MTA Unveils 2011-2014 Financial Plan
Over the last couple of days, more stories have come out about the potential costs of the MetroCards & other aspects of the upcoming fare hike. I decided to not write about them since the MTA Board was meeting today & we would finally get more specific details from the horse’s mouth. Let me first start off by posting a press release sent to me by the MTA:
The Metropolitan Transportation Authority (MTA) today released its 2011 Preliminary Budget and proposed Four-Year Financial Plan for 2011-2014. The proposed plan reflects unprecedented internal cost cutting initiatives undertaken in response to a $900 million shortfall for 2010 resulting from cuts to State assistance and dramatic downturns in tax revenue.
These shortfalls amount to more than $2.5 billion over the plan period. As a result of its cost-cutting actions, the MTA was able to limit the fare revenue increase to 7.5% in 2011, as agreed to with the Governor and Legislature in May 2009 as part of the MTA rescue package. The Plan faces many risks, however, including the need for labor participation to control wage and benefit costs. The July Plan is preliminary; the MTA Board will consider a final Plan in December.
The Plan relies on three key components. The first is the continuation and expansion of the MTA’s cost-cutting initiatives, which have saved more than $380 million in 2010, translating into more than $500 million in annual recurring savings and growing to more than $700 million by 2014. The second key to the Plan is controlling labor costs, which make up 2/3 of the MTA’s operating expenses. The Plan acknowledges that in the current economic situation wage increases must be tied to productivity gains or other cost savings.
The Plan therefore assumes that all employees – both represented and non-represented – would receive a “net-zero” wage increase for two years. Finally, the Plan includes the 7.5% increases in fare and toll revenue in 2011 and 2013 agreed upon with the Governor and Legislature as part of the MTA rescue package approved last spring, which also included a series of new taxes to support the MTA and funding for the first two years of the MTA’s 2010-2014 Capital Program.
“The foundation of this Plan is the most aggressive and comprehensive overhaul in the history of the MTA,” said Jay H. Walder, Chairman and CEO of the MTA. “These actions have allowed us to hold true to our commitment regarding fare increases while maintaining the quantity and quality of service that New Yorkers rely on every day. The State’s ongoing fiscal crisis is one of many risks to the Plan, but with continued hard work and the participation of our labor unions I believe that this Plan can be achieved.”
The MTA was able to eliminate its 2010 deficit through a series of management actions, including:
• Eliminating more than 3,400 administrative and operating positions through layoffs, voluntary separations and elimination of vacant positions
• Freezing pay for management employees
• Increasing efficiency of paratransit and Bridge and Tunnel operations
• Reducing use of overtime
• Eliminating or deferring projects
• Consolidating functions
• Renegotiating contracts with vendors
• More efficiently managing inventories
These actions, the initial stages of a continuing effort to fundamentally overhaul the way the MTA does business, will mean recurring savings of more than $500 million in 2011, rising to $700 million in 2014.
Despite these savings, the Financial Plan remains subject to risks that could mean additional difficulties. The plan assumes that the health of the economy does not deteriorate significantly, and that the taxes that are collected by New York State in the MTA’s name are paid to the MTA. Regardless, additional reductions will need to be identified through labor savings, as noted, and through elimination of shortfalls to subsidies for Long Island Bus.
Labor:
Controlling wage and benefit costs have a critical role to play in stabilizing the MTA’s finances. Wages, benefits and other personnel expenses account for 2/3 of MTA operating expenses. This financial plan assumes that each new labor contract will not impose any additional financial burden on the MTA for two years.
This is intended as a clear statement that the MTA cannot afford to allow salary, wage and fringe benefit costs to rise in ways unconnected to productivity and the regional economy’s ability to support the system. This, however, does not preclude the possibility of wage increases based on bankable productivity improvements or contributions to benefit costs. Consistent with this “net zero” labor initiative, non-represented employees will not receive a cost of living raise in 2010, which will be the second of two consecutive years without an increase.
MTA Long Island Bus:
The MTA proposed budget assumes that Nassau County will fully fund its obligation to support Long Island Bus. Under a 1973 lease agreement, the MTA operates the system as a contractor working on behalf of the County, which owns the bus system. Through 1999, the County made up 100% of its funding obligation.
But since 2000, when the County dramatically cut back its assistance for this service, the MTA has been forced to shoulder an increasing share of this cost, totaling $140 million. The MTA can no longer afford to subsidize this service, which would cost the MTA more than $25 million in 2011.
Proposed Fare and Toll Increases:
Fare policy is designed to raise the necessary revenue while maintaining ridership as much as possible, minimizing impacts to lower-income customers, and increasing efficiencies of fare collection. The proposal below will be discussed at public hearings in the fall before a final plan is taken to the MTA Board for approval. The fare increase would take effect on January 1, 2011.
