Make an informed decision on Transit Reform
Before you cast your vote on April 21, take some time to inform your conscience based on careful analysis of the facts and data. Click here to find links to materials developed by Catholic Charities as well as links to other sites, both in support and against the tax. Also, find out how much your taxes will increase if the tax passes. 
 
 
Why us? Why now? Since taking a stand in support of the transit reform proposal on the April 21 ballot, we at Catholic Charities of the Diocese of Baton Rouge (CCDBR) have been asked repeatedly: Why? To many it seems out of character for our agency -- which is known for its acts of charity and service to the poor -- to take a stand on a public policy issue, especially one involving a tax. This is a fair question and should be answered.  Our position was developed after months of study and consideration by our committees and board.  It was not adopted lightly or without consideration of alternatives and objections. 
 
The reasons are primarily rooted in our faith; as an agency that serves the poor, we know that better transit system will be good for both individuals who can’t afford other choices and also for our community as a whole.   This is not to say that the position of CCDBR is the only viable Catholic or Christian position.  We recognize and respect that other conscientious and committed people of faith may study this issue and have valid reasons of opposition.  But when we examined those reasons, and gathered the facts and data, we still found sound justification based on our principles and mission to support the measure.    
 
As a matter of conscience, we may not agree, but as a matter of faithful citizenship, we should inform our conscience.  Public dollars underwrite all of our transportation networks.  When compared to the primary alternative, automobiles, data shows that investments in mass transit provide higher-waged jobs and more economic growth, relieve congestion, improve property values and enhance quality of life.   The evidence (presented below) indicates that the overall economic benefit to a community is greater than the cost of public transit.  A thriving mass transit system builds a thriving community to which everyone – young and old, rich and poor – can more fully contribute.  And most importantly, the greatest benefit is for the poor, those who our Gospel tradition calls us to serve more intentionally.

Following is an explanation of our position that will cover:
1. An examination of alternatives to the current CATS proposal.
2. Responses to important questions.
3. Our transit position as related to our mission.

In this paper, we have striven to provide thoughtful reflection based on facts, data and analysis.  In the end, there is room for differing opinions on several key questions, but we hope to sift through anecdote and hyperbole to help clarify the debate with facts and sound reasoning.  And as always, we invite those who may disagree to contact us.   
 
Click here to download a print version of this statement. The original statement can be found here.   
 

1.  Examination of Alternatives

The most common alternative solutions posed by others are that CATS should be privatized as LSU has done, the Metro Council should fully fund CATS, or the system should be abandoned.
 
Why doesn’t CATS privatize as LSU has done?  Using the LSU bus system as a model for the entire area’s transit needs is problematic.   As reported by The Advocate, LSU’s transportation costs increased when it dropped its contract with CATS, which is in line with peer city costs of $133/capita for transit systems and further supports that CATS is underfunded and.   LSU assess the cost of its transit system on every student, regardless of whether they ride the buses.  The current CATS budget is about $27 per capita for East Baton Rouge Parish residents.  The fee for the LSU system is $122 per student ($66/semester).  If we adopt the LSU model, would CATS -- or the Metro Council – then be empowered to assess a $122 fee per year on every resident of the city or parish?  This would raise $31 million annually if in the cities’ (Zachary, Baker, Baton Rouge) limits or $54 million if parish wide. Comparatively, the proposed 10.6 mil tax raises $18.4 million annually. The proposed new tax would cost about $71/resident of the three cities. 
 
 
Additionally, privatizing does not resolve the underlying problem of an underfunded transit system.   In cities where transit systems have been privatized, such as New Orleans, there is a dedicated source of public revenue that guarantees the private operator reliable funding.  If CATS were privatized, the questions would remain: How will CATS be financially supported?  Who will pay? 
 
Should the Metro Council fully fund CATS?   That would be more of the same, throwing money at a problem rather than true reform and it fails to secure a funding source for the additional dollars needed.  In the past, the Metro Council has only band-aided a crippled system.  Furthermore, accompanying its funding authority, the Metro Council has had authority over operational decisions, rejecting CATS proposals to reduce services and eliminate routes when faced with budget shortfalls, thus exacerbating the current budget crisis.  Under the reform proposal, the Council will surrender its veto authority over CATS operations.  A single entity would be responsible for the finances, operations, and governing of the system subject to board appointments from the Council.    
 
