Mid-Year 2000 COP Performance Report

Introduction

In going before the region's voters in November 1996, the Sound Transit Board promised to be held to the highest standards of public accountability. As part of that promise, the Board committed to appointing a Citizen Oversight Panel charged with monitoring performance and reporting regularly on potential areas for improvement. Within two months of voter approval, the Board moved to begin a selection process for the Panel.

The Board specified that the Citizen Oversight Panel should consist of fifteen volunteer members, of whom at least two should live or work in each of the five Sound Transit district subareas. Panel members were to broadly represent the demographic make-up of the Sound Transit district and to include a wide array of skills and experiences necessary to perform its function. The Board appointed fifteen citizens to the Panel. Panel members may be appointed for up to two three-year terms.

COP met for the first time in April 1997 and has met every month since then. Steve Goldblatt served as the Panel's first chair from 1997 to 1999. In April 1999, COP elected Reid Shockey as its chair and re-elected him to a second term as chair in 2000. Art Carter was elected as vice chair in 2000. The Panel has developed and agreed to a set of operating principles. The principles include:

• Panel members agree to abide by the Sound Transit Board's ethics policy and to avoid even the appearance of conflicts of interest.

• Citizen Oversight Panel meetings are open to the public.

• Members provide a subarea perspective, for the subarea in which they live and/or work, as well as a district-wide perspective whenever issues of the whole region arise.

The Citizen Oversight Panel is independent of Sound Transit management. While accepting logistical support from the Sound Transit staff and reporting to the Board through the Finance Committee, the Panel has selected its own independent, contract staff person who is paid by Sound Transit. The Panel enjoys an open and cooperative relationship with the agency, but COP believes that an independent, arms-length status best ensures the fulfillment of its mission to monitor and report every six months to the Sound Transit Board and regional constituency.

This is the Panel's seventh semi-annual report and covers Sound Transit's performance in meeting its commitments during the first half of the year 2000. Our previous reports are available upon request and on the Sound Transit website at www.soundtransit.org. Brief biographical summaries of COP members are provided in the attachment to this report. Panel members welcome comments and input to their work and may be contacted by calling Kaye Munson at Sound Transit at 206-398-5021 or by writing to Citizen Oversight Panel, Union Station, 401 South Jackson Street, Seattle, WA 98104.

Citizen Oversight Panel Mission

It is the mission of the Citizen Oversight Panel to ensure that Sound Transit succeeds in meeting its commitments to the public by monitoring performance and reporting to the Board on potential areas for improvement. Areas to be monitored will address:

• Sound Transit's adherence to its public commitments,

• the open and timely involvement of citizens in the Sound Transit district in decisions affecting local communities and the district as a whole,

• the process of evaluating project alternatives,

• the capital and operating budgets and finance plans,

• management of the regional fund,

• equity in subarea budgets and reporting,

• adherence to schedules and budgets, and

• review of annual performance audits.

The Citizen Oversight Panel feels its responsibility extends to highlighting good news and accomplishments as well as criticisms and areas for improvement at any given time. The Panel's work on behalf of the citizenry of the urbanized Central Puget Sound region is intended to help ensure the success of the plans and investments in improving regional transit through vigilance, continuous feedback and constructive suggestions.

The Process Used to Prepare the Performance Evaluation

The Citizen Oversight Panel is an unpaid body of citizen volunteers who meet once or twice a month to conduct their business, receive briefings on Sound Transit's efforts, and to prepare semi-annual reports on Sound Transit's performance. COP members attempt to focus on their mission of reviewing performance and to avoid digressions into the Board's domain of setting policy and representing citizens or the staff's domain of running the agency. The Panel uses the resources and knowledge of the Sound Transit staff while maintaining the independence and objectivity needed to assess the agency's performance. COP operates as a body of knowledgeable citizens, not as ombudsmen, technical specialists or as auditors.

To meet these objectives, the Panel took a number of steps. First, it retained the services of an independent staff person to help conduct outside research, prepare independent briefings and reports, act as liaison with Sound Transit staff and facilitate meetings as needed. Next, the Panel agreed that it would use three different sources of information in conducting its reviews:

1. The Panel uses Sound Transit staff and resources to remain briefed on day-to-day operational progress of the agency. Sound Transit staff make regular presentations to the Panel at its meetings and Panel members are mailed all materials prepared for the Sound Transit Board, including resolutions, policy guides, budgets and financial reports, action plans and other work products and documents.
   
