When settling credit card debt, watch out for scams

ou snicker when you hear an ad for a pill that will vaporize belly fat. You scoff at suggestions that you can work at home and earn more money than Warren Buffett.

But when you hear about a program that promises to significantly reduce your credit card debt, you wonder: Do these debt-relief services really work?

Debt-settlement companies typically try to negotiate with credit card companies to reduce the amount you owe. Rising unemployment has led to a sharp increase in the number of consumers who are behind on their payments, creating a receptive audience for their services. But like a weight-loss product that causes you to gain 10 pounds, some of these programs could leave you even deeper in debt.

Federal and state regulators have brought a number of actions against debt-relief companies for misleading and deceptive practices.

Last week, Chase Card Services, a division of JPMorgan Chase, said it will forgive the debts of more than 13,000 credit card holders who were allegedly defrauded by a Florida-based group of debt-settlement companies.

The settlement stemmed from a lawsuit brought by Florida Attorney General Bill McCollum against the companies. The lawsuit alleged that customers were told to stop sending monthly payments to their credit card companies and send the money instead to the debt-settlement firm, which promised to reduce debts to pennies on the dollar. Instead of sending the money to credit card companies, the lawsuit alleged, the group used it to pay attorneys' and processing fees.

For some borrowers with large debts that can't be repaid within three to five years, a reputable debt settlement company may offer an alternative to bankruptcy, says Gerri Detweiler, credit adviser for Credit.com, a consumer site. Legislation enacted in 2005 has made it more difficult for some individuals to file for Chapter 7 bankruptcy, which eliminates most debts. Chapter 13 bankruptcy requires you to agree to make up to five years of court-ordered payments, and you may be required to surrender some assets.

Still, bankruptcy offers more legal protection than debt settlement: While you're filing for bankruptcy, your creditors can't file lawsuits or harass you. "I would never suggest someone go into debt settlement unless they've met with an attorney, and the attorney concurs that bankruptcy may not be the best option," Detweiler says.

If you decide to pursue debt settlement, watch out for red flags. Warning signs:

•The company charges a large upfront fee. Many of the debt-relief companies targeted by federal and state regulators demanded thousands of dollars in fees and never delivered on promises. If a company gets most of its payment upfront, Detweiler says, "They don't have much incentive to do a good job for you." Ideally, fees should be tied to results.

•The company claims that debt settlement won't affect your credit report. Not true. While successful debt settlement will reduce the amount you owe, "Your credit will be significantly damaged," Detweiler says. "If you're weighing bankruptcy vs. debt settlement from a credit report standpoint, there's not much difference."

•The company claims it can protect you from lawsuits. "While creditors do settle debts every day, it's an adversarial process," Detweiler says. "You could be sued."

•The company claims it can eliminate all of your debts. These companies provide, for a fee, a document that purports to absolve the consumer from credit card debts because the original line of credit was illegal. Consumers who fall for this scam end up with higher debts, ruined credit and calls from a collection agency.

There are low-cost alternatives to debt settlement. Call your lenders and see if they're willing to negotiate with you directly.

Another option is a non-profit credit counseling agency, says Chuck Bell, programs director for Consumers Union. A credit counselor may be able to negotiate a debt-management plan with your lenders that allows you to repay your debt over time, sometimes at a lower interest rate.

You can find a credit counselor in your area at www.debtadvice.org, the website for the National Foundation for Credit Counseling, or www.aiccca.org, the website for the Association of Independent Consumer Credit Counseling Agencies.

Ideally, Bell says, "You're going to get an independent source of advice, not somebody who is going to profit from your misfortune."

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Earlier notice on rate hikes gives credit card users options

Here's another good reason to pay attention to mail from your credit card company: You could soon receive a notice that the interest rate on your credit card is going up. That's the bad news. The good news? Well, there isn't much, but how about this: You may actually have time to figure out what to do about it.

