November 16, 2011

Chicago Transit approves budget, new fare system

The Chicago Transit Authority's (CTA) board approved a $1.24 billion budget for 2012 that holds the line on fares and maintains current service levels, relying on deep management cuts and work rule changes from labor unions. The proposed budget is $66.2 million — or 5.1% — less than the 2011 budget.

Management initiatives will help reduce the existing $277 million deficit by $117 million and the proposed budget will close the remaining gap with anticipated work rule changes, health care reform and restraint in wage growth consistent with other metropolitan transit agencies.

The CTA has borrowed a combined $554 million since the start of the recession in 2008, and implemented a fare hike in 2009 along with deep service cuts in 2010. Despite these actions, the CTA faces escalating costs that far exceed other big city transit agencies.

The CTA's board also approved an agreement to implement a new, open standards based fare-collection system that will benefit customers, improve operations and save money, according to the authority.

The board approved a contract to convert the CTA's current proprietary-fare system to an open fare system, using contactless cards that use both financial and information security industry "open standards" technology. CTA patrons will simply "tap" their contactless credit, debit and bank cards, or CTA-branded prepaid cards on a card reader to board trains and buses. The change in technology, expected to be implemented in early 2014, will modernize and streamline CTA's current fare-collection systems.

The CTA awarded the $454 million contract to Cubic Transportation Systems. Cubic was chosen through a vigorous, two-year RFP process after submitting the lowest responsive bid for the system.

The contractor will provide all of the fare-collection equipment, maintenance and support, and CTA will pay the cost via a base fee and a per tap transaction fee from revenue on a monthly basis.

The new system standards could serve as a basis for a universal fare system among CTA, Metra and Pace. State legislation passed in 2011 mandates a universal fare system by 2015.

 

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