The [Friday] Papers
"A new Ventra problem emerged Thursday in connection with the commuter benefits program, which offers tax advantages to employers and their employees to pay for transit fares using pretax income. Employees who formerly had their pretax money loaded onto Chicago Cards are now being transitioned to Ventra cards," Jon Hilkevitch reports for the Tribune reports.
"But Thursday's debut of the Ventra commuter benefits website included instances of employees being associated with the wrong employers, several company administrators told the Tribune.
"CTA spokeswoman Tammy Chase confirmed that the transit agency received calls from 'a few employers' on the issue. A preliminary analysis indicates that no employer or employee information was compromised, she said.
"But asked specifically by the Tribune whether employees' Social Security numbers and other private information was breached, Chase responded: 'We contacted Cubic, because it is their website and they are in the process of resolving the issue.'
"Cubic Transportation Systems Inc., is the Ventra contractor. Cubic's policy is to refer all media questions on Ventra to the CTA, Cubic spokeswoman Kim Gregory said."
What a Loop of Hell. It's like Comcast referring you to Peoples Gas and getting referred back again.
But that's not all.
"A new problem is hitting the Chicago Transit Authority's Ventra fare system, and this one potentially is much more serious than mere passenger inconvenience," Greg Hinz reports for Crain's.
"According to JPMorgan Chase & Co., which has more retail customers in the Chicago area than any other bank, the Ventra system is deducting funds from the accounts of some clients whose Chase debit cards are supposed to work only if the customer punches in an authorizing personal identification number.
"It has occurred when a CTA rider swiped their wallet or purse as they boarded a CTA vehicle, and the Ventra station reads and charges not the number on the Ventra card but a Chase debit card in the same wallet or purse."
(Isn't that the same problem the Sun-Times reported on in September? Ventra: What's Not In Your Wallet.)
It gets better.
"CTA spokeswoman Tammy Chase suggested the problem is at Chase's end, not the CTA's or that of Ventra provider Cubic Transportation Systems."
Comcast says it's Sprint's problem, not AOL's! It's the Triple Lindy!
Even before these latest problems it had been an awful week for Ventra.
On Monday, Jason Prechtel reported for Gapers Block that Cubic has a long record of dismal failure that spans the globe.
On Tuesday, the Tribune reported that "A CTA public budget hearing [Tuesday] turned into a forum for commuters to air their grievances over the troubled Ventra fare-payment system."
(CTA board members didn't respond to the complaining public speakers, which is frustrating, but at least they didn't tell them to go complain to Cubic instead. This, though, did happen.)
On Wednesday, the Tribune reported that "The troubled Ventra fare-payment system took another hit during the Wednesday evening rush hour when some card readers at 60 of the CTA's 145 train stations failed, resulting in 15,000 free rides for commuters before the problem was fixed, according to the agency."
The Ventra folks are not returning the favor.
"The driving force here is the Chicago Transit Authority putting everyone on notice that they had to convert to a new card in a very short time period," Jay Thomas, Cubic's chief financial officer, told the company's hometown newspaper. "It's an unusual rollout strategy, but it is what the customer wanted to do."
I'm gonna enter the realm of speculation here and guess that - besides Rahm's famous and intemperate impatience - the last thing the mayor wanted was to introduce Ventra in the winter. Could you imagine how much more miserable and maddening this would be in the dead of January? So it's entirely possible the CTA rushed the rollout.
I don't see how Claypool isn't culpable, either. Obviously the right controls and testing weren't in place - particularly for a company with Cubic's track record (which makes one wonder how they got the contract in the first place).
Somehow, though, I don't think we'll ever get a (sincere) "It's on me" out of Rahm.
There are deeper questions to ask about Ventra, though, and Mark W. Anderson of NBC's Ward Room blog is among those who have been asking them. From a series of his posts:
Public-private partnerships (PPPs), like the one the CTA entered into to run Ventra, involve all parties getting something out of the deal. For the CTA, it looks easy: they don't have to be in the fare collecting business anymore. And, a new contactless fare system can provide riders with an enhanced level of convenience.
"Ventra, the new CTA transit fare collection system, includes a pre-paid debit card function that gives riders the ability to load up their cards with funds and to use their transit card as a debit card.
In other words, what Ventra is designed to do has very little to do with convenience or efficiency but instead is a way to for selected financial services partners to issue debit cards to a captive audience. It's somewhat ingenious, if not downright sleazy. CTA's customers are now not only guinea pigs but marks.
The banking partner chosen as part of the Ventra program appears to have a long history of legal problems related to prior participation in prepaid debit schemes and other activities.
Okay, so what does the CTA get out of it?
"[U]nder the Cubic contract, the CTA is guaranteed a minimum half-million dollars a year in nonfarebox revenue. Some of it will be paid by Ventra debit account customers who are assessed fees. For instance, the CTA will receive a portion of the $2 monthly inactivity fee that Ventra MasterCard customers will be charged if they don't use their retail card at least once over an 18-month period. The prepaid debit account program will be administered by First Data Corp."
This is a really bad idea.
The Ventra system is, in effect, a transfer of wealth as private vendors prey on those who rely most on public transportation. The CTA will brag about its cut, but it comes from fees on passengers. For some, fares will become quite expensive!
Meanwhile, another tradeoff that transfers wealth:
"Coming a few days after Ventra's launch was another announcement - the elimination of 149 positions at CTA," Yana Kunichoff wrote for the Chicago Reporter in September.
"About one-third of the jobs the Chicago Transit Board voted to remove will become redundant because of Ventra."
This is what we're talking about when we talk about privatization: Less accountability, fewer jobs, more profits to the select few.
Back to Kunichoff:
"[T]he transition to Ventra was a move away from the CTA's 20-year-old fare collection system. 'When things get old and deteriorated enough, the technology is no longer available," [our old friend Tammy Chase] said. "Some of the jobs that we have had traditionally, where we would send a CTA employee out to fix [an issue,] now we don't have to do that anymore."
Au contraire. Fixing fare equipment is part and parcel of running buses and trains. Maybe outsource your PR instead because you're not in the communications business!
And that's what's really sad: The CTA, like the City itself, doesn't know what business it's in anymore. It's a classic business school case study, like when, to use a cliche, the horse-and-buggy people thought they were in the horse-and-buggy business when they were really in the transportation business. Dear CTA: You're not a bank.
Another business school lesson: You have to own the customer experience from start to finish. Know your fare boxes, fix your fare boxes. Relying on contractors diffuses authority and accountability, and puts distance between yourself and the customer. Presuming you care about your customer.
Finally, just to add to the long list of things keeping you up at night: Cubic is also supplying our military with services such as combat training and advanced laser research.
Kunichoff reports in another post that "Cubic provides weapons training for the military; offers technology that transmits surveillance data from unmanned aerial vehicles, also known as drones; and tracks assets all over the world for both private and military clients . . . In fact, the company's operations are so wide-ranging that its website says 'nearly every U.S. and allied soldier and fighter pilot has trained or will train for a mission using Cubic equipment.'"
And then each soldier will be enrolled with a prepaid debit card!
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Posted on November 15, 2013
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