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The layoffs, fare increases and service cuts the Chicago Transit Authority (CTA) had planned to implement yesterday were postponed, thanks to a $21 million grant Illinois Gov. Rod Blagojevich approved for the agency late last week. CTA will use the proceeds to balance its 2007 budget.

The authority had planned to hike rail fares from $1.75 to $2 for riders that use the Chicago Card and Chicago Card Plus; from $2 to $2.50 during off-peak hours for passengers paying with cash; and from $2 to $3 for cash-paying riders during peak periods. In addition, CTA would have laid off 600 employees and eliminated 39 bus routes.

However, the agency still needs a long-term state funding source; without one, it will face a “significant budget shortfall” in 2008 and be forced to implement service cuts, fare increases and layoffs, CTA said.