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St. Louis’ Metro recently approved a fiscal-year 2006 operating budget of $178.5 million — which includes a fare increase — and a three-year capital plan.

The agency’s local revenue has declined or remained flat while diesel and medical costs have increased. Metro officials have tried to cut costs by reducing workers’ compensation claims, and improving vehicle maintenance, and financial, purchasing and inventory systems. They’ve also frozen management salaries and increased the retirement age for non-union employees from 60 to 65.

However, the agency will need to raise fares to help offset cost increases, officials said in a prepared statement.

Metro also approved a $752.4 million three-year capital program, which includes funds to purchase vehicles, complete rail projects, conduct health and safety programs, improve infrastructure and upgrade technology.