Funding Conflicts
The source of Capital Metro's funding has been a source of considerable and consistent controversy since the transit authority's founding in 1985. In December 1988, the board of directors voluntarily lowered the sales and use tax to 0.75-cent. In June 1995, the Board of Directors reinstated the sales and use tax to the full one percent effective October 1, 1995, promising to set aside the additional revenue for funding light rail.
Capital Metro, after raising its sale tax from 0.75 percent to 1 percent in 1995, had stockpiled $176 million by the 2000 referendum. When light rail was defeated at the polls in 2000, however, pressure mounted to return the quarter-cent it had been setting aside for rail projects. For years, mass transit detractors had coveted the quarter percentage earmarked for rail projects. Political leaders and organizations, including former Republican state Rep. Terry Keel of Austin, Travis County Commissioner Gerald Daugherty and his anti-rail group Reclaim Our Allocated Dollars (ROAD), wanted the sales-tax money to build projects such as a highway loop around Austin and an east-west freeway. As pressure mounted on Capital Metro, Keel announced his intention to roll Capital Metro's taxing authority back to a half-cent and redirecting the other half-cent to highway construction.
To head that off and keep rail's future prospects alive, the Capital Metro board passed resolutions in the months after the vote making two promises: It would direct $91 million of its existing reserves to local governments for transportation projects, and it would dispense all proceeds that year from a quarter-cent of its tax to those same local governments. That quarter-cent promise was later extended for three more years, eventually amounting to $113 million, for a total of $204 million.
The city of Austin, given that something on the order of 97 percent of Capital Metro sales taxes come from within the city, was to be the primary beneficiary of those promises. Since 2000, at least $106 million of the $204 million promised to Austin and smaller cities such as Manor and Leander. At the same time, however, it was spending more than $300 million on commuter rail, park-and-ride lots, a new maintenance and operations center, and other facilities. As the Great Recession spread to Austin in 2009, tax revenues dried up and Capital Metro had to stop payment on a $51 million load owed to Austin as part of a 2001 agreement.
Read more about this topic: Capital Metropolitan Transportation Authority
Famous quotes containing the word conflicts:
“In motherhood, where seemingly opposite realities can be simultaneously true, the role of nurturer invariably conflicts with the role of socializer. When trouble came as it surely must, was I the good cop who understood, the bad cop who terrorized, or both?”
—Mary Kay Blakely (20th century)