CTA CHAIR and RTA REACH AGREEMENT ON FUNDING LEVELS

September 10, 2004
09/10/04

CTA CHAIR and RTA REACH AGREEMENT ON FUNDING LEVELS

RTA Budget Requires General Assembly Action to Avoid Service Cuts

At today's Regional Transportation Authority (RTA) Board meeting, the RTA Board passed operating and capital funding marks that, if supported by the General Assembly, will allow Metra, CTA and Pace to maintain or improve current service levels. Carole Brown, Chicago Transit Board Chairman and RTA Board member, thanked the RTA for adopting this budget amendment that incorporates changes proposed by Brown at last week's meeting.

The new budget amendment, introduced by Board member Dwight Magalis, increases 2005 operating funding marks over last year's levels, protects capital projects currently underway throughout the region, and provides a clear target for members of the General Assembly as they review how transportation is funded in Northeastern Illinois. The amendment also directs Metra and Pace to follow the CTA's lead in developing two versions of their 2005 budgets ? one that maintains service levels with additional state funding for transit as called for in the RTA's proposed budget, and one that does not.

"This budget amendment is a strong statement in favor of public transportation and it recognizes the need for additional operating funds," said Brown. ?But perhaps most significant is that it was developed and approved through a bipartisan, regional effort. It shows a growing recognition of the need for the General Assembly to take up the issue of transit funding this fall."

Brown and four other RTA board members had opposed the original funding proposal prepared by RTA staff because it failed to address the steady erosion in CTA's share of public operating funds and it instead proposed an unworkable transfer of capital funds to operations. Brown and the CTA considered this a financially unsound proposal. The CTA does not have sufficient capital funds to transfer. Doing so would jeopardize needed improvement projects and put federal funding at risk. The budget amendment allows capital transfers, but does not require them.

CTA executives have dedicated a substantial amount of time and effort recently to draw attention to a funding crisis facing CTA and the region's transit providers caused by structural flaws in the formula used to set funding levels. Since 1985,the inflation-adjusted amount of public funding to operate the region's trains and buses has fallen and CTA has been the hardest hit. Adjusted for inflation, CTA received about $397 million in 2004 for bus and rail operations compared to $491 million in 1985. In response, CTA has cut annual costs by over $100 million. Despite these efforts, in 2005, CTA faces a $75 million operating funding shortfall that is forecast to become a $385 million shortfall by 2014 unless the Illinois General Assembly takes action.

Added Ms. Brown, "There are serious structural flaws in the way transit is currently funded. Without General Assembly action this fall, the CTA will be forced to cut transit service, which will increase congestion and hurt the region's economy. As was reported in the news earlier this week, the average driver in the Chicago area already spends 56 hours stuck in traffic--draining $4.2 billion from our economy. Transit cuts will only worsen that problem. It is in the best interest of drivers, business owners and transit customers, that we have a strong, well-funded regional transit system."

Recognizing that circumstances change over time, Congress re-examines its transportation funding formula every six years. However, Illinois last evaluated how transit is funded in 1983, more than 20 years ago when the regional demand for public transit was quite different than today.

The CTA provides over 80 percent of all transit trips in the six-county region, including nearly half of suburban transit trips, but only receives 59 percent of regional public transit funding. In 1980, CTA received 71 percent of available transit funding. The current transit funding formula is designed around geographic boundaries and retail sales and does not reflect ridership, service levels and other performance-based criteria.

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