Reform California Releases Top 10 Worst Examples of Waste, Fraud and Abuse of Gas Tax Funds in Caltrans and Local Transportation Agencies

Reform California Releases Top 10 Worst Examples of Waste, Fraud and Abuse of Gas Tax Funds in Caltrans and Local Transportation Agencies

Road Signs Promoting SB1 Gas Tax Hike Cost $6,528 Each! A $227k bus driver and hundreds of other bus drivers earning $100,000 or more! 30% of road maintenance funds diverted to homeless cleanups! $50,000 for one conference table…

With the election just weeks away, Reform California today released government documents and records showing numerous examples of “epic levels” of waste, fraud and abuse of gas tax funds and other taxpayer resources at Caltrans and local transportation agencies throughout California.

The records and documents were obtained through the California Public Records Act (CPRA) process – and cover only materials received back from the CA Dept. of Transportation (Caltrans), local transportation agencies in San Diego, Los Angeles, Orange County, the Bay Area, and Sacramento. Other local government agencies also receive and spend gas tax funds – raising the question of how many more examples of waste of gas tax funds exist.

“These examples of outrageous waste of the gas tax and other taxpayer resources provide the best reason to vote YES on Prop 6 the Gas Tax Repeal Initiative,” said Carl DeMaio, chairman of the campaign.

“Our existing gas tax funds are being wasted and we demand that these revelations of outrageous expenditures be immediately reformed before we give these people any more of our taxpayer dollars,” noted DeMaio.

#1: Outrageous Roadside Sign Expenses

Everyone is seeing a variety of Caltrans and local transportation signs pop up along the freeways declaring “Your Tax Dollars at Work.”  The signs are stirring controversy as a thinly veiled attempt to campaign against Prop 6 using taxpayer funds.

Just how much do these signs cost taxpayers?  OCTA issued a “Change Order” for the I-405 freeway project signs that led to a cost increase of $32,644.25 – or a total cost of 6,528.85 for EACH sign!  The contract plainly states that it only includes the design, production, and installation of five roadside signs that said “OC-GO ‘Your Tax Dollars at Work’” and also included the SB 1 logo.

#2: Gold-Plated Transit Buses Costing 3-5 Times National Average – That Break Down!

Several local transit agencies receiving gas tax funds have been caught with champagne and caviar bus appetites – paying three, four, and five times the cost of the average new bus price.

Instead of purchasing and running natural-gas powered clean buses at a cost of roughly $300,000 each, San Diego MTS has decided that political correctness demands they pay hundreds of thousands MORE or 3 times more per bus for all-electric buses – or $900,000 each!

Los Angeles Metro is paying more than five times the expected cost per bus!  Instead of purchasing and running natural-gas powered clean buses at a cost of roughly $300,000 each, LA Metro has decided that political correctness demands they pay $1.65 million per bus for all-electric buses!

LAMTA purchased these all-electric buses despite numerous documented performance problems found by LAMTA staff when they conducted a pilot project with 5 of these all-electric buses. A LAMTA board report stated, “The operating performance of these initial prototype buses did not meet Metro’s daily operational requirements – and after a full year of operation were removed from active service.”  The same LAMTA board report stated the buses had “limited range between charges and poor hill-climbing ability severely limits the lines on which they can be operated…the buses have also experienced low reliability.” Despite all of these red flags, LAMTA used a “non-competitive” contract process to purchase more of these costly, performance-plagued buses.  But hey, at least it is politically correct to be all-electric and the gas tax hike can cover the excessive cost!

#3: 30 percent of Caltrans “Maintenance” Budget in San Diego Goes to Homeless Clean Ups, Not Road Maintenance

On September 19, 2018, a San Diego region Caltrans official confirmed that a large chunk of Caltrans’ Road Maintenance budget in San Diego County is being diverted for cleaning up homeless camps.

The numbers are alarming: 30 percent of Caltrans’ $18.1 million local maintenance budget went for picking up after people last year. $6.2 million went toward picking up litter off the freeway and for cleaning out the debris fields left behind by homeless encampments abandoned in the wake of 72-hour notices that trash crews are coming.

“That’s the stuff they didn’t want,” said Caltrans spokesman Ed Joyce. “Last year, taxpayers spent millions for crews to work nearly 56,500 hours cleaning up after other people.”  — San Diego Reader, September 19, 2018.

