Transit Agencies Facing 'Unprecedented' Financial Crisis

"Two Congressional leaders Wednesday called on the U.S. Treasury and Federal Reserve to open the $700 billion government rescue package to the country's transit agencies, which they said are at risk of losing up to $16 billion.

As many as 30 transit agencies are at risk of default or collapse due to financing deals with certain banks, Rep. James Oberstar, a Minnesota Democrat, and Rep. John Mica, a Florida Republican, wrote to the country's economic leaders.

Calling the situation 'unprecedented,' the two leaders of the House Transportation and Infrastructure Committee said the Treasury should use its new authority to buy distressed securities to 'help the transit agencies resolve this issue.'

'These defaults -- if processed -- could cost some of the nation's largest transit agencies hundreds of millions of dollars, and could threaten their very existence and the financial stability of the state and local governments that fund them,' the Representatives wrote."