The Caltrain board governance resolution

An agreement among Caltrain’s governance committee members (Chavez, Walton, Pine and Heminger) may have brokered a deal allowing the Caltrain tax to be put on the ballot.  The agreement is along the lines that Directors Heminger, Bruins, Davis and Zmuda had suggested at the last Caltrain board meeting – it puts the task of working on the next generation of Caltrain governance in the hands of the Caltrain board, instead of adding conditions to a ballot measure resolution.

The provisions of the proposed resolution for the Caltrain board are largely the ones that were included in the less-onerous version of the San Francisco resolution, except not added in the middle of the ballot measure resolution, and therefore much less legally risky and less confusing for voters to vote for.  Also, some logically and legally problematic wording was cleaned up, and an important provision was added regarding getting SamTrans paid back for money they have still not been repaid for purchasing the right of way back in the 90s.

Here are the provisions summarized, with annotation:

  • For the first two years, expenditures using the tax beyond the first $40 million of the tax would require a vote of 6/9 board members, instead of the usual 5/9 board members
  • After that, all funds will require a 6/9 supermajority vote until the Joint Powers Agreement governing document has been revised to the satisfaction of all 3 member agencies
  • Creates a timeline through December 31, 2021 to revise Caltrain “governance or procedures”
  • Sets a goal to reimburse SamTrans for its investment in Caltrain (which was glaringly missing in the provisions of the SF resolution, and one of the underlying causes of SMC board member forceful opposition)
  • Sets a goal of the governance outcome to enable the majority of the governing board to appoint the executive director.  (This will cause heartburn for the staunchest of advocates for the status quo; but Supervisor Pine has already agreed to it).
  • Requires the Caltrain board to appoint an independent counsel and auditor by November 30, 2020. 
  • Changes the provision to get an item on the Caltrain board agenda with the request of two or more board members (the carryover from a request by Supervisor Walton that was agendized at a later meeting than the Supervisor asked for)

A few comments:

Very interestingly, with an eye toward possible regional governance changes, the language mentions “JPB or successor governing board, or, if a larger regional rail authority is created that includes Caltrain, a majority of that agency’s board.).

One of the challenges in the timing to execute a change is that the splitting of Caltrain from SamTrans will require hiring not only a CEO, but a senior management team – CFO, head of HR, etc. That is a significant extra cost in a recession. Unless Caltrain service is woven into a larger regional rail, or regional transit agency.

The language cleans up the legal impossibility in the SF version that called for Caltrain’s Joint Powers agreement to be changed in a way that legally it can’t. Instead, it reasonably calls for the Caltrain Joint Powers Board to recommend a governance structure or procedure to the three member agencies

The language about getting SamTrans paid back is pretty squishy “the JPB will initiate efforts to reimburse the SMCTD…” and there are no numbers mentioned (what would be included in the payback above the $20million known outstanding is subject to interpretation and negotiation).  Because all parties are required to agree, that challenging negotiation is destined to happen. 

In the big picture, this seems like a major step forward at getting a tax to provide stable funding for Caltrain on the ballot, while setting a timeline for governance reforms. The supermajority conditions to spend money on Caltrain service and improvements are annoying, but don’t appear excessively onerous.

If this passes, the Caltrain board will need to take on the task that was before them already, to determine how the service should be governed and managed in order to achieve the goals of the Caltrain business plan service vision, with a higher ridership, better connected service, in a future that will be very different from the past.

What do you think? What details do you think are important here?  Because this resolution only needs to be passed by the Caltrain board, if there are small cleanups needed that are amenable to all three counties, they can still be integrated by Caltrain’s board meeting on Thursday.