Metra’s Board of Directors today approved a 2015 budget and capital program that includes an average fare increase of 10.8 percent across all fare types to help fund a modernization plan as well as the increasing costs associated with operating commuter rail service.
The decision to raise fares in 2015 was made after Metra took multiple steps to contain costs. In recent years, Metra identified $5.9 million in efficiencies that are still positively impacting Metra’s current budget and will continue to reduce costs in 2015. For example, a renegotiated agreement with the South Shore Line reduced Metra costs by $2.3 million in 2015. Metra has also implemented further efficiencies that will reduce its operating costs for 2015 by $7.8 million, including $3.3 million in savings in maintenance costs, $3.8 million in employee health care cost savings and $700,000 in security cost reductions.
“We are continuously looking for ways to run this agency as effectively and efficiently as possible,” said Metra Board Chairman Martin J. Oberman. “But the simple fact is that cost containment can only go so far. Through this budget, Metra is demonstrating that it is spending the dollars necessary to maintain service and taking the steps necessary to invest in its future.”
Nevertheless, as the Board unanimously passed the budget 11-0, it included an amendment directing staff to prepare a detailed report by January 2015 outlining whether additional costs can be cut without reducing or eliminating service.
Metra’s 2015 budget includes $753.1 million for operations and $328.9 million for capital needs. Public hearings regarding Metra’s spending plans and its plans to finance a modernization of its rail fleet were held across the region earlier in November in advance of the Board’s vote.
A portion of the fare increase will be used to cover debt service on a bond issue of $100 million, which would be the first in Metra history, or similar financing. The financing, combined with additional financing proposed for future years, will be used to help fund a $2.4 billion modernization plan. The rest of the fare increase will be used primarily to cover a growth in expenses, outlined below.
Metra’s budget projects expenses to grow by $51.5 million in 2015. That includes $18.5 million for labor and fringe benefits, $6 million in added maintenance expenses due to the age of its equipment, $9.6 million in other expense growth, $8.4 million for the financing proposal and $3 million for the added costs to our operating budget for the federally mandated Positive Train Control system. It also includes a $6 million increase in the amount of farebox revenue that Metra is setting aside for capital needs.
The 2015 budget includes an increase in funding from external sources of $18 million. This includes a $12.3 million increase regional transportation sales tax receipts, $6 million from the RTA and a $700,000 increase in the state reduced fare subsidy, minus $1 million in security grant funding. The deficit is further reduced by $6.2 million from an accounting change, a projected increase in non-fare revenue and grants from the RTA’s Innovation, Coordination and Enhancement program.
That leaves a $27.3 million gap between costs and projections for available funding. This shortfall will be funded through the fare increase.
The price of full-fare, one-way tickets will increase between 10.8 and 18.2 percent, depending on the zone. Full-fare 10-ride tickets will change from a reduction of 0.3 percent to an increase of 6.4 percent. Full-fare monthly passes will increase between 10.9 percent and 18.6 percent. The price of reduced-fare, one-way tickets will increase between 11.1 and 22.3 percent, depending on the zone. Reduced-fare 10-ride tickets will increase between 0 and 10 percent. Reduced-fare monthly passes will increase between 11.1 percent and 22.2 percent. (Please see fare charts.)
The capital budget includes $156.6 million in federal formula capital funds, $4 million in federal Congestion Mitigation & Air Quality funds, $45 million in RTA State of Good Repair bond funds, $13.3 million from the RTA Innovation, Coordination and Enhancement program, $10 million in Metra farebox capital funds and $100 million in Metra bonds or similar financing.
The capital budget will allocate $92 million to rolling stock, $36.9 million to tracks and structure, $131.6 million for signal, electrical and communication work (including $123 million for PTC), $44.5 million for facilities and equipment, $9.4 million to stations and parking and $14.5 million to support activities.
As part of the 2015 budget proposal, Metra would restore a discount on 10-ride tickets that was eliminated in 2013. The 10-ride ticket would now be priced at the cost of nine one-way fares, instead of the current 10 one-way fares. All the changes, including the fare increase, would begin Feb. 1, 2015.
Other fare policy changes include:
- The grace period on monthly tickets will be restored, so that they will be valid on the first business day of the following month until noon.
- One-way tickets will be good for 90 days, instead of the current 14.
- The extra charge for buying a ticket onboard the train will increase to $5 from $3 (The surcharge is not applied if no ticket agent is available at the boarding station.)
- The price of a weekend pass will increase to $8 from $7.
A general no refund policy will be adopted, but exceptions could be outlined in the future.