2. Second, the Panel members conduct independent research of their own by attending Board meetings, community meetings, civic and professional meetings, and by maintaining a set of contacts to stay actively attuned to citizen views in their subareas and throughout the district. As part of the current review, Panel members conducted telephone and in-person interviews with selected local groups and governments identified below.
   
3. Third, the Panel uses the resources of other independent experts and specialists to study specific issues that may arise. During this evaluation period, COP did not employ any outside experts.

COP uses three key benchmark questions based on the commitments made in Sound Move. They are: is Sound Transit on mission? on budget? and on schedule? for each of the three modes, light rail, commuter rail and regional express. Additionally, COP reviews citizen involvement and adherence to financial policies.

The complete evaluation process this period involved staff briefings, review of agency materials by Panel members, personal contacts by members with a variety of constituencies, and a group evaluation in which COP members evaluated Sound Transit on key issues. The last step involved group discussion and identification of accomplishments, issues, concerns and areas for improvement.

As part of this evaluation, COP members conducted in-person meetings or telephone interviews with representatives of WSDOT, the King County Executive staff, King County Council staff, the City of Auburn, the City of Kent, the City of Puyallup, the City of Seattle, Rainier Valley Technical Advisory Committee, Save Our Valley, Capitol Hill and First Hill communities, Washington Association of Rail Passengers, and the Burlington Northern Santa Fe Railroad. These groups were selected based on the level of Sound Transit activity in their area and their interest in sharing their views with the Panel.

The body of this report discusses the observations, findings and conclusions in each of the topic areas evaluated for this period.

Highlights of Sound Transit Performance

The Citizen Oversight Panel found that, at mid-year 2000, Sound Transit continues the significant strides toward meeting the commitments made to voters in Sound Move. Three and a half years have passed since the November 1996 vote that created Sound Transit and gave it a mandate to develop an integrated public transit system in the central Puget Sound region. The program is in the midst of its most difficult phase. Much money has been spent but few products are publicly visible yet.

There are widely divergent perceptions of Sound Transit in the public, ranging from a view that "there are no problems" all the way to "it's a disaster." Some voices are saying the program is largely on schedule and on budget; others feel that it is a "boondoggle" and the agency is "hiding the truth" about problems. The Citizen Oversight Panel has a responsibility to ask the tough questions and report its findings to the Board and the public.

The Changing Environment of Sound Transit

When the region's elected officials sat down together in 1996 to put together the package that became Sound Move, they fully intended to provide ironclad accountability mechanisms to ensure that commitments to schedule and budget and financial policies would be met. Today those commitments and those mechanisms are still in place, but many things have changed around them.

Some of the elected officials who made those commitments have left office. Some recently elected officials, without the historical background of those agreements, have joined the Sound Transit Board. Transportation gridlock has become noticeably worse in the central Puget Sound region. Communities have seen steady, continuing, year-by-year population and Employment growth. Urbanization has taken hold in even relatively rural communities and the specter of ever more growth has made town centers and transit-oriented development ever more acceptable. While prosperity has helped local communities' revenue coffers, their infrastructure needs have outpaced even the new revenues.

Simultaneously, anti-tax initiatives have been affecting or may, if passed, affect government and transportation funding. In this environment of changing conditions, Sound Transit has attempted to stay true to its mission and its original Sound Move commitments and yet stay responsive to its constituents, stakeholders and partners. That has been a balancing act requiring sensitivity and judgment.

Today, it has become apparent that while Sound Transit's Board and staff have tried hard to please individual communities and interests, a combination of scope changes and improvements at various levels, review stages and jurisdictions can no longer be sustained. The tendency to make small and large enhancements along the way is not unique to Sound Transit, but is common to large public works projects. Additionally, the effects of Initiative 695 on all parts of the program have virtually destroyed one of the basic premises of Sound Move--financial partnership with other agencies. With unlimited funds, most everyone could be made happy with the project. But funds are not unlimited and it is COP's job to clearly highlight the many pressures to spend more. We hope that by making the cumulative effect of these pressures visible to the public and to Sound Transit's partners, a future financial deficit can be avoided.

