NEW YORK (CBSNewYork) — Declining subway and bus ridership and loss of revenues due to a decrease in real estate transactions could blow a huge hole in the Metropolitan Transportation Authority’s budget.

Robert Foran, the agency’s chief financial officer, is urging the board to approve biannual 4 percent fare increases and meet ambitious cost savings targets in order to avoid a serious deficit in a few years.

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“If we don’t hit our savings targets and we don’t have additional revenues coming in as projected with the proposed fare and toll increases in 2019 and 2020 you can see it only gets worse with projected outyear deficits that could be as large as $1.6 – $1.7 billion,” Foran warned. “Without hitting the savings targets we are going to have a gap that comes in 2018 and it grows to over $1 billion in 2021.”

Chairman Joe Lhota said declining ridership has nothing to do with a decline in service.

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“I think this is more economically-driven than it is have anything to do with service delivery,” Lhota said. “We are not seeing a decline in rush hour, we’re seeing a decline in between, we are seeing a decline on the weekends.”

There is still no long-term funding source for the so-called subway action plan, which is expected to add $1.5 billion to the agency’s operating budget.

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Lhota said the plan has decreased delays on the subways by 20 percent since the so-called “summer of hell.”