When Governments Become Dysfunctional

With the federal government poised to lavish $2 trillion or more on State and local governments, now might be a good time to take stock of how well equipped the receiving agencies are to use hundreds of billions of incoming new dollars in prudent and productive ways.

Given the Bay Area’s dismal recent record of managing large amounts of capital, the prognosis is not good. Before identifying causes it is necessary to provide a small sampling of the results. 

Abandonment of the HSR Altamont Alignment. Catering to San Jose’s parochial demand that every high-speed train pass through its city, MTC shifted the previously planned Altamont high-speed rail route into the Bay Area to a remote area 50 miles to the South. The original alignment would have afforded the Altamont Commute Express (ACE) the opportunity of sharing tracks with HSR, thereby cutting the ACE rail trip time between Stockton and Silicon Valley in half for an estimated cost of $2 billion. Without this opportunity it is now estimated that it would cost many times $2 billion to create an efficient commuter rail connection between the San Joaquin Valley via the Tri-Valley to the South Bay. This travesty is a classic example of the damage done when legitimate regional transportation needs are subordinated to the parochial desires of a single city. 

San Francisco’s Central Subway. In 2003 the original cost of the 1.3 mile Central Subway Project, slated for completion in 2018, was put at $647 million. The project was subsequently sold to local and federal political funding authorities using artificially low cost estimates, bloated ridership projections and rosy completion dates. Later, after the project had been approved, the early misstatements were quietly corrected. Current estimates are that the project, now at least four years behind schedule, will cost over $2 billion. 

Bay Bridge East Span: Following the 6.9 magnitude Loma Prieta Earthquake of 1989 it became necessary to seismically upgrade the Bridge’s East Span. For under $2 billion and without disrupting traffic, the rather handsome existing cantilever section could have been seismically upgraded and outfitted with new foundations. However, under MTC auspices it was decided replace the old structure with an entirely new one. The replacement, featuring its no-longer-much-noticed “iconic tower”, took an absurdly long 22 years to build and ended up costing almost $7 billion. 

SCVTA’s 6-mile Phase II BART Extension. In mid-2018 the estimated cost of this Santa Clara Valley Transportation Authority (VTA) project stood at $4.7 billion. In September of 2020, the San Jose Mercury put it at $6.5 billion. It is now reportedly $6.8 billion and rising. The much delayed opening of service is currently scheduled for “2029 or 2030”. This is what invariably happens when individuals and agencies who are either inexperienced or unduly acquiescent to special interests, or both, are given authority over major infrastructure projects. 

Causes

There are many reasons why large agencies and political jurisdictions so often miss the mark. Here are five:

  1. Leadership Unprepared:  People appointed or elected to powerful positions on major commissions or Boards often don’t have a clue as to what it expected of them. It is of critical importance that experienced and otherwise highly qualified individuals sit on policy and decision-making boards and commissions.
     
  2. Gaps in Management:  No one person can effectively run a large organization. To make things work at all levels and in all departments, there has to be a whole team of committed and experienced individuals, all held accountable for their actions. When an upper or middle manager falls down on the job, little can be expected from his or her confused and dispirited subordinates.
  3. Staying on Target:  Capital improvement priorities must to be logical, far-sighted and in line with the published objectives of the organization (usually prominently displayed on Agency websites). This requires both a competent and dedicated professional staff and an effective policy-making body.
  4. Destructive Acquiescence:  The squeakiest wheel should not automatically get the oil. All decisions must be objective, logical and practical.
  5. Failure to Face Reality:  When confronted with a major problem, policy-makers often jump at flashy, short-term diversions that fail to address the real problem. 

Every now and then it is necessary to take stock and adopt productive changes. Now would appear to be one of those times. 

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