Link to SD Reader article: https://www.sandiegoreader.com/news/2018/sep/19/city-lights-i-5-has-worst-805-second/

#4: The $100,000 Club – Government Employees Earning 6-Figure Salaries from Gas Tax

In just the agencies selected for this review, an astonishing percentage of individuals are earning over $100,000 a year in compensation – at a time when the median income in California stands at just $$32,482 per capita.  While it certainly is expected that some executive-level employees would earn six-figures, the astonishingly high percentage of total employees in the $100,000 Club is excessive.

  • Caltrans: More than half (57%) of the Caltrans employees earns $100,000 or more per year – with 11,256 Caltrans employees pulling in $100,000 or more. For every “active” project at Caltrans, there are more than six members of the $100,000 Club! The average compensation at Caltrans is a whopping $113,554 a year.
  • Sacramento Regional Transit District: Sacramento RT has 39% of its employees earning $100,000 – for a total of 396 employees.
  • San Francisco Department of Public Works: The SFPW has nearly two-thirds (63%) of its employees earning $100,000 or more with the average compensation of all employees at $114,736.
  • San Francisco Municipal Transportation Agency: The SFMTA has more than two thirds (66%) percent of its employees earning $100,000 or more with the average compensation of all employees at $118,592. A total of 3814 employees earn $100,000 or more.
  • San Jose Department of Public Works: The SFPW has more than half (51%) of its employees earning $100,000 in compensation or more – with the average employee earning $102,017 a year. The San Jose Director of Transportation pulls in $460,671.
  • Santa Clara Valley Transit Authority (VTA): The VTA has sixty-four percent (64%) of its employees earning $100,000 or more – with the average employee earning $114,335. 1545 VTA employees pulling in $100,000 or more is more than the number of actual busses run by VTA!
  • Golden Gate Bridge, Highway and Transportation District: The GGTA has 71 percent of its employees (860) earning $100,000 or more – with the average employee earning $120,286.
  • San Diego Association of Governments: Forty-four percent of employees at SANDAG earns $100,000 or more per year.
  • Los Angeles Department of Public Works: More than one-out-of-three employees at LADPW earns $100,000 or more per year – with 1941 LADPW employees pulling in $100,000 or more. LADPW has more members of the $100,000 Club than crews assigned to fill potholes!
  • Los Angeles Metropolitan Transit Authority: More than forty-two percent of employees at LAMTA earns $100,000 or more per year – with 4476 LA Metro employees pulling in $100,000 or more. LA Metro has more members of the $100,000 Club than actual buses in its fleet!  LA Metro CEO Phillip Washington is pulling in a cool $425,016 a year in compensation.

#5. Six-Figure Bus Drivers – and Bus “Cleaners”

Santa Clara Valley Transit Authority (VTA) has three bus drivers that are paid over $200,000 in compensation – including Roy Stokes who pulled in a whopping $205,252. Almost half of VTA’s bus drivers earn $100,000 or more in compensation a year.

At LA Metro, over 655 bus drivers make more than $100,000 in compensation each year including one, Jose Lara, who earns a whopping $174,308 in compensation each year.   

OCTA (Orange County) is paying a “Coach Operator” $133,460 in compensation each year – and another 113 of the other bus drivers at OCTA also rake in over $100,000 each 

San Francisco Municipal Transportation Agency has a Transit Car Cleaner earning $158,075 for the top earner – with 76 Transit Car Cleaners earning over $100,000!

Golden Gate Bridge, Highway and Transportation District paid bus drivers Patrick A Depalma $227,181 last year and Raymond C.W Woo $204,307 this year. 

#6: Are You Kidding Me Club? Outrageous Compensation Well Above Local Labor Market

The politicians will try to argue that the $100,000 Club is arbitrary and the reason why so many government employees are earning six-figures is because of the “special skills” they possess.  In a complete refutation to this spin, this review uncovered some shockingly high compensation packages for lower-skilled positions.

