07 CAFR cover FINAL.p65 - WMATA.com

Washington Metropolitan Area Transit AuthorityFY 2007 Comprehensive Annual Financial ReportManagement’s Discussion and AnalysisStatements of Revenues, Expenses, and Changes in Net Assets (Continued)Revenues (Continued)Capital contributions to the Authority increased by $173.8 million or 58.5 percent, primarily due to delayed receiptof prior year federal grants and an increase in Metro Matters jurisdictional billings. Metro Matters is a partnershipbetween the Authority and the Washington metropolitan area jurisdictions to maintain and improve the threedecadeold transit system.ExpensesCurrent YearTotal expenses increased by $131.7 million or 8.4 percent to $1.7 billion in Fiscal Year 2007 as compared to $1.6billion for Fiscal Year 2006. A review of significant changes in operating expenses is described below.Salaries and benefits increased by $67.9 million or 8.4 percent. Salaries and benefits were driven by contractualwage increases and increased levels of revenue vehicle maintenance and system enhancements. AdditionalTransit Police were added for general safety and security as well as for Washington sporting events, nationalcapital events and festivals.Services increased by $15.8 million or 15.5 percent. Service Expenses were $117.9 million as compared toFiscal Year 2006 with costs of $102.1 million. The increase in costs was primarily driven by the increased usageof MetroAccess, SmartCard service and transportation consultation services.Materials and supplies increased by $21.1 million or 17.1 percent. The steadily increasing cost for fuel accountedfor the largest portion of this increase.Utilities increased by $5.3 million or 7.9 percent, due to increased propulsion usage to operate eight-carpassenger trains and higher natural gas costs.Fiscal Year 2007 ExpensesLabor/Fringes51%Interest Expense6%Services7%Depreciation andAmortization21%Casualty and Liability2%Utilities4%Materials andSupplies9%17