CTA BOARD APPROVES 2002 BUDGET

November 15, 2001
11/15/01

The Chicago Transit Board, at its regular monthly meeting today, approved the proposed 2002 budget. The budget contains initiatives and projects that will advance the ongoing efforts to rebuild the CTA system, continue its commitment to customer service and improve transit services for customers.

At $914.8 million, the 2002 operating budget is 5.3% ($45.6 million) higher than this year's budget. Ridership and revenue are forecast to grow by 2.4% and 5.1% respectively, and public funding by 5.4% over 2001. The 2002 budget includes a Capital Improvement Plan of $495 million. These capital improvement projects include the ongoing rehabilitation of the Blue Line Cermak (Douglas) branch, the initial design phases of the Brown Line platform expansion project, the purchase of an automated bus announcement system, and continued efforts to modernize CTA bus and rail fleets and facilities.

The CTA projects a balanced budget as required by law. Public funding required for operations equals the funding mark of $441.6 million set by the Regional Transportation Authority, the agency responsible for financial oversight of the Chicago area's public transportation companies. The Recovery Ratio, which measures the amount of operating expenses the CTA has to fund from revenues it generates, is forecast at 52.0%, which matches the required ratio set by the RTA.

"I am pleased to approve this budget that is aimed at finding creative ways to do more with the resources we have available," said Chicago Transit Board Chairman Valerie B. Jarrett. "Years of fiscal discipline, innovative efficiencies and an aggressive effort to secure federal and state funding have allowed us to focus on improving the quality of the services we provide and increasing the number of customers who use our network of trains and buses, all without needing a fare increase for the past ten years."

CTA President Frank Kruesi said, "With this budget in place for next year, we can move forward with our ambitious agenda of projects and initiatives designed to improve our system, maintain our growth and continue our commitment to provide our customers with on-time, clean, safe and friendly service."

Illinois FIRST and the Transportation Equity Act for the 21st Century (TEA-21) provided the funding that has made the CTA's capital improvements possible. Managing the money the CTA now has and securing adequate funding in the future are the main financial challenges the CTA faces in the years ahead.

"Thanks to the leadership of Mayor Richard M. Daley, Governor George Ryan, House Speaker J. Dennis Hastert and the entire Illinois Congressional delegation and the Illinois General Assembly, the CTA has been able to obtain essential funding to improve our system," said President Kruesi.

In addition to keeping fares at the same levels they have been for a decade, the budget will fund initiatives that carry on CTA's mission to deliver quality, affordable transit services. Among these are the $482 million Cermak (Douglas) Blue Line rehabilitation project, the final design phase of the Brown Line platform extension project and continuing efforts to secure a Full Funding Grant Agreement with the federal government for the Brown Line project.

Rail improvements will be made to railcars, switches, signals and crossings. Security will be enhanced through a pilot program to place cameras on platforms. The cameras can also monitor ridership levels.

Given recent events, the CTA is also operating in an environment of heightened security. The CTA must identify those challenges and prepare for them. The CTA, like other public entities, must remain vigilant and continually monitor its procedures and facilities. As analyses indicate a need to modify the agency's current security coverage, the CTA will make necessary adjustments.

The bus fleet modernization will continue as TMC buses that were retrofitted with air conditioning this summer continue to be overhauled and have engine pre-heaters installed to increase reliability. By year-end 2002, all 469 new NOVA buses should be in service and the first new NABI articulated buses are scheduled for delivery. In addition, an on-board, automated bus announcement system similar to the one in use on CTA trains will be purchased in 2002. New bus fareboxes will also be purchased next year.

The CTA has gone from having funding for only 19% of its capital needs in 1998 to funding approximately 70% of those needs in 2000. However, even with all of these ambitious initiatives and projects, long-term capital funding remains a challenge. The CTA estimates that it needs $4.3 billion over the next five years to bring its entire system into a state of good repair, and at least twice that amount to completely renew the system. Despite the CTA's recent success in acquiring state and federal capital funds, the agency is still faced with a sizeable list of unmet capital needs. The CTA is projecting receipt of $2.9 billion in capital funds, leaving a funding gap of $1.4 billion through 2006.

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