Bankruptcy and buses

Ron B. from Collier raises an interesting point in a letter to the editor published in Tuesday’s PG. He says that if a private company faced the same problems as the Port Authority, it would file for bankruptcy to either reorganize or liquidate.

The federal Bankruptcy Code has a special place — Chapter 9 — just for government entities that get into financial trouble. An Allegheny County Councilman suggested last month holding a referendum to give the county the power to direct the Port Authority to file for Chapter 9 and put itself out of business. But first, the state would have to grant the Port Authority the ability to file for bankruptcy and Harrisburg has not seen fit to do so.

What would a Port Authority bankruptcy mean? One big effect would be to void the existing contracts, including the transit unions. That’s why the ability to file for bankruptcy is such a powerful tool for struggling private-sector companies. A union would have a lot more motivation to sit down and genuinely discuss the kind of concessions that are necessary for a company to survive when the alternative is that a bankruptcy court judge will toss out the entire contract.

But at the moment, that’s not an option for the Port Authority. Instead, state law permits the transit union to continue to work under the terms of the contract that expired on June 30 for as long as it wants.

Posted by: Ken Zapinski

Planning for reality

Brian O’Neill had a column in the Post-Gazette this week highlighting the Pittsburgh CitiWiki Project that is trying to use the collective wisdom of crowds to develop a transportation plan for the region. (And Brian has already proven he is a prescient observer of emerging trends. Just check out the second-to-last paragraph.)

Anyone and everyone is encouraged by CitiWiki organizer Chip Walter to join in and have their say on what the transportation system needs to look like to keep the Pittsburgh region moving forward (h/t pg).

Anything that gets people thinking and talking about these issues is tremendously useful. Out of the process, “a plan will either emerge or not”, Walters writes on the site. But taking a plan from idea to reality – that’s where it gets really, really hard. (Just ask the folks who spent years working on A Regional Strategic Vision for Public Transportation Serving Southwestern Pennsylvania plan)

At the same time, the Port Authority is actively soliciting public input on its Connect ‘09 redesign of its existing bus and rail network.  So, there is no shortage of opportunities for people to help solve the what they think are the region’s transportation problems.

If the CitiWiki does produce a plan, Walters will organize a public event where “I will ask, in effect, what does government think, how does it plan to handle the plan, what are the next steps we take as a community.”

Trouble is when it comes to transportation (and just about any other issue), there isn’t a single “government” that gets to give the thumbs up. In any regional transportation plan you’d have literally dozens of governmental players, from the smallest municipality up to the U.S. Department of Transportation. And many of them would have effective veto power over significant portions of any plan.

Partly that’s a function of our federal system of government (Washington DC sharing power with the 50 states). But partly that’s because of the way we’ve organized ourselves in SW PA. For instance, if you consolidated the City of Pittsburgh and Allegheny County, you’d eliminate the challenge of keeping those two major players on the same page.

But maybe that’s a subject for a different blog…

Posted by: Ken Zapinski