letter from Zev Yaroslavsky to Larry Zarian, at 1-3 (Dec. 7, 1995), M808364-66.
3. According To Mayor Riordan, The MTA Board Has
Inherent Conflicts That Make It Impossible For MTA
To Meet The Needs Of The People Of Los Angeles
425. MTA Board member and City of Los Angeles Mayor Richard Riordan
condemned the conflicts that are inherent in the structure of MTA’s current board, which consists
of elected local officials According to Mayor Riordan : "Quite simply, it's impossible to expect
that the current MTA structure can engage in the largest public works project in the country,
operate the largest bus fleet west of the Mississippi and still create innovative transportation
policy which meets the needs of the people of Los Angeles." The Mayor stated that he would
seek the introduction of state legislation to replace the present MTA Board of elected officials
with a nine-member appointed board with no elected officials or alternates. Mayor Riordan
stated that "[a]n appointed Board of non-elected officials would be liberated from the inherent
G : \mta\mediate\rg -bl iss 152
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
conflicts faced by politicians as they juggle the interests of multiple contituencies." Letter from
City o f Los Angeles Mayor Riordan to MTA Chairman Larry Zarian (Aug. 17, 1995), M802141
at M802141-42.
426. Mayor Riordan's proposal to restructure the MTA Board was introduced in the
California Legislature by Assemblyman Kuykendall on September 11, 1995. According to the
Mayor: "This legislation will create a much more efficient decision-making structure that
removes many of the biases associated with having elected officials on the board." According to
Assemblyman Kuykendall: "The MTA has been plagued by competing political interests, all at
the expense of a coordinated and strategic regional approach to transportation. . . . This new
structure removes individual constituent agendas, removes the perception of political favors, and
removes the ability of politicians to use MTA projects as leverage points in negotiations on other
political issues." Office o f Los Angeles Mayor Richard Riordan, Mayor Hails Assembly Bill 273
to Restructure MTA Board (Sept. 11, 1995) (with attachment entitled "Amendments to Assembly
Bill No. 273," M803136), M803135.
C. Irregularities Have Marked MTA's
Development Of Its Rail Program
427. In choosing to proceed with the Long Beach Blue Line, the LACTC rejected a
"bus alternative" calling for adding 33 conventional 40-foot buses or 24 articulated 60-foot buses.
The Long Beach - Los Angeles Rail Transit Project, Draft Environmental Impact Report (May,
1984), M305837 at M306450.
428. LACTC found only "very slight" differences between bus and rail on the bases of
local impact or regional transportation impact. The bus alternative had small or insignificant
noise impact, no adverse visual impacts, and positive impact on traffic and transportation. The
Long Beach - Los Angeles Project, Draft Environmental Impact Report (May, 1984), M305837 at
M306439, M306442-47, M306450.
429. According to LACTC, the principal impact of the bus alternative would be "to
improve service and accessibility in the corridor."
Its major population effect would be to improve service and
G:\mta\mediate\rg-bliss 153
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
accessibility in the corridor. The Bus alternative in the Los
Angeles segment would follow the 9th Street/Olympic corridor and
then turn north along either Broadway or Spring Street to Union
Station. This route would provide access to major employment
and activity centers, such as the flower and produce markets, the
garment district, the Civic Center core, and Union Station. While
it would not serve the office center on the west side of downtown
Los Angeles, its more direct route to Union Station would result in
better time savings for long distance commutes, relative to existing
service. The route in the mid-corridor would parallel the rail
transit alternative and would provide opportunities to enhance
accessibility to a slightly different set of activity centers, as
described in Section 251 of this chapter. Within the Long Beach
segment, the Bus alternative would be similar to light rail
alternative LB-2 without service to Atlantic Avenue. The route
would offer a direct connection to the regional shopping center
and to the Transit Mall on 1st Street.
The Long Beach - Los Angeles Rail Transit Project, Final Environmental Impact Report (March,
1985), M306934 at M307104. In the mid-corridor segment between downtown Los Angeles and
Long Beach, the bus alternative had twice the number of stops as the Long Beach Blue Line. Id.
430. The Long Beach Blue Line's projected capital cost of $407 million was over 65
times the $6 million projected capital cost of the bus alternative. The actual capital cost of $877
million for the Long Beach Blue Line is 146 times the $6 million projected capital cost of the
bus alternative. The Blue Line's projected annual operating cost of $13 million was over six
times the $2 million projected operating cost of the bus alternative. The Long Beach - Los
Angeles Rail Transit Project, Draft Environmental Cal Impact Report (May 1984), M305837 at
M306434.
431. During consideration of the environment impact report, the City of Los Angeles
G:\mta\mediate\rg-bliss 154
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Planning Department concluded that "[t]he bus alternative seems to negate the necessity of a
fixed rail system in this location." The Long Beach - Los Angeles Rail Transit Project, Final
Environmental Impact Report (March, 1985), M306934 at M307205.
432. In fiscal year 1992, the total MTA capital and operating subsidy to operate the
Long Beach Blue Line was $128 million; the Blue Line that year provided service to 11,300,000
passengers or 101,800,000 passenger miles. MTA in the same year provided the a total subsidy
in the same amount of $128 million to 17 of the busiest MTA bus lines. The 17 bus lines
carried 183,600,000 passengers and provided 549,700,000 passenger-miles of service, 16 times
the number of passengers the Long Beach Blue Line carried, and more than five times the
passenger miles than the Long Beach Blue Line. The 17 bus lines carried almost half of the total
county wide bus passengers. MTA, A Look At The MTA (Jan., 1994), 800042A at 800087A-90A;
Testimony o f Martin Wachs.
433. The subsidy per passenger for the 204 Line was $.34 in 1992. The Long Beach
Blue Line subsidy was $11.30, or 33 times more than the Line 204 subsidy. While the Long
Beach Blue Line carried 11.3 million people during FY 1992, the 204 Line carried 18.0 million
people in the same period or 60 percent more than the Long Beach Blue Line. The 204 Line
had a 150 percent higher carrying capacity per route mile than did the Long Beach Blue Line.
All told, each of the six bus lines had a greater average weekday ridership than the Long Beach
Blue Line, notwithstanding service reductions that reduced bus ridership. RTD, Tom Rubin, Line
204 Subsidy Per Passenger (Oct. 30, 1992), 010928 at 010928-29.
434. In FY 1992, RTD calculated that it spent a total of $4.9 million for fare collection
processing costs on the Long Beach Blue Line. In the same period RTD collected only $4.1
million through the Long Beach Line's automated ticket vending machines. The fare collecting
costs were 20 percent more than the amount collected. RTD, Tom Rubin, Blue Line Fare
Collection Costs (Feb. 16, 1993), 010991.
435. According to the RTD:
The emphasis for building the Blue Line was to build a rail
line, somewhere in the County, as fast as possible to justify to the
G:\mta\mediate\rg-bliss 155
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
voters the sales tax that they approved. The Blue Line was chosen
because there was an existing rail right of way that could be
obtained relatively quickly. However, many of the stations don't
really serve anything — there are not any commercial, government,
or residential clusters nearby. This is particularly true in mid-
corridor. In other words, once you get on the Blue Line at one
end or the other, you aren't going to be getting off to go to some
destination in the middle, other than your home, which you will
need to transfer to another mode to reach.
RTD, T. Rubin, Letter to Eric Bierce, Honolulu Office o f Mass Transit (Sept. 11, 1992), 010680
at 010686.
436. Prior to the opening of the Long Beach Blue Line, RTD projected that the use of
a flat fare would produce an average daily ridership of 30,386 one year after opening. The Blue
Line achieved that ridership after one year. The same model, however, predicted ridership of
only 14,432 for a zone fare equivalent to that used on the bus system, which was higher than the
flat fare. It thus appears that the lower flat fare alone was responsible for 53 percent of the Long
Beach Blue Line ridership. Tom Rubin, Response "For the Record” (June 10, 1994), 011736 at
011761.
437. A large number of Long Beach Blue Line riders chose it for one or more of the
following reasons: their former bus lines were cancelled, the Long Beach Line fare was less than
half of their former express bus line fare, the Long Beach Line offered a considerably faster ride
than their former local bus line at the same cost, and the Blue Line fares were so low that riders
were tempted out of their cars. Id. at 011761.
438. Line 456 was an express bus line that ran on top of the Long Beach Blue Line
south of Willow and then ran to downtown Los Angeles via the Long Beach Freeway. It took
approximately 52 minutes to make the trip at peak. As an express line, the cash fare for Line
456 was $2.70 and the monthly pass was $90. Id. at 011759.
439. A year after the opening of the Long Beach Blue Line, Line 456 was cancelled
G:\mta\mcdiate\rg-bliss 156
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
and most of the original 2,500-3,000 average weekday riders transferred to the Blue Line. The
travel time increased, although the fare decreased by 53 percent. Id. at 011760.
440. An RTD analysis estimated that the cost of building and operating the Long
Beach Blue Line for 30 years was equivalent to operating 470 buses for 33 years (including the
cost of building the operating divisions to support the new buses). These buses would produce
almost four times as many passenger miles and almost nine times as many passengers. The
capital costs of rail are almost four time higher than bus (when the time value of money is
considered) and over 30 times as high per passenger and procedures operating costs per
passenger mile that are almost twice as high. RTD, T. Rubin, Bus v. Rail Costs (Sept. 4, 1991),
009934 at 009935, 009944.
441. MTA proceeded with the Long Beach Blue Line construction notwithstanding the
parallel construction of the 10 mile Harbor Freeway Busway from Adams Boulevard to the-
Artesia Freeway. The Busway is estimated to save 20 minutes commuting time from San Pedro
to downtown Los Angeles. Metro Bus System Workshop MTA, Special Projects: Harbor
Transitway (Sept. 14, 1995), M803 782 at M803799. "This busway will significantly reduce the
travel time from the southern part of the County to Downtown Los Angeles over that of the
Long Beach Line. The [MTA's] transportation model predicts a shift of 20% of the current Long
Beach Line ridership to busway bus routes, assuming that buses are added to meet demand at
existing [MTA] service quality standards." MTA, A Look At The MTA (Jan. 1994), 800042A at
800096A.
442. MTA constructed the Long Beach Blue Line "at grade most of the way." Dep. of
Richard Stanger at 100 (July 27, 1995) (Vol. 1). Virtually all of the Blue Line street crossings
in the 16-mile mid-corridor portions of the Blue Line, where trains travel at up to 55 miles per
hour, are at grade.
443. MTA recognized that: "In the [Metro Blue Line's] mid-corridor section, the trains
have been moving at high speeds and the accidents have resulted in fatalities and serious
injuries." MTA, Board Recommendation, Endorsement o f the Metro Blue Line Grade Crossing
Safety Improvement Program (Jan. 7, 1992), 013997.
G:\mla\mediate\rg-bliss 157
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
444. Overall, there are three ways to construct rail lines at street intersections. "[Y]ou
can cross a street under, on, or over the street. In very built-up areas you have to almost — you
have to go under," although "in certain instances you have to fly over." Dep. o f Richard Stanger
at 89 (July 27, 1995) (Vol. 1) (brackets added). The costs of these three different alternatives
vary considerably. "The least expensive way of building a rail line is on the surface. It costs
about three times as much to build an aerial structure. It costs about anywhere from 10 to 20 as
much to build a subway." Id. at 100.
445. Even apart from industry standards as to population density, building rail lines at
grade - where trains cross street intersections on the surface - is inherently dangerous. Even
MTA admits this: "Non-grade separated rail systems are inherently more dangerous than grade-
separated rail, most bus systems, and almost every other known transit mode." MTA, A Look At
The MTA (Jan., 1994), 800042A at 800103A. Fortunately, industry standards dictate that rail
lines not constructed at grade in populated areas. As summarized by the MTA's Richard Stanger,
currently the Executive Director of Metrolink/SCRRA, and formerly the Director of Rail
Development at the MTA (LACTC) in the 1980s during the planning and preliminary
engineering of the Blue Line, Dep. o f Richard Stanger at 7, 84, 86-87 (July 27, 1995) (Vol. 1),
there is an industry standard as to population density: "There's a general standard that the
density be certainly below 5,000 per square mile and more like two or 3,000 per square mile."
Id. at 128-29 (emphasis added).
446. Disregarding and directly violating this industry standard — given that the MTA
knew that the population "density along the Long Beach Blue Line is about 5,000 per square
mile," Dep. o f Richard Stanger at 129 (July 27, 1995) (Vol. 1) - the MTA opted for the least
expensive and most dangerous of the three alternatives by building the Blue Line at grade
throughout virtually all of this heavily-populated 16-mile mid-corridor.
447. The residential population along and adjacent to this 16-mile mid-corridor portion
of the Long Beach Blue Line was and is more than 95 percent minority.
448. RTD reported that in its first three years of operation, the Long Beach Blue Line
had 15 fatalities for an average of five a year. In FY 1993, Long Beach Line had eight fatalities.
G:\mta\mcdiatc\rg-bliss 158
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
All light rail transit operators in the United States reported seven fatalities in 1990. The Long
Beach Line had the worst fatality record on four out of five types of data and measures; it was
second worst on the fatalities per million passenger miles criterion. RTD, Tom Rubin, Blue Line
and National Light Rail Safety Statistics (July 26, 1993), 011290 at 011293-94.
449. There were 30 fatalities along the Long Beach Blue Line corridor from 1990,
when the Blue Line opened, up to late 1995. Most of the fatalities occurred in the minority mid-
corridor, as have most of the major injuries. Dep. o f Louis Hubaud at 57-58 (Oct. 6 , 1995);
MTA, A Look At The MTA (Jan., 1994), 800042A at 800103A-04A. In FY 1992, "the best safety
year the Blue Line has had," the Long Beach Blue Blue Line's safety record measured by
boardings-per-fatality was almost ten times the national average for light rail lines. Id. at
800103A.
450. "We continue to experience slightly more than one train vs. automobile collision
per week. To date, Long Beach Line collisions have destroyed one car each from the Los
Angeles Police Department, Long Beach Police Department, and the Los Angeles Sheriffs
Department." SCRRA, Endorsement o f the Metro Blue Line Guide Crossing Safety Improvement
Program (Jan. 7, 1992), 013997. As of January 7, 1992, 126 train/auto and 20 train/pedestrian
collisions resulted in 12 fatalities and numerous injuries. "[I]n the [Blue Line's] mid-corridor
section the trains have been moving at high speeds and the accidents have resulted in fatalities
and serious injuries." Id. See also MTA Metro Blue Line Grade Crossing Incident Status
(March, 1995) (257 more accidents from 1993-March, 1995), M322253-54.
451. In 1992, the Los Angeles County Board of Supervisors requested MTA to study
the need for grade separations on surface streets along the Long Beach Blue Line route. MTA
reported that placement of grade separated rail crossings in the 16 mile long mid-corridor
segment of the Blue Line would cost $277 million. Rail over road separations at seven major
streets would cost $84 million. MTA staff recommended that neither expense be incurred "due
to the degree of benefits expected relative to the cost, the construction and land use impacts, and
the financial impacts on other transportation programs/projects throughout the county," notably
“significantly] delay of other rail projects in the 30-Year Plan." MTA, Metro Blue Line Grade
G:\mta\mediatc\rg-bliss 159
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Separation Study Requested by Board of Supervisors (Nov. 18, 1992), M0340001-02. Instead,
the MTA has opted to install quad-gates, cameras, and other low-cost warning safety devices and
barriers. Id. To date, very few devices or barriers in fact have been installed in the mid-
corridor. Dep. o f Louis Hubaud at 40 (Oct. 6 , 1995).
452. In contrast, Metrolink, which generally operates in less populated, predominantly
white population areas, is pursuing a program to construct grade-separated crossings in response
to similar safety concerns. SCRRA, Grade-Crossing Policy Resolution (Aug. 9, 1991), M0070016
at M0070019. "The Southern California Regional Rail Authority shall support and promote the
elimination of rail-highway grade crossings to the extent feasible through support of the
following actions: a) Close existing grade crossings where possible, b) Participation in the
construction of grade separations where appropriate, c) Participation in the construction of
highways and/or railroads where appropriate, d) Establish no new crossings at grade."
Metrolink also resolved to install warning devices. Id.
453. Although MTA rejected constructing grade separations in the minority inner city
along the Long Beach Blue Line on the grounds that the grade separations would be too
expensive, MTA nevertheless has helped to finance the elimination of at-grade crossings in
Metrolink commuter rail corridors. See, e.g., MTA, Funding the MTA/Metrolink Match for the
Ramona Grade Sepatation Project (Dec. 29, 1993), M0250019.
454. Illustrative is MTA's response to a potentially-dangerous at-grade crossing along
the Metrolink rail tracks in Van Nuys, a crossing connecting Willis Avenue and Raymer Street.
As explained by Metrolink's Executive Director, "this is a place where school children like to
cross the railroad track and it has been a concern." Dep. o f Richard Stanger at 267 (Sept. 26,
1995) (Vol. 2). Although there have been no fatalities or even injuries at this Metrolink at-grade
crossing far from the inner city, id., the MTA in the summer of 1995 gave nearly $2 million —
$1,789,000 to be exact — to the City of Los Angeles to construct a "pedestrian grade separation
over the Metrolink Moorpark Line [Ventura Line] right of way, connecting Willis Avenue to
Raymer Street in Van Nuys" so as to "provide a safe pedestrian route." Memo from Judith
Wilson to Call for Projects Committee re: "Transportation Improvement Program (TIP) Call for
G:\mta\mediate\rg-bliss 160
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Projects Staff Recommendations" at 56 (May 16, 1995) (bracketted material added), M322807 at
M322862.
