Transit Agency Faces Shortfall of $73 Million

County mass transit officials, facing an unexpected $73-million shortfall in operating subsidies, pledged Wednesday to seek some way to avoid bus fare hikes or service cuts, but offered only vague ideas on how.

“I don’t have a specific plan in front of me today that shows how to do it,” said Neil Peterson, executive director of the Los Angeles County Transportation Commission, which doles out construction and operating funds to local bus and train operators. “We’re working on it, and I think we can do something (to balance budgets) that will have minimal impact.”

Marvin Holen, president of the Southern California Rapid Transit District board of directors, was less optimistic. “Nobody has whispered a secret plan in my ear. Nobody,” he said.

The operating shortfall is the major share of a $133-million drop this year in overall mass transit funding precipitated by a recession-fueled 7.3% decrease in sales tax revenues. Much of the county’s ambitious transit program is funded by a half-cent sales tax surcharge.

Lower sales caused by the recession also have made less money available for such programs as Metro Rail construction and some local transportation projects, which also receive sales tax money. But the biggest cuts are being imposed on bus operating subsidies--more than 80% of which go to the huge Southern California Rapid Transit District.

The county commission offered Wednesday to ease the $73-million shortfall in operating subsidies this year by parceling out $38 million from its reserves. The remaining uncovered shortfall of $35 million will have to be made up by the bus operators, including municipal bus lines run by such cities as Santa Monica and Montebello.

RTD, the largest operator, will have to absorb $29.2 million of the uncovered shortfall, which comes on top of a previously projected $12.8-million deficit caused largely by declining ridership and an increased use of discount senior citizen and student fares.

Holen said the district has no way to cover the combined deficit of $42 million and said he will ask the county commission to dip into its Metro Rail construction funds for emergency aid.

“Ridership may be down, but we’re (still) so overloaded out there that we need more buses out there, not less,” he said. “The first priority has to be the people who use the public transit system.”

Peterson said construction projects should not be delayed because delays would add greatly to their costs and would cost construction workers their jobs--adding to the recession and further reducing income from sales taxes.