Case study Texas: How some states manage to rein in out-of-control transportation boondoggles
Image by Ewan Munro
Austin’s liberal establishment--just like Santa Clara County's--has been trying to trick taxpayers into pouring billions into their light rail boondoggle for decades, finally winning an apparent victory when voters approved a scheme in 2020. But it turns out that the terms of the ballot language may have doomed the project. BattleSwarm Blog reports.
Austin’s controversial light rail program, approved by voters in 2020, could be null and void due to an allegedly unconstitutional financing proposal.
According to press reports, during a court hearing, proponents of the transit scheme found themselves unable to defend the project’s ability to borrow money. Absent this authority, it is unlikely to continue.
At issue is the convoluted structure of the measure presented to voters in 2020. Designed to evade state limits on debt and borrowing (which seemed like a money laundering arrangement), the measure created a so-called “governmental corporation” called the Austin Transit Partnership. According to the 2020 proposal, the Austin Transit Partnership was supposed to be funded by a one-time increase to the city’s maintenance and operations property tax.
Combined with inflation, this has led to a situation where the Austin Transit Partnership now needs to borrow substantial sums.
Unfortunately for proponents, state law prohibits using maintenance and operations property tax dollars to pay debt for so-called ‘governmental corporations.’ While a second component of the property tax—interest and sinking—could be used to pay debt, that’s not what was approved in 2020.
It was obvious that the Project Connect light rail project was a boondoggle from the git-go, just as the previous light rail effort was a failure. The fact that more than three years on, Project Connect still doesn’t have a definite plan or path is a handy indication of its dysfunction. Hopefully Texas courts will put it out of Austin taxpayer’s misery.
Read the whole thing here.
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