Is Allegheny County’s $16 million balance in an account to help Port Authority a rainy-day fund for unexpected emergencies or an opportunity to provide major transportation improvements?
Officials will be debating that question soon.
Allegheny County established a 10 percent drink tax and $2-a-day car rental tax in 2007 to provide its required share of funding for the Port Authority, generally about $29 million a year. When the taxes generated more than expected, Allegheny County Council reduced the drink tax to 7 percent in 2010.
Still, the fund collects substantially more than the required Port Authority subsidy. As a result, the fund ended 2015 with a balance of $16 million, according to Controller Chelsa Wagner’s annual comprehensive financial report released this week.
In Ms. Wagner’s opinion, the fund is “a big savings account with no clear plans for the future.” By law, the money is limited to Port Authority activities, but she said Thursday the county could be using it to plan for major improvements such as extending light rail service to Oakland or North Side neighborhoods instead of just saving it.
(Click image for larger version)
County Executive Rich Fitzgerald wasn’t available, but his director of budget and finance said the money is needed as a hedge against future increases in the county subsidy, and his director of communication called it “an appropriate amount” given upcoming capital projects.
In 2015, Ms. Wagner said, the taxes generated $46.4 million, a $3.9 million increase over 2014. Once all Port Authority expenses were paid, the fund’s balance increased by about $2 million at the end of the year, to $16 million.
“It’s difficult for me to look at a fund that’s healthy like that and have it just sitting there when it can be used for some of the severe and pressing needs we have for transportation improvements,” said Ms. Wagner, a former state legislator who served on the House Transportation Committee.
“I really see this fund as a unique opportunity to have some serious discussions about the future of transportation in this area.”
Last year, the county used $1 million from the Port Authority tax funds to pay for a study of the proposed Bus Rapid Transit system from Downtown to Oakland via the Uptown neighborhood. Ms. Wagner said she doesn’t see the benefits of that system since the Martin Luther King Jr. East Busway serves a similar purpose for eastern neighborhoods.
Ms. Wagner said she would prefer extending T service to east or North Shore neighborhoods, which would benefit bars and restaurants that collect the drink tax, she said. The rapid expansion in this area of ride-sharing services Uber and Lyft shows the shortcomings of the transit system, she said.
Ms. Wagner said she will make her pitch for using the excess transportation money to plan other transit improvements when she meets with Mr. Fitzgerald next week.
Mary Soroka, the county’s director of budget and finance, said for 2016 the transit fund will give the Port Authority $30.2 million for its operating subsidy and $8.5 million for capital expenses.
“My challenge here is to balance the anticipated costs now with the future needs of the Port Authority, which are increasing,” she said. “We need to have some money set aside if their operating needs increase.”
Amie Downs, the county’s director of communication, stressed the county doesn’t consider the $16 million a “surplus.”
“With the number of capital projects in the pipeline, and increased match requirement, it’s an appropriate amount.” she said.
Ed Blazina: eblazina@post-gazette.com or 412-263-1470.
First Published: May 13, 2016, 4:00 a.m.
