The SMART train project has reached a critical junction between progress and public perception.
In Petaluma, maybe 50 yards from the stretch of rail along Lakeville Highway at East Washington, a locomotive hulk wearing the legend 3804 North Coast Rail Way sits quietly as time and weather labor at stealing its dignity. Thieves have already made off with all its copper. A caboose that at one time ran for Union Pacific keeps it company, warning the curious away, using a combination of no trespassing signs, tangles of wild licorice plants and the occasional empty whiskey bottle.
The buildings adjacent to the railway relics are pristine, painted a yellow more mellow than bright. They currently house the Petaluma Visitors and Art Centers, but when the Sonoma Marin Area Rail Transit (SMART) train gets here, the place will turn into the downtown Petaluma rail station.
Right now, however, the scene is symbolic of the struggle of the SMART. Like the aging locomotive and caboose sitting next to the polished station, SMART seems to be stuck in the past, even as the present beckons with promise of better things.
Since voters in Sonoma and Marin passed a measure setting up a sales tax funding mechanism in November 2008, the effort to put a train on the tracks has been besieged by fits and starts, cost overruns and financial shortfalls. Train critics say it’s also been plagued by lack of discernible progress and a shortage of public transparency.
Internally, the project has become a magnet for consultants. “Lillian [Hames, former SMART general manager] initially brought on many former colleagues who were consultants she’d worked with in Portland, and they did some good work. But for longer-term organizational structure, you can’t have consultants overseeing consultants, it doesn’t work,” says Judy Arnold, a Marin County supervisor and a vice-chair of the SMART board of directors.
Arnold is echoed by Valerie Brown, a Sonoma County supervisor and chairman of the SMART board. “There was a sense that when a new position was needed, another consultant was hired,” Brown says.
A resident of Greenbrae in Marin, Hames resigned her position last January, two days after the board met in closed session to discuss her job review. There was a fair amount of chatter over whether she jumped or was pushed from the big chair; at the time, it was said she left SMART to pursue other career horizons. Nobody associated with SMART wanted to talk on the record about the split other than saying Hames left on her own and it was a personal matter.
Hames had reportedly done a good job in Portland, a place with a formidable public transit system, and she was the key player in SMART for a decade. Hames declined to participate in this story by not returning emails or phone calls.
Her departure has given SMART something of a fresh start. Chief Financial Officer David Heath pinch hit for a while as interim GM before being succeeded on a temporary basis by Farhad Mansourian, the gent who’s director of public works for Marin County. At this writing in June, the search for a new general manager is ongoing.
Money woes: dollars and sense
While the hiring of a new chief is a priority, SMART has larger concerns—like math. The organization has pegged the cost of constructing the entire 14-stop rail transit system at $695 million, up from the $541 million estimate used when the sales tax measure was passed in 2008. Originally, sales tax revenues over 20 years were projected to raise $890 million. But that figure has changed as well, decreasing to $750 million according to SMART, thanks to the economic crunch that started in 2008. The combination of decreased revenues and increased costs has put SMART on the spot. While the worst economic downturn since the Great Depression and resultant fallout can’t be blamed on the rail organization, the increase in cost projections has given critics more red meat.
Moreover, it’s left SMART with a funding shortfall and has decreased the amount it can expect to raise on the bond market. At first, it was thought that cuts were the way to go. Thus a decision was made to shorten the project up. SMART proposed to run the train from Santa Rosa to the Marin Civic Center in San Rafael, lopping off Windsor, Healdsburg and Cloverdale to the north, and chopping downtown San Rafael and Larkspur to the south. This scenario didn’t play well in Marin or with the Metropolitan Transportation Commission (MTC), and a new plan to extend the initial southern terminus further south to downtown San Rafael, where there’s an existing bus transit hub, was hatched.
The drastic changes in both budget and project have one group questioning whether it’s time to go back to the people and ask if this is the SMART train they want. RepealSMART, a grassroots coalition of residents from both counties, has put SMART on notice that it intends to circulate a petition to qualify an initiative that would repeal the sales tax that provides funding to SMART. It may also ask voters whether they want to disband the transportation district that allows SMART to operate legally.
Novato resident John Parnell, one of the founders of RepealSMART, says the group isn’t anti-train. “I voted for SMART. I rode the ‘T’ in Boston and the subway in New York. We’re for public transit. But this [SMART] isn’t what we voted on. And if this is how they want to proceed, they should ask the people if it’s what we want.”
Parnell thinks his group will have to gather a little more than 40,000 valid signatures to force SMART to answer to the voters.
With $88 million chopped in costs, the transit system is still $21 million away from a place where the immediate funding gap would be zero. The MTC, the Bay Area-wide organization charged with distributing some state and federal transportation funds, has agreed to chip in $10 million if Marin and Sonoma can come up with the remaining $11 million.
