The board of New Jersey Transit on Wednesday approved a new $2.86 billion operating budget that does not raise fares. But it also does not offer a way to keep the agency from falling off a looming billion-dollar fiscal cliff in a couple years.
“If this budget crisis continues to be ignored, riders will inevitably be faced with fare hikes and service cuts,” said Corey Hannigan of Tri-State Transportation. “We desperately need stable funding for public transit service if we hope to provide workers and families with a reliable way to move about the region.”
Advocates question the agency’s funding strategies. This spending plan burns through NJ Transit’s remaining $800 million in federal pandemic aid, creating an automatic shortfall next year. The budget relies on ridership increasing to 76% of pre-pandemic levels, yielding $776 million in farebox revenues but estimates have been over-optimistic in the past. NJ Transit CEO Kevin Corbett said weekday ridership remains at approximately 65% of pre-COVID levels. “We’re fluctuating between 65-75 percent depending on the day of the week,” Corbett said.
To help make ends meet, NJ Transit again transferred funds from the Clean Energy Fund, this time to the tune of $70 million. It will also take $362 million from its capital budget to keep the wheels turning. Finally, it relies on $440 million in New Jersey Turnpike funds and $142 million in state aid.
Critics deplore the lack of stable state support for the transit agency. “The issue is, NJ Transit does not get enough state funding. And it’s the only agency of its size in the country without a stable and dedicated revenue source,” said Alex Ambrose of New Jersey Policy Perspective.
Others who commented at Wednesday night’s meeting questioned the agency’s decision to move its headquarters from its current location — which needs about $120 million in renovations — to offices at Two Gateway in Newark, owned by Onyx, which has political connections to Gov. Phil Murphy. The new 25-year lease costs $440 million.
Senate Minority Leader Anthony Bucco (R-Morris) has sent NJ Transit a letter requesting information about bids, negotiations and financial details of the deal and wants legislative hearings to determine if it’s the best choice.
