- Associated Press - Friday, June 10, 2016

NEWARK, N.J. (AP) - New Jersey Transit on Friday released details of a proposed $2.1 billion operating budget for the coming fiscal year that included no fare increases and a projected ridership revenue increase of nearly 2 percent, despite recent figures showing that number falling.

The agency also released a proposed $1.7 billion capital plan that assumes more than $500 million from the beleaguered Transportation Trust Fund. The proposals were contained in an agenda for next Wednesday’s NJ Transit board administration committee meeting.

The operating budget includes a proposed state subsidy of $140 million, a hefty increase over the $33 million subsidy in the current fiscal year. The direct state operating subsidy had plummeted in recent years but has been made up by contributions from the New Jersey Turnpike Authority and state Clean Energy fund, maintaining the overall level of state support over the last several years.

In announcing a tentative agreement with rail unions in March less than two days before a strike deadline, Republican Gov. Chris Christie promised there would be no fare increases at least until the end of the fiscal year on June 30, 2017. Last year NJ Transit increased bus and rail fares an average of 9 percent, its fifth fare hike since 2002.

The proposed budget also projects growth of 1.8 percent in revenue from passenger fares. According to figures contained in Friday’s document, revenue from passenger fares has dropped more than $10 million, or 1.2 percent, below projections for the current fiscal year.

Low gas prices, which prompt people to drive instead of take mass transit, are considered a key factor in the revenue drop.

NJ Transit officials believe that despite the lower ridership levels recorded earlier this year, the fare increases implemented last October multiplied out over a full year should produce a passenger revenue increase.

The proposed capital plan envisions $554 million from the Transportation Trust Fund. Department of Transportation Commissioner Richard Hammer said in April the fund had about $83 million in cash, enough to carry it into early August.

Lawmakers are grappling with a solution, and on Friday they produced competing plans that envision a fuel tax increase coupled with other tax cuts.

Christie has said any hike in the gas tax would have to be accompanied by tax cuts in other areas.

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