Within the next few weeks, credit card issuers will be required to give borrowers at least 45 days' notice before making a significant change in their interest rates or fees. The heads-up requirement is included in a credit card reform bill President Obama signed in May. Most provisions in the Credit Card Accountability, Responsibility and Disclosure Act don't take effect until next year, but the advance-notice requirement kicks in on Aug. 20. Previously, credit card issuers could raise rates with just 15 days' notice.

There are some exceptions to this requirement. If your card's interest rate is tied to the prime rate or similar benchmark and that benchmark changes, your issuer doesn't have to give you advance notice, says Ben Woolsey, director of marketing and consumer research for CreditCards.com. However, Woolsey says, issuers will be required to give you 45 days' notice if they increase the margin, which is the amount added to the benchmark index to calculate your annual percentage rate.

In the past, consumers have complained that by the time they learned about a rate increase, they didn't have time to do anything about it, says Gerri Detweiler, credit adviser for Credit.com. "This will give consumers a little longer to sort out their options if they get a notice of a change in terms," she says.

Your best bet, of course, is to pay off your balance before the rate increase. If that's not possible, you have two choices:

•Repay your balance at the higher interest rate. If you have a small balance and the rate increase is modest, this may not cost you much. And if you have other credit cards with lower rates, you can use them for future purchases.

Many borrowers, though, aren't dealing with modest increases. While the law requires issuers to notify borrowers of a rate increase, it doesn't cap the amount. And in advance of more stringent rules that will take effect next year, many credit card issuers are imposing significant increases in borrowers' rates.

•Opt out of the rate increase. The law requires issuers to give borrowers the option of paying off their existing balance at the old rate. Typically, once the balance is paid off, your credit card issuer will close your account, says Curtis Arnold, founder of CardRatings.com.

Since you're probably already ticked off at your credit card issuer for jacking up your rate, opting out and parting ways may seem like a sensible and satisfying choice. But before you head down this path, it's important to understand how it could affect your credit score, Arnold says.

One of the factors used to calculate your credit score is what's known as the "credit utilization ratio," which is based on the amount of credit you have outstanding as a percentage of your total available credit. For example, if you have $10,000 in available credit and owe $2,000, your credit utilization ratio is 20%. Keeping your utilization rate low helps your score.

When you close a credit card account — or your issuer closes it for you — the amount of your total available credit shrinks, which could lead to a higher utilization rate, says Craig Watts, spokesman for Fair Isaac, developer of the widely used FICO score.

Watts adds, however, that the impact of closing an account varies, depending on the individual. If you have low balances on your other cards, closing one account isn't going to shift your utilization rate enough to affect your score, he says. If you have a lot of outstanding debt, though, closing one account could change your utilization ratio enough to lower your credit score, he says.

Before deciding whether to opt out or stay in, get out a calculator and figure out how much the new interest rate will affect your monthly payments. If you're trying to make ends meet and face a big increase in your monthly payments, you should seriously consider opting out, says Bill Hardekopf, chief executive of LowCards.com.

Once you've paid off your balance, you can focus on rebuilding your credit score, Watts says. If you're having trouble making your monthly payments, "deal with that situation first," he says. "You can always improve your credit score over time after you take care of current priorities."

READ MORE - Earlier notice on rate hikes gives credit card users options

Prince Harry: New York trip has been 'fantastic'

As Britain's Prince Harry neared the end of his second and final day in New York City on Saturday, he described his experiences as "fantastic."

The 24-year-old visited the Harlem Children's Zone, a nonprofit organization that offers free programs and classes in a low-income area, then went to Governors Island in New York Harbor to play in the Veuve Clicquot Manhattan Polo Classic.

Profits from the match will benefit Sentebale, a charity for orphans in Lesotho, Africa, a cause Harry's mother, Princess Diana, had promoted. The prince was accompanied by Prince Seeiso of Lesotho, who also lost his mother when he was young.

The men toured the Children's Zone with founder Geoffrey Canada, and spent time in a classroom where some students were studying for a math test. A 10-year-old girl sitting at a desk covered with drawing paper and colored markers gave Harry a picture.

