Chicago Transit Board Cancels Service Cuts, Fare Increases and Layoffs for 2005

July 13, 2005

As a result of the Regional Transportation Authority's (RTA) decision in June to appropriate the full amount of a $54.3 million grant from the Illinois Department of Transportation (IDOT) to CTA, the Chicago Transit Board today voted to officially cancel 2005 service cuts, fare increases and layoffs planned to go into effect July 17.

'state lawmakers, the RTA Board and its Chairman Jim Reilly have all clearly demonstrated their support for public transit by providing additional funding for the year," said Chicago Transit Board Chairman Carole Brown. ?We are fortunate that our customers, our employees and the region's economy will not suffer from service cuts in 2005."

The grant provided by the state legislature is structured to provide a temporary funding solution to CTA for 2005. Long-term, stable transit funding increases are still necessary to avoid future budget shortfalls that result from a structural problem with the way transit is funded in this region. CTA officials will continue to work with members of the General Assembly to secure sufficient funding for public transit in the future.

?Despite the strain the possibility of service cuts, layoffs and fare increases placed on our customers and employees, CTA ridership posted healthy increases throughout the first five months of 2005," said CTA President Frank Kruesi. ?The fact that ridership increased despite adverse circumstances is a clear message that there is a real demand for public transit in the city and the suburbs. While we can all breathe a sigh of relief over funding for 2005, we cannot forget that without a change in the way transit is funded, we will face the same scenario next year."

With the grant from the state, CTA will now be able to balance its budget for 2005 and maintain its current level of service. The CTA is in the process of preparing a budget proposal for 2006. If a solution to the regional public transit funding issue has not been resolved, CTA will again face a budget shortfall in 2006. The proposed budget will then include measures to cover any anticipated shortfall.

As a current budget initiative, the CTA has been working with a professional consulting firm, AECOM Consult, to identify additional cost efficiency measures. Since 1997, CTA has reduced operating costs by over $760 million, including the reduction of more than 1,100 positions while increasing both bus and rail service. The consulting firm has been reviewing operations throughout the CTA to determine what other cost-savings can be achieved.

Although AECOM has not yet finalized its recommendations, it gave a presentation to the Board today to provide an update on the review and a general outline of some of the areas in which they think the CTA could either achieve additional savings or increase revenue. The Board approved resolutions in support of the AECOM suggestions and authorized management to further pursue savings or revenue enhancements in these areas.

?As we begin to develop next year's budget, we know that we will still face serious financial challenges. The Board supports the efforts to reduce costs and increase revenues. Although efficiencies alone won?t solve our budget problems, we have to continue to be vigilant and make sure that we are taking advantage of opportunities to improve our efficiency," said Chicago Transit Board Chairman Carole Brown.

AECOM Consult, a DMJM+Harris Affiliate, undertakes many transportation planning assignments for federal, state and local agencies. These assignments focus on a broad range of technology options to address transportation problems in major metropolitan areas, intercity corridors and statewide efforts.

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