  • Report to HR! Jeffery Stumbo serves as the San Diego MTS HR Director. Despite the fact that MTS only has 194 employees, “Jumbo” Stumbo earns a shocking $276,175 in compensation each year – that works out to be an indefensible $1,423.58 per employee HR file he maintains.
  • Doozy Decimal System: Caltrans even employs a pricey “Librarian” at a cost of $111,941 a year.  How many books does it take to fill a pothole?
  • Six-Figure Gardeners: Caltrans is paying a “Tree Maintenance Supervisor” $111,120 a year.
  • Executive Assistants: OCTA (Orange County) is paying an Executive Assistant $173,808 in compensation each year – and six Executive Assistants are making $100,000 or more each. At Sacramento RT we found an Executive Assistant earning $124,480. San Francisco Department of Public Works pays an Executive Assistant $123,812.
  • The Platinum Plumbers: Andrew Rella, a LA Metro plumber, is being paid $169,113 in compensation. San Francisco Department of Public works has a plumber earning $173,170 while San Francisco Municipal Transportation agency has a plumber at $188,336.
  • Didn’t They Check Angie’s List First?! San Francisco DPW is paying a Bricklayer: $142,928, a Painter: $139,695 and a Carpenter: $131,640. The San Francisco Municipal Transportation Agency pays a simple automotive mechanic $190,376! Golden Gate Bridge, Highway and Transportation District pays a dispatcher $182,849 a year and a bridge painter $178,856 a year. 

#7: Excessive Purchases with Gas Tax Funds

  • Fabulous Furnishings: In just the first 6 months after SB1’s gas and car tax was passed, Caltrans went on a spending spree buying new office furnishings – including the following purchases:
    • $50,000 for just one conference table
    • $13,000 on mattresses!
    • $2700 for an ice maker
    • $1400 for a new “executive desk” and $1400 for an office chair
    • $64,200 on new TVs
    • Glass table top $7,000
    • 3 outdoor dining sets for $11,000+
    • Lounge loveseats (3) $3100
    • Lounge chairs $800/piece for three
    • Over $250,000 for miscellaneous furniture items and reconfiguration

It wasn’t just Caltrans that went on a spending spree on these items. Orange County Transportation Authority authorized $240,000 for office furnishings and reconfigurations. SFMTA spent $25,000 for the purchase of one fancy conference table.

  • Massage Therapy: Gas tax funds were used to pay Holistic Exchange, Inc $300 for massages for 12 staff members in Merced County.
  • Lavish Parties: In early 2018, San Diego MTS celebrated the gas tax implementation with purchase orders including $7474 for a party at the exclusive Symphony Towers for MTS executives – including $780 in floral arrangements. They also got caught with their hand in the cookie jar  $3200 for a one-time purchase of “cookies,” and $5800 for yet another fiesta that included tacos at $8 for each taco! Ay caramba!
  • Exotic Travel: Local transportation agencies spent gas tax funds on a $5000 trip to Paris, Munich, and Milan, $2700 for a trip to Las Vegas! And a jaunt to China totaling more than $5,000 taxpayer dollars

#8: Gas Tax Being Used to Cover Operating Deficits

The San Diego Metropolitan Transit System faces a massive $9 million operating budget deficit this year and predicts years of declining ridership – with a ridership plummeting 10% in the last year alone.  Instead of implementing cost-savings reforms, MTS announced it will use its gas tax funds to plug 100% of its budget shortfall by using gas tax funds.

“Costs at MTS already exceed funding by $9 million, he said; if the gas tax increase survives November, the MTS board could use that money to plug its shortfall.” – Voice of San Diego, July 30, 2018

Link to VOSD article: https://www.voiceofsandiego.org/topics/government/audit-reveals-tough-decisions-coming-at-sandag/

#9: “Gold-Plated” Parking for the “Gold-Plated” Buses

Despite its claim to need more tax funds, SANDAG is looking at spending $75 million to build a temporary bus parking lot in the heart of downtown San Diego. The project concept began in 2012 at price tag of $15 million but has ballooned in cost since then.  Funding for project would come from funds that could otherwise be used to build roads.

Worse, the bus parking lot would only accommodate up to 18 buses (they currently park on the street) at a cost of $4,166,666 per bus!

If the outrageous cost-per-parking spot wasn’t enough, the owners of subject property do not wish to sell so SANDAG may pursue eminent domain and violate private property rights!

#10: Bloated Bureaucracies

  • LAO Says Caltrans Over-staffed by at least 1000 positions in one program alone!
  • Engineering Failure: Caltrans has 7,494 “Engineers” – that’s more than three Engineers for every active project!

“These outrageous examples of waste of our gas tax funds is proof that voters cannot trust California government agencies with even a penny more of their money until efficiency and accountability reforms can clean up these excessive expenditures,” said Carl DeMaio, Chairman of Yes on Prop 6 Gas Tax Repeal Campaign. “Voters can send a strong message by voting YES on Prop 6 to repeal the costly and unfair gas and car tax hikes,” DeMaio concluded.