“Today’s announcement begins a period of public discussion,” Chairman Walder said. “We look forward to hearing from the public and reviewing the public comments as we continue to evaluate this proposal before we adopt the final budget by the end of the year.”
New York City Subway & New York City Local Buses:
Pay-Per-Ride MetroCards:
• The base fare would remain unchanged at $2.25.
• The bonus discount offered on pay-per-ride MetroCards would fall to 7%, from the current 15%.
• Customers would need to put at least $10 on a MetroCard to receive the bonus, up from $8 currently.
• The effective fare paid by users of the pay-per-ride bonus discount MetroCard would rise to $2.10, from the current $1.96.
• The effective fare paid by express bus riders would rise to $5.14, up from $4.78 currently.
Unlimited Ride MetroCards:
• For users of the 30-day unlimited-ride MetroCard, the MTA proposes to adopt one of two options.
o A 30-day MetroCard offering up to 90 rides for $99.
o A 30-day unlimited-ride MetroCard for $104.
o Users of the 30-day unlimited card tend to have the highest incomes of all New York City Transit customers, and would continue to benefit from significant discounts on a per-ride basis as compared with pay-per-ride users. (A rider taking 90 rides in a month would pay $1.10 per ride under the $99 option, or $1.16 per ride under the $104 option.) The median household income for users of the 30-day MetroCard is $63,000; for the 7-day card it is $38,000.
• For 7-day unlimited-ride MetroCards, the MTA proposes to adopt one of two options:
o A 7-day card offering up to 22 rides for $28.
o A 7-day unlimited-ride card for $29.
• In order to simplify options and retire ineffective discounts, the less popular one-day and 14-day MetroCards would be phased out.
o The one-day Fun Pass is used for just 0.8% of subway and bus trips. The 14-day pass, is used for only 2.1% of trips. Proposed changes to the 7-day and 30-day MetroCards close the gap in per-ride cost, eliminating the need for the 14-day card.
Increasing Efficiencies:
It costs 15 cents to collect every dollar the MTA collects in fare revenue. The MTA proposes two changes to help reduce this expense.
• To encourage customers to refill existing MetroCards instead of purchasing new ones, the MTA is proposing a charge of $1 to purchase a new MetroCard.
o The MTA pays $13 million annually to print MetroCards, many of which wind up as litter.
o This is a charge that any customer can avoid. It would not apply to those who refill an expired MetroCard by obtaining a new one, those who hold Reduced Fare passes, or to MetroCards sold at out-of-system retailers.
• Similarly, the MTA is proposing to institute a 25¢ charge for purchasing a paper single-ride ticket.
Long Island Rail Road & Metro-North Railroad:
• Average ticket increases range from 7.6% to 9.4%, depending on distance and ticket type, in order to achieve a revenue gain of 7.5%.
• Most discounts for tickets purchased via the Mail & Ride and WebTicket programs would be eliminated.
o Sales through these programs cost the MTA up to seven times more per ticket than sales through Ticket Vending Machines.
o The discount for the joint Mail& Ride monthly ticket/MetroCard would be retained, but reduced.
• To help limit the size of the fare increase, the MTA is proposing to reduce ticket validity periods in ways that conform with policies of numerous peer railroads.
o A one-way ticket would be valid for seven days (down from the current six months)
o A ten-trip ticket would be valid for 90 days (down from the current one year).
• To speed up on-board fare collection processes, the cost of tickets purchased on board would be rounded up to the nearest dollar.
• The railroads would institute a fee to cover the cost of processing refunds.
MTA Bridges and Tunnels:
• Cash tolls at the MTA’s six major crossings and the Henry Hudson Bridge would increase by 50¢, and cash tolls at its two minor bridges would rise by 25¢.
• The MTA proposes to increase E-ZPass tolls for cars by 10% at all crossings.
• Resident discount programs increase proportionally.
Click here to read the presentation to the MTA Board.
Click here to view the entire financial plan.
Now let’s take a look at a few reports about today’s board meeting starting with Michael M. Grynbaum’s for the New York Times:
he $104 monthly MetroCard moved one step closer to reality on Wednesday as the Metropolitan Transportation Authority voted to start the process of implementing a sprawling set of fare increases on the region’s buses, trains and bridges.
By Jan. 1, railroad commuters and E-ZPass users who cross the authority’s bridges and tunnels would pay about 10 percent more to get into the city. Almost all bus and subway passengers would shell out more for a ride, and the concept of an unlimited pass to the system may become obsolete.
Officials at the transportation authority say the fare increases will occur in lieu of any additional service cuts this year. But the agency’s financial planners acknowledged that keeping fares down in the future could be contingent on extracting concessions from Transport Workers Union Local 100, a tall order for an agency that has traditionally struggled to rein in labor costs.
