City leaders outlined next steps Thursday for mending the fractured Charlotte Area Transit System, including a federal review and temporary suspension of the CEO search.

Why it matters: For the past year, CATS has grappled with low ridership, poor reliability, staff vacancies, a near workers strike and slow progress on its long-term transit goals. In November, CEO John Lewis resigned amid the controversy, leaving behind the growing list of problems.

• “A lot of things are being discovered. A lot of issues, especially around the employees, are beginning to be addressed,” city manager Marcus Jones told reporters during a virtual press briefing.

The latest: Last month interim CEO Brent Cagle revealed a light rail train derailed on May 21. No city leaders said they knew about it.

But Jones corrected himself Thursday. He said he found a text from Lewis in May. The former CATS CEO was notifying him about the derailment: “FYI, we just had a minor derailment,” the text began, according to Jones.

• The city manager said he usually replies to Lewis or sends a thumbs up, but he never addressed this text.
• “It’s an honest mistake,” Jones said. It’s up to council whether they want to discipline Jones.

Of note: Deferred maintenance contributed to the light rail derailment, according to NCDOT documents. Letters show CATS did not submit an acceptable “corrective action plan” to NCDOT, explaining how it would address the hazards, until late February.

Councilman Ed Driggs told reporters Thursday the derailment wasn’t a “headline event. These are occurrences that can happen in rail travel just as a bus can occasionally break down.”

• Asked if the light rail was safe, Cagle said NCDOT never suggested CATS should stop running the light rail.

Jones, Cagle and Driggs shared the following next steps for CATS during the briefing:

• The Federal Transit Agency will conduct an off-cycle review of CATS. It will investigate whether protocol was followed during the derailment as well as the agency’s budget and maintenance processes.
• The search for CATS CEO is suspended for six months. Before it resumes, Cagle is expected to stabilize the organization in the interim role.
• Council will form an oversight workgroup that will meet with CATS management and report back to the full body.
• CATS is hiring consulting firm The DiJulius Group to strengthen its leadership, culture and customer experience.

What they’re saying: Cagle said CATS reached its current state because of issues that were both in and out of leaderships’ control. Those include COVID, violence against bus drivers, disagreement amongst the executive team and lack of communication.

Driggs acknowledged that, in hindsight, council should have paid closer attention to issues with CATS that were brought to light in the media. He said council relied on the “wrong people.”

• “But I think the important thing to note is those people aren’t here anymore,” Driggs said. “And I’m not saying they were all dismissed, but I’m just saying they’re not here. That is a big step.”

Zoom out: City manager Jones does not anticipate the major issues in CATS to prevent the city from reaching its other long-term transit goals, including building the Silver Line light rail. He said there was a transit meeting with regional leaders this week.

• “There’s a lot of work that’s happening with our council members that are talking to legislators in Raleigh, talking to legislators in D.C. as recently as this week,” Jones said. “There are a number of staff members who are working on the plans, the designs.”

But Jones acknowledged they are unprepared to ask legislatures for the authority to place a one-cent sales tax referendum on the ballot this legislative session. The city would need the revenue from a tax increase to put its $13.5 billion in mobility plans in motion.

Go deeper: Charlotte has barely tried to convince state leaders of its transit plans, records show