Why not shut down CATS and build a new system from scratch?  First, shutting down the system would deprive thousands of people of basic transportation.  Many businesses would find their operations hampered.  (Some employers report that up to 80% of their workers use public transit to get to work.)  Unemployment could increase. There also is a cost involved.  It costs money to shut down a business.  Start-up and capital costs would be an additional financial burden as they always exceed normal operations.  Such a course does not seem like a wise use of public money.  Furthermore, it simply does not solve the problems.  How would the new system be funded? Where would the money come from?  Which tax would be dedicated?  How would it be structured and governed?  Who would make these decisions?

2.  Responses to Important Questions

It seems better to build on what is already on hand and improve the current system rather than start over, especially given that the current system, despite its shortcomings, has some strengths, for example CATS is not as poorly run as many perceived.

Is CATS is poorly run, inefficient and undeserving of public support?    Some say that CATS has proven it should not be trusted with developing a better transit system. However, data indicates that CATS is an efficiently run system.  A peer-city analysis shows that in several variables -- cost per rider, per vehicle mile, per vehicle hour – CATS is as efficient if not more so than others.   Comparatively, CATS performs well with meager resources.  Its cost per unit of service averages 27% below the average of other southern cities while other cities are funded nearly 500% greater. 

 Funding/capita $/vehicle mile$/vehicle hour  $/passenger mile  $/passenger hour  Avg $/unit 
Southern Metro Average  $133 $7.37 $98.00 $0.89 $3.87 $27.53
Baton Rouge $27 $5.37 $77.56 $0.74 $3.22 $21.72

 (CPEX/BRAF)
 
Some point to sightings of empty busses as evidence that CATS is inefficient at the least, and not needed at the most.  This is an unfair analysis as there are also CATS buses that are full, primarily during rush-hour traffic.  And besides, most of our cars sit empty in our garages and parking lots for more hours in a day than they are used.   Most cars on the road have only one occupant. Does that mean they are unnecessary or that we should not improve our roadways?  
 
Will increased property taxes empty our city, drive people out of the parish and create economic hardship?  While some people may move for all sorts of reasons related to quality of life, not taxes alone.  In fact taxes seem to play a minor role; the fastest growing parishes in Louisiana – St. Tammany and Orleans -- have property taxes much higher than East Baton Rouge, 176% and 146% respectively.  Additionally, studies indicate that good transit systems improve property values, attract residents and create jobs.  Economic productivity increases because more people have access to jobs, training and education while employers have a larger labor market from which to select employees.  Transit is an economic engine that helps produce wealth.  While there are volumes of study on the economic benefits of transit, one in particular is useful.  Compared to alternative daily household expenses – especially automobiles where much of the economic benefit is overseas -- transit expenditures generate about twice the total economic growth in jobs and wages. 

The following table shows the results in terms of economic development, number of jobs created and wages from certain jobs for each $1 million spent on vehicle expenses and household goods vs. transit. 

Each $1Million Spent 

     Expense Category    

Economic

        Development      

        Wages                Jobs               Avg. Wage     

Total

     ED + Wages      

     ROI      
 Vehicle Expense $1,113,978 $ 558,260 13.3$42,133$1,672.23867%
 HH Goods & Vehicle Expense $1,278,440 $625,533 17.0$36,796$1,903,97390%
 Average of above $1,196,209 $591,897 15.1$39,464$1,788.10579%
 Public Transit $1,815,823 $1,591,993 31.3 $50,862 $3,407,816 241%
 
(IMPLAN modeling, 2008, Harry Chmelynski, Ph.D, Faucett Associates)
 
This research demonstrates:
  • Transit creates twice as many jobs as the average of the other categories.
  • Wages of the jobs created under transit are 130% of the average.
  • The total economic benefit of transit is twice that of the average.
  • The Return on Investment is three times as great with funds spent on transit.
Some extrapolation will show a sizeable transit advantage in total economic development, jobs and wages when comparing how the $18.4 million raised by the tax could be spent. The following table compares the economic impact of the $18.4 million spent directly on vehicle expenses vs. the $18.4 million as part of a transit system with a total budget of $30 million.  The economic impact of transit spending is more than three times greater even though the amount of expense is only 1.6 times as much ($30m vs. $18.4m).
 