The meeting of the authority’s board on Wednesday brought out raw emotions from transit workers and politicians who said the fare increases would be an unfair burden on New Yorkers already facing high unemployment.
Click here for the complete report.
I would like to take a breather & look over the financial plan before opining on it. I will try & get around to doing so within the next couple of days. However it could be sooner depending on how the chips fall. At first glance, I doubt I will be surprised at any of the findings as the fare hike has been expected for sometime now.
xoxo Transit Blogger
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City Wants Dollar Vans To Replace Cut Bus Lines
In what is sure to raise the ire of many, New York City officials are looking towards dollar vans to replace bus lines recently eliminated by the MTA due to its financial crisis. Gary Buiso of The Brooklyn Paper has more in this report:
The city wants dollar vans to fill a huge gap in Brownstone Brooklyn bus service that was created by MTA service cuts last month.
The Taxi and Limousine Commission quietly approved the privatization initiative that will allow livery vans to operate along bus routes eliminated by the cash-strapped state agency — including the B71 route that once journeyed from Columbia Street through tony Carroll Gardens and Park Slope on its way to Crown Heights.
Mac Support StoreWilliamsburg’s former B39 line, which was popular with seniors and the handicapped because it went over the Williamsburg Bridge, is also included in the initiative.
Under the plan, the vans will only be allowed to pick up passengers at specified locations — but drop-offs can be at locations negotiated by the driver and commuter.
Where the rubber hits the road, not everyone is getting on board. The proposal is likely to be lambasted in neighborhoods such as Park Slope and Carroll Gardens, where the so-called “dollar vans” have not traditionally operated.
As such, civic leaders in those neighborhoods expressed fear and loathing.
Brooklyn Bridge Realty“Oh my god, it’s insane!” said Maria Pagano, president of the Carroll Gardens Neighborhood Association. “You’ll have guys dive-bombing in and out on Union Street between school buses.”
Even Michael Cairl, the president of the Park Slope Civic Council who was initially open to the idea, saw stepped-up van shuttles as the beginning of the end of public transportation.
“This is the beginning of a pared-down transit system, and that’s unfortunate,” he said.
The city insisted that it is not looking to privatize mass transit.
“The best outcome is a robust, healthy MTA that can provide bus service everywhere it is needed,” said David Yassky, commissioner of the Taxi and Limousine Commission. “Since we don’t have that at the moment, all we can try to do is give commuters the best set of options we can — we are not replacing the MTA.”
And van operators may not be interested in replacing the transit agency either.
“They are trying to use us, but there is nothing in it for us,” said Winston Williams, owner of Blackstreet Van Lines. “I think they’re full of it.”
Williams said the program will have too many restrictions to make it profitable, particularly the inability to pick up passengers where the driver sees fit.
Click here for the complete report.
I feel this is a horrible idea. Let me be honest here, some of these “dollar van” operators & drivers are shady. They have zero business being expected to carry passengers to their destinations due to MTA’s budget woes.
While not all drivers/operators are shady, it is pretty well known how a lot of them lack insurance, have numerous violations, license issues, etc… Should the city really be encouraging such services? This screams of a band-aid solution to cover up for their lack of helping create sustainable funding solutions for the much maligned transit agency.
I am curious to see where this proposal goes especially considering the concern of some operators. Personally if I was a legitimate operation, I would be completely suspect of the city as they probably are using me to help out their cause while leaving me out to dry in terms of making a legitimate profit.
xoxo Transit Blogger
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MTA Puts Nearly 1000 Security Cameras Online
About two months ago, a story came out about how the MTA wasted $21.3 million on non-recordable security cameras in a number of stations. As expected, some elected officials took the chance to jump on the MTA about this fiasco & use the time tested card of “security” to hide their real intention, to score constituent brownie points.
Fast forward to the present where due to a $22 million rush job, the agency has put nearly 1000 of the cameras online. Yepoka Yeebo of DNAInfo has more in this brief report:
Nearly 1,000 broken subway security cameras are now working thanks to a $22 million rush repair job, but one-fourth of the 4,313 cameras on the whole subway system still remain offline, the MTA said on Wednesday.
The broken cameras had politicians fuming after a report revealed that the MTA had spent $21.3 million on a network of security cameras, most of which didn’t work.
MTA repairmen worked steadily to repair the cameras after Gov. David Paterson called every broken camera “a grim invitation to crime in the subway,” AM New York reported.
Now, more than 900 fare control cameras are watching over turnstiles at 31 stations around the city, according to an MTA spokesman. The only cameras of this kind still not working are at the 7th Avenue stop on the E line.
Plans to fix the remaining cameras are still being made, MTA spokesman Kevin Ortiz told DNAinfo.com.
