RFTA’s departing financial officer says system needs quick action
The Roaring Fork Transportation Authority must decide soon whether to slash service or seek a sales tax increase because it will go broke in early 2005 if no action is taken, according to its departing chief financial officer.
CFO Heather Copp said warnings that RFTA is on life support haven’t been overblown. The organization that operates the buses between Aspen and Rifle would be in the red just a few months into 2005 and have a year-end deficit of $1.3 million if nothing is done, she said.
“We’re way overextended. There’s no patching, in my opinion, that we can do any longer,” Copp said. “To me, doing nothing is not an option right now.”
Copp and RFTA Chief Executive Officer Dan Blankenship warned the board of directors about the bleak budget outlook in January. The board has sought various financial reports and has held three debates since then but has been unable to decide if it wants to approach voters for a sales tax increase in November.
Garfield County voters will be asked in a separate ballot question if they want to join RFTA’s district and start paying a sales tax. RFTA is contemplating asking its existing members – Aspen, Snowmass Village, Basalt, Carbondale, Glenwood Springs, Pitkin and Eagle counties – if they will increase their sales tax.
Copp resigned effective May 7 to take a job with an association of 78 governments in southern California. She will continue to work with Blankenship through May to try to resolve the budget crisis.
But Copp made it clear the decision on RFTA’s fate must be made soon by the board of directors. Governments must decided by June if they will place questions on the November ballot.
Copp noted that RFTA is having a professional poll conducted to determine how valley residents feel about a sales tax hike. Results should be available at the directors’ next meeting on May 13.
If RFTA’s board decides against seeking a tax hike at this time, cuts in service must be made, according to Copp. In one report to the board, she and Blankenship said service in the valley should be reduced essentially from 6 a.m. to 6:15 p.m. if no revenues are added. Buses currently run until 2:15 a.m.
RFTA’s directors have said they don’t want to make cuts that severe. However, some members have wondered if there are steps the agency could take to increase efficiency and save money.
RFTA’s taxing ability was approved in 2000 by the towns and counties where it operates. Critics contend the agency should have sought a big enough sales tax at that time to sustain it for more than four years.
But Copp said the problem lies in the fact the economy soured after Sept. 11, 2001, and revenues were never as high as anticipated. Sales tax proceeds plummeted by about 25 percent between 2000 and 2002, she said. Unlike other governments, the newly formed transportation district didn’t have a reserve fund built up to help it weather lean times. To make matters worse, RFTA didn’t have a capital replacement fund adequate enough to supplant aging buses, according to Copp.
“The problem is it’s all caught up to us,” she said. However, she maintained that if the economy had not nose-dived, “we wouldn’t be having this conversation.”
Even though RFTA’s revenues have fallen, it has increased its service since 2000. Those increases were necessary to fulfill campaign pledges, according to RFTA officials.
Copp doesn’t want to see RFTA in that position again. No promises should be tied to the possible approval of a sales tax increase this November, she said. The tax increase is necessary to fund existing service, not additional service.
If full taxing powers are sought and approved, it should balance the RFTA budget through 2020, Copp said. Any additions to service could be made if RFTA is able to build its reserve fund, she continued.
While Copp warned against making promises for increased service, she also advised against cutting service now if a tax hike is sought in November. Such action may not be politically popular, she noted.
When asked if she was frustrated that RFTA’s board of directors hasn’t plotted a direction yet, Copp refused to cast any blame. “There’s always frustration that we’re not moving more quickly,” she said.
Scott Condon’s e-mail address is email@example.com
n see Copp on page A7
n continued from page A3
“To me, doing nothing is not an option right now.”
Ð Heather Copp, CFO
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