Port Authority could get $3 million, RAD chief says
Even if Port Authority gets a 10-year funding agreement from the Allegheny Regional Asset District, the agency’s financial picture would remain uncertain.
And it could muddy the outlook for dozens of organizations that receive RAD sales tax money.
“I can say that right now we have enough money to provide $3 million to Port Authority without affecting any of our other assets,” RAD board President Daniel J. Griffin said on Thursday after a 90-minute hearing on Port Authority’s unprecedented request for money.
The district, funded by part of the extra 1 percent sales tax collected in Allegheny County, has a projected $5 million surplus.
“I can’t say for sure what the situation will be in three, four or five years,” Griffin said.
Port Authority CEO Steve Bland and Jennifer Liptak, chief of staff for County Executive Rich Fitzgerald, told board members that the RAD funding and an added $1.5 million from the county’s drink tax are needed to leverage $30 million more in state funding. That, combined with an agreement for $25 million in annual worker concessions and $6 million from fare increases, will prevent huge service cuts and layoffs through June, they said.
After that, the picture is murky.
Port Authority’s application asks for one year of RAD funding, although Fitzgerald asked for $3 million per year for 10 years in his written statement to the board.
Board member Stanley J. Parker, appointed to the board by Pittsburgh Mayor Luke Ravenstahl, said, “I have concerns about binding future boards to a long-term agreement.”
Griffin, a Fitzgerald appointee, said the board would consider Fitzgerald’s request as part of the application, noting even recipients with multiple-year agreements still appear before the board each year in RAD’s budget process — usually to ask for more money than they got in the previous year. Those groups are guaranteed a minimum amount through their agreements with RAD.
Board members also expressed concern about other funding sources in the fluid deal to save Port Authority, as well as the impact that might have on other RAD recipients.
None of the presenters for other organizations who testified at the funding hearing mentioned concerns about Port Authority’s siphoning grant money. In contrast to the lengthy hearing for Port Authority, the other groups — such as The Pittsburgh Philharmonic and the Pittsburgh Parks Conservancy — had three minutes to make their cases for funding.
After the meeting, Diane Unkovic of the North Hills Arts Center in Ross said she does not like the idea of RAD’s bailing out the transit agency.
“But I’d rather bail them out than see one person lose their job, and if it lets people who need public transportation participate in the arts, then I can see the relevance,” said Unkovic, whose group has received the minimum $2,250 grant in recent years but is seeking $6,000 next year so it can get electric pottery wheels.
Former RAD board member Rick Pierchalski this week predicted that funding Port Authority would deplete RAD’s reserves. This year’s surplus is not the norm.
Pierchalski said the group doled out more money than it gained in eight of the past 14 years.
If sales tax revenue is down and reserves are depleted, Pierchalski said, “everyone will be affected. The low-hanging fruit — the small assets that have no political drag — will go first.”
Griffin said RAD has $18 million in its reserve account and historically has not let it dip below 15 percent of expenses. It handed out $84.1 million this year and has $101 million in funding requests for 2013, including Port Authority’s.
Liptak said there has been substantial growth in sales tax revenue in recent years and predicted it would continue.
County manager William McKain said the county expects the drink tax to generate an added $1.5 million this fiscal year, but he cannot predict how it will perform in coming years. The county does not have much wiggle room: McKain said it has reserves of just $5.7 million in its $784 million operating budget.
It also remains unknown how much added funding Port Authority will receive from the state in coming years.
Bland said he expects Gov. Tom Corbett and state legislators to consider a long-term transportation funding package that could include an annual increase in funding similar to what is being promised through June.
Tom Fontaine is a staff writer for Trib Total Media. He can be reachedat 412-320-7847 [email protected].