I will save myself the time of repeating myself as my views were clearly expressed in the entry referenced in the first paragraph.
xoxo Transit Blogger
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MTA To Use Technicality To Screw Over A Man?
Did the MTA use a technicality to screw over a man who had his vehicle damaged in accident caused by a MTA bus? This might be the case according to an exclusive report by NY1. Avraham Cohen’s car was damaged by a MTA Bus in Times Square to the tune of $3800. Ever since the accident, he has been getting the run around from the MTA. Susan Jhun has more:
Brooklyn resident Avraham Cohen says his car did not have a chance when it was hit by an Metropolitan Transportation Authority bus in Times Square, resulting in $3,800 worth of damage.
“It was apparent to everybody that it was the bus’s fault, and the police report reflected that as well,” says Cohen. “The police report said the bus was coming out of his lane and sideswiped my car.”
Cohen claims an MTA supervisor came to the scene, acknowledged the accident was caused by the bus and gave him a number to call to start the claims process.
After calling the MTA, Cohen says he got a voicemail asking him to leave his information and wait 10 days for paperwork to be sent to him. Cohen says 10 days turned into a month, as the clock was ticking down on his 90-day deadline to file his paperwork.
“I had basically a month left to put all this paperwork together, get an estimate, get it notarized, send it to them and whatever,” says Cohen. “And at my office I have FedEx, so I sent it overnight, I got it to them within two days of the deadline. And I got a letter back from them in a couple of days saying, ‘Sorry, you didn’t send it to us via registered or certified mail, therefore we’re disallowing your claim.'”
Cohen resent the information through registered and certified mail, but got another letter stating the claim was now disallowed because it was past the due date.
Click here for the complete report.
I understand that policies are in place for various reasons & I am all for them being followed. However at the same time, a case by case evaluation is necessary due to unforeseen circumstances. Why is Avraham being punished for the MTA’s ineptitude of getting him the necessary paperwork? Clearly he should not be & hopefully the agency does right by him as anything less would be completely unacceptable.
xoxo Transit Blogger
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LIRR To Launch Jury Duty Special
In what comes as a bit of news to me, it seems that there is a niche rider market that needed some service to match their needs. The market in question is the unknown amount of people needing to get to Riverhead for jury duty.
After having discussions with Suffolk County officials & analyzing the possibilities, the LIRR has announced it will launch the “Jury Duty Special” on September 13th. Here are the complete details courtesy of a press release they sent me on Monday:
Suffolk County residents will soon be doing their civic duty with the help of MTA Long Island Rail Road.
LIRR President Helena Williams announced today that beginning September 13 the nation’s largest commuter railroad would be revising its schedule to get Suffolk jurors to Riverhead before 9 AM every day that courts are in session.
“For some time, Suffolk County officials have been telling us there is an untapped demand for train service to Riverhead from the hundreds of people who are summoned daily for jury service,” Williams said. “After studying the possibilities, we will adjust our schedule to provide a train specially timed to get jurors to Riverhead courts by 9 AM every weekday and back home again in the afternoon. I am grateful to Suffolk County Commissioner of Jurors Michael D. O’Donohoe, Riverhead Town Supervisor Sean Walter and MTA Board Member Mitchell Pally for their assistance in developing this plan.”
The LIRR is making the adjustment at no additional cost.
Commissioner O’Donohoe said: “The new Long Island Railroad schedule will be very helpful in getting the jurors out of their cars and onto the train, saving the jurors both time looking for a place to park and wear and tear on their vehicles. I want to thank LIRR President Helena Williams and her staff for the hard work they put into this effort in helping make jury service more convenient for the riding public.”
The “Jury Duty Special” will run along the LIRR’s centrally located Main Line, departing from Deer Park at 7:54 AM. The train will then proceed east, picking up customers at Brentwood (7:59 AM), Central Islip (8:03 AM), Ronkonkoma (8:10 AM), Medford (8:21 AM), Yaphank (8:29 AM) and arriving in Riverhead at 8:55 AM where a free shuttle bus will be waiting to take them to nearby courthouses.
Jurors dismissed after morning service will be able to take the shuttle back to Riverhead Station in time to catch the 1:21 PM westbound train, which will make the same stops arriving in Deer Park at 2:28 PM. A later train will depart Riverhead at 3:58 PM.
More than 30,000 Suffolk County residents are summoned to serve on juries in State Supreme Court and Suffolk County Court in Riverhead every year and, on any given day, hundreds may be reporting for duty.
I will be curious as to the cost of tickets for this service if any as well as official rider statistics. Honestly, I never knew there was a demand for service to Riverhead for jury duty. Hopefully it is a win-win for everyone in the end.
xoxo Transit Blogger
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