The Regional Transportation Authority Board said the budget gap they're facing in 2026 is now significantly lower at $200 million instead of nearly $800 million as projected earlier this year.

The RTA said this was achieved by "stretching every dollar, managing costs, applying a reasonable 10% increase to fars and finding tens of millions in efficiencies." But the agency warned that without a funding package to keep Illinois' trains and buses running from state lawmakers, the fiscal cliff will balloon back to $790 million in 2027.

The RTA has been warning all year the fiscal cliff facing CTA, Metra and Pace starting in 2026, which could lead to service cuts up to 40%.

Crain's Chicago reported the revision is mostly due to a big boost in sales tax revenue this year. The reduced shortfall also doesn't mean CTA, Metra and Pace aren't facing service cuts in 2026; without action from lawmakers, there will still be major reductions in service. 

The RTA said in a statement that CTA will run out of funding in 2026 and be forced to cut services, and layoff notices to transit workers whose routes are affected by cuts will be notified in the second quarter of 2026. The cuts will go into effect in the third quarter of 2026. 

According to RTA, in 2027 all federal relief dollars will have been spent and the region will have a "full scale crisis." The agency says at that time they will have to implement rolling cuts that will add up to 40% of service in order to close a projected 20% budget gap.

The RTA said this "would devastate the regional economy while congestion skyrockets across the region's roads and highways."

The RTA warned that Illinois is the only state with a large legacy transit system that has not yet acted on funding, pointing to New York, Pennsylvania and Massachusetts where  state lawmakers have passed funding packages to help maintain and increase service frequency and reliability.

CBS News Chicago has reached out to CTA, Pace and Metra for comment and are waiting to hear back.