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Latest PAT news reconfirms SPC error on Rt. 228 funds

Butler County residents and officials had cause for anger in December when this county lost $20 million in highway funding for improvements to Route 228. Justifying that anger was the Port Authority of Allegheny County’s prolonged failure to fix its deteriorating financial situation. The Butler County money, plus an additional $25 million from sources elsewhere, was targeted as a short-term fix to keep the Pittsburgh bus system operating for the remainder of its current fiscal year.

It was at the behest of then-Gov. Ed Rendell that the 10-county planning agency Southwestern Pennsylvania Commission (SPC) voted to approve the money shifts, even though the Butler County money, if it was not going to be used for Route 228, should have been allocated for another road project here.

As unfair as the shifting of the money appeared to be in December, news from PAT last week provides grounds for even greater furor over this county’s loss.

The disclosure in question, reported by a Pittsburgh newspaper on Thursday, is that PAT has lost $39.2 million in a complicated, risky transaction called an interest-rate “swaption” that the authority agreed to in 2004 to reap a $9.5 million upfront windfall.

It was the same kind of bad bond deal that victimized some school districts in Butler County and elsewhere in the past.

So, while the $20 million in Route 228 money might not be going directly to fix the negative ramifications of the bad bond transaction, it is making available other PAT funds to be used for that purpose.

So, like it or not, Butler County got taken by the retraction of the road money, and the commission deserves criticism for not demanding — and then putting on the table for all to see prior to the December vote — all of PAT’s ugly financial facts.

It’s true that PAT has in recent weeks approved a 15 percent overall reduction targeted at eliminating 180 jobs and 29 routes. But that doesn’t undo the injustice imposed on this county by a thumb-in-the-dike response to allow PAT to delay — temporarily — the hard, painful decisions that it faces.

Pennsylvania’s new governor, Tom Corbett, must reject any future schemes to help PAT that hurt Butler County.

This county’s “reward” for having contributed the $20 million to PAT was the bus serv-ice’s announcement last month that two bus routes to Pittsburgh that had served Cranberry Township residents would be among the 29 routes targeted for elimination.

The only bus route that will continue to serve Cranberry is the one beginning at the Route 528 park-n-ride lot — a bus stop operated by the New Castle Area Transit Authority.

As explained by the Pittsburgh newspaper’s article, the $39.2 million payment by PAT to Bank of America Merrill Lynch was part of a $263.3 million refinancing bond issue completed last Tuesday. The cost of the payment will be spread over Port Authority budgets starting next year and continuing until 2029, adding more than $2 million in debt service expense per year.

Hopefully the 10-county planning commission has had its eyes opened by this latest PAT news. To their credit, Butler County’s members on the commission weren’t hoodwinked by Rendell and PAT and voted against the transfer of funds.

As for Route 228 improvements, the situation remains a wait-and-see, but there doesn’t seem to be any cause for optimism anytime soon.

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