RTD Dips Into Special Fund to Avoid Fare Hike

The RTD board Thursday spared its 1.5 million daily riders a fare hike with a package of last-minute, belt-tightening measures--most of them not related directly to bus service--that provided an anticlimatic close to a months-long debate over the transit district’s budget troubles.

The basic 85-cent fare, as well as other fees for monthly discount passes, will remain the same for at least a year.

The sudden reversal in the transit district’s deficit predicament came when RTD General Manager John Dyer late Wednesday issued a report disclosing that about $4 million in previously unbudgeted funds were available in a special reserve account.

That report was released after the Los Angeles Angeles County Transportation Commission, which controls most of the transit funding in the county, rejected the RTD’s plea for extra money to erase its deficit. Commission analysts, among other things, questioned why the RTD did not use its special reserve account and why it has spent millions on consultants for studies done by other agencies.

Recommendation Made

Instead, Dyer had repeatedly recommended fare increases to 90 cents or $1 to balance the $513-million operating budget for 1987-88, which remained $9.5 million in the red before the board’s vote Thursday. Dyer, whose staff initially forecast the deficit at about $40 million several months ago and whittled the figure down through cost-cutting measures, had argued that the last several million should come from higher fares.

With the commission turning down their request for funds, some board members unsuccessfully attempted to go along with Dyer Thursday.

“To expect us to keep transportation as the only commodity that doesn’t increase in cost is ridiculous,” board member Erwin Jones said.

Board member Marv Holen said that a fare increase was “tragic” but necessary and using the special reserve fund was a dangerous move. He said the RTD would be spending more than it takes in next year.

“This is a budget without integrity; a New York City-type budget . . . . We are engaged in a camouflage,” he said.

Earl Clark, general chairman of the RTD bus drivers union, said a fare hike was needed to maintain and expand service. Claiming that many rush-hour buses are packed to the point of violating state law, Clark said, “Ask the passengers; they’d gladly give another dime if they could get a bus.”

Board member Nikolas Patsaouras said raising fares would hurt the poor the most. He said the public is already paying increased taxes to keep fares low through Los Angeles County’s special half-cent sales tax for transit, a large share of which goes to the RTD’s operating budget.

Other board members, irked at their rivals at the commission, suggested that holding the line on fares would only postpone the inevitable. But by next year the decision on fares would, in the words of board member Jay Price, “put the monkey back where it belongs”--on the commission’s back.

The Legislature is moving to abolish the RTD by having it absorbed by the commission.

But one RTD board member, sensitive to a litany of reports of district mismanagement and loose controls on spending, said it was the wrong time to ask the public for more.

“I don’t think we’ve earned that nickel in the last year,” board member Carmen Estrada said, referring to Dyer’s 90-cent fare proposal.

In addition to dipping into its reserve account, which Dyer warned could reduce the RTD’s high bond rating, the board voted for a partial freeze on hiring, deferral of a rebuilding program for older buses and a shift in some funds from construction to operating accounts.