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Rewarding Failure 

Streetcars that are too wide, long, and heavy (136 @ $3.5 million per). Bus engines that don't fit and are scrapped (20 @ $116,000 a pop). Manhole covers that take 10 engineers and three months to design (cost: $243,000). Muni's management has produced su

Wednesday, Dec 9 1998
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Page 4 of 5

Consultants have been feeding on San Francisco's transit system for decades. Shortly after the turn of the century, San Francisco Mayor Eugene Schmitz and most of the members of the Board of Supervisors went to prison for accepting bribes from a consultant to a private streetcar company. An early Muni consultant, Bion J. Arnold, built tracks into empty dunes that had been bought up by his land-speculating friends. After World War II, a pair of military-industrial consultants, Col. Marmion "Insider" Mills and Col. Sidney Bingham, engineered Muni's switch from environmentally friendly electric streetcars to smoke-spewing diesel buses sold by General Motors.

But Muni does not need to hire consultants to mess up capital projects. Muni can do that on its own.

Muni's most recent internal financial reports show that of Muni's 82 ongoing capital project line items, 46 are over budget -- to the tune of $91 million. Muni can't perform simple addition and subtraction, say its overseers, who note, among other things, $100 million in accounting errors at the agency. And, outraged auditors sputter, Muni has a disturbing habit of throwing away original budgets and schedules in childish attempts to hide cost and time overruns.

Incompetence or something worse? Cascades of large and small "mistakes," chronicled in government records, keep raising the question:

* Two years ago, Muni's engineering division needed to quickly spend some federal money that was earmarked for rehabilitation. It wasn't enough money to rehab a whole building, but it wasn't an insignificant sum, either. As it turned out, there were a series of manholes along the city's cable car lines that were constructed of a "light-weight metal material that warps." The hatch covers did not need to be redesigned, really; all that was needed was a heavier metal cover. Ten engineers were budgeted to spend up to three months deciding what metal to use for the new covers. The cost: $243,342.

* Last summer, Muni paid a consultant to design a computer center at Muni headquarters on Presidio Avenue. After the design was almost complete, Muni executives decided to move the computer center to a temporary office at 875 Stevenson St. So a new design became necessary -- for an office that Muni hopes to leave by the end of 1999.

* Not long ago, Muni paid $2.3 million for 20 massive diesel bus engines, but did not add them to its property inventory. By the time an auditor stumbled across the $116,000 engines, they had been left to rust, because they were the wrong size for Muni's buses. The auditor suggested the engines be sold for scrap value.

* City Budget Analyst Harvey Rose was appalled in 1996 when he found that Muni was "jeopardizing multimillion dollar investments" by completely replacing its fleet of streetcars, buses, and trolleys before finding anywhere to store the new vehicles. And attempts to provide more storage and maintenance space have gone almost humorously awry. Building expansions and improvements have repeatedly been torn apart because architectural drawings specified sizes that turned out, later, not to fit the equipment to be housed.

* Muni engineers have been less than clever about specifying designs for new electric trolley buses. The first round of buys -- a small fleet of trolleys built by New Flyer Industries Limited of Winnipeg, Canada -- was terminated after Muni discovered "inherent design and performance difficulties with the structure and rear axle assemblies." So Muni went to the Czech Republic and bought buses from the Skoda manufacturing firm. But Muni planners forgot to match the new concrete passenger platforms on Market Street (58 inches tall) to the 55-inch-tall step measurements they gave to Skoda. This seemingly small mistake forced major changes to the trolley frame -- and major expenditures by Muni.

It is not necessary to read through file cabinets full of audits, bid proposals, and consultant invoices to know -- and to know absolutely -- that the Municipal Railway does not work. Muni's inability to keep to schedule has made the agency's name a verb. If one is late in San Francisco, it is often acceptable simply to say, "I was Munied."

The reasons for Muni's continuing ineptitude cannot be called simple, because they have developed over decades, but they are hardly as complicated as Muni's managerial and political leaders claim.

There is a core, day-to-day reason why Muni's buses and rail cars run late 45 percent of the time: The agency's union contracts allow employees to stay away from work in droves. A third of the work force on any given day is absent, and when hundreds of drivers and mechanics don't show up, Muni's trains and buses cannot possibly run on time. Paradoxically, this chronic absenteeism has the effect of generating more than $20 million in yearly overtime payments to drivers and mechanics who fill in for absent co-workers.

As daily operations are currently managed, there is no incentive for Muni to run on time, because Muni workers profit when Muni runs late.

Muni's long-term management problems boil down to a question of accountability. The public record reveals incredibly questionable decisions that have led to amazingly costly errors on a regular basis. Yet, the managers and consultants responsible for those mistakes have not been fired. Rather, their science is arcane enough that their explanations are often simply accepted at face value. Bad decisions and mistakes are continued long after they have become known within the transit agency as boondoggles.

Entire stacks of audits and reports show that Muni's current problems are recycled versions of the same old problems. Mayor Willie Brown and Muni General Manager Emilio Cruz have, by and large, suggested the same old solutions to those problems: more money and more employees.

About The Author

Peter Byrne

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