CA: Caltrain Adopts Balanced Operating Budget

Caltrain’s Board of Directors June 5 adopted a Fiscal Year 2015 operating budget that is fully balanced and requires no cuts in service and no fare increases.

The FY2015 budget depends on one-time-only funds to achieve balance, as has been the case for Caltrain budgets the last several years.

Caltrain still must address a structural deficit that leaves the agency vulnerable in years of ridership decline or economic downturn. Efforts continue to identify and put in place a dedicated and sustainable source of funding for Caltrain operations.

The most significant source of one-time-only funds for FY2015 is a result of the historic growth in ridership, which has led to record-setting farebox revenues. Such growth cannot be relied, upon, however, as a sustainable, dependable source of revenue year after year. Should Caltrain’s ridership growth slow, farebox returns would begin to normalize.

The $125.7 million operating budget allows Caltrain to retain current service levels.  Fares cover $75 million of the projected operating revenue; income from shuttles, parking, grants and other sources make up $18.1million; member agency contributions cover another $19.8 million; the remaining $12.8 million is covered by using surplus farebox revenue from Fiscal Years 2013 and 2014.  Caltrain’s unprecedented ridership growth led to higher than expected fare collection for those prior fiscal years.  That money was set aside to help cover the cost of operating the railroad’s service, but it is not a long-term solution.  Contributions from the three agencies that partner in the ownership and operation of Caltrain are up slightly over the previous fiscal year. 

According to the budget, the City and County of San Francisco will contribute $5.2 million, The Santa Clara Valley Transportation Authority (VTA) will contribute $8.4 million and the San Mateo County Transit District (SamTrans) will contribute $6.3 million.  Each agency’s contribution is based on a formula derived from the average weekday number of boardings that take place in each county.

The operating budget contains an increase of roughly $5 million over the previous year’s budget.  The increases are largely due to higher operating costs resulting from the increased ridership demands on the railroad. 

As a way to confront significant capacity issues brought on by record ridership growth, Caltrain is negotiating the purchase of additional rail cars to help enlarge the rail agency’s fleet. If the negotiations are successful, the new cars will be added to existing trains and would enable Caltrain to carry more passengers.

Caltrain has not adopted its proposed $109.1 million capital budget.  The capital budget covers the costs of improvements driven by federal and legal mandates, Caltrain Modernization and keeping the railroad in a state of good repair. 

The preliminary capital budget is not yet balanced.  Caltrain is continuing to work with the Metropolitan Transit Commission to release Federal Transit Administration funding for State of Good Repair projects and is reviewing the list of project priorities.

The capital budget proposal includes funding from a variety of grant programs, including federal and state sources.  The partner agencies combined have committed $10.5 million toward the capital budget.