CTA 2013 budget

[Busjack]

I think what it get down to is The RTA doesn't want to lose the tax revenue for its bond.

If this tax revenue falls short.Something is going to hit somebody face or fan.

Well, that's true. There are all the statements about the CTA using "sales tax bonds" for various things, such as this ordinance stating "WHEREAS, The Authority anticipates the receipt from time to time from the Regional Transportation Authority (the "RTA") of amounts representing the Authority's share (in accordance with the Regional Transportation Authority Act, 70 Illinois Compiled Statutes 3615 (the "RTA Act"), including Section 4.03.3 thereof..." for "bonds for the purpose of: (i) financing the purchase of rail cars to replace existing cars," if there is insufficient money in the CTA's "Sales Tax Receipt Fund" to cover the bonds, then the stuff in the sock will hit the fan.

More than likely though, the sales tax will be dedicated to the bonds, thus meaning that fares have to be hiked, but the next relevant Budget Recommendations will blame it on something else.

[Busjack]

After being dormant for a month, the dispute over the CTA capital plan is coming up again before the RTA, according to this Tribune story.

[mkohut]

After being dormant for a month, the dispute over the CTA capital plan is coming up again before the RTA, according to this Tribune story.

The question is who has the upper hand.

If you look at the story of United Airlines and American airline along others not paying there fair share of taxes this problem wouldn't be happening.

[Busjack]

The question is who has the upper hand.

If you look at the story of United Airlines and American airline along others not paying there fair share of taxes this problem wouldn't be happening.

I don't know if the problem wouldn't happen, but at least there would be that much more sales tax revenue. And United and AA aren't the only ones doing it.

As to upper hand, it takes 12 of 16 votes to pass a budget (Sec. 4.01 of the RTA Act). Probably more relevant, 12 votes are needed to approve the annual capital improvement plan (Sec. 4.13).

The composition of the Board is 5 members appointed by the Mayor of Chicago, 1 by the Cook County Board President, 4 by suburban members of the Cook County Board, 5 consisting of 1 each by the collar counties, and 1 chairman appointed by the other members (Sec. 301).

Hence the 6 assumed city directors would have to somehow get the votes of 6 other members.* I noted with regard to the discretionary funds that the suburban and collar county ones have the power to hold it up against the 6 city members. While it was claimed that everyone got something a month late, the Pace November Minutes claim that Pace had to take out $800,000 the staff promised it.

So, I guess we will eventually have to see. Technically, only the CTA would be responsible on CTA bonds, but as we discussed last month, if sales tax receipts were not as expected, CTA would demand more money from somewhere and blame something else.

___________

*Addendum: Of course 10 directors would have to corral 2 city directors. Supposedly the theory was that one side couldn't shove something down the other side's throat.

[Busjack]

Tribune now says that the RTA has resolved this.

The first few paragraphs to that effect were grafted onto the preexisting story.

[mkohut]

The next question is who is going to be the leading agency on getting the companies to pay up on there taxes.

[Busjack]

The next question is who is going to be the leading agency on getting the companies to pay up on there taxes.

Obviously, from that article, the RTA, which is bringing the suit against United.*

However, it also appears that sales taxes would be due to Chicago and Cook County, assuming that the point of delivery is inside O'Hare. There might be an outside chance that the fuel depot is in DuPage county.

However, the RTA is the only one that collects the transit sales tax. The 3 service boards just spend the proceeds.

__________

*A claim would have to be brought in bankruptcy court against AA, which the article says the RTA won't do.

[mkohut]

Here is a more detail about the tax cheating companies.

http://www.suntimes.com/news/17617203-418/rta-attempts-to-lift-lid-on-alleged-tax-schemes.html

[Busjack]

A Tribune article based on the Finance Report presented at today's meeting indicates that the 2013 budget is out of whack, mainly due to lower pass sales, especially lower 7-day pass sales, after the fare increase.

Supposedly sales and real estate transfer tax increased revenue takes care of some of it, but it is hard to see how CTA will make it up in the 3 months mentioned by the CFO without fare hikes or service cuts.

[mkohut]

A Tribune article based on the Finance Report presented at today's meeting indicates that the 2013 budget is out of whack, mainly due to lower pass sales, especially lower 7-day pass sales, after the fare increase.

