Sunday, January 9, 2011

Caltrain Management and its Discontents

There needs to be far more discussion about what this article, below, is talking about. Friends of Caltrain and advocates of saving Caltrain need to understand that it's not helpful to provide them with more tax-based subsidies when this organization is unable to constrain it's self-indulgences. High-Speed Rail can no longer be counted on to pay for Caltrain's corridor upgrades. And even if they did, it would not solve Caltrain's operational budget deficit and potential bankruptcy problem.


With the current reduction of train service, is there also a reduction in personnel needs and costs? Does the headcount stay the same? It would appear that service increases and reductions as well as fare increases as are now in place are merely tweaking around the edges of the problem; more of a public gesture of belt tightening than an actual confrontation of the problem.


If there is any oversight and a requirement of accountability of Caltrain management, it is invisible.


In the private sector economy, when a for-profit organization loses income, the Board of Directors is obliged to hold the CEO accountable. (Sometimes they don't and the stockholders then raise a big stink about that!) Why is this not the case with Caltrain? Because it is a public agency? In that case, it ought to be accountable to the voters and that appears not to be the case.


A number of people have suggested a complete revision of the Peninsula Corridor Joint Powers Board (JPB). Their membership is currently appointed, three from each of the three counties on the Peninsula. That should be changed. There are 17 (?) towns along the Caltrain corridor. Each town should elect a representative to the JPB for a term of office. Furthermore, the JPB should have more authority over Caltrain management, rather that its current function as a rubber-stamp for the CEO.


There are several major deficiencies that need to be raised in any conversation about preserving Caltrain as the management organization for the commuter rail service on the Peninsula rail corridor. First of all, the organization must understand itself to be a commuter service. That should seem obvious. Now, Caltrain is schlepping people up and down the corridor as if they were an inefficient freight carrier, frequently with half-empty cars.


However, they have a long way to go in order to be integrated with other public transit modalities. Coordinated networking of this service is key to it's effectiveness. We're talking buses, shuttles, BART and all the other transit operators that currently are all going it alone, almost in competition with one another. That's wrong. The key to their success is their inter-connectivity.


The other major failing of Caltrain is that they persist in thinking of themselves as being in the railroad business. Hence, they believe their future success relies on hardware upgrades, like electrification. Contrary to their constant claims, capital development investments will not increase their performance as a public mass transit operation.


Yes, switching to more appropriate people-carrying technologies will improve the quality of the service -- cost-effective DEMUs come to mind -- but the key to their operation needs to be a focus on multi-modal connectivity, such as to and from each of their stations. To be sure, far greater flexibility in train-set length will optimize train capacity and that's economically smart. But that has to be accomplished within the context of a public utility service, providing the greatest good for the greatest number at the lowest cost.


As a conclusion, here are some words from Prof. Theodore Leavitt of the Harvard Business School, who pointed out that the failure or many organizations is with management at the top.


"The failure is at the top. The executives responsible for it, in the last analysis, are those who deal with broad aims and policies. Thus:


The railroads did not stop growing because the need for passenger and freight transportation declined. That grew. The railroads are in trouble today not because that need was filled by others (cars, trucks, airplanes, and even telephones) but because it was not filled by the railroads themselves. They let others take customers away from them because they assumed themselves to be in the railroad business rather than in the transportation business. The reason they defined their industry incorrectly was that they were railroad oriented instead of transportation oriented; they were product oriented instead of customer oriented."


http://hbr.org/2004/07/marketing-myopia/ar/1


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http://groups.yahoo.com/group/BATN/message/47757


Published Saturday, January 8, 2011, by the Palo Alto Daily Post


$100,000 club grows


By Ryan Thomas Riddle

Post Staff Writer


The payroll for the San Mateo County Transit District -- which

oversees SamTrans and Caltrain -- fell by 3% last year but saw

an increase in the number of employees who made $100,000

or more and its chief executive getting a raise,

according to salary data obtained by the Post yesterday.


Highs and lows


San Mateo County Transit District has 765 employees among its three agencies --

SamTrans, Caltrain and the Transportation Authority. Its payroll dropped from

$53.2 million in 2009 to $51.4 million in 2010. However, the number of

employee earning $100,000 or more jumped from 86 in 2009 to 91 in 2010.


But payroll down at transit agency


Caltrain spokeswoman Christine Dunn said the increase in salaries

for those employees was due to promotions, such as one she herself

received, and a 3.25% wage increase for union workers.


Deputy CEOs Charles Harvey and Virginia Harrington made

$218,644 and $204,334, respectively, last year.


But the highest-paid employee is General Manager and CEO Michael Scanlon, who

earned $323,643 in 2010. That's a 1.3% increase from his 2009 salary of

$319,381. On top of that, Scanlon receives an annual $24,000 housing allowance.


Dunn, who made $83,735 last year, said she couldn't comment on why Scanlon still

receives a housing allowance while making over $300,000. She said that was

decided by the board of directors.


Karyl Matsumoto, who sits on the SamTrans board, said the allowance was a perk

to pay for Scanlon's relocation to San Mateo, when he was hired in 1999.


Amtrak salaries


But SamTrans and Caltrain employees aren't the only ones making

$100,000 or more.


Amtrak operates the trains for Caltrain and pays the commuter rail's

conductors and engineers. It's payroll rose by 40% from 2006 to 2008,

when the rest of the country was in economic turmoil.


In 2008, there were 58 employees who made $100,000 or more,

whereas there were only seven in 2006.