2006 Budget

On November 9^th the CTA Board approved its 2006 budget. You can read more details here and here but I thought I would highlight several changes here.

Capital

First, we are using $30 million in capital funds for operations. That’s bad policy, and it’s not sustainable, but state officials have asked for more time to put together a funding solution.

State officials have also said that they will make sure we have all of the matching funds necessary to claim every federal dollar available to us. Because of that commitment, we should not let the transfer of capital to operations delay important multi-year projects. I asked staff last month to look for creative ways to restructure and accelerate our capital financing. As a result, the 2006 Capital Budget before us today is $36 million higher than originally presented.

These additional funds will allow us to accelerate our bus and railcar procurements, which will improve service and reduce operating and maintenance costs. We have also set aside $6 million to begin the planning and community outreach for the Red, Orange, and Yellow Line extensions, and to conduct service improvement studies throughout the entire service area – from new corridor studies to rail infill stations.

The bottom line is this – the Chicago region needs more and better transit. Our Congressional delegation agrees, and we will be working hard over the coming months to build broad public support and understanding for our vision of an even better transportation network.

Service

I am very pleased that this budget includes funding to implement West Side and West Suburban service improvements based on many months of community outreach and detailed planning. It is important to pursue continuous improvement in our service. We have had great success in the Lake Shore corridors, and I look forward to working with the community to finalize these service recommendations by early 2006.

Fares

By shifting away from cash fares, we will speed-up boarding, enhance service and reduce our cash handling costs.

This fare ordinance applies the two-dollar cash fare to everybody. We heard some concerns from customers about exempting the Rush Shuttle buses from that policy, and so those fares will increase from $1 cash to $2 cash. However, those customers can use Transit Cards for $1.75 or Chicago Cards for an additional 10% discount. We still want to encourage regional transfers. CTA is working with RTA, Metra, and Pace to integrate the Chicago Card with the existing Link-Up program.

The board took no action on paratransit fares. Paratransit costs CTA more than $25 per trip, and last year the board scheduled an increase from $1.75 to $3.50 for January 2005. That increase was delayed, and on June 9^th the board scheduled the increase for January 1, 2006. Pace already charges its paratransit customers double the base fare. Moreover, new state legislation sets a target that 12 percent of paratransit costs should be covered by customer fares. At the $1.75 fare, CTA recovers just 6 percent of its costs.

Although CTA’s funding problem has not been resolved, the cash fare increase, cost efficiency initiatives and interim transfer of capital funds to operating will enable the CTA to get through 2006 with a balanced budget and provide time for state officials to work on funding for the region’s public transit.