D. Bus Operations Have A Greater Impact
On Regional Economic Development Than
Rail Development Does_________________
455. Bus operations have two significant advantage over rail construction in regional
economic impact. $1.00 of taxpayer funds allocated to rail construction will result in $1.00 of
rail construction expenditures, but a dollar of taxpayer funds allocated to MTA bus operations
will currently result in $1.59 being spent on bus operations. Bus operation, unlike rail
construction, generates part of its own funding through fares and other operating revenues.
Amended Expert Report and Response to Report o f Robert L. Peskin by Thomas A. Rubin (Jan.
1, 1996), E100061.
456. Besides the direct economic impact generated by expenditures to operate the-bus
system, there is a significant tertiary impact from the transportation services provided. Since
more residents have access to jobs, or to better jobs, and have improved access to shopping,
medical services, entertainment, etc., regional economic activity is increased. Rail construction
generates no such tertiary impact of this type for the simple reason that no transit trips are
generated during the construction process — in fact, the usual construction disruptions to
transportation and access to retail and other economic activity centers actually produce a negative
tertiary impact. Amended Expert Report and Response to Report of Robert L. Peskin by Thomas
A. Rubin (Jan. 1, 1996), E l00061.
457. MTA documents show that for 1995, total MTA bus operations employment was
5,425, and total rail employment was 989. A subsidy of $64,737 was required to create a bus
operations job compared to $413,793 for a rail construction job. As a result, a taxpayer dollar
spent on operating bus operations creates 6.4 as many direct jobs as does a dollar spent on rail
construction. Amended Expert Report and Response to Report o f Robert L. Peskin by Thomas A.
Rubin (Jan. 1, 1996), E100061.
458. Three-quarters of former RTD employees are minority residents while
construction jobs are less likely to be held by minorities or residents. Amended Expert Report
G:\mta\mediate\rg-bliss 161
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
and Response to Report o f Robert L. Peskin by Thomas A. Rubin (Jan. 1, 1996), E100061.
E. Commuter Buses Serve Regional Transportation
Needs At Lower Cost Than Rail Development Does
459. A comparative analysis of the cost of Metrolink and the cost of long haul
commuter bus transit operations in New Jersey shows that the fare is $.15 a mile for Metrolink
and $.14 per mile for the New Jersey bus operations. However, the cost per passenger mile was
$.40 per passenger mile for Metrolink and $.17 for the bus operators. As a result, the Metrolink
subsidy per passenger mile is $.24 while the bus operators subsidy was $.03 or approximately 12
percent of Metrolink's subsidy. Amended Expert Report and Response to Report o f Robert L.
Peskin by Thomas A. Rubin (Jan. 1, 1996), E100061.
460. The El Monte Busway generates ten times the peak weekday passenger miles per
guideway mile as does the Long Beach Blue Line and carries people at a higher average speed of
52 miles per hour for buses in 1992. If other High Occupancy Vehicle (HOV) lanes are
expanded in accordance with the MTA 20-Year Plan's proposal for 31 new HOV projects in Los
Angeles County, commuter buses in other areas can be expected to attain such levels. Amended
Expert Report and Response to Report o f Robert L. Peskin by Thomas A. Rubin (Jan. 1, 1996),
E l00061.
461. One of the main advantages of long-haul commuter bus over commuter rail is
flexibility. Commuter rail can only run where the tracks are. Unfortunately, most of the rail
tracks were put in to serve industry — in some cases, they were deliberately put where the people
are not and/or residential patterns developed away from noisy freight train lines with their traffic
delays and industrial shipper customers. In contrast, long haul commuter bus can operate
wherever there is a freeway and a demand. The capital commitment to operate the service is
limited to the buses to operate the service; bus stops and park-and-ride lots (in many cases); and
operating, maintenance, and general management facilities — and HOV lanes, which are going to
be built anyway. Id.
462. Also, the problems of access to a rail guideway are greatly diminished with long-
haul commuter bus service because bus can provide its own guideway access. Buses, unlike
G : \mta\mediate\rg-bl iss 162
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
trains, can travel through neighborhoods, picking up passengers within walking distances of their
homes, and then get on a freeway or HOV lane and achieve guideway speeds comparable to or,
in some cases, in excess of those achieved by commuter rail. These savings in access time and
ease of access, plus greatly improved distribution of riders at the downtown end of the trip, can
be a major factor in attracting people away from their cars and to transit. Id.
F. Access To The Downtown Central Business District
Does Not Justify Fixed Guidewav Rail Development
463. Defendants’ expert Jeffrey Zupan rests his analysis of the benefits of rail on a
belief in the economic importance of traditional downtowns. This belief is particularly misplaced
in Los Angeles. Suburbanization is North America's dominant and most successful congestion
reduction mechanism, and Los Angeles is perhaps the leading example. Suburbanization has
shifted road and highway demand to less congested routes and away from core areas. All of the
available recent national survey data on self-reported trip lengths and/or durations corroborate
this view. Gordon and Richardson report that the findings from all seven recent large-scale
United States household surveys present a consistent story of the containment of metropolitan
area commuting times. Evidence from National Personal Transportation Survey (“NPTS”)
reports a commuting questionnaire included in the American Housing Surveys (1985, 1989), and
the two decennial census reports (1980 and 1990) all help to make the same point. The 1990
NPTS reveals that auto users' average shopping trip time in the New York CMSA was 12.35
minutes for central city residents and 11.8 minutes for suburban residents; the comparable
numbers for the Los Angeles CMSA were 11.0 and 9.9 minutes. The Los Angeles suburbanite
has a 20 percent shorter shopping trip than the New York center city resident. In fact, the 1990
NPTS data for private auto commuters show that trip times for commuters in the Los Angeles
CMSA are significantly better than those for the other nine of the top-ten CMSAs. Response to
"A Report by Jeffrey M. Zupan" by James E. Moore (undated), E l00000.
464. The new jobs in Los Angeles are not in the Central Bus District (CBD) to any
major extent, they are in the suburbs and exurbs. Using the most generous interpretation of CBD
job growth, the CBD added 47,819 new jobs from 1980 to 1990 - and the region added
G:\mta\mediate\rg-bliss 163
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
1,645,680. For every job that was created in the CBD, there were over 33 created elsewhere. If
the objective is to help lower income residents to gain employment through transportation, the
focus should be on helping them move to where the jobs are — not to where MTA would like
them to be to justify rail construction expenditures. Unfortunately, while some of the rail lines
go through minority housing areas, they are not necessarily well suited to the travel needs of the
residents of these areas. With stations a mile or more apart in the non-CBD sections of Los
Angeles County, there are comparatively few residents that have easy access to rail travel. These
passengers will need to use bus to access rail. Amended Expert Report and Response to "A
Report by Jeffrey M. Zupan" by Thomas A. Rubin (Jan. 1, 1996), E1000379.
465. The rail map of Los Angeles will never look like that of Manhattan, where there
are often rail stations every few blocks from everywhere. Many of the destinations where people
want to go in Los Angeles are simply not close to rail stations. While this is a major problem
for the traditional home-to-work trips, it is a far more serious problem for non-work trips. Rail
is simply extremely non-productive for many trips such as home-to-school, home-to-shopping,
home-to-church, home-to-medical, etc. Id.
466. Again, the problem is simply that the number of jobs added in the CBD will be
an extremely small segment of total new jobs in the region. The CBD currently has fewer than
6% of the jobs — and fewer than 3% of the new jobs — in the region, a number that has been
declining for many years. More important, what we are seeing is a CBD that is becoming the
employment site more and more for high-end jobs - law firms, CPA firms, headquarters,
bankers, etc. The entry-level positions that are likely to be more of interest to the lower-income,
working poor population are just not growing in the CBD area. Los Angeles does not have the
CBD to make rail a success. Id.
G. Irregularities Were Rampant During
The 1994 Bus Fare Restructuring
1. The MTA Board Committees That Studied
Fare Restructuring Did Not Recommend It
467. MTA staff prepared numerous internal reports about fare restructuring scenarios
in order to deal with a budgetary shortfall on bus operations. Most of the work was done in
G:\mta\mediate\rg-bliss 164
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
connection with a Fare Restructuring Committee chaired by MTA Board member Antonio
Villaraigosa, which started meeting in April 1993. Although he and at least one other member of
the Committee, Marvin Holen, wished to explore ways to obtain greater resources for bus
operations without raising fares, MTA staff memoranda almost exclusively considered fare and
pass price increases or elimination of passes altogether in order to raise more funds. Testimony
o f Antonio Villaraigosa and Marvin Holen; Dep. of Dana Woodbury at 426-28 (Aug. 18, 1995)
(Vol. 4).
468. The Fare Restructuring Committee considered restructuring scenarios in which bus
fares were reduced, took account of need, varied with distance or varied by time of day. E.g.,
MTA, Ridership, Costs and Revenue Impacts o f Reverting to Prior MTA Fare Structures (Jan. 4,
1994), M1011087; MTA, Comparing the Impact o f an All-Day Pricing Scenario to the Impacts of
A Peak/Off-Peak Scenario Presented to the Oct. 21, 1993, Meeting of the Fare Restructuring
Committee (Nov. 11, 1993), M1011105; MTA, Extension o f the Experimental $23 Senior-Monthly
Pass Demonstration (Nov. 5, 1993), M1011102; MTA, Presentation o f Fare Restructuring
Concept-Working Draft (Sept. 15, 1993), M302912; Comparing the Impact o f a Price Increase in
All Fare Categories to the Impacts of Two All-Cash Price Structure (Sept. 24, 1993), M302939;
MTA Selected Pricing Scenarios/Understanding the Fare Restructuring Concepts Discussed at the
Sept. 23, 1993, Committee Meeting (undated), M1011110; MTA, Boarding and Information on
Fare Collection Methods (July 2, 1993), M101U52; MTA, Additional Comparative Performance
Data for 20 Largest Operators and Local Operators (Sept. 15, 1993), M302891; MTA, Selected
Alternative Fare Structure with Reviewed Boarding Impacts (July 29, 1993), M1011183; MTA,
Alternative Fare Scenarios (July 23, 1993), M101139; MTA, Fare Restructuring Presentation
(April 1, 1993), M1011221.
469. The Fare Restructuring Committee scenarios for fare increases were designed to
generate revenue increases in the range of 15 to 25 million dollars. A staff-generated fare
restructuring package of $50 million was eventually presented to the Board. Dep. o f Dana
Woodbury at 418-19, 434 (Aug. 18, 1995) (Vol. 4).
470. According to MTA staff, a staff fare restructuring proposal that would raise the
G:\mta\mcdiate\rg-bliss 165
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
base cash fare to $1.25 (from the then-current $1.10 base fare), eliminate all passes except those
for the elderly and disabled and implement zone fares for rail service could generate $38 million
in additional fare revenue in FY 1994-95. However, as the MTA conceded, "[o]ver one million
transit dependent riders cannot afford this additional increase." MTA, Letter from Linda
Bohlinger, Deputy Executive Officer Capital Planning, to Betty Garland Federal Emergency
Management Agency (May 20, 1994), M339417, attached report entitled MTA Request to the
Federal Emergency Management Agency for Emergency Operating Assistance, at 4 (May 20,
1994) (requesting grant to "prevent fare increase"), M33918 at M339421.
471. MTA reported that "a fare increase would impose economic burden especially for
low income transit-dependent riders and limit their mobility. Over 20% of households in low-
income areas do not own an automobile and depend on public transit." Id. at 6, M339423.
472. The staff declined to consider whether bus operations were adequately funded vis-
a-vis other modes of MTA funded or operated transit. Staff considered only issues involving bus
"cross-subsidization," i.e., the relative contribution of different categories of bus riders, notably
cash and pass riders. MTA staff eventually recommended only the elimination of the regular
monthly bus pass because pass riders as a group were purportedly cross-subsidized by cash
passengers who paid less per boarding than pass passengers. Regular pass passengers, however,
actually were the category of pass riders who were least cross-subsidized. Senior and disabled
pass users were responsible for 19 percent of boardings, but paid only six percent of revenue.
Student pass holders were responsible for five percent of boardings, but only four percent of
revenue. The regular pass riders' share of revenue and share of boardings were virtually identical
(18.09 percent and 18.40 percent), indicating no cross-subsidization at all. While the MTA
Board retained senior and disabled and student passes, the Board eliminated the regular monthly
bus pass. MTA, Percent o f Revenue & Boardings by Fare Paid (June 1994), 800853; Dep. o f
Dana Woodbury at 502-04 (Aug. 18, 1995) (Vol. 4).
473. The Fare Restructuring Committee did not make any restructuring
recommendation or report to the Board. The Fare Restructuring Committee stopped holding
meetings because its chairman felt that nothing further could be gained by continuing to meet.
G:\mta\mediate\rg-bliss 166
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Dep. o f Dana Woodbury at 419-20, 425-26, 433-34, 470-71 (Aug. 18, 1995), (Vol. 4).
474. Staff fare restructuring reports were also submitted to the MTA Finance, Budget
and Efficiency Committee chaired by MTA Board member Marvin Holen. The Finance
Committee, like the Fare Restructuring Committee, made no recommendation on fare
restructuring to the Board. Dep. o f Dana Woodbury at 477-79 (Aug. 18, 1995) (Vol. 4).
475. In spite of the numerous staff reports, the staff failed to bring to the attention of
the Fare Restructuring Committee or the Finance, Budget and Efficiency Committee the McCone
Commission Recommendations, the Fare Attitude Report, or the Inner City Transit Needs
Assessment. No analysis was performed of racial disparities in fares or subsidies of MTA bus
riders compared to rail or municipal operator passengers. Nor did the staff conduct or present
any surveys of public attitude about MTA service or fares. Dep. o f Dana Woodbury at 420-22
(Aug. 18, 1995) (Vol. 4).
476. In a December 17, 1993, interoffice memo, MTA CEO White ordered MTA
executive officers to draw up cost reduction plans because MTA is "faced with [rail construction]
capital demands which exceed our capacity." MTA's cost reduction plans included no options to
halt or restructure expenditures on rail lines under construction in planning: "Due to time
constraints and the scope of work requested by MTA management, rail operations were
benchmarked but not analyzed." However, MTA placed increased bus fares and reduced bus
service on the list: "It is our belief that the operating shortfall must be addressed through a
combination of cost reductions in . . . bus operations management, labor, non-operations and bus
service delivery." MTA, Franklin White, Cost Reduction Plans and Agency-Wide Hiring Freeze
(Dec. 17, 1993), 800541 at 800561. Accord, Deloitte & Touche, Cost Reduction Project-
LACMTA (Feb. 9, 1994), 800541 at 800583. When asked whether their cost reduction
recommendations would include postponing spending on planned rail projects, Deloitte and
Touche, MTA's accountants, indicated that they would not review rail construction as part of
their work. Testimony of Thomas Rubin.
477. The MTA staffs proposal for fare restructuring was presented directly to the full
Board in May 1994. In its memorandum to the Board in support of proposed fare restructuring
G:\mta\mcdiate\rg-bliss 167
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
or service reduction, MTA staff stated that it had only considered bus fare restructuring
alternatives. MTA staff stated that it specifically did not recommend leaving the fare structure
unchanged because a projected $126 million operating budget deficit would then have to be
covered by other means, including "reallocation of revenues." Dep. o f Dana Woodbury at 433-
35 (Aug. 18, 1995) (Vol. 4); MTA, Judith Wilson, Proposed Changes to the Fare Structure for
Implementation on Sept. 1, 1994 (undated), 800409, 800411.
2. The Public Hearing Revealed Great Public
Opposition, Questioning the MTA's "Focusing
Its Financial Resources On Rail Development
At The Expense of Bus Service."__________
478. The public notice for a meeting to receive public comment on the fare
restructuring prepared by MTA staff listed only fare increase and service reduction options.
MTA, Approval o f a Notice o f Public Hearing and Hearing Date for Consideration of Fare and
Service Modifications (Dec. 1, 1993), M302945, 800274.
479. The MTA held a public meeting on April 23, 1994, to obtain comments on the
proposed fare restructuring and service reductions. The meeting was attended by approximately
1,000 persons. According to the MTA, half of those at the public meeting who addressed fare
restructuring "expressed opposition to a fare increase in any form." MTA, Arthur Leahy &. Judith
Wilson, Approve Findings o f Public Testimony Related to April 23, 1994 Public Hearing for
Possible Fare and Service Modifications for FY 1995 and Later (May 20, 1994), 800607 at
800608. "Individuals with this comment most commonly cited economic hardship and/or a
perceived unfairness as the basis for their opposition. Many also cited the general economic
condition of Southland households that are suffering from employment losses, very low or fixed-
income levels and hardship caused by recovery efforts from recent natural disasters. The Los
Angeles City Council is also on record opposing any fare increase at this time. The Council has
further requested its representatives on the MTA Board to take all measures to lower the base
fare to 50 cents." Id.
480. MTA reported that the public opposed "all 22 service [reduction] proposals."
The general consensus of the community was that transit
G:\mta\mediate\rg-bliss 168
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
dependent riders such as the elderly, disabled, students and the
working poor need and use public transit to travel to and from
work, church, schools, shopping centers and medical facilities.
Hence, should service be cancelled or seriously curtailed, little or
no transportation would be available to them to lead their normal
lives. This sentiment was echoed by the Los Angeles City
Council which passed a motion protesting any reduction in bus
service. Many respondents said the bus system is already
seriously overcrowded and thought service should be added rather
than cutback.
MTA, Arthur Leahy & Judith Wilson, Approve Findings o f Public Testimony Related to April 23,
1994 Public hearing for Possible Fare and Service Modifications for FY 1995 and Later (May
20, 1994), 800607 at 800611; see also MTA Request to the Federal Emergency Management
Agency for Emergency Operating Assistance, at 6 (May 20, 1994), M339418 at M339423,
attached to Letter from Linda Bohlinger to Betty Garland (May 20, 1994), M339417.
