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Two days after Illinois Gov. Rod Blagojevich approved a $21 million grant for the Chicago Transit Authority (CTA) to balance its 2007 budget, the authority has approved a 2008 spending plan that calls for significant service reductions, fare increases and layoffs. The $1 billion budget is $45 million lower than 2007’s, and includes a projected $158 million shortfall.

The reasons for the shortfall? CTA funding agency the Regional Transportation Authority reduced CTA’s funding level by $14 million in 2008 compared with 2007’s total. In addition, the authority’s public funding levels have increased only 4 percent during the past five years while inflation has grown 11.3 percent during the same time period. And, the pension and health care reforms CTA has proposed — which would save the authority about $11 million a month — have not yet been approved by the Illinois General Assembly.

If the general assembly does not approve a long-term transit funding package for the Chicago region, CTA will have to lay off more than 2,400 employees, eliminate 81 of its 154 bus routes and hike fares on Jan. 20, 2008.

The authority would charge higher rail fares during peak periods and to those passengers who pay cash, with the highest base fare being $3.25. Passengers who use CTA’s Chicago Card and Chicago Card Plus still would be offered discounted rates. The authority also would raise one-day passes from $5 to $7; seven-day passes, from $20 to $25; and 30-day passes, from $75 to $94.