As the late Senator Everett Dirsken once said, “A million here, a million there, and pretty soon you’re talking real money.”
Sonoma County, or more to the point, the Sonoma County Transportation Authority, has said it will kick in $3 million (in addition to the $11 million it already contributed from Measure M revenues), and Marin needs to cover $8 million. MTC would like the Transportation Authority of Marin (TAM) to pony up.
While $8 million may not seem like a lot when you stack it up against the $695 million total cost, it’s a lot of money because of a move that was made to get the measure passed in 2008. At the time, there were concerns that, despite SMART having its own quarter-cent sales tax funding, the agency would compete with Marin for local transportation dollars.
The most vocal voice for keeping SMART out of the local cookie jar was Marin Supervisor Susan Adams. Adams wasn’t a believer in the train, but she was perhaps more concerned that SMART would cannibalize local funding, and so a political compromise was struck. The “Adams Amendment” called for SMART to agree not to go after the same transportation funding as TAM (specifically, no funds assigned to Marin County projects in either the T-2030 or T-2035 Regional Transportation plan documents). In exchange, Adams agreed to stay out of the campaign—no small thing, considering the train had lost in three previous political outings and Adams is a county supervisor with some degree of political clout.
Trust and public accountability
But now, SMART has come calling, asking TAM to come up with the $8 million—and the majority of its members look ready to kick in the cash. Although the proposed funding sources are outside the criteria of the Adams Amendment, this request doesn’t sit well with Adams or critics of the train. Having TAM cover the bill also has raised hackles with some Marin residents that look at local bus service and potholes as areas where those funds should flow instead.
Adams has been quoted publicly that, should TAM come out of pocket for SMART, the agency will have problems. “I think there’s going to be an issue of trust and public accountability,” she said in May. Adams has a point, but some observers of SMART would argue she’s a little late to the party.
On the other hand, little is easy where SMART is concerned. On June 23, TAM met and took public testimony for three hours regarding whether its board would approve making the $8 million payment for SMART. At the end of the debate, the board vote deadlocked at 7-7. After the vote, much of the crowd picked up and went home, figuring the board would take up the issue again on another night.
That’s when things got interesting. Coming back from a break, Joan Lundstorm, a board member of from Larkspur, announced she’d had a change of heart and wanted to vote in favor of the $8 million contribution, because she was afraid a pedestrian bridge over Sir Francis Drake Boulevard to the Larkspur Ferry Terminal could be scuttled.
The board conferred with a counsel as to the legality of taking another vote and then it did. With Lundstrom switching her vote, the tally became 8-6 in favor of giving the needed $8 million to SMART.
After that, however, TAM Chairman Steve Kinsey nullified the second vote because so much of the public had left after witnessing the initial tie vote. Kinsey represents West Marin on the county board of supervisors and is chairman of the MTC. West Marin is the last bastion of what Marin once was—agricultural, independent and willing to go 12 rounds when it appears the government isn’t playing straight up. He’s smart, has good instincts and is willing to fight hard (but unwilling to join in fights he knows are deadbang losers). Kinsey called it a night by saying the vote would be rescheduled as a special meeting and the public would be invited to weigh in once again.
Letting the sun shine in
“I know there’s a question out there, for some in Marin and even Sonoma, whether voters will get what they voted for. People weren’t really brought along very well. There were three years of not getting in front of our message and a need for greater transparency. SMART meetings are held during the day, and once the campaign was over, SMART needed to do a better job of keeping the public up-to-date on what’s going on,” says Supervisor Arnold. She mentions that the board’s meetings are now webcast and available online. “That’s the first step. We have to continue to make every effort to let the public know what we’re doing going forward,” she says.
SMART had previously been accused of having something of a “bunker mentality” that seemed to be a carryover from the hard fought 2008 campaign. Despite hiring Chris Coursey, a columnist from The Press Democrat, to act as spokesperson for the train agency, SMART has still struggled to keep the public informed. Said one insider familiar with the district’s struggles, “It wasn’t [Coursey’s] fault; the district wasn’t that interested in keeping in touch after the election. It seemed like months of trying to figure out what was the most important thing to do, getting organized and then there didn’t seem to be much progress. And you don’t really want to call attention to the fact that your financial projections have all gone to hell a month after you won the election.”
Coursey left SMART this past May for personal reasons according to Katherine Puliafico, executive assistant at the agency. “Chris left for his own reasons, there were no budget cuts. We were all really sad to see him go,” she says.