481. The MTA also reported that there were numerous expressions of public concern
that "MTA is focusing its financial resources on rail development at the expense of bus service."
Several respondents suggested that MTA lobby other levels
of government to obtain additional revenues to help fund
operations. Some suggested that new gas taxes, parking fees or
tax on corporations be legislated to help fund the bus and rail
system. Others suggested that the Proposition A and C allocation
formula be changed to earmark more funds for the bus system.
Many respondents expressed dissatisfaction with the
perception that MTA is focusing its financial resources on rail
development at the expense of bus service. They expressed their
concern that the availability, quality, cleanliness, security and cost
for bus service are moving in an undesirable direction. Comments
G:\mta\mcdiatc\rg-bliss 169
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
also reflected the concern that rail service will not be available to
most of them even at build-out. This last comment reflects the
concern that much of the current riding public will not benefit,
either now or in the future, from the expansion of the rail network,
although they believe they are the ones funding its development.
Some also noted that the issue centers not so much around fund
diversion, as around a matter of funding priority. These
statements were tempered somewhat, however, by support for the
continued development of a multimodal transportation system that
is equitable and designed for maximum public benefit.
Many comments in this category also tended to reflect a
general suspicion of government's ability to make sound financial
and public policy decisions. Often times, this view was expressed
in terms of the public's perception that agency officials place their
own interests before those of the public. This perception resulted
in comments that question the judgment behind proposing a fare
increase given the generally poor local economy. These
respondents also raised the apparent inconsistency in government
policy with regard to promoting transit usage on one hand, while
on the other, making its use more difficult and more costly.
Another concern expressed by respondents was the lack of
equity in transit services. This included the concern about an
alleged existence of two classes of service. This dichotomy was
expressed both in terms of suburban express bus service versus
local urban service, and bus versus rail service. Some respondents
suggested that the rail system be priced to achieve the same cost
recovery as the bus system. Others suggested that construction of
the rail system be slowed in order to channel investment into bus
G:\mta\mediatc\rg-hliss 170
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
system improvement.
MTA, Arthur Leahy & Judith Wilson, Approve Findings o f Public Testimony Related to April 23,
1994 Public Hearings for Possible Fare and Service Modification for FY 1995 and Later (May
20, 1994), 800607 at 800611-12; Testimony of Eric Mann.
482. MTA reported that at the May 18, 1994, public hearing on proposed fare
increases and service cuts, participants noted that: "[A] fare increase would impose economic
burden especially for low income transit-dependent riders and limit their mobility. Over 20% of
households in low-income areas do not own an automobile and depend on public transit." MTA
also stated that "[a]n 8% reduction in transit service would prevent a projected 4.7 million transit
riders from using public transit to work, school, church and other important destinations." MTA,
Letter from Linda Bohlinger to FEMA (with attached report entitled "LACMTA Request to the
Federal Emergency Management Agency for Emergency Operating Assistance”) (May 2G, 1-994),
M339417 at M339423.
3. The Staff Gave The MTA Board No Financial
Options Other Than To Restructure Bus Fares
483. The Board of the MTA consists of public officials and appointees with fulltime
employment and outside interests. The agenda for a typical Board meeting has 60 items for
consideration and disposition. Written Board packages of briefing materials are often delivered
to Board members the day before or the day of the meeting itself. The failure of the staff to get
packages to board members in sufficient time for deliberate consideration has been a
longstanding problem. Depositions o f Gloria Molina and Richard Alatorre.
484. In a 1995 study commissioned by the MTA of its heavy rail construction
program, the Arthur Andersen accounting firm found that the MTA Board has "limited
transportation expertise and lacks continuity" and that Board members "rely heavily on the MTA
staff for guidance." The Arthur Andersen study also concluded that Board decisions are often
the results of a politically charged, rather than a fact based decision making process." MTA,
Arthur Andersen, Final Report of Recommendations for Contract No. LST-135-95 Study, Volume
A, at Chapter IV, 7-8 (April 24, 1995), D121959. Follow-up study by Arthur Anderson one year
G:\mta\mediate\rg-bliss 171
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
later came to the same conclusion. Arthur Andersen, Implementation Performance Reviewed 12-
13 (March 1996).
485. Former MTA CEO White told the MTA Board that: "I will tell you now I can't
vouch that everything that comes to you is absolutely straight. I can write papers that can fool
anybody, and stuff can go through on paper." MTA, Transcript o f Franklin White's Comments
Made in Open Session Regarding His Performance Appraisal, December 20, 1995, Board
Meeting, M808381 at M808388.
486. At the July 13, 1994, MTA Board meeting to consider fare restructuring, MTA
staff failed to provide the MTA Board any options to meet the anticipated budgetary shortfall
other than to restructure bus fares. In particular, the staff did not provide the MTA Board with
any alternatives involving restructuring rail construction programs or schedules, rail operations,
MTA funding for Metrolink, MTA funding for municipal transit operators, the Formula
Allocation procedure for funding municipal transit operators, or the Call for Projects' financial
allocation. The staff failed to provide and the Board did not request any analysis of all possible
funding sources. Dep. o f Dana Woodbury at 419-20 (Aug. 18, 1995) (Vol. 4); deps. o f MTA
Board members Alatorre, Antonovich, Burke, Holen, Molina, and Villaraigosa.
487. At the June 22, 1994, Board meeting to discuss the proposed fare restructuring,
Board member Villaraigosa objected that MTA staff had provided the Board with "selective[j"
data.
Director Villaraigosa complained about the use of indicators such
as operating cost and revenue instead of subsidy per passenger
mile. He also took issue with staffs presentation showing the
monthly cost of 42 work trips for passengers who take two buses.
People paying $42 are people who use the bus to go shopping and
to church. They don't have any alternative to the bus. He stated
that he found the selectivity of the charts offensive. Right now the
average fare for a pass user is 57 cents; so the fare is really going
from 57 cents to $1.35 for these people, and a chart should be
G:\mta\medtate\rg-bliss 172
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Board member Holen also noted that the subsidy per passenger mile ratio, which MTA staff
conceded was still among the lowest in the country, had an impact. Board member Holen also
suggested using the 20 largest transit operators instead of ten and comparing the MTA with other
local Los Angeles County operators. In response to staff statements that cities with lower costs
of living had higher transit fares, Board members asked whether these cities had a one cent sales
tax dedicated to transit and stated that Los Angeles bus riders had already paid for transit.
Minutes o f MTA Special Board Meeting (June 22, 1994), M902048 at M902050.
488. At the June 22, 1994, Board meeting about fare restructuring, Supervisor Burke
requested a report profiling the pass user, indicating how many passes were purchased by
corporations which could pay more for them. Id. M902048 at M902050.
489. At the June 22, 1994, Board meeting, CEO White admitted that modifying the rail
construction schedule and other measures were an option to a fare restructuring.
In response to director Alatorre's request for options other than a
$1.35 fare, Mr. White offered the scenario of no service cuts and
no fare increase. Sixty one million dollars of revenue would have
to be replaced. The money would have to come from [rail]
construction, further staff reductions, and borrowing.
* * *
Mr. White explained that if passes are retained, $ 11 million would
be lost. . . . That money would then have to come from a fund
accumulated to pay the rail bills, making it impossible to keep the
Red Line schedule.
Minutes o f MTA Special Board Meeting (June 22, 1994), M902048 at M902051-52.
490. MTA Board member Molina, a board member since 1993 who was also
represented on the LACTC since 1989, knows of no instance when the staff of the MTA or its
predecessors has on its own initiative proposed any action to further the interest of transit-
dependent minority bus riders. Supervisor Molina proposed mitigating the staff recommendation
added that shows that. The real story needs to be told.
G:\mta\mediate\rg-bliss 173
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
on fare restructuring by restoring passes and by keeping the token price at 90 cents; MTA staff
provided little or no support to her with respect to these proposals. Dep. o f Gloria Molina at 15
(Oct. 13, 1995).
491. MTA staff and the MTA Board considered fare restructuring separately from
budget deliberations, effectively precluding consideration of alternative revenue sources to avoid
fare restructuring. Testimony o f Antonio Villaraigosa.
492. In November 1994, MTA Board member and County Supervisor Burke moved
that MTA examine its legal and financial relationship with SCRRA, obtain information about the
per-passenger subsidy on Metrolink, MTA rail lines, MTA bus lines and obtain information about
the costs and benefits to Los Angeles City residents of MTA's continued participation in SCRRA.
Supervisor Burke stated that, under the joint powers agreement with SCRRA, MTA is to provide
administrative staff and related services to SCRRA through June 1998. According to Supervisor
Burke "(t]he purpose of that provision was to assure that the MTA, as the largest funding agency
for the SCRRA, maintains administrative control over the SCRRA." Nevertheless SCRRA had
voted 23 new SCRRA positions without advising MTA, and non-Los Angeles County SCRRA
Board members were seeking to amend the joint powers agreement to permit SCRRA to
independently employ its staff. Supervisor Burke also stated that she was "concerned over the
recent announcement by Metrolink officials of a 25 % [holiday] discount on Metrolink monthly
passes and the message that it sends to the transportation customers of the MTA."
493. In response to Supervisor Burke's motion about MTA subsidies for Metrolink,
Metrolink and MTA staff provided subsidy comparisons between Metrolink, MTA, Blue Line
and Red Line riders based on fiscal year 1993-94 overall "costs" without taking account of
capital costs in prior years. Memo from Richard Stanger & Judith Wilson to Planning and
Programming Committee re: MTA's Relationship with the SCRRA (Jan. 25, 1995), M323405,
M323410-11 at M323417-18; Testimony of Tom Rubin. The MTA report states that MTA spent
$523 million dollars on total capital costs since 1990 for Metrolink to purchase and improve
commuter rail rights-of-way and adjacent property to purchase trains. These capital costs,
typically expended prior to the commencement of railroad operations, are not accounted for in
G: \mt a\me<l i ate\rg-b 1 iss 174
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
MTA's subsidy comparisons and, as a result, understate the cost to MTA of Metrolink. The
same is true for the Blue Line and Red Line. The fiscal year 1993-94 "overall cost" of
Metrolink used in the comparison was $44 million, for the Blue line $50 million, and for the Red
Line $21 million. Capital costs for a rail line are typically the largest component of costs.
Comparisons to bus operations, where operating costs are typically greater than capital costs, are
therefore especially problematic. Testimony of Tom Rubin.
494. Notwithstanding the bias in the MTA's comparisons, MTA found that fiscal year
1993-94 subsidies per passenger boarding were:
Mode FY93/94 Cost Subsidv
Metrolink $9.94
MTA Bus $1.16
Blue Line $3.77
Red Line $4.22
Memo from Richard Stanger & Judith Wilson to Planning and Programming Committee
re: MTA's Relationship with the SCRRA (Jan. 25, 1995), M323405 at 323411.
495. MTA staff declined to recommend, and the Board declined to consider
alternatives to bus fare restructuring notwithstanding the protestations of plaintiff
Labor/Community Strategy Center and its request for a rail construction moratorium first
made in mid-1993. Testimony of Eric Mann.
496. MTA staff failed to provide the Board with documentation of the racial
composition of MTA bus riders affected by fare restructuring compared to the racial
composition of Metrolink riders and riders of municipal bus operators such as LADOT
Commuter Express and Foothill Transit, which were left unaffected by the fare
restructuring. Only information about the heavily minority composition of various
categories of MTA riders was provided by the staff to the Board. Deps. o f MTA Board
members Richard Alatorre, Michael Antonovich, Yvonne Braithwaite Burke, Gloria
Molina, and Antonio Villaraigosa; Dep. o f Dana Woodbury at 420 (Aug. 18, 1995) (Vol.
G: \mta\piediate\rg-bl iss 175
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
4).
497. MTA staff failed to provide the Board with comparative levels of total
capital and operating subsidies of MTA bus riders compared to Metrolink riders, MTA
rail riders, and riders of the municipal transit operators. The staff finally provided the
Board with some subsidy comparisons in January 1995 — six months after the MTA
Board had approved the fare restructuring — in response to a request for information from
MTA Board member Burke. Deps. o f Board members Richard Alatorre, Michael
Antonovich, Yvonne Braithwaite-Burke, Gloria Molina, and Antonio Villaraigosa; see
also, Los Angeles Times, Fare Hike Plan Points Up Inequities In Bus, Rail Subsidies
(Aug., 1994), 800039; Memo from Richard Stanger & Judith Wilson to Planning and
Programming Committee re: MTA's Relationship with the SCRRA (Jan. 25, 1995),
M323405 at M323411.
4. MTA Officials Have Admitted That The
Fare Restructuring Was Not Necessary
498. Board member Marvin Holen, a former chair of the RTD, sought to avoid
bus fare increases by instead restructuring rail projects. According to Mr. Holen, a bus
fare increase was not necessary because MTA could change its priorities and reallocate
resources to bus operations in order to avoid fare restructuring. At the July 1994 Board
meeting, Mr. Holen identified $89 million that could have been used to avoid fare
restructuring. Mr. Holen was readily able to identify almost a hundred million dollars
that could have been used to avoid fare restructuring in 1995. Testimony o f Marvin
Holen; MTA, Rail and Bus Facts (July 11, 1994), M329396 at M329402; Dep. o f Dana
Woodbury at 478-479 (Aug. 18, 1995) (Vol. 4).
499. Mr. Holen has reaffirmed that, shortly after White was appointed CEO of
the MTA in 1993, Mr. White admitted that "this agency is bankrupt" because MTA had
made rail commitments beyond its capacity to fund. Dep. o f Marvin Holen at 38 (Dec.
7, 1994).
500. At a public meeting of the MTA Finance Committee on December 16,
G:\mta\mediate\rg-bliss 176
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
1994, then-CEO White agreed with Mr. Holen that funds could be identified to avoid bus
fare restructuring.
Mr. Holen: "[W]hen we use the word 'shortfall,'
Mr. White, I think it's a very slippery word. I can design
a scenario in which the operating shortfall is $440 million
this year, approximately, no shortfall this year, or a surplus
this year. It is a matter of policy established by the MTA
board of directors as to the application of resources in any
particular area in the jurisdiction and activities of the
agency . . . [Ujsing such phrases as a $126 million
shortfall is simply a propaganda slogan."
Mr. White: "I understand what you're saying and I
omitted in my brief remarks to mention the flexibility we
do have, that you have often reminded us of and we do
have, of using money that is flexible that is now being
allocated for [rail] construction purposes, we always have
the opportunity to make a decision that says we don't want
to do that . . .."
Mr. Holen: " . . . What I guess my quarrel is that
don't come in and tell me I got to cut a line that carries
170,000 to 180,000 people because there is no choice.
Frank, there is another choice, there is [sic] 101 other
choices in terms of the allocation of resources in control of
this agency with respect to providing moneys to support
the bus system."
Defendant White: " . . . You are absolutely right."
Transcript of MTA Finance Committee Meeting o f December 16, 1994; Dec. o f Eric
Mann at 2 (Jan. 9, 1995); Testimony of Eric Mann.
G:\mta\mediate\rg-bliss 177
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
501. Then-CEO White "pleadjed] guilty" for the MTA’s failure to use
"discretionary dollars" to make the "bus system better." MTA, Transcript o f Franklin
White's Comments Made in Open Session Regarding His Performance Appraisal,
December 20, 1995, Board Meeting, M808381 at M808390-91.
502. Then-CEO White repeatedly emphasized that the MTA had available
discretionary funds that it could allocate to serve the needs of the transit dependent. Dep.
o f Franklin White at 65-67 (Oct. 27, 1995), and exhibits cited. Mr. White, in deposition
testimony, conceded that the fare increase was not necessary. According to CEO White,
there were alternatives to raising fares and eliminating passes in 1994. "Q. In your
opinion, were there other alternatives to raising fares and eliminating passes in August,
1994? A. There were alternatives." Id. at 60-61. MTA could have reprioritized its
objectives in order to eliminate the fare restructuring. Id. at 65, 67; see generally id. at
59-61, 65-67.
503. Less than a year after approving fare restructuring, the MTA agreed to
transfer $50 million to the County of Los Angeles for its budget shortfall. According to
one MTA Board member: "[I]t was somewhat ridiculous to have money to turn over — to
say and tell people that we had to raise the fare, on the other hand." Dep. o f Richard
Alatorre at 21 (Oct. 17, 1995). The source of the funds that the MTA gave to the
County is Proposition C 40% Discretionary funds that would otherwise be used primarily
for bus operations. See generally Dep. o f Linda Bohlinger at 135-42 (Sept. 12, 1995)
(Vol. 3); id. at 176-86, 191-99, 201-02, 215-29, 233-37, 241-50 (Sept. 12, 1995), (Vol.
4); id. at 271-74, 324-30 (Oct. 10, 1995) (Vol. 5).
504. At the August 1, 1995, Board meeting, several Board members spoke on
the proposal to give MTA funds to the County. Supervisor Burke used the analogy of
dividing one glass of water between two very thirsty people and said that the people who
will really be hurt are the poor people who depend upon the bus system. Los Angeles
City Councilman Alatorre said this action would be devastating to the transit dependent
people in his district. According to Councilman Alatorre, the County is taking money to
G:\mta\mcdiate\rg-bliss 178
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
assist people by keeping the County hospital open, but hurting them by taking away their
ability to get there. Minutes o f MlA Special Board Meeting (Aug. 1, 1995), M803904 at
M803905-06. At a later Board meeting, Councilman Alatorre commented that on the one
hand people are told that there is no money and the MTA needs to increase the fare, and
then it gives $50 million to the County. Minutes o f MTA Special Board Meeting (Aug.
30, 1995), M805486 at M805490.
