Jeff, secretary of the Office of Policy and Management, told lawmakers the administration recommends moving Town Aid Road back into the capital budget after it had been placed in the Special Transportation Fund two years earlier. "We do recommend moving Town Aid Road back out to the capital budget," he said, adding the change will help the Special Transportation Fund maintain a healthy cumulative balance.

On transit, the presentation proposed additional state operating appropriations and fare changes. Officials proposed roughly $96 million in additional state funding for rail and about $67.4 million for bus service over the biennium. To help defray part of those costs, the administration proposed a 5% rail fare increase in each year of the biennium and a bus-fare increase that the presentation indicated would yield roughly $31 million in the first stage; in the second year the administration also proposed a further fare adjustment. The U-Pass program for college riders would see a second-year increase, the slides said.

Why it matters: Committee members raised equity concerns about fare increases and asked whether the hikes would disproportionately affect low-income riders and students. The secretary responded that bus and rail remain heavily subsidized and the proposed fare increases account for only a portion of rising operating costs.

Additional context: OPM said recent fare increases had not kept pace with inflation and that the rail and bus proposals were intended to share some of the cost increases with fare-paying riders while preserving subsidy for the service. The administration will provide more detail on exact fare levels and the impact on specific rider groups in upcoming hearings.