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Op-Ed: SMART Boss' Contract Sends Irresponsible Signal

Economist Mike Arnold of Novato comes down hard on the $488,000 package for GM Farhad Mansourian.

The $488,000 compensation package for SMART General Manager Farhad Mansourian, recently approved behind closed doors by the SMART board of directors, raises fundamental questions about the board’s ability to perform a critical function: safeguarding taxpayer interests.

No one thinks the compensation is fair or that the agency couldn’t have found an outstanding candidate with experience in passenger rail transportation for a more reasonable compensation package.
 
So, how did the board approve compensation so outrageous it was recently criticized by staunch SMART proponent Dick Spotswood?

The answer is clear: The SMART board didn’t do the homework voters expect and deserve. It didn’t consider how future taxpayer dollars would be committed by the legal double-dipping into two different public pension programs.

The boards of all public agencies have fiduciary responsibilities to the taxpayers who fund the activities of the agency.  Before signing any contract — and certainly a contract that could potentially cost taxpayers millions of dollars in additional pension benefits — it is the board’s responsibility to carefully consider the financial consequences of its actions and conduct due diligence, such as consulting with available public compensation experts.

Had the SMART board members done so, they would have discovered that the pension benefits accruing to Mansourian were precisely the kind of payouts that virtually all voters find outlandish and unfair.  
 
Clearly, the board didn’t consider how much Mansourian’s pension benefits and the cost to taxpayers would increase when he switched from one pension system (Marin County) to another (Calpers). The two Marin supervisors sitting on the SMART board should have known that such a contract would result in a huge hit to future taxpayers’ funds. As if the pension double-dipping wasn’t enough, the board members sweetened the deal further when they signed off on a guaranteed 18-month severance to an individual nearing retirement age.

What has been the response of board members to the onslaught of criticism it has received after the public was informed of the full size of the compensation?

SMART’s chair and vice chair have claimed the compensation package “is a very small economic consideration” and “a financial package … comparable to executives with his qualifications and level of experience nationwide.”  

I say “prove it.” Disclose to the public the compensation studies done prior to finalizing Mansourian’s contract. Provide the public with the documents detailing SMART’s evaluation of compensation packages for executives of comparable passenger rail agencies. Demonstrate that the board completely understood the full cost of Mansourian's compensation to future taxpayers and, despite this knowledge, still granted him a huge increase over the compensation he received as Marin's public works director.

The conclusion that Marin and Sonoma voters ought to draw from this episode is that we continue to be poorly represented by the politicians serving on the SMART board. The board is so dysfunctional that it is incapable of making decisions that require careful reasoning and execution of prudent judgments.   
  
What can voters do?  

The only choice left is to use the power of the ballot box to shut off the revenue stream that funds this board’s incompetence. Voters need to step up to exert control over a board that defends its decision to hire a general manager with no experience in rail transit and compensate him $488,000 a year to oversee a rail agency with only 15 employees, an agency that plans to deliver only half the rail service promised voters in 2008 without further voter input, an agency that  breaks promise after promise to the voters, including siphoning off $8 million from valued Marin County transportation programs.  

Petitions to repeal SMART’s funding are now in circulation. Be sure to sign them. It’s your last chance to remind the SMART board members that they work for the voters, not the other way around.

Bob Ratto October 09, 2011 at 11:38 PM
Golden Gate Transit has had ridership declines for years, but still serves (FY10) 21,000+ riders per day, and there are 3.666 average daily commuters over the bridge. There is definitely additional capacity for buses, but right now there are not enough riders. For $400MM+ you are still looking at shortfalls at the farebox (as happens with all transit), but a fraction of that money could easily go into improved (think reduced fare) bus transit, and there would be no need for further raids of other funds. What is trying to happen here is we are trying to build a transit system to increase density. Most of the time the density exists, and then transit morphs to fit it. We are working with an existing transit system that is operating below capacity, but we should go build another one that I would call redundant, but that would be charitable.
Edwin Drake October 10, 2011 at 05:55 AM
SMARTRE: Sonoma-Marin-Area-Rail-Transit-Ridership-Existentialism -- Where each and every morning the commuter rises and asks "How am I getting to work today?" then makes a conscious decision to ignore the investment in the $60,000 car in the driveway and instead drive that car to a station to wait for a train to take her/him to a place near a ferry terminal to then wait for the Ferry that takes them to another landing across the bay to then take another mode to get to their office, even when it's raining cats and dogs. Yes, this is the SMARTRE train.
John Ferguson October 10, 2011 at 11:23 PM
Hahaha! Thanks for the chuckle, Edwin. If you have to justify your purchase of a $60K vehicle, this is as good a reason as any I suppose.. I choose not to drive a vehicle into the city where I work for several reasons, none of which take into account the sunk cost of a vehicle purchase: 1. I don't like driving. There, I said it. Especially in the dense traffic that exists when I try to drive from where I live to where I work. It's stressful. It's entirely unproductive, as I can't focus on anything else while I do it. Which leads to: 2. While someone else is carrying me to my workplace, I can actually get things done. I write emails, I update project plans, I read the paper or stare off at our amazing scenery. Rich people have chauffeurs - I have public transit. Why would you drive yourself anywhere if you had another reasonable choice? I don't pretend to think that SMART is the best, most wonderful project ever to come down the pipe. It is entirely clear to me, however, that *anything* that gets people out of their 'one person-one car' habits will be an improvement over what we have now. More buses (more dedicated bus lanes!), more trains, more bike lanes, more ferry service please. For everyone.. What Farhad Mansourian is paid might be objectionable to many, but it's really inconsequential when compared to the greater good that any alternative to the unsolvable mess that is Hwy 101 represents. Don't forget - Farhad has to pay for his Lexus too..:)
Edwin Drake October 10, 2011 at 11:41 PM
Again and Again I ask: what's the purpose of SMART? Congestion? Greenhouse gas reduction? Economic Development? Residential density? There are better ways to achieve any of these goals. So, what's the point of SMART? Exactly what is it supposed to achieve? This is a BASIC question that should be asked of any project.
Goofpod October 11, 2011 at 07:56 AM
25 years ago when my son was born I drove down 101 to my job in Marin. Five days per week I would sit in traffic staring at the empty railroad tracks dreaming of what might be some day. Ten years later I was doing the same. Ten years after that the same. Now, my son is driving south for work, staring at the empty railroad tracks while sitting in traffic gridlock dreaming of what might be better. TWENTY-FIVE YEARS, TWO GENERATIONS, COUNTLESS WARS. INSURMOUNTABLE DEBT, JERRY BROWN and myriad gutless politicians. And what has changed? More traffic and no better dream. More BUSES surrounded by gridlock. Build the freaking train, please.

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