505. After voting to raise fares and eliminate the regular bus passes, the MTA
identified at least hundreds of millions of dollars through cost savings on various
projects, including savings on the Pasadena Line and on other rail construction projects,
see Dep. o f Linda Bohlinger at 43-44 (Oct. 12, 1995) (Vol. 7); id. at 74 (Oct. 16, 1995)
(Vol. 8 ), savings that the MTA could use to avoid any fare restructuring. The MTA
could have taken these cost saving steps earlier. Id.
506. On August 23, 1995, MTA adopted the following changes in scope and
procedure in order to achieve cost savings on MTA projects and rail operations:
a. direct staff and EMC to raise the alignment and reduce the
station box depth for two stations on the Eastside extension
for a savings of approximately $15 million and research
seismic implications;
b. reduce the L.A. Car order from 74 to 52 cars for a total
savings of $30 million to the MTA;
c. utilize the next 30 days to study and make a determination
regarding implementation of the automoted driverless
features on L.A. Car;
d. adopt the modified rail operating cost model for a savings
of $398.5 million over 20 years;
e. adopt a lower cost HOV alternative for Route 10 with
modified lane widths, median and shoulders for a total cost
of $145 million;
G:\mta\mediatc\rg-bliss 179
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
f. adopt lower cost HOV alternative for Route 60 to the 605
(San Bemadino County Line) with modified lane widths,
median and shoulders for a total cost of $75 million;
g. develop and evaluate a low-cost, restriping alternative for
route 10 to provide a second HOV lane on the El Monte
Busway;
h. authorize staff to establish a reserve fund with accounts for
each rail construction project in terms of the design
allowance contingency and other similar discretionary
expenditures, that expenditures from these accounts would
require Board action in terms of the design allowance
when 70% of a rail project's contracts have reached or
exceeded the 60% final design phase; a report will be
prepared for board action to determine if the project's
design allowance should be reduced.
Minutes o f M lA Special Board Meeting (Aug. 23, 1995), M803914 at M803920; MTA, J.
Wilson, S. Phernambucq & A. Leahy, Cost Containment Recommendations for Red Line
Eastside Extension; L.A. Car; Rail Opening Costs; and Route 10 and Route 60 HOV
Lanes (Aug. 8, 1995), M804927; MTA, L. Bohlinger, MTA Cost Containment
Communications Plan (Oct. 18, 1995), M902494.
Vm. MTA HAS THE RESOURCES TO IMPROVE
BUS SERVICE AND LOWER FARES_______
A. MTA Receives, Allocates, And Spends Billions Of Dollars
In Local. State. And Federal Transportation Funds________
507. For Fiscal Year 1995-96, the MTA's major sources of revenue include the
following:
a. Net Proceeds of Prop A and C borrowings and interest income
plus carryover of prior year's unexpended balances: $655.0 [$658.8
million of FY96 Budgeted Prop A Revenue + $778.1 million of FY96
G: \mta\medi ate\rg-bl iss 180
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Budgeted Proposition C Revenue (FY 1995-96 Budget) - $392.9 million of
Prop A cash receipts - $389.0 million of Proposition C cash receipts
(Supporting Cash Flows, M302359)] utilized primarily for rail
construction.
b. City of Los Angeles Proposition A and C Local Return funds for
Red Line Construction: $54.3 million.
c. Other local revenues (including bond/note cash receipts): $92.7
million.
d. Federal Section 3 capital: $350.5 million, utilized primarily, if not
exclusively, for rail capital.
e. Federal Section 9 capital: $203.4 million, utilized primarily, if not
exclusively, for bus capital.
f. Federal Section 9 operating: $28.2 million, utilized for bus
operations and allocated to the MTA bus operations and to the municipal
bus operators per the same formula used to allocate Proposition A 40%
Discretionary funds.
g. Federal Surface Transportation Program/Congestion Mitigation and
Air Quality (STP/CMAQ): $98.6 million, utilized for road construction
and Green Line operations.
h. Other federal: $8.8 million.
i. Transportation Development Act: $275.2 million, utilized
primarily for bus operations subsidy and local share of bus capital grants,
distributed to the bus operators by the same formula used by the MTA to
allocate Proposition A 40 Percent Discretionary funds (the allocation of
capital funding utilizes a slightly different formula). TDA also provides
small amounts of other funds for various dedicated transportation
purposes.
G:\mta\mediatc\rg-bliss 181
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
j. Proposition 108/116 State rail bond proceeds for rail construction:
$64.0 million.
k. Other State of California funds: $90.9 million.
l. Bus and rail fare revenues: $213.0 million.
MTA FY 1995-1996 Proposed Budget, at 14-15 (undated), M301108 at 301124-25.
508. The State Transportation Development Act (TDA) provides state funding
to included municipal bus operators for operating and capital purposes. Revenues are
derived from 'A cent of the 6 cent retail sales tax collected statewide. The A cent is
returned by the state to each county according to the amount of tax collected in that
county. TDA Article 4 of the Act covers the amount of funds given to municipal transit
operators, transit authorities and joint power authorities. Article 4 money is 88 percent of
the TDA total. The MTA's formula share of Article 4 is 84 percent. Foothill Transit's 13 -
percent share comes out of the MTA's share. The other 16 percent is allocated to the
other municipal bus operators. MTA, untitled document concerning end o f year
adjustment to FY 1993-94 budget (undated), M1020692 at M l020693.
1. The MTA Drafted, Lobbied For, And Administers The
Two One-Half-Cent Local Sales Tax Measures
Known As Proposition A (1980) And Proposition C 119901
509. Proposition A levies a Ac sales tax on retail sales in Los Angeles County.
The tax revenues are dedicated to public transit. Proposition A was drafted and lobbied
for by the MTA. It was adopted by the voters in 1980. The MTA allocates and
administers the spending of all transit revenues raised through Proposition A.
510. Proposition C similarly levies a Ac sales tax on retail sales in Los Angeles
County. The tax revenues similarly are dedicated to public transit. Proposition C also
was drafted and lobbied for by the MTA. It was adopted by the voters in 1990. The
MTA allocates and administers the spending of all transit revenues raised through
Proposition C.
G:\mta\mediate\rg-bliss 182
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
a. Proposition A Produces Hundreds Of Millions
Of Sales Tax Dollars For Transit Each Year
511. Proposition A is a 'A cent retail transactions and use tax imposed in the
County of Los Angeles, it is to be used for public transit purposes, and it is controlled by
the MTA. Proposition A was placed on the November 1980 Los Angeles County
general election ballot by LACTC Ordinance No. 16, passed by the LACTC on August
20, 1980. The tax began to be collected in 1982 following its validation by the
California Supreme Court in LACTC v. Richmond. See generally Official Statement, MTA
Revenue Anticipation Notes, Series 1995-A (April 27, 1995), M322366 at M322380.
Proposition A, by its own terms, also lowered MTA bus fares to 50c for three years.
512. Proposition A funds are divided by law among three categories; in
practice and in fact the MTA divides the funds among four categories or "pots." After
deduction of the charges of the State Franchise Tax Board for collection of the
Proposition A tax revenues, the funds are divided as follows:
a. Administration. 5% of the funds are allocated to the MTA for
administrative purposes.
b. Rail Development Program. 35% of the "net" remaining funds are
allocated to the construction and operation of the MTA's light and heavy
rail lines. At the present time, all of the "35% funds" are utilized for rail
capital expenditures, with the majority of these funds utilized for debt
service on bonds and commercial paper issued to finance rail construction.
c. Local Return Program. 25% of the "net" funds go to 88 Los
Angeles County cities, and to the County Supervisors (on behalf of the
.unincorporated areas of the County) for local transit. The expenditure of
these funds is controlled by the MTA with regard to allocation,
compliance with MTA guidelines, and enforcement. These Local Return
funds are used chiefly to support the operations of the non-MTA
municipal bus operators and of demand-response transit services, and also
G:\mta\mcdiate\rg-bliss 183
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
to support capital expenditures for Metrolink and for other rail projects,
d. Discretionary. 40% of the "net" funds go to MTA for public
transit purposes. At the present time, most these funds are used to
subsidize MTA bus operations and the other Los Angeles County
municipal bus operators. These fund are distributed by the MTA to the
various municipal bus operators, and to the MTA, based upon a formula
which disfavors MTA bus operations.
See generally Official Statement, MTA Revenue Anticipation Notes, Series 1995-A (April
27, 1995), M322366 at M322380.
513. The historical net Proposition A sales tax receipts have been as follows:
Fiscal Year Net Sales Tax Cash Receiots
1991-92 $401,600,000
1992-93 $367,600,000
1993-94 $371,500,000
1994-95 $378,900,000 (estimated)
Official Statement, MTA Revenue Anticipation Notes, Series 1995-A (April 27, 1995),
M322366 at M322380.
514. Based on UCLA forecasts, the MTA predicts that the tax revenues which
will be raised by Proposition A during FY 1995-96 will total approximately $392.9
million, and that these Proposition A tax revenues will be even greater in the three
succeeding fiscal years. The MTA Proposition A revenue estimates (in $millions) for FY
1995-96 through FY 1998-99, by category, are as follows:
FY95-96 FY96-97 FY97-98 FY98-99
Administration $ 19.6 $ 20.6 $ 21.7 $ 23.1
Local Return 25% $ 93.3 $ 97.9 $102.9 $109.6
Rail Development 35% $130.7 $137.1 $144.1 $153.5
Discretionary 40% $1.493 $156.6 $164.7 $175.4
TOTALS $392.9 $412.2 $433.4 $461.6
G:\mta\mediate\rg-bliss 184
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
MTA Short Range Transit Plan Fiscal Years 1996-99, at Table 4-1 (June 2, 1995),
M336444 at M336466.
b. Proposition C Also Produces Hundreds Of Millions
Of Sales Tax Dollars For Transit Each Year_____
515. Proposition C also is a lA cent retail transactions and use tax imposed in
the County of Los Angeles, used for public transit purposes, and monitored and
controlled by the MTA. Proposition C was placed on the November 1990 Los Angeles
County general election ballot by Ordinance No. 49, adopted and recommended by the
LACTC on August 8, 1990. The tax began to be collected in the spring of 1991. The
validity of the Proposition C sales tax was upheld in 1992 in an unpublished decision in
Vernon v. State Board of Equalization. See generally Official Statement, MTA Revenue
Anticipation Notes, Series 1995-A (April 27, 1995), M322366 at M322381.
516. Proposition C funds are divided among six categories or "pots." After
deduction of the charges of the State Franchise Tax Board for collection of the
Proposition C tax revenues, the revenues are divided as follows:
a. Administration. 1.5% of the funds are allocated by the MTA to
itself for administrative purposes.
b. Transit-Related Improvements to Freeways and State Highways.
25% of the "net" remaining funds are supposed to be used for essential
County-wide transit related improvements to freeways and state highways.
At the present time, the MTA considers construction of rail lines which
are located within freeways, or which cross freeways, to qualify for this
funding. This "pot" also funds — or at least used to fund — the
construction of high occupancy vehicle (HOV) lanes on freeways and on
other thoroughfares.
c. Local Return Program. 20% of the “net" funds are for Los
Angeles County cities and the County Supervisors (on behalf of the
unincorporated areas of the County) to be used for local transit. The
G:\mta\mediate\rg-bliss 185
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
expenditure of these funds is controlled by the MTA with regard to
allocation, compliance with MTA guidelines, and enforcement. These
Local Return funds are used chiefly to support the operations of the non-
MTA municipal bus operators and of demand-response transit services,
and also to support capital expenditures for Metrolink and for other rail
projects.
d. Commuter Rail. Etc. 10% of the "net" funds are for commuter
rail (Metrolink), and for the construction/operation of transit centers, park-
and-ride lots, and freeway bus stops.
e. Rail and Bus Security. 5% of the "net" funds are for transit
security.
f. Discretionary. 40% of the "net" funds go to MTA for "general"
public transit purposes (except that such finds may not be utilized for the
construction of the Red Line between Union Station and Hollywood). At
the present time, the majority of these funds are utilized for rail operation
and construction purposes, with some remaining portions allocated to bus
operations.
See generally Official Statement, MTA Revenue Anticipation Notes, Series 1995-A (April
27, 1995), M322366 at M322381.
517. The historical net sales tax receipts from Proposition C have been as
follows:
Fiscal Year Net Sales Tax Cash Receints
1991-92 $ 28,300,000 (one month in FY91
after imposition of tax)
1992-93 $353,200,000
1993-94 $367,600,000
1994-95 $373,300,000 (estimated)
Official Statement, MTA Revenue Anticipation Notes, Series 1995-A (April 27, 1995),
G:\mta\mediate\rg-bliss 186
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
M 3 2 2 3 6 6 a t M 3 2 2 3 8 2 .
518. MTA Proposition C revenue estimates (in $ millions) for FY 1995-96
through FY 1998-99, by category, are as follows:
FY95-96 FY96-97 FY97-98 FY98-99
Administration 1.5% $ 5.8 $ 6.2 $ 6.5 $ 6.9
Discretionary 40% $153.3 $161.6 $170.8 $181.9
Freeways/Highways 25% $ 95.8 $101.0 $106.7 $113.7
Local Return 20% $ 76.6 $ 80.8 $ 85.4 $ 90.9
Commuter Rail 10% $ 38.3 $ 40.4 $ 42.7 $ 45.5
Rail/Bus Security 5% $ 19.2 $ 20.2 $ 21.3 $ 22.7
TOTALS $389.0 $410.2 $433.4 $461.6
MTA Short Range Transit Plan Fiscal Years 1996-99, at Table 4-1 (June 2, 1995),
M336444 at M336466.
2. MTA Has Locked Up Future Revenue
Streams For Rail By Issuing Long Term Bonds
519. The MTA has tied up future revenue streams for rail purposes by issuing
long term bonds which prevent any other use of dedicated funding sources until the
bonds are paid off, generally in thirty years. Dep. o f Franklin White at 114-16 (Oct. 27,
1995).
520. As of June 30, 1994, the MTA showed over $4 billion of long-term debt
on its balance sheet. It has since added hundreds of millions of dollars of additional debt
to this list. There is $3,546.3 million of new debt being added in the period from FY96-
FY13, $1,409.1 million in FY96-FY03 alone. Repaying this new debt will take $9.0
million in FY98, $35.5 million in FY99, $62.0 million in FYOO, $74.2 million in FY01,
$91.3 million in FY02, $110.5 million in FY03, etc., up to $243.4 million in FY13, for a
total of $1,822.7 million over the sixteen year period beginning in FY98. See 20-Year
Plan Supporting Cash Flows, at 27-28 (March 5, 1995), M302359.
521. The MTA has already mortgaged the future of Los Angeles County
G:\mta\rncdiatc\rg-bliss 187
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
taxpayers and transit riders for the over $4 billion of debt it has a lready issued.
Continuing to issue debt to finance its rail construction program will significantly eat
away at the major remaining source of general purpose funds left to it, the Proposition C
40 Percent Discretionary funds. Dep. o f Franklin White at 114-16 (Oct. 27, 1995).
522. Because the debt service to pay off the rail construction bonds comes off
the top, any shortfall will hit everything else but rail debt service — and can hit them
very hard. If there is a shortfall in expected revenue, as occurred/is occurring from the
period from FY91 into the foreseeable future, and/or there are major construction cost
overruns, as has occurred on every single MTA rail project, the shortfall hits everything
else. If MTA rail spending is not brought under control, the result will be as it has in
the past: bus operations are reduced, HOV lanes are not built, other valuable projects are
delayed or cancelled, but rail construction goes on. Amended Expert Report and
Response to Report o f Robert L. Peskin by Thomas A. Rubin (Jan. 1, 1996), E100061.
B. MTA Has And Could Aquire Many Millions of Dollars
To Improve Its Bus Service And To Lower Its Bus Fares
523. By concentrating its efforts on obtaining major federal investment grants
for rail projects, the MTA has foregone the opportunity to apply for and acquire such
funds for non-rail projects, particularly for busways, HOV lanes, and bus preference
lanes. This could be changed. Testimony o f Tom Rubin and Martin Wachs.
524. In a federal report titled "Report on Funding Levels and Allocation of
Funds — Report o f the Secretary o f Transportation to the United States Congress
Pursuant to Section 3(j) o f the Federal Transit Act)," Table 2, "Summary of FY 1995
New Starts Ratings," at 13-14, there are five busway projects elsewhere in the country
that are rated very highly. In fact, if the 27 projects where Cost/New Trip had been
calculated as a cost-effectiveness measure, busway projects ranked first (Houston), tied
for second (Pittsburgh East Busway Extension), tied for fifth (Pittsburgh Airport Busway
Phase I), and ranked fifteenth (South Boston Piers Transitway) (the fifth busway project,
the Orange County Transitway, did not report Cost/New Trip). The cost per new trip on
G:\mta\mediate\rg-bliss 188
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Los Angeles County busways and other non-rail guideway or transit preference projects
would be extremely competitive on a national basis — and far less costly than the
comparable statistic for rail new start projects in Los Angeles. Response to Peskin
Report by Tom Rubin, at 7-15 (Jan. 1, 1996), E100061.
525. In Los Angeles County, the El Monte Busway/HOV Lane is by far the
most successful transit guideway project in Southern California, providing approximately
ten times the carrying capacity of the Long Beach - Los Angeles Blue Line, and at a
construction cost of under $40 million dollars (1972-1975 dollars), compared to an
MTA-admitted cost of $877 million for the Long Beach - Los Angeles Blue Line.
Testimony o f Tom Rubin.
