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Claypool: CTA faces $277M in red ink for 2012

CTA president Forrest Claypool attempted to prepare transit riders on Tuesday for seemingly unavoidable fare increases and service cuts as early as JanuaryÖ by explaining the roots of a financial crisis that has culminated in a near-record budget deficit projected at $277 million for next year.

But Claypool stopped short of committing to any specific strategies to close the budget gap, drawing ire from a top official at the Regional Transportation Authority who blasted the CTA for missing a Sept. 30 deadline to submit a 2012 proposed budget.

Metra, which is planning to raise fares by an average of almost 28 percent next year, and Pace, which won’t raise fares, provided their budget books on time, according to the RTA.

“It is certainly disheartening that the CTA is late because the RTA needs to take a regional view on how the three transit budgets will affect riders who use multiple transit systems,’’ said Jordan Matyas, RTA deputy executive director. “When you are talking about fare increases, a CTA fare increase could affect a fare increase at Metra.’’

Claypool said CTA staff is “looking deep into our own bureaucracy” to find internal cost savings, on top of the $25 million in cuts announced a few months ago affecting senior management positions, before deciding on fare hikes and service reductions.

The CTA’s 2012 budget is still “several weeks’’ away from being presented, he said.

The CTA has made cuts on an annual basis, as well as periodically trimmed service and raised fares, to balance its budget. The $277 million deficit for next year is more than twice as large as the $95.6 million deficit in 2011, but smaller than the $300 million deficit in 2010.

Regarding a fare increase, “Everything is a balancing act,’’ Claypool said. “There should be a shared cost between the (transit) users and the taxpayers.’’

The CTA last raised fares in 2009 and slashed service in 2010 -- scaling back bus service by 18 percentÖ and rail service by 9 percent.

Claypool came out firing in an address Tuesday morning to the City Club of Chicago. He blamed CTA labor unions for pushing “archaic work rules” – all agreed to by his predecessors – “that are so destructive and cost so much money for the people who ride our system.’’

The CTA has been forced to borrow $554 million over the last four years to cover deficit spending and shortfalls, Claypool said. The agency’s legal borrowing limit has been reached, he added. The CTA also shifted $113 million from its capital-improvement budget this year to shore up the $1.35 billion operating budget, which had faced a $95.6 million shortfall.

“There is no one left to borrow from. It is not responsible to borrow any longer. We have to make the hard financial decisions to balance the budget,’’ Claypool said.

Claypool even took a swipe at Amtrak, perhaps unaware that Amtrak’s cost-recovery performance on some routes is much better than the CTA’s.  

“The CTA provides more rides in two days than Amtrak provides nationally in a year,’’ Claypool told the City Club crowd.

CTA operating costs and other expenses are projected to increase by $81 million next year, “driven by the types of gold-plated union collective-bargaining agreements we have, and the benefits and the pension obligations and health care,’’ he said.

Meanwhile, revenues will plunge by $196 million, leading to the $277 million($196M +$81M) budget deficit, he said.

Union officials said the rank and file are not to blame for the CTA’s cost structure being too high. The CTA contract with the Amalgamated Transit Union expires Dec. 31.

“We know CTA management wants flexibility to bring in non-union workers to do certain jobs. That doesn’t help us at all. I still have 34 people laid off from February 2010,’’ said Robert Kelly, president of ATU Local 308, which represents rail workers.

Claypool cited a Tribune article published Tuesday that documented how the CTA has seriously delayed its customers by cancelling hundreds of bus and train runs this year because too many transit employees fail to show up for work regularly. The CTA is spending $40 million in 2011 to staff hundreds of extra workers every day to fill in for employees who call in sick, he said.

In addition, Claypool pointed out that CTA bus drivers and train operators are the highest paid (top wage $29.65 an hour) among U.S. transit systems, based on cost-of-living adjustments. He lamented that the CTA pays rail janitors up to $44.30 an hour in salary and benefits, while private janitorial firms at O’Hare International Airport pay their workers $18.58 an hour.

The average union salary at the CTA is $59,000 a year, Kelly said. “Is that what is breaking the budget here? No. The lives of middle-class working people are in the hands of politicians and they think it’s a joke,’’ he said.

jhilkevitch@tribune.com

Copyright © 2015, RedEye
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