O.C. Transit Budget Has Tough Year Ahead

Orange County transportation officials predicted Monday that they will face serious budget challenges in the year ahead with shortages of government funding, looming labor issues and soaring demands by the disabled for transit service.

“We have a tough budget year in front of us,” Arthur T. Leahy, the Orange County Transportation Authority’s chief executive officer, warned board members at their regular meeting. “There are a number of very large financial issues.”

If funds are not found to provide more legally mandated service for the disabled in fiscal year 2004-05, OCTA officials say, they might have to scale back conventional bus service around the county to free up funds.

Also, officials anticipate that the agency’s 1,140 bus drivers will ask for more pay, medical coverage and retirement benefits when contract talks begin in late March. Coach operators now make up to $20 an hour.

Adding to the agency’s difficulties, OCTA disclosed Monday that it has failed to obtain $200 million in competitive federal funding for the $238-million Bristol Street widening in Santa Ana, a cornerstone of the authority’s CenterLine light-rail project.

The setback will force OCTA to compete for limited state funds at a time that the Schwarzenegger administration is cutting transportation money. Leahy said the failure to land federal funds for CenterLine will not affect the agency’s 2004-05 budget, but could affect later ones.

Leahy expressed concerns about the 2004-05 budget just before the board of directors unanimously approved a comprehensive business plan for it. The document is a set of guidelines to help the agency’s staff implement OCTA’s 10 strategic goals for the decade.

Among the priorities are widening the Garden Grove and Riverside freeways, improving local streets and expanding transit services: Those include buses, the Metrolink commuter rail system and CenterLine, the proposed trolley line from John Wayne Airport to the Santa Ana train station.

Monday’s vote included approvals of the funding plan for the $1-billion CenterLine project and the related Bristol Street widening. County supervisors and OCTA board members Bill Campbell and Chris Norby, both CenterLine opponents, voted against the light-rail funding plan.

The board also recommended that $170 million from Measure M supplemental sales tax revenue be transferred to the Garden Grove Freeway project to make up for the loss of state funds previously earmarked for it.

Measure M is the county’s 0.5% sales tax to pay for transportation projects. Both a citizens advisory panel set up by the initiative and the OCTA board must approve adding the Garden Grove Freeway to the list of projects eligible for Measure M funding.

Leahy said the agency will continue to seek state funding for the project.

He emphasized that the long-neglected freeway is one of the most important transportation projects in California.

OCTA will need to increase its $800-million annual budget by at least $11 million for 2004-05 to pay for more transit services for the disabled and more health care and retirement benefits for bus drivers, Leahy said. The figure does not include amounts to compensate for inflation on any expenditures or any increase in driver pay.

Leahy cautioned that the numbers are very preliminary. The process of drafting the 2004-05 budget begins in April.

“Next year is going to be a tight one,” said OCTA board Chairman Greg Winterbottom, who proposed a retreat for directors to discuss the budget situation. “There is a dearth of money and a surfeit of need.”

The authority predicts that the demand for transit services for the disabled will rise from about 1.1 million boardings a year in 2004-05 to 1.33 million by 2007-08, about 23%.

OCTA provides special vans and buses for the disabled through bus companies.

The demand is expected to jump 16% in the next fiscal year, the largest one-year increase in demand for bus service from the disabled during that four-year period. The annual costs are expected to escalate rapidly, from $21 million today to $24 million in 2004-05 and $30 million in 2005-06.

“It is becoming increasingly difficult to provide additional resources for handicapped services without potential impacts to fixed route service,” the comprehensive business plan states.

The authority wants to increase services for the disabled about 8% every year for the next four years to meet demand. At the same time, officials will explore ways to provide that service without compromising routes serving the non-disabled.

Among other things, Leahy said, the agency will seek cheaper contracts with bus companies that serve the disabled with small vehicles.

“I would not anticipate any cuts in bus routes in the coming year,” Leahy said. “We are trying to get ahead of the problem.”

The chief executive said he was disappointed that OCTA did not obtain the $200 million in federal funds for Bristol Street. He said the agency will keep seeking the funds.

OCTA officials said the agency has a chance to get $140 million in state funds at best, about $60 million less than the federal request.

“Whether the money is going to be there is just speculation at this point,” Norby said. “When funded, there might only be $140 million. It could be less.”

Despite the financial challenges ahead, Leahy said, OCTA plans to expand conventional bus service 1% to 2% next year. Measure M funds will be used to widen Orange County’s northernmost three miles of the Santa Ana Freeway, he said, and improvements will continue on the Garden Grove and Riverside freeways.

“Granted, we are in a tough economy,” Leahy said. “But because of the wisdom of the voters on Measure M and the strong Orange County economy, we will probably have the strongest transportation program next year of any county in the state.”