OCTA Budget Outlook: Balanced, But Problems Loom

The first Orange County Transportation Authority budget presentation for 2017-2018 to its board of directors Monday show a stable short-term future, but with looming problems on the horizon.

Next year's budget is projected to be $1.28 billion, with 84 percent designated for transportation projects, operations, and maintenance. Funding for buses make up the largest slice of the budget at $349.4 million, followed by the OC Streetcar at $239.9 million and freeways at $170.4 million

OCTA staff expect a balanced budget next year, with new funding from the recently approved CA Senate Bill 1 filling an expected $20 million gap for its bus program, and centerpiece projects like the OC Streetcar and the 405 widening project being well funded with a mix of federal, state, and local funding.

“The issues that are facing OCTA from a financial perspective--I believe we’re in a very solid financial position,” said Andrew Oftelie, OCTA executive director of finance and administration.

Though bus ridership is expected to decrease by six percent next year to a little under 39 million boardings, the new funding from S.B. 1 stopped any potential cuts in service or fare changes. "S.B. 1 came and kind of saved the day on us,” said Oftelie. “When we presented the draft of this to the (Finance and Administration) committee, we had assumed a service cut.”

S.B. 1 will net $13 million this year for the authority and roughly $19 million in the following years.

The state funding will also give more time for OCTA to work on strategies to turn ridership decline around. As part of the OC Bus 360 plan, last year the authority cut service in low performing areas and added additional service to higher use areas. OCTA had also decreased day pass fares from $5 to $4 for a six-month period, but authority staff ended the pass when they learned it didn't draw new riders.

Yet, if ridership doesn't turn around? “That will create more financial pressure and we may have to make some difficult decisions one year from now,” said Oftelie.

The continued demand for paratransit service--transportation for persons with disabilities--led to it getting a bump in funds in this budget, said Joel Zlotnik, OCTA spokesperson. “We continue to see increased demand for paratransit services, which  has risen from 1.42 million boardings to almost 1.8 million in just eight years, an increase of 26 percent,” Zlotnik said. The $44 million budget will allow an increase of 24,035 revenue hours for primary service, 62,097 supplemental service trips, 10,204 same-day taxi trips, and 45,800 special agency trips.

The current schedule for budget approval is as follows:

• Public Hearing Preview – Finance and Administration Committee, May 24
• Public Hearing – Board (Public Hearing and approval), June 12
• Back-up Public Hearing – Board (Public Hearing and approval), June 26

If you're daring enough to take a look at the entire proposed budget, click here.