In this reporting period, COP members identified as the main messages a cautious optimism and an increasing concern. Our best judgment to date is that there is cause for optimism that the project is largely on schedule and cause for concern that the budget could get out of hand if fiscal discipline is not ensured.

Progress

Many elements of the program are going well and the agency deserves credit for its accomplishments in this six-month period.

Link on schedule
Link Light Rail is still on schedule and will in a few months award its first major construction contracts in Seattle and Tacoma. Despite obstacles, lawsuits and ongoing struggles on every front, the project planning, engineering and design are on track and the region's leaders and citizens have stood together resolutely to move the project forward. The full funding grant agreement has been submitted to the Federal Transit Administration on schedule and the federal funding commitment is expected this fall. Agreements with major partners including the University of Washington, the City of Seattle and Metropolitan King County have been reached.  

Regional Express service improvements
Additional new bus service started operating this spring and more new service is planned for the fall of this year. As local transit agencies have struggled with the impacts of Initiative 695, Sound Transit has been able to fill in service gaps in the region.

Sounder to begin service
Despite schedule delays and cost increases, commuter rail is scheduled to begin limited service on September 18. Although the stations and parking facilities will not yet be fully built, riders will have an early opportunity to experience a reliable alternative to car and bus commuting between Tacoma and Seattle.

Concerns

While the accomplishments are numerous, there are growing concerns about the costs of the program and the region's ability to make the right investment decisions in light of the popular will and technological difficulties.

Funding and the true costs of Sound Move
Increasing public attention has been drawn to the escalating costs of all elements of the Sound Move plan. While the greatest degree of skepticism has been directed at the funding of the Link light rail portion of the plan, in fact all three lines of business as well as overhead functions are experiencing dramatic cost increases. As COP noted in its previous report, all together, the various elements of Sound Transit's program were over their original 1995 estimated budgets by $476 million, or 12%, at year-end 1999. Of this total, $223 million was for direct program costs for Sounder, Link and Regional Express, while $253 million was for higher overhead and financing costs. At mid-year 2000 a number of additional cost increases have surfaced.

As the Panel has noted in past reports, these increases are attributable to many factors:

• Community expectations of a highest quality product at minimal impact or inconvenience;

• Jurisdictional and agency requirements that Sound Transit compensate them for the full value of impacts;

• Board actions to enhance the original plan in response to community and partner requests;

• Underestimation of the capital costs of many of the projects included in the Sound Move plan;

• Underestimation of the overhead costs to manage such a large capital program; and

• High cost labor and real estate markets that have put pressure on right-of-way acquisition costs and salaries and wages.

Some of the cost increases can only be called "cost overruns" or higher costs for the original product as a result of errors in estimation or a failure to anticipate and plan adequately for changes in conditions. Other increases are the result of scope changes and "scope creep," the cumulative effect of many small improvements to the original plan. It is now becoming clear that Sound Transit is experiencing both cost overruns and scope creep.

Another cost factor has arisen due to the loss of funds by WSDOT and local partners as a result of I-695. Sound Transit has been required to pick up gaps in funding that were originally the responsibility of other agencies. An example are the King County Metro express routes that Sound Transit assumed and that were intended to free up service hours for new local service. Metro has been unable to extend its service due to lack of funds.

Finally, although local jurisdictions and agencies have viewed the large Sound Transit program as an asset for their communities, they have also viewed it as a means to seek compensation for impacts. Some have also sought to derive additional benefits through enhancement of the original project.

Based on its current financial policies, Sound Transit is approaching the limits of its financing capability. Even with local tax revenues flowing stronger than expected, bond financing at historically low interest rates and increased assumptions on federal funding, Sound Transit can no longer add any more cost to its current financial assumptions. There simply is no more money. Unless the Board approves reductions in scope or changes in its financial policies, Sound Transit will be overextended.

The Citizen Oversight Panel calls upon the Board of Sound Transit and the partners and communities within the region to insist on budgetary discipline and to refrain from further add-ons, improvements or enhancements that are not affordable and consistent with the original plan. We urge the Board to ensure that the rising costs are contained in the upcoming 2001 budget process.

Scope creep and the impacts on Phase 2
Enhancements and scope changes to the original plan have been accompanied in each case by technical review and expert recommendations and by the deliberations of the Board. Each individual change to the scope has been made after due consideration and for excellent reasons. Nevertheless, Panel members are concerned that the cumulative effects of scope creep will undermine the long-term viability of the regional transit program.

