Montgomery County Taxpayers League Meeting
www.mctaxpayersleague.org
Wednesday, October 21, 2015 - 7:00 - 9:00 pm
6th Floor Conference Room, Council Office Building
100 Maryland Avenue, Rockville, MD 20850
Topic: " Independent Transit Authority - Financial Boom or Bust?"
Speakers:
Mark Winston, Chair, Montgomery County Transit Task Force
Rich Parsons, Member, Montgomery County Transit Task Force
Questions sent to both speakers in advance of the meeting:
1. Affordability - Given the huge construction and operating costs associated with the Purple Line, its not entirely risk-free public-private partnership, and the generally rosy cost projections at the beginning of such mega projects, can County taxpayers afford another mega project - the BRT and CCT - which will cost $2.2 billion in capital and $3.5 billion in interest in Phase 1 alone? Do you agree?
2. Borrowing Costs- contrary to the draft report's logic, debt incurred by the proposed Independent Transit Authority (ITA)would have a higher interest rate than that of the county, and would be several percentage points above the state's borrowing rate. ITA debt would incur over $1 billion in extra interest costs, ironically reducing funds available for transit projects, and resulting in a frozen capital market if rates jump. A state infrastructure bank would reduce interest rate risks and costs. Do you agree?
3. Operating Costs- The proposed ITA will receive nominal revenue sources from operations (unlike the WSSC) and will depend heavily on undefined and likely unsustainable Federal and state tax revenues ($40M). This could result in "going concern" issues during economic downturns. Also, shifting current DOT costs to the proposed ITA would have to be offset by property tax credits to avoid using the ITA as an ATM to re-purpose current county revenues. A state infrastructure bank could help smooth revenue issues during a downturn and avoid the need for a separate ITA bureaucracy altogether. Do you agree?
4. Economic Development- planned tax increases on top of the already high and growing county tax burden will undermine economic development. Why increase local taxes when calculated state benefits are many times greater than those of the county? Establishing a state infrastructure bank to finance the projects shifts taxes and risks to the state which has more control over taxes. Do you agree?
5. Ridership projections - The underpinnings of arguments for the BRT have been glowing ridership projections. However, the Institute for Transportation and Development Policy in its 2012 Market and Demand Study for the County concluded that the potential peak hour BRT usage on Route 29 is only 66% of the Federal Transit Administration's minimum standard for BRT ridership. Viers Mill Road and Rockville Pike peak hour demands are estimated at about 25% of the minimum. Do you agree with these figures? Is there a credible study of an urban area similar to Montgomery County that shows a sufficient number/percentage of motorists switching to a BRT system that would justify the enormous costs and accompanying tax increases associated with it?
6. Paying the Piper - Who should cover the costs of this large and ambitious venture? The business community that will gain from it? The residents along the route? The riders who will use the BRT? All the taxpayers of Montgomery County? Also, who should be held accountable when costs exceed projections?
Showing posts with label Independent Transit Authority. Show all posts
Showing posts with label Independent Transit Authority. Show all posts
Tuesday, October 20, 2015
Monday, January 26, 2015
Jan. 30th 6 PM: Hearing on New Special Taxes for Montgomery County Residents
http://www.
In a surprise move last, Thursday, County Executive Ike Leggett sent "late" bill MC 24-15 to our Montgomery County delegation in Annapolis asking for authority to create an Independent Transit Authority funded by a tax added to our property tax that is not subjected to current limits on that tax's increases. The bill is late because it was submitted seven weeks after county bills were due. Most County submitted bills are discussed in public hearings in Rockville in early December. The late submission means there was no public, transparent consideration of the bill – despite the fact that the consultant’s report that formed the basis of this bill was submitted to the County Executive more than one year ago, and was never presented to the Rapid Transit System steering committee.
This bill needs approval by the state legislature before the County can move on it. Late bills are considered on a fast track in Annapolis . The Montgomery County House delegation on Friday voted 19-4 to accept this legislation, and it may well be voted on by both houses before the scheduled April 13 adjournment. In response to a flood of protests from civic activists, legislators have agreed to hold a required hearing in Rockville instead of Annapolis on Friday, January 30, at 6pm.
If passed, this bill will allow the County to create an Independent Transit Authority (ITA). The County needs State authority to create such an agency. Concern among budget and legislation watchers is that there was a lack of transparency leading up to the submission of this bill and no public discussion, yet it gives authority to a new independent agency – and gives the agency authority to circumvent the County Charter 's limit on property tax increases.
Whether an Independent Transit Authority is a good idea or not, the details and impacts of this legislation need to be publicly debated and discussed before it goes to Annapolis for approval. The stealth with which this bill was developed and submitted lead many to think that quiet negotiations have cleared the road to approval both at the State level and in the County Council. We urge you to write to the Montgomery County House delegation and ask them to send the bill back to the County for public discussion, delaying any state action until County residents and taxpayers have had an opportunity to study and discuss the bill. Legislator email addresses are below.
The proposed Independent Transit Authority is somewhat akin to setting up another WSSC, run by a compensated board and self funded. Instead of "rates," the ITA would be funded by an extra fee on your property tax collected from "special tax areas," which could encompass the whole county, areas along particular transit routes, or whatever parameter the authority chooses. That extra property tax fee would not be subject to the County Charter limit that restricts property tax increases and puts a ceiling on the total amount of property taxes collected by the County. This charter limit was approved by the County residents in 1990.
