New Jersey Transit

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Q: Why does NJ TRANSIT need a subsidy from the state?
It keeps fares affordable while reducing roadway congestion. There is no mass transit system in North America that operates without public support (i.e. subsidy). The Northeast Corridor is the only NJ TRANSIT rail service that breaks even on the system - meaning the passenger fares pay for the operating cost of the service.
Q: Why don't passenger fares cover the cost of service?
NJ TRANSIT's current farebox recovery is approximately 43 percent, down from a high of 50 percent. This means that average fares cover only 43 cents of every dollar of cost for operating transit service.
Q: If the state subsidy cut this year is only a small portion of your total budget, why is your projected deficit for next fiscal year approaching $300 million?
The state faces an $11 billion deficit next year and will not be in a position to provide its historic level of NJ TRANSIT operating assistance, and NJ TRANSIT is unable to depend on another round of federal stimulus and other one-time federal transportation funding, which was utilized to help bolster the operating budget by $150 million. In addition, NJ TRANSIT is facing inflationary cost increases for things such as fuel and equipment parts, even as ridership has declined systemwide by about four percent year to date, reducing fare revenue.
Q: How much of the operating budget actually goes to service delivery?
In Fiscal Year 2010, 92 cents of every operating dollar goes directly to service delivery, with less than eight cents used for administrative expense. This high level of efficiency was achieved through $22.5 million in savings through furloughs, wage freezes, and reductions in certain contracts, printing and other administrative programs. Also, 240 back office positions have been eliminated through early retirement and attrition since 2007.
Q: What have you done to cut the budget before deciding fares must increase?
NJ TRANSIT has identified a total of more than $30 million in reductions to help solve a combined $300 million budget gap projected for FY 2010 and 2011. In addition to implementing an emergency spending freeze, which halts spending that is not directly tied to operations or that is not critical for safety, NJ TRANSIT will reduce its workforce by more than 200, cut executive salaries by five percent, and reduce the corporation's contributions to employee 401k accounts by one-third. These reductions follow in the wake of hiring and salary freezes that began last year, as well as unpaid furloughs for administrative (non-agreement) employees. NJ TRANSIT has also identified cost reductions in parts, fuel, utilities, and contracts that will be renegotiated to avoid escalations.
Q: Can't you balance the budget without raising fares?
We are reviewing every option, including reducing payroll and fringe expenses, hedging fuel costs, reducing parts inventories, and taking other actions to reduce costs. While we are still developing our budget plans based on public feedback, a fare increase will be necessary, together with service reductions and operating efficiencies. However, every possible internal efficiency will be identified.
Q: NJ TRANSIT had more than five years of record-setting ridership-what happened to the passengers?
The recession has wiped out more than two year's worth of ridership gains, as regional unemployment has grown and fuel prices declined.
Q: Are you looking at other revenue sources?
Yes. We are looking at ways to maximize our non-farebox revenue, including advertising, real estate, and other commercial revenue opportunities.
Q: Have you looked at leasing retail/vendor space at all of your stations?
Yes. In fact, nearly five percent of our operating budget is the result of non-farebox revenue sources. We continue to pursue new and creative ways to generate even more revenue from our assets.
Q: Why are you building a new Hudson River tunnel in the middle of a budget crisis? Can't you use some of that money?
Funding for the tunnel comes from the federal government, the Port Authority and other capital funds that have been dedicated for this project and cannot be used for anything else. Capital money, or construction money, can't be used to offset daily operating costs of buses and trains. Without the project, the funds would go to other projects in other states.
Q: How are you still able to afford projects like Pennsauken Transit Center?
The Pennsauken Transit Center, which will directly link the River Line with the Atlantic City Rail Line, is being funded through the federal American Recovery and Reinvestment Act of 2009.
Q: When was the last NJ TRANSIT fare increase?
NJ TRANSIT's fare increase history is as follows:
  • June 2007 - 9.6 percent
  • July 2005 - 11.5 percent
  • April 2002 - 10 percent
  • July 1990 - 9 percent
  • May 1989 - 12.5 percent
  • May 1988 - 9 percent
  • July 1986 - 10.6 percent
  • Sept. 1983 - 9 percent
  • July 1982 - 17.5 percent
  • July 1981 - 22 percent
  • July 1980 - 11 percent
Q: When my train is really crowded, the conductor doesn't collect tickets. How can you raise fares when you currently don't even collect all of the fares?
We are focused on ensuring that all fares are collected, and management is taking steps to reinforce this focus. On our light rail lines, the monthly average rate of fare violations last year was only 1.4 percent for the system. We encourage you to let us know if tickets go uncollected by using the "Contact Us" form online.