Chief financial officer leaving SMART as staff turnover adds to agency’s challenges

SMART is poised to lose two key staff members, including its longtime finance chief, as staff turnover adds to the challenges faced by the North Bay’s transit agency, which is trying to recast its uncertain future in the face of the pandemic recession and pre-existing budget woes.

Erin McGrath, the agency’s chief financial officer of nearly a decade, will step down from her post when her contract expires in December, SMART General Manager Farhad Mansourian announced Wednesday at the agency’s regular board meeting. A search for her replacement has already begun, he said.

“It’s very mixed emotions, of course. She’s been terrific,” Mansourian told the board. “We will continue to figure out how we can have her change her mind. But I’m grateful she is giving us so many months of notice so we can figure out if there is a miracle to find somebody who can even begin to fill her shoes.”

McGrath, who was unavailable for an interview Wednesday, did not comment at the meeting about her decision to leave. She chose not to seek renewal of her contract in favor of a career change and to be nearer to family in Southern California, according to Julia Gonzalez, SMART’s spokeswoman.

McGrath, who made $252,255 in salary last year is SMART’s third-highest paid employee, behind Mansourian and Tom Lyons, the agency’s attorney, according to SMART.

Gonzalez, the spokeswoman who oversees marketing and community outreach, is also leaving. She has been with the agency for nearly a year and has accepted a similar role as vice president of strategic communications at Sonoma State University, where she starts Sept. 14.

“This is an opportunity for me to return to my professional roots, working to promote and advance higher education,” Gonzalez said in a written statement released by the university. “SSU is integral to the North Bay and I am honored to steer the communications and branding, especially as the region emerges from the pandemic.”

The sudden turnover adds to the mix of obstacles SMART is staring down this year after a regional shutdown connected to the coronavirus sapped the agency’s ridership and stripped away millions of dollars of sales tax revenues that fund the system. The agency quietly marked three years of service last week, counting more than 1.9 million passengers since its launch in 2017.

Like all regional public transit agencies, SMART has struggled with keeping afloat financially during the pandemic, with a small rebound in passengers since the low point of the shutdown in early April. To cut costs, the agency is running 16 trains per day, or about 40% of its pre-COVID schedule, and offering no weekend service.

“We have not had an easy time, and I’m just really proud of all the staff and everybody that keeps our train running. They’re doing an outstanding job, and I’m glad to see ridership start to creep back up,” said Windsor Councilwoman Deb Fudge, one of SMART’s longest-tenured board members.

During the board’s first meeting in almost two months, McGrath shared news that final sales tax revenues from last year came back $6 million higher than the agency projected as it approved an amended budget in June. Coupled with an almost $2 million shortfall in expected federal emergency aid, SMART will close out last year’s budget $4 million ahead, helping limit the financial hit from the coronavirus.

“It’s a small bit of good news amidst all of the bad news that we all face every day,” McGrath told board members Wednesday. “We’ll continue to follow all the economic forecasts in the region. They’re talking about impacts into 2024, so it’s important that we try to stay lean and mean and keep our eye on the future.”

Part of that future will include taking over freight operations with SMART’s state-funded $4 million buyout of the current hauler, Northwestern Pacific Railroad Co. Mansourian confirmed that board-approved plan, which required Gov. Gavin Newsom’s signature, is on track and SMART next will look to hire a consultant to better understand the market realities that may help produce commercial revenue for the system once the deal is finalized later this year.

“There’s a lot of possibilities here, and hopefully it’ll make money, too, for us,” said Sonoma County Supervisor Shirlee Zane, a SMART board member. “It will help us subsidize some of the costs of the passenger train. In an ideal world, that would be the best business deal to have.”

Later in the evening, SMART hosted the first of several planned virtual listening sessions, launched in response to voters rejecting the agency’s bid for an early sales tax extension in March. The renewal was billed as a way for the agency to refinance rising debt payments tied to construction of the rail line. The measure lost by 13 points, a bruising setback for a still-young transit provider trying to attract more riders and win broader public support.

About 50 people, including elected officials, a majority of the 12-member SMART board, SMART advocates and a few opponents, attended the Wednesday evening session geared for Santa Rosa residents. Mayor Tom Schwedhelm offered opening remarks thanking people for attending, encouraging them to be candid to help forge SMART’s future.

“Really, my belief is feedback is a gift,” Schwedhelm said. “There have been some bumps in the road, but what I really want to stress for the SMART folks is let’s partner with all of these issues, because it’s going to take all of us to make this successful. I would love to have the feeling that this is being done with us, and not to us.”

More than a dozen members of the public spoke during the 90-minute session.

Novato resident Joakim Osthus said he rode SMART north to his job in Windsor before the stay-home orders in March led him to work from home. He urged the agency not to cut the service too deeply as it considers more budget reductions.

“I just request that when you do take those decisions up, not to go overboard in cutting frequency and schedule of service to the point that you’re kind of not remaining a relevant mode of transportation,” Osthus said. “I know it can be easy to cut some runs here and there, but if you cut too much, then we start losing more people than just the people that might have been on that very train there.”

You can reach Staff Writer Kevin Fixler at 707-521-5336 or kevin.fixler@pressdemocrat.com. On Twitter @kfixler.