BART says ad was paid for by the Warriors

By Allen Payton

Another campaign trick was played on Halloween, when Lafayette attorney Jason Bezis filed a complaint against BART for using public funds, on Monday, October 31st. He claims the government agency is using public funds to promote the bond Measure RR on the November ballot. fppc-complaint-against-bart-re-measure-rr-first-supplement-oct-31-2016

In an email about his complaint, Bezis wrote, “I just filed a complaint with the FPPC about BART’s video using Draymond Green of the Golden State Warriors to promote Measure RR ($3.5 billion BART bond measure).  I argue that BART is illegally using public resources to influence voters to vote yes on Measure RR.”

Bezis’ complaint states, “complaint concerns BART public resources used illegally to plan, produce and publicize a video featuring basketball player Draymond Green of the Golden State Warriors to promote Measure RR. On Friday, October 28, 2016, BART released a 31-second video titled ‘Draymond Says’ and an accompanying ‘news article,’ YouTube post, Facebook post, and Twitter post to promote the video. The BART video, BART World Web (sic) [Wide] Web homepage, BART ‘news article,’ BART YouTube post, BART Facebook post and BART Twitter post all contain the message ‘BART needs to stay safe and reliable.’

These communications paid for with public moneys by BART, a local governmental agency, unambiguously urge a particular result in the November 2016 election: they urge ‘yes’ votes for Measure RR, referred to on the ballot as ‘BART Safety, Reliability and Traffic Relief.’ These BART communications constitute ‘contributions’ or ‘independent expenditures’ benefiting the Yes on RR campaign (FPPC ID#1381218), officially named the ‘Committee to Keep BART Safe and Reliable,’ which uses the phrase ‘Keep BART Safe and Reliable’ in its campaign logo.”

Bezis then offered what he wants BART to basically admit they’re using public money to campaign for the ballot measure and to file the necessary finance reports for the expenditures.

His complaint concludes with the following:

“As BART has engaged in campaign activity, pursuant to Regulation 18420.1(f), the FPPC should require BART to file the necessary campaign finance reports for the direct and indirect costs of its campaign activities relating to promotion of Measure RR on the November 2016 ballot in Alameda, Contra Costa and San Francisco counties. BART needs to publicly disclose the value of public resources that it expended for campaign activities supporting passage of Measure RR as either a contribution to Yes on RR campaign or as an independent expenditure supporting Measure RR. For the “Draymond Says” video, BART needs to report as campaign activity the costs of planning the video, production of the video, and promotion of the video via YouTube, Twitter, its internet homepage, its BART “news article,” and by other means of publicity. If Draymond Green is a “paid spokesperson” for BART, then a Form 511 report must be filed.”

Bezis also provided evidence to support his complaint, which can be seen below.

When reached for comment BART Board Director Joel Keller responded “The complainant believes the District used public funds to promote a ballot measure and has filed a complaint with the Fair Political Practices Commission (FPPC). There is a fine line between education and advocacy and it is appropriate to wait for the FPPC’s response before discussing the merits of the complaint.  However, as a supporter of the Dub Nation and admirer of the heart and intensity of Draymond Green’s play, it’s too bad that the motivation for the video about the Warriors and BART has become controversial because it is a slam dunk.”

Kerry Hamill, BART’s Assistant General Manager for External Affairs said “We have had an ongoing relationship with the Golden State Warriors for years at BART.”

“We provide extra service to their games,” she continued. “They promote BART in a variety of ways, like this video, which they showed at one of their last pre-season games.”

“We did not pay for it. The District absolutely did not pay for it,” Hamill reiterated. “It’s the Warriors’ video and they used it to show during their pre-season game. They let us use it for BARTable, which is a website and a newsletter that promotes off-peak ridership to various games, activities, shows and festivals.”

“I really want the Warriors to be applauded for encouraging people to take BART to the game and get cars off the road,” she said. “It’s a lot safer and smarter to take public transit to a game, when you’re going to drink and party.”

“The Warriors and BART shouldn’t be attacked for promoting taking transit,” Hamill added. “People should take BART to the game.”

A source within the Yes on RR campaign said that “Bezis has a pattern of filing these complaints. He did this several times against the Measure BB campaign in 2014. The FPPC declined to even investigate them.”

The FPPC has 14 days to decide if they intend to investigate the complaint, refer the complaint to another agency, take no action either because the Commission doesn’t have the authority or the allegations do not warrant any further action.

The election is Tuesday, November 8th.

