CTA Overestimates Fare Collection Forecasts, Faces $10 Million Deficit

By Chuck Sudo in News on Aug 14, 2013 10:00PM

The first train at the newly rehabbed Jarvis Red Line station, December 2012. (Photo credit: Brad Perkins)

Fuzzy, overly optimistic math has CTA staring at a budget deficit this year that may approach $10 million. Tribune transportation reporter John Hilkevitch reports the deficit is a result of "wildly inaccurate revenue forecasts about the impact of increases in CTA pass prices."

CTA approved hikes hike in one-, three-, seven- and 30-day passes when they passed their budget last December. Yet revenue from fare pass sales were 2.5 percent less than expected during the first four months of 2013, with sales of seven-day passes, which spiked from $23 to $28, showing the sharpest drop in sales.

CTA budget records indicate revenue from fare passes are $39 below the agency's projections. A $6.9 million cut in reduced fare subsidies also contributed to this mess, which may have been catastrophic if not for an influx of $13.2 million in revenue through June from a sudden increase sales tax and real estate transfer tax revenue.

CTA is required to end the year with a balanced budget and their finance team is working feverishly to amend the budget. The agency has promised they will balance the budget without further fare hikes or cuts in service.