A sorry story of transit and taxes: State legislators support the wealthy over the many who need mass transit
April 18, 2012 4:00 AM
By Natalia Rudiak
We are the wealthiest nation in the world. So why are we struggling to maintain basic public services?
It seems that Allegheny County's transit system is in crisis every year, but this year the crisis looks potentially terminal: Without adequate funding from our state government, Port Authority management says we will face further fare hikes and service cuts on the order of 35 percent. Entire towns and neighborhoods will be rendered inaccessible and off the map for countless local citizens.
A Port Authority after cuts that deep would barely merit the label of a public transit system. Despite this dire situation, too many of our elected officials at the state level are talking about this crisis as if it were a force of nature, instead of a problem made by people that can be corrected by people.
Our transit system has to "learn to live within its means," they say, while simultaneously reducing those means. The Port Authority has reduced service and reformed management and its workers have made concessions, but this has had no effect on the rhetoric -- and funding -- coming out of Harrisburg.
Just like the roads and bridges that connect our cities and towns, every transit system in the country is subsidized by public dollars. Privatization of metropolitan public transit is a popular idea lately, yet it has not succeeded in any part of the country, including Allegheny County. The reason? Similar to roads and bridges, mass transit is not a profitable enterprise. It requires public money to maintain and operate.
The Port Authority cut 29 routes last March, with only one -- the most lucrative -- picked up by a private operator. Residents along the other 28 routes, including my constituents, were stripped of their only way to get to work, school, stores and doctors. Many were stripped of their dignity and independence. We elect our representatives to protect our resources and freedoms, not take them away.
As a member of Pittsburgh City Council, I am used to hearing from the state and federal governments that they just don't have the money for what our city needs. But it doesn't have to be this way.
We live in an extraordinarily wealthy country that can afford the vital, world-class public services that have provided the foundation for our economic prosperity. Unfortunately, priorities have shifted. Many of our elected officials have decided that maintaining public services is not important and that our nation's wealth is best kept in a few hands.
Transportation funding is often portrayed as an urban vs. rural issue, with rural legislators complaining that they do not want to subsidize mass transit systems in cities. This dichotomy is false -- and not only because there are, in fact, public transit systems in rural areas and small towns, but also because urban taxpayers heavily subsidize road and bridge construction in rural areas with the taxes our large populations pay. We need to reinvigorate a sense of reciprocity and realize that we cannot achieve success in our state without investing in every corner of the commonwealth.
Another problem is that our entire tax system is set up to reward people who least need it, even as the rest of us see a steady decline in our standard of living and in the public services we have a right to expect. Transit is only one example; education is another.
A study by the Institute on Taxation and Economic Policy showed that in Pennsylvania if your family income was between $35,000 and $56,000 in 2007 (that is, if your income put you in the middle 20 percent), you typically paid over 9 percent of your income in state and local taxes. But if you were in the top 1 percent -- with a household income in 2007 of more than $428,000 -- you typically paid less than 4 percent of your income in state and local taxes after federal offsets.
This means that those who can afford to pay more are shirking their responsibility to the commonwealth and looking to working-class wage earners to pay for the rebuilding of our deteriorating roads, bridges and transit systems.
The same applies to corporate taxes.
Large employers in the Pittsburgh area, both for-profit and non-profit, need a functioning transit system to get their employees to work, and some of them have pleaded with the state Legislature to provide more funding for the Port Authority. But still we allow an accounting trick in Pennsylvania called the "Delaware Loophole" that allows most large corporations to avoid paying state corporate income taxes altogether. The Pennsylvania Budget and Policy Center estimates that this costs our state $500 million a year.
So here we have many of our large employers who know they rely on mass transit urging additional state funding to preserve it while they lobby to keep corporate taxes low and this unfair loophole in place. It is the rest of us who are expected to sacrifice.
The first under the knife will be Port Authority drivers and mechanics themselves, who work every day to provide an essential service to our region. In recent years, these workers have negotiated wage and benefit givebacks and $93 million of savings in legacy costs.
Port Authority finances would be adequate, save for one fact. State legislators have refused to establish a stable funding source for mass transit and have viciously cut funding to the Port Authority for years so they can protect the special tax status of corporations and wealthy individuals.
As someone elected by the public to serve the public, I know that democracy works. I know that if you want a vibrant economy and essential public services, you have every right to call your legislator and demand them. You have every right to show up at the Capitol, individually or in groups, and demand action.
It is our democracy, after all. It is long past time to take it back.