Faced with a $120 million budget deficit, NJ Transit cut overhead and found savings, but it still wasn't enough to plug the gap.

NJ Transit train at Hamilton Station (Dan Alexander, Townsquare Media NJ)

Testifying before the Assembly Budget Committee on Monday, the agency's chief explained that fare increases were a last resort, but a necessary one. The panel's vice chair was not convinced.

"We have recently proposed a fare adjustment, the first in five years of nine percent. Importantly no customer will experience of more than nine-point-four percent," said Ronnie Hakim, NJ Transit executive director.

A fare "adjustment" is a fare increase. Hakim explained that over the past five years, costs have steadily risen for health care and benefits, insurance, workers' comp and pensions among other things and NJ Transit needs the fund to keep the system running safely.

"We've been working hard developing more than $40 million in savings and efficiencies," Hakim said. "Even so we still face a (budget) gap of about $56 million."

Budget panel vice chairman, Assemblyman John Burzichelli (D-Thorofare) questioned the fare increase and called it a strain on commuters.

"You're agency is now going to be asking ratepayers to pay essentially a 30 percent increase from 2010 to 2016, well ahead of the cost of living," Burzichelli told Hakim. "I want to say this loud and clear; you have no problems that money won't solve."

Beginning May 16, NJ transit will be holding nine public hearings and one public information session across the state to allow commuters to learn more about the proposed fare increase and service changes. The public will be asked to offer comments before the Board of Directors considers the increase in July.

Commuters may offer comments now at www.njtransit.com.