"Is this for me?" Harry asked as he accepted it. Pointing to the desk and pens, he then asked, "You find yourself very lucky to have all this?" When she nodded, he replied "Good."

A young boy gave Harry a bowl containing a dish he had prepared, and the prince ate it while the child sounded off the ingredients. Throughout the classroom visit, the prince smiled and chatted easily with students.

Cheering people lined the street as Harry entered the building. As he left, reporters shouted questions.

Asked how he liked his first official visit overseas and meeting the children, the prince responded, "It's been fantastic -- really, really worthwhile."

"It's my first visit to New York. I'm hopeful I'll come back to visit again."

He also was asked whether he thought his appearances would change any image the public might have of him, apparently referring to some of his wild exploits ways when he was younger.

Those incidents included a one-day stint in drug rehab in 2002 and accusations of racism in January.

"I don't know what the image is of me. There is always the image that's been given to me, but people have their own opinions, it's the media that likes to stamp on the image which isn't really me."

On Friday, the youngest son of Princess Diana offered his condolences to September 11 victims at the former site of the World Trade Center. The prince met New York Gov. David Paterson and briefly spoke with family members of 9/11 victims. The prince then laid a wreath at the site and bowed his head in a moment of silence.

He left a handwritten note tacked to the wreath, citing an "the courage shown by the people" of New York on September 11, 2001.

Harry later paid tribute to his fellow citizens at Lower Manhattan's British Garden at Hanover Square, where he honored the 67 British victims of the September 11 attacks, officials said.

The third in line for the British crown, Harry is active in the British Army. He received a promotion to lieutenant in April 2008 and is currently training for an Army Air Corps pilot position, according to the prince's Web site.

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Pillow Saves Girl, 8, From Bullet

MOORE, Okla. -- Police are investigating a shooting outside a Moore home where a bullet narrowly missed hitting an 8-year-old girl while she slept in her bed.

The bullet came through a window, shattered the glass and woke up the girl and her parents. They didn't find the bullet hole until the next morning.

"It was this small hole in the blinds, that stuck out at first," said the girl's stepmother, who asked to be identified only as "Jennifer". "I thought, 'What else could go through that and cause such a big hole?'

"The much larger hole in the window indicated that someone had fired a shot into her 8-year-old daughter's bedroom.

The bullet seemed to have disappeared until Jennifer's stepdaughter noticed a mark on her pillow."

The front of the pillow had a hole. The back of it didn't," she said. "I dug around and it was deep in there.

"The bullet had landed inside the pillow that was just inches away from her stepdaughter.

"It landed between her legs," Jennifer said. "There was a pillow at the bottom of the bed between her legs and it landed in that pillow.

"She said she thinks the shot may have come from an open field behind her home. Police said there's no way to know for sure.

"It was somebody just messing around, doing something for fun, shooting at a target," she said. "The bullet is going to go somewhere, and it could be into a person.

"Police said they got a call of shots being fired in that area early in the morning but didn't find anything when they arrived. Officers said they currently have no leads about who may have fired the shots.

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U.S. vows to keep using 'state secrets' defense

The Obama administration has informed a federal judge it will continue to invoke the "state secrets" privilege in a legal battle with an Islamic charity suspected of funding terrorism.

The United States has designated the Oregon-based al-Haramain Islamic Foundation as a terrorist organization. The group, which has sued the government over alleged warrantless wiretapping, is demanding classified information about the program.

U.S. officials have refused to tell the charity's lawyers whether the group was subjected to presidentially authorized, warrantless, foreign intelligence surveillance in 2004 and, if so, what information was obtained.

In a court document filed overnight in San Francisco and released early Saturday in Washington, the Justice Department said its case-by-case review of the government's use of the state secrets defense has not changed its position in the al-Haramain case.

The defense allows courts to block lawsuits against the government on grounds that the litigation could harm national security.

"An additional review was conducted at the highest levels of the Department of Justice to determine whether continued invocation of the privilege was warranted," the government told the court.

