First Fuel Prices, Now the Economy

Aug 15, 2008 by Elizabeth Ziegler

Declining Sales Tax Revenues Hit UTA Where it Hurts

(KCPW News) The Utah Transit Authority's fuel-induced budget woes are now even worse, since the slowing economy has cut sales tax revenues that subsidize the agency. Even with two fuel surcharges added to ticket prices over the past two months and ridership up 20 percent this summer, UTA spokeswoman Carrie Bohnsack-Ware says the agency still faces budget cuts.

"Well, historically ridership has only covers about 30 percent of our operations and maintenance costs," she says. "And so, it's a really difficult line because you don't want taxpayers to pay too much of the burden, and you don't want riders to pay too much of the burden. And so, it's really a fine line to balance everything out."

If the economy remains sluggish, the UTA will need to trim $5.5 million from next year's anticipated $201 million budget. Bohnsack-Ware says cutting routes is the agency's last resort. But it's already trimmed nearly $3 million in administrative costs, and she says it's unlikely they'll find more fat in the budget.

Does this mean the UTA should increase the fuel surcharge to save bus routes? Bohnsack-Ware says not necessarily.

"If we set it too high," she says, "then what would happen is that people would stop riding and so we would see even less funding."

This difficult situation has prompted some board members to support a proposal for a UTA rainy day fund for lean budget years.

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