SamTrans might get VTA's bond money

Santa Clara County's Valley Transit Authority isn't anxious to use its share of new state transportation bond money to settle a 20-year-old dispute with its counterpart agency in San Mateo County, spokeswoman Jayme Kunz said.

The authority would rather spend the $45 million to expand rapid bus service to Palo Alto and start a new line on Stevens Creek Boulevard in San Jose, Kunz added.

But the VTA might not have a choice.

That's because the regional commission that distributes the bond money sees the windfall as a chance to repay SamTrans for the 1991 purchase of the rail line that became Caltrain.

The Metropolitan Transportation Commission is considering a plan to require both the VTA and San Francisco to settle their debt to SamTrans before receiving any additional Proposition 1B money.

"We would very much like to fund projects on the Peninsula and in Santa Clara County," said MTC spokesman Randy Rentschler. "But in return we would also like to see a resolution to these disputes that have frayed the (Caltrain) partnership, which we think is bad for the customer."

A multimillion-dollar settlement would be a godsend for SamTrans, which faces a deep budget gap stretching years into the future. SamTrans believes it deserves some help from its two Caltrain partners, because it chipped in an extra $82 million in 1991 to make the rail line purchase possible.

Although there was no official timetable, the agency spent the money with the expectation it eventually would be repaid, said SamTrans spokesman Mark Simon.

The principal on the debt is $34.6 million from the VTA and $8.3 million from San Francisco - and then there's the question of interest.

But the VTA argues that it believed all along the Caltrain line was overpriced, and never formally agreed to pay back the extra money SamTrans spent.

Besides, Kunz said, "VTA has already met the spirit of its commitment in the hundreds of millions of dollars we've invested in Caltrain improvements" in the years since. She pointed to the $33 million that the VTA spent on extending the Caltrain line to Gilroy in the 1990s.

SamTrans' Simon said that's comparing "apples to oranges." He pointed to language in the 1991 Caltrain purchase agreement that calls for the VTA and San Francisco to "use their best efforts" to obtain money from non-local sources to repay SamTrans.

"It's understandable the VTA would be upset" at the prospect of losing its bond money to a neighboring county, Simon said. "But we were surprised to hear that they didn't think they owed us anything.

"We're not interested in having a fight over this issue, but we're interested in having a discussion," Simon added.

Kunz said the VTA wouldn't rule out a discussion with SamTrans at some point in the future, but it doesn't want to do so under duress from the MTC.

Rentschler said he hopes the MTC can help resolve the dispute much as it did the feud between SamTrans and BART over the Airport/Millbrae extension. In that case, SamTrans had to pay a good chunk of its own Proposition 1B money to extricate itself from the BART deal.

"The option is to let this dispute simmer and get worse," Rentschler said.