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[quote user="Phoebe Vet"] Samantha:You are assigning the entire cost to the sales tax revenue.  Remember the Federal and State Paid a huge portion, and they HAVE been collecting the sales tax since 1998.[/quote]That's partially true.  I calculated the time required to save the sales tax revenue for a pay as you go system without taking into consideration any state and federal payments.  I did not have the state and federal payments to CATS.  I did, however, point out that some of the sales tax revenue probably was used to support the bus operations.  As shown below I was correct.   After a little digging through the CATS webpage, I found some information on funding.  It shows that CATS has issued a significant amount of short and long term debt securities.  A pay as you go system would not issue any debt, although it could have some short term borrowings for working capital purposes.  CATS received the first sales tax proceeds in 1999.  It had been estimated to be $50 million, although the actual number undoubtedly varied.  In 2004 it generated $53.9 million or approximately 54.9 per cent of CATS operating program income, whilst in 2007 it produced $69.2 million or approximately 58.5 per cent.  The estimate for 2010 is $80.9 million or approximately 58.7 per cent.  Forecasts of future financials more than a year out are subject to significant variation.           In 2004 CATS total capital program was $52.9 million.  Federal grants contributed $9.7 million or 18.3 per cent of the total, whilst $8.million or 15.1 per cent came from state grants, $1.7 or 3.3 per cent from miscellaneous income, and $33.5 or 63.3 per cent from operations.  This means, amongst other things, that a portion of the 2004 sales tax proceeds were consumed by operation of the bus system.In 2005 CATS applied approximately $1.9 million from debt proceeds to the capital program.  In 2006 $200 million was applied.  Moreover, from 2008 through 2010 CATS plans to apply $69 million from debt proceeds to the capital program.  And in 2011 it expects to use $70 million of debt proceeds for its capital program.  The capital program, of course, is the build out of CATS infrastructure, i.e. light rail, commuter rail, RBT, etc., and related equipment acquisitions.  To obtain these amounts CATS would have had to or will have to issue debt in excess of the proceeds to cover the investment banking fees.  In 2005 CATS incurred debt service expense of approximately $7.9 million.  By 2006 it had risen to approximately $16.4 million, whilst in 2007 it was $18.2 million.  From 2008 through 2010 CATS expects its debt service charges to hover around $17 million per year, but it expects them to jump to approximately $20 million in 2011.  Equally interesting, CATS redeemed approximately $53.9 million of short term borrowings in 2005.  In 2010 it expects to redeem approximately $70.7 million of short term borrowings, which means that it plans to increase its short term borrowings.Most major capital construction projects include two tier financing.  The first tier usually consists of short term borrowings that are designed to serve as working capital whilst the project is being built.  As the build out nears completion, the sponsoring entity usually issues long term debt, which is used to retire the short term working capital debt and cover the unfunded portion of the capital project.  Clearly, this appears to be what has happened in Charlotte.CATS does not show how much debt it has issued, but given the debt service obligations, it is safe to say that it is significant.  The debt was probably issued as sales tax revenue bonds.  The short term notes were probably issued by CATS, which is a city department, on the full faith and credit standing of Charlotte.  DART began by claiming that its light rail system would be built on a pay as you go basis without any federal monies.  That claim lasted for a short period of time.  Once the DART board realized how much the system would cost, their scruples about issuing debt and going to the feds for help were quietly laid aside.
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