Metra 'boondoggle' is textbook case of mismanaging taxpayer money

Metra is blowing tens of millions of dollars, with terrible oversight, on a warehouse in Harvey it bought in 2020. This is why transit agency reforms are a must.

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A passenger and conductor approach a Metra train.

A Metra train at Union Station. Metra bought a south suburban warehouse for $6.8 million in 2020, but the purchase did not follow any formal purchasing procedures.

Sun-Times file

“What was supposed to be a simple storage warehouse for the Metra transit agency has now buried the nation’s fourth-busiest commuter rail system in a sinking money pit, the ABC7 I-Team has learned.”

The Chicago broadcast station’s scoop last week is an almost perfect encapsulation of why northeastern Illinois’ mass transit fiefdoms need to be busted and reformed.

For your background, the Chicago regional transit system is facing a steep $730 million fiscal cliff in fiscal year 2026, which starts a year from July 1. Gov. J.B. Pritzker and several legislators are demanding that, in exchange for any new operating money, the management of the Chicago Transit Authority, Metra, Pace and the Regional Transportation Authority all be reformed. They’ve all operated as fiefdoms for decades, resisting accountability, cooperation and any attempts to streamline management.

The CTA is the most well-known villain in the transit governance debacles, but it clearly ain’t alone.

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Metra bought a south suburban warehouse for $6.8 million in 2020. The purchase did not follow any formal purchasing procedures because, apparently, Metra doesn’t have any. Nobody at Metra would even admit to knowing who touted the property, which was owned at the time by a Metra hand sanitizer provider.

“The [internal Metra report] also stated it could not identify which Metra staffer initially brought the Harvey warehouse property sale option to the Executive Leadership Team prior to its board approval,” ABC7 reported.

Metra CEO Jim Derwinski speaks into a microphone.

Metra CEO Jim Derwinski.

Pat Nabong/Sun-Times

Was the property brought to the agency by an independent broker? “No,” Metra’s CEO Jim Derwinski told his board last month. "(T)his was mostly our engineering and materials management team out looking for something that was available,” Derwinski said, according to the ABC7 report.

Unreal.

“Derwinski said the agency was facing potential layoffs of its workforce [during the pandemic], and Metra’s executive leadership team saw the building purchase as an opportunity to repurpose employees to work on and make improvements to the warehouse,” the station reported. Um, they have no union contracts over there?

Metra bought the property “as is” and has since spent another $11.1 million. But the property will require “tens of millions of dollars more to finish” and will take at least two more years, the report continued.

OK, look, Harvey definitely needs investment. And I will be the first to admit our state procurement laws are an unnecessarily complicated mess. Small businesses and nonprofits simply do not have the ability to navigate those laws unassisted, which makes handing out grants an excruciating process.

No purchasing process?

But, I mean, what the heck is going on over there? Metra is throwing tens of millions of dollars at a warehouse without any sort of purchasing process? The board seemed to be surprised at how deep a hole the agency had dug itself into during its meeting last month. That’s a massive failure by the board, but where the heck are the operating rules?

The thing that just completely blew my mind about the ABC7 story was Derwinski’s cavalier attitude about the taxpayer money it had spent and is committed to spending in the future.

Metra was running short on operating dollars during the pandemic, Derwinski explained, so the agency “saw an opportunity to shift workforce into this building at that period of time to keep them working under capital dollars.” The original purchase was made with state Rebuild Illinois bond funds.

“The fiscal cliff is an operating dollar problem,” Derwinski said. “The capital dollar side about making, taking care of the assets that we’re entrusted to take care of, that’s this conversation right here. The fiscal cliff, it’s real. It’s big. But that really has to do with the operation.”

Excuse me, but how the heck is the state government supposed to trust Metra to spend a massive operations bailout wisely when it’s blowing tens of millions of capital dollars on a boondoggle with no discernible process and almost criminally lax oversight and shrugging it all off as no big deal?

This is exactly why reforms are necessary.

Bust. The. Fiefdoms.

Rich Miller also publishes Capitol Fax, a daily political newsletter, and CapitolFax.com.

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