Thursday, December 18, 2008

Sales Tax Drop Means 'Tough' Times for UTA

With sales tax revenue running 18 percent below 2008 projections, Utah Transit Authority (UTA) General Manager John Inglish anticipates the next 18 months "will be tough" for his agency, the Deseret News reports. That's why earlier this week the agency's board of trustees adopted a $280 million budget for 2009, only $1.7 million more than the previous year.

The budget does not anticipate reducing service on any of the agency's commuter rail, light rail or bus lines, nor does it call for fare hikes. But it leaves little wiggle room. It anticipates sales tax revenue to decline by 1.5 percent despite a one-quarter of one percent hike in the tax rate. If collections fall below projections service reductions may be necessary. The sales tax generates approximately 17 percent of UTA's revenue, according to UTA spokeswoman Carrie Bohnsack-Ware.

UTA ridership was up 12.2 percent, year-over-year, in 2008, with 36.6 million riders. However, start-up of the FrontRunner commuter rail line in April contributed some of those gains.

The agency isn't the only major transit operating hurting financially because of lower sales tax revenue. MARTA, the transit agency in metropolitan Atlanta, is facing a $60 million budget shortfall due to a fall-off in sales tax income. The tax accounts for approximately half of its revenue.

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