Why did such a large diverse group of Transit Supporters show up at the November 18 Kansas City Transportation & Infrastructure Committee meeting to support Ordinance 100951 to restore funding to transit?

City Government has been diverting an excessive and increasing amount of money from the ½ cent Transportation Fund to non-transit uses.

• This is crippling transit. In 2009 KCATA reduced service by 9.5% and increased fares 20% in order to sustain an even lower level of service.
• (Click on pie chart to enlarge.)

• 

  The city has gone from diverting less than 5% in FY2003/2004 to over 18% in FY2010/2011

Transit Supporters are aware of the budget pressures caused by the recession. The city has made a lot of very difficult decisions. But adequate transit is a basic city service that should be protected as a city priority. The proposed ordinance would reaffirm the city’s commitment to provide reasonable transit service to the community.

• This is an issue of fairness, social equity, and keeping faith with the voters.
• It honors the voter’s support for transit when they passed the supplemental 3/8 cent sales tax.
• Transit affects people’s ability to get and maintain jobs. The national organization, Transportation Equity Network (TEN) has a new report explaining how MORE TRANSIT=MORE JOBS. 65% of the trips on our public transit system are related to work or looking for work.
• In addition to jobs, transit provides vital connections to education, medical care, worship, shopping, entertainment and a vast array of personal activities.
• The significant cuts to transit service have unfairly affected the people who require transit, such as the elderly and the disabled.
• The ordinance confirms the City Council’s commitment to make Kansas City a “Green” and “Sustainable” place to live.
• However much the City needs additional funds in times of recession, the ½ cent transportation tax shouldn’t be raided to subsidize non-transit activities.

Why do we need Ordinance 100951?

• The pattern of shifting more and more money to non-transit uses is likely to continue without the ordinance.
• It is much too easy to just keep diverting money from this fund for other purposes. The city currently diverts over 18%. What is to keep them from going to 25% or 30%?
• Rather than using the 3/8 cent sales tax to improve transit as voters intended, the city is, in effect, using the 3/8 cent sales tax to replace the 1/2 cent sales tax.
• In the current budget the 3/8-cent sales tax is providing more money for transit than the ½ cent sales tax.

Kansas City Funding for Public Transit during the recession

• One third of the  $9 million decrease in transit funding over the last two years is a result of the city siphoning off additional money to non-transit uses. The remainder is due to lower collection rates during the recession.
• The City is unlikely to help transit from other city revenue sources, so we need to make sure transit gets most of this sales tax revenue.

What does the proposed ordinance actually do?

• The ordinance directs the budget office on how to allocate proceeds of the ½ cent transportation tax. (See footnotes)
• There will be no change in the amount of the money available for the budget, just clear direction from the City Council that certain funds be used for transit.
• Non-transit activities will revert to receiving 5% of the funding like they did when voters overwhelmingly voted for expanded and improved transit in 2003. The remainder will again go to transit.

Will this proposed ordinance cure the financial woes of the KCATA?

• This ordinance will not totally mend all the financial woes of the KCATA since sales tax receipts are still low.
• Without this ordinance, Mark Huffer, General Manager of KCATA, pointed out that service cuts of 25%-35% are looming as early as 2014, when the KCATA Reserve Fund would be exhausted.

Is there opposition to the Ordinance?

• Some concerns have been expressed about losing “flexibility” in the budgeting process. However, considering that the transit system suffered a tremendous financial reduction from the decline in sales tax, maintaining the City’s ability to continue diverting huge amounts of money away from the transit system shouldn’t be called “flexibility”.
• There is some concern about how to replace the money for non-transit activities that would return to transit. The non-transit activities could return to previous funding methods before the 1/2 cent transportation fund was used so heavily to subsidize their activities.

What can we do?

• At the next Transportation and Infrastructure Committee meeting on December 16, the committee will make a recommendation on the ordinance to the full council. Please contact your city council members and the mayor to support Ordinance 100951 and restore funding to the transit system.
• Contact information can be found here.

o   http://kcmo.org/CKCMO/CityOfficials/index.htm

Footnotes:

How will the ordinance be calculated?

• The proposed ordinance will create a new calculation. Both TIF (Tax Incremental Financing) and city administration fees are deducted first. These currently total about 15% of this sales tax. The 95%Transit/5% Public Works split will happen after TIF and the city administration fees are deducted.

How did TAN get all of this budget information?

• The Kansas City Budget is online. Choose the appropriate budget from the box in the upper right corner on this link.  Next click on any of the icons that appear. Then open or download the PDF file. It is over 500 pages long. From the FY 2010-1011 Adopted Budget TAN mainly used the Budget by Department and the Schedules.

o   http://www.kcmo.org/CKCMO/Depts/CityManagersOffice/Office%20of%20Management%20and%20Budget/index.htm

Related articles can be found on this blog by using Category “Action” or tag “KC Ordinance”

A decision on transit Ordinance 100951 will not happen tomorrow, December 9, 2010. Councilman Riley, Chair of the Transportation and Infrastructure Committee, intends to hold the ordinance, which restores funding to transit from the ½ cent sales transportation tax, to allow staff additional time to provide a plan to the Council.

We have been told that staff will provide a plan addressing the budget implications if the ordinance passes on the non-transit activities that are currently using that money.

Of course passing the ordinance would start to address the huge shortfall in the public transit budget.

The next discussion of the ordinance is planned for Jan. 6, 2011. The Council will not meet for two weeks over the holidays. On Jan 6th staff will present information concerning the budget.

We are pursuing permission to provide additional public testimony on Jan 6.