526. Apart from acquiring federal funds for bus projects, MTA has numerous
sources of funds under its control that it can utilize for purposes of funding MTA bus
operations. These include the following:
a. MTA could choose to charge Metrolink more for transfers made by rail
passengers from Metrolink to MTA buses. Metrolink currently pays MTA a fee
for such commuter rail transfer passengers, but the amount currently paid is only
a small fraction of MTA's costs to transport such passengers. Since MTA pays
approximately 60% of the Metrolink operating expenses and has the power to
dictate how its subsidy payments will be spent, this is a practical and effective
way of utilizing Proposition C 10 Percent Commuter Rail funds to pays the
related costs of MTA bus and rail operations. The amounts that could be
transferred would be in the millions of dollars per year. Rubin First Supl. Dec.
ffi 79-83, included in Amended Expert Report and Response to Report o f Robert
L. Peskin by Thomas A. Rubin (Jan. 1, 1996), E100061 at E100204.
b. The MTA could elect to "buy" Proposition A Local Return funds from
Los Angeles cities that would prefer to exchange such funds for a smaller amount
(generally approximately 60%) of unrestricted funds. This could potentially
provide the MTA new net revenues in the low- to mid-seven figures per year.
G:\mta\mediate\rg-bliss 189
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Id. a t 8 4 -9 1 .
c. The MTA could charge a fee for the Freeway Service Patrol services
which are currently provided to the public at no charge. If the MTA chose to
charge only third-party providers such as the American Automobile Association,
fees in the low- to mid-seven figures per year are realistic. Id. at f f 92-98.
d. The MTA could utilize Proposition C 25 Percent Freeway/Highway
Improvement funds either to fund directly the capital and/or operating expenses
of freeway bus services, or to use such funds for Red Line segments 2 and 3
construction costs, thereby freeing up Proposition C 40 Percent Discretionary
funds for bus operations. This could generate millions of dollars per year for bus
operations. Id. at fjf 99-100.
e. The MTA could cease operations of the Red Line MOS-1 and the Green
Line as nonproductive transportation expenses. This would generate tens of
millions of dollars per year for bus operations. If the MTA were as creative in
promoting this course of action as it has been in promoting rail construction,
there is a significant likelihood that any obstacles would be overcome. Id. at f
I01(a)&(b).
f. The MTA is attempting to remove itself and its employees from Social
Security, Old Age, Survivors, and Disability Insurance (OASDI). If it is
successful in this endeavor, the MTA may generate recurring savings as high as
$25 million per year plus one-time savings of $50 million. Approximately half
of these savings may be accruable to MTA (the rest accruing to the benefit of
individual MTA employees). As the vast majority of MTA employees deal with
bus operations, the vast majority of the savings from departing OASDI would be
usable for bus operations. Id. at f 101(c).
g. If the MTA enters into "Japanese Cross-Boarder Lease" transactions, the
MTA could potentially realize almost $6 million in additional revenues over the
period ending March, 1998. These revenues could be utilized for bus operations.
G:\mta\mediatc\rg-bliss 190
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
h. The MTA could reduce its spending on rail security by more than $10
million per year without any significant impact on the security of rail passengers,
employees, and property. The monies saved could be utilized to increase bus
security and/or to subsidize a higher level of bus operations. Id. at f 101(e).
i. The MTA could improve its investment returns on its bond reserve funds
by half a million dollars per year or more, and utilize the additional revenues for
bus operations. Id. at f 101(g).
j. The MTA is charging the bus operating funding sources for the office
space utilized by rail construction, rail operations, planning and programming,
and general administration by using bus farebox revenues to secure and pay for
general revenue bonds to finance its new headquarters building. The MTA could
pay for these rail programs from dedicated rail sources instead, freeing up the bus
farebox revenues for bus purposes. Approximately one year ago, MTA issued
$169.5 million of general revenue bonds to finance its new headquarters building.
$169,500,000 - Los Angeles County Metropolitan Transportation Authority
[California] General Revenue Bonds [Union Station Gateway Project] Series
1995-A, Official Statement (Jan. 18, 1995), 956540 The actual structure of the
transaction is a complex floating rate instrument with a swap agreement and no
annual debt service is shown in the Official Statement. However, for a $169.5
million fixed rate, semi-annual 30-year bond at a 5.5% annual interest (which
would have been below market rate at the time these bonds were issued), the
annual debt service would be approximately $11.6 million.
k. The primary security for these bonds is farebox revenue, advertising
revenue, and certain other minor MTA operating revenue sources (id. at 21), with
secondary backing from MTA sales tax revenues. From this structure, it is
reasonable to assume that the MTA intends to make the debt service payments on
these bonds from farebox revenues. Since, at present, farebox revenues are
Id . a t f 1 0 1 (e ) .
G:\mta\mcdiate\rg-bliss 191
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
utilized for bus and rail revenue service operations, and since bus and rail
operations require far less than 100% of the space in the MTA headquarters
building, this bond issue is a way for the MTA to utilize bus fare revenues to pay
a portion of MTA rail construction and operations, planning and programming,
and general administration costs. There are dedicated funding sources for at least
some of these purposes. The MTA is charging the bus operating funding sources
for the space utilized by rail construction, rail operations, planning and
programming, and general administration. It does not need to.
527. Finally, the funds that MTA is borrowing, backed by Proposition A 35
Percent Rail Construction and Operation funds, could be used for bus operations (as well
as for virtually any other transportation purpose).
PART TWO
SUMMARY OF THE LEGAL ISSUES
I. OVERVIEW
528. The District Court reviewed the factual and legal issues in the preliminary
injunction and summary judgment proceedings. As noted above, the District Court held
that, on the abbreviated preliminary injunction record, plaintiffs had presented "more than
sufficient evidence" to support their disparate impact claims for preliminary relief and
had “raised serious questions going to the merits” on the claims of intentional
discrimination. The MTA reiterated its defenses in a summary judgment motion
submitted after the close of discovery. The District Court denied the MTA’s summary
judgment motion.
529. MTA raises the general defense as to both the disparate impact and the
intentional discrimination claims that it acted in good faith even if its policies and
practices had an adverse disparate impact on minority MTA bus riders. These
protestations are unavailing under the disparate impact standard. As the Supreme Court
held in the seminal case of Griggs v. Duke Power Co., 401 U.S. 424, 431-32, 91 S. Ct.
849, 28 L. Ed. 2d 158 (1971), in the employment discrimination context: "Good intent or
G:\mta\mcdiatc\rg-bliss 192
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
absence of discriminatory intent does not redeem employment procedures . . . that
operate as 'built-in headwinds' for minority groups and are unrelated to measuring job
capability." The same is true in the present Title VI context involving provision of
transit service.
530. MTA's protestations are also unavailing under the intentional
discrimination standard. The Court of Appeals for the Ninth Circuit made this clear in
an intentional discrimination voting rights case, Garza v. County o f Los Angeles, 918
F.2d 763, 771 (9th Cir. 1990), cert, denied, 498 U.S. 1028, 111 S. Ct. 681, 112 L. Ed.
2d 673 (1991), when it rejected the defense that County supervisors drew discriminatory
district lines that adversely affected Latino residents in order to preserve incumbency, not
out of ethnic animus. As the Ninth Circuit held: "The supervisors intended to create the
very discriminatory result that occurred. That intent was coupled with the intent to
preserve incumbencies, but the discrimination need not be the sole goal in order to be
unlawful." 918 F.2d at 771. Judge Kozinski, concurring on liability, noted that the
intentional discrimination ruling did not rest on any finding of racial or ethnic animus,
but on the finding that "elected officials engaged in the single-minded pursuit of [an
innocent policy] can run roughshod over the rights of protected minorities." 918 F.2d at
778 (Kozinski, J., concurring and dissenting in part). In providing transit services, MTA
intended to create the very discriminatory consequences that ensued.
O. THE DISPARATE IMPACT CLAIM
A. The Title VI Regulations Prohibit Disparate Impact Discrimination
531. Title VI provides that "[n]o person in the United States shall on the
ground of race, color, or national origin, be excluded from participation in, be denied the
benefits of, or be subjected to discrimination under any program or activity receiving
Federal financial assistance." 42 U.S.C. § 2000d. Each federal department and agency
empowered to extend federal financial assistance was "authorized and directed to
effectuate the provisions of section 2000d of this title with respect to such program or
activity by issuing rules, regulations, or orders of general applicability." 42 U.S.C. §
G:\mta\mediate\rg-bliss 193
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
2000d-1.
532. An important purpose of the Title VI remedial scheme was to assure that
recipients of federal funds not maintain policies or practices that result in racial
discrimination. President Kennedy's June 19, 1963, message to Congress, proposing Title
VI, declared as follows: "Simple justice requires that public funds, to which all taxpayers
of all races contribute, not be spent in any fashion which encourages, entrenches,
subsidizes, or results in racial discrimination." 110 Cong. Rec. 6543 (1964) (Sen.
Humphrey, the Senate floor manager for Title VI, quoting the President's message); Lau
v. Nichols, 414 U.S. 563, 569 n.4, 94 S. Ct. 786, 39 L. Ed. 2d 1 (1974).
533. The United State Department of Transportation, which provides federal
funds to defendant MTA, has promulgated regulations that bar disparate impact
discrimination by recipients of federal funds.
A recipient, in determining the types of services, financial
aid, or other benefits, or facilities which will be provided
under any such program, or the class of persons to be
afforded an opportunity to participate in any such
program; may not, directly or through contractual or other
arrangements, utilize criteria or methods of administration
which give the effect of subjecting persons to
discrimination because of their race, color, or national
origin, or have the effect of defeating or substantially
impairing accomplishment of the objectives of the program
with respect to individuals of a particular race, color, or
national origin.
49 C.F.R. § 21.5(b)(2).
534. On July 14, 1994, the 30th anniversary of the passage of Title VI,
Attorney General Janet Reno issued a memorandum to the heads of departments and
agencies that provide federal financial assistance to local government agencies reiterating
G:\mta\mediate\rg-bliss 194
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
that "administrative regulations implementing Title VI apply not only to intentional
discrimination but also to policies and practices that have a discriminatory effect."
According to the Attorney General:
Individuals continue to be denied, on the basis of their
race, color, or national origin, the full and equal
opportunity to participate in or receive the benefits of
programs from policies and practices that are neutral on
their face but have the effect of discriminating. Those
policies and practices must be eliminated unless they are
shown to be necessary to the program's operation and
there is no less discriminatory alternative.
Memorandum from Attorney General Janet Reno to Heads of Departments and Agencies
that Provide Federal Financial Assistance, Use o f the Disparate Impact in Administrative
Regulations Under Title VI o f the Civil Rights Act o f 1964 (July 14, 1994), 800186. (The
Attorney General leads and coordinates the federal government's Title VI enforcement
efforts. Executive Order 12250, 45 Fed. Reg. 72995 (November 2, 1980)).
535. All agencies such as the MTA that receive federal funding enter into
standard agreements that require certification that the recipient will comply with the
implementing regulations under Title VI. Guardians Ass'n v. Civil Service Commission,
463 U.S. 582, 642 n.13, 103 S. Ct. 3221, 77 L. Ed. 2d 866 (1983) (Stevens, J., joined by
Brennan and Blackmun, JJ., dissenting on other grounds). As Justice Marshall stressed
in Guardians:
Every application for federal financial assistance must, "as
a condition to its approval and the extension of any
Federal financial assistance," contain assurances that the
program will comply with Title VI and with all
requirements imposed pursuant to the executive regulations
issued under Title VI. In fact, applicants for federal
G:\mta\mcdiate\rg-bliss 195
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
assistance literally sign contracts in which they agree to
comply with Title VI and to "immediately take any
measures necessary" to do so. This assurance is given "in
consideration of" federal aid, and the Federal Government
extends assistance "in reliance on" the assurance of
compliance.
Guardians, 463 U.S. at 629 (Marshall, J., concurring in part and dissenting in part).
“[T]he grant agreements under Title VI specifically mention compliance with the
executive regulations, which unambiguously incorporate an effects standard.” Id. at 631
n.27. MTA has declared its commitment to comply with the Title VI regulations in its
grant applications, in the terms of its grants, and in its contracts for federal funds. See,
e.g., MTA, Federal Transit Administration Assistance Programs, Certifications and
Assurances for FY 95 Appendix (Nov. 9, 1994), M700754; Federal Transit
Administration Civil Rights Assurance and the Assurance of Compliance with Title VI
(March 24, 1993), M328439-40; Master Agreement (Oct. 1, 1994), D129176; Dep. of
MTA Title VI official Frank Flores at 28, 30-43 (Oct. 31, 1995).
B. The Disparate Impact Standard
536. The elements of proof for a Title VI regulatory disparate impact case are
undisputed. See Amended Pretrial Conference Order at 13 (January 4, 1996). The
District Court has articulated the elements of proof.
To establish a Title VI disparate impact claim,
plaintiffs have the initial burden of demonstrating that the
challenged conduct has a discriminatory impact on the
protected class. Larry P. v. Riles, 793 F.2d 969, 982 (9th
Cir. 1984). Once the plaintiffs have made this showing,
the burden shifts to the defendants to prove that the
conduct causing the disproportionate impact was justified
by business necessity. Larry P., 793 F.2d at 983.
G:\mta\mediate\rg-bliss 196
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Plaintiffs may, then, rebut the claim of necessity by
demonstrating the existence of other nondiscriminatory
alternatives. Larry P., 793 F.2d at 983.
Findings o f Fact at 4\ accord, Amended Pretrial Conference Order at 13 (Jan. 4, 1996).
Under Title VI regulations, "once plaintiffs have shown that a facially neutral practice
has a disparate impact, the defendant may still prevail by proving a . . . necessity for the
practice." Jeldness v. Pearce, 30 F.3d. 1220, 1229 (9th Cir. 1994). "Once a plaintiff has
established a prima facie case, the burden then shifts to the defendant to demonstrate that
the requirement which caused the disproportionate impact was required by . . .
necessity." Larry P., 793 F.2d at 982.
537. Courts have found adverse disparate impact in Title VI and other civil
rights cases where, as here, plaintiffs received services or benefits less than or otherwise
inferior to those received by others served by federally-funded agencies. See, e.g.,
Jeldness, 30 F.3d at 1229 (disparate provision of prison education programs to women)
(Title IX); Larry P., 793 F.2d at 982 (disparate placement of black school children in
mentally retarded classes) (Title VI); Latimore v. Contra Costa County, No. C-94-1257-
SBA (N.D. Cal.) (Aug. 1, 1994) (disparate provision of hospital care) (Title VI); Meek v.
Martinez, 724 F. Supp. 888 (S.D. Fla. 1987) (disparate distribution of aid among the
elderly) (Title VI); Campaign for Fiscal Equity, Inc. v. State o f New York, 86 N.Y.2d
307, 1995 N.Y. LEXIS 1145 (New York Ct. App. June 15, 1995) (disparate distribution
of educational funds) (Title VI).
538. MTA speculates that the disparate impact analysis will not survive
renewed appellate scrutiny because it was first articulated in Guardians Ass'n v. Civil
Service Commission, 463 U.S. 582, 103 S. Ct 3221, 77 L. Ed. 2d 866 (1983), in a
plurality opinion. The disparate impact standard of the Title VI regulations, however,
was subsequently unanimously affirmed by the Supreme Court in Alexander v. Choate,
469 U.S. 287, 292-94, 105 S. Ct. 712, 83 L. Ed. 2d 661 (1985), adopted by the Ninth
Circuit in Larry P. v. Riles, applied by the Ninth Circuit as recently as two years ago in
G:\mta\mcdiate\rg-bliss 197
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Jeldness v. Pearce, 30 F.3d at 1229 (Title VI disparate impact standard applied in Title
IX cases), and reaffirmed by the Attorney General of the United States in 1994,
Memorandum from Attorney General Janet Reno to Heads of Departments and Agencies
that Provide Federal Financial Assistance, Use of the Disparate Impact in Administrative
Regulations Under Title VI o f the Civil Rights Act o f 1964 (July 14, 1994), 800186.
C. Plaintiffs Have Overwhelmingly Established a
Prima Facie Case of Adverse Disparate Impact
1. Numerical Disparities Are Statistically Significant To Establish
The Prima Facie Case Under The Castaneda Standard
539. Defendants maintain that the numerical disparities documented by the
record in this case do not amount to a Title VI violation because the disparities are not
statistically signficant. Defendants are wrong.
540. The Supreme Court addressed the issue of whether statistical evidence of
adverse disparate impact is statistically significant for purposes of the civil rights laws in
Castaneda v. Partida, 430 U.S. 482, 496 n.17, 97 S. Ct. 1272, 51 L. Ed. 2d 498 (1977),
an equal protection jury discrimination case. Castaneda concerned a challenge to grand
jury selection procedures of Hidalgo County, Texas, procedures that resulted in grand
juries that ranged between 39 and 50 percent Hispanic, although the pool of eligible
grand jurors was fully 79 percent Hispanic.
541. If ethnicity were not a factor, one would expect the actual selection rate
of Hispanic jurors to be within two or three standard deviations from the expected 79%
selection rate. The Castaneda Court held that a difference between an actual selection
rate and an expected selection rate in a binomial distribution greater than two or three
“standard deviations” was “suspect,” meaning it was highly improbable that the actual
selection rate was the result of chance. (The Court defined a standard deviation, the
measure of the predicated fluctuation from the expected value, as the square root of the
product of the total number in the sample times the probability of selecting a minority
group member times the probability of selecting a majority group member).
542. After determining that the variance between the actual and expected rates
G:\mta\mcdiate\rg-bliss 198
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
t
Suit* 208
of selection was greater than two or three standard deviations, 430 U.S. at 496 n.17, the
Castaneda Court ruled that the statistical proof was “enough to establish a prima facie
use of discrimination against the Mexican-Americans in the Hidalgo County grand jury
selection.” 430 U.S. at 496. Under the facts of Castaneda, see 430 U.S. at 496 n.17, a
hypothetical minority jury selection rate as high as 74 percent would have met the greater
than two or three standard deviations test, given the 79 percent minority pool of eligible
persons and the particular sample size of actual selections. (Given the 79 percent jury
pool, the expected number of Hispanic jurors among the 970 persons summoned for jury
duty was 688. The hypothetical selection of 640 Hispanic jurors, constituting a 74
percent selection rate, would be four standard deviations from the expected number.)