"Based on that review, it is the government's position that disclosure of classified information ... would create intolerable risks to national security."

The Obama administration has criticized President Bush's Justice Department for invoking the state secrets defense too quickly.

Attorney General Eric Holder has ordered a review to determine whether the government's use of the state secrets privilege can be sharply narrowed. The government brief, however, reveals the legal tool will continue to be used despite strong objections from civil liberties groups and their political allies.

"The government does not take this position lightly," Justice Department lawyers told Judge Vaughn Walker, who has been unsympathetic to the government stance.

"An assertion of the state secrets privilege to preclude further litigation is an extremely significant step that requires in-depth consideration and debate at the highest levels of our government," the Justice document says.

All sides acknowledge the importance of the case.

"The government recognizes that the underlying dispute in this case raises the fundamental separation of powers question concerning whether the court has the ultimate authority under the Foreign Intelligence Surveillance Act (FISA) to order the disclosure of state secrets to a private party over the government's objections," according to the justice filing.

The immediate issue is Walker's May 22 order to show cause as to why the government should not be sanctioned for "failing to obey the court's orders" to turn over classified information.

The government insists it has not yet received a direct court order to do that, and has only refrained from "agreeing" to do so. The government vowed a swift appeal once it receives such an order.

The Obama administration argument concludes with a direct challenge to the judge "to recognize that the imposition of discovery sanctions is not a lawful, appropriate, or productive alternative."

In 2007 the 9th Circuit Court of Appeals overturned a ruling by Walker in the same case in which he had rejected the government's state secrets privilege. The ruling, however, left unanswered whether the FISA law could preempt the state secrets privilege, so al-Haramain went back to court to continue the fight on that issue.

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Hired! New Job, New State, New Start

The 2.3 million college grads in the class of 2009 are finding that starting a career in the current economic climate will require some sacrifice.

While 73% of recent graduates worry about finding work after graduation, 50% say they have already changed or plan to change their career path, according to the State of the Student Survey released recently by DeVry University.

But putting long-term goals on hold and taking a "bridge job" don't have to derail a grad's ambitions.

Shalyn Pugh, 21, was living in Vancouver, Washington, and working as an Americorp volunteer during her last year of college at Washington State University. With a degree in public affairs and environmental science, Pugh planned on a career in environmental education and outreach.

"I was set to graduate early. I thought that was a good thing. Having worked as a research assistant and an Americorps volunteer in Clark County, just north of Portland, Oregon, I figured finding a job in the non-profit world would be a snap," she said.

But after 8 months of searching, Pugh didn't land a single interview.

"It was a stalemate," she said.

With no leads and news of her sister's pregnancy, Pugh decided it was time for a change. She moved to Bend, Oregon, to be closer to her sister and brother-in-law. That's when her brother-in-law told her about a position at his company, G5 Search Marketing.

Although the position as a Web QA specialist was a far cry from what Pugh had intended on doing, it was a full-time job with benefits -- and it was available.

"After a couple rounds, I was on the team," she said. Now, "here I am, three hours from where I was job hunting, in a different industry than I intended."

Pugh also discovered that she loves her new job testing formatting and design changes for G5 clients as well as her place in Bend, which she shares with her dog, Lulu.

Eventually she plans to resume her pursuit of a career in environmental law or science, but for the time being Pugh is learning about HTML coding, search engine optimization and how to build web pages.

"I believe the skills I'm gaining now will be more than useful in the future regardless of the industry I'm working in," she says.

For now, her sights are set on the impending arrival of her niece or nephew, due any day.

Compromise is O.K.

For other job seekers trying to stay afloat in the worst job market in 25 years, our career experts agree that finding a job for the interim is a good idea -- even if it is outside your desired industry and region.

"Do what you need to do to satisfy your needs today," said Gerry Crispin, co-owner of Careerxroads, a consulting firm based in New Jersey.

According to Ford Myers, president of Career Potential, LLC, a Pennsylvania-based career consulting firm, there are times when it is appropriate to get what he calls a "bridge job," when the opportunity you want may be out of reach.

