Audit: MARTA should privatize some services, tinker with employees' benefits, possibly sell naming rights to stations
KPMG says MARTA's current economic model is 'structurally unsustainable'
So there's good news and bad news.
We'll give you the bad news first. One of the country's top auditing firms says MARTA's current economic model is "structurally unsustainable" and in need of "significant and fundamental changes" to avoid additional cuts to an already skeletal transit system. Says MARTA about the report issued yesterday by KPMG, which the transit agency's board hired last year to examine its operations:
As part of its analysis, however, KPMG found that MARTA’s current economic model is “unsustainable” therefore requiring the agency to cut expenses by $25 million annually. Among the other key findings:
- MARTA is projected to exhaust its reserves by FY 2018, and will fall below its mandated reserve levels by FY 2016
- MARTA has an estimated $7.1 billion in unfunded capital needs through FY 2021
- High rates of employee absenteeism cost MARTA about $11 million annually in additional benefits
- MARTA’s annual retirement costs are $22 million more than the national average in the public and private sectors
In addition: KPMG says MARTA’s healthcare claim, retirement, and workers' compensation costs are $50 million higher than national averages. Moving away from legacy plans and reducing costs in those areas, the draft report says, could save up to $50 million each year.
So how does MARTA, which has laid off and furloughed employees, cut bus routes, increased headways between trains, hiked employee healthcare premiums, and probably even started working with the lights off cut even more from its budget and save itself from insolvency?