Caltrain may have a path forward on 3-county governance decisions

At a board governance workshop on Thursday, the Caltrain board may have identified a narrow path on an agreement about how to run the 3-county partnership, while creating space to participate in the regional discussions on rail and transit governance.  

The issues debated included how the Caltrain management will be accountable to the Caltrain board; how the Caltrain board can have transparency and accountability for services performed for the agency; and how SamTrans will be repaid for its 90s purchase of the rail right of way.

Caltrain is governed by partners in the three counties it serves; representatives in San Francisco and Santa Clara Counties have been wanting to see more independence from SamTrans, and the San Mateo County Transit District (SamTrans) which has served as managing agency since it put up the funds to buy the right of way, takes pride in its history of running Caltrain, and has wanted less change.

The board discussion clarified how the parties see their goals, which may make it possible to reach an agreement. During an earlier recession, SamTrans accepted partial repayment for its purchase of the rail right of way, and was granted the ability to be the managing agency for Caltrain “for as long as it chooses.”

Board Director Stone, who also sits on the SamTrans board, articulated that the perspective of SamTrans is that being the managing agency means being the employer of all employees (including the executive director).   For Santa Clara County and San Francisco, having an executive director accountable to the board is a fundamental requirement.

Director Heminger from San Francisco (who had negotiated the earlier deal when he was executive director of MTC), may have found a path out of a potential impasse in articulating that as long as the Caltrain board plays the leading role in hiring, evaluating, and firing the ED, then which agency’s name is on the check is of lesser importance. In response to Heminger’s questions, Acting ED Michelle Bouchard explained that there are over 80 employees working solely on Caltrain reporting to her. Technically they are SamTrans employees, but Carter Mau, the SamTrans GM, has delegated to Bouchard the power to manage the team.

To SamTrans’ perspective, the San Mateo County agency purchased the ability to remain the managing agency by forgiving some of the ROW repayment. In Stone’s words, “We bought that right for $38 million, and if that goes away, we need to be repaid, going back to 1991, with interest.” Heminger, interestingly, agreed with the formulation that SamTrans had purchased the ability to serve as managing agency. 

So, some sort of agreement where SamTrans remains the employer, with legal ability to intervene in executive hiring and firing; while a process delegates goal-setting to the Caltrain board, could possibly satisfy the seemingly contrasting requirements.  In practice, if SamTrans were to step in and fire a Caltrain ED that a majority of the Caltrain board thought was doing a good job, it would trigger a constitutional crisis that could disband the joint powers agreement.

At one point in the sometimes-tense live negotiations, two of the board members with the fiercest positions in the debate (Stone and Chavez) proposed to send the discussions back to the three separate county agencies, a setup where it is almost impossible to reach agreement (as with the initiative to get Measure RR on the ballot, where 3 boards with different interests needed to take identical actions within a few weeks).

Instead, by the end of the meeting, the board delegated to Acting ED Bouchard to work with her staff and the executives of the partner agencies to craft alternatives that could “thread the needle” to address the different goals of the partner agencies, and bring those back to the Caltrain board.  If the Caltrain board agrees, a memorandum of understanding would be presented to the three county partners.

All of the board members agree that repaying SamTrans is an important piece of the picture. The financial negotiation may affect the details of the agreement. In Heminger’s words,  “We owe at least $20 million. To buy more independence, we may owe more than $20M.”  

Bouchard will present the proposals to the Caltrain board at the regular board meeting on Thursday, November 4. 

Meanwhile, while Bouchard and team work on possible solutions, the board will take its next scheduled governance workshop on October 22 to talk about participating in regional governance processes that are moving forward.  There is a Business Case Study of network management options moving forward at the regional level, as a follow-on to an MTC-convened Blue Ribbon Transit Recovery Task Force. Also, there is a Regional Rail study moving forward, looking at questions of regional rail governance and megaproject delivery.  

These regional governance discussions deal with multiple important goals of Caltrain’s business plan that Caltrain can’t achieve alone, including better coordination with regional and local transit, regionally significant megaprojects including the downtown extension in San Francisco, Diridon station, and corridor capacity improvements to support megaregional and state travel.