The Chattanooga Area Regional Transportation Authority’s budget for fiscal year 2026 will continue the work of fixing a “chronically underfunded” foundation while formally exploring ways to increase revenue. The goal is to protect fixed route fares even as the organization grows in demand and ridership.
“We did not get all the funding we needed last year to do that work,” said President and CEO Charles Frazier at the board meeting on Thursday.
Mr. Frazier and board Chair Johan de Nysschen thanked the cities of Chattanooga, Red Bank and East Ridge for their advocacy, which has borne great progress in the right direction this year, they said.
“I almost feel like celebrating,” Chair de Nysschen said.
Mr. Frazier outlined new positions that he said are the final building blocks of that foundation: fixed route dispatcher, road supervisors, CARTA Go operators, shuttle operator, maintenance technician, customer service, IT, and bilingual community outreach.
Budget:
CARTA’s budget for fiscal year 2026 has jumped by almost $5 million to $34.8 million.
While fixed-route fares remain untouched, CARTA Go and the Incline will see fare increases, and some parking zones will see increases as well, though parking fees in some zones will decrease and some fixed routes will be free.
CARTA is predicting increases in ridership and parking volume to raise revenues.
While CARTA loses $1.5 million in federal and state funding, the ity of Chattanooga has pledged $1.3 million more than last year to CARTA. Pay and benefits increases total $2 million.
As Red Bank pledges to fully fund Care-A-Van, “struggling” East Ridge found subsidies to continue the service this year, giving that city time to plan for next year, Mr. Frazier said.
“That’s very encouraging,” Mr. Frazier said.
CARTA will work to cultivate relationships with smaller municipalities including Lookout Mountain, Tn., Chair Johan de Nysschen said in his closing statement.
Lookout Mountain has told CARTA it cannot afford to provide police, fire and other infrastructure services to the 250,000 people who ride the Incline to the top every year, a problem tested with the December wildfire that involved personnel from Lookout, the National Park Service, Chattanooga and CARTA.
“They are looking to us to find a way to offset those costs,” Chair de Nysschen said.
In other improvements, CARTA plans to install raised, covered platforms similar to a train’s along its most popular fixed Route 4 in Brainerd and later along downtown Broad Street’s north-south route.
It will commit to 15-minute frequency along six routes and add service elsewhere. CARTA plans to build 33 multi-use hubs which bring together transit, bike rentals, storage and travel information, placed at or near libraries or community centers such as Eastgate Library.
“These are the types of resources that we want to put out in the community,” Mr. Frazier said.
Incline Reopening:
The Incline Railway is set to open on schedule Monday, July 14. Tickets are now on sale for that date and beyond.
Mr. Frazier reported that CARTA has obtained a yearlong easement from the NPS to clear brush away from the track – a five-year agreement in the future. CARTA will also install new foam fire sprinklers along the track. A December 2024 brush fire closed the Incline for what will total more than seven months.
Community Outreach:
A first-hour-free pilot program at CARTA parking garages has led to a 37-percent increase in revenue at the Shuttle Park North and South garages with second-hour stays up 762 percent at the north location and 295 percent at the south location, Mr. Frazier said.
The free North Shore Express Shuttle, opened in March as the Walnut Street Bridge closed for repairs, has had 3,163 riders since its launch, or 66 daily riders, he said.
The freebies are part of a joint effort with Chattanooga Mayor Tim Kelly, River City Company, tourism groups and more downtown to drive economic impact there, he said.