"You've got to do something temporary until you can find the opportunity that you're really looking for," Myers said.

That's not always a bad thing. As in Pugh's case, sometimes trying different fields can uncover a new interest, or develop a valuable skill. "It may seem like a detour," said Kathy Robinson, the founder of TurningPoint, a career consulting firm in greater Boston, but "she's learning a skill set that may apply to the environmental field down the road."

"The important thing is to never lose sight of your real career goals," Myers added.

To that end, Crispin recommends that job seekers stay connected to their career of choice by joining professional associations, tracking colleagues in that industry and building a network of contacts.

"If you can't meet your dream today, then decide what it is you can do without necessarily giving up your dream forever," Crispin said

READ MORE - Hired! New Job, New State, New Start

American Dream Slipping Away

There was a time, not very long ago, when getting a job on the production line at a big automaker meant an instant ticket to the American dream, even for someone with little formal education. Not anymore.

"The minute you signed the paper, you were instantly vaulted into the middle class," said Mike Smith, director of Wayne State University's Walter P. Reuther Library in Detroit, named for the founder of the United Auto Workers, the union that represents auto workers.

A shrinking paycheck. As the auto industry undergoes a sea change, the government has demanded that Chrysler and General Motors (GM, Fortune 500) bring their labor costs in line with foreign competitors operating non-union factories in the U.S.

Today, an entry-level autoworker in a "non-core" position will make $14 an hour, compared to the $28-an-hour "base rate" others make, according to a summary of Chrysler's contract agreement.

Workers' benefits have also taken a hit.

"Workers coming in will have good benefits and a good wages but not necessarily what they were 20 or 30 years ago," said Smith.

Anemic health care. New UAW employees will pay a much larger portion of their health care expenses and once they retire, carmakers won't pay for it, according to information from the Center for Automotive Research.

Fewer medical procedures and drugs will be covered and, under new agreements, Chrysler and GM retireees won't have dental and vision care covered.

Eroding unemployment benefits. As GM and Chrysler restructure, the UAW has agreed to give up salary protections that had cushioned laid off autoworkers... [Read More]

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How much cash should you have in your portfolio?

When the markets began to tank last fall, investors fled to cash and cash-like investments. No one cared if yields were paltry. The return of principal rather than the return on principal was the biggest priority.

The result today is that you may hold more cash in your portfolio than during the years leading up to the bear market. According to a recent survey of 401(k) plans by Hewitt Associates, investors added 11% to stable-value funds in 2008. (Stable value funds invest in short-term bonds that carry an insurance “wrapper.”)

But with the immediate crisis out of the way (let’s hope), how much cash do you need going forward?

Steven Romick, manager of FPA Crescent Fund, recently stopped by Money’s offices. He says FPA Crescent, which invests in both bonds and stocks, currently has little more than 20% allocated to cash, down from roughly 40% back in September. Romick’s shift makes sense from a long-term perspective. Consider: Today, the average rate on bank money market accounts is only 1.33%, according to Bankrate.com. Factor in inflation, and cash doesn’t give your portfolio the growth it needs.

But Romick also says this: “The idea that you’re invested at all times [in say, equities] presupposes there is no better deal coming down the road.” In other words, cash gives you flexibility, which you need if you want to be able to pounce on investment opportunities as they arise.

So how much cash should you have ? As always, you’ll have to consider your goals, time horizon and risk tolerance. You’ll also want to look at how much cash is held in the mutual funds you own. Many fund managers, such as Romick, loaded up on greenbacks last year.

If you need to scale back and build up say, your equity or bond allocation, make the shift gradually. And promise yourself you won’t abandon cash altogether during the next market boom.

Finally, remember that separate from your portfolio, you also want emergency savings to cover at least six months of living costs. That money should be kept in a safe, liquid spot, such as a bank savings account.

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Are U.S. bonds really a safe haven?