543. The Ninth Circuit has ratified the use of the Castaneda approach to
determine statistical significance in Title VI cases. Larry P. v. Riles, 793 F.2d at 782-83, .
affg 495 F. Supp. 926, 942-45 (N.D. Cal. 1979) (reciting chance improbability statistics).
See Hazelwood School District v. United States, 433 U.S. at 299, 308 n.14, 97 S. Ct.
2736, 53 L. Ed. 2d 768 (1977); Bouman v. Block, 940 F.2d at 1211, 1225, 1238
(statistical table) (9th Cir.), cert, denied, 502 U.S. 1005, 112 S. Ct. 640, 116 L. Ed. 2d
658 (1991) (Title VII employment discrimination cases).
2. Plaintiffs' Showing of Adverse Disparate Impact
Is Statistically Significant
a. Ridership Disparities Are
Statistically Significant
544. Plaintiffs present largely undisputed evidence of ridership disparities in
service between MTA bus riders and riders on other modes of MTA-operated or funded
transit. Given the 80% minority ridership on MTA generally, one would expect an 80%
minority ridership on other modes of transit in the absence of any racial or ethnic
headwinds. This is not the case. For example, the ridership of the approximately 18,000
daily riders of Metrolink is 28 percent minority. The actual minority ridership on
Metrolink varies by 173 standard deviations from the expected 80% minority ridership.
The likelihood that such a substantial departure from the expected value would occur by
199
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
k
Suit* 208
chance is infinitesimal. The comparisons between the contemporaneous 80 percent
minority MTA bus system and the majority white Metrolink and LADOT Commuter
Express and 47 percent white Foothill Transit lines are statistically significant. These
comparisons are greater than two or three standard deviations, thereby satisfying the
standard for significance under Castaneda.
545. As to MTA-operated rail lines, MTA has presented projections for the
ethnic origin of riders on rail lines at the end of the 20-Year Plan, based on 1990 census
data, prepared by their hired expert Professor Stopher of Louisiana State University.
These projections show substantial differences from the MTA systemwide 80 percent
minority ridership: the Long Beach Blue Line ridership would be 71 percent minority,
the Green Line 72 percent minority, the Red Line 66 percent minority, and the Pasadena
Line 63 percent minority. Peter Stopher, Report on Methodology for Ethnicity
Calculations at 29 (1995), E00001, E000030. If these percentages are applied to
contemporaneous daily ridership levels of 38,000 Long Beach Line riders, 12,000 Green
Line riders, and 18,000 Red Line riders, and to the 35,000 Pasadena Line riders that
MTA anticipates, the following are the results under the Castaneda analysis of deviations
from the expected 80 percent minority ridership.
Rail Line Number of Standard Deviations
Long Beach 43
Green Line 22
Red Line 47
Pasadena Line 79
The adverse disparity showing well exceeds the two or three standard deviations test of
Castaneda. The likelihood that such departures from the expected value would occur by
chance is infinitesimal.
546. These calculations, in fact, are exceedingly conservative because the pre
existing bus ridership in the rail corridors is likely to be higher than the systemwide
minority percentage. MTA admits in a document, for instance, that the pre-existing bus
200
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
ridership in the Long Beach corridor was fully 95 percent minority before the Blue Line
began service. Compared to the expected 95 percent minority ridership, the 71 percent
minority ridership that MTA projects yields a difference of 128 standard deviations under
the Castaneda analysis. The likelihood that such a substantial difference could have
occurred by chance is, for all practical purposes, zero.
b. Subsidy Disparities Are
Statistically Significant
547. Since 1984 MTA and its predecessors have embarked on a massive
program of rail development, and the expansion of Foothill Transit and LADOT bus
lines, which have impoverished one of the nation’s largest bus systems. As a result, the
MTA’s minority bus ridership has been subjected to severe adverse disparate impact in
the subsidies and services provided in contrast to the well-funded quality services
provided to the disproportionately white ridership on Metrolink, on MTA rail lines, and
on the municipal bus operators.
548. While 94 percent of its ridership are bus riders, MTA customarily spends
70 percent of its budget on the six percent of its ridership that are rail passengers. MTA
has spent or plans on spending almost nine billion dollars on its rail program. It has
spent hundreds of millions of dollars on Metrolink. In contrast, MTA has reduced its
peak hour bus fleet from 2200 to 1750 buses in the last decade in spite of increasing
demand.
549. MTA documents show that the total subsidy per boarding in 1992,
including both capital and operating expenses, for an MTA bus rider was $1.17, while
the comparable subsidy for a Metrolink rider was 18 times higher ($21.02), for a Blue
Line passenger it was more than nine times higher ($11.34), and for a Red Line
passenger it was two-and-a-half times higher ($2.92). These inter-modal comparisons
understate the disparity because rail lines are usually located only in the most heavily-
traveled transit corridors. The comparison with the $0.34 subsidy on the heavily-traveled
Vermont Avenue MTA bus line shows that the Metrolink subsidy is 62 times higher, the
G:\mta\mcdiatc\rg-bliss 201
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Blue Line subsidy 33 times higher and the Red Line subsidy nine times higher.
Controlling for distance traveled, large bus-rail disparities continue to exist.
550. The record shows that the subsidy levels for MTA bus riders are only
two-thirds of the average of the other municipal operators with local bus service,
although the cash fare was more than twice the average fare of the other municipal
operators.
551. Although MTA buses carry 85 percent of the County’s bus passengers
and account for 86 percent of passenger-miles, MTA receives only 80 percent of
operating funds under MTA’s allocation formula. More startling, MTA’s funding
allocation formula for capital funds resulted in allocations to MTA of only 66 percent to
77 percent in any year from 1989-95. As a result, in 1994, MTA buses had the highest
mileage (338,830 miles) while the average mileage of the rest of the County was only 54
percent as high (185,331). LADOT buses had one fifth the mileage of MTA buses, and
Foothill Transit buses just over a third the mileage. Using the Federal Transit
Administration standard that buses should be replaced that have a mileage of 500,000
miles, MTA in 1994 had 93 percent of the buses in the County with more than 500,000
mileage.
c. Disparities In Overcrowding, Security And
Service Are Statistically Significant_______
552. With respect to overcrowding, the District Court previously found that the
MTA and its predecessors customarily tolerated overcrowding levels of 140 percent of
capacity on its buses. Findings o f Fact and Conclusions o f Law re: Preliminary
Injunction at 2 (Sept. 21, 1994). Overcrowding on MTA buses is a designed defect in
the service provided. MTA has acknowledged the problem in numerous documents, but
has done little to alleviate it. Supervisor Burke initiated a demonstration project that
successfully eased overcrowding and security problems on the Vermont Avenue bus line
(which at the time carried eight percent of MTA’s bus ridership) for several months in
1993 at an annualized cost of $5.8 million, but MTA failed to follow through with any
G:\mta\mediatc\rg-bliss 202
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
remedial program of that scale, devoting only pitifully small sums to large numbers of
overcrowded lines. In contrast, there is no overcrowding of riders on Metrolink, MTA-
operated rail, and commuter lines such as Foothill Transit, LADOT Commuter Express,
Antelope Valley and Santa Clarita. The riders of these modes enjoy excellent service.
553. MTA documents show huge disparities in spending by MTA for the
personal security of its riders. While only three cents was spent by MTA for the security
of each bus passenger in fiscal year 1993, 43 times as much was spent for the security of
each passenger of Metrolink and the Long Beach Blue Line ($1.29) and 19 times as
much for each passenger on the Red Line. These disparities remain.
554. Plaintiffs’ experts Professor Wachs of the University of California at
Berkeley and Professor Taylor of UCLA confirm MTA’s own studies showing that even
among MTA bus riders, minority riders on local lines receive lower subsidies and receive
lower quality service than the disproportionately white riders of express buses. An MTA
study of downtown riders in 1990-93 showed that minority riders accounted for 87
percent of local bus riders but only 64 percent of express buses. The study showed that
the great majority of local riders (63 percent) had household incomes less than $15,000
while only 29 percent of express riders had such a low income. The 1993 Inner City
Transit Needs Assessment Study found as well that the subsidy levels were lowest in
poor, minority areas and the farebox recovery ratios highest, indicating that the highest
levels of crowding were in South Central, Hollywood and other poor, minority areas.
The 1995 update to the Assessment submitted by MTA expert Williams confirms the
persistence of these disparities. As the District Court found, in reliance on the Inner City
Transit Needs Assessment Study, “ 'service delivery problems have more severe impact
in the Inner City than in most other areas of the County’” because “inner city residents
are extremely dependent on public transit, and suffer from significantly more limited
access to transportation alternatives.” Findings o f Fact and Conclusions o f Law re:
Preliminary Injunction, at 2 (Sept. 21, 1994).
G : \mta\medi ate\rg -bl iss 203
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
3. MTA Invokes Invalid Population Comparisons To
Circumvent the Showing of Adverse Disparate Impact
555. MTA raises a number of interrelated claims based on invalid population
comparisons to contend that, irrespective of any analysis of ridership statistics or actual
usage, there can be no adverse disparate impact under Title VI. The District Court
rejected these defenses in both the preliminary injunction and summary judgment
proceedings. MTA raises the following claims:
(a) While the population of Los Angeles County as a whole is 60 percent minority, the
ridership of MTA rail lines is more than 60 percent minority.
(b) DOT guidelines classify a transportation line as a "minority line" based on the racial
composition of the census tracts that the line traverses.
(c) The ridership of MTA-operated rail lines consists of a majority of minorities.
None of these claims insulates MTA from liability for the disparate impact of its actions.
a. General Population Comparisons
Are Invalid___________________
556. By invoking general population statistics, MTA attempts to side-step the
shewing that MTA’s policies and practices have an unmistakable adverse disparate
impact on minority bus riders. The general population of Los Angeles County is not the
relevant comparison pool for purposes of assessing the disparate impact claims in this
litigation. The "[i]dentification of the appropriate candidate pool [of actual transit riders]
and its racial makeup is usually the starting point for impact analysis." Moore v. Hughes
Helicopter, 708 F.2d 475, 482 (9th Cir. 1983) (citation omitted). Courts have
consistently rejected the use of general population statistics as a proxy for the relevant
target population to analyze disparate impact claims in Title VII employment
discrimination cases. The Ninth Circuit looks to Title VII cases for guidance in Title VI
disparate impact cases. See, e.g., Larry P., 793 F.2d at 982 n.9, Robinson v. Adams, 847
F.2d 1315, 1318 (9th Cir. 1987), cert, denied, 490 U.S. 1105, 109 S. Ct. 3155, 104 L.
Ed. 2d 1018 (1989); Moore v. Hughes Helicopter, 708 F.2d 475, 482 n.5 (9th Cir. 1983)
(Moore cited by Larry P., 793 F.2d at 982 n.9).
G:\mta\mcdiate\rg-bliss 204
1
2
3
4
5
6
7
8
9
10
1 1
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
557. In Latimore v. Contra Costa County, No. C-94-1257 SBA (N.D. Cal.
Aug. 1, 1994), the District Court rejected an effort to use general population statistics to
obscure the fact that the location of a hospital for the poor had an adverse disparate
impact on the minority poor. "(D)efendants' statistics are deceptive because the (agency]
inappropriately relied on a sample population comprised of all County residents, as
opposed to the target population of County residents who are eligible to use | the County
hospital for the poor]. In conducting a disparate impact analysis, the appropriate sample
population should consist of those most likely affected by the action at issue." Latimore,
slip op. at 23.
558. MTA, moreover, erroneously ignores the fact that the plaintiff class
certified by the District Court consists of minority MTA bus riders, not minority
residents generaily, and that plaintiffs’ claims concern discrimination against minority bus
riders. See Order Certifying the Class (March 7, 1995); Amended Pretrial Conference
Order at 3 (Jan. 4, 1996).
559. In any event, while the minority ridership of MTA-operated rail lines
apparently may exceed the minority population of the County as a whole, it falls far
short of the expected 80 percent minority MTA ridership, the legally relevant
comparison. While only 11 percent of the County’s general population has no access to
a car, fully half of MTA’s ridership is transit dependent. Fully 80 percent of transit
dependent bus riders, the great bulk of MTA’s ridership, are minority. While 40 percent
of the County’s population is white, only 20 percent of MTA’s total ridership is white.
b. Transit Corridor Populations Do Not
Reflect Who Rides The Trains______
560. MTA notes that United States Department of Transportation guidelines
classify a transportation line as a "minority line" based on the racial composition of the
census tracts that the line traverses. The guidelines, which do not have the force of law
or regulation, are not entitled to deference, see Latimore, slip op. at 23 (rejecting federal
agency use of general population statistics in Title VI case). They are not intended to
G:\mta\mcdiate\rg-bliss 205
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
blind the decision maker to evidence of who is actually riding MTA operated or funded
public transit.
561. Census tracts do not ride lines. The racial composition of a transit
corridor simply does not indicate actual ridership. For example, the "whitest" line in the
entire MTA system is 80% white but MTA classifies it as a "minority line" because it
passes through minority census tracts:
[T]he "whitest" line in the entire MTA system during the
[1991-93] study period was the 457 freeway express,
which circulated through the predominantly white
neighborhoods in Seal Beach and southeastern Long Beach
before connecting to express freeway service up the Long
Beach Freeway (1-710) and into downtown Los Angeles.
MTA survey data showed that four out of five riders on
the 457 express where white, which was the highest level
of white ridership in the MTA system. But, because the
457 passed through predominantly minority census tracts
in Compton, Lynwood, South Gate, Bell Gardens,
Commerce, and East Los Angeles on its freeway run into
downtown LA, the 457 was classified as a minority line
by MTA for Title VI purposes.
Brian Taylor & Martin Wachs, Variations in Fare Payment and Public Subsidy by Race
and Ethnicity: An Examination o f the L.A. MTA, at 11 (Nov. 5, 1995) (based on analysis
o f MTA on-board survey data). MTA officials concede that the demographics of a
community does not determine the demographics of the ridership of a line through that
community. "Q. [T]he fact that a line passes through a community tells you nothing of
significance about the demographic characteristics of the riders on that line; is that
correct? A. That's correct." Dep. o f Keith Killough at 52 (Oct. 3, 1995) (Vol 2).
Accord, id. at 32-35, 39-40.
G: Vnta\mcd i atc\rg-bl iss 206
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
c. MTA Discriminates Against Minorities
Even Though The Majority Of Its
Ridership Consists Of Minorities
562. MTA erroneously asserts that it cannot be guilty of discriminating against
minority riders because a majority of the ridership on MTA-operated rail lines is
minority. MTA's position is wrong and runs contrary to Supreme Court law. The white
government of South Africa discriminated against the majority black population under
apartheid.
563. The Castaneda ruling makes clear that protected groups in the majority
can be subject to discrimination. The facts in Castaneda involved a majority 79 percent
minority pool, which is comparable to the 80% MTA ridership in the instant case. The
Supreme Court recognized that even a 74% selection rate would have been impermissible
given the 79% pool of eligible Hispanic jurors, because that rate was more than two or
three standard deviations from the expected rate. Castaneda, 430 U.S. at 496 at n. 17.
564. Similarly, the Supreme Court held that splitting a majority 66% African
American school district undergoing desegregation into a majority 52% black district and
a majority 72% black district impeded desegregation in violation of the Fourteenth
Amendment where white students benefitted from the split. Wright v. Council o f City of
Emporia, 407 U.S. 451, 464-66, 92 S. Ct. 2196, 33 L. Ed. 2d 51 (1972).
565. The Supreme Court rejected a defense analogous to MTA’s in its very
first case construing Title VII, Phillips v. Martin Marietta Corp., 400 U.S. 542, 91 S. Ct.
496, 27 L. Ed. 2d 613 (1971) (per curiam). The defendant argued that there was “no
question of bias against women” because 70 to 75% of the applicants and 75 to 80% of
those hired were women. 400 U.S. at 543. In response to the undisputed claim that the
company denied employment to women with pre-school-age children while employing
men with such children, the company argued that there could be no discrimination
against plaintiff women applicants with pre-school-age children because the overall group
of all women applicants was not subject to discrimination. The Court rejected the
defense, ruling that Title VII prohibited “one hiring policy for women and another for
G:\mta\tncdiatc\rg-bliss 207
2
3
4
5
6
7
8
9
10
1 1
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
1 men — each having pre-school-age children” in spite of the fact that a majority of the
persons hired were women like plaintiffs. 400 U.S. at 544. Similarly, the MTA cannot
insulate from judicial scrutiny its decisions to build and operate rail lines on the grounds
that the ridership consists of a majority of minorities or exceeds the County’s minority
population.
566. Disproportionate representation in the affected group establishes adverse
disparate impact, not the presence of a minority group in the majority in a particular
situation. In Larry P., the Ninth Circuit found adverse disparate impact based on the
"disproportionate" placement of black children" and the "disproportionate number of
black children" in educationally mentally retarded classes compared to the representation
of black children in classes generally. 793 F.2d at 983 (emphasis added). See Campaign
for Fiscal Equity, at *27-*28; Meek, 724 F. Supp. at 895-96; Coalition of Concerned
Citizens v. Damian, 608 F. Supp. 110, 127 (C.D. Ohio 1984) (same).
