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Posted: Wednesday, 15 July 2009 1:23PM
CTA says no service cuts or fare increases despite funding cuts
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CHICAGO (STNG) -- The Chicago Transit Board says that despite funding cuts of just under $190 million this year, the CTA will not have to cut service or increase fares.
The board on Wednesday approved an amendment to the budget to incorporate a new reduction of $35.2 million in public funding. It is the second time this year the board has amended the CTA budget, according to a release from the agency. Earlier this year the Regional Transportation Authority imposed a reduction of $154.7 million.
The release says through careful control of the budget, it should be able to manage the additional loss in funding and the board is not recommending service cuts or a fare increase to balance the budget.
“The CTA was conservative in its budgeting this year and staff has diligently controlled costs," board chairman Carole Brown said. "But let’s be clear, there is no margin for error going forward. In order to get through the rest of the year, we have to aggressively monitor costs and we have to hope there are no unanticipated costs or further funding reductions.”
When it set CTA funding marks last year, the RTA advised the agency it was expected to receive $723.3 million in subsidies for 2009, the release said. The CTA developed its budget based on that arevenue, but the public funding has been reduced by 25 percent to $541.4 million.
“The loss of 25 percent of our public funding has left the CTA with a razor thin margin for the remainder of the year," CTA President Richard Rodriguez said. "Fortunately, the CTA initiated efficiencies and cost control steps early and that has resulted in savings each month. ... But it means we have nothing to turn to if there are further hits to our budget."
Rodriguez said that strong performance in both ridership and revenue in the first half of the year, coupled with strict cost controls enabled the CTA to balance the budget without implementing service reductions. But with the continued weak economy, he said the CTA cannot continue to expect ridership and revenue to perform better than budgeted.
So the agendy identified additional cost saving measures that include continued controls on labor costs, savings in materials and fuel, more efficient management of contracts, eliminating non-essential travel and seminars, lower utility costs and a reduction in the cost of equipment maintenance services due to the retirement of problematic buses and introduction of new ones, the release said.
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Copyright 2009 STNG Wire, The Chicago Sun-Times. All rights reserved.This material may not be published, broadcast, rewritten, or redistributed.
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