Transit Leaders Urge Help From Congress
Metro reached agreement with one bank
Tuesday, Nov 18, 2008 | Updated 5:30 PM EDT
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Passengers board a Metro train at Gallery Place-Chinatown.
WASHINGTON -- Leaders from 11 transit agencies are pleading with Congress for help as long-term financing deals with investors collapse amid the global credit crisis.
The officials warned 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. Such a move would pose little risk to the federal government, they said.
The Washington transit system reached an agreement Friday with a bank seeking $43 million from one such financing deal. Metro still has 14 similar deals at risk, officials said.
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