Published June 15, 2008

Transit woes put sales tax in a crossfire
With angry riders, broken promises and funding problems, Miami-Dade Transit is at a crossroads -- and county commissioners will help chart its course this week.
BY LARRY LEBOWITZ

The chairman of the Miami-Dade County Commission wants to double the 5-year-old sales tax for transit.

A multi-millionaire civic leader wants to repeal it.

Another commissioner wants to start a round of fare increases to feed a troubled system of buses and trains that federal regulators say is on track to rack up a billion-dollar shortfall over the next 30 years.

And what about riders -- who have seen most of the big promises of the 2002 transit-tax campaign go unfulfilled?

"I'm fed up -- and I ride the system every day," said Barbara Walters, a transportation advocate and former county elections employee. "I supported the tax. I probably would consider repealing it, if somebody put it on the ballot. They've made such a mess."

Miami-Dade Transit is at a crossroads. Promised Metrorail expansions aren't going to happen, bus service is being cut back -- and current revenues aren't enough to cover everyday operations and the rising cost of diesel.

On Tuesday, commissioners will begin deciding which paths to take. Here's a closer look at their options.

ROUTINE EXPENSES

Despite campaign promises that the 2002 transit tax would generate "New Money for New Projects," a Miami Herald report last week showed how county leaders have spent more than half of the $800 million it has generated on routine operations.

Decades of operating deficits and inadequate funding for long-term maintenance at Miami-Dade Transit have prompted federal regulators to say they will not provide matching funds to build new Metrorail lines until the county gets its financial house in order.

That imperils the future of the long-promised Metrorail North Corridor along Northwest 27th Avenue, and another line from Miami International Airport to the western suburbs.

Amid all the turmoil, Commission Chairman Bruno Barreiro wants to ask voters to double the 0.5 percent sales tax for transit. In return, Barreiro wants to eliminate all fares on trains and buses.

"What you're seeing now is what I predicted back [in 2002], that a half penny wasn't going to be enough," Barreiro said. "I want to have the problem of too many riders. And I think with another half-penny we can build Metrorail a mile at a time if we have to, on our terms, and forget about the feds."

The transit agency, backed by Mayor Carlos Alvarez's administration, says the fare-free system won't work.

No major American transit agency has been able to make a no-fare system work.

Denver and Austin are the last two that tried. Both killed it in less than a year. San Francisco Mayor Gavin Newsom pushed fare-free transit in 2007, but quickly backed away after he saw the numbers.

Barreiro doesn't appear to have enough support among commissioners to even get the idea onto the November ballot.

"There's no way this works -- especially now," Commissioner Carlos Gimenez said. "Let's assume, for the sake of argument, we're still in a good economy. Even if you assume that, how do we ask the voters for another half penny when we haven't delivered on the promises we made them with the first one?"

TAX REPEAL

At the other end of the spectrum, sentiment is gathering for a repeal of the transit tax.

"It's outrageous. Absolutely outrageous," said auto dealer Norman Braman, a frequent critic of government spending abuses. "How out of touch can they possibly be? How can they think that anyone is going to support another tax when they've totally squandered the first half penny? Eight hundred million for nothing!"

Braman, who famously helped defeat a 1999 sales tax proposal that would have raised money for transit and other purposes, said it's probably too late to gather enough signatures to put a repeal measure on this fall's ballot.

But he said he's asking his lawyers to consider ways to fashion a tax repeal ballot question in 2010 that could also create a "truly politically independent" countywide authority to oversee the transit agency.

"I submit that it's time that we started taking major expenditures away from our elected officials," Braman said. "Our current county mayor, manager and all of his assistants, and even some commissioners appear not to be up to this task."

County leaders say any talk of repealing the tax could have catastrophic consequences on the transit system and would scuttle for another generation any chance of expanding the bus and rail system as promised in 2002.

Repealing the tax would create havoc not only with the transit agency's daily operations, but with Miami-Dade's credibility on Wall Street. The county has sold several bonds and taken out loans backed with sales-tax revenue. It would have to find other revenues to keep those commitments to the buyers. Next year, the county will be paying more than $52 million on those bonds and loans.

Many of the transit agency's problems took root before Alvarez was elected in November 2004. But Alvarez, who received broad powers over county government by a special referendum in 2006, acknowledged in an interview that he took too long to confront the crisis.

The mayor said he should have told the public there wasn't enough money to deliver all that was promised sooner. The county, he said, needs to "right-size" the transit agency and create a clear list of priorities so voters can see what can -- and can't -- be delivered.

"We should have moved faster on this," Alvarez said.

Alvarez said he doesn't believe Barreiro's plan for doubling the transit tax will garner any support. He favors Commissioner Barbara Jordan's plan to increase fares to bolster the transit agency's flagging finances.

FARE INCREASES

Under Jordan's plan, endorsed by the commission's Transit Committee, a regular bus or train ride would increase from $1.50 to $2. Monthly passes would rise from $75 to $100. The increases would generate about $23 million in new revenue next year.

Transit desperately needs the cash. Despite the half-cent sales tax, the agency's operating revenues have eroded, in part because commissioners have been unwilling to vote for fare increases that keep up with inflation.

Jordan's plan would depoliticize future fare increases. They would be adjusted every three years, based on a formula that weighs the transit agency's operating costs.

Tuesday's vote is expected to be close.

"I don't know if we're going to have the votes for the 50 cents at this point," Jordan said last week. "All I know is we can't afford to do nothing."

She admits there's no guarantee that the fare hikes will persuade federal regulators to restore Miami-Dade's eligibility for federal funds -- a key prerequisite for building Metrorail's North Corridor, which would run through Jordan's district.

But the increases "will be addressing the deficit that exists in transit regardless," Jordan said.

Six commissioners appear to oppose raising fares -- Barreiro, Gimenez, Jose "Pepe" Diaz, Joe Martinez, Rebeca Sosa and Javier Souto.

Six commissioners are leaning toward supporting the increases -- Jordan, Audrey Edmonson, Sally Heyman, Dennis Moss, Dorrin Rolle and Katy Sorensen.

Commissioner Natacha Seijas holds the swing vote. She said late last week she still wasn't sure which side she supports.

Commissioner Diaz said his office has been flooded with calls urging him to vote against both the fare increase and Barreiro's call for a sales tax increase.

"People are mad. They have reason to be mad," Diaz said. "This is messed up. Totally messed up."

CHANGES

Some reforms are already under way.

The Alvarez administration is looking to cap some of the public works spending that has been done with sales tax proceeds. The cap would limit such neighborhood improvement and public works spending at $469 million -- meaning $400 million more in planned projects would be pushed to the back burner.

A long-overdue project to synchronize traffic signals will continue. It's cost: more than $120 million -- $49 million of it coming from the sales tax. But an array of other big-ticket items -- reversible flow lanes on major arteries and flyover intersections -- will be pushed back a decade or more.

Beyond the tax-and-spend issues, at least one commissioner says he wants to restore the independent accountability into the system.

Commissioner Gimenez is reintroducing legislation that commissioners have rejected in the past: He wants to expand the powers of a citizens' watchdog panel that voters were promised in the 2002 campaign for the sales tax increase.

The Miami Herald's report last week showed how that panel, the Citizens Independent Transportation Trust, was hobbled from the start by the enabling legislation that commissioners adopted.

As a result, the trust cannot hire or fire its own staff or attorneys. It cannot approve or reject contracts until they have been first approved by commissioners.

Trust member Jorge Cueto, a prosecutor from Country Walk, isn't holding his breath. He doesn't expect commissioners will relinquish power to the CITT.

"Why should I?"' he said. "The history here says I shouldn't."