Sales tax slump hurting Metro Transit

A bigger-than-expected fare increase or cost-cutting are options being considered by King County officials to make up for a drop in tax revenue supporting Metro Transit.

A bigger-than-expected fare increase or cost-cutting are options being considered by King County officials to make up for a drop in tax revenue supporting Metro Transit.

A sharp drop in sales tax collections, the sagging local economy and high fuel costs are sparking a closer review of a 25-cent fare increase that County Executive Ron Sims proposed last month but now is in question in the face of a projected budget shortfall in the tens of millions of dollars.

Sales tax revenues are Metro’s main source of funding. Projections released at the end of July by county budget officials show Metro will lose $45 million in sales tax revenues in the 2008-09 biennium and $43.5 million annually beginning in 2010, which adds up to about 8.3 percent less revenue than anticipated. The loss, combined with a projected $22 million in unanticipated costs due to rising fuel prices and other cost increases, means Metro is facing an average annual budget shortage of more than $70 million.

In light of that forecast, Sims and County Concilman Dow Constantine, chairman of the council’s Transportation Committee, agree the council should take more time to analyze Sims’ proposed fare increase.

Constantine said that in addition to higher fares, ways “to keep the buses rolling” include cutting costs, postponing spending and maximizing “service efficiency.”