The New Jersey Transit Authority yesterday approved two spending measures for fiscal 2010, a $1.39 billion capital plan and a $1.79 billion operating budget as the agency reached its 30th year of providing mass-transit services throughout the Garden State.
The capital budget is about $100 million larger than in fiscal 2009. To help finance infrastructure improvements in fiscal 2010, which began July 1, the New Jersey Transportation Trust Fund Authority will issue $692 million of bonds for NJ Transit capital projects, while federal funds will round out the capital plan.
Larger infrastructure projects include a new $8.7 billion commuter-train tunnel called the Mass Transit Tunnel Project, which will run from Newark to mid-town Manhattan. NJ Transit broke ground on the tunnel project last month and it will receive $193 million from the fiscal 2010 capital plan.
The agency is also working on replacing a 100-year old, two-track railroad bridge, called the Portal Bridge, that spans the Hackensack River and is used by NJ Transit and Amtrak. The nearly $1.8 billion project will create five railroad tracks over two new railroad bridges to replace the existing span.
In addition, the new bridges will be high enough to avoid maritime traffic along the river. The current Portal Bridge must open up to accommodate boats passing through. Officials will spend roughly $15 million on the project this year.
NJ Transit executive director Richard Sarles said the authority is looking to gain federal aid for the $1.8 billion project through the Federal Railroad Administration.
"We've talked about having a cost-sharing arrangement with them," Sarles told reporters after the board meeting. "That's something that has yet to be negotiated, but that's our anticipation."
Officials anticipate completing both the new Hudson mass-transit tunnel and the Portal Bridge project in 2017.
About 60% of the $1.39 billion capital budget is dedicated to fixed expenses, such as $281 million for debt service costs, $121 million for federally mandated rural transit programs, and other federal incentives. The remaining 40% of the capital budget will support state-of-good-repair projects and address capacity needs.
In looking at the $1.79 billion operating budget, which does not include fare increases or major service reductions, the agency will impose furloughs, wage freezes, and other administrative cuts totaling $22.5 million to help offset a $62 million drop in state aid due to budget cuts at the state level.
Sarles stressed that while the agency anticipates a modest 2% ridership growth in fiscal 2010, his team will monitor passenger use and also fuel prices in the event that officials need to alter the spending plan.
"Given the volatility of the economy, we'll watch the ridership trends closely as well as fuel and other commodity costs in the coming fiscal year," Sarles told the board during the meeting.
In prior years, NJ Transit's ridership has increased by 3% to 5%, he said.
During the past few years, management has been working to reduce expenditures. The authority now spends eight cents per dollar to cover administrative costs, down from 12 cents two or three years ago.
"This is a historic low for this agency in that only eight cents of every operating dollar is spent on corporate administration," Sarles said.
Officials anticipate collecting $872.3 million of passenger and other system-generated revenue in fiscal 2010. Passenger revenue is projected to total $780 million, a 2.2% increase over last year. In addition, NJ Transit will receive $296.2 million in state aid and $621.4 million of state and federal reimbursements, which is $102.7 million more than it received in fiscal 2009.
The fiscal 2010 operating budget includes two new services. Beginning July 26, NJ Transit will offer light-rail service from Hoboken to the Meadowlands Sports Complex for major events at Giants Stadium. Newark will also see additional express bus service in the city.