RTD officials offered a gloomy 2009 financial forecast to agency directors Tuesday night, one that has sales tax receipts declining even more than predicted unless there is an economic turnaround.
The Regional Transportation District relies on a 1 percent sales and use tax in the eight-county metro area to fund the bulk of its existing transit system and for the planned FasTracks transit expansion.
RTD Chief Financial Officer Terry Howerter said the sales and use tax decline of 14.6 percent for the first two months of this year when compared with Jan./Feb. 2008 suggests that RTD tax collections for all of 2009 could be down 6.9 percent from 2008.
Such a steep decline would likely affect RTD’s operating system and possibly add to the $2.2 billion deficit the agency has identified for building all of FasTracks by the planned 2017 completion date. To close the deficit, RTD is considering a proposal to double the current 0.4 percent tax that goes for FasTracks.
RTD budget manager Robert Merriman told directors that state data shows sales and use taxes collected from new car dealers in metro Denver declined 27.8 percent in February from the same month a year earlier. Meanwhile, taxes collected from building materials dealers were down 39.1 percent anddown 21.5 percent at hotels and motels and 10.5 percent at full-service restaurants, Merriman said.
As RTD develops its five-year Transit Development Program (TDP) for the current system, financial constraints will crimp capital spending and could lead to more service cuts, General Manager Cal Marsella told directors.
“We’ve moved into a new era,” Marsella said. “The cyclical peaks and valleys are more of a sustained valley.”
“The theme of this TDP is austerity,” he said. “We don’t have a lot of room now for expansion.”
Also on Tuesday, RTD released data showing it has spent $316.7 million on FasTracks contracts so far, with about 20 percent of the work going to small- and disadvantaged business enterprises, so-called SBEs and DBEs.
In coming days, RTD’s board is expected to approve a construction contract for the West Corridor light-rail line totaling about $346 million. The West line to Lakewood and Golden is the first of six new FasTracks trains that are to be built.
Some limited construction on the West line has occurred, but finalizing the full contract is expected to trigger construction spending at a rate of about $10 million a month on the 12-mile line beginning this summer, RTD officials say.
Another West Corridor construction contract that is expected to soon get RTD board approval is a $65.3 million award to Balfour Beatty Rail Inc. for electrical systems work on the light-rail line.
The West train is due to start operating in May 2013.
Jeffrey Leib: 303-954-1645 or jleib@denverpost.com
