Federal Funds Not Needed for Metro Rail, U.S. Says

The Reagan Administration launched a new offensive Monday against the proposed Los Angeles Metro Rail project, contending that “ample” state and local money is available to build the initial 4.4-mile segment and even finish the entire commuter system without additional federal funds.

“Metro Rail is eminently affordable if the federal government would pull out tomorrow,” Ralph L. Stanley, administrator of the Urban Mass Transportation Administration, told a news conference. Transit officials in Los Angeles disagreed, and indicated that they would continue to seek federal funds.

Stanley said he based his statement on a preliminary analysis of cash-flow projections supplied to UMTA last month by the Southern California Rapid Transit District.

After reviewing that information, Stanley said he had decided that RTD should not receive federal funding for the $1.25-billion first leg of Metro Rail beyond the $225.7 million that Congress already has appropriated.

In a contract now being negotiated, RTD officials want those funds committed to Metro Rail plus an assurance by UMTA that $203.2 million more promised by Congress will be forthcoming in future years.

But Stanley made it clear Monday that he would not give any such assurances. He said the Administration is adamantly opposed to the RTD’s request for that future outlay for the first phase, planned to extend from Union Station downtown to Wilshire Boulevard and Alvarado Street. That amount, he said, is “simply not negotiable.”

A Democratic congressional aide pointed out that Congress could still appropriate the funds over the Administration’s objections.

“Mr. Stanley has been against Metro Rail as long as he has been in office,” said the aide, who asked not to be identified. “You have to wonder if this is just another effort to kill it.”

Pressure on RTD

The Reagan Administration opposes the project as too expensive and has delayed the release of federal construction funds. Late last year, however, Congress ordered the Administration to enter into negotiations on a contract to provide the full $429-million federal share that Los Angeles officials say is still needed.

Stanley’s comments appeared designed to both put pressure on the RTD to sign a proposed funding contract that he offered in March and to undercut the ability of local officials to argue for more federal appropriations for the project. His press conference came just two days before stalled negotiations on the funding agreement were scheduled to resume and as Metro Rail supporters wrapped up a series of appearances in recent weeks before congressional committees seeking $150 million for the project in the 1987 budget.

Stanley based his assertion of sufficient local funds on projections of income to the Los Angeles County Transportation Commission from a half-cent sales tax for transit.

At a press conference in Los Angeles, local transit officials said Stanley’s analysis was inaccurate. RTD General Manager John Dyer said, “We can demonstrate there is not sufficient money to do everything Mr. Stanley represents.”

Contract ‘Unacceptable’

Supervisor Deane Dana, chairman of the county Transportation Commission, said Stanley’s announcement is “only a negotiating tool.”

Dana said Stanley’s proposed funding contract is “unacceptable” because it requires local transit officials to make up the $203-million gap in federal funds that Congress has promised for the project but not yet appropriated.

Noting that the Transportation Commission is committed to building a 150-mile, countywide commuter rail system, Dana said if large amounts of money were diverted to Metro Rail “we would literally be guilty of stealing funds from the rest of the residents of Los Angeles County.”

Stanley said his analysis was based on RTD’s own numbers and that they show that building the entire transit line without additional federal aid would not disrupt plans for plans for completion of the Los Angeles-to-Long Beach, Century Freeway or San Fernando Valley light rail projects.

Assurances Sought

In a letter to the RTD, Stanley said: “It is totally within the power of the Southern California Rapid Transit District and the Los Angeles County Transportation Commission today to ensure that Metro Rail is begun and completed. In these circumstances, I find it difficult to understand the delay in your accepting the contract offer.”

Stanley said that in return for release of thus far blocked federal funds, local officials in Los Angeles had to assure the transportation administration that they would complete Metro Rail’s first leg. “We’re past the day we’re going to start projects we can’t finish,” he said.

He said his review of financial projections supplied by the RTD showed that the transit district would have more than $8.8 billion in total capital revenues from all sources through the year 2000, including $704.8 million this year.

Penny Pagano reported from Washington and Rich Connell reported from Los Angeles.