567. MTA also ignores that plaintiffs’ proof of adverse disparate impact
includes not only comparisons with MTA-operated rail lines but also comparisons with
the riderships of majority or predominantly white Metrolink, LADOT Commuter Express,
Foothill Transit and other municipal operator bus lines.
d. MTA Is Liable For The Disparate
Impact Of Actions Bv Agencies It Funds
568. MTA has argued that it bears no liability under Title VI or its regulations
for its vast funding of Metrolink and the municipal operators.
569. Title VI and its regulations, however, extend to any "program or activity,"
which the statute specifies as including "the entity of such state or local government that
distributes such assistance and each such department or agency (and each other State or
local government entity) to which the assistance is extended, in the case of assistance to
a State or local government." 42 U.S.C. § 2000d-4a. Moreover, the Title VI regulations
extend to the activities of a recipient which "directly or through contractual or other
arrangements" have a disparate impact. 49 CFR § 21.5(b)(2).
208
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
570. MTA receives federal funds, and MTA has funded and continues to fund
Metrolink and the municipal bus operators. That is all that is necessary to make Title VI
and its regulations applicable as a matter of law.
571. Although MTA “control” of these MTA-funded entities is not relevant to
the applicability of Title VI and its regulations, MTA in fact does have a high degree of
control over the entities it funds, particularly Metrolink, and also Foothill Transit, and
LADOT Commuter Express. MTA created Metrolink, created Foothill Transit, and
vastly expanded LADOT Commuter Express service; MTA has provided hundreds of
millions of dollars to Metrolink, and tens of millions of dollars to Foothill Transit and
LADOT; and MTA documents reveal MTA’s belief that its power-of-the-purse spending
equals substantial influence, if not also control.
572. MTA, in any event, has absolute control over Metrolink/SCRRA with
regard to what does -- or does not — go on in Los Angeles County. According to
Metrolink Executive Director Richard Stanger: "1 mean, an MTA representative tells me
they [sic] don't want me to work in Los Angeles County, then I don't do work in Los
Angeles County." Dep. o f Richard Stanger at 39 (July 27, 1995) (Vol. 1).
573. MTA decides what it wants to spend or not to spend, and how much it is
willing to contribute to Metrolink/SCRRA, the same as every other member agency of
Metrolink/SCRRA. Joint Powers Agreement at 3, § 4.4, Exh. 1 to Dec. o f Richard
Stanger (Sept. 20, 1994). "Ultimate control comes with each member agency's ability to
decide the level of operation it wants on its lines and the level of subsidy it is willing to
contribute." Memo from Richard Stanger & Judith Wilson to Planning and Programming
Committee re "MTA's Relationship with the SCRRA" at 5 (Jan. 25, 1995), M323405 at
M323409. . - ___________ ____________
e. The Urban League Case Provides
Defendants No Support ______
574. The MTA relies on a recent Second Circuit case, New York Urban
League, Inc. v. State o f New York, 71 F.3d 1031 (2d Cir. 1995), rev’g 905 F. Supp. 1266
G:\mta\mcdiatc\rg-bliss 209
1
2
3
4
5
6
7
8
9
10
1 1
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
(S.D.N.Y. 1995), which vacated a preliminary injunction issued to restrain a fare increase
by New York’s Metropolitan Transit Authority. The Second Circuit confirmed the
applicability of the disparate impact standard, 71 F.3d at 1036, but found that the district
court erroneously relied on a slender record of farebox recovery ratio comparisons
between the New York City subway and bus system and a suburban commuter rail
system as an indirect measure of differential subsidy levels. The Second Circuit held that
the lower court had failed to make the threshold finding that “this ratio would be a
reliable indicator of a disparate impact” in subsidization. 71 F.3d at 1038. In contrast,
the record in the instant case is voluminous and replete with direct evidence of
differences in spending allocations and various subsidies absent in Urban League.
D. Lack of Business Necessity
1. MTA Bears The Burden of Proving Business Necessity
575. Once plaintiffs demonstrate adverse disparate impact, "the burden shifts to
the defendants to prove that the conduct causing the disproportionate impact was justified
by business necessity." Findings o f Fact and Conclusions o f Law 4; accord. Amended
Pretrial Conference Order at 13 (Jan. 4, 1996). See Griggs v. Duke Power, 401 U.S. at
431; Jeldness, 30 F.3d at 1229; Larry P., 793 F.2d at 982. A defendants' burden
includes the burden of production and the burden of persuasion. See 42 U.S.C. § 2000e
(m), 42 U.S.C. § 2000e-2 (k)(l)(A).
576. Notwithstanding the rigorous requirements of the business necessity
standard, MTA has merely produced evidence that its funding of Metrolink and
municipal transit operators and its operation of the MTA's bus and rail lines allegedly is
not motivated by racial animus but by rational policy considerations. While intentional
discrimination cases may turn on evidence of a discriminatory motive, "[pjroof of
discriminatory motive, we have held, is not required under a disparate impact theory."
International Brotherhood o f Teamsters v. United States, 431 U.S. 324, n.15, 97 S. Ct.
1843, 52 L. Ed. 2d 396 (1977).
577. The point that the business necessity test requires "a more probing judicial
G:\mta\mediatc\rg-bliss 210
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
review of, and less deference to, the seemingly reasonable acts of administrators," was
also made by the Supreme Court in Washington v. Davis, 426 U.S. 229, 248, 96 S. Ct.
2040, 48 L. Ed. 2d 597 (1976), an intentional discrimination case:
Under Title VII, Congress provided that when
hiring and promotion practices disqualifying substantially
disproportionate numbers of blacks are challenged,
discriminatory purpose need not be proved, and that it is
an insufficient response to demonstrate some rational bases
for the challenged practices. It is necessary, in addition,
that they be "validated" in terms of job performance . . .
However this process proceeds, it involves a more probing
judicial review of, anu less deference to, the seemingly
reasonable acts of administrators and executives than is
appropriate under the Constitution . . . We are not
disposed to adopt this more rigorous standard for the
purposes of applying the . . . Fourteenth Amendment ]. . .
426 U.S. at 246-48.
578. In Griggs, the Supreme Court rejected the use of high school graduation
requirements and general intelligence tests that screen out black employees for desirable
jobs. The defendant there sought to justify the job requirements, arguing that they
"would improve the overall quality of the work force." 401 U.S. at 431. According to
Griggs, the necessity demonstration required expert industrial psychological proof that
the test "bear[s] a demonstrable relationship to successful performance of jobs for which
it [is] used." 401 U.S. at 431, 433; see also Albermarle Paper Co. v. Moody, 422 U.S.
405, 430-36, 95 S. Ct. 2362, 45 L. Ed. 2d 280 (1975) (discussing validation criteria).
579. In Larry P., the Court of Appeals held that the Griggs standard provides
guidance to Title VI challenges. The Ninth Circuit conducted a searching scrutiny of the
G:\mta\mcdiatc\rg-bliss 211
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
record to find that education authorities had failed to meet their burden of demonstrating
"educational necessity” in response to plaintiffs showing of disproportionate placement
of black schoolchildren to classes for the educationally mentally retarded. 793 F.2d at
980-83, affg 495 F. Supp. at 954-60, 968-73. The Court of Appeals rejected the claim
that such classes were beneficial to black children, noting that improper placement of
non-mentally retarded children in classes for the educationally mentally retarded has a
definite adverse effect. 793 F.2d at 983. The Court rejected defendant's expert evidence
that tests were validated, because the validation studies were conducted on white but not
black school children. 793 F.2d at 980-981. The Court also rejected defendant's claim
that blacks had a higher percentage of mental retardation than whites on the basis of an
analysis of mental retardation data and expert testimony. 793 F.2d at 983.
580. The Supreme Court adopted the “educational necessity” standard as
analogous to the Griggs business necessity standard for cases brought under a civil rights
statute similar to the Title VI regulations. Board o f Education v. Harris, 444 U.S. 130,
151, 100 S. Ct. 363, 62 L. Ed. 2d 275 (1979) (Emergency School Aid Act).
581. The utility of the business necessity standard was confirmed, although not
applied, by the Second Circuit in the Urban League case. 71 F.3d at 1036 (following
Larry P. and several cases which phrase the business necessity standard as “substantial
legitimate justification,” Elston v. Talladega County Board o f Education, 997 F.2d 1394,
1412 (11th Cir. 1993); Georgia State Conference o f Branches o f NAACP v. State o f
Georgia, 775 F.2d 1403, 1417-18 (11th Cir. 1985)).
582. In the context of this case, the parties agree that the business necessity
standard entails public transit necessity. Amended Pretrial Conference Order at 13 (Jan.
4, 1996). Public transit necessity requires at a minimum that MTA's actions serve
mobility goals and be justified in terms of equality, efficiency and cost effectiveness, and
equity. Mobility goals include the provision of rider, fiscal, environmental, economic
development or other benefits in compliance with federal, state and local law
requirements. See MTA Mission Statement (MTA's mission is to provide a
G: \mta\mcd i ate\rg-bl iss 212
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
"transportation system that increases mobility, relieves congestion and improves air
quality"), Amended Pretrial Conference Order at 13 (Jan. 4, 1996). Equality under Title
VI and its regulations means no disparate impact discrimination and no intentional
discrimination based on race, color or national origin. Efficiency and cost effectiveness
measure the performance of one system relative to another. Both are measures of getting
the most bang for the buck for transit dollars spent. See MTA Mission Statement (MTA's
mission is to provide an "affordable and efficient transportation system"), Amended
Pretrial Conference Order at 13 (Jan. 4, 1996); Deloitte <& Touche, Cost Reduction
Project LACMTA at 4-2 (efficiency refers to the cost of a unit o f output, typically cost
per hour o f service; cost effectiveness refers to the cost o f a unit o f consumption,
typically cost per passenger) (Feb. 9, 1994); Dep. o f Terry Matsumoto, MTA
Comptroller, at 163-65 (Sept. 19, 1995) (Vol. 2); Michael Cameron, Efficiency and
Fairness on the Road at 3 (1994) ("[tjransportation efficiency — meeting mobility goals
with the fewest resources possible"). Equity entails serving the needs of all MTA riders.
MTA Mission Statement (MTA's mission is to provide a transit system that "meets the
needs o f all Los Angeles County residents"). Amended Pretrial Conference Order at 13
(Jan. 4, 1996); Michael Cameron, Efficiency and Fairness on the Road at 3 (1994)
("[tjransportation equity — meeting the mobility requirements o f all people").
2. MTA Has Failed To Prove Business Necessity
583. MTA’s allocation of resources to the disadvantage of its bus riders is not
justified by public transit necessity. For example, according to MTA's own measures of
combined cost-effectiveness, mobility and air quality for all projects considered in the
planning process for the 20-Year Plan, all the rail projects performed significantly worse
than every other transportation project (with the possible exception of bike lanes in some
regards). MTA 20-Year Plan Technical Appendices at 20-21 (March 5, 1995), M302623
at M302643-44).
584. MTA's historic contraction of existing bus operations used by the great
bulk of minority riders in order to develop new rail lines and to create and expand
G:\mta\mediate\rg-bliss 213
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
suburban bus operators that serve a small, disproportionately white ridership is at odds
with applicable governmental guidelines. The federal Intermodal Transportation and
Efficiency Act of 1991, 49 U.S.C. App. § 1601 et seq. ("ISTEA"), which enacted
existing transportation planning principles, specifically commands that federal recipients
initially seek "preservation of existing transportation facilities and, when practical, ways
to meet transportation needs by using existing transportation facilities more efficiently."
49 U.S.C. App. § 1607 (f)(1). An UMTA guideline prohibits rail development that
diminishes existing bus service. A recently enacted state proposition declares that MTA
shall not receive certain state funds unless MTA restores affordable bus service and
reduces its debt. The MTA Board itself has adopted the provision of adequate bus
service as its first priority.
585. MTA has produced no independent validation studies that it was
necessary for MTA to maintain a dual system of public transit or to promulgate the July
1994 fare restructuring.
586. MTA's 20-Year Plan is not an independent study, nor a validation study
as it accepted as a given the necessity for all the transportation projects funded or
approved by the MTA, as well as the July 1994 fare restructuring. The expert reports
MTA has commissioned for the trial updating the Inner City Transit Needs Assessment
Study and projecting the future ridership of MTA-operated rail lines are not validation
studies. They, in any event, support liability. The original draft of the Needs
Assessment called for using funds slated for rail projects for bus improvements and
documented subsidy disparities in service in the Inner City. The update shows such
disparities continue unabated. The Stopher study projects minority representation on
MTA-operated rail lines that constitute significant adverse disparities. MTA’s expert
report by Jeffrey Zupan, which argues that building rail lines is desirable public policy,
does not address business or transit necessity or the adverse racial impact of rail
development in Los Angeles in reducing bus service to plaintiff class. The litany of
departures from substantive public transit norms summarized in the intentional
G:\mta\mcdiatc\rg-bliss 214
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
fc
Suite 208
discrimination section below further undercuts any claim of business necessity.
587. MTA, in short, has failed to produce evidence of business or public
transit necessity. As Chief Justice Rehnquist put it, "since there was no proof of any
business necessity adduced with respect to the policies in question, [the district] court
was entitled to assume 'no justification exists'." Nashville Gas Co. v. Satty, 434 U.S.
136, 143, 98 S. Ct. 347, 54 L.Ed. 2d 356 (1977) (citation omitted). "If the defendant
offers no proof to justify the practice or policy, the court is entitled to ' assume no
justification exists.'" Wambheim v. J.C. Penney Co., Inc., 642 F.2d 362, 365 (9th Cir.
1988).
3. MTA’s Claims Are Wholly Insufficient
Under the Business Necessity Standard_____
588. The generalized "legitimate" interests MTA asserts — the need to build
rail lines, the need to balance budgets, the need to attract white, middle class riders — are
nothing more than variants of the rejected assertion of good faith in Griggs, 401 U.S. at
431. They are not backed by any independent validation studies. MTA has made no
proper showing that the means chosen are justified by public transit necessity. See
Albermarle Paper Co. v. Moody, 422 U.S. 405, 430-36, 95 S. Ct. 2362, 45 L. Ed. 2d
280 (1975); Griggs, 401 U.S. at 431, 433; Larry P., 793 F.2d at 980-82. MTA's own
studies, such as the Inner City Transit Needs Assessment Study, Fare Attitude Survey,
and the Blue Line environmental impact report, establish that rail and other decisions
made by MTA are neither reasonable nor legitimate, much less necessary.
589. MTA relies upon Committee for a Better North Philadelphia v.
Southeastern Pennsylvania Transportation Authority, 1990 Lexis 10895 (E.D. Pa. 1990),
affd, 935 F.2d 1280 (3d Cir. 1991) ("SEPTA"), which held that the allocation of
subsidies to rail riders and an increase in fares that had a discriminatory adverse impace
on minority bus riders were justified by the legitimate business purpose of increasing rail
ridership. SEPTA's rejection of the business necessity standard in favor of a legitimate
business purpose test is at odds with controlling Ninth Circuit's case law in Jeldness and
215
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Larry P. The SEPTA legitimacy purpose test, moreover, is based on Wards Cove
Packing Co., Inc. v. Atonio, 490 U.S. 642, 109 S. Ct. 2115, 104 L. Ed. 2d. 733 (1989),
which Congress overruled in amending Title VII in 1991 to add 42 U.S.C. § 2000e-2
(k)(l)(A). Atonio v. Wards Cove Packing Co., Inc., 10 F.3d 1485, 1491 (9th Cir. 1993)
(The 1991 amendments "reinstate] ] the business necessity defense and place on the
employer the burden of proving that a practice causing a disparate impact is 'job related
for the position in question and consistent with business necessity'" (quoting 42 U.S.C. §
2000e-2(k)( 1)(A)(I))). See 2 Wilcox, California Employment Law § 41.03|2][d|
("[U]nder the Civil Rights Act of 1991, the Wards Cove standard for justifying an
employment practice will instead be governed by Griggs and other pre-Wards Cove
decisions."). In addition, according to MTA official Steve Brown, one of the main
arguments that the plaintiffs in the SEPTA case made "was that tokens, which were sold
only in 10-packs, were too expensive for the poor inner-city rider to purchase, thus they
were not able to take advantage of the discount . . . . Il]n the end, [SEPTA] began
providing tokens in 2-packs and 5-packs, which were then cheaper to purchase and
seemed to address most of the citizen groups concerns." Steve Brown, SEPTA Fare
Challenge 1989 (Sept. 6, 1994), M1010080.
590. MTA's reliance on NAACP v. Wilmington Medical Center, Inc., 491 F.
Supp. 290 (D. Del. 1980), affd, 657 F.2d 1322 (3d Cir. 1981), a hospital location case,
is flawed for similar reasons. The later Latimore hospital location case correctly applies
Supreme Court law and the law of the Circuit, e.g., Larry P., 793 F.2d at 892, to require
a business necessity showing.
E. Plaintiffs Have Demonstrated Less Discriminatory Alternatives
1. Plaintiffs’ Proof of Less Discriminatory Alternatives
591. The third stage of the disparate impact analysis is the plaintiffs'
demonstration of a less discriminatory alternative that the defendant has refused to adopt.
See 42 U.S.C. § 2000e-2 (k)(l)(A)(ii). In employment discrimination disparate impact
cases:
G:\mta\mcdiatc\rg-bliss 216
1
2
3
4
5
6
7
8
9
10
1 1
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
If an employer does then meet the burden of proving that
its tests are "job related," it remains open to the
complaining party to show that other tests or selection
devices, without a similarly undesirable racial effect,
would also serve the employer's legitimate interest in
"efficient and trustworthy workmanship."
Albermarle Paper Co. v. Moody, 422 U.S. 405, 425, 95 S. Ct. 2362, 45 L. Ed. 2d 280
(1975).
