A combination of reserves and federal bailout money will help the Orange County Transportation Authority weather the coronavirus-induced economic storm in the short term, but budget officials said Monday the long-term prognosis is unclear.
Since stay-at-home orders were issued in mid-March to stem the spread of COVID-19, budget officials expect sales tax revenues to drop by 4.3% over last fiscal year. By the last quarter of fiscal year 2019-20, sales tax revenue will plummet about 33%, OCTA officials say.
OCTA board members are expected to vote on the budget June 8.
“No one could anticipate the situation we’re in today,” Andrew Oftelie, the OCTA’s chief financial officer, said as he briefed board members on the annual budget. “The long-term future has never been more unclear.”
But “strong reserves” and money from the CARES Act “has positioned us very well,” Oftelie said.
With the CARES Act funding, OCTA hopes to have bus service continue at pre-COVID-19 levels, which have been reduced to a Sunday schedule during the pandemic. Ridership is down 90% currently versus last year at this time, officials said.
“There is no parallel to today’s situation,” Oftelie said. “We cannot say with any certainty what effect the pandemic will have on sales taxes.”
Revenue from tolls has also declined steeply.
The toll lanes on the Riverside (91) are seeing about 70% less traffic.
Since officials are unclear whether the economy can bounce back when stay-at-home directions are relaxed, they will likely need to make more adjustments than usual throughout the fiscal year.
“Amendments throughout the year are likely,” Oftelie said. “We are keeping our infrastructure projects on schedule because we have that money in hand.”