WASHINGTON - The Washington area's transit agency asked a federal judge Wednesday to issue a temporary injunction against a bank that is demanding $43 million by the end of the week.

KBC Group of Belgium is requesting the money following the collapse of insurance giant American International Group, which had guaranteed a financing deal KBC made with Metro in 2002.

But AIG's financial problems, which prompted a massive loan last month from the Federal Reserve, have triggered a clause that allows the bank to demand all the money at once.

Besides Metro, the collapse of AIG could force about 30 other agencies to repay investors billions of dollars. Those cities include Atlanta, Chicago, Los Angeles and San Francisco.

Metro officials warn that if a U.S. District Court judge refuses to intervene, the agency could find itself in default by Friday. The transit system also would be short on cash to rehabilitate trains and escalators and purchase new buses at a time when ridership is increasing because of high fuel prices.

"The global financial meltdown causing great individual distress and destroying financial institutions now imminently endangers this area's critical mass transportation infrastructure," the complaint states. "An overreaching investor threatens the Metrorail system over a harmless, technical, nonpayment-related default."

The bank, reached in New York, refused to comment.

Lawmakers have urged Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke to have the government step in to back the deals instead of AIG.

A letter sent Wednesday by House Transportation Committee chairman James Oberstar, D-Minn., and ranking Republican John Mica of Florida urged Paulson and Bernanke to "use all of your existing authority" to help resolve the crisis.

The Treasury Department has said it is aware of the problem, but has refused to comment further.

In a once-common practice that the IRS has ended, many transit agencies entered into arrangements in which they sold equipment such as rail cars to banks. The banks then turned around and leased the equipment back to the transit agencies.

Both sides benefited. The transit agencies were given a large sum of money up front, which could pay for various infrastructure upgrades. And the banks were able to rely on frequent lease payments while also writing off taxes on the depreciating property.

The deals were approved by the Federal Transit Administration, which promoted the lease agreements, transit agency officials said.
Metro made 16 of the deals with various banks, selling 600 rail cars worth more than $1.6 billion. In return, the agency made $100 million. Metro's chief financial officer has said that under a worst-case scenario, the agency eventually could be forced to make $400 million in payments.

"I am confident the federal government and Treasury Department will look at this issue and take action to ensure transit agencies across the country are not stripped of their ability to provide essential services," Metro General Manager John Catoe said Wednesday.