Crain's: State deal would avoid CTA fare hike

Greg Hinz is reporting on his Crain's Chicago Business blog tonight that the state and CTA have struck a deal for enough additional operating cash to avoid fare hikes. However, the $90 million in service cuts would proceed. From the report:

According to reliable sources, the deal involves the Regional
Transportation Authority issuing bonds for capital projects that would
be funneled to the CTA.  That would allow the CTA to shift some federal
capital funds into its cash-short operating budget, thereby avoiding
the necessity to hike fares.

As part of the deal, the state
reportedly would help the CTA pay debt service on the RTA funds for at
least a couple of years.  Other monies would go to Pace, which has had
trouble financing its para-transit operation.

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  • Yeah nice - all the comments confirm that this is just one of those 'we won't raise fares in an election year' ploys. Again no fundamentals about the budget are being changed here so just after the 2010 election we'll be threatened again. This is worse than the third world, is that what we are aligning ourselves with?

  • Based on your "election year" reasoning, it's unlikely there would be a fare increase just after the 2010 elections because 2011 are the Chicago mayoral and aldermanic elections.

  • In reply to Joe001:

    I'm trying to make this more upbeat so perhaps in 2010, for 2011 budget, there will be no issues because other funding will come through because the economy will swing back but I'm still leery of announcements that effectively change nothing. How is what he plans to announce today going to help the long term problems tied to CTA funding? Was it really ever a question in anyone's mind that Quinn would let fares go up before he was elected? CTA and Unions played chicken and the state flinched. Next year, CTA (and Unions) will flinch - and so on.

  • In reply to Joe001:

    If the State's really going to offer to help pay-off the bonds, that's new state money into transit--not a bad thing. BUt if they don't help pay for it all, then this is essentially, the State loaning CTA it's future years worth of sales tax receipts. Which isn't a bad thing, in the sense that it takes the cyclicalness (sic?) out of the sales tax revenue stream. BUT, that means, essentially, that if there is a sales tax recovery, those future revenues don't balance future CTA budgets, they go to pay-off 2010's budget. Long story short, 2010 may be "saved," but once again, the problem is put-off an actually madee worse. Mayor Daley should NOT agree to this unless he has all the numbers laid out for him. He's running for re-election next year and he shouldn't want to have another CTA budget crisis on his plate next year.

  • In reply to Joe001:

    I just think it's funny that anyone thinks the "economy" is going to recover ANY time soon. Soon...yeah...if you think 2015 is soon. It's only going to get worse next year.

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