Transit leaders urge help from Congress
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AP
Published: November 18, 2008
WASHINGTON (AP) _ Leaders from 10 transit agencies are pleading with Congress for help as long-term financing deals with investors collapse amid the global credit crisis.
The officials warned Tuesday that 31 of the nation’s largest transit systems could face at least $2 billion in payments in the coming months if hundreds of the deals go bad.
Insurers such as American International Group had backed the deals, but downgrades of AIG’s credit put the arrangements in default.
Transit officials want lawmakers to request that the U.S. Treasury step in and back the deals. They say such a move would pose little risk to the federal government.
The Washington transit system reached an agreement Friday with a bank seeking $43 million from one such financing deal. Metro says it still has 14 similar deals at risk.
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