Claypool on CTA budget: Springfield mandates and health obligations led to ‘fiscal abyss’

June 23, 2011

Produced by Eight Forty-Eight

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(WBEZ/File)
CTA President Forrest Claypool joined us to discuss what we can expect from bus and rail service.

Chicago Mayor Rahm Emanuel didn’t waste any time putting his picks in some of city’s top positions. Forrest Claypool is an old ally of the mayor’s and a longtime political player. Emanuel tapped him to run the Chicago Transit Authority. Previously, Claypool was a Cook County commissioner and ran the Chicago Park District under former Mayor Richard M. Daley. In 2010, Claypool lost a bid for Cook County Assessor.

Claypool has run as and been called a reformer.  He has come up against unions in the past, which could become an issue as the CTA confronts a budget deficit. Eight Forty-Eight was joined by the CTA president to learn more about what Chicago can expect from bus and rail service.

WBEZ: A couple of eyebrows were raised when your appointment was announced. You’re the third head of the CTA that doesn’t come with a background in transportation, with that kind of experience in ground transportation. What do you hope to accomplish on the job? Why did you want to take this?

CLAYPOOL: Public transit is one of the most critical things for a great metropolis. The great thing about the great cities like Chicago and New York is the density that generates wealth and energy and activity of people who want to come together and be creative and create commerce. A strong public transit system is the artery and the links that allow people to move to and from quickly and efficiently, for job purposes, for business purposes and to link communities together seamlessly. I don’t think people really fully realize how wealth producing, job producing mass transit is when it’s done right, and how critical it is to the quality of life in the city. So it’s a critical mission and a huge management challenge, which is why I’m grateful to Mayor Emanuel because my career has been as a public manager and I think I’ve had success in the past in a lot of different roles and I think this is a big challenge that I welcome.

WBEZ:You said [the CTA] can be an economic driver if it’s done right. You have a reputation as a reformer. That was your track record at the Chicago Parks District. What does reform look like at the CTA? How do you do it right?

CLAYPOOL: It’s finally dealing with the economic realities. That’s going to be true at the schools; it’s going to be true at City Hall. The CTA has lived on borrowed time, borrowing hundreds of millions of dollars every year in recent years to balance the budget, borrowing from the future to pay for current expenses. You just can’t continue to do that. We have a big investment challenge in that the infrastructure is in declining health. It is difficult to improve service if you have an infrastructure that needs billions of dollars in repairs. So the first order of business is to right the fiscal ship. The problem has been that the legislature in Springfield has imposed huge new mandates, about $130 million a year in new spending imposed upon us by new legislative fiat for pension and health-care obligations, declining state of federal aid, a whole host of issues that have led us to the fiscal abyss and that’ll be the biggest challenge we have.

On Budget Deficit

WBEZ: You said this is the perfect budget storm. This year, what kind of deficit are you facing?

Claypool:We don’t know exactly yet. All I can say is that at this point it will be severe. It will be unprecedented. And it will be a major challenge. That is where most of our effort and focus is right now. But while we’re dealing with that, we want to make sure we can do everything we can from a management perspective to make the system the best it can be for our customers. That is why this week, we launched a major security initiative with Chicago Police Department to put more police officers on the trains, undercover as well as visible, wolf pack patrols, and saturating the system with cameras. I think our safety is our number one issue but also the safety and cleanliness of the system for our customers.

 

On CTA Security

WBEZ: You got money from Homeland Security to put some 3,000 new cameras -- double what was already there. We did a lot of those kind of security upgrades in the way after September 11th. Is safety still an issue on the CTA? Is terrorism a concern?

Claypool: We live in a unique age and I think we have to be very vigilant. Our security and safety people work closely with the all agencies to try to make the system as secure as possible. Safety is the number one priority.

On Service Cuts

WBEZ: In previous years, we’ve seen cuts to service, we’ve seen layoffs. Are those going to happen?

Claypool: Again, it’s too early to tell. We’re digging in deep, the budget will be due in late fall. I don’t think people really fully understand that the CTA has been used as a piggybank by politicians in the past. The average fare is actually 98 cents. We were required by law to provide discounted fares for seniors, veterans, law enforcement, students and for everyone else a higher fare. It gives you a sense that for a system of this magnitude, for all its needs, only getting 98 cents for every rider, that is part the issue of the CTA’s fiscal challenges.

On Fare Hikes

WBEZ: The mayor said he doesn’t want to see a fare hike. Is that feasible? Are you going to have to raise fares?

Claypool: Again, it’s too early. We don’t have enough facts, enough information about what needs to be done. It is clear there is an appetite for transit, there is a demand that is there and growing. They understand that with gas and parking prices.

On Union Labor

WBEZ: What are you going to be asking union labors for?

Claypool: We’re definitely going to be having some very direct conversations. I’ve already had some conversations with our union leader and they know it’s going to be a difficult budget and they should prepare for that.

WBEZ:What should they prepare for?

Claypool:They should be prepared for that it is not going to be business as usual. It’s not a typical year in which they can expect normal activity.

WBEZ: They’ve faced layoffs before. They’re paying more for health care and pension. Is more of that coming?

Claypool: Again, the pension and health-care issue should not be a major issue. What happened was the legislature had the CTA pay upfront for all the benefits, which is an additional $130 million burden. And that will grow more than 10 percent of our operating budget.

WBEZ: What is the solution?

Claypool: Increasing ridership is the solution, but it’s a chicken-and-egg game. The Red Line, our workhorse, is in need of repair. The slow zones are preventing enough trains which do nothing to help increase ridership. If you can improve the system, add more trains, speed the faster trains.

WBEZ: What about privatizing like selling station names?

Claypool: We’re looking to maximize revenue but it’s not a panacea. It’s not going to solve the budget deficit. Privatizing doesn’t really play into the CTA going forward. Our core mission is the delivery of services. Any sort of lease arrangements make sense if all the money all goes back into the city, not the operating expenses. I’m hoping for reform legislation to allow private investment in rail, especially with the government pulling back.

Music Button: Shawn Lee, "Lucy Lucy", from the CD Sing A Song, (Ubiquity)