Thursday, February 28, 2008

CATS eyes fare increase. What does that mean?

The Charlotte Area Transit System last night said it's considering raising fares later this year, as opposed to 2009, as planned. The looming recession will likely produce smaller increases in transit sales tax revenue than expected. Fuel prices are going up.

This isn't earth-shattering news. But after last fall's transit tax debate, CATS' finances have been under tremendous scrutiny.

Here are my thoughts on what the future holds:

1) Late last year, CATS floated the idea that it might be willing to spend more of its money to build the commuter rail line to the Lake Norman area. Its contribution is penciled in at 34 percent, but CATS hinted it could go higher to entice north Mecklenburg towns to help pay for it.

I think that option is over. There isn't enough money to pay for 40 or 45 percent of the commuter line - especially with the northeast extension being planned. That 11-mile line to the University City area is the top priority, as it should be.

2) The smaller than expected increases in sales tax revenue isn't a crisis. After 9-11, revenue from the transit sales tax shrunk for a year or two before growing significantly in the last three years. CATS is only projecting growth of 4 percent for the next two years, rather than 5.75 percent. The 5.75 percent average increase was over a 30-year period. The sales tax that funds Atlanta's MARTA, for instance, grew by an average of 6.7 percent since it was first enacted in 1973.

3) The increase in expenses is a bigger deal. CATS long-range financial plan is very aggressive when it comes to controlling costs, though history suggests that's a tall order for transit agencies. At last night's Metropolitan Transit Commission meeting, CATS ticked off a number of areas were costs are rising, in addition to fuel. The security budget is projected to be $5.4 million in 2009, up from $5 million in 2008. Maintenance costs are also rising.

CATS has big plans. I'm guessing in the next year it will create a revised schedule, pushing some projects back a year or two as it waits for the transit tax to generate more money. The 2030 plan - which wasn't finished until 2034 - might have to be renamed the 2037 plan.

6 comments:

Anonymous said...

Why should the University City line be the top priority? The Lake Norman commuter line was the top priority initially, before it was switched to the Pineville line. Remember?

Anonymous said...

CATS doesn't like it when local politicians get in their way. The mayor of Pineville said no, and the train stopped short of that town. Now the pols in CDH are saying no, we don't want to mortgage our futures, and CATS obviously doesn't want to get into a fight which will only air more of their ineptitude and financial bungling for all to see. UNCC, on the other hand, is practically begging for a train and they will do anything to get it.

Rick said...

If the Northern towns don't get their train they will pull out of the MTC and probably take a couple of the other towns with them. That would be the end of the transit plan as it stands now.

At that point it will be time to put-up-or-shut-up for CATS.

Why do you think the three northern mayors and Karen Bentley - previously a transit tax opponent - were the only people at the vote last Monday who spoke in support of the $8.5 million for the North Corridor engineering? They were there to make a point. "Do not screw us."

I wouldn't blame them if they pulled out. Why should they pay for trains in Charlotte if they are not getting any benefit?

As the transit tax debate last fall also pointed out, the transit plan has ABSOLUTELY NOTHING to do with transit. It is 100% about money and development - at least the high-dollar train portion of the plan that is.

Another option that could be thrown out there is this...

When the Northeast Corridor comes in at well over $1 billion rather than the current $750 million - a likely proposition - take the Northeast corridor back to the original plan and do it in 2 phases. (It's a relatively recent change in this saga that the Northeast extension would be done at one time.)

At that point whatever money is saved by shortening that line can be used to complete the North Corridor.

I ride an express bus just about every day, so don't start the petty name calling that I’m some mass transit opponent. It’s just unfortunate that Charlotte has a plan that is more about politics than actually moving people. For my part, when they raise the prices, I hope it goes to $2 for a regular ride and $2.50 for express. That would bring the cost structure more in line with reality.

Anonymous said...

Yeah, post 9/11 revenue streams, global warming, increase cost of fuel, outrageous cost of flagmen, blah, blah, blah. Not one sentence in that pile of you know what is or was about the truth or accountability. Nice work Sparky.

Anonymous said...

where are all you repeal the tax losers now? still in momma's basement most likely.

Right here booger eater. $500,000,000 on one light rail, one. It's not light rail that makes a city successful and it still is only serving a handful of commuters traveling in and out of the city on a daily basis. We still don't have an outerbelt and Raleigh is doing circles around us in road building. You can't move goods and services on light rail only brain dead fiscally impaired morons like yourself. The people who voted against the rail are those that realize that spending 8 billion on a system that will not reduce congestion or pollution are previously billed to understand that we need roads and not more lies. Something that clearly escapes you. Now clean off the keyboard, your parents will be home soon.

You are the classic liberal. Soak the the tax payer and ride on the gov't supplied heavily tax payer subsidized choo choo.

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