    Economic Impact   

$18.4M*

         Vehicle Expense      

$30M CATS**

         Transit Expense          

     Transit Advantage     
 Economic Dev. & Wages $30,769,170 $102,234,480 332%
 Jobs 278 939 337%
 
*$18.4 million CATS tax          **$30 million is the total CATS budget built on the 18.4 million raised by the tax. 
 
 

And it should be noted, these categories do not include other businesses such as restaurants, entertainment, retail shopping as well as property values -- all of which grow along transit routes.  When communities spend less on transportation there is an additional economic benefit for these unrelated businesses because discretionary spending increases. Economic analyses have found that Colorado experienced 4% economic growth attributable to investments in transportation alone; Chicago 21%.  The benefits extend beyond direct economic growth.  The Texas Transportation Institute found that bus systems save communities $41 per capita annually in congestion costs. 

Research indicates rather overwhelmingly that increased public funding for mass transit will be a net economic gain -- rather than a drain -- for our community.

Did CATS “gerrymander” an unfair taxing district?  CATS did not create a taxing district of contorted lines to include favorable populations and exclude others.  As authorized under state statute, CATS has the authority to call for a tax either within municipal boundaries or parish boundaries, period.  It cannot draw new boundary lines.  The tax is proposed for the existing cities of Baker, Zachary and Baton Rouge.  These cities’ limits exist independently of CATS, and over 95% of CATS riders come from within them.  So, the tax asks those areas served by CATS and those residents who will have the ability to ride CATS to pay for CATS.   

Despite this, some complain of the opposite; that the metro areas will unfairly shoulder the financial burden for the transit system on behalf of the entire parish.   Let’s look at the numbers.  EBR Parish has a population of about 440,000.  The three metro areas in which 95% of the ridership resides comprise about 60% (270,000) of the EBR Parish population. Would it be fair to ask the additional 170,000 to support a transit system that does not service their communities?     

Another misstatement related to metropolitan boundaries is that even if a city defeats the tax but passes in Baton Rouge, everyone pays.  That’s not true.  The vote in each city is independent of the others.  The tax is reasonably proposed for the metropolitan areas.

Is this a hugely unfair tax increase of nearly 80% for homeowners?   The tax is reasonable, less than the millage for the EBR library (11.1) or BREC (14.46).  As for the percent increase, 79% is partially true.  Most will see an increase of about 17%.  Seventy-nine percent applies to homes valued at $50,000 -- $75,000.  The actual dollar amount is about $65 per year, a little more than a tank of gas.    In fact, those who would see this increase are precisely the ones who may benefit the most from a more efficient mode of transportation.  The question will be theirs to decide – How do I want to spend $65, on a tank of gas that lasts a week or to get a transit system available year round?   Below are two tables showing the impact of the tax on the average homeowner of each city as well as the impact on homes of various values.
 
    Revenue Amt.   

   Tax rate (Millage)  

   Avg HH cost/month    Avg. house value 
Baton Rouge  $16,663,200 10.6$14$157,100
Baker $636,000 10,6$10$110,074
Zachary $1,144,800 10.6$16$180,518
TOTAL $18,444,000   


       Value of Home         Cost per month    
 $50,000$4.42 
 $75,000 $6.63
 $100,000$8.83 
 $125,000$11.04 
 $150,000$13.25 
 $200,000$17.67 
 $300,000$26.50 