Examples of scope creep, well-intentioned and desirable as each may be, include the following:

• The addition of the Beacon Hill tunnel to the Link alignment in southeast Seattle;

• Parking garages in Kent and Auburn where Sound Move anticipated only surface parking;

• Additional bus service hours in East King County as a result of greater frequency and early implementation of service;

• Expanded transit center and direct access projects in Federal Way, Bellevue and Lynnwood;

• The Community Development Fund for southeast Seattle.

As the scope of Phase 1 projects has increased, funding capacity for Phase 2 has become tighter. In the uncertain environment of anti-transit citizen initiatives, COP members are concerned that the rising costs of implementing Phase 1 of Sound Move will erode citizen faith that a major capital program can be built as promised. As Sound Transit begins planning for future system expansion, the increasing costs already experienced in Phase 1 could undermine development and passage of even a modest Phase 2 plan.

I-90 two-way transit
A key element of reliable regional transit is two-way access for buses and HOV across Lake Washington. Large daily movements of riders between jobs, housing, shopping and business centers on both sides of the lake require dedicated lanes for transit. For 30 years, such lanes have been part of the long-term plan for the Interstate 90 bridge. After significant expenditures of Sound Transit funds for planning and pre-engineering, the Washington State Department of Transportation (WSDOT) appears to have arrived at a situation in which no alternative is considered technologically feasible. COP members find that to be an unacceptable outcome. We urge all parties to exert their creativity and problem-solving skills to break through the apparent impasse and work to implement dedicated two-way transit and HOV as soon as possible.

Northgate alignment
Although the $350 to $500 million in funds required to reach from NE 45th Street to Northgate are not yet identified, studies are underway to determine the preferred alignment. The most promising alternatives are an elevated alignment along NE 8th Avenue and a tunnel alternative under NE 12th Avenue, at a cost differential of some $85 million. Citizens of the University District and Roosevelt neighborhoods have clearly expressed their preference for a tunnel.

COP found a number of reasons to be concerned about how the Board might handle the selection of this alternative. The use of impartial criteria of cost and technical suitability led in southeast Seattle to a surface alignment. The decision making in the north will be watched with great attention for evidence of the same credibility and impartiality. Another factor to be considered is that the additional cost of the tunnel alignment could jeopardize the future extension of light rail to other communities in the north. The cohesion of the region as a whole could be severely undermined and the entire project's future endangered if the Board action on the Northgate alignment is viewed as indifferent to issues of equity and technical objectivity.

While the Panel generally avoids commenting on upcoming Board decisions, members felt that the issue of the Board's selection of a preferred alignment to Northgate warrants the raising of a cautionary flag. We wished to signal our concern that this decision could be fraught with implications beyond the immediately affected neighborhoods.

Sounder implementation
A number of issues involving Sounder are unresolved and pose significant risks for the feasibility of current plans and for cost escalation. On the south segment, the BNSF agreement for capital improvements to track and signal systems has not been signed and costs are still being negotiated. There is also no agreement yet with the City of Tacoma on the use of Tacoma Rail and the station at Freighthouse Square. On the north segment, an $83 million funding gap is cause for questions about the feasibility of the current plan.

Additional Accomplishments

COP found that, in the first half of the year 2000, the regional funding and service delivery that is Sound Transit was largely successful in meeting citizen expectations. While Sound Transit budget increases are causing concern and schedule delays are evident in some areas, there have also been numerous achievements occurring below the radar screen of media and public attention.

Agency-Wide Achievements

Board leadership and oversight
The Sound Transit Board of Directors has under its new chairman and with the active participation of its new members stepped up its oversight and involvement in a number of areas. A new Board task force dedicated to oversight of Central Link has been meeting regularly and monitoring the increasingly large volume of activity in the light rail project. Board members have stepped in and become involved in key negotiations with the University of Washington, King County, the City of Seattle and the City of Tukwila, and helped broker important agreements as key decisions had to be reached. Board members have actively participated in lobbying in Olympia and in Washington D.C. on behalf of Sound Transit interests. On the administrative side, a new searchable tracking system for all Board motions and resolutions became available on Sound Transit's website, improving public access to information about Board actions.

