The Bleak Reality Of The MTA Financial Picture

I wanted to get to this yesterday afternoon but things became hectic around here. So now I will take this time to talk about yesterday’s MTA Finance Committee meeting. I could not attend due to some business out on the island. However I made sure to take time out to watch it via the live webcast.

The meeting is what I expected it to be. Going into it, it was pretty much a lock that they would recommend the “doomsday scenario” budget to the MTA Board on Wednesday. This was the case even before Gov. Paterson suggested they do just that due to the Senate’s inaction.

Considering the severity of the situation, the guest speakers were the people I or anyone else following this would expect. One of the best testimonies came from the Tri-State Transportation Campaign’s Executive Director Kate Slevin as she pointed the blame to Albany. I fully agree with her as they are quite responsible for the current crisis. Lets take a look at her testimony via a press release:

Good morning. My name is Kate Slevin and I am executive director of the Tri-State Transportation Campaign, a regional policy watchdog organization working for a more balanced transportation network.

We have one message today and that is – Albany must act. It is two days and counting until fare hikes and service cuts are a done deal. Two days until riders on dozens of bus lines across the region lose service, until monthly, unlimited Metro-North tickets from White Plains to Grand Central rise from $191 to $243. Until monthly unlimited MetroCards increase from $81 to $103. Until Long Island Bus riders lose free transfers to NYC Transit subways and buses and face fares of $3.50 per ride.

If Albany doesn’t act, we begin the vicious cycle of transit disinvestment, where fares increase, service declines, our economy suffers, and safety and reliability are undermined for future generations. Albany cannot let this happen.

Click here for her complete testimony.

One of the other strong testimonies came from Gene Russianoff of the Straphangers Campaign. He stressed a very strong concern in worrying about these financial woes leading to a slowdown in the rebuilding of our system. This is a very legitimate point as riders have a lot more to lose than extra money for fares. Running the MTA is not an easy task as it is a fine balance between maintaining an ancient system while trying to repair & expand it at the same time.

While the prospect of paying more for service seems daunting, Gene’s fear of a slowdown in maintaining & rebuilding the system is a real doomsday if it comes to fruition. Why so many can’t understand this is something that frustrates me often. However can I really be surprised when many riders still obsess over the MTA keeping double books.

Speaking of which, the issue was brought up a few times during the presentation. MTA Board Chairman Dale Hemmerdinger stressed the fact that the agency is not carrying double books. He also stressed that the agency is more than willing to showcase their facts & figures so that everyone can get the accurate picture of what is going on. Here is a brief sample of what he said:

We have extraordinary visible finances. If we can find a way to make it more transparent, we’ll do it. Nothing is hidden. No two sets of book. It’s as simple as we can make it.

During the discussion of the potential enactment of the doomsday scenario, it was evident that the board did not want to go through with this plan. Ignoring the fact that this sentiment was echoed verbally repeatedly, the body language seemed to match. The group clearly looked like it was completely forced to do this due to the Senate’s inaction. However a few proposals were made to find a way to lower the severity of the cuts due to bringing in added revenue.

The first proposal called for a 5% reduction (from 15% to 10%) in the bonus given on pay-per-ride MetroCards. They felt by doing this, they could eliminate some of the proposed service cuts. MTA CFO Gary Dellaverson said he would look into it but felt reducing the bonus would not make any headway.

The second proposal called for a 10% hotel occupancy tax for visitors who come to New York City & in one way or another use its services. The example used was of people using the Staten Island Ferry to take pictures of tourist attractions. As part of this proposal, visitors would get a 2 day MetroCard pass. The idea would be that the MTA could get a nice influx of revenue.

I actually think both proposals should be considered as they could provide some economic relief to the agency in one way or another. Will they come to fruition? Who knows, but at this point anything must be considered.

The other highlight or in reality lowlight of the meeting was hearing more financial bad news. Real estate taxes were approximately $123 million below budget year to date. The taxes for March were 66% below budget. For the year, real estate tax proceeds were down 70%. Ridership was down including a 4% drop in the subway. Shall I go on?………

The point is the meeting was bleak, & the overall picture is the same. With the deadline for the “doomsday scenario” vote only a day away, does Albany still think the MTA is bluffing? Do they still think they can hide behind the allegations of non-transparency? The riding public needs to understand that when they start shelling out more for less, they should point to one place, Albany!

xoxo Transit Blogger

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