Over thirty transit authorities across the country (including Atlanta, Chicago, Los Angeles, San Francisco, and Washington, D.C.) are on the hook to banks for billions of dollars as SILO tax shelter transactions unravel in the financial meltdown. AIG had guaranteed the transactions between the transit agencies and banks under which the banks made huge upfront payments to the agencies to buy assets (and claim the associated depreciation deductions) and then leased the assets back to the agencies in return for annual payments. But AIG's financial meltdown has invalidated the guarantees and put the deals in technical default, thereby permitting the strapped banks to demand immediate payment of billions of dollars.
