Transit agencies across the U.S. were hoping the $14 billion bailout for the U.S. automakers would pass, but at press time the measure was rejected by the Senate.
The bailout plan included a provision to keep the nation’s rail and bus systems from financial panic. The legislation would have provided federal guarantees for complex financial transactions between major transit agencies and investors. Because of the credit crisis, many of these deals are in danger of defaulting.
With the collapse of the American International Group (AIG), Washington, D.C.’s Metro transit system was in danger of facing up to $400 million in payments. In November, leaders from the transit agencies warned that 31 of the nation’s largest transit systems could face at least $2 billion in payments in the coming months.
The IRS is urging the struggling banks to make a move, offering amnesty to any company that gives up its tax shelters by the end of the year. Tax shelters are a common practice among financial institutions and transit agencies.
Rail and bus services could face a crippling end result without federal backup, but the support from Congress was not there when the auto bailout was making its way through the Senate.
Senate Finance Committee Chairman Max Baucus (D-Mont.) was perhaps the most vocal dissenter of the measure.
“This provision aimed at protecting transit agencies really just helps the banks that entered into these sham transactions in their attempts to avoid taxes,” he told the Associated Press.
The transactions, called sale-in/lease out (SILO) and lease-in/lease out (LILO), involve the transit agencies selling rail cars and other equipment to banks and then leasing them back at a discount. The transit agencies receive large infusions of capital for investment while the banks could write off taxes of the depreciating property (tax shelters).
Back in 2004, both Baucus and Sen. Charles Grassley (R-Iowa) led a move that denied the deduction of losses from these transactions, ending the tax benefits of SILO transactions.
Three months ago House Transportation Committee leaders, including chairman Jim Oberstar (D-Minn.), pleaded with the administration to assist transit agencies that were caught up in bad deals.
“These transit contracts, when in vogue, were touted as an inventive way to allow public transportation agencies to fund their payment obligations for rail and bus equipment purchases,” said the letter signed by Oberstar and others. “They could threaten their very existence and the financial stability of the state and local governments that fund them.”
N.C. looks into taxing drivers by the mile
Call it a copilot to Oregon’s pilot. The state of Oregon made news last year with the announcement of its road-use tax experiment, which would charge motorists by the mile.
North Carolina is thinking of implementing something similar in response to less gas receipts. In December the U.S. DOT reported that Americans drove 100 billion fewer miles between November 2007 and October 2008—the largest continuous decline of its kind in history.
In North Carolina, revenue from the motor fuel tax of 29.9 cents per gallon was down 12% in 2008, and the state was expecting a three-year loss of $580 million, according to the Charlotte Observer.
“The status quo isn’t an option,” Mark Finlayson, a co-chairman of the transportation advocacy group N.C. Go!, told the Observer. “Cars are now using less fuel, but they are still putting wear and tear on the roads.”
If implemented, North Carolina’s road-user tax would be simple: The state would read odometers annually and tax motorists based on the number of miles driven. Future charges could be made based on when people drive in an effort to reduce congestion.
Studies are already being done in North Carolina. The University of Iowa is doing one covering six metropolitan areas using computers in cars. The amount of miles driven is uploaded to a central database.
Motorists would be billed and the money would then be distributed to the states where the travel took place. For example, if someone drove 200 miles in North Carolina then the NCDOT would receive payment.
Small group in Ariz. questioning effectiveness of speed cameras
Speed-camera enforcement is being tested in the state of Arizona, where a group has announced its intention to put a measure on the state’s 2010 ballot that would ban speeding tickets issued by photo enforcement cameras unless the driver is caught exceeding the speed limit by 20 mph or more. Current law takes pictures of drivers if their car is 10 mph over the posted speed limit.
Dane Platt and William Knowles are working to gather the 153,365 voter signatures necessary to place the measure on the ballot.
“We decided we did not like the cameras on the [U.S.] 60 and we didn’t feel it served the purpose of making the streets safer,” Platt told the Arizona Republic. “We figured it was just a revenue source for the state.”
