Economic collapse and transit financing

Via Yglesias Judge grants DC's Metro transit system relief after Belgian bank demands $43 million payment - Los Angeles Times

"WASHINGTON (AP) _ A federal judge has granted temporary relief to the Washington area's transit agency after a Belgian bank threatened to immediately collect $43 million on a loan.

KBC Group requested the money following the collapse of insurance giant American International Group, which had guaranteed a financing deal with the Metro system in 2002.

The transit agency says the bank's demand would require immediate cuts and delay improvements at a time when ridership is rising. It warned that other agencies could face the same predicament.

U.S. District Judge Rosemary M. Collyer said Thursday she would hold a hearing Nov. 12 for the parties to argue the case."

Similar stories seems to be affecting lots of agencies that borrow funds. See also:

The Reckoning - From Midwest to M.T.A., Pain From Global Gamble