The board also adopted a fare and service plan which includes an average 9% increase in fares
NJ TRANSIT ADOPTS FISCAL YEAR 2016 OPERATING AND CAPITAL BUDGETS
NEWARK, NJ — The NJ TRANSIT Board of Directors today adopted a Fiscal Year 2016 (FY 2016) operating budget and capital program that supports continued investments in infrastructure and equipment to maintain the system in a state of good repair and enhance the overall customer experience.
The board also adopted a fare and service plan which includes an average 9% increase in fares, with no customer paying more than 9.4% after rounding, and modest changes for rail and bus service.
“NJ TRANSIT is moving forward with a balanced budget that reflects a laser-like look at individual business lines in order to maximize efficiencies and maintain a safe transportation system,” NJ TRANSIT Executive Director Veronique “Ronnie” Hakim, said. “As transit professionals, we owed our customers and stakeholders a good-faith effort to present them a solid plan that had the least impact on our riders. After much hard work, I am confident we delivered on that.”
The Board adopted a $2.116 billion operating budget and a $2.099 billion capital program for the fiscal year that started July 1, 2015.
Nearly half of the revenue in the FY 2016 operating budget comes from fares ($1.005 billion), supported by a comparable amount from state and federal program reimbursements ($961.8 million) with the balance from a combination of commercial revenues ($115.2 million) and state operating assistance ($33.2 million).
The capital program funds continued state-of-good-repair investments in transit stations and infrastructure supports an ongoing fleet modernization program and advances service reliability, safety and technology initiatives.
The FY 2016 operating budget reflects an increase of state funding along with a stable level of federal and other reimbursements, which will enable NJ TRANSIT to meet the agency’s projected expenses this fiscal year. Approximately 59 percent of the operating budget is dedicated to labor and fringe benefits costs. Other significant expenses include contracted transportation services, fuel and power and materials, which together comprise approximately 27 percent of the operating budget.
This year’s operating budget reflects a $76.7 million (8.3 percent) growth in passenger revenue, based on the fare adjustment and ridership trends. Overall passenger revenue and commercial revenue represents approximately 53 percent of the total FY 2016 operating program.
The FY 2016 capital program continues to prioritize investment in infrastructure to maintain an overall state of good repair, enhance safety and reliability, and improve the overall customer experience on the system.
The program continues to invest in upgrades to the Northeast Corridor (NEC),
the agency’s most utilized rail line. The NEC is allocated $61 million in FY 2016 as part of NJ TRANSIT’s ten-year, $1 billion Northeast Corridor investment program.
Highlights of the program include $82 million in rail station improvements: $27 million for Summit Station improvements, $14 million for Elizabeth Station enhancements, $6 million for Perth Amboy Station improvements and high-level platform construction, $4 million for Newark Penn Station upgrades, $4 million to reconstruct Lyndhurst Station to make it accessible to persons with disabilities and $2 million for New Brunswick Station improvements.
The program also supports continued investment in rolling stock renewal, with $87 million invested in rail rolling stock improvements and $40 million toward the purchase of new buses.
In addition, the program is undertaking approximately $913 million in major capital projects that will help advance NJ TRANSIT’s resiliency to extreme weather events.
Funding is also provided for technology and security upgrades, local programs, and rail, bus and light rail infrastructure improvements.
Approximately 42 percent of the capital budget comes from the Federal Transit Administration (FTA) Sandy Resiliency funds, with the balance coming from federal and other sources including 22% from the Transportation Trust Fund (TTF).
Fare and Service Adjustments
Throughout the past five years, NJ TRANSIT held the line on fare increases while maintaining high quality services and implementing new customer amenities including MyTix, Departurevision, and MyBus Now.
However, costs such as contract services – Access Link, the organization’s paratransit service, Hudson-Bergen Light Rail and private carriers – and workers’ compensation, general liability insurance, healthcare and benefits, and pensions have steadily risen. As a result, NJ TRANSIT was left with a significant budget gap.
Although NJ TRANSIT identified more than $40 million in reductions in overtime, fuel savings, energy and vehicle parts efficiencies, the agency still faced an approximate $56 million budget gap for the 2016 fiscal year. To close the gap, fare and service adjustments were proposed and now approved. The fare adjustment will go into effect on October 1st.