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The Utah Transit Authority board on Wednesday approved a 2015 budget that increases service hours by 2 percent — but takes nearly $10 million from reserves to make operations ends meet.

It includes restoring service on the Memorial, Independence and Labor Day holidays, which was cut during the recession.

"We are making headway in providing additional services," said board member Charles Henderson.

But a rider's group, the Utah Transit Riders Union, had called for more late-night and weekend service by spending an additional $2 million from reserves — beyond the $9.86 million that the budget already is using.

Henderson said UTA looked closely at that, but $2 million extra would not fund much that is meaningful.

But board member Keith Bartholomew said UTA wants to move toward offering at least some skeletal service 24 hours a day, which most big-city systems do. "We are very serious at looking at late-night service and weekend service and holiday service. We want to look at it from a systematic approach" to ensure meaningful connections.

For example, he noted UTA has been asked to expand hours on its green line TRAX to the airport to serve early and late airline flights. But, "We are also concerned about running a single train line that doesn't connect to the rest of the system."

The new budget avoids any fare increases in 2015.

But the board is aiming to convert in early 2016 to a distance-based fare system, and cease to charge the same fare for trips of any length. That eventually may lower fares for short trips, but raise them for long ones.

Some other gifts for patrons in the budget include $1 million to replace the balky Wi-Fi Internet system on FrontRunner trains. Other technology initiatives include improving the UTA website, developing a mobile version of that website, and studying ways to implement a mobile-ticketing system.

The budget also includes funding for a planned 2 percent pay hike for administrative workers in April, and a 1 percent increase for other workers in July followed by a 2 percent raise for them next December.

That comes after a recent legislative audit questioned high pay for top officials at the agency, and criticized comparisons it has used to justify them. UTA President and CEO Michael Allegra's compensation last year was $402,187, for example.

The legislative audit also had criticized UTA for spending more than revenues generate, which the new budget does again by dipping into reserves. The audit said that has contributed to shaky UTA finances after the agency borrowed heavily to build new TRAX, Frontrunner and streetcar lines.

The debt service on bonds for rail projects is protected to cost UTA $100.5 million next year, or 29 percent of its total $346.9 million operations budget.

Given such obligations, the legislative audit warned, "UTA has little margin for error if sales-tax revenues do not meet expectations in coming years."

UTA projects that after dipping into reserves next year, those savings would still total about $160.9 million at the end of 2015. It is said it plans to dip into them more in coming years, and would leave reserves at a low point of $101 million in 2019 before rising again.

UTA spokesman Remi Barron said the agency does not see using reserves as a problem.

"UTA's financial situation is sound in the long-term and has even improved since the audit was conducted. Rather than take a year-by-year approach to budgeting, UTA uses a 30-year financial forecasting model to enforce long-term financial discipline," he said, adding that projected ending reserves are higher than the audit anticipated.

The board also approved a $133.8 million capital budget for projects. Nearly half of that — $68 million — is for construction of a "bus rapid transit" line between Orem and Provo. Such lines include some bus-only lanes on streets, have riders buy tickets from machines before entering and allow bus drivers to change traffic signals in their favor.

The budget also includes $670,000 for design to relocate the airport TRAX station as part of the expansion of Salt Lake City International Airport. It also includes $1 million for pedestrian crossing upgrades throughout its system.

Also included is buying 11 replacement buses, 61 paratransit vans, and 103 Rideshare vans.