For the second time this year, the Chicago Transit Board amended the CTA's operating budget due to reductions in public funding imposed by the Regional Transportation Authority (RTA).

The Board approved an amendment to the budget to incorporate a new reduction of $35.2 million in public funding, which is in addition to a reduction of $154.7 million that the RTA required earlier this year. Through very careful control of the budget, the CTA projected that it will be able manage through this additional loss in funding and is not recommending service cuts or a fare increase to balance the budget.

When it set the CTA's funding marks last year, the RTA advised the CTA that it was expected to receive $723.3 million in subsidies for 2009. The CTA developed its budget based on that anticipated revenue; however, its public funding has been reduced by 25 percent, to $541.4 million, from the marks originally set by the RTA.

"The loss of 25% of our public funding has left the CTA with a razor thin margin for the remainder of the year. Fortunately, the CTA initiated efficiencies and cost control steps early and that has resulted in savings each month. We will use those savings to help make up for the most recent cuts to our funding," said CTA President Richard Rodriguez. "But it means we have nothing to turn to if there are further hits to our budget.  As it is, we have to aggressively manage to all our budget targets, for both costs and revenues, to get through the remainder of the year."

Rodriguez said that strong performance in both ridership and revenue in the first half of the year, coupled with strict cost controls enabled the CTA to balance the budget without implementing service reductions.

But with the continued weak economy, Rodriguez said the CTA cannot continue to expect ridership and revenue to perform better than budgeted, so the CTA has identified additional cost saving measures that include continued controls on labor costs, savings in materials and fuel, more efficient management of contracts, eliminating non essential travel and seminars, lower utility costs, and a reduction in the cost of equipment maintenance services due to the retirement of problematic buses and introduction of new buses.