Riding the bus, worrying about transit deficit, fare hikes

Sevcik was one of several witnesses testifying to the urgent need to support existing public transit at a Senate Transit Subdivision hearing March 4 at the Hennepin County Government Center. Approximately 100 people attended, including only three legislators, Sen. Scott Dibble (D-Minneapolis) the subdivision chair and Sen. Jim Carlson (D-Eagan) and Rep. Frank Hornstein (D-Minneapolis), who is not on the committee.

The Metropolitan Council’s regional transit system faces a $62.3 million budget deficit next biennium, leaving it roughly eight percent short, according to newly released estimates. That’s a $17 million deficit increase since a November estimate.

Options to fix the shortfall include fare hikes, services cuts or new subsidies. Despite the grim economic picture, it appears that new subsidies—the stimulus package, use of reserves and other short-term fixes—could minimize the impact on transit riders, at least for the near future.

Catch 22

The Metropolitan Council will be reluctant to make significant service cuts in part because they would create a Catch-22. If the Council can’t maintain basic services, Chair Peter Bell said, the federal government is unlikely to continue funding major new transit expansions such as the Central Corridor light rail line. The Council has invested considerable time and effort into that project.

“Certainly you can do modest trims,” Bell said regarding service cuts. “I would not take a fare increase or some route reductions off the table. It is lower in our priority list.”

If fare hikes are part of the solution, they are only a piece. The 25 cent-a-ride fare increase added last October is projected to raise $7 million a year. Another 25-cent increase could negatively affect ridership. Even if a fare increase raised another $7 million a year ($14 million for the biennium) that’s less than one quarter of the projected deficit.

The stimulus package could help. The Metropolitan Council expects to get around $67 million for transit, Bell said. The stimulus money is intended for capital projects and job creation, but Bell estimated that some of it—between $15 million to $20 million a year—could bolster operations. That would be enough to deal with between half and two-thirds of the deficit.

As Bell said in a Feb. 19 State of the Region address: “My No. 1, 2 and 3 priorities will be using any federal transit stimulus dollars for operating costs rather than capital costs. It makes no economic sense to build what you can’t afford to operate. Nor does it help the economy to hire a construction worker if it means laying off a bus driver.”

Advocates, riders line up

In 2008, Metro Transit ridership hit nearly 82 million, a 27-year high.

Behind the budget and ridership numbers are stories of people who depend on transit.

Some of the riders who testified said they took transit by choice to reduce their environmental impact; others were poor or disabled and had no other option to get around.

Susan Stellmacher lives in north Minneapolis in Kingsley Commons, affordable housing for people with multiple sclerosis, a chronic, disabling disease. She became a regular Metro Mobility rider in December 2006. “I use Metro for all my transportation, doctor appointments, grocery shopping and I furthered my volunteering,” she said. “Virtually every one of us at Kingsley Commons relies on Metro Mobility for their transportation.”

Jennifer Dunnam, president of the National Federation of the Blind, said thousands of blind people and others use mainstream public transportation daily to get to and from jobs, to get groceries and do other community activities. “It would endanger our jobs,” she said of service cuts. “We don’t need another barrier added. …This economy needs us to remain tax-paying citizens.”

Jennifer Mundt, board president for Transit for Livable Communities, summed up a recurring theme. “There is no worse time than an economic crisis to cut the bus system,” she said.

Car sales taxes down

The three biggest funding sources for the regional transit system are the motor vehicle sales tax (30 percent); fares (26 percent) and the state general fund (22 percent). With car sales tax dropping, so have transit subsidies.

In fiscal year 2003, motor vehicle sales taxes generated $124 million for regional transit, according to Met Council data. In fiscal year 2009, the sales tax is expected to drop to $113 million. (The tax is projected to rebound in future years, but such projections have been overly optimistic in the past.)

Hennepin County Commissioner Peter McLaughlin, chair of the county’s Transit Improvement Board, also spoke at the March 4 hearing. He opposed fare increases and warned about potential state budget cuts, which would make the deficit even worse. He advocated use of the stimulus money, reserves and other short-term fixes.

“Car sales will come back at some point,” McLaughlin said. “We have to make sure we do not allow the integrity of the transit system to be destroyed because of this short-term crisis.”

Scott Russell is a journalist. He wrote for the Southwest Journal and Skyway News (now the Downtown Journal) in Minneapolis from 1999-2005. He also wrote for The Capital Times, a Madison Wisconsin daily, from 1993-1999.

Scott Russell

Scott Russell (scott@tcdailyplanet.net) wrote for the Southwest Journal and Skyway News (now the Downtown Journal) in Minneapolis from 1999-2005. He also wrote for The Capital Times, a Madison Wisc