Budget and bonds
David Heath didn’t sign on to be SMART’s general manager, but there was a better reason for moving him back to his own desk, and it has little to do with bringing Farhad Mansourian in. Heath is, by trade, a numbers guy who knows his way around a balance sheet about as well as Tim Lincecum knows his way around a pitcher’s mound. And the fact is, SMART needs to build a budget with revenue projections that Wall Street will buy so the agency can put a bond offering together. The budget not only needs to be rock solid and stand up to scrutiny from investment banks, it also needs to stand the test of time. In some public circles, there’s doubt in SMART’s ability to come out of the financial hole and bring the public along so that the train is regarded in a positive light.
“The fact is that David reached a point where he needed help,” says San Rafael Mayor Al Boro, a SMART board member. “The budget and the bond financing are a top priority, and he needed to stay focused on that. And now Farhad is here to serve as interim general manager.”
Mansourian has been in management at the public works department for 21 years, the last seven as director. He’s known to be a deft hand at juggling staff, cracking budgets and managing the sometimes choppy political waters at the Marin Civic Center.
So Mansourian is in a unique position that may work to the advantage of SMART. He’s the interim executive director, with the promise of his old spot back in Marin and the board of supervisors who will welcome him back to the fold. He doesn’t need to make friends with SMART staff or worry about forming long-term alliances. Essentially, he can walk in the door and begin setting a tone of getting things done from day one. “Farhad is quite capable of walking into any public works project, evaluating things, and then seeing to it that they get done,” says Arnold.
The board hopes to be in a position this summer of having the budget finished, a bond deal in negotiation and requests for proposals regarding construction out for bid. “We’re moving into a very critical period. We have a lot going on all at once, but I feel very good about the direction that we’re going,” says Brown.
Brown didn’t mention hiring a new general manager, but that’s in part because the loan of Mansourian allows Heath to get back to crunching numbers.
Hames impact
The board is working differently since Hames took her leave. “Lillian had a different style of dealing with the board. At times, the board was unclear of the magnitude of issues, because so many items were brought before us,” says Brown in a phone interview from her native Missouri.
A consultant to SMART who spoke on condition of anonymity said, “Lillian is a smart person and I like her. But she always seemed tired, and I wonder if that rubbed off on the board or the staff. She’d kind of sigh and tell you how tired she was. After the election was won, when there was some momentum and a chance to dive right in and make a splash, the first thing she did was go on vacation. Who does that?”
Not long ago, there was a meeting at Fireman’s Fund in Novato regarding a right of way not far from the insurer. The company was a big supporter of Measure Q and wants to see the train succeed, because it will make it easier for many of its employees to get to the office. Among the attendees were Steve Kinsey, David Heath, Judy Arnold, Novato city council member Carol Dillon-Knutson, North Bay Leadership Council CEO Cynthia Murray, and Doug Martin of Fireman’s Fund. At one point in the meeting, someone observed that such a meeting was unlikely to have happened on Hames’ watch. “She wouldn’t have wanted to put all those people in the same room to make something happen. That just wasn’t how she did things.”
Brown says she and Arnold talked about how things have changed. “Judy is from Kansas; she was a Jayhawk, and I’m from the ‘Show Me State’ of Missouri. You have a couple of Midwestern ladies in strong leadership positions.”
Arnold notes the difference is pronounced, “I noticed that David came in and took great pains to include the whole board, and that continues with Farhad as well. Without a full-time GM, the board really needed to come together quickly—and it has.”
“We’ve been through a lot of change since the beginning of the year,” Brown points out. We lost Charles [McGlashan], which may have helped us focus. We’ve sustained a lot of changes and are still moving forward.” (Marin Supervisor Charles McGlashan, a strong advocate for the train, died in March of a heart attack.)
Valerie Brown indicates that, while the board has seen changes, the next part of SMART that’s likely to see modification is the staff. “To a degree, we’ve had consultants doing things and now we need to modify that, though we could bring some on as staff,” she said. “Don’t get me wrong, the staff has been fine, but there’s a need for different things as we move into the design and build phase, which requires change.”
Brown chafes a bit when it is suggested that SMART has been chugging in place. “There’s a sense of urgency; I think the board is energized. We’re getting ready for design and the build by 2014.”
Brown and the rest of the board are going to have to get the staffing right, beginning with a general manager who gets it right from the start. The over-budget, shortened train has some of the public wondering if the train was a mistake. SMART made the tragic mistake of over promising and under performing. The train is going to need to get back on track quickly if it is to regain any of the public’s confidence.
Bill Meagher is contributing editor at NorthBay biz. He also pens the Only in Marin column. He’s covered regional issues in the North Bay including water, transportation and politics for two decades. He writes on alternative investments and commercial real estate for DealFlow Media in Petaluma and lives in San Rafael with his wife, Cindy, and Miles the Wondercat. He wishes the Giants could get healthy and hit the ball. You can reach him at bmeagher@northybaybiz.com.