Will CATS be held accountable? One element of the reform proposal is that the Metro Council should remove itself from having veto authority over CATS board decisions regarding operations.  Critics complain that CATS will then lack oversight and accountability.  This criticism overlooks and confuses several factors:
  • The existing arrangement of dual responsibility is confusing, lacks clear lines of accountability, and is one of the causes of the current inadequate system.  When CATS has proposed solutions to budget shortfalls, the Metro Council has vetoed them, but the blame then falls on CATS.
  • CATS will remain a public body.  The Metro Council -- and all residents -- will continue to have full access to its finances, meetings, and input into decisions.
  • The Metro Council and the Mayor will continue to have CATS board appointment power .
  • The reform proposal establishes a process for community organizations to have direct input into the appointment process by nominating candidates.  This will create a more transparent process and directly increase the community’s ability to influence the composition of the CATS board.
  • The reform proposal also establishes criteria for CATS board membership to help assure that with increased funding and greater responsibility, the board is comprised of more qualified individuals with appropriate expertise.
We understand that some voters have good reason to prefer the Metro Council, comprised of elected officials, to continue to have operational authority over CATS.  However, we see that as more of the same and perpetuating a non-responsive system.  The reform proposal, as a comprehensive package, will build not only a solid financial foundation but a better governance structure. 
 
Did CATS unfairly eliminate the homestead exemption and target seniors? Opponents have even gone as far to say the tax “steals” the homestead exemption.  The fact is that under state law municipal taxes exclude the homestead and senior exemptions on property taxes.  CATS is simply complying with state law, not furtively avoiding legal obligations.  Likewise there is no targeting of seniors.  The existing “freeze” on property values once a homeowner reaches 65 years old remains in place.
 
All of the above critical questions should be examined within the context of who will benefit most from better transit.   The fact is our local economy will benefit.  Employers will be better served.  And some of our most vulnerable populations will be better able to contribute to our community.
 
Seniors, for example, are one of the specific groups most in need of better transit.  The Transportation Research Board of the National Academies has issued a series of studies out of concern that our aging baby-boom population who -- being more active later in life than preceding generations -- will require greater investment in public transportation to preserve their mobility.  The risks of ignoring public transit for this group are twofold:  

1.   Economic harm as seniors with expertise and experience are unable to fully contribute to a community’s economic life.
2.   Individual difficulty as seniors become socially isolated.  

Lower-income owners of homes who will see the 79% increase (those valued at $50,000 - $75,000) are precisely the lower-income families that studies show will benefit most from increased access to public transportation.  In a recent Brookings Institution study, Baton Rouge ranked 97 of 100 cities in the percent of zero-vehicle households lacking access to public transit.    The Brookings analysis also ranked Baton Rouge 91 out of 100 cities in working-aged individuals access to transit.  A city-wide tax to create a comprehensive city-wide transit system will have benefits city-wide.   

Thoughtful, moral and principled individuals may disagree. The election will sort out which perspective is the choice of residents.  At Catholic Charities, we have looked at the pros and cons and concluded that the CATS proposal is reasonable, balanced, fair, comprehensive, and targeted at the appropriate area that will gain the most.  Investments in transit improve communities and increase economic opportunity – especially for low income residents, precisely our neighbors who, as Christians, we are invited to offer assistance and with whom we should share our resources in a manner that can increase their opportunities to fully contribute to our community.

3.  Our Gospel Mission

The charitable work of CCDBR is based on the first principle of Catholic Social Teaching; respect for the irreplaceable individual dignity of every human.  We are all made in the image and likeness of our loving God and this calls us to become involved in the lives of others and our community.  As written in the CCDBR strategic plan:
 
Respect for human dignity is not only an individual responsibility, it is a social obligation.  It’s not enough to do a good act if we ignore the underlying causes of human suffering. Christ not only met the immediate needs of people to whom he ministered, he showed us a better way for the future.  At all times, our work should strive to reorder not only individual relationships but broader social conventions, decisions, and actions of public and private agencies that allow disparity to exist and unequal opportunity to regenerate.  
 
With this underpinning, we see that an underfunded public transit not only restricts the opportunities of all individuals in our community – especially the poorest -- it also costs our community as a whole.  
 
Click here to download a print version of this statement. The original statement can be found here.  

 
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