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By Allen Payton

In June, the BART Board voted 9-0 to place a $3.5 billion bond measure on the November ballot to provide funding for repair and maintenance of and upgrades to the existing system. The measure will appear on ballots in the three counties of Contra Costa, Alameda and San Francisco that make up the BART District, and requires a two-thirds vote to pass.

The system improvements will take 21 years to complete, according to the brochure about the measure. To see the brochure, click here: BetterBART_Brochure

“BART anticipates that the 2016 System Renewal Program Plan will be implemented over the course of twenty-one years, commencing in Fiscal Year 2017 and concluding in Fiscal Year 2038. Projects will be accelerated as practical to maximize the benefit of planned improvements as quickly as possible.”

However, the bonds will take as long as 50 years to pay off.

“We’re not likely to sell $3.5 billion of bonds in the first year or even the first 10 years,” stated BART Director Joel Keller, who represents Concord and Eastern Contra Costa County.  “There are laws that you spend bond proceeds before you issue more bonds. What we’ll do is sell the bonds in what’s called tranches. Let’s say the first tranche is $1 billion and it takes us five to 10 years to spend that money. That tranche will last 30 years. If we do that three or four times, that could take the final payment out years. That’s really an unknown. It could take 40 to 50 years. It will be 30 years after the last bond is sold.”

According to a BART press release, “Estimates show the bond will cost Alameda, Contra Costa and San Francisco county homeowners less than a pack of gum a week.” More specifically, the cost will increase the average property tax bill by $37.21 per year in Contra Costa County if the measure is approved, according to Keller.

The annual cost is based on the appraised of property values, both residential and similar to the BART earthquake retrofit bond measure, which is what property owners are currently paying on the property tax bills.

For the BART earthquake safety measure, which voters approved in 2004, the projected annual cost was between $4.85 and $12.65 per $100,000 of assessed value. However, the actually cost was $2.60 to $9 per $100,000 of assessed value.

“It’s an ad valorem tax with a fixed cost to pay off the bonds,” Keller explained. “So, if property values increase, the cost per $100,000 decrease.”

The 2016 bond measure is projected to cost $8.98 per $100,000 of assessed value. So a property in Contra Costa County with an average value of $414,399 will be assessed $37.21 per year.

Use of Bond Proceeds

The use of funds from the bond measure is split into two categories, according to the BART System Renewal Program Plan 2016.

Repair and Replace Critical Safety Infrastructure – $3.165 billion, 90.43%

“We want to upgrade our computer equipment from Pong-era technology to a modern train control system—which means less waiting for trains on crowded platforms and less frustration from delays. New maintenance facilities will keep the maximum number of cars out serving customers, so that fewer cars clog our congested highways,” from “The Plan” brochure about the measure.

This category is further divided into six sub-categories, with explanations in the brochure.

Renew Power System – $1.225 billion, 35%

Replacing Worn Track – $625 million, 17.85%

Waterproofing & Repairing Tunnels & Structures – $570 million, 16.29%

Modernizing & Replacing Train Control – $400 million, 11.43%

Renovating Stations – $210 million, 6%

Renewing Mechanical Infastructure – $135 million, 3.86%

Safer Station Access – $335 million, 9.57%

Design Future Projects to Reduce Crowding & Reduce Traffic Congestion – $200 million, 5.71%

Expand Opportunities to Safely Access Stations – $135 million, 3.86%

The bond measure brochure clearly states No general operating expenditures: The proceeds of the bond measure cannot be used to support BART’s general operating needs, but must be dedicated to the capital program outlined in this Program Plan.” Therefore none of the funds can be used for employee salaries or benefits.

According to a press release from BART:

The bond measure is a key funding component of BART’s plan to rebuild and renew its aging system, which faces increasing problems as various physical parts of the 44-year-old railway reach the end of their useful lives.  The plan replaces and repairs 90 miles of deteriorating tracks and other aging infrastructure in order to maintain BART’s excellent safety record and protects our environment by keeping thousands of cars off the road.

“This bond measure is practical; it’s dedicated to fixing what we have,” said Board President Tom Radulovich. “We have a responsibility to keep our system safe and reliable while getting the maximum value out of taxpayers’ investment.”

Over the past year, BART’s community outreach department has held over 230 community meetings with local stakeholders and civic groups to ensure widespread understanding of BART’s needs, and to hear the public’s thoughts about its capital reinvestment program.