Supposedly sales and real estate transfer tax increased revenue takes care of some of it, but it is hard to see how CTA will make it up in the 3 months mentioned by the CFO without fare hikes or service cuts.

Maybe Claypool will learn from the same mistake as Metra on raising the price of passes.But,i doubt it.

[Busjack]

Maybe Claypool will learn from the same mistake as Metra on raising the price of passes.But,i doubt it.

I was going to bring up something like that, but it appears that the people at Metra who were concerned about it (primarily O'Halloran's press agent) are no longer there.

This is more of an issue of that CTA [usually] doesn't admit mistakes. After all, da Mare said that there wasn't a fare increase.

[jajuan]

A Tribune article based on the Finance Report presented at today's meeting indicates that the 2013 budget is out of whack, mainly due to lower pass sales, especially lower 7-day pass sales, after the fare increase.

Supposedly sales and real estate transfer tax increased revenue takes care of some of it, but it is hard to see how CTA will make it up in the 3 months mentioned by the CFO without fare hikes or service cuts.

Unfortunately it's the hikes in passes which we all know is a fare hike that got them into this mess to begin with, Well more accurately, it's the whole blunder in thinking passes would still be bought at the same rates that started the problem. And it may be hard to see how they get back in balance without further service cuts and and fare increases, but somebody has to start getting real that they can't always jump to those two solutions first thing as a means to get out of a hole. The fact that they've already turned to those two alternatives in stages since last December and they're still in the hole lends some form of credence that they can't keep going to those alternatives, especially if they're going to make grossly inaccurate forecasts into what passenger behavior will be after they implement those alternatives. I mean how much have they been trimming the fat in the central office especially after Tribune reports over the years that the headquarters bureaucracy had been growing for no good reason and due to no apparent need.

[Busjack]

Unfortunately it's the hikes in passes which we all know is a fare hike that got them into this mess to begin with, Well more accurately, it's the whole blunder in thinking passes would still be bought at the same rates that started the problem. And it may be hard to see how they get back in balance without further service cuts and and fare increases, but somebody has to start getting real that they can't always jump to those two solutions first thing as a means to get out of a hole. The fact that they've already turned to those two alternatives in stages since last December and they're still in the hole lends some form of credence that they can't keep going to those alternatives, especially if they're going to make grossly inaccurate forecasts into what passenger behavior will be after they implement those alternatives....

If those were the only blunders, both Metra and CTA made them. The essential blunder was that both justified it as "other transit agencies are doing it." If either were a real customer driven business (and neither is), it would have done consumer research to see if the consumers would accept this. At least Coke did the surveying when it determined that people preferred Pepsi, but not that Coke drinkers would not drink New Coke (that takes one back to the mid 80s).

They also have the gripe that the legislature cut the reduced fare subsidy without cutting the mandate.

... I mean how much have they been trimming the fat in the central office especially after Tribune reports over the years that the headquarters bureaucracy had been growing for no good reason and due to no apparent need.

I take this as a rhetorical question with the answer "they haven't." I suggested, for starters, that $654K could be cut out of the communications office, including $153K for its politically connected head spokesperson. Heck, a member of that staff could have saved whatever money was spent on reprographics for what his website says were replica destination signs and advertisements on the farewell 2200s trip. I know that the foamers here won't like me saying that, but that wasn't an original A Congress Milwaukee roller on that train, according to Garfield.

[mkohut]

You do have to ridership.It was down before the Dan Ryan project.

Considering the changes of Dec 16 of last year.That fell on death ears at meetings.

Which is another reason people don't have faith in the CTA.

[Busjack]

You do have to ridership.It was down before the Dan Ryan project.

Considering the changes of Dec 16 of last year.That fell on death ears at meetings.

Which is another reason people don't have faith in the CTA.

Probably "deaf" ears, but that does show that CTA is definitely not a customer driven business. Even where it does affect the budget.

[jajuan]

Probably "deaf" ears, but that does show that CTA is definitely not a customer driven business. Even where it does affect the budget.

And of course that gets to one major crux of why the service boards keep managing to fall on financial woes outside of being bastions of political patronage for city, suburban, state and just recently county execs, the fact that they don't operate as customer driven businesses. And the decrowd fiasco is one example that they don't even bother to make the pretense anymore like when they created the N5 to replace portions of owl service on the 67, 95E and the former 27 when owl service on those three was cut in 1992..