Finance and Administration
Despite delays in its initial implementation, the Finance Department has been developing and installing a new integrated financial and project control system for over two years. COP was pleased to note that the system is on budget and on schedule, welcome news in light of other government agencies' difficulties implementing new MIS systems. Sound Transit's system, called One World, is producing monthly financial statements and reports and is tracking project budgets, contractor payments and change orders. Extensive training has been underway since the beginning of the year to ensure that all department staff are using the new system correctly and all data entered into the system are accurate.

For the third year in a row, Sound Transit received clean financial audits with no reportable findings. The agency's independent auditors found that Sound Transit complied with its financial policies on sub-area equity and management of the Regional Fund. A redesigned monthly agency progress report was introduced in May, with the encouragement of COP. It is more readable and user-friendly than its predecessor and provides capsule summaries of ongoing activities and milestones.

Public and government affairs
Sound Transit was partially successful in achieving its legislative goals in Olympia during the 2000 session. The agency received authorization to develop an owner-controlled insurance program and to enter into lease/leaseback arrangements. Sound Transit also received a "down payment" of $15 million in state funds toward completion of its program. This was a real achievement, but not the estimated $200 million tax credit the agency had sought.

Link Light Rail

Agreements reached
In its year-end report 1999, COP expressed concern that three major agreements were yet to be reached so that a full funding grant agreement with the Federal Transit Administration could be submitted by mid-year 2000. They were:

1. with King County and the City of Seattle on the downtown tunnel and related bus facility improvements;

2. with the University of Washington on property needs and fair and appropriate mitigation; and

3. with the City of Tukwila on an alignment acceptable to both regional and local interests.

The first two of these agreements were concluded through the involvement of Sound Transit and regional leadership. The third agreement, with the City of Tukwila, is still pending the full analysis of a new freeway alignment preferred by the city. The negotiations with the University and with King County were long and hard and ended up costing Sound Transit more money than it had budgeted. Nevertheless, their conclusion was a significant milestone that had to be met to keep the project on schedule.

Full funding grant agreement on track
The application for a $500 million full funding grant agreement (FFGA) with the federal government for the segment from Lander Street to NE 45th was submitted on time and is now being reviewed by the Federal Transit Administration in Washington D.C. A positive response is expected shortly.

Design/build contract
The request for proposal (RFP) for the design/build contract for the Capitol Hill/University District tunnel was in the hands of the proposers for much of the first half of 2000. Technical and financial proposals were received from two firms and were under review at mid-year. The selection of the contractor was scheduled for August with negotiations over scope and budget to proceed through August and September.

Northgate
Sound Transit issued an addendum to the Central Link Final EIS for the segment between NE 45^th and Northgate. It summarized the preliminary engineering, impacts and mitigation measures for four alternative alignments. Outreach to citizens, businesses and property owners has been extensive and the community has expressed its clear preference for the underground alignment under 12th Avenue NE. Efforts are proceeding to identify funding for the segment.

Community Development Fund
Despite initial delays, the process to develop the $50 million community development fund promised to citizens and stakeholders of southeast Seattle is beginning to take shape. The C-Link Task Force agreed to form a steering committee charged with developing an operational plan for the fund. The steering committee will include representatives of the Southeast Seattle community, Sound Transit, the City of Seattle and King County.

Permitting of Central Link
The legal framework for obtaining permits within the City of Seattle was established through several new ordinances adopted by the City Council. A major milestone was also reached when Sound Transit received concurrence letters from the U.S. Fish and Wildlife Service and the National Marine Fisheries Service signaling completion of the Endangered Species Act (ESA) compliance process.

Tacoma Link
Final design for the systems elements of Tacoma Link was completed, procurement of the Tacoma light rail vehicles was completed, bid documents have been prepared, and right of way acquisition is underway. The project is scheduled to begin construction this fall.

Sounder Commuter Rail

Agreements with BNSF
Agreements for operation of commuter rail and capital improvements to track and signals were reached for the Tacoma-to-Seattle segment after protracted negotiations. A portion of the agreement is still being negotiated, although BNSF has given verbal permission for construction in the rail right-of-way in Kent, Auburn and Sumner. The loss of the previously committed $60 million contribution by WSDOT as a result of I-695 was able to be offset by a decision of the Puget Sound Regional Council to reprogram federal funds from other projects that were not able to use the funds right away. Those projects will receive their federal dollars at a later date.

