Photo by thisisbossi on Flickr.
Because the Congressional “supercommittee” failed to agree on a deficit reduction plan, WMATA is likely to lose about $12 million from the federal government in 2013. This could spell trouble for an agency that has already had to raise fares to keep up with its significant capital needs.
Under the terms of the Budget Control Act of 2011, without a supercommittee deal, nearly every item in the federal budget will suffer a 10% “sequestration” effective January 1.
Most of the nation’s transit systems will be protected from this cut because they get formula grants from the Highway Trust Fund (HTF), which is immune from sequestration. WMATA, however (like Amtrak), receives a direct annual appropriation from general taxpayer funds, $150 million a year for 10 years to make needed repairs that was part of 2008’s Passenger Rail Investment and Improvement Act, or PRIIA.
WMATA got that $150 million in fiscal 2012 (which ends September 30). A continuing resolution approved last week will continue this funding level through at least March 31, 2013. But after that, sequestration would take hold.
The HTF gets most of its money from gasoline taxes. Thanks to Congress’s refusal to raise the gas tax, even to keep up with inflation, there hasn’t been enough money in the fund to meet its obligations for the past several years. Thus, Congress has chosen to infuse general fund money into the HTF to keep it solvent.
These general fund infusions may be subject to sequestration, but none of the HTF’s obligations to the states and transit agencies will be reduced. The most likely result is that Congress will have to infuse more general fund money into the HTF sooner. The White House Office of Management and Budget (OMB) will have some leeway in applying the sequestration within each federal department and agency.
The WMATA cut is not the only way sequestration could hurt our region. If OMB chooses to apply the cuts retroactively to TIGER grants that the US Department of Transportation has already awarded, this would delay the completion of TIGER-funded projects like bus priority improvements and completing the Anacostia Trail.
Another possible victim is the Silver Line, much of whose funding comes from the Federal Transit Administration’s New Starts program, which is not funded by the HTF. Many other capital projects in the region, including the Purple Line light-rail corridor, have yet to receive federal funding, and any reduction in the amount of money available for grants would put them even farther back in line.
The only alternative to sequestration is another grand debt-reduction deal from Congress. But such a deal could hurt some programs more than sequestration would, in order to preserve others. Even transit-friendly members of Congress from Maryland and Virginia may vote to axe Metro in the end if it means preserving other pots, such as Pentagon spending, that provide huge sources of employment for their constituents.
While members of Congress are campaigning in their districts throughout October, consider taking an opportunity to remind them how important investments in infrastructure that reduces traffic congestion and enhances mobility in a sustainable manner are to you and to the region’s economy.
You can also make the point that we could avoid this whole sequestration mess altogether if they could muster the gumption to raise taxes on the wealthiest Americans, place a small tax on financial transactions, or finally raise the gas tax.
Besides, deficit spending really isn’t a bad thing, especially with the economy in recession.