It looked like a no-brainer. With a flight to quality last year pushing up U.S. Treasury bond prices and risky loans looking like losses waiting to happen, U.S. banks ploughed money into government bonds. And until about mid-May, when prices of 10-year securities topped 100 cents on the dollar, that looked like a good bet. Now, however, this safe haven isn't looking quite so secure.

A rebound in risk appetite and worries about Uncle Sam's credit rating has drained some air from the Treasury market bubble. A 10-year bond now fetches only a little over 95 cents on the dollar. That may not seem like much of a drop, but if you think of banks leveraging up their positions, it could result in some nasty losses.

How much so? Well, American depository institutions hold some $581 billion in various types of government obligations on reserve with the central bank, according to Federal Reserve statistics.

Of course, the cost of funding these positions has also plummeted. The London interbank offered rate (Libor) for three-month dollar borrowings is now a mere two-thirds of a percent. And a steeper yield curve is a boon for banks looking to earn their way out of trouble through fat net interest margins.

But one could argue that Libor is being artificially depressed by the U.S. government's interventions to prop up bank credit. Should they withdraw those measures -- say, by pulling its borrowing guarantees, its liberal discount window collateral requirements or other programmes -- Libor could easily rise to a level appropriate for the industry's average single-A to double-A credit. That was over 5% in 2006, for example.

Should that happen, and longer rates also struggle higher, banks run the risk of losing money on their hordes of Treasurys, just when their plummeting prices make them hardest to unload. If so, this port in the storm could turn out to be quite choppy.

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More U.S. airports add rail service to downtown

Riding the rails between downtown and the airport is becoming a reality for more U.S. travelers.

With their roadways jammed with cars and shuttles, a growing number of domestic airports are building or have plans for a rail link that will connect passengers from the terminals to regional metro-rail systems, allowing road warriors and vacationers to ditch their cars.

"There is a consensus building that this is a desirable piece of overall strategy to deal with ground transportation challenges," says Matthew Coogan, director of New England Transportation Institute who has written extensively about the subject.

Direct rail connections to Seattle-Tacoma and Dallas Love Field are expected to open later this year. Other large airports with an approved rail project that will be completed in the next few years: Salt Lake City, Phoenix Sky Harbor, Miami, Dallas/Fort Worth and Oakland.

Several other airports, including Denver, Washington Dulles and Los Angeles, have similar plans, but their projects are years from completion.

Airport rail links have long been popular in Europe and Asia. But only eight of the 20 largest U.S. airports, based on 2008 boardings, have rail service that drops passengers off within walking distance of the terminals: Atlanta, Chicago O'Hare, New YorkJohn F. Kennedy, San Francisco, Newark, Minneapolis, Boston and Philadelphia.

But a confluence of operational and economic factors have pushed the airport rail agenda forward in recent years despite opposition from taxi and bus proponents and fiscally conservative lawmakers.

With air traffic rising rapidly in recent years, airports are learning that simply building more parking lots and enlarging roadways aren't sustainable practices, Coogan says. Many U.S. airports have also embraced the green movement, budgeting more for programs that reduce their carbon footprint.

Greater availability of federal funding sources for airport rail is helping the cause. After a rigorous application process, Phoenix Sky Harbor persuaded the Federal Aviation Administration to let it use the passenger facility charge — a fee added to air tickets — to partially fund its rail project. Oakland received $70 million for its rail project from the federal economic stimulus package this year.

Popular rail services

Experts cite Washington, D.C.'s metro service to Washington Reagan National, Bay Area Rapid Transit's (BART) connection to San Francisco International and New York JFK's 8-mile AirTrain that links to the local subway as the most heavily used and popular systems in the USA. They also feed into established and far-reaching regional metro systems that are easy to use for travelers who forgo rental cars. Since it opened in 2003, AirTrain ridership has grown steadily, and about 4.75 million paid to ride the JFK train in 2008, according to the Port Authority of New York & New Jersey.

"When I fly to SFO, I always take the BART from the airport to my office in downtown San Francisco, and I love it," says business traveler Marc Belsher, a health care technology consultant. "It is inexpensive, reliable, relatively fast and ultraconvenient. It is the natural choice for me, especially in this economy."

