CLEVELAND -- The Greater Cleveland Regional Transit Authority (RTA) is studying the possibility of increasing fares in 2016. However, no fares will be increased until after the public hearings are held in February or March. After that time, staff will consider all comments and make a final recommendation to the Board. If approved, a fare increase would take effect in fall 2016.
“It takes $700,000 to operate RTA for one day,” said RTA CEO and General Manager Joe Calabrese. “If the year-end operating reserve drops to $6 million – as it may in 2016 -- it would mean we have only 9 days of operating money left. That would not be a very strong position for us.”
Bond markets watch that number very closely, he said.
”Because we have a stable financial condition, we can borrow money at lower rates and save taxpayers millions of dollars in interest payments,” Calabrese said.
“The amount of our year-end balance peaked in 2013 and has been shrinking every year – from $38 million in 2013, to $27 million in 2014, to $25 million in 2015. That’s a downward spiral that we cannot ignore.”
“Our projected year-end operating reserve in 2016 is $6 million. By closely monitoring expenses, and raising fares, we hope to raise that operating reserve to $15 million by the end of year. However, even that number fails to meet our goal of a one-month operating reserve of $21 million,” Calabrese said.
While the cost of most products or services go up annually, RTA fares are typically increased only every 6 years or so. Fares have not been increased since 2009. If fares are increased, it would be the first increase in seven years.
What would be considered at public hearings
- Increase regular fares by 25 cents, from $2.25 to $2.50.
- This is about 1.5 percent per year for the last 7 years. The cost-of-living has increased more than 2 percent annually.
- Adjust fares related to the Americans with Disabilities Act (ADA) for ADA customers using Paratransit service:
- Paratransit fares are allowed to be double that of fixed-route service, according to Federal ADA rules, but RTA has typically charged the same fare for both. The proposed fare increase is $1.25 for customers using Paratransit. The current Paratransit fare of $2.25 would go to $3.50.
- The cost for RTA to provide a Paratransit ride is approximately $40.
- Adjust fares for ADA customers who ride fixed-route services. Currently they ride free, but with this proposal, they would pay the Senior/Disabled fare of 50 percent of the adult regular fare, or $1.25.
- Reduce bus service hours and bus service miles by 4 percent among poorly performing routes. This would mean a reduction of .8 percent in 2016, and more in 2017.
If adopted by the Board, these proposals would generate an estimated $1.3 million in 2016, and $3.1 million in 2017.
If fares are not increased, RTA would have to consider further reducing services. Over the past 7 years:
- The cost-of-living has increased by more than 2 percent annually.
- Social Security payments have been adjusted for the cost-of-living each year.
- Downtown parking rates have increased by 32 percent since 2009.
- The State’s investment in public transit has been reduced by $10 million since 2009. Ohio provides less than 1 percent of the funding needed for RTA.
- Federal investment in RTA has been reduced.