- Do other states’ commuter rail operations contracts contain: (a) specific performance standards, (b) provisions for evaluating or monitoring a contractor’s performance, and (c) methods for the state or oversight body to enforce performance-related contract provisions?
- How do these contract provisions compare to those in Connecticut’s contract with Metro North?
Other states’ commuter rail service contracts that we reviewed include performance standards, monitoring and evaluation requirements, and enforcement methods. The inclusion of such provisions reflects the fact that these contracts are between quasi-public regional transit authorities and private companies they selected to provide commuter rail services. In contrast, Connecticut’s commuter rail contract is between two governmental entities—Connecticut Department of Transportation (CDOT) and Metro North, a subsidiary of New York’s quasi-public Metropolitan Transit Authority. Connecticut appears to be the only state that has this arrangement.
To prepare this analysis, we contacted 20 transit authorities that use private contractors to operate their commuter rail lines and requested copies of their contracts. At this time, only South Florida Regional Transportation Authority (SFRTA) and San Joaquin Regional Rail Commission (SJRRC) sent copies of their contracts for their commuter lines, Tri-Rail and Altamont Corridor Express (ACE) respectively. We will update this report if we receive more contracts.
The Tri-Rail and ACE contracts have very similar performance standards and evaluation and enforcement requirements. Both establish standards for operations, safety, and customer service and require the contractor’s employees to meet minimum qualifications. They also require their contractors to develop and submit for approval operating plans and standards that go beyond those specified in the contract.
SFRTA and SJRRC evaluate performance primarily through periodic reports from the contractor and require the contractor to make performance data accessible at any time. In addition to reporting, SFRTA requires managers to evaluate their crew members for adherence to operation policies and SJRRC assigns a representative to every ACE train.
Financial penalties for failing to meet certain performance standards is the primary method SFRTA and SJRRC use to enforce these standards. Both agencies also have the right to (1) withhold payment for unsatisfactory performance and (2) terminate contracts if the contractor fails to remedy a contractual default. SFRTA also uses financial incentives to encourage on-time performance and safe operations.
The contract between Metro North and CDOT is very different than the contracts for Tri-Rail and ACE. Although it states broad performance goals, it does not impose specific performance standards on Metro North. Except for provisions requiring a one-time productivity review and the right to examine records, CDOT’s contract includes no ongoing reporting and monitoring requirements.
Finally, the Metro North contract does not provide CDOT with a method of recourse if Metro North performs unsatisfactorily. CDOT may enter into arbitration or terminate the contract if Metro North defaults on the contract, but may not withhold payment or levy penalties for unsatisfactory performance.
CDOT and Metro North have updated their contract by entering into many memorandums of understanding. We have not examined all of these memorandums, but according to CDOT, none involve performance evaluation.
For more information, read the full report.