Stations under construction
Construction is underway at Auburn, Kent, Puyallup and Sumner stations in preparation for the September 18 start of commuter rail service between Tacoma and Seattle. A temporary platform is being built at the Tacoma Dome Station.

Other Sounder accomplishments
On the Everett-to-Seattle segment, a Record of Decision (ROD) was obtained from the Federal Transit Administration. On the Lakewood-to-Tacoma segment, the draft EIS was released for review and preliminary engineering on track and signal improvements begun. Train speed limits were lifted in Kent, Auburn and Sumner. Train speed issues in Seattle and Puyallup are expected to be resolved in September. Design/build contracts have been advertised for development of parking structures at Kent and Auburn stations.

Regional Express

ST Express Bus service
The new routes were steadily building ridership and in March Regional Express experienced its 2 millionth rider. Overall, the farebox recovery ratio has been 22% with a target of 28% by year-end. New service was implemented in May on the Everett-Northgate route.

Service Implementation Plan
The 2000 SIP was adopted by the Board with a plan for three new routes scheduled to come on line in September: Redmond-Seattle, Redmond-University District and Bellevue-SeaTac. An operating deficit in East King County was to be funded by surplus revenues generated in the subarea.

Progress on capital projects.
he environmental assessment on the Lynnwood Transit Center has been completed. A Finding of No Significant Impact is expected shortly. Construction has begun on the Overlake Transit Center and Park and Ride in Redmond. Bids have been received for the South Hill project (Puyallup) and were under budget. Construction has begun on the first phase of the Sunset Interchange. The Bellevue Direct Access project has completed design and the budget has increased from $110 million to $164 million based on the revised scope.

Significant Concerns

COP members also made observations about areas in which they see cause for real concern.

Rising costs
As noted elsewhere in this report, various elements of Sound Transit's program are over their original 1995 estimated budgets. COP has reviewed and discussed the nature of the cost increases and identified those attributable to change orders authorized by the agency and the Board and those that are actual cost overruns due to poor estimates and assumptions. Regardless of reasons, it is clear that costs are continuing to rise. An updated 2001 Finance Plan will not be available until October, but at this time a number of additional cost increases have become known and have been authorized by Board action:

• Bellevue Direct Access $27 million

• BNSF agreement for track and signals $25 million

• UW agreement $7-11 million

• King County tunnel transfer agreement $5.6 million (may be reimbursed after 2006)

• Sounder station delays $0.6 million

Other potential anticipated cost increases include:

• Capitol Hill/University District tunnel amount unknown

• First Hill/Capitol Hill mitigation amount unknown

• Temporary platform at Tacoma Dome amount unknown

• Tukwila freeway route $45 million

• Sounder north segment $83 million, ($37 million cost overrun and $46 million due to WSDOT I-695 shortfall)

Link construction mitigation
Communities and neighborhoods have a right to expect that construction impacts will be minimized. Especially in densely populated, already built-up neighborhoods like First Hill and Capitol Hill where thousands of residents live within a few hundred feet of construction sites, Sound Transit may have underestimated the appropriate level of mitigation required. Although the agency has gone further than has been the practice in the past on major construction projects in proposing ways to minimize traffic, noise, dust and other impacts, expectations have been higher still.

Because Link has taken most seriously its commitment to begin light rail service in 2006, it has had to propose a construction schedule that includes tunneling work 24 hours a day for five years. The potential nighttime impacts on residents of densely populated neighborhoods are significant and the agency may have underestimated the level of concern by those who fear five years of sleepless nights. Similarly the potential impacts on small businesses in the Broadway area are significant and if even a handful are forced to close their doors, the character of a unique and flourishing business district could be damaged.

Can such impacts be mitigated out of existence? Probably not. However, the level of effort and the degree of sensitivity to the concerns of the affected residents and businesses have not been sufficient. Community representatives on First Hill and Capitol Hill felt that Sound Transit staff were unresponsive to their expressed concerns and offered little in the way of fresh ideas or problem-solving. The City of Seattle appropriately delayed granting a proposed noise variance until further work can be done to refine the proposed mitigation.