[BusHunter]

If those were the only blunders, both Metra and CTA made them. The essential blunder was that both justified it as "other transit agencies are doing it." If either were a real customer driven business (and neither is), it would have done consumer research to see if the consumers would accept this. At least Coke did the surveying when it determined that people preferred Pepsi, but not that Coke drinkers would not drink New Coke (that takes one back to the mid 80s).

They also have the gripe that the legislature cut the reduced fare subsidy without cutting the mandate.

I take this as a rhetorical question with the answer "they haven't." I suggested, for starters, that $654K could be cut out of the communications office, including $153K for its politically connected head spokesperson. Heck, a member of that staff could have saved whatever money was spent on reprographics for what his website says were replica destination signs and advertisements on the farewell 2200s trip. I know that the foamers here won't like me saying that, but that wasn't an original A Congress Milwaukee roller on that train, according to Garfield.

I knew something was up with those signs!! LOL!!

I hate to hear about possible service cuts again, because if that happens I know they'll be cutting service on the NW side. Former service cuts seem to be driving customers away from the #85A, #81W, #54A, #88 and the lack of newer buses is probably not helping matters. It's almost coming to the point of why even keep FG open anymore? But what's the other option raise fares again. What CTA really needs is a cash infusion from an alternate source. The city is going to reap millions off consumers over the installation of speed cameras coming soon near you. (if you travel to the city) Too bad the city couldn't share some of the proceeds to the CTA. It is a municipal function of the city. Maybe CTA needs to install it's own cameras, or fine offenders who damage it's property. With Ventra identifying all riders that may actually become a possibility some day.

[Busjack]

I knew something was up with those signs!! LOL!!

I hate to hear about possible service cuts again, because if that happens I know they'll be cutting service on the NW side. Former service cuts seem to be driving customers away from the #85A, #81W, #54A, #88 and the lack of newer buses is probably not helping matters. It's almost coming to the point of why even keep FG open anymore? But what's the other option raise fares again. What CTA really needs is a cash infusion from an alternate source. The city is going to reap millions off consumers over the installation of speed cameras coming soon near you. (if you travel to the city) Too bad the city couldn't share some of the proceeds to the CTA. It is a municipal function of the city. Maybe CTA needs to install it's own cameras, or fine offenders who damage it's property. With Ventra identifying all riders that may actually become a possibility some day.

As far as CTA installing its own cameras, it already has. The problem is that the vandals don't wear license plates, and hence have to be identified by some other means. London supposedly is satisfied with facial recognition software, which also helped identify the Tsarnaevs in a couple of days.

Unlike what Claypool said today, CTA is not a municipal function of the city. However, with TIF money going into stuff like the stations, and the city charging CTA when "its bus" is caught by a red light camera. there really isn't proper segregation of funds.

I repeat my advocacy of putting a video poker machine on each bus on the right front wheel well cover.

[BusHunter]

LOL!! We already have the dice games going on in the back of the bus. (not that CTA gets anything out of it)

Most vandals enter the system somewhere, maybe if they set up cameras at all the turnstiles then they know who everyone is. They can already do that with the buses.

Isn't it fascinating, they can gather all the funds for all new train cars and new buses yet they can't keep the service alive. Somewhere that is going to have to change or someday they won't have a system left to run.

[Busjack]

LOL!! We already have the dice games going on in the back of the bus. (not that CTA gets anything out of it)

Most vandals enter the system somewhere, maybe if they set up cameras at all the turnstiles then they know who everyone is. They can already do that with the buses.

Isn't it fascinating, they can gather all the funds for all new train cars and new buses yet they can't keep the service alive. Somewhere that is going to have to change or someday they won't have a system left to run.

The rapist at the Morse station was caught because he was on cameras on entering the Bryn Mawr station and cameras around the Morse station (according to the CTA Tattler). So if all the stations don't have them now, they will have them soon. Same with regard to cameras on the train cars.