The measure would apply to all photo enforcement in the state and effect Arizona’s recent enactment of speed cameras on state highways.
Speed cameras in work zones are being scrutinized in Illinois. The Chicago Tribune revealed that a majority of the speeding tickets issued by cameras are being dismissed in Cook County court. Cook County prosecutors blamed poor photo quality as the reason many of the cases were dismissed—nearly 500 through Sept. 9. Of the cases that were not dismissed, fines were drastically reduced.
“We need to work with the judges, prosecutors and the state police to improve the program,” Priscilla Tobias, a safety engineer with the Illinois Department of Transportation, told the Tribune.
Penalties will catch up to Fla. drivers
Toll officials in central Florida are making up for lost time—six years to be exact. Florida law says a toll violation costs three points against a driver’s license. But between 2002 and 2008, those points were not being deducted, affecting 23,000 drivers.
“There was an error. We corrected it,” said Ann Nucatola of the Florida Department of Highway Safety.
Officials plan to address the penalties retroactively. According to the Department of Motor Vehicles, once points are on a driver’s license they cannot be removed.
The Highway Safety Department has not said whether it will try to help the drivers and still allow them to go to traffic school to remove the points from their licenses.
Using cell phones quadruples the risk
Using a cell phone while driving greatly increases the chance of an accident, whether or not the driver is using a hands-free device.
The AAA Foundation for Traffic Safety released a report that using a cell phone quadruples the risk of getting in a crash. However, the study revealed that two-thirds of Americans believe it is safer to talk on the phone while driving if they are using a hands-free device.
The report also revealed that cell-phone use delays driver reactions to critical road events by an average of 0.23 seconds, and that half of the respondents to the study admit to using cell phones while driving.
Amber alert suffers complications in Vt.
The Amber alert system has yet to take off in the state of Vermont. Not that officials haven’t tried.
Vermont issued its first alert this past summer when Brooke Bennett was reported missing. However, miscommunication tainted the process and the Vermont Agency of Transportation was never notified.
A test was executed in early December to make sure all systems were a go, but technical issues again came to the surface, as some agencies did not receive e-mail alerts. State officials, however, are confident with their system.
“We have tools that can be an aid to the public and to state police,” John Zicconi, spokesman for the Agency, told FOX News 44. “We have since met and put a protocol in place so that an oversight like [the one during the summer] will not happen again.”
The Vermont Agency of Transportation notifies the public during an alert by using electronic highway signs and sending information to the 5-1-1 traveler information network.
The Vermont State Lottery also receives the information and prints it out on lottery tickets and displays it on signs.
The Vermont State Police was expected to do another full-scale test sometime before Christmas.
SIDEBAR
Agreement should free up traffic and increase safety on I-95
Deploying cutting-edge technology to relieve congestion and improve safety on the I-95 corridor from Maine to Florida has taken a large step forward thanks to an agreement signed in December by the U.S. DOT and the I-95 Corridor Coalition.
The agreement commits the Coalition to evaluate innovative approaches for project delivery and educate states on the use of alternative project delivery, finance and operation mechanisms. The agreement also calls for a vision of doubling the fuel efficiency of the region’s vehicle fleet and diversifying fuel use, and supports a seamless integrated multimodal passenger and freight network to link the major metropolitan regions along I-95.
“We are using a comprehensive approach across state boundaries to bring real-time traffic information, expedited incident clearance procedures and integrated intercity transit service that will reduce congestion and improve mobility along this critical corridor,” said FHWA Administrator Tom Madison.
The Coalition projects that by 2040 there will be a 70% increase in the amount of travel along I-95. Congestion will be up 84%, fuel consumption will increase 34% and the amount of trucking will double.
Madison explained that among the many strategies necessary to achieve the goals in the agreement, the communities along the corridor should strive to double the current vehicle fuel efficiency and increase the use of alternative fuels.
“We know America’s transportation system can be better, and today’s signing makes an ambitious, forward-leaning plan to reduce congestion along I-95 one step closer to reality,” said Madison.
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