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13 <br />4. The issue of how the new revenues enabled by the Act are to be allocated by the <br />local and regional entities involved is thus a legal question of first impression with no <br />prior or established state legal precedent, ruling or regulation. Interestingly, the <br />language of the statute (at NCGS 105-508.2) specifies that the net proceeds of the <br />sales tax revenues must "supplement ... existing funds or other resources for public <br />transportation systems" (emphasis added). The "other resources" suggests that <br />non-supplantation may well reach the local taxing ability of the local governments <br />that are currently being used for transit, as well as state, federal and farebox <br />revenues. <br />In sum, the presence of the non-supplant language in the sales tax provisions of the <br />Act raises legal doubt about using those funds for current or future increased costs <br />for existing bus services. A reasonable legal argument could be made against this <br />use of the sales tax revenues. Without clear legislative or other legal authority for <br />this use, there is clear risk attached to this course of action. <br />5. At the same time this non-supplant issue is a policy decision that must be made by <br />the "regional public transportation authority" (TTA in the case of the Triangle region) <br />in its development of the financial plan. At NCGS 105-508.1 the law directs that the <br />regional authority develop a "financial plan" which sets out the use of the new <br />revenues. In developing the financial plan TTA has been guided by the intent and <br />purpose of the Intermodal Act shaped by its work with the key legislative sponsors <br />over a three year period prior to enactment. <br />The intent of the Act, in the words of one of its key sponsors, "was to expand public <br />transportation options" in the Triangle and across the state. I believe that TTA will <br />be guided by this understanding of the intent of the Actin its preparation of the <br />financial plan. TTA will also be guided by the understanding that the public is very <br />unlikely to approve new tax revenues for public transit that will be used to pay in <br />any significant measure for existing transit services. <br />6. In light of the considerations of legal risk and legislative intent of the Act, it is my <br />opinion that the TTA General Manager will not lead the development of a transit <br />financial plan and that the TTA Board of Trustees will not approve a financial plan <br />that uses either (1) new sales tax revenues or (2) the additional $3 regional vehicle <br />fees granted by the Act to pay for current costs or for future inflationary increases in <br />the costs of public transportation services now provided. <br />As noted above, the $7 increase in local vehicle registration fees portion of the <br />statutes does not contain non-supplant language. It may be, then, that these funds <br />could be used for either new transit services or for the increased costs of existing <br />transit services, but that frankly there is no firm legal (or policy) basis established at <br />this time for that use. <br />2 <br />