Cleveland, St. Louis and Portland, Ore., run smaller rail systems that also provide direct-to-airport service. The number of travelers using Portland Metro's service to the airport grew 7.7% in 2008, says Steve Schreiber, aviation director for Portland International.

Still, airport-rail ridership in the USA is woefully low compared with other countries, says Andrew Sharp, director general of the U.K.-based International Air Rail Organisation. In many European and Asian airports, 20% to 30% of travelers get to and from the airport using rail. In the USA, ridership typically ranges from 2% to 5%, he says.

Airports actively pursuing a rail connection have several options:

•Add to existing systems.Seattle's Sound Transit, a voter-approved initiative passed in the late 1990s to create a regional light-rail system, is close to finishing its latest line. The Central Link, a 16-mile line running between downtown Seattle and Sea-Tac airport, will launch later this year. Its airport station is scheduled to open in December.

About a decade ago, Salt Lake City had no public rail. The Utah Transit Authority has since built a system that covers about 150 miles. A 5-mile downtown-to-airport connection is under construction and scheduled to open in 2012, says Michael Allegra of UTA. He expects about 6,000 riders daily when it opens.

One of the largest construction projects in the nation's capital is a 23-mile extension of the region's Metro to Washington Dulles. The new line will also serve the Tysons Corner area, Virginia's largest employment center. The completion date hasn't been determined.

•People-mover rail. Some airports have a metro station nearby but not within walking distance. To close the gap, they are looking to automated people-mover trains as a solution. Because people-movers typically run within airport grounds, airport authorities can tap funding sources that are available only for airport projects.

Phoenix Sky Harbor will use passenger facility charges to partially fund its Sky Train, a people-mover that will open in 2012 and connect to a nearby light-rail station. One airport station will contain an enclosed and air-conditioned moving walkway that will take travelers directly to the terminals.

BART this month approved funding for a 3.2-mile elevated people-mover that will connect BART's Coliseum station to Oakland International, replacing the current bus connection. It's scheduled to enter service in 2013. About 4,300 Bay Area passengers a day are expected.

Meanwhile, Miami-Dade Transit broke ground last week on a people-mover extension from the Earlington Heights station — the nearest stop to Miami International— to a ground transportation hub that's being built next to the airport. The rail link and the ground transportation hub are both expected to be completed in 2012.

Ongoing debates

Like most large construction projects, airport rail proposals face stiff headwinds. Opponents challenge funding sources and new taxes and cite preferences for cars and buses. But the central argument in most debates has centered around ridership, specifically whether airports have enough demand to justify millions in cost.

BART's connection to SFO, completed in 2003, has yet to reach BART's initial ridership forecast and is still not profitable. Prior to construction, BART projected there would be 17,800 average daily boardings to and from the airport by the year 2010. As of this month, SFO ridership was at about 11,000.

Frank Sterling and Juliet Ellis, activists in the Bay Area, also questioned BART's plans to spend $500 million for Oakland International's people-mover and its decision to charge $6 for the service vs. $3 for the current shuttle bus.

"The proposal to charge double that for the new connector might drive away customers, unless it delivers twice the value," they wrote in a recent newspaper commentary, "Can East Bay residents afford this?"

These are appropriate debates, Coogan says. Some cities are better off sticking to buses, he says. For example, LAX's FlyAway Bus, which provides non-stop rides to various neighborhoods in Southern California, is more convenient for many travelers than the metro.

For some cities, it'd be wiser to spend scarce funds for extending metro to public transportation-friendly suburbs before considering airports, Coogan adds.

"How often does a person go to work? And how often does a person go to Paris in a year?" he says.

In Seattle, where light-rail coverage is still growing, expectations are modest, with 3,000 riders a day expected at the airport station initially. "We're at the beginning. It's a step-by-step process," says Ron Lewis of Sound Transit. "But there are other neighborhoods that will be served by the line along 15 miles."

By Roger Yu, USA TODAY

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