At the Ann Arbor Transit Authority’s end-of-term meeting Thursday night, the board unanimously approved its operating budget for the 2013 fiscal year.

Due to decreases in federal support, the board was forced to redistribute funds within its $32.7 million budget. The Michigan Department of Transportation removed $803,500 from the fund that assists Ann Arbor transit with operating costs, and the board said the remaining $1.47 million in federal funding will still accommodate for current services, including the recently passed Five-Year Transit Program.

The Five-Year plan includes additional service on bus Route 4 along Washtenaw Avenue, the expansion of NightRide, a late-night shared-taxi service, and AirRide, a round-trip service between Ann Arbor and the Detroit Metro Airport.

AATA CEO Michael Ford said the decision was “unexpected,” as the AATA had anticipated receiving the same amount of funding as the previous year, but he said it will be able to uphold the same transportation standards as last year.

“We are not proposing any reduction in service,” Ford said. “We now have the ability to utilize the federal funds to manage the budget.”

The board said it made up for the loss by cutting spending in other areas, such as freezing wages for AATA’s non-union personnel and withdrawing $300,000 from reserve funds.

AATA chair Jesse Bernstein said federal funding, which are expected to be about $5.8 million next fiscal year, will now be used exclusively for AATA’s daily operations.

“What we are doing this year is adjusting … and reducing our investment in capital this year in order to make sure we have operating money,” Bernstein said.

Grand Rapids, Lansing, Saginaw, Kalamazoo and Muskegon also saw a decrease of about $8 million in state funding, according to an AATA press release .

Board member David Nacht said while the added expense would hurt the authority, the group’s attention to spending will keep the transit system from faltering.

“It’s a shock but not an enormous piece, 1 million out of $32 million,” Nacht said.

Bernstein countered Nacht, saying that the loss will hinder AATA’s ability to fund new projects.

“We now are at the end of our ability to fund anything outside our regular service,” Bernstein said. “We may have to look at cutting back some of the investments we have made (for) the future. The board also passed a function that we will not provide any service that we do not have funding for.”

—Stephanie Shenouda contributed to this report.