The New Orleans Regional Transit Authority failed to make a $6 million debt payment this week, catching state officials unaware and giving the city's recovery a black eye with the first government agency default in Louisiana since Hurricane Katrina.
All bus service has been free in New Orleans since buses began running Oct. 2, thanks to support from FEMA through the Federal Transit Administration. The RTA's $110 million operating budget before Katrina depended on sales and hotel taxes, bus fares and federal grants. By contrast, revenue projections for the upcoming fiscal year are about $25 million. Meanwhile, weekly ridership has decreased from 855,000 to about 130,000.
Gov. Kathleen Blanco's chief financial official said no one from the RTA has spoken with the administration about the problem and that his office did not find out about the missed payment until late Wednesday afternoon. The state might have been able to help the RTA avoid the default if it had known about the problem, Division of Administration Commissioner Jerry Luke LeBlanc said.
Once again the question is, "who's in charge?"