In this seventh Annual Report on the Performance and Condition of the Washington Metropolitan Area Transit Authority (WMATA), the Northern Virginia Transportation Commission (NVTC) is proud to continue advancing public transit in Northern Virginia by presenting timely policy recommendations as the region develops strategies to address long-term, sustainable funding for WMATA. At varying scales and timelines, transit agencies nationwide face unparalleled budget deficits as once reliable revenue streams struggle to keep pace with increased costs as a result of the COVID-19 pandemic which upended ridership and brought historic levels of inflation across all industries. WMATA faces unprecedented deficits in its operating and capital budgets should a long-term funding solution not be realized.

In June 2023, WMATA announced a forecasted FY 2025 operating budget gap of $750 million. Working closely with regional partners including NVTC and the Commonwealth of Virginia, WMATA successfully closed its operating budget gap using several budget tools, including preventive maintenance transfers, fare increases, targeted service adjustments and significantly higher levels of additional jurisdictional contributions from Virginia, Maryland and the District of Columbia.

Northern Virginia jurisdictions, in partnership with the Commonwealth through its biennium budget, successfully crafted a two-year funding solution that ensures WMATA’s continued post-pandemic ridership recovery. For FY 2025, Virginia has agreed to provide an additional $119 million and for FY 2026, an additional $169 million, both split between local jurisdictions in Northern Virginia and the Commonwealth.

As the region collectively worked to develop a temporary funding solution, additional clarity on the post-pandemic funding needs of other transit agencies shifted the focus to finding a long-term, sustainable, dedicated funding solution for WMATA and Northern Virginia’s other public transit agencies. WMATA, in partnership with the Metropolitan Washington Council of Governments (MWCOG), commenced the DMVMoves effort to identify long-term funding needs and possible funding mechanisms while Virginia’s General Assembly established a Joint Subcommittee to study Virginia’s share of those future needs and ways to meet them with new potential revenues and cost containment measures.

Front and center in the regional conversations taking place regarding long-term funding are strategies to contain cost growth, as evidenced in this report. WMATA made great strides over the last year in identifying cost savings in its operating and capital budgets by reducing administrative costs, tackling fare evasion on the Metrorail system with the installation of new faregates and, perhaps most notably, the execution of the new collective bargaining agreement with Amalgamated Transit Union (ATU) Local 689 – the largest of WMATA’s labor unions – featuring a wage freeze for FY 2025 and further cost controls thereafter. WMATA has communicated these cost containment measures effectively to its funding jurisdictions and the public.

Time is of the essence: NVTC recognizes the opportunity at hand and offers the recommendations in this report to continue advancing a better transit future for Northern Virginia and its residents who deserve a robust and well-funded public transportation network.