The funding raises the curious question that while supposedly federal funds covered capital and sales tax covered operating, and there was the crying about operating borrowing from capital, now it seems reversed, especially on the CTA. There was stuff before, like the leaseback deals on the Green and Orange Lines and 6400 series buses, but that was accelerated in recent years with leasing the 150 DELFs from a Cerberus affiliate, and now all the borrowing secured by the "sales tax receipts fund," such as to finance the vast majority of the 5000s. That certainly seems to have accelerated under Claypool, such as for the 95th St. bus terminal project. See the CTA Press Release, on receiving a $20 million TIGER grant, and while it also mentions federal and state formula funds, also mentions a TIFIA loan* and CTA bonds, both of which CTA will have to repay.

Also, recall that the RTA didn't rubber stamp the 2013 CTA budget, but called in Claypool to explain how the debts were to be paid.

*TIFIA is explained by the FTA here.

[mkohut]

One has to wonder How serious the CTA was on the idea of nameing rights on the train stations.

If they did it some of the service can be restore.

Also,didn't we here with the last budget there wouldn't be any doomsday

[Busjack]

One has to wonder How serious the CTA was on the idea of nameing rights on the train stations.

If they did it some of the service can be restore.

Also,didn't we here with the last budget there wouldn't be any doomsday

As far as I know, they haven't said, other than the Apple station at North and Clybourn, which preceded that. I guess nobody has seen a Mrs. T's sign at Irving Park/Pulaski.

Given a link that was on the home page to a Tracy Swartz RedEye article on "vote for your grossest station," I wonder if there is a clean urine company that wants to sponsor a subway station, in case A Rod wants to use their services. Then you wouldn't really need to use a wrap; the product smells for itself.

Finally, they aren't going to call doomsday on $10 million. Rodriguez proved that it takes 8 to 10 times more than that.

[mkohut]

Heres the question of the day.

Why is Claypool now thinking of getting the Bonds refinace instead of doing it before there was a 10 million shortfall?

Isn't this the CFO job.

[Sam92]

Speaking of reduced service, more under the table cuts were snuck in for the August 25th pick.

- #N20 Madison Owl buses will no longer operate to Harlem/Lake and only between Washington/Stare and Austin in order to "better match ridership demand"

- #28 Stony Island will only operate on Hyde Park for Union Staion trips only; all other trips will resume operating on Lake Park to "match ridership demand on Hyde Park"

- #43 43rd will no longer operate to Stock Yards due to "low ridership to the Stock Yards"

- #85A North Central now ends a 1-1/2 hour at 9 pm to better " match customer demand"

- #88 Higgins will end 30 minutes earlier to "match customer demand"

Guess he thinks these under the table cuts are gonna be his key out. Just as he hit a brick wall and had a hard time with negotiating with the union to take care of his budget woes, his **** is gonna hit the fan with this as well. I doubt people in oak park are gonna take kindly to losing 24-hour service now that N20 no longer serves the green line. What's next? Scaling back N9, N60, and N62 from their nightly extensions as well isolating even more rail riders? Or maybe even ending N55 service to the MSI and instead operating between Garfield Green Line and St. Louis instead?

[Busjack]

Speaking of reduced service, more under the table cuts were snuck in for the August 25th pick.

- #N20 Madison Owl buses will no longer operate to Harlem/Lake and only between Washington/Stare and Austin in order to "better match ridership demand"...

.. I doubt people in oak park are gonna take kindly to losing 24-hour service now that N20 no longer serves the green line. What's next? Scaling back N9, N60, and N62 from their nightly extensions as well isolating even more rail riders? Or maybe even ending N55 service to the MSI and instead operating between Garfield Green Line and St. Louis instead?

• The N20 was extended to Harlem only because owl service ended on the Green Line. If, in fact, there isn't ridership demand at night in Oak Park, as demonstrated by the AVS passenger counter, then the passengers won't be harmed. This could be similar to the N201, which was to replace owl L service, and the bus drivers basically said that ridership was down to that you could use a van. Pace 309/313 stops at 10:30.
• Cutting N55 basically would mean that Hyde Park wouldn't have service. However, IIRC, 55 55th St-Museum to Morgan at the time it was connected to 6 Garfield and became the current 55 (1969) didn't run owl and certainly didn't run late evening past Morgan, even if it ran later east of there.

The other aside is that one wouldn't have seen this other than by clicking the "upcoming alerts" link, and then even at the bottom. Again, I don't know if these cuts are significant enough to require a meaningless public hearing, but apparently CTA doesn't think that they are.