592. Although plaintiffs need not address this issue in light of MTA's failure to
demonstrate business necessity, the record discloses that MTA declined to implement
nondiscriminatory alternatives of restructuring or delaying rail and other non-MTA bus
projects or eliminating the adverse impact of allocation procedures among County
municipal operators in order to provide funds for enhanced bus service for the minority
poor. Such alternatives were proposed by plaintiff Labor/Community Strategy Center as
well as MTA's own Board members and, in the case of the Inner City Transit Needs
Assessment Study, MTA's own consultants.
593. MTA CEO Franklin White repeatedly stated that the MTA has available
discretionary funds that it could allocate to serve the needs of the transit dependent,
pleading “guilty” to failing to devote adequate discretionary funds for bus improvements,
and referring to MTA spending discretionary funds for the Pasadena and Green Lines as
“idiocy.” As the District Court found, the MTA Board voted to spend over $150 million
in discretionary funds on the Pasadena Line at the same time the Board raised bus fares
in 1994. Less than a year after approving the fare restructuring, MTA agreed to transfer
$50 million of discretionary funds to the County of Los Angeles for its budget shortfall,
an action one MTA Board member called "ridiculous."
594. After voting to raise fares and eliminate passes, MTA identified hundreds
of millions of dollars through cost savings on various projects and programs, including
the Pasadena Line and other rail construction projects that the MTA could have used to
G:\mta\medwtc\rg-bliss 217
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
avoid any fare restructuring. For example, MTA explicitly refused to consider cost
saving possibilities regarding rail operations and construction when it did a cost study on
bus operations in 1994. MTA subsequently commissioned the cost study of the rail
program by Arthur Andersen in 1995, which condemned the lack of cost controls, cost
effectiveness, and cost efficiency at the MTA.
595. The budget for the Pasadena Blue Line illustrates the runaway cost of
MTA 's rail projects: "The current budget for the Pasadena Line project is $67 million to
$71 million per mile. This is without precedent in the industry and does not appear to be
warranted by the complexity of the project." Peer Review Report for the Los Angeles
County Metropolitan Transportation Authority: Pasadena Rlue Line (April 25, 1995)
M323040, M323047.
596. MTA asserts that the less discriminatory alternative test is not "a license
to second guess" a defendant's policy choices. In the instant case, the alternatives are not
hypothetical, but actual budgetary alternatives proposed by MTA's Board members,
plaintiff Labor Community Strategy Center and others or were readily apparent
alternatives.
597. MTA's actions are inconsistent with its policy statement that the MTA’s
highest priority is improving bus service, inconsistent with federal requirements that new
rail construction not diminish preexisting service, and inconsistent with state requirements
that affordable bus service be safeguarded. The less discriminatory alternatives available
to MTA, in contrast, are entirely consistent with its mission.
2. The Less Discriminatory Alternative Standard
Properly Applies To Public Transit_________
598. MTA contends that the less discriminatory alternative inquiry is
inappropriate for cases other than employment selection cases under Title VII. MTA's
underlying premise that Title VII cases do not involve funding allocation matters is
erroneous. See, e.g., Los Angeles Dept, o f Water and Power v. Manhart, 435 U.S. 702,
98 S. Ct. 1370, 55 L. Ed. 2d 657 (1978) (illegality of gender-based pension fund
G : \mtaVnediatc\rg -bl iss 218
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
contributions).
599. MTA suggests that fare restructuring cannot be analyzed under the
disparate impact analysis because "it would not be good policy," citing no authority.
There is no such immunity, express or implied, under Title VI or its regulations. It is
self-evident that if a federally-subsidized defendant distributes benefits or charges for
services by race or ethnicity, the prohibition of Title VI and its regulations is implicated
that "[n]o person in the United States shall . . . be subjected to discrimination under any
program or activity receiving Federal financial assistance." 42 U.S.C. § 2000d. See
Bazemore v. Friday, 478 U.S. 385, 106 S. Ct. 3000, 92 L. Ed. 2d 315 (1986) (Title VII
bars separate pay scales); Meek v. Martinez, 724 F. Supp. 888 (S.D. Fla. 1987) (adverse
disparate impact of formula for distribution of benefits for the elderly violates Title VI);
Campaign for Fiscal Equity at *27-*28 (adverse disparate impact of educational funding
on New York City with its higher minority population, violates Title VI). MTA states
that the federal regulations do not list fare restructuring as an illustrative example of acts
prohibited by Title VI. The regulations, however, state that the examples are not
exhaustive. See 49 CFR Part 21 Appendix C.
600. Moreover, in the instant case, the July 1994 fare increase and elimination
of the regular bus pass is discriminatory because it widened preexisting, adverse subsidy
disparities between the minority MTA bus ridership and the disproportionately white
riders of other modes of MTA-funded or operated transportation and even MTA express
bus riders.
601. MTA relies on Furnco Constr. Corp. v. Waters, 438 U.S. 567, 578, 57 L.
Ed. 2d 957, 98 S. Ct. 2943 (1978), but concedes that Furnco is an intentional
discrimination case rather than a disparate impact case. MTA also relies on Wilmington
Medical Center, 491 F. Supp. at 293, and Bryan v. Koch, 627 F.2d 612, 619 (2d Cir.
1980), two hospital cases, which questioned the utility of the less discriminatory
alternative inquiry. They, however, do not follow the law of the Circuit on the use of
Title VII disparate impact standards. See Albermarle; Jeldness\ Larry P.\ Latimore.
G:\mta\mcdiate\rg-bliss 219
1
2
3
4
5
6
7
8
9
10
1 1
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
m . THE INTENTIONAL DISCRIMINATION CLAIM
A. The Arlington Heights Standard
602. The Supreme Court has recognized that "[determining whether invidious
discriminatory purpose was a motivating factor demands a sensitive inquiry into such
circumstantial and direct evidence of intent as may be available." Arlington Heights v.
Metropolitan Housing Corp., 429 U.S. 252, 266, 97 S. Ct. 555, 50 L. Ed. 2d 450 (1977);
Federal Deposit Ins. Corp. v. Henderson, 940 F.2d 465, 471 (9th Cir. 1991). The Court
in Arlington Heights listed the following evidence that should be considered in
determining if discriminatory purpose exits: "(1) the impact of the official action, whether
it bears more heavily on one race than another, may provide an important starting point;
(2) the historical background of the decision, particularly if a series of official actions
was taken for invidious purposes; (3) departures from the normal sequence; and (4)
substantive departures, particularly if the factors usually considered important by the
decision maker strongly favor a decision contrary to the one reached." 429 U.S. at 266-
67. In addition, it is appropriate to consider evidence of MTA's extensive and specific
knowledge of the harm its decision caused and would continue to cause. See Columbus
Board o f Education v. Penick, 443 U.S. 449, 465, 99 S. Ct. 2941, 61 L. Ed. 2d 666
(1979); Washington v. Davis, 426 U.S. at 242 (courts should consider totality of relevant
facts).
B. Proof of Intentional Discrimination
603. Contrary to the Court's finding in its preliminary injunction order that
plaintiffs had raised serious questions on the merits as to their intentional discrimination
claim under Arlington Heights, Findings o f Fact and Conclusions o f Law at 5, MTA has
M
declared that it knows of no facts that support the intentional discrimination claim. The
complete record amply confirms the District Court's initial assessment of the state of the
record on intentional discrimination on MTA's development and maintenance of a dual
transportation system and the July 1994 restructuring.
G:\mta\mcdiatc\rg-bliss 220
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
1. Adverse Disparate Impact
604. The showing of unjustified adverse disparate impact described above
establishes that MTA’s official actions bear “more heavily” on minority MTA bus riders
than the passengers of other modes of transportation operated or funded by MTA. The
record establishes that these disparities are long-standing, with report after report since
the 1965 McCone Commission report documenting that the actions of MTA and its
predecessors historically have disadvantaged minority bus riders, failing to provide them
adequate and affordable service.
605. Moreover, the disparity showing alone ignores the aggravating
circumstance that MTA actions in developing rail lines and creating municipal bus lines
to serve former MTA bus routes with disproportionately high white riders were
deliberate, purposeful actions taken to benefit a tiny portion of its ridership at the
expense of minority bus riders. See Washington v. Davis, 426 U.S. at 242; Penick, 443
U.S. at 465. MTA built the Long Beach Blue Line, for instance, not for the benefit of
the pre-existing minority bus ridership, but for white commuters who account for the
incremental change from the 5% white ridership on pre-existing buses to the 29% white
ridership MTA projects. Initially, MTA’s predecessors planned no stops in the heavily
minority middle section of the Long Beach Line. MTA, moreover, has built no rail line
to serve minority communities, although the Inner City Crenshaw Line has been
proposed for many years. MTA and its predecessors set up and funded Foothill Transit
and LADOT to serve majority or disproportionately high white portions of its bus
ridership while taking no such actions on behalf of poor, minority bus riders, as
documented by the Inner City Transit Needs Assessment Study and reports prepared in
its aftermath. As an RTD document put it, “the [Foothill Transit] experiment is
beginning to turn Los Angeles into a two-class transit County” with new, comfortable
buses serving suburban areas and older, overcrowded buses serving the central city.
2. Historical Background
606. In 1965, the McCone Commission determined that the “inadequate” and
G:\mta\mcdiate\rg-bliss 221
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
“prohibitively expensive” bus service provided by MTA’s predecessors in South Central
Los Angeles contributed to the social conditions leading to the Watts Riots of 1964.
Although the Commission called for a more affordable fare, MTA’s predecessors
essentially maintained in constant dollars the fare decried as too costly for the next three
decades, except for the 1982-85 period when Proposition A mandated funds be used to
cut the fare. The 1994 increase from $1.10 to $1.35 that the District Court initially
enjoined pushed the bus fare above the level in constant dollars that the McCone
Commission condemned as prohibitively expensive.
607. With respect to service, MTA responded with great recalcitrance in
implementing the Commission recommendations, eventually initiating only one new east-
west bus line. The MTA and its predecessors ultimately failed to provide adequate
service for minority areas, as reported in the Inner City Transit Needs Assessment Study
and other MTA documents, devoted billions of funds for rail projects without any
commensurate effort on behalf of minority bus riders over the last decade, and split off
suburban lines with heavy white ridership for Foothill Transit and LADOT Commuter
Express. Ironically, the 1993 Inner City Transit Needs Assessment Study echoes the
Findings of the earlier McCone Commission Report.
3. Departures from Regularity
608. The record shows that MTA in the last decade departed from substantive
public transit norms by proceeding with rail and commuter bus programs that had
marginal or no rider, fiscal, environmental, economic development or other benefit. The
departures from regularity also demonstrates the lack of business or public transit
necessity to justify the MTA’s actions. MTA’s allocation of resources to the
disadvantage of its bus riders is inconsistent with its policy statement that the MTA’s
highest priority is improving bus service, inconsistent with federal requirements that new
rail construction not diminish preexisting service, and inconsistent with state requirements
that affordable bus service be safeguarded.
609. In 1980 and 1990, Los Angeles County voters approved MTA-sponsored
G:\mta\m<xliate\rg-bliss 222
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
ballot propositions that made sales tax revenues available for public transit, including
lowered bus fares, freeway improvements, and rail development. For the fiscal year
1995-96, sales tax revenues available from these propositions totaled $782 million. As
required by law, MTA initially lowered its bus fare. In the wake of the reduction, MTA
bus ridership skyrocketed to the highest levels since World War II. After the legally
mandated period of low bus fares ended, however, MTA began using sales tax revenues
and other funds principally for rail construction, including discretionary funds designed
for bus and freeway improvements. The rail construction program has consumed huue
resources, but it has produced little benefit for most MTA riders.
610. For example, over two-thirds of the riders on the light rail Long Beach
Blue Line that runs between Long Beach and downtown Los Angeles are former local
and express bus riders. While the bus lines that the Long Beach Line replaced were only
5% while, MTA projects that the ridership of the Long Beach Line will be 29% white.
The Long Beach Line and the buses it replaced take approximately the same time to
travel between Long Beach and downtown Los Angeles, but the Blue Line cost
approximately $1 billion. MTA considered and rejected a $6 million bus alternative
presented in the environmental impact statement prepared for the Long Beach Line. The
bus alternative provided comparable environmental and regional transportation benefits.
According to comments submitted by the City of Los Angeles in 1985, “[the] bus
alternative seems to negate the necessity of a fixed rail system in this location.”
611. MTA designed the Long Beach Blue Line with an at-grade roadbed along
its congested, and overwhelmingly minority, middle section. Trains run through the
middle section at speeds of 55 miles per hour at street level. Although the environmental
impact report predicted safety problems in the middle section, MTA went ahead as
planned. As a result, the Long Beach Line is the most dangerous and deadly light rail
line in the nation.
612. Although the Long Beach Line runs through minority communities, it was
not planned to achieve, nor has it resulted in, economic development along its route.
G:\mta\mediatc\rg-bltss 223
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
The Long Beach Line secures its ridership by charging the least per passenger mile of
any light rail line in the nation. The fare on the Long Beach Line, indeed, is lower than
on parallel MTA express bus lines. While imposing distance-based pricing on express
buses, including those with parallel routes, MTA never has imposed distance-based fares
on the Long Beach Line. MTA has also forced local bus riders onto the Long Beach
Line by canceling and rerouting bus lines, replacing conveniently spaced local bus stops
with Long Beach Line stops that average a mile apart.
613. MTA opened the Green Line, which runs from Norwalk to El Segundo in
the central median of the Imperial Freeway, 1-105, for service in 1995. The Green Line
is unusual for a rail line because it is not located in a heavily-traveled corridor. The
Green Line, unlike the Long Beach Line, did not replace any pre-existing express bus
line. In order to obtain ridership, MTA modified many surrounding bus lines to divert
riders. The Green Line terminates within sight of — but does not reach — the Los
Angeles International Airport. The Los Angeles Times has appropriately referred to the
Green Line as “the train to nowhere.” The Green Line, which cost approximately one
billion dollars, was finished only with the infusion by MTA of $300 million in
discretionary highway improvement funds that could have been used for high occupancy
vehicle and busways. According to former MTA CEO White, these “activities . . . . are
more desirable than the Green Line today” because they provide greater congestion relief
for the region than rail construction.
614. MTA is currently proposing another light rail line, the Pasadena Line,
from downtown Los Angeles to Pasadena. As noted above, MTA projects that the
Pasadena Line will have the highest white ridership, 37%, and the lowest minority
ridership, 63%, of any MTA-operated rail line. In planning the Pasadena Line, the MTA
did not consider any bus alternative. The budget for the Pasadena Line was found in
1995 to be “without precedent in the industry and does not appear to be warranted by the
complexity of the project.”
615. At the same time that the MTA Board voted to raise fares and eliminate
G:\mta\mcdiatc\rg-bliss 224
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
the monthly bus pass in 1994 purportedly for lack of funds, the Board voted to use
discretionary highway improvement funds for the Pasadena Line. Former MTA CEO
Franklin White, in fact, has characterized the Board’s decision to proceed with the
Pasadena Line under such circumstances as “idiocy.” MTA has spent approximately $153
million on the Pasadena Line since 1994. In February, the Board voted to proceed with
the Pasadena Line, at a further cost of $832 million with a substantial portion to be
financed through the issuance of bonds using discretionary sales tax revenues as
collateral.
616. Instead of expanding the use of cost effective commuter buses, MTA
developed Metrolink, a suburban commuter rail system. RTD studies showed that the
travel time on commuter buses was shorter and the fares lower than on Metrolink.
Metrolink currently carries 18,000 riders a day. Any one of the MTA’s 20 busiest bus
lines carries more than that number.
617. The construction of the Red Line, which is currently projected by MTA to
cost $5.8 billion dollars, has been marked by cost overruns, incompetent management
and route changes that cannot be justified on any grounds but political exigency.
618. The record also indicates that the MTA Board has been repeatedly
criticized for its management of public transit. Former MTA CEO White called the
MTA a “money train” run for political considerations. He called the MTA’s original 30-
Year Long Range Plan “junk” with a rail line in practically every district of every
member who voted for it. City of Los Angeles Mayor Richard Riordan has called for
the replacement of elected officials on the Board, stating that it is “impossible” both to
develop rail projects and operate the bus system and that the present structure had
“inherent conflicts faced by politicians as they juggle the interests of multiple
constituencies.”
619. The record also shows that the downtown business district, with only 6%
of the region’s jobs, no longer justifies a radial, fixed commuter rail system. Commuter
buses better serve regional transportation needs at lower cost than rail. Bus operations
G:\mta\mediate\rg-bliss 225
i&y*~
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
1 have a greater impact on regional economic development than rail projects.
620. The record also shows that the 1 9 9 4 fare restructuring was not, as MTA
contends, justified by a budgetary shortfall. The District Court has found that the MTA
Board concurrently allocated what eventually proved to be over $ 1 5 0 m i l l i o n hi
discretionary funds. MTA has since modified the rail construction program to eliminate
hundreds of millions of dollars in avoided costs. The Board had available to it
discretionary funds to avoid any fare restructuring. The MTA Board committees that
studied fare restructuring did not in fact recommend it. The Board was presented with
no option other than to restructure fares. There was massive public opposition to the fare
increase.
CONCLUSION
621. Defendant MTA has engaged in a systemic violation of the rights of
minority MTA bus riders in violation of Title VI and its regulations, 42 U.S.C. §§ 1981
and 1983, and the Fourteenth Amendment. A remedy of broad scope is required.
Dated: October 24, 1996 Respectfully submitted,
Elaine R. Jones
Director Counsel
Theodore M. Shaw
Robert Garcia
Bill Lann Lee
Constance L. Rice
NAACP Legal Defense and
Educational Fund, Inc.
E. Richard Larson
Mark D. Rosenbaum
ACLU Foundation of
Southern California
Paul L. Hoffman
Gary L. Bostwick
226