Right now, as part of our property tax and under the charter limit, we pay a $0.04 per $100 assessed value "mass transit tax." That is not enough to fund the additional public transit projects proposed to reduce congestion in the County. The ITA, as described in the bill, could fund BRT, light rail, bridges, tunnels, property acquisition, parking lots, and garages, and even acquire property by condemnation, and probably even take on the debt on the Silver Spring Transit Center . But it won't have to present a budget to the Council every year like WSSC does.
The ITA, according to the legislation, could also issue bonds and incur debt that will not affect the County's debt ceiling or bond rating. In fact, the County could move debt off their books and onto the ITA's, and then increase spending and debt. The ITA debt will be guaranteed by future special taxes it can collect through the new separate tax on your property taxes. The County "may not require the ITA to submit capital or operating budget to County for approval."
If you think that MC 24-15 should be rejected by the Montgomery County delegation to the State legislature because it has not been properly introduced and discussed among the residents of Montgomery County, please write to the County’s state legislature delegates asking that they reject MC-24-15. Mr. Leggett can re-introduce the legislation next year.
As noted earlier, the Montgomery County delegation has agreed to hold a rare "late" bill public hearing in Rockville instead of Annapolis on Friday, January 30 at 6 pm. This does not substitute for internal public discourse between citizens and the County Executive . The presence of a significant crowd at the hearing would show our legislators that this is not the right way to do things. So please – come to the County Council Building, 100 Maryland Avenue in Rockville on Friday, January 30 at 6 pm.
Here is the voting list showing who in the Montgomery County Delegation voted to allow this bill to move through the legislature this session.
In a surprise move last, Thursday, County Executive Ike Leggett sent "late" bill MC 24-15 to our Montgomery County delegation in Annapolis asking for authority to create an Independent Transit Authority funded by a tax added to our property tax that is not subjected to current limits on that tax's increases. The bill is late because it was submitted seven weeks after county bills were due. Most County submitted bills are discussed in public hearings in Rockville in early December. The late submission means there was no public, transparent consideration of the bill – despite the fact that the consultant’s report that formed the basis of this bill was submitted to the County Executive more than one year ago, and was never presented to the Rapid Transit System steering committee.
This bill needs approval by the state legislature before the County can move on it. Late bills are considered on a fast track in Annapolis . The Montgomery County House delegation on Friday voted 19-4 to accept this legislation, and it may well be voted on by both houses before the scheduled April 13 adjournment. In response to a flood of protests from civic activists, legislators have agreed to hold a required hearing in Rockville instead of Annapolis on Friday, January 30, at 6pm.
If passed, this bill will allow the County to create an Independent Transit Authority (ITA). The County needs State authority to create such an agency. Concern among budget and legislation watchers is that there was a lack of transparency leading up to the submission of this bill and no public discussion, yet it gives authority to a new independent agency – and gives the agency authority to circumvent the County Charter 's limit on property tax increases.
Whether an Independent Transit Authority is a good idea or not, the details and impacts of this legislation need to be publicly debated and discussed before it goes to Annapolis for approval. The stealth with which this bill was developed and submitted lead many to think that quiet negotiations have cleared the road to approval both at the State level and in the County Council. We urge you to write to the Montgomery County House delegation and ask them to send the bill back to the County for public discussion, delaying any state action until County residents and taxpayers have had an opportunity to study and discuss the bill. Legislator email addresses are below.
The proposed Independent Transit Authority is somewhat akin to setting up another WSSC, run by a compensated board and self funded. Instead of "rates," the ITA would be funded by an extra fee on your property tax collected from "special tax areas," which could encompass the whole county, areas along particular transit routes, or whatever parameter the authority chooses. That extra property tax fee would not be subject to the County Charter limit that restricts property tax increases and puts a ceiling on the total amount of property taxes collected by the County. This charter limit was approved by the County residents in 1990.
Right now, as part of our property tax and under the charter limit, we pay a $0.04 per $100 assessed value "mass transit tax." That is not enough to fund the additional public transit projects proposed to reduce congestion in the County. The ITA, as described in the bill, could fund BRT, light rail, bridges, tunnels, property acquisition, parking lots, and garages, and even acquire property by condemnation, and probably even take on the debt on the Silver Spring Transit Center . But it won't have to present a budget to the Council every year like WSSC does.
The ITA, according to the legislation, could also issue bonds and incur debt that will not affect the County's debt ceiling or bond rating. In fact, the County could move debt off their books and onto the ITA's, and then increase spending and debt. The ITA debt will be guaranteed by future special taxes it can collect through the new separate tax on your property taxes. The County "may not require the ITA to submit capital or operating budget to County for approval."
If you think that MC 24-15 should be rejected by the Montgomery County delegation to the State legislature because it has not been properly introduced and discussed among the residents of Montgomery County, please write to the County’s state legislature delegates asking that they reject MC-24-15. Mr. Leggett can re-introduce the legislation next year.
As noted earlier, the Montgomery County delegation has agreed to hold a rare "late" bill public hearing in Rockville instead of Annapolis on Friday, January 30 at 6 pm. This does not substitute for internal public discourse between citizens and the County Executive . The presence of a significant crowd at the hearing would show our legislators that this is not the right way to do things. So please – come to the County Council Building, 100 Maryland Avenue in Rockville on Friday, January 30 at 6 pm.
Here is the voting list showing who in the Montgomery County Delegation voted to allow this bill to move through the legislature this session.
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