Due to record-breaking ridership, BART has been able to find funding for many of the solutions needed to increase capacity, meet modern demand, relieve crowding, and upgrade the system.  That includes the newly arriving Fleet of the Future, the Hayward Maintenance Complex, and some of the groundwork for a cutting-edge train control system.

However, the cost of the capital projects needed to repair, fix, and replace worn rail, leaking tunnels, unreliable track circuitry, and failing power transmission equipment outpaces revenue growth.  BART’s plan is to dedicate funds from the bond measure solely to fixing what we have first – without earmarks, pet projects, or frills.

If voters choose to pass the measure in November, great care will be taken to ensure the public’s money is protected and spent wisely.  An independent audit committee will be commissioned to publish regular, transparent reports on how the money is being spent, with open, frequent and public meetings.

BART has proven itself to be a prudent and effective steward of public bond funds in the past, executing its 2004 Earthquake Safety and Retrofitting effort under budget with better and more robust results than expected.

Public transportation continues to be at the intersection of many of the great issues facing cities in the 21st century – and voters were wise in choosing to build such an extraordinary work as BART back in 1962.  Since then, BART has been a staple of this region’s culture, workforce, and values. As both riders and service providers, BART appreciates and is deeply grateful for the opportunity to connect residents to the people and places they care about.

Kerry Hamill, Government Relations Manager for BART offered additional comments regarding the cost and length of the bond measure, in response to an editorial by Dan Borenstein published in the East Bay Times:

The East Bay Times editorialist’s headline – that our bond measure will cost double what we are saying – is flatly incorrect, a conclusion drawn from a selective interpretation of our analysis. In order to assist BART’s Board of Directors in making an informed executive decision, a variety of scenarios were created with different variables relevant to particular presentations. The East Bay Times piece incorrectly appropriated data from these scenarios, resulting in an inaccurate characterization of the bond’s effects. BART has long taken care to illustrate the repayment structure of this bond in a standardized way; we have been doing so through all our exhibits and resolutions since the Board discussions began in earnest this past February.

The editorial also takes issue with how staff described the bond to the Board of Directors and the public, claiming we provided inaccurate information out of either incompetence or deceit – a charge which has absolutely no merit. Bonds are issued over time in subsets called tranches, each lasting 30 years (hence the name ’30-year bond’). This is done to coordinate the timing of bond issuance as closely as possible with construction progress payments, which minimizes interest costs and keeps the annual tax rates as low as possible – a prudent and responsible financial management practice. The editorialist was given this point of clarification multiple times as he repeatedly misrepresented the meaning of a ’30-year bond’ to mean the total span of time property owners would be paying – a false claim BART has never made. We were disappointed to see the author’s misunderstanding make the final printing, despite our best efforts.

The bond measure is projected to cost between $0.80 and $17.49 per $100,000 of a property’s assessed value, for a weighted average of $8.98 per $100,000 over the life of the bond – and for further explanation, that minimum and maximum range is based on the structure of BART’s projected debt service. The editorial’s repeated point that BART made a mathematical error in not compounding the increase in AV is also flatly incorrect, based on a misunderstanding of how the cost of bonds increase or decrease over time. The more the District’s assessed value increases (as housing supply, ownership changes, improvements increase), the lower the rate property owners would pay as the cost is spread over a larger base of assessed values. Furthermore, our models and estimates are built on the assumption of a 4% yearly increase in assessed value. $3.5B Scenario C Tax Rate At 4% AV Escalation

This is not our first bond – when the Earthquake Safety measure went before voters in 2004, the District projected that rates would vary between $4.85 to $12.79 per $100,000 of a property’s assessed value. Since approval, the actual annual cost has ranged between $2.60 (current year) and $9.00 per $100,000 of assessed value. Contrary to popular opinion, we have a proven track record of responsible fiscal stewardship. $3.5B Bond Financing

Concerned property owners are encouraged to do their own math for the sake of accuracy: $8.98 per $100,000 of assessed property value. When we provide averages for particular scenarios, we run the risk of appearing to conceal changes in amounts due to the many variables that can be introduced. Our goal is to provide people with a general understanding of a complex issue based on the best information available, which we have done and will continue to do. We are a transparent organization with deep ties to the community, and have held hundreds of meetings to ensure people understand what this bond is and how it will work. In that vein, we appreciate the opportunity to draw attention to our plan to rebuild the core of the BART system for improved safety, reliability, and traffic congestion relief.

Complete details of what is in the bond and how it relates to safety, reliability, and relief of traffic congestion can be found at bart.gov/betterbart.