Sounder implementation
In addition to the nine-month delay of service start-up from the originally promised December 1999 to now September 2000, it is apparent that four of the commuter rail stations will not be complete in time for the revised start date. Auburn and Sumner will be the only intermediate stops when service begins on September 18. Delayed negotiations with BNSF, miscalculations in authorizing out-of-sequence construction tasks, a poorly executed permitting approach and less-than-excellent relationships between Sounder staff and key stakeholders have all contributed to the delays. Additionally, negotiations with the City of Tacoma over the use of its track and over siting of the station at Freighthouse Square have caused delays and added costs.

Some observers have expressed concern that Sound Transit is not well prepared to offer the reliable, high quality service that the public expects and that potential riders could be driven off by the experience of start-up snafus. Concerns have also been expressed about passenger safety at stations that are under construction and on crossings with temporary fencing. COP members urge Sound Transit to proceed with caution in beginning service and to ensure that public expectations do not collide with the reality of start-up commuter service that must be phased in over time.

Agency management
Sound Transit is no longer the start-up organization full of the excitement of its first year. It is a maturing agency in the midst of a hugely complex and politically difficult undertaking. COP credits management with recognizing its weaknesses and moving to address them in most cases. Despite obstacles and opposition, the agency's leadership has shown resilience in staying on mission and moving the project forward. Nevertheless, there are signs of strain and of issues that need to be addressed.

In the first half of 2000, employee turnover at Sound Transit was an annualized 19%. The stress of performing under constant schedule pressure with a lean staff and with very tight budgets has begun to take its toll on the people of Sound Transit. While some turnover is natural and to be expected in the strong economy that the region enjoys, there is also evidence that staff at Sound Transit are showing signs of burn-out and that management may need to institute new retention measures to keep the quality, productivity and motivation high.

Certain key logistical functions such as contracting, scheduling and project controls have undergone repeated reorganizations. As the agency enters the construction phase of the program, these functions must operate with a high degree of effectiveness and it is hoped that recent changes in these areas will finally bring the stability and quality of performance that is required.

Another area of concern has been the agency's slowness in elevating critical issues from the project management level to senior leadership for action in a timely manner. COP members have identified instances in which an apparent failure to anticipate critical milestones have weakened the agency's negotiating positions and caused missed opportunities to advance the agency's program. This issue has been noted by agency leadership and a plan has been instituted to hire a chief operating officer.

Communication with the public
The agency's early commitment to a spirit of openness has diminished and been replaced by a much more cautious approach to guarding information and "managing" messages. In communications with the public, with stakeholders and with the Board, there is often a tone of bland optimism and a lack of complete forthrightness that tend to breed mistrust among the audiences listening to the messages. COP encourages the agency to recommit itself to the spirit of openness and full accountability it began with in 1996.

Community relations
This is another area in which the agency has made repeated attempts to improve its performance without much success. Because of the significant impacts it will have on neighborhoods and individual property owners and businesses, Sound Transit committed to working with communities in a responsive manner. Some concerns can be mitigated with the expenditure of dollars. But in other instances, hearing the concerns and engaging in responsive problem solving are what the public wants and expects. This has not been a consistent strength of the agency.

One observer commented, "they have never understood the difference between communicating and listening." If good community relations is based on both providing information and responding to public feedback, it appears that Sound Transit continues to err in believing that attractively designed communication pieces can substitute for real responsiveness to the concerns of the public. Sound Transit has proven effective at upbeat marketing campaigns, staged events and promotional public relations. It has not done well in anticipating concerns, conducting strategic issue-based outreach and entering into creative dialogue with affected stakeholders. Conflicts have been avoided by inexperienced staff rather than faced and dealt with. Throughout the district, there are citizens, stakeholders and partners who feel they have not been listened to, heard or responded to. It is particularly disheartening to report that some of the staunchest advocates of the Sound Move program are among the most disappointed and frustrated members of the agency's public.

COP has targeted the issue of community relations in previous reports. Having noted this, the Panel encourages the public to distinguish between "not being heard" and not getting what it wants. We expressed in other sections of this report the issue of "scope creep" which results when giving the public what it wants without assurances that the dollars are there to pay for it. There is evidence of instances in which the agency, through its community relations efforts, has communicated public desires to the Board but where the staff and Board have had to "stay the course" in the interest of meeting budget and schedule.

Who is the Citizen Oversight Panel?