Ayako Mie/OAKLAND
Amid the historical budget cuts in California, AC Transit is bracing for further budget shortfalls. It is examining whether service cuts and fare hikes might be necessary to balance their budget.
At the center of Wednesday’s meetings in Oakland was Gov. Arnold Schwarzenegger’s state budget cuts, and how they would affect the transit agency’s budget. Some board members showed irritation, anticipating that the agency would lose a lot of money.
“ I feel really uncomfortable to talk about the budget when we do not have the financial projection now,” said AC Transit Board Director Greg Harper, encouraging staff members to expedite the analysis for the fiscal year. Vice Chairperson Rebecca Kaplan agreed. “We should do something before it is too late,” she said. General Manager Rick Fernandez said there are many factors they do not know, and that they will have a better projection in December. With consumer confidence going down, AC Transit is anticipating much less sales tax revenue, the source of its funding.
Gov. Schwarzenegger cut $100 million from the state transit program in September, worsening the already looming budget deficit for California’s public transportation system. AC Transit is among the hardest hit, having lost $19 million this year. Now Gov. Schwarzenegger is eying State Transit Assistance funds for transit operations, which comes from the revenue on gas tax.
“We have 12 million we could lose this year,” Fernandez said. AC Transit received only 7 out of 26 million dollars, which they were supposed to receive this year.
With the passage of Measure VV, a $96 parcel tax, AC Transit will receive $14 million a year. However, that money alone cannot help the worsening economic situation of the transit system, if the governor decides to axe the STA fund.
“He is looking to take that [the 7 million dollars] back,” Fernandez said. “Next year, it could be 20-25 million dollars that we could lose. This is significant.”
Fernandez added that service cuts are “a strong possibility.” He also said that his staff is working on recommendations for a fare raise, which, at $1.75, is already the highest in the Bay Area public transportation system.
Staff members are working to alleviate the negative impacts, by getting whatever the money they can. The Board members gave the go-ahead to apply for the Public Transportation Modernization, Improvement, and Service Enhancement Program Account fund for capital improvements. AC Transit is planning to use the money to replace old buses with up to 45 new ones.
“ It will help the cash flow, because the money will be pooled until the buses get delivered,” said AC Transit Capital Planning Manager Kate Miller. However, the effect will be a temporary one, because once buses get delivered, AC Transit will have to pay the full amount.
AC Transit is also planning to reach out to the public and petition in Sacramento. “ We will convene meetings as soon as possible and ask the governor not to take away STA funds,” said Assistant General Manager Mary King.
The Board of Directors will meet on December 5th to discuss further about the budget for the coming fiscal year.
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