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NEW YORK — The Transport Workers Union on Tuesday outlined a proposal that it said could prevent the Metropolitan Transportation Authority’s proposed subway and bus fare hike, Newsday reported.

The 34,000-member union said improving bus service and using in-house employees to perform work that is now contracted could bridge most of the MTA’s budget gap.

The MTA, blaming a billion-dollar deficit, has proposed raising subway fares for the first time since 1995 — from $1.50 to $2 or to $1.75 with significant cuts in service.

The agency has also proposed raising fares for suburban residents commuting by Metro-North or Long Island Rail Road commuter rails.

The union said the MTA could save $300 million alone by implementing a rapid-transit bus service to reduce congestion and get passengers to their destinations more quickly. The improved service would boost revenue, the union said.

Tom Kelly, a spokesman for the MTA, said that the authority had begun implementing the service eight months ago and would continue to expand it.

The TWU is currently in contract negotiations with the MTA and has asked for a 24 percent wage increase over three years.