Q1 Financial Performance Report June 20, 2019 NO ACTION REQUIRED - PowerPoint PPT Presentation

Q1 Financial Performance Report June 20, 2019

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Executive Summary – 2019 Q1 Performance • Tax revenues closely tracking budget. • Capital spending lower than budget due to weather impacts, slower right of way acquisition, and other factors. • Operating spending currently lower than budget, continues to increase year-over-year at a rate outpacing CPI. 3

Executive Summary – Financial Projections Long Term Outlook • Capacity as currently projected remains sufficient to fund voter-approved program. • Long term capacity could be under stress due to continued hot construction and real estate market, and higher operating cost growth. 4

Q1 Financial Performance

2019 Q1 Revenue & Financing Performance ($M) • Total Q1 revenues of $496.7M $3,000 are 2% below budget mainly due $2,422 $2,422 $2,500 to a delayed federal grant drawdown of $19.5M for $2,000 Lynnwood Link $1,500 • Q1 tax revenues of $429.3M are $1,000 1% above budget $507 $497 $500 • Revenues are forecasted to $0 2019 Q1 2019 Q1 2019 2019 meet annual budget of $2.4B Budget Actuals Budget Forecast 6

2019 Q1 Capital Project Performance - System Expansion $102M or 25% below budget. Projected to be at 96% of budget at year- end ($M) $2,500 $2,280 $2,188 $2,000 $1,500 $1,000 $401 $500 $303 $- Q1 Budget Q1 Actuals 2019 Budget 2019 Forecast 7

2019 Q1 Capital Project Performance - System Expansion (continued) Main drivers of performance variance: • Significant adverse weather conditions impacted construction performance • Protracted negotiations with GCCM contractors caused delay in start of early construction work for Lynwood Link Extension • Protracted negotiations with property owners resulted in delays in ROW acquisition (Lynnwood and Downtown Redmond) 8

Main drivers of capital project performance variance (continued) • LRV fleet expansion manufacturer was challenged meeting Q1 milestone, resulting in no payment • Prolonged negotiations on agreements and settlements with cities, WSDOT, and contractors delayed planned payments Despite the delays in the first quarter, it is anticipated that progress will pick up in subsequent quarters to maintain year end projection/performance at 96% 9

2019 Q1 Capital Project Performance - Non-System Expansion Enhancement Projects State of Good Repair Administrative Projects $1.4M or 28% below budget $2.9M or 78% below budget $0.2M or 20% below budget $45 $40 $36 $39 $40 $9 $34 $35 $8 $8 $35 $8 $30 $26 $7 $30 $25 $25 $6 $20 $5 $20 $15 $4 $15 $3 $10 $5 $10 $4 $4 $2 $5 $1 $5 $1 $1 $1 $- $- $- Q1 Q1 2019 2019 Q1 Q1 2019 2019 Q1 Q1 2019 2019 Budget Actuals Budget Forecast Budget Actuals Budget Forecast Budget Actuals Budget Forecast • Escalator Modernization program • Five projects are behind budget • Delay in procurement of the SharePoint procurement delay; PIMS and TOD schedule; DSTT SOGR work pending Upgrade and the Operations projects are behind budget agency agreement on scope. Performance Reporting Software. schedule. • Expected 140% at year-end due to • Expected 98% at year-end. • Expected 88% at year-end. early delivery of 12 buses. 10

2019 Q1 Transit Modes Operating Budget Performance - Fare Revenue $120 $103 • 4% below budget $98 $100 • Ridership lower than budget across Dollars (Millions) $80 all modes, partially due to snow storms in February. $60 $40 • Expected to be at 95% of budget at $24 $23 year-end $20 $0 Q1 Q1 2019 2019 Budget Actuals Budget Forecast 11

2019 Q1 Transit Modes Operating Budget Performance - Expenditures • 8% under budget in Q1 $400 $354 $353 • Main drivers: • $300 Lower security hours Dollars (Millions) • High vacancies • Lower spare parts $200 consumption • Delayed rail grinding $89 $82 $100 • 12% year over year cost growth • $0 Year-end performance is Q1 Q1 2019 2019 expected to meet or potentially Budget Actuals Budget Forecast exceed budget 12

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