For years, Port Authority riders have endured fare increases, service reductions and threats of more to come.
But the transit agency's engine has stopped sputtering, at least for now, and a budget proposal unveiled Wednesday calls for no changes in fares at least through June 2014. It paints the rosiest financial picture in years for an organization that just months ago faced a doomsday scenario.
The current base fare of $2.50, in place since July, is tied for highest in the nation with four other transit systems, said Peter Schenk, director of financial planning and budgets. Saying fares already are "at a critical point," he said he hoped that the authority could hold the line beyond the 2013-14 fiscal year.
The authority has raised fares 11 times since 1975, when 40 cents bought a bus ride. Three of the increases came in the last five years, along with two service reductions of 15 percent each, causing ridership to decline to a projected all-time low of just more than 60 million for the current fiscal year.
Pittsburgh is tied with transit systems in Portland, Ore., Atlanta, Dallas and Sacramento, Calif., for the highest base fare, Mr. Schenk reported. The average for 36 big-city systems surveyed was just under $2.
Had Port Authority fares simply kept pace with inflation since 1975, the current base fare would be $1.75.
Revenue from passenger fares is expected to cover about 29 percent of the agency's 2013-14 operating costs, which is in line with percentages at other major U.S. transit systems, Mr. Schenk said. Federal, state and local funding will cover the rest.
Next year's budget proposal is strengthened by savings from concessions made by union workers and by increases in state and local funding. It calls for spending $366.6 million, a 1.5 percent decrease from the current year.
Last year, the agency was prepared to cut 35 percent of its remaining service, eliminating 46 of 102 bus routes and discontinuing most service after 10 p.m., to cover a projected $64 million budget deficit. That was averted by a rescue plan that included union givebacks and increased funding from Gov. Tom Corbett and Allegheny County.
The authority has made progress against its biggest financial problem, retiree costs, but still expects to spend more than $50 million on pensions and retiree health care in the coming year. Pension costs are down more than $10 million in the budget because of changes agreed to last year by Local 85 of the Amalgamated Transit Union, which represents operators, mechanics and first-level supervisors.
Union workers' pension contributions increased from 5.5 percent of wages to 10.5 percent. Local 85 also agreed to language protecting the agency from sharp spikes in its own mandatory contributions to the pension fund. Contributions by nonunion workers rose from 4.5 percent of salary to 10.5 percent.
Even with the pension savings, the overall cost of salaries, wages and benefits will approach $260 million, consuming more than 70 percent of the budget. That amounts to more than $4 for every ride taken on the transit system.
The authority's financial standing will be further strengthened if the Legislature approves a statewide transportation funding bill now pending in the state Senate.
Interim CEO Ellen McLean said the authority does not yet know the precise impact Senate Bill 1 would have. But she said it is likely to be positive. It would raise an estimated $183 million in new revenue for transit systems statewide in the first year, with that amount growing to $510 million by the fifth year.
Port Authority's share of the first-year revenue would be about $40 million.
Jon Schmitz: email@example.com or 412-263-1868. First Published May 15, 2013 11:45 AM