Can Caltrain grow up to bring about the vision of high-ridership, all-day, integrated service

Caltrain’s draft business plan includes a commissioned organizational assessment to evaluate changes needed in order to achieve a service vision that would: 

  • Triple the ridership or more
  • Provide 15 minute all-day service
  • Provide “Show up and go” clockface schedule 
  • Enable more coordination with local, regional, and megaregional transit
  • Provide a “show up and go” clockface schedule
  • Enable more coordination with local, regional, and megaregional transit

“The status quo is no longer viable”

The assessment concluded that until now, Caltrain has been performing in the top tier of similar organizations, with double the passenger miles per employee compared to peers.

But it also concludes that “But the status quo is no longer viable…. Caltrain has already embarked upon a path that requires significant organizational change. 

Robust choices, light on decision support

The report includes sections on staffing, management, and governance.  It has rich detail on the sorts of jobs and departments that are needed to manage a rail service with higher ridership, a more complex schedule, and major construction projects. 

The report also describes a variety of different choices for how to oversee and manage Caltrain. However, report does less to actively help board members, stakeholders, and members of the public to evaluate the different options.  

Decision support needed- evaluate options based on goals

It’s understandable the report doesn’t come right out and tell Caltrain how to re-organize itself. If the report did clearly pick alternatives before stakeholders had a chance to weigh the choices, any recommendation would likely be rejected.

But it would be helpful for board members and community stakeholders to be able to evaluate options in the context of the goals of the service vision, considering capabilities that need to mature and improve in order to be able to reach those ambitious goals.  

In order to achieve the service vision, Caltrain needs resources and capabilities that it doesn’t have yet at the level required, and that the Bay Area region doesn’t have sufficiently. These needs and capabilities include:

  • Stable funding for routine budget needs 
  • Ability to fundraise for multiple phases of growth.
  • Effective planning and delivery of major capital projects and programs such as the Downtown Extension, Diridon Station upgrades, corridor grade separations and more.
  • More robust service coordination with BART and other components of the transit network.  
  • Planning and managing major station projects and real estate development initiatives
  • More explicit goal-setting and accountability to review progress in an era of expected continual change

The different organizational options outlined in the report vary in their ability to address these capabilities. It would be helpful for decision makers to have a facilitated process to consider how the different options help achieve these and other goals.

Decisions need policymakers, stakeholders, and multiple steps 

As Caltrain embarks on the next stage for the organization, the report recommends moving ahead to evaluate the governance structure, which is currently constructed as a Joint Powers Authority, governed by a Joint Powers Board made up of representatives from agencies and jurisdictions in the three participating counties. The board gives direction to an agency that is managed by San Mateo County Transit District (SamTrans.) 

The report lays out several logical options including 

  • the status quo
  • improvements to the Joint Powers Board oversight and accountability
  • hiring standalone management separate from SamTrans
  • creating a special district (like BART) with a standalone board and separate management.

However, the report asserts that the topics of funding stability and fundraising should be dealt with separately from management and governance options. Based on observing the functioning (and occasional dysfunction) of Caltrain as it is governed by a Joint Powers Authority, the organizational structure options cannot be assessed without considering whether any solution can enable funding stability and effective fundraising. 

The report correctly observes that Caltrain has an unstable funding structure. Budgets are drafted annually, contributions are provided by member agencies on an annual basis; when any of the member agencies have periodic fiscal challenges, this can lead to service cuts and/or fare increases, and to skimping on needed basic maintenance. And the annual budget can be and has been used as negotiating leverage for goals of the partner agencies. 

Similarly, fundraising is unstable. Caltrain’s Joint Powers Board does not have the power to decide to put a tax measure on the ballot, and current legislation requires unanimous consent of 7 boards to put a tax measure on the ballot.  Earlier this year, the Caltrain board contemplated a sales tax for stable funding. A Caltrain-specific tax may be superceded by a much larger regional transportation measure that would fold in Caltrain needs. But it might also take longer to put together a complex measure for the entire region, and if so, it would be helpful to have a backup plan for a dedicated tax.

Unfortunately, and ironically, the requirement for a unanimous 7-board vote for fundraising currently has the backup planning for a standalone measure on hold. The need for consent by all 7 boards currently is being used as negotiating leverage for various aspects of governance change.  For example, a proposal from the San Francisco Board of Supervisors called for the hiring of a separate corporate attorney for Caltrain as a pre-requisite for approving putting a measure on the ballot.  

On the one hand, having a separate attorney is a logical step for several reasons outlined in the organizational assessment. The organization needs to beef up staff for many functions, and has specialized legal needs for roles such as crafting corridor management agreements for Dumbarton and High Speed Rail.  And since the governance assessment considers options that may or may not retain SamTrans as managing agency, it makes sense to have separate legal advice regarding those options.

Separate legal council for Caltrain seems logical for several reasons, as part of capabilities needed to manage an increasingly complex operation. It is a symptom of the structural instability and the need for increased organizational maturity that JPB members are using the requirement legal counsel as leverage to hold up funding.

In summary, funding stability and fundraising capability must be a part of the near-term discussion of governance options. Therefore, policymakers involved in funding and fundraising need to be part of the evaluation process, not only senior staff.

Given the complex issues, it makes sense for the evaluation process to include senior managers, and policymakers, with professional support from domain experts and strong moderation for conversations about sensitive topics. 

Expecting multiple phases of change

As with the plan for capital improvement and service expansion, the plans for maturing the organization will need to take place in multiple phases.  The concept of an organization that periodically changes to take advantage of new opportunities is familiar in the private sector. The practice of periodically considering and making decisions about organizational change is one of the many competencies that will need to be developed to achieve the service vision. 

“Non-self-directed options” – initiative needed sooner rather than later.

The organizational assessment also looks at a variety of what it calls “non-self-directed options” – choices that go beyond Caltrain’s current scope, and could provide capabilities where the broader region – not just Caltrain – needs improvement. Logical options include improved cooperation among existing agencies, integration of key functions (Option G, which could include centralizing functions such as the construction of megaprojects, or the management of regionally coordinated fares), as well as various sorts of consolidation among agencies (Option H, an authority that oversees multiple railroads, and Option I, rail agency consolidation) . 

The report concludes that non-self-directed options are long-term in nature, pertaining to future stages of the evolution of the service vision, and therefore can be deferred to a later date. “”At this time, there are too many unknowns to determine the optimal strategy to deliver the 2040 service vision. A long term decision is best made in future in conjunction w/progress on implementing key projects and services outlined in the vision.”

However, the set of “non-self-directed options” include some time-sensitive needs and opportunities, including 

  • Managing megaprojects – the governance review of the Transbay Program has the potential to be shaped as start of regional construction authority. Similarly, the pipeline of grade separation projects also has the potential to be managed by a construction authority. 
  • Fare integration – the region is moving forward with business case for integrated fares
  • Service integration – electrification creates new opportunities to coordinate schedules with BART and with feeder transit. 

In order to take advantage of opportunities that are moving forward in the near term, the Caltrain board should set near term policy direction regarding goals, and to encourage active participation in these regional initiatives to advance the goals.